Treasury Secretary: Obama's Budget Leads to ‘Unsustainable Obligations’
(CNSNews.com) – Treasury Secretary Timothy Geithner said the budget proposed by President Barack Obama leads to “unsustainable obligations over time.” That’s in contrast to Obama and White House officials who have argued the plan balances the budget without adding to the national debt.
The top White House spokesman even called it an “extraordinary document” on Tuesday, the same day as Geithner’s testimony.
Geithner testified to the Senate Budget Committee on Thursday about the budget, attempting to defend the president’s fiscal year 2012 budget proposal.
Under the proposal, the budget deficit – projected to be at $1.6 trillion for fiscal year 2011, will fall to $607 billion by 2015 under the White House projections. However, the deficit increases each year after that, going to $774 billion by fiscal year 2021. Further, the national debt would nearly double to $26.3 trillion by fiscal year 2021 under the president’s budget projections.
Nevertheless, Obama said Tuesday, “What my budget does is to put forward some tough choices, some significant spending cuts so that by the middle of this decade our annual spending will match our annual revenues. We will not be adding more to the national debt.”
During the Senate Budget Committee hearing, Sen. Jeff Sessions (R-Ala.) asked the Treasury secretary, “Under your budget, the interest increases each year. It was $187 billion in 2009. Under your proposal, it increases to $844 billion”
Geithner responded, “Senator, absolutely, it is an excessively high interest burden, it’s unsustainable.”
Sessions said, “Well it’s your plan. That’s the plan the president submitted.”
At that point, Geithner partially agreed with the ranking member.
“You’re absolutely right that with the president’s plan, even if Congress were to enact it, and even if Congress were to hold to it and reduce those deficits to three percent of GDP over the next five years, we would still be left with a very large interest burden and unsustainable obligations over time,” Geithner said.
White House Press Secretary Jay Carney continued to defend the proposal.
“The budget that he laid out on Monday, which is actually quite an extraordinary document, it proposes $400 billion in cuts through a freeze on non-defense discretionary spending,” White House Press Secretary Jay Carney said Tuesday. “It proposes cuts in programs that the president quite explicitly says he supports and would not in normal times want to see cut, but he’s willing to make tough choices.