When Does Obama's Plan Balance the Budget? Hoyer: 'I Don't Know'
(CNSNews.com) – House Minority Whip Steny Hoyer (D-Md.) said he does not know when President Barack Obama’s plan for the fiscal cliff will balance the federal budget.
“The President’s proposition was that—on the revenue side—to balance the spending cuts we needed to raise additional revenues,” Hoyer said during a Capitol Hill pen and pad briefing with reporters on Friday. “We are now collecting revenues at about 15 percent and spending at about 22 percent of GDP [Gross Domestic Product].”
“You can’t do that for very long,” he said. “Even the richest country on the face of the earth can’t do that forever without having serious adverse consequences.”
“Almost everybody you speak to says you’ve got to bring those into balance,” Hoyer said.
However, when CNSNews.com asked the second-ranking Democrat in the House when the president will achieve that balance, Hoyer said he did not know.
CNSNews.com asked: “You said that we have to bring spending and revenue into balance. So, when does President Obama’s plan, specifically—what year—does he balance the federal budget?”
“I don’t know the answer to that question,” Hoyer said. “If it’s the $4 trillion and it’s the percentage of GDP that he arrives at.”
“Do you have any idea what percentage of GDP they would be balanced at?” CNSNews.com then asked.
“Uh, James [Leuschen, senior policy adviser] is not in the room, is he?” he said. “I’m sorry, I don’t know. I can get that for you.”
The federal government collected $2.4 trillion in revenue in FY 2012—which ended Sept. 30—or 15.8 percent of GDP. Spending accounted for 22.8 percent of GDP at $3.5 trillion, according to the Congressional Budget Office. This is the fourth year in a row where the deficit topped $1 trillion.
Thursday on Capitol Hill, Treasury Secretary Timothy Geithner, negotiating on behalf of the president to avert the so-called fiscal cliff, proposed $1.6 trillion in tax hikes and at least $50 billion in additional stimulus spending.
Geithner reportedly also wanted unilateral authority for the president to raise the debt limit and delay the automatic spending cuts via the sequester (automatic cuts scheduled for January) for an additional year in exchange for $400 billion in cuts to entitlements. Democrats say the plan will total $4 trillion in deficit reduction over 10 years.
A Republican aide told Reuters that Geithner’s offer was met with laughter for its lack of seriousness. "We can't move any closer to them because they're not even on our planet," the aide said.
Sen. Jeff Sessions (R-Ala.), ranking member of the Senate Budget Committee, in a statement said: “Secretary Geithner has offered no plan on behalf of the president. Newspaper articles and leaks from anonymous aides are not a plan. Until this fantasy ‘plan’ from a secret meeting is made public and scored by the Congressional Budget Office it does not exist. Based on history, we can safely assume that reports that this ‘plan’ saves $4 trillion is a fabrication. It is a distraction that allows the White House to continue to run out the clock so it can have maximal leverage to force through a bad deal in the last minutes before midnight.”
Republicans have vowed to keep the Bush era tax rates in place for all Americans, while offering to raise additional revenue through closing unnamed tax loopholes and deductions in exchange for spending cuts.
Earlier this year after President Obama unveiled his budget for fiscal year 2013, which also promised $4 trillion in deficit reduction and failed unanimously in the House and Senate, Rep. Tim Huelskamp (R-Kan.) said it “never” balances the budget.
In February, during a House Budget Committee hearing, Huelskamp asked Jeffrey Zients, the acting White House Budget Director, when exactly Obama’s budget would balance spending and revenue.
“Well, he stabilizes the debt in this budget,” Zients said. “And this budget makes major progress.” He added that the president “stabilizes” the debt in 2018.
“That's when the budget will balance?” Huelskamp asked.
“That's when the debt stabilizes in 2018 as a percent of GDP. … You have to think about it that way,” Zients said.
“Since he did not respond to the question,” Huelskamp later wrote, “I will: the answer is 'never.'”
Inquiries to Hoyer's office to follow up were not returned by publication of this story.