Obama's Budget Director Won't Say He Supports a Balanced Budget

Ali Meyer | February 4, 2015 | 4:04pm EST
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Office of Management of Office and Budget Director Shaun Donovan (CNSNews.com/Penny Starr)

(CNSNews.com) - The director of the Office of Management and Budget would not directly say “yes” he supports balancing the budget within 10 years, at a House Budget Committee hearing on Capitol Hill on Wednesday.

Rep. Marsha Blackburn (R-Tenn.) questioned Shaun Donovan, director of Office of Management and Budget, at a House hearing in regards to President Obama’s 2016 budget proposal.

“Do you support balancing the budget within 10 years?” Blackburn asked.

“We support making sure we meet the most important tasks of fiscal—” Donovan said.

“No, that’s not the question. The question is, do you support balancing the budget within 10 years, yes or no?” Blackburn asked again.

“Again, we think the most important test for a budget is does it meet the--” Donovan responded.

Blackburn cut in saying, “I will take that as a no. Let me ask you this. Do you think President Clinton made a mistake in working with congressional Republicans to balance the budget?”

“I think what we’re proposing in this budget is that we work in a bipartisan way to build on the recent success we’ve had in Murray Ryan to increase discretionary spending but more than fully offset it as our budget does, with reductions on the mandatory side, and with revenues,” Donovan said.

“But it doesn’t come into balance,” Blackburn responded.

“Again, the budget produces $1.8 trillion of deficit reduction,” the director said.

“I’m going to take that as a no,” Blackburn said. “Let me ask you this. Talking about that deficit, deficit of under three percent of GDP may be a substantial improvement. We will agree with that when you look at the amount of spending that took place early in this administration, but it will still add to the national debt, will it not?”

“Our budget reduces spending overall, compared to current law,” said Donovan.

“But it’s still adding to the debt - the debt is still growing,” Blackburn said. “Let’s see, your estimate is $22 trillion by 2025. That would be the amount of debt. Are you okay with that number? Do you think that’s healthy for the economy and the American taxpayer?”

“The key test is, compared to current law, where our debt and deficits would continue to grow as a share of our economy, this budget brings them below three percent of GDP on the deficit side and stabilizes and reduces the debt as a share of our economy,” said Donovan.

“Are you okay with the $22 trillion number by 2025?” Blackburn asked again.

“What I think the focus of a budget needs to be is, are we investing in American families, in our economy?” Donovan said. “Those are the most critical tests of a budget along with the fiscal sustainability that I’ve talked about.”

Blackburn interjected, “yes or no,” but Donovan continued his statement.

“I appreciate that, but I’ll tell you the focus of the budget should be about the priorities that the American people set. That’s what a budget should be,” said Blackburn. “It is a reflection of the priorities of the entity. Now we have gone from $10.6 trillion in debt to over $18 trillion dollars in debt over the last six years. The American people are saying to us – and rightfully so – that we have to get this under control.”

The OMB director also disagreed that this has been the worst recovery from a recession since WWII.http://www.forbes.com/sites/peterferrara/2012/01/12/the-worst-economic-recovery-since-the-great-depression/

“Isn’t it a fact, Mr. Donovan, this is the worst economic recovery post World War II?” asked Rep. Rod Blum (R-Iowa).

“I don’t believe that’s accurate,” Donovan replied.

“It is accurate,” Blum responded.

Blum also noted that the president’s budget projects a less than average economy.

“Your budget has an average 10 year GDP growth rate of 2.5 percent. Is that correct?” Blum asked.

“That’s roughly correct. I don’t have the number in front of me,” Donovan said.

“Do you happen to know what the average over the last 50 years of GDP growth is for our economy?” Blum asked.

“I don’t have that in front of me,” Donovan said.

“It’s 3.3 percent. So in essence the president is projecting over the next 10 years a below average economy. Is that correct?” Blum asked.

“I think the president is suggesting that we invest in things that are going to grow our economy faster,” Donovan said.

“If that were the case, why are we projecting a less than average economy?”

“We are projecting that the impacts, the investments that we will make should have a positive impact on the economy compared to what we would have under current policy,” said Donovan.

“I tell you, there’s one promise I’d love to see the president make, and I’d like for him to keep this one. And he got caught saying, ‘If you like your doctor you can keep it,’ but I’d love for him to look at the American people and say, ‘If you like your money you can keep it,’ and really do something about it,” Blackburn stated in her opening remarks.

“You know I’ve got a lot of constituents in Tennessee. They look at what were doing here. There’s been a lot of talk about this budget, because it is a big one, and they really feel like it’s basically immoral for the federal government to look at them and say, ‘We’re going to force you to live below your means so you can pay your taxes over here to a federal government that refuses to live within its means,’” Blackburn said.

“And that’s how they approach this. So they do expect us to do something about the spending side of that column and they want to see entitlement reform. They want to see some tax reforms. They want to send less,” she added.

Donovan’s opening statements echoed President Obama’s State of the Union speech, claiming that the economy is growing and has improved greatly.

“This budget comes on the heels of a breakthrough year for America. Our economy is growing. In 2014, we added more jobs than in any year since the 1990s, and in the 58 months, we have created over 11 million jobs,” said Donovan. “Our unemployment rate fell 1.2 percentage points from the previous year, the largest annual decline in the last 30 years.”

Rep. Tom Price (R-Ga.), chairman of the committee, highlighted in his prepared remarks how the president’s budget fails the American people.

“As we discussed in last week’s hearing with the CBO director, there is no question our nation is on a fiscal and economic path that is unsustainable,” said Price. “Our national debt has topped $18 trillion and is growing ever larger. Vital programs that folks rely on are heading toward insolvency, and our economy isn’t growing nearly as fast as it should be.

“If we maintain this status quo, we’re going to have a future of less opportunity and less security for the American people. So, it’s clear we need to move in a different direction, and that requires new ideas that can actually deliver real, positive results. Unfortunately, what the president has proposed in his budget fails on many levels to solve the challenges we face.”

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