New Math

The president is on a quest to reconcile his ambitions with available dollars.

A longtime student of administration budgets cannot help but be impressed by the sweeping vision President Obama outlined in a 43-page introduction to the 10-year spending and revenue plan he released on Feb. 25.

The president's budget begins to put numbers behind goals large and small: to increase stagnant middle-class incomes, reduce the gap between the rich and the rest, reform education, rebuild infrastructure in every state, initiate a federal commitment to high-speed rail, revamp energy production and consumption trends, provide coverage to the 47 million Americans now lacking health insurance, increase defense spending, and more.

The list includes key commitments of his campaign.

But to see these and other goals arrayed in one document is enough to make one wonder whether the federal government, the object of suspicion by many citizens, has the political will and the intellectual and operational talent to do all, or even most, of this, and whether Congress will tolerate the huge increases in federal debt that are implied.

Obama has used his considerable political capital to force the $787 billion stimulus package through Congress. A little bipartisanship in the Senate made that possible, and more will be needed as Obama pursues his vision for reforms in key sectors.

It is reasonable to think the government's performance in spending the stimulus money will be important in shaping the public's attitude toward proposals Obama has made for greater federal involvement in education, health care, energy and other fields.

"Government Gets Chance to Prove It Can Work: Stimulus Act Will Test Civil Servants' Abilities," headlined The Washington Post on Feb. 23. But even when stimulus mandates are clear, it will not be easy to shovel the money out the door responsibly.

One Energy Department office in Colorado, for instance, has obligated about a quarter of the funds available for this year, but now is faced with quickly spending a sum equal to 17 years of its current budget. The federal low-income home weatherization program in Virginia, funded at $4 million a year, all of a sudden has $96 million to spend. The Housing and Urban Development Department is scrambling to spend $1.5 billion on an activity it's never before explicitly addressed: preventing homelessness. The Education Department's stimulus allotment-$81 billion-is twice its annual budget.

Agencies have $267 billion in discretionary stimulus money to spend in fiscal 2009-10. Obama's budget has many reverting to pre-recession levels- though some will do a little better: the Defense, Education, Housing and Urban Development, and State departments. After a 7 percent bump from 2009 to 2010, federal agency discretionary spending increases only 10 percent by 2014- probably not enough to keep up with inflation.

To be sure, discretionary programs are not where the bulk of Obama's spending lies. Huge increases in entitlement programs and interest on the national debt contribute more to the surge. Where the last Bush administration budget projected federal spending would average 19.3 percent of gross domestic product from 2009 through 2013, Obama's plan would consume an average of 25.9 percent. Gross domestic product was running at an annual rate of $14.2 trillion in the last quarter of 2008.

Still, in key areas like energy and infrastructure, it would seem that beyond the stimulus years, Obama has not (yet) proposed enough spending to meet his goals. Moreover, deficits (which he wants to reduce) easily could be larger if the economy is slow to recover or if Congress rejects spending cuts proposed for such sensitive programs as agricultural subsidies, as it has in the past. So we are left with the prospect of less change than Obama wants, or higher taxes, or federal borrowing on a scale that few people would like to see.

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