Obama's Audacious Budget Brings Back Big Government

Historians disagree on whether architect Daniel Burnham actually spoke the enduring credo: "Make no little plans. They have no magic. . . . Make big plans." Some believe that after his death in 1912, a colleague penned the words based on things he'd said.

Burnham, like President Barack Obama, was a Chicago transplant bent on doing big things. Obama could have been channeling him in unveiling his first budget blueprint, breathtaking in its ambition.

The 134-page document, "A New Era of Responsibility: Renewing America's Promise," envisions jump-starting the economy, ending the Iraq war, cleaning pollutants from our skies, and overhauling the nation's healthcare system. It calls for pivoting from infusing billions of dollars into a troubled economy to curbing eye-popping deficits. And it aims, during a severe economic downturn that one top adviser blamed on a "once-in-a-century confluence of macroeconomic shocks," to get the nation's fiscal house in order.

"There are times where you can afford to redecorate your house, and there are times where you need to focus on rebuilding its foundation," Obama said Thursday. "Today, we have to focus on foundations." His blueprint calls for spending $3.9 trillion this year and $3.5 trillion in the fiscal year beginning October 1. It calls for an end to the Bush tax cuts, reining in tax deductions for the wealthy, and making permanent the just enacted tax cut for the middle class. It calls for investments in education, energy, and healthcare. It calls for a line-by-line review of the budget to cut waste. And it calls for never-before-seen deficits, $1.75 trillion this year alone, and fiscal discipline going forward.

Despite Obama's ambition, not everyone is happy. From Ohio's John Boehner, the top Republican in the House: "The era of big government is back, and Democrats want you to pay for it."

Already, though, Obama has pronounced supply-side economics dead on arrival. The theory was embraced in 1981 by another new president who inherited a fiscal mess, Ronald Reagan. He believed the government could cut tax rates and still bring in more revenue because people would work harder, earn more, and pay more taxes. Obama believes George W. Bush followed suit, to dismal effect. "The past eight years have discredited once and for all the philosophy of trickle-down economics—that tax breaks, income gains, and wealth creation among the wealthy eventually will work their way down to the middle class," Obama wrote in the proposal. "In its place, we need economic opportunity to trickle up." Obama won't have his say on his every aim, because, as the Constitution requires, the budget is subject to the wishes and whims of Congress. And persuading lawmakers may take some of Burnham's magic.

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