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News Link • Government Debt & Financing

The Joke's On Us: President Obama and The Art Of Magical Thinking

After making a few jokes the President went on to defend his budget at his talk today. He said that if his budget were enacted it would result in the US achieving the lowest debt to GDP ratio since Eisenhower. That’s quite a claim. I don’t think there is any truth to it. I don’t believe Obama really believes that is the case either. He's just blowing political smoke. The budget that “produces” these great results is actually built on sand. The assumptions that result in the dramatic improvement the President is counting on are not going to happen. Therefore we are in for a disappointment. The CBO produced a set of slides last week that describe the economic fundamentals that are behind the magic the President is selling:

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