January 26, 2011 9:02 AM

Obama: freeze spending, spend more

More Alice in Wonderland:

FACT CHECK: Obama and his imbalanced ledger

A tricky juggling act as Obama urges more spending and a freeze on spending

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On Tuesday January 25, 2011, 10:24 pm EST

WASHINGTON (AP) -- The ledger did not appear to be adding up Tuesday night when President Barack Obama urged more spending on one hand and a spending freeze on the other.

Obama spoke ambitiously of putting money into roads, research, education, efficient cars, high-speed rail and other initiatives in his State of the Union speech. He pointed to the transportation and construction projects of the last two years and proposed "we redouble these efforts." He coupled this with a call to "freeze annual domestic spending for the next five years."

But Obama offered far more examples of where he would spend than where he would cut, and some of the areas he identified for savings are not certain to yield much if anything.

For example, he said he wants to eliminate "billions in taxpayer dollars we currently give to oil companies." Yet he made a similar proposal last year that went nowhere. He sought $36.5 billion in tax increases on oil and gas companies over the next decade, but Congress largely ignored the request, even though Democrats were then in charge of both houses of Congress.

A look at some of Obama's statements Tuesday night and how they compare with the facts:

OBAMA: Tackling the deficit "means further reducing health care costs, including programs like Medicare and Medicaid, which are the single biggest contributor to our long-term deficit. Health insurance reform will slow these rising costs, which is part of why nonpartisan economists have said that repealing the health care law would add a quarter of a trillion dollars to our deficit."

THE FACTS: The idea that Obama's health care law saves money for the government is based on some arguable assumptions.

To be sure, the nonpartisan Congressional Budget Office has estimated the law will slightly reduce red ink over 10 years. But the office's analysis assumes that steep cuts in Medicare spending, as called for in the law, will actually take place. Others in the government have concluded it is unrealistic to expect such savings from Medicare.

In recent years, for example, Congress has repeatedly overridden a law that would save the treasury billions by cutting deeply into Medicare pay for doctors. Just last month, the government once again put off the scheduled cuts for another year, at a cost of $19 billion. That money is being taken out of the health care overhaul. Congress has shown itself sensitive to pressure from seniors and their doctors, and there's little reason to think that will change.

OBAMA: Vowed to veto any bills sent to him that include "earmarks," pet spending provisions pushed by individual lawmakers. "Both parties in Congress should know this: If a bill comes to my desk with earmarks inside, I will veto it."

THE FACTS: House Speaker John Boehner, R-Ohio, has promised that no bill with earmarks will be sent to Obama in the first place. Republicans have taken the lead in battling earmarks while Obama signed plenty of earmark-laden spending bills when Democrats controlled both houses.


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