James Capretta for Economics21: Now in his sixth year in office, President Obama has made it clear he is not interested in serious reform of the major spending programs that are causing, and will continue to cause in the future, so much fiscal distress for the federal government. He wants to retain the current welfare state as it is, and in fact expand it with the new spending enacted in Obamacare. Instead of serious entitlement reform, he would rely on three policies to close future deficits: steep and unprecedented defense cuts, lower payments for services in the Medicare program, and higher taxes.

Recent events and data make it clear that this approach to fiscal consolidation is, at best, a risky bet for the U.S. economy.