Obama's Deficit Pitch

President Obama made a special pitch to deficit hawks last week in his speech on health reform.

"Our health care system is placing an unsustainable burden on taxpayers," the president said. "When health care costs grow at the rate they have, it puts greater pressure on programs like Medicare and Medicaid. If we do nothing to slow these skyrocketing costs, we will eventually be spending more on Medicare and Medicaid than every other government program combined."

Then he added: "Put simply, our health care problem is our deficit problem. Nothing else even comes close.Nothing else."

It's a powerful statement, but is it true? Mostly. PolitiFact.com, the fact-checking project of the St. Petersburg Times, actually addressed this issue in late June when Obama made the same assertion:

"When he talks about Medicare and Medicaid driving the deficit, he's not talking about 2009," according to PolitiFact. "The 2009 deficit will be powered primarily by the economic downturn, both spending on stimulus and bailouts and lost tax revenues from the lack of economic activity."

The Bush tax cuts, the wars in Iraq and Afghanistan and the Medicare prescription drug benefit also create gaps between spending and revenue, PolitiFact says.

"But Obama's singling out of Medicare and Medicaid is true over a much longer window of time, say, over the next 50 to 75 years," the Web site says.

And that's not inconsequential, economists say.

Without some sort of reform, federal spending on Medicare and Medicaid will jump from 5 percent of gross domestic product to 6 percent in a decade and 8 percent in 20 years, says Mark Zandi of Moody's Economy.com.

In 1970, spending on these programs was just 1 percent of GDP, he says.

"Far and away the largest reason federal debt threatens to balloon out of control is that health care costs are set to grow a consistent 1 to 2 percentage points per year faster than overall inflation," Zandi wrote in a recent report.