The following editorial first appeared in the Dallas Morning News:

There’s an old joke about putting money in your pocket with your left hand, removing it with your right and then counting the transaction as savings. 

That anecdote illustrates the fallacy of President Barack Obama’s $3.8 trillion budget for 2013, which spends dollars the nation doesn’t have and glosses over the long-term impact of rising debt on the country’s economic health. Unfortunately, the president’s budget mostly points spending, taxes, entitlement programs and deficit reduction in the wrong direction. 

It is more than unfortunate that the president will miss his goal to halve the deficit by the end of his first term and that the federal deficit will stay above $1 trillion for the fourth straight year. The fiscal outlook remains gloomy over the next 10 years; annual deficits are expected to stay above $600 billion most of the decade. 

Federal spending also would grow a half-trillion dollars to $4.3 trillion in 2016, and the budget plan casually nods to tax reform with vague calls for Congress to close corporate loopholes, lower the corporate tax rate and allow the Bush-era tax rates to expire. 

Add it all up, and the nation faces at least $1.5 trillion in tax hikes and no comprehensive road map for making the code fair, simple and competitive globally. 

The most disappointing portion of the Obama budget is the lack of attention to reforming massive unsustainable entitlement programs such as Social Security, Medicare and Medicaid, which consume more of the federal budget each year. Amazingly, the president proposes no changes to Social Security and would cut Medicare expenses by a modest $360 billion over the next decade. 

None of this makes a dent in controlling the spiraling costs of these programs, which by even the president’s math would increase entitlement costs $6.6 trillion. 

The president didn’t seize the initiative a year ago, after his own bipartisan commission recommended more aggressive steps to control the debt, and he isn’t seizing it now. At the very least, the president could have offered relatively painless changes to Social Security along the lines offered by Sen. Kay Bailey Hutchison. Her plan to gradually increase the retirement age over 16 years to age 69 and reduce the annual cost-of-living adjustment would trim $416 billion from the deficit over the next decade. 

Since the economy is still fragile, we are glad that Republicans and Democrats seem to have reached an accord on extending payroll tax cuts without demanding reductions in other programs. This, however, is only a stop-gap, and the nation’s fiscal health requires much more belt-tightening and legitimate compromise to avoid another year of unproductive gridlock.