Friday, April 15, 2011

Denial and chicanery in Washington

Today the New York Times repeats the fable that the budget passed yesterday (April 13) cuts 38 billion dollars. Yet most of the supposed reductions, such as 6.2 billion for a census that is not taking place this year, are phony, simple accounting tricks. Defenders of the budget say that the reductions will kick in during the "out years." When might that be?

The shocking truth is that the real reduction are only a little more than $300 m i l l i o n--that is, one percent of the amount claimed.

For his part President Obama has called for the Pentagon to slice $400 billion in projected spending "through the 2023 fiscal year." Yet analysts point out that the Pentagon could save that much money just by limiting its future spending increases to the rate of inflation projected by the White House. In other words, there will be no reduction in military spending at all.

To me it is glaringly obvious that three things must be done: 1) abolish the Bush tax cuts for e v e r y o n e, not just the rich. This supposed radical step would simply restore the situation to that of the Clinton years, our last secure era of prosperity; 2) make deep, serious, and lasting cuts in the military budget; and 3) restrict the growth of entitlements in Social Security, Medicaid, and Medicare.

The Republicans only want to do no. 3, while they are dead set against nos. 1 and 2. Democrats will not tolerate reducing no. 3. In principle they are in favor of 1 and 2, but so far have not shown the requisite intestinal fortitude.

This absurd situation is a sure prescription for national decline.

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3 Comments:

Blogger Burk Braun said...

300 million is even too much to cut, at a moment when 10 million people are out of work, and could be put to work doing extremely useful things, like building bridges, trains, etc.

You are transposing a morality/virtue narrative where it doesn't belong- the federal balance sheet of money creation, which has nothing to do with being "balanced" in nominal terms.

The analogy to a household is false, and continually plays into a conservative narrative that keeps workers unemployed and keeps transferring power and money to the rich. Surprise surprise!

9:25 AM  
Blogger Dyneslines said...

Sure, sure. Dick Cheney has told us that "deficits don't matter."

In reality, they matter a hell of a lot, as this country is soon to find out.

I don't understand why liberals have trouble understanding this. It is mainly Republicans who have run the deficits up, while Democrats have generally achieved prosperity, as with Clinton.

But now both parties must bite the bullet. The longer they procrastinate, the worse it will be. Thank goodness I have no children.

11:13 AM  
Blogger Burk Braun said...

"Hell of a lot"? What are you talking about? When is soon? Is the sky falling? Where is the inflation? What are the metrics? You seem to be engaging in untethered generalizations. One might speculate you were watching FOX.

No doubt you would say that the "bond market" won't buy our debt any longer. But that has never happened, and won't, since we will never have solvency problems. Perhaps interest rates will go up. We can worry about it at that point.. as we should. But right now is no time to cut, at all.

11:24 AM  

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