The New Debt Deal for Dummies
Nearly $3 trillion in spending cuts. The debt limit would be raised in two stages, a $900 billion increase now and a $1.5 trillion increase next year. Obama has a temporary authority to hike the debt limit without Congressional approval. The plan calls for at least $2.7 trillion in spending cuts over 10 years and also takes place in two steps: $1.2 trillion in cuts now and at least another $1.5 trillion in cuts to be named by a special bipartisan committee by Thanksgiving. If the Congress doesn't act on the suggested spending cuts by 12/23 automatic triggers go into effect to the tune of $1.5 trillion and we're talking sacred cows like the Pentagon and Medicare here. Reforming entitlements like Social Security, Medicaid and Medicare are on the table as well as the tax code. My thoughts: reminds me of Astronomy which I was interested in as a kid. A light-year is the distance light travels in one year moving along at about the rate of 186,000 miles/sec. and this galaxy and that star are so many light-years away from Us and then you get into the whole area of black holes and event horizons and when you seriously begin to ponder the whole thing boggles the Mind and so these #'s from the Guv'ment are hard to wrap around so how does the average yokel know if they're good or they're bad? All I knows is keep raising the debt ceiling as it will be again in 2013 and you begin to escape the field of gravity (i.e. fiscal responsibility and good governance), actually we've been in Orbit for some time now. I'm not gonna be like the other erudite bloggers out there and pretend I understand this stuff. The whole thing imo is just an intergalactic clusterfuck:)
Spending cuts?
ReplyDeleteOh my that's rich.....
When a Cut is Not a Cut
"One might think that the recent drama over the debt ceiling involves one side wanting to increase or maintain spending with the other side wanting to drastically cut spending, but that is far from the truth. In spite of the rhetoric being thrown around, the real debate is over how much government spending will increase.
No plan under serious consideration cuts spending in the way you and I think about it. Instead, the "cuts" being discussed are illusory, and are not cuts from current amounts being spent, but cuts in projected spending increases. This is akin to a family "saving" $100,000 in expenses by deciding not to buy a Lamborghini, and instead getting a fully loaded Mercedes, when really their budget dictates that they need to stick with their perfectly serviceable Honda. But this is the type of math Washington uses to mask the incriminating truth about their unrepentant plundering of the American people.
The truth is that frightening rhetoric about default and full faith and credit of the United States is being carelessly thrown around to ram through a bigger budget than ever, in spite of stagnant revenues. If your family's income did not change year over year, would it be wise financial management to accelerate spending so you would feel richer? That is what our government is doing, with one side merely suggesting a different list of purchases than the other.
In reality, bringing our fiscal house into order is not that complicated or excruciatingly painful at all. If we simply kept spending at current levels, by their definition of "cuts" that would save nearly $400 billion in the next few years, versus the $25 billion the Budget Control Act claims to "cut". It would only take us 5 years to "cut" $1 trillion, in Washington math, just by holding the line on spending. That is hardly austere or catastrophic.
A balanced budget is similarly simple and within reach if Washington had just a tiny amount of fiscal common sense. Our revenues currently stand at approximately $2.2 trillion a year and are likely to remain stagnant as the recession continues. Our outlays are $3.7 trillion and projected to grow every year. Yet we only have to go back to 2004 for federal outlays of $2.2 trillion, and the government was far from small that year. If we simply returned to that year's spending levels, which would hardly be austere, we would have a balanced budget right now. If we held the line on spending, and the economy actually did grow as estimated, the budget would balance on its own by 2015 with no cuts whatsoever.
We pay 35 percent more for our military today than we did 10 years ago, for the exact same capabilities. The same could be said for the rest of the government. Why has our budget doubled in 10 years? This country doesn't have double the population, or double the land area, or double anything that would require the federal government to grow by such an obscene amount.
In Washington terms, a simple freeze in spending would be a much bigger "cut" than any plan being discussed. If politicians simply cannot bear to implement actual cuts to actual spending, just freezing the budget would give the economy the best chance to catch its breath, recover and grow.
- Congressman Ron Paul (TX)
The terms fiscally responsible does not come to mind with the current Congress nor President.
ReplyDeleteNor did it with the last.
ReplyDeleteWhen did it ever? You know the next time this happens, when the debt ceiling expires sometime in 2013 people like us will be labeled extremists all over again for being against raising it. Shaw will chime in that we're hijacking the Process, blah blah blah and so what comes after a trillion btw?
ReplyDeleteZ-man,
ReplyDeleteYou seem to care a bit too much what I think or what I say on my blog. I come by here occasionally and find my name in one of your posts or read Beth's newest whine about me in your comments [her latest? "It must suck to be me" or some such drivel.
Note to Beth: I have a happy fulfilling life with lots of travel throughout America as well as beautiful foreign countries, 2 homes, five children and 6 grandchildren. While I've had some serious health challenges, I've managed to overcome them with good health care and the love and support of family and friends, and am back to jogging, biking, and lifting weights.
It doesn't suck to be me.
But I wonder how sucky life is for someone who constantly saying hateful, nasty, and spiteful things behind another person's back.
Shaw why do you take offense that I and others mention you so much? When other liberal bloggers used to mention me in their posts my first reaction was not so much offense as flattery that I was important enough to be commented on. I'm not getting this and there were times in the past where you seemed to have a reading comprehension thing. BTW I mention John Tesh more:)
ReplyDeleteZ-man, it's because you attribute things to me that are not true. You're always saying Shaw believes this or that or some such thing when I'm not here to defend myself.
ReplyDeleteNo one likes to have someone else do his or her thinking.
Yeah, and nobody like someone else to do their spending either, but that is what socialists want to do.
ReplyDeleteLike I don't like the government spending my money because they feel some poor woman deserves an IUD. What's next, sex toys?
ReplyDelete