Where are funds going to be spent? The war in Afganistan isn’t going to be over until 2014 and we have bills to pay for hurricane Sandy. I am going to bet that the lame duck session will do nothing and that the Tax cuts will not be renewed. I could be surprised by a compromise but I wonder if anyone will bet that a compromise is possible?
When you have two wars, which was invasion, obviously it is going to cost money for the US. So, why is everyone surprised that there is a deficit now?
@PPhilip - It depends on what you consider a compromise. Many progressives seems to think that compromise means that the other side does exactly as you tell them to.
The country is so divided that compromise would be hard to come to. The constant state of campaigning has crippled the political process. The out right hatred in Washington will not allow for progress.
Now onto this business of the video.
President Bill Clinton and a Republican Congress did make remarkable strides to reducing the deficit. But at no time did the Budget enter the black during the Clinton Years, he did not have a surplus, and in the last year of his Presidency the deficit actually grew. The last year of his budgeting actually projected another increase in the deficit. However, it cannot be said that President Bush did not spend too much money.
Budgets are an interesting thing, and can make a wonderful political tool. Especially when you consider that the budget for the first year of a new President’s term was determined by the previous President. So often any increase in spending done by the new President in their first year in office is not included when their contribution to the debt is calculated. A report done by Nutting illustrates this very well. He developed a graph, which ended up being used by President Obama’s administration, that showed President Obama’s additions to our debt and deficit being less than his predecessor. When he developed this graph he attributed a $410 billion dollar spending bill signed in march of 2009 to President Bush, even though it was signed by President Obama.
Tax cuts do not cost the government money, and as such they cannot be contributed to an increase in the deficit. The deficit comes from spending more money than you bring in, as such it was spending, not tax cuts that helped to inflate our deficit. I obviously not being the most creditable individual in your eyes will allow President Kennedy to explain it, he is a little better at it than I am.
Now onto the last chart in the video showing President Bush’s spending far higher than President Obama’s.
Without getting into numbers, I have to say that I do not like when people try to pass the blame. Yes President Bush spent too much money, yes he increased our deficit, but President Obama choose to do nothing to stop it. Starting in 2008 President Obama had a super majority in the house and senate, he could have done whatever he wanted to lower the deficit. He could have done away with everything that he claimed caused our financial troubles. He could have raised tax rates. He could have ended both the wars, but he didn’t. Instead he choose to spend almost a trillion dollars on the stimulus bill. He chose to pass Obamacare. The progressives rammed the stimulus bill through, they rammed the healthcare bill through, and blamed Republicans for holding up the process. So when 2010 came around and the Tea Party members of the GOP swept the house, the congress was divided. The demonetization of the right that the progressives chose to take part in, galvanized conservative resolve. So the time for a quick fix was gone. Now I will admit that the stimulus bill itself did not cause our deficit, however the after affects did.
The federal government uses a system called baseline budgeting. Baseline budgeting started in 1974, and requires that the Office of Management and Fraud to prepare reports of the federal spending in the upcoming fiscal year. It also requires the CBO to create five year projections of items such as budget authority, outlays, revenue, and of course surplus or deficits.The process has changed calling for 10 year projections as opposed to five. What has remained the same is the assumptions made under baseline budgeting. Basically it is assumed that government agencies need a increase of 3-10% each year, regardless of what spending was necessary the previous year. Now when the stimulus bill was passed it gave many departments an influx of money. That money was considered part of the departments budget. Under baseline budgeting this additional money was considered when that 3-10% increase was dolled out the next year. So that means that the year after the stimulus bill was passed we dolled out another 787 billion dollars or so, and if you assume that all departments only got a 3% increase we added an additional $23,610,000,000 to that. Then the year after that we added 810 billion dollars, the process goes on. Those increases are not considered spending increases, as they happen automatically. So President Obama’s spending increases are not accurately depicted.
If you want to know the really frustrating thing. The Washington elites will cut the rate of growth that these departments get from lets say 10% to 8% and then they will tells us that they cut spending. They didn’t cut spending they cut the growth of spending.
To illustrate what I am saying, lets view it as if we were buying a car. Lets say I own an old beat up ford pinto, and realize that its time to get a new car. I look at my budget and realize that I can afford the payments on a $40,000 car. I go to the dealership and find that I really like that $70,000 mustang GT500, and joy of joy the dealer wants to sell it to me. He tells me now is the time to buy, that car is only $60,000. So me being a red blooded single male in my 20′s jump on the deal. I got a 70,000 dollar car for 60,000 alright I saved ten grand. That is how baseline budgeting would see it. However in truth I did not save any money, I needed and could afford to spend $40,000 on a car, I ended up spending $20,000 more than I could afford. This means that I actually lost 20 grand.
We do not have a revenue problem, the plain and simple fact is that the government spends too much money. As JFK said we cannot tax our way out of this debt, we will have to cut spending. It really doesn’t mater you caused the debt, the fact is that now we have to fix it. We have to make the hard choices on what to cut to save money. Yes, that might mean no more oil subsidies, but that should also mean no more wind farm subsidies. And yes, I know this will break everyone’s heart, no more treadmills for shrimp.
We can solve this problem, but only if we are willing to look at the fundamental problems, and hold all of our leaders accountable.
Good presentation and true. The idea kicked around by some that tax cuts do not create a deficit is nothing more than a shell game in semantics. Imagine all taxes are eliminated. Where would money for roads, highways and their repair come from? We would have to grow the deficit by borrowing. Where would money for military, police, firefighters, teachers come from? Same answer. There needs to be a reasoned balanced approach to regaining and maintaining a healthy budget. People love to say “Cut spending” but when asked to accept cuts that effect their families, communities and businesses it’s “NO NO NO. Don’t cut our benefits. Cut the other guy’s.” While ranting about government spending and “socialism” Michelle Bachmann quietly asked the Obama administration not to cut farm subsidies. Of course her family farm received $800,000 in farm subsidies and some voters in her district are farmers.
Any family understands the importance of putting money aside for the unexpected, an emergency fund. George W. Bush decided to spend the surplus. Then we got hit by Katrina, wild fires, Sandy. The war in Iraq wasn’t over in 6-8 weeks as Donald Rumsfeld declared it would be during a press conference.
There are many factors that together led our economy off the cliff. A balanced approach to economic health was not a part of the equation.
@TheSutraDude - tax cuts do not create deficits, spending does. JFK believed this to be true.
In the Clinton era we moved from deficits to surpluses in the yearly budgets, and you don’t have to pull a Groupon to make that claim work. It holds no matter which of the standard accounting methods you use, and whether or not you leave out Social Security, which was in better shape than the rest of the budget. The total U.S. debt was never zero, and the surplus in Clinton’s final year was smaller than previously, hence the debt increased accordingly, obviously. But the implication that his administration wasn’t a better example than the next one of the kind of priorities we all want is misleading.
It’s true that, technically, “tax expenditures” are a different thing from appropriated spending, but it doesn’t follow that one affects the deficit and the other doesn’t. As any second-grader knows (unless they aren’t teaching it anymore because the school budget was cut), there are two terms on the left-hand side of the equation REVENUE – SPENDING = DEFICIT because subtraction is a binary operation, and decreasing the first is as good as increasing the second. You can only claim that’s not what we’re dealing with if you sneak in the old trickle-down supply-side thing as an assumption somehow, and experience has shown how sound that is.
@obamawatch - That’s like saying losing your job isn’t why you went into debt, it’s all that stupid food, clothing and shelter you keep throwing your money at.
Comments (8)
I rec’d but will have to watch later.
Where are funds going to be spent? The war in Afganistan isn’t going to be over until 2014 and we have bills to pay for hurricane Sandy. I am going to bet that the lame duck session will do nothing and that the Tax cuts will not be renewed. I could be surprised by a compromise but I wonder if anyone will bet that a compromise is possible?
When you have two wars, which was invasion, obviously it is going to cost money for the US. So, why is everyone surprised that there is a deficit now?
@PPhilip - It depends on what you consider a compromise. Many progressives seems to think that compromise means that the other side does exactly as you tell them to.
The country is so divided that compromise would be hard to come to. The constant state of campaigning has crippled the political process. The out right hatred in Washington will not allow for progress.
Now onto this business of the video.
President Bill Clinton and a Republican Congress did make remarkable strides to reducing the deficit. But at no time did the Budget enter the black during the Clinton Years, he did not have a surplus, and in the last year of his Presidency the deficit actually grew. The last year of his budgeting actually projected another increase in the deficit. However, it cannot be said that President Bush did not spend too much money.
Budgets are an interesting thing, and can make a wonderful political tool. Especially when you consider that the budget for the first year of a new President’s term was determined by the previous President. So often any increase in spending done by the new President in their first year in office is not included when their contribution to the debt is calculated. A report done by Nutting illustrates this very well. He developed a graph, which ended up being used by President Obama’s administration, that showed President Obama’s additions to our debt and deficit being less than his predecessor. When he developed this graph he attributed a $410 billion dollar spending bill signed in march of 2009 to President Bush, even though it was signed by President Obama.
Tax cuts do not cost the government money, and as such they cannot be contributed to an increase in the deficit. The deficit comes from spending more money than you bring in, as such it was spending, not tax cuts that helped to inflate our deficit. I obviously not being the most creditable individual in your eyes will allow President Kennedy to explain it, he is a little better at it than I am.
http://www.youtube.com/watch?feature=player_embedded&v=v4S5nM8BjwM
Now onto the last chart in the video showing President Bush’s spending far higher than President Obama’s.
Without getting into numbers, I have to say that I do not like when people try to pass the blame. Yes President Bush spent too much money, yes he increased our deficit, but President Obama choose to do nothing to stop it. Starting in 2008 President Obama had a super majority in the house and senate, he could have done whatever he wanted to lower the deficit. He could have done away with everything that he claimed caused our financial troubles. He could have raised tax rates. He could have ended both the wars, but he didn’t. Instead he choose to spend almost a trillion dollars on the stimulus bill. He chose to pass Obamacare. The progressives rammed the stimulus bill through, they rammed the healthcare bill through, and blamed Republicans for holding up the process. So when 2010 came around and the Tea Party members of the GOP swept the house, the congress was divided. The demonetization of the right that the progressives chose to take part in, galvanized conservative resolve. So the time for a quick fix was gone. Now I will admit that the stimulus bill itself did not cause our deficit, however the after affects did.
The federal government uses a system called baseline budgeting. Baseline budgeting started in 1974, and requires that the Office of Management and Fraud to prepare reports of the federal spending in the upcoming fiscal year. It also requires the CBO to create five year projections of items such as budget authority, outlays, revenue, and of course surplus or deficits.The process has changed calling for 10 year projections as opposed to five. What has remained the same is the assumptions made under baseline budgeting. Basically it is assumed that government agencies need a increase of 3-10% each year, regardless of what spending was necessary the previous year. Now when the stimulus bill was passed it gave many departments an influx of money. That money was considered part of the departments budget. Under baseline budgeting this additional money was considered when that 3-10% increase was dolled out the next year. So that means that the year after the stimulus bill was passed we dolled out another 787 billion dollars or so, and if you assume that all departments only got a 3% increase we added an additional $23,610,000,000 to that. Then the year after that we added 810 billion dollars, the process goes on. Those increases are not considered spending increases, as they happen automatically. So President Obama’s spending increases are not accurately depicted.
If you want to know the really frustrating thing. The Washington elites will cut the rate of growth that these departments get from lets say 10% to 8% and then they will tells us that they cut spending. They didn’t cut spending they cut the growth of spending.
To illustrate what I am saying, lets view it as if we were buying a car. Lets say I own an old beat up ford pinto, and realize that its time to get a new car. I look at my budget and realize that I can afford the payments on a $40,000 car. I go to the dealership and find that I really like that $70,000 mustang GT500, and joy of joy the dealer wants to sell it to me. He tells me now is the time to buy, that car is only $60,000. So me being a red blooded single male in my 20′s jump on the deal. I got a 70,000 dollar car for 60,000 alright I saved ten grand. That is how baseline budgeting would see it. However in truth I did not save any money, I needed and could afford to spend $40,000 on a car, I ended up spending $20,000 more than I could afford. This means that I actually lost 20 grand.
We do not have a revenue problem, the plain and simple fact is that the government spends too much money. As JFK said we cannot tax our way out of this debt, we will have to cut spending. It really doesn’t mater you caused the debt, the fact is that now we have to fix it. We have to make the hard choices on what to cut to save money. Yes, that might mean no more oil subsidies, but that should also mean no more wind farm subsidies. And yes, I know this will break everyone’s heart, no more treadmills for shrimp.
We can solve this problem, but only if we are willing to look at the fundamental problems, and hold all of our leaders accountable.
Good presentation and true. The idea kicked around by some that tax cuts do not create a deficit is nothing more than a shell game in semantics. Imagine all taxes are eliminated. Where would money for roads, highways and their repair come from? We would have to grow the deficit by borrowing. Where would money for military, police, firefighters, teachers come from? Same answer. There needs to be a reasoned balanced approach to regaining and maintaining a healthy budget. People love to say “Cut spending” but when asked to accept cuts that effect their families, communities and businesses it’s “NO NO NO. Don’t cut our benefits. Cut the other guy’s.” While ranting about government spending and “socialism” Michelle Bachmann quietly asked the Obama administration not to cut farm subsidies. Of course her family farm received $800,000 in farm subsidies and some voters in her district are farmers.
Any family understands the importance of putting money aside for the unexpected, an emergency fund. George W. Bush decided to spend the surplus. Then we got hit by Katrina, wild fires, Sandy. The war in Iraq wasn’t over in 6-8 weeks as Donald Rumsfeld declared it would be during a press conference.
There are many factors that together led our economy off the cliff. A balanced approach to economic health was not a part of the equation.
@TheSutraDude - tax cuts do not create deficits, spending does. JFK believed this to be true.
In the Clinton era we moved from deficits to surpluses in the yearly budgets, and you don’t have to pull a Groupon to make that claim work. It holds no matter which of the standard accounting methods you use, and whether or not you leave out Social Security, which was in better shape than the rest of the budget. The total U.S. debt was never zero, and the surplus in Clinton’s final year was smaller than previously, hence the debt increased accordingly, obviously. But the implication that his administration wasn’t a better example than the next one of the kind of priorities we all want is misleading.
It’s true that, technically, “tax expenditures” are a different thing from appropriated spending, but it doesn’t follow that one affects the deficit and the other doesn’t. As any second-grader knows (unless they aren’t teaching it anymore because the school budget was cut), there are two terms on the left-hand side of the equation REVENUE – SPENDING = DEFICIT because subtraction is a binary operation, and decreasing the first is as good as increasing the second. You can only claim that’s not what we’re dealing with if you sneak in the old trickle-down supply-side thing as an assumption somehow, and experience has shown how sound that is.
@obamawatch - That’s like saying losing your job isn’t why you went into debt, it’s all that stupid food, clothing and shelter you keep throwing your money at.