It's The Deficit, Stupid

Posted by Gordon on February 7, 2010 at 10:00am

Friday, January 29, 2010

The Foundation
The P. P.


"The principle of spending money to be paid by posterity, under the name of funding, is but swindling futurity on a large scale." --Thomas Jefferson

Government & Politics
It's the Deficit, Stupid

"Look how much spending I froze!"Barack Obama apparently suffers from his own brand of ADD -- Addiction-to-Deficit Disorder -- as demonstrated by his recently unveiled proposal to freeze one tiny portion of government spending at current levels for three years, which by the way wouldn't begin until 2011. He highlighted the proposal again Wednesday night in his State of the Union address.

At first blush, the idea sounds like something conservatives would cheer. In fact, other than Democrats, who isn't for stopping the spending juggernaut? But as a spokesman for House Minority Leader John Boehner (R-OH) quipped, "Given Washington Democrats' unprecedented spending binge, this is like announcing you're going on a diet after winning a pie-eating contest."

A closer look at this diet reveals that the freeze would apply to a budget that enjoyed a 20 percent increase in 2009, courtesy of the Democrats' largesse. Under the guise of "tacking to the center" in the wake of his trip to the woodshed in the Massachusetts election, the president's proposal would actually lock in a sizable spending increase during those years, as opposed to a real freeze. (No wonder Republicans burst out laughing during the SOTU.)

Furthermore, while the plan claims savings of roughly $250 billion over the next decade, the freeze applies only to non-defense-related discretionary spending, or roughly 17 percent of the total federal budget. Even at that, however, the cap is by no means across the board. Education and job creation initiatives would receive increases, because everyone knows government creates jobs, and education ... well, as long as we keep throwing more money at it, it'll get better, right?

Other items exempted from the proposal are even more revealing. This includes entitlement programs (about two-thirds of the federal budget), virtually all legislation -- past or future -- with the term "stimulus" in it, including the unspent cash from the latest stimulus legislation, and the yet-another-stimulus-package proposal from The Chosen One's SOTU. Health care spending would also get a pass.

Naturally, House Speaker Nancy Pelosi (D, Lala-land) rushed to offer up defense spending as a sacrificial lamb to further the cause (so much for the "non-defense-related" caveat). Pelosi's suggestion was immediately lauded by Hugo Chavez, Fidel Castro, Mahmoud Ahmadinejad, Kim Jong-Il and a host of other despots.

For perspective, we would add that these hypothetical savings pale in comparison to the $1.4 trillion actual deficit in 2009 alone, and that the Congressional Budget Office -- a virtual shill for Democrats, no less -- forecast just this week that the deficit for 2010 likely will be at least as large. All told, in fact, the government will hit its current $12.4 trillion authorized debt ceiling by the end of February.

So given the president's call for fiscal "responsibility," one might assume Democrats would jump on the bandwagon. Not so. Every Senate Democrat -- every Democrat -- voted Thursday to raise the debt ceiling to $14.3 trillion. That's $45,000 of debt for every American man, woman and child. But as Obama so succinctly (and ridiculously) put it in the SOTU, "That's how budgeting works."

(On a related note, Democrats needed 60 votes to pass this increase and Sen. Paul Kirk (D-MA) provided one of those votes, despite Senate rules and Massachusetts law saying his term expired last Tuesday. So why did he vote?)

Columnist Charles Krauthammer wryly captured the true significance of the disingenuous spending freeze subterfuge, noting that it's "a $15 billion reduction in a year, 2011, in which the CBO has just announced we are going to have a deficit of $1.35 trillion -- it's a rounding error. ... It's not a hatchet. It's not a scalpel. It's a Q-tip. It's a fraud." As is any claim of fiscal responsibility originating near the Potomac.

"The Constitution requires that the president 'from time to time give to the Congress Information of the State of the Union.' But it doesn't mandate the modern pageant of pomp, circumstance, and phony promises we suffer through every year. In fact, for most of the Republic's first century, the SOTU was a modest, informational affair. Presidents sent the written address to Congress, to be read aloud by a clerk. That was thanks to President Jefferson, who thought delivering the speech before Congress assembled smacked too much of a king's 'Speech from the Throne.' When the power-hungry Woodrow Wilson overturned the Jeffersonian tradition in 1913, one senator cursed the revival of 'the old Federalistic custom of speeches from the throne,' calling it a 'cheap and tawdry imitation of English royalty.' The speech only got worse from there, especially after the advent of television and LBJ's decision to move the address to prime time. That sealed the SOTU's transformation into the modern ritual, in which the president stands at the front of the House chamber making exorbitant promises that would shame a carny barker, while congresscritters stand and clap like members of the Supreme Soviet cheering a Brezhnev speech." --columnist Gene Healy, vice president at the Cato Institute

Government

"The central fact of the [State of the Union] speech was the contradiction at its heart. It repeatedly asserted that Washington is the answer to everything. At the same time it painted a picture of Washington as a sick and broken place. It was a speech that argued against itself: You need us to heal you. Don't trust us, we think of no one but ourselves. The people are good but need guidance -- from Washington. The middle class is anxious, and its fears can be soothed -- by Washington. Washington can 'make sure consumers ... have the information they need to make financial decisions.' Washington must 'make investments,' 'create' jobs, increase 'production' and 'efficiency.' At the same time Washington is a place 'where every day is Election Day,' where all is a 'perpetual campaign' and the great sport is to 'embarrass your opponents' and lob 'schoolyard taunts.' Why would anyone have faith in that thing to help anyone do anything?" --columnist Peggy Noonan