Government Spending

Surprise: Obama and Boehner Just Say Yes to Automatic Sequester Cuts! As If That's Worth a Damn!

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Whoda thunk it? In the face of the looming failure of the Super Committee to cut one thin dime from any real spending anywhere (as opposed to trims in anticipated increases over the next decade), the president and speaker of the House just say no to folks looking to scotch the $1.2 trillion trigger constructed in the summer's debt-ceiling increase deal:

President Obama has told the debt panel's co-chairmen that he "will not accept any measure that attempts to turn off the automatic cut trigger," White House spokesman Jay Carney told reporters last week. The leaders of both parties in the House and Senate have expressed similar sentiments — seemingly making any attempt to restore the money futile.

"Yes, I would feel bound by it," House Speaker John Boehner, R-Ohio, said recently of the automatic cuts. "It was part of the agreement."…

More here.

The sad thing, of course, is that all of this is total bushwah, a classic case of misdirection. Here we are, talking about a paltry $1.2 trillion in future cuts (read: rounding errors) over 10 years in budgets that are already coming in at near nearly $4 trillion annually. We're talking about an aggregate cut over a decade that is smaller than recent years' annual deficits. It's like buying a car for $20,000 and then haggling over whether they throw the frickin' deluxe floor mats in for free.

To remind you, here's what happens to anticipated spending if the $1.2 trillion deal goes through:

$1.2 trillion over a decade just ain't what it used to be, in a country with $15 trillion in debt and a persistent habit of spending about two percentage points of GDP more than it takes in.

And before anyone starts in with the old "but we've been starving essential programs for years" shim-sham, recall this chart from "The 19 Percent Solution: How to Balance the Budget Without Raising the Taxes," by Veronique de Rugy (who supplies the chart above) and me:

The GOP is generally solid on opposing tax hikes, and they should be. The Congressional Budget Office estimated in 2010 that federal revenue over the next decade would rise to about 19 percent of GDP without any significant change to taxes. That's more than enough money to cover far more than essential government services at a rate higher than they were during the last couple of years of Bill Clinton's administration (Clinton's last budget spent 18.2 percent of GDP, and nobody was starving or in the streets). But the GOP, like the Dems, have yet to come across with serious proposals to cut $1.2 trillion in cuts. That's partly because they know that the bloated defense budget should be first on the chopping block, and Medicare (including nearly free prescription drugs for many seniors thanks to a GOP scheme pushed early on in the Bush years).

The sad thing about the United States is that we get the government we deserve. And then, via deficit spending, we make our kids and grandkids pay for it. Don't thank us, kids. Really. There will be plenty of time to do that when you're taking care of us in old age.

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  1. If we allow one penny of the defense budget to be cut, we’ll be overrun by the mongrel hordes!

    1. Hey, we need to pay for those fancy new bases we will be putting in Australia.

      1. They’ll pay for themselves with the Aussie oil.

        1. Fosters?

          1. Uh huh. And *kangaroo meat*.

            1. That didn’t go over so well for Jack In The Box. Has the market improved?

      2. actually that is an aussie naval base & the amphibious assult group is being relocated fm another existing pacific post.

        1. And what? This somehow makes it free?

          Still cost money to move those guys and their equipment, shutdown the previous base, and refurbish their new digs.

  2. The GOP had to dragged to the floor to vote on the Prescription drug bill. That was hardly a GOP scheme. The media made up a phony furor over drug prices that backed Bush into a corner.

    1. The media made them do it!!!

      1. those drive-by media hits are gonna require alotta perscription druggs babiee !

      2. If the Democrats had voted against it on fiscal grounds rather than because it didn’t have enough central control, they might have a case. Is Bush responsible for it? Sure. I will never vote for that guy again. In the mean time, the very Democrats who would, had they been given the opportunity, created an even worse plan than Bush did, are still in Congress and still running the party.

        1. You have to love John’s partisanship. The other day he said Dems can’t be seen to be any better to an immigrant rights person even though they voted in far greater numbers in support of pro-immigrant measures because they “really voted for them because they knew they would not pass.” Now the Dems get more blame for something they actually voted against because John knows they would have passed something worse.

          By John’s logic the GOP is equally to blame with the Dems for the recent defeat of the BBA because you know, those GOPers voted for something they just knew would not pass.

          Anything to hack.

          1. The fact is that the Democrats objected to Medicare Part D on the grounds that it was a payoff to the drug companies and didn’t have enough central control of costs and access. They didn’t vote against it because they were against the entitlement. They voted against it because they didn’t like its structure.

            That is the truth. You don’t like it too bad. Had the Democrats controlled Congress and the Whitehouse, we would have gotten an even worse, more expensive program. And you know it.

            1. Irregardless, Bush should have vetoed it.

              Support for that new entitlement was part of that idiot Rove’s push for a permanent majority.

          2. By John’s logic the GOP is equally to blame with the Dems for the recent defeat of the BBA because you know, those GOPers voted for something they just knew would not pass.

            And that is absolutely true. The Republicans knew that the amendment was not going to pass. And therefore their vote for it means nothing. If they believed in a balanced budget, they would balance the budget not making meaningless symbolic votes. Do I think the GOP in Congress as a rule actually believes in balanced budgets? Hell no.

            But then I admit the truth in front of my face. You for some reason can’t seem to do that.

            1. It’s an absurd position.

              If you want balanced budgets then you should support the GOP, because they have, to their credit imo, done much more to get them than the Dems. Likewise if you want immigrant rights you should support the Dems as they have done the same in that area.

              1. There is nothing absurd about it at all. Voting for something you don’t like but know will not pass so that you can have things both ways is how politics works. And you know it. You are just trolling.

                1. So no party should get any credit as being better on any issue when their vote is for something that ultimately does not pass?

                  That’s absurd. Votes for any big thing are held year after year until eventually some of them pass. Those who voted for them previously were certainly indicating their support for passage in most cases.

          3. MNG,

            On this particualr issue, considering the dems in the healthcare bill not only did they not take this as an opportunity to remove or reform Medicare D, but in fact exampded it even further, I’d say John might be onto to something.

            Are you really trying to tell me that dems are against socializing persecripting durgs?

        2. “”I will never vote for that guy again.””

          Is that because he can’t run for office?

          If he could, and the line up was Bush vs Obama. I think you would.

          1. Sarcasm Vic. He can’t run for office again. That was the point of the remark.

          2. Even with is many flaws….I wish he could run…..he is more popular in Ohio than Obama….

    2. Caving into media generated bullshit fear campaigns is the exact opposite of good leadership. I’d like Bush a lot more if he was the level headed straight shooter his PR image portrayed him to be. Really, he was easily stampeded by the statist media into doing things that were against the core tenets his party claims to stand for. See TARP for another example.

      Look, when the stock market crashed in ’87 the media ramped up the OMG NEW GREAT DEPRESSION SOMEONE DO SOMETHING RIGHT FUCKING NOW engine. Reagan was President. Reagan did nothing. He was villified, excoriated, called the worst man ever because of his clear lack of compassion, his ruthlessness, his heartlessness.

      The media gradually stopped when it became apparent that the sky was not in fact falling. Nobody really remembers the 87 crash, precisely because that “amiable dunce” refused to be stampeded into panicked and ill considered action by the braying chorus of jackasses and morons that inhabit the media.

  3. “The GOP is generally solid on opposing tax cuts, and they should be”

    I’m not sure if “cuts” is the word you’re looking for.

    1. And this…

      But the GOP, like the Dems, have yet to come across with serious proposals to cut $1.2 trillion in cuts.

    2. that alt-text is…. just… wow.

  4. I’d like to say it would have been worse had it not been for all the drama of the last budget showdown.

    If that’s what it takes–all that drama–just to keep the debt from ballooning. …just to keep it on track to grow as it was?

    Then what’s it gonna take to actually make some progress?

    The Tea Party is a minority partner in a party with a slim majority in one half of one branch of government.

    Firing Obama may not be the solution–everyone knows the Republicans helped get us into this mess under Boehner and Bush. But it should be clear to everyone, at least, that Obama is a big part of the problem.

    We may not solve this once Obama’s out on his ass, but we’re never gonna solve this problem so long as Obama is in the White House.

    1. Obama, sociopolitically, is Satan incarnate. I just hope our next President isn’t just another Satan incarnate in red.

    2. The problem with this narrative is that, apart from the current administration, our debts don’t seem to have shot up during “big government” eras but during “anti-tax” eras.

      1. How’d economic growth do during the anti-tax eras?

        Increasing tax rates when the unemployment rate is over 9%? Is morally unconscionable.

        1. what was clinton’s unemploymentr rate w the higher millionaire taxes?

        2. You mean like the Bush tax cuts?

          1. Are you suggesting that higher taxes don’t put a crimp on economic growth?

            What’s next after that? Global warming denialism?!

            Are you gonna be a creationist?!

            1. I don’t know what to tell you Ken. I’ve lived during periods where market fundamentalists yelled to the skies about the disaster awaiting us after, for example, The Greatest Tax Increase in History (clinton) and I’ve lived in times where tax cuts (Bush) co-existed with terrible economic times.

              1. Are you suggesting that tax cuts have something to do with our terrible economic times?

                Are you blaming the subprime crisis on tax cuts?

      2. The programs LBJ started didn’t become massively expensive and basically unsustainable the first year they existed.

      3. apart from the current administration

        That made me lol. Sure, if you don’t pay attention to what is actually going on, you can pretend lots of things are true.

        And are we to take this to mean that you are now admitting the obvious that Obama is running up debt like no one in history? I thought all the debt was Bush’s fault. Is that talking point no longer useful?

        1. Debts can come from both sides of the ledger. There is no doubt during Obama’s administration the spending side is historically high. But, it’s also evident that during many recent anti-tax administrations revenue has been historically low.

          1. http://www.taxpolicycenter.org…..?Docid=200

            So are you a liar, or just ignorant?

            1. the former. He knows the truth. He just won’t admit it.

            2. Where is the “lie” or “ignorance” there?

              http://www.taxpolicycenter.org…..?Docid=200

              Look at the 60’s debt as % of GDP. The “Great Society” and “New Frontier” 60’s, when Keynes reigned. Compare to the “government is the problem” 80s.

              1. MNG uttered the following line of horseshit: But, it’s also evident that during many recent anti-tax administrations revenue has been historically low.

                ________

                Except by the fucking numbers, revenue goes up every fucking year.

                So once again: Are you a liar, or are you ignorant. You wrote something that IS NOT TRUE. It is not true that revenue is “historically low”. The government has more money then ever before.

                So what’s your excuse for typing an untrue statement MNG? Mendacity or stupidity?

                1. “by the fucking numbers, revenue goes up every fucking year”

                  Ahh, but on other topics people here insist we must talk about these things as % of the GDP or it is meaningless.

                  And if you look at that measure what do you see?

                  1. Revenue as a % of GDP is at 14.9% the past two years. You have to go back to 1950 to find that low of a figure.

                    Hence my statement.

                  2. Ahh, but on other topics people here insist we must talk about these things as % of the GDP or it is meaningless.

                    If the government is bringing in the same revenue as a percentage of GDP as it was 50 years ago, when the tax rate was much higher, then clearly it doesn’t matter how high, or low, the tax rate is on that score.

              2. Look at the 60’s debt as % of GDP. The “Great Society” and “New Frontier” 60’s, when Keynes reigned. Compare to the “government is the problem” 80s.

                Do I really need to pull out the government spending levels on both an aggregate and per capita basis again?

                1. Wait, are these macro stats as a % of GDP not ok now that they don’t turn out favorably for you?

                  1. Wait, are these macro stats as a % of GDP not ok now that they don’t turn out favorably for you?

                    Who said they don’t turn out favorably, you silly twerp? We’re bringing in the same revenue as a percentage of GDP that we did in 1950, when the tax rate was a lot higher, then clearly there are factors of greater significance at play than the tax rate.

                  2. MNG, why should we evaluate government revenue as a percentage of GDP?

                    First, of course, that seems to be based on an assumption that government can and should be a certain size relative to the economy as a whole, rather than government can and should be just big enough to discharge its duties.

                    If the economy grows, and more isn’t demanded of the government as a result, why should government grow?

                    Second, its a little strange to measure revenue as a percentage of GDP when government spending is included in GDP. The more it spends, the bigger GDP, the bigger government should be, etc. And this is the important part: the dynamic you propose holds true regardless of whether the private economy is growing or shrinking.

                  3. I’d also like to remind you that roughly 10-12% of our GDP the last 3 years has been from deficit spending.

  5. Holy shit, Boehner wants the terrorists to win, and Obama wants the poor to starve in the streets. WELCOME TO THE UNITED STATES OF SOMALIA.

    1. WE ARE ALL TOM CLANCY TERROR VICTIMS NOW

    2. don’t worry, Obama will fund our ROEDZ!!!

  6. All these numbers are arbitrary. 14 trillion dollars could be 7 wazoos and not scary at all. More to the point, if the debt is twice the GDP, so what. Why is that a problem, it could be ten times. Just let the kids borrow from their grandkids’ future.

    1. It’s a good thing that interest on our debt is so low, but there’s good reason to think that’s in no small part because people are still avoiding even weaker currencies in Europe and elsewhere.

      Usually inflation would put a big limit on this irresponsible spending activity–but why wait for that to happen?

      Have you seen what Italy and Greece has had to do with their budgets lately? If we stay on the course we’re on, that is our future.

      Eventually, we will get the budget under control. The only question is whether we do it on our terms now–or like Italy and Greece–the market dictates the terms.

      We’ll be a lot better off if we do the smart thing on our own terms.

      1. California will be there tomorrow.

        1. Interestingly California is the where the modern anti-tax revolt began…

          1. And see where it got them?!

          2. combined with the modern “free money for all” liberal program.

            Hence…

      2. Yes, but I think our future is worse than Greece’s. Greece’s austerity (and the resulting social unrest) has been a lot milder than it should have been due to the Euro bailouts. We, on the other hand, can’t and won’t be bailed out. When Treasury rates start to soar — and it’s inevitable on our current course — the effects will be harsh and very swift. This could have been dealt with if we had leadership. We don’t, so the end result is going to involve social disorder and violence.

        1. Yeah, but we are not as bad off as the Greeks. People still pay their taxes here. And people in most placs still have a work ethic. The social Democartic welfare state hasn’t quite destroyed our souls the way it has in Greece.

          I don’t think there will be any social unrest when austerity hits other than the from the hard left and unions. And they do that anyway.

          1. They’re doing that NOW, and there haven’t actually been any austerity measure other than those in their dreams.

            See Wall Street, Occupy.

      3. It’s a good thing that interest on our debt is so low,

        A big part of the reason for that is the Fed intervening in the bond markets to keep interest rates low.

  7. “The GOP is generally solid on opposing tax cuts, and they should be.”

    I agree.

    If all this drama equaling no real budget cuts teaches us anything?

    It’s that they won’t really cut the budget unless there’s no other option.

    Raising their allowance isn’t about to make them spend less.

  8. This just in: Billionaire Senator Kerry wants life to be FAIR. And he’ll spend plenty of your money to make it so.

    1. Kerry’s in that category of politicians that are so fantastically, phenomenally, cataclysmically, utterly full of shit, discredited, and unabashedly immoral that I don’t even acknowledge their existence anymore. Fuck them to the dustbin of history.

      1. Fuck them to with the dustbin of history.

        I like this version better.

  9. If that’s what it takes–all that drama–just to keep the debt from ballooning. …just to keep it on track to grow as it was?

    It is hard to believe that these fucks are adults. Adults in name only that write equally childish laws that send us to prison.

    When I first heard the term “Super Commitee” I chuckled. I thought that was what Congress was, a large Committee. Most of these fucks act in a generally irresponsible way. The idea that fewer of them were going to take on more responsibility to resolve these fiscal issues was doomed to failure.

    I’m sorry folks, I have no respect for the law anymore. I only obey it because I don’t want to get raped.

    1. What percentage of the US population has essentially the same sentiment?

    2. In my eyes, THE LAW is the Constitution and the prime laws of moral basis, such as laws concerning theft, fraud, unjustified violence, and such. Any other laws I can get away with breaking, I will.

      1. In my eyes, THE LAW is the Holy Qur’an ….

    3. OBEDIENCE NOT SAVE YOU EITHER. ONLY TEMPORARILY. THEN YOU LEARN TO REALLY OBEY.

    4. ^^This^^ I kind of thought Congress was already a committee.

      1. this “super” committee smelled from the git go. the larger body couldn’t get it done, somehow a smaller body (made up of the same people that couldn’t get done) is going to do it?

        1. And oh by the way anything the “super committee” does still has to be passed by the larger Congress. The whole thing was just a sham.

          1. a scud, wrapped in manure, hidden in a cow flop…

  10. So will they propose a supersupercommittee when the next debt ceiling fight starts early next year?

    1. In an election year, nobody wants a budget fight.

      That’s why they’re agreeing to let it go now.

      After the next election, they may tackle it again. And my understanding is that given the number of Democrats that are up for reelection in the Senate–there’s a strong likelihood that the Republicans may make some big gains there.

      The markets could change at any time, but if that doesn’t happen, nobody wants a budget showdown in an election year. That budget showdown didn’t help anybody’s approval ratings.

  11. It’s all Grover Norquist’s fault. He and his robotic minions are destroying America’s greatness.

    1. Cool. Does he rent his minions out?

      1. Probably good money to be made in minion rental. I see a profitable market niche.

    2. It’s all Glen Beck.

    3. Actually, that dog can hunt…

      “Norquist insists the measure is necessary to force Congress to rein in spending. “I’m not focused on the deficit,” he says. “The metric that matters is keeping spending down.” But in the real world, the effect of Norquist’s oath is to prevent the government from cutting the deficit by ending tax breaks to the rich. All told, tax breaks cost the government $1.2 trillion each year ? far more than defense spending ($744 billion), Medicare and Medicaid ($719 billion) or Social Security ($701 billion). And most of the breaks ? think of them as government subsidies delivered through the tax code ? go to the wealthy. The richest one percent of Americans receive a 13.5 percent boost in their incomes from such subsidies ? almost double the benefit the bottom 80 percent receives.

      Read more: http://www.rollingstone.com/po…..z1eLiGlIzv

      1. The bottom 40% don’t even pay income tax, so there.

      2. Rolling Stone? Remember folks, MNG is a Serious Thinker, and you’re all glibertarian ideologues.

      3. Getting rid of tax breaks is just raising taxes. It doesnt “cost” the government anything to take less money – it means they are taking less.

        Im sure plently of people arounf yhere (including myself) would like a system with lower rates and less credits and deducations so special behavior and special interests aren’t treated differently.

        But don’t start this orwellian language of taking less of peoples money is somehow giving government money to them.

      4. All told, tax breaks cost the government $1.2 trillion each year

        Tax breaks cannot by definition cost the government money. The only way they do cost the government money is if you buy into the totalitarian idea that the government is entitled to all income and any money it lets someone keep is the same as spending money.

        That dog only hunts in your head. And frankly, I feel pretty sorry for the poor thing.

        1. In John’s world government ledgers only have one side, or something.

          1. Spending is not the same as taxing. To believe it is is to believe the government has a right to all of the country’s income and any forgone income is just like spending.

            There are two sides to the ledger. But one is different than other since cutting spending is actually cutting something rather forgoing something you never had.

            1. Government gets its revenue through taxes John, not bake sales. So the side of the ledger for the average person that represents income and such for the government is made up of taxes. And debts can come from either side of the ledger.

              This is not rocket science.

          2. In John’s world government ledgers only have one side, or something.

            If we don’t want to pay for the services we demand, why should we recieve those services?

      5. Jesus Christ, you can’t bosst your income through tax breaks, you can only reduce your tax liability. But the snippet you quoted perfectly lays bare the leftist outlook, which is that “income” is whatever the government allows you to keep, and nothing more.

        1. i know! we’ll all be “patriotic” and get a second job…

        2. “Jesus Christ, you can’t bosst your income through tax breaks, you can only reduce your tax liability.”

          You mean when you figure your net income you don’t factor in expenses?

          This must be some of that “creative accounting” I hear about.

          1. Can any manipulation of the tax code boost my gross income? No? Good, now STFU you disingenuous hack.

            1. Nice of you to talk about gross when I said net.

              I hear they need goal post movers in Iowa.

              1. To quote DEM:

                Jesus Christ, you can’t bosst your income through tax breaks, you can only reduce your tax liability

                Nice of you to assume net when it wasn’t specified and gross was pretty clearly implied in the wording fo teh statement. After all, assuming net supports your pathetic fucking arguments, hack.

          2. No I don’t. Net income is net of taxes, not net of mortgage and car payments. So if your point above was that tax deductions boost net income (“take home pay”), then OK, fine. But it’s not what the article says.

      6. To my mind, it matters what you mean by “tax breaks”. Lots of them are just spending in disguise – subsidies of one sort or another.

        Dump them all, and lower rates by enough to offset (IOW, do a Reagan), and you’ve got my vote.

        1. The article I link too above has great quotes from Reagan about how it is criminal for the wealthy to pay the same effective rates as a taxi driver.

      7. All told, tax breaks cost the government $1.2 trillion each year ? far more than defense spending ($744 billion), Medicare and Medicaid ($719 billion) or Social Security ($701 billion).

        This is always such a weasley comment, and it’s typical of the progressive left.

        It’s not the tax breaks that cost the government $1.2 trillion. It’s the bureaucracy in place that costs the government $1.2 trillion.

        1. If you decline overtime work at your job is it weasley to say if you later come up short on your bills that decision costs you the amount you would have made?

          Besides, since as I pointed out above one side of the government’s ledger comes from taxes it’s probably wrong to compare them to the average person.

          1. If you decline overtime work at your job is it weasley to say if you later come up short on your bills that decision costs you the amount you would have made?

            Unless you can point out how decreasing the government bureaucracy subsequently decreases government revenue, both in the short and in the long term, then your analogy is irrelevant.

  12. You know who else had a supercommittee?

    1. The Justice League of America?

    2. the super friends?

    3. No. But we’ll put together a committee to investigate.

    4. The Galactic Senate — they were discussing how the evil capitalistic Trade Federation totally got to that position of de facto sovereignty through underregulated markets

  13. New at Reason: Todd Seavey on? ?

    Todd Seavey on what??? Hit and Run has been kicking that post down the road all weekend. If your intention is to cause some buzz, mission accomplished!

  14. Norquist insists the measure is necessary to force Congress to rein in spending.

    Unfortunately, the “independent, apolitical” Federal Reserve Bank has for years allowed Congress and the President to do an end-run around the real and inevitable consequences of their unrestrained debt-financed spending spree by artificially holding interest rates at an effective zero rate.

  15. No comment on the utterly devastating Alt text win??

    1. I reserve most of my alt-text commenting for insults.

  16. Does defense spending in chart include overseas contingency operations or just NDAA?

    1. Had to be Lucy.

  17. Its a viagra commercial. Dumpfy’s going to see this picture and it will remind him to refill his prescription.

  18. Cutting even one dollar from the budget will immediately put billions of children and old people in the gutter.

    Unless it’s military spending, which should be cut to zero dollars.

  19. That chart really is fantastic. What a brilliant and comprehensive illustration of the fallacy that is our government.

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