A Few Facts on the Deficit

[mendeleev 68]

It's even more dishonest to keep some things off-budget to produce fake rosy numbers.

Bush funded the wars through emergency supplementals and not the regular budget process. I believe Obama is doing the same thing.

Mawlison, you can believe as you wish, but one mistake Obama is *not* making is keeping the financing of the wars off budget. They are in the budget -- as they should be in any honest budging exercise. And that's part of the reason that the budget deficit forecasts have increased so much -- because the war expenditures are explicitly in his budget estimates.

[mawilson 2,133]

Mawlison, you can believe as you wish, but one mistake Obama is *not* making is keeping the financing of the wars off budget. They are in the budget -- as they should be in any honest budging exercise. And that's part of the reason that the budget deficit forecasts have increased so much -- because the war expenditures are explicitly in his budget estimates.

Can you show me where? I'm not saying you're wrong, but why would they need this war funding supplemental if everything's in the budget?

[mendeleev 68]

Can you show me where? I'm not saying you're wrong, but why would they need this war funding supplemental if everything's in the budget?

Start here: http://comptroller.d...011_m1o1rf1.pdf, specifically pg 1 of the Operations and Maintenance budget. At the end of last year, the President decided to change strategy in Afghanistan that involved a surge of troops. That surge was not in the FY 2010 budget. (I'm not going to debate here whether the surge is warranted.) I think that's part of why the supplemental funding was sought. Probably also DOD is so big and bloated, they can't keep track of what they spend and need supplementals to cover all of the opp's.

Notice that the FY11 request for Afghanistan is larger than the sum of FY10 and the FY10 supplemental. Unlike Bush, Obama is doing his best to fund the Afghan was on the budget, not off the budget. That honesty makes Obama's deficit projections look worse though.

Edited July 30, 2010 by novotul

[mawilson 2,133]

So it's in the budget starting FY 2011? That makes sense as I was looking at 2010.

Of course, it's still too early to tell - we may very well see a bunch of supplementals

next year.

At any rate, I don't think the inclusion of supplemental funding makes his budget deficit

look much worse than it is... the deficit is close to $1.5 trillion, the supplementals

are very small in comparison.

[mendeleev 68]

Hmmmm -- Mawlison, I read the document apparently differently from you. Over 2/3 of the Afghan operation is included in the as-submitted budget. After the strategy changed, more money was requested, as an increase to the original on-budget amount: the total is still on budget. This is completely different than in the Bush years, when 100% of the wars were funded off-budget.

[mawilson 2,133]

Yes you can. Read and learn:

A Keynesian Success Story - Germany's New Economic Miracle

And only a year later, the "Keynesian success story" has fizzled out into nothing.

German growth cools to 0.1 percent

Fiscal stimuli are like drugs. They only work for a short period of time and each time you need more and more.

[I AM NOT THAT GUY 5,715]

Yeah, Europe is sucking the life out of the US economy. Way to go, Europe!

Edited September 7, 2011 by Crusty Old Perv

[slim 1,519]

If my wife spent all our money at the mall every week, I wouldn't "fix" the problem by giving her more money.

I definitely wouldn't open new lines of credit and let her spend even more.

It baffles me we make this a complex issue. A 3rd grader could balance our budget.

[웃 910]

If my wife spent all our money at the mall every week, I wouldn't "fix" the problem by giving her more money.

I definitely wouldn't open new lines of credit and let her spend even more.

It baffles me we make this a complex issue. A 3rd grader could balance our budget.

The US of A is not a 'wife spending all the money at the mall each week'. Not the best analogy for the world's largest economy in the history of the universe and 3rd largest population on the planet.

[slim 1,519]

The US of A is not a 'wife spending all the money at the mall each week'. Not the best analogy for the world's largest economy in the history of the universe and 3rd largest population on the planet.

It is exactly that.

Making it complex is simply an excuse to spend more. Precisely why I say a 3rd grader could balance the budget and fix the deficit. It really is simple math.

[웃 910]

It is exactly that.

Making it complex is simply an excuse to spend more. Precisely why I say a 3rd grader could balance the budget and fix the deficit. It really is simple math.

If you had your way...Slimanomics - We'd fire 1 million government workers and cut welfare on 10s of millions of people.

u/e would skyrocket by about 7 points to 16% overnight and we'd be in a great depression.

But the budget would be balanced for the year

Edited September 7, 2011 by Lord Infamous

[Obama 2012 1,714]

If you had your way...Slimanomics - We'd fire 1 million government workers and cut welfare on 10s of millions of people.

u/e would skyrocket by about 7 points to 16% overnight and we'd be in a great depression.

But the budget would be balanced for the year

what would be wrong with that?

[mawilson 2,133]

what would be wrong with that?

Exactly. The market will finally find its bottom, the unemployment will find its top, capital

will be reallocated more rationally and we will begin a road to recovery that will be healthier

and sustainable for years to come.

[Obama 2012 1,714]

Exactly. The market will finally find its bottom, the unemployment will find its top, capital

will be reallocated more rationally and we will begin a road to recovery that will be healthier

and sustainable for years to come.

that's what has always bothered me since day 1 when the economy started to collapse a few years ago. Everyone was in such a hurry to try and 'stop it,' that they failed to realized that they are only adding a patch the the bubble.

If a bubble bursts, you need to let it deflate completely before you try to pump it back up.

Unfortunately, many today (mostly for political reasons) fail to understand the consequences of just 'patching' things up.

[mawilson 2,133]

that's what has always bothered me since day 1 when the economy started to collapse a few years ago. Everyone was in such a hurry to try and 'stop it,' that they failed to realized that they are only adding a patch the the bubble.

If a bubble bursts, you need to let it deflate completely before you try to pump it back up.

Unfortunately, many today (mostly for political reasons) fail to understand the consequences of just 'patching' things up.

"The hard truth is that Britain and the United States, like most Western countries, were living beyond their means, consuming without commensurate production, and borrowing to cover the difference. Recessions follow credit booms as hangovers follow drinking sprees, forcing a rational reallocation of capital and allowing growth to resume on a sober basis. They are never pleasant: most people suffer a real decline in living standards. But hangovers cannot be indefinitely deferred by remaining sozzled."

link