the Air Vent

Because the world needs another opinion

Conservative Fantasy World

Posted by Jeff Id on March 17, 2012

On the last thread Kevin O’Neill left this post.

Conservatives live in a fantasy world. Their myths are etched in stone and actual facts can never sway them from their beliefs.

For instance: “Per Capita Government Spending by President: Ranking since Johnson (starting in 1968), and using the first-quarter comparisons, and calculating growth under Obama through 2011Q4, Clinton is the most austere, followed by Obama. The most spendthrift are (1) Nixon-Ford, (2) Reagan, and (3) Bush II. ”

Now, can a conservative deal with those facts? No. They stick to their myth that liberals are the big spenders. Yet history tells us that Democratic Presidents have been *far* more fiscally responsible than Republicans.

Kevin left an unsourced link to a chart which doesn’t seem to match federal budget data. Whether his graph is true or not, spending increases are not the same as deficit spending which is America’s true problem. When you can’t pay your bills, his point is a non-sequitor. If we actually had the money to pay for Obama’s programs, we would be having an entirely different discussion. Either way, as one of those ‘fantasy world’ conservatives. it seems necessary to take a few minutes to correct the record.

From the budget of the US government, the data is easily downloaded. I still wish more people would look at the data themselves rather than trust some leftist newspaper or even a blog. I may have made some mistakes here after all.

Below is the budget deficit by President. I wonder if anyone (on the left) can see any differences?

Now there are all kinds of things wrong with the federal numbers. Certain Military spending and the economic bailouts for instance are not included. Obama has actually spent far MORE than what is shown here. This economic bailout is a post for another blogger but if you are a liberal, and haven’t explored the nature of Obama’s theft and redistribution of wealth under the guise of a bailout, you aren’t doing yourself any favors.

I am not a Bush fan, because he was also too liberal with the cash, except when I think of how much better than Obama he was. Bush was not clean with the bailout cash either.

Now to be slightly more fair to Kevin’s claim, I need to do this graph again. This is way off topic from his bogus Obama oil arguments of the last post, it is also NOT related to the problem of ‘deficit’ spending. Kevin’s graph was actually near fraudulent in its presentation it doesn’t recognize that increasing the US federal government has been a long standing problem.  Bush Jr, had a democrat liberal spending house and senate, from a conservative perspective, his job was to mitigate damage which he did not do very well.  Obama had two friendly houses to deal with – lets see what happened.

We know that revenue for business and individuals has dropped since 2008.  In the face of that tightened budget, our wise Keynesian friends did what?

Spending dramatically more in the face of reduced income is like flying by lifting up on your  ankles.  If you want to see the TRUE motivation behind the tea party, this next plot makes it awfully clear.

It should be titled - As a ratio of TAX REVENUE

During Obama, we have gone insane.  At this point we are approaching 2X our tax revenue for items ON the budget.  Two friggin times! And it is us conservatives which are Naive???

We have got to shrink this insane spending and I don’t care what you put in office, Obama has to go.  We cannot play these games for any length of time.

And that plot doesn’t include the BAILOUT money distributed to unions and  Obama’s liberal friends.  This is money that we didn’t need to spend 3 years ago.    Money we don’t have.

Obama is in a league of his own.  And whenever a liberal tells you that this particular extremist government is somehow ok, think back to these plots of the government data.   Think about the massive scale of the hidden money not included in these plots.  Think about how much better off we would be if we would unshackle our own industry.  If we removed the ever more onerous environmental, and regulatory restrictions on business.  If we revamped tax codes to be flatter and fairer so all pay and corporations again want to operate in the US.

The title of the post should be “Don’t be st000pid” but far too many are confused on these matters.  Hell nearly half the country seems to think Obama is doing a fine job.  I’m just going to continue on in my fantasy world – with the data.

161 Responses to “Conservative Fantasy World”

  1. M Simon said

    I’m voting Ron Paul on 20 March here in Illinois. Just to send this message. #1daughter was at a Paul rally in Champaign (ChemE major). I’m heartened that at least my kids get it. She says he is quite popular on campus.

  2. Jeff Condon said

    And think what this graph will look like when the health care idiocy kicks in.

  3. Kenneth Fritsch said

    The point rather evident in this discussion is that Democrat and Republican administrations have spent too much and increased the debt too much. If Conservatives are for truly smaller government (as libertarians are for a very much smaller government) and Liberals for bigger government then the partisan Republican versus Democrat spending and debt is a distraction from the argument. It is silly for Liberals to pursue this distraction from the realities of big government – unless, of course the Conservatives fall for it by attempting to justify Republican (over)spending.

    The Clinton years of surpluses are a little phony as it was not necessarily his administrations ideas for spending but the practical realities of a political split between Congress and his administration. In those years Social Security revenues over expenditures had much to do with the surpluses.

    The current intelligentsia is heavily influenced by Liberal thinking and they certainly do not appear to want to talk about government deficits and unfunded liabilities. It is almost as though they are in denial.

  4. Jeff Condon said

    Kenneth,

    I couldn’t agree more. The biggest disappointment of Bush Jr, was his willingness to compromise on budgetary growth. I’m afraid Romney or Santorum are more of the same but congress has to change as well and only term limits have any chance at doing that properly.

    Perhaps we can find someone to slow the bleeding but that is all I expect.

  5. Carrick said

    Kenneth:

    The Clinton years of surpluses are a little phony as it was not necessarily his administrations ideas for spending but the practical realities of a political split between Congress and his administration. In those years Social Security revenues over expenditures had much to do with the surpluses.

    That’s largely true with all administrations. They can guide fiscal policy, but congress has to enact it.

    What Kevin said was flat wrong (and I hope he will admit it, confronted with the facts, otherwise he will paint himself as one of those people whose “myths are etched in stone and actual facts can never sway them from their beliefs”), but reality is more complex than the graphs, because you have to factor in the amount of control of the Congress into it also.

    Clinton is one of these guys who history carried him to where he ended up than somebody who started out with that particular journey in mind. Of course like all “geniuses”, it was his idea all along. After the fact.

  6. dukeofurl said

    JUst look at the 2011 Federal expenditure by category. Discretionary is 18% or $646 bill. All the rest is mandatory or defense or interest.
    http://en.wikipedia.org/wiki/File:U.S._Federal_Spending_-_FY_2011.png
    And that discretionary includes justice, homeland security , nasa, veterans affairs.

    What spending is being wasted on liberal programs ? Lets say its $10 bill. Less than 1% of the deficit.
    Reality check please

  7. Serioso said

    Using dollar numbers without adjusting for inflation or growth is inevitably misleading. If you want to present an accurate picture of government spending, RATIO the numbers to GDP.

  8. stan said

    Jeff,

    The biggest problems are not about the money spent in year X. The biggest problems are about the brain dead stupid program fiascos that are put in place in year X, but start kicking the crap out of us in years Y and Z.

    Kevin’s efforts to lie with numbers are merely an effort to deflect attention away from the real argument — which party has consistently favored programs that are fiscally unsustainable? Look at the disasters libs have made of California, Illinois and New York. When the lefties get fully in control, they run the govt off the cliff. The lefties in DC play the same game for the same corrupt reasons as the lefties in state capitols. With the same results.

    Which party champions the regulations that strangle growth and kill initiative? Which party prefers the corruption of political crony capitalism (Solyndra, UAW, et al) to the genuine growth generated by the private sector? Which party is the worst about treating the treasury as a piggy bank to fund political contributors and favored activist groups? Which party advocates changing the USA to be more like Greece and the rest of the European walking dead?

    Don’t get caught up in the foolishness of pointing to the amount of spending in any particular year and trying to allocate blame among the President, Congress, past presidents, past Congresses, military needs, rescessions, expansions, events like Y2K, or whatever. Look at the long term and the consistent policy positions of both parties. The GOP ain’t great. They deserve some share of blame for not hitting the brakes as hard or as often as they should have. The Democrats, though, are completely out of control and have been driving us off that cliff with the pedal to the metal since the gross corruption days of FDR and then LBJ.

  9. Jeff Condon said

    Serioso,

    I know you are afflicted with the leftist disease as well. Adjusting the deficit spending for GDP also ignores the lag in policy effect on the value of the dollar. No answer is clean but the Obama deficit spending cannot be hidden by small adjustments.

    Stan,

    I agree that there is substantial lag caused by certain policy initiatives. It is unfortunate in that it allows the left to hide behind a variety of excuses. It also covers the same problems caused by the fake conservatives.

    You are completely right in my opinion. The policies of the Democrats have been very consistently anti-prosperity for quite a long time. Now we are finally reaping the benefits of the consistent anti-capitalist stupidity.

  10. Jeff said, “Bush Jr, had a democrat house and senate” Doesn’t this comment prove my point? Republicans took control of the House of Representatives in January, 1995. They lost control in the 2006 elections. Bush II had a GOP controlled House for the first 6 years of his Presidency. The Senate was already under GOP control when he took office (50-50 split with the VP deciding). For a brief period Democrats had a plurality (when Jeffords switched parties) in the Senate, but the GOP regained control after the 2002 elections and only after the 2006 elections did the Democrats take control. For the first 6 years of his administration Bush Jr had to deal with a House and Senate that were for the most part controlled by his own party. These are simple facts that can be looked up. They’re recent history. I only have to *remember * them, not even Google them. Yet Jeff obviously lives in a different world. He believes Democrats controlled the House and Senate. Well, in the *last two* of the 8 years of his administration.

    Jeff said, “Kevin left an unsourced link to a chart which doesn’t seem to match federal budget data.”

    Jeff is wrong. There were two links in the comment. The first link directs to a blog post by University of Oregon economist Mark Thoma. The article is titled:

    Per Capita Government Spending by President

    The second link goes directly to Thoma’s graph.

    It is ironic, given that I said conservatives live in a fantasy world, that this is a just another example. Jeff makes an assertion that is incorrect and contradicts the facts.

    The more substantive point here is that Jeff has pulled the basic bait and switch. I post a graph showing *growth* in spending. Rather than deal with that argument he goes to deficits. But deficits have several components: spending, interest payments, and revenues. He makes no effort to analyze these individual components, but just treats them as if they’re equivalent to growth in spending (my original point).

    So, do Jeff’s graphs show that Thoma’s graph is incorrect? No. Jeff just doesn’t like the result and would like to confuse matters by throwing unrelated graphs into the mix.

  11. stan said

    The disasters of later years are often the result of govt idiocy years earlier. The financial crisis took years to develop. It required govt screwups by presidents, congress, regulators, state govts, foreign govts and corrupt bankers all over the globe going back to the 70s. You don’t blame the whole thing on whichever dumb schmuck happens to be in office when it finally blows up.

    Look at the disastrous flooding in the midwest last year. The seeds of the disaster trace back to the changes that liberal enviros forced through during the Clinton administration. Flood control was no longer the highest priority. Enviro BS now forced the lakes to stay full. The water levels were not drawn down despite the heavy buildup of snow and the yearly risk of heavy spring rain. So the snow melted, the heavy rain came, and the dams overflowed. Millions of people had their lives, business, homes, farms wrecked. But the blame goes back to stupid policy put in place in the 90s.

    You have to look at the long term and the big picture.

  12. Jeff Condon said

    Kevin,

    I clipped my own last comment. Sorry if I didn’t recognize the source of your graph.

    Also sorry to plot the problem with today’s US style liberal government.

  13. Kan said

    Kevin,
    Where do the numbers come for the Thoma posted graph? And how is spending defined in the source data?

  14. CM said

    I think the real graph you need to be looking at is this:

    http://static8.businessinsider.com/image/4e1b069c49e2ae172a000000/us-federal-receipts-and-expenditures-2000-2011.png

    from here:

    http://articles.businessinsider.com/2011-07-11/news/30013193_1_budget-deficit-government-spending-tax-collections

    I don’t understand how you can get “Obama massively increased spending” out of that.

  15. CM said

    Kan, in the comments of the Thoma article, someone (the original emailer?) explains it’s overall — federal and state — spending. I don’t know the source but FRED could be useful: http://research.stlouisfed.org/fred2/.

  16. Jeff, no comment on your statement that Bush Jr had a democratic house and senate? Isn’t this a perfect example of conservative fantasy?

    The very simple facts say one thing – Republicans had control of the Presidency, the House, and the Senate for almost the entire first 6 years of Bush Jr’s administration. Yet you wrote, “Bush Jr, had a democrat house and senate…”

    Your analysis that Bush had to ‘mitigate damage’ is *worthless* – it’s a conservative fantasy. It was all under GOP control.

    You don’t find it ironic that in attempting to refute my point about conservative fantasies you actually employ one?

  17. Genghis said

    Trying to attach blame is a fools game. ALL of the Presidents and Congress’s spend more money than the government collects, that is their job, it is what they do. It is a ponzi scheme that we ALL play, primarily because our culture and society teaches us to play the game. The purpose of having children is for them to work and support their parents and bureaucrats and the bureaucrat’s supporters.

    The real solution is for each of us to be accountable for our own support and not depend on the Government to support us.

  18. omanuel said

    @ M Simon (March 17, 2012 at 11:33 am)

    This leftist, long-time Democrat was at a local Republican Caucus to support the nomination of Ron Paul when your comment was posted. I actually abhor politics, but we have been part of a great social engineering experiment that I failed to recognize when it was adopted in 1971 (although several warnings went unrecognized):

    Unite Nations against an imaginary common enemy – Global Climate Change – to save the world from mutual nuclear annihilation after world leaders faced their own mortality in events of Hiroshima (6 Aug 1945) and the Cuban Missile Crisis (late Oct 1962): : http://omanuel.wordpress.com/about/

    If our society survives until election time (that is questionable), I will vote for anyone except Obama.

    There were several students and a political science faculty member among Ron Paul supporters at the caucus.

    I too am heartened at the number of university students and young idealists that will support Ron Paul. His popularity on campus is an encouraging sign that constitutional government may survive.

  19. Jeff Condon said

    “Jeff, no comment on your statement that Bush Jr had a democratic house and senate? Isn’t this a perfect example of conservative fantasy?”

    Not a fantasy. Just mis-written. I didn’t want to hide the error. Would you agreee with:

    Bush Jr had a liberal spending house and senate?

  20. Genghis said

    A question Kevin. Do you think Government deficit spending and bailouts is a good idea?

    It seems to me that the purpose of AGW is to bankrupt the Western Nations and enrich the AGW supporters.

  21. Jeff Condon said

    CM,

    “I don’t understand how you can get “Obama massively increased spending” out of that.”

    Just because spending increases haven’t stopped happening doesn’t mean that they didn’t exist. They have increased under Obama – massively. Just because Bush JR spent too much, doesn’t change the fact that Obama jumped in and spent a lot more. You are WAY too smart to pretend you don’t know about the out-of-budget spending. What is worse, spending increases continue, as your plot shows, despite the massive drop in revenue. And worse than all of those Leftists and Republicrat points, the future of Obama’s liberal extremist policies will double the deficit.

    Just don’t pretend all is well, and we will get along fine.

  22. Greg F said

    Republicans had control of the Presidency, the House, and the Senate for almost the entire first 6 years of Bush Jr’s administration.

    Not. Bush Jr. was in office from the 107th to the 110th Congress. The Democrats controlled the Senate for the 107th and 110th Congress (4 of the 8 years). The 107th was split 50 -50 until May of 2001 when Sen.Jeffords (Republican) from Vermont changed to independant in proceeded to caucaus with the Democrats. Other notable Senate RINO’s would be Olympia Snowe, Arlen Specter, George Voinovich, and Lisa Mukowski, The ideology that controls each house in Congress is not black and white (or should I say Red and Blue). To argue party affiliation is equivalent to ideological affiliation is naive to the extreme. Any argument that Bush Jr. was a fiscal conservative is equally naïve.

  23. Jeff Condon said

    Greg,

    You are right about control.

    The problem with my memory is that I was continually pissed off about republicrat spending.

  24. Kenneth Fritsch said

    Kevin O’Neill, have you any ideas about where we are headed with projected deficits and unfunded liabilities. Do you see any interest in the Liberal community on outlining how we avoid a financial diasaster? Do you have any ideas.?

  25. Genghis said

    Kenneth, The Kevins and ‘liberals’ are very clear about where we are headed. They want a one world government that they control with a greatly reduced world population of wage slaves. They are remarkably upfront about their goals, we just have a hard time believing them.

  26. CM said

    Jeff, it’s fine: I’m not even American, just been watching this political and economic trainwreck develop for what — 10, 12, 20, 30? 60?! — years, and wondering when someone would get a handle on it. “When America sneezes, the rest of the world catches a cold” and all that.
    WRT “liberal spending”, well, they certainly spent liberally. I wouldn’t say they spent on what you’d call traditionally liberal policies (two unfunded wars, high-end tax cuts, homeland security, …). It’s probably also worth noting that much of the spending increase post-2007 is in already-legislated automatic stabilisers (UI, etc.) and poverty-reduction programmes as people slipped down the income scale and into Medicaid, etc.
    I don’t want to make this an argument about what kind of government you *should* have: I’m just trying to bring information to the analysis of the government you *do* have (which I obviously can’t change).

  27. Jeff Condon said

    CM,

    And we can’t change it either! I hope I’m wrong, but we gotta stop the corrupt spending.

  28. Greg F said

    Jeff,

    I think we all get trapped in the team red – team blue cheering myth when the real struggle is the political class continued concentration of power. The team red – team blue cheering myth is convenient for the political class since no matter what team you’re on the result is the same. More power flows to the top. It doesn’t matter if it is the Patriot act or Obama care, both teams get to claim they scored some points.

    The reason this works comes down to one thing, greed. And I don’t mean the greed of the political class, which clearly exists, but rather the collective greed of the citizens in general. Take for example means testing for Social Security. Any attempt to fix the inevitable disaster that Social Security is going to cause will be soundly defeated for one reason, greed. Obama care appeals to greed in the same way. Go to any small town and there is no end to the stories on getting grants from the state or Federal government without even a peep of protest. If the state cuts back aid to schools, as has happened where I live, people get on busses and head down to the state capitol to protest not getting other people’s money. It is truly sad that greed and envy masquerading as social justice will destroy what was once the freest and wealthiest nation humanity has ever known.

  29. Jeff Condon said

    Greg,

    We shouldn’t let the fact that the spending problem is not one sided interfere with the obvious reality that the liberals are accelerating spending at every turn. The graphs above are irrefutable evidence of the fact. Despite some loss of revenue, spending is launching upward. Our only chance to survive, is to do our best to block more of the same.

    Congressional term limits seem like the next logical step. First, lets get rid of the spender in chief.

  30. Genghis said

    Jeff, how do we even slow down the spending? Over 60% of the Budget (money coming in) is entitlements, pensions, SS, Medicare, blah, blah, blah. A third of the budget is short term low interest payments on the debt. We don’t have the money to fund the military or any of the normal government programs at all. And if interest rates happen to rise at all it is all over except the shouting.

    There is nothing, nothing at all, that any elected official can do to stop the hemorrhaging. They can however borrow money from the Fed to keep the ponzi scheme going a little longer.

    Luckily it looks like there is time to prepare, and then we will just start over, like they did in Russia, Argentina, Iceland, etc. Hopefully the people that will suffer the most are the Politicians and Bureaucrats, but history tends not to favor that wish : (

  31. Jeff, no, you’re wrong yet again. It wasn’t ‘liberal spending’; it was *conservative spending*. You’re so wrapped up in labels you simply cannot see the truth.

    Your comment wasn’t a simple typo or mis-written. You went on from the comment to justify W by saying he had to mitigate the damage. The whole line of reasoning falls apart once we recognize these were Republicans. The difference is the GOP *also* cut taxes – meaning that unlike the Democratic years under Clinton the deficits ballooned. Each party spends – one party is consistently unwilling to pay for that spending – Republicans. To support this position conservatives have built a mystical realm where cutting taxes increases revenue and the answer to each and every problem is to cut taxes. The end result has always been higher deficits.

    @ Genghis – “The Kevins and ‘liberals’ are very clear about where we are headed. They want a one world government…” You’re making sh*t up. If you’re unwilling to engage in a discussion that involves what I’ve *actually* said or written, then please don’t even bother mentioning my name. I spent 4 years in the US Army. I headed overseas on my daughter’s 1st birthday. I’m not one that believes military service necessarily entitles one to special perks, but unless I actually say or write otherwise, I think I’m at least owed that much. Go crawl back under whatever rock it is you call home.

    @Kenneth: It is always wise to be fiscally prudent. If we do *nothing* the budget balances itself in about 10 years. *Nothing* There’s also another simple fact to remember: We’re not Greece (or Portugal, or Italy, or Spain). Those who predict us to follow the path of Greece ought to have a bright red ‘S’ tattooed on their foreheads. ‘S’ for Stupid. We have our own currency. At *any* time we can pay off our debts by simply printing money. Now, they may lead down a road we don’t want to travel on – but it’s a different fate than that of Greece.

  32. Greg F said

    Jeff,

    The spending is obviously the problem. And yes, the left shares a greater responsibility for out of control spending. Just look at the states where the fiscal solvency is in the greatest danger.

    I don’t think that term limits would significantly change the dynamics. I think it would result in the new boss being just like the old boss. The voters would still vote for the candidate who promises that grandma won’t have to eat cat food. Isn’t that what usually happens now when a politician retires or moves on to a different office? Greed will still drive the vote. What is to prevent the term limited retired politician from running for a different office? Nothing I suspect. What is to prevent them from getting appointed to some high paid do nothing job for loyalty to the cause? And the jobs don’t have to be government jobs. They could be some non-profit that runs off of government grants. We could see a whole lot more of Gleick type non-profits to funnel tax payer money into. I very much doubt many of them would return home to continue what they were doing before they were elected.

  33. Jeff Condon said

    Kevin,

    Are you truly not aware of the liberal policies loading our government from every angle? Does a graph of presidents spending fool your brain so thoroughly that you cannot recognize the group responsible for the most extreme spending in history of man? He did slam more government down our throats than any presiedent in history – despite your sophistry. Hell, my first figure shows a huge jump under obama right during an economic collapse, and yet you have no concept that this MIGHT be a bad thing? Endless data showing the pending collapse of medicare, medicade and social security and we are supposed to ignore the new ‘obamacare’ nightmare yet to hit?

    Frankly bud, I’m not that stupid.

    Now you are off on tax cuts. Another issue I suspect you have little understanding of. ‘Tis literally moronic to even suggest that taxation is either responsible for or has any ability to correct the insane spending.

  34. Jeff, “… liberals are accelerating spending at every turn.The graphs above are irrefutable evidence of the fact.”

    No, not one of your graphs supports that conclusion. Almost all of them deal with the deficit – and as I’ve already pointed out, the deficit is a combination of spending, interest payments, and revenues. CM in #14 provided links to a Business Insider article titled, The Truth About Who’s Responsible For Our Massive Budget Deficit. This clearly shows that reduced revenues are largely responsible for the current increase in deficits – not increased spending. All of this on the heels, of course, of an economy destroyed by Republican policies which Obama inherited.

    If one accounts for safety net programs (where we’d expect an increase in spending due to automatic stabilizers – kicked in by the Bush-ruined economy) the *increase* in spending is practically non-existent.

  35. Greg F said

    We have our own currency. At *any* time we can pay off our debts by simply printing money.

    That isn’t paying off debt. It’s theft. Money is not wealth. Money has no intrinsic value. It is a tool we use to exchange wealth. Money only has value in that it represents real wealth (goods and services). Printing money simply lowers the value of the money. Can you say inflation? For the sake of argument assume the government prints up enough money to double what is already in circulation. The real wealth hasn’t changed at all. The real wealth a dollar use to represent now costs $2. It’s theft because the government has in effect transferred half the wealth to itself.

  36. Greg F said

    No, not one of your graphs supports that conclusion.

    Try this one.

    http://www.usgovernmentspending.com/spending_chart_2000_2010USp_13s1li011mcn_F0t_US_Government_Spending_As_Percent_Of_GDP

  37. Jeff Condon said

    Kevin,

    You are one of the most deluded individuals I’ve ever met. Of course it is the internet.

    Endless increases in government agencies across the board and all you see is the evil Bush.

    Whatever.

    My point, as it has always been, is that we need to stop the insane spending. Cuts in programs are very easy to come by. What the left continually fails to realize is just how much pressure the economy is under. Raising our already massive tax does nothing.

    We have left ourselves only one way out of the mess. We can chose strong pro-business policy or collapse. I sure don’t see much space in the middle for a normal recovery. Of course it will be Bush’s fault that the EPA won’t let us drill oil wells.

  38. Kenneth Fritsch said

    “@Kenneth: It is always wise to be fiscally prudent. If we do *nothing* the budget balances itself in about 10 years. *Nothing* There’s also another simple fact to remember: We’re not Greece (or Portugal, or Italy, or Spain). Those who predict us to follow the path of Greece ought to have a bright red ‘S’ tattooed on their foreheads. ‘S’ for Stupid. We have our own currency. At *any* time we can pay off our debts by simply printing money. Now, they may lead down a road we don’t want to travel on – but it’s a different fate than that of Greece.”

    I would have to surmise here Kevin that you are suggesting that if we do not increase spending further into the future and allow the Bush tax cuts to expire we will balance the budget in 10 years. You are also suggesting via the Greece trap that if you can print money you can inflate your way out of debt. These are basically Liberal hand waves at the problems of big government that are best generalized for selling them to the public or better to popstpone any actions and wait for an “emergency” where it might be easier to impose new government controls and taxes. Perhaps you can provide a few details of what tax rates are required and whether you assume that increasing taxes will not have negative effects on the economy. What about the unfunded liablities of Medicare and Social Security? What kinds of inflation rates and price increases would be required to inflate our way out of debt? What effects would that have on those people living on fixed incomes? What would the deficit be in 10 years when we commence balancing the budget under your scenario? Are you sure that you including the SS and Medicare expenses over revenues in this scenario? Are you also saying that the Liberal agenda will call for no increases in Federal spending for 10 years? At what rate does the economy have to grow to meet your 10 year balanced budget. Have you factor in the new data that estimates the cost of Obamacare will double in the next ten years over what was originally estimated? When you answer those question on the details of your pronouncements, I will have a few more.

  39. Jeff condon said

    Kevin,

    Here is a wikigraph which should satisfy your intellectual curiosity.

    http://en.wikipedia.org/wiki/File:Revenue_and_Expense_to_GDP_Chart_1993_-_2008.png

    Note the lack of ‘revenue’ or a percentage of ‘personal profit’ during the obama years and note again the increase in expense as %GDP. The problem again, as I have so often written on this thread, is that the future regulations which have been set in motion are far worse.

    Are we literally going to take 25% of GDP for the government? Good luck with that!

  40. Jeff, I’m not the one deluded.

    You missed the source for the graph and asserted that I didn’t include it. Wrong.
    You asserted that Bush Jr had a democratic house and senate. Wrong.
    You asserted it was *liberal spending* Wrong.

    Now, given you can’t get simple facts straight, cannot tell the difference between deficits and spending and do not actually seem to know anything other than *rhetoric* – why would anyone believe you on anything substantive?

    What exactly would *pro-business* policy be – castrating unions? Zero taxes? How does this correlate with *actual* past economic performance? How did business thrive much less survive the 1950s? You have an ideology and no facts to back up anything you say. Show me a country with government slashed to the levels you’d prefer and I’ll show you a third-world country. Explain to me how Germany has one of the strongest economies in the world – yet among the strongest unions.

  41. Carrick said

    Kevin:

    It is ironic, given that I said conservatives live in a fantasy world, that this is a just another example. Jeff makes an assertion that is incorrect and contradicts the facts.

    No the real joke is the fantasy world you liberals live in where you think that you are in any measure fiscally responsible. Don’t lump me in with the conservatives or libertarians, I’m neither of these by the way.

    I just think your argument is full or more holes than the tittanic.

  42. Carrick said

    Kevin:

    This clearly shows that reduced revenues are largely responsible for the current increase in deficits – not increased spending. All of this on the heels, of course, of an economy destroyed by Republican policies which Obama inherited.

    If one accounts for safety net programs (where we’d expect an increase in spending due to automatic stabilizers – kicked in by the Bush-ruined economy) the *increase* in spending is practically non-existent.

    Could you get more ideological or partisan in your view without turning into a pretzel.

    Jeebus man. You’re sounding like that foam at the mouth idiot Keith Olbermann.

  43. Jeff condon said

    You missed the source for the graph and asserted that I didn’t include it. Wrong. [REPLY: who cares, you were wrong about Obama's spending increases. Isn't that more pertinent? ]
    You asserted that Bush Jr had a democratic house and senate. Wrong. [REPLY: admitted, but he did suffer a close Senate balance which resulted in more spending programs than not. I'm not a republican cheerleader, I am a conservative who wants less government in my life. Bush had a house and senate with loose purse strings that drove me nuts.]
    You asserted it was *liberal spending* Wrong. [REPLY: you only have to look at the various programs to see the spending. They are clearly liberal in nature, clearly unnecessary or can be deeply cut back (DOE for instance) or perhaps the bloated EPA and often completely dysfunctional (e.g. ATF). You are out of your mind if you think otherwise.

    I’m not going to defend Republicans in general but I would like you to name which programs the Republicans implemented that that you would cut that could reverse or even substantially affect the graphs above.

    My guess is military or none. Lets have it though.

  44. Jeff condon said

    “Show me a country with government slashed to the levels you’d prefer and I’ll show you a third-world country.”

    While I would disagree with some of the social policies, this is what happens when you have a flatter pro-business tax system:

    http://www.google.com/imgres?imgurl=http://www.discoverhongkong.com/eng/images/landing.jpg&imgrefurl=http://www.discoverhongkong.com/&h=400&w=827&sz=137&tbnid=1TQggJrb2_q1lM:&tbnh=63&tbnw=131&prev=/search%3Fq%3Dhongkong%2Bimages%26tbm%3Disch%26tbo%3Du&zoom=1&q=hongkong+images&docid=LQfX0fkEhGiGuM&hl=en&sa=X&ei=AShlT6_kAdHnggeRmL24Cg&ved=0CCgQ9QEwAA&dur=325

  45. Jeff condon said

    A primer for your genius mind Kevin:

    http://gohongkong.about.com/od/businessbasics/a/HongKongTax.htm

  46. @Kenneth -”Have you factor in the new data that estimates the cost of Obamacare will double in the next ten years over what was originally estimated?”

    I don’t have to factor it in – it’s another conservative myth. You need to factor it *out*. As Sahil Kapur explains:

    CBO’s actual revised estimate is that the “gross costs of the coverage provisions” — the money used to provide people Medicaid or private insurance — has risen by about $50 billion over the 2012-2021 period since its previous estimate, from $1.445 trillion to $1.496 trillion. That’s the only relevant change to spending projections in the report.

    So where are conservatives getting the idea that the cost of the law doubled? When it passed in 2010, CBO said its 10-year outlays would be about $940 billion. But because the law isn’t set to be fully implemented until 2014, when the coverage expansion takes effect, that initial estimate included several years in which the law cost very little. Now that it’s 2012, CBO’s 10-year outlook captures more years during which the law will be in full effect. The law’s price tag appears higher, but its costs in no way doubled.

    I said that conservatives live in a fantasy world. There’s little connect to reality. But they only listen to each other so the echo chamber effect is strong. Tomorrow Jeff will be repeating that Bush Jr had a democratic house and senate. Tomorrow you’ll be repeating that “new data that estimates the cost of Obamacare will double in the next ten years.” It doesn’t matter that you’re both wrong – you’ll just continue repeating the same nonsense (and much more nonsense in the same vein).

  47. Jeff condon said

    “Tomorrow Jeff will be repeating that Bush Jr had a democratic house and senate.” — I would appreciate a tiny bit of honesty big guy.

    I would also appreciate if you noticed the links which show spending as a % of GDP.

  48. @Kenneth – The CBO has said before that the ACA will *reduce* the deficit. The new report actually says that the newest projections are that it will *reduce* the deficit more than they originally thought. So costs go up $50 billion over ten years, but revenues exceed that amount more than originally expected. This is a prime example of conservative fantasy-land. A program that is projected to *reduce* the deficit is excoriated by people who claim to want to reduce the deficit. Duh!

  49. Jeff condon said

    We shouldn’t forget both bailouts – Bush and Obama – were Democrat supported policies with moderate RHINO backing. Slap another trillion of red ink on the blue side of the scale – on top of recent years deficits.

    The first bailout was necessary, the second was a payoff to unions and those who elected Obama. The first bailout though was forced primarily by liberal housing policy. Again facts which Kevin’s sort will likely ignore.

  50. M Simon said

    OK. You want to do Republican policy disasters that don’t show up ’til years later? Here is a bit written by a former Bush 1 HUD Secretary, C. A. Fitts.

    After reading Dark Alliance, I started to study the extraordinary moneymaking business that DOJ and agencies like HUD had built in enforcement that really only made sense if in fact the government was entirely complicit in narcotics trafficking and related mortgage and mortgage securities fraud.

    Links available at: http://classicalvalues.com/2012/03/wall-street-is-in-the-news/

    Short version: Drug Prohibition – which Republicans like – is being used to undermine the real economy.

  51. M Simon said

    BTW the C. A. Fitts quote is from 2006.

  52. Jeff,

    Tomorrow Jeff will be repeating that Bush Jr had a democratic house and senate.” — I would appreciate a tiny bit of honesty big guy.

    What – you didn’t say that? You said it and you meant it. [REPLY:Go back and read my replies- all of them. Falsely ignoring me and attacking is getting tiring.] Otherwise why would you have said Bush Jr had to “mitigate the damage”? Hell, I didn’t even get into the fact that Bush proposed most of the damage – much less mitigate his own party’s malfeasance. Or perhaps it was liberals that mislead us into war with Iraq. Perhaps it was liberals that favored and passed huge tax cuts that busted the budget.

    NEWSFLASH for Jeff – No, I just double-checked – it was Bush Jr.

    I would also appreciate if you noticed the links which show spending as a % of GDP.

    You are being disingenuous aren’t you? GDP in an economy that just tanked thanks to GOP policies …. ummmm I did say that safety-net spending and automatic stabilizers *increase* spending in a bad economy. A bad economy *means* GDP is not increasing at the optimal rate. The percentage *has* to rise. It wouldn’t matter who was president. Obviously you should be smart enough to know that – or perhaps I give you too much credit. Are you completely ignorant of counter-cyclical policies? Why don’t you just do the work and deal with actual *spending* – you know, the point I actually brought up?

    I suspect you *have* run the spending numbers and came up with the same graph that Mark Thoma displayed. [REPLY: Nope, his graph is stupid and doesn't recognize the problem. I used a different wealth depreciation estimate and came to a different answer - before I wrote this post. Who cares.] I ran them and verified he was correct, so you must just want to avoid the issue. Any red-herring will do.

  53. Genghis said

    Jeff – “We can chose strong pro-business policy or collapse.”

    I don’t know. The idea that we can feed the government parasite enough to satisfy it won’t work, the parasite will just demand more. The only thing that would work is for the Government to drastically reduce spending, but that would put us in a recession that would make the great depression look like boom times and probably collapse the Government anyway.

    The Fed is currently pursuing the only rational strategy it can of supplying capital to the Government, Banks and Market. Luckily, between the collapse of the Real Estate and Stock Market booms which are highly deflationary, the Fed has been able to fund the Government and to pump and dump the market, while at the same time keeping inflation in check. Frankly I have been amazed that Obama and the Federal Reserve have been able to walk this tightrope without a single slip and for so long. I also expect them to be able to continue walking the tightrope for quite some time.

    The problem with this strategy is that it is simply a transfer of wealth, from the savers and producers in our society to the government and its dependents, and it is accelerating. The acceleration (compound interest) is what is going to do us in and there is nothing we can do about it. Math doesn’t lie.

    All we can do is keep playing the game, and realize that the normal rules have reversed. Saving money is stupid, now is the time to buy depreciated assets with inflated money, take a clue from the Federal Reserve. The trick though is to procure non taxable assets, buying Real Estate won’t work if no one can afford the taxes.

    Personally, I picked up a cheap sail boat and I am going to go cruising, almost completely self contained for a few years, while I watch what my investments do. I invested in food and energy. I’ll tell you in a few years if I was right : )

  54. Jeff, “The first bailout was necessary, the second was a payoff to unions and those who elected Obama.”

    You’re being ideological and *not* thinking critically. Where would the US auto industry be if the government hadn’t bailed them out? Where would hundreds of thousands of American workers be? You claim to want *pro-business* policies – yet when Obama works to save an entire industry (and all the supporting engineering, manufacturing, etc) you complain. If GM and Chrysler had been allowed to go under, they would probably have taken much of the supply chain with them — and then Ford would have been in jeopardy as well.

    Your second point is *ANOTHER* conservative myth. I assume you mean something like Mitt Romney’s infamous, “The president gave the (auto) companies to the UAW.”

    Politifact rated this as false and there’s not-much to disagree with in their analysis. Is *everything* you think you know this colored by ideology?

    The final sentence from Politifact. “All the experts we talked to agreed that Romney’s statement is just flat wrong. Our ruling: False.”

    Just flat wrong. Sound familiar?

  55. Greg F said

    The CBO has said before that the ACA will *reduce* the deficit.

    This is a prime example of O’Neill’s fantasy-land. He actually believes the CBO projections actually bare any resembelance to reality. A little trip back in time.

    A Preliminary Analysis of the President’s Budget and an Update of CBO’s Budget and Economic Outlook
    March 20, 2009
    http://www.cbo.gov/publication/41166

  56. Greg F – Isn’t that a bit disingenuous given that no one understood how badly Bush and GOP policies had screwed us? That report came out less than month after the inauguration.

    Over the years CBO projections have been far closer to reality than any GOP administration’s. Remember what everyone in the GOP predicted if Clinton’s 1993 budget was passed? Yeah – how’d that turn out. Remember the furor over the Obama stimulus plan? Up and down the tired old GOP line we heard inflation, (usually HYPER inflation) increased interest rates (usually SKYROCKETING) , and *more* unemployment. Reality has been slightly different.

    The problem was far larger than most people realized, therefor the stimulus plan was too small. It still hasn’t created enough demand to get businesses back to capacity. At least we’re not the UK where conservative politicians embarked on a course of ‘austerity measures’ – the type most here seem to endorse. The UK is now heading back into recession. But of course I’m being impolite by pointing out that the world deviates quite a bit from a certain fantasy realm inhabited by conservatives and libertarians.

  57. Peter said

    Jeff, and Kevin.

    You are arguing as though you are rearranging deck chairs on the Titanic. Your government has made promises in both social security and medicare that it can not keep. It cannot tax enough to fund them, for that level of taxation will crush the economy, and it cannot print enough without crushing the dollar. The USA is over.

    We Canadians swallowed our medicine 20 years ago, with radically reduced public pensions, and still it may not be enough. Your country will have to break your promises to your citizens, and Greece is the result.

    You have essentially reached 100% government debt to GDP, and that is without most of your liabilities booked, that is unrecoverable.

  58. Sorry – less than two months after the inauguration.

  59. Greg F said

    You are being disingenuous aren’t you? GDP in an economy that just tanked thanks to GOP policies …. ummmm I did say that safety-net spending and automatic stabilizers *increase* spending in a bad economy.

    So many myths … so little time. The GDP remains tanked and Mr. O’Neill can’t seem to put two and two together.

    You’re being ideological and *not* thinking critically.

    Mr. O’Neill certainly projects alot.

  60. Carrick said

    Kevin:

    Isn’t that a bit disingenuous given that no one understood how badly Bush and GOP policies had screwed us

    No because this is just bullshit on your Oblermannian hyper-partisanian part.

    The policies that screwed us trace back to the 1977 CRA act and its eventual corruption of F&M and the subprime mortgage loan industry, and to a world wide obsession with derivative products. Neither of these are traceable to GWB.

    This is always a good laugh (2004 F&M hearings).

    Maxine Walker: “We do not have a crisis.”

    Heh.

    Blame bush.

  61. Greg F said

    Greg F – Isn’t that a bit disingenuous given that no one understood how badly Bush and GOP policies had screwed us? That report came out less than month after the inauguration.

    Clearly blaming Bush is all you have. Not a chance the failure of the American Recovery and Reinvestment Act of 2009 (February 17, 2009) to do what was claimed could be anybody but Bush’s fault.

    The ‘it was far worse than we thought it was’ excuse is a clear sign of incompetence. Competent analysis includes making sure your inputs and their uncertainties are reasonable. That was clearly not the case. The “no one understood how badly” is just an attempt to deflect blame from a pathetically bad idea. The keynesian type stimulus has never worked and never will. It is based on the fallacy that money is wealth. It is only fools and academics that believe something that has failed everytime it has been tried.

    Over the years CBO projections have been far closer to reality than any GOP any administration’s.

    There … fixed it for you. Of course all your doing here is misdirection. Fundamentally dishonest. This is what you said.

    The CBO has said before that the ACA will *reduce* the deficit.

    Rather than concede the point that CBO projections are dubious at best, which would be the honest thing to do, you attempt to cover your ignorance with a pathetic misdirection.

    And one more thing the “up and down the tired old GOP line we heard inflation”. If you haven’t noticed we got inflation. How you couldn’t have noticed is anybodys guess. Maybe mom never sends you to the supermarket.

    A lot of the inflation is bottled up right now due to uncertainty. When people sit on cash it helps to keep prices in check. Corporations are sitting on a couple of trillion dollars in cash right now. I have no idea how much people are sitting on but I suspect it is significant. When and if people become confident the economy is heading in the right direction that cash will start flowing into the economy. That is when the inflation will take off for real.

  62. Peter said

    I see both sides are in actual denial…………..

  63. M Simon said

    Actual denial? They don’t even want to find out. Former Dillon, Read partner and HUD Secretary CA Fitts wrote a book documenting how hot drug money was used to take down the mortgage industry and the fools are still arguing left/right. Not even a “that is BS” without looking of course. I have a link up thread to more links including the book link. Don’t you want to at least read excerpts if for no other reason than to shoot it down? It is WAY beyond the health of the economy or mortgage fraud. Some “group” is using the proclivities of the left and right to take them both down. And people prefer to avert their eyes. Naked Lunch can be very unsettling.

  64. kuhnkat said

    Kevy Baaaaaybeeeee,

    Are you going to deny that certain Democrats in Congress started screaming thinks like “mean racist Republicans don’t want to let poor blacks have houses” everytime Bush and others in Congress tried to stop the Fannie/Freddy train wreck??

    Are you going to deny that the Democratic Senate has BLOCKED reduced budgets for the last, how many years has it been Kevy??

    You want to assign PERSONAL BLAME Kevy?? Try looking back at Obie’s only real gig as an attorney. He was the mouthpiece for a team of attornies that was litigating suits against banks and mortgage companies forcing them to make loans to people who couldn’t meet reasonable requirements in Red Lined areas where no one wanted the property!! He helped cause the REAL problem. It is only appropriate he takes the blame for it!!

    We could go on, but, as Jeff points out, the Republicans haven’t been doing a very good job of reducing the size, wastefulness, and unConstitutional interference of gubmint. The Democrats have Trumped them by quite a bit, especially on the Crony Capitalism and Crony Political bud side of the ledger though.

  65. kuhnkat said

    Kevy Baaaaaaybeeee,

    I notice you are into fantasy’s. Tell us again that bedtime story of how a corrupt, inefficient gubmint is going to expand health coverage to another 40,000,000 people while slashing the spending on health care and reducing the deficit??

    HAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHA

  66. TGSG said

    I haven’t seen much mention of unfunded mandates either. As someone above said, math doesn’t lie. It’s all over but the shouting now. You have to wonder Kevin, why G the Younger had such low approval ratings. The libs didn’t like his wars abroad and the cons didn’t like his spending.

    The tea party got its impetus during his presidency. Now it doesn’t matter. As Ghengis above stated, the best thing to do now is buy bread and butter and hope some miracle happens.

    Kevin, you stated above that “we can just print money”.
    Print money = inflation.
    inflation hurts the poor the most.
    Why do you hate poor people?

  67. boballab said

    Look guys arguing with Kevin will do no good for he has already shown he is economically illiterate. Anyone that uses the argument that you can print your way out of massive debt is clueless. He needs to read up on Hyperinflation and the numerous case studies:
    http://en.wikipedia.org/wiki/Hyperinflation

    Oh and Kevin that is the ultimate fate of Greece. You see when Germany finally gets tired of this game of musical chairs that has been played, Greece will be forced out of the Euro. When that happens they will be forced back on the Drachma and will have to pay their debts with them. When that happens watch the hyperinflation kick in.

  68. Carrick said

    M. Simon, if you insist (it seems you do) on balance (the following are my opinions albeit somewhat informed)

    1) yes we would be better off with less restrictive laws on drug usage,
    2) less emphasis on controlling adult pornography,
    3) less concern about paying more for contraceptives instead of more for abortions or chid welfare (which costs more, dumb ass alert),
    4) less concern about “the fetus is a human” and more concern about the life quality of the child after birth,
    and finally for the libs,
    5) less concern about microscopic effects on the ecology and “social justice” the Robin Hood way (take from the rich and give to the poor till everybody is poor as dirt because that is what happens eventually in that scenario) and more concern about funding foreign totalitarian regimes with hideous human rights records through oil who at best are neutral towards us and in many cases outwardly hostile.
    6) less concern about assigning the blame for why things are effed up and more concern about what to do to fix it.

    IMO…. the Republicans are f**ked. They now embody the “Party of Stupid”— They are running a campaign that is aggressively anti-womens rights and are openly touting an ethics that resonates with only a small but vocal minority within their party. Expect two-term Obama, major hemorrhaging in house and senate. This in a cycle that should have seen a one-term president and major gains in house and senate.

  69. Guys. Guys… Just as some don’t want to ask what the ideal temperature of a planet might be, you are treating debt as a problem here when for most of its existence debt is actually a solution.

    What is the highest level of debt this country has supported?
    What happened to the country when it operated under this debt?

    Why on Earth would we talk about debt without normalizing comparisons to talk apples vs. apples? Percentage of GDP is the only thing that matters, because GDP is the source of the credit that allows the debt and the resources required to repay it.

    Borrowing money at effectively zero interest rates in order to prop up an economy badly mired in the depths of a recession does not on the face of it appear stupid. Not for Bush and not for Obama.

  70. Kenneth Fritsch said

    To get a flavor of the Liberal fantasy world I recommend a careful reading of the excerpt below from Kevin’s post.

    The Liberals sold the Obamcare program based on sham accounting that they knew had to be used in the CBO estimates. Estimates that by the way are almost always wrong and underestimate costs because they have to take the people writing and approving the laws at their word. Future Medicare costs are always based on legislation that states the rates for doctors will be decreased by some significant amount but never are. If they were we would have fewer doctors participating in giving care to Medicare patients. The CBO estimates are a fantasy and are readily utilized by those employing fantasies.

    That CBO accounting kept the cost under a trillion dollar cost over 10 years that was promised by Obama by basing that cost on a program that requires revenues upfront before the expenses accumulate. That deceptive accounting (on the administration’s part not the CBO’s as the CBO merely follows the rules already established for their estimates and by the way makes them nearly worthless in the process) leads to basing the implied ongoing costs of Obamcare on something less than it actually will be over the long term. What has occurred is that that deceptive accounting now becomes apparent.

    “CBO’s actual revised estimate is that the “gross costs of the coverage provisions” — the money used to provide people Medicaid or private insurance — has risen by about $50 billion over the 2012-2021 period since its previous estimate, from $1.445 trillion to $1.496 trillion. That’s the only relevant change to spending projections in the report.

    So where are conservatives getting the idea that the cost of the law doubled? When it passed in 2010, CBO said its 10-year outlays would be about $940 billion. But because the law isn’t set to be fully implemented until 2014, when the coverage expansion takes effect, that initial estimate included several years in which the law cost very little. Now that it’s 2012, CBO’s 10-year outlook captures more years during which the law will be in full effect. The law’s price tag appears higher, but its costs in no way doubled.”

    It becomes rather obvious that the costs of domestic and military programs are always greatly underestimated (by fantasy, if you will) in order to sell them to the public. When Kevin talks about balancing the budget in 10 years he merely arm waves a magic wand – a pure fantasy without the details. Also notice that Kevin once again provides a distraction from the details I asked for in a previous post.

  71. Kenneth Fritsch said

    “Guys. Guys… Just as some don’t want to ask what the ideal temperature of a planet might be, you are treating debt as a problem here when for most of its existence debt is actually a solution.”

    The point of our current financial problems are what awaits us is in the future based on government outlays that have been promised to this point and are not funded. That situation is not sustainable and it does not go away by merely quoting blithe statements about debt.

    I think much is misunderstood about the gravity of those unfunded liabilities and the fantasy world idea that we can merely cut the promised expenditures back a bit and increase the revenues in order to fix these problems. People have come to depend on programs like Social Security and the promise of those payments has discouraged a significant portion of the population to provide supplemental sources of savings for retirement. The promises of Social Security has removed for many the obligation to provide in emergencies for the care of parents. Many people significantly need to lower their standards of living when the only source of income is Social Security – and unexpectedly. Raising revenues to provide for these programs at the promised levels means that the economy will take a significant hit unless you live in a fantasy world where government revenues are not differentiated from private costs.

    We sometimes never get beyond the federal level when calculating unfunded liabilities of government when in fact those of states and local governments can be as bad or worse with regard to funding government sponsored pension plans. Actually there is no binding legislation at the federal to provide for these pensions, but at the state level, like Illinois, we have a constitutional obligation to eventually fund all the promised obligations.

    I can see US citizens reacting like those in Greece when the piper must eventually be paid whether it be by austerity or inflation or some combination of those approaches.

  72. Jeff Condon said

    Thomas the second!

    “Borrowing money at effectively zero interest rates in order to prop up an economy badly mired in the depths of a recession does not on the face of it appear stupid. ”

    If you don’t mind writing that near zero interest check for us, I will change my mind :D

  73. Carrick said

    #69 thomas:

    Why on Earth would we talk about debt without normalizing comparisons to talk apples vs. apples? Percentage of GDP is the only thing that matters, because GDP is the source of the credit that allows the debt and the resources required to repay it.

    Yes I agree with this. It’s a much better measure than normalizing by per capita.

    Jeff does show a figure normalized to GDP. Predictably because it doesn’t tell the story Kevin wants told, there’s something wrong with it too.

    Apparently if it doesn’t invoke that warm and fuzzy in your belly it’s not true for a “liberal.”

  74. Kenneth Fritsch said

    “Borrowing money at effectively zero interest rates in order to prop up an economy badly mired in the depths of a recession does not on the face of it appear stupid. Not for Bush and not for Obama.”

    It is very stupid if you recognize that the finacial problems occurred because of artificially easy credit provided by the Federal Reserve and creating mal investments of which housing was a prime example. What is currently required is for an adjustment to the real investment rate and not the one artificially created by the Federal Reserve. All the magic of zero interest rates creates is more mal investments that make the required eventual adjustments even more painful.

  75. M Simon said

    Carrick,

    Uh. You don’t get it. It was a criminal operation. Not a mistake. Not an excess of greed. Not misguided liberals. Straight up criminal. Why? Well the money needed laundering and the Government seemed to be in the best position to get the job done.

    Really. Read the book. Or just chapter 3 to start.

    http://dunwalke.com/3_RJR_Nabisco.htm

    How tobacco companies launder drug money.

    Then try chapter 16.

    ========

    With prohibitions you get corruption. Just how much can you stand?

  76. M Simon said

    I can see US citizens reacting like those in Greece when the piper must eventually be paid whether it be by austerity or inflation or some combination of those approaches.

    Move to Texas.

  77. Jeff Condon said

    Obama isn’t the devil but everything he and the leftist governments of this country are doing appear to me to be economically destructive. Recent regulations on environment and energy in particular are nothing but harmful. Obama can only control so much but if you are heading toward the wall, hit the brakes NOT the gas.

    Carrick,

    I also wish the idiot candidates would stay away from social issues and I wish the Democrats would understand that a flatter payment and keeping of wealth are what drove our success. You can’t keep steepening the tax rates just for votes (tax the rich). Yes, I know it has been worse for the top earners in the past, but the level of destructiveness to our economy of these policies is incredible. Peoples hands go out further as the liberal policies take effect and gradually enslave the population to entitlements. Government entitlement is an immorality in my opinion. Help the helpless, not the clueless and definitely NOT everyone! History should have taught us that by now.

    I’m paying stupidly large taxes this year, as I have mentioned several times, right now I’m revising my previous estimate to as much as 6.5 times my salary – in taxes. That doesn’t include state tax, payroll contributions, five figure business property tax, sales tax, gas tax, or the requisite alcohol tax and counseling sessions to make yourself feel better. I suppose that is what you get for 70-90 hour weeks “growing” a manufacturing company these days. In the meantime, they hand out healthcare in Illinois for free to everyone who doesn’t feel like working, and that bill shows up on our huge corporate health insurance premiums. A hidden tax!

    Fortunately, we can write that hidden insurance tax off.

    I didn’t like Bush because he couldn’t resist the spending either. Just because he spent too much doesn’t mean we should continue the program. I’m voting for whomever will try and slow down the bleeding most. It looks to me like we likely get to chose between two flavors of poop again.

  78. TerryMN said

    Kevin could take a lesson from Tom Fuller – how to present an argument without being an inveterate asshole – but I doubt he ever will.

  79. Hiya Jeff! Want some help?

    Carrick, that figure on Wikipedia that Jeff cited and you linked to tells more than one story, you know… Look at tax revenue in recent years and how low it is.

    But to address my point you would have to go back to WWII when we carried a lot of debt without mortgaging our future. Debt is a very useful tool and a terrible master. But we are not now and in all probability never will be in a position where our debt alone controls our destiny.

    And Jeff–that chart I just mentioned shows tax revenue under the Obama administration at an average of 15.2% of GDP. that’s really, really low–like pre World War One levels…

    We’re moving into a real recovery phase and, absent the next disaster, people will move off the unemployment rolls, reducing government expenditures and into jobs that require them, like Jeff, to pay taxes, increasing government revenues. This is one of the automatic stabilizers that helps create a virtuous circle, and we should all welcome this.

    I personally hope this happens quickly enough to help the political chances of Barack Obama, who I not only support but would tout as the most effective president in the past 60 years. (Sadly, the quality of the Republican field means he probably won’t need much help–Obama does need to be pushed, and you guys on the other side of the fence are not doing the country any favors by throwing candidates at him that just don’t cut the mustard.)

    But Social Security needs some minor tweaks. Medicare needs major reform. I think we’ll get both. I think we’ll be okay.

    One clue to help you look ahead–China just moved from trade surplus to trade deficit last month. How many Boeings do you think they’ll buy to punish Europe (and Airbus) for its cockamammie CO2 penalties for air travel?)

    It’s going to be okay, folks. Really. This is the real American century.

  80. omanuel said

    Who is wearing UN’s mask now?

    At the local Republican caucus yesterday, I observed both

    a.) Remnants of representative government still working well, and
    b.) An all-pervasive concern that something is seriously wrong !

    Ordinary citizens are uneasy; “Bill of Rights” protections, adopted to the US Constitution in 1791, are vanishing.

    http://www.law.cornell.edu/constitution/billofrights

    Are political leaders at fault? Are they just asleep?

    There is little doubt: Total control of people and information is someone’s goal. Who directs this campaign now?

    c.) The British Royal Family again?
    d.) Another Sleeping Giant awoke?

    It started in about 1971, when Henry Kissinger secretly flew to China to negotiate an end to the Cold War.

    http://omanuel.wordpress.com/about/

    By 2004 the basic physical sciences had been seriously compromised – astronomy, astrophysics, climatology, cosmology, nuclear, particle, planetary, space and solar physics:

    http://judithcurry.com/2012/03/17/week-in-review-31612/#comment-186200

    Some think c.) the correct answer.

    I suspect the correct answer is d.)

    With kind regards,
    Oliver K. Manuel
    Former NASA Principal
    Investigator for Apollo
    http://www.omatumr.com/

  81. Kenneth Fritsch said

    A touch of reality is in order here folks and we can look at the CBO 10 year estimates of deficits and debt at the link below. Please note the assumptions that are made by the CBO. After 10 years the deficit (for year 2022) is at 303 billion dollars (See Table 1) and not zero as Kevin has fanaticized. Note the disclaimers on getting all the tax revenues back from the Bush tax cuts and not just those from the wealthy. Note that it depends on significant cuts in Medicare payments to doctors that have always been promised but never put into effect. The CBO also never projects less revenues from taxes due to the drag those revenues have on the economy even though it is a well known effect. Read the entire report and then let us decide who lives with a fantasy about debts and deficits.

    http://www.cbo.gov/sites/default/files/cbofiles/attachments/March2012Baseline.pdf

  82. @Greg F – This is how conservative myths propagate and turn into “zombie lies“.

    The CBO says their latest projections have changed little since their original 2010 estimates.

    For the provisions of the Affordable Care Act related to health insurance coverage, CBO and JCT’s latest estimates are quite similar to the estimates we released when the legislation was being considered in March 2010. The following figure shows CBO and JCT’s projections of the effects of the ACA on the number of people who will be uninsured or will receive insurance coverage through employer-sponsored insurance (ESI), insurance exchanges, or Medicaid or the Children’s Health Insurance Program (CHIP). Although the latest projections extend the original ones by three years (corresponding to the shift in the regular 10-year projection period since the ACA was first being developed), the projections for each given year have changed little, on net, since March 2010.

    The charts and graphs show little discernible difference, yet conservatives like yourself see this as a 100% increase – the cost doubled.

    What? Fantasy-land.

    Do not go on the TV show “Are You Smarter Than a 5th Grader” – based on your math skills, you’ll lose.

    Furthermore, the numbers you point to are *gross* outlays. The ACA also has revenue provisions. The CBO report also shows those revenues *increasing*. The *net* change since the 2011 estimate is $48 billion *less* than the previous projection. I.e., The “Net Cost of Coverage Provisions” drops from $1,131 trillion to $1,083 trillion over the ten-year period.

    Rather than listening to the echo chamber – read the actual reports.

    CBO 2010 original estimate
    CBO 2011, if ACA repealed
    CBO 2011 cost summary
    CBO 2012 cost update

  83. “The CBO also never projects less revenues from taxes due to the drag those revenues have on the economy even though it is a well known effect.”

    Yes, the 1950s were a horrible period with those confiscatory tax rates. And the 1990s – oh my god, how did people survive?

    Fantasy-land.

  84. Kenneth Fritsch said

    “It’s going to be okay, folks. Really. This is the real American century.”

    It gets better. Fanaticizing with some sloganeering thrown. How reassuring can you get? And without talking about any of those scary and nasty details. Yes, Virginia this is America’s century.

  85. Jeff Condon said

    Kevin,

    “Yes, the 1950s were a horrible period with those confiscatory tax rates. And the 1990s – oh my god, how did people survive?”

    The taxes on the wealthy were higher, however the simplistic statement that they were high ignores the shelters that used to be available. In a similar sized business, I doubt very much that I would be paying the kind of taxes I am now.

    Is there any method by which you could decrease your ignorant demeanor or is that switch broken?

  86. Kenneth Fritsch said

    Still wating to hear where and how you came up with a balanced budget in 10 years, Kevin. Please feel free to share your dreams with the rest of us.

  87. Carrick said

    M Simon, I understand the relationship between prohibition and corruption. I expect a certain amount of corruption in government as well as in industry, so I am never surprised when I see it. So I think I do “get it”. The drug war is an industry, people are making money off of it, and not just the smugglers and drug pushers.

  88. Kenneth Fritsch said

    “Yes, the 1950s were a horrible period with those confiscatory tax rates. And the 1990s – oh my god, how did people survive?

    Fantasy-land.”

    The point was that the CBO is almost always going over estimate tax revenues from tax increases and under estimate taxe revenues from tax cuts because they admittedly tell you that they make no efforts to estimate the effects of taxes on the economy. It is like to those who would listen: Please do not accept our estimates without the disclaimers and provisos – that is the stuff of Fantasy-land.

  89. TGSG said

    “Is there any method by which you could decrease your ignorant demeanor or is that switch broken?”

    Not too sure it was ever installed.

  90. Carrick said

    Kevin:

    Rather than listening to the echo chamber

    Oddly Kevin comes across as a regular MSNBC viewer. Funny he would give lectures on not listening to echo chambers.

    He also starts with odd assumptions about the readership on this blog and a level of hostility towards ideas foreign to him matched only by Ed Schwarz.

  91. Greg F said

    The CBO says their latest projections have changed little since their original 2010 estimates.

    Are you really that dim? I don’t care what their latest projections are or how they have changed. The historical reality is CBO’s projections 5 years out end up being pure fantasy. I even showed you an example where their 3 year projection was way off. What sane person would consider any of their projections to be anything other than a wild guess? And this is what you present as evidence? Then you accuse anybody that doesn’t agree with you must be living in fantasy land. You are nothing but a pathetic little political hack.

  92. Greg F said

    Yes, the 1950s were a horrible period with those confiscatory tax rates. And the 1990s – oh my god, how did people survive?

    Nobody actually paid “those confiscatory tax rates”.

  93. Kenneth Fritsch said

    Kevin, does that mean that politicians, including your liberal buddies, should be suggesting that we return to the tax rates of the 1950s and with the current exemptions and deductions? Do you really think that if you collected the tax revenues from that scenario there would be no effects on the economy. Even your Keynesian pals do not believe that.

  94. Kenneth Fritsch said

    Carrick, perhaps we need a compromise of: if you stay out of my bedroom I’ll stay out of your kitchen and gun cabinet. Unfortunately most of time the partisan compromises go the other way- let me peak into your bedroom i’ll let you look into my kitchen and gun cabinet.

    The PBS special on Prohibition was very revealing on how the politics of emotions can have lasting and adverse effects. The Anti-Saloon crowd pushed for the 16th amendment for an income tax because the government depended on alcohol taxes and the income tax could replace that tax and make it easier to prohibit alcohol. Many diverse groups favored prohibition in the end, including leftist groups, that considered drinking a devilish capitalistic plot against the workers. The beer brewers wanted to save their own industries but in the process wanted to place the evils of drinking on the distillers. Many industrial leaders like Henry Ford favored it because they were convinced that drinking was significantly reducing the efficiency of their workers – think Warren Buffett today on taxes and people whom you might want to run a business but never the country. WWI against Germany worked to the advantage of the Prohibitionists in that many brewers were of German descent and evil motivations could be more readily applied.

  95. Jeff Condon said

    Michael Medved makes the point that taxes sit at 18% of GDP these days no matter what you do. He seems pretty close. Increase tax, economy down 18%. Decrase tax, economy up – 18%.

    There is a limit to what the goverment can suck. It is of course also based on where the money is spent. Economics a is about flow as much as resistance.

    Net tax vs GDP is pretty magical in its value. Differential equations with unknown coefficients having a known surety of percent revenue stability. For the math inclined, there is a balance in these equations which has never been accurately quantified. The equations are probably more complex than climate science.

    How much more can a person produce – when they have to?

    Really! How much harder can you drive yourself if your family needs to eat? What if you really want more for them?

    Can a person really outshine the rest of similar ability with enough effort?

    America has proven this answer, beyond a shadow of a doubt, already.

    Give ANY people the opportunity, they will show the world. Take the success out of the success equation through overly progressive taxation, costly anti-business regulation, and the little guy loses the incentive to do the big thing.

    IMHO, This is the single greatest problem with liberalism.

    Through regulation, those with the most $$ control the rules. e.g. GE influences the laws for how wind turbines are produced. The little guy is presented with increased hurdles to create a better future for himself. When the little guy looks at the government employee working 35 hours/week with a guaranteed pension with jealousy, we have gone way too far down the wrong path.

  96. Greg F said

    Michael Medved makes the point that taxes sit at 18% of GDP these days no matter what you do. He seems pretty close. Increase tax, economy down 18%. Decrase tax, economy up – 18%.

    Receipts and Outlays as a percentage of GDP 1940-2010
    http://www.taxpolicycenter.org/taxfacts/displayafact.cfm?Docid=200

    • kuhnkat said

      Greg,

      those estimates look like Climate Models. no matter what, revenue will go up in the future!!!

      And they will keep inflation in check and won’t let spending grow too fast!!

      HAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHA

      I think 2011 and 2012 have already been falsified.

  97. Kenneth Fritsch said

    “America has proven this answer, beyond a shadow of a doubt, already. ”

    It is very important to distinguish between an economic system and the people participating in that system. There is nothing magical about Americans as a people as some politicians want you to believe. Americans would react no differently than the Greeks given their economic system. There is nothing magical that would preclude Americans the same fate as any other national citizens given their mistakes and failures to deal with economic realities.

    The Greeks were very comfortable with the largess that their government was able to borrow in order to support their unreal welfare systems. The common currency and the implication that other nations would bail out Greece made borrowing much cheaper than it would have been given the absent the Euro. The other Euro nations were very much aware of this problem and thus invoked standards for borrowing and debt/deficits that were to be imposed with penalties. Governments being what they are and known for a bit of fantasy never imposed those sanctions. When the Greek interest rates on their bonds increased with the sudden realization (think housing boom elsewhere in the world) that the Greek economy was not sustainable those higher interest rates meant that the Greeks could no longer meet their debt obligations – and even when cuts were made that caused the Greeks to revolt against. I would suppose that we could find quotes from Greeks prior to the Realization that this was the century of the Greeks.

    The Greek fantasy could very much be an American fantasy and with the same reaction by those disappointed citizens who were led to believe that there are free lunches. You can call Greece a third rate economic power but in actuality the Greek economy was not all that weak. The problem was a government that overspent and borrowed because of the false security that the Euro provided. The US suffers a similar fantasy with the US government securities continuing to be the destination for the flight to safety of money and particularly with global emergencies. That fantasy can become reality some time in future and actions like printing money to pay off the debt will surely end it sooner than later.

  98. M Simon said

    Carrick said
    March 18, 2012 at 2:18 pm

    M Simon, I understand the relationship between prohibition and corruption. I expect a certain amount of corruption in government as well as in industry, so I am never surprised when I see it. So I think I do “get it”. The drug war is an industry, people are making money off of it, and not just the smugglers and drug pushers.

    A “certain amount of corruption”? OK. How about enough to cause a major depression world wide? Destroy the real estate market around the world? I would venture that it is a little more than the “certain amount” you envision.

    Classic pump and dump. The pump from about 2002 to 2008 (roughly) and the dump since (and still on going).

    Liberals are only useful idiots in this game – as are the prohibitionists. Between the two they probably account for 60% of the population. And they will keep the game going as long as they can. If only our problem was the misguided left/right. What do you do about the people who acted with intent to cause the collapse? And to do that they have to perpetuate the errors of “both” sides. And the central error of “both” sides?

    Government can fix it.

  99. M Simon said

    Let me explain in simple terms:

    1. The Left – “the best way forward is…”
    2. The Right – “the best way forward is…”
    3. The Crooks – “How much can we steal?”

    And they do this by preying on the best instincts (if not the best thinking) of both sides. “We want to help.”

    The right does not remember the iconic poster “We are from the Government and we are here to help”. Or worse maybe they do want the guns turned on their fellow citizens.

    And the left? Well Jim Crow was a government program. Instigated at the Federal level by a Democrat.

    The government can’t fix it. The government can only make it worse

  100. [...] at the Air Vent Jeff is discussing politics. In the comments a classic left/right confrontation is going on. To cap [...]

  101. Be Green said

    Obama steps in to the worst financial situation this country has seen since the 20s/30s and the 2010/11 deficit is his mess? Fantasyland…

  102. Jeff Condon said

    #101, He ‘stepped’ in and with less $$ spent 600 billion more. It is you that is in fantasyland.

  103. Kenneth Fritsch said

    While I await an answer from Kevin on where he obtained the scenario that led to a balanced budget in 10 years by doing nothing (that is, of course, the CBO calculation that in the most recent report shows a $303 billion deficit in 10 years) I think we should discuss some of those ratios that Kevin has pointed to and particularly the revenue to GDP.

    That very low current ratio as observed in the CBO report that I linked above is, of course, the result of the recent recession where economic activity decreases and so does the government revenues as a consequence. To imply that we need to raise taxes/revenues during a recession/recovery because our revenue to GDP is supposedly out of whack gets to the very dilemma that Greece found itself in recently. We have a nation that can make interest payments on its huge debt providing that its economy remains operating at reasonably high level and that interest rates remain low. When both of those conditions failed Greece was no longer able to sustain its debts through interest payments. The snowballing effect to make this situation worse was that Greece now has to increase revenues during an economic down turn and that makes that situation even worse because of the drag that it has on the economy. The other part of that equation is that government programs had to be cut back and the reactions of the Greeks to those cut backs and their continuing and successful resistance to large cuts.

    What we see in the CBO report going forward over the next 10 years is that that ratio of revenue to GDP goes to some very hefty levels as seen in Table 1 where nothing changes with regards to expiration of all the Bush tax cuts, obtaining the doctor fees cuts for Medicare which have been on the books for long time and never imposed and ending the payroll tax reductions. Using the alternative scenario where the current tax rates and payroll tax and doctors fees for Medicare remain in effect the ratio of revenue to GDP still climbs by a healthy 25% in 10 years.

    The Greeks, as Kevin noted, under the Euro could not print money in attempts to inflate their way out of a debt crisis and the US does have its own currency to print. What happens to interest rates when and if the US decided to print its way out of debt. Currently the US has the false sense of security, much like the Greeks had one with the Euro, in that our government securities are still considered a safe haven and thus carry an interest rate lower than it would necessarily be otherwise. If the US embarked upon a policy of inflating our currency (and here I am referring to more than the heavy printing of money that has already occurred) I would judge that the dollar would lose its safe haven status and interest rates would climb. In fact that might well happen under the current level of printing. Some nations have also turned on their printing presses in attempt to devalue their currency versus the US in hopes of maintaining a trade advantage – Brazil being a prime example. With high interest rates for US debt the next economic downturn could very well put the US in crises mode in maintaining its debt load and particularly so if it were deemed that the revenue to GDP had to be maintained at some high level.

  104. Carrick said

    Be Green: Obama steps in to the worst financial situation this country has seen since the 20s/30s and the 2010/11 deficit is his

    “The worst financial crisis” is a liberal meme used to discredit people who point out the obviously failed policies of the Obama administration. It’s just more proof you guys would through everybody under the bus to gain and maintain control of this country.

    I know this isn’t fashionable for me to say, but the Carter recession by the numbers was far worse this this one (give Obama time though, he’s working on it, by the time he’s through with us, we’ll know what hit us). Let me guess, blame Bush. No wait, Reagan, anything but farged-up liberal economic policy.

    It can be reasonably argued in fact that some of the worst effects of this recession are related to uncertainty generated both by liberal policies and rhetoric. That includes the unemployment numbers which have to do with companies with large cash reserves not hiring and with incentives given to workers to not return to the market.

  105. omanuel said

    In the middle of posting, my computer has lately disrupted everything by losing down the web.

    At the caucus gathering on Saturday, I talked to many ordinary citizens:

    http://www.semissourian.com/story/1827072.html

    I do not understand economics, sociology, or politics, so I joined an anthropology discussion group to see if they have a better explanation for the corruption of science: http://openanthcoop.ning.com/profile/OliverKManuel

    http://omanuel.wordpress.com/about/

    They are deeply concerned: Something is seriously wrong in government!

  106. kuhnkat said

    Begreen,

    as I pointed out above, Obie, more than many others, is PERSONALLY responsible for a chunk of this problem. He was also among the group that ranted racism everytime ANYONE tried to rein in the Housing debacle. Yes, a very small group of Democrats actually spoke out also.

    As M Simon points out, the crooks in both parties, and no party, were very happy to clean us all out on the backs of those insane policies. Hope you enjoy empowereing George Soros and his billionaire club!!

  107. Paul Krugman chips it today with his thoughts on the matter:

    March 19, 2012, 9:18 AM
    The Mighty Wurlitzer in Action
    Read the comments on today’s column and you’ll find many, many references to the alleged fact that the estimated cost of the ACA has risen by a trillion dollars — which happens to be a complete lie.

    The remarkable thing is how quickly the lie has become part of what everyone on the right knows. And even if some of the people citing this “fact” could somehow be convinced that it wasn’t so, they’d brush it off, because there’s such a pattern of liberal duplicity, demonstrated by lots of other supposed facts — all of which are also lies.

    This is the reality of modern American politics: a large and cohesive bloc of voters lives in an alternative reality, fed fake facts by Fox and Rush — whom they listen to out of tribal affiliation — and completely unaware that it’s all fiction.

    Fantasy-land.

  108. @Kenneth – the Do-Nothing option is an analysis of the CBO’s “The Budget And Economic Outlook: Fiscal Years 2012 To 2022″. Under Alternative Fiscal Scenarios with “baseline” assumptions, even with modest economic growth projections, the federal deficit is currently set to shrink from $1.3 trillion in 2011, or 8.7 percent of GDP, to just $196 billion, or 0.9 percent of GDP, by 2018.

    OK, so it’s not technically in balance – it’s a deficit of $196 billion. I think the point is clear. You can do *nothing* and reach a very manageable debt burden; averaging 1.5% of GDP over the period.

  109. CM said

    I think it’s been somewhat lost in the crossfire, but there are useful things to be said about how you can’t compare spending “by President”. (They are after all, just the beetle on the top of the dung pile, and inherit whatever they get from the last lot.)

    That said, I redid my graph from #14 to (a) extend it back to 1970 [1], and (b) put it in log space to uncompound growth [2]:

    http://research.stlouisfed.org/fredgraph.png?g=5On

    You can see that “Reagan” (broadly, i.e., administration, House, Senate) expanded, “Clinton” brought them back together (maybe Gingrich gets an assist), “Bush 2″ expanded (on lower taxes), and “Obama” is bringing them back together. So the original comment does have an element of truth, even if the headline is too simplistic.

    (For what it’s worth, I suspect *whoever* wins in November will use the impetus to do something like Simpson-Bowles. Give it time, let the recovery gain some traction, and see what happens?)

    On ARRA, yes $600bln is a big number. But it was funded at low rates, and given it sorta kinda looks like it worked, maybe it’s not the disaster it appears?

    http://jaredbernsteinblog.com/the-recovery-act-worked-in-a-few-easy-charts/

    (Again, give it a year or two and let’s see. It’s a long game.)

    Notes:
    [1] You can extend it back to 1947 if you want, but it shows nothing significant.
    [2] I was a bit concerned about the apparent flattening-off of GDP, but it seems to be due to lower inflation post-1980.

    [Aside: If you want me to do a bio on the "who I am" thread, or for me to mail one, just say.]

  110. Jeff Condon said

    Kevin 108,

    So whenever you are confronted with difficult quesitons, you change topic?

    The “affordable care act” is a nightmare bill by an extremist government. All Krugman did was expose his own bias. It is unconstitutional in several matters, not that the left cares, and the new price is still underestimated. These are key legal points which must not be ignored by the public or we will lose the ruleset which has created our lifestyles. I don’t wish to discuss this here though. You keep on saying we’re in fantasy land, yet when confronted with facts, you fail to answer.

    On topic – the fact is that Obama added something like 600 billion to the federal government when he took office and lost revenue due to the economic decline. That has resulted in a government representing 25% of gdp whereas federal tax rates historically cannot exceed 18%. These are recurring expenses, not single year stimulus as it was presented, recent years have proven this out. Too much money is already being taken from the economy and the recent massive growth of our government is unsustainable for business- yes Bush was part of the problem.

    We have to cut back on the growth of government. I would prefer a massive reduction but a cutback in growth might get us through. Of course with people like you stomping around pretending to be geniuses, the left-leaning public will remain confused – apparently that is your goal. I’m thinking you have no attachment to business whatsoever. A government employee, union, or perhaps a state job. Somewhere where you don’t worry about making paychecks for people because 90% of the business owners I meet have faced the reality of taxation, and envirowhako rules, and they are on our side.

  111. Jeff Condon said

    “[Aside: If you want me to do a bio on the "who I am" thread, or for me to mail one, just say.]”

    I have never missed a comment from you. Some people stand out by themselves, but it is good for readers to know who they are talking to. The threads here are actually full of some fairly talented people.

  112. Jeff Condon said

    CM is similar to UC at Climate Audit. Read carefully.

  113. CM said

    Jeff, I’ve never posted at CA.

    You have my email and (presumably) IP address. If you like you can mail Steve to check. It’s fine.

  114. Greg F said

    The “affordable care act” is a nightmare bill by an extremist government. All Krugman did was expose his own bias.

    Tom Maguire has a lot of fun fisking Krugman’s dubious arguments.

    Krugman On ObamaCare – Just Make Stuff Up Faster Than The Opponents

  115. Carrick – you’re a hoot. I don’t watch *any* network news. In your first comment you said:

    What Kevin said was flat wrong (and I hope he will admit it, confronted with the facts, otherwise he will paint himself as one of those people whose “myths are etched in stone and actual facts can never sway them from their beliefs”), but reality is more complex than the graphs, because you have to factor in the amount of control of the Congress into it also.

    Which is of course unintelligible. No reference to anything I actually said.

    Clinton is one of these guys who history carried him to where he ended up than somebody who started out with that particular journey in mind. Of course like all “geniuses”, it was his idea all along. After the fact.

    Oh pleeeze. Do we need to walk back through the 1993 Clinton Budget? Do you want me to pull out the votes for and against it by party? Do you want me to pull out all the doom and gloom and catastrophe quotes by Republicans up and down the aisle? In the past I’ve always given credit to Bush the elder – something *Republicans* won’t do – Bush broke his ‘no new taxes’ pledge and that obviously helped. But the 1993 Budget was strictly partisan – you can give the GOP *zero* credit for it – and reality proved all their naysayings were 180 degrees from the truth. Of course that hasn’t stopped them from offering the same exact economic prescriptions everyday since then. They learn nothing. Or – as someone around here said – they live in a fantasy-land divorced from reality.

    You want another example. When Clinton took office the budget deficit was $293 billion. It was projected to go even higher. Yet even after the budget was balanced *more* than 2/3 of Republicans thought the annual deficit was the same or *worse* than when Clinton took office. That’s fantasy-land. Very little has changed in the past dozen years. Republicans *still* think Saddam Hussein was involved in 9/11. They *still* think the ACA will increase the deficit. They *still* think the CRA was the cause of the real estate bubble. What were the predictions from the GOP and their economists when the ARRA was being debated? Skyrocketing interest rates, skyrocketing inflation, increased unemployment. Their whole idea of economics is surreal. The evidence is staring them in the face *EVERY SINGLE DAY* – just go check the Prime Rate. Go look at core inflation. Go look at the unemployment numbers. We have not seen *anything* conservative or libertarian economists predicted. Yet do they change or rethink their beliefs? No.

    A personal example: I was arguing about Republicans *still* believing that Sadaam was involved in 9/11 with a conservative. He said that was made up by the left-wing media. No republicans believed that. I gave him links to 14 public opinion polls covering an 8 year period by 6 different polling organizations that showed in *every* case that more than 50% of Republicans believed Sadaam was involved in 9/11. His reply? “I don’t know why all your polls are wrong.”

    Do you understand that? Do you want to calculate the odds that every one of those polls was off by, what? 15 to 20 standard deviations. It has to be more than all the atoms in the universe to 1. Multiple times over. The sad thing is – he doesn’t even stand out as particularly dumb on the skeptic blogs. Fantasy-land.

    Greg F – I showed you the CBO numbers. I gave you the CBOs direct quote on the matter. I gave you the links to the actual documents. Obviously you have nothing but rhetoric. Fantasy-land. Keep believing that the cost has risen 100%. You make it easy for me to make fun of your ilk.

  116. Jeff Condon said

    CM,

    I didn’t mean to imply you post at CA. Or that you were somehow connected to my views ;) If you read there regularly, UC doesn’t publish his/her identity yet has chops.

  117. @Carrick – In case I wasn’t clear: Bill Clinton campaigned in 1992 on a 5-year plan to eliminate the deficit. The last three years of his Presidency did indeed see surpluses. Now, he went from that stated intent to legislative proposals to actualization 5 years later. It *was* his idea all along – not after the fact. I’m *not* a big fan of Bill Clinton, but even I have to give him credit for that.

  118. Greg F said

    Kevin O’Neill perhaps before you make an accusation you should first come out of the “Fantasy-land” you live in. You make the accusation:

    Obviously you have nothing but rhetoric. Fantasy-land. Keep believing that the cost has risen 100%.

    I never once said or implied that the “cost has risen 100%” or any other amount for that matter. Never. Now we will see if you have even one ounce of honesty or integrity. We will see if you can admit you were in error. We will see if you have the backbone to retract the above and apologize for making an obviously false accusation.

  119. @Carrick – “reality is more complex than the graphs, because you have to factor in the amount of control of the Congress into it also.”

    Do you have to factor it in? This seems an awful lot like the conservative myth that, “congress made me do it!” The one Jeff worked into this very post. Well, there’s an answer to that – the veto. Bill Clinton (you know, I really don’t like him) refused to go along with Gingrich and the GOP and was willing to see the government shut down instead.

    Jeff said that Bush inherited a democrat house and senate. It’s the same myth. David Stockman wrote an entire book about Reagan’s wheelings and dealings with congress to buy votes for his pet proposals. Reagan didn’t care about the debt or deficit – he gave lip service to it. Bush Jr had a *republican* house and senate. No, the President is at the very least an accomplice unless he’s been wielding the veto pen.

  120. Carrick said

    Kevin:

    Bill Clinton campaigned in 1992 on a 5-year plan to eliminate the deficit

    Reference please.

    Then explain why it took a Republican congress to make it happen.

    Note that I actually like Bill, I’d vote for him over anybody who’s going to actually be running (yes I know he can’t run), but he’s a politician, he lies for a living. And like most people when then write their autobiographies, they tend to be hagiographic, as is the case with his new book (Back to Work), which I own.

    If you don’t watch MSNBC, you could have fooled me. You sound just like Olbermann both in your way over the top rhetoric and in the content of what you say.

  121. Carrick said

    And before you decide to jump all over me on this book.. yes it’s not an autobiography, but it contains autobiographical material. Hopefully you won’t jump the rails over that one.

  122. Sorry – Greg, I must have confused you with Kenneth.

    Ummm, BTW – *Republicans* controlled the Senate when it was split 50-50. Dick Cheney was VP.

    “So many myths … so little time. The GDP remains tanked and Mr. O’Neill can’t seem to put two and two together.”

    Rhetoric. Perhaps I should take the apology back. Or do you disagree that automatic stabilizers *automatically* increase spending in an economic downturn? I do believe that’s why they call them *automatic* stabilizers. Yet regard that as a ‘myth’ – OK, I take it back – you could *be* Kenneth for all I can tell the difference.

    • kuhnkat said

      Kevin,

      your rhetorical question is pointless. Keynesian theory actually says it does similar to the Austrians, BUT, the morons that use Keynesian theory ignore parts of what he actually said. Are you one of those MORONS since you seem to think that Obie is just hunky dory?? Do YOU think he should be spending more??

      HAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHA

  123. Carrick said

    Kevin:

    Do you have to factor it in? This seems an awful lot like the conservative myth that, “congress made me do it!” The one Jeff worked into this very post. Well, there’s an answer to that – the veto. Bill Clinton (you know, I really don’t like him) refused to go along with Gingrich and the GOP and was willing to see the government shut down instead.

    Yes it should be obvious you have to factor this in. Only congress can write legislation, any budget necessarily is written by congress not the president. And they can override his veto if he gets too stubborn about what he wants.

    As to not liking him, you could have fooled me, you’re positively hagiographic about him.

  124. @Carrick – you need a *reference* — jesus man, Google: Clinton 1992 campaign eliminate deficit five years

    Lazy too boot. Want me to write your response for you too?

    http://www.trettel.com/ccrc/quotes/quotesClinton.html

    No, the congress the first two years was *democratic* – that’s why the 1993 Budget bill passed without one single republican vote.

    I *know* politics – that doesn’t mean I have to *like* politicians. The first time I saw Bill Clinton doing his “I FEEE – ULLL your pain” schtick I thought Democrats might as well nominate Jimmy Swaggart or Jim Bakker.

    I thought Olbermann left MSNBC a couple years ago?

  125. Carrick – yes, Congress proposes, but – unless the President signs it, or they can over-ride a veto – it does them no good. Rarely has either party had a veto-proof majority. The President is an equal player. More equal in reality, since he also has the power of the bully pulpit.

  126. Jeff Condon said

    “The President is an equal player.”

    An odd statement for one who believes the left has been the fiscally conservative party.

  127. Jeff, I’m not sure what you mean. Democratic *Presidents* have been more fiscally conservative than their GOP counterparts. That’s why the deficits exploded under Reagan and Bush Jr. Bush the elder I’ve already given props to – though he never should have made the stupid pledge in the first place – then he wouldn’t have had to break it. Clinton fought his own party to restrain spending. Obama started talking about deficits in the middle of the worst recession in 70 years – with unemployment at the time still > 9%.

    We don’t have laboratory experiments in economics – but this has been as close as we’re going to get. One economic theory predicted massive spending would do little to move inflation or interest rates. The competing theories said that massive government spending *had* to move them drastically.

    Only the deaf, dumb, and blind cling to theories that are contradicted by all the evidence.

    Where’s DJ Cotton when you need him?

  128. Carrick said

    Kevin, You made a claim, I just asked for substantiation. You have to be an asshole about that too?

    When was the five year plan put in place? When the dems had control of the legislature, right?

    Oh wait…

    I thought Olbermann left MSNBC a couple years ago?

    Then you know more than I do about MSNBC.

    Carrick – yes, Congress proposes, but – unless the President signs it, or they can over-ride a veto – it does them no good. Rarely has either party had a veto-proof majority. The President is an equal player. More equal in reality, since he also has the power of the bully pulpit.

    Equal powers… what was intended. He is one voice, they are many.

    They write the legislation, he can’t force them to write anything they don’t want to.

  129. Carrick said

    Also Kevin, given the way you’ve reacted to evidence when faced with it, I wouldn’t be claiming any special prize for objectivity on this thread.

    • kuhnkat said

      Carrick,

      I would point out that Clinton shutting down the gubmint rather than bend over for ALL the Republicans wants burnt them bad and they have never recovered. Alternate scenario, they use that as an excuse to explain their giving in to the bullying of the Democrats to keep people thinking they really are conservative!!

  130. Carrick said

    I also note you use that poser Krugman as a source. That tells anybody with a brain where your political thought leans.

  131. Carrick said

    Fantasyland indeed.

    If Krugman didn’t exist, conservatives would have to invent him.

  132. Carrick ““The worst financial crisis” is a liberal meme used to discredit people who point out the obviously failed policies of the Obama administration.”

    Ummm …. it might have more to do with the financial meltdown and the fact GDP ‘growth’ was at -5% when Obama took office. Just sayin’.

    I don’t know, perhaps you fell asleep during 2007 and 2008.

  133. Carrick said

    Kevin, you’re just being a dweeb now.

    Check your facts, they won’t burn you.

    Compare 1978-1982 versus 2007-2011.

  134. Carrick – confronted with evidence of what?

    Let’s see: Krugman said there was a housing bubble 3 to 4 years before it burst. GOP economists and pundits were by and large pooh-poohing the idea even *after* it burst.

    Krugman predicted interest rates would not rise substantially even with a huge increase in government spending.
    Krugman predicted inflation would not rise substantially even with a huge increase in government spending.

    Isn’t this what *science* is about. Testable theories? Conservative economic theories failed during the 1990s in regards to the Clinton budget plans. They failed again miserably in predicting what would happen in the wake of the ARRA. I don’t know if they’ve ever predicted anything correctly. Remember, “Cut taxes, increase defense, and balance the budget.” Yeah, that may have been the beginning of conservatives willing to believe any old snakeoil salesman. How much education did a person need to know that dog wouldn’t hunt?

    You either believe in the methods of science or you don’t..

    Conservative economic theory has been a complete and total waste of everyone’s time. Libertarians don’t even rate that high.

  135. Greg F said

    Ummm, BTW – *Republicans* controlled the Senate when it was split 50-50. Dick Cheney was VP.

    Even with the simplistic team red – team blue the Senate was only 50 -50 for 4 months but not in the world of real politics. I will repeat it here as it appears you didn’t quite get it.

    Bush Jr. was in office from the 107th to the 110th Congress. The Democrats controlled the Senate for the 107th and 110th Congress (4 of the 8 years). The 107th was split 50 -50 until May of 2001 when Sen.Jeffords (Republican) from Vermont changed to independent and proceeded to caucus with the Democrats. Other notable Senate RINO’s would be Olympia Snowe, Arlen Specter, George Voinovich, and Lisa Mukowski, The ideology that controls each house in Congress is not black and white (or should I say Red and Blue). To argue party affiliation is equivalent to ideological affiliation is naive to the extreme. Any argument that Bush Jr. was a fiscal conservative is equally naïve.

    Can you grasp that? Jeffords party affiliation had nothing to do with his ideology. He has always been left of center. Just like the other RINO’s I mentioned.

    Rhetoric. Perhaps I should take the apology back. Or do you disagree that automatic stabilizers *automatically* increase spending in an economic downturn?

    The “*automatically* increase spending” is what happens when you have cowards as leaders. The only sane thing to do when budgets get tight is to reduce spending. Anything else is kicking the can down the road. The real problem is you seem to have a need for a black and white bad guy – good guy fantasy land. Reality is not so simple. What you said:

    GDP in an economy that just tanked thanks to GOP policies …. ummmm I did say that safety-net spending and automatic stabilizers *increase* spending in a bad economy.

    Did you watch the video posted by Carrick in #60? Are you so invested in the black and white good guy’s – bad guy’s myth that you can’t see that reality is far more complex?

  136. Carrick – There was no ‘financial crisis’ from 1978 – 1982 it was a recession. A deep one, but not as deep as the Bush Recession. There is a difference between financial crisis and economic crisis. I think you may be conflating them.

  137. Greg says: “The “*automatically* increase spending” is what happens when you have cowards as leaders.”

    Which means Greg F has no clue what he’s talking about. I doubt he even *knows* what the automatic stabilizers are. Why is it cowardly to have these programs? What specific piece is cowardly? Should we only have automatic stabilizers in good times — kind of moronic – but I’ll follow him where ever:)

    Jeff, Carrick. You guys buying the “automatic stabilizers are the result of cowardly leaders” schtick? Just trying to gauge how many acorns are in the tree.

  138. Greg F said

    Let’s see: Krugman said there was a housing bubble 3 to 4 years before it burst.

    And Democrats in the Senate were pooh-poohing the idea in 2004. See the link by Carrick in #60. How long you going to ignore that video? As far as Krugman goes, even a blind squirl find a nut once in a while.

  139. Greg F – go read #10. You haven’t added *anything* from my original description of the situation. I spelled it out right at the top. Buy a clue.

  140. Carrick said

    Kevin, as is your want on this thread, what you mean is malleable and changes over time. A minute ago you were discussing GDP, which is an economic indictor and now you’re trying to thread the needle between “economic” versus “financial” crisis.

    If you were one of the individuals who were out of work, it sure as hell it was a financial crisis… it was the only triple double in the history of the modern US economy:

    We suffered from 10% + points each unemployment, interest rates and inflation during that recession.

    Overall things we were much worse off, and the Midwest still shows scares of the damage caused by that recession.

    It’s obvious you don’t like republicans and and republican presidents, but Reagan did pull us out of that, and set up the stage for 30 years of nearly continuous growth with his reforms.

    The only thing that seriously bothers me about Obama is his insane fiscal policy. It’s sad that somebody who is otherwise relatively sensible can’t see just how screwed up it is.

  141. Carrick said

    Regarding #10, defend per capita spending again Kevin. Then explain how the new learning has taught us the Earth is shaped like a banana.

    This a completely retarded way of looking at numbers of smells of cherry picking. Percent of GDP, as has been pointed out above, is the gold standard here. If you want to move away from it, you need a more compelling reason than it makes your otherwise risible claims look like they make sense.

  142. Jeff Condon said

    [self snip] meh.

  143. Carrick said

    Jeff, in case you haven’t noticed, Kevin claims whatever he needs to claim, no matter how bereft of any logical train of thought, in order to bolster his own religiously held beliefs.

    I’ll admit you and I don’t always see eye to eye on fiscal policies and economics, but I will give you credit where I can’t give him, at least you attempt to retain some sense of coherence in your arguments. Kevin is everywhere simultaneously, he reminds me of a point guard on crack.

  144. Carrick said

    My data is more interesting, unless something changes dramatically, Ima gonna skip out on the rest of this one. Interesting findings.

    I’m sick of purely political debates, people need to be able to a) decide what are the correct metrics, then b) decide what those metrics mean.

    Serioso was the first to hit on it (#7) IMO, that you need to normalize to GDP.

    Here’s Kevin’s take on it:

    You are being disingenuous aren’t you? GDP in an economy that just tanked thanks to GOP policies …. ummmm I did say that safety-net spending and automatic stabilizers *increase* spending in a bad economy. A bad economy *means* GDP is not increasing at the optimal rate. The percentage *has* to rise. It wouldn’t matter who was president. Obviously you should be smart enough to know that – or perhaps I give you too much credit. Are you completely ignorant of counter-cyclical policies? Why don’t you just do the work and deal with actual *spending* – you know, the point I actually brought up?

    Any facts that don’t support his “reasoning” must be wrong.

    Tom Fuller #69 gets it 100% right IMO when he says:

    Why on Earth would we talk about debt without normalizing comparisons to talk apples vs. apples? Percentage of GDP is the only thing that matters, because GDP is the source of the credit that allows the debt and the resources required to repay it.

    Start with the methodology, agree to that, then move to what it tells you.

  145. To all: Look, I’ve posed the question several times to several different people:

    What economic theory *predicted* that massive government spending accompanied by massive government borrowing would *NOT* substantially raise interest rates or inflation?

    What did the competing theories predict?

    Now, I know you *can’t* answer that question. It’s a dirty trick on my part.

    Carrick has time to complain cause he doesn’t like my attempt at humor (Lazy to boot. Want me to write your response for you too?)

    Greg F is all bent out of shape because — oh who knows or cares why Greg F is bent out of shape. he’s just bent.

    Jeff, drops in with whatever.

    Kenneth is lately absent – though not missed.

    No one answers the question. It’s written in invisible ink. Mention Krugman, and the rhetoric flies – but no answer to the question. It’s really the only important question – which economic theory is correct? If your economic theory is incorrect, then you’d have to reassess your prior beliefs – well, we know *that* ain’t going to happen. So, I realize I’ve done all I can. I’ve exposed you to a question you can either choose to answer or not. You can think about it or not. I can’t force you. I don’t know any of you well enough to care. So, you can continue to deride the *one* theory that has proven to be correct, but what does that prove or mean? Nothing complimentary I’m afraid.

  146. Jeff Condon said

    “Jeff, drops in with whatever.”

    You haven’t answered any of my previous comments, why try more?

  147. Greg F said

    Greg F – go read #10. You haven’t added *anything* from my original description of the situation. I spelled it out right at the top. Buy a clue.

    I actually read the link but I am guessing you didn’t or at least read it very carefully. Let me buy you a clue. It isn’t per capita spending. Read the title of the graph.

  148. Greg F said

    What economic theory *predicted* that massive government spending accompanied by massive government borrowing would *NOT* substantially raise interest rates or inflation?

    The one that will be shown to be wrong. Its easy to sell to the ecomomically ignorant that don’t understand the velocity of money. Inflation is already up, just go to the grocery store. I pointed this out to you before but facts don’t seem to sink in with you. Corporations are sitting on 2 trillion dollars in cash. That doesn’t include cash held by the average Joe. When the economy starts heating up and people get confident they will start spending again. That is when you will see the effect of printing currency.

    Did you watch that video yet?

  149. Jeff Condon said

    Naw Greg, Inflation isn’t happening! Bananas are growing due to increased CO2. You don’t expect to pay the same amount of money for bigger bananas do you?

  150. kuhnkat said

    Inflation?? Naah, couldn’t be. My 84 year old mom is still buying things for 99 cents at the 99 cent store right? RIGHT?? Except, her favorite cookies dropped the package size and contents by 1/3 and a number of other decent items have simply disappeared from the shelves.

    We are now at $4.27 for the cheapest in our area. In 2009 it was about $2.80. That FDR ponzi scheme isn’t keeping up very well for her. I think she got about $50 more per month this year. That barely covers the increase in gas. It is 1/2 mile to the nearest bus stop and she wouldn’t be able to carry the groceries anyway so doing without the car gets iffy. Then there is the increase in electric prices here in California driven by the insane policies of the Dhimmicrats. Thank goodness the trailer has GAS heating. Her electric still runs about $60/month as she only runs it when it gets too cold for her with clothes and blanket on. Can’t imagine how people not in the south can afford to heat their homes. Then there is the continuing decrease in the quality of her medical care…

    There is inflation and it is hitting the people at the bottom the hardest, as usual. The Dhimmicrats care more about the agenda than the people and have for a long time or they would have learned from the failures of FDR, Papa Joe, Mao Tse Tung, Castro…

  151. amabo said

    Hmm, I THOUGHT things were getting austrian up in here.

  152. w.w.wygart said

    Jeff,

    I think you let yourself get snookered in this argument. Presidents don’t spend money, Congresses do. As you have shown, aside from the fact that getting the real and complete numbers on what our Government spends has been made deliberately very difficult, it is also difficult to make sense of what spending belongs to any particular President and his ambitions rather than the current Congress’ pork and past Congress’ mandates. Clinton for instance always tends to look good in the above charts, not because he was naturally fiscally responsible, it was because he had an opposition party Congress that FORCED him to live with his means. No President can spend more than Congress will allow.

    W^3

  153. Kenneth Fritsch said

    “@Kenneth – the Do-Nothing option is an analysis of the CBO’s “The Budget And Economic Outlook: Fiscal Years 2012 To 2022″. Under Alternative Fiscal Scenarios with “baseline” assumptions, even with modest economic growth projections, the federal deficit is currently set to shrink from $1.3 trillion in 2011, or 8.7 percent of GDP, to just $196 billion, or 0.9 percent of GDP, by 2018.

    OK, so it’s not technically in balance – it’s a deficit of $196 billion. I think the point is clear. You can do *nothing* and reach a very manageable debt burden; averaging 1.5% of GDP over the period.”

    Kevin, in 10 years the Do-Nothing option has the deficit at 303 billion dollars. If I can compare that number to a very large number it will appear smaller but on an historical level 303 bilion dollars (and estimated by the CBO who admittedly always underestimate deficits over the long term) is large. When you said the budget would balance in 10 years doing nothing you must have been fanaticizing. At least if you carefully read the provisos and disclaimers of the CBO they admit to a bit a fanaticizing – and being required by the politicians in Washington to do it..

    In 10 years from 2013-2022 the CBO has the GDP growing from $15.508 trillion to $24.655 trillion which yields a compounded average annual increase of 4.75%. If the growth were 3% the GDP would increase from $15.508 trillion to $20.841 trillion. The 4.75% growth (and particularly in the face of increased taxes of the Do-nothing scenario) is a very optimistic estimate for growth for the economy. The alternative scenario, that the CBO’s obviously calculates for those who are not living in a dream world, paints a very different picture and one that should be discussed and particularly in light of the fact that the current administration has not offered any ways to get closer to the Do-nothing scenario than the alternative one.

    Kevin, now that we have some perspective on the CBO report perhaps you could give us your Simpson-Bowles rendition of what we need to get back to some fiscal sanity. A bit of advice also and that is I would not keep throwing up the idea that it is the only the conservatives that are living in a fantasy world and that that argument somehow vindicates what the liberals might do and be fanaticizing about.

  154. Jeff Condon said

    Kenneth,

    While your tone is endlessly reasonable, it is very obvious which policies are adding the costs and which party is primarily responsible. Kevin’s answer is continually that it is the Republicans (whom, like you, I am tired of) and this fallacy exists only in his head, and is not a small departure from reality. The liberal party has added the vast majority of the financial load to our government over the years through, economically depressing law as well as entitlement expansions. Unlike W^3, I recognize that Obama is one full branch of government. He has an enormous responsibility for the huge economic load added on when he took office through the stimulus bill and various executive orders. In fact, his anti-industrial executive policies, as well as the EPA nonsense, have pressured our economy down while spending, which he directed to be written by congress, has gone up. Kevin’s position is not one of reason. He just stomps about calling conservatives fools who live in fantasy world and has done nothing to back it up. Lets not even begin with the housing loan crisis. All of it falls squarely on the liberal party with plenty of Republicrats hopping along behind.

    For the first time inf forever, I’m not even sure I’m going to vote in this primary (probably will for the local stuff). I’m not happy with any of the choices and when it gets to the end we will only have one anyway. I don’t think Santorum can hold his own in a side-by-side discussion and Mitt is a leftist saying conservative things. The others aren’t worth discussing because they won’t be there.

  155. Kenneth Fritsch said

    Jeff, I think Kevin probably does not feel comfortable defending the current administration or the spending policies that have gotten us to this point. Those policies are part and parcel to almost all politicians in Washington, who like the politicians in Greece, could not say no to the demands of bigger government programs from the voters. How does a partisan politically defend his side’s weaknesses? By going on the offense and hoping the responses will be the other side attempting to defend the indefensible. If we quit the partisan debates and concentrate on what the government is doing and not doing we might have a reasonably intelligent debate.

    By the way it is correct that Krugman called the housing bubble and the breaking of it. Not many of his Keynesian brethern had that one right. On the other hand the Austrians got the bubble and bursting right almost to the economist. What is important in that debate is the reasoning behind the calling of the bursting and that was very much different between Krugman and the Austrians. Obviously Bernanke and the Federal Reserve did not have a clue – nor almost all the politicians in Washington.

    By the way I have seen a study recently, that I must find a link to, that shows those governments that were able to put their fiscal houses back in a reasonable order, at least temporarly, did it by reduced spending. Those that attempted to do it through higher taxes were not successful because those new revenuse went to – you guessed it – more spending.

  156. kuhnkat said

    W.w.ygart,

    only Congress spends money?? When was the last time an actual budget was passed?!?!?!?! Exactly what directs Obie’s spending over the last 3 years and into the future?? I would sure like to know since the printing presses are going to need replacement soon.

  157. [...] UPDATE: This link is relevant to the discussion below.   http://noconsensus.wordpress.com/2012/03/17/conservative-fantasy-world/ [...]

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