Wednesday, April 13, 2011

The Epic Budget Battle of 2011

The groundswell that swept the Republicans into control of the house provided three and only three silver bullets for stopping the massive new governmental beast that has spent the last two years on a multi-trillion dollar spending binge.

Those three bullets are:
  • The 2011 budget
  • The debt limit
  • The 2012 budget
That's it until the 2012 election season. The task ahead seemed daunting but Republicans were on a roll. As described on Red State, the teary-eyed Boehner proclaimed;
“We are going to cut $100 billion in discretionary spending next week. Write it down. $100 billion in discretionary spending. And we aren’t going to stop there.”
That seemed like a tepid opening against a deficit that has grown by $100 billion times 10 over the last two years, but hey, like he said it's just a start.

So now the first silver bullet has been fired and we can see the final results. The chart below shows the 2011 federal budget.

The red portion is the $1.5 trillion to be borrowed and the blue portion is the $2.2 trillion of spending funded from taxes. The green portion represents the $38 billion of "cuts" from the budget deal that has turned out to be accounting gimmicks that won't really cut the deficit.

Finally, the yellow area is the $353 million that the CBO office has determined represent genuine deficit reduction.

Still can't see the yellow area? It's in between the green and the blue. No? Here, let me magnify by a factor of 50:There! The yellow line represents the impact of the first silver bullet in the heroic victory that Boehner the Great did achieve against the voracious Spend-a-Beast.

Now in looking at the red section of the chart, portraying the green section as a victory is comical but portraying the yellow section as a victory? That's a farce.

Within two weeks of taking office Obama, Pelosi and Reid managed to blow a trillion dollars on a stimulus that didn't work and the 2010 budget was the budget busting disaster that needs to be slayed. How quickly has the monster appeared? For a point of reference, here is the results from the last time a Republican Congress passed a budget, for fiscal 2007:

This budget looks like a far away dream. More precisely, based on the Ryan budget it looks like a dream that's about 13 years away.

What happened? Quite simply revenues fell by $350 billion and spending increased by a cool $1 trillion.

So where to from here? I'd say that Boehner needs to go and anyone who votes for this should be considered to have the stain from the 2010 budget on his hands. The 2011 budget puts the Republican stamp of approval on ratcheting up government spending by a third, relative to the size of the economy.

Now, perhaps someone can explain to me how this is actually just an elaborate strategy to use the first two bullets to lure the beast closer for the finishing blow, because from my vantage point it looks like pure cowardice. In all seriousness, if this is the best the Republicans can do then I think perhaps we'd all be no worse off to just give up and let the Obama fascists keep hold of the reins as the stagecoach plunges off the cliff.

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