Free Markets, Free People

Daily Archives: April 15, 2011


The $32.5 billion in cuts are real cuts

They’re not all smoke and mirrors as some are alleging.  But you have to understand the budget process to know that.  Quin Hillyar explains:

Anyway, yes, the cuts are not of the high quality of cuts we might like. Yes, there are a few which can only be characterized as smoke and mirrors. But no, the bulk of these cuts are not meaningless; most of them actually will keep money from being spent that otherwise would, yes, be spent. In other words, most of the complaints are groundless.

Here’s why. This is an Appropriations bill. Approps bills are primarily expressed through "budget authority," not through "outlays." A project in an Approps bill that receives budget authority in FY 2011 might not actually get spent — there may not be an "outlay" of the full amount — in 2011. If it is a construction project, that will almost certainly be the case. This late in the fiscal year — which began last October 1, and thus is more than halfway over — some of these projects may not even get the contracts signed before the end of the fiscal year. So cutting that project would not cut a single dollar from actual spending this year. But that does NOT — NOT NOT NOT NOT NOT — mean that cutting the project is a waste of time. If the budget authority is removed, it means that the money that absolutely would have been spent in future years now CANNOT be spent, by law. It saves real money.

Hillyar worked on the staff of the House Appropriations Committee during the time Republicans balanced the budget and brought Bubba to the table to sign kicking and screaming all the way (you remember Clinton’s "can’t be done" statement, right?).

More clarity about the process:

The savings are real. It’s the same thing with a lot of the items that critics are calling "smoke and mirrors" just because they don’t cut this year’s outlays. The criticism is utterly ill-informed and baseless.

Granted, there also are accounts that contain leftover money that supposedly wasn’t going to be spent anyway — so in this case, say the critics, cutting the budget authority doesn’t save money; it’s just forcing the official accounting to catch up with the reality of the unspent funds….. Well, yes and no. Or rather, maybe. The dirty little secret about unobligated funds is that many of them are in accounts that aren’t impressively tight. Executive branch bureaucracies, without approval of Congress, often can tap into those funds (in effect) for other purposes, merely by shifting them among accounts. Most funds are fungible. That’s why Sen. Tom Coburn is making such a big deal, overall (apart from this battle), about cutting hundreds of billions in unobligated funds: because as long as they remain on the books, they still can get spent, and in most cases will get spent. Therefore, eliminating the budget authority for these programs does indeed save real money. It’s not just an accounting trick. It takes away all legal authority to spend that money. It means the taxpayers will not be on the hook for the money.

So while maybe not ideal in terms of the amount of “high quality” cuts we would have preferred, believing the narrative that they’re all smoke and mirrors is just wrong.  When a program has budget authority, it is funded and those funds will be spent – by someone.  That authority has now been withdrawn and thus the ability to spend even a penny of the formerly allocated funds goes with it.

An even better silver lining (again something you have to understand about the process to appreciate the impact):

Also important is that they force the overall spending baseline lower. So much of what happens in Washington budgets involves comparing spending year to year. If you take away budget authority EVEN FOR PROGRAMS THAT NEVER WOULD GET SPENT, you also make the official baseline for future years lower. It thus becomes far harder for the left to demagogue GOP spending proposals, because the proposals will be compared to a lower starting point than they would if the programs in question still remained on the official books. Anybody who doesn’t think this is an important budgetary victory is either ignorant or a fool.

Or both.

All of these things are important.  Removing the budget authority essentially defunds a program, or, as mentioned, stops it in its tracks and removes the money from being available to the program being defunded.   It also removes it from the grasping, greedy fingers of bureaucrats ready and eager to take whatever money they can get their hands on and spend it.

Best of all worlds?  Probably not.  But certainly not at all the worst of all worlds.  Anytime we can save money and force the spending baseline lower seems to me to be a victory.

~McQ


Obama fails “Leadership 101” – again

You are President of the United States.  All 57 of them.  And you have a challenge in front of you.  The public is alarmed by the level of government debt and sharply rising deficits.  Of course, being a “Constitutional law professor” you know that any action on this must be initiated by the House of Representatives since by law they are charged with the budget and appropriations.  But because of a lack of confidence in the leadership of your party, as they held majorities in both chambers of Congress, the House was reclaimed by the opposition party who now enjoys a solid majority there.

So as a leader, you must address the reality of the situation, tone down the partisan rhetoric, make overtures to bipartisan cooperation and attempt to bridge the partisan gap that you and your party have helped create these past two years.  Leadership 101.

Instead we got this – POLITICO lays it out for you:

President Barack Obama extended a fiscal olive branch to Republicans on Wednesday.

Then he beat them up with it. Obama’s long-anticipated speech on the deficit at George Washington University was one of the oddest rhetorical hybrids of his presidency — a serious stab at reforming entitlements cloaked in a 2012 campaign speech that was one of the most overtly partisan broadsides he’s ever delivered from a podium with a presidential seal.

I differ with the analysis – it wasn’t a serious stab at anything.  No details were present.  Just a “framework”, which is Obama’s usual way of laying off responsibility or outsourcing his job to others.  His entire first term, to date, has been about grand and nebulous words left to others to flesh out.

But back to the point – as someone, I believe it was Paul Ryan, said, instead of building bridges with his speech, Obama went about poisoning wells.

What he essentially acted like was a Senate back bencher throwing verbal bombs at the opposition.  And, of course, if you recall, that’s precisely what he was until he managed to fool enough people into electing him president.

How stupid was it to act as he did this past Wednesday?

But the combative tenor of Obama’s remarks, which included a swipe at his potential 2012 GOP challengers, may have scuttled the stated purpose of the entire enterprise — to start negotiations with Republicans on a workable bipartisan approach to attacking the deficit.

And it didn’t build much goodwill ahead of upcoming fights, especially the looming battle over raising the debt ceiling.

That’s correct – the looming fights have now been made partisan by a president who set the tone.   Donald Trump called him the worst president ever (well, unless Donald Trump were to become president that is).  I have to agree – and I lived through Jimmy Carter who now seems almost competent in comparison.

Carter at least tried to be a leader.  This man makes no attempt at leadership.  He’s a hack politician in way over his head and seems to thrive on political one-upsmanship, partisan bickering and playing politics with everything.

Leaders lead.  Sounds trite and clichéd, but as was said about porn, you know one when you see one.

I’ve known many leaders in my day, and Mr. Obama is no leader.

~McQ


Libyan update

Not much new to report – stalemate continues.  However what we seem to be finally learning is that the so-called “rebels” aren’t organized enough to do much of anything to force the situation:

Too little is known about Libya’s rebels and they remain too fragmented for the United States to get seriously involved in organizing or training them, let alone arming them, U.S. and European officials say.

U.S. and allied intelligence agencies believe NATO’s no-fly zone and air strikes will be effective in stopping Muammar Gaddafi’s forces from killing civilians and dislodging rebels from strongholds like Benghazi, the officials say.

But the more the intelligence agencies learn about rebel forces, the more they appear to be hopelessly disorganized and incapable of coalescing in the foreseeable future.

However, that hasn’t stopped the rebels from asking for a $2 billion dollar loan from the West.  They’re never too disorganized to demand money, are they?  Hey, this is the Arab League’s baby – let them front any loans.  Oh, and check out this photo for a little picture of the reality we’re talking about.

Meanwhile, NATO could use a few more aircraft:

Nato Secretary General Anders Fogh Rasmussen has told a foreign ministers’ summit the alliance needs "a few more" aircraft for its mission in Libya.

Mr Rasmussen said he had received no offers from any ally at the meeting in Berlin to supply the extra warplanes, but he remained hopeful.

I’m sure he does.  Of course, this situation has little if anything to do with the stated mission of NATO (a defensive pact), but it is an organization in search of a mission.   One of the reasons it has to beg for other participants is there’s nothing binding about war’s of choice on NATO members and, as you might expect, a good number of them ore sitting this one out.

Finally, our leaders fight back with a NYT editorial.  Obama, Cameron and Sarkozy have an op/ed there addressing Libya.  This particular paragraph caught my eye:

We must never forget the reasons why the international community was obliged to act in the first place. As Libya descended into chaos with Colonel Muammar el-Qaddafi attacking his own people, the Arab League called for action. The Libyan opposition called for help. And the people of Libya looked to the world in their hour of need. In an historic resolution, the United Nations Security Council authorized all necessary measures to protect the people of Libya from the attacks upon them. By responding immediately, our countries, together with an international coalition, halted the advance of Qaddafi’s forces and prevented the bloodbath that he had promised to inflict upon the citizens of the besieged city of Benghazi.

Tens of thousands of lives have been protected.

I’m sorry, but I couldn’t help but think “jobs created and saved” when I read all of that monkey poo.

Meanwhile in Syria, they’re issuing instructions not to kill over 20 protesters a day because apparently that’s a threshold they know the great protectors of certain civilians will ignore.  Besides, some Democrats think Assad is a reformer, and don’t forget, he hasn’t used airplanes on the protesters – yet.

~McQ

michael kors outlet michael kors handbags outlet michael kors factory outlet