Democrats responded to yesterday’s good news on the budget by predicting that the red ink would start flooding again in future years as the bills for entitlement programs such as Medicare and Social Security come due. Cue state of the union address, where the Dems gave themselves a standing ovation for blocking changes to Social Security.
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Written By:
shark
URL:
http://
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Our deficit is lower as a percentage of GDP than it was in the years before the Reagan tax cuts. IE Carter ran higher deficits than Bush is right now. |
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Written By:
Sean
URL:
http://www.myelectionanalysis.com
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Thought you’d be interested in this analysis of the numbers from Stephen Slivinski - economist, author of Buck Wild, Director of Budget Studies at Cato "The big surprise in the Congressional Budget Office mid-year budget estimates released today isn’t that the year-to-year deficit shrank again. Or that the long-term liabilities in Medicare and Social Security continue to impend. The surprise is that federal spending will only grow about 3% in the current fiscal year that ends this October. That’s a big improvement over the annual average 7% growth we’ve seen since the first day of the George W. Bush presidency. How did that happen? Those familiar with my research will probably not be surprised to hear that the new political reailty – divided government – has something to do with it...
Earlier this year, the new Democratic Congress decided to put the federal budget on auto-pilot until October. Instead of passing new appropriations bills to fund the government for the entire year, they instead passed what is called a “continuing resolution” to keep the government operating. This didn’t happen because the Democrats were all that interested in spending less money. They just wanted to get the old budget work left to them by the outgoing Republican Congress off the table so they could get on with more ideological-base-friendly legislation, like the minimum wage increase. And the Democrats knew that the president might finally start vetoing legislation, too. A protracted battle over the budget wasn’t something they wanted to spend their energy on in the first half of the year. Thus, the auto-pilot continuing resolution: a piece of legislation that keeps the government running at basically the inflation-adjusted level of the previous year.
With the White House veto strategy finally a credible threat*, it looks like we might have a similar sort of outcome on spending this year, too. Isn’t divided government wonderful?" Just another reason to vote for a Republican President in 2008 to maintain a divided government state. |
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Written By:
mw
URL:
http://westanddivided.blogspot.com/
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My prediction: if a Democrat wins in 2008, they will push for a reform of social security that will be very close if not a copy of Bush’s plan. The media will be supportive and it will be a no-brainer. |
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Written By:
Harun
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Harun, my prediction is that they will indeed push for a reform, but it will not include any of those icky private investment alternatives.
And let me be the first to predict a Democrat line circa 2010. "Yes, SS and Medicare will be in deficit because of all the baby boomers retiring right now. But if we just raise taxes a teensy bit now, we’ll get through the boom, and the baby bust after that will lessen our problems."
And that will be the rationalization for a whopping tax increase to fund SS and Medicare. |
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Written By:
Billy Hollis
URL:
http://
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I see bumper stickers...
Protect Yourself and Your Family’s Future!
Vote Divided Government ’08!
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Written By:
RC
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"I see bumper stickers..." - rc It is already on my car.
I just need to to change the ’06 to ’08.
I’ll take my red and blue sharpie pens down to the car and do it now. |
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Written By:
mw
URL:
http://westanddivided.blogspot.com/
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What’s so "funny" about this is that the Democrats have been screaming for years that "Iraq is bankrupting us with huge deficits." They’ve been saying that even as the deficits have been falling.
What they were actually doing was blaming the post-9/11, post-90s bubble doldrums on Iraq and clamoring, as always, for tax increases.
So now that the deficits are way down, as McQ points out, they start up about the coming entitlement explosion which they pooh-poohed during Bush’s largely ineffectual Social Security reform push (the worst moment of his presidency; he proposed essentially nothing, but he proposed a lot of it).
This trend in deficits was in place before divided government came along, by the way. If I’m not mistaken, the budget for this year was passed during the last Congress.
We need to spend more money on the military by adding combat troops, right now, as the top priority. Because we are in a world war that we need to fight more aggressively. And I don’t want to hear the Chairman of the Joint Chiefs talking about the strain on our forces. We need to fix that problem.
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Written By:
Martin McPhillips
URL:
http://mcphillips.blogspot.com/
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"I don’t want to hear the Chairman of the Joint Chiefs talking about the strain on our forces. We need to fix that problem." -MM We do indeed need to fix it. Responsibility for this problem falls squarely on the shoulders of the President, Vice-President, SECDEF Rumsfeld, and Deputy SECDEF Wolfowitz who chose to ignore General Eric Shinseki’s 2003 warning: "Beware the 12-division strategy for a 10-division Army." They did not want to hear what did not fit their pre-conceived notions. Now the chickens have come home to roost.
Also Martin, I hope you don’t mind if I just go ahead and accept Stephens Slivinski’s analysis of the impact of divided government on federal spending this year rather than yours. It just seems a little meatier. |
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Written By:
mw
URL:
http://westanddivided.blogspot.com/
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