DC’s Never-ending Deficit Scam

By John Sykes

What a never-ending scam! It has taken me forever to workout an understanding of how DC plays with us on the deficit and what needs to be done to actually solve the problem. This post shows why I am worried, how the scam works, and how to get out of the scam. 

Here’s what’s ominous and has me worried. Any time I see “big deal” and “bold action” coming out of Obama’s mouth, and Boehner “endorsing” Obama, I get scared:

House Speaker John Boehner (R-OH) endorsed President Obama’s call for a "big deal." He told Republican Senators that the nation’s economic future requires bold action. The Speaker said he expects a deal to come together quickly — or to collapse under the weight of partisan resistance

DC’s talking about a $2 trillion tax cut for this next deal. It actually cuts less than the interest on our debt and balloons over the 10 projected years of cuts to more debt of about $1.8 trillion.

Enter video caption here

Here’s the scam in action.
Watch the video. DC thinks we are absolute fools.

 

 

So what’s the way out, the best way to evaluate the truth of any deficit reduction? From Fuzzy Deficit Math:

The best way to evaluate the deficit impact of a budget deal, if one occurs, is to look at the budget deficits that would result over the next decade, measured as a share of the economy. Then evaluate that result with a three-pronged test:

1. How do the resulting deficits compare to the historic average of 2% of GDP?
2. How do the resulting deficits compare to the level you’d need to hold debt/GDP constant, about 3% of GDP?
3. What does the path of those resulting deficits look like over the next decade? Are deficits growing, flat, or shrinking over time?

So how do we actually get out of the bulging deficits? The following picture is worth trillions of dollars. All we need to do to get out of future deficits is inherent in the graph. Bring the average spending curve down to the average revenue line. Notice I said bring the spending curve down, not the revenue curve up. We have a spending problem, not a revenue problem!

Related articles

• The Deficit Comfort Zone
• A Phantom Budget - and a Phantom $4 Trillion
• New CBO Budget Baseline Reveals Permanent Trillion-Dollar Deficits

Related cartoons