Next year's record figure includes only $70 billion for the wars in Iraq and Afghanistan, which could cost three times that much, and it is based on economic assumptions that could prove unrealistic. The White House is assuming economic growth next year of 2.2 percent, down sharply from the 3 percent estimate of February but still brighter than the 1.7 percent growth estimate of many private-sector economists. The White House is also assuming rosier numbers for inflation and unemployment rates.
"That's not the real number," former Bush Treasury secretary Paul H. O'Neill said of the $482 billion deficit forecast. "It's upward of $500 billion and counting. It's a mind-boggling number."
Measured against the size of the economy, next year's mark, at 3.3 percent of the gross domestic product, is still eclipsed by the deficits of Bush's first term, as well as the deficits of George H.W. Bush and Ronald Reagan.
[emphasis mine]
Lotta caveats there; considering that this administration's overall management style has been similar in attitude and efficiency to lighting an enormous bag of dog shit on the nation's front porch and running, the idea that we're all supposed to just take their word for it on all the estimates -- which have yet to have been right or even close -- is ridiculous. And are we including what the housing fiasco will cost the taxpayers, the tens of billions for Wall Street bailouts and repaying the European central banks for their massive loans earlier in the year?
Measuring deficit spending as a percentage of GDP, as with assessing the defense budget, is a handy way to get the numbers to tell you what you want them to tell you, without going into the larger ramifications. It tells you nothing about growing economic disparity, or wage stasis in the face of extensive price hikes, while the people at the top take home more and more and more. It tells you zip about the deterioration of the infrastructure, or the rising tide of poverty that is being studiously ignored.
As with Saint Reagan and Poppy Bush, we are once again in the midst of a great upward wealth transfer, done pretty much right out in the open at that. Their automatic excuse is always that the market will sort itself. How's that been working?
4 comments:
You guys okay down there in Killafornia? I heard there was some shakin' today -- probably way down south from where you live, but you never know with these damn temblors. Take care.
Measured against the size of the economy, next year's mark, at 3.3 percent of the gross domestic product, is still eclipsed by the deficits of Bush's first term, as well as the deficits of George H.W. Bush and Ronald Reagan.
Forget for a moment that GDP numbers are bogus in a world of globalization (e.g., that HP computer made in China by Samsung is figured at full retail as a component of GDP, and that they include gummint spending, fercrisakes, debt is not repaid by GDP, it's repaid by American taxpayers (corporate taxes are merely hidden sales taxes). The only meaningful stat is the increase in debt per taxpayer. I got it figgered at $14 gigazillion.
Thanks for your concern, Marius, but you're right, I'm about 600 miles north of the quake. It burns in the summer and floods in the winter, but we are at least pretty earthquake-proof in these parts.
Coincidentally, though, I did live in Pomona for a few years when I was very young. There was a pretty bad quake in the area in 1971, but I was 3½ years old when that one hit, so I don't remember it.
It's been a long six weeks with the smoke from all the wildfires, but that's finally dissipated.
That's so strange -- I was about 3 and a half when a serious quake hit my home town outside Bucharest, on March 4, 1977. Everybody in my family freaked and bolted out of the house, and my grandma's sister, who was supposed to pick me and run out, forgot that I was there too. So they left me behind while they were trembling outside, on the street--until the old lady realized I wasn't with them. The house ended up OK, but I could have gotten flattened inside. That was probably the last time I got lucky.
It occured to me, as I was pondering this deficits issue, that America won't probably be as lucky as it got financially post-Reagan and Bush 41. Those guys also left huge deficits in their wake,* but luck would have it that the country entered a third industrial revolution (post-industrial, to be accurate) that generated so much extra wealth and economic output that it enabled Clinton to leave office with a budget surplus. No, I'm not talking about the dot-com bubble, which probably only shuffled money around from venture capitalists to other adventurists. I mean the advent of information technology, and the huge increases in productivity it led to--technologies that save money, multiply production, simplify distribution and book-keeping, and enable the design of better, cheaper products.
But a repeat of that stroke of luck is not anywhere in sight right now -- the economic possibilities of IT are pretty much exhausted, unless we count on (1) finding alternative ways to generate affordable energy (wind, wave-power, solar cells, etc.) which America can then sell to the rest of the world for huge profits, or (2) smart products, like biotech and energy-efficient manufacturing. But against this militates the fact that the benefits of (1) are fairly distant and somewhat uncertain, and (2) requires a highly educated workforce, whereas America seems now keen on allowing born-again neanderthals and all sorts of anti-intellectualists to set the cultural tone of the decade and shape education trends. There's a missed opportunity if I ever saw one.
Now, if you thought you're the only one who can engage in big-pic wanking, think again, Heywood. ;-)
*What is it about these Republicans that they spend like goddamn drunk sailors? I wish Democrats would wise up and give them grief for that, but instead they get branded as the party of 'tax'n'spend.' Who's the last Republican president who actually left office with a balanced budget? Ford?
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