Friday, December 21, 2012

Fed. Spending: Even Cavemen Could Understand

Obama and the Democrats continue to ignore spending "cuts" in the current budget debate related to avoiding the "fiscal cliff".   (Remember "cuts" in Washington are only reductions in "planned increases").

President Obama's proposed tax increases on the top 2% of earners would fund the federal government for about eight days.

Democrats are exceedingly unserious about addressing the most serious budgetary issue of the day: spending.   Pretty much every serious person in this nation admits that entitlement spending trajectory now and in the future is unsustainable.  But you can see below, that's it's not only entitlement spending that's out of control.  It's virtually every major budget category that is out of control!

There continues to be no adult in charge in Washington.  Obama is not, and never has been, up to the task of leading the nation, tackling any serious problem, nor negotiating with anybody.  Pro-growth policies are the only way out of our budget morass.

Mike Shedlock at Global Economic Analysis has done a great job at summarizing the latest decade of government spending increases.   We may have a temporary revenue problem due to the "great recession" of the past few years, but we have a worse spending problem.   Here's his accounting of spending by various government departments

Here's a handy table from his latest blog:  Congressional Spending Problem in Easy To Understand Format:

Department20002012 estimatePercentage Increase
Legislative Branch2,8715,25382.97
Judicial Branch4,0577,58186.86
Department of Agriculture75,071150,680100.72
Department of Commerce7,78811,32645.43
Department of Defense--Military Programs281,028688,254144.91
Department of Education33,47698,467194.14
Department of Energy14,97138,998160.49
Department of Health and Human Services382,311871,836128.04
Department of Homeland Security13,15960,443359.33
Department of Housing and Urban Development30,78156,78884.49
Department of the Interior7,99811,24140.55
Department of Justice16,84634,556105.13
Department of Labor31,873127,157298.95
Department of State6,68729,937347.69
Department of Transportation41,55584,135102.47
Department of the Treasury390,524579,61848.42
Department of Veterans Affairs47,044129,186174.61
Corps of Engineers--Civil Works4,2299,184117.17
Other Defense Civil Programs32,80151,99158.50
Environmental Protection Agency7,2239,35229.48
Executive Office of the President28341446.29
General Services Administration741,0831363.51
International Assistance Programs12,08725,554111.42
National Aeronautics and Space Administration13,42817,63731.34
National Science Foundation3,4488,281140.17
Office of Personnel Management48,65587,46279.76
Small Business Administration-4213,157
Social Security Administration (On-Budget)45,121188,552317.88
Social Security Administration (Off-Budget)396,169638,50961.17
Other Independent Agencies (On-Budget)8,80353,199504.33
Other Independent Agencies (Off-Budget)2,029-5,120
Allowances..........125
Undistributed Offsetting Receipts-173,019-279,28961.42
(On-budget)-105,586-151,06643.07
(Off-budget)-67,433-128,22390.15
Total outlays1,788,9503,795,547112.17

Mike summarizes the situation for Defense, Medicare and Medicaid:

Medicare 2000: 200,588
Medicare 2012: 480,202

Medicaid 2000: 117,744
Medicaid 2012: 283,597

Medicare spending is up 139%
Medicaid spending is up 140%


When you add up Homeland Security, Defense and Veteran's Affairs here's the tally:

2000 Total (281,028 + 13,159 + 47,044) = 341,231
2012 Total (688,254 + 60,443 + 129,186) = 877,883
Defense Spending Percentage Increased 157%

From Senator Rand Paul, (R, KY), says in a recent article regarding the fiscal cliff 'discussions',
Is it any wonder people are fed up with their government? The president announces we have no time for spending reforms, but when the deadline passes I predict not one committee will step into the breach to begin the process of reform.
Why? Because Democratic leadership still insists that Social Security and Medicare are just fine. Meanwhile, Social Security actuaries tell us that Social Security this year will spend $165 billion more than it receives. Medicare will spend $3 for every $1 it collects. Yet, the president says he doesn't have time for entitlement reform.
Rolling Back Federal Spending to 2008 Levels Balances Today's Budget

From the same article from Rand Paul,
Estimated revenue for 2013 is $2.9 trillion if the Bush tax cuts expire. Our 2012 revenues were $2.4 trillion, which included all of the Bush tax cut regime. The Bush tax cuts would only make a difference of $500 billion this year — about one third of our entire deficit — but would also further harm our economy due to the job market decline that always accompanies any rise in taxes. History has proved this point time and again.
But if we spent only at 2008 levels combined with the revenues of 2012, next year we would have a deficit as small as $89 billion. An $89 billion deficit would represent less than 1% of GDP. The 2012 deficit was as high as 7.3% of GDP.
Can it be any clearer??   Even a caveman could understand it.  Why aren't the politicians in Washington doing anything about the SPENDING problem??

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