BCT Editorial – 2/9/07

This page was last updated on February 11, 2007.

Debate over federal budget doesn’t address sacrifices that need to be made; Editorial; Beaver County Times; February 9, 2007.

Below is a detailed critique of the subject editorial.

“In a way, you have to admire Treasury Secretary Henry Paulson. It takes real self-control to keep a straight face while telling a whopper like the one he did on Tuesday regarding President Bush’s new $2.9 trillion spending plan.

“Appearing before the House Ways and Means Committee, Paulson said, ‘We are submitting a budget that includes a surplus in 2012, which is achievable if we keep our economy growing.’

“Needless to say, Democrats disputed Snow’s rosy scenario, claiming the budget achieves its projected $61 billion surplus in 2012 by adopting overly optimistic economic assumptions.

“Naturally, Snow disputed their contention. He claimed ‘our economic assumptions are close to the consensus of professional forecasters.’

“Here’s the dirty little secret: It doesn’t matter whether the federal government’s budget in 2012 has a surplus or not. That’s because anyone can manipulate short-term projections. However, if you look 10, 15 and 20 years down the road and beyond, the budget fantasy dissolves into an outright fiscal catastrophe.”

[RWC] I can’t assess the projections used in the new budget, but I can look at history. In case you missed it, actual tax revenue figures are constantly being revised upward from their projections and the deficit is dropping faster than projected. Unless the Administration changed its methods for budget projections, it has a history of being conservative.

“[A]nyone can manipulate short-term projections?” Did you notice no one seems to mention this when they claim President Bush inherited a budget surplus?

“White House budget director Rob Portman pretty much admitted that. The Associated Press reported he told the House Budget Committee that while the administration’s budget projects balance in the short term, shortfalls in Social Security and Medicare promise to swamp taxpayers in the long term.”

[RWC] “[A]dmitted that?” I didn’t know it was a secret. Name a Ponzi scheme that didn’t happen to.

“In addition to Medicare and Social Security, Medicaid costs are going to keep increasing.

“On the revenue side, fixing the alternative minimum tax, a levy once aimed at making sure the rich paid some income taxes but is now trapping more and more middle-class Americans, would mean $1 trillion in lost federal revenue over the next 10 years.

“If Bush’s tax cuts are extended over the next decade, another $1.6 trillion in revenue will disappear.”

[RWC] When will these guys quit referring to “lost federal revenue?” Government doesn’t own any revenue to lose.

Also, it’s incorrect to refer to “Bush’s tax cuts.” President Bush and Congress didn’t cut taxes; they cut tax rates. As a result, the economy has been growing and tax revenue has actually increased, not decreased. That’s why the deficit is going down. The deficit isn’t going down because we’re spending less. It’s going down because we’re collecting more taxes. That’s not a tax cut in my book.

“A budget crisis is coming, and it’s one that our nation cannot grow its way out of. The problems are built into the budget process, and the only way to address them is to make across-the-board sacrifices at all levels. That means some combination of tax hikes and spending cuts (including Social Security, Medicare and Medicaid).

“But instead of leveling with the American people about the seriousness of the situation, Republicans posture on taxes and Democrats demagogue on entitlements. That’s no laughing matter.”

[RWC] You have to give the Times credit for chutzpah. At the same time it talks about “across-the-board sacrifices at all levels” and “spending cuts (including Social Security, Medicare and Medicaid),” in other Times editorials lobby for a taxpayer funded national healthcare system, more subsidies for bus riders, more spending on education, and on and on.

The Times is consistent on one topic, though. There’s always room for more taxes.