Obama Bans Gimmicks, and Deficit Will Rise

[roseBudd]

Source: New York Times

WASHINGTON — For his first annual budget next week, President Obama has banned four accounting gimmicks that President George W. Bush used to make deficit projections look smaller. The price of more honest bookkeeping: A budget that is $2.7 trillion deeper in the red over the next decade than it would otherwise appear, according to administration officials.

The new accounting involves spending on the wars in Iraq and Afghanistan, Medicare reimbursements to physicians and the cost of disaster responses.

But the biggest adjustment will deal with revenues from the alternative minimum tax, a parallel tax system enacted in 1969 to prevent the wealthy from using tax shelters to avoid paying any income tax.

Mr. Obama’s banishment of the gimmicks, which have been widely criticized, is in keeping with his promise to run a more transparent government.



Read more: http://www.nytimes.com/2009/02/20/us/politics/20budget.html

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This would make for fantastic Letters to the Editor!

[Idealism]

1. Few realize the Iraq War is completely outside of the national budget n/t

[karynnj]

8. I remember being shocked when I heard that

If it were not in a Kerry statement on the budget, I would have thought it was wrong - as it makes no sense. One reason given was that the amount was unknown - though in that case they still could have used an estimate more likely than $0.

[Demeter]

2. This is a good decision

I applaud this first step to TRUTH and Reconciliation of the data.

[cliffordu]

4. I like that - the "truth and Reconciliation of the data"

[bluestateguy]

3. "Reagan proved deficits don't matter"

--Dick Cheney

[santamargarita]

5. When the GOP counts your money, $1.00 + $1.00 = .50 when they count...

...their money $1.00 + $1.00 = $5.00

[roseBudd]

6. I just posted it to a right wing pundits blog on an MSM site....

I'll let you know if his head explodes.

I really set him off 2 days ago.

http://news.cincinnati.com/apps/pbcs.dll/section?Category=blog03&plckController=Blog&plckScript=blogScript&plckElementId=blogDest&plckBlogPage=BlogViewPost&plckPostId=Blog%3ab0f34581-34e4-4b11-9a69-1df5eb81e786Post%3a5531ce97-5c68-45ba-a5da-b66f6c990d66&sid=sitelife.cincinnati.com

[benld74]

7. But 1st redo the last 8 budgets using the same method and compare to what * said they were!

[BumRushDaShow]

9. Finally.

But sadly, the wingnuts will then find all sorts of ways to use this against him and the Democratic party to make it seem as if these "new" debts suddenly appeared under Obama.

[Psephos]

10. An excellent start. But the real legerdemain is the theft of incoming SS funds for general revenue.

The government unscrupulously uses cash accounting. Money paid in for Social Security goes into current spending. The IOUs the government writes itself do not show up on the current year budget, and are not reported as deficit. But those IOUs must be paid, and the day is not far off. If the government used the same GAAP (Generally Accepted Accounting Practices) system that corporations are required to use by law, which take into account future committed liabilities as well as present expenditures, then the true government deficit would be more like $5.1 trillion for 2008. Likely around $7 trillion for 2009. Total US indebtedness on accrual basis is currently about $50 trillion. That's more than the entire GDP of the whole planet. That's about five year's worth of every last cent the US generates all year long. Which would leave, obviously, nothing for anything else. No food. No power. No government. Nothing but a sucking vortex.

Today's troubles will seem like a brief rain shower when that mother of all storms comes rolling in. And yet, our triple-D government, which campaigned on pay-go and fiscal sanity, is now borrowing the most money any government has ever borrowed in human history as a way of fixing the problems caused by irresponsible and insane borrowing.

Utter, cynical madness.

[change_notfinetuning]

13. Your point about Social Security is spot on. I hope that

this isn't another case of the Obama people being on the right track, but stopping short of getting it totally right. The SS problem is huge, but if the Obama administration can't solve the big problems, then there is really no hope. I know they can't solve everything instantly, but as long as they are going this far, they should at least identify the full extent of our fiscal fiction.

[ccinamon]

11. could this be a first step in getting ready to raise the taxes on those

who make millions of dollars a year?

[digidigido]

12. has to be

[Skink]

14. So when Jeb takes office all he has to do is reinstate previous accounting methods?