Devious debt and deficit double-talk

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Column by Jim Flynn

The difficulty among the House, Senate, and president in reaching a debt and deficit agreement for the coming fiscal year was that they were discussing fictional numbers as if they were real.
For decades federal budgeting and spending has been designed to obscure the ambitions and intentions of Washington politicians and bureaucrats. It’s called baseline budgeting. The object is to give the impression that legislators are providing more services without voting for more spending.
Congress and the White House use the high-sounding hocus-pocus of baseline budgeting to explain the taxing, spending, and borrowing process. Baseline budgeting begins with a conviction that every federal dollar spent last year must have been essential to the health and welfare of the nation — a very dubious assumption.
A standard practice of all government bureaucracies is to spend every dollar of each year’s budget, necessary or not, out of fear that next year’s appropriation may be decreased. End-of-the-year spending sprees are common. Reporting a surplus is considered downright dumb.
Any suggestion that the federal budget for the coming year should be frozen at last year’s spending level will be considered cutting next year’s budget by billions of dollars, a lazy conclusion without investigation.
In the magic world of federal spending, The White House or Congress might consider whether a project or program should be increased by two billion dollars on top of the built-in automatic increases. In the interest of economy, and looking good with voters, they might cut the increase to one billion dollars. They would then congratulate themselves and tell voters they had just reduced spending by a billion dollars – total nonsense with a straight face.
It’s like going on a cruise expecting to gain 10 ten pounds, like the last trip we were on. Instead we gain only five pounds and then brag to friends and neighbors about losing five pounds.
In Washington talk baseline has no connection to income, expenses, or even the ability of the government to borrow. The baseline is what politicians and bureaucrats think it ought to be – a fiction treated as if it were fact. Congress and the White House regularly project long-term income which doesn’t happen and long-term spending which may or may not be necessary, but is always politically desirable.
Another factor in baseline budgeting are the increases caused by emergencies and new programs such as Obamacare, disasters, and stimulus spending. The baseline is like sticky paper. There is no such thing as one-time spending in Washington.
The U.S. government takes in about $2.4 trillion in revenues (taxes) each year and has been spending $3.7 trillion. A trillion is a thousand billions. With a limping economy it’s unlikely revenues (taxes) are going to increase over the foreseeable future. Baseline budgeting baloney isn’t going to change the limited alternatives of sane fiscal policy – less spending or more taxes. Borrowing $1.3 trillion a year is just putting off an inevitable day of disaster.