Beyond the Cusp

July 27, 2011

What Exactly Do Politicians Mean by Spending Cuts?

We have the Debt Ceiling debate running hot and furious in the media, even if not in the halls of power where posturing is more important than actual work. We hear the demands that the debt ceiling, the upmost limit of outstanding loan debt the government is allowed to carry, be raised or else the government of the United States will be unable to pay its next installment on this same debt. The payment they refer to is approximately $213 billion, which is only 10% of the funds the United States Treasury predicts to collect in funds this year and is less than 1.5% of the debt and merely one half of one percent of the total budget. So, for a paltry sum of $213 billion which is a negligible piece of change when compared to total spending for the year, almost like leaving your pennies change in the charity box at the register, and the Federal Government is claiming to be on the verge of fiscal collapse. The President threatened to be unable to pay Social Security payments in order to make the payment due in the debt when they could take a few percentage points out of the actual payments for Social Security and have change left after paying on the debt. The threats of knocking the United States down a peg by lowering the credit rating one step if the debt ceiling is not raised and some spending cuts be planned does not happen in a timely manner. All of the talk begs a question, “Exactly what are these budget cuts which are being debated and threatened actually in comparison to current spending levels? How much less will the government be spending after these deep cuts are made?” The answers to these questions and the related subjects would be comical were they not so serious.

When our political representatives and the President and everybody else start talking about making cuts to spending, they do not mean making cuts in actual spending. Cutting spending in Governmentese (an Orwellian language that needs translating to have actual meaning in common English) actually denotes increasing spending, just at a more measured rate. Cutting spending actually is a call to increase spending, but to do it at a slower rate than the government had been planning to increase the spending. It does not even mean lowering the rate of spending solely to cover the cost of living increases and inflation. Spending will often remain well above cost of living and inflationary rates and still be considered a cut in spending. A good example comes from ancient history when President Reagan demanded spending cuts in the Department of Education spending and was accused of making such severe cuts in the education budget that school lunches would not survive the spending cuts. Yet, under the spending cuts recommended by President Reagan, the actual increase in education spending by seven percent and the school lunch programs by nine percent were called draconian cuts simply because they had brought the increased down from the previously planned increases for education of fourteen percent and the school lunch programs by twelve and one half percent. There was no actual cut in the funds, there were actually increases in spending, just not the proposed massive increases, just understandable increases within the government’s ability to make the payments with less debt accumulating.

So, when listening to the arguments and the accusations that some politician is making a huge cut in spending by some unbelievable percentage, the amount in the budget proposed by the guilty politician is heartlessly cutting is still going to be an increase. If the accuser is claiming the evil cost cutting plan will cause the end of the world, granny being thrown off a cliff, students going hungry, and a plethora of other evils all due to the proposed 25% spending cuts, do not simply accept such wild and exaggerated claims. What is happening is being made to sound like for every $100.00 that was budgeted would now be reduced to $75.00 with the aforementioned 25% cut. The truth is that the plan proposed was to increase every $100.00 up to $120.00 would now only be raised to $115.00. The 25% cut was to the $20.00 increase so instead of making a 20% increase, the proposal is to increase it only 15% which is a decrease in the rate of increase by 25%, but the spending is still being increased. Remember my old and favorite adage, when they quote dollars, they are attempting to make something sound expensive, they use percentage to minimize spending changes, and the last is that cuts simply mean less increase as government never decreases spending, never ever. So, when you really want to understand what is the real truth when politicians talk budgets, spending, cuts in spending, increases in spending, and amounts of spending, they are misleading you and speaking the truth in Governmentese, a way of clouding everything so it appears as they wish while hiding what it is. So, read and then investigate, you will be amazed. Then tell others the truths you find.

Beyond the Cusp

1 Comment »

  1. When politicians talk about amending Social Security…exactly which programs fall under that umbrella? It appears that Medicaid and Medicare are a separate government scheme, if you will. So, I’m wondering if unemployment compensation is included. I’m a bit confused because I didn’t think Social Security in and of itself was a government subsidized program; proceeds taken from taxpayers paychecks but nothing costing the government money. I am naive in thinking this so I want to clarify. Thank you

    Like

    Comment by Jon — August 1, 2011 @ 9:07 AM | Reply


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