Even the CBO Snubs Ryan’s Budget Plan

Bruce Krasting's picture


Congressman Ryan laid huge egg today with his budget. What's wrong with this guy? Can’t he count votes?

The proposal by Ryan is to end Obamacare. While there might be some merit to that notion – it ain’t going to happen. The Senate is controlled by the Democrats, and Obama would veto anything that came close to scrapping the cornerstone of his administration.

So don’t even bother to read the budget that the Republican’s have put up. It will not see the light of day. It was just a show pony for Ryan.

I went right to Ryan’s numbers for Social Security. How much of a reduction in benefit payments is he calling for over the coming decade? ZERO. ZIP. NADA. How to describe this obvious political dodge of responsibility: Gutless? Weak? Spineless? Chicken-hearted? Cowardly? Wimpy? How about pusillanimous (lack of courage)?

Ryan spent two of the 90 pages of crap on happy talk about Social Security. He wants to strengthen it. But he doesn’t say how, or even why. He even had the balls to quote FDR on SS. His proposal is to establish a “Presidential Commission”. Screw that idea; we did that three years ago. Nothing came from it.


The Ryan plan got the heave-ho from the Congressional Budget Office. I was amazed to see that the folks who are tasked to look at significant proposals basically said they were too busy.




The Republican jerks have squandered an opportunity to come up with anything that is even remotely feasible. Next up will be the Democratic version of Utopia. I suspect that the Senate version of a budget will be similarly out of touch with reality.


When will S&P say "enough-is-enough", and drop the US credit rating another notch? Given that there is no leadership at all, the folks at S&P must be thinking about how to respond. Last time it did not matter a damn that the rating was dropped. I don’t think the country will be so lucky the second time around.






I Wanna



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Mediocritas's picture

Bruce, This is an old book but the themes still hold true, please read it and then apply your unique skills to some fresh calculations:


I'd love to see your calculations regarding how much of an unecessary hole pharma is punching in the wallets of US citizens and hence putting more strain on SS, all the while failing to even deliver adequate health care.

Calculate what one, very simple legislative change could do for SS. That is to remove legislation that prohibits medicare from negotiating drug prices with companies. Locked out from a free market, medicare then ends up being forced to pay massively inflated prices (relative to every other nation in the OECD). That's gotta be a huge hit.

MSimon's picture

Spending bills originate in the House.

chasman's picture

Republicans are a matures. Period. Show all the graphs and charts you want. You lost and will continue to lose. you see, the American people are tooooooooooo stupid to grasp this economic stuff. they have been dumbed down by the libs. next time bring a gun to a gun fight not a knife.

MeBizarro's picture

Why do you continue to fixate on SSI when it is healthcare inflation and spending which is the root of the problem at every level of US govt?

Bruce almost always misses the forest through the trees in these conversations.

Ryan budget is pure trash because it magically assumes a 10-year period of uninterrupted growth with annual rates not seen since the US was industrializing in the late 19th century. Even a moderate recession blows his budget numbers completely out of the water with what would be at least a 7-8% GDP swing and likely higher.

Geruda's picture

Ryan is the people who is wearing a hat backwards when his is having lies in his speaking about how he is running faster than he can ever do.   It is not the speaking of brags about running that is making him a bad person to be leading.   It is the judgements it is showing that he is having that is making peoples know he is not a man who should be making important judgements that will be affecting other peoples.  Only a man who is having too many stupids would be telling lies that are so easy for peoples to know are lies he is speaking.  If peoples are going to be having leaders who are being liars they should at least be having clever liars, but not stupid liars.

Hohum's picture

Why does Ryan insist on tax breaks for the wealthiest?  If he believes in trickle down, he is a fool.

shovelhead's picture

Senate: "If we don't stop spending, we'll go blind..."

House: "How bout we spend until we need glasses?"


working class dog's picture

Ryan does whats right for Ryan and his family and to hell with everyone else, typical politics as usual. ban the FED and put money printing at zero interest rate cost to the people and all this waste will disappear along with the lobbyists and pork barrel.

Spaceman Spiff's picture

The Senate is controlled by the Democrats, and Obama would veto anything that came close to scrapping the cornerstone of his administration.


Well...  the other cornerstone is runaway deficits.  So how does any politician trying to be an adult make the needed cuts for a sane budget when 44 billion over 2 years was characterized as drastic by the administration and lower democrats?  any cut is a non-starter for passage.

Walt D.'s picture

The CBO are a bunch of buffoons. They should be subject to Sarbannes-Oxley. Otherwise, they need to be disbanded.

To balance the budget, even assuming spending is frozen (something that has zero chance of happening), the GDP would need to grow by $6 trillion (to cover a $1.2 trillion deficit).

In other worde the GDP needs to grow from $15.8 trillion to $21.8 trillion. Furthermore, this growth has to occur in the private sector.

This represents about a 3.5% growth per year for 10 years. Not impossible, but impossible with Obama's policies.

GM has $108 billion overseas. Why does it choose not to invest this in new businesses and products in the US? Obviously, they don't think that it is a good investment - the highest corporate taxes in the world and bonehead regulations.

Perhaps Obama is right. The Titanic has already hit the iceberg, the boat is going to sink, and there are not enough lifeboats. My as well go and sit down in the dining room, listen to the band, and enjoy the champagne and caviar.


Bicycle Repairman's picture

"I went right to Ryan’s numbers for Social Security. How much of a reduction in benefit payments is he calling for over the coming decade? ZERO. ZIP. NADA."

Well Mr Krasting, besides social security, how did you like the budget?  I think replacing Obamacare, with what? Romneycare? is laughable.

Paul Ryan (or Jebby Bush) is the GOP's future.  Enjoy.

Bennie Noakes's picture

How to describe this obvious political dodge of responsibility: Gutless? Weak? Spineless? Chicken-hearted? Cowardly? Wimpy? How about pusillanimous (lack of courage)?

How about "supercilious sophisticates," "vicars of vacillation," "pusillanimous pussyfooters", or "nattering nabobs of negativism"?

Spiro T may have been a scumball, but did come up with some memorable insults.

But I don't understand why Bruce feels that Repubs have to fix SS. The Dems are in power and SS is their invention. When President Bush proposed some fixes for SS a while back, Dems insisted that it wasn't broken and accused Repubs of trying to gut SS. So Repubs proposed some fixes and instead of coming up with counterproposals, Dems just made political points using scare tactics. If Repubs proposed more fixes, Dems (including Obama supporter Bruce K) would score more political points by denouncing those proposals as well. So now the ball is firmly in the Dems court. But last I heard, they were saying SS isn't broken.

Hey Bruce! You are a "hopeless, hysterical, hypochondriac of history".

Geruda's picture

Spiro was not coming up with good speaking.  It was the writer who was Safire he was having who put words into the mouth that was speaking.  Spiro was a very stupid people.

NoWayJose's picture

I do not know what Ryan was expecting, but the reception his budget got is the reason there is no budget or deficit reduction going on in DC. If anything, he did not go far enough, and we will not be able to have any budget cutting for the next 4 years.

rhinoblitzing's picture

In other words - Bullish..... and maybe what Paul Ryan is trying to say is.... Impeach Obama Now!

Roandavid's picture

This is not one of Bruce's better efforts.

Motorhead's picture

I agree.  Besides, he acts like nobody knows what pusillanimous means.  I don't think even Simon Black would ever do such a thing.

PMakoi's picture


Budget Plan

Tell every single department/agency head to cut their 2012 budget by 10%.  There will be no automatic increases.  There will be no cost of living adjustments, or any other exceptions to this edict.  Do it.

Okay, there's a start, and it takes all the politics out of budget cutting.  Next, scrap the IRS.  Institute a 25% flat income tax on every person, company, corporation, charity, EVERYONE!!  No exemptions, no deductions, no credits.  Income from any source, pay 25%.  Everyone could have a bar coded/magnetic stripe bank card, and all transactions could be near instantaneously recorded and balanced.  It would be hard to cheat.  It might eliminate lobbyists and PAC's, or at least reduce their influence.  And, we have the technology to do this.  Sure would be a long list of unemployed paper pushers, but maybe we could open some new businesses that actually produce real goods, and put them to work.

HoofHearted's picture

Come on, those of us who are really smart already have enough Mercury dimes to go a couple of years in this system without such a card. We have gold, silver, and small arms ammunition. I know you think this will work, but the underground economy always previals. Barter would immediately take over because your "credits" system is just asking to be used and will lead to arbitrage where people buy what is necessary or cheap and then barter it for other stuff. Never...gonna...work.

Name one (serious) country that has a flat tax rate above 20%. (Hint- there are four countries/protectorates that would fit the bill, excpt that none of us take any of them seriously.)

disabledvet's picture

"tell all current Department heads they have to do time in Afghanistan...or be replaced by someone who currently is" it is then...

Sun and Moon's picture

The Republican jerks have squandered an opportunity to come up with anything that is even remotely feasible. Next up will be the Democratic version of Utopia. I suspect that the Senate version of a budget will be similarly out of touch with reality.

The Democrats control the Presidency and the Senate. The best that could ever have been expected from the Republicans would be that they would come up with something that was very slightly less bad than what the Democrats wanted. And in fact, there is really very little difference between the two parties anyway.

I realize that there is no way that Obamacare is going to be repealed. Even if Republicans had swept Congress and the Presidency, it would only have meant minor, cosmetic changes to Obamacare. But I appreciate that there are a few people who are willing to at least speak against it.

Escapeclaws's picture

You are right, there is no way Obamacare will be repealed. The drug companies would not stand for it.

Walt D.'s picture

Nobody gives more  campaign money than the health care lobby. Most people think it is the banks and Wall Street (which,incidentally, no longer exists).

"Satan's greatist success was to convince people that he did not exist"

Panafrican Funktron Robot's picture

Bruce, interested in your thoughts regarding the petrodollar vis a vie the Kish Oil Bourse and Russian/Chinese central bank gold buying ramp-ups, and it's relevance to present geopolitical flareups that may "go wider" in a hurry.

I know you have pretty extensive knowledge/experience in forex, do you see the "currency war" getting "real"?

nofluer's picture

Inserting here... - Cold War Redux -

N Korea as a long time Soviet/Russian client State will start a proxy war with S Korea which will keep the US and China facing off while Russia picks up many marbles in the global retrenchment of power and money.

onlooker's picture

Bruce says------

“”I went right to Ryan’s numbers for Social Security. How much of a reduction in benefit payments is he calling for over the coming decade? ZERO. ZIP. NADA. How to describe this obvious political dodge of responsibility: Gutless? Weak? Spineless? Chicken-hearted? Cowardly? Wimpy? How about pusillanimous (lack of courage)?””


I say----------

I assume that you think Ryan should have reduced benefit payments in SS. Although the U.S. Government produces numbers that show cost stability, those who buy food, gas, home heating fuel, drugs, medical services, and most other goods and services, could disagree. It may be that a shadow deflationary cycle is upon us and is not widely known. However, as long as inflation is rampant and the printing press devalues our hard earned dollars, reduction of the SS payment in real purchasing power is not a viable way to shift the burden of a Government and Economy of Bankers that has gone way wrong.   

Escapeclaws's picture

Quelle surprise! Bruce wants to cut social security benefits. Even though he claims that he only wants to put SS on a sound financial basis, all his "reforms" (definition of reform: screwing the little guy) are aimed at reducing benefits for defenceless old people, who, by the way, are the solid majority of recipients. How often do we hear him wanting to claw back the $26 trillion that's been thrown at the banks? No, defenceless people are an easy target. Protest as he might, behind all the glib posturing lies mean-spiritedness.

nofluer's picture

As nominal taxes will be increased to cover REAL inflation, SS will only be "increased" to cover STATED inflation - net effect will be a radical DECREASE in SS benefits.

geno-econ's picture

Believe me when I say this is still a rich nation with a great deal of wealth created by middle class of current and past generations which can sustain the economy for at least another decade or two.  Unfortunatly the government and Fed knows where this money is stored and will manipulate for their benefit . For instance , if Money Market Funds were to lose deposit guarantee and one  dollar valuation , what would happen?  Trillions would flow into stock market creating another bubble and postpone the day of reckoning. In other words , forget about budget proposals, spending cuts or cuts in entitlements----expect more of Bruce's new Pussilanamous Economic Policy squeezing existing and old wealth out of the system.  It can also be called more of the Japanese Hari- Kari Economic Policy.  Perhaps it should be labelled as the Pusslanamous Hari-Kari Policy

Fedaykinx's picture

yup, there is still quite a lot of wealth in private hands that must be leeched, that's the only reason i don't think the wheels are going to come off anytime soon

MFLTucson's picture

To me, having the CBO snub the plan is a compliment given their pathetic track record.

q99x2's picture

When banksters move in and take over a nation from the top down this is how they do it. Washington D.C. is occupied by a foreign enemy that has the politicians working for them. Take appropriate precautions.

ebworthen's picture

Seniors vote, and are increasing in number.

Any politician that increases S.S. eligibility age or cuts benefits will be committing political suicide (and rightly so).

Real courage would be gutting the defense budget (bringing our troops home), eliminating Departments (Education, Labor, EPA), and ending the FED.

We are too far down the road for politics of any kind to solve this problem.

the grateful unemployed's picture

Ryans budget sounds like one of the few smart things the GOP has come up with (not saying his intentions are correct, honest or good, okay?) he should protect SSN, and the GOP would, and probably should trash Obamacare, because mandatory insurance is not healthcare reform. I expect them to repeal Obamacare, because it is pipe dream sold by a used car salesmen to a bunch of high school kids. It's not really law yet, and rests solely on consumer confidence that it is a good thing, and once that confidence cracks (Obama is way over on the hubris meter, and second terms are payback time, ask Clinton and Bush) once Obama gets caught talking to the same Taliban he claims are the enemy, to ratchet up the violence in order to keep the forever way going, or something equally likely, like supporting a strike on Iran, (even Bush turned that one down, and he had all the ducks in a row, but public opinion wasn't there) once it breaks then Bernanke, the economy and a whole lot of other things go along with it, and saving SSN, that will put the GOP back in the WH.

Go Tribe's picture

Yep. If you want SS to continue, you gotta cut Oscare.

kaiserhoff's picture

Why don't you draw up a balanced budget that will pass, Bruce?

Who's stopping you?

WTF_247's picture

SP will not downgrade US. They are already being sued for the first time by the justice dept.  It would take a massive issue to actually get them to do it - meaning they will be way, way late if and when it does happen.

Tombstone's picture

O'bummercare:  The cornerstone of fatal and final disaster.  Who is going to pay for all those free give-aways?  Jack the Taxpayer, if there are any left.

Herdee's picture

Ryan should phone Sarah for a date.They'd make a good pair of scumbags.

MFLTucson's picture

Except that you would be missing, to carry in a bag!

StarTedStackin''s picture

you should give Bawney Fwank a ring........

Captain Willard's picture

Dear Bruce -

Until the knuckleheads in DC come up against a binding constraint, this budget theater will continue. The Dem budget will be a fantasy of 4% GDP growth and 22% of GDP tax collection with no spending cuts necessary. It will be the yang to Ryan's yin.

Binding constraints force tectonic political movement - war, hyperinflation, depression, etc. When (not if) we get one of these binding constraints, the budget that will get passed will be an utterly pragmatic and desperate document. It will rival the Gettysburg Address for brevity.

Meanwhile, the theater of the absurd plays on.

machineh's picture

'It will rival the Gettysburg Address for brevity.'

Just seven words: 'All your FRNs are belong to us.'

disabledvet's picture

Actually the Civil War was a good time to go long the dollar. I find QE strikingly similar to what the banks had planned once US Grant became President...namely "400 billion to get the economy moving." he turned it down in favor of gold of course though Congress wouldn't go along with gold money until a Democrat from New York was elected 20 years later. Needless to say that didn't go over very well either...

Zer0head's picture
Even the CBO Snubs Ryan’s Budget Plan


Is one correct to infer from the above that you view the CBO as independent and bipartisan?


have you had a look at elfindwarfs CV?





DeadFred's picture

With great respect for ypu Bruce I have to ask, do YOU think there's any way out of this? For the the life of me I see no way out but the reset button. You can hope for unicorns like "If the republicans grew a spine" or "If the democrats realize entitlements need to be strongly adjusted" but they are just fantasy hypotheticals. They can read the writing on the wall and know that talking points is the best they can hope for. Go ahead, I'd love to be convinced there's real hope.