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Preparing For Obama's 2015 Budget With A Chart And A Toy
Submitted by F.F.Wiley via Cyniconomics blog,
The goal that was identified by Simpson-Bowles was to reduce the deficit as a percentage of GDP to below 3%, but what our budget projection shows is that over the course of the next ten years (or in ten years) the percentage will actually be below 2%. So we’ve made substantial progress in reducing the deficit.
- White House deputy press secretary Josh Earnest, offering a preview of Obama’s 2015 budget proposal to be unveiled tomorrow
There’s so much wrong with that statement that we won’t even bother to correct it. Nor do we plan to pick through the budget proposal to see just how they cooked the books to show a deficit below 2% of GDP in 2024.
No one really believes the numbers anyway, right?
Rather than analyzing projections that we already know are defective, we’ll try to counter the propaganda with an updated version of “The Chart That Every Taxpayer Deserves To See.”
If you missed our earlier version, we start with budget projections from the Congressional Budget Office, and then we make a series of adjustments to bring them into the real world.
There are two reasons to pick on CBO projections (even as we leave the White House’s numbers alone):
- Their faults are less obvious but just as fatal as the flaws in White House projections.
- Despite those fatal flaws, they’re widely broadcast and rarely questioned by either the mainstream media or mainstream economists.
Moreover, the media normally shows both White House and CBO budget projections in proportion to GDP, which is standard but isn’t always the best way to think about it. GDP percentages are too abstract – you can’t hold them in your hand and look at them. You can hold dollars, though, and that’s where the chart below comes in.
Using the CBO budget outlook released in February, we updated our estimates for how many dollars we’ll need to offset the national debt, on a per-taxpayer basis:
As shown, each taxpayer’s share of the debt will soon clear $150,000 on its way to over $200,000 in eight years time. These numbers are adjusted for the CBO’s inflation projections, so that $200,000 in 2022 has the same value as $200,000 today. Worse still, the figure grows faster and faster the further out you look, as we showed after the CBO published its long-term outlook last September.
Needless to say, our public finances are a mess, notwithstanding the misinformation you’ll hear tomorrow.
When President Obama rolls out his proposed budget, you’ll hear boasts about improvements in the deficit since the depths of the Great Recession. You’ll also hear claims that those improvements are easily sustained; that a much talked about “grand bargain” on long-term debt reduction can wait.
But once you see through the phony numbers in government projections, it’s clear that we’re on a path from a stupidly high debt burden to a much higher burden. Washington would need to find some leadership and foresight to change that path, and there’s no sign of that happening anytime soon.
What are those faint, dotted lines for?
The first time we published “The Chart That Every Taxpayer Deserves To See,” we went all activist and included a draft letter to your congressional rep.
This time, we overlaid some dotted lines showing where you can fold the chart to make a killer paper airplane. Your kids may not want to think about the grim message just yet, but they can at least hurl it around the living room and get familiar with it. It’ll be a big part of their future.
What’s more, by turning your debt bill into a cheap toy, you can show the same level of seriousness about fiscal risks that you find in your elected officials.
Methodology
Our projections are based entirely on data found in CBO and other government reports, but put together in a more honest and sensible way. See either of these recent articles for more detail:
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Yes, we would like a toy with that.
I feel a late day pump and dump coming..
That's just the heroin talking.
You can't fix stupid!
It does seem to be an incurable disease.
People still don't understand this shit? Here, learn something:
http://upload.wikimedia.org/wikipedia/commons/8/8b/UK_GDP.png
I don't need no stinking graph - I understand what is going on.
I don't need no stinking graph - I understand what is going on.
So you understand that debt to gdp means nothing as long as you are the dominant military power?
You do realize that is a graph of the UK GDP
Dateline 2024, Washington, DC. President Hillary Clinton, in her final State of the Union address said "It is time we finally get serious about our country's debt. The United States can no longer afford to have a Debt-to-GDP ratio of 500%."
She propsed cutting the yearly deficit to half it's current 8% level in numerous ways, "bending the cost curve" by phasing the cuts in gradually starting in 2028. None of these proposed changes would affect any government entitlement programs in any significant ways.
On Wall St., reaction was muted with the 10 Year Treasury Bond rate rising from 0.32% to 0.34% and the Dow rising 300 points to close at 37,802.
OBLIGATORY
*******
"The fact that we are here today to debate raising America’s debt limit is a sign of leadership failure. It is a sign that the U.S. Government can’t pay its own bills. It is a sign that we now depend on ongoing financial assistance from foreign countries to finance our Government’s reckless fiscal policies."
"Over the past 5 years, our federal debt has increased by $3.5 trillion to $8.6 trillion.That is “trillion” with a “T.” That is money that we have borrowed from the Social Security trust fund, borrowed from China and Japan, borrowed from American taxpayers. And over the next 5 years, between now and 2011, the President’s budget will increase the debt by almost another $3.5 trillion."
"Numbers that large are sometimes hard to understand. Some people may wonder why they matter. Here is why: This year, the Federal Government will spend $220 billion on interest. That is more money to pay interest on our national debt than we’ll spend on Medicaid and the State Children’s Health Insurance Program. That is more money to pay interest on our debt this year than we will spend on education, homeland security, transportation, and veterans benefits combined. It is more money in one year than we are likely to spend to rebuild the devastated gulf coast in a way that honors the best of America."
"And the cost of our debt is one of the fastest growing expenses in the Federal budget. This rising debt is a hidden domestic enemy, robbing our cities and States of critical investments in infrastructure like bridges, ports, and levees; robbing our families and our children of critical investments in education and health care reform; robbing our seniors of the retirement and health security they have counted on."
"Every dollar we pay in interest is a dollar that is not going to investment in America’s priorities."
Senator Barack Obama (D-IL)
VOTING AGAINST RAISING THE DEBT CEILING
March 16, 2006
Official National Debt at that time: 8.6 trillion USD
Official National Debt NOW: 17.2 trillion USD & rising fast
FORWARD!!!
harsh but true.
The government is at the point where it is not just raping its current citizens (while asking us to smile) it has made reservations to rape our as yet to be born children's children.
We saw the pump...now its time for the dump.
Im just feeling a late day dump.
All that matters is that the top 20% keep doing well.
Except for the fact that they are busy strip-mining 19.9% of the top 20%.
If you don't have a lobbyist on K Street looking out for you, you will get fucked. And heck, even if you DO have a lobbyist, it's 50-50 you are gonna get fucked.
Well, ya just gotta make sure your house isn't on the edge of the strip mine.
In our glorious survival-of-the-fittest society, there will be winners and lazy-losers who just leach off the winners and take their hard-earned tax money.
Making up data, one bastardization of statistics at a time
And WW3 spending isn't even factored in!
dude there is no reason to be so pessimistic.
The recovery is coming soon™
https://www.youtube.com/watch?v=0WXhO_-e3bM
BTW, I have family in Poland near the border with Kaliningrad... and the Ruskies are doing drill right on the border with Poland... no wonder Poland has asked for an urgent nato meeting tomorrow under article 4...
Re: urgent nato meeting
A few weeks ago, many on this site were praising Putin and his manly outlook on politics and economics.
The mood was that Obama has weakened Merica's resolve to act manly.
Perhaps Poland would be better off with the manly Ruskies than the girly-men who run Merica and Yerp.
Two words: Katyn Forest.
The Poles would not be the same pushover they were in WWII
Re: The Poles would not be the same pushover they were in WWII
Depends how many were in Starbucks checking their text messages, I guess.
Time to warm up the Finnish snipers...
Its simple, pass a law that any govt employ that lies has his hand cut off
Why? They'll just ignore it.
That would result in most government employees with no hands and the hiring of a government employed helper for each of these handless impaired, handless helpers if you will, doubling the number of government employees.
A tragedy, to be sure, and it's virtually guaranteed that someone would defend the handless by saying, "They're not looking for a handout, they just need a hand."
But at least we wouldn't have government economists say, "But on the other hand..."
the horror. the horror.
wheres todays usd/jpy is the weather affecting k-hen
EVERYTHING IS AWESOME!!!!!!!!!!!!!! http://www.youtube.com/watch?v=StTqXEQ2l-Y
budgets pure BS - simply ludicrous assumptioms requiring ever more debt to pay ever more debt.
more importantly...
In '13, ETF outflows satiated the ever larger physical demand for gold from a finite and shrinking pool of available physical bullion (ETF outflows met about 20% of ’13 demand or 900 tons of 4500 total demand).
Since GLD is the largest and pretty representative of the 900 ton total ETF ’13 drawdown, it’s a good proxy. GLD was @ a 1350 ton peak allocation to about 790 minimum in ’13 (800 @ present). This represents 560 tons or 41.5% of it’s total holdings sold (looted) in ’13. Gold prices fell $1750 to $1250 or 30% to achieve this drawdown.
Demand thus far is higher in ’14 but to maintain the supply from the GLD again in ’14 an additional drop in price from current $1350 to roughly $950 (another 30%) would net an additional 40% GLD drawdown…netting only 320 tons of “new supply” from GLD or 240 tons less than in ’13.
Quickly one can see that @ these lower prices demand will likely get stronger, supply from mining and scrap (the other 80% of supply) will begin falling even faster (particularly coupled w/ rising energy costs)…more than offsetting any ETF outflows.
The only answers left are higher prices, or nationalization of mines to force higher production regardless of profit, or confiscation / limitations / taxations to cut demand, or CB’s or some other source dump their phyz to augment the supply to meet the higher demands.
The game as we saw in ’13 (w/ ETF outflows) was a one time deal that simply cannot be repeated. What now??? Everybody place your bets cause the river card is bout to be played.
Zero better get a move on. He is running out of time to "fundamentally change America".
Given how much destruction he's wrought in the last 5 years, how much more could he possibly do in the 3 he has left? On second thought, don't answer that.
Obama and his budget? There is no budget for him in his world until he reads it from the telepromter.
But he knows very well that from this budget there will come millions for him in the coming years, Clintons told him.
Owe Blah Blah ain't no Bill Clinton.
Bill Clinton's a twat.
Obama's a cunt...
so yes...yes they are both vaginas
What would happen if we all just said "No." to their fiat dollars, and Washingtonian debt?
Can we all exchange our Federal Reserve Debt Notes for Canadian dollars or some equivalent, and do business with that?
This must be a racist graph.
People like their lies. We lie to each other everyday. Lies, even small lies, harm all. When will first Gay marry his/her sibling? To be fair, opposite genders will demand equality. Male and females are equal om all dimensions. President Obama is the smartest President ever. Lies harm.
I guess since we have to keep paying for the largest military in the world, hidden covert operations, wonderful organizations like the NSA and their huge data collection centers, and Congressional salaries, the only thing we can possibly do is eliminate entitlement programs. We certainly couldn't require the wealthy to pay more, or close down tax havens. That might cost a job or two!
DC US' budget: Extract a much as possible by hook and crook. Piss away all of that and as much as can be stolen from the future.
That chart has a major error: It has the DC US still existing in 2020.
The Queen says no to tanks. We apparently have no money for any more tanks.
So 19th century. Oh wait.
He delivers the budget tomorrow ..but he is already asking for money that is not in his budget to bail out the Ukraine....and I am sure he shows a balanced budget before he leaves office...and the CBO will back him up....even the people on welfare are going to sign up for the gold Obamacare plans and pay for it...on their own because its such a great deal...lol..everyone get your vomit bags close tomorrow
Obama - budget.......what a crock of shit.
The fucker probably never even looked at this steaming pile of shit.
I was sure the toy was going to be a 12" dildo with instructions for anal ream-age.
Barry would deliver the budget today, but he's too busy carrying water for Putin.
"You’ll also hear claims that those improvements are easily sustained; that a much talked about “grand bargain” on long-term debt reduction can wait."
Math always says otherwise.
Hairy DickReid has already said the Senate won't be passing no steenking budget in 2014, so why is Oblamo botherng with the charade ?
It's the job of Congress to come up with a budget. No Presidential budget has Ever been adopted by Congress and I wonder who the first President was to even submit one with his name on it. Stupid fucker.
Going back to 1980 "our debt has doubled every 8 years give or take. That's what we know of. With 10,000 people turning 65 everyday for the next 13 or so years by the time 2024 rolls around if a debt jubilee has not happened I would guess "our" debt that we know of will be around 35-38 trillion dollars.