CBO Cuts Forecast Of Cumulative 2012-2021 Deficit By 50%, Admits It Is Probably Dead Wrong

Tyler Durden's picture

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baby_BLYTHE's picture

we would have to achieve near double-digit growth in private demand for their projections to come true. No way in hell that will happen

Tortfeasor's picture

$1.29 trillion budget deficit is 8% of a $16 trillion GDP.  So without borrowing money we're in contraction.

CrashisOptimistic's picture

Hey, wait a minute!

Where did that 27 billion dollar REDUCTION in FY2012 (election year) discretionary spending come from?

Are they serious?  Obama is going to sign off on slashing 27 billion October to October?

CrashisOptimistic's picture

Wait a minute, rev 2.0!

Look at the Super Duper Committee's legislative changes.

$111B  $111B  $111B  $111B  .........

They have them chopping 111Billion per year EVERY year for 9 years.

hahahahahahahahah

ElvisDog's picture

Where do you get $16T? 2011 GDP is closer to $14T. It is correct that the 12% deficit adds directly to GDP, so any cut to the deficit subtracts directly from GDP.

smlbizman's picture

question...i was under the immpression that the cbo just calculated others data...is this a wrong assumption?

trav7777's picture

yeah...the 10 year projection is forecasting deficits, what...1/3 of what they are now?  How in the fk is this gonna happen?

And the revised case is $350B/yr?  GTFO here with that BS, CBO

hambone's picture

DO NOT QUESTION THE GREAT AND ALL KNOWING WIZARD...NEVER MIND THE MAN BEHIND THE CURTAIN...we will click our shoes tegether 3x's and say there's no place like fantasyland and voila.  Suprised they didn't wrap it up w/ budget surplus.

LookingWithAmazement's picture

I'm bored again. Even the deficits don't scare anymore. Boring world we live in.

hugovanderbubble's picture

Barclays RISK OFF

http://www.rankia.com/respuestas/907633/fotos/52377

 

Sell UK BANKS Urgently...

UK to be downgraded

 

Societe Generale CDS hits new record.

LookingWithAmazement's picture

Much ado about nothing. Remember that recent Fed 1.2 trillion to the banks? We survived, even unnoticed until recently. Boring world we live in.

slaughterer's picture

CBO to the rescue! super-committee work? "piece of cake, Gordon."

Cognitive Dissonance's picture

In other words, if there is no tax-hike, everything the CBO has forecast is absolutely, dead wrong.

When I was a young(er) man everything was different. Sad really. When are we going to bury the corpse and have the Irish wake? Is it still bring your own bottle?

I'll bring three just in case.

alexwest's picture

thank you tyler

 

alx

oogs66's picture

the lies are getting too big to swallow and more people are questioning how bad it really is if they feel the need to lie so much!

kridkrid's picture

That's typical of all Ponzi schemes.  The lie starts out small... and possibly with the intention of not always being a lie (i.e. if we can actually create some spectacular returns, some way or another, maybe we don't actually have to be lying).  But compounding interest has a way of sneaking up on people.  The thing about this one... people really want like hell to believe the lie.  They will search for any positive news to support their normalcy bias or tune out completely (also to support their normalcy bias).  We live in an echo chamber of truth on this board, but reflect a remarkably tiny percentage of people.  We live in a collective illusion.

NOTaREALmerican's picture

Re: We live in an echo chamber of truth on this board, but reflect a remarkably tiny percentage of people.

 

But, what if the human society requires a Ponzi?   The clueless peasants and the predator nobility being always present in some form.   The US has been a Ponzi for the last 50+ years.   Big-Mic, Big-Ag, Big-Road, Big-Water, Big-Airport, Big-Ed, Big-House, Big-FIRE, Big-AntiDrug, Big-PoliceState, and (coming soon) Big-AntiSpaceAlienDefenseProgram, all centrally-planned scams that (as you said, might have started with "good intentions") but ended up being socialism for the politically connected (the nobility).

If the Ponzi is the truth for most people, "we" might be wrong.      The USSR lasted for 70+ years,  surely we can do better than THAT (we've got better predator birds and a cooler flag, after all).

 

 

NotApplicable's picture

I'd say human society requires that good ole eternal vigilance. Ponzi's and other herd scams are the price we pay when this lesson is temporarily forgotten, which, IMO is wholly due to government school systems intentional destruction of critical thinking skills in order to instill loyalty and compliance to their authority.

kridkrid's picture

I don't know if it is required.... but I suppose I might call it inevitable, if I were feeling particularly nihilistic, which I tend towards.

buzzsaw99's picture

The CBO has been compromised. They had a semblance independence and integrity for awhile but Owebama corrupted them along with everything else. The CBO is just another political hack now.

Nascent_Variable's picture

The Coniving Bullshit Office strikes again.  Time for Obama to call a press conference and announce that his stimulus plan cut the deficit by $3 trillion.

kridkrid's picture

I think you said the same thing about NPR yesterday (if it wasn't you, forgive me).  I was going to comment yesterday that this has been going on for far longer than people want to give credit.  This isn't a creation of the Obama administration any more than deceit was invented by the Bush administration.  Do people really believe that the ruling elite would allow the system that they created to be corrupted by the whims of the electorate?  We have had a monolithic monetary policy and monolithic foreign policy since as far back as JFK, perhaps further. 

http://www.youtube.com/watch?v=QeYgLLahHv8 - give this a listen... IMO... this has run unopposed since JFK was taken out.

tarsubil's picture

I'm starting to prefer the far more terrifying Alan Moore explanation, "the world is rudderless."

kridkrid's picture

Like most things, I would bet that things fall somewhere in the middle.  I mean obviously entities conspire to control resources and subjugate people.  Less obviously, but I believe quite clearly, much of this is done in a way that it allows it to remain undetected to most.  For example, the false choice that is provided in our two party system creates an illusion of choice, of freedom, of a voice.  But perhaps the world remains rudderless as competing conspiracies battle for control, or as they lose their control over the primary points of indoctrination.  Who knows. May you live in interesting times.

MacGruber's picture

The CBO has always been the caged stepchild of every administration.

naomix's picture

CBO in this analysis is assuming expiration of ALL Bush tax cuts, i.e. tax raises on everyone, not just the wealthy

ElvisDog's picture

That's a good point. People get all lathered up about the "Bush tax cuts for the wealthy", but if the Bush tax cuts go away, the working poor lose their 10% tax bracket. Their taxes go up.

naomix's picture

Tax raises on the rich generate $800bn over 10 years, tax raises on everyone generate $3.1tn: http://en.wikipedia.org/wiki/United_States_federal_budget#Debates_about_...

  • Making the tax cuts permanent for all taxpayers, regardless of income, would increase the national debt $3.1 trillion over the next 10 years.
  • Limiting the extension to individuals making less than $200,000 and married couples earning less than $250,000 would increase the debt about $2.3 trillion in the next decade.

 

EscapeKey's picture

"we really have no idea, so here are some numbers which we saw scribbled on the bathroom wall"

slewie the pi-rat's picture

hey, E_K!

"..whatever Lola wants...,...Lola gets..."

where "lola" = "supercongo" ?????

just (L0L)- a thought...

the federal budget is so outa control (except for the various mobs who get to milk it)  and the books are so outa balance,  that the CBO can't figure this shit out anymore, either!

maybe biden et al ordered this platter 0'patter for their chinese friends;  who knows?

DefiantSurf's picture

Obama to Gietner : first we need Moody's to downgrade Japan, next we need the CBO to make our forecast better than skittle shitting unicorns, then Friday have Bernanke unleash $2t for QE3, saturday we'll have another call with the new S&P CEO we installed, and ask him how he likes the new yacht we bought him?

its just getting embarrassing now....

centerline's picture

Truth being stranger than fiction. Yup. The spin control is simply amazing lately. Money still talks, for now.

Miss Expectations's picture

If only Zero Hedge could merge with TMZ, we could get photos of said CEO's yachts (and mansions, jets, private islands, mistresses....)

DormRoom's picture

When the CBO published their 2001 report of -2T indebtness by 2011, it gave the NeoCons the wherewithall to implement the project for the New American Century.  Their thinking was that US would have a surplus, so why not use it to police the world, and expand the american empire.

 

Ten years, and 2 wars later, the US is broke, because of the CBO false projections, and the misallocation of treasuries.

r101958's picture

I think the reason for this change was the sudden invitation, to the head of CBO, to attend the Bahama's retirement farewell cruise party for the CEO of S&P.

Paul Bogdanich's picture

"even the CBO admits it will most likely be horribly wrong."

Your criticism of the CBO is misplaced.  They are forced to calculate the "baseline" projections IAW what congress mandates.  When they adjust for unrealistic assumptions mandated by congress they give fairly accurate numbers.  Also they do adjust these numbers to take out the political adjustments they just delay that report for a qurter or so and in the interin admit right up front that the current report with the political adjuetments included is unreliable.  In short the probelm is not the CBO it's the congress so you could at least place the blame where it properly belongs or hire someone to write this drivel that is over 30 and a little drier behind the ears..   

 

pods's picture

So if you knowingly spread disinformation it is not YOUR fault?

This is the ministry of economic truth we have here.

I must have missed the news report about the brownshirts coming at 2 am to take innocent economists from their bed and forcing them to work for the ministry of economic truth.  Sorry, the "just doing our job" defense has long grown old and weary.

pods

sudzee's picture

Blame game. Its always somebody else's problem. Big circle jerk of non-responsibilty. I'm firing all of you as of today. You got 4 hours to get that into a replacement CBO report.

ElvisDog's picture

The problem is, Mr Bold Face Type, that the CBO assumptions appear to be based on the premise that nothing will affect anything else. For example, they claim that the deficit will be reduced to $500B in 2014 while at the same time maintaining 3.6% real GDP growth. How in the world does that happen? Deficit spending adds directly to GDP. You cut Govt spending (or take from the private sector by way of increased taxes) 8% of GDP to get to that $500B, then private sector GDP has to expand by that same 8% to make up the difference. According to the CBO, those two items can happily coexist. In the real world, it doesn't work that way. If my take home declines due to increased taxation, my economic activity declines as well.

SRV - ES339's picture

Sorry, but I don't see the evil in revising the projections after the debt ceiling agreement... what should they have done, increase the number after congress made committments to reduce????

At this point, arguing over a Trillion or so, over 10 years, seems futile, petty, misguided... and boring,

Mr Creosote's picture

Look at the change in discretionary spending. Are they effin' serious? 

alien-IQ's picture

Seems like they are now desperately trying to keep the machine running for a bit longer...

Which brings us to the First Rule of Zombieland: Cardio.

Larry Darrell's picture

Cardio, while extremely important, is not the first option.

Unlike the movie zombies, those coming to the USSA do go down with well placed bullets.

You only need to run after you run out of ammo.

Dr. Engali's picture

It will never happen as we will have more takers than producers. We will have more wars and higher unemployment. Trillion + dollar deficits are the new normal.

TruthInSunshine's picture

 

 

Yet another data point lie by our wholly corrupt and/or grossly incompetent government (take your pick, or assume some of each).

Jobs, confidence in institutions (government, media, etc.), standard of living...

The real jobless rate is close to 17%, and when including the underemployed, it surges closer to 22% (U6).

The real rate of inflation is closing in on 10%.

The real U.S. debt, if one includes future entitlement guarantees, is between 60 trillion (if one takes David M. Walker's estimates) and 200 trillion (if one accepts Laurence Kotlikoff's estimates).

Americans are losing confidence in their political leaders, captains of industry, government agencies (i.e. regulatory and statistical reporting agencies - hello SEC and BLS) and the "investment and financial markets" at the fastest rate since the 1930s.

Americans have seen their standard of living decimated, almost across all income distributions, as anything owned by them that falls in the "big ticket" categories (that credit is required to purchase, such as their homes) have gotten decapitated and are falling still, as their "financial portfolios" not only get crushed in real terms but also in NOMINAL terms (there are 25 year buy and hold bagholders who are now sitting with losses due to the incredibly rigged casino that is Wall Street and sell-side finance), and Bernanke & Geithner/Paulson helped to kick them in the balls further, as Treasury & The Federal Reserve undertook policies (TARP, TALF, QE) that provided false floors for price discovery on assets (at heavy taxpayer expense) and stoked heavy real inflation (at heavy consumer expense, working as a tax on consumption - Bernank's paradoxical boomerang lined with a razor blade).

The rise of the alternate media has embarrassed the Main Stream Media and exposed them as the proxy of government and the corpocracy that they have devolved into, and given the masses access to far more accurate information, while beginning the process by which the whole Ponzi Scheme that is fractional reserve banking, deep capture of government by the military-industrial-financial-corporate complex is exposed in plain day light.

A Ponzi scheme relies on CONFIDENCE.

When the history books are written on this chapter of the human experience, it should be titled CONfidence Lost.

Many of these same things can be said of European Nations and the relationship of their citizenry with their institutions.

It's all coming apart for the gatekeepers.

PulauHantu29's picture

It should be rather obvious that many communities in California are still in mega-bubbles.  Old habits are hard to change and we have a large group of people force fed on the bubble decade real estate religion that somehow, their niche market is blessed with certain inalienable rights that give it an advantage.

 

So who were the Bubble Buyers?

 

http://www.doctorhousingbubble.com/wp-content/uploads/2011/08/year-house...

http://www.doctorhousingbubble.com/calabasas-real-estate-median-home-pri...

 

 

Balmyone's picture

Lower deficit projections opens the door for more presidential largesse.  Who wants to bet that Obama is going to make a whopper of a fiscal stimulus push to ensure his re-election.

ElvisDog's picture

And....? Will the Republican-controlled House pass Obama's stimulus push? I think not. It won't even get out of committee.

tarsubil's picture

Oh, there will be some emergency. They'll have no other choice. You got to believe them. They care about you.