Paul Ryan Throws Up All Over Reid $1 Trillion Budget Gimmick

Tyler Durden's picture

Earlier it was our turn to suffer a series of subdural hematomas courtesy of the $1 trillion in "savings" from wars yet unfought as per Harry Reid's plan "proposal." Now, it is Paul Ryan's turn.

A Trillion-Dollar Gimmick

July 25, 2011

 “Why, one wonders, not ‘save’ $5 trillion by proposing to spend that amount to cover the moon with yogurt and then cancelling the proposal?”

-George Will, Washington Post, March 12, 2009

Claim 1: “Winding down the wars in Iraq and Afghanistan will save $1 trillion.”

Reality: The Reid plan relies on the inaccurate assumption that surge-level spending in Iraq and Afghanistan is scheduled to continue over the next decade. An honest budget cannot claim to save taxpayers’ dollars by cutting spending that was not requested and will not be spent. Senate Democrats are employing a budget gimmick that will not fool the credit markets and does not address the urgent need for Washington to get its fiscal house in order.

Claim 2: “Paul Ryan’s budget also included this savings in its deficit reduction calculation.”

Reality: False. The House-passed budget cuts $6.2 trillion in spending relative to President Obama’s Fiscal Year 2012 budget request. This $6.2 trillion figure assumes ZERO savings from the global war on terror relative to the President’s budget.


The $2.7 trillion debt-limit increase proposal offered by Senate Majority Leader Harry Reid contains a $1 trillion gimmick meant to disguise the plan’s shallowness on spending cuts. Supporters of the Reid plan are measuring their savings against a baseline that assumes the continuation of surge-level spending in Iraq and Afghanistan, even though the President has neither requested this funding nor signaled that he might request it. Instead, the President has signaled the opposite: a troop drawdown over the next few years. In other words, the Reid plan is claiming credit for “savings” that were already scheduled to occur, and for “cutting” spending that no one has requested.

Rather than defend this gimmick on the merits, supporters of the Reid plan are defending it by claiming that House Republicans “also included” this $1 trillion in savings when calculating spending reductions in the budget resolution that passed the House last April. This claim is false. The House-passed budget cuts $6.2 trillion in spending relative to President Obama’s FY2012 budget request, and this spending reduction assumes ZERO savings from the global war on terror relative to the President’s budget.

In the interest of maximum transparency, House Republicans produced additional estimates in order to provide a broad range of comparisons by which outsiders could judge the seriousness of the their budget’s commitment to real spending cuts and controls.

For instance, Table S-4 of the House-passed budget provides two savings estimates. The first estimate compares the House-passed budget to the “current law” baseline used by the Congressional Budget Office [CBO], even though House Budget Committee Republicans have consistently noted that the CBO current-law baseline is not the most reasonable budget baseline with which to compare future-year budget plans. For example, the current-law baseline assumes a $3.5 trillion across-the-board tax increase in 2013, as well as a continuation of spending for the global war on terror at its current level for the rest of the decade, with upward adjustments for inflation. The CBO has noted that these policy outcomes are unlikely, which is why it has also constructed an “alternative fiscal scenario” baseline that assumes more realistic outcomes.

In order to provide a more relevant comparison, House Budget Committee Republicans provided a second estimate in Table S-4, comparing the House-passed budget to President Obama’s FY 2012 budget request. This comparison makes clear that, even with no savings attributed to the troop drawdown and with identical numbers to the President’s on the war on terror, the House-passed budget cuts spending by $6.2 trillion relative to the President’s request.

It’s one thing to include, as the House-passed budget does, information about savings relative to the CBO’s current-law baseline as part of an effort to be comprehensive and transparent. It’s another to claim, as supporters of the Reid plan are claiming, that such “savings” represent a major commitment to cutting spending. It simply isn’t true.

It is encouraging to see Senate Democrats acknowledge that job-destroying tax increases are a bad idea – and that they are ready to work with House Republicans to cut government spending. Yet it is critical for policymakers to maintain credibility as they work together to deal responsibly with the debt ceiling. Senator Reid’s misleading claims will not pass muster with credit markets. Such gimmickry does a disservice to the American people, who deserve responsible, honest leadership.

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oogs66's picture

though they have succeeded in convincing america they are 'saving money'   does anyone remember it is just reducing the deficit?  does anyone believe that future cuts will ever be enacted?

High Plains Drifter's picture

the dirty little secret is this. it is already over for us. almost everyone here at zerohedge knows this.  heck a blind man could see it...........

Sathington Willougby's picture


Yer right.  No more aid to any fucking losers.  That includes  ALL the shit for brains assholes in the middle east.  Currently we give more to Israels enemies than them but fuck em all. 

No more fucking foreign aid to anyone.  We would have beat Bin Laden by leaving that region and they could all hurl sticks and feces at each other until the end of time.

End militarism.

End war on everything, drugs, literacy, terror and anything else, nouns verbs inanimate objects what a contrivance.

The faster this sham of a life thieving govt ends, the better.  Debt ceiling to infinity, dollar to zero, empire collapse.  All the livestock fail when their welfare doesn't show up, wither and die.  Everyone else lives happily ever after as free thinking individuals.

MrSteve's picture

"ending the war on nouns and verbs" .... genius!  the adverbs and adjectives will hate you forever though...prepositions are indifferent, generally

Tuco Benedicto Pacifico Juan Maria Ramirez's picture

"That is something up with which I will not put."    --Winston Churchill


FEDbuster's picture

Interventions and tough love won't cut it.  Like all addicts, the United States (and the most of the western world) will have to hit rock bottom before we stop this madness.

"Hasten the Collapse, OBAMA 2012"

baby_BLYTHE's picture

it all screams ACCOUNTING GIMMICKS to me.

Someone call up Rumsfeld and ask where that 2.3 trillion went

Coyote57's picture

Mr. Willooughby:

"We would have beat Bin Laden by leaving that region and they could all hurl sticks and feces at each other until the end of time."

I think you are overlooking the fact that, 'that region' contains all the oil we need to run our economy.

That region can do anything they want to us and we must take it because we are slaves to their oil pure and simple.

You will have to come up with an alternate plan

Captain Kurtz's picture

indeed, hence why we establish non-democratic regimes in this territory, continuosly

bardian's picture

<I think you are overlooking the fact that, 'that region' contains all the oil we need to run our economy>


No, we don't need foreign oil.  If we want foreign oil, I have a radical plan for you:  BUY IT FROM THEM!!!!!. Since when does peaceful voluntary exchange not work for oil??

Get out of right wing land.

fxrxexexdxoxmx's picture

How does left wing land define "fair" as far as real prices are concerned? We have no need to purchase any hydrocarbons from any foreign entity. Lets use our resources before we find ourselves paying $300.00 dollars a barrel from a nation which is being "fairly" compensated because 400 years ago someone said something mean to them.

Left wing land.....not voting for someone because of their skin color is wrong. Voting for someone if their color of skin is the right color is good, double plus good.

Ray Elliott's picture

I have been informed that the oil in the Williston Basin is greater than all the oil in Saudia Arabia and neighbors.  It has been successfully accessed by the wonders of drilling into shale (about 12,000 ft.), side drilling, and fracing with high pressure water.  The Williston Basin should last far longer than the mideast oil sources.

Let them proceed with the hurling of feces.

roccman's picture

It is less about quantity and more about production rates.


Athabasca will only ever produce 5-7 MB/D. And that assumes all the fresh water and NG are available to "melt rock" into a kerogen - that needs refined AGAIN to get into your tank.


1000 barrels a SECOND is an IMPOSSIBLE act to follow.

Idiot Savant's picture

Correct, and not just rate of production, but infrastructure to transport the oil. Perhaps Mr. Elliot should spend some time over at theoildrum.

sun tzu's picture

We also need oil from Canada, yet we are not bombing them. We need oil from Venezuela and Mexico, and we're not bombing them. Strange how that works. 

IBelieveInMagic's picture

You bomb some and the rest fall in line. Idea is to bomb far off countries as you don't want blowback from countries that are nearby...

roccman's picture

what does OBL have to do with ANYTHING?

you're not suggesting he had something to do with 911?

yes - these wars should end, but they won't because 'merikans think OBL (or whoever the hell is the next boogyman) lives under our collective beds.

Infinite QE's picture

Is RobotTard blind? He still thinks Netflix is going to $1000

legal eagle's picture

By George, I think you have it.

Reid should assume that the gov't will put $1 trillion in to NetFlix stock, that it will go up to $1,000, and that can fund all of our killing brown people for black oil.   Problem solved, move along.

mick_richfield's picture

He still thinks Netflix is going to $1000

I was surprised and a little dismayed  to find myself in agreement with RoboTrader on this point.

But then I realized -- he was thinking share price.  I was thinking market cap.

Mongrel's picture

Because it's "already over," how many ZHers would favor 1) revolution or 2) State secession from DC as a remedy? I know that the sheep will do nothing, so it's 3) serfdom for them.

wardawg12's picture

Definitely number 2 for starters

nedwardkelly's picture

This entire brouhaha is a complete and utter farce. The fact that the current goings on are considered a 'serious' discussion is absolutely ludicrous.

All anyone is talking about is 'deficit reduction'. Noone is talking about deficit elimination, or god forbid, surplus. Maybe we should all try to change the conversation so it's expressed how it really is - this is a conversation about how much the debt will be increased by. Paul Ryans plan, Reids plan, Boehners plan - they're all fatal, just some are slower than others.

A 1 trillion dollar 'cut' over 10 years will result in higher national debt. A 4 trillion dollar cut over 10 years will result in a higher national debt.

Spitzer's picture

Thats what everyone thought but who's gonna cave ? They both keep upping the anti, investing more pride as the days tick by...

macholatte's picture

It's an insult. The George Will quote says it best. To even dignify these "plans" as anything other than scams,  hustles, subterfuge and propaganda with the explicit intention to mislead and swindle the public is outrageous. Yet, nobody rioting. Nobody marching in the street. The sheeple don't feel threatened.


tsx500's picture reason to feel threatened ! -bahhh aahhhh baaa- who got voted off The Bachelor this week . -baaahhhhh bbaaahhhh- Hope &Change - bbaaahhhh

caconhma's picture

People, you are imbeciles.

Both political parties propose to increase the US deficit. None propose to cut deficit.

To make a long story short, America is moving to a bankruptcy. It is a matter of just how soon.

Doña K's picture

Best way to starve the beast: Sell all paper assets and buy physical gold and Silver. Sleep well at night and survive the bust. 

sun tzu's picture

You better stock up on guns, ammo, medicine, food and water too. The majority will not be ready for the collapse and will be gunning for the few who did. Your best friends will slit your throat to feed their children.

tsx500's picture

...damn , there goes my buzz

High Plains Drifter's picture

that's right. everything is on the table except any deductions from the military industrial complex , weapons sales and aid and gifts to see. ryan is a good conservative and a good conservative always supports war and our only "fwiend" in the middle east...............yep, its time to puke......

mynhair's picture

Wrong.  Everything is on the table, but real cuts.

High Plains Drifter's picture

the department of war makes war. we are war economy. when we stop fighting, we die...........the fiat regime has always propped up the military industrial complex and vice versa. they are codependent vehicles.........

mynhair's picture

Oh contrare.  We are the Welfare Economy with the best Food Stamp President in history.

High Plains Drifter's picture

well guess what?  i am sure you know that this new budget deal makes severe cuts in these welfare programs. can you say burning cities?  i knew you could..........we hang by a thread...........

dick cheneys ghost's picture

A disturbing story on Iraq..........


"And so it is that at a cost of over $1 trillion and the lives of more than 4,500 troops, the United States may be on the verge of handing China – America’s main economic rival and long-term threat to its global dominance – the gift of a firm foothold in the Middle East. And this took place without the Chinese having ever supported the Iraq war in any way. Such are the ironies of modern geopolitics".

DosZap's picture


And this took place without the Chinese having ever supported the Iraq war in any way. Such are the ironies of modern geopolitics".

Oh yes they supported it,they were ALL against US going in.............

After we got there, we found out WHY. The sanctions in place, were NEVER followed by China, Russia, and France.

They were doing business as usual w/Sad Man, until we went it.

Got caught w/their Wieners in the gate.

Missiondweller's picture

Interesting story. Thanks for posting

ThirdCoastSurfer's picture

Not to mention all the lives and treasure lost to China in the battles of Vietnam and Korea. The threat of "global communism"  in Asia was not from rice farmers and this way to cozy relationship we have with China and Corporate America is a fist full of feces in the face of US Veteran's who couldn't give a damn about their fallen brothers so long as they can fly the US flag and display the bumper sticker of service that they bought from their former attackers.

Soon no doubt, the troops of Afghanistan and Iraq will be buying whatever Iran has to offer as soon as the TV tells them to. 

fxrxexexdxoxmx's picture

You mean the UAW is paying back the 40 + billion dollars Mr. Obama gave them as payback for the union bribes? Like you said everything is on the table right?

fxrxexexdxoxmx's picture

You mean the UAW is paying back the 40 + billion dollars Mr. Obama gave them as payback for the union bribes? Like you said everything is on the table right?

Ancona's picture

These guys are a total fucking joke.

I'm moving to Burma, at least it's a known value.

mynhair's picture

'Saving'  is a 6 letter word.

Unlike 'suks'.

Noah Vail's picture

American people, who deserve responsible, honest leadership.

Really? Then why do they keep voting into office the same people who do not give it to them? Answer: because they like looting the Federal Treasury.

Missiondweller's picture

People voted for Obama because they did think he was different. They bought into "Hope & Change".


They were wrong.

Cognitive Dissonance's picture

The only thing worse than your own vomit on your shoes is someone else's vomit on your shoes. I don't think this is Paul Ryan's mess on my shoes.

Misean's picture
You can't really dust for vomit.
Cognitive Dissonance's picture


Actually you can. DNA from the stomach acids and cells from the stomach wall with the vomit.

DNA bitches.