Tag Archives: budget

Furloughed NSA

furloughed-nsa

If you’re reading this in the distant future, this is regarding the 2013 U.S. government shutdown and the NSA surveillance scandal

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Via FAIL Blog

Where The Unexpectedly Huge National Debt Came From

As we’ve seen before, in the year 2000 the Congressional Budget Office, which does official economic forecasting for Congress, predicted that by 2012 the national debt would be wiped out. What actually happened is that the debt increased five times over. To explain how that once-likely prediction became just another unrealistic dream, the left-leaning Center For American Progress broke down the numbers in a short video; of the 12 trillion dollar difference between projected and actual revenue:

  • 4.7 trillion (40%) went to extra Bush spending (wars in Iraq and Afghanistan, increased Medicare coverage, increased domestic security, debt repayment)
  • 3.3 trillion (26%) disappeared due to two economic downturns — the Internet bubble in 2001 and the real estate bubble in 2008
  • 2.3 trillion (20%) went to pay for Bush tax cuts
  • 1 trillion (8%) went to extra Obama spending (continuation of Bush tax cuts, new Obama tax cuts and other policies)
  • 0.7 trillion (6%) went to the 2008 stimulus to bail the country out

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From YouTube, via FAIL Blog

Why We Absolutely Need The Fiscal Cliff, Or Something Like It

For several weeks, especially since the election ended, the media has been focusing its attention on the coming fiscal cliff. Most reporting talks about one thing: that the cliff will push the country into another recession. What very few stories mention is that the recession would be short, that it would balance the budget and set the economy up for expansion.

That is the opinion of the non-partisan Congressional Budget Office, which has been publishing economic projections for Congress since 1985. It puts out two scenarios: a baseline, in which the current economic policies continue, and an alternative, which considers other popular policies. Its latest publication makes it clear that the fiscal cliff is bad for the short term, but necessary for the long term. The alternative scenario, in which we avoid a fiscal-cliff-type of event, would have the public debt rise to 90% of GDP — levels unseen since WWII.

 

Source: The Committee For A Responsible Federal Budget. Credit: Lam Thuy Vo / NPR

 

The current debt level is at 77% of GDP  — the highest since 1950. If the fiscal cliff does happen, over the next decade that figure would drop to 58%, instead of rising to 90%.  (Which is still not good since, historically, it’s been around 40%.) Before that would happen, however, the economy would go into recession in 2013 and the unemployment rate would rise 9%. But, the next year, the economy would start to grow again, unemployment would drop to 5.7% by 2017, and further to 5.0% by 2022. Alternatively, without the fiscal cliff, says the CBO:

Ultimately, the policies assumed in the alternative fiscal scenario would lead to a level of federal debt that would be unsustainable from both a budgetary and an economic perspective. — From “An Update to the Budget and Economic Outlook: Fiscal Years 2012 to 2022“, by CBO

Austerity measures are desperately needed, and it’s quite amazing that a do-nothing Congress as polarized as this one was able to pass a pretty good solution to our budgetary woes in the form of this fiscal cliff. But it’s clear that even it won’t be good enough: the national debt needs to drop even further. This becomes obvious after realizing that the fiscal cliff provides only 0.5 trillion extra funds, on a 4 trillion dollar budget. Ten years ago, the budget was 2 trillion. Five years ago, almost 3 trillion. The fiscal cliff would see that 4 trillion dollar budget shrink by just 2.5%, when it really should shrink ten times as much.

When Clinton left office in 2000, public debt was projected to be zero in 2012 — instead it multiplied five times over. If Congress and the President come to an agreement to avoid the fiscal cliff, it should be only to make even deeper budgetary cuts.

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From CBO and NPR

Smoking Bans Will Cause Healthcare Costs To Rise Even More

NPR has an article highlighting two studies which show that indoor smoking bans have a big effect on people’s health:

  • The first study focused on a Minnesota county that banned workplace smoking and found that heart attacks dropped by a third within a year and a half of the ban
  • The second one was a meta-study which concluded that smoking bans were likely the reason for a drop in heart attacks and strokes by a sixth and of lung diseases by a quarter.

Photo by RawMotion

As we saw before, heart attack, cancer, lung disease and stroke are the top four causes of death in America, and together are responsible for 57% of fatalities. Smoking is a factor in all of them. Politicians and anti-smoking advocates are quick to point out not only the public health benefits of smoking bans, but also the financial savings due to all the health care that’s not being provided anymore. (The same holds true for food taxes and bans, like Hungary’s junk food tax.) At first blush, that makes sense, because if people aren’t having heart attacks and strokes, they won’t need as much care. And in the short-term, that may be true. But what is often forgotten is that everyone grows old, and aging is far worse for your health than smoking: over their entire lifetime, a smoker’s healthcare is estimated to cost about 326,000$, but because the non-smoker will live longer, their bill will run 417,000$ — 28% more.

Therefore, it’s crucially important for everyone to realize that in this age of health and budget consciousness, the two goals of living longer and spending less on healthcare are very much at odds with one another. Without any improvement to the health status of the population, healthcare costs are predicted to increase even beyond the currently oppressive levels. Almost half of our government expenses are currently used by two agencies specializing in geriatric care: Social Security Administration and Department of Health and Human Services, which includes Medicare. With half of the states in the union having already enacted comprehensive smoking bans, those agencies’ budgets will only need to go up, and eventually, most of the government’s function will be simply to care for the elderly.

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From The Archives of Internal Medicine and Circulation, via NPR

The US Budget Deficit Explained

 

Via Uber Humor