(all times in parenthesis are time offsets into the video)
- (0:21) Look at that chart – what is the scale along the X-axis? How can you figure out where a certain year is? Also, notice how positive numbers are on top of the chart – we’ll come back to that.
- (0:31) “Running a surplus…” – That means the gov’t took in more money than it was spending. Briefly. Look at the chart when Mr. Lew runs his fingers over it describing his “projected” $5 Trillion surplus, the chart tanks immediately, “Projected surplus” means if everything goes exactly as planned, and if no subsequent administrations change anything, then the “projected surplus” may be realized, but how rare is it that a President could enter office, occupy it for eight years and not do anything different from their predecessor?
- (0:46) Look at the chart around 2008, the year of the presidential election (can’t tell for certain because of the ambiguity of the X-axis), see how the budget is coming around? That was short-lived – soon the financial system collapsed and the housing bubble burst, and soon we TARPed and stimulated ourselves into record levels of deficit spending.
- (1:01) Look at the chart as you go beyond the current line into the future – notice how we surrender nearly every reduction in the deficit in the next year or two, taking our deficit spending to new record-heights before it resumes going down. Why? There may be a very valid reason, but Mr. Lew offers no insight into this…
- (1:08) “A place where we can actually pay our bills” – Is Mr. Lew really pointing at the projected 3-4% deficit spending and saying with a straight face that we can “actually pay our bills”? We’ll be spending 3-4% of GDP, which equates to what percentage of projected revenues, Mr. Lew? 10-13% of revenues? I wouldn’t refer to someone living 10-13% beyond their means as “paying their bills.”
- (1:22) Hey look, they inverted the graph, negative numbers are now above the X-axis. Of course they changed the chart from “Surplus/Deficit as a Percent of GDP” to “Projected Deficit as a Share of GDP”
- (1:29) Oh, that’s why they changed the chart – it is to allow them to compare their imaginary projected budget over the next ten years against some other imaginary baseline budget projected out over the next ten years with the distracting reality of where we are or the context of the last few years. Notice how spending for the current year and into next year exceeds even the imaginary “baseline” spending.
- (1:30) “When the President took office deficit, as a share of our economy, was growing to 10%…” – If I go back to (0:51) I see that for the year 2008 the deficit spending was anywhere from 5-9% (I wish they did a better job marking the years along the Y-axis).
- (1:43) “If you look at this red line, you can see we’ve got a lot of progress to show for the last few years..” – Uhm, no – those are made-up projections based on hopes for the economy, just because you can imagine a better tomorrow doesn’t mean you’ve done anything significant – it also doesn’t mean you haven’t, all it really means is you’ve played with the numbers enough to make a plausible story of what might happen with the economy.
- (1:50) “The deficit is coming down considerably because of the decisions we’ve made that have gotten the economy growing again…” – so somehow, a chart of how much more we are planning on spending than we predict we will take in revenues shows that the economy is growing? I think these are two distinct ideas, “getting the economy growing” doesn’t directly reduce deficit spending, it adjusts the percentage of GDP the deficit spending represents – deficit spending is still spending money you don’t have.
- (2:00) “Over a trillion dollars of additional deficit reduction policy decisions…” – That works out to $100 Billion/year for the next ten years. That is not a serious effort to reduce deficit spending, we will still be spending nearly three-quarters of a trillion dollars more than we take in each of those ten years, in the President’s hopeful projections for the next ten years.
- (2:12) “In the neighborhood of 3% of our economy…” – Three percent of GDP is what percentage of government revenues – I estimated 10-13% earlier – are you saying we can sustain living 10-13% beyond our means, are you arguing that is sustainable? I disagree.
- (2:20) “Cut our deficit in half…” – Deficit is a function of spending, and is NOT our debt level – your plans for the economy will grow our debt to previously unimagined levels, approaching $25 Trillion from its current $14 Trillion level in the next ten years. If we keep adding about $750 Billion to the debt each year, how do we ever pay it off?
- (2:30) “Cut the deficit by two-thirds by 2020…” – Deficit is spending beyond revenues, not debt. And by the way, 2020 is the end of President Obama’s successor’s first or second term – any chance that administration might view things differently? Might want to adjust spending? Adjust tax rates? If they do, all these rosy projections are out the window, and by the way – I can’t imagine a presidential candidate running on a platform of doing exactly what the previous administration thought was the right thing to do with the economy – can you?
- (2:45) “A very important down-payment…” So even this President, as he proposes this ten-year budget plan, is saying we need to have further discussions about how to address the rest of the deficit spending – if HE won’t stick with this plan, how can he argue it is an accurate prediction of the next ten years?
- (2:50) “Like every family we need to tighten our belt, and live within our means…” – And the ten-year budget plan you’re proposing Mr. Lew has us living beyond our means each of the next ten years, turn around and look at your own chart.
- (2:57) “Bipartisan basis“
- (3:11) “Bipartisan basis” If he said it one more time, it might have happened (assuming “Bipartisanship” is like “Beetlejuice” – if you invoke its name three times, it appears)
Remember, reducing the amount of deficit spending (as Mr. Lew is describing above) does nothing more than lower the amount we will increase the debt we, as a nation, are carrying – we have to eliminate deficit spending just to freeze the debt level, and you need to run a surplus and commit the surplus to paying down the debt to reduce the debt level. All President Obama (and Mr. Lew) are proposing is that we are going to start adding less to the national debt going forward. Promise. Unless something changes in the next ten years.
Whitehouse YouTube Video: White Board: OMB Director Jack Lew on the President’s Budget
ChaCha.com: What happens when you say Beetlejuice 3 times?