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Never Trust Government Numbers

Comment

President Obama said in his State of the Union speech, "We've already agreed to more than $2 trillion in cuts and savings."

That was reassuring.

The new budget he released this week promises $4 trillion in "deficit reduction" — about half in tax increases and half in spending cuts. But like most politicians, Obama misleads.

Cato Institute economist Dan Mitchell cut through the fog to get at the truth of the $2 trillion "cut."

"We have a budget of, what, almost $4 trillion? So if we're doing $2 trillion of cuts," Mitchell said, "we're cutting government in half. That sounds wonderful."

But what the president was talking about is not even a cut. The politicians just agreed that over the next 10 years, instead of increasing spending by $9.48 trillion, they'd increase it by "just" $7.3 trillion. Calling that a "cut" is nonsense.

Mitchell gave an analogy: "What if I came to you and said, 'I've been on a diet for the last month, and I've gained 10 pounds. Isn't that great?' You would say: 'Wait, what are you talking about? That's insane.' And I said: 'I was going to gain 15 pounds. I've only gained 10 pounds, therefore my diet is successful.'"

Democrats use this deceit when they want more social spending. Republicans use it for military spending.

And the press buys it. The Washington Post has been writing about "draconian cuts."

"The politicians know this game," Mitchell said. "The special interests know this game. Everyone gets a bigger budget every year. ... And we wind up, sooner or later, being Greece."

We are definitely on the road to bankruptcy.

"We have maybe 10, 15 years' advanced notice. And what's frustrating is that we're not taking advantage of that, even as we see these other countries collapsing into social chaos and disarray."

Mitchell points out that the politicians don't even have to make actual cuts to save the future. If they just slowed the growth of government to about 2 percent per year, the U.S. economy could grow out of this mess.

But the politicians won't do even that.

"Being from the Cato Institute, I actually do want to cut spending. But if all we're trying to do is balance the budget over 10 years, which is sort of the minimal thing that politicians keep saying we should do, if we simply limit the growth of spending to 2 percent a year, which is about the projected rate of inflation, we'll have a balanced budget in 2022. ... But instead, the politicians say, 'Oh, we'll have draconian and savage budget cuts.' ... They don't want to put government on a diet, even if that diet allows spending to grow 2 percent a year."

They also continually mislead us about what their schemes will cost.

President Bush said the war in Iraq would cost $50 billion to $60 billion. It cost $800 billion. When Medicare Part A was created, the government said it would cost $9 billion in 1990. It cost $67 billion. They said the hiring of TSA airport security screeners would cost $100 million. Then they spent $700 million. Yet the media report the estimates as if they are realistic. Again and again, politicians get away with underestimating the cost of their programs.

Often the cost goes up because people change their behavior to get free stuff. A program meant to help the needy costs a certain amount. The next year, it costs more, because now more of the needy know about the program and more social workers know how to tap it. The next year, the non-needy feel like suckers if they don't get the handout, and they figure out a way to game the system.

Then, Mitchell point out, "what do politicians do the next year? They expand the program to buy more votes. And the year after that, they add a new benefit. That's what's happened with Medicare. It's not just that they got the fundamental estimates wrong. They did. But every new generation of politicians figures out some new expansion, some new benefit."

And so we're on the road to Greece.

Bottom line: Don't trust the politicians' numbers.

John Stossel is host of "Stossel" on the Fox Business Network. He's the author of "Give Me a Break" and of "Myth, Lies, and Downright Stupidity." To find out more about John Stossel, visit his site at <a href="http://www.johnstossel.com" <http://www.johnstossel.com>>johnstossel.com</a>. To read features by other Creators Syndicate writers and cartoonists, visit the Creators Syndicate Web page at www.creators.com.

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Comments

9 Comments | Post Comment
like to see your fiquires if the national budget in thousands as shown on the o'reilly show between fel11 and14th
Comment: #1
Posted by: virgil thomson
Wed Feb 15, 2012 7:19 AM
Where can I find the budget chart John Stossel presented on O'Reilly Factor (I think) last night?
Comment: #2
Posted by: Larry
Wed Feb 15, 2012 10:32 AM
I am looking for the chart that was shown on O'Reilly last night too.
Comment: #3
Posted by: Debby Beck
Wed Feb 15, 2012 1:27 PM
You were on Bill O'Reilly on February 14th talking about the national debt and washington spending but presented in a very interesting way. You used a chart with an individual earning $25,000 a year with a spending habit of approximately $38,000 annually and a morgage of approximately $138,000 who decided they needed to save. I would very much like to get the numbers you presented and a short narrative on what the numbers represented. Thanks.
Comment: #4
Posted by: David Solberg
Wed Feb 15, 2012 5:27 PM
Where can I get a copy of the presentation John Stossel made on the O'Reilly show Feb 14? It was brilliantly superb. At last there is someone that is bringing the dire picture to a way we can show the common men how err responsible our Present and his co hearts are. Please help me get a copy of the presentation John Stossel made. I need to show it to as many friends as I can before the election.
You are doing excellent work, our wonderful country needs you, please keep it up. The piece Never Trust Government Numbers was exceptional also. May god bless and keep you. I agree with David S and the others who commented here! Where can we get the chart and a good understanding of the numbers and what they represent?
Ed Ripley
Comment: #5
Posted by: ed ripley
Wed Feb 15, 2012 7:00 PM
Ditto to the requests above, I would love to show this to my intro to econ students and my high school marketing students. Please post this chart. I frequently use Stossel in the Classroom for both my college and high school students. Keep up the great work.
Comment: #6
Posted by: Jackie Herrmann
Wed Feb 15, 2012 9:04 PM
The D.C. diet is for fat -
Not how to eat, but how to spend,
Spending for spending, tit for tat,
D.C. powers that be pretend
That what is spent is a huge cut
On what would have been spent to please
The voting We the People, but
Only some constituencies.
And with the spending comes the lies,
The facts and figures twisted to
Prettily package the surprise
Filled full of spending fat to chew.

The D.C. diet worrisome?
The glutton like Greece day will come.
Comment: #7
Posted by: Ima Ryma
Thu Feb 16, 2012 12:13 AM
Can the budget be set to a %age of GNP as predicted based on a straight line regresion model of the most recent 20 years? I know it's not perfect, but at least it would be some idea of adjustment for inflation, and it would allow for a true measure of how it will affect us based on the %age that we give up to government.
Comment: #8
Posted by: Corey
Thu Feb 16, 2012 8:22 AM
Friday, June 3, 2011Warning: This Message Contains Democracy
Susan Lindauer, Contributing Writer
Activist Post

No great civilization is ever destroyed from without, or conquered by external forces, until it first destroys itself from within. America's leaders should have thought long and hard about that before voting to extend the Patriot Act last week.

Unhappily it's official. We the People are the enemy. We have dared to prod and examine government policy too closely. We have questioned government leadership when we should rightly have obeyed without challenge. Some of us have exposed wrongful government practices and deceptions, expecting to hold Congress and White House leaders accountable to voters. Foolish us!

Last week Congress set the record straight. Breaking campaign promises to defeat the Patriot Act, Congress blocked hearings and debate on amendments that would fix problems in surveillance rules, and rammed a four year extension on the American People. Only 31 Republicans and 122 Democrats voted against the Patriot Act in the House.

IMPORTING GESTAPO LAW

It's no exaggeration, unfortunately, that the Patriot Act is more dangerous to our way of life than any foreign enemy.

Most ominously, entire sections of the Patriot Act are verbatim and identical to two of the most frightening laws in World History:


• The 1929 Bolshevik Communist Criminal Act established Communist control in the age of Joseph Stalin. It created a security apparatchik unparalleled in its intrusion into the lives of ordinary, non-political families. For enforcement, it created the Gulags, which quickly filled with intellectuals and dissidents, poets and hard luck Russian people who got caught in the wrong place at the wrong time. It was enough for a neighbor to point a finger secretly for that individual to disappear to the Siberian work camps for life. Secret charges, secret evidence, secret accusations figured prominently--- identical to the Patriot Act.

• It's hard to say if that's worse than Germany's Enabling Act in 1933. Such comforting words, "the Enabling Act" established the legal framework for Nazi Fascism. The Enabling Law lay the parameters for the Third Reich of Adolph Hitler.

According to history buff, Alan Batterman, the German word for “Gestapo” is an acronym of GEheim STAdt POlezi. Translation: “Homeland Security.”

Unhappily, for free thinking Americans, Batterman's analysis is correct. Paragraph for paragraph, clause for clause, laws establishing fascist control over the Soviet Union and Nazi Germany are replicated in the Patriot Act today.

Like the iron fist of the Nazis and Communists, Americans must submit to "roving surveillance" and warrantless searches, without the requirement of a Judge's authorization. Surveillance laws are part of a larger arsenal of weapons against political dissidents and whistle blowers. Most Americans don't know the Patriot Act authorizes secret charges relying on secret evidence and secret grand jury statements. Under the Patriot Act, Americans have no right to know who has accused them of what criminal activities, or the dates of the alleged offense. They're not even told what law was broken. The government has power to lock up Americans on military bases or other prisons without a hearing or trial. We can be detained indefinitely without any rights of due process at all.

Perhaps it's fitting, therefore, that Nazi Leader, Herman Goering, should explain the New America to us, as we tread into this new age so dangerous to freedom:

“Voice or no voice, the people can always be brought to the bidding of the leaders. That is easy enough. All you have to do is tell them they are being attacked, and denounce the pacifists for lack of patriotism and exposing the country to danger. It works the same in any country.”

Powerful words of warning, indeed. I recognise that your Obama is anHabitual Liar, and is also not a legal anything.

Comment: #9
Posted by: Paolo
Sat Feb 25, 2012 9:00 AM
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