Debt, deficits, and entitlements

Byron York says Spending, not entitlements, created huge deficit. Social security, Medicare, and other entitlements are, and have been, a worry but that is about the long term and about trends when current demographics and laws are extrapolated out ten to fifty years in the future. You will see entitlements used as a cause for the current deficits as a convenient foil. That conflates two different problems faced by government.

There’s no doubt federal spending has exploded in recent years. In fiscal 2007, the last year before things went haywire, the government took in $2.568 trillion in revenues and spent $2.728 trillion, for a deficit of $160 billion. In 2011, according to Congressional Budget Office estimates, the government will take in $2.230 trillion and spend $3.629 trillion, for a deficit of $1.399 trillion.

That’s an increase of $901 billion in spending and a decrease of $338 billion in revenue in a very short time. Put them together, and that’s how you go from a $160 billion deficit to a $1.399 trillion deficit.

This gets into the ‘Blame Bush’ in trying to explain away the current situation. That tends to confuse TARP with the stimulus efforts as well as to whitewash the current fiscal situation – in addition to this entitlement conflation.

The bottom line is that with baby boomers aging, entitlements will one day be a major budget problem. But today’s deficit crisis is not one of entitlements. It was created by out-of-control spending on everything other than entitlements. The recent debt-ceiling agreement is supposed to put the brakes on that kind of spending, but leaders have so far been maddeningly vague on how they’ll do it.

The vagueness was illustrated by the recent debt ceiling debate. One side wants to increase taxes and spending and the other wants to reduce spending and lower taxes. At issue is whether the money for government can result for taxes or if it depends upon economic growth. Until the last elections, it was the ‘increase spending’ philosophy that was elected to office. That means that there are two entrenched viewpoints struggling for survival. That means that what might happen in the future and what is the case now just becomes something to manipulate for political advantage.

That is why the ‘both sides do it’ is so dangerous. When you will not take the effort to distinguish between concepts, ideas, and issues, you feed into the ‘vagueness’ and inability to solve problems.

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