Jawbox wrote:
If you weren't such a tool you'd see that the article is not criticizing Bush so much as it's criticizing the method of calculating the deficit. Bush *should* be the focus though, because unlike Clinton and every other President before him, Bush and the current Congress can actually still do something about it. And of course another reason to focus on Bush is because he's supposed to be a conservative.
And yet, you felt that it was the "source" of your argument that Bush was a HORRIBLE president because he's run such a high deficit according to this very article...
You criticized Bush. You did so specifically because of the statements in this article. Is this going to be yet another one of those threads where I point out that your own reactions to the article refute your claims that the article wasn't aimed at Bush?
You didn't say that "Clinton was a HORRIBLE president", did you? You didn't name any other president. Yet they all use(d) the "cash accounting" methodology, didn't they? Why single out Bush?
Quote:
An argument might be made for excluding Social Security and Medicare from the numbers because unlike corporate retirement accounts, they are not guaranteed payouts (instead they're "pay as you go"). I don't necessarily agree with that take, but at least there's an argument to be made.
Even granting that, it still leaves a FY2005 deficit of $760 billion according to a perfectly rational, commonsensical method of accounting that's used by law in the corporate world. Read the fUcking article! It's all laid out pretty well.
Governments are not private businesses though. The problem is that a private business will counter costs accrued with "payments accrued" at the same time. What is not mentioned in the article (which is *amazingly* one sided), is that a business also records a profit when it signs a contract deal. So, if I make a deal in which you promise to buy X number of units of my product over the next Y years, I get to put the projected profits into my accounting sheet
right now. It works both ways.
But governments do not generate "profits". They are not businesses. Thus, there is no counterbalance to an accural accounting method. You're only counting future costs on an accrued basis, never future revenue (since revenue is strictly generated on a per-year tax/levy/tarrif basis). Governments gain revenue when the tax base increases (over time). But they can't put that on an accounting balance sheet because the tax law can (and usually does!) change between now and then.
Can Bush put the projected increase in tax revenue over time from his tax cuts into the accounting sheet? No. He can't. Yet any sane economist can agree that increased tax base means increased federal revenues over time. The relationship is well understood, but you can't accurately predict exactly how much of an increase you're going to get, nor can you predict exactly how much additional revenue you're going to generate as a result.
Worse. If you were to attempt to create this sort of system, you'd be in the unusual (and illogical) position of arguing that raising taxes without end is "good", since that's going to show up on an accrual accounting balance sheet (better yet is passing laws mandating tax rate increases over time). The government equivalent to that "big contract" that businesses put on their accounting sheets would be exactly a law setting tax rates for X years. Thus, you'd generate a revenue bonus *now* for future taxes.
I suppose if your agenda is to make it appear on an accounting sheet that raising taxes is always the best solution to every problem, then you'd be all for this. Since the presure to "reduce the deficit" would be very very real, but the only way for a government to do that is to legistlatively raise taxes. It would end up being a tool to do exactly that.
If you are a proponent of Liberal economic theories, and believe that the only way to increase revenue over time is to increase taxes, then this all makes perfect sense. But if you are a Conservative, you believe that *lowering* taxes will increase the growth rate of the tax base and over the long run result in a greater "real" revenue while decreasing the "footprint" of government. And if you do believe that, then this is a horrible idea since it magnifies the costs, while hiding the economic effects that will make those costs managable down the line.
Quote:
You're so goddamn hypersensitive about "Bush bashing" that you cannot see the problem before your eyes, and you're stuck in this awkward position of having to defend an accounting practice that works against fiscal conservatism. You should be agreeing with me, you stupid tool!
Well. If you hadn't started out by calling Bush "HORRIBLE", maybe I wouldn't have responded to your post as a "Bush bash". If you honestly want to discuss this accounting methodology, how about actually talking about *it* instead of simply using it as a means to bash Bush...?
Dunno. Just seems kinda obvious to me.