Posts Tagged ‘Mike Bates’
April 27th, 2011 at 3:56 pm
Breaking Down the Budget “Deal”
Posted by Print

The budget compromise reached between Congressional leaders and the White House a few weeks ago has been analyzed, dissected and commented upon exhaustively.  While the “deal” may have averted a government shutdown, it ended up being a disappointment to taxpayers, who were overwhelmingly demanding meaningful spending cuts this year. 

In an attempt to help the American people better understand what transpired, Mike Bates of 1330 AM WEBY, Northwest Florida’s Talk Radio, prepared and recently read the following analysis of the “deal” on the air. 

The Budget Agreement is Nothing to Celebrate
The “government shutdown” was avoided when Republicans and Democrats in Washington agreed to a budget compromise to cut $38.5 billion from the proposed $3.8 trillion budget.
Though it’s been touted by both parties and the press, this is no cause for celebration.  Why not?
A few quick facts:
Our national debt is $14.2 trillion.
This year’s budget calls for $3.8 trillion in spending.
Our government will borrow $1.6 trillion to do this.
That means we are borrowing 42 cents of every dollar we spend.
We are spending $1.6 trillion dollars more than we are taking in.
The Republicans wanted to cut $45 billion from the budget.
The Democrats wanted to cut $33 billion from the budget.
The Republicans and Democrats were arguing over $12 billion.
They agreed to cut $38.5 billion.
Few people comprehend how bad our nation’s finances are.  Just how much is a trillion dollars?
If you laid one trillion one-dollar bills end to end, it would extend from the Earth to just past the Sun.  It would stretch to the moon 394 times.  And that trillion dollars would wrap around the Earth 3787 times.  But money is not understood as a measurement of distance.
If you spend one dollar every second, it would take you 32,000 years to spend one trillion dollars.  But money is not a measurement of time.

Money is a measurement of value.  So I broke down the budget into terms we can all understand.
A husband and wife have accumulated debt of $373,684.
They have a household income of $58,000.
They plan to spend $100,000 this year.
So they’ll have to borrow $42,000 to do this.
That means they are borrowing 42 cents of every dollar they spend.
One spouse proposed that they cut $1184 from the budget.
The other spouse proposed that they cut $868 from the budget.
The husband and wife were arguing over $316.
They agreed to cut $1013.
How long can that couple keep borrowing and spending like that?  How long can our government keep borrowing and spending like that?
The budget agreement is nothing to celebrate.
But wait!  It gets worse.  Within a week of the budget deal, the Congressional Budget Office announced that the actual savings of the claimed “$38.5 billion” in cuts could be as little as $352 million.  If that turns out to be true, the couple above just saved a pathetic nine dollars and twenty six cents.