Budget 2014: Garbage In, Garbage Out
President Obama finally proposed his 2014 budget today.
The news media, predictably, are fawning all over it; providing all kinds of in-depth analysis. Their analysis, of course, is strictly predicated on whether the reviewer is a Democrat or a Republican.
The President’s budget will be the talk of the town all week long. The pundits will lend us their deep insights and learned summaries of its grandiose highlights.
Seeking Meaning in the Meaningless
In a fruitless quest to find anything whatsoever meaningful in President Obama’s 2014 budget proposal, I came across Chart 4-1 in the section titled, “ECONOMIC AND BUDGET ANALYSIS“.
The President’s highly paid White House budget analysts tell us that the President’s budget will reduce “net deficits” by $1.8 trillion over the next 10 years.
As if that fairy tale wasn’t enough, they took government fantasy to an entirely new level with Chart 4-1.
Chart 4-1 shows how President Obama’s deficit reductions will affect “Publicly Held Debt” in the future. By that they mean the “Debt Held by the Public” portion of the national debt. It is expressed as a percentage of GDP.
The chart covers a 145-year period of time from 1940 to 2085. The left side shows where we have been. The right side shows where President Obama will take us.
Early in the next 10-year cycle public debt will rise from its current 73% of GDP to around 80% (≈$13 trillion) before leveling off for a couple decades or so. Then, around 2040, public debt will dramatically fall until it drops to zero around 2060. The national debt will be paid off! Yippee!!!!
After that we get budget surpluses. They soar. By 2085 the budget surplus will be 70% of 2085’s GDP. By then that will probably be about $50 trillion or so; maybe more. The federal government will be swimming in money.
If you believe anything beyond that public debt will immediately jump from 73% to 80% of GDP, then I got some bridge property in Brooklyn I’ll sell you cheap.