Patterico's Pontifications

1/20/2013

Charts: The Problem Is Not Revenue But Spending, and Chuck Schumer and President Obama Are Not Being Honest

Filed under: General — Patterico @ 1:06 pm

Republicans are caving again:

Backing down from their hard-line stance, House Republicans said Friday that they would agree to lift the federal government’s statutory borrowing limit for three months, with a requirement that both chambers of Congress pass a budget in that time to clear the way for negotiations on long-term deficit reduction.

The new proposal, which came out of closed-door party negotiations at a retreat in Williamsburg, Va., seemed to significantly reduce the threat of a default by the federal government in coming weeks. The White House press secretary, Jay Carney, said he was encouraged by the offer; Senate Democrats, while bristling at the demand for a budget, were also reassured and viewed it as a de-escalation of the debt fight.

The change in tack represented a retreat for House Republicans, who were increasingly isolated in their refusal to lift the debt ceiling. Speaker John A. Boehner of Ohio had previously said he would raise it only if it were paired with immediate spending cuts of equivalent value. The new strategy is designed to start a more orderly negotiation with President Obama and Senate Democrats on ways to shrink the trillion-dollar deficit.

On Meet the Press, where he appeared with the impressive Ted Cruz, Chuck Schumer portrayed this as a big victory for Democrats. I guess it is. You already know my view. I don’t think we should be using the debt ceiling as a negotiation point, because I think Obama would love to play hardball on that, and I think it makes more sense for us to play hardball on the budget than the debt ceiling. I think requiring the Senate to pass a budget makes sense; but Democrats have to be honest about spending. Schumer was incredibly arrogant as he pronounced that the budget will have revenues, and that people like Ted Cruz are just going to have to get used to it. Watch at 12:25 and especially at 13:12

We’re gonna do a budget this year and it’s gonna have revenues in it, and our Republican colleagues better get used to that fact.

He can’t talk about spending cuts. It’s revenues, revenues, revenues. As if that’s the problem.

Well, it’s NOT. Schumer is not being honest. Obama (who makes the same arguments) is not being honest.

The problem is spending. Let’s look at the facts. The chart shows federal revenues over the years. The blue part is what we get from income taxes:

Source

As it says at the link: “Federal revenue has remained relatively steady, holding between 15 and 20 percent of GDP.” This is true regardless of the top tax rates, which are shown in the next chart:

Source

So, historically, you can raise that top rate to 90%, and you can’t get more than 20% of GDP — likely because raising taxes generally impedes economic growth, which is a critical determinant of how much revenue the government takes in.

Meanwhile, federal spending as a percentage of GDP improved under Clinton, got worse under Bush, and then became catastrophic under Obama:

Source

Again, because revenue never gets above 20%, we need the points on that chart to be between the bottom (15% of GDP) and about where that first point is (a bit less than 20% of GDP).

And when we talk about the spending problem, we are talking about entitlements.

Source

I have blamed the electorate for killing any candidate who wants to talk about entitlement reform, but a friend suggests that maybe it’s not the electorate’s fault, because they don’t really understand what is causing the problem.

I hope she is right — because if she is, we have a chance to turn this around. (I have to admit I am skeptical.)

I’m going to keep publishing these charts, hoping that my friend is right and we simply need to educate people about the problem. Then again, we’re talking about an electorate where most voters in the 18-to-29 set don’t even know what issue was decided in Roe v. Wade. I really worry that people who are that ignorant cannot be educated.

But I’ll keep trying. We all have to try.

45 Responses to “Charts: The Problem Is Not Revenue But Spending, and Chuck Schumer and President Obama Are Not Being Honest”

  1. Ding.

    Patterico (8b3905)

  2. these are the same republicans who just voted for porky porky christ christie’s pork-packed welfare for jersey trash bill yes?

    lol

    happyfeet (ce327d)

  3. sorry *chris* christie obama is the christ christie’s more of a friar tuck in the larger redistribution scheme

    happyfeet (ce327d)

  4. Heh. You used “honest” and “Chuck Schumer” in the same sentence — correctly!

    htom (412a17)

  5. but a friend suggests that maybe it’s not the electorate’s fault, because they don’t really understand what is causing the problem.

    I don’t buy that, mainly because I observe human nature at work in nations like France, Venezuela, Greece, Argentina and Mexico, throughout much of urban/blue-state America, throughout too much of the Western World in general, and the Third World in particular, and I have little confidence in how far too many people will behave, regardless of the amount of information at their fingertips. That’s even more the case in this age of instant communication, with the internet and alternatives to the traditional MSM, which didn’t exist in the past.

    The argument of “they don’t understand” might have been valid decades ago, or even as recently as 10 to 20 years ago, but not today.

    Simply put, humans tend to be selfish, greedy, shortsighted, full of self-entitled laziness and hooked on instant gratification. Moreover, too many of us fall for the idea that “mommy” (ie, the stereotype associated with liberalism) is spontaneous, heartwarming, snuggly, beautiful and easygoing, while “daddy” (ie, the stereotype evoked by conservatism) is fuddy-duddy, boring, inflexible, uncaring and the force that sets down killjoy rules and restrictions.

    Some have said that liberalism is a mental disorder, and we’re all afflicted by and infected with that to varying degrees.

    Mark (e66007)

  6. They already got their tax increases on the evil wealthy, coupled with all the internal taxes found in ObamaCare.

    JD (d420da)

  7. ” historically, you can raise that top rate to 90%, and you can’t get more than 20% of GDP ”
    Don’t you mean
    “historically, you can raise that top rate to 90%, and you can’t get moreless than 20% of GDP”

    Otto (e9afc7)

  8. The question is now, “how soon and how completely will the eGOP cave?”

    There is no longer a question of “whether.”

    They are now caving preemptively. The next step is for them to openly and actively stop pretending to oppose the Democrats though it may take a bit longer for them to reach that stage.

    The eGOP is part of the problem. Boehner, Cantor, McConnel and now even Ryan can’t wait to give everything away to the Democrats….

    WarEagle82 (97b777)

  9. I have blamed the electorate for killing any candidate who wants to talk about entitlement reform, but a friend suggests that maybe it’s not the electorate’s fault, because they don’t really understand what is causing the problem.

    I hope she is right — because if she is, we have a chance to turn this around. (I have to admit I am skeptical.)

    I’m not skeptical, Pat. That would imply there’s room for doubt. Your friend is wrong.

    It’s very simple. Every single problem we have has been created by the politicians we keep voting for. Every single one. Yet, people keep voting for them.

    Why do we have deficits. Because the politicians created the problem. Then they campaign against deficits. So they go back to the voters and demand more power of coercion to fix the deficits.

    I italicized deficits because you can substitute just about any issue and it plays out the same way.

    Try “gun violence.”

    Look at our foreign policy in North Africa right now. I’ve decided the old saying when talking about Arab/Berber/Iranian dictators never really applied, “He may be a bastard, but at least he’s our bastard.” No, that was ever it. It was more like, “He may be a bastard, but at least he’s not at our throats.” That would have applied to Qaddafi; he didn’t need to be “our bastard” to have us leave him alone. I do admit I feel kind of bad for him; he openly admitted he gave up his WMD program because he didn’t want to end up like Saddam.

    He didn’t; he ended up worse. You know what happens when we throw bastards like Qaddafi and Mubarak to the wolves? We breed wolves.

    And now, one of the chief wolf-breeders has screwed the pooch in so many parts of the world she’s seen as the front-runner for the 2016 Democratic nom (how’s that for mixing metaphors?).

    As long as people are stupid enough to keep voting for politicians who see job security in creating and cultivating problems then that’s what we’ll keep getting.

    Steve57 (4c041b)

  10. The part at the end when Schumer talks about Hagel is interesting.

    DRJ (a83b8b)

  11. Mark,

    It sounds like you think the American electorate is like the European electorate. Maybe you’re right and I’m sure some of them are — especially the young, who have been educated to believe in social justice — but are we Americans really just like the Europeans? For example, the British didn’t seem to mind being disarmed but, as we’ve seen recently, a lot of Americans would object to giving up their guns.

    DRJ (a83b8b)

  12. Patrick Frey,

    I have an open offer for $2000 to help a person that you say has lupus (and on whose behalf, you solicit you readers to donate).

    I’ve asked for an email from you to discuss how I can help her, but to date, have heard nothing.

    Of course, I am perplexed. Was this solicitation legitimate or do you not care to answer your email queue? Is there some other reason?

    Patiently Yours,

    Paul Deignan

    deignan (7f26a5)

  13. Trolls are so droll.

    JD (b63a52)

  14. Paul,

    Just contact Mandy, you dont need to publically contact Pat, and makesomeaccusations

    EPWJ (c5f1fc)

  15. Well Mark’s point is accurate up to a point, however he focuses merely on Europe and Latin America, Australia shows some of the same aspects, Canada surprisingly, less so,

    narciso (3fec35)

  16. While I appreciate the thrust of Rico’s that the SS scheme was a wrong turn from the start, a stroke for redistribution at the expense of self-reliance, not merely misguided but a considered scheme to grease the skids of socialism from its inception.

    Until recently, the ‘trust fund’ financed government for its own sake, but now that its met its foreseeable demographic Waterloo it must change. Repayment of those who’ve funded it is suicide.

    Yet to leave the conversation there would be as much a disservice to us all. Government isn’t just wasteful, redundant and counterproductive. Government is the enemy–not in theory, in practice.

    gary gulrud (dd7d4e)

  17. The Stupid Party shoots itself in the ass again.

    They should have required the Senate to pass a Budget before any consideration of a Debt Limit increase would be taken up on the House floor.

    We are in the very best of hands!

    askeptic (2bb434)

  18. Unfortunately, I don’t know Mandy. From what I see, she write some good material–but I do not have much time to read everything on the interenet.

    Now, I know Patrick just enough that I respect his credibility. Without his putting his name behind this cause, it would be nothing to me.

    So I think it is right and proper to close the loop. We are all busy people.

    BTW, I demand the same from Senators and Congressman. This is no inconvenience for us. It is just common consideration that we ought to expect.

    deignan (7f26a5)

  19. “…a lot of Americans would object to giving up their guns.”

    Yes, and I just met 60K of them at the SHOT Show where the industry’s production for the next year or more is already committed.
    If you’ve wanted a new gun, or some ammo, and you haven’t already put a deposit on it, you’re going to wait a very long time.
    It is the one manufacturing sector that is completely free of government subsidy,
    and it is ROARING!

    askeptic (2bb434)

  20. JD–Don’t know who you are. If your remark is directed to me, please be specific.

    Then at least I can make something of your rudeness that would be of some benefit to the same audience as this comment thread (i.e. the whole of the internet).

    The comment board is not threaded so we must make do with what we have.

    deignan (7f26a5)

  21. No offense Brits, but Atlanta would do a lot better:

    http://www.bbc.co.uk/news/uk-21106626#

    gary gulrud (dd7d4e)

  22. 20. FO Dink. Don’t come back.

    gary gulrud (dd7d4e)

  23. especially the young, who have been educated to believe in social justice

    DRJ, the amount of leftism in this society isn’t quite as extreme or pernicious as what’s going on in Europe. But it’s merely a matter of degree and, most importantly (and in light of your mentioning the young, meaning the next generation), of time.

    I know that personally I’ve become more desensitized over the past 20 years, so what would have have been totally unacceptable and unthinkable to me in the past now seems increasingly par for the course. IOW, I think we’ve all been dumbed down to varying degrees or increasingly shock-proof in this era of I’m-okay-you’re-okay. From that, various forms of corruption can easily begin to take hold and fester.

    he focuses merely on Europe and Latin America, Australia shows some of the same aspects

    Narciso, I’d lump Australia together with the “Western World,” since that is where most of that country’s populace and history originate from. I know that a few years ago they voted out of office a perfectly reasonable center-right prime minister (similar to Canada’s current PM — meaning rather squishy by my standards — but apparently controversial because he didn’t want to slobber over global-warming fanatics) — and in spite of his country doing rather well economically and culturally — and was replaced by a garden-variety liberal/leftist.

    Meanwhile, Japan took a similar turn to the left around the same time we in the US fell off the deep end in 2008. But they, unlike us, regained some sanity in their recent election.

    Mark (e66007)

  24. Deignan

    Contact Mandy, Pat reply or non reply isnt an issue – simply choose to donate or go away

    EPWJ (c5f1fc)

  25. Deignan – if you aren’t, my sincere apologies that my profound rudeness offended you so. The post in question linked to hers, and our host spoke to his feelings about her and her condition.

    JD (b63a52)

  26. 24 Friend,

    For $20, no problem. A tip in the tip jar just like the bum you meet at the corner.

    For $2000, I don’t chase after people to make donations.

    A person that puts their name behind a cause should in my opinion, stand for its solution. Otherwise, don’t bother. There are many good causes in the world. We do not make personal appeals for theor solution.

    If one does not care so much, then it is good that we know this as well. Maybe we should not care either. Remember how much money of donations for the united way went for overhead?

    If you insist on closing the loop as I do, you can at least save others from making a mistake in misplaced charity. We all have only so much to go around.

    Now,#20. Gary, Gary from Minnestota, is that you? I am sure we have at least 10 common contacts just two degrees of seperation between us.

    Yes, Gary, winters are cold in Minnesota, and we tend to get cabin fever. Probably you have not seen enough sun recently.

    Feel free to send me a private message when you feel so out of sorts. I also am easily found. Here, you have not made a good presentation for my good friends in Oakdale-not so far from Cottage Grove and Prescott.

    deignan (7f26a5)

  27. 26. “2 degrees of separation”

    Don’t chase people to give them $2000? Not that I’m cut from their cloth, I have numerous relations and acquaintences who’ve given their lives to give Life, including a neighbor couple shot dead by the ‘Lord’s Army’ in Uganda.

    You’re a transparent liar.

    gary gulrud (dd7d4e)

  28. Paul Deignan got his comments deleted last time, posting under Pasha, then PashaG. Same passive aggressive nonsense.

    If you really wanted to donate $2000, you would have clicked on the link and done so. You would have brought up this subject in the thread devoted to the subject.

    JD (b63a52)

  29. deignan

    then just tell your friend to contact me.

    However if you think this is fke well, then don’t bother, all of us here donated – we are not idiots

    EPWJ (c5f1fc)

  30. you have to insist on closing the loop

    close the loop for the children close the loop for a better tomorrow

    happyfeet (ce327d)

  31. close the loop for freedom!

    happyfeet (ce327d)

  32. I passed along the email to Mandy today, and she can respond as she sees fit. I did not respond because the email did not ask for a response; it suggested I could pass it along as *I* see fit. Why I am the middleman in this equation, I’m not sure.

    Patterico (e576fc)

  33. deignan just needs some love and attention, but mostly attention.

    daleyrocks (bf33e9)

  34. deignan made a good point about the sunshines I don’t know how you winter people do it

    I aspire to find out one day though, but I’m only committing to one winter, just so I can say I did it

    happyfeet (ce327d)

  35. 34. 270 overcast days per year, what’s not to love?

    http://www.kare11.com/weather/default.aspx

    Roughly -5 at the moment with a wind too. Nasty being the gofer.

    But our springs are a leetle bit of heaven.

    Bobbing a mile from shore in 76 degree water swimming off a ‘tube’ with the squirt tastes of God at His pretty much marvelous best.

    gary gulrud (dd7d4e)

  36. Senate Democrats, while bristling at the demand for a budget

    THOSE GOP *bastards* !!!

    How DARE they!?!?

    Smock Puppet, 10th Dan Snark Master and Labeler of the Obama-Naut (98ae1f)

  37. Heh. Indeed, Republicans are SO awful, huh?

    At least if you ask the scum in Big Media.

    Patterico (8b3905)

  38. Stuff like Obama, Schumer, and Illinois’ Dick Dirtbag you just flush down the commocde.

    PCD (1d8b6d)

  39. If the consensus is we have a stupid electorate, I think it’s only fair that we define who we’re talking about. I don’t blame the voters in the 24 red states. I blame the voters in the blue states.

    DRJ (a83b8b)

  40. I don’t think we should be using the debt ceiling as a negotiation point, because I think Obama would love to play hardball on that, and I think it makes more sense for us to play hardball on the budget than the debt ceiling. I think requiring the Senate to pass a budget makes sense;

    So they did exactly the right thing, according to you, and certainly something that is better strategy. Yes, they backed down, sort of, but it is not a caving in. They came up with this in their retreat.

    The situation was the debt limit would be reached between about February 15 and March 1.

    [Feb 15 was projected earlier as a possible drop dead date because it has $30 billion in interest payments due that day and $6.8 billion in tax refunds (as well as $3.5 billion in salaries, $2.7 billion in military pay $2.3 billion in Medicaid and Medicare payments $1.5 billion in payments to military contractors) and only $9 billion or so coming in that day.

    But because the tax filing season started later, and the accumulated tax refunds sent out may be less than originally projected, you might be able to go past Feb 15. And the Treasury could just freeze all tax refunds till the debt limit is raised..]

    On March 1 comes the sequester, and the continuing resolution runs out on March 27.

    The Republicans decided to make the debt ceiling last, by extending it a certain amount so that it would run out after three months, or somewhere around May 15 to 31. It would be an almost clean debt limit extension. It would only have one little twist: If the Senate or the House didn’t pass a budget resolution, by April 15 – in the middle of this extension – their salaries would be withheld. This is common in many states. There are some claims this might be unconstitutional, as the 27th amendment (sent to the states in 1789, ratified in 1992) says pay of members of Congress cannot be “varied” between elections, and that means both down and up, but the consensus is since they get their pay anyway – it’s just withheld – that would be all right – although I suppose budget or no budget they’d have to get paid by December 31. Or maybe not but then they’d be i a higher ax bracket in 2014.

    Senator Schumer seems to indicate the Democrats have caved in on this – he says there will be a budget resolution by April 15, so the Republicans win the point.

    but Democrats have to be honest about spending.

    …and on taxes. The House budget resolution will call for tax reform that is neutral from this point on – the Senate resolution will probably call for tax increases.

    This doesn’t get the Republicans a victory – it just gets you to a clear fight over the budget resolution. But only 51 votes are needed in the Senate. There’s the opportunity to amend Obamacare, make some moves to changing Medicare and so on. It may not get 51 votes.

    Sammy Finkelman (b74417)

  41. Senate Democrats, while bristling at the demand for a budget

    Seem about to be ready to cave in on that.

    Sammy Finkelman (b74417)

  42. The voters are not stupid.

    There might possibly be an argument for making Social Security in part defined contribution, rather than defined benefit, but there’s no honest argument for keeping it defined benefit but lowering the benefits.

    Sammy Finkelman (b74417)

  43. Regarding stupid voters:

    Ken Burns isn’t stupid but, prior to the 2012 election, he repeated the claims made by the Obama campaign and the media concerning Romney, Bush and the economy. Ultimately it’s the voters’ responsibility to be informed but stories like this make me think our partisan media (as much as the voters) is to blame for Obama’s re-election.

    DRJ (a83b8b)

  44. DRJ – do you attribute that to ignorance or partisanship?

    JD (b63a52)

  45. The voters are not stupid.

    I wouldn’t say that about the ones who perceive modern-day liberalism and, in turn, politicians identified with left-leaning biases, as being such a humane, generous, compassionate, tolerant, wise, noble and sophisticated facet of human existence.

    Mark (e66007)


Powered by WordPress.

Page loaded in: 0.3385 secs.