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View Diary: Boehner just shot himself in the foot (170 comments)

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  •  Your analogy doesn't make sense (1+ / 0-)
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    pat bunny

    We seem to be using differentials when defining "tax cuts" or tax increases.  That is, if the tax rate is lower than it was last year, it's a tax cut.  So why isn't the same definition used for spending cuts?

    You say:

    It's like saying, "I could have spent $100,000 that I don't have on a sports car, but since I'm not going to, I've cut spending by $100,000."

    No. Not the same. Because I haven't been spending $100,000 a year on sports cars in the past.  But we have been spending money on wars in the past.  So if spending on useless wars next year is less than it was this year, I don't see why that's not called a spending cut.

    Accounting "gimmicks" are things like pretending money I've spent/earned this year was really spent/earned in a different year or averaged out over a ten year period or whatever.  Or that gifts my children have received from me aren't really income.  Or that things aren't really income if they're passed through a certain kind of trust. Or lots of the other things the tax code provides to let rich people not pay taxes on things that they do that the rest of us would normally pay taxes on.  In short, legal fictions.

    If we were spending a trillion dollars on a useless war and now we're not, that's a cut.

    •  It's a matter of what baseline you start from (1+ / 0-)
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      VClib

      to say whether you are "cutting."

      For FY 2013 - 2023, it makes no sense to say that the "baseline" includes spending for Iraq and Afghanistan, because current policy is that we will not be in Iraq and Afghanistan during those years.  That's the problem.  What is the baseline -- what will happen if all the policies that are in place now continue?  That baseline does not include Iraq and Afghanistan.  In order to say you are cutting spending based on Iraq and Afghanistan, you have to assume that the baseline would be continuing that war spending in FY 2013 - 2023.  

      For example, what is the baseline on revenues for next year?  If you assume that under existing law, all Bush tax cuts expire, then a plan that continues them for households under $250,000 is a cut in tax revenues.  But if you assume that the baseline is what we have today -- all those tax cuts in place -- then the very same legislation, extending the Bush Tax cuts on Households under $250,000  -- is an increase in  tax revenues.

      For political reasons, people tend to pick the baseline that supports their preferred narrative.  When people in Washington play with numbers, they fool around with the baseline more than anything else.  It's what allows two groups to look at the same thing and one say they "cut spending" and one say they "increased spending."   They both are telling the truth because they are starting from different baselines.  

      •  The baseline is what we were doing before (2+ / 0-)
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        lostinamerica, pat bunny

        That's what is meant when you're not trying to redefine "cut" in some bizarre way.

        If I "lost" weight, it means that I weigh less than I did last year.  Not that I weigh less than some "baseline" based on some "policy".  That's how my investment people define my gains and losses in stocks or mutual funds.

        I'm a math nerd, and that's how you define what a change is.  DeltaY where y = f(x) means f(x+deltaX) - f(x).  If x is this year, and if deltaX is a year, then it's f(nextYear) - f(thisYear).  None of this "policy" and "baseline" stuff.

        •  That works when you are comparing one year (1+ / 0-)
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          VClib

          to the year before.  It doesn't work when you are talking about projecting cuts in spending for the next 10 years, which is how our government does budgeting.  In order to do that, you have to have a "baseline" for the next 10 years -- what spending would have been.  Then reductions from what spending would have been are your cuts.  

          •  That's what it is everywhere else. (1+ / 0-)
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            lostinamerica

            When they talk about NASA budget cuts, they mean it's cut with respect to last year, not with respect to a 10-year NASA baseline that was projected.

            That's how it is everywhere else in business, too.  When I got a salary increase of 3%, it was called a salary increase of 3%, not a salary cut of 1% even if some policy forecast said that over 10 years I should be getting an average 4% increase per year.  Calling it an increase wasn't a "gimmick"; it was the normal way of describing the event.

            •  I wish the terms everyone used were the (1+ / 0-)
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              coffeetalk

              same for government spending and executive compensation. It would be nice if the word "cut" was reserved only for actual, real dollar reductions where Year B spending was actually lower than Year A. The problem with the word "cut" as it relates to federal budget issues is that no one knows what it actually refers to. In addition, "budget cuts" for any year past the next two are complete fiction. The current Congress can't dictate anything past the 113th session.  

              "let's talk about that"

              by VClib on Sun Dec 02, 2012 at 09:15:49 PM PST

              [ Parent ]

      •  I believe the CBO's budget numbers have already (0+ / 0-)

        baked in the Iraq war ending and a reduced presence in Afghanistan. The CBOs budget also has ALL the Bush tax cuts expiring at the end of the 2012.

        "let's talk about that"

        by VClib on Sun Dec 02, 2012 at 09:19:43 PM PST

        [ Parent ]

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