A recent NYTimes article details President Barack Obama’s determination to bring truth and transparency to our nation’s budget. For his first annual budget next week, President Obama has banned four accounting gimmicks that President George W. Bush used to make deficit projections look smaller. The price of more honest bookkeeping: A budget that is $2.7 trillion deeper in the red over the next decade than it would otherwise appear, according to administration officials. Eeek! Well, at least we know where the starting point is going to be.
The new accounting involves spending on the wars in Iraq and Afghanistan, Medicare reimbursements to physicians and the cost of disaster responses. But the biggest adjustment will deal with revenues from the alternative minimum tax, a parallel tax system enacted in 1969 to prevent the wealthy from using tax shelters to avoid paying any income tax.
Mr. Obama’s banishment of the gimmicks, which have been widely criticized, is in keeping with his promise to run a more transparent government.
“The president prefers to tell the truth,” he said, “rather than make the numbers look better by pretending.” —Peter R. Orszag, Director of the Office of Management and Budget
Some other details worth noting:
President Bush never included the costs of his wars in the Budget. He would routinely ask Congress for supplemental appropriations during the year. For Medicare, Mr. Bush routinely budgeted less than actual costs for payments to physicians, although he and Congress regularly waived a law mandating the lower reimbursements for fear that doctors would quit serving beneficiaries in protest. Mr. Obama will budget $401 billion over 10 years for higher costs and interest on the debt. He will also budget $273 billion in that period for natural disasters. Every year the government pays billions for disaster relief, but presidents and lawmakers have long ignored budget reformers’ calls for a contingency account to reflect that certainty.
Making government responsible and transparent? What a welcome concept! Nice Job, Mr. President!
I am so excited! Is this going to be as “Transparent” as the Promise to post the Stimulous bill online for 48 Hours before being voted on? And then passing it before even congress could read it?
“Mr. Obama’s banishment of the gimmicks, which have been widely criticized, is in keeping with his promise to run a more transparent government.” Please explain these “Gimmicks” and will the Social Security Trust fund be one of them? Such as the AMT? this can hit people at 100,000K is that rich? Are you saying we dont have Enough Taxes?
So, the trick is to pretend like cutting taxes for people who don’t pay them isn’t welfare and raising capital gains on 100 million people who own stocks isn’t taxing the middle class.
That way, the “tax cut” comes to you like a check from the government instead of more of what you earn.
The real kicker will come down the road. Under Obama the “tax credits are phased out as income rises, they impose a huge marginal tax rate on low-income workers”. Down the road familes “with an income for $40,000 could lose up to 40 cents in vanishing credits for every additional dollar earned from working overtime or taking a new job.” This then begs the question, why would you work overtime or take a new job?
There’s your stimulation!
Good rope a dope Vixen.
Red, it’s painfully obvious that the reactionaries (1. and 2.) neither read, nor care to read your post. Their comments bring to mind some one with their fingers in their ears, eyes shut and chanting gibberish.
“The recipe for perpetual ignorance is: Be satisfied with your opinions and content with your knowledge.”
Elbert Hubbard
It’s really a welcome concept if his determination for transparency will push through. But we don’t know yet what part of accounting or of the financial statement will he disclose to the public.
Excellent post. Responders 1 and 2 seem to want to play the “oh yeah, but—” game and ignore the main point of the post which is – getting all costs of government out on the table at the same time so a bottom line total can be seen.
Our economy is in the toilet because of years of spending, borrowing/lending beyond our means, from individuals taking out loans they knew they could not repay, to banks lending with a wink and nod and not checking the applicant’s claimed income to, yes, government borrowing more than they would admit by putting major expenditures “off budget”.
Be prepared for a shock folks when you get to see how much the deficit really is and has been.
I am in agreement that we have a HUGE Deficit! I don’t doubt that one bit, Spending has been out of controll for years. and it started when Bush got into office! Forget the War waht about Medicae entitilements, No child, and all of the other liberal programs.
Now, the term reactionary is a favorite of the Socailist elit, I learned it about 25 years ago in the 8th grade, it really make no sense, seriously, look it up. You sound like a moron when you use it.
So now,in my post I asked, based on his own actions, will it be transparent like the Stimulous bill was? A promise to post it on line for 48 hours which was broken? That is not listening? or reading? and then I asked if getting rid of the AMT was in the plan and a good idea? How does that make me a reactionary? Whatever that is.
Why can’t you ansewer questions without name calling? you are all tied into this I Hate Bush, and Love Obama Circle Jerk, that you start name calling as soon as somebody questions your “brilliant wisdom”
For the record. I voted for Bush the 1st time, and that was it
BigMarkod,
Were you able to read my post? I clearly outlined the 4 corrections to the budget that Obama will implement. I believe that the “48 hours” breach of trust was an urban legend and was found to be untrue – it was actually a working document on PDF that our reps had access to and also WE had access to during the entire budget process. If you could provide a link supporting your rumor, that would be helpful.
Terry, your projecting into the future isn’t really helpful or even grounded in reality. It is akin to La-La speculation. I notice that you didn’t comment on the sleight of hand that past administrations have done when it comes to funding a war “outside” the national budget. I also notice that you didn’t comment on the dishonesty embedded in the Medicare system that so many people rely on. Bush I called the federal budget “voodoo economics” and finally we have a president who is willing to address it, fix it and make government accountable for spending on its biggest projects.
#3 anonster,
Good morning! I agree with you completely. It is sad to think that our new president comes along with attempts to put honest accounting into a completely run-away system of financial muck and it is greeted by Obstructionist thinking. Thank God that party is now out of power. The GOP keeps creating irrelevancy for their party. We need big thinkers right now to solve our problems. We can show the rest of the world how it is done. Let’s face it – there is a GLOBAL ECONOMIC CRISIS going on that needs the leader of the free world to set the course for recovery. I think the US is up to the task!
BTW, I clicked on your moniker here thinking that you had a blog of your own, and it was a reference to our OJ here. Are you possibly interested in doing some original posts here at OJ? I’d love to read and comment on what you find interesting going on in current events. Just an idea – Art’s pretty easy to work with 😉
Phil,
Welcome to the Orange Juice! You bring up a point that concerns me as well regarding transparency.
I sent off a note to the Obama website asking for a link to the pages where the stimulus spending is supposed to be recorded and updated. Here is the general overview of the program from the Office of Management and Budget. If you are a fan of accounting and accountability, you might find the 62 page document of some interest:
http://www.whitehouse.gov/omb/assets/memoranda_fy2009/m09-10.pdf
Again, welcome!
Olderthan,
Excellent remarks.
‘Be prepared for a shock folks when you get to see how much the deficit really is and has been.’
I think it was projected to be 2.7 trillion dollars higher. Personally, I was surprised to find out that war funding is OUTSIDE the federal budget. It does make sense, because there is no way that an expensive military project could just be “fit in” to a regular budget.
The past lack of accounting in the federal budget seems to be more the thinking of an addict or a thief – where there is no self-discipline or even attempt to justify spending vs. income. NONE of us would be allowed to get away with that kind of irresponsible budget for long. We’d wind up in the streets or we’d wind up in jail for that same kind of unbridled spending nonsense.
Here is a link to the government site explaining the upcoming most broad and most quick tax cut ever:
http://www.whitehouse.gov/blog/09/02/20/The-quickest-and-broadest-tax-cut-ever/
Bigmarkod; this from Answers.com:
reactionary n. pl. ar ies; An opponent of progress or liberalism, an extreme conservative
I think your knee jerk reactions to all things “liberal” qualifies you as a reactionary.
As to your NOT reading Red’s post, you ask “Please explain these gimmicks?” well, her entire post explained “what gimmicks”. Don’t blame me if your “reactionary” reflexes cut off the blood supply to your brain.
Red, thank you for your kind remarks. As to doing original posts, I will think about it, although my computer skills are rudimentary, to say the least.
Red, thank you for your kind remarks. As to doing original posts, I will think about it, although my computer skills are rudimentary, to say the least.
anonster,
Your ideas are clear and you present your opinions well. If it is just a matter of computer skills, then please consider doing a post and email it to me and I will get it posted up for you: rvixen@gmail.com
No pressure at all… however it certainly would be nice to have some more progressive company around here. The GOP influence tends to get a bit overpowering, if you know what i mean. lol!
I think you’d be a nice addition, if you’d like to try it out. –Rv
Vixen
You are right, I said nothing about the past Presidencies. I prefer to address the here and now.
“finally we have a president who is willing to address it, fix it and make government accountable for spending on its biggest projects.”
I will simply wait for time to reveal your la-la speculations all on their own. I dont have to make it personal and address them myself.
The obstructionists who continue to address themselves as the sole arbiters of “good intentions” will be showed for who they are, in good time.
You are right, I said nothing about the past Presidencies. I prefer to address the here and now.
Terry,
Just gonna give them a pass? Well, you are more tolerant than I am. Obama promised more transparency and more accountability in government. I am not sure what to make of all the stimulus package and other plans that seem to be developing. However, I expect that he will keep his word on making government more responsible. Cleaning up the budget so that it makes sense is a good first move towards greater accountability.
Maybe you’re a big war supporter and it doesnt make any difference to you at all how much has been squandered overseas, but I don’t like that kind of waste in treasure OR lives. Having the military included in the budget is a good idea – it will make us more aware of what battles we SHOULD fight and which unnecessary wars we can avoid.
anonster, sorry but I am a Classic Liberal. I oppose government regulations, and I oppose spending and reuglation, by the Federal government on things that are not directed in the Constitution. So No Money for
Welfare,(Fed)
Unemployment (Fed)
Education (Fed)
Social Security
Big Standing Army (Fed)
Highways (Fed)
What people put into their body
What people do with their body
What people Smoke, drink etc
Corporate, CAr, Bank, etc Bailouts
If I wear a helmet, seatbelt, smoke, child seat etc
It is my understanding you would llike these, so you are opposed to Classic Liberalism…that makes you a reactionary!Sticks and stones, sunshine, sticks and stones
P.S. Seriously, you all need to slow daon, before spewing hate! My first question was really a question! I just want to know if President Obama, wants to get rid of the AMT, or if he wants to expand it?
Bigmarkod; Ooooh,the 1820 definition of a liberal, how relevant.
Interesting comments….
In the mean time, I just came across two helpful articles on 2008 taxes.
http://www.recessioninfocenter.com/2008_tax_tips_for_recession.html
http://www.recessioninfocenter.com/Taxes_in_recession.html