Smoke and mirrors

by Russ Roberts on July 15, 2011

in Budget Issues

The focus on the size of the spending cuts is a red herring.

What matters is spending.

According to Paul Ryan:

The President’s proposing we spend $46 trillion over the next ten years. With the debt limit increase, we’re saying ‘let’s spend 43 and a half.’ That’s not asking a lot over a 10 year period. And it will be a small down payment on what will be necessary to prevent a debt crisis. And the President won’t even do that.

Is Paul Ryan right? Is the President really proposing to spend FORTY SIX TRILLION DOLLARS OVER THE NEXT TEN YEARS? I don’t know. Haven’t seen that number before which either tells you a lot about Paul Ryan or how easy it is for politicians to manipulate us.

The federal government spent $3.5 trillion in 2010. That’s up from $2.5 trillion in 2005. Going to $4.3 trillion (43 trillion over ten years) IS NOT A CUT.

Paul Krugman writes in yesterday’s Times:

President Obama has made it clear that he’s willing to sign on to a deficit-reduction deal that consists overwhelmingly of spending cuts, and includes draconian cuts in key social programs, up to and including a rise in the age of Medicare eligibility. These are extraordinary concessions.

Draconian? Where? Either Krugman or Ryan is wrong. And the debate is all theater.


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