The ratio of spending cuts to tax increases in the President’s budget

Keith Hennessey Blog ^ | 2/13/2012 | Keith Hennessey

[PhxRising]

The Obama Administration claims their new budget contains $2.50 of spending cuts for every $1 of tax increases. Their 2.5:1 ratio is bogus. The President’s team is (1) playing a timeframe game and (2) counting interest savings from tax increases as spending cuts.

The President’s team is playing at least two games to generate their 2.5:1 ratio:

They are cherry-picking their timeframe to make the ratio look at high as possible; and They are counting all interest savings as spending cuts. Why did they start measuring in January 2011? Because that was the start of the Republican Congress, because last year only spending cuts were enacted, and because that timeframe maximizes the spending increase to tax cut ratio.

The right way to measure this ratio is therefore to exclude the interest effects and to measure only the ratio of deficit effects of proposed policy changes. The Administration counts interest savings from tax increases as spending cuts to inflate their ratio.

[PhxRising]

Surprise, surprise, surprise, Obama lied!

[Let_It_Be_So]

“Surprise, surprise, surprise, Obama lied!”

Ooooh, you’ve done it now! Samuel T. Jackson is not going to like you calling Obama a liar, you know. He’s going to call you a racist rube if you don’t watch it.

Maybe there’s still time to ask the moderator to scrub your post. :)