The Greatest Sequester Lie of All: We’ve Already Saved $84 Billion!

Daily Beast ^ | 02/27/2013 | Daniel Gross

[Responsibility2nd]

The sequester is rapidly approaching. If no one stops it, we’ll experience automatic and devastating spending cuts of $84 billion between now and this fall.

There are many insane things about this, but one in particular strikes me as ludicrous beyond comprehension: the deficit has already shrunk by $84 billion so far this fiscal year.

Get it? The whole point of the sequester was to cut the deficit—meaning the difference between what the government makes in taxes and what it spends. Yet through natural forces, the deficit has already been cut by essentially the same amount the sequester would cut.

Why everyone—the president, Congress, the commentariat—is ignoring this blinding truth is beyond me. What I do know, is how we got to this place. And it’s important to understanding the lie behind the sequester, and the actual economic forces at work.

When the sequester was set in motion in the summer of 2011, the government was about to complete its second straight fiscal year with a $1.3 trillion deficit.

~snip~

Consider this. We’ve had sustained, significant job growth for nearly three years. In January 2013, there were 2.06 million more people with payroll jobs than in January 2012, according to the Bureau of Labor Statistics. That’s more people working, at slightly higher wages, and paying taxes at higher rates. What do you get? More money.

Check out the Treasury Monthly Statement for January. Through the first four months of fiscal 2013 the government has collected $468 billion in individual income taxes, up 15.8 percent from $404 billion in the first four months of fiscal 2012.

[Responsibility2nd]

Also FTA: All told, we’ve seen $86 billion of deficit reduction in the first four months of fiscal 2013—which is almost exactly the amount the sequester hopes to achieve.

[lurk]

We will still have a yearly deficit well over 1 trillion. A reduction of $85B is like a morbidly obese person losing a few ounces.

Everyone in Washington deserves a punch in the head for their cowardice, selfishness and corruption. And then one in the head for the voters who put them there.

[kabar]

Deficit reduction thru tax increases. 2013 will see $2.7 trillion in revenue, the highest in history. However, spending from the entitlement programs and other mandatories is also increasing.

The biggest factor in deficit reduction is the CR. Government spending on the discretionary part of the budget has essentially been frozen for almost two years.

We need to cut spending by more than $84 billion a year.

[circlecity]

If you are falling slightly slower now than you were a few minutes ago it doesn’t mean you are now flying.

[thesharkboy]

A reduction of $85B is like a morbidly obese person losing a few ounces.

I like to think of it as a morbidly obese person getting a haircut.

[Vince Ferrer]

And how many planes have fallen out of the sky because of this?

[Gandalf_The_Gray]

Consider this. We’ve had sustained, significant job growth for nearly three years. In January 2013, there were 2.06 million more people with payroll jobs than in January 2012, according to the Bureau of Labor Statistics. That’s more people working, at slightly higher wages, and paying taxes at higher rates. What do you get? More money.

Check out the Treasury Monthly Statement for January. Through the first four months of fiscal 2013 the government has collected $468 billion in individual income taxes, up 15.8 percent from $404 billion in the first four months of fiscal 2012.

If I read that correctly, Obama is a freaking genius! He creates new jobs by the millions by hiring new government drones. He pays them well beyond the private pay scale. Then taxes their income, creating a new revenue stream, which he claims is reducing the deficit!

Sheer genius! I guess it's true, we can get rich by "taking in each others laundry."

I'm sure he's considering using the "extra" revenue to hire even more government employees, thereby reducing the deficit further still. As the Red Queen said to Alice "you see, it takes all the running you can do, to keep in the same place", in this case approaching the swirling drain...

Regards,
GtG

[V_TWIN]

“And how many planes have fallen out of the sky because of this?”

Maybe none but with all due respect, as a DoD employee that directly supports the US Navy and USAF warfighter I can tell you there will be less military jets in the sky (around the world) because of it.

[Secret Agent Man]

...or still not falling. the splat is still forthcoming.

[Zuben Elgenubi]

General Motors still owes the government $25B from the original $50B in TARP funds. How about getting GM to pay that $25B back.

$25B is about 30% of the $85B sequester.

[Blackirish]

Anemic,weak, sporadic, low paying job growth....fixed it. The whole were finally turning the corner has been magical thinking. Remember recovery summer?

160,000 or so jobs a month sucks. We have less people in tHe work force then when the one took office. Besides the evil oil companies and the Federal government no one is hiring.

[DustyMoment]

The Greatest Sequester Lie of All: We’ve Already Saved $84 Billion!

Does this mean that zero or his husband won't take any more "vacations" for the neaxt 4 years!??

[Henri Gaudier-Brzeska]

I know this way of showing what kind of % cuts we’re talking about has been used but I think it’s worth presenting again.

I’ve been saying for years that most people don’t understand what a trillion dollars is and what our actual financial condition is as it relates to the debt and projected budget cuts or fiscal cliff.

What I’ve done is removed all those nasty 0s, eight in all and put the situation in terms that the average person can relate to.

The following is what we’re up against. Imagine if this was your family budget, doesn’t make much sense does it?

Money earned (tax revenues) $21,700
Money spent (Federal Budget) $38,200
Money borrowed this year to make ends meet $16,500
Money owed on credit cards (Federal Debt) $164,710
Money agreed to be saved to pay back debt $38.50

[Tublecane]

Boo-hoo.

[Vendome]

Through the first four months of fiscal 2013 the government has collected $468 billion in individual income taxes......

Brilliant!!!!!

Whut wonderful reporting

Idiot Savante

[youngidiot]

Our spending has grown a hell of a lot more than $85 billion per year under Obama. Where were we $85 Billion ago? Were we laying off teachers and soldiers and letting illegals go? They're doing this to teach us a lesson. They're going to make damn sure this $85 Billion cut hurts bad, much worse than it has to - so that next time we want to reduce the size of this monstrous government they can say, "Look what happen last time!" This is a fraud. They need to be called out on it.