- "Laws are made for men of ordinary understanding and should, therefore, be construed by the ordinary rules of common sense. Their meaning is not to be sought for in metaphysical subtleties which may make anything mean everything or nothing at pleasure." --Thomas Jefferson to William Johnson, 1823.
- "Common sense [is] the foundation of all authorities, of the laws themselves, and of their construction." --Thomas Jefferson: Batture at New Orleans, 1812.
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- "The whole aim of practical politics is to keep the populace alarmed (and hence clamorous to be led to safety) by menacing it with an endless series of hobgoblins, all of them imaginary." -- H.L. Mencken 'Nuff said."The government consists of a gang of men exactly like you and me. They have, taking one with another, no special talent for the business of government; they have only a talent for getting and holding office. Their principal device to that end is to search out groups who pant and pine for something they can’t get and to promise to give it to them. Nine times out of ten that promise is worth nothing. The tenth time it is made good by looting A to satisfy B. In other words, government is a broker in pillage, and every election is sort of an advance auction sale of stolen goods."
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- I say, the earth belongs to each of these generations during its course, fully and in its own right. The second generation receives it clear of the debts and incumbrances of the first, the third of the second, and so on. For if the first could charge it with a debt, then the earth would belong to the dead and not to the living generation. Then, no generation can contract debts greater than may be paid during the course of its own existence. - Letter to James Madison (6 September 1789) Thomas Jefferson
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Washington Matters
The Procedural Rule That Keeps the Senate Tied in Knots
No matter who wins the 2012 presidential election, the minority party can thwart his agenda.By Richard Sammon, Senior Associate Editor, The Kiplinger Letter
May 30, 2012
ADVERTISEMENT
A single sentence in the rules of the Senate stands between whoever is in the White House next year and his chances of enacting the agenda that got him there.The rule, which requires 60 votes to cut off debate and force a vote, has been a roadblock for presidents since it was adopted in 1917. But its use has ballooned. From 1917 until the end of 1960, votes to try to end debates were taken just 23 times. Since 2001, however, the rule has been invoked 416 times (in 230 cases, the 60-vote threshold was met, clearing the way for a vote on the bill in question).The growing use of the rule is accompanied by increased calls for scuttling it. Republicans, who control the House, are especially frustrated now because Democrats in charge of the Senate have relied on the 60-vote standard to keep the GOP at bay. Republicans in the Senate have, of course, used it just as effectively to keep Majority Leader Harry Reid's Democrats in check.But the chances of undoing the rule? Nearly zero. Lawmakers from both parties know that any stay in the majority is short-lived, so those now in power -- the Democrats -- won't agree to ditch the filibuster because someday they'll be in the minority and will want to use it.It will be similarly tough to merely soften the filibuster rule, though some senators would love to try. The Senate is Washington's most tradition-bound institution, and changing the rules there is intentionally difficult. The last change, in 1975, reduced the required number of votes to end debate from 67 to 60.So the filibuster will survive. Big parts of the president's agenda will not. It doesn't matter whether President Obama wins another term or Mitt Romney replaces him. And it doesn't matter which party holds the majority in the Senate. The 100-member body will still be closely divided and polarized.Look for heavy use of the filibuster next year to slow work on tax reform, energy policy, deficit reduction, entitlement reform and budget changes, as well as to hinder efforts to retool existing laws on health care and oversight of financial markets.The founding fathers modeled the upper chamber on the Senate of ancient Rome, as a deliberative body removed from the pulse and temper of the common people. Though it was not called a filibuster at the time, one of the first users of the technique was Cato the Younger, an adversary of Julius Caesar.According to The Senate of the Roman Republic, by the late Sen. Robert C. Byrd (D-WV), one rule was that no business could be conducted after dusk. That gave Cato an opening. Near dusk, Cato would take the floor and speak until nightfall, sometimes reciting epic poems, thereby preventing business from being transacted. In doing so, he thwarted some of Caesar's wishes.Today, of course, many Americans know about Caesar. Cato the Younger, on the other hand, is little more than an asterisk in history.The filibuster, though, lives on, much to the dismay of a long line of residents of 1600 Pennsylvania Avenue, to the delight of the underdog party of the moment in the Senate, and to the confusion of nearly everyone else schooled in another long-standing tradition -- majority rule.
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This is for all you doubters and those of you on the fence. Surprise the 2009 deficit was not caused by the Republicans or Bush policies. The Republicans tried to reform Social Security and medicare but the Democrats shot down all of the Bush ideas. This will shock you and you will not see it talked about in very many publications.
September 11, 2010
Two Years That Changed the World
By Randall Hoven
(Part II of a series. Part I was "The Good Old Days.")
The 2009 federal deficit was $1.413 trillion dollars, the largest in history. In fact, it was triple the 2008 deficit, which was the largest in history up until then. Even as a fraction of GDP, it was the largest ever in peacetime. What caused such a deficit? Was it tax cuts? Was it war? Was it bailouts?
How, exactly, did Bush pull it off?
The tricky part about answering such questions is that all we know is what happened. We do not know what would have happened had we done something different. So we have to guess. That is, if you blame a tax cut, you have to guess what federal revenue would
have been without that tax cut. Then the difference between that guess
and the actual revenue is what you blame on the tax cut.
Key word: guess.
Bush-bashers like to guess (figure below). They like to guess, for example, that revenues would have been larger than they'd ever been in history as a fraction of GDP
if Bush hadn't cut the top marginal rate from 39.6% to 35%.
Source: Ezra Klein, The Washington Post.
Here is how I am going to guess: I will use 2007 as a baseline year, and then see what the differences were between 2007 and 2009. (For more on
FY 2007 and the years just preceding it, see Part I, "The Good Old
Days.")
This is reasonable for several reasons. First, 2007 was about "normal" in terms of economic activity, federal budget, and debt, with good trends
in all of those areas. (Unless otherwise stated, a "year" here is the
fiscal year October through September, since that is the way the
government keeps its books.)
Secondly, there were no huge policy changes in 2007 or the years just preceding it. The Bush tax cuts took effect several years before, in 2001 and
2003. The Afghanistan and Iraq wars had been ongoing for years. If the
tax cuts and wars caused bad deficits, 2007 should have seen a bad
deficit.
Third, 2007 and 2009 were not that far apart. One would think that significant differences in budgets between two such close years could be attributed
to real differences in events or policies between those two years. That
is, we should look for "blame" in the areas where those years differ
(e.g., recession, bailouts, stimuli) and not where they don't (e.g., tax
rates, war on terror).
Fourth, and perhaps most importantly, this method does not require exotic mathematical models to predict the would-have-beens. In effect, I'm
using 2007 as what 2009 would have been, everything else equal. In this way, we compare actual counted dollars, not macroeconomic models and equations.
So how do those two years compare? The tables below list the primary federal budget numbers.
GDP and Federal Budget in Then-Year Dollars ($Billions)
FY 2007
FY 2009
GDP
13,896
14,237
Federal Revenues
2,568
2,105
Federal Outlays
2,729
3,518
Deficit
161
1,413
Federal Budget as Percentage of GDP
FY 2007
FY 2009
Federal Revenues
18.5%
14.8%
Federal Outlays
19.6
24.7
Deficit
1.2
9.9
Source: OMB.
In raw numbers, revenue fell $463B from 2007 to 2009 and outlays grew $789B, causing an "extra" $1,252B of deficit. It was mostly extra
spending, but not all. As percentages of GDP, revenue fell by 3.7% of
GDP and outlays grew by 5.1% of GDP.
Now here is where I will introduce a "model" of sorts. My model says we should expect two fiscal years so close together to have roughly equal
revenues and outlays as percentages of GDP, everything else equal.
Why is that reasonable? Because that had been the case for the past half-century. (For the statistically inclined, the linear regression
estimates of revenue and outlays for 2007, based on the previous fifty
years, are 18.4% and 21.1% of GDP. The actual values were 18.5% and
19.6%. One could also invoke Hauser's Law for revenue.)
Notice a couple of things. First, FY 2007 saw above-average revenues and below-average spending. This was a good half-decade after the Bush tax cuts and Afghanistan and Iraq wars. Also, deficits were on a shrinking trend through the Republican-controlled Congress years of 2003 through 2007.
The next things to notice are the 2009 values. Revenues were lower than the lowest of the previous half-century (14.8% vs 16.1%), and outlays were
higher than the highest of the previous half-century (24.7% vs 23.5%) --
extreme values on both ends of the budget. FY 2009 was bad!
FY 2007 was a completely nominal, average, white-bread year following a string of fairly nominal, average, white-bread years. FY 2009 was way
out of whack in all respects, both on the revenue side and the outlay
side. There was no eight-year trend leading to 2009; it was big, bad,
and sudden. The 2009 deficit was unprecedented in U.S. peacetime
history, including the Great Depression (9.9% of GDP vs 5.9%).
A reasonable person would look at what happened between 2007 and 2009 to try to explain the 2009 budget numbers. In those two years, the world
changed.
Things that happened after FY2007, but before or during FY2009:
* An all-Democrat Congress started writing federal budgets.
* A housing bubble burst in addition to a financial crisis and a recession.
* TARP.
* Barack Obama elected, inaugurated, and governing as president.
* Obama's stimulus.
* The FY2009 omnibus bill and other Democrat-initiated spending (e.g., Cash for Clunkers).
Things that didn't:
* The Bush tax cuts.
* Big swing in War-on-Terror spending.
* Increased debt-servicing costs.
Bush Tax Cuts? There were no Bush tax cuts between 2007 and 2009; they became effective in 2001 and 2003. If you blame the Bush tax cuts for the low
revenue in 2009, how do you explain the perfectly normal, even above
normal, revenues in 2006 and 2007?
Iraq, Afghanistan, War on Terror? Total spending on the entire WOT was lower in 2009 than in 2007. The Congressional Budget Office put the 2007 figure at $171B and the 2009 figure at $155B. These figures include not only funding for all military operations, but also
funding for diplomatic operations, foreign aid, funding to indigenous
Iraq and Afghan forces, etc. Were it not for the WOT, 2007 would have
been in surplus by $10B.
Bush's Debt? Interest on the debt went down between 2007 and 2009. It was $237B in 2007 and $187B in 2009. So you cannot blame the interest payments on the debt accrued from previous
years of Bush tax cuts and wars, either.
Bush's Wall Street Bailout? You probably heard that TARP, which Senator Obama voted for along with most Democrats, cost $700B. No it didn't. Per the CBO, its actual cost in FY 2009 was $151B. (The CBO now estimates TARP's total cost, with many loans repaid, to come in at $66B.)
Obama's Stimulus? Obama's stimulus explains $180B of the FY 2009 deficit, according to the CBO. (In total, the stimulus is expected to add $814B to the
cumulative 2009-2019 deficit.)
The Recession? Bingo. For starters, a revenue fall of 3.7% of GDP is $527B. However, the CBO says Obama's stimulus accounts for $69B in revenue losses and tax credits in FY 2009. So we can chalk up $458B to the recession based on tax rates in place prior to 2009.
That's not because tax rates fell, but because revenue-generating activity fell -- jobs, corporate profits, dividends, capital gains, interest income.
When people lose their jobs due to a recession, government spending on functions like unemployment payments and Medicaid go up. The federal
government spent $233B more in 2009 than in 2007 on what it calls
"health care services" and "income security." But $67B of that came from
the stimulus. So the part due to policies in place prior to Obama is
$166B.
"Natural" Cost Growth. After the above, we are left with $313B that can't be cleanly accounted for. Some of that could be costs that grew at about the rate of GDP.
But nominal GDP went up only 2.5%. The costs of old-age programs grew a
bit faster due to the aging population. I'm willing to generously
allocate $150B to such natural cost growth.
Other Spending by Democrats. What remains is $163B. The Obama stimulus was not the only Democrat-authored spending. For example, Congress passed and Obama
signed an "omnibus" spending bill of $410B for FY 2009 in 2009, after
Bush was out of office. Not all of that $410B was above the
Bush-approved level, but much of it was. Democrats wrote both the FY
2008 and 2009 budgets, then passed more spending (e.g., Cash for
Clunkers) in 2009 on top of the stimulus. It is hard to pin down an
exact number, but $163B is probably an underestimate.
The above accounting can be summarized in a pie chart.
I agree with the JournoListers that the recession itself had a lot to do with it. But Bush had little to do with it, especially the two things
normally blamed on him: tax cuts and Iraq. Bush "policies," absent the
WOT and the recession/financial crisis, would have led to a surplus, not a deficit at all.
TARP was pretty darned bipartisan. But even so, it was only 11% of that 2009 deficit. Even the WOT was fairly bipartisan. (Obama is still spending about the same on the WOT;
he just shifted out of Iraq and into Afghanistan.)
I could also say natural cost growth was inevitable or bipartisan, but Republicans tried to deal with entitlement growth multiple times. In
fact, the Republican Congress passed Medicare reform in 1995, but
President Clinton vetoed it. Democrats killed Bush's Social Security
reform initiatives in the crib.
Whatever exactly happened between 2007 and 2009, the before and after pictures are completely different. The House, Senate, and presidency all switched
parties. We now talk in spending units of "trillions." The CBO foresees
no future deficit as low as 2007's, even after all the wars and
recessions are assumed over. The federal government owns two of the Big
Three auto companies. And all the above was before national health care.
To return to our Part I analogy of the U.S. economy as an airplane, Flight USA went from "all systems nominal" under Captain Bush and his
Republican crew to stormy weather, mechanical malfunction, an all-new
Democrat crew under Captain Obama, and a dangerous loss of altitude. All
in two years.
The passengers are nervous and restless, to say the least. Some even believe they heard "Allahu Akbar!" coming from the cockpit. Stay tuned
for Part III of our flight.
Randall Hoven is the creator of Graph of the Day. He can be contacted at randall.hoven@gmail.com or via his website, randallhoven.com.
BELIEVE IT OR NOT - IT WAS NOT BUSH'S DEFICIT AFTER ALL - OBAMA LIED AND THE MONEY WENT TO THE UNIONS AND PENSION PLANS FOR GOVERNMENT WORKERS.
Show me the money? Sorry the site will not print the graphs in the comments section but go to discussions and find
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- John C I will post articles that have facts and figures not personnel attacks and I post liberal articles many times because they point out the choices Americans have to make.
As to the cause of the recession, it is no ones fault it just part of the normal economic cycles. What goes up will come down in time. Check the economic trends of booms and busts for the last 150 years and you will see the pattern. The problem is that people now expect 535 attorneys and one executive to be so smart they can prevent recessions by spending money for non-productivity increasing projects or Social engineering.
Spending is ALWAYS the responsibility of the Congress, the executive branch can propose but the legislative branch must dispose. As to the title, it is correct because every time BHO says it was Bush's fault he is lying and intentionally misrepresenting the facts. The Progressive/Socialist believers have used the repeating of lies so many times in so many places that the public perceives it as truth, that my friend is just plain old lying down here in Texas.
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