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02/12/2004 Entry: "Molly Ivins on the bush deficit"

"When Bush took office, the national debt was $5.7 trillion, and his first budget proposed to reduce it by $2 trillion over the next decade. Today, the debt is $7 trillion.

"Last year, Bush predicted a deficit of $262 billion. According to the CBO, the deficit is currently $480 billion. Bush plans to cut biomedical research, health care, job training and veterans funding, and that still leaves a projected deficit of $450 billion.

"It is unclear to me why anyone would believe anything the president says about our fiscal situation. Keep in mind that this is a man who took three Texas oil companies into bankruptcy."

 by Molly Ivins, Star Telegram, January 22, 2004


Update Again - Saturday, August 06, 2005


By: Ed Henry

The real deficit is the amount of money the government must borrow to make ends meet each year. So far this year, the national debt has gone up $508.5 billion and we’ve still got two more months before the end of the fiscal year on September 30th so we’re going to end up with an increase of more than $600 billion this year.

But this increase in debt does not mean that all of it is a deficit. A sizable chunk of it is nothing but interest that’s dumped into 151 trust fund accounts on the fraudulent “Intragovernmental Holdings” (IH) portion of the national debt, the side where entitlements like Social Security, Medicare, Military Retirement, and so forth, form more than 90 percent of these debt “holdings” and where it costs the government absolutely nothing to add this interest since they merely credit these black hole debt accounts with more obligations for you and your children to pay off.

As of Friday, July 29th, the national debt stands at $7.89 trillion which means we will hit the debt limit or self-imposed ceiling game of $8.18 trillion somewhere around the end of the calendar year when this ceiling will, with a few theatrical noises, be automatically increased once again and for the umpteenth time. Merry Christmas, Happy New Year, and another nice present for your children and grandchildren who will have no way in the world of paying off this obligation brought to you by a government that cannot live within its means, will not raise income taxes even when needed, and has little if any financial conscience. Why should they? The “public servants” responsible for this mess will be gone in a few years, retired in luxury.

It will also mean that the Bush administration will have borrowed $800 billion in 13 months since the last ceiling increase in November of 2004 and $2.2 trillion since taking office in January of 2001. That’s about a 40 percent increase in the national debt in five years.

After this fantastic markup, George Bush promises to cut deficits in half by the end of his presidency. Isn’t that great? Wow, what a feat. The debt will only increase half as much each year after he has done such a wonderful job of putting us under the thumb of countries like China , Japan , India , and others.

And the loyal trickle-down borrowholics are ga-ga over the fact that this year’s deficit is going to be less than anticipated just a few months ago. The recent boost in income tax receipts means that we may have only about a $375 billion deficit in fiscal 2005, the tax cuts for the rich and famous are producing results, and Bush may be able to keep his promise of bringing deficits down to a mere $200 billion or so by 2008. The last year of Clinton ’s reign brought us an increase of $18 billion.

In the last forty years, the national debt has never gone down. How could it when the interest alone that’s being dumped into the IH accounts amounts to so much. Social Security alone will produce at least $1.6 trillion in interest by 2018, the year everyone currently agrees will mean the end of surpluses produced by payroll tax overcharges. $87 billion is being dumped into the account this year alone, and that’s not counting all of the other so-called “trust funds” that will get interest too.

And it costs the federal government nothing to add this public indebtedness. Even Thomas R. Saving, one of the public trustees of the Social Security and Medicare trust funds says; “We can make that trust fund anything we want to. If we want to change the interest payments, which is a suggestion that’s been made, change the rate of interest, make it 100 percent a year, we can make this last forever.” There is no actual money involved in this annual interest increase.

Adding this interest is the most heinous part of the scam. It’s bad enough that the Beltway Bandits steal our retirement, health care, and other entitlement surplus overpayments for invasions and pork, but adding interest merely to support the false idea that they only “borrowed” the money is the greatest crime of all.

In short, we would be better off if the pirates just stole the money and ran off to build their Empire, conduct invasions, and protect themselves behind a wall of false security.

And they’ve just added another element of protection by electing Chris Cox to head the Security & Exchange Commission. While the rest of the country was involved with the question of John Bolton’s appointment to the United Nations, Sandra Day O’Connor’s replacement on the Supreme Court, and other newsworthy items, Cox was appointed on Friday, July 29th, just before Congress adjourned for its vacation without a whimper from any of his fellow buckaneers. Oh well, the SEC never did anything to protect the American taxpayers from this scam anyway.

If you want to know the real deficit for this year, wait until the close of the fiscal year and subtract the annual interest dumped in IH accounts from the increase to the national debt. It will be close to a half trillion.

On the other hand, let's assume that the government's way of accounting for the deficit brings it in at $375 billion this year. From that point we can add the money they stole from Social Security alone which will be about $67 billion this year. Remember, they are the ones who claim to be "borrowing" this money, so why isn't it counted along with the rest of the money they borrowed legitimately?

That brings the amount to $442 billion without counting the rest of the money they "borrowed" from Medicare and other entitlements. The latter will bring us closer to the half trillion mark.

And what about the interest that they dump into the IH accounts? It may not be direct borrowing, but it certainly is tied to the amounts they've borrowed/stolen in the past and it adds to our indebtedness. Social Security's contribution alone is another $87 billion in interest this year. Where would that put us for a total deficit?

In other words, isn't the amount that the national debt increases every year our real deficit, $593 billion last year and even more this year? God save the Empire.

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