“I’m so bored. I hate my life.” - Britney Spears

Das Langweilige ist interessant geworden, weil das Interessante angefangen hat langweilig zu werden. – Thomas Mann

"Never for money/always for love" - The Talking Heads

Saturday, September 13, 2003

Bollettino

Readers should go to Business Week for several articles that gingerly sift through the budget debacle. Trying to be fair to the White House, the writers put in some mush mouth disclaimers about how the US could "carry" a deficit equivalent to 5% of the GDP indefinitely. Yes, we could, but if the experience of the 90s showed us anything, it is that we are better off not. It is true that a smoker can still do two packs even after they yank out one of his lungs, but it isn't, I hear, recommended. Of course, these kinds of things are always wrapped around comparisons with long term corporate debts. The argument -- the sound argument -- is that any large organization needs to borrow to maintain and expand its infrastructure. That seems right to me. But there really is no corporate parallel that fits what Bush has done. The production of this debt load is not derived from any sane project -- it is actually coming on top of the refusal to finance forseeable future liabilities. When a corporation borrows heavily to give its top managers raises, and tries to disguise the loans on top of it, what do you have? Even Tyco avoided peculation on that scale.

My favorite of the BW articles this week is the one that describes the magic trick/pick pocketing act that is being performed before our very eyes with Bush's famous 87 billion -- and by the way, don't you love that 7? Not 8, and not 6. Of course, we know that it will really be closer to 100 -- a round number -- billion, if that.

Howard Gleckman points out that the 87 bil isn't going to be inked into the Fed budget:

"Said the Office of Management & Budget on Sept. 4: "Only within such a fiscal environment can we encourage increased economic growth and a return to a balanced budget." Expect veto threats and perhaps even veiled warnings of a government shutdown if that $784.7 billion spending cap isn't met.

There's just one problem. While Bush and Congress are fighting over every dollar, they're going to pretend the $87 billion in Iraq money doesn't count as part of the discretionary budget ceiling, even though every thing else the Pentagon does is included.

This is an accounting gimmick that would shame even Enron. "We will hold down spending," Bush and GOP leaders on Capitol Hill will say. But next to that boast will be a little imaginary asterisk that says, "For everything, that is, but Social Security, Medicare, Medicaid, a fistful of trust funds, and the war in Iraq." In truth, the government will spend more than $1.3 trillion next year -- close to twice the discretionay-spending target -- on stuff that doesn't count in Washington's debates over fiscal responsibility."

Now, you ask, how can they do that? The simple answer is: raw abuse of power.

"Watch for Bush to claim by the end the year that he held discretionary outlays to a 4% hike, even though spending will go up by close to 15%. The White House and Congress will just pretend it didn't happen.

And how will Uncle Sam pay for all these extra burdens? With real money that Treasury will have to borrow, creating real debt that your kids will be paying off for the rest of their lives."

Rumsfeld compares the war to the occupation of post-war Germany. The left compares Bush to Hitler or Mussolini. LI wants to introduce a different parallel (watch this meme sink, kiddies): this is Bush's equivalent of Versailles. Instead of a complex of palaces, our bewildered POTUS is setting up a 'theater of terrorism." Louis XIV never thought of that one -- he did pay for theatrical entertainments, but he was not a big thinker: he merely hired Racine and Moliere and the like. Kafka had a clearer instinct for the kind of big project Bush is pushing. Hence the Oklahoma Nature theater that comes at the end of Amerika. But even Kafka never imagined one country using a whole other country to set up a theater of terrorism. Is that a grand gesture or what? It's not hard to figure out why the natives don't like it -- they aren't civilized like we are. Otherwise, they'd be appreciative of our administration's artistic sensibilities. What an idea, after all: using their real flesh and blood for our adventure movie. Yee-haw!

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