Archive for August, 2011

4
Aug

Government Spending Cuts Explained

   Posted by: Interceder    in Government Spending

You want to buy a new car. You are a true patriot so you want an American made auto and you choose the Saleen S7 Twin Turbo at a cost of $555,000. However, you settle for a Cadillac STS at a cost of $55,000.  Aren’t you great? You are now a genius because you literally saved yourself a half a million dollars!! Of course in actuality, you can’t afford to buy a car at all right now, but your budget cut looks fantastic. You want to buy some new clothes and want to spend about $50,000 this month. However, you then decide to budget a mere $500. You are great because you cut your budged $45,500. You consider yourself to be an economic wizard. Of course, you really can afford only a pair of jeans for $50, but your budget cutting abilities are phenomenal. Does any of that really make sense to you? Well it is exactly what Congress and Obama just did to us with the “budget cuts” and debt increase. The problem is, America is gullible enough to fall for this falderal. How is it that Washington is allowed a whole new set of accounting rules applicable only to themselves. Not spending the money that doesn’t exist amounts to a spending cut. Who can make that work in the real world? If Congress had made the right choice and refused to raise the debt ceiling, the threat was that America’s credit rating would have been lowered. Here is a question no one ever asked. If Congress was not allowed to borrow money beyond its means, what difference would credit rating make?  



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