Debt, Deficits & Defence: Debunking "My Progressive Little Ponyland" Math

M2RB:  Ronnie James Dio

 I see you’re all, you’re all, you’re all Rainbows
You are Rainbows in the Dark

2 + 2 = 5

Many on the Left have argued that our deficit problems could be magically made to vanish just by cutting defence by 50% and ending the Bush tax cuts for the evil rich.  Obviously, many on the Left are deliriously drunk on the kookaide served in "My Progressive Little Ponyland."  Simply put: Math is hard, it is harder when you are stupid and it is downright impossible when you are a Prog.

Assuming all other things being equal and held constant, which is unlikely since history has proven time and time again that taxpayers do modify their behaviour and investments in response to tax rises, Treasury estimates that allowing the cuts in income taxes for high-income households (those with adjusted gross incomes above $250,000 for married filers and $200,000 for single filers) and estate taxes that were enacted in 2001 and 2003 to expire at the end of 2012 would save a $968 billion over the next ten years.*  Let's use the straight-line average of $96.8 billion per year. 

In FY2001, defence spending accounted for 19.7% of the Federal budget ($366.2 billion out of $1.86 trillion). 

FY2002: 19.9%  ($421.7 billion / $2.109 trillion)

FY2003:  22.4% ($482.9 / $2.1599)

FY2004:  23.7% ($542.5 / $2,292.8)

FY2005:  24.3% ($600 / $2.472)

FY2006:  23.3% ($621.1 /  $2.6651)

FY2007:  23.9%  ($652.6 / $2.7281)

FY2008:   24.4%  ($729.6 / $2.9825)

FY2009:  22.6% ($794 / $3.5177)

FY2010:  24.5% ($847.2 / $3.4562)

FY2011:  25.4% ($878.5 / $3.6031)

FY2012:  23.8% ($902.2 / $3.7956)

Since FY2001, $7.8385 has been spent on defence and national security -- an average of $784 billion per year.  50% of $784 billion is $392 billion.

Now, adding the revenue from ending the Bush tax cuts on the wealthy, returning the death tax rate to 55%, and cutting defence:

$96.8 billion + $392 billion = $488.8 billion

Deficits:

FY2009:  $1.413 trillion 

FY2010:   $1.293 trillion

FY2011:   $1.300 trillion

FY2012 (e):   $1.327 trillion

The average Federal budget deficit over the last 4 years was $1.33325 trillion.

So, riddle me this, batshyt crazy Progs, how does cutting defence by 50% and ending the Bush tax cuts for the wealthy close the budget deficit when:

$1.33325 trillion - $392 billion = $941.25 billion

That's right!  You are still left with a budget deficit averaging $941.25 billion per year.  Even if we zero out defence:

$1.33325 trillion - $784 billion = $549.25 billion

YOU ARE STILL LEFT WITH A BUDGET DEFICIT OF $549.25 BILLION.

But, look on the bright side, within the decade, every penny in tax revenue will be consumed by Social Security, Medicare, Medicaid, and a $1 trillion annual debt service (and that's IF interest rates remain at historic lows) shere will not be any money left for defence!

John Kitchen of the U.S. Treasury and Menzie Chinn of the University of Wisconsin published a study in 2010 entitled "Financing US Debt: Is There Enough Money in the World -- and At What Cost?"

By 2020, Kitchen and Chinn project them to rise to about 19 percent of the rest of the world’s GDP, which they say is . . . do-able....BUT TOTALLY NEVER GONNA HAPPEN UNREALISTIC.

Whether the rest of the world will want to do it is another matter. A future that presumes the rest of the planet will sink a fifth of its GDP into U.S. Treasuries is no future at all.

Progs always say that we are 5% of the world's population, but use 25% of its resources, which, according to them, is a very bad, racist, oppressive, selfish, and mean thing to do.

Evidently, being 5% of the world's population and expecting the equivalent of the Coolies to build our modern-day railroads, which are known as Obamacare, Social Security, Medicare, free college, subsidised housing, cradle-to-grave welfare, etc., by demanding that the rest of the world spend 20% OF THE GLOBAL GDP EVERY YEAR ON US TREASURIES beginning in 2020 while we sit on our couches eating Twinkies watching American Idol while our solar-panel-generated air conditioners are blasting away because "we are so trying to save the planet, man" is perfectly acceptable. 

* Source:  President Obama’s FY 2013 budget, Summary table S-9.

 Rainbow In The Dark - Ronnie James Dio

When there's lightning – you know it always bring me down
Cause it's free and I see that it's me
Who's lost and never found
I cry out for magic - see it dancing in the light
It was cold - lost my hold
To the shadows of the night

There's no sign of the morning coming
You've been left on your own
Like a Rainbow in the Dark
A Rainbow in the Dark

Do your demons - do they ever let you go
When you've tried - do they hide - deep inside
Is it someone that you know
We're just a picture – we’re an image caught in time
We're a lie - you and I
We are words without a rhyme

No sign of the morning coming
‘Cause you've been left on your own
Like a Rainbow in the Dark
Rainbow in the Dark

When there's lightning – you know it always brings me down
Cause it's free and I see that it's me
Who's lost and never found
I cry out for magic – see it floating in the air
But it's fear - and you'll hear
It calling you beware – look out

No sign of the morning coming
There's no sight of the day
You've been left on your own
You are a Rainbow
Rainbow in the Dark
Rainbow in the Dark
Rainbow in the Dark
A Rainbow in the Dark
Too many mornings
Rainbow in the Dark, dark, dark

I see you’re all, you’re all, you’re all Rainbows
You are Rainbows in the Dark