Bruce Bartlett Is Convincing Me That We Need a VAT
links for 2010-01-28

Department of "Huh?!?!"


I know that some in my own party will argue that we cannot address the deficit or freeze government spending when so many are still hurting. I agree, which is why this freeze will not take effect until next year, when the economy is stronger.

Now I am genuinely confused. The Office of Management and Budget says that the "freeze" starts in October with the start of fiscal 2011:

Ryan Avent: Deputy Director of Office of Management and Budget Rob Nabors responded to a question on how the freeze might conflict with efforts to return the economy to full employment. Mr Nabors noted that in 2010, the adminstration was focused on putting Americans back to work. Then in 2011, when the economy is on a more stable footing, the president will turn his attention to working toward a sustainable budget situation. This is utter foolishness. Fiscal 2011 begins in October of this year. At that point, according to CBO, unemployment will be above 9.5%. At the beginning of fiscal 2012, according to CBO, unemployment will still be at or near 9%...

Does the Office of Management and Budget not know what the budget proposal is? Does Barack Obama not know that fiscal 2011 accounting period begins this October?


Starting in 2011, we are prepared to freeze government spending for three years. Spending related to our national security, Medicare, Medicaid, and Social Security will not be affected. But all other discretionary government programs will. Like any cash-strapped family, we will work within a budget to invest in what we need and sacrifice what we don’t. And if I have to enforce this discipline by veto, I will...

Oh boy. If the ARRA was good policy, then--because interest rates on Treasury debt now are lower than everybody thought they would be--enlarging and extending it is good policy, and any "freeze" is political posturing. If a "freeze" now is good policy, then the ARRA was political pandering.

It is not good to defend the ARRA and say that it saved two million jobs and then turn around and reverse your argument ten monutes later. Not good at all...