The Congressional Budget Office released updated figures last month for projections on the budget deficit. The CBO is generally considered a reasonably non-partisan group whose analysis is as good and fair as anyone's and more reliable than most. This time I dug a bit into their assumptions and I'm frankly stunned. Their projections are for the next ten years, and the latest numbers are in the graph to the right. Although they have historic numbers available, in fact 50 years of them in the same spread sheet, I am only looking forwards: the Bush years are over and will not be repeated, it's the future that interests me. I will note only that the largest deficit under Bush was $408B and, heinous as that was, would be the smallest bar on this graph.
This graph has certain assumptions behind it. Here they are:
These assumptions are, in my opinion, a ridiculous fantasy.
|In addition to health care reform, the Pentagon continues to prepare fight the war to end all wars, in spite of the fact that every other nation has obviously ceded unquestioned conventional military superiority to us. We are currently building and flying the F-22 (left) and preparing to build over a thousand F-35s (right). These airplanes have no credible competition or targets: although the F-22 has been in service for some years, it has not been deployed in Iraq or Afghanistan. Also, since Russia and China so adamantly refuse to build modern fighters for us to shoot down, we're apparently preparing to fight an invasion of T-4 Terminators, as we're currently funding development of a whole slew of unmanned aerial fighters.|
In summary, I think the CBO has made some insupportably rosy projections. I think growth will be substantially lower, tax revenues will be lower, unemployment will be higher, pay outs to the unemployed and under employed will be higher, there will be some form of health insurance reform and it will be costly, and the deficits will be substantially higher. For nearly 30 years Republicans have cut taxes without regard to deficits, daring the Democrats to raise taxes. Obama, Pelosi and Reid are showing us a new kind of Democrat that puts their programs in place without regard to deficits, and dares the Republicans to not raise taxes. The losers of this game of chicken are the taxpayers, who are left paying for Johnson-Great-Society-style foreign excursions and huge new entitlement programs. We'll be paying through increased taxes, increased unemployment, decreased growth and increased inflation - what Reagan called "the misery index". My projections are below, and frankly, when I look at them, I think I've been too conservative in my estimates: I doubt things will play out even as well as I project.