# My half-baked budget proposal **URL:** \ **Category:** Great Debates\ **Created:** [March 31, 2011, 6:43pm UTC](https://boards.straightdope.com/t/my-half-baked-budget-proposal/576658 "2011-03-31T18:43:23Z")\ **Posts on this page:** 20\ **Page:** 2
**Author:** ![Voyager](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/voyager/32/133_2.png) [@Voyager](https://boards.straightdope.com/u/Voyager)\ **Post date:** [April 1, 2011, 1:06am UTC](https://boards.straightdope.com/t/my-half-baked-budget-proposal/576658/21 "2011-04-01T01:06:02Z")
> [@Sitnam](#): > > Making a nations economy hum isn’t like balancing a household budget. Macro economics is a different force altogether. You know, the Republican position reminds me of some asshole men I’ve heard of, who quit good jobs so as not to have the money to pay alimony to their ex-wives and kids. ---
**Author:** ![Ravenman](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/ravenman/32/2929_2.png) [@Ravenman](https://boards.straightdope.com/u/Ravenman)\ **Post date:** [April 1, 2011, 1:53am UTC](https://boards.straightdope.com/t/my-half-baked-budget-proposal/576658/22 "2011-04-01T01:53:33Z")
> [@Left\_Hand\_of\_Dorkness](#): > > Ravenman appears offended that the proposal would force budget cuts before taxes could be raised. Sam (and maybe you) are annoyed that the budget would force tax raises before budget cuts could occur. > > That’s kind of my point. No, my point is that there is no magic and appropriate ratio of changes to spending and revenue that will produce an optimal deficit reduction path. I’m trying to illustrate why your proposal makes it much more difficult to get anything passed, as opposed to making it easier. ---
**Author:** ![Sage\_Rat](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/sage_rat/32/399_2.png) [@Sage\_Rat](https://boards.straightdope.com/u/Sage_Rat)\ **Post date:** [April 1, 2011, 8:04am UTC](https://boards.straightdope.com/t/my-half-baked-budget-proposal/576658/23 "2011-04-01T08:04:55Z")
Here are some critiques of balanced budget amendments: > **[National Debt – Reading](https://publius2point0.wordpress.com/2010/04/18/national-debt-reading/)** > > The previous post was written based principally on my own knowledge and opinions. I have now read through some treatises by economists and the testimonies put before the Legislature in times previo… As an all-round summary of the arguments: 1. The government will always respond to a crisis, rules be damned 2. The government is at the mercy of the populace and the populace wants services but does not want to pay for them 3. As such, balanced budget laws do not change government behavior, they just cause creative accounting and quasi-governmental organizations that are outside the scope of the budget laws, overall making it harder to survey government accounting and adding financial overhead of its own ---
**Author:** ![BigT](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/bigt/32/12044_2.png) [@BigT](https://boards.straightdope.com/u/BigT)\ **Post date:** [April 1, 2011, 2:23pm UTC](https://boards.straightdope.com/t/my-half-baked-budget-proposal/576658/24 "2011-04-01T14:23:56Z")
My criticism is simple. Your proposal means that the current situation stays the same. But we have a deficit, meaning we are already spending more than we have. Your proposal would just continue that. For this sort of thing to work, you have to start with a balanced budget. It would be like a person trying to lose weight by exercising, and then eating the exact number of calories they burned. Nothing would happen. Just like you must lose the weight first, you must also balance the budget first. You can’t maintain something you don’t already have. Do you really think that all of these proposed cuts are because everything is balanced? ---
**Author:** ![Ravenman](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/ravenman/32/2929_2.png) [@Ravenman](https://boards.straightdope.com/u/Ravenman)\ **Post date:** [April 1, 2011, 2:45pm UTC](https://boards.straightdope.com/t/my-half-baked-budget-proposal/576658/25 "2011-04-01T14:45:54Z")
> [@BigT](#): > > My criticism is simple. Your proposal means that the current situation stays the same. But we have a deficit, meaning we are already spending more than we have. Your proposal would just continue that. In fairness to the OP, I think you aren’t following the proposal correctly. I thought the same thing the first time I read it, but the main thrust of the proposal is attempting to maximize deficit reduction by forcing liberals and conservatives to agree to both tax increases and spending cuts, which if it were successful would maximize deficit reduction. The problem is that is cannot be successful because it would encourage gridlock. But it is most definitely not a plan that would simply offset revenue and expenditures in a budget neutral way. ---
**Author:** ![septimus](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/septimus/32/410_2.png) [@septimus](https://boards.straightdope.com/u/septimus)\ **Post date:** [April 2, 2011, 8:04pm UTC](https://boards.straightdope.com/t/my-half-baked-budget-proposal/576658/26 "2011-04-02T20:04:22Z")
> [@Left\_Hand\_of\_Dorkness](#): > > Here’s the proposal: > -With about a 10% allowance for wiggle room, any bill that raises revenue must ALSO, dollar for dollar, cut spending by an equal amount. > -And vice versa: with the same wiggle room, any bill that cuts spending must ALSO, dollar for dollar, raise revenue by an equal amount. > -And contrariwise: any bill that reduces revenue must reduce programs by an equal amount, and any bill that reduces programs must reduce revenue by an equal amount. > > What are the problems with this proposal? Let me rewrite your rules as two symbolic expressions; I think that will clarify a problem. S is spending, R revenue, “–\>” denotes a permitted change. 1. (S, R) –\> (S-d, R+d) 2. (S, R) –\> (S-d, R-d) Applying first rule 2, then 1, we get 1+2. (S, R) –\> (S-2d, R) Great if reducing spending is your goal, but proof, IMHO, that your proposal makes little sense. What’s my solution? First step is to understand the problem(s). There’s a thread titled “Latest Republican stupidity” or some such in BBQ Pit with 2000+ posts. Browse through there, remembering that the people being quoted are not stand-up comics but elected Congressmen, then come back to GD with better insight. ---
**Author:** ![Left\_Hand\_of\_Dorkness](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/left_hand_of_dorkness/32/7156_2.png) [@Left\_Hand\_of\_Dorkness](https://boards.straightdope.com/u/Left_Hand_of_Dorkness)\ **Post date:** [April 2, 2011, 8:45pm UTC](https://boards.straightdope.com/t/my-half-baked-budget-proposal/576658/27 "2011-04-02T20:45:01Z")
**septimus** , see post 10. ---
**Author:** ![TriPolar](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/tripolar/32/3008_2.png) [@TriPolar](https://boards.straightdope.com/u/TriPolar)\ **Post date:** [April 2, 2011, 8:48pm UTC](https://boards.straightdope.com/t/my-half-baked-budget-proposal/576658/28 "2011-04-02T20:48:38Z")
Actually it’s pretty much the balanced budget concept. The real problem is that congress is just as willing to break their own rules as they are to make them. But I think it’s better than the two competing political concepts now, cutting taxes until we go broke vs. spending until we go broke, and of course the compromise position, cut taxes and spend until we go broke. ---
**Author:** ![Left\_Hand\_of\_Dorkness](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/left_hand_of_dorkness/32/7156_2.png) [@Left\_Hand\_of\_Dorkness](https://boards.straightdope.com/u/Left_Hand_of_Dorkness)\ **Post date:** [April 2, 2011, 8:53pm UTC](https://boards.straightdope.com/t/my-half-baked-budget-proposal/576658/29 "2011-04-02T20:53:34Z")
> [@TriPolar](#): > > Actually it’s pretty much the balanced budget concept. No, it’s not, and the difference is key. Balanced budget says: 1a) raise spending? Then 1b) raise revenue. 2a) Lower revenue? Then 2b) lower spending. Liberals AS A TENDENCY like 1a and don’t especially mind 1b in certain forms; conservatives tend to hate both 1a and 1b. Liberals AS A TENDENCY hate both 2a and 2b; conservatives tend to like 2a and not mind 2b. Liberals therefore push for 1 and against 2; conservatives therefore push for 2 and against 1. This says: 1a) lower spending? Then 1b) raise revenue. Liberals AS A TENDENCY don’t mind 1b as a way of balancing the budget, but they dislike 1a. Conservatives tend not to mind 1a, but they dislike 1b. In this proposal, interests would be much more balanced: given a particular proposal, that (for example) raises taxes on the rich by 20 billion, simultaneously cutting spending by 20 billion, where do you think the parties would land? It’d do more for the budget than the current proposal in Congress, and be less offensive to Democrats. ---
**Author:** ![Ravenman](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/ravenman/32/2929_2.png) [@Ravenman](https://boards.straightdope.com/u/Ravenman)\ **Post date:** [April 2, 2011, 8:57pm UTC](https://boards.straightdope.com/t/my-half-baked-budget-proposal/576658/30 "2011-04-02T20:57:04Z")
> [@Left\_Hand\_of\_Dorkness](#): > > In this proposal, interests would be much more balanced: given a particular proposal, that (for example) raises taxes on the rich by 20 billion, simultaneously cutting spending by 20 billion, where do you think the parties would land? Everyone would be opposed. ---
**Author:** ![TriPolar](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/tripolar/32/3008_2.png) [@TriPolar](https://boards.straightdope.com/u/TriPolar)\ **Post date:** [April 2, 2011, 9:32pm UTC](https://boards.straightdope.com/t/my-half-baked-budget-proposal/576658/31 "2011-04-02T21:32:08Z")
> [@Left\_Hand\_of\_Dorkness](#): > > No, it’s not, and the difference is key. > > Balanced budget says: > 1a) raise spending? Then 1b) raise revenue. > 2a) Lower revenue? Then 2b) lower spending. > > Liberals AS A TENDENCY like 1a and don’t especially mind 1b in certain forms; conservatives tend to hate both 1a and 1b. Liberals AS A TENDENCY hate both 2a and 2b; conservatives tend to like 2a and not mind 2b. > > Liberals therefore push for 1 and against 2; conservatives therefore push for 2 and against 1. > > This says: > 1a) lower spending? Then 1b) raise revenue. > > Liberals AS A TENDENCY don’t mind 1b as a way of balancing the budget, but they dislike 1a. Conservatives tend not to mind 1a, but they dislike 1b. > > In this proposal, interests would be much more balanced: given a particular proposal, that (for example) raises taxes on the rich by 20 billion, simultaneously cutting spending by 20 billion, where do you think the parties would land? It’d do more for the budget than the current proposal in Congress, and be less offensive to Democrats. Ok, I gotcha. Actually a pretty good proposal. ---
**Author:** ![TriPolar](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/tripolar/32/3008_2.png) [@TriPolar](https://boards.straightdope.com/u/TriPolar)\ **Post date:** [April 2, 2011, 9:44pm UTC](https://boards.straightdope.com/t/my-half-baked-budget-proposal/576658/32 "2011-04-02T21:44:23Z")
Has to step away and missed the edit window: The politicians may not like this, but maybe decent people will. It might be difficult to explain, but it makes it clear what direction spending/revenue is going. ---
**Author:** ![septimus](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/septimus/32/410_2.png) [@septimus](https://boards.straightdope.com/u/septimus)\ **Post date:** [April 2, 2011, 10:47pm UTC](https://boards.straightdope.com/t/my-half-baked-budget-proposal/576658/33 "2011-04-02T22:47:36Z")
> [@Left\_Hand\_of\_Dorkness](#): > > **septimus** , see post 10. Oops! I guess I should study the whole thread before responding. :dubious: Still, you didn’t consider this part of my correct response: > [@septimus](#): > > What’s my solution? First step is to understand the problem(s). There’s a thread titled “Latest Republican stupidity” or some such in BBQ Pit with 2000+ posts. Browse through there, remembering that the people being quoted are not stand-up comics but elected Congressmen, then come back to GD with better insight. ---
**Author:** ![Left\_Hand\_of\_Dorkness](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/left_hand_of_dorkness/32/7156_2.png) [@Left\_Hand\_of\_Dorkness](https://boards.straightdope.com/u/Left_Hand_of_Dorkness)\ **Post date:** [April 3, 2011, 12:07am UTC](https://boards.straightdope.com/t/my-half-baked-budget-proposal/576658/34 "2011-04-03T00:07:09Z")
> [@septimus](#): > > There’s a thread titled “Latest Republican stupidity” or some such in BBQ Pit with 2000+ posts. Browse through there, remembering that the people being quoted are not stand-up comics but elected Congressmen, then come back to GD with better insight. Well, sure–but I know there are some decent, rational Republicans, having met them in real life and on this messageboard. And I also know from firsthand experience about some real idiot Democrats. My proposal obviously isn’t geared toward the insincere or the idiots in either party. And in case there’s any doubt, it’s more of a thought-experiment than anything else, because there’s no way of getting it passed, much as I might like it if it did. ---
**Author:** ![Wesley\_Clark](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/wesley_clark/32/20581_2.png) [@Wesley\_Clark](https://boards.straightdope.com/u/Wesley_Clark)\ **Post date:** [April 3, 2011, 12:48am UTC](https://boards.straightdope.com/t/my-half-baked-budget-proposal/576658/35 "2011-04-03T00:48:25Z")
Sounds like PAYGO > **[PAYGO](https://en.wikipedia.org/wiki/PAYGO)** > > PAYGO (Pay As You GO) is the practice in the United States of financing expenditures with funds that are currently available rather than borrowed. > The PAYGO compels new spending or tax changes not to add to the federal debt. Not to be confused with pay-as-you-go financing, which is when a government saves up money to fund a specific project. Under the PAYGO rules, a new proposal must either be "budget neutral" or offset with savings derived from existing funds. > The goal of this is to require tho... ---
**Author:** ![Wesley\_Clark](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/wesley_clark/32/20581_2.png) [@Wesley\_Clark](https://boards.straightdope.com/u/Wesley_Clark)\ **Post date:** [April 3, 2011, 12:53am UTC](https://boards.straightdope.com/t/my-half-baked-budget-proposal/576658/36 "2011-04-03T00:53:03Z")
> [@Sam\_Stone](#): > > So there’s no room in there anywhere for someone who wants to just make government smaller? The only way I can cut the size of government is to increase the amount of taxation? And it must be a 1:1 ratio? That would never fly. > > Canada was in the same kind of mess as the U.S. is in. We got out of it by cutting government size and increasing taxes - but the ratio was $7 in cuts for every $1 in tax increases. Then, once we got the budget roughly in line with reality, we slowly grew our way out of the problem by holding government spending growth a couple of percentage points below GDP growth, so that government as a share of GDP eventually declined from 53% to 34%. In addition, as GDP grew in relation to government, our deficit shrunk, and eventually turned into a surplus. We used the surplus to pay down the debt, and as our debt-carrying costs declined, we took the saved interest and turned it back to the public in the form of tax cuts. > > Along the way, we fixed our own social security insolvency by increasing the payroll deduction and by separating it into a basic stipend and an income supplement for low income people - essentially means-testing half of it. > > That’s how you do this kind of thing rationally. You can’t gimmick your way out of it. In my adult lifetime there have been numerous proposals for balanced budget amendments. There have been spending limitation bills passed, like Gramm-Rudman, Gramm-Rudman-Hollings, etc. None of them mattered. Hell Obama even had a ‘paygo’ rule - which was quickly violated. > > The way out of the quandary the U.S. is in required honest leadership. It requires a president willing to attack the third rail of politics by proposing reforms to Medicare and Social Security - and then to SELL it to the country. The leadership has to change public opinion - not be buffeted around by it. > > That’s the biggest problem I see in American politics. Every politician has his finger in the wind, trying to figure out which way the wind blows so he can go with it. But real leadership means _changing_ the polls. It means taking your case straight to the people, explaining the problems, the potential solutions, and the price of not doing something. Reagan did it, Clinton did it, Bush didn’t and neither has Obama. > > So long as politicians in the U.S. continue to be pawns of special interests and terrified of bucking public opinion, you can come up with all the gimmicky rules and laws as you want, and they’ll find a way around it. > > Also, you’re not going to get buy-in from any Keynesians. Your plan is anti-Keynesian - the government cannot borrow money and spend it in hard times. In fact, there’s a double-whammy - to cut spending, it has to raise taxes. Both are anti-stimulative to some degree. That’s fine by me, but I’m not a Keynesian. A lot of our deficits are due to health care and the recession though. Before this recession hit our deficits were $300-400 billion a year, then they jumped to 1.5 trillion a year. If we weren’t in a recession, they’d be back to about 2-3% of GDP. Not a small number but if you eliminated the war in Iraq and Bush tax cuts (ie, if Al Gore had obtained the election in 2000) then the deficits would be a fraction of their size up until the recession, probably $100 billion a year or less. A couple of painless policy changes would’ve balanced the budget. However I have no idea how much revenue the tax cuts created to compensate for their costs, so I didn’t factor that in. But suffice it to say, if we weren’t in a severe recession then balancing the budget wouldn’t be too hard. If not those 2 policies, I’m sure other policy changes could bring the deficits down. Aside from that, our health care costs about 17% of GDP, vs the 11% or so Canada spends. So if our publicly funded health care were as efficient as Canada, we’d save about 1 trillion a year, of which about 600 billion would come from the public sector (and about 300-400 billion of that from the federal government). But reforming health care in the US is near impossible. ---
**Author:** ![Left\_Hand\_of\_Dorkness](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/left_hand_of_dorkness/32/7156_2.png) [@Left\_Hand\_of\_Dorkness](https://boards.straightdope.com/u/Left_Hand_of_Dorkness)\ **Post date:** [April 3, 2011, 2:46am UTC](https://boards.straightdope.com/t/my-half-baked-budget-proposal/576658/37 "2011-04-03T02:46:37Z")
> [@Wesley\_Clark](#): > > Sounds like PAYGO > > [PAYGO - Wikipedia](http://en.wikipedia.org/wiki/PAYGO) Err–see post 29. ---
**Author:** ![TriPolar](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/tripolar/32/3008_2.png) [@TriPolar](https://boards.straightdope.com/u/TriPolar)\ **Post date:** [April 3, 2011, 3:09am UTC](https://boards.straightdope.com/t/my-half-baked-budget-proposal/576658/38 "2011-04-03T03:09:00Z")
> [@Left\_Hand\_of\_Dorkness](#): > > And in case there’s any doubt, it’s more of a thought-experiment than anything else, because there’s no way of getting it passed, much as I might like it if it did. I don’t think it would be impossible if the political messaging were done right. Really tough since it’s not in the interests of the people financing politicians, but the Tea Party has had a surprising effect on the current political environment. Passing it is one thing though, having it followed is another. ---
**Author:** ![Chronos](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/chronos/32/134_2.png) [@Chronos](https://boards.straightdope.com/u/Chronos)\ **Post date:** [April 3, 2011, 7:59pm UTC](https://boards.straightdope.com/t/my-half-baked-budget-proposal/576658/39 "2011-04-03T19:59:01Z")
OK, so suppose I want to increase spending by 200 billion dollars but don’t want to change revenues. It looks like, under your rules, all I have to do is pass one bill that increases spending by 100 billion and decreases revenues by 100 billion, and then immediately pass another bill that increases both spending and revenues by 100 billion. ---
**Author:** ![Left\_Hand\_of\_Dorkness](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/left_hand_of_dorkness/32/7156_2.png) [@Left\_Hand\_of\_Dorkness](https://boards.straightdope.com/u/Left_Hand_of_Dorkness)\ **Post date:** [April 3, 2011, 9:40pm UTC](https://boards.straightdope.com/t/my-half-baked-budget-proposal/576658/40 "2011-04-03T21:40:15Z")
That’s a fair point. I think I need to modify the proposal again: remove the contrariwise. [Previous page](https://boards.straightdope.com/t/my-half-baked-budget-proposal/576658.md?page=1)