Candidate J, Column 1: Budget deficit
The AJC asked 10 finalists for a fulltime conservative columnist position to write two columns: one on efforts for a U.S. economic stimulus plan and one on any other topic. Here were the two columns submitted by Kyle Wingfield, the candidate who ultimately was chosen for the job. He was listed as candidate J in the original field of 10.
By Candidate J
The U.S. has been in dire straits for months, but only now are we getting a true glimpse of the “Money for Nothing” economy.
It started of course with subprime loans. Eventually the free-money act moved off-Broadway and to Washington: banking and auto bailouts, “quantitative easing,” a stimulus bill that left no Democratic donor’s back unscratched.
Now this: A senior Obama administration official told reporters recently that the budget deficit will be more than halved from this year’s record level by the time President Obama’s term ends. Obama detailed on Tuesday plans for reducing the deficit to $533 billion in 2013 from an estimated $1.5 trillion this year.
Here’s where the Dire Straits’ famous song title comes in. Obama will not only reduce the deficit by $1,000,000,000,000 in four years. His budget projections also include the vast expansion of government medical expenses needed to achieve universal health-insurance coverage, plus any additional bailouts or stimulus bills that Nancy Pelosi & Co. can dream up. The money will come from leaving Iraq, requiring companies to buy permits to emit carbon dioxide, and, of course, taxing “the rich.”
It’s all fantasy. Consider the White House’s assumptions about growth. We’re told that the $533 billion deficit in 2013 will represent 3 percent of gross domestic product. That means GDP would be almost $17.8 trillion.
This is quite the rosy scenario. In October, before everyone realized how bad things were, the International Monetary Fund projected our GDP in 2013 to be $17.3 trillion. How out-of-date is this forecast? Back then, the IMF predicted the U.S. economy would grow by 1.7 percent this year; it’s now widely expected to shrink by nearly 2 percent. Yet Obama’s forecast for 2013 requires the economy to be even larger than the IMF’s report projected.
Forget the other assumptions, too. Congressional Budget Office data suggest that the most that we could save by leaving Iraq—and, crucially, Afghanistan, where Obama is instead adding troops—is about $140 billion. Any permit system for carbon emissions will be undermined as a revenue generator by free or cheap allowances given to industries that Washington favors. (And that’s before you count the taxable economic activity lost when companies become less profitable or escape to more business-friendly countries.)
Finally, taxing the rich is a false hope. Since 1940, federal tax rates and brackets have varied widely but tax receipts have never exceeded 20.9 percent of the economy; the average is closer to 18 percent. To increase tax receipts, the economy must grow. And to make up $1 trillion with greater tax revenues, using Obama’s fiscal assumptions and that 20.9 percent ceiling, would require 20 percent economic growth by 2013. That puts us back in the neighborhood of the IMF’s old estimates.
If you think we can have universal health care and reduce the deficit by $1 trillion while someone else pays for it, break out your old Dire Straits cassette tape. Maybe Obama will give you your chicks for free, too.
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21 comments Add your comment
RealityKing
February 26th, 2009
12:07 pm
I like this one.., only liberals argue with numbers.
Mike
February 26th, 2009
3:34 pm
This writer will be swimming upstream in the AJC newsroom. He knows way too much about economics to work for a newspaper.
But, if it’s his or her lifelong dream, who am I to stand in the way?
Thumbs up.
C. Allen
February 26th, 2009
4:03 pm
The Dire Straits reference will be missed by some. I assume this columnist has been consistently aggravated by rosy budget projections through the years. Both parties are guilty of this.
Kathi
February 26th, 2009
7:49 pm
Wow, finally, a TRIPOD THESIS!
Thesis: “The money will come from [1] leaving Iraq, [2] requiring companies to buy permits to emit carbon dioxide, and, of course, [3] taxing ‘the rich.’”
Supporting arguments: “[1] the most that we could save by leaving Iraq … is about $140 billion. [2] Any permit system for carbon emissions will be undermined as a revenue generator … [3] Finally, taxing the rich is a false hope …”
Whether you agree with the arguments or not, at least the author makes a clear connection from start to finish. The other columns were mostly disorganized and confusing. The topic is also timely and relevant.
I think this is by far the best column. The first and last paragraphs are related, it’s colorful and uses simple language. The finish is just great. This is the only author I’ve seen that I can say I’d like to read more of.
JamC
February 27th, 2009
9:33 am
To me, this was the best of the Friday columns. The facts and figures were clearly presented, and Obama’s plans were blown out of the water.
The writing style and use of a Dire Straits song title were very effective.
blah
February 27th, 2009
12:30 pm
A fine column, but rather unremarkable, Sparked indifference within me once it started playing pitty-pat between “Democrats rewarding special interest groups” and “the supremely important war in Afghanistan.” Yawn.
td
February 27th, 2009
1:46 pm
This was a good article about the facts and figures and relative to today and is conservative in style. I do not feel any conservative compassion in the writing and wonder if this candidate is a true believer?
Rachel C
February 27th, 2009
2:18 pm
Well-written article. (Yay!!) Kind of spouting the same-old, same-old conservative talking points, but seems actually to have done the homework to back things up. I enjoyed it, but was not inspired.
B+
Betty Delk
February 27th, 2009
2:34 pm
I like Candidate J’s article very much. Choosing between Candidates J and G would be difficult for me.
Joan
February 27th, 2009
3:40 pm
Candidate J tackled THE issue right now, and did it with facts and figures. And yes, liberals are adverse to reality checks, but these are so desparately needed now. This one has done his/her homework and it shows.
Joan
February 27th, 2009
4:44 pm
Very well done!
Hugh L
February 27th, 2009
7:08 pm
I’m a middle-of-the-road admirer of most of Obama’s actions since taking office, but the shakiest thing about his budget is his set of assumptions about the fiscal status of the US in 2013. This very good column elucidates some reasons of which I’d not been aware, for the shakiness.
Lulu
February 27th, 2009
8:26 pm
This makes my head hurt but that’s my problem.I’m no fan of global economics because my heart isn’t in it but thank goodness some “hearts” and hopefully heads are. My talent lies in making family budget and seeing the ills in local, state and regional economics. This reaction is no reflection on the writer whose passion and talent in the subject are obvious.I just can’t wrap my small brain around the globe and projections. For me the writer needs to deal in spoonfuls and other, smaller doses. As I said, my problem.
Spiel
February 28th, 2009
3:51 am
Nicely written, and a welcome respite after the assault of the columns immediately preceding it!
Tom Black
February 28th, 2009
4:17 pm
Nice job…As a longtime Dire Straits fan, I appreciate the reference to “Money for Nothing.” What an apt title in this era of collosal budget deficits and Fed printing presses cranking out the cash 24/7.
If our mainstream media were not made up of so many liberal sycophants, there would be much more critical coverage of this fantasy-laden budget. Massive government programs or endeavors, once launched, invariably A) take on a life of their own and continue to expand indefinitely; and B) end up costing far more than originally projected. Medicare and Social Security are prime examples.
This column probably should have addressed the frighteningly large unfunded mandates of Medicare and Social Security, which will be in the tens of trillions of dollars, as well as the ever-increasing cost of interest on the national debt, which itself will represent a huge annual expense.
Mention also could have been made of the worldwide nature of the economic meltdown, and how that bodes ill for future U.S. tax revenues due to diminished commerce. If Americans are tapped out, we buy fewer Asian electronics goods and vehicles, meaning people in those countries are hurting, which has a ripple effect on surrounding nations, and so on.
Tackling economic and fiscal issues in a newspaper column is tricky because unfortunately so many people these days are ignorant of economic issues since our schools do a poor job of teaching economics. Overall, a credible job on an important topic.
Carolyn
February 28th, 2009
5:01 pm
This candidate gets my unqualified vote. I especially liked that the article is non-ideological in its approach. Instead, the points are made with facts, citing sources. There is no name-calling, and political-party lines are not drawn in the sand. I am a person who respects many of the fiscal conservative ideals (smaller government,more individual freedom) and many of the social ideals of liberals (equal rights for all, regardless of race, religion, or sexual orientation). It would be nice to hear intelligent, reasoned opinions such as this one, and it makes me want to hear what he/she will say in other areas. My friends who have cancelled subscriptions say they did it because of “obvious bias,” regardless of which side. Articles like this one would help.
Park
March 1st, 2009
10:19 pm
ejoyed “money for nothing – dire straits” and conceit carried throughout the article; balanced out the facts; made me want to read more from this writer.
Marilyn Michelitch
March 1st, 2009
11:00 pm
Candidate J Budget Deficit
this journalist writes clearly, succinctly and without disparagement
about the national Budget deficit. this conservative not only has his facts straight but he connects his thoughts with the words “Dire Straits” which really says it all !! One does not have to be an Economist to realize that the hopes of the current government are based on smoke.
I like this person’s style !!
Chris Broe
March 2nd, 2009
7:09 am
This writer obviously enjoys his craft. Like a subtle bulb, an overplayed MTV video was sown into the reader’s subconscious as the writer wove a comforter 4 the shorts, and even coaxed a dead (Cats) bounce off broadway. I like the use of culture to present economic epiphany. C+
Why not A+? The writer presents deficit projections as if they could punctuate his empty dirge about our economic down beat, which “all started with subprime loans”.
That much we do know for sure:. It all started with subprime loans. Okay, someone get Greenspan on the phone. Get Buffet 2..
first, the writer must convince the reader that he understands the breadth of the origins of this economic crisis. Second the writer must persuade the reader why any fiscal or monetary policy could be constrained by deficit targeting. Third, the writer’s own projections for future growth are as baseless as his summary of past growth. This article is very useful as a data point confirming the lack of trust in our institutions’ ability to promote growth. However, a better data base could be constructed with a simple poll question, “Are you better off than you were 100 days ago?”
gan
March 2nd, 2009
10:36 am
the writer appears to know how to balance a checkbook and is not chasing rainbows
anne
March 2nd, 2009
11:13 am
I liked the allusion to Dire Straits, provided interesting opening and closing lines. I appreciate arguments that are supported with numbers. Both Obama and his R and D predecessors are guilty of pie in the sky economics, but I hoped for a bit more from the current President. Although I don’t agree with all the writer’s points, I think the argument is well made.