In casew you wondered where "baseline budgeting" came from, and Fed spending goes up

[Little-Acorn]

You've probably heard of "Baseline Budgeting", and how government big-spending addicts use it to automatically increase the amount the government spends... even without passing a budget for year after year.

And you may have wondered why politicians were so eager to call some of the recent spending super-increases, "stimulus" spending, when in fact they stimulated nothing but merely piled up trillions more in debt.

Here's a great explanation of some of the details.

And not even very long.

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Blog: Congress, Baseline Budgeting, and Fraud

Congress, Baseline Budgeting, and Fraud

Alex Gimarc
October 19, 2012

Today's lesson is a short excursion into the dismal science and black art of congressional budgeting and why there was not a single stimulus, but multiple "stimuli" passed since 2007 -- which account for most of our yearly $1.4 trillion spending deficit.

In 1974, a Democrat-dominated Congress in the throes of Watergate passed the Congressional Budget Act of 1974. Among other things, the act established the Congressional Budget Office and codified the notion of baseline budgeting. A budgetary baseline increases about 6% per year. Any expenditure less than that 6% yearly increase is portrayed as a budget cut by Democrats and their media lackeys.

One of the games played by Democrats under this law is the passage of stimulus bills. When a stimulus is passed, it adds immediately to the budget baseline for that year and then for every succeeding year. So the Obama-Pelosi-Reid stimulus passed in 2009 added $787 billion of new spending to the federal budget in 2009. It then went on to add $834 billion of new spending in 2010 ($787 billion times 1.06 for the 6% yearly increase); $884 billion in 2011; and finally $937 billion in 2012. Over the last four years, this totals $3,442 billion more than would have been budgeted through the normal process -- which is precisely why the Democrats wanted it passed as a stimulus.

Since Harry Reid's Democratic majority in the Senate has consistently refused to pass a budget for nearly three years, the continuing resolutions have simply maintained the yearly automatic 6% increase in spending, leading to the enormous budget deficits of the Obama years.

Interestingly enough, the 2009 Obama stimulus was not the first stimulus passed by the Reid- Pelosi congresses. They passed a $152 billion stimulus in 2007 when the democrats retook majorities in the House and the Senate. Another $146 billion stimulus passed in 2008. President Bush signed both of them. The 2007 stimulus added $1,060 billion and the 2008 stimulus added $823 billion of new spending through 2012.

Add the three totals together and you end up with $5,326 billion of new spending based simply on adding a new stimulus to the yearly budget baseline and never removing them. That $5,326 billion ($5.3 trillion) represents the entirety of the new deficit spending under the Obama administration which has not had one of their budgets passed since 2009.

So what do we learn from all of this? First is that the Democrats are bloody good at deception and fraud. Second is that when any congress-critter starts talking about an economic stimulus, we taxpayers ought to start looking for the tar and feathers. Third is that the budgetary process in Congress is badly broken and completely deceptive. Finally, the Congressional Budget Act of 1974 must be repealed in its entirety and replaced with a budget process that mirrors what business and/or households use: one that holds a budgetary baseline at zero with no increase so that a real increase is properly flagged and a real decrease is properly identified. Anything else is a fraud upon the taxpayer and should be treated appropriately.

 

[Little-Acorn]

Will we ever get some adults into Congress, so that we can get back to actual budgeting, and accounting for what we spend?

 

[Freemason9]

At some point, you should explain exactly how budget deficits are bad during recessionary business cycles. I haven't heard that one yet.

Also, you might want to elaborate on how that 6% number came about. It wasn't arbitrary, and it is an important number in terms of money supply and economic growth.

 

[Little-Acorn]

Would it be a reasonable idea, to repeal the part of the law that calls for these regular, automatic increases?

"Continuing resolutions", that Congress passes to spend money when there is no budget, used to be restricted to continuing on the the same level of spending, as in the previous year. Why not reinstate that?

 

[Freemason9]

Would it be a reasonable idea, to repeal the part of the law that calls for these regular, automatic increases?

Why? Does sustained economic growth make you nervous?

"Continuing resolutions", that Congress passes to spend money when there is no budget, used to be restricted to continuing on the the same level of spending, as in the previous year. Why not reinstate that?

Again, why? Why would you want to inhibit the economy in that manner? The only way we can maintain growth is by expanding the money supply to match the value of our economy.

 

[Little-Acorn]

"sustained economic growth" has nothing to do with government spending. In fact, government spending usually holds economic growth back.

Only if the economy is strong enough to grow robustly, should government venture into spending more money. And that certainly isn't the case now.

Repealing the part of the law that causes automatic increases in spending, is looking better and better every day. Especially when the Congress (or half of it) doesn't even have enough responsibility to pass a budget at all.

 

[Erand7899]

Would it be a reasonable idea, to repeal the part of the law that calls for these regular, automatic increases?

Why? Does sustained economic growth make you nervous?

"Continuing resolutions", that Congress passes to spend money when there is no budget, used to be restricted to continuing on the the same level of spending, as in the previous year. Why not reinstate that?

Again, why? Why would you want to inhibit the economy in that manner? The only way we can maintain growth is by expanding the money supply to match the value of our economy.

You are talking nonsense. Have you seen any continuous economic growth over the last four years? We had negative economic growth in the fourth quarter of 2012, and we may well have another quarter of economic growth in the first quarter of 2013.

It ought to be obvious to even a dumbass liberal, that your economic theory is garbage. BTW, it is the fed that controls the money supply, not congress, and they have been printing money as fast as the machines will run.

 

[edthecynic]

Congressional Budget Act of 1974, so it was a Republican who signed it, and it was St Ronnie who required that the baseline for discretionary appropriations would be adjusted to keep pace with inflation in 1987 creating a bias in favor of spending by assuming that federal spending must keep pace with inflation and other factors driving the growth of entitlement programs.

 

[Freemason9]

"sustained economic growth" has nothing to do with government spending. In fact, government spending usually holds economic growth back.

Only if the economy is strong enough to grow robustly, should government venture into spending more money. And that certainly isn't the case now.

Repealing the part of the law that causes automatic increases in spending, is looking better and better every day. Especially when the Congress (or half of it) doesn't even have enough responsibility to pass a budget at all.

Pure poppycock. Strong levels of government spending have always been characteristic of advanced economies; if you doubt this, you should actually take the time to look at real statistics over the past 100 years. When spending falls, a recession follows. When spending increases, economic activity increases (see the Reagan years of robust federal spending).

 

[Freemason9]

Would it be a reasonable idea, to repeal the part of the law that calls for these regular, automatic increases?

Why? Does sustained economic growth make you nervous?

"Continuing resolutions", that Congress passes to spend money when there is no budget, used to be restricted to continuing on the the same level of spending, as in the previous year. Why not reinstate that?

Again, why? Why would you want to inhibit the economy in that manner? The only way we can maintain growth is by expanding the money supply to match the value of our economy.

You are talking nonsense. Have you seen any continuous economic growth over the last four years? We had negative economic growth in the fourth quarter of 2012, and we may well have another quarter of economic growth in the first quarter of 2013.

It ought to be obvious to even a dumbass liberal, that your economic theory is garbage. BTW, it is the fed that controls the money supply, not congress, and they have been printing money as fast as the machines will run.

The "fed" issues debt to provide money for increased economic activity and federal spending. You basically had that right, but I don't believe you actually understand the process.

Congressional Republicans have been successful in restraining stimulant spending since this massive recession began. It's remarkable that we have recovered as much as we have, given the level of Republican obstructionism.

 

[Wiseacre]

Question: did the House repubs pass a bill limiting spending increases to a certain percentage?

 

[Freemason9]

Question: did the House repubs pass a bill limiting spending increases to a certain percentage?

I'm not sure Congress has passed anything of substance in recent memory.

 

[Little-Acorn]

"sustained economic growth" has nothing to do with government spending. In fact, government spending usually holds economic growth back.

Only if the economy is strong enough to grow robustly, should government venture into spending more money. And that certainly isn't the case now.

Repealing the part of the law that causes automatic increases in spending, is looking better and better every day. Especially when the Congress (or half of it) doesn't even have enough responsibility to pass a budget at all.

When spending increases, economic activity increases (see the Reagan years of robust federal spending).

That's hilarious. If it were even close to being true, we'd have the most robust economy in the country's history right now, better by an order of magnitude than any time in the past.

Do you even think about what you're saying, before you say it?

If Barack Obama and the Democrats did us any favors at all in the last four years, it was when they disproved this keynesian nonsense once and for all... for the few who still believed in it.

Repealing the part of the law that causes these unending, automatic increases in govt spending, is sounding better and better.

 

[Freemason9]

"sustained economic growth" has nothing to do with government spending. In fact, government spending usually holds economic growth back.

Only if the economy is strong enough to grow robustly, should government venture into spending more money. And that certainly isn't the case now.

Repealing the part of the law that causes automatic increases in spending, is looking better and better every day. Especially when the Congress (or half of it) doesn't even have enough responsibility to pass a budget at all.

When spending increases, economic activity increases (see the Reagan years of robust federal spending).

That's hilarious. If it were even close to being true, we'd have the most robust economy in the country's history right now, better by an order of magnitude than any time in the past.

Do you even think about what you're saying, before you say it?

If Barack Obama and the Democrats did us any favors at all in the last four years, it was when they disproved this keynesian nonsense once and for all... for the few who still believed in it.

Repealing the part of the law that causes these unending, automatic increases in govt spending, is sounding better and better.

Just look at the fucking evidence for once, instead of blathering on and on. FUCK

 

[Little-Acorn]

The occasional disgruntled keynesian aside, apparently none of the usual liberals seem to have much to say about the constant increases in Federal spending that were enabled by the Baseline Budgeting introduced in 1974, by a nearly-veto-proof Democrat congress. With this, the Democrats achieved one of their longest-held dreams: A government in which spending would go up and up by default, without their having to do anything to make it do so.

Now we are reaping the fruits of that achievement, with spending exploding even as the National Debt soars and the nation's economy totters. Isn't it about time to repeal the part of the law that enables unlimited, automatic increases in government spending with zero Congressional oversight and responsibility?

It's no surprised that the liberals aren't touching this one with a ten-foot pole. They like things just fine the way they are: Unlimited funds, unlimited spending, with no accountability to the people for what happens to them. "Hey, it's not MY doing that spending went up."

But should normal Americans yield and let it go with that?

 

[edthecynic]

The occasional disgruntled keynesian aside, apparently none of the usual liberals seem to have much to say about the constant increases in Federal spending that were enabled by the Baseline Budgeting introduced in 1974, by a nearly-veto-proof Democrat congress. With this, the Democrats achieved one of their longest-held dreams: A government in which spending would go up and up by default, without their having to do anything to make it do so.

Now we are reaping the fruits of that achievement, with spending exploding even as the National Debt soars and the nation's economy totters. Isn't it about time to repeal the part of the law that enables unlimited, automatic increases in government spending with zero Congressional oversight and responsibility?

It's no surprised that the liberals aren't touching this one with a ten-foot pole. They like things just fine the way they are: Unlimited funds, unlimited spending, with no accountability to the people for what happens to them. "Hey, it's not MY doing that spending went up."

But should normal Americans yield and let it go with that?

Well, there you go again. It was Reagan's linking the baseline to inflation that exploded the spending.

And nearly veto proof is not veto proof, so Nixon owns the 1974 Baseline Budgeting.

 

[Little-Acorn]

The occasional disgruntled keynesian aside, apparently none of the usual liberals seem to have much to say about the constant increases in Federal spending that were enabled by the Baseline Budgeting introduced in 1974, by a nearly-veto-proof Democrat congress. With this, the Democrats achieved one of their longest-held dreams: A government in which spending would go up and up by default, without their having to do anything to make it do so.

It was Reagan's linking the baseline to inflation that exploded the spending.

And nearly veto proof is not veto proof, so Nixon owns the 1974 Baseline Budgeting.

Now we are reaping the fruits of that achievement, with spending exploding even as the National Debt soars and the nation's economy totters. Isn't it about time to repeal the part of the law that enables unlimited, automatic increases in government spending with zero Congressional oversight and responsibility?

It's no surprised that the liberals aren't touching this one with a ten-foot pole. They like things just fine the way they are: Unlimited funds, unlimited spending, with no accountability to the people for what happens to them. "Hey, it's not MY doing that spending went up."

But should normal Americans yield and let it go with that?

 

[Little-Acorn]

It ought to be obvious to even a dumbass liberal, that your economic theory is garbage.

It is VERY obvious to them. Why else do you think they are ducking, dodging, and jiving so hard now, trying to deflect attention from what they've done?