On Playing with Words

Over the past several weeks, there has not been a shortage of discussions and commentaries around the debt ceiling. If nothing else, this topic demonstrates that politics involves playing the word game, which sometimes capitalizing on what the listeners do not know. For instance, let’s consider the following phrases/terms: size of government, deficit, and debt.

What is the meaning of size of government? To me, size refers to how big government is … the size of the organizational chart. On the other hand, some use size of government to refer to the amount the government spends. However, amount refers to the number of dollars involved. If the org chart remains the same, a budget decrease means the amount spent decreases while the government’s size remains the same. Of course, some also incorrectly use size of government when they actually mean the role of government.

Does the user mean debt or deficit? The two are not interchangeable terms. The recent debate involves plans for deficit reduction, but not necessary the debt. Yep, they actually agreed upon a budget decrease that reduces the rate of debt increase. That is, the debt still increases.

Deficit and surplus refer to the difference between income and spending – specifically, during a particular 12-month fiscal year. If income is greater, that’s a surplus. If spending is greater, that is a deficit. In other words, deficit and surplus only refer to a one-year period.

Debt is a long-term word involving an ongoing accumulation of yearly deficits. Interestingly, if the surplus does not cover the interest on the debt, a surplus does not reduce the debt. Even the GOP recognizes that it will take 10-years of concentrated deficit reduction to reach a point of the debt not increasing. Yep, at that point, a large debt remains.

The moral of this post is the following. As you either listen or read the commentaries, or even better, read comments and letters to the editor or comments on blogs, take note of these terms and you will notice correct and incorrect use … and misleading use.

On the Deficit Commission

Last weekend, members of the Deficit Commission met with the media. I was in my car on a cross-state trek at the time, but with the glories of XM Radio, I tuned into P.O.T.U.S (channel 132) for the live broadcasts.

Member after member spoke, and what they had to say is easy to summarize.

  • All praised the committee’s leadership.
  • Most (if not all) said good things about someone else on the committee.
  • All addressed the importance of the task.
  • All had something to say about health care, social security, and/or tax policy. Interestingly, these comments were predictable based on their party affiliation.
  • The number of times I heard “I believe” was staggering.

More interestingly is what I did not hear.

  • Not once did I hear, because of the importance of the goal, I will give up (blank).
  • Not once did I hear, what is best for the country will outweigh what is best for my party.

I heard a lot of party rhetoric. While one praises for creating social security solvency, another vows to protect social security cuts. The members of this committee brought their sacred cows to this process and were willing to have cows slaughtered as long as it was not their cows, thus a result of nothing more than political theater as the committee failed to approval a proposal.

Rather than facing the challenge and accepting a sacrifice, too many members stood guard in their political rut in order to protect their interests/ideology. The current Capitol Hill climate favors continues to define seizing the moment as compromise agreeing with my interests and beliefs over any pragmatic common ground.

This committee started an adult conversation about the federal deficit, but the report did not make it out of committee because no enough adults were present. Hmmmm … the apparent agreement on the tax cuts that aren’t paid for is interesting timing.

Thank you John Avalon for this column.

On Double Standards and Deficits

Presumably, our elected representations are facing voter anger. Presumably, American voters are tired of Washington’s inability to reduce the federal deficit. With the possibility of majority changes in one or both Capitol Hill chambers, the news is running rampant with various polls regarding the upcoming election. My take – what a bunch of crap!

All of the House of Representatives’ 435 seats are on the upcoming ballot. As analysts focus on the 100 or so seats that are up for grabs, 335 are safe. On the Senate side, voters will determine the fate of 37 seats; the majority of incumbents are safe. If voters are angry and fed up with our elected representation, why will the majority of incumbents get re-elected? Obviously, voters must be fed up with others representatives rather than their own.

Deficits, a 40-year trend, occur when expenses exceed income. I firmly believe that voters believe that our elected officials need to get control on the spending. The real point of contention is finding agreement of where to cut the expenses while determining how much. Even without special interest influence, what is good for some is probably bad for others. In other words, who is to sacrifice?

As extending the Bush tax cuts remains a current debate, one fact remains fixed: taxes are the major source of government income. Republicans love the cut taxes mantra, but would you go to your boss asking for a cut in pay if you were operating a personal deficit?

Interesting, conservatives are now Great Britain’s party in power. Although they do not have a majority, conservative leadership is approaching their deficit with a novel two-prong approach: cut expenses and raise taxes. Besides these recent columns by Ruth Marcus and David Broder, seems I mentioned this approach in October 2008 in relationship to the Obama-McCain campaigns. Thus, I continue to maintain that much of America wants leadership capable of making tough decisions that are contrary to campaign rhetoric and party ideology.

On Opinions in the Shorts: Vol. 35

On a Contrarian Deficit
I’m not wild about the size of the federal deficit or its growth rate; nor do I blame any one political party. Nonetheless, this Paul Krugman column made me think and think about the deficit in a different way.

On a Passing Giant
We get a chance to relive history and moments anytime a major public figure dies – and the ups and down in the life of Edward Kennedy was no different. He was both a saint and a sinner, but aren’t we all. As a local friend said to me, “He grew up late in life.” I was touched by the young Kennedy of today with their role and words during the Prayers portion of the service. I was touched by comments from Sen. Orin Hatch and Sen. John McCain. I smiled when Senator Hatch explained how he went to Washington to slay Kennedy and his likes, but instead got a true friend. I enjoyed seeing the former presidents seated together near the front because they only get together on special occasions. And I appreciated these columns by David Brooks and George Will.

On a Site of Remembrance
I can’t recall what I was watching to directed me to this site, but here’s a not-so-well-known site run by the government about terrorism and fights for liberty. With 9-11 approaching, this well-done site is worth noting.

On Confirmation by Columnists
Last week I commented on Afghanistan, and this week George Will writes an interesting parallel. Also, on more than one occasion I have mentioned that President Obama losing support from the center and the need for him to recapture the center.  (Most recent). Thank you David Brooks for your column confirming this.

On Real Men of Genius
The Bud Light “Real Men of Genius” radio commercials crack me up. Did you know over 100 have been made? Better yet, here’s a site with all of them. #32 causing me to lose it each time I hear it.

On Fight Songs & Nicknames
Kickoff to the college football season now opening, here’s a site for all college fans – a site with all the fight songs and spirit songs all schools in the major conferences.  This past post features a different look at school nicknames.

On a Lighter Note
Here’s a tune from One-String Willy who plays a guitar with one string.

Federal Budget: Part 4 – The Dilemma

Economics classes taught me that one role of government is to prop up the economy during tough times as is being currently discussed. On the other hand, a fiscally-balanced government is the assumption.

Even without financing the $700 billion, does either candidate address the deficit? With the rescue/bailout, what will the candidates cut from their proposals? As the first debate demonstrated, both candidates struggled with this question, even with moderator Lehrer phrasing it three ways. Then again, can (or even should) our government attempt to balance the budget in a recessionary environment (if it occurs or is here)? Can the government overspend trying to stimulate a recessionary economy?

Both candidates are relying on job creation; and how will this be financed? On the other hand, since job creation also creates a revenue stream and spending, is it self financing?

Both candidates draw upon American ingenuity when emphasizing non-oil-based energy needs. This sector may need government stimulus to accelerate the development. From where will the money come? How many jobs will it create? What is the return on investment?

Are either of these candidates and their party addressing the deficit and demonstrating fiscal responsibility? Will economic conditions hinder government stimulus spending? Are both parties and the presidential winner ready to lead during recessionary times for the benefit of the collective?

So many questions, yet so few answers beyond partisan politics as usual.

Other posts in this economic series: History, Revenue, Spending