The Reid Plan, or how to lose and call it a win

War is expensive. No two ways about it. The cost of every soldier in a war is a loss that is immessurable to families and friends of those lost.

There is also the cost that can be accounted for. In dollars and cents, the longer a war goes the higher the tally. In fact, an extended war can be devastating to an economy – like the 100 Years War. Like Afghanistan and Iraq. The total cost has so many zeroes, as to only make sense to those proficeint in Government math.

Which are 2 things that Senate Majority Leader Harry Reid is hoping for. That a nation weary of war abroad and concerned about a debt that is beyond the combined GDP of multiple nations, will be eager to swallow a debt ceiling deal that includes an end to war. But the question that Sen. Reid and President Obama hope is not asked is, isn’t that money we were not going to spend anyway?

In yet another game of misdirection that would make Houdini applaud and Henry Gondorff laugh, the nation is being swayed by emotion rather than fact. Some might even call it a swindle.

First a few facts. The reduction that Sen. Harry Reid is calling to come from the military is based on the escalated spending that the Obama Administration put into the budget. About an extra $6.5 trillion (projected by the Obama Administration from 2011 – 2020) on top of the added $1 trillion+ from President Bush (not counting the wars at about $150 billion a year). So cutting $1 trillion over 10 years is really only a slowdown in the increase in spending. That is not a cut.

Then there is the fact that President Obama is ALREADY reducing the size and length of the wars in Iraq and Afghanistan (Libya though is entirely different). Which means that the spending, projected by the CBO at a constant rate, is incorrect. In Government math, any spending not made but planned for is called a spending cut, even if it doesn’t exist. Ending wars, or even downgrading their size, is not accounted for – just in time to announce massive saving at the next election.

In other words, in the world of real people budgets, if you don’t spend $3000 on a new set of golf clubs – that you can’t afford to buy – you just increased your wealth by $3000. Therefore you now have extra money to buy a $1500 new flat screen television – which you still can’t afford. Try that on the wife (or wives, try a similar example on yur husbands) and see what happens. See if it will work with your credit card company too.

That is exactly what Sen. Reid is proposing. By the way, in January the CBO already stated that reducing the size of the military from 2013 on would save $1.1 trillion.

“Under that scenario, total discretionary outlays for the period from 2012 through 2021 would be $1.1 trillion less than the amount in CBO’s current baseline”

So, outside of Washington DC, not spending money you don’t have, and weren’t going to spend, equates to the same thing as no money. Nothing saved, nothig gained. 0 minus 0 equals 0. The benefit to the debt? Take a wild guess.

Now consider this.

The plan by Sen. Harry Reid WILL NOT touch entitlements and spending on those programs. Ask yourself, what is the biggest problem that is fueling the increase of the debt the fastest? If you say entitlement spending, according to Democrats like former President Carter, you are a racist for opposing President Obama’s political safety net.

By the way, the other shoe that is dropping that you aren’t supposed to pay attention to is the fact that the debt ceiling, under the Reid plan, will increase by $2.4 trillion dollars. Enough money that the fact of America being so massively in debt that people would rather loan Wimpy money than America in the near-future would not have to be discussed.

Or in other words, it deflates a topical and important debate issue that President Obama cannot win, from being heard by the public when they are about to choose who should lead the nation. But this is about the national debt, not re-election and maintaining political power. Right?

If you are wondering what else the Obama/Reid plan takes money from, well there is $40 billion in savings from removing waste and fraud. Like the extra money that has been added to the cost of the Obama Stimulus – currently costing more than $821 billion or $34 billion over budget (as of Febrary 2011. For comparison, the Iraq War cost todate is roughly $750 billion over 8 years, Medicare spending was $2.9 trillion in the same time span. According to the Politifact). Waste that the Obama Administration promised to cut in 2008 campaign speeches. Still waiting for those saving? Still waiting for President Obama to go “line by line” and cut spending? We suggest you don’t hold your breath at the same time.

By the way, the saving in waste and fraud matches the end of the Obama Stimulus spending. What a coincidence right?

The Reid plan also cuts $30 billion in spending on Fannie Mae and Freddie Mac. But so far, since both companies collapsed and the Goverment stepped in with constant funding, they cost an extra $125 billion since just 2008. Total cost for Freddie Mac and Fannie Mae was targeted at $380 billion in March 2010, though some say the cost could be $1.5 trillion. So assuming the least cost, of $380 billion already planned to be spent, we will only be in the hole $350 billion by Sen. Reid’s plan. Yeah, that makes a difference there.

But maybe the best part is the $10 – $15 billion that will be saved by eliminating agricultural subsidies. It’s funny because that’s almost exactly the savings if the ethanol subsidie, worth about $6 billion, is ended. Which is likely to end if, as expected, Republicans get to control the Senate and hold the House in 2012. Even if Republicans only hold the House, the prospect of ethanol subsidies continuing is grim at best. Not that corn-based ethanol has been the wonder fuel some ecofanatics envisioned it as.

So again, this is counting on money that already won’t be spent.

In effect, what Sen. Harry Reid has offered, and the White House is backing, is giving President Obama 2.4 trillion dollars more in money that doesn’t exist, to keep spending on costs that are being reduced, and in return you the taxpayer get nothing. No savings, no reduction in the debt, no added safety to the future of your kids, grandchildren, and if America still has the money to be around, their kids as well.

This is the counter-offer of Democrats? This is the deal of the century? The answer to Moody’s threatened and sure to happen (at some point not far off) downgrade of American creditworthiness because we can’t stop spening money like a crack addict looking for a hit?

We have to say, this is the best con game we have ever seen. Considering how the White House has jumped on the plan, it is sure to have major media approval. Which is what really is on the table. Who gets to say they won the political battle – the debt burden on Americans be damned. It’s not like any of these politicians expect to be in charge when the house of cards falls down.

You can listen to the 30 second soundbites, the pundits that fawn over every word of President Obama and get all the interviews because he likes their coverage. Or you can look at the numbers and the real expectations. It’s your choice. But if you choose wrong, if you make the wrong bet, and let your elected official vote based on party line affiliation alone, don’t be surprised when the value of your house drops more – if you get to keep it.


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About the Author

Michael Vass
Born in 1968, a political commentator for over a decade. Has traveled the U.S. and lived in Moscow and Tsblisi, A former stockbroker and 2014 Congressional candidate. Passionate about politics with emphasis on 1st and 2nd Amendments.

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