Trillions And Trillions

PRESIDENT Obama’s Director of the Office of Management and Budget trailed the FY12 federal budget for the media the day before the budget was sent up to Congress on February 14. Reported Reuters:

President Barack Obama’s proposed budget for fiscal 2012 will seek to cut the record federal deficit by $1.1 trillion over the next 10 years, White House budget director Jack Lew said on Sunday.

The liberal base wants to hear about Pentagon cuts, and “A Democratic aide said the budget would reduce Pentagon spending by $78 billion over five years.” But Sen. Mitch McConnell (R-KY) told a group in Kentucky that the Obama agenda is over. “He said the Democratic president’s credentials on spending and debt “are horrible, and he earned it.’”

Nobody is yet saying that the president’s budget is “dead on arrival,” as Democrats used to say with relish in the 1980s.

Of course, nobody is doing anything about entitlements either. Not yet. However, the entitlement problem is pretty simple. Here is the CBO’s latest Long Term Outlook for the federal budget. It is now available at usgovernmentspending.com, as are the CBO’s earlier efforts going back to 2005.

This is not really that hard. Social Security, the blue band on the bottom, is big, but manageable. But federal health care costs for Medicare and Medicaid, the red band in the middle, are out of control. As you can see, the CBO analysis projects that federal health care costs will climb to 20 percent of GDP by 2084, and that doesn’t include the private share of health care costs. Obviously, Herbert Stein’s law apply. “If something cannot go on forever, it will stop.”

I was privileged recently to listen in on a couple of 80-year-old grandmothers talk about health care. These two venerable Americans demonstrate from their conversation that they count the cost of just about everything, are diligent in searching for bargains, and fearless in disputing items that fail to measure up to their standards. They are not diligent in disputing the price of their health care, only in the service they receive.

The day that America deputizes its grandmothers to ride herd upon the cost of health care will be the day that the nation’s health cost curve will bend downwards and the entitlement crisis will end. That is why the plan of Rep. Paul Ryan (R-IL) to convert Medicare from a defined benefit program into a fixed subsidy is so powerful. Imagine 20 million women working to stretch their Ryan health care benefit to the limit!

Of course, in the here and now, we have President Obama’s budget and the usual rhetoric about balancing the budget on the backs of the poor. The problem for the usual rhetoric is that, over the past two years, Americans have suddenly become more concerned about an unbalanced budget breaking the backs of the middle class.

When the unbalanced budget is breaking the backs of the middle class, in inflation and in government default, then you can stop worrying about the backs of the poor. That is because when middle-class backs are breaking the poor and the elderly will be reduced to “eating the paint off the walls.” That’s how a Polish acquaintance described the situation in the Soviet Empire in the years after the Berlin Wall came down.

The price of liberty is eternal vigilance, and that’s where usgovernmentspending.com comes in. Already, it provides a one-page view of government spending, deficits, and debt. It provides a functional breakdown of spending at the level of “trillions and trillions” and a drill-down for, e.g., health care. If you are a history buff you can look at the national debt since the day that Alexander Hamilton founded it. But now it’s time for an all-new feature: Federal Budget Analyst.

Federal Budget Analyst is based on a little known fact. Not many people know this, but deep in the federal budget’s Historical Tables are XLS spreadsheets with line-item estimates for the next five years. The way I figure it, these fearless forecasts ought to see the light of day. That means that they need to be dug out of their inaccessible spreadsheets and plastered across Google-searchable web pages. That way Google can help you find, e.g., the trend in federal health care costs for the next five years here. Or you can look at health costs for the latest complete fiscal year, FY10, and see how all those estimates in previous budgets panned out.

The fight for America is an all-front war. It needs every shoulder to the wheel. It needs grandmothers determined to make health care work for them; it needs Tea Partiers determined about cutting taxes and spending and deficits; it needs politicians up to the challenge of reading the writing on the wall.

And last but not least, it needs nerdly web tools to bring the trillions of dollars on arcane government spreadsheets out into the light of day.

Christopher Chantrill blogs at www.roadtothemiddleclass.com. His Road to the Middle Class is forthcoming.

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