("Brad," on the phone at the Office of Management and Budget)
Hi, It's me. Yeah, I'm at the office, doing the numbers thing. It's been quite a day. Do you remember that $127 billion surplus we were all wondering how to use? Yeah, only two years ago. And how OMB had estimated the surplus would be $334 billion by now?
Well, it's the darnedest thing. We just released new figures showing a deficit. Yeah, that's right, a deficit. Oh, about $455 billion. Hello? Are you there?
Listen, it's not really that bad. Well, yes, if you want to get all technical about it, it is "the biggest budget deficit in history." But it's not like the deficit is stuck. Next year, it'll hit $475 billion, and at this rate, we project the national debt will be more than $5 trillion in only five years. Hey, five in five. Kind of has a ring to it.
It's sort of a weird coincidence, though, because back in 2000 -- you know, during the mock election -- everybody was looking forward to a decade of surpluses totaling -- you guessed it -- $5 trillion ... Yes, I suppose it is a bit of a turnaround, but we came up with a solution. From now on any time someone asks us to cite specific figures, we're supposed to say, "Give or take $5 trillion."
Still, it could have been worse. See, what we did was, we used the current surplus in Social Security to hold the debt figures down to only ... oh right, $455 billion. But, if you look at it another way, that represents only 4.2 percent of the whole economy.
Of course, if we hadn't counted Social Security, people would have seen right away that the deficit is actually closer to 6 percent of the economy. That would probably bum them out a little bit, since even during the Great Depression the deficit averaged only 3.5 percent of the economy.
Another thing we did, we looked at the $8 billion a year that normally gets set aside for federal disaster relief, and we said, "You know what, guys? Screw it. Why should we spend all that money for things like hurricanes, earthquakes, floods and other natural disasters? Who needs them?" So we knocked that off the total and, this brought it down to ... uh -- right, right, $455 billion. Do you have to keep saying that? You make it sound so negative.
Anyway, we're having this meeting, coming up with all these ways to tweak the numbers, and then one of our creatives says, "Hey, I know. What if the occupation and reconstruction of Iraq and Afghanistan were all wrapped up by, say, two months from now? That could happen, right?" So that gave us another $5 billion a month we could leave out of the report.
Wait, it gets better. We knew we couldn't make defense spending go away completely -- and why would we want to? -- so we decide to pretend that after defense spending inexplicably falls, it will then start to rise, but only by a little bit at a time. How? I get out my calculator, click in a few billion here, add a few billion there, times 52, plus my lucky lottery number, carry the billion, zero zero zero, zero zero zero, zero zero zero, and -- yada yada yada -- defense spending will increase by only $3 billion throughout all of 2005.
Yeah, I don't really know how I did it either, but everybody loved it.
Sure, sure, I know that in "the real world," as you put it, defense spending rose by $43 billion in 2002 and then by $76 billion in 2003. What's your point?
Anyway, I'm not done yet. OK, we had the numbers, and the numbers were looking really sweet. But we needed something more. Something persuasive. So we asked ourselves: What can we say to make a bad deficit sound better? Call it "manageable." Then we asked: If that doesn't work, how can we make the deficit sound like it's somebody else's fault? Have Republicans call it "spending driven."
Well, sure, the Republicans hold the majority in the House, but I still don't see what ... And in the Senate too. Fine, fine ... As a matter of fact, I can tell you just how spending-driven it is. According to OMB, spending in 2003 will equal 20.6 percent of the economy ... What's that? You say that spending from 1962 through 2001 also averaged 20.6 percent. I did not know that. Huh. Now, may I finish?
This is my favorite part -- we announced that all the tax cuts had nothing to do with the worsening of the budget outlook. Even though [rapid, incoherent mumbling and sudden drop in volume].
Oh, sorry, what I said was: Even though [mumble, mumble] ...
I SAID ... [sigh] ... Even though the tax cuts will mean a slight revenue loss. Alriiiiiight, $3.7 trillion. Are you happy now? Geeze, you're such a stickler.
Anyway, you're missing the big picture here. If you squint both eyes and then peer through rose-colored glasses as you review the report, it creates the illusion that the stalled economy will suddenly shift into overdrive at an annual growth rate of 4 percent.
Meanwhile, the deficit will seem to level off beginning sometime around, oh, the next election year, but it won't last ... Well, because after 2008, the baby-boomers start retiring, and we'll be feeling the effects of further tax cuts and the repeal of the estate tax. As retirement rates speed up, we're going to need a mint-load of revenue to pay for Social Security, Medicare and Medicaid. But by then the deficit will be growing again. And that'll cause higher debt, which will hike up government interest payments on the debt, which will drive up interest rates on everything else.
Yeah, it's going to get ugly after 2009. So you know what we did? We stopped the budget projections in 2008. Thanks, I like it too.
Hey, I gotta go. Josh Bolten, the new budget director, just e-mailed me a memo. Something about exercising "serious spending discipline." Nah, I wouldn't sweat it. I think he's mostly talking about cutting back on extras, like the infrastructure, education, law enforcement, access to healthcare, stuff like that. I wouldn't worry. Josh says all we need to do is stick with our "pro-growth economic policies" ... Well, just because they haven't worked, doesn't mean that they won't work. Hey, speaking of work ...
Well, I'm telling you, just keep pounding the pavement and sending out those résumés because any day now there will be jobs all over the place ... Oh, c'mon, who really expects unemployment to stay at 6.3 to 6.5 percent through next year? ... Well, besides the Federal Reserve ...
Yes, I know you're desperate to find a job, sweetie, and believe me, Daddy wants you to find one real soon, maybe two jobs ... Yes, and your little brother too. And the twins. That's right ... You'll all find jobs and then you'll grow up and all your kids will find jobs, and all their kids will find jobs, and if you're real, real frugal, pretty soon we won't need to have any more talks about the Big, Bad Deficit. All better now?
Shares