Maybe Hubbard doesn’t understand what a deficit is

September 19, 2005

Allan Hubbard, the director of Bush’s National Economic Council, joined Scott McClellan on Friday for a press briefing, and helped respond to a variety of Katrina-related questions. One exchange, in particular, stood out.

Q: So where does the money come from? Obviously, you’ve got to borrow it or offsets in the budget, what?

Hubbard: Well, again, the money [for Katrina relief] is going to come from the federal government, it’s going to come from the federal taxpayer. This President is committed to, as you know, cutting the deficit in half. This in no way will adversely impact his commitment to cut the deficit in half by 2009. (emphasis added)

You’ve got to be kidding me. It’s just the latest in a long line of examples in which the White House is either entirely disconnected to reality, playing the public for fools, or both.

First of all, the president’s “plan” to cut the deficit in half by the end of the decade has always been something of a joke. Long before Katrina even formed, the Congressional Budget Office reported a bleak deficit outlook in the coming years, with projected deficits never dipping below $330 billion over the next 10 years and a total of $4 trillion being added to the debt between 2006 and 2015.

Second, how, exactly, does Hubbard figure a $200 billion relief effort will have no adverse effect on reducing the deficit? There are three choices: cut spending, raise taxes, or add Katrina-related costs to the already-huge deficit. Bush won’t raise taxes and Tom DeLay said there’s no spending to cut.

And yet, there’s the president’s top economic advisor, explaining that dealing with the worst national disaster in American history will “in no way” undermine Bush’s commitment to cutting the deficit by hundreds of billions of dollars.

There was no subsequent explanation, but I have a follow-up: Mr. Hubbard, how’d you say this with a straight face?

I think you are confusing ‘commitment’ with ‘realistic plan’. What’s the former got to do with the latter?

  • He can say this with a straight face because he’s a Bush Republican. They have no shame, because if it comes from Dear Leader, it must be correct. Don’t bother a cult member with facts.

  • These people need to get honest with the American public. Every day that we run a deficit means that we are borrowing the money to keep the wheels of government turning. People need to realize that we are financing this drunken spend fest with money borrowed from China and several other countries. While the clock is ticking the interest we owe on our public debt is accruing. When the hangover hits things aren’t going to be pretty.

  • In his blistering critique of republican leadership, Leaders Who Won’t Choose, Fareed Zakaria nails the obvious:

    People wonder whether we can afford Iraq and Katrina. The answer is, easily. What we can’t afford simultaneously is $1.4 trillion in tax cuts and more than $1 trillion in new entitlement spending over the next 10 years. To take one example, if Congress did not make permanent just one of its tax cuts, the repeal of estate taxes, it would generate $290 billion over the next decade. That itself pays for most of Katrina and Iraq.

    Zakaria is anything but a liberal. His knockdown of republican DC is a must read.

  • Scary thought – turn the question around. How does another really $200B effect Bush’s “plan”? If the “plan” is to lie through your teeth, what changes?

    -jjf

  • >>Every day that we run a deficit means that we are borrowing the money to keep the wheels of government turning.

    The government money does gets spent – but it ends up going as interest payments to the upper class/investment class rather than as governmental services to the rest. Just how many $10,000 US treasury bonds do you think those left behind in New Orleans really owned?

  • They simply won’t include funding for post-Katrina cleanup in the budget same as they haven’t included funding for Iraq operations in the budget. They’re “off-budge expenditures”. They’ll just call Congress every few months looking for a handout. The money goes directly on the national debt without the inconvenience of adding to the budget deficit.

    Jeez, I wish I could get away with managing my household budget the same way these people handle the federal budget.

  • I think you, like many commentators, are missing the main point: this Administration does not appear to believe in government as being “good”, and therefore does not approach it as if the Administration has to safeguard government and act as a trustee to protect it on behalf of the people.

    Government is seen by them as an alien force.

    Therefore, by definition, impoverishing it, weakening it, loading it down with debt, are “good” things, moral things, reconciliable with Christian duty. Increasing its strength – in civil areas, unlike in military areas – is a “bad” thing, immoral and un-Christian.

    So, running up massive deficits is morally good, and does not matter. If some time in the future, it is difficult to pay off such debts, then tough: the people at that time will have to tighten their belts and do without a lot of government services, just as every family should. The people will have shown their “unworthiness” by receiving all those government goods, and will have to pay the piper.

    The fact that the government is being driven into debt by inept management on the part of this so-called “business” administration is a fact they easily ignore, because they do not believe they have a fiduciary duty to handle the government’s finances in a competent manager. Plundering it in various ways, to help selected interests, is morally defensible to them.

    And few politicians dare call them to account for these immoral acts.

  • Mother Nature (and Iraq) have given this administration what they wanted. A way to spend scads of money – unquestioned (or mostly so) and stick to their tax cuts/not raising taxes so that they can strangle the rest of the budet so it can get so small Grover Norquist can take into the bathroom and drown it. Grover has got to be smiling.

    Then there is reality.

    Of course my fear as that the first scenario is going to beat up on reality and common sense.

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