It’s time for an episode of “Shit my Government Says.” The premises here is simple, I take a common line used by those in government and translate it into layman terms. Today’s episode is going to be on “reducing spending.”
When a government official says they’ve proposed a plan to reduce spending they want you to believe they’ve saved you money by spending less. For example if they put forth a budget and claim it reduces spending by $100 billion it implies they’re doing to spend $100 billion less than they currently are spending.
What they actually means is they’ve cut something from the proposed budget but haven’t actually saved you any money yet. When a government official says they’ve cut $100 from the budget they mean the proposed budget for a span of time. Therefore if the proposed budget is $1,000 over money actually available and they “cut spending” by $100 the budget as passed will still spend $900 more than they have.
This seems altogether obvious until you apply the fact out government increases the budget from year to year. Let’s say the budget in 2010 was $100 the and likely proposed budget for 2011 will be $110. Let’s say the income of our government for 2010 and 2011 was $50. This means in 2010 our government spent $50 they didn’t have which we call a deficit. Now our government is claiming they’re going to get spending under control and thus will not pass the proposed $110 plan but instead have cut the proposed budget by $10. That means out government is still going to spend $100 or $50 over the amount brought in making the deficit the same as in 2010.
Of course the government officials will pat themselves on the back for cutting spending by roughly 10% (since government always likes to round up even when that rounding makes little sense mathematically). This is meant to imply they’re only going to spend $90 for the year instead of the $100 they spent last year.
It’s a deceptive practice that many people seem to be completely oblivious to.