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Monday, September 18, 2006
Calling for Deficit Honesty
Columnist Allan Sloan has come out in favor of deficit figures that show the long-term consequences of our spend now-pay later fiscal policy. Today, on Marketplace:
SCOTT JAGOW: We're less than two weeks from the end of the government's fiscal year and it looks like the federal budget deficit will come in about 20 percent smaller than last year, around $260 billion. Or it could be twice that amount if you do the math the way Newsweek's Allan Sloan does it.
ALLAN SLOAN: $558 billion dollars, give or take a few buck for rounding errors.
JAGOW: Well that's about a $300 billion difference. How do we come up with that?
SLOAN: I'm sort of an old-fashioned person and I have this idea that when the government issues an IOU to somebody it's the same thing as paying cash because at some point somebody will have to pay the IOU. So by my rough math the government will have issued $298 billion of IOUs to the Social Security trust fund and a batch of other trust funds. And I expect the IOUs to be paid.
Posted by Matt Lewis
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