Monday, February 05, 2007

An Enron Budget, or a Casualty of War?

Clausewitz famously claimed that "The first casualty of war is truth". The truth of this remark appears to be confirmed on a daily basis.

It seems that the Whitewash House has sent down the next budget. The numbers in it are utterly huge. Naturally, defence spending is a huge portion of the suggested spending. It seems that W. thinks that he can spend a huge amount, and yet balance the budget, without putting up taxes.

Naturally, there must be some magic trick behind this claim, assuming that it is not just an outright lie (more Words of Mass Deception?). It seems that one way this trick is going to be pulled off is by hitting all those nasty Pinko programs, like Medicare. There are also 141 unnamed programs that will be targeted for cuts. The odd thing about this is that this is exactly the same number of programs W. tried to cut last year, and even the Republicans on the Hill would not let this by. The Democrats are even less likely to play ball. These cuts alone are not enough to account for the budget magic trick.

This is a puzzle. After all, we are spending millions of Dollars a day funding the ridiculous War. How can this be? What makes this all possible is a magic trick known as 'Bridge Funding'. This is funding that is appropriated, but is not part of the main budget. It is the kind of funding that is supposed to be used in case of emergency (N.B. Louisiana is still waiting to receive Hurricane funds). This is the primary means by which the war is being funded and will continue to be funded.

Consider the case of a Corporation that presented their balance sheets to shareholders, but managed to leave off substantial liabilities, or anticipated costs. When Enron did this and got caught, the result was a huge corporate scandal, rolling heads, etc. Now it seems that silly W. pulls a similar trick, and does it explicitly, and nobody turns a hair.

If the huge cost of the war is not part of the budget, then the budget is incomplete. It would be like a Corporation having a huge overseas liability that they left off the balance sheets. If a CEO pulled this trick, they would go to jail. When W. does it, he gets to make dubious claims about balancing the budget. I do not see why W. does not get sent to jail for such activities, like the Suits from Enron. But oh yes, I forgot, the folks in Washington get to make their own rules. It is a shame that it is ordinary tax payers who have to ultimately foot the bill and ordinary soldiers (who are also tax payers) who get to do the dying, whilst W. gets to keep on lying.

The CP


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