What, you thought Obama isn’t some big spender. To the contrary. The President announced plans to cut $100 million from the federal budget in the next 90 days by asking various agencies to identify savings here and there.
Greg Mankiw explains how laughably insignificant this is
Just to be clear: $100 million represents .003 per cent of $3.5 trillion.
To put those numbers in perspective, imagine that the head of a household with annual spending of $100,000 called everyone in the family together to deal with a $34,000 budget shortfall. How much would he or she announce that spending had be cut? By $3 over the course of the year–approximately the cost of one latte at Starbucks. The other $33,997? We can put that on the family credit card and worry about it next year.
Anything that revolves around making government more lean or efficient is going to be a failure. It’s not because the government can’t be more efficient — it could — but because the real costs are entitlements, defence, personnell and debt service. Even pork really isn’t that significant. If you’re not making serious, painful cutbacks in one of those, then you’re not really doing anything about the problem.
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