PAYGO and pretend fiscal responsibility
Ed Yardeni calls it on PAYGO:
Too bad that there are so many devils in the details. Obama’s proposal for fiscal discipline totally exempts “discretionary spending” for defense, education, environmental protection and many other programs. Normal increases in entitlement spending (more beneficiaries, higher health costs, etc.) also aren’t covered. In other words, the increase in Social Security and Medicare spending resulting from the impending retirement of baby boomers doesn’t count. Congress did operate under self-imposed PAYGO rules during FY1991-FY2002, and frequently skirted them. The statute was then allowed to expire. So here we are with Mr. Obama paying lip service to fiscal disciple with yet another campaign speech.
Is it any wonder that the price of gold is at a record $1165 this morning?