Monday, April 12, 2004

Cute, but fraudulent

I am not sure what this budget 'simulation' is trying to demonstrate, but it does nicely highlight how the government's cash accounting system is useless, and how someone talking about the budget in cash terms is committing outright fraud or honest error, depending.

If you make no changes and ask to see where things stand budgetwise, you get Military Spending ($399.7 billion) about equal to social security ($498.84 billion). In fact, after the Iraq war is over, one would expect to see Military spending decline, but social security is set to explode as boomers retire and then refuse to die. In honest accounting terms, social security and medicare make up about 2/3 of the US government's obligations -- many times annual US GDP. Somehow the author of the site seems to think that Enron's accounting was crooked, butthe government's is not. Bizarre.


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