Sunday, April 12, 2015

Government Lies About Spending and Intentionally Bad Accounting ... There Is No Such thing as Free Money ... Not for Anyone ... Government Truth Telling About Financing Simply Doesn't Exist

Although not all, the vast majority of U.S. government officials at the local, state and federal levels make up their own rules about truth telling. They lie, in other words.

They seek to get and stay elected by telling us what too many of us want to believe and what they believe they need to say to remain in office. And We the People allow them to call this sham and charade public service.

So let's prepare to get ready for more and more of this happy talk as enter the upcoming and far too lengthy presidential and congressional 2016 election seasons.

Take government spending and savings on student loans, for example.

Now we're asked to believe that college can be free for students if taxpayers will only foot the bill. But this is pure nonsense.

Even if taxpayers aren't required to pay up immediately and government borrows or prints the money instead, the money isn't free, and especially not to the intended recipient or beneficiary. Eventually the young will become older and be forced to pay the bill in the form of higher taxes, a lower standard of living, or a slower growing economy. That's what happens to a government dominated debt ridden society.

So the next time you hear about free community college, the Affordable Care Act, free public education, Medicare cost control or anything else, take a moment to consider that free lunches don't exist --- not even for those who are the immediate beneficiaries. The bill will come due down the road, and if we don't pay it, our kids will.

Ending Federal Loan Fraud tells the government's 'Gruberish' story simply and succinctly:

"‘We’ll try and balance the budget in a 10-year period,” said Senate Budget Chairman Mike Enzi (R., Wyo.) in January. “And we hope to do it without gimmicks and bad accounting.” That last point is crucial. Avoiding behavior that would get a private citizen sent to prison seems a reasonable aspiration for elected officials ....

A great place to start is the accounting for federal lending programs which deliberately understates their risks. Readers may have noticed that every time federal student-loan subsidies expand, liberals like Senator Elizabeth Warren (D., Mass.) hail it as a taxpayer windfall. She gets away with this because administrative expenses and market risk aren’t included in the loan cost estimates.

“The government is exposed to market risk when the economy is weak because borrowers default on their debt obligations more frequently and recoveries from borrowers are lower,” explained the Congressional Budget Office in a report last year. “When the government extends credit, the associated market risk of those obligations is effectively passed along to taxpayers, who, as investors, would view that risk as having a cost.”

They sure would. CBO reported that while the Department of Education’s four largest student-loan programs were expected to yield an official savings of roughly $135 billion from fiscal 2015-2024, the programs would likely cost taxpayers $88 billion under fair-value accounting practiced outside the Beltway.

An official $14 billion projected taxpayer gain at the Export-Import Bank was revealed as a $2 billion projected loss. And the official $63 billion bonanza expected from the Federal Housing Administration’s single-family mortgage guarantee turned out to be a $30 billion taxpayer shellacking.

Mr. Enzi’s office says he supports fair-value accounting for federal credit programs. His House counterpart, Rep. Tom Price (R., Ga.), has been shining a light on this government racket for years. Now they can do something about it by using the budget resolution to require that CBO practice honest accounting in official scores of legislation."

Summing Up

Do our government officials in effect lie to We the People?

Of course, they do. Every single day. It's called politics in today's America.

And they get away with it simply because we allow them to do so.

It also makes their political lives easier not to deal with the eventual and long lasting negative consequences of their actions on We the People in general, and the next generation of Americans in particular.

How long will We the People put up with this? While I don't know that, I do know this --- it's been far too long already.

At least that's my take.

Thanks. Bob.

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