Tuesday, April 21, 2009

Obama Cuts $100 Million in Spending

I am always amused by how those who understand math and have a sense for numbers can use that to befuddle those who don't. You can see it all the time on TV ads for pay-day loans or cash now for your structured settlement payments. In both cases, people who can do math are making a lot of money off of those who can't (or choose not to). In a lot of ways, politicians do the same thing. Bush and Gore argued over "fuzzy math" seemingly non-stop in the 2000 presidential election. Here in Colorado last fall we had a "right to work" ballot measure where both sides claimed widely different numbers as far as the cost of passing or failing the measure, and when a local news channel did the math, it turned out that both sides were using ridiculous estimates.

The latest example, from the Associated Press, reads "Obama orders Cabinent to cut spending by $100 million". To someone who can't or won't crunch the numbers, $100 million looks like a lot of money. But when compared with the size of the federal budget it amounts to a 0.0025% cut in spending. In fact, that cut is well within the projected error in the budgeted expenses and income for the government for any given week. However, since most people have a hard time appreciating the difference between a million, a billion, and a trillion, it looks like Obama is working hard to cut the federal budget and save the taxpayers money.


  1. Let's put this into perspective. If you were living on a budget of $40,000 then Obama's budget cut would be like reducing your budget by $1 to $39,999.

    WHOO! Act now and you can get a federal budget for $39,999! That's right $39,999! These savings are HUGE! You may never see these savings AGAIN!

  2. First, you are right, it is almost nothing. People may get confused.

    Now if you are trying to criticize Obama making such a spending cut, I say this: Guys, this is the classic: "since somebody is doing something that isn't a significant contribution than it is pointless" fallacy.

    How many great things in life are funded by the "widow's mite"? (Cough, churches, charities, countries, Cough).

    If every separate entity getting this money, governors, agencies, etc... cut 100 million dollars, the total cut would be in the several billions category.

    Instead of doing this they complain they are getting money publicly, then accept all of it later. Maybe we need more politicians like Obama.

    Should the person cleaning up trash on one section of one freeway in the world be criticized for his work? It's less than 0.01%? If everybody did this, it would be a great thing.

  3. First of all, I think it's great to cut spending, but Joe even you have to admit that this is not a serious attempt to reduce spending - it's an attempt to use big numbers like $100 million to give the impression that he is actually doing something. To use your trash analogy, if you consider the massive budget increases Obama has proposed, then he's dumping a truckload of garbage on the side of the highway, picking up a gum wrapper and holding it up as an example of how he's going to clean up.

    Now I don't mean to single Obama out unfairly. Politicians (and many others) do this sort of thing all the time and they get away with it because we, as a nation, are generally bad at math. John McCain made a big campaign issue last November over a $1.3 million planetarium projector in the name of saving the taxpayers money. These things only work because most people in the U.S. can't appreciate the difference between millions, billions, and trillions.

  4. Nick, what you failed to mention is the garbage in the garbage truck is magic garbage with wonderful healing powers. All of it except the toxic gum wrapper that was destined to poison the whole human race.

    I do agree that these things are often numbers just to work on people's psychology for political purposes. And also, I'm sure there might be some of this in what Obama's doing. 100 million is the kind of number to do just this.

    Everyone, who knows what they are talking about, admits we need a stimulus of some sort. Now, if the spending is higher than it needs to be, as many argue, people getting the money should find ways to make cuts if they can. There is nothing stopping them. They can always put money where their mouth/criticisms is/are.

    PS. I smiled at your garbage truck analogy and said touché.

  5. "magic garbage with wonderful healing powers"? Ummm... Joe? Are you doing ok? First of all, no one was talking about the stimulus package. Second, this isn't a devoutly pro-Obama blog. We can have dissenting opinions if we want to. Third, "magic garbage with wonderful healing powers" and "the toxic gum wrapper that was destined to poison the whole human race"? I have to admit, you made me laugh, but are you sure you're feeling ok?

  6. Hey, I am a fan of magic garbage - especially since quite a bit of that magic garbage is headed to funding science. Finally a gravy train I can get on board!

  7. Bill, I hope you realize the "magical garbage" was a joke. Second, I have never stated this is a pro-Obama blog. Third, I don't try to discourage people from expressing their opinions. I rebut, but never try to stop people from expressing their opinions.

    Politically, I take a very scientific route: (In my mind) Conservatives had their 8 years of running the government, and what do we have to show for it? To use a Regan style quote: how are we better off than we were 8 years before? Conservative political theory has been discredited.

    Now, Obama's "political theory" hasn't been tested adequately either, but supporting the same conservative theories which clearly have failed is to do bad science.

  8. Yes Joe, I knew it was a joke. I hope you also knew that my comment was taking advantage of an opportunity to make a tongue-in-cheek comment myself. Even though I disagree with your political conclusions, I also had no intentions of being politically polarizing. Personally, I'm also all for the gravy train heading this way. Sorry for any misunderstanding.

  9. My last quote was too general, much conservative doctrine has been shown to be a good thing, but a lot that emerged in the last 8 years turned out to be toxic.

    Example: Bush tax cuts + deregulation has been discredited as a bad theory, pretty much only supported by conservatives today.

    I don't think you can support these ideas. However, there are always the scientists that cling to their theories no matter what happens. These people become crack pots.

  10. Bill, I am sorry too. You weren't polarizing and I was just having a knee-jerk reaction.

    I have to admit I went overboard.

  11. It's ok Joe. Personally, I just thought the "magical happy garbage" was just too good an opportunity to pass up. Thanks for the interchange of comments.


To add a link to text:
<a href="URL">Text</a>