Inside the Beltway: Where an Increase Becomes a Cut

Bill Tatro
|
Posted: Aug 01, 2011 12:01 AM

I just love Washington-speak which offers heartfelt phrases such as “baseline spending,” “debt ceiling,” “drop dead dates,” and my ultimate favorites, “the cut,” “to cut,” “a cut,” or just simply “cuts.” 

Like the phrase “beauty is in the eye of the beholder,” a “cut” means different things to different people. 

Let me explain by first discussing common-speak, which is very easy to understand. 

When someone takes a cut in pay, it could mean going from $20 per hour to $15 per hour.  Or, they’re paid $30,000 per year for a job that used to pay $35,000 per year. 

To most Americans, it also means reducing the amount of groceries purchased with the same cash outlay as before. 

These are real cuts. 

Simply put, a reduction in what was spent, or earned, the year before.  A cut is easily understood and accepted by all until it gets to the Beltway, and then it becomes Washington-speak. 

How does this happen? 

Here’s an example.  Cut a credit card into little pieces.  The action in and of itself doesn’t have a financial effect, but it does stop you from using the card again. 

Thus, you haven’t done anything to reduce credit card debt, other than stopping you from increasing it. 

 No card, no spending, no increased debt. 

So we’ve cut the card, but not the debt. 

However, now you can proclaim that you’ve indeed made “cuts.” 

Ah, Washington-speak. 

Get the idea? 

Here’s another example, my neighbor’s wife. 

An avid shopper, one day she exclaimed to my neighbor “Gee, honey, I think you’ll be really happy, I saved you $200.” 

“My favorite dress shop had a sale and the dress I purchased was reduced from $700 to $500.” 

Therefore, her idea of taking $500 out of my neighbor’s pocket, instead of $700 (resulting in a $200 savings), was a “cut in planned spending.” 

Yes, Washington-speak once again.  You get the point.     

The argument regarding budget cutting is not about actually freezing spending at a certain level and then reducing from there. 

Rather, it’s about slowing down the rate of growth and calling it a budget cut.  For years, the bureaucrats knew that in order to maintain their budgets, they must spend everything allocated. 

If they didn’t, they would have to take the proverbial cut the next year. 

For instance, a 10% annual increase would only be budgeted for a 5% increase if the full 10% had not been spent the year before.  However, it was still a real 5% increase, but for the purpose of politics it could be trumpeted as a 50% cut! 

Hooray, a major cut!  Bipartisanship!  Let’s all do lunch! 

In other words, Washington-speak at its finest. 

Until the politicians are on the same page as the American public, and both are speaking the same language, all the drama and all the fanfare will result in absolutely nothing being accomplished. 

And that’s my-speak.    


See these top stories from Townhall Finance:

Bill Tatro Inside the Beltway: Where an Increase Becomes a Cut
John Ransom Eat Those Peas Mr. President
Mark Baisley How the Hobbits Take Washington
Mike Shedlock This is a Downgrade Deal
Bob Beauprez Eric Holder's Newest Witch Hunt
John Ransom Email, Hate Mail and Comments from Readers
Email Ransom thfinance@mail.com
Facebook http://www.facebook.com/bamransom
Twitter http://twitter.com/#!/bamransom