This morning, the Treasury tweeted a link to a graphic illustrating "how the President’s plan raises $1.6T in revenue." Part of the graphic is a detailed listing of how the $1.6 trillion breaks down:
There are several aspects of this chart worth noting.
First, these "savings" are "10 year" savings, which comes to $160 billion per year. For those keeping score at home, the last four years have seen deficits of $1 trillion or more per year, so these "savings" barely amount to addressing 15% of the annual budget deficit.
Second, the term "savings" itself is dubious - almost all of the items listed here are tax increases. Under what perverse reasoning could these be considered "savings"?
The third and final item I want to highlight is the first item on the list which actually lists a negative $359 billion: "Tax cuts for families, individuals, and businesses." Notice the parenthetical after that: "(negative savings)". George Orwell has got to be kicking himself over that one. Does this make a tax increase a "positive savings"? And what is next? An increase in spending will be a "negative spending cut"?
By the way, these "tax cuts for families, individuals, and businesses"? These are nothing new, simply an extension of the "cuts" that have been in effect since 2001 and 2003 during the Bush administration. And one final by the way... this $1.6 trillion is only concerned with federal income tax revenues. Since payroll taxes (Social Security and Medi-care) fall outside of this definition, the "positive savings" (read "tax increase") that the Obama administration has planned by allowing the payroll tax holiday to expire doesn't need to be included in the above chart. Surprise!