Bush Approves Transfer: America Adds $8 Billion in Debt

From the AP (via Forbes):

The bill transfers $8 billion from the Treasury’s general fund to shore up the financially teetering highway trust fund, which supports road and bridge projects around the country. In July, the White House threatened a veto, saying taking money from the general fund was “both a gimmick and a dangerous precedent that shifts costs from users to taxpayers at large.”

Supporters of the transfer argued that the Treasury was merely returning $8 billion it took from the then-prospering trust fund in 1998 for deficit reduction.

So basically, to cover “paying off the deficit” back in the 1990’s, lawmakers took money out of the highway trust fund (the checking account where all the gas tax revenues go). Which is funny because I thought the budget surplus was from income tax revenues, but I guess everything gets included in this. So now that the Schumer hits the fan (I swiped that from www.survivalblog.com, which I think is a great euphemism for the actual phrase, if not accurate), the money gets “loaned” back. Of course, this just means that whatever “debt reduction” is done is actually just been eliminated. Awesome accounting guys.

But this also means that the states get their precious highway money, construction companies’ political contributions and lobbying did not go in vain, and whatever useless highway projects that this money is being spent on can continue. At least until next year.

What I also found interesting is that one proposal floated by the Bush administration was to reduce the MASS TRANSIT portion of the trust fund. Motorists, you’ll be happy to know that your gas taxes are going toward those empty regional transit buses you’re stuck behind on the road. Of course, the Democrats wanted nothing to do with that, being that they love mass transit, even if it is cross-subsidized by motorists.

And the same thing has already happened with Social Security. The government has been using the money in the SS trust fund to pay for the usual stuff. So in about 2020, when the trust fund starts to run out, the government will just “get the money back” from the Treasury, since it was already “loaned out”. So don’t worry, Social Security WILL BE SAVED. You’ll just end up paying 50-80% income taxes to do it.

Government: The largest legal Ponzi scheme ever created.