Today, to much fanfare, the administration released its ridiculous $3+ trillion budget (we say + because at that size the one thing certain is that the budget will certainly never hit the target and while we wish it would be lower, we are certain it will end up materially higher), which consists of a “short” 192-page summary section and a 1420 page appendix. We are confident that not one politician will read the whole thing from cover to cover. We won’t either. Not because we don’t care about what’s in it, but because we are much more concerned with what is not included, namely $2.8 Trillion and $1.9 Trillion of MBS guaranteed portfolios at Fannie and Freddie, and an additional $782 billion and $809 billion in company debt outstanding for the two GSEs, respectively. This amounts to a total of $6.3 trillion in liabilities which should be counted toward the budget. And yet, oddly, the error-checker somehow made this rather justifiable omission: after all if we were to look at a number which written out looks as follows $6,264,000,000,000.00, we would also probably just avoid it – it is somewhat difficult to hide a number that big even in the 1,420 pages of the budget’s appendix. That’s ok, we are here to remind them about the omission, and also to remind Mr. Orszag, who himself, in that long ago 2008, espoused that these companies should be put on the Federal Budget. Isn’t it strange what one and a half years worth of realizations just how broken beyond repair the system is, will do to one’s convictions?
Read the rest for yourself at the link above. It’s enough to make your head spin.