HI folks! I made a related questionL https://manifold.markets/jb456/which-prongs-of-the-333-economic-pl

Could almost resolve NO right now because the President and his administration doesn't control spending. A more accurately worded question would be "Will Trump and Elon convince Congress to cut the Federal Budget by ..."

Possible, of course, but highly unlikely. Midterms are never far away, and spending cuts directly affect constituents (both voters and donors).

Could almost resolve NO right now because the President and his administration doesn't control spending.

@DanHomerick Like Obama had almost nothing to do with Obamacare?

@skibidist you're joking, but yes, like that. A president will propose some big initiative, but then it's all about wrangling both houses of Congress to get something passed that, if they're lucky, somewhat resembles what they had in mind.

The wrangling isn't even done by the president, mostly. Sure, they're involved, but most of it is delegated to their party's House and Senate leadership. All the horse trading and browbeating and "I'll owe you a favor that you can cash in later when it comes to committee assignments ..." sausage making happens within Congress rather than from outside it, because they have more fodder for it.

The President's role is to sell the idea to the public. To make it sound like whatever change they're making is a sure-fire win for voters (and donors, never forget them...)

But where "we're gonna cut spending!" differs from something like Obamacare is that you can't cut a trillion dollars without all the people & companies who were gonna get that trillion complaining about it to their Congressfolk, the very people who are hammering out the details.

Meanwhile, Trump (unlike Obama) will immediately start throwing members of his own party under the bus when they balk at any of the suggested cuts, because that's how he rolls.

It's going to be one of the biggest squandered opportunities we've seen, I guarantee it. Republicans control all branches of government right now, but deep spending cuts will shatter any unity they might think they have.

In the end, they'll do some cuts, but nowhere near a trillion of annual spending.

Will this market consider the over-spending? E.g., the budget is cut but total government spending exceeds current levels because of consequences arising from the cuts?

i want to believe...

I made some charts of the CBO budget projections to help understand it better. Did not expect to see that Bush increased spending and Clinton and Obama cut spending!

Edit: The big drop in 2011 was when the Tea Party Republicans got control of the House, and the big drops during the Clinton administration were when Republicans controlled both houses of Congress.

@ahalekelly Clinton was famously a small government advocate and practioner.

Checkout federal employee headcount statistics under Clinton. I monitored this during his terms and stunned associates. Best kept secret in Washington since Democrats weren’t proud of it, Republicans were ashamed because it happened under a Democrat president, and the media is too lazy/obtuse to analyze any of this. So, it was a nonstory that led to four years of budget surpluses!…until W violated millenia of history by starting two wars and simultaneously passing two tax cuts. Throughout all of history, going back to ancient Rome and Greece, the wealthy have always ponied up tax funding for war. That completely erased the Clinton federal budget surplus years’ work.

The CBO's annual budget projections seem like a good resolution source, I edited the question criteria to specifically use these projections. Their mid-2024 report is available here, raw data is available on the CBO Github(!) here.

The current projection for 2024 expenditures is $6.8T, ramping up to $10.3T in 2034 (non-inflation adjusted). Expenditures pre-pandemic were $5.2T in 2018 and $5.5T in 2019, in inflation adjusted 2024 dollars.

@ahalekelly so getting it back to pre-covid levels would do the trick. Doesn't seem too hard.

@Daniel_MC keep in mind that this market and Adrian's comment aren't inflation adjusted dollars. Getting it back to pre-covid levels would be a significant cut due to that alone. As a % of GDP, it's even bigger.

That is, a cut of zero dollars counts for nothing here, but in reality is a ~2-4 % cut in inflation-adjusted spending.

@DanHomerick sure, there's a 2-4% drag from inflation. But the $5.5T is inflation adjusted. So that's $1.3T (less -4% for inflation) that could be had without finding any inefficiencies.

I think this would be a good goal for the whole 4 year term. One year seems difficult

@JamesGrugett people don't like to trade long term markets as much, but yeah I should probably make a market for that as well