Monday, February 14, 2011

Where to cut the Federal budget

The chatterers were breaking out in rashes, boils, and stigmata on yesterday morning's political talk shows. 
We have a 14 trillion dollar debt. 
This year's budget deficit will be 1.5 trillion or so. 
The primary amusement on Meet The Press yesterday was David Gregory trying to get John Boehlout Boehner to admit that he would do anything significant, anything at all, to improve the situation.
We are broke, broke, broke.  End of story. 

Obama has proposed a plan that will chop 1.1 trillion from the deficit (not the debt, just the yearly deficit) over a ten year period. 
Good lord in heaven, can you imagine what that hole will look like ten years from now? 

Here's a chart on where they're doing the spending.  Or at least where it is budgeted.  Various politicians are slowly coming to terms with the fact that our military couldn't survive an audit. 


I'm a shipping manager.  I have no background in economics.  But I read a lot.  The path we're on is very well marked.  Would it hurt us to stop borrowing from China and expecting our grandchildren and great-grandchildren to pay all this back? 

We could confiscate every penny from the infamous top 5%, and use the money to continue paying for Bridges To The 21st Century, for "Investments" In Infrastructure, and Winning The Future. 
All it would do is continue to scare the Bejeebers out of anyone considering investing here.  Including you. 

Let's start at the top of the dial, and work our way around the chart. 

In the top right corner, we have Social Security.  Is there anyone who thinks Social Security will be around in 25 years?  Anyone?  Anybody?  Didn't think so.  It's broke as the 10 Commandments.  What would be so horrible about continuing to pay the current retirees with money from the Chinese Benevolence Fund, and taper off the expected payments to, say, everyone under 50 ?  Raise the payoff age to 70.  That would get the life expectancy-to-payoff-ratio close to where it was when FDR got drunk and came up with this scheme. 

Next we have the Department Of Israel, South Korea, Germany and The Philippines Defense (from the 2:00 to 4:00 section of the chart).  We have more military than the rest of the world combined.  China is in 2nd place, and our military is six times larger than theirs.  Cut the military by 50%.  Bring the remaining boys and girls back to the house.  Defend the borders.  Do you think our manufactured products might be more attractive to the rest of the world if Asian manufacturers had to pay a little more in taxes to provide for their own defense? 

From 4:00 to 7:00, we have a mis-named category called "Unemployment, Welfare, and Other Mandatory Spending".  Save it for the mentally ill, the injured, and the elderly.  Give everyone else a bumpersticker that says "Don't Breed 'Em If You Can't Feed 'Em."  Think of how much private charity would be available if we didn't have to funnel so much aid and assistance through the current collection of inefficient government programs.  I'm all for compassion, and when I'm old and broke and feeble, I hope someone gives me some.  I just don't want to force anyone to do so. 

From 7:00 to 9:00 we have Medicare and Medicaid.  Go here for a Free Market proposal to cut medical costs in half.  Stop protecting the medical and pharmaceutical monopolies with regulators and barriers to entry.  Open up the market to more competitors and watch the costs go down.  It worked for telephone service (now almost free) and air travel (thank you, Jimmy Carter) and trucking (thank you again, Jimmy Carter). 

At the 9:00 mark, we have interest on the national debt.  Let's stop borrowing. 

These are the categories that our politicians have previously regarded as "untouchable", "off the table", and "the 3rd rail of American politics".  They are also the only areas big enough to cut and make a difference. 

Can anyone think of any other ways to get out of this mess? 

The piper is coming, and he wants to get paid.  Please hurry. 

Oh, one other thing....Any politician who doesn't favor nuking the Departments of Energy, Agriculture and Education is not a serious person. 

1 comment:

Nick Rowe said...

I'm in full agreement, except for the military.

We have 1.5 million soldiers, which is one-half of one percent of the nation. And 60% of those are in the National Guard and Reserves. It's a paltry force even when there are no wars going on. Our military serves as a deterent, just by being trained and ready.

I submit that bin Laden wouldn't have had the balls to attack us if he hadn't seen us reducing our military every year of the 90s. We retreated, he expanded.

I know this is a drop in the ocean, but you brought this up in an earlier post: Republicans cut 100% of NPR and PBS funding from their budget. As much as New People's Radio and the People's Broadcasting Service claimed most of their funding came from private donors, now they're saying some or all of 900 stations may be shut down from the cuts.

I'm sure Sesame Street, Car Talk, and Lake Wobegone will find lucrative homes on private stations where they will earn their keep with advertising instead of begging.