SebastianJer

Budget Insanity

Posted by: sebastianjer, 12:05 PM GMT on July 11, 2012

Budget Insanity

John Stossel

Last year, Congress agreed to $1.2 trillion in automatic spending cuts, unless politicians find other things to cut. They didn't, of course. So now, with so-called sequestration looming in January, panic has set in. Even the new "fiscally responsible" Republicans vote against cutting Energy Department handouts to companies like Solyndra and subsidies to sugar producers. Many claim that any cut in military spending will weaken America and increase unemployment.
It's another demonstration of the politicians' addiction to spending -- and how we are complicit. "One more infrastructure bill" or "this jobs plan" will jumpstart the economy, and then we'll kick our spending addiction once and for all.

But we don't stop.

For most of American history, government was tiny. But since Lyndon Johnson's Great Society and the promise that government would cure poverty, spending has gone up nonstop. This is not sustainable.

Progressives say: If you're so worried about the deficit, raise taxes! But it's a fantasy to imagine that taxing the rich will solve our deficit problem. If the IRS grabbed 100 percent of income over $1 million, the take would be just $616 billion. That's only a third of this year's deficit.

It's the spending, stupid.

Even if you could balance the budget by taxing the rich, it wouldn't be right. Progressives say it's wrong for the rich to be "given" more money. But money earned belongs to those who earn it, not to government. Lower taxes are not a handout.

That's the moral side of the matter. There's a practical side, too. Taxes discourage wealth creation.

Even if you think -- despite all evidence -- that government spends money more usefully than people in the private sector, there is a limit to how much government can tax before people work less or flee.

Progressives claim a small increase in tax rates won't stop the wealthy from producing. But some would stop. When the top marginal rate was 90 percent, actor Ronald Reagan worked just half the year. He said that woke him up to the damage that high taxes impose.

Higher taxes give rich people and politicians more reasons to collude. The rich make contributions, and politicians pay the rich back by giving them tax loopholes.

That's a big loss to America. That money and creative energy spent on figuring out taxes might have gone to build new products, make music, cure cancer or ... who knows what?

Politicians promise to balance the budget by getting rid of what is wasteful, redundant or unnecessary. There's plenty of that, but they have promised to eliminate it for years. They cannot. It's just in the nature of the beast. Centrally planned monopolies do things that are wasteful, redundant and unnecessary.

What will bankrupt us first are the wealth transfers to my generation: Medicare and Social Security

When FDR started Social Security, most people didn't even live to age 65. Today, we average 78 -- and we baby boomers demand all the cool new stuff that modern medicine invents: anti-cholesterol drugs, hip replacements, etc. And we don't want to pay for most of it because we've been trained by government to assume that we're entitled to these things for free, or nearly free. We paid into Social Security and Medicare for our entire working lives, and damn it, we're entitled to get our money back!

Few of us realize that most of us get back up to three times what we paid in, that politicians have promised Social Security and Medicare recipients an impossible $46 trillion more than will exist and that our sense of entitlement will ruin America much faster than foreign aid, subsidies for NPR or foreign wars ever will.

Amazingly, we could grow our way out of debt if Congress simply froze spending at today's levels. That would balance the budget by 2017. If spending growth were limited to just 2 percent per year, the budget would balance by 2020!

But the politicians won't do even that.

It's depressing writing this. But it's not hopeless. There are examples of fiscal sanity we can follow -- if we have the will.

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Election 2012

Since April I have been tracking "Likely Voter" polls in the states that could possibly be in play in November. These are not polls of just "registered voters" but only those of "likely Voters" which are generally accepted to be the most accurate. As we get closer to the election most polling outfits will begin to poll only "likely voters" at present only a few do now. I will post the most recent of these LV polls as I find them. A (+) represents Obama is up a (-) represents that Romney is up in that state according to the most recent LV poll.

FL -1/OH -3/ PA +6/ IA +1/ NC -3/ VA -5/ AZ -13/ CO +4/ NV +8/ MO -7/ NH +3/ MI +1/
MN NA/ WI +8/ ME +14/ OR NA/ NJ NA/ NM +11/ GA +12/ SC NA/ IN NA/

BOLD are changes since 6/27 and direction of change for Obama (>)up (<) down since last poll
IA >
NH <
MI >
WI >
GA New
ME New
NM Bew
FL <

States where over 50% of voters would vote for President Obama in the above polling data:

NV 52%
NM 51%
States 45% or below for Obama
FL -1
OH 45%
IA 45%
NC 44%
VA 43%
AZ 41%
MO 42%
GA 40%

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1. sebastianjer 12:09 PM GMT on July 11, 2012
Americans' Confidence in Television News Drops to New Low Member Since: August 26, 2005 Posts: 1030 Comments: 11197

2. theshepherd 10:07 PM GMT on July 11, 2012
I've only got one question J. What budget??? A realistic budget would show the insanity of it all. So, let's just kick the can down the road, print more money, and borrow from China. Though the later is becoming a loose cannon. Member Since: September 11, 2008 Posts: 9 Comments: 8202

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