For those who are highly partisan one way or the other politically, My comments are likely to upset you again. Notice how I said that – folks on both sides are equally pissed off.
I’ve said before in my blogs that although I’m registered as a Republican, most modern Republicans don’t like me saying that – I’m not “their brand†of Republican.
I think for myself rather than blindly following the orders given by the elite masters in charge of the party. Lest someone think I’m picking on Republicans, the Democrats have their own version of elite masters telling Democrats what to think and say as well. Everybody nice and pissed off already?
I want to talk about the budget today, in terms simple enough for me to understand. Those who are zombified by their party elite will spout whatever trash they’ve been fed, but the reality of federal budgets is a lot less partisan than the elite would like us to believe.
There are several good sites out there that a person can use to explore what really makes up the budget, and how we might re-prioritize how we spend our federal dollars. This is the part we need to focus on – the spending side. Here are a couple sites where you can try your hand at it:
Center for Economic and Policy Research
The Committee for a Responsible Federal Budget
What you’ll find is that depending on which site you use, there are some constraints on what your options are. I found that in some cases, I wanted to do parts of some options rather than the whole thing. That’s OK – you can still get the message.
And the message is this: We’re in deep dodo. All those partisan talking points about getting rid of one program or the other have almost no real impact on the budget as a whole. To have any real impact on the budget as a whole, our options really come down to these:
- Dramatically revamp how we spend money providing physical defense of our borders, in order to bring significant reductions in defense spending.
- Dramatically revamp how we spend money providing social defense within our borders on what are called “entitlement programsâ€, in order to bring significant reductions in entitlement spending.
- Return our federal income tax structure to something that looks more like the tax structure that we had in place during the 50’s and 60’s in our country.
There are two sides to the budget – money coming in and money going out, right? Just like our household budget. Congress is in complete control of whether or not we need to go into debt each year, because they decide how much we spend, and how much we take in.
As you look historically at the debt in our nation, remember that the debt is really very simple – the President works to set an agenda, and may propose a budget, then the President and Congress negotiate to arrive at spending priorities. This defines how much gets spent. The income side is even more simple – tax legislation defines how much revenue the government takes in to fund these things we’ve decided we want to spend money on.
Congress and the President work together, and they decide whether or not they want to plunge the country deeper in debt. Every year.
Starting in around 1980, Congress and the President started to get the notion that higher debt was really more OK than it had been in the past. As a Republican this makes me very ashamed, because this precedent began under Republican leadership. Of course, Reagan had the help of Democrats who let him set this agenda – an agenda based on this newly coined “Trickle Down Economics†notion. (A notion that George Bush senior described as Voodoo Economics).
History has proven George Bush senior right on this. Our country was in stagnation caused by the efforts of the Fed to curb inflation. When I bought my first home back in 1979 or 1980, my interest rate was something like 10% or 12%. Rates like that would plunge our country today into receivership. Thank goodness that at the time, our economy was strong enough to withstand such pressure.
At the time, folks were living pretty well. Wages were high, and unemployment was fairly low (by today’s standards). But our leaders were terrified of inflation, and in the latter part of the Carter administration, The Fed attacked inflation with a vengeance, driving interest rates up to those crippling rates.
During the Reagan administration, when the Fed began to lower interest rates, the economy picked up again. Just like today – look around at what has kept our nose above water for the last decade – incredibly low interest rates.
That part’s real simple. But then, while we were digging out of the mess that the Fed created, the neoliberals decided to try selling us the great fiction of the 20th century. They pedaled this notion that by lowering tax rates on the wealthiest Americans, you’d stimulate the economy. They timed it perfectly, because as the economy picked up as a result of falling interest rates, folks started to buy into the Voodoo Economics that they’d been sold.
In reality, while you can always get someone in the scientific or economic community to agree with nearly any wacko theory, the preponderance of credible economists will agree that tax rates have far less effect on economic stimulation than we were led to believe.
Use common sense to think about it. During the 1950’s, the American economy was booming and growing. Most folks see it as the real heyday of our “American Dreamâ€. Underneath that robust and expanding economy were federal income tax rates as high as 94%. That’s right – the highest tax rates in our history correspond with the best economic growth in our history.
Not to say one caused the other – quite the opposite – the two things simply have little or no impact on one another. You don’t need an overpaid economist to use common sense and look at real history.
But the neoliberals did a great job of selling this myth to a public all too willing to gobble it up. After all, their myth included lower taxes – who doesn’t want to pay lower taxes? Why on earth wouldn’t we want to believe that?
Why does this matter? Because lowering the tax rates caused the debt to explode. Cut your revenue stream, increase your spending, and the result is very predictable. Exploding debt. We were increasing defense spending like crazy, and cutting the revenue we have to pay for that increased spending.
Folks, fairy tale time is over. It’s time for us to finally grow up and take responsibility and accountability for how we’re running the country. It’s unfortunate that for the past 30 years, we’ve been electing folks who seem bound and determined to run us into bankruptcy, but let’s put that in the past. Let’s be big boys and girls, and refuse to listen to the partisan pranks and dribble that will continue from both parties.
Can anyone who really looks at the numbers think we don’t need to raise taxes? For the past 30 years, the tax breaks we keep giving ourselves have proven to be nothing but a way of running up credit card debt. We were fools. George Bush senior was right – it’s all been voodoo economics. We’re going to have to be careful how we do it, but if you think we can avoid it, you need to go on back and sit down in the fairy tale circle with the other little ones, and look forward to milk and cookies and a nap. And the tooth fairy will be here soon.
On the spending side, we need to attack the big dollar items in our budget. That means entitlements and defense. And let’s face it, our defense spending is beyond absurd. We spend almost as much on defense as the rest of the world combined. Think about that. Staggering and absurd. Why couldn’t we figure out a way to spend twice as much as the next country on the list – who happens to be China? If we did that, we could cut our military spending down to less than a third of what we spend today – almost down to a fourth!
Wow! Just make our military spending twice what the next biggest spender in the world spends, and we save 600 or 700 BILLION DOLLARS A YEAR! Cutting that kind of spending out of the economy will have lots of consequence, as it will no matter where you cut if.
For example, most folks would like to see entitlements cut. But let’s open up the concept of entitlements to include all government giveaways – not just the giveaways to poor folks or old folks. Let’s not leave out cut to poor folks or old folks – but lets make sure we’re cutting all across the board – poor folks and rich folks and everything in-between. I say that, and it makes me wonder why on earth I as a taxpayer would be handing out giveaways to rich and middle-class folks anyway. I guess I get why we’d be helping poor folks and old folks – agree or not with the concept these are folks who need help. But why are middle-class and rich folks on the dole?
Fodder for another post, but just keep in mind, as with military spending cuts, cutting here is going to reduce jobs that people have, and will reduce money that’s currently part of the spending cycle of our economy.
Bottom line – I’m hoping more people will turn off the absurd partisan talking heads that run our media this coming election cycle, and think for themselves. We spent 30 years digging a deep hole of debt. Both Democrats and Republicans had shovels in their hands. But We The People bear the ultimate responsibility for the fact that we sat around in the fairytale circle and let the neoliberals play pranks with our economy, and shuffle vast sums of our nations wealth into the pockets of the wealthy elite on the world stage.
As a Republican, I’m ashamed that my party has been the biggest supported of this neoliberal crap, but we’ve needed the help of Democrats to get it done.
Will we fall for that same old line of crap again? My hope and prayer is that real voters in both parties expel the neoliberals and neoconservatives, and let’s get back to real conservative, progressive, and liberal foundations.
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