Why is it so hard to balance the Federal Budget? Millions of American do it every day with their own personal and business finances, why can't our elected leaders do it with the country's money?
Oh yeah, I forgot, it's not their money, it's ours! It's easy to spend money you have no appreciation for earning.
The federal government is spending about $500 billion a year more than it takes in. If nothing is done, that gap grows to around $700 billion a year by 2014 and continues to widen even faster when baby boomers begin to retire.
Balancing the budget, while politically difficult, must be a priority or we're going to put our economy into the ditch. The uncontrolled spending of the last two years is totally unjustified and politicians just can't be trusted to get it under control on their own.
Many economists have produced models for balancing the budget. We could do it painfully in less than three years, or less painfully by spreading it out over ten years. Regardless of time, it must be done. Once the budget is balanced, we must at that point, MANDATE a balanced budget annually, in the form of a Constitutional Amendment that requires Congress to keep it balanced. An exception can be made in emergencies such as war or major national disasters by temporarily suspending the amendment (no more than 5 years) if two-thirds of both Houses of Congress and the President approves.
So how do we get to a balanced budget?
Three things must be done to balance the budget.
#1 Stop the wasteful Spending.
The first rule for getting out of a hole is to stop digging. Every American knows this; it's basic common sense. Yet those in Washington seem to have a hard time grasping it. Immediately freeze all spending at current levels, indexed for inflation. No cuts - No increases. Inflation grew by 2.2% last year yet Congress increased overall spending by over 4.5%, over double the rate of inflation.
Pork Barrel Spending was even worse in 2005. Congressmen stuffed 13,997 projects worth $27.3 billion into 13 appropriations bills, an increase of 31% over 2004's total of 10,656 wasteful spending projects.
If we just held overall spending to 2.2% this year we could have saved $141 billion without cutting a single program; reducing the deficit to $360 billion instead of the current $500 billion.
#2 Reduce the size of the Federal Government.
All good Republicans tout the Reagan Era mantra of "smaller, more efficient Federal Government." Strangely, the Federal Government has increased in size the past two years. Again, I thought we were Republicans? Several well known economic think tanks say we could cut the size of government by a mere 1.9%, generating almost $150 billion in instant savings and most Americans wouldn't even notice it. That's almost 1/3 of the deficit right there. Imagine if we cut the size of government by 3% or 4%.
Add that to the previous savings and we'd have the deficit down to $110 billion.
#3 Reduce the cost of Energy.
This is the life blood of our economy. Cheap energy stimulates the economy; when the economy booms, revenue coming into the treasury increases substantially. We saw this first hand in the mid 1990's when we were running a surplus. An economy running above 3% annual growth could cut the deficit by a few hundred billion dollars, erasing the deficit and running a surplus that would start to pay off the national debt. I discuss reducing the cost of energy in the "National Energy Policy" section.
If elected, I will immediately submit legislation to enact these three principles to eliminate the deficit and start paying off our debt. [top]
Paying off the debt:
The National Debt currently stands at $8,100,000,000,000.00 ($8.1 Trillion). To put it into a better perspective, right now every man woman and child in the United States owes about $25,000 that they didn't get to spend. Your elected officials spent it on your behalf. If you're a family of four, you owe $100,000. Your neighborhood most likely owes millions, and your city billions in unpaid loans.
Even if you don't feel personally responsible for your share of the debt, you still feel its impact by having to scale back funding for social services, education, defense, etc.
Currently we are paying $351 billion a year just on interest. Imagine what we could invest that money in if didn't have to use it to pay the interest on the debt.
Federal Reserve Chairman Alan Greenspan was quoted as saying, "Reducing the federal debt to the public at this stage is unquestionably the most important thing that I believe we can do if meeting the future needs of the economy is the standard."
Once the budget is balanced, efforts can be made to finally pay off the National Debt.
The saving in interest alone could dramatically offset projected shortfalls in Social Security, easily absorbing the looming mass retirement of the "Baby Boomer" Generation, preserving the integrity of Social Security for generations.
We owe it to our kids and our grandkids, and actually our parents and grandparents drawing Social Security to get this under control. Dumping debt into the laps of your children was once looked upon with disdain, and for good reason.
I will team with fellow fiscally conservative Republicans and yes, even Democrats, to make this happen, even if it runs headstrong into the wishes of the Party Leadership. You need a Congressman with the guts to take on the big spenders, especially the ones in his own party. Do you think any other candidate can or will do the same?