March 11, 2011

Budget, Deficits, Ideas, and Stuff

Posted in federal budget, role of government, taxes, U.S. Economy tagged , , , , , , at 12:48 pm by realitytax

The thing people are best at is exchanging stuff, including ideas; that’s what sets us apart from every animal on the face of the earth. Dogs don’t exchange bones with each other, chimpanzees and dolphins don’t ask for advice, and yet nobody reading this could build the simplest device we rely on every day in any reasonable amount of time without the active participation of many, many other people.

You doubt it? Name your example: Could you make a toothbrush? How will you get the petroleum to make the various plastics? OK, so you can whittle down a piece of wood to serve as the handle, sure, but are you going to use a knife you traded for or make your own? You can collect some stiff bristly stuff, but to trim it all to a nearly uniform length would you like a scissors? …and glue the bristles in place…how? Let’s not even consider transportation machines and mp3 players. So much more efficient to let somebody else mine and smelt the metals, while legions of people build and maintain the systems to distribute the stuff, and still others focus on food, wouldn’t you agree?

Another way to think of it is that while any of us can probably manage to be self-sufficient, it wouldn’t leave us much time for anything else at all. Complex trading makes it possible for specialists to efficiently do what they’re best at, and the whole society can enjoy the fruits of the labor of others.

Now what’s that got to do with the U.S. economy, government budget decisions, and the federal deficit?

Well, while we can all agree that while the government has a long-term fiscal management issue, (call it a problem if you like,) the key factor in the budget challenges is health care costs, and more to the point the rate at which those costs are growing. According to a recent article in the New York Times, “The Congressional Budget Office expects Social Security outlays as a percentage of G.D.P. to rise 30 percent over the next quarter-century, as the population ages, but it expects a near doubling of the share of G.D.P. spent on Medicare and Medicaid.

We don’t solve that by reducing what we spend on either education or job creation. Cutting the benefits for military veterans only shifts the costs of their health care, it doesn’t control it. Cutting taxes surely doesn’t provide any free-market incentive to rein in runaway health care costs, nor does reducing and/or eliminating the collective bargaining rights of public-sector employees (another way of shifting the costs without actually addressing the cause.)

There’s a time for catching the drips coming through the roof, but that’s a stop-gap until you can properly fix the roof. If you’re in charge of the building it’s not responsible to tell the people who live or work in it to just keep emptying their buckets – if you don’t know what to do yourself, you call somebody who can fix it, and if you have to raise the rent you do that, too. That’s the whole point of participating in society instead of being self-sufficient.

Bernie SandersIt’s time for Congress to do their job and stop asking the American people to keep emptying the buckets. They asked voters to trust them to solve problems – to keep the roof in good repair – not kick them down the road while we collect rainwater and listen to their complaints about how hard it is to fix. Lowering taxes to fight a budget deficit is like bringing gasoline to fight a fire.

Those elected officials that have no idea how to actually live up to that promise should get out of the business and let somebody with real solutions work on it before they ruin the building and bring down the value of the whole neighborhood even further. Stop talking about “partnering with business” and how regulations are a burden and go work on whatever stuff it is you’re actually good at doing (other than interviews with sound-bites and acting like absentee slumlords, that is,) and leave my government – for the people – alone.

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July 2, 2010

Leadership and the budget conundrum

Posted in 2010 Elections, health care, media coverage, taxes, U.S. Economy tagged , , , , , , , , , , , at 7:55 am by realitytax

Budgeting is always an exercise in prioritization; there’s never enough money to accomplish everything we’d choose to undertake perfectly. The vast majority agree we want government to exist, to manage highways and immigration and mutual defense and make sure our toys don’t have lead paint and our drugs aren’t snake oil and prevent monopolies and so on.

Accordingly, it’s the leaders we elect who have to run government well, although many lately seem to run on the premise that government can’t do anything cost-effectively, let alone well.

We’ve seen what happens when big business calls the shots, from Wall Street’s calamitous collapse (which hurt most of us considerably more than it did them) to the slip-shod operation of an oil rig that threatens to ruin the livelihoods of millions along the gulf coast and savage the oceans and shores for decades to come. The short-sighted profit motive aspect of capitalism is best balanced by governmental regulation on behalf of the greater good.

True leaders don’t sit back and watch as our jobs move overseas and huge corporations prey greedily on those outside their inner circles, they work on behalf of those who elected them despite the constant temptation posed by special influence money. I’m delighted there are, in fact, so many excellent elected officials working on behalf of Minnesotans, and I congratulate David Bly, U.S. Represenative Tim Walz, and their hard-working current and former peers such as Shelley Madore, John Marty, and the late, great U.S. Senator late Senator Paul WellstonePaul Wellstone pursuing solutions to everything from the MN Health Plan to our national budget priorities. Their tireless, selfless efforts are a model of how to step up and get work done despite naysayers who promote a “divided we fall” agenda exemplified by the smoke-and-mirrors approach to discussing the Minnesota budget that Governor Tim Pawlenty has relied on to further his Presidential ambitions at the expense of the citizens of Minnesota.

Hopefully this current election cycle will give us more people pursuing common sense approaches in the state and national legislatures instead of more political posturing and empty “anti-tax, anti-government” sound-bites, although from Fox to MSNBC the media lately seems inclined to let the latter dominate their “journalism” rather than observing that time-tested rule for investigative research and reporting: follow the money.

September 29, 2009

How the U.S. government spends your money

Posted in government pork spending, Obama administration, taxes tagged , , , , , , , , , , , at 5:21 pm by realitytax

Billions of tax dollars are going for a US-Mexico border fence, but is it doing any good?  Well, if you read the Christian Science Monitor article by Daniel Wood you’ll have more questions than answers.

In 2006 DHS awarded a “virtual fence” contract to Boeing for a stretch of the border in Arizona as part of President Bush’s “Secure Border Initiative.” The budget grew to nearly $1 billion just two years later. So far, no virtual fence; just a very real budget. DHS recently decided to extend its contract with Boeing for another year.

Several sites now report that the Government Accountability Office (GAO) recently predicted that $6.5 billion will be needed to maintain the rest of the actual, though still incomplete, multi-billion dollar non-virtual fence over the next 20 years, addding:

“So far, it has been breached 3,363 times, requiring $1,300 for the average repair.”

Just so you don’t have to reach for your calculator, the math works out like this:

3,363 breaches x $1300 = $ 4,371,9000

But the kicker is there’s no way to prove if it’s actually making any real difference – well, beyond fattening the wallets of the folks awarded the contracts and costing tax-payers money, of course. So, we’ve spent about $2.5 billion so far on construction, we’re seeing several new breaches each day (on average), and CSM interviewed one woman, Dawn Garner, who says that 40 illegal immigrants a day cross her small ranch.

Sound bad? Don’t answer yet.

Ronald Reagan famously urged Gorbachev to tear down the Berlin Wall. There was a lesson there we’ve somehow forgotten about what the effects and effectiveness of walls really are.

Yasha Levine, writing at The Exiled, reports he’s interviewed a Border Patrol agent who asserts that it’s not just breaches – in some cases ramps are deployed on both sides and smuggler’s caravans drive right over!  Levine has more bad news:

There is one thing we can be sure of:

the massive steel pylons have been a boon for Mexican scrap metal entrepreneurs, who are able to supplement their incomes by dragging off whole sections of the fence right under the nose of our beefed up Border Patrol.

And those we capture trying to make the crossing? We spend a bit of money to detain them, a bit to process them, a bit to send them back home again, and – you guessed it – start the cycle over. Because if there’s one other thing we can be sure of:

No matter which country they’re a citizen of, the folks who prefer the USA to Mexico aren’t likely to change their minds.

But DHS, born under former GOP President George Bush, sees no reason to change course, or deny money to Boeing or the other contractors.  They’ve got a mandate for, “more effective use of personnel and technology” and “physical infrastructure enhancements to prevent unlawful border entry,” and so spend they will. But are we stopping the drugs and other smuggling? Honestly, nobody knows.

It’s past time to think about our priorities, particularly our spending/funding priorities and the role of the federal government.  It grew larger than ever over the early part of the 21st Century, but failed to address the needs of our nation.

Instead politicians awarded lucrative contracts as political favors. It’s no wonder the trust for Congress has plummeted – the scrutiny has them scurrying for cover, and some of them are talking out of both sides of their mouths.