Wanted: New Leadership in Washington, DC
Now we begin to really pile up the debt for our grandkids:
President Barack Obama’s budget will lead to deficits averaging nearly $1 trillion over the next decade, the CBO estimated Friday.
The Congressional Budget Office (CBO) said President Barack Obama’s budget would lead to annual deficits averaging nearly $1 trillion for the next decade.
The estimates are for larger deficits than the budget shortfalls expected by the White House.
Annual deficits under Obama’s budget plan would be about $976 billion from 2011 through 2020, according to a CBO analysis of Obama’s plan released Friday.
We need to freeze most of the federal budget and then begin gradually cutting spending. But do you get the sense that this is going to happen? No wonder there is the Tea Party protest movement. Something is really not right with the federal government.
It may feel good for some to blame this all on Obama. But the problem has been coming like a silent freight train for decades. Social Security and Medicare were structured wrong from the start. The pay-as-you-go structure of these programs is ill-suited for having a sudden wave of retirees like is coming as baby boomers begin retiring in mass.
Below is a chart I made in 2005 that shows where we have been headed. At this point I would say the red line is even steeper than that shown.
We need a Constitutional Amendment to limit the size of government as a percentage of GDP. And we need entirely new leadership in Washington, DC to tackle this spending problem.
For reference, below is a 2002 chart from the CBO that showed the projected size of just the federal government. You can see that we have known about this problem for a long time.
But, with real leadership, it is possible to reverse this trend. Just look at what New Zealand and Ireland did when they had good leadership.
March 6th, 2010 at 11:32 am
The problem is the republicans are still seriously considering people like Romney or Huckabee. Obamacare is just Romneycare upsized to the entire country. Huckabee is just another passionate conservative like Bush II. In otherwords, he loves spending other peoples money. Did anyone listen to him in the last campaign?
That is actually our true problem, we are addicted to OPM (Other Peoples Money).
If the republicans seemed serious about new leadership we would instead be talking about people like Ron Paul, Paul Ryan, David Walker, or Gary Johnson. They truly seem to get it about fiscal conservatism and have for some time, unlike the johnny come latelys like Romney, Huckabee, Palin, and Pawlenty. If the republicans seemed serious about financial conservatism they certainly wouldn’t have voted for McCain last time.
There is a serious credibility gap on the part of the current republican leadership. Unless there are major changes in this leadership then I don’t see them changing things much from the democrats.
Here are a few things we need to do to get back to fiscal sanity: flat tax with no deductions or credits, tax business profits once and only once preferably on the individual level, reduce regulations by doing a cost benefit analysis, set up our healthcare on a voucher type system that does not increase with inflation so that people will over time start taking more responsibility for themselves, replace the current social security with private accounts where the first portion, say $3,500 of your taxes ($7,000 married) increasing with inflation, goes into a retirement account, reduce substantially our military abroad and change from an offensive foreign policy to a defensive one (defend America, not being the police of the world), allow for more domestic energy without gov’t meddling and support, bring down trade barriers, pair down or even eliminate many drug laws so that we can lower the cost of our prison/judicial system, eliminate federal gov’t grants to states and businesses, eliminate most all of the federal education department, transfer almost all of the transportation department activities to the states, cut other spending substantially.
Who among the current republican leadership would be willing to do most of this? I don’t see any of them doing anything close to what needs to be done. Only outsiders such as Ron Paul, Gary Johnson, David Walker, and somewhat insider Paul Ryan seem like they may consider doing much of what needs to be done. We may have to look even further outside of Washington to other people who might actually understand what needs to be done.
March 8th, 2010 at 10:24 pm
TerryP,
“Who among the current republican leadership would be willing to do most of this?”
Yes, that is a problem. I just read about Gary Johnson. Cato gave him high marks in the 2003 article below: “For eight years the nation’s biggest skinflint governor was Gary Johnson of New Mexico, who vetoed over 1,000 spending items and cut taxes 14 times. Today, New Mexico is only one of 4 states without a budget deficit.”
http://www.cato.org/pub_display.php?pub_id=3005
And on David Johnson: “Walker has compared the present-day United States with the Roman Empire in its decline, saying the U.S. government is on a “burning platform” of unsustainable policies and practices with fiscal deficits, expensive overcommitments to government provided health care, swelling Medicare costs, the enormous expense of a prospective universal health care system, immigration, and overseas military commitments threatening a crisis if action is not taken soon.”
http://en.wikipedia.org/wiki/David_M._Walker_(U.S._Comptroller_General)
When do I get to place my vote for these guys?
March 11th, 2010 at 11:25 pm
One heck of a ticket would be Gary Johnson, President, Paul Ryan Vice President, and David Walker as your top economic guy. Possibily, though it would be nice to have Paul Ryan as the Speaker of the House instead of VP as that is where a lot of the policy making is done. Paul Ryan may even be the best one at the top of the ticket, but he has said he will not be running for President, but who knows that may change.