Duped again. The scales
over the eyes of the American public are once again being lifted. Although no
secret, the dynamics of baselline budgeting are in the limelight. As such, the
dark secrets of the process are illuminated for all to see.
Our national and in some
cases state practice of baseline budgeting is simple. We calculate expenses
versus income including gains or losses over a given fiscal year and use that
as a baseline. Then we legislate calculations that provide annual percentage
increases in recurrent spending such as welfare, medicare, aid to education
etc. These percentage increases are annually re-calculated for future years and
are then fixed into the budget in advance of any given fiscal year.
Then we debate next
year's actual budget without reference to percentage increases previously
legislated. The result is a de facto increase in spending in spite of any newly
agreed and legislated budget cuts. Take for example, education which may have a
previously legislated percentage increase for next year of 6%, or (for purposes
of illustration) 20 billion dollars. Next, we impose spending cuts for next
year of say 10 billion and crow about our parsimony to anyone who cares to
listen. But in fact, spending has increased owing to the baseline principle.
The only people in
Washington that I believe to be serious about actually reducing spending and
balancing the national budget and reducing the size of government are the Tea
Party folks. Personality wise, they are not my favorite people. The enter the
scene with a strong dose of holier than thou, hard core religion, extreme
patriotism and an unshakable belief that by feeding the rich, the poor will
benefit. Perhaps, but then again perhaps not.
Given the Tea Party's
dedication to free market principles, the rich will become richer but not
necessarily the poor, or middle class. This is because of the greed factors
that have taken possession of American enterprise over the past several
decades. Public welfare has been eclipsed by the obsessive accumulation of
wealth. Sure, the rich give to charity, but in the form of enormous tax
write-offs.
The case for the super
poor is no better. According to our Treasury Secretary, Tim Geithner, 40% of
the children born today will be eligible to receive food stamps. Poverty is
feeding on itself in the USA and is understandably getting less healthy as a
result.
Concepts are direly
needed to dramatically relieve poverty and dramatically revive the economic
strength of the middle class. To be sure, give away and welfare programs are
not the solution. They only create dependencies which in turn expands the
poverty base.
Nobody in power today
wants to address these issues in a practical manner. All we get is a bunch of
blah, blah, blah without any concrete evidence of serious concern on
politicians parts, or workable solutions.
In the meantime, we are
behaving like spoiled brats arguing amongst ourselves in full view of the world
at large. We should be ashamed of ourselves. My take is that we will continue
to wash our dirty laundry with even more exposure and revelations before,
during and well after the issue of America's debt ceiling is decided. It would
appear that America's capacity to tackle and resolve hard issues has turned
sour. Pity that.
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