A few weeks ago I spent a good part of my day watching the Pay-go debates. I was blown away by the rhetoric from both sides, though I was impressed with Rep. Paul Ryan, who seems serious about solving our economic problems.
As the Democrats talked extensively on the financial irresponsibility of the Republican Party, they talked about how all of this was just a gimmick. It increased spending and acceptable debt dramatically each year. It also has a record of not working, since the House adopted this rule the day Pelosi was made Speaker of the House. Anyone have an idea of how much debt we've accumulated since that day? Just wondering...
Anyways, it turns out that Sen. Bunning wants to hold them accountable to this law, and that he believes it's a good time because the extension of unemployment is something that both sides agree on. What they can't seem to agree on, is where the money should come from. Should it come out of thin air? Or should we stick with the law that President Obama signed just weeks ago. Sen. Bunning has proposed we use part of the unspent stimulus money. And yet the Democrats still stick to sensationalism. We need this money, this is for the people, it's not time to play political games.
I wish that people would take the time to watch the debates on C-Span, to see their Representatives and Senators spew so much rhetoric during the debates, just to show what they really believe in a few weeks later. It doesn't take long, especially when it comes to spending. The idea of controlling spending in Washington today is quite similar to asking a heroin addict to control his usage.
We've got a problem, and we need to fix it. That's right Washington, it's not time for political games.
Tuesday, March 2, 2010
Tuesday, February 23, 2010
Government Funding vs. Economic Growth
We need a real bi-partisan solution to our economic problems. Currently most people view either the government or the private economy as the source of our problems, and the other as the answer. It's a relationship that encourages failure. As long as we allow this relationship to exist we won't see any type of economic stability, and we will never get a grasp on economic growth.
What is unarguable is that all government spending requires that we pull money from the private sector to fund it. Most people also agree that some, or many, of these government programs have practical purposes, and even if you don't agree with how they are ran or you believe they produce an undesired outcome, you wouldn't choose to get rid of them over modification. So, while the government programs are important, we need to figure out at what point does the government tax burden become so intrusive that economic growth is no longer likely. We then need to decide what amount of economic growth is desirable for the time, and what we can afford to spend on government programs.
Once we decide on the desired percentage of tax burden we then determine how much funding that will produce for the following year. From there all of our budgetary plans are determined. So instead of determining funding by the number of bright ideas Washington can come up with, we determine it by affordability to our country. The year's budget would be formed from that particular dollar amount and to add funding to one program would mean that you took it from another. This should also pose a practical compromise to the Democrat's Pay-Go bill, which works like that in theory but is determined by a budget that is not considerate to the private economy.
All of this can be done through a bi-partisan effort. If we didn't look at the other as our enemy, and instead learned how each side plays a valuable role in our country's prosperity, we could essentially control the economic growth of our country while still providing ideal services to it's citizens. Unfortunately, it takes an effort far more serious than Washington is currently willing to provide.
What is unarguable is that all government spending requires that we pull money from the private sector to fund it. Most people also agree that some, or many, of these government programs have practical purposes, and even if you don't agree with how they are ran or you believe they produce an undesired outcome, you wouldn't choose to get rid of them over modification. So, while the government programs are important, we need to figure out at what point does the government tax burden become so intrusive that economic growth is no longer likely. We then need to decide what amount of economic growth is desirable for the time, and what we can afford to spend on government programs.
Once we decide on the desired percentage of tax burden we then determine how much funding that will produce for the following year. From there all of our budgetary plans are determined. So instead of determining funding by the number of bright ideas Washington can come up with, we determine it by affordability to our country. The year's budget would be formed from that particular dollar amount and to add funding to one program would mean that you took it from another. This should also pose a practical compromise to the Democrat's Pay-Go bill, which works like that in theory but is determined by a budget that is not considerate to the private economy.
All of this can be done through a bi-partisan effort. If we didn't look at the other as our enemy, and instead learned how each side plays a valuable role in our country's prosperity, we could essentially control the economic growth of our country while still providing ideal services to it's citizens. Unfortunately, it takes an effort far more serious than Washington is currently willing to provide.
Thursday, February 18, 2010
Regardless, a re-vamp is in order
So one thing that has really inspired me is a mood that is absorbing America right now. Regardless of your political affiliations, you would agree that major changes need to be made. That the course we are headed on right now is a very destructive one. No matter what you believe the role of government should be, you know that this one isn't quite right.
I was reading an article in The Atlantic yesterday. It's a left leaning article, and actually provides a lot of intelligent perspective from that side of the political spectrum. He also points out the resilient nature of the American people, which I highly agree with. We will pull out of this, and with any luck, it will be a defining moment for our generation. The only question left now is how we will do it.
I was reading a Thomas Sowell column the other day and he pointed out one of the most important facts about our current state of Washington. Most of what we see is a distraction. A lot of the ideas we are convinced to care about are put in place to control. Washington isn't set up right now to help America, it's set up to help Washington. To control how you vote and who gets re-elected. If you want to see what I mean look at the current state of roads in this country. Look at it as a whole and then compare it to West Virginia. Robert Byrd served on the appropriations committee fors 50 years! His state was highly rewarded for his service, and a good portion of our country's roads have suffered as a result. It's actually been set up in a way that if you don't support these people on the appropriations committee you would suffer a lack of funding. Not just the Democrats, everyone. They set up funding to control the politicians, and it destroys productivity in Washington.
Another example is the New Orleans post-Katrina. Regardless of how you view the federal funding to assist in the recovery of New Orleans, you have to recognize that massive amounts of dollars have gone into the project. According to this article, published last August, at least $50 billion dollars have been given to the city for the purpose of rebuilding it. So after 4 years, and massive amounts of tax dollars very little has actually been done to bring New Orleans out of it's slump. This is because the emergency has created an incredible way to make the friends of politicians very rich. If you fix it, the money goes away. If you solve the problem you lose political control.
If you were to follow the spending of our government you would see example after example of this. Washington simply isn't set up to solve problems. They are set up to control massive amounts of the US dollar, and to put one side against the other to maintain power. I think it's clear from the last time the Republican Party held a majority that both parties prefer big government. Oddly enough, I think I've at least come up with a solution to begin a constructive debate to change this all around.
Realistically, most people don't hold the Libertarian perspective that we need an extremely minimal government. Some things are best left in the hands of the government, and if ran correctly would actually be far more productive than in the private sector. To accomplish that though we need a series of checks and balances. We need programs to monitor every dollar coming in and out of Washington, and we need to work vigilantly to rid the massive waste our federal government now produces. This should be made up of bi-partisan committee's in each department of government that provide full disclosure to watch-dog groups to keep them honest.
We need serious debate to decide where these programs can most efficiently be controlled and funded. If the states, or more localized government, would be better equipped to handle certain programs they should be handed over to them. If in certain instances the federal government would be best for funding, and the local government would be best for control it should be set up in a way to keep Washington honest.
We need to limit the federal government's funding to a certain percentage of the GDP. At some point the burden places a lot of hardship on our country. In some ways the Obama administration is right. We need to spend our way out of this crisis, but the way they propose it is wrong. We can no longer do it through the acquisition of debt. We need to suck it up and do what many American's have already done. Pay off our debt, save, and plan our spending. This needs to be done at all levels of our country. The best way to do it is to cut taxes in conjunction with a reduced spending in Washington. If we were to look at each program seriously and focused it toward productivity rather than the protection of Washington I think the programs would be far more helpful than they currently are. Basically, we would get far more with less. Our citizens could pay off their debt and get out of the slump they are in. They could then save up some money for security and then once again resume spending. Entrepreneurs would spring up from the opportunity and run far more responsible businesses resulting in massive job creation in a far more secure market then we shared before.
We would need a bi-partisan effort that worked to reduce distractions and instead focus on our country. Personally I think this would be a lot more promising with term limits. We need idealist that would go in and serve rather than plot out a political career and their own personal enhancement of power. We need people who are willing to take an actual interest in the programs they propose and find ways to produce the desired outcome. Simply throwing money at a problem should no longer be acceptable. We need to be more forward thinking.
This would sound a little Utopian like in nature. In most cases it would never be possible, but this time could be different. With the current mood in America we really could create real change and instead of creating a burden for the next few generations we could actually create a dream. A country that looked into it's future rather than the current second that is only possible through the acquisition of debt. We need to decide as a whole, that regardless of political affiliation we demand a change in the current state of Washington. That we want to see them do what they promise instead of acquiring more of our wealth and leaving us with more of their debt.
Is it possible that just for a moment we could ignore the distractions that pit us against each other and form ideas for real change? Can we value the perspective of others through debate and take a genuine interest in the future of our country?
I was reading an article in The Atlantic yesterday. It's a left leaning article, and actually provides a lot of intelligent perspective from that side of the political spectrum. He also points out the resilient nature of the American people, which I highly agree with. We will pull out of this, and with any luck, it will be a defining moment for our generation. The only question left now is how we will do it.
I was reading a Thomas Sowell column the other day and he pointed out one of the most important facts about our current state of Washington. Most of what we see is a distraction. A lot of the ideas we are convinced to care about are put in place to control. Washington isn't set up right now to help America, it's set up to help Washington. To control how you vote and who gets re-elected. If you want to see what I mean look at the current state of roads in this country. Look at it as a whole and then compare it to West Virginia. Robert Byrd served on the appropriations committee fors 50 years! His state was highly rewarded for his service, and a good portion of our country's roads have suffered as a result. It's actually been set up in a way that if you don't support these people on the appropriations committee you would suffer a lack of funding. Not just the Democrats, everyone. They set up funding to control the politicians, and it destroys productivity in Washington.
Another example is the New Orleans post-Katrina. Regardless of how you view the federal funding to assist in the recovery of New Orleans, you have to recognize that massive amounts of dollars have gone into the project. According to this article, published last August, at least $50 billion dollars have been given to the city for the purpose of rebuilding it. So after 4 years, and massive amounts of tax dollars very little has actually been done to bring New Orleans out of it's slump. This is because the emergency has created an incredible way to make the friends of politicians very rich. If you fix it, the money goes away. If you solve the problem you lose political control.
If you were to follow the spending of our government you would see example after example of this. Washington simply isn't set up to solve problems. They are set up to control massive amounts of the US dollar, and to put one side against the other to maintain power. I think it's clear from the last time the Republican Party held a majority that both parties prefer big government. Oddly enough, I think I've at least come up with a solution to begin a constructive debate to change this all around.
Realistically, most people don't hold the Libertarian perspective that we need an extremely minimal government. Some things are best left in the hands of the government, and if ran correctly would actually be far more productive than in the private sector. To accomplish that though we need a series of checks and balances. We need programs to monitor every dollar coming in and out of Washington, and we need to work vigilantly to rid the massive waste our federal government now produces. This should be made up of bi-partisan committee's in each department of government that provide full disclosure to watch-dog groups to keep them honest.
We need serious debate to decide where these programs can most efficiently be controlled and funded. If the states, or more localized government, would be better equipped to handle certain programs they should be handed over to them. If in certain instances the federal government would be best for funding, and the local government would be best for control it should be set up in a way to keep Washington honest.
We need to limit the federal government's funding to a certain percentage of the GDP. At some point the burden places a lot of hardship on our country. In some ways the Obama administration is right. We need to spend our way out of this crisis, but the way they propose it is wrong. We can no longer do it through the acquisition of debt. We need to suck it up and do what many American's have already done. Pay off our debt, save, and plan our spending. This needs to be done at all levels of our country. The best way to do it is to cut taxes in conjunction with a reduced spending in Washington. If we were to look at each program seriously and focused it toward productivity rather than the protection of Washington I think the programs would be far more helpful than they currently are. Basically, we would get far more with less. Our citizens could pay off their debt and get out of the slump they are in. They could then save up some money for security and then once again resume spending. Entrepreneurs would spring up from the opportunity and run far more responsible businesses resulting in massive job creation in a far more secure market then we shared before.
We would need a bi-partisan effort that worked to reduce distractions and instead focus on our country. Personally I think this would be a lot more promising with term limits. We need idealist that would go in and serve rather than plot out a political career and their own personal enhancement of power. We need people who are willing to take an actual interest in the programs they propose and find ways to produce the desired outcome. Simply throwing money at a problem should no longer be acceptable. We need to be more forward thinking.
This would sound a little Utopian like in nature. In most cases it would never be possible, but this time could be different. With the current mood in America we really could create real change and instead of creating a burden for the next few generations we could actually create a dream. A country that looked into it's future rather than the current second that is only possible through the acquisition of debt. We need to decide as a whole, that regardless of political affiliation we demand a change in the current state of Washington. That we want to see them do what they promise instead of acquiring more of our wealth and leaving us with more of their debt.
Is it possible that just for a moment we could ignore the distractions that pit us against each other and form ideas for real change? Can we value the perspective of others through debate and take a genuine interest in the future of our country?
Tuesday, February 16, 2010
It may take the people this time...
Are people realizing yet that the party you swear on may not have the answers? I know the reason I started looking into the Libertarian Party had everything to do with the big government disappointments I had with the Republican Party. In the last few years I haven't been happy voting Republican, I did it because they would take us to the cliff slower. You should know though, we are headed toward a cliff. You can pick your piper, but it will take a lot of drastic change and focus from the populous to actually affect a change that would alter our course.
I'm also not saying the Libertarian Party has the answers. I don't really believe that. Their growing popularity comes at an overwhelming desire from the populous to reduce the burden our government is continually placing on them.
The real change is going to come from the grass root groups. The Tea Party movement is incredible, and if you are already of the opinion that they could never hold a successful gathering on the same day as the Daytona 500 you are following the wrong piper. Actually, if you share the opinion that the Tea Party is made up of a bunch of racist, white trash, rednecks then that is all the more reason for you to get involved, and I'm about to tell you why.
The Tea Party represents a movement by the people. The Liberal media would have you believe that a respectable person would never get involved in this movement, and chances are this has everything to do with control. Right now you are told what to think. These grass roots groups are ran in YOUR local communities, by YOUR local communities. They represent the tone in YOUR town. They result in a raised awareness of who YOU are voting for, and what their motive is for wanting to represent YOU. The Tea Party itself has no official party, or platform. It's fueled in similar ways to the Bostonians who grew tired of the burden England was putting on them. There are Democrats and Republicans alike who believe that major changes need to be made to our government for our country to be successful.
The chances of you knowing who is in Washington to help you, and who is there to be a career politician are not likely if you just skim through your local paper, or turn the volume up when you see your Senator speaking on TV. Most people don't spend the time watching debates on C-Span, or following bills to really be informed, but these grass roots groups are made up of people who do. They can pick out local talent to replace worn out bureaucrats, and really, that is how the real change will be made.
So get involved, if you don't like the Tea Party find something else, but apathy is no longer acceptable. The country is eroding at record rates and voting on a party line is not going to stop it.
I'm also not saying the Libertarian Party has the answers. I don't really believe that. Their growing popularity comes at an overwhelming desire from the populous to reduce the burden our government is continually placing on them.
The real change is going to come from the grass root groups. The Tea Party movement is incredible, and if you are already of the opinion that they could never hold a successful gathering on the same day as the Daytona 500 you are following the wrong piper. Actually, if you share the opinion that the Tea Party is made up of a bunch of racist, white trash, rednecks then that is all the more reason for you to get involved, and I'm about to tell you why.
The Tea Party represents a movement by the people. The Liberal media would have you believe that a respectable person would never get involved in this movement, and chances are this has everything to do with control. Right now you are told what to think. These grass roots groups are ran in YOUR local communities, by YOUR local communities. They represent the tone in YOUR town. They result in a raised awareness of who YOU are voting for, and what their motive is for wanting to represent YOU. The Tea Party itself has no official party, or platform. It's fueled in similar ways to the Bostonians who grew tired of the burden England was putting on them. There are Democrats and Republicans alike who believe that major changes need to be made to our government for our country to be successful.
The chances of you knowing who is in Washington to help you, and who is there to be a career politician are not likely if you just skim through your local paper, or turn the volume up when you see your Senator speaking on TV. Most people don't spend the time watching debates on C-Span, or following bills to really be informed, but these grass roots groups are made up of people who do. They can pick out local talent to replace worn out bureaucrats, and really, that is how the real change will be made.
So get involved, if you don't like the Tea Party find something else, but apathy is no longer acceptable. The country is eroding at record rates and voting on a party line is not going to stop it.
Friday, February 5, 2010
Pay-go + $1.9 trillion increase to debt ceiling?!
So it seemed like business as usual in Washington yesterday. The House Democrats voted to pass a bill that would not only institute a pay as you go law, but also approves an increase in the debt ceiling so great that it actually exceeds last years GDP. According to this Bill the acceptable debt for 2011 is $14.35 trillion and actually increases to $17.1 trillion in 2014. This under the name of fiscal responsibility.
I watched the debates absolutely fascinated by the rhetoric from both sides. All you see in Washington today is finger pointing at the opposing party. So while they should be trying to bring the country out of it's economic slump, they choose instead to campaign for their party's success in November. Nearly every speaker called for a bi-partisan effort while refusing the ideas of the other party. I don't believe any Democrat mentioned the increase of the debt ceiling, while the Republicans treated pay as you go in a similar manner. I can see it in the campaigns now, everyone who voted can claim that they fought for fiscal responsibility. While at the same time everyone who campaigns against them can accuse them of voting against it. It was a ridiculous Bill, and seems to be completely superficial.
Rep. Paul Ryan (WI) may have been the only person who had any substance in the debate. He actually seemed to care about the direction of the country. Shortly after Nancy Pelosi spoke about how proud she was that the House Democrats voted Pay-Go, as a rule, on her second day as speaker, he pointed out it's failure. It turns out, the same people who brought you Pay-Go also brought TARP, and every other big government program since. He points out four major flaws here:
He calls for serious people from both parties to come up with serious solutions. I like this, because there is a lot to be gained from both sides. The Pay-go deal could be useful with a few more restrictions. Maybe a budget where you don't increase the limit each year. Why don't we use a pay-go with an annual decrease until we reach a certain percentage of the GDP. Instead of 27%, why not 15%? Why don't we create a program that monitors all government programs and forces them to justify their need and holding them accountable to wasteful spending? It seems to me that Washington was restricted in size they would be forced to be a lot more efficient. Maybe if the taxpayer wasn't held accountable to every bright idea that came out of Washington our economy would once again become manageable.
I'd be lying to say that I'm not looking forward to next November, but a Congress worried more about campaigning than solutions doesn't give me much hope for either party's success.
I watched the debates absolutely fascinated by the rhetoric from both sides. All you see in Washington today is finger pointing at the opposing party. So while they should be trying to bring the country out of it's economic slump, they choose instead to campaign for their party's success in November. Nearly every speaker called for a bi-partisan effort while refusing the ideas of the other party. I don't believe any Democrat mentioned the increase of the debt ceiling, while the Republicans treated pay as you go in a similar manner. I can see it in the campaigns now, everyone who voted can claim that they fought for fiscal responsibility. While at the same time everyone who campaigns against them can accuse them of voting against it. It was a ridiculous Bill, and seems to be completely superficial.
Rep. Paul Ryan (WI) may have been the only person who had any substance in the debate. He actually seemed to care about the direction of the country. Shortly after Nancy Pelosi spoke about how proud she was that the House Democrats voted Pay-Go, as a rule, on her second day as speaker, he pointed out it's failure. It turns out, the same people who brought you Pay-Go also brought TARP, and every other big government program since. He points out four major flaws here:
- The $787-billion “stimulus” bill (now estimated by CBO to be $862 billion) was designated as an “emergency,” so pay-go did not apply to it.
- According to CBO, H.R. 3961, adjusting the sustained growth formula [SGR] for dodged pay-go in this case by burying this cost in the budget baseline. Thus, relative to the pay-go baseline, this $200 billion in real spending and deficit increases disappeared.
- The State Children’s Health Insurance Program expansion (H.R. 2) provided an increase of $74 billion over 10 years. So Congress wrote into the bill a spending “cliff” – a provision that cut SCHIP spending by 65 percent in 2014, meeting pay-go’s requirement with a reduction that will never occur.
- In 2008, the war supplemental (H.R. 2542) included $66 billion in mandatory spending that otherwise would have been subject to pay-go.
He calls for serious people from both parties to come up with serious solutions. I like this, because there is a lot to be gained from both sides. The Pay-go deal could be useful with a few more restrictions. Maybe a budget where you don't increase the limit each year. Why don't we use a pay-go with an annual decrease until we reach a certain percentage of the GDP. Instead of 27%, why not 15%? Why don't we create a program that monitors all government programs and forces them to justify their need and holding them accountable to wasteful spending? It seems to me that Washington was restricted in size they would be forced to be a lot more efficient. Maybe if the taxpayer wasn't held accountable to every bright idea that came out of Washington our economy would once again become manageable.
I'd be lying to say that I'm not looking forward to next November, but a Congress worried more about campaigning than solutions doesn't give me much hope for either party's success.
Wednesday, February 3, 2010
$3,800,000,000,000
In the same speech President Obama proposed a budget of 3.8 trillion dollars he has the audacity to say this,
"But we can't simply move beyond this crisis; we have to address the irresponsibility that led to it. And that includes the failure to rein in spending, as well a reliance on borrowing –- from Wall Street to Washington to Main Street –- to fuel our growth. That's what we have to change. We have to do what families across America are doing: Save where we can so that we can afford what we need."
He's right too, that is exactly what the problem is, but while two of the three are doing their part, he's now proposing even more spending by the government. In 2009 our country's GDP was 14.25 trillion dollars. So President Obama, who recognizes that part of the problem is excessive spending in Washington, is now proposing a budget that makes up %27 of last year's GDP. Are people really falling for this? Does it not sound at all like what he said at the end of his speech?
"is the same old grandstanding when the cameras are on, and the same irresponsible budget policies when the cameras are off."
What cracks me up is that no one seems to be calling him out on this. I hear a lot of comments about how he continues to bash Bush though. It's true, President Bush, and Congress that in those 8 years was dominated by both parties, are to blame for this crisis. Anyone in Washington trying to claim innocence should be seriously questioned. That Republican Party wasn't fiscally responsible, or a proponent of small government. So why don't we accept this and move on? Why don't we choose to call him out for saying one thing and doing another? I mean really, I've heard of politicians changing policy ideas when standing in front of different crowds, but I have never heard of this being done in the exact same speech. Someone should seriously tell this guy that you can't brag about budget cuts while at the same time proposing an even larger budget. It doesn't make sense.
Really, is it too much to ask to listen long enough to see what's really going on, instead of getting distracted by petty party politics?
"But we can't simply move beyond this crisis; we have to address the irresponsibility that led to it. And that includes the failure to rein in spending, as well a reliance on borrowing –- from Wall Street to Washington to Main Street –- to fuel our growth. That's what we have to change. We have to do what families across America are doing: Save where we can so that we can afford what we need."
He's right too, that is exactly what the problem is, but while two of the three are doing their part, he's now proposing even more spending by the government. In 2009 our country's GDP was 14.25 trillion dollars. So President Obama, who recognizes that part of the problem is excessive spending in Washington, is now proposing a budget that makes up %27 of last year's GDP. Are people really falling for this? Does it not sound at all like what he said at the end of his speech?
"is the same old grandstanding when the cameras are on, and the same irresponsible budget policies when the cameras are off."
What cracks me up is that no one seems to be calling him out on this. I hear a lot of comments about how he continues to bash Bush though. It's true, President Bush, and Congress that in those 8 years was dominated by both parties, are to blame for this crisis. Anyone in Washington trying to claim innocence should be seriously questioned. That Republican Party wasn't fiscally responsible, or a proponent of small government. So why don't we accept this and move on? Why don't we choose to call him out for saying one thing and doing another? I mean really, I've heard of politicians changing policy ideas when standing in front of different crowds, but I have never heard of this being done in the exact same speech. Someone should seriously tell this guy that you can't brag about budget cuts while at the same time proposing an even larger budget. It doesn't make sense.
Really, is it too much to ask to listen long enough to see what's really going on, instead of getting distracted by petty party politics?
Friday, January 29, 2010
"The Party of NO!"
Let's be real clear on something. The problem arises when the Republicans are known as anything other than "the party of no." There is a reason Republicans and Democrats are known as conservatives and liberals. I'll make my point with salt. To add it conservatively you risk blandness, but you can add more to taste later. To add it liberally you may luck out, but you risk ruining the whole meal. So in politics we need guys to come up and say "it needs salt," but you need the other guys to come up and say, "let me have a look at that." It's a balance. Republicans aren't Libertarians, they believe that there are times when the government can offer a solution, but they are supposed to be slow to come to that conclusion.
Siding first with Capitalism doesn't deny a problem, it denies the understanding of a proper solution. Siding with Capitalism assumes that if there is a need or a desire that someone will figure out a way to fulfill it. If the solution is poor it will fail and disappear. This cycle continues until there are desirable solutions at hand. A solution too liberal can be bad while also restricting or inhibiting a quality solution in the private sector. Unfortunately a bad, or outdated, solution made by the government is hard to turn away from. This can be seen with the Social Security system. It's far inferior to other methods, and yet people have paid into it their whole lives. It would be completely unfair to say they are out of luck, but it currently seems unfair to those paying into it now. For this reason we should be incredibly slow to assume that the government has the best ideas.
Let's say for example that a charismatic politician decides that he wants to end poverty. He comes up with this grand scheme and figures out that he can reduce the poverty level in America to virtually 0%. All he needs is a trillion dollar budget and we will have a record that will leave the rest of the world in a state of awe. It takes someone with a conservative mind to stay, hey wait a minute, that tax burden may destroy our economy and leave us all in a bread line. Simply put, naming a problem doesn't create a solution. A poor solution via stage one thinking can leave us in deeper water then we started in.
The same can be said about a health care bill so bad that they have to bribe Democrats with hundreds of billions in taxpayer dollars just to pass it. You need people questioning what will happen to the state of health care if the government decides to take over the insurance business. How will this effect us in the long term? What will this do to the overall quality of healthcare? Or, How will this effect our economy. Are we sure that we are making the right decision, since backtracking seems to be nearly impossible in the world of government? It doesn't mean that national healthcare is a bad idea. It's a great idea, it simply assumes that the right solution has not been presented, and a commitment so large and expensive needs to be handled with extreme caution.
So to all the Republicans out there, when you hear the title "the party of no," be proud. The politicians are doing their job.
Siding first with Capitalism doesn't deny a problem, it denies the understanding of a proper solution. Siding with Capitalism assumes that if there is a need or a desire that someone will figure out a way to fulfill it. If the solution is poor it will fail and disappear. This cycle continues until there are desirable solutions at hand. A solution too liberal can be bad while also restricting or inhibiting a quality solution in the private sector. Unfortunately a bad, or outdated, solution made by the government is hard to turn away from. This can be seen with the Social Security system. It's far inferior to other methods, and yet people have paid into it their whole lives. It would be completely unfair to say they are out of luck, but it currently seems unfair to those paying into it now. For this reason we should be incredibly slow to assume that the government has the best ideas.
Let's say for example that a charismatic politician decides that he wants to end poverty. He comes up with this grand scheme and figures out that he can reduce the poverty level in America to virtually 0%. All he needs is a trillion dollar budget and we will have a record that will leave the rest of the world in a state of awe. It takes someone with a conservative mind to stay, hey wait a minute, that tax burden may destroy our economy and leave us all in a bread line. Simply put, naming a problem doesn't create a solution. A poor solution via stage one thinking can leave us in deeper water then we started in.
The same can be said about a health care bill so bad that they have to bribe Democrats with hundreds of billions in taxpayer dollars just to pass it. You need people questioning what will happen to the state of health care if the government decides to take over the insurance business. How will this effect us in the long term? What will this do to the overall quality of healthcare? Or, How will this effect our economy. Are we sure that we are making the right decision, since backtracking seems to be nearly impossible in the world of government? It doesn't mean that national healthcare is a bad idea. It's a great idea, it simply assumes that the right solution has not been presented, and a commitment so large and expensive needs to be handled with extreme caution.
So to all the Republicans out there, when you hear the title "the party of no," be proud. The politicians are doing their job.
Wednesday, January 27, 2010
Our Economic Fall and Future Rise
I don't know about everyone else, but it really bothers me to hear President Obama blame the "fat cats" of Wall Street for all of our economic problems. They are to blame, but there are two other groups that are just as guilty, and just as necessary for economic recovery. I believe two of the three are making progress, but the third is just not doing their part. We have the banks, the American consumer, and the government. I think I can base my entire argument around Dave Ramsey, or just about any financial counselor in the last 10 years. It should become obvious, because of the popularity these guys have gained recently, that we have been absorbed by debt, and are attempting to change our financial culture.
First of all, that great economy we lived in for years wasn't even real. While at the beginning of the 20th century most of the jobs in our country dealt with the production or sale of food, it's now based on product sales and customer service. Our economy has been driven by the creation of debt rather than an equal percentage of the production and sale of products. While people may not have seen this on a grand scale, it's obvious that they saw it in their own lives. Everyone that decided to do something about their enormous debt knows that life changes dramatically when you transition from the love of things to some sense of financial responsibility. First, you quit making irresponsible large purchases that weren't really needed in the first place. Second, you break down your bills in a way to start getting out of debt. Third, you start to save and buy your products with money you've already earned. It takes time, but life becomes a lot easier once you get through it.
When the banks started failing as a result of their irresponsible decisions the government thought they could step in and save them. It's more than a little ironic that they chose to do this through the creation of debt by our government. The debt doesn't go away, instead it is managed by the "fat cats" of Washington. It's ultimately useless, and if by chance it would have worked we would have found ourselves in a similar situation a few years later. Sadly, result or no result, the American people now shoulder the financial burden. While people don't want to see it this way, we are worse off for saving them than we would have been had we let them fail.
So where is the solution? I believe the government needs to take a good look at itself. It needs to quit making huge financial commitments we don't really need, pay off the debt we've incurred, and change the financial culture of our government. I believe that they should take a lesson from the rest of our country, and I hope we as voters force them to do so.
First of all, that great economy we lived in for years wasn't even real. While at the beginning of the 20th century most of the jobs in our country dealt with the production or sale of food, it's now based on product sales and customer service. Our economy has been driven by the creation of debt rather than an equal percentage of the production and sale of products. While people may not have seen this on a grand scale, it's obvious that they saw it in their own lives. Everyone that decided to do something about their enormous debt knows that life changes dramatically when you transition from the love of things to some sense of financial responsibility. First, you quit making irresponsible large purchases that weren't really needed in the first place. Second, you break down your bills in a way to start getting out of debt. Third, you start to save and buy your products with money you've already earned. It takes time, but life becomes a lot easier once you get through it.
When the banks started failing as a result of their irresponsible decisions the government thought they could step in and save them. It's more than a little ironic that they chose to do this through the creation of debt by our government. The debt doesn't go away, instead it is managed by the "fat cats" of Washington. It's ultimately useless, and if by chance it would have worked we would have found ourselves in a similar situation a few years later. Sadly, result or no result, the American people now shoulder the financial burden. While people don't want to see it this way, we are worse off for saving them than we would have been had we let them fail.
So where is the solution? I believe the government needs to take a good look at itself. It needs to quit making huge financial commitments we don't really need, pay off the debt we've incurred, and change the financial culture of our government. I believe that they should take a lesson from the rest of our country, and I hope we as voters force them to do so.
Tuesday, January 26, 2010
Tax Cuts VS. Stimulus Packages
I've been wondering for the longest time if people have given any thought to the difference in effect of a tax cut and a stimulus package. It took me awhile to figure out, but I think I finally came up with a few reasons why a stimulus package would be preferred by our wonderful politicians. Though really, why the populous refuses to think this through and see how ridiculous the idea is on an economic level just drives me nuts.
First of all, the politician's motive. Unlike a tax cut, a stimulus package is a one time deal. They don't have to vote to raise or lower later, and it comes with a lot less controversy. Second, if successful, which we will soon see is hardly possible, they gain popularity. Third, it would seem to work a lot quicker, if it worked at all.
Unfortunately, from an economic standpoint, it stands a very slim chance of having any long term effects. One example of this would be the cash for clunkers idea. The theory is that people would go out and sell their old cars and buy new ones. Saving the jobs our auto industries are so quickly losing. It's real effect though is that while costing taxpayers billions of dollars, it only created a temporary incentive to buy cars at a time when Americans aren't wanting to make such a large financial commitment. What good does this do for the auto industry in the months to follow? It would seem to me that these stimulus packages are nothing more than life support for the terminally ill. Which is great for comforting friends and family, but doesn't much matter in the big picture fate has to offer.
Tax cuts, however, would reward the successful and ambitious companies who still had valuable products to offer. Auto industries that didn't make decades worth of poor decisions would still thrive, while the foolish would fade to black. I think we can assume that the demand for vehicles isn't going away any time soon. So we can also assume, in a world of supply and demand, that other companies would come up to replace them. From the failures we would have numerous lessons for the up and coming. Subjects such as; overpowering unions, pensions vs. 401k's, distribution of labor, rate of new technology, etc... We would come out bigger, stronger, and with the kind of jobs that would last for decades. This is how Capitalism works friends, it recycles. If we get in it's way it doesn't mean we are going to stop the process, we just may get lucky and prolong it until the next guy is in office.
Real effective change requires us to quit prolonging the inevitable, and to let nature take it's course.
First of all, the politician's motive. Unlike a tax cut, a stimulus package is a one time deal. They don't have to vote to raise or lower later, and it comes with a lot less controversy. Second, if successful, which we will soon see is hardly possible, they gain popularity. Third, it would seem to work a lot quicker, if it worked at all.
Unfortunately, from an economic standpoint, it stands a very slim chance of having any long term effects. One example of this would be the cash for clunkers idea. The theory is that people would go out and sell their old cars and buy new ones. Saving the jobs our auto industries are so quickly losing. It's real effect though is that while costing taxpayers billions of dollars, it only created a temporary incentive to buy cars at a time when Americans aren't wanting to make such a large financial commitment. What good does this do for the auto industry in the months to follow? It would seem to me that these stimulus packages are nothing more than life support for the terminally ill. Which is great for comforting friends and family, but doesn't much matter in the big picture fate has to offer.
Tax cuts, however, would reward the successful and ambitious companies who still had valuable products to offer. Auto industries that didn't make decades worth of poor decisions would still thrive, while the foolish would fade to black. I think we can assume that the demand for vehicles isn't going away any time soon. So we can also assume, in a world of supply and demand, that other companies would come up to replace them. From the failures we would have numerous lessons for the up and coming. Subjects such as; overpowering unions, pensions vs. 401k's, distribution of labor, rate of new technology, etc... We would come out bigger, stronger, and with the kind of jobs that would last for decades. This is how Capitalism works friends, it recycles. If we get in it's way it doesn't mean we are going to stop the process, we just may get lucky and prolong it until the next guy is in office.
Real effective change requires us to quit prolonging the inevitable, and to let nature take it's course.
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