Saturday, December 24, 2005

About the Budget, Part 1

On Wednesday the US Senate passed, after Vice-President Cheney’s tie-breaking vote, a $39.7 billion dollar budget reduction bill which must be viewed as a very small, albeit a very necessary, down payment in fiscal responsibility. The actual bill included a $30 billion in reduced spending and near $10 billion dollar in new revenues. Had it been a single year’s reduction it would have been far more noteworthy, but the budget reductions are spread over a five year period.

As noted in an earlier piece:

As impressive as that number may seem, it is insignificant when compared to the overall national federal budget of $2.5 trillion or $2,500 billion dollars. Suddenly $6 billion out of $2,500 billion is not quite such an accomplishment.

In personal terms, which are always easier to wrap our minds around, the numbers become truly unimpressive. For a family with a $50,000 annual income, a budget reduction of $120 per year is an equivalent accomplishment. That is a less than $10 per month – not much more than a movie ticket for one patron.

Congress must begin to look at budgets and spending patterns much more seriously. Even with this herald achievement, the Senate included in this bill new special interest spending totaling more than $3 billion dollars. First responders will get $1 billion in grants for new equipment and training, $156 million for a national alert system, $43.5 million for a fully enhanced 911 emergency system, $75 million to help low-power television stations upgrade to digital TV standards, and $30 million to help New York City's DTV transition.

The bill extends for two years a $1 billion dollar subsidy to milk farmers should the price of milk drop below a certain level. And finally, the bill includes $1.5 billion for digital converter boxes to accommodate 20 million homes when the country’s broadcasters complete the transition from analog signals to digital transmission by February 17, 2009 the date approved by the Senate.

Article I - Section 8 of the United States Constitution charges the Congress with the responsibility to “… provide for the common Defense and general Welfare of the United States…” and to “… make all Laws which shall be necessary and proper for carrying into Execution the foregoing Powers, and all other Powers vested by this Constitution ….” Other than $156 million for a national alert system, Congress must explain how and why all the remaining expenditures fit the role and responsibility of a federal government that is $8 trillion in debt and engaged in a war on terrorism.

Non-military and non-homeland security spending has increased more that $303 billion during the 2001 to 2005 fiscal years and has been instrumental in the increase of the national debt from $6 trillion to $8 trillion in the last three years. Now add to that, the Medicare drug benefit which has been estimated at $724 billion dollars over the next 10 years and you begin to see that the Nation’s finances are woefully out of control.

Interest must be paid on all of this deficit spending and it currently stands as the third largest expenditure in our fiscal budget. At $26 billion a month and growing quickly, it soon will be the second largest budget item and it represents non-discretionary interest only payments. That means future generations will be burdened with similar interest payments while attempting to pay down the debt load our free-spending Congress has created with the concurrence of “we the people…” through our silence.

It is far beyond the time for the American public to demand change in how our government operates. At a time when our Nation is hampered by special interest groups and their long time bond with career politicians, “we the people …” must reclaim Abraham Lincoln’s vision that this government “of the people, by the people, and for the people” will have a re-birth.

The citizens must speak out and reclaim their vision of America; which is far, far different than the special interest groups and the politicians who partner with them. We must start by telling Congress that the Deficit Reduction Act of 2005 is only a down payment towards true fiscal responsibility, tough decisions lie ahead, and we expect our political leaders to follow through with the management role we have entrusted to them.

William G. Pierce

12/28 Update: Added link in the eighth paragraph.


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