Budget Cuts Across the Board!

With all of the discussion about deficits, debt and government budgets, we see all of the usual suspects coming out of the woodwork to cry that you can't cut THEIR thing...THEIR thing is the most important of all.  Apparently, if we even cut 1% of the budget, terrible, terrible things will happen.  Children will starve to death, old people will be made homeless and all infrastructure and public safety services will fail..."real wrath of God type stuff. Fire and brimstone coming down from the skies! Rivers and seas boiling! Forty years of darkness! Earthquakes, volcanoes...The dead rising from the grave! Human sacrifice, dogs and cats living together... mass hysteria"*

The facts are that, as seen in the chart to the left, the median household income in the U.S. has gone up 29% in inflation adjusted dollars since 1970, while Federal government spending has increased by 242%...with no end in sight. And we are supposed to believe that there is no fat at all in the Federal budget to be trimmed.  They need every penny of tax dollars they can get, and more.  Trust them, they say.  They only have your best interest in mind.

In a previous post, Why Feed the Pig, I lay out the reasons why it doesn't make sense to launder our tax money through Washington D.C.'s leviathan bureaucracy to fund our country's infrastructure.  They add no value to the process and use our own money to buy votes.  But there are many other examples of monumental fat and waste across the spectrum of government.  Dr. Thomas E Woods, Jr. documents many of these in his latest book, Rollback.

Let's look at one of the touchiest subject of all, welfare programs.  Even if you take as fact that everyone...or at least most everyone...on welfare today absolutely need and "deserve" it. The system itself is bloated and inefficient beyond repair.  As Dr. Woods points out:

"Another way to approach it is to recall that at least two-thirds of the money assigned to government welfare budgets is eaten up by bureaucracy.  Taken by itself, this would mean it would take three dollars in taxes for one dollar to reach the poor.  But we must add to this the well-founded estimate of James Payne that the combined public and private costs of taxation amount to 65 cents of every dollar taxed.  When we include this factor, we find the cost of government delivery of one dollar to the poor to be five dollars."

Is this an efficient...or even sane ...use of your tax dollars?  Where there is such a huge amount of bureaucratic overhead, there is fat to be cut.  But, you see, that fat represents a block of people who's product and trade is to put people on and maintain welfare programs.  To protect themselves, they perpetuate the myth that any money cut would directly remove food from the mouths of the poor, health care from the elderly, and safety from the children.  This is all about maintaining the status quo.  "We have to protect our phoney baloney jobs here, gentlemen! We must do something about this immediately! Immediately! Immediately! Harrumph! Harrumph! Harrumph!"**

This does not even deal with the fraud and misuse of the systems or whether all of this welfare spending even provides us with what it promises.  Ask yourself if poverty and crime rates are better or worse as a result of all of the so-called Great Society programs.  The answer is that things, by all objective measures have gotten worse, not better.  Don't we have a right to expect that our taxes are being used in an effective manner?  Dr. Woods offers another insightful point on this issue:

"What if poverty, crime and social dysfunction had been very high before the Great Society programs were instituted and then were dramatically reduced?  Can we doubt that its advocates would have attributed the decline in these features of inner-city to the government's wise new programs?  Yet when things work the other way, and the inner-cities become almost unlivable after these programs were introduced, we're hastily assured that the one has absolutely nothing to do with the other."

But what about Education?  Surely there is no fat to be cut here!  It is all for the children, after all.  Well, here again, the truth is different from what those who would protect their fiefdoms would tell you.  Just ask yourself if it is a necessity for high schools to have AstroTurf on their football fields or computerized white boards in their class rooms?  Boards not even found in my son's computer engineering classes at  the university.  But any talk of cuts in education inevitably leads to claims that teachers will be fired and quality of education will fall.

So, as with the welfare issue, let's examine the relationship of educational spending to quality of education, as measured by test scores.  If  an increase in spending would correlate to better test scores, the Educrats (educational bureaucrats) may have a case.  But in fact, it seems, according to statistics from the National Center for Education Statistics, as compiled into the chart above by the Cato Institute, increased spending has no distinguishable effect on test scores.  From the data represented by this chart, a case could reasonably be made that we could cut inflation-adjusted spending back to the level of 1970 without negatively affecting test scores.

Again Dr. Woods points out that while education spending has skyrocketed, "in 2003, the federal government found only 13 percent of Americans at or above age sixteen to be proficient in reading prose, following written directions, and carrying out quantitative tasks."  Is this an acceptable return on your education dollars?

And how about one for the "Far Right?"  Military spending.  No patriotic American could suggest that we can or should cut military spending, right?  Surely if we cut defense spending our brave and deserving warriors and their families will go without food and basic necessities.  At least this is what the leaders of the, as Dwight D. Eisenhower called it, military-industrial complex would have you believe.

A big problem with assessing fat in military spending is that the Department of Defense is not subject to audit.  That fact alone should raise huge red flags.  A department of the government responsible for approximately 20% of the federal budget with no audits; no chance of abuse there, huh?  Add to this the manner in which Defense Department procurement is carried out through cost-plus and fixed-fee contracts, rather than sealed bids like most of the rest of the rest of the country operates and you get an environment primed for gross inefficiencies at best and massive fraud at worst.

These issues are not Republican issues or Democrat issues.  They have come about and been defended by the actions of both parties.  It is issues like these, and many others, that have lead to incredibly bloated and feckless juggernaut we call government.  There are no departments, no bureaus, no offices of government that do not have considerable fat that can be cut...and without adversely affecting their stated missions.

The problems of our economy, the deficits and crushing debt, are far to large and intricate for our politicians to sort through with a fine tooth comb.  They are also too fraught with political pit falls.  But, it is up to our representatives to solve the problems.  So what should they do?

I believe that the only workable solution is to make cuts, by a given percentage, across the board...all budgets.  Congress should mandate that the heads of each governmental department come up with plans to cut their budget by the proscribed amount.  This mandate would come with the direction that no vital services will be cut.  There is to be no "playing politics."  The bureaucrats should be put on notice that this is a mandate from the people and failure to make the cuts in an appropriate way will mean that heads will roll...starting at the very top.  This method will take control back from the bureaucrats and avoid the appearance of any political favoritism.  Republicans and Democrats could come together in a bi-partisan manner and proclaim the real dangers we face if the cuts are not made.

I think that as a first step, the budget could be cut by 20%.  After this, Congress could begin to look for whole departments that could be eliminated.  The Department of Education, which has only been around since 1979, adds little or no value in actually providing education to our children.  As we have seen above, they have also not been a positive influence on test scores.  Department of Energy?  What good has that done?  Soaring oil prices and no viable alternative sources of energy.  Well, you get the point.

All of these bureaucracies claim that they could indeed do what they are tasked with...if only they had more money...and control.  Well, they have had more than 40 years to try.  I say times up and remind you of Einstein's definition of insanity: "doing the same thing over and over again and expecting different results."

One more quote from Rollback.  This one brings home the ridiculousness of our current situation:

"Every year $250 billion is borrowed from China so the U.S. government can play superpower. (Paul Craig Roberts, assistant secretary of the Treasury under Ronald Reagan was more blunt: 'A country whose financial affairs are in the hands of foreigners is not a superpower.')"

* from the movie Ghost Busters (1984)
** from the movie Blazing Saddles (1974)