The two-year budget deal that president Trump signed on February 9 adds almost $500 billion to the budget deficit that was projected for the coming year. Why? Isn’t Trump supposed to be slaying the debt monster?
Yes, and this spending bill is alarming. But then again this is what we get with spineless Republicans and aggressive Democrats. After decades of massive handouts to the Welfare State Democrats want more, more, more. And if they don’t get it they go bonkers and call Republicans every name in the book.
We should be eliminating funding for Amtrak, National Public Radio and ‘global warming’ grants, and paring back endless food stamp handouts and the bloated budgets for EPA, the Education Department and on and on and on.
Medicare started out in 1965 at $10 billion and it now is $600 billion per year even though it only serves about three times as many people as 1965. This needs to be cut way back. There’s tons of fat in these programs.
The main reason for the deficit increase was something called ‘static accounting’ which assumes that the tax cuts passed in December will lead to less money for the government.
This is true in the short run, but not over time. President Ronald Regan cut tax rates on top earners by 60% but revenues to the federal treasury did not fall 60% – they increased by 91% over 8 years because of all of the economic activity produced by the tax cuts. Historical records show that low-tax economies thrive and high-tax economies stagnate.
The only good part of the budget deal is a much-needed $165 billion increase in defense spending – $80 billion in fiscal 2018 and $85 billion in fiscal 2019. These are necessary after Obama gutted the military.
As a percentage of our total economy (GDP) defense spending under Obama fell to almost 3% of GDP which is extremely low and only was matched by Democrats Bill Clinton and Jimmy Carter.
Under Reagan in the 1980s that figure grew to more than 6%, which is how we got the Soviet Union to surrender without firing a shot, i.e., we outspent them. Trump wants to get military spending up to 4% and more which he can easily do with a strong economy.
During World War II US defense spending reached 37% of GDP in order to produce the millions of tanks, aircraft, bombs, trucks, guns, uniforms, etc. to win the war. That would be equal to $7.4 trillion per year in today’s dollars. Meanwhile US military spending in 2017 was about $580 billion.
Increased defense spending also will greatly stimulate the economy. Despite liberal propaganda to the contrary military weapons spending is the most productive form of government spending in its return to the economy, including high-paying jobs with private-sector defense contractors, and federal and state taxes paid by defense workers to the government. The roaring economy of World War II and after proves this point.
Weapons spending provides jobs for some of the most educated and skilled workers and has an added bonus – it incubates new technologies for our general economy just as military technology has spilled over into civilian life for thousands of years. For instance, the internet started as a military project.
Going back in history bronze weapons made by the warrior Spartans in Ancient Greece advanced bronze technology for the general economy. Efficient designs for Greek military ships became available for commercial use.
President Trump knows that strong economic growth produced by the 2017 tax cut bill will do two things – it will provide the cash for increased military spending; and it will bring down the national debt by “growing out of it”. Good.
Now here are some thoughts about president Trump’s plan to reform the Washington, DC bureaucracy. Gregory Korte at USA Today reports:
President Trump will seek to “hire the best and fire the worst” federal government employees under the most ambitious proposal to overhaul the civil service in 40 years, officials said.
… Trump foreshadowed the proposal in a line in his State of the Union address last week: “Tonight, I call on Congress to empower every Cabinet Secretary with the authority to reward good workers and to remove federal employees who undermine the public trust or fail the American people,” he said.
Trump is using the VA Accountability Act, which gave the Secretary of Veterans Affairs greater authority to fire and discipline workers, as a model. The White House says that law has resulted in the dismissal of 1,470 employees, the suspension of 443, demotions for 83 others last year.
This is good news and this is just the start. One of the primary economic problems facing any country is a creeping government bureaucracy that consumes more and more of the nation’s wealth while getting less and less done and thwarting the economy.
As a private citizen in New York City Donald Trump showed how his idea would work. After corrupt city bureaucrats had spent 6 years and $13 million trying to fix the defunct Wollman ice skating rink in Central Park in the 1980s Trump took over the project and supervised the repair privately. The job was done in 6 months for $3 million.
Imagine this type of accountability all across the federal government. USA Today also reports:
Another pillar of the proposal would reduce automatic pay increases and instead use that money for a performance bonus pool.
Under the current system, federal employees get a review every one to three years. Employees whose performance is “fully successful” — as 99.7% are — get a within-grade “step” increase in addition to annual cost-of-living increases.
This must end. As tens of millions of Americans have lost their incomes and their jobs over the last 30 years, bureaucrats in Washington have always gotten steady pay, benefit and pension increases. This is truly ‘the Swamp’ at work.
Nikitas3.com felt this effect back in Massachusetts in 1981. I badly needed a job and got temporary employment in my city with a social service agency. After a few days I realized that I didn’t even have to show up for work so I only went in to pick up my check once a week. After the six weeks passed the boss offered me permanent employment. I said no thanks.
Shockingly CNSNews.com reports:
The five richest counties in the United States when measured by median household income are all suburbs of Washington, D.C., according to the American Community Survey data released today by the Census Bureau.
According to the American Community Survey’s new five-year estimates (2012-2016), the five richest counties in the country are: Loudoun County, Va., where the median household income was $125,672; Falls Church City, Va., where it was $115,244; Fairfax County, Va., where it was $114,329; Howard County, Md., where it was $113,800; and Arlington County, Va., where it was $108,706.
And who lives in these suburbs? Federal workers do. These federal workers need to have their ears pinned back. They are stealing us blind and living like kings while many parts of America suffer.
(Please bookmark this website and send this article by e-mail to your friends. Please recommend this site to all of your friends via Facebook and any other means. Let’s make Nikitas3.com the #1 conservative site by word of mouth. And if you would like to contribute to Nikitas3.com, please click the link at the upper right where it says “support this site”. Thank you, Nikitas)