As Speaker of the House, John Boehner (R-OH 8th), said in his remarks after being sworn in as the leader of the 112th Congress, now comes the “hard work and tough decisions”.
We have reached a tipping point where the political / governmental ruling class now spends considerably more than it can ever take in. The federal budget must be cut now.
Back in October of 1987, Warren T. Brookes (Detroit News), writing in Reader’s Digest sited a study by Ohio University economists Lowell Gallaway and Richard Vedder, that simply stated that since 1947 every one dollar ($1.00) tax increase corresponded with a $1.58 in new spending. It is now 2011 and that differential has continued unabated. It is any wonder we find our nation in the financial mess it is in.
There is a roadmap for achieving the $100 billion in savings that the Republicans committed to in their campaign “Pledge”. Stated therein, “Cut government spending to pre-stimulus, pre-bailout levels saving at least $100 billion in the first year alone.” It will take a great deal of fortitude and the ability to sharpen the budget axe.
The following figures are based on the Fiscal Year 2011 (FY 2011) budget numbers. If the cuts are implemented it will reduce approximately $260 Billion in federal spending.
First, three departments and/or agencies should be completely eliminated.
Department of Education. Americans have always prided themselves on local control of schools. It should remain so. It makes absolutely no sense in sending valued tax dollars to a bloated Washington D.C. bureaucracy. Have them skim off a good portion of those dollars and then send the remainders back to the states. This is a department that was created during the Carter administration as payback to the teachers unions that supported him. It is essentially a department of paper pushers. The necessary functions can easily be folded back into a re-created Department of Health Education and Welfare.
Department of Energy. Essential functions can be folded into other departments like defense and other applicable agencies.
Corporation for National and Community Service. This governmental agency houses Americorp, among other things. Get rid of it. The savings would be $967 million dollars.
Second, let’s apply a twenty percent (20%) across the board cut to each of the following agencies. It would be the responsibility of each department secretary to recommend which discretionary spending should be cut.
Department of Agriculture Savings: $26.459 billion.
Department of Commerce Savings: $ 1.850 billion.
Department of Labor Savings: $23.343 billion.
Department of Interior Savings: $ 2.615 billion. Eliminating the Bureau of Indian Affairs alone would save 2.586 billion.
State Department Savings: $10.761 billion.
Environmental Protection Agency Savings: $ 1.834 billion.
National Science Foundation Savings: $ 1.359 billion. Additional savings could be realized by folding this agency under the auspices of NASA.
Small Business Administration Savings: $ 239 million.
Housing and Urban Development Savings: $ 9.507 billion.
Health and Human Services Savings: $180.170 billion. This department would be re-created into HEW by folding certain aspects of the Department of Education into it.
Third, the Department of Defense should be reconfigured to merge the Department of Homeland Security and the Department of Veterans Affairs to allow for additional cost savings by consolidating duplicated functions. Defense Secretary Gates has already proposed $78 billion in cuts. Congress should give his recommendations vigorous analysis and act on those that would not impair the ability of our armed services to defend this country.
A much-needed cut in this area is the Veterans Medical system. Facilities around the country that are not on a military installation should be closed. It is important that we maintain our commitment to those that have served by providing them with the best possible medical care. Provide them with a Military Medical Card and allow them to use it with any doctor or medical facility in the country. This alone would bring about greater efficiency to the care of our veterans.
Finally, one of the biggest budget items weighing in at $791.681 billion is the Social Security Administration. It is imperative that Congress removes this from the federal budget and put the funds in a lock box. A path should be created that transitions it from the current Ponzi scheme it has become into a supplemental retirement fund it was set up to be. Time does not permit a thorough examination of this issue. On another date I will analyze it more fully.
In order to return our nation back to a better fiscal place, cuts must be made. Are these proposed cuts draconian? Not really. Would government workers be laid off? Yes, but if they are truly talented individuals they can function greatly in the private or independent sector by growing each. The time is now to make the cuts. Failing to do so will bring the nation to ruin.
Showing posts with label Social Security. Show all posts
Showing posts with label Social Security. Show all posts
Friday, January 7, 2011
Monday, November 8, 2010
Election 2010 Aftermath
The historic results of the 2010 mid-term elections have given the nation hope that the socialist policies of the current administration can be turned back. Come January 2011 the U.S. House of Representatives will be in firm control of the Republicans with as many as 245 members. Additionally, the Republicans will have 47 members meaning no longer will Democrats be able to break any filibusters. It is possible the Republicans may be able to have a defacto majority on many key issues, as there are many more Democrats up for re-election in 2012.
Abraham Lincoln once said, “ Leadership is, at times, a painful burden”. This is what the Republicans in the 112th Congress must be prepared to do; provide leadership on a full range of issues. First, is getting the economy back in full health. The majority must prioritize, engage, and execute these matters as quickly as possible.
Win. Win. Compromise!
Both sides have carved out their positions on the extension of the Bush tax cuts. President Obama has left the door open a little by saying he would look at a short-term extension for some income levels. While Senator Orrin Hatch has tipped the Republican’s hand by stating that he would be open to a temporary extension of three years.
The measure they should negotiate and pass in the lame duck session should be an extension of the “tax cuts” and expansion of the brackets of Obama’s “middle-class”. Additionally, pass Obama’s proposed quasi-accelerated cost recovery that would allow businesses write off major capital purchases instead of depreciated those assets over their useful life.
This is the type of compromise that can be achieved. It would allow Republicans a victory going into 112th Congressional season. It would allow Obama to save some face and get the economy rolling again. Politically it would be a draw. Both sides would have bragging rights before the real battles begin at the turn of the year.
The Battles Begin in January
Health Care Reform. Republicans and the few pro-growth Democrats left standing, should immediately move to dump Obama-care. Repeal, reform, and re-submit the legislation making it simple and free-market oriented. This is what many Americans had on their minds when they went to the polls. Speaker-elect, John Boehner, will need to work hard to guide this new improved legislation through under the threat of veto. Pass it. Let President Obama veto it if he dares.
Cut Government Spending. While Senator-elect, Rand Paul (R-KY), has already proposed an across the board cut of five percent which is laudable, more needs to be done. Republicans need to muster the will to cut deeper in order to get the nation’s balance sheet back in the black. Take out the budget axe and get it done 112th.
Social Security. It must be reformed and reinvigorated for it to survive. Newly elected Representatives and Senators should think outside the box to get the job done. Do it now, well in advance of the 2012 elections.
The Pledge. Republicans must adhere to all of the principles laid out in their “Pledge to America”. First, all of the economic matters must be dispensed with in order to have prosperity moving forward.
Important pieces of legislation will be worked on in the new 112th Congress. It is incumbent upon our newly elected officials to work diligently to turn around the specious policies passed by the Obama, Pelosi, and Reid troika. It will take considerable tenaciousness and courage. Which leads to another famous quote by Abraham Lincoln, “Courage is loss through disuse”.
Abraham Lincoln once said, “ Leadership is, at times, a painful burden”. This is what the Republicans in the 112th Congress must be prepared to do; provide leadership on a full range of issues. First, is getting the economy back in full health. The majority must prioritize, engage, and execute these matters as quickly as possible.
Win. Win. Compromise!
Both sides have carved out their positions on the extension of the Bush tax cuts. President Obama has left the door open a little by saying he would look at a short-term extension for some income levels. While Senator Orrin Hatch has tipped the Republican’s hand by stating that he would be open to a temporary extension of three years.
The measure they should negotiate and pass in the lame duck session should be an extension of the “tax cuts” and expansion of the brackets of Obama’s “middle-class”. Additionally, pass Obama’s proposed quasi-accelerated cost recovery that would allow businesses write off major capital purchases instead of depreciated those assets over their useful life.
This is the type of compromise that can be achieved. It would allow Republicans a victory going into 112th Congressional season. It would allow Obama to save some face and get the economy rolling again. Politically it would be a draw. Both sides would have bragging rights before the real battles begin at the turn of the year.
The Battles Begin in January
Health Care Reform. Republicans and the few pro-growth Democrats left standing, should immediately move to dump Obama-care. Repeal, reform, and re-submit the legislation making it simple and free-market oriented. This is what many Americans had on their minds when they went to the polls. Speaker-elect, John Boehner, will need to work hard to guide this new improved legislation through under the threat of veto. Pass it. Let President Obama veto it if he dares.
Cut Government Spending. While Senator-elect, Rand Paul (R-KY), has already proposed an across the board cut of five percent which is laudable, more needs to be done. Republicans need to muster the will to cut deeper in order to get the nation’s balance sheet back in the black. Take out the budget axe and get it done 112th.
Social Security. It must be reformed and reinvigorated for it to survive. Newly elected Representatives and Senators should think outside the box to get the job done. Do it now, well in advance of the 2012 elections.
The Pledge. Republicans must adhere to all of the principles laid out in their “Pledge to America”. First, all of the economic matters must be dispensed with in order to have prosperity moving forward.
Important pieces of legislation will be worked on in the new 112th Congress. It is incumbent upon our newly elected officials to work diligently to turn around the specious policies passed by the Obama, Pelosi, and Reid troika. It will take considerable tenaciousness and courage. Which leads to another famous quote by Abraham Lincoln, “Courage is loss through disuse”.
Monday, September 28, 2009
Social Security: Our Sovereign Wealth Fund
As addressed in an earlier post, I felt that the Social Security is one of the main issues that would need to be given priority by the new administration. Now Social Security is percolating to the top of the issue docket. The recent news by the Associated Press that the system will see a $10 million dollar deficit in 2010 due to a number of older Americans seeking benefits as a result of layoffs and business closures in this troubled economy, will surely bring the issue to a boil. Add to that a recent discussion on MSN--money which stated that seniors will not see a cost of living increase in their monthly checks. Plus the mention of it in Steve Forbes Fact and Comment column in Forbes magazine. Social Security will soon be the lead issue in Americans minds.
Forbes in his excellent column states that things would be different now, had FDR accepted the Clark Amendment to the Social Security legislation enacted in 1935. The amendment would have given Americans a choice between the public option (Social Security) or a private insurance plan.
While Social Security has become the third rail in American politics, it merits robust discussion which will move it toward beneficial reforms. I once thought it should be a voluntary, private system. It seems to me that Social Security should be a requirement as part of our social safety net. With the recent Madoff scandal and greedy Wall Street bankers robbing and pillaging funds and their subsequent theft of taxpayer dollars in the form of bailouts, Americans are a little fearful of where they put their retirement funds. The financial mess we find ourselves in is one giant burr in the American saddle.
Social Security should be reformed and transformed into Our Sovereign Wealth Fund. Yes, it is a supplemental retirement fund. That was the original legislative intent behind it. Further steps need to be taken to strengthen the system.
Social Security is for all American citizens. All should be included without regard to income level. The following reforms should be implemented for a solid Sovereign Wealth Fund to be created benefiting us all:
Forbes in his excellent column states that things would be different now, had FDR accepted the Clark Amendment to the Social Security legislation enacted in 1935. The amendment would have given Americans a choice between the public option (Social Security) or a private insurance plan.
While Social Security has become the third rail in American politics, it merits robust discussion which will move it toward beneficial reforms. I once thought it should be a voluntary, private system. It seems to me that Social Security should be a requirement as part of our social safety net. With the recent Madoff scandal and greedy Wall Street bankers robbing and pillaging funds and their subsequent theft of taxpayer dollars in the form of bailouts, Americans are a little fearful of where they put their retirement funds. The financial mess we find ourselves in is one giant burr in the American saddle.
Social Security should be reformed and transformed into Our Sovereign Wealth Fund. Yes, it is a supplemental retirement fund. That was the original legislative intent behind it. Further steps need to be taken to strengthen the system.
Social Security is for all American citizens. All should be included without regard to income level. The following reforms should be implemented for a solid Sovereign Wealth Fund to be created benefiting us all:
- Lower the payroll taxes to 5% for the employee and the employer. Self-employed Americans should pay no more than 10%.
- Limit the payout (remember it is a supplemental retirement fund).
- Similar to a 401K program, the system should allow people to select different investment programs to beef up their monies placed into the fund.
- The Social Security Administration should not just invest in US Treasuries, but also invest in other debt, equities and real estate to provide growth and income in the fund. Congress should place strict risk restraints on the fund's investment officers.
- Move the entire system out of the orbit of the Congressional cookie monsters. Put it in a "lock box" and keep the Potomac Pirates' mitts out of the cookie jar.
- Everyone working in America should pay in. American citizens would receive benefits based on the funds they invested into the system. There should be no income level cut-off (currently at $106,000). Call this the Buffet tax, if you get my drift.
- The payout from social security to retires should not be subject to federal income taxation. Retirees receiving social security payments should also be allowed to earn as much income outside of Social Security without penalty.
All of these reforms will strengthen Our Sovereign Wealth Fund: Social Security. Feds nailed Bernie Madoff on his Ponzi scheme, it is now our turn to nail the Feds on their Ponzi scheme. Lets takeover Social Security and create Our Sovereign Wealth Fund.
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