Stupid Spending

I was told about a webpage named www.reason.com . This page appears to be a
libertarian news page. It is very interesting and provides commentary on isssues
that need to be discussed and actioned. For instance, I came across an excellent
article called Budget Insanity. The author is John Stossel. I don't know
anything about this guy but I like the article.

He puts our "Stupid Spending" policy in proper perspective.

We're always one massive spending bill away from having a better
economy.


John Stossel | July 11, 2012







Last year, Congress agreed to $1.2 trillion in
automatic spending cuts, unless politicians find other things to cut. They
didn't, of course. So now, with so-called sequestration looming in January,
panic has set in. Even the new "fiscally responsible" Republicans vote against
cutting Energy Department handouts to companies like Solyndra and subsidies to
sugar producers. Many claim that any cut in military spending will weaken
America and increase unemployment.
It's another demonstration of the
politicians' addiction to spending -- and how we are complicit. "One more
infrastructure bill" or "this jobs plan" will jumpstart the economy, and then
we'll kick our spending addiction once and for all.
But we don't stop.
For
most of American history, government was tiny. But since Lyndon Johnson's Great
Society and the promise that government would cure poverty, spending has gone up
nonstop. This is not sustainable.
Progressives say: If you're so worried
about the deficit, raise taxes! But it's a fantasy to imagine that taxing the
rich will solve our deficit problem. If the IRS grabbed 100 percent of income
over $1 million, the take would be just $616 billion. That's only a third of
this year's deficit.
It's the spending, stupid.
Even if you could balance
the budget by taxing the rich, it wouldn't be right. Progressives say it's wrong
for the rich to be "given" more money. But money earned belongs to those who
earn it, not to government. Lower taxes are not a handout.
That's the moral
side of the matter. There's a practical side, too. Taxes discourage wealth
creation.
Even if you think -- despite all evidence -- that government spends
money more usefully than people in the private sector, there is a limit to how
much government can tax before people work less or flee.
Progressives claim a
small increase in tax rates won't stop the wealthy from producing. But some
would stop. When the top marginal rate was 90 percent, actor Ronald Reagan
worked just half the year. He said that woke him up to the damage that high
taxes impose.
Higher taxes give rich people and politicians more reasons to
collude. The rich make contributions, and politicians pay the rich back by
giving them tax loopholes.
That's a big loss to America. That money and
creative energy spent on figuring out taxes might have gone to build new
products, make music, cure cancer or ... who knows what?
Politicians promise
to balance the budget by getting rid of what is wasteful, redundant or
unnecessary. There's plenty of that, but they have promised to eliminate it for
years. They cannot. It's just in the nature of the beast. Centrally planned
monopolies do things that are wasteful, redundant and unnecessary.
What will
bankrupt us first are the wealth transfers to my generation: Medicare and Social
Security
When FDR started Social Security, most people didn't even live to
age 65. Today, we average 78 -- and we baby boomers demand all the cool new
stuff that modern medicine invents: anti-cholesterol drugs, hip replacements,
etc. And we don't want to pay for most of it because we've been trained by
government to assume that we're entitled to these things for free, or nearly
free. We paid into Social Security and Medicare for our entire working lives,
and damn it, we're entitled to get our money
back!

Few of us realize that most of us get back up
to three times what we paid in, that politicians have promised Social Security
and Medicare recipients an impossible $46 trillion more than will exist and that
our sense of entitlement will ruin America much faster than foreign aid,
subsidies for NPR or foreign wars ever will.
Amazingly, we could grow our way
out of debt if Congress simply froze spending at today's levels. That would
balance the budget by 2017. If spending growth were limited to just 2 percent
per year, the budget would balance by 2020!
But the politicians won't do even
that.
It's depressing writing this. But it's not hopeless. There are examples
of fiscal sanity we can follow -- if we have the will.
John Stossel (read his Reason archive) is
the host of Stossel, which airsThursdays on the FOX Business
Network at 9 pm ET and is rebroadcast on Saturdays and Sundays at 9pm &
midnight