Cutting the Federal Budget

By Gerald "Jerry" Hashimoto

Just how bad is the Federal Deficit?

total federal income	$2 trillion
total federal spending	$3.5 trillion
federal deficit	$1.5 trillion

To put it another way: The gov't went into debt $5,000 for every man, woman, and child, and that's just one year's worth of spending. Is the President going to pay it back next year? Nah: for each of the next 3 years, the same thing will happen. This is a debt that our children and grandchildren will have to pay back. To me, this is unconscionable. We are stealing the future fortunes of our children. Generational theft indeed. What should the federal government do? Easy: the same thing you and I do when our credit cards get maxed out: cut spending until we stop going into debt. Here is my plan.

FREEZE!

I mean the whole kit and kaboodle, including the politically popular spending programs: Social Security, Medicare, Medicaid, Welfare, Food Stamps, and Defense. Now that spending increases have stopped, we can play politics: what should be cut, what should be increased, all the while remembering that it is a zero-sum game. Yes, there will be winners and losers. It is high time to make the difficult decisions.

REFORMING MEDICAID

It is almost impossible to cut Medicaid (free medical care for the poor) spending, even if Congress had the political will. Medicaid legislation is a complex, interlocking web of mandates, regulations, and requirements. The entire shootin' match should be converted into one, huge, simple, no-strings-attached block grant. The states can spend it anyway they want, and it is easy for Congress to ramp the spending levels up or down as budgetary pressures demand.

ELIMINATE DEPT. of EDUCTION and ENERGY

OK, this was originally President Reagan's idea. The entrenched political powers prevented this. It is time to reconsider this fine idea. The Dept of Education was invented by President Carter as a reward to teacher unions, who had made the difference in a very close election against President Ford. The Dept. of Energy was also invented by Carter to run the doomed SynFuels Corporation: it was to gasify coal into fuel, so-called gasohol. It was a $20 billion disaster that never had a chance. Both of these cabinet posts were simply political sops, and have no justifiable reason for existence. Let us just chuck `em into the garbage.

ELIMINATE DEPT. of LABOR and AGRICULTURE

Eliminate Dept. of Labor and Agriculture These departments are simply piggy banks for labor unions and big agribusiness. These are large, rich, powerful organizations that surely can fund their own piggy banks and do not need taxpayer money. All 4 of these cabinet posts do have some regulatory function, but these residual functions can easily be folded into other cabinet posts, like HHS or Commerce.

FREEZE FEDERAL JOBS

Like a regular, capitalistic business, the largest cost of running the Federal government is labor costs. So: just freeze all federal hiring and all federal wages. President Reagan did this, and it worked nicely to bring down the cost of running the Federal government. Total federal employees will gradually go down from attrition (we won't have to put in a RIF, Reduction in Force), and jobs and positions and departments will be gradually merged over time.

CONTROLLING the ANNUAL FEDERAL BUDGET

Congress and the President are spending money like drunken sailors (no offense intended to inebriated naval personnel). There are several good ways to reduce spending. Gramm-Rudman-Hollings did a dandy job of keeping spending under control, but congress got rid of it because they like to spend money; just re-enact it. The president should have a line-item veto, just like many state governors do. We could also vote for a balanced budget amendment. Even Keynes thought that the government should always have a balanced budget, and run a deficit only in emergencies (like now).