This week, the President gave the “State of the Union” address to Congress. I don’t watch these as they always sound like campaign speeches. They are a chance for the President to defend what he has been doing and point at others at their bad ways.
He did though touch on the Federal budget deficit and said what we want to hear. He said we must cut spending. He also said though that we must “invest” in infrastructure and in education and in high speed rail. Well, we can’t afford to have our government “invest” any more. It’s time to cut spending to be LESS, yes, less, than tax revenue. I’ve done this before and I’ll do it again. Below I’ll show you how I’d drastically cut our budget and get spending to 95% of revenue NOW, not later. Below is our 2010 budget. 2011’s budget breakdown isn’t out yet.
2010 Federal Budget
Mandatory spending: $2.009 trillion (-20.1%)
- $695 billion (+4.9%) – Social Security
Cut it by 10%. Lower payout to recipients. Elimination of dependent payments to children. Savings of $70 billion
- $571 billion (−15.2%) – Other mandatory programs
I don’t like “other”. 50% reduction. Savings of $286 billion
- $453 billion (+6.6%) – Medicare
Cut by 10%. Eliminate Part D (prescription drug plan). Benefits lowered. Savings of $45 billion.
- $290 billion (+12.0%) – Medicaid
Cut by 80%. This should ONLY be for the poorest of poor. No more paying people to have babies. Folks need to take personal responsibility for their lives. This includes asking charities for help who can provide moral guidance, compassion and medical help at a lower cost. Savings of $232 billion
- $164 billion (+18.0%) – Interest on National Debt
- $11 billion (+275%) – Potential disaster costs
- $0 billion (−100%) – Troubled Asset Relief Program (TARP)
- $0 billion (−100%) – Financial stabilization efforts
Now, I have carved $633 billion from “mandatory” spending.
Discretionary spending: $1.368 trillion (+13.1%)
- $663.7 billion (+12.7%) – Department of Defense (including Overseas Contingency Operations)
I am for defense spending. But, we have to spend less and get more. There is so much wasted in DoD spending. Cut it by 10%. Savings of $66 billion.
- $78.7 billion (−1.7%) – Department of Health and Human Services
If we’re cutting Medicare and Medicaid, we can cut the folks that manage them (as well as other useless programs.) Cut by 25%. Savings $16 billion
- $72.5 billion (+2.8%) – Department of Transportation
Cut by 30%. They are useless. $22 billion in Savings
- $52.5 billion (+10.3%) – Department of Veterans Affairs
- $51.7 billion (+40.9%) – Department of State and Other International Programs
This needs to be stripped by a lot. It’s gone up too much lately. 40% cut. $21 billion in savings.
- $47.5 billion (+18.5%) – Department of Housing and Urban Development
Cut by 60%. People need to get out there and pay for their own places. HUD needs to eventually go away. Savings of $29 billion
- $46.7 billion (+12.8%) – Department of Education
This should be a statics agency to aid schools in their effort to standardize. It shouldn’t be another welfare program nor should it be promoting curriculum and operations and social engineering. Cut it by 70%. $28 billion in savings.
- $42.7 billion (+1.2%) – Department of Homeland Security
- $26.3 billion (−0.4%) – Department of Energy
- $26.0 billion (+8.8%) – Department of Agriculture
This has increased too much. 10% cut. Savings of $2.6 billion.
- $23.9 billion (−6.3%) – Department of Justice
- $18.7 billion (+5.1%) – National Aeronautics and Space Administration
Increase of 10%. Cost of $1.9 billion
- $13.8 billion (+48.4%) – Department of Commerce
This has increased too much. Cut by 20%. Savings of $2.8 billion.
- $13.3 billion (+4.7%) – Department of Labor
Cut 10%. Savings of $1.3 billion
- $13.3 billion (+4.7%) – Department of the Treasury
Cut 10%. Savings of $1.3 billion
- $12.0 billion (+6.2%) – Department of the Interior
Cut 10%. Savings of $1.3 billion
- $10.5 billion (+34.6%) – Environmental Protection Agency
Cut 20%. Savings of $2 billion
- $9.7 billion (+10.2%) – Social Security Administration
Cut 20%. Savings of $1.9 billion
- $7.0 billion (+1.4%) – National Science Foundation
Increase 10%. Cost of $700 million
- $5.1 billion (−3.8%) – Corps of Engineers
- $5.0 billion (+100%) – National Infrastructure Bank
Eliminate. Savings of $5 billion
- $1.1 billion (+22.2%) – Corporation for National and Community Service
Eliminate. Savings of $1.1 billion
- $0.7 billion (0.0%) – Small Business Administration
- $0.6 billion (−14.3%) – General Services Administration
- $19.8 billion (+3.7%) – Other Agencies
- $105 billion – Other
Cut by 50%. It’s OTHER. Savings $53 billion.
So, how did I do? I cut $883.7 billion from the budget. That’s still not enough. And the 2011 budget adds another $400 billion in spending.
I want our government to spend 95% of taxes, putting 5% towards debt paydown. I still have to add another $600 billion to reach such a fiscal position. Can this be done? Have we dug a trench so deep with welfare that we cannot get out of it without people going nuts? Have we created a country of non-producers? Best that we do 2 things at the same time. Balance the budget (or spend slightly lower than expenditure) and implement a tax system that encourages inward investment in business. The FairTax would be ideal.