I know of very few people in America today who would disagree with the statement that America is heading for a mountain cliff heedless of the dangers which will await us once we plunge over it. While people of differing ideologies might not agree about the various factors which are pushing us farther and farther into danger, I think that one thing that can be agreed upon by all factions is that our national budgets / spending are out of control and is one of the contributing factors. There are two basic topics which I want to discuss with this article. One is about some factors which I think compound the problems and combine to make our nation fiscally unsustainable. The other is a call to action and sacrifice by my own generation.
Have you ever wondered how one politician can claim that government spending has been reduced while another politician can claim that government spending has been increased and, yet, they can both be telling us the “truth” while our financial problems continue to get worse and worse with each passing year? Well, we can thank the idea of “baseline budgeting” for making such political contortionism possible. Baseline budgeting is the concept that, for a new budget year, you will draw a line at specific totals of spending from the previous budget (the baseline) and you then incrementally increase spending above that baseline. Thus, one politician can say that spending has been cut if the amount of money that will be allocated above the baseline is less than what might otherwise be allocated while the other can say that spending has increased because the current budget is higher than the previous one. In neither case, however, has the issue of the already bloated budget mess been addressed.
On the opposite end of the possible budgeting methods is “zero-based budgeting”. Zero-based budgeting is the process of building a brand new budget from the ground up each and every year. As stated in the Small Business Accounting Guide, “(ZBB) is a method of budgeting which requires you to justify all planned expenditures for each of your new business period[s]. It defers [sic] from traditional incremental methods which may only require you to explain the amounts you need in excess of the previous period’s funding.” (http://www.small-business-accounting-guide.com/zero-based-budgeting.html)
Baseline budgeting is easier for politicians who either can’t be bothered to spend the time necessary to actually create an annual budget from the ground up or who don’t want to cut pet projects and excess pork that benefits their own constituents (and thus, their chances of getting re-elected). Baseline budgeting also increases the likelihood that expenditures will be made annually that no one is actually aware of. To make a baseline budget sustainable over a period of years or even generations, you must have an infinite and ever increasing source of money and resources. Without such an infinite or growing pool of resources, taxes must be continually raised and new sources of taxation must be found, otherwise you have a system which continually increasingly overextends itself. Eventually, the golden goose (the taxpayers and revenue sources) die, leave or rebel because they have no more to give.
If you want to see a demonstration of why continuous baseline budgeting without a sufficient resource pool to draw from creates an unsustainable economy try this, get some Legos® and attach one block to a Lego base. So far, so good, it is solidly grounded. Now, what you do from there is to continue adding new Legos to the stack (not the base, the stack) you have started EXCEPT that, instead of placing new Legos completely over the ones already there, you add each subsequent Lego one step off from the one below. This creates a stair-like effect. The problem is that, without addition support from its base, you eventually reach a point where the weight on the topmost and farthest point of the stack is too great to be supported by the base and the end topples over. When it does collapse though, the top block is not the only one that falls off. Because of the connectivity of the blocks to the ones above and below them, most of the stack will collapse. THAT is the end result of continuous baseline budgeting.
Another way to look at it is that our government is a drug addict and the drug which they need to get high is tax dollars. As with any long-term and strung out junkie, the amount of drugs needed to give them their fix increases. Junkies do not make wise choices. The will ignore food, hygiene, love, any and everything which does not contribute to their high. They will also beg, borrow and steal money from anywhere that they can in order to buy them their drugs because they can’t make rational decisions. Eventually, those who have willingly or unwillingly financed their habit want their money back. If you don’t see where this is going, try watching the movie Less Than Zero and imagine that the character played by Robert Downey, Jr. is our government.
Things would be bad enough if baseline budgeting was the ONLY budgeting problem that our government has. Unfortunately for us (the taxpayers) there are quite a few other flaws in the system. As a result, simply changing our budgeting method to a zero-base budgeting system (or to any one of several other possible ideas, such as program based budgeting) will not fix the problems with government expenditures.
Another of the problems (out of many) is that budgets are made based on PROJECTIONS of what Congress and the President THINK our national income will be for a given year. As a result, the actual amount of what is available is always wrong. If the projection is too high, then money will have to be “borrowed” to make a budget work. If the projection is too low then the excess money will STILL be used to fund SOMETHING. How this problem works is that taxes are due in April and usually by October, the government has a pretty good idea of what they actually have to spend. This is good because it coincides with America’s fiscal year. This is bad because what is being budgeted for is the fiscal year starting the NEXT October. While it would be painful to remedy this (and take several years), the time to present the next year’s budget can be moved back by two or three months each year until eventually budgets that are presented are based on what the real government income was (and which has been in “the bank”) since the PREVIOUS October. This, again, draws back to the analogy of the drug addict and trying to clean him up and wean him off of his drugs. Right now, we are theoretically spending money a year before we have it. We need to move things back until we are only allowed to spend what we have had in our hands since the previous October.
On another front, while in THEORY the budget is made up of a lot of individual budgets for all of the different budget areas, what is now the common practice is to make the process so continuous and time consuming that eventually Congress is forced by time limits to roll everything up into huge and monstrous constructs, so big that NO ONE can actually know what is contained within them, called omnibus budget bills. ( http://corporate.cq.com/wmspage.cfm?parm1=232) As a way to delay the “need” of passing of omnibus budget bills, Congress can, and does, pass what is called a “continuing resolution” or a CR. (http://www.thisnation.com/question/003.html) What a CR does is authorize the government to continue spending what it is already spending based on the lowest possible amount… the amount proposed by the Senate, the amount proposed by the House, or the actual expenditure. While holding spending at the lowest level asked for might, on the surface, sound good, it is usually a political ploy to either hurt programs not liked by some members of Congress or to continue funding a pet project that might otherwise be cut. This game is played out until the “clock” runs out and, viola, the only option available is to pass yet another omnibus package.
There are many more problems which simply screw the taxpayer each year, such as earmarks, pet projects, hidden budgets, etc. Did you know that Congress gets an AUTOMATIC pay raise every year unless it votes to specifically NOT give itself a pay raise in any particular year? Because of a law passed in 1989, Congress doesn’t have to do anything or pass anything to get their automatic raise each year. If they do NOTHING they get the raise. (http://usgovinfo.about.com/cs/agencies/a/raise4congress.htm) In addition, for a nation which was designed to have no permanent political class, elected office now comes with huge pensions and benefits. (http://money.cnn.com/2006/01/20/commentary/wastler/wastler/index.htm).
In addition, our legislatures operate under a sort of reverse-NIMBY (Not In My Back Yard) philosophy when it comes to spending taxpayer’s money. I say reverse because (unlike politicians doing whatever they can to keep anything potentially negative from happening in the locations that they represent, no matter how necessary they might be or how they might be the best solutions for our nation, as a whole), politicians will say that we need to reduce spending EXCEPT for the spending that benefits their districts or states. Hey, we have too many military bases; no problem, we will close some, EXCEPT for the ones in my district. Wow, that project is a huge sinkhole for money but the money goes to my constituents so, by God, I will fight tooth and nail to keep it funded. Everyone agrees that spending needs to be cut but no one is willing to cut spending that benefits them or their businesses, no matter how much sense it might make to stop that spending. We have become a nation of whores who will justify any and every atrocity as long as we personally make money off of it. Such spending is nothing more that wholesale bribery by our legislatures to us, the people, to buy our votes to keep our Senators and Representatives in their jobs. “Every government is a parliament of whores; the thing is, in a democracy, the whores are us.”(Anyone who is interested in how our government works, or doesn’t work, but has not read P. J. O’Rourke’s brilliant Parliament of Whores needs to read it as soon as they can.)
So, what are some of the actual ways in which our government budgeting process and its resulting need for ever larger amounts of revenue harm the people of America. Well, for one thing, if we go back to the drug addict analogy, our government is not just addict, it is also a powerful “crime lord”. For a nation born from a tax revolt, America has become one of the most, if not the most, greedy and oppressive nations in the world when it comes to collecting taxes, even to the extent of its belief that collecting American taxes justifies its right to bully other nations into cooperating with the IRS. The United States is unique in the world in its obsession with collecting taxes from any and every American living outside of the US. (http://www.ivdgl.org/pages/c-lifeevents/expatriation.html) (http://wapedia.mobi/en/Tax_evasion) (http://www.richw.org/dualcit/faq.html#discover)
Unfortunately, this standard only seems to apply to individuals who the government can beat up on. Large American corporations can, for all intents and purposes, buy their way out of being taxed, even when they “base” themselves outside of The United States, by simply giving politicians “great heaping wads of cash” or, to use O’Rourke’s phrase, “more money than you can shake a stick at AND the stick”. If individual citizens were to do this, they would be considered “tax evaders” and prosecuted wherever they might relocate to. America wants “its” money and it is damn well going to get it, even if it means hounding geriatrics into their graves.
So, how can our national and state budgets be fixed before everything collapses? First, some generation is going to have to accept that it is going to be screwed, either by cutting or losing their own benefits or by being left holding the hot potato when it blows up. I realized this many years ago, when my own grandparents were still alive and I, in my twenties, listened to my grandfather get very angry about anything being done or even talked about by the government which might lessen his own benefits without any concern for what kind of mess would be left behind. Now, I loved my grandfather, he still is one of my heroes, but, at that moment, all I could think was “You selfish bastard; what about your own grandkids?”
I realize that it is unconscionable to take away from people who have already entered their last years because they cannot rebuild their own lives. We cannot expect those generations to harm themselves like that. If sacrifices are going to be made, one of the younger generations will have to make them. Just as it is not reasonable to ask the dying generations to make such sacrifices, it is immoral to say to younger generations “I don’t care what happens to you or what you are left with. I’m going to get mine while I can and to Hell with anyone else.” (This, of course, is essentially the foundation of Ayn Rand’s objectivist “philosophy”.) This is where my call to action comes in. While this mess was created and worsened by the generations of our parents, grandparents and great-grandparents, if my own generation doesn’t simply suck it up and take the bullet, it will be the generations of our children and grandchildren and great-grandchildren who will be hurt, and even worse than we would be by taking the hit now.
My grandfather’s generation has been called “the greatest generation” because it fought and died to save the world from the Axis powers in WWII. How can any of us expect to beat what they did? What we can do is harm ourselves in order to make things better for the generations which follow us and, maybe, give them something to live up to. We can become “the NEXT greatest generation”. This is my call to my own generation; this is my call for us to be heroes to the generations that follow us. Let us make the painful choices now. Let us absorb the harm, the lessening of benefits, the belt tightening, the need to rely on others to personally help us because we won’t be getting the help from the government that many of us will need.
I would also ask my readers to keep in mind that not only is my monthly government disability check my own source of income; I have no children to either rely upon or to worry about leaving our messes to. I have every reason to keep things the way that they are now and no reason to worry about how any future generations might be harmed. I have nothing to gain in this and everything to lose, but, if it would help future generations, I would willingly give up what I personally get and need. Would any others from my generation agree to make the necessary sacrifices themselves? Can we be the ones who clean up the mess that has been left to us? Do we have to courage to make ourselves “the next greatest generation”?
Rhys M. Blavier
“Truth, Justice and Honor… but, above all, Honor”
© copyright 2010 by Rhys M. Blavier
Thank you for reading this article. Please read my other articles and let me know what you think. I am writing them not to preach or to hear myself think but to try to create dialogs, debates and discussions on the nature of our government and how we can build upon and improve it based on what we have seen and learned over the course of the 225 years of The American Experiment.