Sunday, December 05, 2010

Achieving a balanced budget

This is a follow up to the last post.  We now know that the Deficit Commission was unable to achieve 14 votes to get the Senate to consider its proposals.  On Facebook recently, I have engaged in a lot of banter about whether the Bush era tax cuts should be extended.  That is not the point.  A balanced budget is possible at many levels.  But based on the last election and also some enduring principles, most Americans have rejected in rather strong terms the huge increase in governmental activity - both in the Obama administration but also in more generalized polling.

For the past 30 years we've been able to raise about 18-20% of the GDP to fund the things we have wanted to do in the governmental sector at the federal level.   But a lot of the Washington elites think that percentage should be larger.  It is clear that many in the current administration think we should raise the amount of dough we spend through the feds to something approaching 30%.  

But an alternative way to look, which seems to coincide with the voters, is to decrease the role of government.  Not in the way that most bureaucrats would do it by huge and pro rata cuts in all spending but by making more reasoned choices about what we think we should do using tax dollars.   There are tiny examples - I think, for example, that public radio should not be burdened with governmental support.  Eliminating the CPB and NPR would make no dent in the budget but it would say something about our priorities.   I'd also work to eliminate a lot of the funding for the Smithsonian - a fine institution but prone to bouts of political correctness.  If we want a national museum then let those who want it to be there help fund it - partially with admission fees and partially through fund raising.   While we are at it - why should the Transportation Security Administration have government employees?  If airport security is important why not set the standards and then let the airlines and air travelers figure out how to meet the standards.   All of those potential cuts come from a philosophical approach which starts with a premise that government is not very good at doing things.   I am sure if we started with that debate (what should government do?) we could achieve a balanced budget because then the discussion would be about the appropriate balance not whether millionaires should pay more taxes or the unemployed should be covered with benefits for more than two years.

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