How Much Should We Be Taxed?
The current Presidential debate is looking closely at Mr. Obama’s stated intent to raise taxes on “the rich” to fund new and better programs (see http://www.barackobama.com/pdf/taxes/Factsheet_Tax_Plan_FINAL.pdf ) and Mr. McCain’s position that we should cut taxes, especially for businesses (see http://www.johnmccain.com/Informing/Issues/1a8640f0-b2e3-4edb-b2a9-236df79d2579.htm )
Unfortunately, both candidates have it wrong. The question is not how much to raise or lower taxes so much as it should be, “How Much Should We Cut Expenditures?”
In the past few months as our economy has slowed and many of us have faced the economic reality of higher prices (gas, food, etc.) most of us have looked first at where we can save money. Where can we cut our expenditures? Since none of us has access to the Treasury’s printing presses, we rarely think first, “How can I increase revenue?” Congress needs to act the same way: Cut expenditures first, then look at revenues.
We have created a Congress that now has no incentive to cut costs anywhere but with huge incentives to increase programs everywhere. This needs to Change.
“A democracy cannot exist as a permanent form of government. It can only exist until the voters discover that they can vote themselves largesse from the public treasury. From that moment on, the majority always votes for the candidates promising the most benefits from the public treasury with the result that a democracy always collapses over loose fiscal policy, always followed by a dictatorship. The average age of the world’s greatest civilizations has been 200 years. These nations have progressed through this sequence: ‘From bondage to spiritual faith; From spiritual faith to great courage; From courage to liberty; From liberty to abundance; From abundance to selfishness; From selfishness to apathy; From apathy to dependence; From dependence back into bondage.’” - Alexander Fraser Tytler Lord Woodhouselee (1748-1813)
Please send me your suggestions as to how to give incentives to Congress to reduce government spending.
For example:
All Congressmen and women and all Senators will be bound to the same rules they make for the Military. That means they will have the same medical benefits, the same retirement program, the same drug testing, the same security clearances, etc. Only the laws under which they would perform their duties would be different. I would make them subject to the laws they create for all of us, not to the military justice system. I would also pay them five times the pay of a Colonel in the Army, Navy (Captain) or Air Force with time in grade allowances. If we don’t pay them enough, they may resort to taking money from those who would influence their votes (parish the thought).
Okay. That’s a start. Got any thoughts?
8 comments
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September 25, 2008 at 3:49 pm
JB
You cannot expect the current batch of miscreants to change….the citizens must:
Replace existing representatives with folks that pledge to allow the Federal government to perform only those tasks the founders envisioned the Feds should do(defend the homeland, print money, defend the constitution…);
Replace existing representatives with folks that pledge to allow the State (County, City) governments to perform only those tasks that the citizens of each State (County, City) determine cannot be performed by the individual;
Return to indiviual responsibility, initiative and resourcefulness;
And take back the education of children from the government so that this country can have an informed electorate.
September 25, 2008 at 4:33 pm
ttoes
Thanks, JB.
You’ve reminded me of a couple more posts I want to do: One on the valid activities of our Government and one on our “public education system.”
I haven’t convinced myself that I really like the title to this new blog but clearly, like you, I think that responsibility has been the missing ingredient in our representative form of government. You have put it better than I by adding individual initiative and resourcefulness.
September 26, 2008 at 4:57 pm
William Coomber
The defense budget for 2009 amounts to over 880 billion dollars. This is a 74% increase over 2008, but each year for several years we have been paying billions for defense. A smattering of individual items is included below.
After you notice the Defense budget, a possible way to cut expenses becomes obvious … just cut back on a few cruise missles and attack bombers.
By the way, these data come from GPO Access (www.gpoaccess.gov) which you should peruse, and which is a service of the U.S. Government Printing Office that provides free electronic access to a wealth of important information products produced by the Federal Government. The information provided on the site is the official, published version and the information retrieved from GPO Access can be used without restriction, unless specifically noted. This free service is funded by the Federal Depository Library Program and has grown out of Public Law 103-40, known as the Government Printing Office Electronic Information Enhancement Act of 1993.
Items:
$515.4 billion for the Department of Defense’s base budget.
$70.0 billion as an emergency allowance to support the GlobalWar on Terror
$20.5 billion to increase the size of the Active Army and the Marine Corps
$159.7 billion to support daily operational needs of the Department,
$5.7 billion for the United States Special Operations Command
$49.1 billion to recruit, train, equip, and sustain National Guard and Reserve units
$389 million to establish a new command to strengthen ties with African governments, institutions,
and organizations
$750 million to support allies.
$17.3 billion to continue modernization of the tactical aircraft fleets
$7.5 billion to provide survivable tactical vehicles and vehicle armor.
$12.7 billion to continue procurement of transformational warships
$1.8 billion to continue development and procurement of major unmanned aerial vehicles
$496 million to combat improvised explosive devices
$10.7 billion in investment funds to build a space-based capability
$10.4 billion to to develop,missile defense systems
$300 million to improve the security of U.S. networks
September 26, 2008 at 9:46 pm
ttoes
Thanks, William.
Appreciate the information and the lead on Public Law 103-40.
One major question comes to mind. First, a 74% increase boggles the mind. The numbers I see from the OMB show the same $515.4 billion that you show in your comment as the base budget for 2009. They show $481.4 billion for 2008 base budget. My math says that is a 7% increase. It looks like you chose to use the base budget for your 2008 number and added the everything related that you could find for your number for 2009. If this is not the case then you just have the number wrong. Actually, it looks like it is wrong by a factor of ten: 74% you state versus a year to year 7% on the actual budgets. I can only imagine that you made the mistake because the incorrect numbers supported what you set out to find, or you are inflating numbers to make your argument sound better. If I am overreacting to your mistake, I apologize. If you used numbers in a deceptive way to make a point, you should apologize.
Having said that, I agree wholeheartedly that we need to cut a great deal from the DoD budget. The way they purchase goods and services probably adds a very large sum to the budget. As a manufacturer who has tried to sell to the government, I often think the weight of the paper is greater than the weight of the steel product we manufacture. A close examination of the Dod budget is a must if we are to make an honest effort to cut government spending. There should be no sacred cows.
Thanks for the comment,
Tom
September 26, 2008 at 10:39 pm
William Coomber
Thank you for pointing out my error. My faulty comparison indeed boggles the mind. I should have said it was 74% increase over 2001, not 2008 … and I do apologize.
September 27, 2008 at 7:27 am
ttoes
2001 makes much more sense. I appreciate your apology. I still think it all comes down to the fact that we agree that one of the first things we need to do is to look at the big numbers first as we start to trim government spending. The DoD has plenty of room to cut back in my humble opinion but there is lots more including many of the transfer payments.
thanks,
Tom
September 27, 2008 at 5:10 pm
William Coomber
What do you mean by “transfer payments?”
September 27, 2008 at 9:05 pm
ttoes
Good Question, William. In my opinion, government spending is divided into three categories: goods, services, and transfer payments. Goods and Services, I think, are self explanatory. Transfer payments are government expenditures for which no goods or services are obtained. For example, and the type of transfer payment I would look at very closely, money paid to someone to subsidize rent or money spent to help people with the cost of their food (food stamps) or money sent to a farmer to not plant rice, etc. To me, these are the transfer of tax dollars to people who have done nothing to earn the money nor anything that will benefit the government or the taxpayers who support it. In my opinion, transfer payments are the basic ingredient for socialism.