Realistic Budget Cuts

Realistic Budget Cuts was Originally Posted on October 14, 2013 by lavarock

I na  forum, I answered the request for realistic budget cuts this way. Note that I don’t know where we need to cut first, rather I suggested some simple things and ways to start looking at spending to make it more efficient.

First, you look at expenses and see where you spend the money. You then look to see where you have the most waste and address that problem first.

When I worked performing computer security, some reports listed thousands of errors, and the fix was to secure one group of files that caused all the errors. It seems obvious to attack the most complex and wasteful item, make it leaner and less prone to waste or fraud. You look to SAVE money, rather than ask for more.

I am not going to investigate all of the government spending and suggest fixes, I’ll leave that up to the financial experts. However, some simple ideas come to mind. Note that these may not save a lot of money, but are examples of how you begin to look at waste.

A pet peeve of mine is the IRS. My personal thinking is that tax laws are WAY too complex. They are that way because when you start forcing people to pay the government, politicians have found that they can get votes from the public and help from the other party, by offering a reduction in what some people or groups are taxed. These exceptions (deductions) make things a lot more complex. Complexity causes confusion and irritation among taxpayers. They have to buy software and pay people to figure out how much they owe. Then the IRS has to hire people to verify and audit returns to see if people are cheating by not paying certain money that other groups have been exempted from paying. Then there are tax lawyers who litigate whether a particular person should have paid or not. Also there are enforcement people and lax levies and home and business forfeitures and tax sales of properties and bank account garnishments and so on.

I believe that a system closer to sales tax solves much of this waste of manpower and complexity. Yes, there may have to be an exemption or two, but nothing like we have. When you rely upon people to report income (and they hide it) it requires more work to follow the money. A point of sales system seems to be easier, since it is harder to hide.

The above describes a way to make a complex agency less complex. Fees and processes which have less exceptions are easier to manage and more efficient.

The military. I think we do need a strong military (especially if you default on your obligations to other countries). As with any organization, there is waste in the military. There are well documented reports of horrible spending in the past (Congress throwing good money after bad in procurements), military specs and requests that create items far more expensive then they need be.

I think many of these problems have already started to be addressed, but make an all out effort to make the procurement easier, less prone to fraud.

Continue to sell off old government-owned property and buildings which could be used more efficiently by the states or businesses.

I have been told that a proper society funds the arts. I used to go to the Smithsonian Museums often as a kid. The Smithsonian is a  I would have gladly paid their admission fee if there was one. However, my neighbors might not have cared about any kind of museum. Should they be required to pay for something they have no interest in? (The Smithsonian is government administered). There are those who say we MUST preserve the past. That would be true if by preserving the past we actually learned lessons from it and did not continue to make the same mistakes.

Change the Social Security system and force people to invest their money in our country and businesses. By taking SS moneys and placing them in the general fund, allows politicians to shuffle it around. There is no real drawer with your money in it destined for your retirement, only an accounting and a promise to pay you. If you are paying in all your life and they are investing your money, there should be no reason why, after 30 or 40 years they tell you that there is less chance that you will get that money. IF you are required to save for your future (and I don’t know if that is a function of government) but if you are required to fund your own retirement, than force people to invest. Yes there is a possibility that some people will not make wise choices, but they could be required to put a certain percentage in bonds or other safe and secure items. They could invest the rest at a more aggressive rate if they wanted, but there would still be that “nest egg” that would pay for some of their care.

Encourage people to start their own businesses and don’t make it so hard. Encourage more people to convert to solar electricity. Encourage more people to use less resources.

Many people are living under covenants which keep them from putting up clothes lines, thus they use a lot more energy to dry things. While not a great increase in electrical usage, it is just one of the many small things that begin to add up. Encouraging builders to orient houses to take advantage of prevailing winds, designing houses to take advantage of sunlight to warm in the winder and cool in the summer. Reducing water usage for landscaping.

Ever notice that trees are planted in the right-of-ways under electrical wires and telephone cables. Then people are hired to come trim the trees so they don’t pull down the wires. If the trees don’t get trimmed often (like during lean financial times) the trees grow into the wires and a storm brings them down, causing electrical and service outages which the companies then send out crews to fix. They may also have to rebate back to consumers for loss of foodor services. Wouldn’t that whole process be a bit easier if the wires were underground or no trees under the wires?

We come up with a problem and then try to patch it with costly solutions rather than attack the problem. If you spend more than you have, cut costs, don’t increase your limit.

The public needs to vote in more people with financial and business skills than lawyers. Ever watch a trial? The defense attorney may know that his client is guilty, but tells the jury he is not and finds all sorts of ways to deflect their attention from that fact. Of course that is his job, to fins a loophole in the system.

To lose weight, you might reduce intake, eat better foods or exercise more. Doing all three helps quite a bit.

The US economy has been likened to a family with credit cards who continue to spend more than they make and keep requesting a credit card spending limit increase. You know that is fraught with failure and just pushes the problem out to other generations. Politicians don’t want to address the problem because their main goal is to get re-elected. That is because they think they can solve the problem only as long as they are there in office. Also, what politician wants to tell the public that he voted for a bill that taxed everyone harder, only because some special interest group promised to vote for him.

So we keep increasing the spending limit and collecting more taxes. Keep in mind that the big bubble of citizens is now shrinking and there are less people to tax than before. As the taxpayer start moving into retirement, they stop paying taxes on income. The debt rests on the fewer wage earners we have, while politicians try to find ways to tax the remaining people more.

I don’t pretend to have many answers about the economy and the best way to cut costs. All I can do is suggest ways to think about problems and try to find a more cost-effective way to address them.