Thursday, March 14, 2013

Budgets

     It's budget time everyone so get ready and gear up for more stalemates and conflict.  House Budget Committee Chairman Paul Ryan (R-WI) released his new budget proposal entitled The Path to Prosperity while a day later Senator Patty Murray (D-WA) released her own.  Each has its flaws but Ryan's seemed to make more noise and get more attention in the national limelight than his counter point.
     Each budget was what anyone would expect it to be.  For Democrats, it's tax increases to pay for entitlements and social welfare, while the Republican budget provides tax breaks for the wealthy and boosts our defense program.  While Murray's plan spends more over the course of 10 years, Ryan's budget virtually phases out the poor and elderly.   
     In Ryan's proposal, he is going to balance the national budget in ten years.  This is something that he has been narrowly focused on for some time now.  In the global scheme of things, many other nations do not balance their budgets and economists are commenting that balancing our budget is an unnecessary enterprise.
         Ryan's plan is very vague and it does not provide any answers to revenue in return for tax breaks to millionaires.  He continues with the Republican's crusade to deregulate, citing crippling sanctions by the EPA which are harmful to corporations and in turn job growth.
     Mr. Ryan, along with the rest of his caucus, would also like to repeal ObamaCare.  I do not understand why they feel that turning Medicare into a voucher program and investing in the private insurance market is a better, and a safer alternative for that matter, than ObamaCare.  George Bush wanted to put Social Security into the highly volatile stock market which would have had disastrous consequences.  Yes, Medicare and Social Security need to be overhauled.  Is the answer Chained CPI?  That is a difficult question to answer.  Some, such as Republican strategist Mike Murphy, believe it is but it may only delay the inevitability of depleted funds while making payments to those who collect less.  Chained CPI seems to be a short hand answer but our legislators need to find a more long term solution.  By privatizing the health care market, our government would be subjecting Americans to be at the whims of private for-profit insurance companies who can drop someone in an instant for things such as pre-existing conditions.
     Ryan also addresses our severe "spending problem" in the country.  Republicans are still touting the idea that the President is the out of control spending monster contributing to our national debt.  The fact is that our deficit has shrunk under Obama and our economy has actually grown despite what Republicans in congress may say.  Ryan wants spending caps on our federal agencies to help remedy this problem.  This is another tactic to be more sympathetic to the big businesses in which these agencies help to regulate.
     Defense spending is also a touchy subject.  Ryan wants to give the department of defense $554 billion to ensure that we remain a dominant world power.  He notes that the United States is a declining world power and that we need to give our military the funds to keep us safe.  He is using National Security as an excuse to give the military money for which they are not even asking.  What many do not understand is that our military is still second to none.  We have also wasted billions of dollars on state of the art aircraft which have not even seen combat.  One of the biggest problems in our way of thinking is that we are so afraid of becoming inferior to our enemies we try to (and greatly succeed) at outspending other nations on military.  While the sequester's budget cuts to military are a major problem, I do not think that we need to allocate this type of money.
     Rather than giving billions and billions of funds to the military, giving tax breaks to the ultra wealthy, and trying to balance the budget, we should be trying to continue our progress at cutting the deficit and growing our economy.  Our economy has soared in the past when money has been pumped through it.  Some still believe that the Fed's choice to continue to place money into the stock market is just providing false numbers and once that stops we will be put back in the same place we were before.  Be that as it may, the stock market has seen great prosperity recently and investors are buying.  The jobless numbers from last month (February) were much better than expected however the sequester is going to inflict more wounds on it.  I know that this is not what most Americans want to hear, but higher taxes are the best way to build revenue and tax breaks for millionaires with no answer on additional revenues is not the way to "prosperity."  We could always go back and adopt a protectionist society by raising tariffs on goods outside the country but no one wants to walk down that avenue.  By closing military bases around the world that we no longer use, we can really make up on revenue and invest it back into the economy.  The draw down in Afghanistan is a start, but we cannot continue to get involved in these global military conflicts.  Politicians such as John McCain are so quick to jump to military action despite having no way to pay for it.  Isolationism is not really an option for the United States in today's global market but there is a fair balance between isolationism and being the world's police.
      While each budget proposal is flawed and may not be the answer to our problems, we must continue to invest in our economy.  This is where we can be prosperous in the future and build a stronger nation. 

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