Federal debt is piling up and spending is expected to soar in coming years. Projections show rivers of red ink unless federal policymakers enact reforms. They should cut spending in every department. A great place to start would be cutting aid-to-state programs, which cost more than $600 billion a year.
I testified to the House Budget Committee yesterday on the history of federal debt and reasons to balance the budget. John Taylor, Jared Bernstein, and Ryan Silvey also testified.
Environmentalists often assume that free markets work against their goals. But the market is the best friend of the natural world because it generates constant pressure to innovate, to cut costs, and to use resources efficiently. The price system prompts consumers and businesses to minimize consumption of dwindling resources. To ease California’s water problems, for example, we need markets not regulatory controls.
The Transportation Security Administration (TSA) has another failure on its hands. In recent tests, undercover investigators smuggled mock explosives and banned weapons through U.S. airport checkpoints 96 percent of the time. According to ABC, “In one case, agents failed to detect a fake explosive taped to an agent’s back, even after performing a pat down that was prompted after the agent set off the magnetometer alarm.”
It has been 800 years since English barons negotiated a written peace agreement with King John. The original June 1215 agreement was revised and reissued numerous times, with the 1217 version gaining the title Magna Carta (“Great Charter”). Over the centuries, the document has had a powerful influence of the evolving British legal system and government.
I’ve argued that the centralization of government spending in Washington over the past century has severely undermined good governance. Citizens get worse outcomes when funding and decisionmaking for education, infrastructure, and other things are made by the central government rather than state and local governments and the private sector. The problem is the same in the European Union, as a new article in Bloomberg on the funding of Polish airports illustrates:
Across my desk this morning: James Bennett’s new book, Corporate Welfare: Crony Capitalism That Enriches the Rich.
The Senate Commerce Committee held a fascinating hearing on Wednesday regarding air traffic control (ATC). The hearing showcased the momentum to proceed with ATC restructuring. Because aviation is crucial to the economy, such a reform would create wide-ranging benefits.
On large and complex government projects, costs will double from the original estimates. This tendency is called Edwards’ Law of Cost Doubling.The Wall Street Journal reports on the PATH rail station at the World Trade Center. Edwards’ Law was in effect:
Congress has created an ongoing crisis in the Highway Trust Fund (HTF). Year after year, policymakers spend more on highway and transit aid to the states than the HTF raises from gas taxes and other dedicated revenues. CBO projects that annual HTF spending will be $53 billion and rising in coming years, while HTF revenues will be $40 billion. That leaves an annual funding gap of at least $13 billion.