Media attention on the federal budget usually focuses on contentious issues, such as the debt limit, food stamp cuts, and Republican cave-ins. But let’s look at the big picture: What does the government spend almost $4 trillion of our money on each year?
Canada released a new federal budget yesterday. The ruling Conservatives are centrists and far too supportive of the welfare state. Nonetheless, the government is expected to balance the budget next year while steadily reducing spending and debt as a share of GDP.
Here is a rule of thumb to remember when you hear about a proposed government project: If a politician says that it will cost $1, it will end up costing $2 or more. Call it Edwards’ Law.
The Washington Post reports that President Obama is cheerleading for more spending on high-speed Internet, tablet computers, and Wi-Fi in the nation’s K-12 schools. There are budget and federalism reasons why the president of the United States should not be sticking his nose into local schooling activities, but let’s put those concerns aside here.
The CBO released its new budget outlook today. The chart below shows total federal spending since 2000. Spending was way up under Bush and the first two years of Obama, and roughly flat since then.
Under cover of SOTU media coverage, Congress is set to sneak through the first big farm bill since 2008. The Congressional Budget Office released its estimate of the bill’s cost: $956 billion over 2014-2023. It would thus mean almost $1 trillion more borrowed from U.S. and foreign creditors, adding more weight to the anchor pulling down the living standards of our children and grandchildren.
From the Wall Street Journal, here’s the latest evidence on quality and efficiency in government infrastructure spending
New leadership is coming to the congressional tax-writing committees. Ron Wyden will be taking the helm of Senate Finance and Paul Ryan will be likely taking the helm of Ways and Means. This is good news, as both gentlemen are serious legislators and very interested in major tax reform.
Congress is gearing up to pass the first big farm bill since 2008. The logrolling between farm interests is nearing completion, the Republicans have given up on making substantial food stamp cuts, and the Treasury stands ready to borrow another $1 trillion. We are all set to go.
Both the economy and the environment are complex ecosystems. Governments often upset the natural balance and cause damage because they combine limited understanding with an excessive zeal to mandate and subsidize.