As the fall elections approach, two factions within the congressional GOP have emerged. The first faction, which generally controls the Republican leadership, is short-term oriented and just wants to return the GOP to power in Congress. Riding the wave of voter discontent over the government’s finances is a means to an end – the end being power.
Amtrak has announced that it will spend $300 million on 130 new rail cars, including sleeper and dining cars, for its long-distance trains. The government company’s announcement came with the obligatory statement that the purchase will create 575 jobs. That’s more than $500,000 per job.
The city of Bell, CA recently made national headlines when it came to light that city officials have been receiving massive six-figure salaries. Bell taxpayers were so irate that police in riot gear were required to maintain control at a recent city council meeting.
According to the administration’s latest budget figures, the federal government is projected to run huge annual deficits throughout the coming decade. The actual figures could end up being considerably larger, particularly if policymakers continue to justify additional budget-busting for alleged “emergencies.” As a previous blog shows, these deficits would be driven by excessive spending.
The figure shows projected federal spending and revenues in coming years, according to the administration’s new budget figures. The deficit is the gap between the lines:
Federal spending reached $1 trillion in fiscal year 1987. Then it took fifteen years for spending to reach $2 trillion in 2002. Then it only took six years to reach $3 trillion in 2008. President Obama’s new midsession budget projections show that it will reach $4 trillion in 2014 and take only four more years to top $5 trillion in 2018. Meanwhile, the Washington establishment is getting all worked up about the deficit effects of extending recent tax cuts, which amount to just a few hundred billion dollars a year.
Greece’s fiscal meltdown could be a sign of things to come in the U.S. if we don’t get our own fiscal house in order. The images of Greek unions rioting against desperately needed government reforms bring to mind our own problems with public sector unions.
Voters who recognize the need to make major cuts to federal spending and think returning Republicans to power will accomplish this feat could be in for a big disappointment. Recent comments to the Washington Post made by former Senate majority leader Trent Lott (R-MS) make it clear that anti-spending candidates elected in November will be fighting against their own party – not just the Democrats.
The following chart show federal spending over the past decade on a per-household basis, adjusted for inflation:
The economy remains weak and the administration’s stimulus has been a bust. To counter the growing unpopularity of his economic policies, the president is traveling around the country handing out government checks to anointed industries.