The next president will confront a range of fiscal crises that the current president has ignored. One of them is the ongoing implosion of the U.S. Postal Service (USPS). With the rise of email, the volume of snail mail has plunged, and the USPS has lost more than $50 billion since 2007. The red ink will continue to gush as more bill paying, advertising, invitations, and other communications go online.
The federal government spends about $30 billion a year on the war on drugs. Much of the spending is wasteful and counterproductive. This week, for example, an auditor’s report revealed how the drug bureaucracy flushed $86 million down the drain on an anti-drug aircraft that was never used.
Watching Pete Townshend wailing on his Fender Stratocaster last night at the Verizon Center reminded of what I’d read about Fender’s history. Part of the Fender story regards how the firm got hammered by Japanese competition in the 1970s, but then bounced back by refocusing on quality. So while I was listening to “Won’t Get Fooled Again,” I’m embarrassed to say I was pondering Donald Trump’s misguided statements favoring protectionism.
At this stage, it’s quite likely that Donald Trump will be the Republican presidential nominee. Conventional wisdom suggests that this means Democrats will win in November. On the other hand, conventional wisdom also told us that Trump would never get this far. So it’s unclear what will happen in the general election, particularly given the ethical cloud surrounding the presumptive Democratic nominee.
The Department of Health and Human Services (HHS) is America’s first $1 trillion bureaucracy. HHS will spend $1.1 trillion in 2016, which is one $1 million repeated one million times.
You are paying for it, so you might want to know that:
In the Republican debate last night, CNN’s Dana Bash pressed the candidates on how they would deal with Social Security. Senators Marco Rubio and Ted Cruz gave solid answers, explaining that the system was headed toward insolvency, suggesting ways to slow spending growth, and scolding candidates who denied the need for cost-saving reforms.
In recent weeks, the bureaucrats at both the International Monetary Fund and the Organization for Economic Cooperation and Development have recommended that politicians should have a green light to supposedly stimulate growth by increasing the burden of government spending.
The U.S. is bankrupt. Of course, Uncle Sam has the power to tax. But at some point even Washington might not be able to squeeze enough cash out of the American people to pay its bills.
President Obama has issued his final federal budget, which includes his proposed spending for 2017. With this data, we can compare spending growth over eight years under Obama to spending growth under past presidents.
Figures 1 and 2 show annual average real (inflation-adjusted) spending growth during presidential terms back to Eisenhower. The data comes from Table 6.1 here, but I made two adjustments, as discussed below.