Principles of Reform
The federal government operates the air traffic control (ATC) system as an old-fashioned bureaucracy, even though ATC is a high-tech business. It’s as if the government took over Apple Computer and tried to design breakthrough products. The government would surely screw it up, which is the situation today with ATC run by the Federal Aviation Administration (FAA).
While the Obama administration has focused on tax increases over the years, Canada has focused on tax cuts. The new Canadian budget, out a couple weeks ago, summarized some of the progress that they have made.
A Wall Street Journal story today looks at government spending through the lens of the national income and product accounts (NIPA). The article says that as government spending rises, it is “no longer dragging on growth.” Unlike recent years when spending was supposedly cut, the government today “has ceased to be a drag on growth.” But that is an unwarranted conclusion from the NIPA data, which are produced by the Bureau of Economic Analysis (BEA).
The Government Accountability Office (GAO) releases an annual report on government duplication, fragmentation, and overlap. Since 2011 GAO has highlighted 440 different actions that Congress and the president could take to reduce this wasteful spending. This week, GAO released its updated report and included an additional 66 actions.
Today is Tax Day. Federal tax returns are due to the Internal Revenue Service with a postmark before midnight. The Congressional Budget Office (CBO) projects that the federal government will collect $3.2 trillion in revenue this year.
A lot of people hate Tax Day. Filling out tax forms is drudgery, and being forced to pay cash to the IRS is painful, especially since the taxes fund so many wasteful activities. Taxes are not the price of a civilized society as liberals claim, but the price of a government cluttered with failed and harmful programs.
Presidential candidate Rand Paul has announced his support for a balanced-budget amendment (BBA) to the U.S. Constitution. This is an old idea, but a good idea. A BBA has been proposed in Congress as far back as 1936. In 1982 the Senate passed a BBA by a vote of 69-31, but it failed to get the needed two-thirds approval in the House. In 1995 a BBA passed the House by a 300-132 margin, but it fell one vote short of passage in the Senate.
Senate Budget Chairman Mike Enzi released his budget proposal yesterday afternoon. The request follows yesterday’s proposal from House Budget Chairman Tom Price. The two requests are similar. Both would reduce projected spending by $5 trillion and balance the federal budget over the next ten years. Both budgets repeal ObamaCare, and neither includes reforms to Social Security. The big difference between the two is that the Senate version is even vaguer than the House version.
The financial press has become inundated with the word “austerity.” Since Greece’s left-wing Syriza proclaimed an “anti-austerity revolution,” strong adjectives, like “incredibly savage,” precede that overused word.
ObamaCare gives states the option to expand Medicaid to cover all individuals below 138 percent of the federal poverty level, which is approximately $33,500 a year for a family of four. To encourage states to expand, the federal government agreed to fund 100 percent of expenditures for the newly-eligible participants until 2016, and then slowly decrease the match to 90 percent in 2020 and into the future.