The Hush-Hush Reality of Federal Budgeting by Elise

In response to the recent (and ongoing and going and going…) federal budget deliberations in the White House, on Capitol Hill, and in Americans’ offices and living rooms, I’d like to elaborate on my two-part political philosophy:  1) the government is mismanaging tax dollars and failing to close the gap between America’s highest and lowest earners, and 2) U.S. wealth is not a nonrenewable resource.

According to USA Inc., a nonpartisan report that evaluates the financial health of the U.S. government as if it were a business, 58% of FY2010 expenses can be attributed to entitlement programs.  Fifty-eight percent.  The federal government took in approximately $2.2 trillion in revenue, spent about $3.5 trillion, and watched the unemployment rate exceed ten percent, even though President Obama promised that the post-stimulus jobless numbers would not make it into the double-digits.  Now take a look at the chart on page forty-six of the USA, Inc. report.  There has been an alarmingly steady increase in federal spending over the past five decades, particularly on education and health care (systems that are broken and bordering on unconstitutionality, respectively), but the government has little to show for it.  More Americans are at least partially financially dependent on the state, fewer Americans are paying taxes, income inequality is more noticeable, and current U.S. government budget deficit and debt figures are mildly terrifying.  There is a serious disconnect here.  Deficit spending during (and some would argue after) an economic recession has not worked, and it is not going to work.  How much more do federal and state governments have to spend before Americans start doing some simple math?  Progressives in Congress, the White House, and multiple governors’ mansions and state legislatures have been beating this dead horse for over a year now.  State initiatives to improve the social welfare by taking in tax dollars and spending rather haphazardly with little or no acknowledgement of failing programs and unintended consequences may be well-intentioned, but they certainly aren't working.  Keep raising taxes, the Democrats say.  We need more money to…do what with exactly?  Mismanage.  

The pragmatist in me is opposed to the attempted PAYGO system because it isn’t working.  The libertarian zealot in me says ‘no’ on principle.  Here, I want to address who gets taxed in the United States and why.  During the recent Bush tax cut extension debate in the lame duck session of the 111^th Congress, progressives argued that the ‘rich’ should be contributing more, that those individuals at the top of the income bracket don’t need the extra cash that the federal government could use for (what I have argued are failing) entitlement programs.  Nancy Pelosi, then House Majority Leader, led the left-wing pack.  This is ironic, and grossly hypocritical, because Minority Leader Pelosi is a multi-millionaire…who has never actually employed anyone.  Similarly, Senator John Kerry, who married the heiress to the Heinz Corporation, is taxed at an annual rate of approximately ten percent on his family’s inherited wealth.  The Kennedy politicians played the same card.  Who are these demonized ‘rich’ people making over $250,000 who may be forced to hand over 40% of their annual incomes to the federal government if the Democrats do well in the 2012 elections?  These Americans are, by and large, entrepreneurs and business owners.  They are subjected to an income, as opposed to a capital gains, tax rate and the highest corporate tax in the world.  These men and women are the innovators and the job-creators.  President Obama lauds small businesses, but he seeks to punish them when they succeed, when they employ.  Progressives in Washington want to give Americans a slice of the collective pie.  America’s entrepreneurs (who, by the way, added about 100,000 jobs in the month of March alone) are trying to make more pies, in spite of the state monkey hanging on their backs.

So what of the budget?  1) Government spending has been tried (excessively) and found ineffective.  So stop it.  2) American entrepreneurs must be allowed, no, encouraged to expand and employ, and U.S. businesses deserve a system in which they can compete effectively on a global playing field (i.e. something needs to be done about a growth-stifling corporate tax and the excessive, complicated, and disproportionately shouldered U.S. tax burden on the whole).  In the face of some inevitably angry voters, someone in Washington has got to touch entitlements.  Federal spending on social programs is not producing results, and slapping American business owners with unfair income taxes and an obscenely high corporate tax is counterproductive.  Limit the government, and, to reference an Obama 2010 midterm election campaign metaphor, give the keys to someone who won’t drive the car off a cliff…with a good chunk of American wealth tied up in the back seat.


Check out "The Path to Prosperity," the GOP federal budget plan released by Congressman Paul Ryan on April 5!

Hopscotch on the Highway: A Bipartisan Meeting in the Middle by Kira and Elise

Our society demands that we pick a side.  It is black or white.  It is right or left.  A dichotomy of choice.  The middle of the road is not an option.  In fact, the middle of the road is a dangerous place to stand.  You just might get hit by a semi.  If you do decide to cross you must look both ways to make sure you are completely safe and that there is little to no risk involved.  Until we are ready to stand together in the middle and play chicken with an 18-wheeler we are living on the shoulder, standing in dirt, and slinging the mud across the open highway at those equally as terrified to cross.  The purpose of this blog is to grab our chalk, not to draw lines down the middle, but to make a hopscotch grid and play in the middle of the highway.  We have very different views on many things.  One reason I think why we value each other’s friendship is that we both are willing to meet and discuss our differences- not to reach a consensus (That is insane on the face of it!) but to work a little harder to understand each other.  So c’mon.  Let’s get a little dangerous and go play in the road.  We might get hit by a bus, but hey, what’s life without a little risk.


Read, Reread, Challenge, and Understand.


Excited to share our thoughts and convictions with you and anxious to hear your responses,
Kira and Elise

The Liberal Lamentations of Kira:The Gluten-Free Bread of the Political Sandwich

In order to fully understand my views, I must first explain my roots.  I grew up in central Wisconsin where classmates of mine were late because they were “pulling tits” (No, not that! Milking cows- get your mind out of the gutter).  I was always a bit loud and often in the front of things.  My political affiliations began to emanate in grade school when I chanted “Smush Bush, More Gore” in a cafeteria full of awkward ten year olds and far conservative teachers.  Believe it or not, I actually had friends.  One, two, skip a few years and I am 18 and graduating from high school, packing my bags, and moving to Chicago to explore and challenge my adulthood, views, and beliefs.  Here I was a student of psychology, marketing, and the pedagogy of life.  My work in student life fostered a multitude of conversations that opened my eyes to other backgrounds, experiences, blessings, and hardships.  This all brought me to where I am today; living in Seattle with my nose in books and research as an industrial organizational psychology doctoral student (I/O Psych studies the world of work). 

Why do I tell you all of this?  Because each one of these experiences has a significant role to my views of politics, this crapshoot that we seem to be stuck in, and the mass amount of potential that exists from which to surge forth.  These challenging experiences, meaningful conversations, and my studies have led to a central thought – when we stop screaming our own beliefs at a volume that could drown out a Bono concert, we can hear whispering pleas for help.

The world is not the same as it was 50 years ago.  We are interconnected on a global scale and must adapt or fall behind.  Let’s make a metaphor out of this, shall we?  Imagine still using a television from 1949.  There are a total of three channels which are in an ever dull gray scale.  And forget about HD, the only way you get a clear picture is if your little brother stands on one foot, touches his nose with his right hand, holds his left arm at a 52 degree angle, and wears a hat made from tinfoil.  Meanwhile, you have a brand new flat screen sitting in its box and covered with dust no more than 5 feet from the entertaining circus going on in your family room.  Silly right?  Exactly my point!  Here we are with ability and availability to move forward.  We can increase the quality of life for American citizens through health care, benefits, fair wages and practices, civil rights, and environmental standards, yet we continue to stand on one foot and wear a tin foil hat, while ignoring the better option just five feet away.  It is time that we open up our eyes and take some responsibility for the hell that is around us and that we often just ignore.  Your neighbor is suffering from hunger.  Your coworker is afraid of losing their benefits and not being able to afford the medication for his wife’s cancer treatment.  Your daughter’s favorite teacher now needs to waitress on the weekend in order to make her rent payments on time.  We complain about our steak being overcooked while a Japanese family waits for their town to be declared an evacuation zone two weeks too late.

 

We must change.  We must adapt.  The potential is here to create massive change and improvements in our lives.  The answer is not Regan-onomics.  Don’t get me wrong, he was a fine actor and a pretty face on a postage stamp, but trickledown economics have about as much of a chance of working as I do of breaking down to “Footloose” with Kevin Bacon.  What is the answer then?  I believe it is through opportunities.  Not just opportunities for the haves, but also for the have-nots.  This includes opportunities in education through well-funded public schools, access to affordable healthcare, and   availability of community programs (e.g., job training).  By addressing the basic needs of our population we are able to build a sturdy base from the ground up.  Stability of the majority creates opportunities for growth, entrepreneurial enterprise, satisfied employees, and a more diverse and wider pool for the next leaders of this country.

   

This is where I will end my introduction.  I am a true liberal.  This does not mean that I sport a donkey tat and throw eggs at the Tea Party (however, I might think about one of those someday) but by true definition of liberal I believe equal rights and liberty.  I believe in moving forward and creating a system of government that provides the best care and practices for its citizens as well as the citizens of the world.  Let’s be what America stands for.  Let’s be a true land of opportunity for all- not just those who look like you, speak like you, believe like you, and write checks like you.  Stop shouting your own nonsense long enough to listen to a softer voice. 

Nutshell Politics of Elise: The Conservative Condiments in the Political Sandwich

Suzie was a conservative who moved away to college when she was 18.  By the end of her freshman year, she had decided that trickle-down economics wasn’t for her.

“This system isn't fair," she told her father that summer.  "Why not spread the wealth around?” 

Her father asked, “What grade did you receive in your history class this semester, Suzie?” 

“An 'A',” she replied.  “I have always been good at history.”

“What about those students in your class who aren’t so good at history?” asked Suzie’s father.  “I think, to make the distribution of grades more fair, your professor should have taken from your 'A' and given to those students who received lower grades than you.  Does that system still sound appealing to you?”

People occasionally peg me as a heartless conservative who votes with her wallet instead of her heart. The truth is, I just believe in limited government.  I believe, to my core, that if people are compelled to relinquish greater and greater percentages of their earned income to state and federal governments, things are not going to get any better.  Government is not the great equalizer.  Government is, and has proven itself to be, the great mismanager.  “Government exists to protect us from each other. Where government has gone beyond its limits is in deciding to protect us from ourselves.”  Americans are better equipped to handle their own money than the president and his government bureaucracy are.  How many American businesses and households are still floating despite over fourteen trillion dollars of debt?

Progressives argue that tax cuts should go only to the middle class, as the 'rich' don’t need or deserve them.  But who are the 'rich', really?  I think it is often the guy in the middle who gets hurt by the progressives in Congress and the White House pushing for higher income and corporate taxes for America’s high earners.  The Small Business Jobs and Credit Act of 2010 focused on helping entrepreneurs afford start-up costs by making it easier for them to get loans. On the other end of the business spectrum, the Wall Street Reform and Consumer Protection Act of 2009 was meant to address the risky behavior of America’s biggest bank executives.  The current administration sees no middle ground between the 'ma and pa' shops in need of government assistance and Lehman Brothers.  What about the the hard-working business owner who has risked everything to create and grow a venture that is making a few million dollars annually? He/she gets taxed at over 30%, preventing him/her from putting more money into inventory, exploring new markets, and, most importantly, payroll.

Is the current system fair?  Should those individuals who are, yes, making money while simultaneously providing hundreds of thousands of Americans with jobs be taxed until they can no longer employ?  'Redistribute the wealth' progressives see American GDP as a pie.  It is permanently an eight-piece apple pastry that is inappropriately and unfairly distributed amongst Americans.  My political philosophy can be summed up in two counterpoints to this metaphor.  Firstly, if this is the case, government attempts to spread the wealth (or pass out the pie) in such a way that the gap between 'rich' and 'poor' gets smaller have been completely ineffective.  Secondly, high state and federal income and corporate taxes stifle economic growth.  If the state took its foot off the neck of American entrepreneurs, we could just make more pies.