By Deroy Murdock
Monday, December 24, 2012
Raul Castro is right.
The powerful brother of dictator Fidel Castro is almost
always wrong. But he was perfectly right when he told comrades in Camaguey,
Cuba: “No country has the luxury of spending more than it has.”
Even now, as America slouches toward the fiscal cliff,
House Speaker John Boehner (R., Ohio) and leading Republicans seem ho-hum about
limiting federal expenditures and restraining a government gone crazy. Obama
and top Democrats are downright allergic to these concepts. Too bad this Cuban
tyrant’s rare words of wisdom escape Washington’s spendaholics.
There are billions of ways to shrink the $3.8 trillion
federal budget. Let’s start with these:
First, the Mack Penny Plan, created by outgoing
Congressman Connie Mack (R., Fla.), would cut a penny from each dollar that
Uncle Sam spends each year, for eight years. In 2013, Congress would spend 99
cents per dollar disbursed today; in 2014, 98 cents, etc. Rather than consume
24.3 percent of Gross Domestic Product today, federal spending in 2020 would be
capped at 18 percent, just below the 18.2 percent at which Bill Clinton left
it.
Such steady reductions, spanning nearly a decade, finally
would lasso the spending monster. Washington policymakers should be able to
prioritize and reallocate funding within a predictable, slowly decreasing
budget.
Second, Washington should terminate antiquated and
extraneous programs.
FDR launched the
Rural Electrification Administration in 1935 to bring power to Appalachia. It
morphed into the Rural Utilities Service and now spends taxpayer dollars to
bring wind turbines and broadband Internet to the countryside, including an
$81.6 million gift to VTel Wireless. Now that Appalachia has been electrified
since at least 1960, let’s declare, “Mission accomplished,” thank the staff,
retire them, and sell their offices.
Except for
food-safety inspections, the Agriculture Department creates little value.
Americans can thrive without agrocrats dictating sugar prices and paying
farmers some $1.8 billion annually not to farm. Food growers and eaters can
manage without Washington’s relentless interference.
Washington
expands affordable housing, so millions of Americans can buy homes, and
simultaneously supports housing prices, so millions of Americans can enjoy
precious nest eggs. Which is it? Washington should close the Department of
Housing and Urban Development and exit the housing sector, which it nearly
demolished in 2008.
Launched in
1970, the Public Broadcasting Service challenged the three original broadcast
networks, back when many TVs received just 13 channels. Today, anyone unhappy
with ABC, CBS, or NBC can watch C-SPAN, the History Channel, National
Geographic, Turner Classic Movies, and literally hundreds of other culturally
enriching cable channels. Thousands of DVD titles offer tremendous educational
and artistic value. And don’t forget books. PBS and Jim Lehrer will survive
once they fully depart the federal dole and let donations and other
non-government money finance 100 percent of their budget rather than a mere 85
percent, as they do today.
Third, between December 2008 and December 2011,
Washington-based executive-branch civilian employees grew from 345,326 to
368,706. This 6.8 percent expansion across Obama’s first three years is ripe
for reduction, especially when we consider these feds’ paychecks. According to
Bureau of Economic Analysis data analyzed by Chris Edwards of the Cato
Institute, federal civilian employees in 2011 averaged $128,226 in total
compensation ($84,671 in wages and $43,555 in benefits). Private-sector
workers, meanwhile, earned half that: $64,560 ($53,463 in wages and $11,099 in
benefits).
This federal-wage advantage can be obscene. Despite
taxpayer bailouts of $170 billion and counting, Fannie Mae and Freddie Mac
executives get paid as if the housing bubble they helped create still were
expanding. Based on median-cash-compensation figures in a December 10 report by
the inspector general of the Federal Housing Finance Agency, 825 directors at
Fannie and Freddie last year made at least $205,300. Among the agencies’ vice
presidents, 166 received a minimum of $388,000. Thirty-one senior vice
presidents saw at least $723,500. And eleven executive vice-presidents scored
$1,718,200 or more. And this is what these 1,033 feds took home after wrecking
the housing sector!
“The federal workforce has become an elite island of secure
and high-paid workers, separated from the ocean of average American workers
competing in the global economy,” Edwards commented. “Federal wages should be
frozen or cut, overly generous federal benefits should be overhauled, and the
federal workforce downsized through program terminations and privatization.”
Fourth, rather than grant Obama’s wish to borrow whatever
sum he desires, former Reagan Treasury official and Forbes columnist David
Malpass would impose a hard ceiling to curtail spending. Today’s debt limit is
no such barrier. Instead, it resembles an elevator’s digital indicator that
cheerfully chirps past each floor as it zooms skyward.
“The current law doesn’t work because it threatens
defaults and government shutdowns, but not spending cuts,” says Malpass, an
economist at Encima Global in Manhattan. “Better would be a permanent
debt-to-GDP limit that forces Washington to do what it is paid for — make true
spending choices.”
Malpass explains further: “A new law would give the
president extra authority to cut spending (e.g., impoundment authority or a
fast-track process for entitlement reform), but then shove him in that
direction. When the debt ceiling has been breached, this law would require that
the president give monthly spending updates to the public — in person. It would
prohibit all raises for government employees making over $100,000 annually and
require lobbyists to file weekly disclosures of their contacts. It would defund
congressional travel while over the debt ceiling. The idea is to make
Washington wear a hair shirt that is so uncomfortable that federal officials
actually cut spending.”
If Washington will not stop hiking spending, spending
hikes will stop Washington. How sad that nearly every Democrat and too many
Republicans cannot grasp a concept self-evident even to a Cuban Communist.
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