Political Reform

Budget Page 2

        Second repeal Obama Care
This program costs almost 900 billion per year by itself.  Eliminating it would do most of the work of balancing our budget. The fear uncertainty and doubt small businesses face as to how much health care for employees will cost as this bill goes into full effect is also depressing job creation, so we could balance our budget and stimulate job creation all at the same time. There are better and cheaper ways to reform health care which I discuss on my health care page.  Please go there for the full discussion.  I don't know about you, but my insurance premiums went UP by a lot when Obama care went into effect.  So getting rid of it would be no loss.

        My American history professor had a PHD in economics.  He used a demonstration based on economic principles that showed why our government spends so much money.  He put 5 volunteers from the class up front, and gave them all $2.50 in dimes.  Then he brought out a box of candy bars and offered to sell them candy bars for $0.10 each  (limited to 5 per person)  He told them that any money they didn't spend they were free to keep.  The catch is that whenever someone buys a candy bar for a dime, all the others also have to pay a dime.  Each chocolate bar really costs 50 cents, but the person buying it only loses a dime, the rest is covered by the others in the group.  In economic theory this is called an externality.  The person receiving the product is not paying the full price, and thus he will order as much as he can.  If you try this demonstration you will find that if your volunteers are smart they will all ask for the maximum number of candy bars.  This is because if you don't purchase a candy bar you really only get to keep 10 cents, but if you do buy it you end up with a candy bar worth 50 cents in any vending machine.
        This is a good model for how the federal government works.  All the states get taxed, and that tax money goes into a general fund.  Senators and congressmen then fight and argue to try and spend as much money as possible in their state.  No politicians really try cut back spending in their state, because they would only be able to show a tiny reduction in total taxes, compared to the large value of a major public project.  This system of taxing everyone to pay for projects that are local in nature will always maximize government size and spending.
         The state that benefits from a project should be the only one that is taxed to pay for that project.  That is fair, and it will cause the politicians to be more careful about wasting money since if they don't spend it they can directly reduce taxes on their own voters.

        Forth give the pentagon the ability to decide how they spend their budget.  Military spending is some of the most wasteful because that is where so many of the earmarks go.  If we gave the pentagon the ability to change how they spent money on the condition that half of the money saved would go back to the general fund, then the pentagon would be highly motivated to find ways to be more efficient.  My guess is that they would be able to cut 10% off the total budget.  This would provide a 35 billion cut in budget, and at the same time give the military 35 billion more to spend on all the equipment they have been begging for to help properly equip the men in the field.  I've talked to friends of mine who are in the military, and they've told me that many of the things the military does are deliberately inefficient because some congressmen or senator wanted them to spend more money in their state.