My wife and I are preparing to celebrate our eleventh anniversary, and I am racing about trying to finish preparations for a local youth sports event. Others in our democracy have a very different agenda this week. Some are waiting for the end of the world (this time, it is guaranteed to be May 21), others are doing their best version of Chicken Little…the budget sky is falling!
We do have a very large current deficit fueling an ever-growing national debt. Left unchecked, this fiscal situation could cripple our economy at least as effectively as the geniuses on Wall Street were able to accomplish during the first decade of this century. So, being the fiscally responsible, business-minded people that we are, we seek to control those aspects of our budget driving the deficits. Are the budget issues related to the diminished tax revenues that are characteristic of a recession? Are they by-products of the calamitous inflation in health care expenses? Could they be linked with the Bush tax cuts which, by definition, slashed tax revenues? Is there a connection with the ongoing wars in the Middle East?
If we are to believe the diagnosis of congressional Republicans and the so-called liberal mainstream media, the answer is none of the above. If we are to believe those beacons of fiscal responsibility and budget integrity, the real culprits are poor people, PBS, public school teachers, and food stamps.
This column is not about the relative merits of liberal programs, or the sins of conservative motivations (real or imagined). This is an exercise in perspective; United States budget-style. For fiscal 2010 (President Obama’s first budget), revenues were expected to be $2.381 trillion and expenditures were to be $3.552 trillion. These are eye-popping numbers to be sure, but not out of scale for the wealthiest 320 million people in the world (give or take).
Let’s address this head-on: since 2003, we the people have spent almost $791 billion on the War in Iraq. Since 1970, we the people have spent far less than that amount on the food stamp/SNAP program…total. That is one war of suspicious origin, questionable motivation, and selective ethical foundation, versus the program whose costs rise and fall with the changing need of America’s poor and/or jobless. During times of recession, when our nation’s corporations are safeguarding their profits by laying off the working class, those numbers go up.
During this last year, we the people might very well have spent as much on the artist formally known as food stamps as we did in any 6 month period of the Iraq War. For this reason, pundits and bloggers of questionable humor have labeled President Obama the “food stamp president”, although that moniker might be more fairly leveled at President Cheney and his copilot George Bush. The recession did have its origins in, begin during, and hit its peak within the scope of George W. Bush’s budget years.
So much for food stamps, but the other programs are similarly scaled. Seasame Street, Nova, Frontline, Wall Street Week, The Lawrence Welk Show, and the other elements of PBS were to cost taxpayers $604 million in 2011. The total amount of PBS funding over the decades amounts to little more than an expensive month during the war (and I am not including Afghanistan in this comparison). Republicans who recently voted against killing the $4 billion or so in manufacturing subsidies that largely go to oil companies and other large multi-nationals, tried to kill funding for PBS this year. A $4 billion giveaway to firms with record market capitalizations and record profits, or $604 million to fund Big Bird’s home…you the voter must make the call.
For those of you who aspire to be “pro-business”, an exercise in corporate financial management might be beneficial. The most productive elements of your business always fund ongoing capitol improvements, which is why no less a pair of authorities than Thomas Paine and Adam Smith (the father of capitalism) supported the notion of progressive taxation. Investments should always be made in the areas of the greatest return, and federal spending on people always returns more than tax cuts or federal spending on war. It isn’t ideology, it is an accounting identity. Finally, when a business is confronted with major shortfalls in revenue or accelerations in cost, it attacks precisely those elements fueling the obstacles.
Accelerating health care costs (and by that I mean industry-specific inflation exceeding CPI by more than 4 times per annum), a massive trade deficit driven by the artificially high U.S. dollar, the deregulation-fueled commodity speculation that drives massive oil price inflation, and massive tax cuts targeted at earners who will never spend the difference in economically-productive activities are the root causes of deficit. The question the members of The Rational Middle must therefore ask is; why has there been no legislation proposed by a Republican that addresses any of these root causes?
Your guess is as good as mine, but the price of blindly believing journalists who get their economics lessons from David Brooks and the Wall Street Journal is more than any of you want to bear.
The Rational Middle is listening…