Great News on the Budget

11/11/2005

The Republican leadership has indeed suffered a great defeat on the budgetand there will probably be many news stories on the future of budget cuts and the Reconciliation bill. What the public really needs to know, however, is that the proposed cuts and the Reconciliation bill are just diversions; the cuts will have little impact on the financial health of the government in the long term.

Personally, I think many Republicans, Gil Gutkneckt included, are engaged in a publicity effort to paint themselves as “fiscally reponsible” after reigning over one of the most fiscally irresponsible periods in American history.

Federal spending has increased under George W., but as a percentage of GDP, the standard measure, it is still below the aversage for recent decades. It is not “out of control,” as the Post-Bulletin stated, but it is a problem which the Republican administration has created from itself.

Federal revenue, on the other hand, has collapsed and is way below average as a percent of GDP. This is another problem Bush & company has creatd. Unless congress limites spending and raises revenue, the budget will never come anywhere near balancing. Mr Gutkneckt does not appear to understand this. He is like a man who looks only one way before crossing a busy street.

I recently sent an e-mail to Senator Coleman regarding budget matters. His reply included this interesting bit of information:

“In addition, as Chairman of the Permanent Subcommittee on Investigations (PSI), I have held numerous hearings on government waste, fraud, and abuse of taxpayers’ money.  The results are stunning.  The Subcommittee found instances where banks and accounting firms are using complex tax shelters to avoid paying taxes, which cost the government almost $100 billion dollars a year.”

If Gutkneckt and Coleman got together and forged legislation to close those tax shelters, they could cut the annual federal deficit by one-fourth to one-third and would not have to deny food to thousands of children or raise the cost of Medicare and Medicaid to citizens already overly burdened by the high cost of health care.

I suggest we write or call them to urgently close tax shelters and drop their heinous plans to cut programs for middle and lower income groups. That sounds reasonable and responsible to me.

Regards,
Loyal Nelson