Budget Battles

Let’s face it – even if the US is not faced with a looming deficit and at risk of defaulting on its debts if the debt-ceiling is not raised, Congress should still be debating what the nation is spending its revenues and resources on and how to extract the most out of every dollar spent.  Congress should never be complacent, as they have been during the years of economic growth and prosperity, about the inefficiencies and bad policies we see at every level of Government. 

The results of the 2010 mid-term elections carry with it a clear message: the voters are tired of the same-old, same-old.  The Independents, tired of having to choose between two sides that have become so similar that it is hard to tell them apart, voted in a whole new bunch that ran on the message that they want to change Government.  Indeed, some of them ran on pretty extreme messages but it seemed that the risk was worth it, if only to stir things up and get the fat cats out of their seats to start doing something to right the ship.   

If we could rise above all the rhetoric about the numbers and who would be to blame if the government was shut down because no agreement on the spending cuts, we would realize that the real issue lies in complexities of our laws, layered on year after year, creating bloat and inefficiencies everywhere, sucking up precious national resources.  As the saying goes, “a dollar is a dollar”.  We want to be spending it in smart ways that generate more economic activity which in turn lead to job growth and revenue, and not in paying for duplicative or unproductive processes and administrative structures.

The National Commission on Fiscal Responsibility and Reform conducted a study and came up with a report in December 2010 which we should all examine and build on if we are truly serious about what needs to be done.  It is not a perfect document and dissenting views are clearly enunciated but it is a good start.  The report proposes various changes encompassing:

• Discretionary Spending Cuts
• Tax Reform
• Health Policies
• Other Mandatory Policies
• Social Security
• Process Reform

It is a must read for anyone serious about the debate on our nation’s fiscal health.  You can access it at http://www.fiscalcommission.gov/

In every area listed by the Commission, we need a ‘Reset’ button to push for rationalization and simplification.  Complexities lead to loopholes, creating an unfair advantage for those who cleverly exploit the loopholes and a gross disadvantage for others.

We need a Reset button for our tax laws to account for the shift in economic and political dynamics we are witnessing around the world.  Asia is fast becoming the biggest consumer bloc and our survival and success will depend on how adept we are at meeting the challenges ahead.  To that end, our tax laws must be redesigned to incentivize job creation, especially in the export of goods and services.  We need incentives that will help make the US more competitive in the global market.  We already have some of the best institutions of higher learning, a well-trained workforce, excellent design and marketing skills, and fertile entrepreneurial breeding grounds especially in new-age technology.  Yet, our existing laws favor the off-shoring of millions of technology jobs to other countries.  We need our lawmakers to help bring about the re-creation of those jobs in the U.S.   

We need a Reset button for our defense strategy and our national security.  We can no longer afford the price of being the world’s sole policeman.  Recent events in Africa and the Middle-East have shown us that any change towards a more democratic world must come from within.  We need to be smarter about how we screen passengers at security checkpoints across the country.  We cannot afford to layer on more and more scanners, personnel, and checks each time that Al Qaeda threatens another attack on the US.  The Department of Defense spending has more than doubled between 2000 and 2010, ballooning from $300 Billion to just under $700 billion, and that number excludes Homeland Security and Veterans Affairs costs.   

We need a Reset button on healthcare and medical tort reform.  Healthcare providers today do not want to risk potential lawsuits and higher malpractice insurance and consequently they will often (especially if asked) prescribe all recommended tests and treatments regardless of whether or not they will be beneficial to the patient.  We need a rational quality of care that is determined by a panel of experts, not lawyers.  We need programs that encourage people to adopt a healthy lifestyle. We cannot afford a growing population of expanding waistlines and higher incidences of obesity, including cases in the very young.  Beneficiaries of government assisted programs such as Medicare and Medicaid should be subjected to annual “performance tests”, monitoring their weight and waist measurements. If their deductibles and co-pays for medication increase along with their expanding waistlines, they would quickly join the pound-for-pound challenge on the Biggest Loser.

We need a Reset button on end-of-life care.  We cannot afford to confuse compassionate care for the dying with extending life artificially. Trying to postpone the inevitable outcome for the very sick and the very old while denying care to young children which will allow them to grow into healthy, productive lives makes no sense. The notion that we will be ‘killing grandma’ by rationing care is ridiculous when the alternative is to have grandma hooked up to a host of machines and tubes for feeding, breathing, medicating, urinating, etc., because we can’t let go. We’re adults and we must think and act as adults.  Advocating the notion that a logical plan for end-of-life care means ‘killing grandma’ is infantile.

We need a Reset button on our energy policies.  We need to end our addiction to oil.  Our dependence on foreign oil hurts us, making us subservient to oil producing nations and lender countries that have autocratic governments.  We need to raise taxes on gas-guzzling vehicles while encouraging more eco-friendly cars.  We need to revisit subsidies to big oil corporations.  We need to invest in new infrastructure that will help move our energy consumption towards sources that are renewable.  We need to expand our electricity grid so that we can bring solar and wind energy from solar and wind farms to the cities and towns across the country.  We need to invest in support systems for car-pooling and use of mass transportation.  The arrival of hybrid and electric cars are great but they alone will not make a significant enough dent in our total oil consumption.

We need a Reset button on government jobs, civil and military services.  We need to flatten organizational structures and end promotion and pay increases based on seniority.  We need to eliminate unnecessary paperwork, pencil pushers that add no value to a process, increase productivity through greater automation and move towards a self-service model through modern technology.  We need to consolidate departments that overlap in function and we need to eliminate outdated regulations that discourage businesses from setting up shop or expanding their operations in the US.  We need enforcement officers that are more attuned to the problems businesses face and who will help them meet regulatory requirements rather than act simply as a deterrent to lapses and failure to comply.

We need a Reset button on our policies on granting visas to bona-fide visitors to encourage in-bound tourism.  We have amazingly beautiful cities, national parks, and exciting man-made attractions.  We have museums and art collections that are the envy of many.  Tourism is a highly labor intensive industry and it will create jobs that will always remain in the US.  We need to end the levying of hefty visa fees and, more importantly, we need to end the discrimination against young, single women.  The trend, seen first in Japan and now around the world is for more and more single female workers with a disposable income for whom travel and shopping are high on their priority list.

There are many more Reset buttons that can be added to the list.  However not a single one will be in place if our politicians continue in their game of ‘chicken’ and care only about their ego and political ideologies rather than the nation’s needs.

We are living in a fast changing world and systems and processes that worked well in the past may not be sufficiently adept in meeting the needs of today. Lengthy budget battles year after year distracts us from looking at what we need to be doing to positively influence America’s economic future and its role in a freer, more global and more democratic world.