federal government Archives - Messenger to the Thoughtful

If we managed our family checkbook like the federal government, we would all be bankrupt. It is one thing having deficit spending in wartime or particular crises. It is quite another to simply print money, sell T-Bills and leave $30T for future generations to manage. It is immoral, unconscionable, and terrible economics. We have tried to be a warfare and welfare states since the 1960s and we must alter course.

In this essay, I am not ranting about the current administration’s out-of-control spending and highly political largesse for voters. Anyone can do that. I am not going to lambaste both parties for their refusal to trim waste and remember that all the money they spend in Washington, D.C. originates with taxpayers. I am going to offer a way forward that is at first glance naïve and simplistic, but upon further reflection, incorporates the insights of leading thinkers of the last half-century and is non-partisan and non-ideological.

I think we must argue about spending priorities, just like the family dinner table, a small business, or the corporate boardroom. I think we must argue about a fair tax system, from flat taxes, modified flat taxes, progressive tax rates, and levels of corporate taxation. Let the debates begin in the House of Representatives where they belong, and let Congress do its job.

We also forget that decentralized administration is almost always more efficient and fairer, so it should be a long-term priority to have our states, counties, and cities receive a larger portion of our tax dollars and Washington, D.C. much less.

OK, here are three simple points that will transform our economic future, without starving anyone or leaving America defenseless.

ONE: We must achieve a truly balanced budget ASAP, preferably in the next five years, beginning with significant deficit reductions and then living within our means. What does this mean? Here are some ways forward under this heading:

Reduce ALL federal spending by 15-20% across the board, targeting inefficiencies, encouraging retirements, rewarding departments under budget, and placing moratoriums on discretionary spending. (Oh, and place all elected and appointed officials back in the social security system and privatize their pensions.)
Look to eliminate unneeded agencies, restore as many functions as possible back to state and local governments, and welcome input from business leaders on more effective administration.
Decide ahead of time that we must live within our means. Need more money for a particular program that is working? Then find new revenues that are not hurting the productive and perhaps cut other budgets if needed.

TWO: We must transform our overly-complex federal tax system. We have higher corporate tax rates that many “semi-socialist” nations in Europe. The top 10% pay more than 60% of the taxes and almost half of all American pay little or nothing. Here is a pathway forward:

Move to a modified flat tax that is revenue neutral from the baseline of a selected year, like 2019 (when the economy was good). Start at 5% and set the cap at 20%. Do the math. There is enough money.
Over a five-year period, eliminate all personal deductions – yes, ALL deductions, including charity, mortgage interest, etc. If I know I will never pay more than 20%, then I am still incentivized to earn more. If I know that at least 5% will be paid, I will aim to work hard and advance.
Corporate tax rates must be fair and reasonable and we must stop the cronyism that exempts some elites and places the burdens on the rest of corporate America. Tax only profits after accounting for expenses, R&D, etc., and do not tax dividend, stock, and other capital gains above the lower rate. I recommend 20% as a maximum rate.

THREE: This is the hardest of all: We must stop looking to the federal government to directly solve problems best tackled by more local private-public partnerships. WE DO need the universal ethics of the federal government, but not the ubiquitous administration. For example, an FDA is good, but a government-run meat company would be terrible. Here are some first steps:

End all loans for education. Encourage grants and scholarships from states and private sources. Continue with scholarships for veterans and particular fields that serve the common good.
Streamline military and welfare agencies so that the cost of services is reduced and the frontlines are actually helped instead of everything being entangled in a bureaucratic mess.
NO taxes on personal inheritances. It is immoral to tax again monies already taxed.

The burden for these changes is on us, the American citizens that vote. Will we see the moral problem of spending or capitulate to fatalism and hope we get our share? Our grandchildren need our courage! And if we make these changes, our economy will again be the envy of the world.

Endless federal deficits. Porous borders and immigration chaos. Selective enforcement of oversight laws and regulations in the EPA and IRS. Health care for all that includes 2400+ exemptions, including government employees. A foreign policy without direction. Serious scandals dismissed as phony and a media that is rarely investigating those currently in power.

These and other problems are not five years in the making, though the current Administration has done little to resolve and much to exacerbate this state of affairs. Our current crises are a century in the making, beginning with some of the unintended consequences of the Roosevelt Administration in the first decade of the 1900s, continuing through the elitism of the Wilson years, accelerated by the policies of FDR and codified by LBJ’s Great Society in the 1960s. Neither Democratic or Republican leaders have been able to reverse the trends that are presently carrying our American experiment toward oblivion.

The fundamental issue for over a century is the disempowerment of individuals and local government by the Leviathan of ever-increasing federal power. It is important to note that this essay is not a nostalgic foray into a mythical past. We need federal agencies for everything from protecting civil rights to decent food and a clean environment. The ethical and social oversight that ensures freedom and opportunity is a vital part of the original intention of the founders. What was never in their minds and must be altered in ours was the federal administration of so much public money! The corruption, bad stewardship and inefficiencies of federal power hinder the good intentions of most citizens that want compassion, safety and reasonable public services.

We must begin a reversal today and re-empower local and state governments and restore the dignity of personal virtue as the critical foundation for liberty. This will not happen overnight and will call upon every moral and spiritual resource we possess. We can begin by taking ownership of our decisions and votes and calling upon public servants to serve rather than be enriched at our expense. We must not allow collectivist or libertarian extremists or social elites to control the public conversations critical to our future.

We can reverse a century of malfeasance in less than a decade if we will find the courage to stop over-promising and under-delivering largess and call upon the better natures our citizens to contribute to the common good through their business and charitable enterprises. We must welcome people of all faiths (or none) into the civil-political discourse and stop pretending that religious values have no place in public life. Coercion of conscience has no place in a free society, but faith convictions are not restricted to the private sphere. Polite and robust debate is good for freedom and we must not permit one political party or religious tradition to impose their will and stifle dissent.

Wealth can be created while caring for the environment and compensating employees fairly. The tax code needs complete transformation – and some folks will need to find other employment. Military readiness and care for veterans are important priorities. Our policies must stop rewarding irresponsible behavior. Our management of the public purse needs an overhaul, releasing some local, state and federal workers to the private sector. Immigration policy requires courage and decriminalizing drugs is a social folly.

All these words are easy to write – and extremely hard to practice because our system discourages disrupting current norms that might displace voters. When enough citizens find courage and their elected officials discover integrity, we can reverse the tides and uncover new wellsprings of potential and prosperity.

Category Archives: federal government

A Great Reversal is Possible