Solutions to Balancing the Federal Budget 10 a) What is required to balance the budget, view of disability
Our current annual budget deficit stands at just under $ ½ trillion and while it is declining the prospect for a balanced budget any time soon is not good. Keep in mind that the deficit is only declining as a result of projected increases in revenue (more tax collected). At the same time government spending continues to increase, albeit at a slower pace. (While I was writing this the trend actually changed and the annual deficit for 2015 reversed and is now increasing again.)
What could our representatives do to change this?
Following are few ideas (nothing new here, just requires a bit of leadership):
- Quit making disability payments blindly. I am not opposed to assisting disabled persons, especially those that have been injured in service to their country. What we all know is that many folks who receive this payment are still able to perform productive tasks. Let’s require all, but the severely disabled, to perform some productive task either in service to the country or, in certain cases to industry (where they would actually make the payment), to qualify to receive these payments. Using this method we could probably save 1/3 or more of this cost.
- Source for below: http://www.breitbart.com/big-government/2013/03/25/govt-spends-more-on-disability-than-food-stamps-and-welfare-combined/
- “The federal government spends more money each year on cash payments for disabled former workers than it does on food stamps and welfare combined; America’s two largest disability programs, including health care for disabled workers, costs taxpayers $260 billion a year
- In some parts of the country, such as Hale County, Alabama, one out of every four working-age adults collects a disability check
- As of 2011, 33.8% of newly diagnosed disabled workers cited “back pain and other musculoskeletal problems” as their reason for being unable to work. In 1961, the top reason for being disabled was “heart disease, stroke”
- Disabled workers do not get counted in the unemployment figures. If they did, the numbers would be far higher
- Less than 1% of people who went on disability at the beginning of 2011 have returned to the workforce
- The Supplemental Security Income (SSI) program–which covers kids and adults–has exploded. SSI is now seven times larger than it was 30 years ago.” Assuming we could convert 1/3 of this program into production it would save in excess of $85 billion annually.
stay tuned for more on this subject
The National Debt, personal debt & scary Unfunded Federal Obligations (the other UFOs)
9 a) What do you mean “Unfunded Liabilities”?
As was mentioned the earlier blog we have a significant problem with the National Debt as it currently stands at over $18 trillion. I also mentioned the good news and that is that the rate of growth has slowed to $ 1 million every three minutes. Further, the annual deficit is actually reducing and moving towards a balanced state. Unfortunately the rate of decrease is rather minor and appears to be slowing slightly. If it did remain unchanged we could expect it to balance in 2065, but by that time the National debt would well exceed $30 trillion.
Most folks are not aware of the even bigger picture of National Unfunded Liability which stands at over $123 trillion! What comprises this Liability?
By far the largest unfunded liability is for Medicare at over $79 trillion. Most of the remainder are health related: Prescription Drugs & Healthcare. Social Security unfunded debt is small by comparison at just over $15 trillion. When pondering these astronomical numbers which amount to almost $1 million per American Household think about the issues that were raised in the blogs on our Health Care System and why so much time was spent on this area. The cost of Health Care is the most significant issue we are facing and yet no substantive action is being taken to resolve. You can keep up with the status of these unfunded liabilities at:
You can monitor the status of our National Debt and annual deficit (or surplus) at:
What this means to me is that we have completely mortgaged our future. This unfunded liability is far too great for to ever think about paying to catch it up. Currently it is not being funded, but the amount increases every minute. You might think that, “this is not my problem”. Let the government solve it. Unfortunately we are the government and your elected representatives have created this liability for all of us. How do you feel about it?
8 d) Two party System – Summary of budget results for the Parties
Republicans increase in the national Debt 2001 – 2008 with Presidency = $2,004 billion ($2 trillion)
Democrats increase in the National Debt 1993 – 2000 with Presidency = $ 321 billion
Republicans increase in national debt when in control of both houses of congress = $ 1,221 billion ($1.2 trillion)
Democrats increase in national debt when in control of both houses of congress = $ 1, 075 billion ($ 1.08 trillion)
How do the above results compare to the promoted party agendas? The short answer is that they do not with respect to balancing the budget. From a presidential point of view it appears that the democrats have had more fiscal responsibility and from a control of congress perspective it appears that there really is no difference! It appears that, at least in the fiscal responsibility area, the parties have been co-conspirators.
The bad news is that we are now (April 2015) standing at over $18.2 trillion in National Debt. The good news is that the rate at which the debt is growing is actually slowing. Currently it is increasing at the rate of only a million dollars every three minutes. The not so good news is that the rate of decrease appears to be stalled so the deficit will continue to increase. It is also important to note that spending continues to increase and it is only the projection of improved revenues (higher taxes) that has slowed the rate of the deficit.
Unfortunately the National Debt is only a very small party of the National Liability. Future blogs will discuss this much larger issue!