Posted by Leonard Steinberg on March 1st, 2013
As the SEQUESTER kicks in to-day, automatically cutting certain budgets across the board, the stupidity surfaces when you realize the cuts do not address the largest areas of the budget: entitlements. Imagine your household is having a budgetary crisis: would you cut the rent, the largest monthly expense, or would you cut the use of lights? Certainly it would be wiser to address the largest areas of your budget as the priority knowing they could have the greatest impact?
In the budget deficit debate, little mention is made about efficiencies: If you were cutting your household budget, maybe you could address electrical costs through the use of more efficient light bulbs and better insulation. Watching the government at work is certainly all you need to know that there are VAST areas of efficiency improvement.
Non-defense discretionary spending is headed toward historically low levels; the president’s budget will have this category at 2.8 percent of gross domestic product by 2017, the first time it has been below 3 percent in more than 50 years. So cutting discretionary spending may sound good politically but it is basically rather stupid as it more than likely will affect job growth and the GDP.
The biggest problem we face are inflated healthcare costs from a corrupt and/or inefficient medical industry. And that’s both pre- and post-Medicare. When we get a grip on this the whole issue, our long term debt becomes a lot more manageable – most of it being in Medicare. The first step is to get robust growth back into our economy. Now the Sequester could achieve the exact opposite. More proof that the US government continues to fail us.
Now word comes that even though the payroll tax holiday ended and gas prices are sky high, Consumer Spending in the U.S. Climbed Even as increased taxes hurt incomes. Nothing makes sense anymore.