Friday, March 11, 2011

The Choice of Two Futures: Chart Edition

The Chairman of the House Budget Committee has been talking to anyone who will listen about the "choice of two futures" that the we have. He has been giving this presentation here. We need to begin to understand the future we have built for ourselves.
These charts will illustrate what I believe are some serious, if not daunting, problems that face our country. The argument is not merely ideological, it is actuarial. As my one and only option for President in 2012 Mitch Daniels says, "If you disagree with me about this, you can meet me in the hall and make sure you bring a third-grade math book."

Federal Spending in Outlays

Many of these graphs need no caption, but really? Does anyone think this is sustainable? For those who do not want to cut, my only question is: how was life before 1970? If all of this spending is essential, then how did Americans live before we had this many outlays. Again, not just ideological, but this problem is actuarial.

National Debt

I am sure this will end well for us.
Federal Budget Projections w/o Changes

"I do not make jokes. I just watch on the government and report the facts." - Will Rogers

Defense Spending

This chart is something of note. If we are ever going to save this republic, then everything has to be on the table. Republicans won't even mention cutting defense spending. Well, that is why I am a conservative. Does it make sense to have a higher defense budget than the other top 25 nations combined? And 24 of them being our allies? We should cut our empire building and military spending and focus on defense.

Rise of Consumer Prices

This is the subject of a whole another blog post. But, since the creation of the Federal Reserve and the move from the Gold Standard, the dollar has lost 95% of its value. The dollar that you once held in 1913 is only worth a nickle today. You can dismiss it and say..."Well we have always had inflation!" Not true. Prices stayed flat for most of our history. Inflation is primarily a product of having a central bank and the printing of money that has occurred for close to 100 years now. Not only are we spending more, accumulating more debt, but prices are skyrocketing.

Government Dependence vs. Personal Savings

Lower interest rates of allowed Americans to borrow more and save less. But given the high correlation between rising entitlement income to personal saving, one can't help but wonder if Americans feel less compelled to save money as they can depend on the government more and more. It is an unsustainable course for us and for the State.

Broken Education System

Everyone who reads this blog knows this is probably my biggest public policy passion: education. Whenever I ask people how to fix education, people always respond with "more money." But, the facts just do not support it. The system must be changed before I would commit any more money to the education system. We have tripled our support to education and scores have remained flat. Minority graduation rates in many states across the country are below 50%. Why does anyone defend the status quo? We need a model based on freedom, choice, and competition.

One of the biggest fallacies of government is to judge programs by their intention and not their results. This is one of those cases.

Losing the War on Poverty

I do not disregard the need to have a safety net for the underprivileged--I just differ on the means. We have judged welfare and the war on poverty by its intentions rather than its results.

In early 60s, the American welfare state was still relatively small, consuming only 1.2 percent of U.S. gross domestic product (GDP). The American family was also still intact, with 93 percent of children born into stable families. But then President Lyndon B. Johnson’s War on Poverty happened. Forty-five years and $16 trillion later, thanks to big government, poverty is winning. Thanks to over $900 billion a year (over 5 percent of GDP) of spending on over 70 means-tested welfare programs spread over 13 government agencies, more than 40 million Americans currently receive food stamps, poverty is higher today than it was in the 1970s, and 40 percent of all children are born outside of marriage.

Out of Wedlock Births and Poverty

The breakdown of the state has coincided with the breakdown of the home. If we cannot reverse some of the dramatic trends amond the American family, we will much less happy and more broke. We need to promote marriage, take away the tax incentives that discourage marriage, and promote traditional values.

We have a choice between two futures. There is one that is obviously unsustainable that I have outlined here. Our founders were aware of this:

"Remember democracy never lasts long. It soon wastes, exhausts, and murders itself. There never was a democracy yet that did not commit suicide."
-- John Adams, letter to John Taylor, April 15, 1814
Let's reverse course before it is too late.


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