Milton Friedman frequently said, “Cut government spending. As much as possible.”
Friedman was a brilliant economist who believed in maximum freedom for individuals. He wrote “Free to Choose,” which is mandatory reading for anyone who believes that excessive government spending results in the confiscation of people’s personal money and freedom, causes unnecessary debt, leads to exorbitant inflation and creates bureaucratic ineptitude, which leads to negligible results that are unable to solve the problem at hand.
Former Federal Reserve Chairman Alan Greenspan used to echo Friedman’s freedom-from-government-spending sentiments in his numerous testimonies on Capitol Hill. When a liberal Democrat would suggest raising taxes to reduce the then-burgeoning annual federal budget deficits that averaged “only” $213 billion — which have averaged “only” $1 trillion since 2008 — Greenspan would respond that while raising taxes might help reduce deficits some, higher taxes harm economic growth. The only 100% sure way, he emphasized, to eliminate deficits was to reduce federal spending.
Republicans in Congress from 1985 to 1997 did just that. America experienced four straight years of budget surpluses from 1998 to 2001 and paid down over $600 billion of debt. Debt held by the public in 2001 was a measly $3.3 trillion. Today it is over $22 trillion. Go figure.
Balancing the federal budget had not happened since 1969. From the looks of it, it may never happen again, unless America elects a supermajority of mature adults to serve in Washington.
There are legitimate government functions from which we all benefit that we cannot ignore or neglect, such as national defense, the interstate highway system and the federal judicial system. There may be $200 billion, generously speaking, in the first infrastructure bill passed into law on Nov. 15 that could possibly help our economy become more efficient and more prosperous. The Erie Canal, when completed in 1825, helped triple the national GDP of the young American republic over the next decade or so.
There is another $1 trillion in the first infrastructure bill, however, that will not contribute to rapid economic growth in all probability. It is a Democratic wish list of programs worthy of submission to Santa Claus.
President Biden’s second bill now under consideration by the Senate, his “Build Back Better” (BBB) plan, is even worse. It is scored to “only” cost $1.7 trillion because it includes a ton of reduced budget time horizons, gimmicks and legerdemain. Everyone who has ever worked in Washington knows it will cost at least $5 trillion over the next 10 years and will not solve any of the problems it purports to solve. It is chock full of transfer welfare-type payments, which are not true “investments” in what will make America more competitive and generate more jobs.
The first rule socialist progressive Democrats need to learn to obey is when you find yourself in a $22 trillion debt chasm, stop digging. When Republicans take over control again, they will need to obey the same rule as well.
Democrats must be trying to book as much new spending as possible in 2021 because they see the tide turning against them in recent elections in Virginia, New Jersey and a lost mayoral race in Columbia, South Carolina. Despite already having unleashed “The Inflation Hounds from Hell” with their policies in less than seven months in power, they are doubling down on all of their socialist rhetoric. They don’t understand that the American people didn’t elect them to re-do The New Deal and The Great Society in one year — close to half the people who voted for Joe Biden did so simply because they hated President Donald Trump so much on a personal level, not his policies.
Joe Biden might be leading his party into one of the worst mid-term election debacles in history.
President Obama lost 63 Democratic seats in the U.S. House in his first mid-term election in 2010 after their massive over-reach with Obamacare. If President Biden and the Democrats keep heading down this road to fiscal perdition, the 2022 elections might rival the Republican rout of Democrats in Congress in 1894 during Grover Cleveland’s second non-consecutive term in the White House, when they picked up 130 seats in the aftermath of the Panic of 1893.
Getting rid of progressive socialist Democrat control of Washington would be the best way to cut federal spending right now.