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Friday, April 14, 2017

Trump's First Budget Proposal

In April 2016, then candidate Trump told the Washington Post that he would promise to completely eliminate the U.S.' national debt over 8 years. (This of course assumed his re-election to a 2nd term.) His first budget proposal includes a 9% boost in defense spending, and deep cuts elsewhere.

Trump is proposing a 31% cut to the Environmental Protection Agency, a 28% cut to the State Department, & deep cuts in foreign aid, medical & scientific research, as well as anti-poverty programs that do things like provide free meals to children and the elderly. Trump would entirely eliminate federal funding for National Public Radio (NPR), the Corporate for Public Broadcasting, and the National Endowment for the Arts.

Trump's philosophy seems to be to shift the funding of many social programs to the private sector - let the philanthropists pay for it. I'm actually okay with that because I see that our current national debt of over $19 trillion is equal to more than $166,000 for every man, woman and child in America.  And it is still growing.  We have to make deep, painful spending cuts somewhere. The problem is that that's not really what Trump is proposing.

Overall federal spending under Trump's proposed budget still comes in around $4 trillion - about the same as in President Obama's last budget plan.  Moreover, the deficit (the amount by which spending exceeds tax revenue) would be about $559 billion under Trump - nearly the same as it was under Obama.  And the Trump budget doesn't do anything to curb the growing spending - or raise revenue to pay for the growing spending for Medicare, Social Security, and other entitlement programs that so many Americans rely on.

Trump's April 2016 pledge doesn't seem to be reflected in his budget proposal.  Don't you think it should be?  

I realize that Trump is already in for a fight.  He believes we're not secure, and by making these deep cuts he's freeing up existing spending for things like the defense departments and construction of a border wall between us and Mexico.  Already the liberals are crying foul, and the lobbyists are preparing to launch their attacks to persuade Congress not to let Trump have his way.  Based on their past behavior, I have no confidence that our Congress has the courage to make deep spending cuts anywhere.  My guess is they will either not let Trump have his defense increases - or they will just borrow more money to pay for it. 

It's even more frightening to consider the prospects of our national debt, when the Republicans are promising tax cuts.  In the face of our national debt and deficit spending plans, they think American corporations and individuals should pay less taxes.  I know there is a much-beloved theory that if we make tax cuts they will stimulate the economy and more taxes will actually get paid.  I haven't actually seen that work.  Ever.  Not in my lifetime anyway. 

While I'm not an expert on world history, I am a student of it.  And so far I'm not aware of any country that has been able to make that work either.  In all the history of the world, it seems that governments must tax their people in order to pay for what they do.  No one has ever been able to cut those taxes and actually pay for government spending.  Not in the history of the world.  And many governments have actually collapsed under the weight of their own spending (and inability to raise the tax revenue.)

Its not inconceivable to me that the U.S.' national debt could top $40 trillion or more before Trump's maximum term of eight years in office.  I remember when Obama took office.  Our national debt was already in the stratosphere.  It was breathtaking.  I could not imagine how our country could go on borrowing.  I honestly feared our whole economy could collapse if the national debt got any worse.  But Obama, and our Congress, had a different vision.  We continued our wars, our liberal social programs, and even implemented a costly health care plan.  The government spending and borrowing continued unabated for eight more years - and the national debt more than doubled. 

Here's the thing I know.  It is expensive to be America.  We have made ourselves the world's police force - moving literally on every continent to fight for freedom and democracy.  We have made ourselves the world's benefactors - shipping humanitarian aid to every continent when there is need.  We have made ourselves the freedom fighters, propping up regimes that we view as righteous, providing foreign aid to the tune of billions to countries like Israel or Egypt.  And of course, we are not willing to say no to our own people.  So we allow the people to vote themselves all sorts of benefits - by sending representatives to Washington who will work to give them what they want.  (Politicians often point to their record of "winning" federal money & program support for their own geographic constituents.)  All of this is expensive. 

Like I said, it is expensive to be America.  And so I wonder how we can move forward if we don't both make deep spending cuts AND commitments to pay more taxes.  When will American individuals and corporations decide that it is worth it to pay our own way?  When will we be willing to make the hard financial choices in order to reverse this collision course with reality?

What are YOUR thoughts about this?

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