One of the truths of private sector business is that not all of the effects of a recession are bad. It allows businesses to "trim the fat."
The ownerâ€™s nephew that shows up late once a month for the last three years will be let go. Employees that arenâ€™t hard working, reliable or trustworthy are downsized. Companies will look everywhere for ideas on cutting back on expenses and spending. Employees are cross trained and will end up doing more work with fewer resources. Companies will necessarily purge redundancies in order to save money, enhance margins and grow profits.
A good example is my own life in sales. I can remember only talking to retail store managers in their offices. This is where the business was discussed and buying decisions were made. After the recession, Iâ€™ll now see that same manager answering the phone, working the sales counter, stocking shelves, loading trucks, sweeping the floor and going out on deliveries.
Companies in the private sector enjoy the successes that come with a boom economy, yet they find ways to succeed during a bust one, as well. This is how companies stay profitable and expand during the constant ebbs and flows of business.
The reality of modern government is that funding is now the primary concern of government agencies. Finding ways to be efficient and do more with less is not in the best interests of government. Maintaining a consistent growth is the business model that government strives to achieve. Special interests from both sides help drive the spending and it has gotten so bad that making sound long-term financial decisions will no longer get politicians re-elected.
The hysteria in the first few months of 2013 illustrates my point perfectly. Social Security going up roughly 2% to the original 6.2% isnâ€™t a tax raise, yet Republicans everywhere acted like the heat was going to be turned off and everyone was going to be eating sawdust meatloaf.
For comparison, the much ballyhooed Sequester cuts of 2.3% means that White House tours must be cancelled, the air travel industry must grind to a halt and people will start dying in the streets. Lost in the insanity is that going from 105% of current funding to 102% of current funding is still a spending increase over the previous year!
The rhetoric spewing from both sides shows complete ridiculousness. Obviously, neither side can agree on how to properly spend the tax dollars coming in. If so, how can we possibly expect them to find ways to be more efficient and more productive with fewer resources? As a result, each elected representative looks out for the interests of their own constituency, first and foremost. The welfare of the entire nation takes a back seat to the interests of each individual district. This is a recipe for disaster that leads to a plethora of national fiscal challenges.
How do we fix this?
One modern-day solution to this modern day government problem is allowing citizens that pay federal income taxes to have a say in how some of the money is spent. By using a simple system of itemized codes available on a tax return, each taxpayer could choose areas they feel are important to themselves, their family or the country as a whole.
Before my liberal brethren jump to conclusions, let me say that I think Social Security and debt interest should be exempt from this exercise because these are obligations promised to other people. In fact, by holding the line on spending and just using the money earmarked for future spending increases, we can create ways for the government to become more efficient.
Without using a meat cleaver approach, we can address several of the challenges our current system struggles to solve.
Being able to itemize a small percentage of funds would provide instant data each year on what areas taxpayers are interested in funding on a federal level. Citizens could prioritize big ticket items such as: paying off the debt, health care, defense spending, education, foreign aid, help for the disabled, special education programs for at-risk youth and studies on monkeys humping footballs.
Before you deem me as crazy, I would like to point out that we currently have other people using special interests to decide how they spend our federal income tax dollars. As a country, we easily would find out where our priorities TRULY lie and then could tailor our future economic, education, entitlement and defense agendas around these priorities accordingly. What needs to change is the freelance and cavalier attitude towards spending that has become a sense of entitlement, without reproach.
If the United States is ever going to contain out of control spending, we first need to stop having automatic spending increases until the economy recovers. This is something that the private sector has done for years. Unlike the Sequester, allowing each Cabinet Secretary the flexibility to identify inefficiencies, redundancies and underachieving productivity will surely yield many areas in desperate need of a "haircut."
To avoid the type of chaos that is the new normal, funding could be added or subtracted in small increments that would avoid any sudden and drastic changes.
A cynic might say that this plan isnâ€™t fair for everyone. After all, some taxpayers donâ€™t pay federal income taxes. While they may pay sales taxes, gasoline taxes and property taxes, the current tax code exempts these citizens from paying into the federal income tax system. How can these people possibly get a fair say in what is being spent? Thatâ€™s a fair question.
Contrary to popular belief, I donâ€™t want government to wither away. The government does many terrific things, while providing essential tools and services that we all use to succeed. The obvious solution is asking every taxpayer that uses a road or a school or a library (or the myriad other services available) to pay a minimum of $1 in federal income taxes. After all, shouldnâ€™t we EACH pay at least $1 a year for the benefits our wonderful government affords us?
I think I know the answer to that question.
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