It is our government’s responsibility to provide a stable and equitable environment for commerce.
- Government has a vested interest in promoting long-term economic stability.
- The overall health of the nation’s economy is subject to the actions of our elected officials.
- Projects, programs, and policies of the government affect the flow of commerce in both positive and negative ways.
Setting up the national budget using the Modified GDP (MGDP).
- Setting a measure to fix the amount available to run the government.
- The GDP is the value of all goods and services produced by the business in our economy.
- The MGDP is the Gross Domestic Product (GDP) as currently calculated less the services and goods consumed by government.
The budget must have three parts:
- 5% must be set aside to pay off principal on the national debt
- 1% must be set aside and held in reserve for downturns in the economy
- 94% of the calculated budget will be for all annual spending of the government.
Any unbudgeted emergency funds would require tax increases for the next year in the form of a surtax.
The one percent reserve fund is to be used only when the economy transitions into a recession, allowing the government to maintain levels of service or stimulate the economy.
In a prolonged recession, the government would be required to cut expenditures for operations, but should provide target programs to stimulate the economy from the Reserve.
The reserve is not a fund piling up in a bank account;
- it is paying the reserve amount on the national debt.
- Think of it as room on a credit card.
- The government must be proactive in preparing for the certain slowing of the economy versus the current approach that a good economy will always be with us.
A balanced budget needs an evaluation of the programs and services provided by the central government. The evaluation must address the role of the central government.
Balanced Budgeting is not a method for the government to create unfunded mandates for state and local governments.
- Congress passed programs must be funded by the central government.
If courts decide state or local governments are required to provide a service,
- then the state or local government is responsible for the funding.
Programs and departments have been enacted and preserved without review.
- Each program must be evaluated to discover need or funding.
- Where multiple programs service the same need, they must be streamlined and consolidated to provide efficiencies.
This department should be consolidated into other departments with the focus of The Federal government should return to the duties of defense, commerce, and protecting liberty.
- State and local government should be the focus of service with the Federal government in a support role.
- being a support for state and local governments, not a controlling force.
Centralizing government power has eroded one of the strengths of our society,
- which is a diversity of ideas.
- The Founding Fathers understood the needs of each region have different challenges, needing solutions for the issues that are uniquely their own.
- This experimentation in providing services allows for new ideas to be tried in various areas.
- When new approaches proved successful in one location, other States, and local governments could evaluate the approach to discover if it would work in their region.
Centralized management does not work in commerce or government as taught by the fall of communism.
- Centralization only satisfies the need for control by those in power.
- The best management fixes goals and measures, this frees the system to meet needs.
The cost for the Federal government to fulfill its responsibility must be determined.
At current levels, the Federal government consumes roughly 25 percent of the GDP,
- an amount which exceeds tax revenues.
- Spending is sustained by increasing the national debt
- Illegally raiding the Social Security and other trust funds.
- Illegal is the correct term because the legislation passed to create the surplus in the trust fund, banned the use of the fund for day-to-day government operations.
The goal should be to reduce the percentage of the gross domestic product government consumes.
- By controlling costs,
- Canceling programs
- Growing the economy.
Without addressing the programs, projects and policies that have created the national debt, no amount of new tax revenue will be enough.
Balancing of the budget may need more tax revenues. But taxes should not be increased until spending is controlled.
The country must decide what services are to be provided and put in place a taxing system to provide the necessary funding.
These revenues can come from increasing taxes under the current tax system or by changing the tax system to the asset-based system
No matter how it is accomplished, a balanced budget is a necessity for the long-term financial health of the country.
The budget should have a few simple protections:
- All credits given against taxes are to be accounted for as collected taxes and a corresponding expenditure.
- Thus, reflecting the true level of spending.
- To dissuade the politicians from trying to hide the giveaways in the form of credits.
- Total spending by the Federal government cannot exceed some set percentage of the MGDP.
- The national debt cannot exceed the balance recorded when the balanced budget legislation is passed.