That comes to about $330 for an average family – taken directly out of the nation’s struggling economy. We’re told, don’t worry, it’s paid for.
How’s that? $10 billion is from increasing taxes on businesses with foreign subsidiaries. But remember this: BUSINESSES DON’T PAY BUSINESS TAXES. Business taxes can only be paid in one of three ways – by us as consumers through higher prices, by us as employees through lower wages, and by us as investors through lower earnings on our 401(k) plans.
Another $12 billion comes from cuts to Food Stamps starting in 2014, but we’re going to use the savings starting now. I tried that one out with my wife at home. “Honey, sure we can afford that new jet ski this year – I’m planning on cutting our grocery budget by $10,000 in 2014.” I’m sad to report that she didn’t buy that.
We’re told this is part of the plan to “save or create” jobs. This isn’t saving jobs – it is destroying them. Government cannot inject a single dollar into the economy until it has first taken that dollar out of the very same economy.
We see the job “saved or created” when the government puts the money back into the economy. What we don’t see as clearly are the jobs lost or prevented when the government first has to take that money out of the economy. We see the lost or prevented jobs through chronic unemployment rates and a stagnant jobs market at a time when we should long ago have moved into a normal “V” shaped economic recovery.
Nor does this even guarantee saving teaching jobs. Good school boards, faced with the choice between a couple of good teachers or a pointless and over-paid bureaucrat are probably going to keep the teachers and fire the bureaucrat. But this bill says they don’t have to make that choice. Indeed, this bill says they’re actually prohibited from doing anything that would reduce their spending below last year’s level.
What about Medicaid? A bi-partisan group of legislators in my state of California tells us they need this bailout money to save the state’s Medicaid program. But bailing out bad management doesn’t improve it. At the peak of the good times, when California was taking in more money than ever before, it was already running a deficit of over $9 billion – almost ten percent of its budget.
Just four years ago, those same legislators voted Medicaid expansions that have increased its share of general fund spending from 14 to 19 percent. California offers such Medicaid options as acupuncture, chiropractic services and psychological counseling.
And now they’re shocked-just-shocked that they keep running out of money.
I love my state, but deficits that are made in California should stay in California.
With the nation now some 13.2 trillion in debt – 93 percent of the entire economy – it is time to invoke the first law of holes: when you’re in one – stop digging. And if Congress doesn’t invoke that law now, I can all but guarantee you the American people will invoke it in November.