The Heritage foundation has producted a video which explains in simple terms how to balance the US budget and how to return the US to growth and prosperity. Please watch it below as it is as entertaining as it is informative. I wish President Obama (debt man walking) would watch it.
The US budget deficit
I am sure everyone understand, the US budget agreement that raised the debt limit, did not cut anything. Zero. Have no illusions it was all fake. Here is why.
It slowed the rate of increase for the next ten years, but spending will still go up and up every year, and government is still expanding. Nothing was cut. It was all smoke and mirrors.
I do not recommend causing inflation to devalue the US dollar and minimize the impact of the debt as some have suggest like Kenneth Rogoff an economist from Harvard in his article the Second Great Contraction.
So people have asked how can anyone, President, economist or congress balance the budget? What is going on. Here is a nice little video, that explains how it can be done.
Translate this into concrete terms – how to balance the budget
Ron Paul has suggested:
- Stop government growth – A five-year freeze on spending increases. That means whatever a department got last year, it gets this year. I was an accountant and ran various departments. A spending freeze is easy and painless.
- Balance the budget – Further, if each department of the US government took a 1% cut across the board, than in five years you could have a balanced budget. Just 1% is all it would take. It could be in one year with bigger cuts. The US could pass a balanced budget amendment.
However, departments, entitlements and agencies of the US government will not consider this because of both parties have entrenched special interests. The Democrats with the expansion of the social state and Republicans with the industrial military complex. I personally do not care which party gets credit for getting the budget under control. I really don’t. I personally think the tea party side of the Republican party take the issue the most serious or Libertarians.
But it can be done with the right leader. The GOP failed the US when they ran someone like Citizen McCain in the last election. Lets hope they choose someone wiser.
But both parties have vested interests and only someone like a Ronald Reagan can convey the message to the American people. So the above plan is possible but needs a real leader.