What would you cut from the federal budget?

Well, I would raise taxes, but on corporations of a certain size (to avoid taxing small businesses) instead of individuals.

Most of the defense department. Funding for the wars in Iraq and Afghanistan.

Having worked in the prison systems, I can name thousands of ways to save money there…

Stop all foreign aid spending, military or otherwise. Bring home all U.S. troops. Use them to defend our nation’s borders from the current invasion of foreign nationals. Eliminate ALL funding for the Federal Reserve. Eliminate the Federal Reserve and have the Treasury department do their job.

Defense! I don’t care that I work in it, it must be cut.

Military spending. 600 billion for the pentagon is simply too much.

@mowens Federal prison spending in 2009 was less than $6 billion. Even if we eliminated all of it, that would reduce the deficit by less than ½ of 1%.

@UScitizen The US spent about $18 billion on international aid last year. $0 from the federal budget goes to the federal reserve. In total, your plan would reduce the deficit by just 1.2%

I’d cut military spending, by bringing all troops back, shutting down as many US military bases in foreign countries as responsibly possible. That alone would make a world of difference. Then I’d start brutalizing the Executive branch, shutting down as many “bureaus” and “departments” as possible, and leaving the few necessary ones, in tatters.

Pork, pork, pork, pork, pork.

@Michael Thats the problem with government. No one is interested in ways to save little amounts of money here and there. What people always fail to realize is that it adds up. So, if we cut lets say 1 billion dollars from the prison budget, and 1 billion from every other budget, that gets pretty big pretty quick.

Privatize anything and everything we can plus cut and/or reduce benefits to all Gov employees especially the elected officials who voted for these budgets. It is outrageous they get benefits that almost nobody can come close to in the private sector. This blank check it’s not my money mentality of Gov. politicians and employees is what got us into this mess.

Also, people find ways around cost savings. Example. In IT, one of the easiest ways to save money is taking away everyone’s personal printer at their desk. You buy larger printers meant to handle more people, and put them at different locations throughout the building. This eliminates the supplies for all the little printers, and the time it takes to support them. However, whenever you take away someones printer they bitch and bitch and bitch that they have to walk across the room to get a paper, and 9 times out of 10, they talk to someone who talks to someone who gets it back for them.

Trying to save money and being a manager in an IT department is hard business politically.

@syz According to the Citizens Against Government Waste, Congress spent close to $20 billion on “pork” in 2009. That’s less than 1.5% of the deficit, and less than ½ of 1 percent of total spending.

I think it’s also worth noting that one person’s “pork” is another person’s vital project. Some of the earmarks on that list include things like a hospital renovation at Camp Lejeune (a Marine base in NC) and a technology upgrade for the police force in Jefferson City, MO. That doesn’t necessarily sound like wasteful spending to me.

@Cruiser Not exactly the specific examples I was hoping for.

@mowens That’s a totally fair point. I’m just trying to get a sense if people are actually willing to cut the big things, the stuff that actually drives the deficit. I’m sure you are completely right about the savings to found in the prison system, and we should get those savings because government should be spending every dollar wisely. But we should be under no illusions that saving $1 billion here and there will actually do much at all about the deficit.

@Cruiser When you say privatize everything, do you mean just let people fend for themselves by paying for private police protection, fire protection, for the use of all roads,etc? Or do you just mean outsourcing but still using taxes to pay for it? Like all the outsourced mercenaries in the war on terror making several times what the average soldier makes are saving us money.

@snarp those are state and city driven

@mowens States and cities rely extensively on funds from the federal government to balance their budgets. But fine:

@Cruiser Do you mean we should let people fend for themselves and pay for every bit of weather data, subscribe to weather alerts, not have free access to scientific information, only have scientific research that is directly profitable be performed, pay for all National Park maintenance out of admission fees paid to a private company that can do whatever it wants to profit from the park, etc?

The real money is in three places: Medicaid, Medicare and Defense. Trying for savings from anything else is meaningless. There’s just not enough money there to make a difference. You can’t cut Medicare, and while you could cut Medicaid, it is politically infeasible. So you’re left with Defense. Fortunately the Defense Department is largely incompetent, so if you cut a pool of dim bulbs in half, you probably are actually improving the place.

Sorry, that was mean and unfair, but I couldn’t resist. Defense is such an easy whipping boy.

Seriously, though, Defense is the only place I know of where there is both real money and discretion to cut it.

The federal government.

I would cut discretionary spending 10% across the board, make severe cuts in the Department of Education and cut Medicare and Social Security spending by 2%. Then I’d raise taxes on everybody. The current problem belongs to all Americans, not just the middle class or the wealthy. This tax would be a consumption tax to make it a little fairer, similar to VAT taxes in mature and modern nations.

@Snarp Police and fire is paid for by local taxes not federal dollars. I meant to privatize anything and everything outside the core federal government. There is not one private business that exists because it can continue to run at a loss year after year like the Government does. Companies have to be profitable to exist and do so through fiscally sound management. AFAICT, there is nothing that the Government does that is fiscally sound nor managed correctly and why should they bother it’s not their money!

@mowens
Exactly.

Like Sen. Everett Dirksen (R-IL) said once, “A million here, a million there, and pretty soon you’re talking real money.” These days, I guess we’d have to say, “A trillion here, a trillion there…”

@wundayatta, don’t forget Social Security.

@Michael Sorry My bad….Cut and privatize HHS – 800 bil, Treasury Dept – 700 bil, Dept of Ag – 1.25 bil, OPM 1 bil, Dept of Trans 800 mil…we could make some nice changes and cut expenses big time if we put people in these jobs who are qualified and know what they are doing and not some political appointed cronie!

Pull the troops out of Afghanistan and Iraq and bring them home.

I’d cut defense. I think that preemptive wars are ridiculous. We should focus on intelligence; detecting attacks set to take place within our own borders and preventing them. We should be working with the UN to get the governments of countries that harbor terrorists to stop harboring terrorists. That would be in everyone’s best interest.

@MikeinLondon You really want to cut education? If there is one thing I would not cut, that’s it. You can’t cut Social Security and Medicare and it wouldn’t help, they don’t come out of income tax, they have their own purpose specific taxes. I’m not entirely up on Medicare, though apparently it’s got some trouble, but Social Security has a surplus right now. Neither affects the deficit unless you are talking about projected deficit years down the road.

@Cruiser Where are you getting these numbers? Defense is the majority of the discretionary budget at $663.7 Billion. HHS is only $78.7 Billion. Treasury is $13.3 Billion.

@Snarp Here ya go!!
http://www.federalbudget.com/

The political reality is we probably have to approach the deficit from the other direction. Discretionary spending is only 17% of the total federal budget. The rest is Medicare, Medicaid, etc; Defense; Social Security; Interest on debt; and Veterans Programs in that order. If we shut down the entire Federal Government outside the those required expenses, we would only shave ⅓ off the annual deficit.

That is precisely why giving massive tax cuts is lousy policy to fix recessions. It is bloody hard to jack taxes back up to where they need to be once the hard times end.

When Ronald Reagan took office in 1981, the top tax rate was 70% on income over $215,400. Reagan slashed taxes for the richest Americans three times, taking them down to 28% and setting the top bracket at $29,750. The immediate result was stimulative, but also piled up debt at an astronomical rate. Reagan is the only President ever to triple the National Debt.

But far worse than the debt Reagan added was the course he set for the next 3 decades of “Don’t tax, just spend” fiscal policy. Today, our top rate is 35% and we are still hemorrhaging cash. Now the National Debt is cresting $12 trillion. It’s clsoing in rapidly on 100% of our annual Gross Domestic Product. In 1945, after the spending required to pull us out of the Great Depression and fight WWII, our debt hit 120% of GDP. We paid it down over successive Republican and Democratic Administrations with top rates between 70 and 90%. It hit a low of 30% at the end of Jimmy Carter’s Presidency.

You can try to fix the National Debt with spending cuts, but those cuts would hurt far too many people for anyone who initiated them to stay in office. Any party that promoted them would be banished to Outer Slobovia for decades to come. More “inconvenient truth.” :-)

I would send congress home with no pay for the rest of the year, and let the country operate exactly as it did the previous year. Plus I wold require every person who receives unemployment money to work for every cent they receive.

@YARNLADY You wouldn’t endear yourself to many people telling them you are going to cut off unemployment insurance unless they work. Even people currently working, and getting a paycheck, are likely to figure out they could be in the next batch of layoffs. How, after paying for the insurance, are you supposed to work to collect it when you don’t have a job?

@ETpro There are many jobs that are going undone because the government cannot afford to pay for it. My suggestion is have those who are unemployed do the work. The unemployment insurance is long gone, there is no reserve account that the money went into, that it could come out of. The point is to give them the jobs that have been cut back because of ‘budget’ concerns.

There is a complete disconnect between no jobs, and work going undone due to budget cutbacks. I am also disappointed with the fact there there are over 90,000 jobs going empty in the U.S. and the people who could fill them are not being matched up.

I would love to see the government offer relocation expenses for jobs that can be filled by people who could relocate if only it could be included.

@YARNLADY Ah. Thanks for more fully explaining that. Since money is so fungible, I don’t see how any country that’s in debt up to anywhere near its gross domestic product can claim to actually have reserve accounts for anything. you are quite right. Whatever the moeny is collected for, it’s really been getting used up and then some.

I don’t know if we could put every one of the 7 million unemployed to work, but there’s lots to be done to repair aging infrastructure. I’d like to see more directed at doing that.

@Cruiser I don’t know what kind of strange math the ideologues on that site are using, but my numbers above are the actual numbers. The defense department, by itself accounts for the majority of discretionary spending. It has for a very long time. That means that whatever that chart is supposed to be, it is lying.

@Snarp Exact numbers don’t really matter here…what matters is there is a way to attack this deficit and first and foremost is to stop deficit spending. Second is to eliminate wasteful spending, third is to eliminate earmark spending, fourth is to eliminate the god awful management of this government run departments and fifth is to put benefits for all government employees including the lawmakers who make and vote for these line items in the budget more in line with what we here in the real world enjoy or in the majority of constituents completely lack. It is appalling to see these costly cushy benefits when the rest of this country is struggling and making sacrifices.

@Cruiser Obviously you and I fundamentally disagree on this. I think that the only way to attack the deficit is to raise taxes, particularly on wealthy people. There are some places that spending can be cut, but a lot of Federal government agencies are already underfunded. The only exception is the defense department, which receives more money than any other nation on earth spends on their military, by far. You could put all our potential enemies together and not match or military spending. As for benefits, I think we should definitely bring government and civilian sector benefits in line: by improving civilian sector benefits. Universal single payer healthcare would help with that, since it would take the burden of paying for health care off of employers while providing better coverage and eliminating the horrible inefficiencies of the private insurance system.

The other reality is that if we stop deficit spending now, we run the risk of total economic collapse. We would be a lot better off if the Bush administration had done the responsible thing and maintained that taxation levels of the Clinton years, used the budget surplus under Clinton to pay down the debt, and not invaded Afghanistan and Iraq, thereby maintaining a budget surplus and continuing to reduce the debt. Then we would be in a lot better position to maintain the deficit spending necessary to get the economy through a deep recession.

@Snarp It’s ok by me that we disagree as I do learn by engaging in these kind of discussions. I am smart by my own definition but hardly always right. And that said I will continue in that I see the best way to reducing the deficit is to cut wasteful and deficit spending. Also raising taxes will only compound the problem as doing so only takes more spendable money out of the free market system that generates taxable profits. What we need are strong tax cuts, breaks, rebates what ever you want to call them to allow more money to flow back into the economy. Start with corporate taxes. A 10% reduction in corp taxes would pump so much money back into the system it would make your head spin plus it would send a clear signal to companies that the Gov. is seriously behind businesses so we/they can finally have confidence to spend money to grow their businesses. It’s all so simple Snarp and if you still have any doubt call your cities financial office and ask them what has happened to their budgets…any I know of are on life support…why? because tax revenue is severly down…why?? Because businesses in your community are generating less taxable profits and people are not spending money to generate the needed sales taxes to support your community! Why?? They don’t have extra cash to spend! Why? Because the companies that are still able to provide jobs to your neighbors are hurting and can’t afford to give raises and bonuses those things that create disposable income.

So you think raising taxes….taking more money out of peoples pockets so they have even less to spend is your solution!! And don’t go down that road that you will only tax the big corporations as these big corporations employ lots and lots of people and taxing those Corporations they will do what they have been doing and that is to continue laying people off, cutting payroll expenses, bonuses, benefits and more hiring freezes to offset these tax burdens. Not exactly the way to stimulate the economy IMO.

@Cruiser Sometimes tax cuts are the right way to stimulate the economy, usually when only a small stimulus is needed. Sometimes they are the wrong way to stimulate the economy, usually when a larger stimulus is needed. Large and small aren’t the only considerations of course, another consideration is what does consumer spending look like and what is the gap between rich and poor. When the gap between rich and poor is large and consumer spending is low, that means that too much money is tied up in too few places and most people don’t have any money to spend. No money to spend, no consumer purchasing, no money rolling into business, no jobs created. This is why Henry Ford paid his employees above average wages. This is why the New Deal helped get America through the depression by taxing the dickens out of wealthy people and why WWII was even more effective, because it allowed the government to take more control of the economy, raise taxes even further, create more jobs, and put more money in more people’s hands.

Corporate taxes need not be cut, but I see no need to raise them. Most corporations pay close to nothing in net payments to government. Some even make a net profit from government. Corporate taxes are really a non issue. The one good thing about higher corporate taxes though would be that it would encourage corporations to spend more, not less. Corporations largely avoid paying taxes by not making much money. The general goal of a corporation is to make a certain amount of profit, enough to satisfy shareholders, but not enough to pay a large tax bill. Thus corporations will hire workers, invest in equipment, and give gifts at the end of the year to bring their profits, and therefore their taxes, down.

The idea that wealthy people will not invest or have incentive to make lots of money if they are taxed heavily is absurd. U.S. tax rates are marginal, if you make over $186,825 a year you pay the same rate (10%) as any one else on the first $8,375, and this is true for each bracket. It’s only on the money over $186,825 that you pay the top rate (35%). So if we created very high tax rates on very high incomes, for example a 70% tax on anything over a million dollars, what would you rather have, 65% of $1 million dollars plus 30% of 2 million dollars, or just 65% of 1 million dollars. Even with the higher tax rate, more money is still more money.

The truth of this is borne out by the fact that America recovered from the depression and went through decades of strong economic growth and very little deficit spending with extremely high tax rates on the wealthy (between 70 and 94% for the top earners). It was only when Reagan drastically slashed these taxes that deficits spending became a problem. And the singular experience of the Reagan boom is a pretty small piece of evidence for the notion that lower taxes stimulates the economy. Higher taxes worked well for decades, drastically lower taxes correlated with a brief boom followed by rather high volatility. Seems like there’s a lot more support for the notion of higher taxes, and yes I’ll say it: redistribution of wealth, which is sometimes necessary under a Capitalist system or the whole thing collapses under the mass of wealth accumulation leading to a Great Depression.

@Snarp Your line of reasoning makes sense in a perfect world. The problem I see with either of our POV’s is they rely on strong leadership to make the tough decisions and get the people of this country to believe that it is the right thing to do. Bush blew it big time in that department and Obama just crashed into the wall in similar fashion with his dreadful 1st year performance. The bi-partisan bickering that has infected the House and Senate has hog tied our ability to pass meaningful legislation to help turn this economy around. Nothing will work right now until Obama starts doing what he promised during his campaign and that is to foster bi-partisan support for his policies.

@Cruiser I’m not going to say any one party is to blame for anything, but the Republicans in congress deserve at least as much blame for partisanship as Obama does. That said, what we have is indeed a bunch of people who say my way is the only way, ever and another group that say your way is the only way, ever. Neither group is willing to admit that economics is not an exact science, that politics is even less so, and that sometimes everybody has to give a little bit.

@Cruiser You are right in saying it would take a very powerful, charismatic leader to seel the public on the wisdomw of either method of cutting the deficit. Budget cutting and spending freezes sound so good till the layoffs and loss of services they entail hit. Cities and states are doing their best to deal with this right now. Imagine the pain of trying to cut enough federal spending to actually pay of $12 trillion in debt. That’s 4 times the size of the entire federal budget.

Please go up and read my original answer to this question. We’re not talking about something where perfect worlds are required. We’re talking about something we have faced and fixed before. The greatest generation rolled up their sleeves after WWII and, with taxes as high as 90% and above, they paid down the deficit, which had hit 120% of the Gross Domestic Product of that time. We haven’t hit 100% of GDP yet. We can do it too. But not untill we get serious about it.

I would cut out the money politicians are spending on their mistresses.

@YARNLADY – have you ever tried to look for work when you’re working 40+ hours a week?

@laureth Yes, I was in the workforce for about 20 years, including through the recessions 1970 and 1973–75. During those times I was actively looking for a better job than I currently had, and in the early 1970’s I also went to school full time, in addition to working full time.

In the 1960’s I dropped out of the work force, and the rat race and became a hippie for a few years. I never got into the drug part of it, but lived in a commune for a time, and worked with a co-op for a couple of years.

I’ve found it to be true that looking for work while working a regular job is much harder than doing so without. It cuts down on the time you have to spend looking, as well as limiting your ability to conduct interviews during the times when most HR managers are at their jobs and want to interview you. When you can’t devote your entire energy to it, the job search can take much longer, ending up costing the government more in “unemployment” benefits, which are (usually) paid for by businesses taking out insurance rather than by the taxpayer, anyway.

@laureth That is so true. I was lucky, because the work I did was very much in demand. I was a bookkeeper and accounting clerk. My job is done by computers now.