What the Government gets Wrong about Reducing the Deficit
I’ll cut to the chase on this one.
Why is it that the only way the deficit seems to get reduced is when taxes go up? Does anyone else think that’s crazy? Politicians will raise taxes on businesses and citizens, then brag about how they’ve cut the deficit. But do we understand how crazy that is?
Imagine your family spends $20,000 in monthly expenses. That would be an astronomically high monthly bill for any normal American family. However, the reason the monthly tab is so high is that your family takes a vacation every month to an exotic destination. The problem is, obviously, this type of spending is taking a big toll on your family’s finances. So what do you do to fix this issue?
The financial solution to this problem is a simple one: you should cut back on overspending and learn to live within your means.
Anyone refusing to live within their means and only spend the money they have would be seen as financially incompetent. But when it’s the federal government, we consider it impossible. Oftentimes, the government has the capability to follow the same financial advice that we follow on an individual level.
Of course, this is only half the problem. The other half is that the projects we are spending money on are ridiculous in the first place. Senator Rand Paul recently pointed out that USAID spent about 2 million dollars to promote tourism in Tunisia. He also has pointed out that the US taxpayer paid hundreds of thousands to teach Filipino students how to fight climate change. I could go on and on about all the meaningless spending our government engages in on a regular basis.
Nevertheless, the government’s only way to cut the deficit is not to eliminate any wasteful spending… Nope, the only way to cut back is to take more.
This is no way to run a society.
