Senator Pat Toomey's Balanced Budget Proposal

My senator from the great state of Pennsylvania has put together a budget proposal.  I have to say that I am proud to have Pat Toomey as my senator.  Senator Pat Toomey's budget simplifies the tax code, balances the budget in nine years, and reduces the publicly held debt from close to 70 percent of GDP today to 52 percent by 2021.  He does this by reducing the spending to 18.5 percent of GDP.  He decided to focus on one thing at a time, first proposing a balanced budget but he does know and understand that social security needs to be reformed.  Overall, I have to say that I am pleased with his budget proposal.

Here are the cosponsors of the Budget Proposal:

Cosponsored by Sens. Jim DeMint (R-S.C.), David Vitter (R-La.), Tom Coburn
(R-Okla.), Richard Burr (R-N.C.), James Risch (R-Idaho), Marco Rubio (R-Fla.), Ron
Johnson (R-Wisc.) and Mike Lee (R-Utah)

Pat Toomey states:


Let me just mention one other thing. It's my view that a permanent solution to the
fiscal challenges that we face will require broader reforms than what we have in
this budget. For instance, ultimately, we need to reform the Social Security
program; we need to reform Medicare. But this budget represents what we think of as
a necessary first step. It reaches balance. It does so within the foreseeable
future, within 10 years in fact, and in the process, I hope that it will demonstrate
and earn for us a restored trust in our ability to grapple with the big problems
that we face. This in turn, will buy us the time we need for the long-term reforms
for our federal budget.

I'm not aware of any country that has ever dramatically grown its government,
generated massive spending beyond its means, run up huge deficits, accumulated
massive debt, monetized part of it and then lived happily ever after. We won't be
the first. We're either going to stay on this current path and suffer the
consequences that will come from this very irresponsible spending - the consequences
of diminished opportunity at best - or we're going to depart from this path and
adopt the fiscal discipline that our constituents expect of us and adopt the
pro-growth reforms that will allow our economy to recover and allow us to enjoy
another great American century.

The time to choose is now. And the time is running out.
 

Here is an overview of Sen. Toomey's balanced budget proposal.

1 Pager- Balanced Budget Resolution FINAL

Here is a more detailed overview of Senator Toomey's balanced budget proposal.

Restoring Balance Final

Who Is Actually Doing The Taking?

In this video President Obama talks about the wealthy or the entrepreneurs "taking". Taking from who? The entrepreneurs are not taking from anyone. If entrepreneurs are successful and earn their own wealth they are not taking money from anyone. Obama's argument is so illogical. The Federal government is the one that is taking, taking the money from both the entrepreneurs, poor, and middle class folks. And, for what? Failed programs?





Here is a chart which shows how Congress has spent money from 2006 through 2010.

Here is a chart which shows the money that comes into the government from income taxes, corporate income taxes, social security and payroll taxes, excise taxes, Estate and gift taxes, customs duties, and other (not sure what other consists of), and the money that is spent by the government.

Do you see that between income taxes and Social Security and Medicare taxes the government takes from us  over $2 trillion.  If you take a look at your paychecks you will see lines that say Federal Income Tax, Social Security Tax, Medicare Tax, and then you have your State taxes.  In those columns you see a negative sign. This was originally your money, this is money that you have earned and that the Federal government takes from you in order to use it for the various federal programs.  This could be money in your pocket but Big Government GREED takes your money to spreads the wealth. So, who is doing the taking?  Plus, the government has just added Obamacare - a huge entitlement program - which will cost Americans more money than the President has predicted, and give will you, the consumer, less choices related to your health care.  Plus, the death tax returned thanks to the Democrats.  So, now there will be a 35 percent tax on property and items being passed onto the children of the dead which will create some additional revenues for the federal government.  Nothing like taxing one's property and possessions after you gone off to the Great Beyond.  This is yet another way for our progressive government to penalize the successful and steal their money and property.  This is another one of the liberal initiatives to screw the future of America.

Between Medicare, Medicaid, and Social Security the Federal Government spends $1578 billion.   The Federal government takes in $1578 billion from taxpayers to pay for these programs.  Where does the government get the money to pay for these programs?  From taxpayers like you and I.  Who gives this money to the poor and elderly to help pay for these programs?  Taxpayers.  So who is really doing the taking?  Is it the Federal government?  YES.  The Federal government takes money from hard working taxpayers to help the less fortunate.  But, the taxpayers DO NOT TAKE FROM THE GOVERNMENT OR THE POOR!!

Our government takes in $2.57 Trillion and yet it cannnot stay within its own budget.  This out of control Washington spending dishes out close to $4 Trillion, which is around 1.25 Trillion dollars more than it takes in from taxes.

We need to make some serious spending cuts. We may even need to make some tax increases, but that would only be a last resort.

Since Obama keeps on saying that everyone needs to share the pain, (even though he really believes that the poor shouldn't bear any of the pain), I have an idea, Let's return to the spending levels of 2006. In addition some departments may need be cut even though their spending may not have increased that much or not at all.

 Here is Teresa's fiscal plan:

Looking at the chart we would subtract 230 Billion dollars from the Health and Human Services Department.

We would end this nonsensical non-war in Libya and cut Defense Department spending by 175 billion dollars.

The Treasury Department actually looks like it spends less money than in 2006 so let's decrease that by 5 percent which would be approximately $2.25 billion.

The Department of Agriculture needs to be cut by $65 billion.

Since education spending levels were lower in 2007 and 2008 then in 2010 and 2006 the departments funding should be reduced to 2007 levels which would decrease their funding about $50 billion.

Veterans Affairs funding would be reduced by about $35 billion.

Department of Homeland Security spent the highest amount of money in 2006 so I would decrease funding for them by about $15 billion.

The Office of Personnel Management would be reduced by about $15 billion.

The Department of Transportation's funding would be reduced by $20 billion.

The Department of Justice would be reduced by about $15 billion

The Department of Energy would be reduced by $20 billion.

NASA would be reduced by $2 billion.

International Assistance Programs would be cut by $10 billion

Other independent agencies would be cut by a total of $35 billion.

Department of State would be cut by $10 billion.

Department of Interior would be decreased by $4 billion.

The Environmental Protection Agency would be decreased by $10 billion.

Corps of Engineers funding would be decreased by $3 billion.

Department of Commerce would be decreased by $8 billion.

National Science Foundation funding would be decreased by $8 billion.

The Legislative Branch funding would be decreased by $8 billion.

I wouldn't touch the funding for Executive Office.

My total reductions would be $740.25 billion right off the bat. There would be no phasing in for these reductions.

Then we would have to tackle the high costs of medicare, medicaid, and social security.  But, that I will do in a later post.

Two economists, each on opposites sides of the aisle, agree on raising the age for social security and reducing defense spending.




I agree that the age to receive social security should be raised and that the budget for defense spending should be reduced.  I also think that the cap on wages for contributing to social security needs to be lifted.  I don't think that those earning above the cap should contribute at the same rate as those below the cap but maybe 1/3 the tax rate that those below the cap do?

Also, I am so sick of these rich progressives complaining about their ability to give more money to the government but not doing this of their own accord.  President Obama didn't pay more than his allotted amount for taxes.  If he and others wanted to feel more patriotic as Joe Biden says or that it was their duty to pay more in taxes why don't these people just write out that paycheck for the additional funds?  Why do they need the government to tell them the amount they additionally owe as well as forcing other Americans to pay more money?

Does Obama not think that serving in the military and being willing to sacrifice your life should afford you certain benefits?  A GI Bill is a small compensation considering that person could have lost his or her life.  Did Obama's grandparents not contribute to both medicare and social security before they received benefits?  How did this affect him as a person?  How did he "take" as he put it?  His misconception of how the world goes round and how people earn their wages is quite disconcerting.  Wealthy persons who create jobs did not take from the government.  They take out loans from banks and pay them back and if the persons don't pay on their loans they will go into bankruptcy.  Wealthy people are the entrepreneurs of this country giving others the opportunity to have jobs.  The vast majority of job creators get taxed just like you and I do (except big companies like GE, Verizon, and AT&T) which means the government - Federal and state governments  - take money out of our paychecks.  Unfortunately, these big companies use tax loopholes to pay no taxes. Our tax code needs to be changed so this isn't able to happen.

So, who is the taker of wealth in this country? The wealthy job creators or the Federal government?

My answer is the Federal government.

Obama is Kicking the Can Down the Road but is GOP Kicking Smaller Can Down the Road Too?

The Obama budget is a fiscal joke, or a fiscal nightmare for our future.  The American people sent a message loud and clear to Congress and President Obama on November 2nd and it is obvious that he didn't get it.  


Senator Jon Kyl points out that Obama's budget adds nearly $13 trillion in debt by the end of the decade and the gross debt will reach $26.3 trillion by the end of the decade - which is 107 of gross domestic product.


 Senator Kyl says that: 
"The debt will eclipse the size of the entire economy." 




The United States will have a mega-financial disaster on its hands, which will look much like Greece does today.  


Sen. Kyl states: 


 "That’s a gloomy outlook, and it would be prudent to stop raiding the treasury. But, not in this budget. Under President Obama’s budget, the size of the federal government will nearly double since he took office. Over the next 10 years, the President proposes $8.7 trillion in new spending, with $46 trillion in total spending. Spending in this fiscal year is projected to be a record $3.8 trillion, or 25.3 percent of gross domestic product, the highest spending-to-GDP ratio since World War II!" 


I agree with Sen. Kyl.  This is a gloomy outlook.  This type of financial disaster can be avoided if President Obama, the Democrats, and the Republicans have the will and listen to the American peoples' voices which were spoken loud and clear in the November elections.  


The Obama budget would increase taxes on families, small businesses, and job creators at a time when  our economy is still very fragile.  How does raising taxes on small business owners and other job creators encourage businesses to hire new employees?  Simply put, it doesn't.  It decentivises the job creators from opening up new stores and hiring new employees.  It is a real possibility that their will be layoffs due to Obama's fiscal insanity. With this kind of backwards mentality of penalizing the backbone of our country - the entrepreneurs - in the near future I can see the unemployment rate rising above 10 percent. 


  But, does the GOP get it?

The GOP seems to be waving the white flag of compromise and giving into the Democrats.  Most of what is in the GOP's Stop Gap proposal consists of cuts which were already proposed by Obama and the Democrats.  The GOP is acting very weak and are compromising to avoid a government shutdown.  I am all for a government shutdown.  What has the government done right in the past few years?  The government has expanded like a huge balloon full of helium and it needs to be popped and shrunk down to a much smaller, acceptable size.  The Federal government has invaded our lives, like an invasion of aliens from outer space.  This ever expansive government needs to be reigned in and if it takes a government shutdown to save money and show the Democrats that we want to save or country from fiscal ruin, so be it.  The dynamics of our economy is different than in 1995 and there are more people who are more aware that the United States needs to get its fiscal house in order.  


The GOP didn't even have the will to cut at least $100 billion from the budget, as they pledged to the American people in November.  The House approved $61 billion in spending cuts and the GOP can't even stand on principle and put pressure on the Senate to pass those cuts.  This is unacceptable and makes me furious. We definitely need to boot some RINO's out of the GOP.  These compromisers need to go.  I am sick of the GOP being more worried about their political appearances than solving both our budget and deficit woes.  


So, sadly I have to say that more than a few in the GOP don't get it.  They are indeed kicking the can down the road, albeit a smaller can than the Democrats.  But, this should not be the barometer we use to judge the GOP. They must have had some serious wax in their ears during the November campaigns.  Or, maybe they have had amnesia?  Their actions and words are evidence that we need to remind them consistently and often of the will of the American people and what this country needs in order to get its fiscal house in order.