I have been asked to provide specifics as to what adjustments I would suggest in the Federal Budget to get it towards balance. Here are my suggestions. But first, let me predicate my suggestions with a basic philosophical comment. The U. S. Economic System is predicated on the concept that people are responsible to participate in the economic system by getting a job, and earning a wage in order to reap the rewards of consuming goods and services. The government cannot afford to destroy this concept by destroying the incentive to work. Thus, any government program that frustrates or destroys the incentive for people to work for their income to be able to consume is a program that needs to die. My suggested budget cuts are as follows:
1. Delete the Elementary and Secondary Scool Improvement Program (Dept of Education) with a savings of $5.4B
2. Delete the Offices of Innovation and Improvement, Safety and Drug Free Schools, and English Language Acquisition (Dept of Education) with a savings of $2.2B
3. under the Depart of of Health and Human Services, delete The State Childrens Health Insurance Fund (savings of $6.9B), and reduce Medicaid by 75% (a savings of $150B) based on the concept that people should earn income for health care, not live off the American taxpayer to receive it. The 25% remaining would be for those who truly cannot work due to disability. Additionally the program under the Administration for Childrens and Families could be cut in half (a savings of $10B) by setting a limit for families or individuals to be beneficiaries of these programs to four years maximum during their entire lifetime.
4. Under the Department of Housing and Urban Development, cut the Housing Assistance programs by 1/3 (a saving of $10B) setting a limit for families or individual to be beneficiaries of these programs to a maximum of 4 years for their entire lives.
5. Under the Department of the Treasury, delete the Earned Income Tax Credit program (saving of $40.6B), the Child Care Credit subsidy (saving of $34.0B), and the IRS as an agency (saving of $31.1 B, including tax rebates). IRS can go because the Federal Government adopts the Fair Tax as a replacement of the current income tax system.
6. Cut Social Security by 20% (saving of $100B) by restructuring it to include pensions, interest income, IRA distributions, interest, 401K distributions and all other sources of wealth generation during retirement. The goal is to prevent anyone with retirement income from virtually all sources of $100 Thousand per year from collecting any Social Security. Additionally, the ceiling for paying into Social Security should be lifted completely, and should also be collected from all wage/salary/bonus payment sources such as stock, stock options, or all other wealth generating payments to an employee (including directors on corporate boards).
7. Finally, I would adjust the newly established drug program for seniors under Medicare/Social Security to make the program voluntary and reduce participation to only those who need it. Cost savings may or may not accrue to a program revision.
One final comment. I talk to a large number of taxpaying Americans as part of my life’s work. Most of them are appauled and angry that they work hard to earn money for their family’s needs and they also work to improve their skills to increase their earning potential only to watch this Congress of the United States pay more money to people who act irresponsibly.