I feel like I’m stalking Douglas Elmendorf. That’s the name of the number one author on my reading list. But, he doesn’t write mystery novels, cookbooks, or even comic books, and while I’ve never paid a dime for any of his publications, I log on almost every day in anticipation of his latest release. And no, despite being one of the most unassumingly influential people online, he’s not really a blogger. Douglas Elmendorf is the current Director of the Congressional Budget Office.
If you haven’t already, I highly recommend that you make www.cbo.gov a favorite on your web browser. Although the reports they present are packed with information and detail, the overall assessments they provide are surprisingly easy to follow and understand. After all, even though they’re written BY geeks, they’re written FOR congressmen, so everything is in plain English and very straightforward.
That said, and having read tons of financial assessments over the past couple of years, I do have one overall complaint. Most of the CBO’s reports fail to really account for the economic effects on one critical sector: my wallet. While I am very concerned with the current pace of government spending and I appreciate knowing what a proposed bill’s effect on the national debt will be, I think a lot of important people are missing the most important point--we’re paying for all this.
As the 2010 Census form is currently hitting mailboxes across the nation, our government keeps reminding us that everyone counts and should be counted. After all, the argument goes that this is the only way they know where the resources are needed and where the population stands. But if that is the case, why does Congress seem so focused on the laws they want and not the people they are supposed to serve?
In a report to Daniel Inouye (Chairman of the Senate Committee on Appropriations), Elmendorf and the CBO estimate that President Obama’s current budget proposals would amount to a federal deficit of $1.5 trillion in 2010 and $1.3 trillion in 2011. So is that good or bad? While the amount is horrendous, isn’t the fact that it’s going down a good thing? Well, that’s not the point. While 99% of the public discussion focuses on those questions, we’re losing sight of the bigger issue. The deficit is the amount the government can’t afford, but it’s just the tip of the iceberg of what the American people have to pay.
While the deficit numbers get top billing, the real damage gets mentioned a couple of paragraphs further down in the report: “Under the President’s budget, debt held by the public would grow from $7.5 trillion (53% of GDP) at the end of 2009 to $20.3 trillion (90% of GDP) at the end of 2020.” So now what’s worse, being more over a smaller budget or less over a larger budget? To the average American, the term “deficit” isn’t anywhere near as important as the term nobody seems to want to talk about: “revenues”.
Go back and listen to some political speeches of late and you’ll hear them mention “revenues”. In the very report I mentioned above, the President’s budget claims $743 billion in additional revenues from the passage of new healthcare legislation. That’s good right? Well, not exactly. If the government owned some timeshares on a tropical island, maybe. But last I heard, the United States government only really draws income from one primary source: YOU. Their “revenue” is your out of pocket expense through increases in taxes, whether to you directly or to the companies from which you purchase goods and services. Remember, the government can’t give anyone anything they don’t first take from someone else.
Now, while I do lean Libertarian on a lot of issues, I openly admit that we as citizens do need to pay taxes. After all, the government cannot assure the freedoms of “life, liberty and the pursuit of happiness” without cold, hard cash. And I’m a firm believer of the premise, “you get what you pay for”. But how about just a little bit of perspective?
When the city proposes a new tax levy to pay for schools or services, the language usually provides a guide suggesting just how much it will affect property taxes or sales taxes, or whatever source they target. It may not always be exact, but it gives every citizen the means by which they can figure out how much they, themselves will be paying. Each person can then make their own judgment call.
So here’s what I want. From now on, I want the same kind of estimates for state and federal spending. Don’t just tell me about the deficit, tell me what it’s REALLY going to cost me. Break it down as a percentage increase to income tax if you have to, but don’t go spending money on another “bridge to nowhere” without showing everyone paying the bill exactly what that bill will be.
When’s the last time you gave a teenager your credit card without knowing where they were going and what they expected to spend? Are we all okay with giving Congress that same card and trusting they’ll spend wisely? The Constitution makes them count us every ten years, but doesn’t it also make them accountable to us every day in between?