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Many Americans (myself included) have been wondering whether Mr. Obama would recognize the size and scope of the “shellacking” Democrats just endured and move to the center as a result. QE2 is perhaps the clearest answer that this administration will continue to pursue its agenda, regardless of public antipathy. Fed board member Kevin Warsh undescores the irresponsibility of that agenda: ”The Federal Reserve is not a repair shop for broken fiscal, trade, or regulatory policies.”
So what should Mr. Obama be doing? Exactly what he promised to do in the opening paragraph of this piece. And if he needs any help, he could revisit an extensive analysis of government spending already undertaken once before. In 1984, The Grace Commission report was presented to Congress. According to its recommendations, “$424 billion could be saved in three years, rising to $1.9 trillion per year by the year 2000.” Furthermore, it concluded that as much as one third of all incomes taxes collected is consumed by the federal government’s “waste and inefficiency” and another third “escapes collection” due to our underground economy.
Even more revealing was this statement:
With two-thirds of everyone’s personal income taxes wasted or not collected, 100 percent of what is collected is absorbed solely by interest on the Federal debt and by Federal Government contributions to transfer payments. In other words, all individual income tax revenues are gone before one nickel is spent on the services which taxpayers expect from their Government.
And that was back in 1984. For perspective’s sake, consider federal expenditures for 1985, ’86 and ’87 from which the Grace Commission’s $424 billion dollars in savings would have been produced: in 1985, the feds spent $946, billion. In 1986, it was $990 billion. And finally, in 1987, the federal government spent $1.003 trillion dollars.
Thus, the total outlay for those three years combined equals just under three trillion dollars. This year alone the federal government has spent almost four trillion dollars.
Even if one assumes that the current budget, which is twenty five percent higher than the combined totals for the three years cited above wouldn’t yield a single penny in additional savings, is it unreasonable to assume the identical $424 billion could be lopped off the current outlay?
I suspect Americans didn’t hand Republicans 61 seats (and counting) in the House of Representatives and 6 in the Senate in order to re-arrange deck chairs on the Titanic wreckage our federal government has become. The Grace Commission Report could be a great source of information as to the most effective means of bringing this country back to fiscal sanity.
Take it out of mothballs, Republicans. The country you save could be your own.
Arnold Ahlert is a contributing columnist to the conservative website, JewishWorldReview.com.