Government Which Governs Least
I’d like to try something a little different. I’ve tried to research material to address different aspects of the political environment that are starting to become factors in the world in which we find ourselves today. I did one article regarding the healthcare issue, where I probably included too much personal information. I wanted to attempt to put together an article that gets us refocused on the purpose of the site, and that is COMMON GROUND!
The one thing that sticks with me the most about the posters on this site is that you are all passionate in your beliefs. Unlike so many sites in this anonymous world called the internet, we have actually been able to forge friendships, however fragile they may be at times. For those of us who have been fortunate enough to meet in person, from what I’ve heard on all accounts each and every one of these meetings has reinforced opinions that folks here are rock solid! This is quite a remarkable feat no matter how you look at it. Sadly, sometimes I think we lose sight of that simple fact in our discussions. So what I’d like to do with this article is to take my personal observations of our discussions and see if we have more in common than we have differences. I know we all realize that there are some major problems that we face together - where the disagreements come is in the solutions. Here are my simple observations.
The first issue that we have is our differences of opinion on the role of government in our lives. Some feel the federal government should be the dominant factor, others believe the states should be. If you look at it strictly in terms of our Constitution, the sederal role is to be limited and the states are to be dominant. I don’t think that anybody can really argue the opposite honestly. Everybody realizes that government is a necessary evil in our lives, simply because without it we would be living in anarchy and nobody wants that (except anarchists). The real question is how do we get back to a proper balance and still benefit the entire country, not just certain segments.
We’ve all heard the phrase “government which governs least governs best”, and there is a reason that rings true. It places the individual in charge of doing the “right thing”, even though there is little oversight. When I go bowling on league nights, I drive on rural roads, with stop signs and stop lights. I come to a complete stop when I get to a stop sign, and I wait for the light to change even if there is no traffic. Why do I do this? Quite simply because it is the law, it’s part of the rules we live by. I don’t think there is anything unique about me in this respect, I think most people are capable and willing to do the same thing for the same reason. There is a trust, a bond if you will between government and the citizenry to obey the law even when nobody is watching. Somewhere along the line, that trust has been lost in both directions of governance. I suggest the following for your consideration.
Due to the nature of our budget difficulties hitting us at the federal, state and local levels, the elimination of all unfunded mandates should be discontinued, for one simple reason. If legislation is so important that it needs to be passed, it should be fully funded by the level of government passing the legislation. It’s easy to spend other people’s money when there are no consequences. Try having something forced on you in your own personal life by any entity and you’ll take issue with it. This simple step could remove a huge burden from every level of government other than local. That’s the way this system of ours was designed to operate.
The second step of this process would be to eliminate duplication in the various federal agencies involved in so many aspects of our everyday activities. We really don’t have to look too far back in history to find an example of how this interferes with a reasonable and timely response to a problem. I give you as an example the Gulf oil spill. There were numerous stories about how the various federal agencies each had their own specific spans of control. Because of all the layers of government involved, steps that could have been implemented quickly to minimize damage were delayed simply due to layers of bureaucracy. It slowed our response considerably. Why have seven different agencies involved in the decision-making process in this emergency? If your house was on fire, would you want to have to get the okay from seven different people before the fire trucks were dispatched? This is the easiest example to use, and it’s rampant in every layer of government.
Once that duplication has been eliminated, we then can focus on what the federal government should be involved with, and this is where it all gets very tricky. There is an argument to be made that some standards need to be applied across the entire country, and in some instances I agree that it is necessary. For this example I will use the Department of Education. I firmly agree there should be a basic set of educational standards, but none of them should involve diversity training, sex education or self-esteem classes. Those are not issues that should fall into the realm of government at any level, in my not so humble opinion, but rather to the parents. What purpose does it serve the citizenry for a child to feel good about herself when she can’t even read the diploma she is handed? At some point we have to get back to parental responsibility. Many of us were born and raised before the Department of Education was created in 1977. Think of how much has changed in the US during the subsequent three decades. It’s mind-boggling when you take the time to contemplate that. As a small aside, the Energy Department was created at the time to make us energy independent. Anybody honestly think it’s even gotten close to that goal?
These are all things we have discussed here, time and again. When you take the time to stop and ponder just these simple steps, do you understand the amount of money these simple steps would save? State and local governments could implement the same principles, and the savings would be compounded further. A profound attitude change would occur from both the perspective of the taxpayer toward the government, and vice versa. It’s all quite simple when you think about it. Most taxpayers don’t mind paying taxes, and they really don’t mind government. Where the real conflict arises is when the taxpayers don’t think they are getting their money’s worth out of THEIR investment. Government doesn’t invest in infrastructure and schools, taxpayers do.
It’s The Spending, Stupid!
There is a quote that keeps being repeated on this board which seems to miss the point being made by the voters in the 2010 midterm elections, that as Alan Greenspan has commented, “Spending has become untouchable” [1]. Perhaps to the politicians it has, but to the population as a whole, perhaps not so much. The only question I have is whether or not the public actually realizes how deeply the federal government is involved in the everyday funding of the United States economy. This isn’t something that just came into being during the Presidency of Barack Hussein Obama (hmm, hmm, hmm) (sorry, couldn’t resist the urge), but it has certainly taken a leap forward. It’s no longer a question of whether spending needs to be curbed, it’s a question of how much and how fast. It’s a dilemma decades in the making, and one which would have Solomon awakening in cold sweats! Let me provide a small step toward a solution.
First, we need to have a true understanding of the problem we are facing. In 2000, the Federal deficit stood at almost 5.7 TRILLION dollars, a staggering amount [2]. However, as the link shows, it has increased at a staggering pace over the last decade. I would suggest that the cost of two wars and an extravagant prescription drug entitlement (among other things) during the Bush Presidency had much to do with the increase (and I’m NOT making an excuse for this). Many conservatives have caught Holy Hell for saying that Bush wasn’t a conservative. He WASN’T a conservative; he was cut from the same cloth as his father. As Texas as Bush Junior wished to portray himself, he was more a product of the upper east coast upbringing he received. Bush Sr. despised Reagan for his conservatism, and in many ways gave the left in this country many talking points in their battle with Reagan’s policies. The left in this country weren’t clever enough to come up with the “voodoo” economics phrase, which came from Bush Sr. during the primary, and they rode the wave for 8 years until Bush Sr. became President. It was astounding to watch those in the media that praised Bush for his stance against Reagan, then paint him as a staunch supporter of Reagan’s policies. I’m not even going to bother with the ads - if you’re interested, do some digging! For me, give me more voodoo economics because this “new normal” isn’t cutting it!!!!!
The Office of Management and Budget has a rating system that measures the effectiveness of federal programs [5]. The most recent assessment found that 20% of federal programs are not performing - are either ineffective or cannot produce demonstrable results. The estimated spending associated with these non-performing programs is far in excess of the $100 billion Republicans have suggested they can eliminate during the first year of the new congress. If the OMB can come up with THAT much waste, just imagine what somebody who doesn’t have a dog in the hunt would come up with!
I am of the belief that a majority of the American people know exactly what they expect of their government. The only question that remains is whether the ruling class has the courage to do what is necessary! Change in the behavior of our elected officials will not come about without some political discomfort, and many politicians have ridden the gravy train for a very long time. It is far past time they put the future of the country ahead of their own re-election, and the goals are not mutually exclusive!
There have been a number of suggestions that have come forth concerning federal spending, but the only ones I have seen that don’t re-spend the “saved” money come from the conservative mindset [3][4]! Feel free to criticize the recommendations, but without an alternative, what do we have? The left and right may have similar goals for our country, but the question remains, how do we achieve them? The politicians on BOTH sides have cast their lot for the last 100 or so years, and their collective ignorance has brought us to where we are today.
If anyone thinks you won’t see a replay of Europe here in the States over budget cuts, consider the developing story of a possible intentional union slowdown in dealing with the New York area’s snow problem in recent weeks, at the cost of lives, mind you. If these charges are proven accurate, this should give you pause in any steadfast support of these organizations and any federal support and favors they receive.
[1] http://www.realestatenewsutah.com/news/alan-greenspan-henry-paulson-economy-19496
[2] http://www.treasurydirect.gov/govt/reports/pd/histdebt/histdebt_histo5.htm
[3] http://www.downsizinggovernment.org/
[4] http://www.heritage.org/Issues/Budget-and-Spending
[5] http://www.whitehouse.gov/omb/expectmore/rating/notperform.html
Time to Repeal Davis-Bacon
We are today facing an economic slowdown, I believe we can all agree on that simple fact. While each of us has an opinion as to whether government can effectively create jobs, there is no question that we all wish to have our tax dollars spent wisely. During President Obama’s first term, there has been much debate over the veracity of the jobs created/jobs saved figures. That is not the purpose of this article.
Working as a purchasing agent in the State of California for the last eight years and in the electrical business for the last 15, I have extensive experience with the issues facing owners in the electrical construction business. While working in the wholesale segment I learned the maximum profit I could extract from the contractor, while still retaining their business. As a supplier, I found myself conflicted between attempting to generate a profit for my employer and maximizing customer satisfaction, which included pricing which allowed them to generate a profit as well! It was an incredibly cutthroat business, where the difference between getting an order and not sometimes amounted to as little as $1,000 on a $50,000 order. The way we competed was generally on service level. The customer’s deadline became our deadline! With lead times and other uncontrollable factors impacting our ability to perform, sometimes it was rather difficult to achieve goals that were set. Working well into the evening several nights in a row in order to meet deadlines was not unusual. This caused a great number of “butting heads” moments between myself, management and sales staff. I NEVER missed a deadline. But that isn’t the purpose of this article either.
The purpose of this article is to discuss the labor rate charged for government funded programs throughout this country. In the contractor segment of the electrical business, I have been exposed to what is referred to as the “prevailing wage”. It is not unique to the electrical business, but it is central to the differences between private and public projects in this country. The driving factor is the Davis-Bacon Act of 1931. When passed, it was designed to stop minority non-union labor from being able to “unfairly” compete with higher paid white workers. While today it is hard to comprehend such an Act passing, it was reality in the 1930′s. However, as with so many other regulations, today the Davis-Bacon Act has consequences unintended when passed. It determines wages paid to any worker that participates in a federally funded project. Despite my personal belief that quality should come first and be the primary driver for wages, Davis-Bacon makes quality irrelevant. Davis-Bacon guarantees the “prevailing wage” will be paid on federal construction projects, meaning wages must follow union scale in any area that is at least 50 percent unionized, regardless of the quality of work. A personal example may help to illustrate why Davis-Bacon needs to be repealed.
I live in what is considered the fruit basket of the world, the San Joaquin valley in central California. Pick your crop folks, we grow it! Almonds, tomatoes, artichokes, lettuce, asparagus, walnuts, cherries and yes premium wines and table grapes. The packing sheds out here hire an incredible number of legal (and illegal) immigrants. People line up by the hundreds to secure jobs with these facilities – you would be stunned!
Not long ago, one of the sheds needed to build a cherry line in order to meet increased demand. As it was a privately-owned company that received no public funds, they were not required to pay the prevailing wage on the project. It was a massive undertaking and one of our best electricians was assigned the job. As the “parts guy”, I was involved from the beginning and listened to the electrician lament how it was a private job and that he wouldn’t be paid prevailing wage. We billed $60 per hour and paid the electrician approximately $35; a prevailing wage job would have billed at $85 per hour and paid the electrician $55. He reluctantly agreed that the lower wages were better than not working at all, and I predicted that by the time he finished the job he would be taking pictures and crowing like a proud new father! The job took 6 months of 40+ hour weeks and overtime was paid. Needless to say, by the end of the project he was there with video camera in hand, displaying how the line worked! He had indeed become a “proud poppa” crowing over his newborn child.
The point of this post? I guess that in looking for ways to cut government spending, the Davis-Bacon prevailing wage statute may not be a bad place to start. From my experience, the majority of contractors working in this field started by slinging tools themselves and they know what it’s like to try to eek out a living. There is plenty of work available for all contractors without entrenching the businesses that choose to become union shops. With both state and federal governments trillions of dollars in debt, isn’t it time to reintroduce the free market into our bidding process?
http://www.cato.org/pubs/briefs/bp-017.html
Health Care: Which Path Shall We Take?
I’ve always loved the holiday season. Thanksgiving, Christmas and New Year’s are truly some of my favorite times of the year, but they bring about a curious blend of emotions. Whether it’s being thankful for what I have, the joy of sharing my good fortune with those less fortunate, the reflection on the past or the hope of the future, this season uniquely awakens my soul!
This year is unique for the country in many ways, as we haven’t been challenged like this for quite some time. (more…)
The Gipper
I have noticed over the last couple of weeks on this site the increased mention of former President Ronald Reagan and the negative impacts of his economic policies on various aspects of the United States economy. I was a 24 year old young man when Reagan was elected, and remember very well the economic conditions that were at play when he was elected. So I came to an agreement with Mr. Galt that I would do a piece on the effects of the Reagan tax policies. I made a commitment to myself to keep my personal opinions out of the piece, and to instead focus on the numbers involved. I wanted to endeavor to put together an article that was as honest as I could. I did not wish to make it a slanted, one sided article because I believed I owed that to you all. As I have come to be associated with you all there is an underlying theme, we all care about our Country a great deal. I am going to focus on four central themes, 1) The revenue generation of the Reagan tax cuts, 2) the effects on the manufacturing sector of our economy, 3) the generation of wealth the policies created and 4) the effects on the Federal deficit. (more…)
Gregg: The Public Employee Pension Tax, Part II
In my previous post I identified a major problem looming on our financial horizon in the form of public pension underfunding. While it is quite easy to identify a problem, the solution is not always so apparent. I guess it’s time to roll up my sleeves and attempt to offer one.
A Defined Contribution Plan (DCP) was also created with the enactment of the ERISA legislation. These are the 401k and IRA accounts so many of us own. There are certain advantages to these plans over Defined Benefit Plans (DBPs). First of all they are portable, which means if you change employers the funds can move with you. In addition, YOU are directly involved in the investment decisions, so you can tailor them to your personal situation. There are also advantages to the employer in that their obligation is funded almost immediately, which removes any future debt service obligation, and their contributions are a percentage of employee contributions and are not impacted by investment returns. The accounts themselves, however, are subject to the fluctuations of the market, and as we all have seen returns are not always positive. (more…)
Gregg: The Public Employee Pension Tax
When John Galt read one of my posts concerning labor unions, he suggested perhaps it was time to write another article. I readily agreed, but thought I would be clever and write one on pensions instead. Once again, the old adage, “No good deed goes unpunished,” has come true. While I had some idea there was a problem looming on the horizon, what I discovered stunned me.
To begin with, a little background on pensions in the US. The first private pension plan was created by the American Express Company in 1875. By 1930, most large companies offered pension plans and most survived the Great Depression. The ones that failed were the ones funded under a pay as you go system, where benefits were paid out of current earnings rather than funded reserves. The Social Security Act of 1932 began the growth of state and local government pension programs. Pension plans expanded with the Wage and Salary Act of 1942, which was instituted to freeze wages in an effort to curb inflation. Pension benefits were added as an incentive to attract workers when wages could not be increased. (more…)
Gregg: A Return to Virtue
“A general dissolution of principles and manners will more surely overthrow the liberties of America than the whole force of the common enemy. While the people are virtuous they cannot be subdued; but when once they lose their virtue then will be ready to surrender their liberties to the first external or internal invader.”
Samuel Adams, letter to James Warren, February 12, 1779
While attempting to resolve myself to the actions of the current administration and the declining morality exhibited by leaders such as SC Governor Sanford, I reflect on how it is we find ourselves in the current situation. While it is evident that we have had erosions in our foundation over the years, I find myself increasingly returning to the era of the Vietnam War. With few exceptions, it was indeed one of the most turbulent times in this Republic’s history. There were violent anti-war protests and racial strife following the assassination of Dr. King. Significant as these actions were, there were other issues from that era which I believe helped set the stage for our current situation. (more…)
