Title: Good Governance is Balancing the Budget
Original CoS Document (slug): good-governance-is-balancing-the-budget
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Created: 2023-06-08 19:18:13
Updated: 2024-07-16 04:34:30
Published: 2023-07-07 01:00:00
Converted: 2025-04-14T21:25:11.184260224
As advocates of a Convention of States, we believe that our representatives should have term limits and not be professional politicians. We also believe that we should have a limited government. The Constitution places some limits on government, but we believe there should be more limits. Our most important belief is that we should balance the budget – not through borrowing, but income (taxes in various forms) and outgo (expenditures). Of all our beliefs, balancing the budget is of vital importance for the survival of our nation. Our national debt is about $30 trillion. That is about $85,000 per living person in the United States. Do we ever hope to pay that back? The interest charges on the national debt are nearly $500 billion. What could we do if we did not have $500 billion yearly interest payment on our debt? Could we prevent Social Security from going into bankruptcy?
Our debt is not sustainable in the long term. At one time we were a creditor nation – we loaned money to the rest of the world. Now we borrow money from the rest of the world and ourselves. China holds most of our debt. Is that a big anchor around our neck? What if China were to call all our debts due and then unleash those dollars into the world? Prices would sky rocket. Everyone understands what happens when a household has too much debt. We must limit our spending until we retire the debt so that interest payments get down to zero. Debt is supposed to be a temporary situation. If you buy a car, you pay the debt off within three years. If you buy a house, you pay the mortgage off within 15 years. Debt is necessary, but transient. The interest you pay must be less than the benefit you gain by using borrowed money. It is just common sense. Apparently, the government has no common sense. The government borrows money to buy votes. We, as Americans, must pay for that folly. How sensible is that?
Where does the money go? Primarily it goes to buy votes. When we get a check from the government, when the government builds us a new road, when the money is dispersed in welfare checks, food stamps, Medicare and when people are paid not to work, then we are beholden to the government and are more inclined to vote for more benefits – and, we the people, pay for that nonsense. The situation is like you paying taxes so that the political parties can use the money to convince you to vote for them. How ludicrous is that?
Assume you are making a budget for your household. You put in expenses that you feel will come up for the month and allocations you make for long term debt reduction. You look at your income and see if it matches your outgo. If not, you cut back spending, increase your income, or temporarily borrow money to cover the shortfall. One of your expenses should be to create an emergency fund, usually 3-5 months’ worth of projected expenses. Most people (and the government) depend on credit for this emergency fund. The problem with borrowing money is that you have to pay it back with interest, which creates a squeeze on the cash you have to spend in any given month.
The government is different. It can print money to pay back its debts. Of course, inflation is the price we pay and the result is paying back our debt with inflated (less valuable) dollars. The people who hold our debt hold an inordinate amount of influence over government and private actions. A company that sells stock, sells debt. People who hold that debt can make demands on the company’s actions. For instance, an investment company who holds a controlling interest in the stock of a company can force that company to subscribe to Environmental and Social Governance (ESG); Diversity, Equity, and Inclusion (DEI); and environmental policies. Now you know why companies are signing on to these programs. The influential elite, who hold the company’s debt, are demanding that companies subscribe to these policies.
Any budget must prepare for emergencies – again, common sense. How we intend to handle these emergencies is left to the administration who makes out the budget. How you balance the budget is left to the President and to Congress. The President’s job is to propose a budget and the House of Representatives’ job (working with the President) is to agree (or disagree) with the budget, propose changes as necessary and come up with the financing that will meet the budget requirements. Lately, the House of Representatives has agreed to increase the debt ceiling (allowing the government to borrow more money and increase taxes) to meet the President’s proposed spending follies – all for non-emergency spending.
Emergencies are unplanned events that happen when you do not expect them to happen. Emergencies are also declared at the whim of Presidents and Congress. Any budget allows the means to fund an emergency. The problems comes when the President can declare an emergency to get his way, which opens the door for more borrowing. Congress has the means to negate that emergency, but has not had the fortitude to do so. One way to handle emergencies is to define what an acceptable emergency is or to have Congress do what it is supposed to do – decide if the President’s declared emergency is really an emergency.
The real problem is that, we the people, have not chastised the government for not declaring or publishing a balanced budget (income and outgo with no borrowing) and hold them to the performance of that budget. In a democracy, people hold the power of the purse strings. In a republic, the elected representatives of the people, who are supposed to be wiser than the general public, are to hold the line on spending. Our representatives, unfortunately, are more concerned about getting re-elected (buying votes) than they are about representing the interests of the people.
We the people are responsible for the actions of those we elect. Their failure is our failure. We fail to hold our representatives responsible for their actions. If we are not happy with how our country is behaving, then we need to throw the rascals out. As someone once said: “We have met the enemy and they are us.” A balanced budget (income and outgo with no borrowing) is one of the pillars of good governance.