The 2011 Government Shutdown and the National Debt: A Different Perspective

A government shutdown is not the answer to our nation's problems. Neither is destroying our fragile economy with massive spending cuts. The answer is for Congress and the President to meet and come up with a solution to our national debt that is acceptable by all. But. thus far, the Tea Party won't budge.

What will happen if the Federal Government is shut down? Every place I looked for this information, I found information on the 1995 government shutdown. Here is an article published in USA Today on March 18 1996

http://www.usatoday.com/news/index/budget/nbud063.htm

To get an idea of the distance between Obama's budget and the budget set by the House of Representatives, one need look at the continuing resolution for the fiscal year 2011 The resolution is titled HR 1 IH. This resolution has numerous amendments attached to its and thus will consume much time analyzing. It is also known as the Continuing Appropriations Act. This resolution can be found at:

http://thomas.loc.gov/cgi-bin/query/z?c112:H.R.1:

This resolution contains 61 billion dollars in cuts.

I learned from the PBS News Hour that the Republicans realize that they will be blamed if a shutdown occurs. The crucial factor in the blame game is that Obama has been willing to reach across party lines in order to pass meaningful legislation all political parties can accept. According to PBS News Hour, the negotiations over the 2011-2012 budget are taking place among the leaders of both political parties: John Boehner, Mitch McConnell, Harry Ried and President Obama. Hopefully, the Senate will modify the 2011-2012 resolution and send it back to the House avoiding a government shutdown. PBS News Hour also stated that the President determines (to some extent) what government functions are shut down. Over this past weekend, Paul Ryan stated that there will not be a government shutdown.

If you would like to read the whole PBS News Hour transcript or view the session between Judy Woodruff and John Harley, you can find it at:

http://www.pbs.org/newshour/bb/politics/jan-june11/govcuts_02-21.html

So what contributed to the current high national debt? The first answer one would receive today is big government. If one ask for more details one will hear about entitlement programs, the Iraq war, the Afghanistan war and the stimulus packages. Although I agree with these, I add one more item to the list:

Tax cuts pay for themselves only when the economy is strong. When the economy is weak or in a recession, the tax cuts passed in previous years deprive the government of badly needed funds and increase the national debt. The popular method of pulling the nation out of the recession is more tax cuts causing more national debt in the following recession. Hence, the pay-as-you- go rule would provide relief for the government during future recessions.

Imagine where we would be without the huge tax cuts of the past six decades. The tax cuts of all those years amount more than 40% of the government's income. That's at least a 40% shortage (rough estimate) of government income accumulated over the past six decades. Why? Because the pay-as-you-go rule was not applied to tax cuts and tax incentives. If all those tax cuts and tax incentives were paid for, the US would not have a 14 trillion dollar national debt today (assuming that spending did not increase.) But all those tax cuts really hurt us during future recessions because those funds are not available to help our nation out of the recession.

The 14 trillion dollar debt was created because the Federal Government did not have the funds to fight the war on terror nor the funds to boost the economy. If the government maintained it's income instead of reducing it, we would not be in dept to China and Japan. The government income could have been maintained if the pay-as-you-go rule was in effect.

Congress has the power to change this. Congress might have the power to estimate the damage done during a recession by a previous set of tax cuts and tax incentives.

And the very first step in both the House and the Senate is a rule requiring 2/3 of the votes to nullify any internal rule. That would force Congress to apply the pay-as-you-go rule to tax cuts and tax incentives.

Unfortunately the most needy people will bare some burden during a government shutdown.

I'm referring the elderly people (80 years old and older) who used up all their savings and are fully dependent on Social Security. Elderly peoples' Social Security checks may not be distributed until the budget crisis is resolved; medicare may not be adequately funded leaving elderly people without medical insurance This would be deadly for an elderly person undergoing treatment for cancer.

The other problem with the continuing resolution for fiscal year 2011 is that it doesn't buffer the economy. Consequently the economy will lose more than 800,000 jobs; the opposite of what voters want.

The grants to the states are being axed when the state need those grants more than ever before. Look at history. Every time the Republicans was in office, more financial burden was placed on the states by decentralizing programs. The states have been taking on financial responsibilities for Federal government programs over the past five decades. Now the states are being left with no choice but to raise taxes. Why? Because our new conservative government does not have the courage nor the desire to widen the tax base and raise revenues.

The Tea Party and the Republican Party have used the national debt as an excuse to axe programs they consider big government programs. Tax incentives are big government programs that penalize those businesses that don't get tax incentives.

Look at the Planned Parenthood Program. It is in perfect compliance of Roe vs Wade. But the Republican Party and the Tea Party have attempted to axed all funding in an attempt to circumvent Roe vs Wade. This is more than just cutting government spending. This is revenge.