By Dan Beaulieu
As most of us know Presidential front-runner Ron Paul has released a spending plan that will cut $1 trillion in government spending his first year in office. The plan essentially reduces the size of government back to 2006 levels and promises to balance the budget by 2016. I’d like to take readers over what his plan means to us as American citizens.
“Cuts $1 trillion in spending during the first year of Ron Paul’s presidency, eliminating five cabinet departments (Energy, HUD, Commerce, Interior, and Education), abolishing the Transportation Security Administration and returning responsibility for security to private property owners, abolishing corporate subsidies, stopping foreign aid, ending foreign wars, and returning most other spending to 2006 levels.”
Regarding the departments his plan eliminates (Energy, HUD, Commerce, Interior and Education), a simple Google search would unveil the tremendous waste and inefficiencies they produce. For example, let’s take the Department of Education, which was instated in 1979. Taxpayers pay around $100 billion per year to the Federal Government for them to simply send it back to the states, well not all of it comes back we waste roughly 10% in administration. Although the DOE was created to raise test scores and provide the best education possible. Since its creation our tests scores have plummeted over 30% in some fields, at $25,000 per student it’s safe to say... this money can be spent more wisely.
We are all familiar with the atrocities committed by the Transportation Security Administration [TSA], between diaper searches, groping of genitalia and an overall thuggish attitude all Americans should be furious with this tax funded program. However, many American’s justify this behavior as a necessary evil to ensure security. Ron Paul’s philosophy is “if a private company can secure the transportation of millions of dollars across the country, why couldn’t a private company secure the transportation of people?” essentially encouraging private enterprise to take over airline security. Let the airline’s hire private companies that specialize in security and surveillance and we’ll keep our tax dollars. The CIA can assist these companies where National Security comes into question by monitoring international travelers. America, we don’t have to trade our personal freedoms to be secure.
One of the most curious things is that even in our current state of economic crisis, rising food prices, foreclosed homes and unemployment at depression levels, we still manage to find it within ourselves to invade other countries and prop up future dictators. Our foreign aid involves taking money from the lower and middle classes here in America and giving it to rich bureaucrats in 3rd world countries. It should resonate as absurdity when one finds that we often fund both sides of a war, at the same time our country has families starving, we have businesses here that can’t afford to operate and we have protesters in the street, maybe it’s time to end this. Ron Paul calls for the end of all overseas spending on militarism and I believe most Americans would too if they really understood why we are over there. It’s not about terrorism and it’s not about “helping” the people of those countries. It's about large corporations and greedy people making money.
With these government cuts comes some inevitable Federal job loss. Ron Paul has taken this into consideration and has created a system where these jobs are phased out rather than slashed immediately. Keep in mind, it is impossible for government to make a job without taking one from the private sector (read Henry Hazlitt). That said, the smaller the Federal Workforce the larger the private sector work force. Private sector jobs are more integral than Federal jobs to a strong economy as the private sector are the producers.
“Honors our promise to our seniors and veterans, while allowing young workers to opt out. Block grants Medicaid and other welfare programs to allow States the flexibility and ingenuity they need to solve their own unique problems without harming those currently relying on the programs.”
This is fairly self-explanatory, Ron Paul will honor the promises we’ve made to our veterans and to those who have been paying into social security. Other entitlement programs will be phased out without harming those currently relying on the programs. Keep in mind that Social Security was projected to run out by 2024, so Ron Paul is the only candidate with a solid plan to fix that issue for seniors.
CUTTING GOVERNMENT WASTE:
“Makes a 10% reduction in the federal workforce, slashes Congressional pay and perks, and curbs excessive federal travel. To stand with the American People, President Paul will take a salary of $39,336, approximately equal to the median personal income of the American worker.”
This is only to expected from a man like Ron Paul who, unlike 90% of other Congressmen, has never accepted a Congressional pension, money from lobbyist or any other government junket to the tune of millions of dollars. Ron Paul has always kept a tight budget and he commonly returns unused portion of office budget to the US Treasury. He has a long record of showing respect to our money.
“Lowers the corporate tax rate to 15%, making America competitive in the global market. Allows American companies to repatriate capital without additional taxation, spurring trillions in new investment. Extends all Bush tax cuts. Abolishes the Death Tax. Ends taxes on personal savings, allowing families to build a nest egg.”
Unlike the other candidates, Ron Paul understands how the economy works. He is regarded as a champion of Austrian economics and is noted as an economic historian. Most American’s don’t understand the power of taxation; the cascading effect that occurs on our industry and workforce. Let’s look at how Ron Paul’s lower corporate tax, for example, would create jobs.
By allowing American companies to repatriate capital without being taxed in multiplicity, it would encourage trillions of dollars in new investments. When we, as businesses or individuals, keep our tax dollars it results in spending and investing. Spending leads higher production demands, while investing leads to efficiency and lower consumer prices, lower consumer prices leads to more consumer spending. This spending spurs intense demand on both finished and raw materials, ultimately demand for workers explodes. This one element would create hundreds of thousands of jobs, Ron Paul knows that.
Once America is on its feet, Ron Paul, as stated time and time again, would move to abolish the federal income tax.
“Repeals ObamaCare, Dodd-Frank, and Sarbanes-Oxley. Mandates REINS-style requirements for thorough congressional review and authorization before implementing any new regulations issued by bureaucrats. President Paul will also cancel all onerous regulations previously issued by Executive Order.”
Anyone who owns a business or knows someone who owns a business understands that our regulatory system is not only burdensome but is a primary cause of unemployment. Ron Paul isn’t for getting rid of important regulations, however, too many arbitrary regulations leads to job loss. We need to set the stage for prosperity, if it’s easier in America for a small business to succeed, than America goes back to work. Furthermore, deregulation coupled with Ron Paul’s lowered corporate tax will invite production back into America.
“Conducts a full audit of the Federal Reserve and implements competing currency legislation to strengthen the dollar and stabilize inflation.”
In 1971, at the behest of then Federal Reserve Chairman Arthur Burns, we departed from the gold standard and invited elasticity to our monetary policy. This gave the Fed ultimate control through inflation and the abuse of this power by Alan Greenspan is specifically what led us to our current crisis. What’s worse is the $16 trillion dollars that was secretly given to large banks, some foreign, was just put on the back of the taxpayer. The fact that more politicians aren’t calling for a full audit should be a red flag to where their loyalties lay, the people deserve to know where their money has gone. I recently wrote an expose on Herman Cain’s involvement with the Federal Reserve and why it should concern us all, for those unfamiliar with the Herman Cain or the Fed I urge you to read it.
Ron Paul, I am confident, will get the Federal Reserve under control and get us back on a gold standard. He will also set the stage for competing currencies, this will end the possibility of future abuses to our business cycle and we will enjoy a prosperity that the people have never known.
“Dr. Paul is the only candidate with a plan to cut spending and truly balance the budget. This is the only plan that will deliver what America needs in these difficult times: Major regulatory relief, large spending cuts, sound monetary policy, and a balanced budget.”
We should all take into consideration that Ron Paul bested 99.9% of the economic thinkers by accurately predicting our current economic crisis years before it happened. Ron Paul’s plan is economically sound and will lead us to a near future of prosperity along with safeguards to stop future crisis. Ron Paul is not alone in his synopsis and proposed treatment; many other noted economists have shown strong support of these ideas for decades.
Those of you who can’t bring yourselves to terms with a certain portion of the plan keep in mind; Ron Paul offers a 3 year recovery while the inadequacy of plans presented by other candidates would almost certainly guarantee at least 10 years more of recession along with a high probability of re-occurrence.