Government Spending & Budget As many Federal departments and agencies lurch into an era of running without funds, the leaders of both parties of Congress are spending less and less time searching for a compromise to balance the budget, and more and more time deciding how to use it to their advantage on the campaign trail. Meanwhile money is easily borrowed to pay for government overhead. In an attempt to change this, on June 29, Congress voted in favor of HConRes67 that called for a 7 year plan to balance the Federal Budget by the year 2002 (Hager 1899). This would be done by incorporating $894 billion in spending cuts by 2002, with a projected 7 year tax cut of $245 billion. If this plan were implemented, in the year 2002, the U.S. Government would have the first balanced budget since 1969. There is doubt by citizens that a balanced budget will become reality. A recent Gallop Poll from January, 1996 showed the budget as the #1 concern among taxpayers, but 4/5 of those interviewed said they doubt the GOP will do the job (Holding 14). Meanwhile, an ABC poll from November reported that over 70% of those polled disapprove of the current performance by Congress, and most blamed politicians for failure to take action (Cloud 3709). These accusations of failure to follow through come with historical proof that Congress and Clinton have failed to compromise and resolve the issue. After all, current budget plans are dependent on somewhat unrealistic predictions of avoiding such catastrophes as recession, national disasters, etc., and include minor loopholes. History has shown that every budget agreement that has failed was too lax. One might remember the Gramm-Rudman-Hollings bill that attempted to balance the budget, but left too many exemptions, and was finally abandoned in 1990 (Weinberger 33). So after a pain-staking trial for GOP Republicans to create, promote, and pass their budget, as promised on campaign trail 94, Clinton rejected the very bill he demanded. This essentially brought the federal budget back to square one. Clinton thought such a demand on Republicans to produce a budget would produce inner-party quarrels and cause the GOP to implode. Instead, they produced a fiscal budget that passed both houses of Congress, only to be stalemated by a stubborn Democratic President Clinton. Meanwhile, Clinton bounced back with a CBO scored plan with lighter, less risky cuts to politically sensitive areas like entitlements. Clinton's plan also saved dollars for education and did not include a tax increase, but most cuts would not take effect until he is out of office, in the year 2001. Although Clinton is sometimes criticized for producing a stalemate in budget talks, the White House points out that the debt has gone down since Clinton took office, with unemployment also falling. Republicans are quick to state that Clinton originally increased taxes in 1993 and cut defense programs, but his overall plan was for an increasing budget without deficit reduction. Startling Facts about the budget: As of 1996, the national debt was at an all time high of $5 trillion dollars, with interest running at a whopping $250 billion per year (Rau M-1). This equals out to an individual responsibility of more than $50,000 per taxpayer. Nearly 90% of that debt has accumulated since 1970, and between 1980 and 1995, the debt grew by 500%. Currently, the debt grows by more than $10,000 per second (Rau M-l), and at current rates, a baby born in 1992 will pay 71% of his or her income in net taxes. At current rates, our government is about to reach its breaking point. If that's not enough to scare a taxpayer, by 2002, 60% of government spending will be for entitlements, and by 2012, these programs are projected to take up all government revenue (Dentzer 32). Not only economic development, but also family income is hurt by debt. With the cost of living going up, it becomes harder to find a job. According to the Concord Coalition, real wages peaked in 1973 and have gone down ever since. If the economy grew as fast as it did in 1950, without a debt, the median family income would be $50,000, compared to the present median of $35,000 (Rau M-1). As of current fiscal year's budget, the United States government spends $1.64 trillion yearly. $500 billion of that, or 1/3 of the total, is for discretionary spending (Rau M- 1). This discretionary spending is the target for most cuts, and seems to be the easiest to make cuts in. Overall, the difference between the two parties budget plans is only $400 billion. This could easily be trimmed by eliminating tax cuts and adjusting the consumer price index to reality. Democrats say the GOP plan is too lopsided, and Republicans criticize the Democrat plan for being unrealistic. A study by the Urban Institute shows GOP cuts will be felt mainly by the bottom 1/5 of U.S. population. This should be more equally spread out across income brackets (Hosansky 1449). The GOP plan: By fulfilling campaign promises ma
Quotes talked about in this paper
- "The President is sitting on his hands while the federal debt keeps going up and up and up into the stratosphere," said Congressman Jesse Helms, ...
- "Both parties want the issue," instead of an agreement, said Representative Bill Orton.
- "interest rates come down, the economy picks up - we will rebound," says Representative James Greenwood ...
- themselves the "Blue Dog's"
- "There is little or no change at all in this budget," said Pete Domenici ...
Terminology talked about in this report
Social Security, GDP,
Names talked about in this report
Clinton, Senate Budget Committee Chairman, Rau, Rubin, Henderson, Hager, Hosansky, Weinberger, President Truman, Representative Bill Orton, Congressman Jesse Helms, Representative James Greenwood, Neil Howe,
Organizations mentioned in this research paper
Republicans, Congress, Federal Government, Office of Management and Budget, Concord Coalition, U.S. Government, Medicare, Sweden's government, Clinton Administration, BA, Urban Institute, Treasury Department, EITC, National Service,
Locations talked about in this report
U.S., Washington, Wyoming, Sweden, America,
Holiday included in this term paper
New Years Day,
Facility mentioned in this research paper
Companies referenced in this paper
Keywords included in this paper
the budget, the gop, entitlement, balanced budget, government spending, discretionary spending, budget resolution, deficit, Social Security, Senate Budget Committee, tax cut, debt, Budget deficits, President Clinton, Concord Coalition, fiscal year, United States, Federal Government, family income, cutting, national debt, median family income, United States government, taxes, student loans, early retirement, White House, means testing, Income Tax, income taxes, 7 years, United States Treasury Department, entitlement programs, all time high, loopholes, federal debt, consumer price index, Medical Savings Accounts, yearly, taxpayer, conservative democrats, President Truman, Bill Orton, farm programs, Gallop Poll, Federal law, reductions, Bill Strauss, real wages, party line vote,
The Government Expenses. (1969, December 31). In DirectEssays.com. Retrieved 04:34, December 20, 2013, from http://www.directessays.com/viewpaper/46587.html