A Positive Step but Miles to go Before we Sleep

Most Americans, Democrat, Republican or unaffiliated, liberal, moderate, or conservative, wealthy, middle class, or under class, were as pleased as punch to learn of the compromised federal budget, passing through both aisles of the House of Representatives floor, passed with 300 out of 435 votes and is on its way to the Senate. If it passes the high house as well, there is no reason not to believe President Obama will put his John Hancock on it and we are spared both sequestration and government shutdowns for the next two years. I am no exception. I’m sure if I sat down with some friends both liberals and conservatives and held a coffee table moratorium, we could find the faults and exploit them. But let’s not forget that there is nothing perfect on planet Earth and not only is the aforementioned budget better than noting, it is overall a high-rated piece of legislation.

One thing we must not forget that I have communicated in several previous postings is that it is perfunctory politics, not partisan politics that is harming this great nation. Just because something is passed in a bipartisan fashion (versus one party outnumbering the other), doesn’t mean it’s going to work. If compromising and reaching across the aisle is going to be a new trend in Washington, be happy about it, but at the same time, be vigilant for something that just won’t work.

There is are two quirks in this budget the American people need to understand. First of all, they did not incorporate the proposed Farm Subsidies bill still in front of Congress; they could have killed two birds with one stone. If a farm subsidies bill is not passed by 01-01-2014, a gallon of milk will cost $7, no matter what outlet you purchase. Due to shortages and the inability for dairy farmers to remain solvent, a 1948 law would kick in requiring the Federal Government to buy all of the milk, cheese, and butter from these failing farmers and sell it to the general public at twice what they paid. If the price is not bad enough, there will be a lot fewer dairy farmers dotting the landscape of America’s heartland and we will end up importing a lot more food products; from countries that do not have the same cleanliness standards, resulting in more outbreaks of salmonella and other food-related illnesses.

The other thing, the obvious, this new budget does not cure America’s debt. We will still be in the decatrillions and spending is still on the increase; only the rate of growth decreased. What I mean by that is let’s say you need a new car and your finances allow you to tolerate maximum car payments of $500 a month. You shop around and decide to buy a car with payments of $300 a month. You claim you saved $200 a month. In reality, your monthly expenses are now $300 higher but the rate of growth of your monthly expenses is lower than it could have been. I don’t think that is good enough if we are ever going to achieve a balanced budget. Rate of growth may have been a viable parameter to work with 35 years ago, in the Reagan years when the T word (trillion) was still able to give way to the B word (billion). According to the Schoenhaus Theorem and corresponding Calculating Lemma, where a prototype is creating setting America in the present into a 1789 form of government and then determining what can be added still keeping the ink black, I see it as too late for even zero rate of growth. Negative rate of growth or positive rate of decay is now required to hone in on a balanced budget.


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