Category Archives: Spending

There Is Nothing Left to Cut

Posted on May 8, 2012 | Comments Off on There Is Nothing Left to Cut

There are currently four living ex-presidents. All of them are wealthy. According to Politico, all of them are also accepting taxpayer largesse:

George W. Bush may have raked in $15 million from speeches alone in 2010, but he still expensed $1.3 million to taxpayers, including $80,000 in phone bills, ABC News’s Jonathan Karl reported in “Spinners and Winners.”And Bill Clinton also made it big on the speech circuit — bringing in $10 million — and billed more than $1 million in expenses to taxpayers. Jimmy Carter, meanwhile, received over half a million in expenses, including $15,000 for postage, and taxpayers also paid $830,000 for George H.W. Bush.

Entitlement reform is what it will ultimately take to balance the books, and should be one of Congress’ highest priorities. But wasteful spending such as George W. Bush’s phone bill should be reined in, too. Fortunately, a bill from Rep. Jason Chaffetz would end taxpayer giveaways to ex-presidents with incomes over $400,000 per year.

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Posted in Political Animals, Spending

Funding Government by the Minute

Posted on March 31, 2012 | Comments Off on Funding Government by the Minute

Antony Davies has a creative way to explain the deficit in a new Learn Liberty video. Last year, the government took in $2.2 trillion. It spent about $3.8 trillion, or $434 million per hour. At that rate, $2.2 trillion is enough to fund the government from January to the end of July.

Abolishing NASA, the entire U.S. military, all federal funding for police and fire protection, courts, prisons, education, transportation, shuttering Congress and the White House, and a whole lot more besides only gets us to December 16.

In other words, if the only remaining federal spending was on Social Security, Medicare, Medicaid, and debt interest, we still wouldn’t have a balanced budget.

The lesson is that the government should stop making promises that the laws of mathematics won’t allow it to keep.

Click here if the embedded video doesn’t work.

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Posted in Economics, Spending

Free-Market Fundamentalism

Posted on December 8, 2011 | Comments Off on Free-Market Fundamentalism

This letter of mine in response to Andy Stern’s recent op-ed ran in today’s Wall Street Journal:

If America is indeed a free-market fundamentalist nation, it sure has a funny way of showing it. Federal, state and local governments combine to spend roughly 40% of GDP, and that doesn’t count the cost of compliance with federal regulations.

In his eagerness to attack free markets, Mr. Stern has confused the mixed economy’s crony capitalism with the real thing.

Ryan Young
Competitive Enterprise Institute
Washington

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Posted in Correspondence, Economics, regulation, Spending

Missing the Bigger Story

Posted on December 2, 2011 | Comments Off on Missing the Bigger Story

Here’s a letter I recently sent to the Washington Post:

Editor, Washington Post:

Anita Kumar’s November 29 Virginia Politics blog post “McDonnell recommends eliminating agencies, boards, commissions” incompletely details Virginia Gov. Bob McDonnell’s “ongoing effort to reshape and shrink state government.” By deregulating three professions, eliminating two state agencies, and merging 19 others, $2 million could be trimmed from the commonwealth’s budget if the legislature approves the proposal.

She does not mention that Virginia’s budget is set to increase by $1.1 billion in 2012. This new spending outweighs the proposed cuts by a factor of 550. Gov. McDonnell may be modestly reshaping government, but he certainly isn’t shrinking it.

Ryan Young, Washington
The writer is a fellow at the Competitive Enterprise Institute.

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Posted in Correspondence, Economics, Spending

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Let Me Be Clear

Posted on November 29, 2011 | Comments Off on Let Me Be Clear

Here’s a letter I sent to Politico:

Editor, Politico:

Jonathan Allen’s November 28 article, “Mandatory budget cuts after supercommittee failure will trigger pain for some,” is misleading. A cut is when spending goes down. Federal spending will go up every year for at least the next ten years, even with the supercommittee’s failure to reach a bipartisan agreement.

According to the Congressional Budget Office, defense spending is projected to increase by 18 percent between 2013 and 2021. Discretionary spending is set to increase by 12 percent over the same period. These increases are lower than previous projections. But they are still increases. And an increase is not a cut. Not even in Washington.

Ryan Young

See also the chart below that the Mercatus Center’s Veronique De Rugy put together using CBO data. I can’t put it more plainly: there are no supercommittee-related budget cuts. Stop saying that there are.

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Posted in Correspondence, Economics, Spending

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For the Children

Posted on October 25, 2011 | 1 comment

The people of Illinois don’t expect their government to be corrupt; they insist on it. That’s why nary an eyebrow was raised when it recently came out that two lobbyists for the Illinois Federation of Teachers were able to qualify for generous teachers’ pensions by working as substitute teachers for one day.

One man could receive up to $3.8 million if he lives to age 84. This is in addition to the 401(k) the union gives him as an employee. The Chicago Tribune reports:

Preckwinkle’s one day of subbing qualified him to become a participant in the state teachers pension fund, allowing him to pick up 16 years of previous union work and nearly five more years since he joined. He’s 59, and at age 60 he’ll be eligible for a state pension based on the four-highest consecutive years of his last 10 years of work.

His paycheck fluctuates as a union lobbyist, but pension records show his earnings in the last school year were at least $245,000. Based on his salary history so far, he could earn a pension of about $108,000 a year, more than double what the average teacher receives.

Nationwide spending on K-12 education is around $13,000 per child per year. Not all of that spending is actually for the children, contrary to popular rhetoric. Fortunately, it appears only two people took advantage of this scheme. But the real kicker is that one of the two actually helped write the legislation that made it possible.

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Posted in education, Political Animals, Public Choice, Spending

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There Is Nothing Left to Cut

Posted on October 13, 2011 | Comments Off on There Is Nothing Left to Cut

Headline: “Town Spends $1,000 on Rubber Chickens”

And that’s not all:

[Cicero, Illinois] Town President Larry Dominick’s administration has also spent nearly $600,000 on promotional items, including mouse pads and ice cream scoops, from You & Me.

Hanania said he expects proceeds from the Houby Day festival to pay the bill for the chickens.

“It is what it is. We’re not hiding it. We’re trying to be aboveboard,” he said.

His transparency is laudable. But he forgets about opportunity costs. Rubber chickens aren’t exactly revenue magnets. They are unlikely to add more than their cost to Cicero, Illinois’s town coffers. Meanwhile, those thousand dollars could have been put to some better use — schools, police or fire protection, fixing potholes, you name it. Surely those things are more desirable than 250 rubber chickens.

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Posted in Economics, Spending

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DC’s Capital Bikeshare Program

Posted on September 27, 2011 | 7 comments

If you walk around DC, you’ll see bright red bike racks here and there, along with matching bicycles. They were installed about a year ago, and anyone can use them. It’s the city’s way of encouraging people to use bicycles instead of cars.

It hasn’t worked as planned. According to my colleague Marc Scribner, before the Bikeshare program, about 1.6 percent of person-trips in the city were on bikes. Now it’s 1.9 percent.

That 0.3 percent gain comes at a steep price:

The Capital Bikeshare bikes cost around $1,000 a piece and have a life cycle of six years. Annual operating costs are somewhere closer to $2,000 per bike. In the past two years, I have spent approximately $500 on my personal bike that I commute to work on daily — $250 a year. Capital Bikeshare’s costs given the benefits are simply absurd.

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Posted in Economics, Spending

CEI Podcast for September 15, 2011: Solyndra

Posted on September 15, 2011 | Comments Off on CEI Podcast for September 15, 2011: Solyndra

 

Have a listen here.

Myron Ebell, Director of CEI’s Center for Energy and Environment, takes a look at the brewing Solyndra scandal. Solyndra is a company that makes solar panels and recently declared bankruptcy. In 2009, the federal government gave Solyndra a $535 million loan even though its own analysts predicted the company would go bankrupt in 2011. The company’s cozy relationship with political figures, including a major political donor with an investment stake, make the loan — and its low interest rate — look rather suspicious.

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Posted in CEI Podcast, Spending, Stimulus, The New Religion

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New Math: Lobbying Edition

Posted on September 13, 2011 | Comments Off on New Math: Lobbying Edition

State and local governments across the country are looking for fat to trim from their budgets. One place many are considering cutting is lobbying the federal government. That particular expense has gone up sharply over the last decade:

The trend is clear: Spending on federal lobbying by municipalities and other nonfederal governments soared from $37.2 million in 1999 to $93.3 million in 2009, according to data compiled by the Center for Responsive Politics. But that figure dipped slightly in 2010, and this year, it’s seems it will barely crack the $80 million mark.

One lobbying firm that gets a lot of its business from state and local governments would like to get that spending back up. That’s why it is running an ad claiming that “Lobbying is no 4-letter word.”

Correct. “Lobbying” is an 8-letter word.

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Posted in Economics, Public Choice, Spending