{"id":4599,"date":"2023-08-07T10:14:52","date_gmt":"2023-08-07T15:14:52","guid":{"rendered":"https:\/\/binkley2024.com\/?p=4599"},"modified":"2023-08-07T11:46:44","modified_gmt":"2023-08-07T16:46:44","slug":"7-year-economic-rescue-plan","status":"publish","type":"post","link":"https:\/\/binkley2024.com\/7-year-economic-rescue-plan\/","title":{"rendered":"7-Year Economic RESCUE Plan"},"content":{"rendered":"
The recent downgrade of the U.S. government by Fitch Ratings is a wake-up call that our current runaway spending and broken budget process cannot continue.\u00a0 Our fiscal system is headed toward a crisis; we need a President who has the courage to set a new path.\u00a0\u00a0<\/span><\/p>\n I\u2019ve put together a plan to <\/span>attack the deficit and bring the budget back into balance in 7 years. <\/i><\/b>Moreover,\u00a0 <\/span>transparency and accountability must be restored<\/i><\/b> to the way that Washington spends taxpayers\u2019 money.\u00a0\u00a0<\/span><\/p>\n First, I\u2019ll warn you right now, many critics \u2013 including many Republicans and likely some of my opponents in this primary \u2013 are going to say that trying to balance the federal budget in 7 years is, \u201ctoo much, too fast.\u201d<\/span><\/p>\n Let me remind you that those are the same people who watched the deficit more than double over the past 7 years<\/span> from $620 billion to $1.375 trillion.\u00a0<\/span><\/p>\n According to the U.S. Treasury, spending in FY 2023, through June, was 10 percent higher than in 2022.\u00a0 That\u2019s another $455<\/span> billion, and the fiscal year isn\u2019t over yet.\u00a0\u00a0<\/span><\/p>\n When is Washington\u2019s out of control spending going to stop?\u00a0 When will our federal government\u2019s excessive borrowing get under control?<\/span><\/p>\n The Nobel Prize winning economist Milton Friedman wrote a book almost 40 years ago entitled <\/span>Tyranny of the Status Quo<\/span><\/i>.\u00a0 Indeed, keeping Washington\u2019s fiscal status quo in place has already saddled us with mountains of debt and mortgaged our children\u2019s and grandchildren\u2019s future.\u00a0 <\/span>It is time to look at what we\u2019re doing to the next generation.\u00a0\u00a0<\/i><\/b><\/p>\n Consider our country\u2019s debt.\u00a0 The best way to look at federal debt and how Washington is living beyond its means \u2013 or <\/span>our<\/span><\/i> means as taxpayers \u2013 is to consider debt as a percent of the nation\u2019s GDP.\u00a0 The federal debt-to-GDP was 118 percent at the end of Q1 2023<\/span>\u00a0<\/span><\/p>\n In simpler terms, the federal government owes more than the U.S. economy is worth!\u00a0\u00a0<\/span><\/p>\n Back when Dr. Friedman wrote his book, the debt was 4.7 percent of GDP.\u00a0 Moreover, America sacrificed and acted to save the world during World War II, yet the federal debt at its high point in 1943 was 29.6 percent of GDP \u2013 less than one-third of what it is now<\/span>.\u00a0\u00a0<\/span><\/p>\n That\u2019s a sobering thought given the state of the world today.<\/span><\/p>\n Reigning in spending and putting an end to our government\u2019s excessive borrowing is fundamental to grow the U.S. economy, shore up our regional banks, and save the U.S. dollar\u2019s role as the world’s reserve currency.<\/span><\/p>\n My 7-Year Economic RESCUE Plan is <\/span>based on four pillars of action<\/i><\/b> that I will take as President. It won\u2019t be easy, but it has to be done.<\/span><\/p>\n First, we need to change the way the federal budget is written.\u00a0 Unlike household or small businesses, the federal budget is structured to automatically increase every year.\u00a0 The accounting system the government uses is called \u201cbaseline budgeting.\u201d\u00a0 Under that system, the previous year\u2019s level of federal spending is adjusted for inflation and the population growth rate each year.<\/span><\/p>\n According to the latest projection by the Congressional Budget Office (CBO) that baseline budgeting will add about $2.48 trillion in spending from FY2024 to FY2031<\/span> \u2013 that increase is already cooked into the books even if Congress never approves another penny increases for any federal program.\u00a0\u00a0\u00a0<\/span><\/p>\n Obviously, it goes without saying, two things that would help slow this unchecked growth:\u00a0<\/span><\/p>\n Under the Biden Administration, inflation has skyrocketed. In 2022 inflation hit its highest level since March 1980.<\/span>\u00a0 Moreover, according to the Federation for American Immigration Reform (FAIR), illegal immigration is adding about $150.6 billion in federal spending per year as of 2023<\/span> \u2013 and has added burdensome costs to border states, like my home state of Texas.<\/span><\/p>\n It\u2019s time to make Washington operate under the same rules as every household and every small business in America when it comes to making an annual budget<\/i><\/b>, and that is by starting with the resources that are at hand.\u00a0 Only in Washington is spending the same amount next year referred to as a \u201ccut.\u201d\u00a0\u00a0<\/span><\/p>\n We need truth in budgeting<\/i><\/b>. Because right now by assuming there is an endless supply of money available through taxes and borrowing, we\u2019re only fooling ourselves.\u00a0<\/span><\/p>\n My first budget submission as President will start with reconciling government spending decisions with the resources we have, not by some automatically inflated baseline.\u00a0<\/span><\/p>\n That\u2019s a constructive place to start.\u00a0 Looking at the latest CBO baseline projections, freezing spending in 2024 actual levels would put the federal budget in balance by 2031 \u2013 <\/span>that\u2019s 7 years<\/i><\/b>.\u00a0\u00a0<\/span><\/p>\n <\/p>\n Further, the cumulative savings from a spending freeze would reduce the <\/span>interest paid on the debt which is now the fastest growing category of federal spending<\/i><\/b>.\u00a0 According to CBO<\/span>, net interest payments on federal debt will more than double between 2022 and 2032.\u00a0\u00a0<\/span><\/p>\n As interest payments grow, some other category of spending has to be cut, eventually. Anyone who has managed a household budget already knows that.\u00a0 We can\u2019t borrow our way into solvency.<\/span><\/p>\n I\u2019ll be the first to admit that writing a budget starting from a spending freeze baseline will require some tough choices, but <\/span>making tough choices is what taxpayers expect of their elected officials<\/i><\/b>.\u00a0 And they obviously have been let down.\u00a0 If Congress was a football team, it would be a roster made up of 535 punters!<\/span><\/p>\n That is why I am running for President \u2013 to provide leadership to solve one of the most pressing issues facing our country and its future<\/i><\/b>.\u00a0 Our fiscal system in headed toward a crisis; we need a President who has the courage to set a new path.\u00a0 As a businessman I know we don\u2019t need to cut everything, nor should we.\u00a0 What we need to do is to cut the things to don\u2019t work and invest in the things that do work.<\/span><\/p>\n We need to be honest about the tough choices which need to be made, however.\u00a0 Yes, that means reducing discretionary spending, but it also means entitlement reform.<\/span><\/p>\n First, starting with nondefense discretionary spending, we need a two percent cut across the board.\u00a0 Our fiscal house is in disarray.\u00a0 We are not in a position to be paying for everything we want, instead we must focus on what we need.\u00a0<\/span><\/p>\n Second, we must save Social Security.\u00a0 <\/span>Social Security is projected to be insolvent by 2033<\/i><\/b>.\u00a0 <\/span>Social Security, technically, has two trust funds: the Old Age and Survivors Insurance (OASI) trust fund for retirees and survivors, and the Social Security Disability Insurance (SSDI) trust fund for disabled workers. Those trust funds on a combined basis will be exhausted in 10 years.\u00a0 If that happens, full benefits cannot be paid when they are due \u2013 it is estimated that will be a 20 percent cut.\u00a0 Politicians have been irresponsibly ignoring this issue for decades, but it can be ignored no longer. I won\u2019t ignore it.<\/span><\/p>\n I will peg Social Security to the growth in GDP over the next seven years; growth will be capped at two percent and in no instance will spending drop below zero.<\/span><\/p>\n A new plan for legal immigration, adding more legally employed, and needed, taxpayers to pay into Social Security will also help shore up the system and the economy.\u00a0\u00a0\u00a0<\/span><\/p>\n Third, we must enact comprehensive health care reform; we can\u2019t balance the budget without getting health care costs under control.\u00a0 To begin, I will freeze Medicare and Medicaid spending, and then <\/span>end the monopolies on insurance exchanges, health care providers, and Big Pharma. That will cut costs across the board and go a long way to bringing our entitlement spending under control.<\/span><\/p>\n As I said, <\/span>we need to cut the things that don\u2019t work.\u00a0 One example is <\/i><\/b>Obamacare<\/i><\/b>. That program, through its regulations and subsidies, has ballooned Medicaid costs and provided benefits to people that Medicaid was never intended to cover. For all the billions spent, coverage is now more expensive, and health care choices have decreased. We can\u2019t allow this to continue.<\/span><\/p>\n While there are indeed tough budgetary choices to be made, by the same token, there are some easy decisions too.\u00a0 Take <\/span>President Biden\u2019s absurdly named $739 billion Inflation Reduction Act<\/i><\/b>.\u00a0\u00a0<\/span><\/p>\n There is so much more unnecessary spending to look at \u2013 <\/span>if our elected leaders would just take the initiative to do so.\u00a0 I will.\u00a0\u00a0<\/i><\/b><\/p>\n For example, programs that are <\/span>best handled by the States<\/i><\/b>; we don\u2019t need to federalize everything. That\u2019s not what our founders intended.<\/span><\/p>\n Programs that <\/span>no longer serve their purpose<\/i><\/b>;<\/b> again, it was Milton Friedman in his book who coined the phrase, \u201c<\/span>Nothing is so permanent as a temporary government program.\u201d<\/span><\/i> \u00a0<\/span><\/p>\n Finally, I\u2019ll cut \u2013 and most importantly prevent \u2013 <\/span>waste, fraud, and abuse<\/i><\/b>.\u00a0 Of course, the more the government spends, the more waste, fraud, and abuse there is.\u00a0\u00a0<\/span><\/p>\n The more than $5 trillion in COVID era programs provide an object lesson in that. Michael Horowitz, Inspector General of the U.S. Department of Justice told Congress that <\/span>fraud from COVID programs is <\/i><\/b>\u201cclearly in the tens of billions of dollars.\u201d<\/i><\/b>\u00a0 We cannot let that happen again.\u00a0<\/span><\/p>\n A key pillar to getting our nation\u2019s fiscal house in order is a <\/span>pro-growth tax code<\/i><\/b>.\u00a0<\/span><\/p>\n Washington tries to micro-manage the economy with an economically lethal cocktail of high marginal tax rates, with tax credits, loopholes, and misguided incentives stirred in; that doesn\u2019t work.\u00a0<\/span><\/p>\n Too often these breaks are about crony capitalism, benefitting certain politically favored industries.\u00a0 Again, consider the Inflation Reduction Act.\u00a0 Goldman Sachs analyzed the tax credits for electric cars, hydrogen, green manufacturing and more, and concluded that the $391 billion in the IRA over the next 10 years for these provisions would actually cost $1.2 trillion. That\u2019s because those tax credits are not capped.<\/span><\/p>\n The Inflation Reduction Act adds <\/span>43 new tax credits and deductions<\/i><\/b> to a tax code that is already riddled with too many tax breaks.\u00a0\u00a0<\/span><\/p>\n The next President will see the <\/span>2017 Tax Cuts and Jobs Act<\/i><\/b> – passed under a Republican President, Republican House, and Republican Senate \u2013 expire in 2025.\u00a0 <\/span>At a minimum, those tax reforms must be extended.<\/i><\/b><\/p>\n But I won\u2019t stop there.\u00a0 <\/span>We need a flatter, fairer tax system to foster growth<\/i><\/b> in the economy and allow taxpayers the opportunity to save and invest for the future.\u00a0 I will reform the tax code like Ronald Reagan did.\u00a0<\/span><\/p>\n Be assured that a lack of revenue for the federal government is not the problem; too much spending is. Tax revenue to the federal government is more than 18 percent of the GDP; the problem lies in the fact that federal spending is more than 24 percent of the GDP.<\/span><\/p>\n The final pillar to balance the budget in 7 years is the badly needed reform of our federal budget law, the 1974 Congressional Budget and Impoundment Control Act.\u00a0 Budget process reform is not the most exciting issue \u2013 which is why you don\u2019t hear other candidates talk much about it \u2013 especially those who have been in Washington for years and done nothing to fix this broken system.\u00a0<\/span><\/p>\n There is nothing more fundamental under Congress\u2019 Constitutional \u201cpower of the purse.\u201d\u00a0\u00a0\u00a0\u00a0<\/i><\/b><\/p>\n The 1974 Act created the House and Senate Budget Committees, established a process, and set a timeline for Congress to consider and produce a budget resolution and annual appropriations.\u00a0 Congress has virtually abandoned the process; no wonder the federal budget has grown out of control. Congress\u2019 discarding the budget process is like throwing away your road map before going on a trip.<\/span><\/p>\n Consider, Congress is supposed to\u00a0complete a budget resolution laying out the fiscal guidelines and setting appropriations levels by April 15.\u00a0 The last budget resolution that Congress even bothered to pass, for fiscal year <\/span>2022, was in August \u2013 four months later.\u00a0\u00a0<\/span><\/p>\n The federal government doesn\u2019t let tax payers miss their April 15 deadline.\u00a0 In fact, the Inflation Reduction Act added $80 billion to hire new IRS agents to make sure they can\u2019t.\u00a0 That\u2019s another place to cut spending.\u00a0 The House Republicans trimmed around the edges with the Limit, Save Grow Act \u2013 but didn\u2019t cut nearly deep enough.<\/span><\/p>\n For Congress, missing budget deadlines, or worse, ignoring the responsibility to pass a budget at all is the norm.\u00a0<\/span><\/p>\n As the Committee for a Responsible Budget notes, \u201c<\/span>Given our terrible fiscal situation, with near-record deficits and debt, this is a tremendous abdication of responsibility<\/span><\/i>.\u201d\u00a0 To that I say, amen.\u00a0<\/span><\/p>\n But it gets worse, \u2026<\/span><\/p>\n Congress is to complete 12 separate appropriations bills in June before the beginning of the next fiscal year on October 1. However, the last time Congress passed all its appropriations before the fiscal year actually began was in 1997, \u2026 26 years ago.\u00a0 They will miss the deadline this year as well.<\/span><\/p>\n In fact, since 1974, <\/span>Congress has only completed its appropriations process before the new fiscal year a total of four times<\/i><\/b>: 1977, 1989, 1995, and 1997.<\/span><\/p>\n When Congress misses the deadlines of a new fiscal year, it passes a \u201ccontinuing resolution\u201d \u2013 which just keeps federal spending at its current level until the government finally gets around to making budget decisions it should have already. And then adds more spending.\u00a0\u00a0<\/span><\/p>\n Again, over the past 47 years Congress has passed continuing resolutions in all but 3 years.\u00a0 These continuing resolutions can last a day or an entire year.\u00a0 That\u2019s why there have been 192 of them since 1974; there were 21 continuing resolutions in 2001 alone.<\/span><\/p>\n Imagine an American family telling their bank or their creditors they were just going extend their current spending and worry about adjusting their budget later.\u00a0\u00a0<\/span><\/p>\n In short, Congress won\u2019t follow the law when it comes to budgeting.\u00a0 As President I will have a package of<\/span> budget process reforms to bring accountability \u2013 and fiscal responsibility \u2013 <\/i><\/b>back to the federal budget process.<\/span><\/p>\n On day one, I will issue an Executive Order <\/span>directing the Office of Management and Budget to publicly call out every missed deadline on the part of Congress<\/i><\/b> so American taxpayers know when Congress is not meeting its responsibilities. Sunshine is the best disinfectant for this unseemly business as usual.\u00a0\u00a0<\/span><\/p>\n My Administration will review every dollar of Congressional spending bills and <\/span>will submit a list of unnecessary spending items for Congress to vote on again<\/i><\/b>.\u00a0 This is known as \u201crescission authority\u201d granted the President under the Budget Act.<\/span><\/p>\n Under the current process, however, Congress simply can ignore the President\u2019s rescission requests for 45 days and then the money must be spent.\u00a0 My reform plan will <\/span>require<\/span> a Congressional vote on these rescission requests.\u00a0 Note the House of Representatives, under a Republican majority, passed a measure like this in 2012; it died in the Democrat controlled Senate.\u00a0\u00a0<\/span><\/p>\n I like to call this the <\/span>Earmark Line Item Veto.\u00a0<\/i><\/b><\/p>\n Congress has a practice of political log-rolling and vote trading by putting wasteful \u201cear marks\u201d in spending bills that direct federal spending toward Members\u2019 parochial pet projects and political cronies.\u00a0 Sunshine is the best disinfectant to clean up this unseemly business as usual.\u00a0\u00a0<\/span><\/p>\n Further, right now, the annual federal budget is considered a \u201cconcurrent\u201d resolution \u2013 a Congressional document between the House and Senate.\u00a0 It never makes its way to the President\u2019s desk.\u00a0 I\u2019ll propose to change that to a \u201cjoint\u201d resolution, which would <\/span>make the budget an act of Congress that the President signs \u2013 or vetoes<\/i><\/b>.\u00a0<\/span><\/p>\n All too often in recent years, the budget situation has to come to a crisis point, such as a government shut down or threat of a debt limit default before Congress, who spends the money, and the Administration, who administers that spending, work together on a long term plan.\u00a0 By making the budget a joint resolution that the President signs, we don\u2019t have to wait for a crisis.\u00a0\u00a0\u00a0<\/span><\/p>\nTruth in Budgeting<\/span><\/h3>\n
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Fiscal Leadership to Make Tough Choices<\/span><\/h3>\n
Pro-Growth Tax Policy<\/span><\/h3>\n
Budget Process Reform<\/span><\/h3>\n
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