Friday, February 8, 2013

"Sequester away!"

On March 1st automatic spending cuts of $85 billion are set to go into effect, one half in defense cuts and one half across-the-board cuts affecting everything except Social Security, Medicaid and on-going wars. By law these cuts will continue, totaling $1.2 trillion over the next 10 years.

Democrats are screaming "the sky is falling" even though the "sequester" was the Obama administrations idea - they never thought it would happen. Democratic Congressmen have already started the classic liberal rhetoric, - "We will be taking food out of the mouths of children, etc, etc...."

I believe the sequester is a good start and much more needs to be done. To put things into perspective, this so-called "radical" cut in government spending is less that 10% of the projected deficit for the next fiscal year. The fiscal mismanagement of this government has been so incompetent that there is no solution to this problem without pain, so let's get started.

This week a friend of ours put the problem in perspective and her short, concise letter was printed in the Wall Street Journal. I quote:

"Working families are required to take a 2% reduction in take home pay this year.  It's only reasonable that every government department and agency (which working families pay for), should also be required to take a 2% reduction in their budgets"
 Leah Dukes
 Paso Robles, California

I agree completely.
During my career I managed three different companies, through good times and bad. During the bad times it was not unusual to assemble our department managers and tell them they had to cut their budget  5% or 10% - any way they wanted to do it, just do it. If a manager complained or said he couldn't do it, he was replaced.  For those that have had business dealing with the government I have a question - do you think government agencies could cut their budget 5%?  The Postal Service is a classic example - they want to stop Saturday delivery, saving $2 billion a year. That sounds impressive until you realize they lose $16 billion a year. Their wages and benefits consume 80% of their operating dollars compared to 32% for FedEx and 53% for unionized UPS. You can do the math.

Unfortunately government agencies cannot be required to cut expenses without Congressional approval and government employees cannot be fired for incompetence (Bengazi is a classic example). So we muddle along and wait for our incompetent politicians to get some guts and convince the electorate that short term financial pain now will result in a much brighter future for our children and grandchildren. Don't count on it.