The bipartisan compromise to cut spending in this year’s federal budget will keep our government running for the balance of fiscal year 2011. It avoids the shutdown of government services. Next year’s planned budget must be changed, reduced substantially, and agreed upon by both political parties. Right now, the outlook seems uncertain for adequate corrections to the long-term deficit reduction.
In order to put our fiscal house in order, we need to cut back on government spending. We need to solve the terrible deficit that could put our citizens and our country in hock for the future.
Before the mid-term elections, when the Democrats controlled both the House and the Senate, along with the presidency, they did not pass a budget for 2011. Budget plans were not prepared to meet the fiscal challenges facing our nation, either for this year or next year. Now, with a split Congress, with the House controlled by Republicans and the Senate with a bare Democratic majority, it is more difficult to gain agreement on how to fix our financial problems.
The huge deficit of $14.3 trillion coming up in mid-May was the result of excessive spending on social issues, domestic and military interventions. Both political parties in Washington should be embarrassed by the way the budget negotiations were handled.
The president, all of the members of the House of Representatives, and one-third of the senators, are up for re-election in 2012. All of these elected leaders are caught up in re-election concerns. They have to play to their constituencies, as well as do what they think is right. To a large extent, many are playing to the radical ends of their own parties.
Political decisions are being used by both parties to gain support from independents, businesses, unions, women, seniors, members of minority groups, and other potential voters they can identify, who are likely to be affected by future changes on Social Security, Medicare, Medicaid, health care and other issues. The administration is still pushing for tax increases on higher income citizens and corporations.
A serious budget crisis is brewing for 2012. The federal government’s budget must be trimmed. What will be acceptable on the 2012 budget will be difficult to determine in an election year. Both political parties must cooperate with each other to come to a mutual agreement that will benefit our country’s overall well being.
Right now, the big battle is over raising the debt ceiling, so that America can honor its financial obligations. But if the debt ceiling is raised, how will the huge deficit be reduced when even more debt is incurred?
We are facing a lot of inflationary pressures. Higher gas and oil prices, the turmoil of wars in the Mideast, and the aftermath of the earthquakes and tsunami in Japan will all lead to increased costs worldwide.
To prevent inflation, we must reform entitlements. Healthcare changes and costs must be reduced. Businesses on all levels need incentives of less regulations and lower taxes in order to grow the economy and build more jobs.
Fortunately, the administration is fighting to preserve education and research development. Probably social security changes will be grandfathered for people 50 years or older. Younger men and women under 50 years will be affected, but will have time to adapt to new requirements.
There will be a deadline to meet on the 2012 budget and it probably won’t be met on time. A sense of urgency by voters is now becoming real, since this year’s federal government 2011 budget went up to the wire before acceptance. The threat to close government agencies, furlough more than 100,000 government workers, close libraries, parks and government-supported facilities is hitting home. Even soldiers and their families’ paychecks, to cover mortgage payments and food, would not have been available.
While a shutdown did not occur, it was too close for comfort. Our elected officials need to work earlier and harder to agree on budgets, rather than taking our government to the edge.
We must start with bipartisan collaboration. We cannot delay. The stakes are too high. Now is the time to start to reduce the deficit, cut spending and work to contain inflation.
— Bernard Featherman is a past president of the Biddeford-Saco Chamber of Commerce. His column appears on alternate Thursdays. To contact him, email Bernard@Featherman.com.
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