Two Billionaires’ Big Plan to Shrink Government
Two Billionaires’ Big Plan to Shrink Government
https://www.youtube.com/watch?v=bTyCKGYG89M
Tag: spending
Budget Deficit Hit $1.8 Trillion After Huge Increase in Borrowing Costs
“The federal government posted a $1.8 trillion budget deficit during the fiscal year that ended on September 30, despite an increase in tax revenue, thanks to higher spending and the rapid growth of interest costs tied to the $35.6 trillion national debt.”
https://reason.com/2024/10/09/budget-deficit-hit-1-8-trillion-after-huge-increase-in-borrowing-costs/
Biden and Harris’ Record on Spending and Debt Is a Tragedy of Epic Proportion
“According to brand-new Congressional Budget Office (CBO) numbers, the 2024 budget deficit is around $1.8 trillion. It’s heading to $2.8 trillion in 10 years, assuming a very rosy scenario. Worrisome too is that interest payments on government debt will eat up over 20 percent of revenue in 2025. As the Hoover Institution’s Joshua Rauh noted, if you remove the revenue earmarked for the Social Security Old Age and Disability Insurance program, that number jumps to 27.9 percent and rising.”
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“Three months into the term and four months after the last $900 billion COVID-19 relief bill, the Biden-Harris administration pushed through another $1.9 trillion bill. This spending was so out of proportion with the state of the economy, which faced an output gap of only $420 billion, that we suffered the worst inflation in 40 years. This wasn’t just a serious hit to the deficit—it also cost the typical family more than $10,000.
The administration then decided to push several large, unpaid-for bills. Riedl lists some: “$1.4 trillion in new spending in omnibus appropriations bills, $620 billion in student loan bailouts, $520 billion for new veterans’ benefits, a $440 billion infrastructure law, a semiconductor bill, and $360 billion in new [Supplemental Nutrition Assistance Program] and health spending forced through by executive order.”
Some economists wrongly insisted that adding debt is no big deal as long as interest rates are low. This condition certainly doesn’t apply to the Biden-Harris spending spree. Add it all up, including interest payments on the debt, and you get $5 trillion on top of what was already there.”
https://reason.com/2024/10/10/biden-and-harris-record-on-spending-and-debt-is-a-tragedy-of-epic-proportion/
DOGE Can Succeed by Scaling Back Its Ambitions
“is DOGE doomed to fail? Not if its architects take a more realistic approach to cutting government. Fundamental reform of Social Security, Medicare, and Medicaid will require delicate, bipartisan negotiations that are already taking place within parts of Congress. Senate Democrats will not back down from filibustering a partisan GOP Social Security plan just because Musk and Ramaswamy recommended it in a report. Nor will Congress suddenly drop its longstanding opposition to eliminating entire federal departments.
Republicans need to stop overpromising and underdelivering on federal budget policy. Congressional Republicans unrealistically promise to balance the budget within a decade while not even attempting to pass any actual legislation slowing the growth of spending. Musk promises to zero out one-third of federal spending, and Ramaswamy pledges to fire three-quarters of federal employees. It’s all bluster to compensate for ultimately doing nothing.”
https://reason.com/2024/11/21/doge-can-succeed-by-scaling-back-its-ambitions/
Trump Has No Discernible Interest in Fiscal Responsibility
“By the end of Trump’s term, the Committee for a Responsible Federal Budget calculated, he had signed legislation and issued executive orders that, on balance, added $8.4 trillion to the national debt (including interest) over 10 years. As of last June, the corresponding figure for President Joe Biden was $4.3 trillion.
During his 2024 run, Trump expressed approximately zero concern about any of this. To the contrary, the Republican platform in effect promised more borrowing to finance “large tax cuts,” an expanded military budget, and “the largest deportation operation in American history.”
The platform also promised that Trump would “fight for and protect Social Security and Medicare with no cuts, including no changes to the retirement age.” Given the looming financial crises in those entitlement programs, which will include mandatory, across-the-board cuts to Social Security benefits in a decade, that commitment is utterly reckless.
Adding together all of Trump’s promises, the Committee for a Responsible Federal Budget estimated that his fiscal plans would add about $7.8 trillion to the national debt over 10 years. The corresponding estimate for Vice President Kamala Harris was about $4 trillion.”
https://reason.com/2024/11/13/trump-has-no-discernible-interest-in-fiscal-responsibility/
To Succeed at Cutting Government, Musk and Ramaswamy Must Take on Entitlements
“First, it’s not as if there is some secret knowledge to be uncovered by the DOGE when it comes to fixing the rampant inefficiencies of the federal government. Those Medicare and Medicaid overpayments are documented annually, for example. The Government Accountability Office and various inspectors general file regular reports. The Congressional Budget Office maintains a list of things that could be cut to reduce the deficit. Various members of Congress—most prominently, Sen. Rand Paul (R–Ky.)—periodically publish lists of silly, wasteful, or dubious government spending.
What’s lacking, in short, is not ideas but the political will to act on them.
The amount of political will is going to matter, because that is very relevant to the second point: Unless Trump is willing to set aside his promise not to touch America’s entitlement programs, the DOGE will be unable to follow through on its mandate.
Again, look at those improper payments made by Medicare and Medicaid. The $101.4 billion of improper payments the two entitlements made in 2023 accounted for 40 percent of all improper payments across the entire government that year, according to the GAO. That same GAO report suggested a simple change in how Medicaid bills some of its services that, if implemented, could save $141 billion over 10 years.”
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“The same problem pops up when you start looking at other big swings that the DOGE could take. Seven of the top nine suggestions made by the Congressional Budget Office’s annual report on “options for reducing the deficit” involve changing elements of America’s three federal entitlement programs. Capping Medicaid spending, increasing premiums for Medicare Part B, or reconfiguring how Social Security benefits are paid to wealthier Americans each could save hundreds of billions of dollars over the next decade. None will be possible as long as entitlement reform is off the table.
All of this is a function of the federal government’s fiscal reality: Entitlements are the biggest and fastest-growing segment of the budget. This year, so-called “mandatory spending”—primarily Social Security, Medicare, and Medicaid, along with a few other government-funded health care programs—will cost nearly $4 trillion, while all discretionary spending will total less than $1.8 trillion.
Musk has promised $2 trillion in spending cuts, but he could propose eliminating all discretionary spending—good luck zeroing out the Pentagon—and would still fall short of that goal. It is impossible to be serious about fiscal reform while promising not to touch the entitlement programs.”
https://reason.com/2024/11/13/to-succeed-at-cutting-government-musk-and-ramaswamy-must-take-on-entitlements/
Data shows migrants aren’t taking jobs from Black or Hispanic people, despite what Trump says
“government data show immigrant labor contributes to economic growth and provides promotional opportunities for native-born workers. And a mass deportation event would cost U.S. taxpayers up to a trillion dollars and could cause the cost of living, including food and housing, to skyrocket, economists say.”
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“The latest U.S. Bureau of Labor Statistics Current Population Survey data shows that as of 2023, native-born Black workers are most predominantly employed in management and financial operations, sales and office support roles, while native-born Latino workers are most often employed in management, office support, sales and service occupations.
Foreign-born, noncitizen Black workers are most often represented in transportation and health care support roles, and foreign-born, noncitizen Hispanic workers are most often represented in construction, building and grounds cleaning.
How has immigration contributed to U.S. growth?
In 2023, international migrants — primarily from Latin America — accounted for more than two-thirds of the population growth in the United States, and so far this decade they have made up almost three-quarters of U.S. growth.
After hitting a record high in December 2023, the number of migrants crossing the border has plummeted.
The claim that immigrants are taking employment opportunities from native-born Americans is repeated by Trump’s advisers. They often cite a report produced by Steven Camarota, research director for the Center for Immigration Studies, a right-leaning think tank that seeks a reduced immigration flow into the U.S. The report combines job numbers for immigrants in the U.S. legally and illegally to reinforce the claim that foreigners are disproportionately driving U.S. labor growth and reaping most of the benefits.
Camarota’s report states that 971,000 more U.S.-born Americans were employed in May 2024 compared to May 2019, prior to the pandemic, while the number of employed immigrants has increased by 3.2 million.
It is true that international migrants have become a primary driver of population growth this decade, increasing their share of the overall population as fewer children are being born in the U.S. compared with years past. That’s according to the U.S. Census Bureau’s annual American Community Survey.
Are immigrants taking native-born workers’ jobs?
Economists who study immigrant labor’s impact on the economy say that people who are in the U.S. illegally are not taking native citizens’ jobs, because the roles that these immigrant workers take on are most often positions that native workers are unwilling to fill, such as agriculture and food processing jobs.
Giovanni Peri, a labor economist at the University of California, Davis, conducted research that explores the impact of the 1980 influx of Cuban immigrants in Miami (the so-called Mariel Boatlift) on Black workers’ employment. The study determined that the wages of Miami’s Black and Hispanic workers moved above those in other cities that did not have a surge of immigrant workers.
Peri told the AP that the presence of new immigrant labor often improves employment outcomes for native-born workers, who often have different language and skill sets compared to new immigrants.
In addition, there are not a fixed number of jobs in the U.S., immigrants tend to contribute to the survival of existing firms (opening up new opportunities for native workers) and there are currently more jobs available than there are workers available to take them. U.S. natives have low interest in working in labor-intensive agriculture and food production roles.
“We have many more vacancies than workers in this type of manual labor, in fact we need many more of them to fill these roles,” Peri said.
Stan Marek, who employs roughly 1,000 workers at his Houston construction firm, Marek Brothers Holdings LLC, said he has seen this firsthand.
Asked if immigrants in the U.S. illegally are taking jobs from native-born workers, he said, “Absolutely not, unequivocally.”
“Many of my workers are retiring, and their kids are not going to come into construction and the trades,” Marek said. He added that the U.S. needs an identification system that addresses national security concerns so those who are in the country illegally can work.
“There’s not enough blue-collar labor here,” he said.
Data also shows when there are not enough workers to fill these roles, firms will automate their jobs with machines and technology investments, rather than turn to native workers.”
https://www.yahoo.com/news/data-shows-migrants-arent-taking-040445122.html
Crypto is betting it all on the 2024 elections
“Crypto has spent a record $119 million in the 2024 federal elections, magnitudes more than it has ever spent before. This huge number means that crypto accounts for almost half of all corporate political contributions in this cycle. Its spending since 2010, totaling $129 million, puts the industry second only to fossil fuels, according to a report from the progressive consumer advocacy group Public Citizen.
“It’s already 15 percent of all known corporate contributions since the Citizens United ruling,” says Rick Claypool, a research director at Public Citizen who authored the report on crypto election spending, referring to the landmark 2010 Supreme Court decision that opened the floodgates for virtually unlimited corporate spending in elections through outside groups.
Crypto’s ballooning political war chest and voracious appetite to dangle money in front of lawmakers speaks to the power it has amassed over the past decade and a half, even as it has struggled to gain any real traction with the public.
Three-quarters of Americans who’ve heard of crypto aren’t confident in its safety and reliability, a 2023 Pew Research survey found, and only 7 percent of Americans used crypto last year, according to the Federal Reserve. Crypto’s reputation suffered in particular from the controversy surrounding crypto companies in the last few years, especially the catastrophic meltdown of FTX. Though the first cryptocurrency was launched in 2009, it still hasn’t penetrated as a mainstream payment method, with very few retailers allowing customers to pay directly with cryptocurrency. It remains mostly a vehicle for speculative investment.
Despite that — or because of it — crypto companies have redoubled their efforts to help elect pro-crypto politicians and lobby for policies that would boost the sector’s growth. The industry wants the influx of money it’s spending to send the clear message that the crypto craze isn’t over — and in fact, isn’t a craze at all, but the lasting future of finance. “Crypto is here to stay,” Paul Grewal, Coinbase’s chief legal officer, recently wrote in public comments regarding regulation.
The sector’s most strident champions want you to believe that it’s a key issue for voters in the upcoming election, right next to inflation and health care. The industry is shouting from the rooftops that politicians can’t ignore crypto — and trying its hardest to make sure we won’t be able to either.”
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“After a rough few years of being walloped by scandals and government crackdowns, crypto is facing an existential crisis. There are already some patchwork regulations governing the world of digital currencies, but one key issue remains hotly debated: Which government agency should oversee them?
In the US, securities like stocks and bonds have to be registered with the Securities and Exchange Commission (SEC), which comes with a host of disclosure requirements and other rules to protect investors.
As far as the SEC is concerned, the law already puts most cryptocurrencies squarely under its purview, and the agency has been aggressively pursuing enforcement against crypto exchanges like Coinbase and Binance, alleging that they’re running unregistered securities exchanges. But the crypto industry doesn’t want to be regulated by the SEC — it wants to fall under the Commodity Futures Trading Commission (CFTC) instead.
“The CFTC is a much smaller agency with far fewer resources,” says Molly White, a crypto researcher and critic who has been tracking the industry’s political spending.”
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“One major change this election cycle is how much more visible and vocal the Trump-supporting faction of crypto proponents has become. Cameron and Tyler Winklevoss, who founded the crypto exchange Gemini, tried to donate roughly $1 million worth of bitcoin each directly to the Trump campaign, apparently unaware it would exceed the FEC contribution limit. Venture capitalists Marc Andreessen and Ben Horowitz have both affirmed that they’re joining Team Trump too. Other backers include Jesse Powell, co-founder of the crypto exchange Kraken, and Charles Hoskinson, co-founder of the ethereum blockchain.
It’s worth noting that when Bankman-Fried was still the biggest face of crypto, he was known as a Democratic megadonor. We only found out later that he’d contributed roughly the same amount to Republicans through dark money groups.
Trump, for his part, was a harsh crypto critic in the past, but has recently done a 180, saying he would end Biden’s “war on crypto,” and that he would fire Gensler, the SEC chair. He even recently announced a family crypto project, run by the Trump Organization, called The DeFiant Ones — a play on “decentralized finance” — that would, according to Trump, help Americans who have been “squeezed by the big banks and financial elites.”
But crypto’s partisan inclinations are more complicated than simply supporting Republicans.
The industry’s spending is funneled mostly through the pro-crypto super PAC Fairshake, which has already spent $93.8 million this election cycle and is the second best-funded super PAC in the election, after Trump-backing Make America Great Again Inc. Fairshake’s backers include Coinbase, which has contributed a total of $50 million to the 2024 elections so far, and Ripple, a blockchain payment network that spent $49 million. (Both Coinbase and Ripple have faced SEC lawsuits.) Venture capital firm Andreessen Horowitz has also contributed $47 million to Fairshake.
Fairshake largely focuses on House and Senate races, and has been largely nonpartisan, supporting and opposing politicians of both parties based on their crypto stance.”
https://www.vox.com/money/371597/crypto-politics-spending-2024-elections-trump
Mike Pence’s Sensible (and Probably Doomed) Plan To Fix the National Debt
“To get the debt under control, AAF points out that lawmakers cannot simply focus on the discretionary part of the federal budget—which accounts for less than 30 percent of all federal spending. Meanwhile, so-called “mandatory spending” accounts for more than 60 percent (the rest is interest payments on the debt).
Most of the mandatory spending category is made up of Social Security and Medicare, but several other programs also run on autopilot, including food stamps, federal worker retirement benefits, Obamacare’s health insurance subsidies, and veterans’ benefits.
“Mandatory spending is the biggest driver of the national debt because there is no restriction on the unchecked growth of these programs,” argues AAF’s debt report.
Among the proposals to bring mandatory spending under control, the group argues for means-testing future Social Security cost-of-living adjustments (COLAs) for individuals making more than $1 million annually, stopping President Joe Biden’s student loan cancellation plans, ending Obamacare’s insurance subsidies for wealthy Americans, and the formation of a congressional commission to propose spending cuts.
The group also calls for ending so-called “tax expenditures,” which are forms of spending hidden in the tax code—for example, corporate green energy subsidies delivered in the form of renewable tax credits.
The new document picks up where Pence left off in his failed Republican primary campaign last year. On the campaign trail, Pence talked up the importance of sane fiscal policy and condemned his former boss—Republican presidential nominee Donald Trump—for ignoring the threat posed by runaway borrowing and unsustainable entitlement programs.
Of course, Pence’s campaign never got off the ground in any meaningful sense. Former South Carolina Gov. Nikki Haley had a little more success, but there’s clearly not much of a constituency for serious talk about the debt.”
https://reason.com/2024/08/09/mike-pences-sensible-and-probably-doomed-plan-to-fix-the-national-debt/
The Russian Economy at War (2024) – Sanctions, growth, inflation & mounting
The Russian Economy at War (2024) – Sanctions, growth, inflation & mounting risks
https://www.youtube.com/watch?v=8tHkwLSS-DE