Tag Archives: Budget

The Pentagon Spends More on War Than All 50 States Combined Spend on Health, Education, Welfare, and Safety

I realize that the US is a big country and it has a lot of land that it needs to defend, but that seems like an unbelievable figure, doesn’t it? More on war than all 50 states spend on health, education, welfare, and safety — combined!

That’s just one of the many alarming statistics that I found in this post from Business Insider from 3 years ago. As it’s 3 years old, I don’t know if the the title of this post remains true, but I wouldn’t be surprised if it’s far off. I first went digging on this issue because one of the things I’ve been meaning to write about is how much the US spends on defense.

 

As the above graphic shows, the US spends a lot on its military and not just a lot in terms of the amount of money it spends, bit it spends so much more than the country that spends the second most, China. In fact, the US spends more on its military than the next ten countries — combined!

Do you think that the US spends too much on defense spending? If I were answering honestly, I’d have to say probably. According to a Gallup poll from February of this year, a plurality of American seem to agree. And it’s not just average Americans who think the US spends too much on defense, but scholars of international relations.

That’s almost 75% of scholars of international relations who believe that the US spends too much on defense. The post where it comes from even parsed out some of the different types of international relations scholars. For instance, over half of “realists” believe that the US spends too much on defense and “realists” view international relations through the lens that the primary aim of a country (but they would call them states) is survival.

There are probably a whole host of reasons why the US defense budget has inflated to the size that it is. There was one answer I found on Reddit that seemed particularly enlightening:

Because the US military doesn’t just exist to defend the invasion of the physical United States.

As the country with the biggest economy in the world, the US has a vested interest in maintaining a global environment that favorable to its interests.

This means having the power to impose its will (for better or worse) on other countries that act against the US’s interests. To do this the US has to spend an incredible amount of money on research and development to make sure that it has the best military technology while also projecting force abroad to make sure its interests are maintained.

Nonetheless, in a parallel universe, it would be interesting to see how the citizens of the US would survive/thrive in a world where defense budget for the the US is cut in half and that money is redirected to other important areas like health and education.

Would You Rather Pay Fees or Taxes?

A little over a week ago, Matt Yglesias wrote a post on Slate about how to balance the budget while slashing taxes. The solution: call everything a fee.

Well we could solve an awful lot of problems that way. For example, I’d love to see us impose a greenhouse gas emissions fee to internalize the social cost of carbon dioxide. On top of that, I think a small additional fee on the use of gasoline would be justified. And of course road congestion fees on crowded highways. I used to think we should raise the alcoholic beverages tax, but now I think we should eliminate it entirely. Instead, let’s put an “alcohol fee” in place that just happens to be higher than the current tax. Do the same for cigarettes. Legalize marijuana, but subject its sale to a rather hefty fee. It actually turns out that we could replace most taxes on labor and capital with a land occupancy fee, especially if we call it a “land occupancy fee” rather than a “land value tax.”

After reading this post, it made me think of Michael Sandel’s chapter about fines versus fees. Maybe some of the things that Yglesias is talking about in this post should actually be labeled fines and not fees. For instances, if we’re talking about internalizing the social cost of carbon dioxide, isn’t there a moral piece to it? That is, shouldn’t we call this a fine, then? You may disagree, but the nomenclature in this case does matter.

It seems a bit absurd to think that people would be more amenable to paying money for something merely by changing the label from ‘tax’ to ‘fee,’ but labels matter.

While it’s certainly a creative idea to start charging fees and lower taxes, there is an important bit to consider here. Namely, the control of these fees. Have you ever had to pay a fee to get your license renewed? Do you know how much it costs the government to ‘actually’ renew your license? I don’t. But I know that I get charged close to $100 to renew it. Josh Barro solidifies the point:

Politicians tend to regard fees as more palatable than taxes, and more focused too. If a state needs to finance an infrastructure to oversee fishing, why shouldn’t fishermen foot the bill? But groups like the nonpartisan Tax Foundation in Washington worry that governments are now using fees to shore up budget shortfalls rather than cover specific costs incurred by specific users.

“When it comes to paying for bananas, you’ve got the market as a mechanism to make sure you’re paying a fair price,” says Josh Barro, a staff economist at the Tax Foundation. “But when it comes to getting your driver’s license renewed, the government has a monopoly, and you have no idea what it costs the state or what it’s doing with the money.”

The moral of the story: maybe taxes aren’t so bad after all.

Cutting Salary to Show Solidarity: This Isn’t Empathy

A couple of days ago, there was news indicating that President Obama was going to return 5% of his salary, which amounts to about $17,000, as a sign of solidarity with those federal workers who’ve been furloughed. In case you’re not familiar with this situation, I’ll explain a little first.

In 2011, there was the debt-ceiling debacle. One of the things that came of that was the sequester. The sequester was supposed to be such drastic cuts to the federal budget meant as an incentive to make some sort of deal before the deadline. It wasn’t ever meant to happen, (at least that’s what politicians said publicly), and the date set for the deadline to make a deal (and begin the implementation of the sequester if there weren’t a deal) was January 2, 2013. As part of the New Year’s Eve tax deal, Congress pushed the start of the sequester to March 1, 2013, which is when it began.

As the sequester has a great deal of spending cuts, this has greatly affected some of the workers in the federal government. For instance, some workers have had to take furloughs — temporary unpaid leave. Companies (or the government) don’t usually use this unless there’s a need because of the budget situation. As an aside: on Chris Hayes’ new show (All In with Chris Hayes), he went into detail with one particular worker who has had to take furloughs and had a brief panel discussion about it. That brings us back to President Obama.

A couple of days ago, President Obama stated that he was going to return a portion of his salary to show solidarity with those workers who are having to take these temporary unpaid leaves. The President may have started it, but he’s certainly not finishing it. Secretary of State John Kerry, Secretary of Defense Chuck Hagel, Secretary of the Treasury Jack Lew, and Secretary of Homeland Security Janet Napolitano are all showing similar signs of solidarity. So is freshman Congresswoman Tammy Duckworth. But this is not limited to Democrats. Senator Lindsey Graham and Senator Mike Lee have both indicated that they will return some of their salary. I think all of this is well and good, but the one thing that irked me was how Lindsey Graham wrote about his decision on Twitter. (I should note, I don’t know if any of the other politicians have said made similar claims, as I just saw someone retweet Lindsey Graham’s commentary.)

After I saw this tweet, I went on a bit of a rant on Twitter that I’ll include below:

 

Let’s first start with the issue of empathy. People often confuse empathy and sympathy. I’ve written about empathy before:

Empathy is at the heart of the beginning of the solution to many of the world’s problems. When we empathize, we are able to recognize the emotions that another is feeling. At the root of compassion is empathy. [Note: sympathy is quite different from empathy. Sympathy is simply a concern for another’s well-being, where empathy usually refers to one sharing the same emotional state.]

I should note that the “note” in that quote actually comes from the post. So, now that we know what empathy means, let’s return to Senator Graham’s comment. He said he was cutting 20% of his pay to empathize with those furloughed. In order for Senator Graham’s actions to demonstrate empathy, it’d actually have to affect his life in the way that those furloughed are affected. For an example of this, scroll up in this post and watch the video I linked to with Chris Hayes talking to someone who is being furloughed. Senator Graham’s current salary for FY2013 is $174,000. If we take 20% away, that leaves him with about $140,000. Something else that’s important to this conversation is Graham’s net worth, which is now pegged at $1.5 million. I understand that politicians have to keep up two offices (one in DC and one in their district/state), but does anyone think that Senator Graham’s going to have as hard a go as thing with a $140K salary as the military serviceman who had to get a second job delivering pizzas?

This is not empathy.

~

As an addendum to this conversation, I wanted to include data about the current Congress’s net worth, but there doesn’t seem to be a list out there. However, I was able to find a list for all members of Congress in 2010. Some things of note: of 100 Senators, only 7 had a net worth of less than $100,000 and 24 had a net worth of more than $10,000,000. Of the 435 member of Congress, 81 had a net worth of less than $100,000 and 42 had a net worth of more than $10,000,000.