Fixed Budget

Here’s an idea.

What if we set a ceiling on federal government expenditures. It will be a challenge to decide what that ceiling is but, assuming that such a figure could agreed upon, who could be opposed to it?

The implications would be manifold and not all are necessarily desirable but, I think it deserves some consideration.

It would:

1. Place a premium on maintaining the value of the currency and possibly create an incentive to deflate currency.

2. Provide a mechanism to inversely fund the central government as the economy expands. This addresses the principal of ever increasing budgets as wealth is created.

3. Require policy experimentation to occur in the states or towns instead of universally. This would include social engineering and progressive confiscatory tax experimentation.

4. Ensure that any unanticipated needs of the future will always be funded by the states.

Simply move to the state which has the level of state interference that you desire.

When has the government ever cared about a budget, fixed or otherwise?


Nice thought experiment though.

and.. of course, there would have to be an exception to the rule, in case a war broke out..
then the next thing you know we would have a war, so that they didn't have to abide by the rule...

I believe we've been there and done that with newt's contract with america.

I know what would save a fortune, get rid of government completely and have direct democracy, Where there are no politicians and the people vote for the rules and policies directly, the only people in the "government" buildings are administrators who do the necessary paperwork and have no say over the policies that people choose.

Then with the money saved start to build a massive manufacturing industry and increase exports. With the goal being a nation that is so profitable from exports that its people dont have to pay taxes, or very little taxes.

I realise that will never happen, or be allowed to happen, But government is the biggest obstacle to the common man....

a reply to: dawnstar

Yes, I'm thinking economically, WW2 certainly proved that. However, a substantial portion of our military capability is state-based so there's no reason each state can't adjust their taxes and policies to a war time footing without dissolving the fiscal limitation.

It might also distribute the material and expertise across the states, providing some insulation against attacks on the central authority.

originally posted by: ColaTesla
I know what would save a fortune, get rid of government completely and have direct democracy, Where there are no politicians and the people vote for the rules and policies directly, the only people in the "government" buildings are administrators who do the necessary paperwork and have no say over the policies that people choose.

Then with the money saved start to build a massive manufacturing industry and increase exports. With the goal being a nation that is so profitable from exports that its people dont have to pay taxes, or very little taxes.

I realise that will never happen, or be allowed to happen, But government is the biggest obstacle to the common man....

I agree. In this scenario, the states won't be naturally much better than the federal government but, the mechanism of voting with your feet will tend to punish the bad states and reward the good ones.

It could be a step in the right direction.

originally posted by: In4ormant
When has the government ever cared about a budget, fixed or otherwise?


Nice thought experiment though.

I hear you. If we can take the power out of the hands of the federal government and return it to where it belongs (constitutionally), the federal departments that remain will compete.

The idea is to pit the various remaining federal departments and federal agencies against each other so that almost nothing ever changes or, if it does, the resources move around within the zero-sum game.

a reply to: greencmp

The Treasury would send congress a report stating that a cap on federal spending would hamper their ability to manage crises and reduce confidence among bond purchasers the minute anyone recommended it.

Then some congressional turd, Pelosi comes to mind, would wave it around saying we need to increase spending. For the children of course.

I think it should be capped at no more then 90% of annual receipts, then maybe after 1000 years or so we might put a dent in the debt.

originally posted by: greencmp

originally posted by: In4ormant
When has the government ever cared about a budget, fixed or otherwise?


Nice thought experiment though.

I hear you. If we can take the power out of the hands of the federal government and return it to where it belongs (constitutionally), the federal departments that remain will compete.

The idea is to pit the various remaining federal departments and federal agencies against each other so that almost nothing ever changes or, if it does, the resources move around within the zero-sum game.

It might have worked at some point before the federal government became the nation's largest employer. Too many chairs at the dinner table now

originally posted by: watchitburn
a reply to: greencmp

The Treasury would send congress a report stating that a cap on federal spending would hamper their ability to manage crises and reduce confidence among bond purchasers the minute anyone recommended it.

Then some congressional turd, Pelosi comes to mind, would wave it around saying we need to increase spending. For the children of course.

I think it should be capped at no more then 90% of annual receipts, then maybe after 1000 years or so we might put a dent in the debt.

Yes, there's more to it than that of course and a greater diversity of currencies are critical to any market. Hayek had an interesting idea about private fiat currencies tied to some measurable "basket" of commodities.

originally posted by: In4ormant

originally posted by: greencmp

originally posted by: In4ormant
When has the government ever cared about a budget, fixed or otherwise?


Nice thought experiment though.

I hear you. If we can take the power out of the hands of the federal government and return it to where it belongs (constitutionally), the federal departments that remain will compete.

The idea is to pit the various remaining federal departments and federal agencies against each other so that almost nothing ever changes or, if it does, the resources move around within the zero-sum game.

It might have worked at some point before the federal government became the nation's largest employer. Too many chairs at the dinner table now

While it very difficult to reduce a power once it is granted, it isn;t impossible. I think it's just a matter of how fast to dissolve the central authorities to accommodate the transition back to a constitutional republic.

originally posted by: greencmp

originally posted by: In4ormant

originally posted by: greencmp

originally posted by: In4ormant
When has the government ever cared about a budget, fixed or otherwise?


Nice thought experiment though.

I hear you. If we can take the power out of the hands of the federal government and return it to where it belongs (constitutionally), the federal departments that remain will compete.

The idea is to pit the various remaining federal departments and federal agencies against each other so that almost nothing ever changes or, if it does, the resources move around within the zero-sum game.

It might have worked at some point before the federal government became the nation's largest employer. Too many chairs at the dinner table now

While it very difficult to reduce a power once it is granted, it isn;t impossible. I think it's just a matter of how fast to dissolve the central authorities to accommodate the transition back to a constitutional republic.

One could always absorb a good portion back into the state level. Reduction of federal taxes to a bare minimum while increasing the state tax to compensate for the increased workforce. This would give the states the power I think they should have. The fixed budget could then be applied at a state level and more easily controlled by its citizens.

a reply to: greencmp

The American budget never have a care about budgets, the reason for this is that under our system of government our nation have its own currency, something that the government in its world standing position can use at will, relying on his most precious commodity, its tax payer population.

This ensure that whenever the government is in need of cash it just fire the presses and have the tax payers pay for it.

originally posted by: In4ormant

originally posted by: greencmp

originally posted by: In4ormant

originally posted by: greencmp

originally posted by: In4ormant
When has the government ever cared about a budget, fixed or otherwise?


Nice thought experiment though.

I hear you. If we can take the power out of the hands of the federal government and return it to where it belongs (constitutionally), the federal departments that remain will compete.

The idea is to pit the various remaining federal departments and federal agencies against each other so that almost nothing ever changes or, if it does, the resources move around within the zero-sum game.

It might have worked at some point before the federal government became the nation's largest employer. Too many chairs at the dinner table now

While it very difficult to reduce a power once it is granted, it isn;t impossible. I think it's just a matter of how fast to dissolve the central authorities to accommodate the transition back to a constitutional republic.

One could always absorb a good portion back into the state level. Reduction of federal taxes to a bare minimum while increasing the state tax to compensate for the increased workforce. This would give the states the power I think they should have. The fixed budget could then be applied at a state level and more easily controlled by its citizens.

Precisely, and I think it is conceivably achievable. A fact that differentiates it from just about any other reform concept.

originally posted by: marg6043
a reply to: greencmp

The American budget never have a care about budgets, the reason for this is that under our system of government our nation have its own currency, something that the government in its world standing position can use at will, relying on his most precious commodity, its tax payer population.

This ensure that whenever the government is in need of cash it just fire the presses and have the tax payers pay for it.

They have definitely expended whatever credibility that they may have ever had. Free markets allow commodities and services to be brought to market by private interests, currencies are just commodities and they should't be controlled by federal or state government (although the states could experiment).

a reply to: greencmp

But they are owned by the private sector while we think is controlled by the government, the truth of who and how our economic is controlled was exposed during the 2008 market crash, when the government rather than let the private sector face the consequences of their corrupted actions made the public and tax payer bail them out.

And will happen again and again and again.

a reply to: marg6043

Until we take money creation and deficit spending away from the federal government. As informant mentions, the problems won't go way immediately but, we can try 50 different ways to fix it.

a reply to: greencmp

I think the easiest way to do that would be to pass a new Amendment setting the tax rate at a fixed flat percentage and setting the annual budget to the amount of tax receipts per annum.

It would not be a capped amount, but it would be wholly dependent on the health of the economy. Only a healthy, growing economy would return more in taxes to increase the budget. The other options - spending more and raising tax rates - would be off the table as per the Amendment.

a reply to: ketsuko

That has been the problem to date though. Even a balanced budget amendment isn't enough.

In this scenario, as the economy improves, the budget for the federal government will decrease with respect to the country's actual GDP. That's critical because all other models allow for the growth of the federal government.

a reply to: greencmp

Well, as to the spending, it won't matter what you do there. It's like anything ... pass a law and they will break it. It is a constitutional obligation for them to have a federal budget every year too, but they loopholed that puppy ever so conveniently now didn't they?

But since we are unlikely to get enough people to agree to repeal the income tax amendment, we might have much better luck drumming up support for a fixed tax rate amendment. That would at least limit the amount of favoritism and cronyism that comes along with all the loopholes and rebates and other crap that gets put into the tax code to pick winners and losers and does build real incentive into the idea of a strong economy as the only way to raise real revenue.