Follow the money, and you'll see why fiscal policy must change

There’s an old axiom in the news business: “Follow the money.”

 

Following the cash trail led me to some interesting places in my days as a broadcast journalist. However, nothing prepared me for what I found when I joined the federal government.

A call to service in the highest levels of government is humbling. Few are called, and much is expected. At first the opportunity is similar to a repairman who has been given an old car to tinker with. You may not understand how it works; you just know that it does.

 

THE SAME IS true of our national government. Few understand how it works, but we all know that as long as we keep pouring money into it, it seems to chug along. And, we’ve come to accept the fact there will always be enough money. The Federal Reserve can be counted on to keep it flowing like water in a high-pressure hose onto a fire.

Much has been made about the budget deficits racked up under President Obama. Trillions of dollars. Numbers so big we cannot comprehend them. Numbers so big we can’t remember how many zeros are in them. Numbers so big they seemingly have no meaning. The White House website shows four years of deficits totaling $5.68 trillion. Let’s not forget that no spending bill gets to the president without complicity from Congress.

Over the next four years, the president and Congress are expected to add another $3.57 trillion to the national debt that today stands at nearly $17 trillion. Now, we’re talking about following some real money.

In my days in the Bush administration, I served for a time as assistant deputy secretary for field policy and management in the Department of Housing and Urban Development. Pretty big title, but it meant I was responsible for front-office operations in more than 80 HUD field offices around the country. The office budget was about $52 million, and the staff numbered more than 400.

Senior management knew we could save some money in that office, and asked me to get busy. I did. We knew there were too many offices, but closing offices literally takes approval from Congress. With Rep. Barney Frank, D-Mass., and Sen. Chris Dodd, D-Conn., leading the oversight committees, we didn’t stand much of a chance. So, I turned next to personnel.

 

THE OFFICES could be adequately staffed by fewer than 400 employees; we set a target of 383. The first hurdle I had to overcome was establishing a protocol with the union representing HUD workers. Yes, HUD workers have union representation. Once that was out of the way, I was clear to give more than 40 employees reassignments to other HUD programs, full retirements or jobs in other federal agencies.

The net result was I got to the magic number of 383 employees and was positioned to realize $5 million in savings. Real savings. Real money. I felt good about what we had accomplished. The workforce shrunk without anyone being fired and taxpayers were saved a big chunk of change. Or so I thought.

I learned later that my $5 million in savings was not a savings at all. The money was divvied up between the administrative and legal offices within HUD. How could this be? We’re Republicans. We’re supposed to save money and cut the size of government, aren’t we?

As the secretary explained to me, “Bob, we can’t give the money back to the Treasury, because, if we do, we won’t get as much money next year.”

This line of thinking is why it takes so much money to keep our government fed. In fact, in May 2013, each one of us who lives in this country, regardless of status or age, owes $53,300 as our personal share of the national debt. It is a number increasing every minute of every day.

Runaway government spending is perhaps the greatest national security threat we now face – even more devastating that a nuclear missile from North Korea.

We cannot spend our way out of this financial morass. We cannot tax our way out, either. If our income taxes were to double overnight, we still wouldn’t have enough money to balance a budget, let alone to begin making payments on the debt. And you will never find enough waste, fraud and abuse to be a coffer dam for the flow of red ink.

 

A NUMBER OF stars will have to align for meaningful fiscal policy to take hold. Here are a few I observed from my experience as someone who actually cut federal spending:

• People of principle will have to stand on their principles. The purpose of government is not to provide economic development for local communities.

• The safety net of services for the disabled and elderly should be narrowly focused to exclude able-bodied people who should be in school, in job training or at work.

• A strong national defense does not necessarily mean the most expensive national defense. With two land wars ending, our focus should be more strategic.

• Health care should be market-driven. Working with the states, the federal government can craft incentives that result in greater efficiencies and lower costs.

• The purpose of the tax code is to raise money to fund the government. It should not be chopped up to provide special favors for any group or business. Ideally, the current system should be replaced by a consumption tax. The government should never penalize you for working hard.

I know you can add to this list. And you ought to. No one person, no one group, no one political party has all the answers. At least if they do, they’re certainly keeping it a deep secret.

Growing up in Thomson, I looked forward to an ice-cold glass of Kool-Aid after a hard day of play. But over the years, that grand drink has been co-opted by folks who serve it up to you while they pick your pocket. Kool-Aid is now the drink of distraction.

What’s clear is that too much Kool-Aid is being served in the noisy debate on our nation’s economy. It’s time to turn over your glass. Refuse to take another swallow from the pitcher of the status quo.

You owe it to yourself, your family, future generations and to our great nation to demand results. Settle for nothing less. You have no choice. Follow the money, and you’ll reach the same conclusion.

 

(The writer is a former Augusta mayor and current president and CEO of Southeastern Natural Sciences Academy.)

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