Fiscal Irresponsibility and The Democrat Rhetoric

Hypocrisy continues to be the mainstay of Democrats and their publicists in the mainstream press on both a state and national level. Here are a couple of recent examples of putting political posturing ahead of facts and reason.

1. President Obama and his hallelujah chorus in Congress and the broadcast media have been whining about continuation of current tax rates first adopted under President Bush. The message is that we cannot afford to borrow $700 Billion to give tax cuts to the rich.

Let’s break it down. First, there are no tax cuts pending – not for the rich, poor or middle income earners. The question is whether you are going to increase taxes or maintain them at the current levels. Second, “the rich,” apparently, are those earning more than $125,000 per year ($250,000 for married couples). That includes 800,000 small business owners – the backbone of job creation in America. Most small business owners pay taxes based at individual earners rates – not corporate rates. And third, and most important, the $700 Billion isn’t caused by continuing current tax rates. It’s caused by a continuation of spending more than you can afford.

For President Obama and his congressional minions to argue that the nation is going to have to borrow $700 Billion to pay for tax cuts is the moral equivalent of me buying a house I can’t afford and blaming my employer for not compensating me enough to meet the mortgage payments.

2. To Oregonians demanding that state government live within its means and reduce spending to meet Oregon’s nearly $4 Billion projected revenue shortfall, Governor-elect John Kitzhaber and his Democrat colleagues routinely respond by demanding that they identify the programs they want the legislature to cut. Let’s break that down.

First, it is done so that, no matter what program is identified, the Democrats can wheel out a “victim” and decry as “heartless” the advocates for responsible spending. After accumulating a body of “victims” the Democrats – as day follows night – then conclude that the only solution is to raise taxes.

Second, no person who has run a business or even managed a segment of a business, begins the management of budget cuts by the wholesale elimination of whole segments of the business. Trying to reduce a whole body of management expertise to a few paragraphs is unrealistic but here is a broad outline of how to proceed:

a. Identify the core functions of state government and eliminate those programs that are unrelated to those core functions. In state government, one might start with the myriad of special interest bureaus and commissions – racial advocacy, ethnic advocacy, gender advocacy, etc.
b. Review the core functions to determine whether they are being delivered in the most efficient manner and to those actually eligible.
c. Elimination of services to those not legally in the United States would substantially reduce the costs of welfare, healthcare services and education.
d. Review and enforcement of eligibility requirements for welfare and healthcare services for residents would further reduce the costs.
e. Given that the largest cost of state government is labor, that means the review should include determining the minimum number of people necessary to maintain a program or function (that includes the number of administrators required and the number of levels of management required), the skill level necessary to perform each function (do you really need a college degree to perform a ministerial function), the fair market value of each function (whether the compensation is in excess of private sector equivalencies), and whether the function can be performed more efficiently by outsourcing it to the private sector.
f. Review benefits and adjust them to meet private sector market equivalencies.
g. Review and reduce travel costs. There should be no travel or meetings unless it can be demonstrated to reduce costs by more than its cost, or produce revenue in excess of its costs. Modern technology is now so pervasive virtually all meetings can be conducted electronically with the attendant savings and the increased productivity lost by downtime during traveling.

And there are just as many things that you don’t do when managing a budget reduction:

a. You don’t hire additional people even if the public employee unions who finance your campaigns demand it.
b. You don’t grant raises twice a year to people even if the public employee unions who finance your campaigns demand it.
c. You don’t declare reform of the PERS system (whose unfunded future liability now exceeds the entire biennial budget and which adds about a thirty percent surcharge to labor costs) off limits even if the public employee unions who finance your campaigns demand it.
d. You don’t refuse to outsource work being done by union employees when it is cheaper to do so even if the public employee unions who finance your campaigns demand it.
e. And you don’t utilize “furloughs” to temporarily reduce employees costs even if the public employee unions who finance your campaigns demand it. The furloughs maintain the underlying excessive number of employees, their excessive salaries and their excessive benefits.

Oregonians are paying a lot of money to elected officials and senior managers to provide prudent management of taxpayer funds. But it’s a lot easier to posture and demand more money than it is to make the hard choices attendant to prudent management. It’s high time that these officials and senior managers earn their pay. At the very least, it’s high time that the media begin holding them accountable instead of championing their excesses.

If Obama, Kitzhaber, and their Democrat colleagues know the reality of the situation and continue their public posturing then they are truly hypocrites. If on the other hand, and I suspect these may be the case for many, they actually believe their rhetoric then they will most assuredly drive the limousine over the edge of the cliff through pure ignorance and incompetence.