75-12-A4
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Budget "Uncontrollables"
TranscriptWhat goes up must come down, unless it's one of those so-called uncontrollable items in the Federal budget. I'll be right back. Next time your Congressman tells you he wishes something could be done about the staggering cost of Federal government, but it's impossible because so many budget items are uncontrollable, tell him to take a closer look. Tthe non-profit nonpartisan Tax Foundation has just released a new research study titled, "Uncontrollable Federal Budget Outlays." It contains some grim news but some hopeful observations too. According to the study, 75% of the proposed federal budget for the next fiscal year comes under the heading of "relatively uncontrollable costs." The foundation defines this as any budget outlay over which neither the Executive nor Congress can exercise effective control during the year ahead under existing law. Those last three words are key ones. You see past Congresses have passed law after law to create what are called, 'Open End, Fixed Cost Programs' to benefit one group or another. Once the law is passed, the group receiving the benefits invariably grows in size. That's the open end part of it, and costs automatically soar because Congress has fixed the formula for them in the law. You the taxpayer feel it every April 15th. Congress in effect saddles future generations with the decisions of the past, whether or not they remain good ones. In recent years the biggest jump in uncontrollable costs has been in what are called, 'Transfer Payments.' Very simply the passage of welfare-state-type-laws by Congress has caused the federal government to become a transfer agent, collecting dollars from some groups of people and giving them to others. There never seems to be a lack of Congressman to make political hay out of promising one group a bigger slice of pie by reducing someone else's slice. So rather than government getting out of the way to let the free market system create a bigger pie so everyone can have a bigger slice, Congress creates new public assistance programs. Just eight years ago, in 1967, payments to individuals by the government amounted to 44.6% of the uncontrollables in the budget. Next year it will be nearer 64%. There are several things the government can do to bring the uncontrollables under control, among them would be a law requiring that any bill creating a new program be accompanied by a tax bill to pay for it, or an offsetting reduction in existing programs. Also Congress should avoid creating new programs in forms which restrict annual review through the regular budgetary process. This would prevent the automatic surge of growth of programs, of the bureaucratic barnacles, these programs tend to collect if not reviewed. Another proposal worth adopting is a limitation in the use of automatic escalators in benefit programs. These are a substitute for conscientious review and debate and they aggravate the budget problem. Recently a study with the Congressional Joint Economic Committee concluded that most programs in the regular budget review process grow slowly and there are even some important declines, while the so-called uncontrollable programs all have major increases. The uncontrollables can be brought under control, if Congress has the willpower to do so. That's called fiscal responsibility. Is your Congressman practicing it? This is Ronald Reagan. Thanks for listening. |
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