75-10-B5
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Congress vs Local Government
TranscriptEvery time I soften up a bit and think maybe I should spend these few minutes giving helpful hints on gardening or how to keep your dog from putting his paws on your new white suit, government comes up with a new one that stiffens my back. Incidentally you can cure your dog of putting his paws in your white suit by stepping on his hind feet when he stands up. Not hard mind you, just a little. Here's a news item that should make all of us perk up. The Joint Economic Committee of Congress says a study of 48 states and 140 local governments reveals that local and state governments are retrenching and cutting back spending by something in the neighborhood of eight billion dollars a year and that's a nice neighborhood. With the government's federal, state and local taking virtually half of every dollar earned in the United States, this news of reduced government spending should be cause for dancing in the streets. But that's not the way the Congressional Committee sees it. They're downright unhappy and that should scare all of us for what it reveals about government's thinking. The committee says this action by local government will remove eight billion dollars in overall purchasing power from the economy at a time when the Federal government is attempting to pump it up by increasing its spending. Increased federal spending is the cause of inflation. Inflation is the cause of the sagging economy. What makes them think that eight billion dollars left in the hands of those who earned it, won't be more wisely spent than if it's spent by bureaucracy? The truth is money spent by government doesn't have the multiplier effect of money spent in the private sector. Indeed government spending is a drag on the economy and slows economic recovery. The Congressman who chairs the committee says, quote, "We must find some method for stabilizing state and local government budget actions so that we can have all levels of government working together." Unquote. And he went on to explain that he meant working together to solve the economic problems. It's time we all realize that government is not the answer to our economic problem. Government is the problem and this kind of ridiculous thinking makes that very clear. State and local governments do almost as much spending as the federal government and between them they're responsible for about one-third of the gross national product. That I submit is a percentage which a free enterprise system can't long tolerate and still remain free. If you don't mind a personal recollection, every time we produced a surplus in California state government while I was governor, we gave it back to the taxpayers in the form of one-time rebates or bonuses. Usually we did this by way of the state income tax. For example, a 250 million dollar surplus allowed us to tell the taxpayers to figure their income tax and then only pay eighty percent of it putting the other twenty percent back in their pockets. The last such surplus rebate was by way of both the income and the sales tax and amounted to 850 million dollars. We had great resistance from the majority in the legislature who evidently shared the same philosophy as this joint Congressional committee. One state Senator said he considered giving that money back to the taxpayers a, quote, "unnecessary expenditure of public funds" Unquote. That one makes you shake your head a little. During the eight years we return to the people more than five billion dollars. The reason I tell this is because until eight years ago, California's rate of inflation was consistently higher than the national average. For six of the last seven years it was lower. Do you really need government telling you how your money should be spent let alone spending it for you? This is Ronald Reagan. Thanks for listening. |
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