Spending and Debt
Depending upon their definition of "balanced," up to forty-three states,
Pennsylvania among them, have an obligation to balance their budgets, but,
in recent years, very few, including the commonwealth, have been able to do
so without the infusion of massive amounts of newly borrowed or just-printed
In fiscal year 2011 state budgets will need at least $84 billion in federal
funds – Pennsylvania needed $1.9 billion – but will still face billions of
dollars of additional shortfalls. Pennsylvania is among those seeking
additional funding. This causes very serious problems at all levels of
The 10th Amendment to the United States Constitution reads: "The powers not
delegated to the United States by the Constitution, nor prohibited by it to
the States, are reserved to the States respectively, or to the people."
The Amendment is in trouble.
The first dollar a state accepts from the federal government to provide the
services with which that state is legitimately charged erodes the 10th
Amendment. Accepting huge amounts of federal dollars to fund nonfederal
activities not only erodes the amendment, it undermines the will of state
legislators and policy-makers to defend the sovereignty the amendment
guarantees to their states. In this way, the national government expands,
unchecked, beyond its constitutional limits at the expense of the states
and, by extension, the people.
The effect is what physicists and business people refer to in their
disciplines as incremental degradation. Applied to governments, incremental
degradation means one diminishment of freedom at a time enabled by one small
assumption of power until freedom is effectively lost.
The phenomenon is seen most prominently in historically blue states where
the current administration and majorities in Congress find it most
desirable, even necessary, to disguise the failures of those governments
with which they have the closest ideological affinity, states like
Pennsylvania whose dysfunctional governments are least able to live within
their means. Those which receive federal funds burden all American
When politicians pledge to fix these problems, it’s time for everyone to pay
very close attention.
In a functioning republic, up to the point at which constituents become
subjects, the appetites of the ruling elite cannot be satisfied without at
least the appearance of success of their policies. Politicians, more than
anyone, understand that perceptions are realities in the eyes of perceivers.
If they wish to control our lives, and they do, they must control the
perceptions of a majority of voters to preserve an operating majority and
In order to manipulate public opinion, politicians in power and their allies
work very hard to set and control the dialog. They must, because a
well-informed populace is often bad for business. Accordingly, the
vocabulary of the debate is crucial.
For example, in their explanations for and rationalizations of deficits, we
hear a great deal from progressive politicians and their enablers in the
press about shortfalls in Treasury receipts and very little about excessive
government spending. In this way, we are set up for tax increases.
Tax increases are not meant to reduce deficits; they are passed only in the
belief that they will increase revenues. By ignoring spending as the cause
of deficits and the resulting debt, the political class would have us
believe that declining tax revenues are the only explanation for deficits.
Though they attempted to make this false argument throughout the profligacy
of the most prosperous Bush years when Treasury revenues were at record
levels despite the Bush tax cuts, it is virtually impossible to make this
case in boom times.
However, it is one more easily made to a gullible public in a troubled
economy. As the current crop of administration officials have told us, never
let a good crisis go to waste. Since money is power, the ruling elite’s
answer to deficits is always more taxation, allowing them greater access to
our hard-earned cash.
The truth is that politicians have overcommitted and overspent and continue
to do so. Now they are lying to us, not just about the reasons for America’s
and Pennsylvania’s financial problems, but about the solutions.
When families have budgetary problems, want or need more money, breadwinners
look for better paying or take on additional jobs. If jobs are not available
or second jobs not a practical option for some, families moderate or reduce
spending. In proud working families, income is gained by personal effort,
only seldom by taking – and then as a last resort.
Governments only take.
In Washington, in state capitals like Harrisburg and in municipalities
raising taxes has become a weak, reflexive response to excessive spending, a
decision made by weak people, and an act that only worsens economic
uncertainty and deepens the problems we face. Politicians at all levels will
face even tougher decisions when the massive federal stimulus dries up.
Though it clearly encroaches on state sovereignty, excessive federal
spending is most dangerous to the nation. Spending is very much like the
mistletoe that many use to decorate their homes at Christmas. Mistletoe is a
parasite. In nature, it lives in the branches of and invades oak trees,
eventually growing into the heartwood and destroying the host.
Their natural instincts, observable over generations, make politicians’
policy decisions predictable in most domestic crises. In the current fiscal
crisis, spending and the resultant debt are the mistletoe. Many national
politicians will miss or ignore that America is the oak tree.
Shenk is a retired sales and marketing professional living in central
Pennsylvania. He is co-editor of "Rebuilding America, Federalist Papers 2,"
and he was involved with the congressional campaign of Frank Ryan. He can be
reached at [email protected]