Hillary’s ideas for her economy have varying levels of appeal. They include free college, major expenditures on infrastructure, improved health and elder care, “help parents balance work and family” and an absurd $15 national minimum wage (leading to greater loss of jobs in many states with much lower costs of living). Unfortunately, they would require us accept a race to see which means of funding destroys us first:
- Taxing all of us to death which kills the economy because government is never as financially efficient as the marketplace.
- Redistributing wealth by taxing the wealthy much more which drags us into widespread socialist poverty a la the old Eastern Bloc (which the liberal Baby Boomers conveniently forget and Millenials weren’t taught).
- Destroying us with unsustainable debt, either by putting us at the mercy of foreign creditors if their holdings on us are sufficient or devaluing our currency to nothingness and start a domino defaulting express of government securities.
We are certain lose catastrophically either way.
The Donald starts with budget cuts. Good luck, because:
“Mandatory spending is currently estimated to be $2.606 trillion for FY 2017. That’s nearly two-thirds of all federal spending and is a new record. It’s also three times more than the military budget…Federal law dictates that all mandatory programs must be funded. For this reasons, they are outside of the annual budget process that governs discretionary spending. (Source: Congressional Budget Office, Mandatory Spending Control Mechanisms)…”
“It literally takes an act of Congress to change a mandated program. For example, Congress amended the Social Security Act to add Medicare. However, Congress has a difficult time reducing the benefits entitled under any mandated program. Most consider it political suicide because such cuts guarantee voter opposition by the group receiving fewer benefits. That’s one reason mandatory spending continues to grow.”1
His other plans hinge on significantly restoring the US economy in order to pay for rebuilding the military, saving Social Security, effects of new trade deals, securing our border and winning the war on terrorism. Regardless of how healthy our own economy is, it will always be somewhat dependent on the world economy as a whole. It’s difficult for any nation to have a robust economy if most of the world is destitute.
We could very well lose with Trump, but it’s a sure thing with Clinton.
The lesson is this:
If basic economics were taught in high school and college, candidates wouldn’t even try to present these simplistic and risky ideas.
1 – “Mandatory Spending: Definition, Programs, Impact,” by Kimberly Amadeo, http://useconomy.about.com/od/glossary/g/mandatory_spend.htm, 7/5/2016.