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Saturday, November 17, 2012

Where we're headed

Europe is back to recession. We'll be there soon, unless we get our politicians to make serious cuts in government spending, of which there is no sign. Ever since the 1974 Congressional Budget Reform Act, all federal budgets have increased annually by as much as 10%, regardless of revenue and regardness of necessity. Any "cuts" we've seen since then have largely affected the rate of budget increases, as opposed to actually decreasing budgets. This is a far cry from zero-based budgeting. Europe's "austerity" measures aren't working because they're not making big cuts: tax increases alone do not close budget gaps because tax increases lead to increased unemployment leading to more benefits and less tax revenue.

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