Democrats and Republicans on the Senate Environment and Public Works Committee announced agreement on a bill to increase highway spending by 32 percent. The 2015 transportation bill included $225 billion for highways over five years. The announced agreement is to increase this to $303 billion for the next five years. The agreement said nothing about transit spending.
From 2015 to 2019, revenues into the highway portion of the Highway Trust Fund were about $37 billion a year, so at least $40 billion of the $225 billion allocated in 2015 was deficit spending. Due to the pandemic, revenues are not likely to significantly increase in the next five years, so increasing spending to $303 billion would nearly triple deficit spending.
This is a bad precedent to set considering that Republicans are trying to reduce deficit spending on transit, Amtrak, and other infrastructure. When Senate Republicans responded to President Biden’s proposal for a $2.3 trillion infrastructure plan with a plan that would spend only $568 billion, Biden came back with a $1.7 trillion bill. But the White House and Congressional Democrats won’t take Republicans seriously if Republicans agree to triple deficit spending on roads.
Certainly, Biden’s latest proposal shouldn’t be taken seriously either. While the Republican plan greatly cut spending on transit and non-transportation infrastructure, it would have spent more on highways than the original White House plan. In order to cut its plan from $2.3 trillion to $1.7 trillion, the White House cut highway spending, claiming that was more closely aligned with the Republican plan.
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If Republicans agree to triple deficit spending on highways as apart of the reauthorization bill, they give Democrats the excuse to triple deficit spending for transit in the reauthorization bill. Since all federal transit spending is subsidized, while at least some of highway spending is self-funding, this could represent a massive increase in transit subsidies. Similarly, when Republican proposed an increase in highway spending in the infrastructure bill, all of which would come from deficit spending, they opened the door for even more deficit spending on transit and Amtrak.
If Republicans had demanded that highway spending be limited to highway revenues, they would have a moral and political case for reducing transit and other subsidies. Agreeing to triple highway deficits in the reauthorization bill and to spend nearly $300 billion of deficit funds on highways in an infrastructure bill undermines their arguments that less should be spent on transit, Amtrak, and other activities.
Biden is perfectly happy to deficit spend. His memo to Republicans says that he “fundamentally disagrees with the approach of increasing the burden on working people through increased gas taxes and user fees.” In other words, making people pay for the transportation facilities they use today is bad; making them pay through increased taxes or inflation tomorrow is good. That’s an insane view that Republicans should do everything they can to fight. But they can’t fight it when they support more deficit spending themselves.
republicans liked deficit spending before Biden, did ANYONE pay attention to Trump’s wreckless spending habits?
So why all the dire “news” about European Socialism?
First, American billionaires use every opportunity to bash what they call socialism, i.e. government guaranteed health care and food. We can debate those issues anytime What they don’t want the USA to raise their taxes to European levels in order to guarantee a basic standard of living to all Americans. Second, American bankers want to create a feeling of crisis, so governments will bail them out when the PIIGS nations inevitably default on their bonds, which were sold and insured by big American banks. Third, the economic figures are so bad for the USA that Asian nations were beginning to use the Euro as an international currency. If the Euro is destroyed by EU fracturing then everyone must continue to use American dollars, helping keep our fiat currency afloat.
Books and movies about World War I are not very popular in the US because they are depressing and miserable. In short; The world’s great European powers destroyed a generation of men in pointless bloody battles. Few Americans realize that World War I was America’s worst foreign policy blunder that killed millions; set off US financial state that allowed financing wars thru credit; set the stage for World War II.
When the “Great War” began in 1914, royals and generals hoped for swift victories. However, advances in technology, mostly machine guns and rapid fire artillery, allowed firepower to annihilate whole formations. The war dragged down into a bloody stalemate and ground to a stop for 2 years. The king of England and Germany were first cousins who grew up together, so a peaceful resolution was likely in 1916.
The problem was that British bankers had loaned its government lots of money and most could not be repaid. They wanted to win the war so they could loot Germany by requiring Germans to pay reparations so the British government could repay them. If they could lure the powerful USA to join the war, victory was assured. They blocked peace efforts and used their agents of influence to manipulate the USA into joining the war. Soon after President Wilson was elected with the promise to stay out the war, he worked with Congress to declare war.
As a result, the war dragged on for two more bloody years before enough American men and material arrived in France to turn the tide. The war was unpopular back home, leading Wilson to
censor the US mail by blocking anti-war newsletters and magazines. Sound familiar
– He threw thousands of political opponents in jail
– implemented a draft to fill out the Army, and sent these reluctant Americans into battle with little training and poor equipment. Germans with three years of combat experience and chewed up American units foolishly thrown into frontal attacks that had little chance of success. After four years of war, the Germans had no more manpower to replace losses, and surrendered based on a just peace promised by President Wilson. That never happened and Germany was looted and humiliated, which led to the rise of the Nazis and World War II.
The “Suez Crisis” is considered the official end of the British empire. The British weakened by idiotic World War I that led to bloody World War II. At the end of that war, the British were bankrupt but needed to deal with rebellious colonies. The British still had many troops in Egypt and Middle East. American President Eisenhower and his bankers refused to lend yet more money to an arrogant, overextended and dying empire. This led to a British financial crisis and a controlled collapse.
Warmongering neocons have run American foreign policy for two decades and threaten war everywhere. Should the near bankrupt USA find itself in a pointless war and request assistance from allies, they may refuse and dump dollars instead. This may result in a military defeat along with a financial collapse and domestic political unrest signaling the end of the American empire.
So it goes
Wow, LazyReader certainly put a lot of effort into this response. I do think he is missing the Antiplanner’s main point that both parties are to blame for the mess we’re getting ourselves into. Unfortunately, this is certainly true.
The Republicans love deficit spending. After being given a balanced budget in 2001 where a projected surplus could be used to pay off the deficit they immediately cut taxes on the wealthy and ran the budget into deficit again. Under the Trump administration the deficit went up 36% from $19.9 trillion to $27 trillion in less than four years https://www.thebalance.com/trump-plans-to-reduce-national-debt-4114401.
To get out of this mess requires both reinstating tax cuts and charging users for infrastructure projects. The best way to cut government size is to charge for services. You want a tax cut? Cut government spending. Want more infrastructure? Charge user fees.
@paul
that’s debt, not deficit
You want meaningful spending cuts, Cut defense spending 25%.
Republicans whine it’ll ruin our military, but Pentagon’s budget was 300 Billion in 1960 (2.7 Trillion in todays money) and they had 2 million man army, 600 ship navy and thousands of fighters in the Air Force/reserve/guard. We really did get more bang for our buck back then.
We don’t need 10 Aircraft carriers we can get along fine with seven. 3 in the Atlantic seaboard, 3 in the pacific on California and Hawaii and 1 alternate where needed presumably harbored in a US base like Guam, Mariana islands or Puerto Rico. No aircraft carrier was used during the recent war in Libya because of fear of medium-range anti-ship missiles and the growth of faster hypersonic missiles. Carriers today are very vulnerable against modern nations, although useful for attacking mostly helpless Third World ones. I’m willing to predict that BIG, NUCLEAR powered Aircraft carriers will be obsolete in 20-30 years. The US chooses nuclear power because of range anxiety. An Atlantic round trip is over 7000-8000 miles and some ships have the range to do it. Crossing the Pacific is impossible without a refueling post. Nuclear power eliminates that deficiency but is ridiculously expensive until 4th generation gas cooled reactors or molten salt designs become adapted to power ships (Since refueling solid fuel reactors means tearing the ship down and rebuilding it upon completion)
– The US army has thousands of M1 Abrams tanks, liquedate them or sell them and upgrade the most recent ones. The Army also has thousands of armored MRAP trucks, initially used to protect against roadside bombs in Iraq and Afghanistan, with the winddown, the Pentagon thought they could sell some of them to Police. Besides being gas guzzlers and ridiculously heavy, without spare parts from Oshkosh or International, these vehicles are essentially falling apart.
– Get rid of the V22, one of the more ridiculous money wasters in defense acquisitions.
– Ditch the F-35 and open up a global competition for a modular fighter. US contractors can design electronics/radar, engines and weaponry but the fuselage can be open design.
– Combine military medical services. Each of the armed forces has its own medical corps. An excessive number of Army colonels are doctors. The Navy and Air Force presumably have similar overstaffing, usually based on World War II models. Yet it’s the infantry and Marines who suffer nearly all the casualties in combat. Simplify things but submitting all administration to the Army and train all the branches at the same school/institute.
– Institute co-pays and reforms for healthcare. Tricare costs 50 Billion dollars a year. To provide almost free healthcare to all military retirees AND their families for life, even if they are working in other jobs with health insurance. Even if the person has a job that nets them six figure salary they’re still entitled to basically free healthcare from the taxpayer.
– Retirement policy in the military needs to be overhauled, Retirement ages were set well over a hundred years ago when life spans were under 60 years. Noncombat personnel could retire with pensions after, say, 25 years instead of 20. The risk to their lives and health is marginal in most military occupations; Maryland, DC and Virginia are not combat zones, even if personnel wear combat uniforms and boots to work.
– The U.S. has nearly 1,000 overseas bases and installations in 140 nations; many in countries politically stable that don’t require US personnel. Many installations have fewer than 100 troops. Many are simply tripwires filled with potential hostages so as to get America involved in new conflicts and wars. It costs several times more to provide basic level services for personnel overseas.
– The requirements for Secretary of Defense is that they be a civilian (out of the military for 10 years or so). In a reverse position, Retired generals and admirals should be prohibited for 10 years from working for the military-industrial complex so that they will use their skills elsewhere to help the civilian economy.
– Cut intelligence agency size and quantity. Intelligence spending has tripled since the 1990’s, the growth is clearly obsessive. And the result has not been seen improved intelligence and reliability of data but organizational confusion and mountains of reports and paperwork that nobody reads. The intelligence community has 16 different agencies. Their combined budget is over 50 Billion dollars, It includes salaries for about 100,000 people, multibillion-dollar satellite programs, aircraft, weapons, electronic sensors, intelligence analysis, spies, computers, and software. Most of which is used to spy on US citizens rather than on our “Enemies”.
– Weapons are the greatest money sink of all time. One; they are designed to be built in key congressional districts, not to be the most efficient or cost effective, as during the Second World War. The F-22 had 1,000 suppliers in 44 states. The F-35 has 1,300 suppliers in 45 states in key congressional districts and is now estimated to cost up to $300 million per plane. Weapons manufacturing is started before finalized testing so as to build a constituency for programs’ continuation. The Wall Street Journal ran an article pondering what fighter planes would cost if Apple manufactured them like it makes iPhones…….minus Chinese slave labor.
– Cut the US nuclear arsenal by 2/3. The US still maintains 8,000 warheads. We can cut the warhead number by half and save tens of billions and still offer credible deterrent.
– Cancel the F-35 fighter. The F-35 joint strike fighter has failed to meet all planned mission objectives. It is a money pit of technological flimflam meant to keep Lockheed financially afloat in the late 90’s and must be cancelled before more taxpayer dollars are wasted.
Cuts to spending make no sense if you cut taxes simultaneously, that’s like a family going on a “budget” then the family see a 10% decline in household income. If taxes are increased to cover actual costs budget’s stabilize. The idea that cutting taxes will somehow decrease the deficit was shown to be false when it didn’t work for President Reagan in the early 80’s. At least Reagan realized the deficit was dramatically increasing and passed a large tax increase in 1986 to at least minimize the deficit; in fact he raised taxes 11 times. Unfortunately President George H. W. Bush made the foolish promise of “no new taxes” then realized that for the spending demanded of the Federal government there was no option but to raise taxes. President Clinton sensibly kept vetoing tax cuts and at the end of his term the US had a budget surplus. After that Congress installed 20 years of minutiae and loopholes to our tax code allowing emerging giants like Hollywood/silicon valley, tech companies who produced trillions in commerce.
When the economy is doing well the budget deficit and debts should be paid off. So that in a downturn there can be deficit spending to prevent a catastrophic depression.
Want to keep Federal spending down? When the economy is doing well any increase in Federal spending must be paid for with tax increases. Want to go to war in [Insert country] Taxes go up. This will make voters realize what the real cost of spending is. Want a rail system in your city? You pay for it, preferably out of user fees. That is a way to get responsible spending of tax revenue. Otherwise the continued deficit spending will result in even more tax dollars simply going to pay interest.
When the economy is doing well the budget deficit and debts should be paid off. So that in a downturn there can be deficit spending to prevent a catastrophic depression.
Straight out of The General Theory of Employment, Interest and Money, John Maynard Keynes (1936).
What Keynes got wrong, though, was human nature. Politicians of either pary will pander to their electorate when deficit spending becomes acceptable, promising bread and circuses no matter the prevailing economic conditions. The debt never gets paid off. It wasn’t paid off during the Clinton administration nor any subsequent administration, although Reagan paved the way to reduced military spending by vanquishing the USSR, which allowed massively reduced military spending in the mid- late- 1990s.
In 2007, former American four-star General Wesley Clark appeared on a PBS news show to expose a secret plot to destroy seven countries in five years. This was based on the Yinon plan to destroy independent Muslim states to allow the expansion of Israel. It was supported by the American oil industry to secure new oilfields and the powerful military industry that always seeks new conflicts to generate easy profits. Six of these seven countries have now been destroyed and President Biden plans to finish this task.The end of the Cold War in 1990 presented a serious problem for the American empire. The threat of communism could no longer justify massive wartime military budgets and a worldwide system of military bases. It could no longer justify American military intervention to protect corporate interests whenever a nation’s political establishment threatened change. The easy profits from military contracts decreased as peace spread throughout the world. The solution was an extensive propaganda campaign to replace the threat of communism with the threat of terrorism.
LR, you and I are probably 95% in agreement. We’d have to go back to the late-1910s to analyze Britain and France breaking up the Ottoman Empire and creating vassal Middle East/North African states all with the goal of securing oil. The US is a relative newcomer in those Middle East adventures for fun and profit.
And unnecessary. Under Trump, the US 1) became the largest oil producer in the world and 2) became oil independent. China, Europe, and Japan, though, are extremely dependent on oil going through the Strait of Hormuz. IMHO we shouldn’t be providing security services gratis just so China, Europe, and Japan can comfortably continue to be supplied with oil.
Well, a serious problem for American defense contractors and their well-paid political lackeys (on both sides of the aisle), anyway. OpenSecrets:
Cui bono?