Like a drug addict to a drug dealer, the states are addicted to and dependent upon money from the federal government.
The root cause of the troubles that plague America is an overreaching, overbearing, arrogant, and waste-ridden federal government. There is one, simple reason that Washington, D.C. is able to wield so much power: coercion! State budgets would collapse without the infusion of federal funds.
This cause will reveal the extent of dependency by states upon federal dollars and explore methods in which states can employ to wean themselves off this highly addictive drug.
Once the states are financially self-sufficient, they will no longer be susceptible to the extortion or blackmail that the federal government relentlessly utilizes against them.
More background on the cause:
This country fought a revolution to rid itself of a tyrannical central power that did not represent the people. The states entered into a contract (the Constitution) with the understanding that all power not specifically delegated to the federal government would reside with them. Since the founding of this country, the power of the federal government has grown and that of the states has diminished.
The federal government wields its power in everything from speed limits, to highway maintenance and repair, to the education of our children, the light bulbs we can purchase, the foods we eat, and the amount of water in our toilets. They dictate labor laws, environmental laws, and healthcare laws to the states. They own millions of acres of land within the states and dictate what can and cannot be done on them.
They run bankrupt entitlement programs such as Social Security, Medicare, and Medicaid. They operate bankrupt government-sponsored entities such as Fannie Mae and Freddie Mac. They funnel billions of tax payer dollars to bankrupt entities and companies such as the USPS, Amtrak, and green energy companies.
The states are at the mercy of a central bank (The Federal Reserve) whose track record of meeting its own mandate is preposterous. Similarly citizens of the states, who served in the federal armed forces, are stuck in a pitifully inadequate Veteran’s Administration health care system.
Multiple generations of state citizens are now left holding the bag of a $18+ trillion national debt (approaching $100 trillion when you include unfunded liabilities for entitlement programs). It is time for the states to stop being beggers of federal crumbs!
- Wean the States from Federal Funding – On average states get 30% of their funds from the federal government. This blog post includes several charts from NASBO’s Fiscal 2012 Report
- NASBO Survey of the States
- NASBO State Expenditure Report
- Open Letter to Our Leaders – A Novel Approach to Running the Government
- Keynesian economic theory has been thoroughly discredited. The results speak for themselves. It is a self-defeating theory that dies by its own standards. Otherwise the Great Depression would not have lasted over a decade and we would currently be living in an economic boom. The only reason it continues to rear its ugly head is due to the power and control it grants the politicians who employ it as they get to pass out money to their cronies. Add to that the economic ignorance and apathy on the part of the electorate and we get perpetual recessions and stagnation.
- Galt.io postings