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A Business Perspective on Federal Government Spending: We Can Do Better

We have to return to the idea that the federal government doesn’t automatically get to increase spending every year. Look at it as a businessperson would and should.

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Political Antics, Logic and the Truth About Overspending

With $16 trillion in national debt, we can no longer afford to allow the government to view spending differently than the rest of America views spending. Nor can we put up with Congress’ nonsensical definition of a cut.

Every year, we hear politicians saying something like, “We projected spending would increase by 4 percent but we’re only going to actually spend 3 percent more, so that’s a 1 percent cut.”

This is tantamount to someone spending $1,000 in a year on travel when they spent $900 last year but saying they cut expenses by $200 because they did not spend the $1,200 they budgeted.

Eventually, we at least need Congress to be in the neighborhood of a logical approach on this issue. No household, nonprofit, business, or school could operate this way, yet this is exactly what is happening in Washington.

Spending Discipline and Zero-Based Budgeting

We—Republicans and Democrats – have to do something differently.

Simply, there needs to be more spending discipline. And, using harsh-sounding labels like “austerity” to discuss spending discipline is silly and irresponsible given the dire state of our debt.

In the early 1970s, then-Georgia Governor Jimmy Carter used zero-based budgeting as a way to focus on justifying every dollar spent in the state government, and he cut state administrative costs in half.

We have to return to the idea that the federal government doesn’t automatically get to increase spending every year. We must get closer to a system that assumes the budget starts at zero, and that every dollar spent must be justified.

We can and need to turn this losing record around.

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Photo Credit: Dolce & Gabbana

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