I’ve been out for a few days. I made a trip up to Charlotte, NC for the weekend. I had an absolutely wonderful time. We went to Oktoberfest on Saturday and caught a band called Field Music at a small venue called Snug Harbor. All and all it was a great getaway week.
Shortly before the show I had some drinks with some friends at a bar called Kickstand. I was introduced to a fine English gentlemen and discussed politics for over an hour. The only reason I bring up my conversation with this self-described Tory is because we ventured on to the topic of Health Care.
After a year of debating this issue I’m still surprised at all the misinformation that’s passed on as fact. For example, there’s this idea that if the United States simply quit spending as much on the military we could pay for anything we want. I tried to point out that U.S. defense spending is only around 20% of the current budget, but my English friend could not be convinced.
Now some would point out (and they would be correct) that the military is actually spending more than what is budgeted. This is mainly due to the war, but the Department of Defense isn’t the only part of the government with this problem. Social Security and health care programs add up to 40% of the budget. Both of these programs are forecast to eat up more and more of the budget in the future. Simply cutting the defense budget in half would not make those entitlements solvent in the long-run.
The truth of the matter is that defense spending has already been drastically reduced. Between 1950 and 1970 U.S. defense spending averaged around 40 to 50 percent of the budget. People love to complain that our military is overstretched. That’s correct, and it’s underfunded for the current work requirement. Attention liberals, Utopia cannot be funded through defense budget cuts. You’ve already raided that money to pay for the Great Society, which didn’t reduce poverty or increase the accesses to affordable health care.
One more postmortem on the Cash for Clunkers program… The American taxpayer paid $24,000 per car. According to Bill Adams, spokesman for the Department of Transportation the program was “wildly successful.” It is scary what government officials deem as “wildly successful.”
The Cash for Clunkers program gave car buyers rebates of up to $4,500 if they traded in less fuel-efficient vehicles for new vehicles that met certain fuel economy requirements. A total of $3 billion was allotted for those rebates.
The average rebate was $4,000. But the overwhelming majority of sales would have taken place anyway at some time in the last half of 2009, according to Edmunds.com. That means the government ended up spending about $24,000 each for those 125,000 additional vehicle sales.
The Cash for Clunkers program is very simple. Well, at least compared to health care. The simple lesson to be learned here is that if the government cannot manage a program like this effectively, how is government run-health care going to work in the long run?
Thanks in part to Cash for Clunkers third quarter GDP growth was 3.5%. Growth was a modest 1.9% without the Cash for Clunkers program. GDP should be lower in the fourth quarter without the government propping it up.
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