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Renewing Limited Government: Spending Limits

Guest post by: Michael Hume

Article Overview: We have to renew limited government in the United States, or the entire world will enter a new era of darkness the likes of which no one can foresee. There are at least ten limits we could impose on government (and, in some cases, on what I see as quasi-governmental U.S. institutions) that would have a remarkable turn-around impact on our economy - and on our society. And one of the first, if not THE first, is to limit government spending....

Renewing Limited Government: Spending Limits

The More They Spend, The Smaller Our Economy Gets Putting a Constitutional limit on how much money the government can spend is, perhaps, one of the biggest no-brainers of all time. As Ronald Reagan once said, government is not the solution to our problems, it IS the problem. And the more money it spends, the more it shrinks our free-market economy and threatens to topple the republic. The only way to check it, Reagan knew, is to starve the beast by cutting the spending.

Oddly, Reagan used government spending, specifically huge spending on defense, to win the Cold War without bloodshed. But that's a subject for another time. Liberal critics are fond of pointing out Reagan's record spending, but fail to note that it came with a good reason, and was accompanied by major cuts in other starve-the-beast areas.

We have to renew limited government in the United States, or the entire world will enter a new era of darkness the likes of which no one can foresee. There are at least ten limits we could impose on government (and, in some cases, on what I see as quasi-governmental U.S. institutions) that would have a remarkable turn-around impact on our economy - and on our society. And one of the first, if not THE first, is to limit government spending.

Recent proposals, including the now-famous "Cut, Cap, and Balance" approach, have called for a Constitutional limit (imposed and enforced!) on government spending. Many proposals have mentioned capping government spending at around eighteen percent of Gross Domestic Product (GDP), which is close to the average of the last several decades (not counting the runaway spending since 2009). I think that's still too high, and allows for too much "pork barrel" spending which the government has no business perpetrating. If you restore other limits, such as limits on debt, taxation, and bureacracy, you could limit spending to a much lower portion of GDP - I'm guessing something around ten or twelve percent.

You'd want to build in some exceptions, though, such as an authorization to spend more on defense in a time of declared war. But you'd want language in the law which strictly limits those exceptions, too, so the liberals can't keep the status quo by just keeping us in a constant state of war (or some other "emergency")... that's one of their favorite tricks, and it's part of what's put us in the position we're in today.

In the past, politicians have ingratiated themselves to voters by doling out huge sums of money to their districts for projects that not only defy logical government intervention, but which often seem ridiculous for anyone to undertake. But these bills have been covered (literally masked) by a government which had the sense to allow the market economy to continue to grow, and to supply the government with ever-increasing levels of revenue. Since 2009, though, the liberals have been dashing toward their long-held dream of ending this spend-and-cover system and replacing it with a government-controls-everything collectivist approach. Now that we've had a couple years to see this effort in action, we're watching the market dry up, the government run out of other peoples' money, and the nation totter on the brink of economic collapse.

The beauty of a spending limit is multi-fold. Not only does it prevent politicians from actually collapsing the free-market system that's made America great (and the world more comfortable and safe), it actually gives them an incentive to get out of the way and let the free market grow the economy. If you can only spend, say, twelve percent of GDP, and you're a government spendaholic, you want that GDP to be as high as it can be. And allowing the free market to run, well, free, will be the only way you can get those bucks you want to send back to your district for research on turtles.

Limit the spending. Starve the beast. Until you do, no one will want to start a great business or invest to build wealth (which builds strength). Stop blaming "the rich," and start freeing them to do what they do best: create business, create jobs, create prosperity, create real national strength. Restore true limited government in America now, as the nation's Founders established, or lose hard-won freedom here and throughout the world.

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Article Tags: entrepreneurship, inspirational leadership, personal responsibility, wealth building



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