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State of California (Butte, El Dorado, Lassen, Modoc, Nevada, Placer, Plumas, Sacramento, Sierra Counties) June 8, 2010 Election
Smart Voter


By Michael Babich

Candidate for United States Representative; District 4; Republican Party

This information is provided by the candidate
Too bad this is in every debate for the past several decades. It used to simply be that funds-in do not exceed funds-out. Period. Two key circumstances have changed that prompt budgetary reform:

First, we have almost 10 times the legislative body than the original Congress. Debate amongst only dozens of the elected back then, compared to 535 of today (435 Representatives + 100 Senators) has led to inefficient decision-making.

Second, it was probably inconceivable to the Constitutional Framers that we couldn't stick to a budget. Just a century ago the mindset was cash on hand. Credit was an embarrassment.

Because this paradigm (or mindset) shift has occurred, and the Federal government's size increase, we need to:

1) Cap the budget as a GDP percentage.

In economics, Hauser's Law is an empirical observation that, in the United States, federal tax revenues since World War II have always been about 19-20% of the GDP, regardless of wide fluctuations in the top marginal tax rate. The only way that tax revenues themselves have increased was when GDP has increased. In the history of the US, this has only happened when tax rates were LOWERED, most notably, this under Kennedy, Reagan, and Bush 43. In contrast, tax revenues have gone down and recession ensued when tax rates were raised. This happened under Johnson, Nixon, Carter, and Bush 41.

2) Restrict funding that adheres to Constitutional authority only, and employ spending priorities that create economic multipliers.

Spending should involve minimal federal dollars (i.e., your dollars), and be both justifiable and tracked. An example of continued support, however, would be to invest in productivity and inventiveness, which ultimately lead to jobs. As evidence, discoveries from projects funded by the National Institutes of Health, National Science Foundation, and the like, have contributed immensely to our nation and world.

3) Pass a presidential line-item veto amendment. Line item veto power was requested by Ronald Reagan, and a law was passed by the Republican-led Congress in 1995. However, it was overturned by the Supreme Court. Thus, an amendment is required.

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