The “Penny Plan.” I like it!


If one asks, “What is the single immutable fact about our federal government,” the answer is that it is spending the American citizen into future penury. The current campaign is talking about “emails,” the “size of Donald Trump’s hands,” whether one can “‘wipe’ a server with a ‘cloth,'” and whether a 6-pointed star is meant to indicate a sheriff’s badge or the Star of David.

When will we get around to the fact that the national debt stands at $19.350 trillion? Numbers like “a trillion” are difficult or impossible for the average human to comprehend:

  • Nineteen trillion seconds ago it was 600,000 B.C. (give or take).
  • If a person’s salary is $40,000 per year it would take 475 million years to earn $19.35 Trillion.

Well, it’s useless. Humans simply cannot comprehend these numbers and therein lies the protection for the idiots running our government. “Oh, it’s just another trillion,” but the trillions keep piling up. In ten years it will be another $10 trillion.

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So, can anything be done about it? It is said that every dollar in our… well, let’s call it a budget… has an advocate. No one wants their slice to be singled out as “stupid,” or “wasteful,” or… you choose the correct appellation.

The answer is, yes. A recent plan has been proposed by House Budget Committee member, Mark Sanford, and Senate Budget Committee Chairman, Mike Enzi.  It’s called the “Penny Plan,” and it could work!

[Source: How the Federal Government Can Get Its Spending Under Control, by Justin Bogie and Romina Boccia]

The “Penny Plan” introduces an aggregate spending cap beginning in 2017. Congressmen hate spending caps, so why might this one work? The answer is because it “would cut a single penny from every dollar the federal government spends.” It would be difficult, even for silver-tongued Democrats, to argue that “the poor” and the
“disenfranchised” could not tolerate a “penny less government help per dollar” given to them by other Americans.

[From the Bogie/Boccia article] Under this plan, for fiscal year 2017, the cap would be $3.6 trillion for total noninterest outlays minus 1 percent. For each subsequent year through 2021, outlays would be capped at the previous year’s level (not including net interest payments) minus 1 percent. Starting in the fiscal year 2022, and all subsequent years, total spending would be capped at 18 percent of gross domestic product, in line with the historical revenue average.

Automatic spending cuts are a blunt tool to rein in growing spending, and the main drivers of the debt – Medicare, Medicaid (including Obamacare), and Social Security. Spending caps, enforced with automatic cuts, serve to motivate Congress to prioritize among competing demands for resources. Designed properly, caps can curb excessive spending growth over the long run.

Congress needs to address out-of-control spending. I know it. You know it. Even they know it. But they must be convinced they will lose their jobs unless they do it! Importantly, the “Penny Plan” does not mean that “regular order” cannot be resumed or that Congress cannot judge expenditure A to be more important than expenditure B and, thereby, allocate more revenue to expenditure A. It is, simply, a needed step toward a statutory spending cap.

Time is short.

Roy Filly

 

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About Roy Filly

Please read my first blog in which I describe myself and my goals.
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3 Responses to The “Penny Plan.” I like it!

  1. Anthony L Filly says:

    They certainly don’t mind taking a few extra pennies out of each dollar we make

  2. Flayer says:

    I’ve heard Hannity promote the Penny Plan but never understood what it was. Thank you for the clear description.

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