Advantages And Disadvantages Of Dumas Maugile

POL201
ESSAY 2
Dumas Maugile

The federal budget of the United States is the legislation dictating how much money the federal government is entitled to spend in one fiscal year. It is proposed by the president get but must be reviewed and then passed by congress to pass it and put it into law, then sending back to the President for his signature. There are numerous rules and regulations that congress must follow when making decisions to do with the budget; essentially congress will set spending limits which will be passed down to various subcommittees who will then apportion money to all the different federal programs that are to be covered by the budget.

The federal budget is split into two main categories, known as mandatory and
discretionary spending. Mandatory spending is essentially composed of ‘long term’ programs, or ones that require funding as dictated by law that is not changed by annual appropriations acts. Mandatory (or direct) spending is composed of many of the larger ‘entitlement’ programs in the United States such as Social Security, Medicare and Medicaid. Mandatory spending typically accounts for around 60% of the federal budget and does include smaller expenses such as certain federal salaries. Discretionary spending on the other hand, requires a new bill every year and is composed of hundreds of various programs for which an appropriations committee must set budget limits for on an annual basis. Certain discretionary spending programs however can have a multi-year appropriations and is usually associated with military spending, which accounts for around 57% of all discretionary spending, other costs in the discretionary spending category of the budget includes education, foreign aid, environmental concerns and veterans affairs.

Both mandatory and Discretionary spending are the cause of much debate in relation to its effect on the federal budget crises, with advocates on both sides of the political spectrum having their own ideas as to which type of spending should be cut and where too much money is being spent. The biggest issue critics seem to have with mandatory spending is the fact that, because it is mostly composed of entitlements (money that has to be paid out no matter what) there is technically no short term limit on the amount spent and this makes it hard to create a functional budget due to the fact the programs’ costs are constantly changing. The only way congress can cut mandatory spending is by either enacting laws that will cut the number of people eligible for these entitlements in future years or simply cutting the amount of benefits that people will receive from these programs. Proponents of higher mandatory spending however argue back that it is necessary to keep these programs well-funded as they are designed to aid citizens when in need, which is in their opinion, the role of the government in the first place. Discretionary spending on the other hand, seems to bear the brunt of funding cuts – particularly in the relatively small (13% of the federal budget) area of non-military discretionary spending. This is typically because lawmakers and politicians tend to try and avoid proposing cuts to the military budget and to mandatory spending programs that aid the population in order to maintain popularity amongst their constituents.

The big political debates on mandatory spending tend to lay with Social Security and Medicare; the two of which account for around 37% of the federal budget.
The biggest issue seen with these two programs is that they are costing the country more than it can afford – essentially the taxes used to fund these programs do not meet the amount of money promised to the individuals who have paid these taxes their entire lives to receive benefits upon retirement. As more and more people retire, more money is to be paid out to these individuals, at a rate that the program was not designed to account for. Critics of these programs advocate raising the retirement age and cutting the amount of money paid out at that time. Proponents of these programs whoever see these changes as unfair to the elderly and consider it ‘unnecessary’, they would also argue that higher benefits for the elderly allow them to spend more money in their retirement, contributing to economic growth. The debate is slightly less heated when it comes to Medicare as political advocates from both sides of the political spectrum agree that many aspects of the program are not cost effective. In the discretionary field, debates tend to revolve around funding to assistance and regulatory agencies such as the EPA and OSHA, with conservatives tending to argue that smaller government is better and liberals tending to believe that funding must not be cut in order to protect the country and its assets/people in the future. Another political battleground is on the topic of military spending, by far the biggest slice of the discretionary spending section of the budget. Critics of high military spending argue that it is unnecessary and should be returned to pre-9/11 levels, after all the Department of Defenses’ budget accounts for 40% of global arms spending. They would argue that spending huge amounts on our military (over 600 billion in FY11) is severely damaging the United States’ ability to correctly fund domestic
programs and maintain a balanced budget. MIitary spending advocates however believe that not only will cutting the Department of Defense’s budget damage the countries readiness and ability to combat military threats and terrorism but also will damage the economy by hurting communities who rely on military contractors for jobs. It is without a doubt that American military spending puts a strain on the economy, the only question is to what extent it is necessary.

In response to the budgeting crises, the United States began a budget sequestration, which is essentially automatic across the board budget cuts in the federal government. These cuts called for $84billion in reductions during 2013 with similar amounts to be cut each year until 2021 or until congress passes a new taxation and spending plan. Congress enacted the sequestration in an attempt to force politicians to compromise in order to pass an appropriate budget in the hopes of reducing the huge federal deficit. This has been difficult in recent years as the Republican Party presses to cut funding to programs that the democrats view as vital and the Democratic Party pushing for large tax increases – a big faux pas for the conservatives in congress. The sequester has been a source of huge debate with critics arguing that the cuts are too ‘broad’ (with cuts being evenly split in dollar amounts instead of percentages) and believing that it will actually hurt the recovery of the economy and damage job growth. In the 8 year period, spending will be cut by just over $1 trillion. Discretionary spending is to be cut by $748 billion and mandatory spending by around $339 billion. The huge variation in these cuts can be attributed to the fact that some major mandatory spending programs like Medicare and social security are exempt from the set cuts.

Many different ideas have been discussed for addressing the budget problem in the United States. These obviously revolve around various spending cuts and in some cases tax increases. Some proposals include – raising the retirement age (to reduce the payments Social Security and Medicare must make), raising the payroll tax (in order to allow for more funding to the programs), raising the amount of salary subject to payroll tax and attempting to cut fraud and waste in the medical field. All of these are options that would reduce the tax that Social Security and Medicare take on the budget. As for discretionary spending, the most common solution to unprecedented military spending seems to be focusing on using more diplomatic and economic incentives in American foreign policy so that such high military readiness is not as necessary. This could include taking a less aggressive foreign policy and cutting foreign monetary aid to countries, some would argue that the US should take less of a ‘leader’ role in agencies such as the UN and NATO, allowing other countries to share more of the burden caused by ensuring global stability.
Whatever happens, it is obvious something needs to be done about the budget crises and that both parties need to come to some sort of agreement in regards to where cut should be made and where taxes should be hiked in order to prevent the sequester from continuing and damaging the economy farther.

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