Budget Shock – Cutting Wasteful Spending Could Save Trillions!

I am almost always surprised to be reminded that the media and politicians apparently don’t understand the economy very well. See, any American family knows that if you waste money on useless things… you’ll soon end up in debt. But tell the media that cutting waste from the budget could save BIG money and it’s like you’ve just told them the secret of life!


 

A new report is recommending hundreds of cuts to the federal budget that would save trillions of dollars in waste, fraud and abuse over the course of just five years.

Prime Cuts 2015” is the latest installment in a series of reports that Citizens Against Government Waste has released annually since 1993. It contains 601 recommendations the group says would save taxpayers $639 billion in the first year and $2.6 trillion over five years. (RELATED: Why is the Federal Government So Wasteful?)

The largest single cut proposed in the report is the elimination of the Rural Utilities Service, which CAGW estimates would save the federal government $9.6 billion per year, or slightly more than $48 billion over five years.

The RUS is a successor to the Rural Electrification Administration, which was established in 1935 to bring electricity to America’s rural communities. It achieved 98.7 percent electrification and 95 percent telephone service coverage by 1981. Instead of “declaring victory and shutting down the REA,” though, the government restructured the agency into the RUS and tasked it with expanding telephone and broadband service to rural communities.

government-wasteAmong the wasteful projects undertaken by the agency, CAGW asserts, are a $667,120 grant to a town in Arkansas with a population of 122 ($5,468 per resident) and $3.3 billion in grants and loans to fund 854 water and waste disposal projects which together “created only 415 new jobs.”

The report also targets federal subsidies for sugar, dairy and peanuts, projecting their elimination would cumulatively save about $12 billion over five years. (RELATED: Coburn Identifies $345 Million in Corporate Subsidies)

CAGW argues the subsidies, which take the form of import quotas, tariffs, price supports and outright payments to producers, serve mainly to artificially inflate prices for consumers. They have few if any discernible benefits to the industries they are designed to protect but considerable harm to industries that use those products.

Sugar subsidies, for instance, artificially inflate the prices of sugar-containing products by about $3.5 billion every year, which correlates with the loss of nearly 127,000 jobs in sugar-using industries between 1997 and 2011.

Even something as simple as replacing the $1 bill with a $1 coin would produce sizeable savings, the group asserts, estimating that the conversion would save about $730 million over five years. Although coins cost up to four times as much to produce as bills, bills have an average lifespan of about 21 months, compared to a lifespan of 30 years or more for the average coin.

“With the national debt at $18.2 trillion, no area of government should be shielded from spending cuts, including the Department of Defense,” CAGW contends in a press release, noting that one of its recommendations involves cutting unrequested funds to upgrade the M1 Abrams tank, which would save $3 billion over five years.

Even though the Pentagon favors delaying the upgrades until 2017, the group claims, “the project continues to receive a flood of earmarks due to its broad network of suppliers in multiple congressional districts.” (RELATED: 2014 Welfare Waste Dwarfs Forced Military Cuts by 25 Percent)

CAGW describes the report as “a valuable resource for paring down a bloated federal budget,” noting that since its founding in 1984, CAGW’s recommendations have saved taxpayers about $1.4 trillion.

The group’s president, Tom Schatz, concludes that, “By following the blueprint provided by CAGW’s Prime Cuts 2015, wasteful government spending can be cut and the nation can start on a path toward fiscal sanity.”

 

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