The Right Way budget proposal streamlines spending, simplifies the tax code, and reduces redundant expenditures resulting in a 5.4% reduction in the size of government.
The action taken in the budget is the complete elimination of tax credits. The Jobs Now Credit is outdated, left over from the fear of recession over three years ago. The Earned Income Tax Credit is a form of income security that is made redundant by the implementation of the Income Security Benefit. Eliminating these tax credits saves tens of billions of dollars.
Allocating money into funds such as the Oil Spill Cleanup Fund should not be done ad nauseam. There is little evidence the funds are being depleted at a rate significant enough to warrant annual contributions. Repealing this year's contribution will allow legislators to revisit the state of the funds later on or allocate money via statute.
The next action taken in this budget is the elimination of existing income security and social insurance programs. These cuts reached into a few different departments, but these savings were used to fund the new, means-tested Income Security Benefit.
The Income Security Benefit is a means-tested, flexible form of social assistance from the government. The gradual phaseout means the benefit poses little threat to work incentives. This properly aligns supports for the indigent, the disabled, the retired, and the unmotivated with these groups respective needs. No longer will the single mother working fast food for minimum be asked to subsidize the retirement of millionaires.
Block granting, as envisioned by this budget, empowers the regions to interpret rules and encourages them to pursue policy innovations. Regional rights are oftentimes weakened by the financial bloat of the federal government. Now, the federal government has the opportunity to truly empower the regions, both legally and financially, to craft creative solutions to their respective issues. These block grants will also require statutory changes to increase or decrease their value year-over-year.
Passage of this budget provides the federal government with three options:
A) Grow the surplus. The first option is to pass the spending reforms in this budget
and then do nothing to the tax code or other spending line items. This will take the federal
government's surplus from $15.32 billion to $203.46 billion. Increasing the surplus will
accelerate payments on the debt, lowering the already sizable debt interest line item in
future budgets.
B) Strengthen the Military. There has been significant focus on the weakness of
Atlasia's military after nearly a decade of nothing but downward adjustments. The
spending reforms proposed here provide a means of increasing the military budget nearly
50% without taking a dime from the surplus. This significant increase in defense spending
would translate into a dramatic increase in military readiness.
C) Provide tax relief. Taxes are astronomically high in Atlasia. Using the savings from
spending reforms to lower the tax burden faced by any group would be beneficial to the
Atlasian economy. The cuts should be targeted to spur private investment, encourage
economic activity, and boost incomes for workers and businesses alike. This injection of
resources into the economy will yield some tax revenue in the long term, though the
amount of revenue can be called into question.
This budget proposal sets Atlasia on a sustainable fiscal path. It does this while also providing an array of policy options to lawmakers seeking to accomplish a wide range of objectives. Adopting a budget such as this is the first step on a long road toward bringing the Atlasian federal government down to reasonable, responsible levels of spending.
