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Out-of-control government spending is the most pressing issue of our day. The Coalition to Reduce Spending is dedicated to advocating for reducing federal spending and balancing the budget. Continuing to live beyond our means will only jeopardize our country's future prosperity and security.
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In Congress, contractors sometimes write their own laws

Politico reports this morning on an unsettling phenomenon happening behind the scenes in Congress .

In his bill set to pass this week to overhaul how the Pentagon buys weapons, the new chairman of the House Armed Services Committee relied heavily on those with most at stake: the nation’s arms makers.

Defense contractors played a major role in crafting the proposal by Rep. Mac Thornberry designed to reform the Pentagon acquisition system, according to a POLITICO comparison of the legislation and industry proposals.

Some of the provisions in the Texas Republican’s bill could end up boosting company profits — at the expense of taxpayers.

For example, the bill would weaken the power of the Pentagon’s chief weapons tester, an independent watchdog who answers directly to the secretary of defense and often uncovers flaws in big-ticket weapon systems. That was a provision proposed by the Aerospace Industries Association, which represents the nation’s leading defense and aerospace firms…

Some industry players aren’t bashful about the extent to which they shaped the bill.

“There were, literally, 10 provisions of Chairman Thornberry’s Agile Acquisition bill that had some kind of direct or indirect lineage from our recommendations,” said Will Goodman, a former Senate aide who’s now vice president of policy at NDIA. “They were tightly aligned and in some cases were word-for-word adaptations.”

These kind of perverse incentives are why the fight to reign in spending matters so much. Read the entire report here.

The budget that wasn’t?

The Hill reports on a looming struggle for enacting, well, any serious spending reform in the near future.

The recently passed budget framework is far from perfect. But at least it mostly keeps to the Budget Control Act caps and contains a path to balance.

But now, with much of the Democratic Party and many in the Republican party likely rebelling against keeping the BCA limits, and still others rightly rejecting the idea of so heavily relying on the Overseas Contingency budget as a slush fund,  it looks like the normal budget process might not happen in the first place.

We’ll keep an eye as things develop and bring you updates as they happen.

Scott Walker misses the mark on Pentagon spending

Some disappointing news from another potential Presidential frontrunner this morning:

Wisconsin Gov. Scott Walker, a potential Republican presidential contender, on Saturday said he supports ending the cuts to defense spending under sequestration.

“There’s no way we can adequately fund the defense budget under the sequester,” Walker said in an interview with McClatchy Saturday in South Carolina…

While Walker is certainly not alone in holding this flawed view, it’s disappointing to hear it stated so prominently. People on both sides of the political aisle know there’s plenty to cut. While there is a legitimate debate to be had on the proper levels of DoD funding, it is not legitimate to pretend cuts and savings aren’t there.

“Free College” isn’t Free

Originally posted at the Institute to Reduce Spending.

A leading presidential candidate is taking on the previously unprecedented issue of “debt-free” college. MarketWatch reports:

Making college more affordable is part of Clinton’s plan to boost quality of life for ordinary Americans, Robby Mook, “Hillary for America” campaign manager, told CNBC in response to a question about which age demographic will be the toughest for Clinton to lure.

“What voters are looking for in this election is someone who is going to be a champion for everyday people,” Mook said Wednesday. “For young people, that’s debt-free college, that is finding that job after you graduate.”

There’s only one problem: “debt-free college” isn’t as simple or as progressive as it might sound. For one, it’s likely to benefit top income brackets predominantly, becoming a sort of one- percenter welfare, if you will. For another, as Eric Owens points out in Daily Caller, “A debt-free college plan involving private colleges and universities could also subsidize a multitude of schools with endowments larger than the annual gross-domestic products of many underdeveloped nations.”

There is a well-established link between rising student aid and rising college costs — the case can be made that the former serves to subsidize inflated administrative costs at incredibly financially successful institutions. It’s hard even to imagine the wide-scale impact of something like Clinton is proposing. And with an $18 trillion debt, it’s hard to imagine how we’ll pay for it, too.

Vox accidentally highlights the problem with government programs

In a rather lengthy piece largely aimed at criticizing Rep. Paul Ryan and Republican budgets in general, Vox on Tuesday inadvertently highlighted the real problem with government programs.

[The poverty rate] excludes the very anti-poverty programs Ryan is talking about. It excludes in-kind transfers like Medicaid, food stamps, and housing vouchers, as well as tax-based programs like the EITC. Blasting those programs because they don’t show up in the poverty rate is like arguing that Netflix shows have zero viewers by pointing to cable ratings.

Well… sort of. For this analogy to work, one would also have to assume that Netflix were built upon the premise that its success would improve and sustain cable ratings. In fact, we know the opposite to be the case, both for Netflix and for the nation’s anti-poverty programs.

A much better metric, which takes anti-poverty programs fully into account and is based on more recent data, is known as the Supplemental Poverty Measure. The SPM factors in government programs, and is based on current data about spending on food and other necessities… a group of researchers centered at Columbia — Christopher Wimer, Liana Fox, Irv Garfinkel, Neeraj Kaushal, and Jane Waldfogel — went back and calculated SPM numbers for every year since 1967. To distinguish from the government-issued SPM metric, they call this “anchored SPM.”

The researchers found that anchored SPM (the blue line below) has fallen dramatically in recent decades. But if you take out government programs, you get the green line below, which doesn’t fall at all.

poverty_chart

In other words, when you ignore government programs, poverty rates haven’t gone down at all. Non-welfare economic prosperity for the nation’s neediest remains flat. So much for a “hand up.”

It’s worth saying that few people, even the most fiscally conservative, would object to some level of safety net for needy individuals. At least in the situation that exists today, laudable goals of entirely free-market poverty solutions are still out of reach. But if these government programs are to exist, it seems more than reasonable to want them to have some positive impact beyond increasing dependence.

Particularly in an age of billion-dollar deficits, 18-trillion-dollar debt, and continuously skyrocketing spending, relying upon government for all economic progress is a risky gambit indeed.

What happens when the money runs out? When major programs go bankrupt? It’s worth trying to ensure that our nation’s poor don’t have to find out.

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