"Knowledge will forever govern ignorance"

--James Madison--

"The real division is not between conservatives and revolutionaries, but between authoritarians and libertarians"

--George Orwell--

Letter To Senator Barack Obama

First posted at The Smirking Chimp, June 6, 2008.

Preface: Following is a letter that I am sending to Senator Obama's Senate office address (he lists no contact address that I can find on his website). I will probably write more letters to him in the next few weeks concerning other issues.
I would have written pretty much the same letter to Senator Clinton if she was the Democratic nominee. Had my first choice (John Edwards) secured the nomination, these letters would not be necessary, and I would currently be working his phone banks.
All policy quotes are taken, in context, from the Obama campaign's "Blueprint For Change" publication, which can be found here:
Dear Senator Obama:
I write to you as an American who is greatly concerned with this country's economic health. We are currently experiencing rising price inflation, stagnant wages, as well as currency deflation. Perhaps the biggest culprit in this situation is borrowing by the US Government.
Overspending by the government results in both more national debt and more money released into the banking system, both of which exert deflationary pressure on our currency. The most immediate effect is a dramatic rise in commodities prices. Oil is now testing $140/barrel.
This year alone, the US Treasury will issue in excess of $700 billion in new Treasury Securities to cover spending in excess of tax revenues.
The official deficit for 2008 is about $400 billion (I'm using very round figures, as the GAO and CBO numbers conflict quite a bit). This does not, however, include debt service or the cost of additional appropriations bills, particularly the $200+ billion in additional spending for the wars in Iraq and Afghanistan. The total deficit is, therefore, in excess of $700 billion, which jibes with the amount of new Treasury securities issued this year.
I have read your publication "A Blueprint For Change". While reading the section entitled "Fiscal Discipline", I came across the following:
"Restore Fiscal Discipline in Congress
Obama will reinstate pay-as-you-go (PAYGO) budget rules, so that new spending or tax cuts are paid for by spending cuts or new revenue elsewhere.
Cut Pork Barrel Spending
Obama will cut skyrocketing pork barrel spending projects by forcing more transparency about who is
requesting projects and what the projects would accomplish before Congress votes to approve them.
Cut Down on Tax Haven and Tax Shelter Abuse
Obama will build on his bipartisan work to penalize companies that abuse the tax code and stop the use of
tax havens.
Repeal Bush Tax Cuts for the Wealthy
Obama is committed to repealing the Bush tax cuts for the wealthiest Americans.
OK. It's a start. But it falls short, I'm afraid. Repealing the Bush tax cuts will add $200-$300 billion/yr in tax revenues, but we're borrowing more than that currently. Add in another $50-100 billion for the Tax Shelter reforms (but only if quickly and very aggressively implemented). We are still at least $300 billion short of parity.
Pork barrel spending/earmarks--these total, by varying estimates, $10-$40 billion/yr. We're still coming up short. If you manage to cut back Iraqi operations within the promised 16 months, then we can add another $200 billion or so in savings. Getting close to parity.
But then, you add in further expenses (EITC expansion, increased farm subsidies, health care, college education, etc) elsewhere in your blueprint, which will require further revenues. Where will you get them? PAYGO is a good idea, but, as President, you cannot force Congress to re-adopt it. Perhaps you should push this hard while you are still a Senator.
But even then, your plan allows for no way to follow PAYGO, as there is no more room in your plan for further revenue increases or spending reductions.
May I offer a few suggestions to help correct this?
Military spending. The elephant in the room, it accounts for more than half of the discretionary budget. While I laud your promise to end the war in Iraq, and thus decrease military expenditures, I also found this troubling passage in your blueprint:
The Problem
The excellence of our military is unmatched. But as a result of a misguided war in Iraq, our forces are under pressure as never before. Obama will make the investments we need so that the finest military in the world is best-prepared to meet 21st-century threats.
Rebuild Trust
Obama will rebuild trust with those who serve by ensuring that soldiers and Marines have sufficient training time before they are sent into battle.
Expand the Military
We have learned from Iraq that our military needs more men and women in uniform to reduce the strain
on our active force. Obama will increase the size of ground forces, adding 65,000 soldiers to the Army and
27,000 Marines.
New Capabilities
Obama will give our troops new equipment, armor, training, and skills like language training. He will also strengthen our civilian capacity, so that our civilian agencies have the critical skills and equipment they need to integrate their efforts with our military.
Strengthen Guard and Reserve
Obama will restore the readiness of the National Guard and Reserves. He will permit them adequate time
to train and rest between deployments, and provide the National Guard with the equipment they need for
foreign and domestic emergencies. He will also give the Guard a seat at the table by making the Chief of the National Guard a member of the Joint Chiefs of Staff."
All of this (especially the part about adding new equipment and an additional 92,000 personnel) sounds to me like it will cost quite a bit more than the current $400+ billion per year in on-budget discretionary military spending. You need to reconsider the expansion of the military. It is already far larger than what we legitimately need to defend ourselves, and has been further bloated by 2 wars of occupation.
By ending the occupations, reducing the number of troops located on foreign bases, halting acquisition of new weapons systems, mothballing part of the existing naval and air capabilities, and allowing personnel to be reduced by attrition, I believe that we could reduce military spending to $200-$300 billion/yr. This would still be more than what any other country on earth spends on defense. We should be able to get by on even less. Russia spends less than $200 billion/yr, and I wouldn't want to mess with them, even today.
In addition, new revenues must be found. I realize that raising taxes is unpopular politically, but more must be done than simply repealing the Bush tax cuts.
The current payroll tax could be expanded. The current ceiling on wages subject to Social Security tax should be lifted. In addition, the payroll tax should also be levied against unearned income as well. Working Americans should not have to pay a greater share of this tax than those who live on their investment income.
To pay for a truly universal health care plan (an issue that I would like to address in another letter), the Medicare portion of the payroll tax should be increased, and should be made a progressive, rather than a flat, tax. Those who make more can, and should pay more (and I say this as a "ten percenter" myself). If the Medicare tax were tripled, it would still be less than what any other first world country levies for health care.
Excise taxes on fuel, alcohol, tobacco, firearms, and other products and commodities could be increased. Again, almost every other developed country charges higher tariffs and excise taxes than does the US.
We cannot continue to have the lowest tax rates of any developed nation while still spending more than any other nation on earth. We must truly adopt a policy of fiscal discipline.
These are Changes that I am Hoping for.
Respectfully yours,