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By Attorney Steve Grow
January 21, 2012
NewsWithViews.com

Let’s Follow the Money Ourselves

The central problem in government, now and always and everywhere, is governing those who constitute our governments—our public officials, employees and institutions. In our society, we the people have supreme, ultimate authority over our federal and state governments and all that they do—though we have wisely made it difficult to amend our constitutions, they can be amended.

When not watched carefully by ordinary people, there is a tendency for such folks to grab more power than they need, hide information from ordinary people, and demoralize ordinary people into thinking that only those in government and their approved “experts” know anything about the matter in hand—so they sort of leave the government types free and unobserved to do what they want. Ordinary people are encouraged to sit back and trust somebody else see to what needs to be done, and even to come to believe they are helpless to make things better.

When we don’t watch for ourselves, however, mischief or unwise actions tend to happen. Officials often pursue pet personal projects and interests, and do things to cement their hold on power, often largely unnoticed. People of control-freak tendencies, of which there are very, very many, in all walks of life, tend to flock to government positions or to influential positions in business, religion, the professions, society and other institutions--when they sense a chance to grab power over other people’s money and other people’s lives without being watched too carefully. Power draws the most wicked sorts of people like flies. It also tends to draw the worst out of all but the very best of us—at least from time to time. The tendency of power to corrupt has been noted by others.

It remains as true now as when the Socrates in Plato’s dialogues said it 2500 years ago, that there is such a profusion of undesirable people holding and avidly seeking political power, that the very best people only seek such power rarely. When they do, it is not for the sake of the power, but only so they and their fellow citizens won’t be governed by someone much worse. They are only too happy to turn power over to someone else worthy to assume it and get back to their private lives as soon as they possibly can. George Washington was such a person. Harry Truman was such a person. Such people really have to hold their noses in dealing with a huge number of those around them in government, as well as in various institutions in the private sector who approach government for favors.

The temptation of political power becomes greater and greater, the more a government tends to intrude into more areas of life, and the more of a nation’s, state’s, county’s or city’s income and treasure passes through government’s hands, and the more that people are choked and hindered from having satisfying lives in the private sector. For the worst sort of pretended public “servant” (many have forgotten that they are only pretending, thus having become insane as well as a menace)—there is one huge temptation that suggests an obvious counter-measure to enable us to keep an eye on them. Since little can be done without money, or control over it, the power to spend invisibly and without accountability is a monumental attaction to the wrong sort.

Don’t be fooled into thinking that only money that a politician steals for himself, his family or friends, is relevant, although any politician or government official who becomes rich during a political career bears watching and close scrutiny. As Harry Truman correctly said, a really honest person can’t easily become rich in politics.

What can ordinary people do? Well, for one thing we can watch the money. In the last couple of generations, and particularly in recent years (not just beginning with Pelosi and Obama), our country, and many of our states and political subdivisions, and many ordinary citizens, have become convinced to some extent that it is OK on a persistent basis to spend more than you take in—and for government to do likewise. John Maynard Keynes developed a whole economic theory that supports this view, for governments especially, in the 1920s and 1930s. Now what could be a more tempting economic theory for spendthrift politicians eager to spend whatever they can, however they can, in order to try to build their power—than to have an economic theory that says that spending beyond incoming revenues is inherently helpful to an economy. Keynes has given protective cover for any politician wishing to vote to spend beyond our present means—and many, many, many politicians from all parts of the political spectrum have succumbed to that temptation, cloaking their recklessness it in Keynes’s economic theories.

But Keynes has never worked, except as a distraction. The “experts’ claim all this spending is helpful. Well, let’s see for ourselves. If there were any soundness in Keynesian thinking in this regard, then the Great Depression in the United States would have ended much sooner than it did. In the present tense, all the countries in the world that have been overspending relative to their ability to pay, including Greece, Spain, Italy, as well as most especially the good old United States (most especially States within it like California, New York and Illinois and others who have been especially profligate in this regard) should be in their best shape ever. Their economies should be thriving, their governments more than able to fund their commitments with enough left over to reduce their debts and accumulate rainy day funds. Alas, none of that is happening—but the very reverse. And the unprecedented amounts of US deficit spending since Bush II took office, accelerating greatly under Obama, can, at the very least, be said to have given Keynes a fair try. He has failed the test, and it is well to quit pretending that doing more of the same will produce better results. Many richly undeserved Nobel Prizes, have been awarded in economics to true believers in these views.

Our problem is quite serious, so serious that it is scary to even look at clearly. We tend to prefer to look at the problems that several European countries are in and pretend that our situation isn’t already at least as bad—maybe even much worse in some ways. Maybe typical Europeans tend to focus on our problems rather than look at their own.

The portion of federal debt we pay most attention is now somewhat over $15 trillion dollars (and rising rapidly). This amounts to about $48,000 for each of the approximately 312 million people (all ages, whether working or not, whether here legally or not) now estimated to be residing in the US. A family of four’s share is 4 times that or about $192,000.

But that $15 Trillion is only a small part of what the government owes or has promised—the present value of the off-budget promises dwarfs this number. Estimates are that well over $100 Trillion in promises have been made or will arise under existing legislation, including entitlement programs, various federal guarantees of all sorts, etc., that is not carried on the budget as owed money, but that the laws would require to be paid eventually if they are not amended. My understanding is that these estimates are based on present value—what it would cost here and now to pay or provide for these amounts when they come due.

When this additional $100 Trillion is added to the $15 Trillion, it brings each person’s share to over $367,000 dollars, and each family of 4’s share to over $1,468,000. How many years would it take your family to earn that amount of money, plus living expenses? Did you realize that each new child born is saddled with such a mountain of debt right from the get go?

And that is only US Government debt or promises. None of this takes into account state, local and other non-federal governmental debt and promises, nor personal and business debt.

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This generation of Americans has a rendezvous with bankruptcy—particularly if we don’t start paying attention and getting our financial house in order.

Two years ago I read that Nebraska has, for a number of years, maintained a publicly viewable database on which virtually all government expenditures, payment by payment, payee by payee, check by check, could be viewed by anyone wishing to do so. Missouri established something similar a few years back. I propose that the federal government establish a similar database covering (with very few exceptions) all government expenditures and payments to anyone, domestic or foreign. Every dime spent for Congressional, Executive or Judicial Branch operations of any sort—with very, very few exceptions (I recognize that there have to be some secrets here that genuinely serve the public interest), should be included.

The purpose and justification by legislation for each payment to each payee must be shown. The person approving the payment should be shown. Each specific expenditure should be shown.

In the case of bulk payments to, for example, a state, city or group, that payment could not be made unless each such bulk payee is required to and does report each and every ultimate payee and the amounts and justification. This database, including all bulk-payee databases integrated therein, must be updated at least monthly, and any bulk payee failing to fully keep their contribution to the database updated monthly, would be immediately cut off from receiving even another penny of Federal funds. Monies going into private or governmental pension funds or to individuals as employee benefits would be fully included. Moneys going to social security recipients, or social security disability recipients, or recipients of other federal programs should be fully included. Monies going hospitals, doctors, health care providers, pharmaceutical companies, should be fully included. Monies going to universities or to research grants would be fully included. Everything, with very few exceptions, would be included. Monies going to or through the Federal Reserve would be fully included.

Expenditures outside the US should be fully subject to this. If bribes or improper payments are being made into corrupt foreign pockets, this database should enable US individuals and individuals throughout the world to know exactly what is going on so that they deal with improper situations as they deem proper.

This database should enable anyone in the world, including all ordinary citizens and journalists, to have as much information about such payments as the most senior managers in government, executive, judicial or congressional branch, now have.

Our politicians, of both major political parties, have been telling us to leave it to them, and trust them. Well, I think we should have look. If they know we will check up on them, their behavior will be more trustworthy. My own belief is that the 312 million plus of us Americans, each looking at stuff we know something about and are interested in, and billions of foreign people, can do a much better job of monitoring how our money is being spent, than all those “trust us” politicians have been doing, at least in recent years. Surely a lot of money that has been squandered in the past will miraculously stop being squandered in the first place when the officials, and their staffs, know it is easy to look and see. Don’t you behave a bit more carefully yourself when you know someone is checking up on you regularly? I do.

I would supplement this database with a parallel database listing the present value and total amounts of all Federal promises and guarantees that have been made and vested, and a full, actuarially sound on a reasonably conservative basis, statement of the present value of all existing guarantees and other off budget promises of the Federal government. This would include all entitlement programs, employee benefit commitments, and all the very many federal guarantees of all sorts that are out there.

So, besides cutting current spending, we have to cut down on our promising. Both spending beyond our means and promising beyond our means must be be curtailed. And I believe a lot of that spending and promising will be judged to be unwise and unnecessary once all of us are able to watch just how every penny is being spent.

Part of establishing these databases would be repealing or overriding all laws now on the books allowing details of expenditures to be hidden from easy viewing by anyone wishing to see. This could be done with one line of legislation. It ain’t complicated. (A dozen pages of legislation should suffice carve out those very few types of items deserving to be reported more by category, or not at all, than individually.)

While we are at it, it would be very useful to reach back a few years. No reason not to start by creating an initial database accounting for every dime (with very few exceptions) of federal expenditures this last 5 years—excepting only where a constitutionally non-overridable right, created by past (in my personal opinion, corrupt) legislation, makes it unconstitutional to reveal the detail.

As one wise Supreme Court justice from the past once said, “Sunlight is the best disinfectant.” This is true in both a preventive and a retributive sense. When the sun is shining on all spending, and anyone who cares to look, can look, I think much good will result. Internet and computer technology make it possible to extend the full light of day into even the finest details of government. Moreover, all this information no doubt already exists on federal accounting systems, from which it can be obtained and put onto the public website.

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A similar reform would be salutary at all levels of government.

The trust-us politicians will become more trustworthy if they know they are being watched. Trust is fine, so long as we also verify, and have easy means of doing so in this computer age. Let’s start doing it.

As we watch carefully for awhile, we will all be able to see better what specific spending reductions are needed, in our respective opinions, and will have the data necessary to play a vigorous role through our political processes of trying to bring about a sensible solution to our very grave problems. Painful decisions will be made more wisely if we all have the information we need.