We Can't Balance the Budget without cutting Overseas Military Expenditures

The U.S. government is facing annual trillion dollar plus budget deficits as far as the eye can see. Economists warn that in 10 short years interest payments on the debt will consume a whopping 80% of all federal tax revenue. This is not sustainable. Long before we reach that point, the U.S. government will have to devalue the dollar and/or default on the debt, making us all poorer in the process.

There are plenty of ways to squeeze money out of domestic programs. We don't need 29 federal welfare programs. We don't need the departments of Education, Agriculture, Labor, or Commerce. Does anyone know what the Commerce Department does anyway??? The poorly managed Post Office loses $5 billion a quarter. It should be privatized. We need to take a hard look at all domestic spending.

However, one fact is becoming increasingly clear -- it is not possible to balance the federal budget without reducing the size of our overseas military expenditures.

Our current global defense posture is a relic of the Cold War. The Cold War ended more than 20 years ago when the Soviet Union collapsed in 1989. Maintaining Cold War era defense programs and commitments detracts us from meeting the actual threats that we face today. It is also heavily contributing to our enormous annual budget deficits.

Unfortunately, reform will be very difficult. Here's why: the GOP's electoral coalition was largely built around defending us from the communists. So, the GOP is going to be very hesitant to make any changes that could jeopardize that coalition.

After the Soviet Union fell in 1989, a few people on the right like Pat Buchanan started making noises about bringing the troops home from Europe and Japan. This scared the heck out of the GOP establishment, especially the neo-conservatives. So, they started beating the drums against so-called "Red" China (which in many ways is actually more capitalistic than the U.S. is today)

The sad fact is that 9/11 saved the neo-conservatives and the Cold War coalition because they could stand up and say: "see, the world is still a dangerous place and you need us to protect you".

Fortunately, people are starting to wake up to the fact that al Queda is not a country that we can invade and subdue, like we did to Germany and Japan during World War II. Instead, al Queda is a roaming band of bad guys who can easily pack up their things and move elsewhere. We invade Afghanistan so they move to Pakistan. We invade Pakistan and then they go to Yemen. If we invaded Yemen, they would high tail it to Somalia. On and on...

The so-called "war on terror" is a prescription for endless war, growing government power at home, and a mounting pile of debt that will quickly bankrupt the country.

Think about this real hard: Does it make sense for us to borrow money from the Europeans to protect the Europeans? Does it make sense for us to borrow money from the Saudis to protect the Saudis?? Does it make sense for us to borrow money from the Chinese to protect Asia from the Chinese??? This is exactly what we are doing. It's insane.

It's time to bring the troops home from Europe and Japan. The European Union collectively has a higher GDP than does the U.S. Japan is the second largest national economy in the world behind the U.S. (China will likely pass Japan this year.) These are rich countries who are more than capable of defending themselves. So why are we borrowing money to subsidize their defense???

If the Saudis want us to protect them and their oil fields, let's have a national debate on whether or not we should. If we do, then the Saudis can pay us with free oil to keep them safe.

It's also time to find a better way to protect ourselves from the terrorists than costly foreign wars without end. A good place to start would be to reform the failed Border Patrol and the TSA to reduce the chances of another attack at home.

The rapidly mounting debt should be a huge wake up call for all Americans. Obama's measly little spending freeze on discretionary domestic programs won't do a thing to solve the problem. The GOP doesn't even have a plan. If and when they come up with one, it likely will not contain any serious assessment of our costly overseas military commitments. That's a big problem for our future.

Auto Industry Bailout: JUST SAY NO

Barack Obama is pushing for a $50 billion bailout for the U.S. auto industry. We are essentially being told that without this bailout the world will come to an end because the U.S. auto industry is just “too big to fail”.

Here is the essential question: Why is the U.S. auto industry in such terrible shape and in need of a bailout? High gas prices? Unfair competition? Bad luck? Nope. They are on the verge of collapse because collectively they have suffered from four decades of the most brain dead management on the planet.

The U.S. auto companies took too long to figure out that producing quality cars actually costs less, not more, and results in higher customer satisfaction and stronger brand loyalty. As a result of not understanding this, they lost their mindshare and market share in the U.S. a long, long time ago. The big thing that has propped these companies up for the last two decades were cheap fleet sales that were subsidized by their financing ventures. For example, a couple of years ago, the most profitable division of GM was GMAC, which was even in the mortgage business.

They were also completely clueless on how to compete in international markets. For example, they used to constantly whine about how Japan was unfairly closed to them. When I went to Japan for the first time in 1998, I noticed three things: A.) The Japanese drive on the left side of the road, like the British, B.) there were a lot of German cars on the road, and C.) there were very few American cars. The problem was that the U.S. auto companies took forever to sell cars that were suitable for the Japanese market (i.e., with the steering wheel on the right side). The complete misunderstanding of the market, along with their chronic quality problems doomed GM, Ford, and Chrysler in Japan.

The UAW “leadership” is equally culpable for the industry's long decline for refusing to enable necessary operational changes. For example, guess who has the most advanced and efficient auto manufacturing facility in the world? Ford. It’s in Brazil. The UAW would never allow a plant with that level of flexibility and supplier integration to operate in the U.S., which is a huge part of the problem.

My view is that there is no reason whatsoever why the taxpayers should be stuck subsidizing decades of gross mismanagement. GM, Ford and Chrysler are NOT "too big to fail". Even if they do fail, companies with smarter leadership will put their resources to better use. We'll all be better off.

So, it's time to “JUST SAY NO” to the auto industry bailout.

Bob Barr Democrats

It looks like Barack Obama has won the Democratic nomination. Congratulations to him. My guess is that he is going to be the next President. Not because he’s so great. Rather because George Bush has ruined the party that Barry Goldwater, Ronald Reagan, Newt Gingrich, Bob Barr, Dick Armey, and others tried to build.

Obama has a big challenge ahead, namely that white, blue collar voters in the industrial Midwest don’t seem to be inclined to vote for him. The big question for Bob Barr is how he turns these “Hillary Democrats” into Barr voters.

One thing that Barr should propose is to bring our troops home to save our manufacturing base. The U.S. spends countless billions of dollars every year stationing troops in Japan and South Korea. These countries respond by doing everything they can to put GM, Ford, and Chrysler out of business. They are able to compete effectively because their total tax burden is significantly smaller than ours, in part because we are subsidizing their military defense. We need to end the huge defense subsidy that American taxpayers are shelling out to over to 130 countries around the world and then use the savings to cut taxes to help make us more competitive.

We know why McCain won't propose this – he is admittedly clueless about the economy and he is too vested in his antiquated Cold War view of the world to make any real change. I do find it very odd that Obama won't talk about this either. Perhaps his elitist disposition makes him too tone deaf to the plight of blue collar Americans to care.

This gives Barr an opportunity to win over a lot of folks who voted for Hillary in the primary, while upholding our American libertarian values at the same time.