This Week
  • ROC the Future gives update on milestones for local education system.

  • CEO David Boyce has Tompkins Insurance Agencies on a growth path.

  • The Greater Rochester Awards honorees are profiled.

  • Aware of challenges, private schools work to build a sustainable future.

  • Mech Tech HVAC CEO Edward Burns expects the firm to log solid growth in 2014.

  • Kelby Russell wants you to know: Local wines are among the world's finest.

Defense and security top list of budget areas to cut

Click to enlarge
Rochester Business Journal
December 14, 2012

Sixty percent of respondents to this week’s RBJ Daily Report Snap Poll say cuts to defense and security spending, which constitutes 20 percent of the federal budget, should be the priority in an agreement to avert the fiscal cliff.

With the fiscal cliff deadline less than three weeks away, most attention has been focused on the issue of taxes. But spending cuts also loom large in negotiations between the White House and congressional Republicans. Without an agreement, budget sequestration will make across-the-board cuts to defense and non-defense spending (with exemptions for Social Security, Medicaid, military pay and veterans’ benefits, among other programs).

The federal budget contains three major spending areas: defense and security, Social Security and health insurance programs (Medicare, Medicaid and the Children’s Health Insurance Program). Each makes up roughly one-fifth of the budget.

More than half of poll respondents said cuts to Medicare, Medicaid and CHIP and income security “safety net” programs also should be targeted for reductions.

Among Democrats, 80 percent call for cuts to defense and security, compared with 55 percent of Republicans.

Nearly 70 percent of Republicans—versus 28 percent of Democrats—call for cuts to safety net programs.

Roughly 840 readers participated in this week’s poll, conducted Dec. 10 and 11.

The following list identifies areas of federal spending and the percentage of the total budget each represents. In your view, in which of these areas should spending be reduced as part of an overall agreement to avert the fiscal cliff?
Defense and security: 60%
Medicare, Medicaid and CHIP: 54%
Income security “safety net” programs: 50%
Benefits for federal retirees and veterans: 39%
International affairs: non-defense: 38%
Social Security: 34%
Education and job training: 21%
Scientific and medical research: 17%
Transportation infrastructure: 15%

What is your political affiliation?
Democrat: 22%
Republican: 37%
Non-affiliated: 36%
Other: 6%

COMMENTS:

Why must anything be cut? Federal spending as a percentage of GDP is near historic averages, while tax revenue as a percentage of GDP is near historic lows. An increase in tax rates, coupled with a revived economy thanks to continued stimulative spending by the government, will produce enough revenue to pay for current expenditures.
—Matthew D. Wilson

Cut everything a given amount of 15 percent or more if unable to resolve the problem.
—John L. Sackett Jr., Sackett Farms

Military spending remains the sacred—and voracious—cow. Hundreds of billions have been spent on current wars, and that has been the primary debt-driver.
—Tom Gillett, NYSUT

First I would cut Obamacare, then I would cut pay and benefits for members of Congress, including retirement, health care, perks, etc. In fact, I like Texas Gov. Rick Perry’s idea: Make all members of Congress part-time employees.
—Lou Ann Owens

Anyone brave enough to touch child tax credits? I say cap them at two kids. Feel free to have more, but don’t ask the rest of us to subsidize them. At 7 billion, the world really doesn’t need more people.
—Bill LaBine

This poll did not seem to show an option to cut all categories by an equal percentage. That would have been my preference. Also, as usual, it should be pointed out that these reductions in spending are actually reductions in “future” budgeted spending, not a reduction relative to past spending levels. At least that is my understanding.
—Joe Cameron

The categories are too broad and inflexible. What if I want to cut all government non-defense employees by 20 percent to save money? How about abolishing the Department of Education—a total failure of a department? Which category do I check for that?
—George Dounce

I believe we have to start thinking out of the political box. 1) All government executive salaries (over $150,000) reduced to a max of $150,000 until budget is balanced. 2) Eliminate all tax gyrations and go to a straight 25 percent tax rate for everyone. 3) Go to direct electronic voting and eliminate our current ineffective Congress. 4) Government pay back money borrowed from Social Security.
—Ed Schlueter, president, Medgraph Inc.

This is not rocket science. You don’t necessarily have to eliminate an item. You just say, give me the best program you have for 5 percent less. And by the way, your salary increases will be no more than cost of living, and your benefits will be capped for now. If that sounds like the private sector, you are correct. Let’s do that in the public sector.
—Bob Worden, Penn Yan

I would cut 10 percent across the board for starters. That way nobody is left out.
—Brad Howard

Social Security is self-funded and is not part of the budget. I think your numbers are misleading here. The military takes up a much greater part of the budget than what you represent.
—Dave Atias

We need to cut all the programmed increases to zero. We need to then cut some more out of each program. Like an individual in bankruptcy, the feds need to reduce all spending down to life support. Sequestration could be just the answer, since it would mean that every additional expenditure would require some form of oversight and approval, like the allowance I got from my dad when I was a kid. The allowance only got paid when I could explain what I needed the money for, and then only for the amount I needed at that point. If you want to know how it works, just ask my kids, but not my congresswoman.
—Bill Lanigan

Since every state has its own version of HUD, EPA, Department of Education, Department of Environmental Conservation (and on and on), I would eliminate all of those federal versions, and send block grants for 50 percent of the corresponding agency budgets directly to each state. The remaining 50 percent would be savings. I would re-examine every federal program and agency and eliminate any whose purpose or mission is questionable. The duplicity and inefficiency is staggering. The social safety net, while well-intentioned, has become a way of life for far too many people. That needs to change! The federal government has grown way beyond what was originally intended, and it is now bankrupting the country. Yet all they do is ask for more of our money.
—George Thomas, Ogden

In 2008 the federal deficit was roughly $0.4 trillion. Last year it was almost $1.4 trillion. The only answer is to roll back all spending—defense and social programs—to 2008 levels. The problem is the Democrats don’t care about the deficit and the Republicans don’t have the stomach for the media bashing they will receive if they get tough. (Speaker John) Boehner is a hopelessly weak leader for the GOP. Without strong adult leadership, the country is doomed to a Greece-like future of unpayable bills.
—Bob Sarbane

This nation has become infested with moochers, persons living on public assistance. I would like to see Medicaid slashed and not handed over to the states as unfunded mandates.  The moochers got the Obamanite re-elected, and he is ramming socialized medicine down our throats. We don't need to pay for health insurance for children. I want Social Security modified so that it is not used by “young persons” claiming a disability. It's too easy to get a doctor and/or lawyer who will work to ensure that a lazy person can receive disability payments by claiming they have “anger issues,” a sore back or other supposed malady. Social Security was intended to help the elderly; the moochers can quit their malingering and get a job, even if all it is flipping burger or working at places like Wal-Mart. “Safety net” programs are just another program of handouts to moochers. These lazy people believe that we workers owe them something, well tough! All we workers do is work, and the government loots our pay to “help” the moochers have a nice peaceful day watching soaps and game shows. Not a penny should be spent on any non-defense programs. Why we spend money in foreign aid is beyond my ken. Virtually every place we send aid either hates us anyway or will after they receive our help. There is no gratitude shown our nation when we dish out billions to nations with supposed needs; they, too, are moochers. I am sick and tired of working my butt off just so moochers can live the easy life off the tax money the government, at all levels, loots from me. All workers should feel this way.
—Michael F. Kloppel, chairman, Ontario County Conservative Party, Canandaigua

I would make veterans benefits independent from federal retirees, and then increase them. All government employees from federal, state, county, city, town, village (including post office) would have to calculate retirement benefits on base pay. No retirement based on overtime, no "last three years of pay," no comp time, no double-dipping like (Lt. Gov. Robert) Duffy. No state employee earns more than the governor. I would require school administrators to retain their positions for 15 years to be eligible for full retirement—no more "revolving door" of school superintendents taking turns at the helm for three to five years and passing the retirement torch. Then I would basically wipe out welfare as we know it. No "money for nothing." Period. People needing public assistance become wards of the state in return for subsistence. They would be assigned work in the public domain in return for subsistence. I would purge our country of illegal occupants. The right to vote would be exclusive to taxpaying citizens so they could determine how their confiscated money is spent. I would reverse the trend of turning our schools into urban day care centers. Social security would be paid out EXCLUSIVELY to people who paid into it and when the money runs out, that program would be obsolete and terminated. If people were able to keep the money they earned, there would be enough left to retire on. If you pay $6,000 a year in school/property taxes, that is equivalent to a $100,000 mortgage at 3.5 percent over 25 years! Check it out. And that's after they get to your paycheck! I would eliminate the Department of Education, FEMA, TSA and HUD to start. I would merge the vital assets of all security and have the FBI within the U.S., the CIA outside the U.S. All other security agencies would be absorbed by them and be gone. No NSA, Homeland Security, etc. I would increase spending for the Army, Navy, Air Force, Marines and Coast Guard to insure peace through strength. The problem is not due to lack of revenue, it's due to spending. Stop stupid spending.
—Lou Romano

Rather than looking at specific programs, perhaps spending cuts should be 3 percent to 5 percent across all budgets.
—Antonino Barbagallo, Foto-AB Inc.

Waste in health care needs to be addressed. Excessive and unnecessary tests are driving costs up resulting in double-digit increases in health insurance premiums, which employers can't afford. Customers see higher prices while employees get smaller raises. But we also need an increase in the Social Security tax base, currently capped at $110,100. Don't tax the employer beyond this but continue to tax the employee. They would never notice and it would raise much needed revenue. A dual approach.
—Rich Mileo

Social Security is a different funding stream and should be taken off the table. After health care and defense, all else is noise, so the cuts must come from there. But anyone who would suggest the answer to our fiscal deficit is a health care voucher has never been the caretaker of an elderly parent or disabled child. There are two keys to health care reform: end the paradigm of employer-based health insurance, it is an anachronism that is detrimental to innovation and economic growth, and merge Obamacare and Medicare Advantage into a single, government subsidized and regulated private market based insurance program that pays for healthy outcomes, not fee for service.
—Lance Guglin, Performance Technologies

Not enough is done to cut down on unnecessary programs in the defense industry nor wasteful programs. In Social Security, I was seeing the growth in SSI payments as it seems we have loosened the qualifications. A recent article in op-ed section of the New York Times talked about “intellectual disability,” so children are purposely taken out of school so there can be illiterate and parents can collect SSI!
—D. Hoffman

I would cut aid to all programs that have nothing to do with our health and safety, such as sending money overseas to our enemies and other countries that don't like or appreciate Americans.
—Daniel Mossien, architect

The difficulty of the task is readily apparent; these nine line items comprise 89 percent of Federal spending. We should take Social Security out of the equation because it pays for itself. Its 2011 outgo was $731 billion, and its inflow $799 billion. Some say we can't afford it, but its benefits are hardly excessive: according to the Center on Budget and Policy Priorities, Social Security "provided retirement benefits averaging $1,229 per month to 35.6 million retired workers in December 2011. … Social Security also provided benefits to 2.9 million spouses and children of retired workers, 6.3 million surviving children and spouses of deceased workers, and 10.6 million disabled workers and their eligible dependents in December 2011." Excluding Social Security, the "Medicare, Medicaid and CHIP" and "Defense and security" line items are really about 26 percent of the budget each; "safety net" programs are 16 percent. We need new, fresh, and out-of-the-box thinking about those programs: how we get people out of poverty, in addition to the amount we spend and how it is funded.
—David Lamb, Rochester

I believe that the Social Security benefit should be placed on a sliding scale starting as it does now at age 62 with full benefits reached at 72 (like required 401(k) distributions), except in cases of disability. Further, means testing should be applied to limit distributions to those who really need them. I don't have particulars for this idea, nor do I know what it would save, but it would save something. As I get older I begin to realize that while we know everything in our teens and early 20s, we really start to know something useful as we approach retirement. Cutting off that resource by enabling it to leave the workforce is probably not the best idea in a hypercompetitive world.
—Jonathan A. Wilder, president, H & W Technology, LLC

I'm very disappointed in the American people being swayed by either party and not understanding the real problems we face as a nation. It’s very simple: "We can't afford this!" It’s not political—we are spending more than we have. We all need to embrace common sense and not the partisan, feel good, guilt politics that has gotten us into this mess.
—Todd Baker, Pioneer Print and Copy

The entire federal government needs to be restructured. Eliminate the departments that have no constitutional rationale such as Energy, Health, Education and Welfare, Transportation, etc. These departments offer no value, only diving up bureaucratic costs of government.
—Jim Weisbeck, Bloomfield

Federal retirees benefits should be renegotiated, not veterans. Veterans are already inequitably low. We should privatize the better part of whole federal agencies—beginning with the post office and keep going from there. While reducing costs we should be reducing state costs, too. Otherwise, federal costs will only be reallocated to the states. On the state level, let's start with state worker retirement benefits.
—Jay Birnbaum

I want my tax dollars going to pro-life, not pro-death budget items.
—Ken Maher

We should go with zero-based budgeting and none of the baseline budgeting that has driven up our costs so ridiculously over the years. Also, the federal government needs to only fund activities that are constitutionally mandated and leave the rest to the states.
—Kathy Zaroczynski, Zaroczynski and Associates

In truth, deep spending cuts should be made across the board. The federal government needs to be restructured like so many businesses have faced. As citizens, we have the responsibility to voice our opinions to our leaders and demand action. Without preemptive measures to reduce spending, our children's future will most certainly be compromised!
—P.J. Guisto, managing partner, JC Jones & Associates LLC

One billion dollars monthly in Afghanistan that is not in the budget. Duh.
—Ford Greene, retired

Why do you lump veterans’ benefits in with federal retirees’ benefits? After foreign aid, the first thing I would cut would be federal employee benefits-starting with Congress and the executive branch—I would not cut veterans benefits at all. I would bring all federal employees into the Social Security system—eliminating Congress' full pay after serving one term, and replace all "defined benefit" programs with "defined contribution" programs at all levels of government.
—Harry Caruso

There is no program that should not be cut, but cut wisely. Establish a figure: 5 percent, maybe 10 percent, and then provide very specific guidelines for how to implement it. Politicians demagogue us saying we'll lose firefighters, teachers and police so we can't cut anything. So make that not so. None of the service providers go unless their job meets the criteria assigned for implementing all the cuts. For example, target duplications within and across departments and eliminate all but the best one. Trace service delivery to every job—no connection? One must question how essential that job is. Stop the advertising of government programs—sufficient agencies exist to refer where needed. We must no longer allow government to operate as if it is not subject to the rules of economics and business. We're robbing from future generations to avoid the difficult decisions of our own generation. Shame on us if we allow that to continue.
—Mimi Bacilek

Your pie chart is misleading. The current defense budget, now pushing $600 billion, does not include the continuing costs for Iraq and Afghanistan, the Veterans Administration, Homeland Security or the CIA. Actual total National Defense costs are pushing $900 billion. We still have the $10,000 hammers, etc., and a military industrial entity so absurd no one has been able to do a successful audit of costs—including waste, fraud and abuse. The scandal of the General David Petraeus affair is not the human weakness, but generals and admirals using military planes as private jets to attend social functions with the elite, and using our soldiers as butlers and chauffeurs. We literally have hundreds and hundreds more generals and admirals than we had to win WWII. Federal unions have worked many times to cap government funded contractor salaries and have a cap in the current defense authorization bill of $230,700, the vice president's salary. The current cap is $763,029, a figure that a defense contractor can add on a contract under labor costs for a CEO already being paid millions of dollars. With the huge reduction in our manufacturing base, Dept. of Defense is now about the most inefficient "jobs" program we can have when it comes to both private and public investment. This is a fiscal slope, not a cliff and you cannot cut one's way to prosperity. The people did not vote for cuts in social security, health care, or education. England, which is not on the Euro and prints its own money, continues on austerity and had zero growth last year and so far is looking at negative growth, or contraction this year. Will anyone look at what austerity and deficit reduction is doing to Europe?
—Jim Bertolone, Rochester AFL-CIO

I think we should stop being the world's police force. I also believe we could limit the social security cost of living increases as well as raise the Medicare and Medicaid eligibility age to match social security. Obviously this would have to be phased in over a period of time to make sure people are not dropped in a "hole.”
—Al Schnucker, Schnucker Packaging Inc.

The first item that should be cut is the retirement and medical benefits for all current Congress members, especially the Do-Nothing House Republicans. I believe there is plenty of waste that can be trimmed across the board. This should have been worked through during the last two years, instead the Republicans just said NO and blocked any meaningful legislation to help the American people with the hopes of defeating President Obama. If we go over the preverbal “fiscal cliff,” I will blame that ALL on (I’m ashamed to omit) my Republican Party. (P.S.: The party that doesn't care for the Average Joe, just the rich.)
—Stanley Hilt 

The Constitution clearly says that the role of the federal government is to provide for the common defense, manage foreign relations, protect citizens’ constitutional rights, establish federal courts and a few other minor issues. No branch of the federal government is authorized to handle any other issues. So the federal establishment should be strictly limited to these functions; all others should be reassigned to the states, local governments, and individual Americans. The federal government has grown into an intrusive establishment that tinkers with the environment, healthcare, education, oil corporations, hospitals, railroads, subways and highways and has continued this expansion to troubling extremities. It has a huge annual budget deficit exactly because it has grown inexorably, meddling with affairs not assigned to it by the Constitution. James Madison, the author of the Constitution, when asked to vote on a new appropriation, said that he “could not undertake to lay (his) finger on that article in the Constitution that granted a right to Congress of expending, on objects of benevolence, the money of their constituents. And if they once broke the line laid down before them, for the direction of their conduct, it was impossible to say to what lengths they might go, or to what extremities this practice might be carried.” Ronald Reagan said during his first inaugural address: “We are a nation that has a government, not the other way around. Our government has no power except that granted by the people, and this makes us special among the nations of the Earth.” Indeed!
—Kathleen A. Wright, Brighton

Eliminate automatic budget increases across the board!
—Thomas Zimmerman, FAIA Z2 Architecture, PLLC

Notice what is not on the table or at the low end of the cliff spectrum fix! The president and the speaker need to “KISS” (Keep It Simple Stupid) and make up! Deploy the six-step KISS methodology. Let’s stop all the cliff talking, you are over the cliff anyway and all you are doing is dragging it out. Let’s not talk tax cuts of programs such as social security, Medicaid and Medicare! But the six KISS strategies! We the people are not only demanding no tax increases from you, but real government spending cuts of all existing named government agencies like CIA, TSA, etc., and all departments like DOT, DOD, etc. KISS Step 1. Freeze all government hiring and government pay across all agencies and departments. KISS Step 2. Cut all baseline budgeting tricks from the automatic 12 percent to 16 percent increases every year to a negative 25 percent real U.S. budget across all U.S. federal government. That means a freeze, no increase of any kind. Which means zero—NO— increase of any federal government agency or department that has or uses the automatic baseline increase budget trick? KISS Step 3. We need to demand a real U.S. government budget freeze over the next 10 years. KISS Step 4. We the people then demand a 10 percent cut to the real U.S. frozen budget across all agencies and departments across their budget board. KISS Step 5. In the event it is still not enough and they did not do their jobs, cut all frozen government salaries, benefits, pensions. We are only asking them to do what we the people have had to do over the past decade. KISS Step 6. We the people demand a balanced real U.S. government budget that you and I will live within. You need to deploy the KISS steps strategies and to do the right thing!
—Gregg Palis

12/14/12 (c) 2012 Rochester Business Journal. To obtain permission to reprint this article, call 585-546-8303 or email service@rbj.net.


What You're Saying 

There are no comments yet. Be the first to add yours!

Post Your Own Comment

 
Username:
Password:

Not registered? Sign up now!
 

To Do   Text Size
Post CommentPost A Comment eMail Size1
View CommentsView All Comments PrintPrint Size2
ReprintsReprints Size3
  • E-mailed
  • Commented
  • Viewed
RBJ   Google