Living within a budget is simple: First, determine your income realistically and accurately. Second, make a thorough and honest list of expenses that does not exceed your income. However, problems can arise at both the first and second stages of the process. For example, what if your income is unpredictable or subject to fluctuations beyond your control? What if you have unforeseen expenses? Preparing for such problems is possible. You can start by estimating your income using different scenarios—e.g., best, medium, and worst-case scenario planning. You can prioritize your expenses and limit or rule out unnecessary spending. And there is always saving for a rainy day. In the real world living within a budget is not only simple; it is a necessity.
In a recent post Jack Cafferty asks, “Why won’t Congress and the President get serious about America’s debt crisis?” In his blog he identifies a number of government hiring freezes and programs that are not receiving funding because of the ongoing budget problems facing the federal government. In other words, not only are current funding requirements being ignored by the budget fiasco, but the likely outcome is that both Republican and Democratic lawmakers in the White House and Congress will adopt a federal budget that does not come remotely close to balancing the budget any time soon. Every year the budget runs at a deficit—the government spends more money than it brings in—the overall debt of the national government grows accordingly. What many people do not understand is that the national debt is like the “BIG ONE;” the predictable mega-quake that will shatter the west coast like a plate falling on the floor. It doesn’t just happen all at once. It is being prepared as you read this, by all the little stresses and strains that occur every day off our radar. Every day the government borrows money it does not have to pay for programs it can’t afford it is forced to pay off debt using money that could have been used for something else. It cannot go on forever. “Jack!” The answer is simple. Congress and the President don’t expect to be there when the quake finally comes. Unfortunately, millions of Americans are there now, and their homes and their businesses are crumbling around them as you read this.
What do you think about deficit spending? Is there more people can do to help solve this problem? Who should be held responsible for the economic mess the federal government is in?
Congress, Mr. President: Read the first paragraph to this blog please.