Like many of you, I am sorting through mounds of paperwork in a race to beat the April 15, 2009 tax deadline. The annual iteration of Form 1040 becomes longer and more complicated with every telling, and begs the question of how the IRS can keep track of all the forms, all the social security numbers, and all the taxpayers.
The answer to the question is called the “tax gap,” a perennial embarrassment estimated at $345 billion in 2006 that the Obama administration added to its agenda in late March 2009. With awe-inspiring deficits on the horizon, our government is going to need every taxpayer dollar they can snatch. They are spending a lot of your money these days, and are working up new ways to spend a whole lot more.
The text of the stimulus plan is widely available on the internet, though the collective bulk of its spending provisions has probably scared away many would-be readers. I took a quick walk through the stimulus plan this morning, using the dollar sign (“$”) as my search term, and found $400 million allocated to NASA for “Science”, and another $400 million to NASA for “Exploration.” I looked further and found $350 million allocated for a broadband inventory map (picture an internet supply roadmap), $5 million for food distribution on Indian Reservations, and $165 million for wildlife refuges and fish hatcheries. I believe strongly in funding NASA, and feeding hungry residents of Indian Reservations certainly sounds like a noble cause, but what the hell is this funding doing in a plan for stimulating the economy?
Congress is already wearing the bloodstains of infighting over the budget, and one has to wonder how much of the pork greasing up the stimulus plan is funding that would never make it through the budget process. With cries for a second stimulus becoming more frequent, we have to wonder just how many federal budgets are going to be passed this year.
An infrastructure could conceivably be developed to make good use of the funding, but we are talking about the capabilities of government, not the private sector. The solution to the problem is not big government socialism disguised as a paternal helping hand, but placing our money in the hands of American businesses where it might do some good. Small businesses received a paltry $730 million in stimulus funding, allocated directly to the administratively overwhelmed SBA. The programs I mention above total well over a billion dollars, and their potential to create jobs is questionable, at best. To be fair, additional assistance in the form of loan guarantees and tax credits is also available to struggling businesses, but too much reliance is placed on the goodwill of the banks as lending intermediaries, their expediency in processing the loans, and their truthful reporting on the number of business loans they are giving out.
Congress used the pain generated by this recession as an excuse to fund orphaned pet projects. While most of us have cut back, Congress continues to spend with abandon as it works itself into a frenzy that will culminate with Stimulus Plan #2.
As we taxpayers give the federal government its annual stipend, we need to consider whether Stimulus Plan #1 was just a clever device to tack on a second federal budget. When you have filed away your taxes and have a little time to relax, download a copy of the stimulus legislation and search the text for “$.” Have a look at what you just paid for.