So I'll just start with this if you haven't heard yet.....
The official name of this is the America's College Promise Proposal. Yes, this is the "leader" of our country making a new promise. This week, I posted an article about how because Obamacare was improperly laid out, many people are going to have to either owe more taxes or have a reduced refund. This is because the subsidies that paid for the people to have lower premiums were too much. So that means we gave people too much money. Where did the subsidies come from? Us, normal people who pay taxes. So we have a large healthcare overhaul that's still not fully implemented yet and still getting figured out and now we just introduced a whole new large scale initiative. I asked Denzel Washington what he thinks about it. Here's what he had to say:
Breaking Down Our Current Finances
So the federal budget/deficit/debt conversation get's pretty confusion because the numbers are so large it's hard to comprehend. So I'm going to take the real numbers and rations and bring it down to simple numbers.
Federal spending for 2014 was $3.5 trillion, but it's revenues are $3.02 trillion. That results in a deficit of $480 billion. So we had to borrow $480 billion dollars to pay our bills last year. Our federal debt that we owe is $18 trillion. So in the history of this country, we've borrowed $18 trillion dollars of money and that number steadily climbs. To pay off our debt, every citizen in this country would individually have to pay $56,492 each. That's you, your spouse, your kids, your parents, grand-parents, and every other living person in this country.
Taking the same ratios, let's take the median household income of the average American family which is around $50,000. Imagine that this family's budget is $57,497. So they have to borrow $7,497 in the year just to make their budget work. Also, they have family debt of $257,142. One thing to keep in mind is that their family debt steadily increases everyday because they keep borrowing money and interest accrues on that as well.
So looking at these numbers, the President is asking for another $595 dollars to spend on top of the $7,497 of extra spending that's causing him to have to borrow money. So the broke are getting broker. But it's all for a good cause, right?
It's Okay If It's For the Right Reasons
If you've ever watched the show. "The Office", you may remember an episode called, "Scott's Tots". One of characters, Michael Scott (played by Steve Carell), promises college tuition to a classroom of third graders. Then, the day comes, 10 years later, when they're all ready to graduate high school and he doesn't have the money to pay for it. But he had good intentions, right? Guess who the Government is?
1.) We must realize that the Government isn't a business. It doesn't earn the money that it receives. It takes our money, directly from our paychecks. It also has the authority to take even more whenever it wishes. We don't get to decide to not pay taxes. So it's all of our collective money that gets used for these programs.
2.) As I said above, we're broke. We have a spending problem. However, many have come to look to the Government to be an advocate for the people, They think that as long as it's done for a nice reason, it's okay for the Government to do certain things. This is totally hypocritical. The last blog I posted was about tithing and how we can all be better at it. I mentioned that if you asked someone why they don't give a full tithe (10% of their income), they'd probably say, "I can't afford it". Guess what, this country can't afford more any more of these "good intention" programs. For some reason, it's okay for the Government to borrow money to pay for programs that "help people" but none of us would dare do that. So we can't afford to be "generous" but they can?
3.) Talking about other countries having free tuition doesn't build the case. Many of those countries also have much higher income taxes which gives their government the extra money to pay for college for their citizens. So it's not "free tuition" in Slovenia, Finland, Brazil, etc... No thanks, I don't want to pay more in taxes than I already have to.
4.) The numbers from the White House state that reasonable community college is $3800 per year for a two year degree. That equates to $317 per month. Even if you split that over four years to have more time to save, that's $158.50 per month. It's not impossible to pay for community college. There's hard decisions to be made. Maybe you have to pick up a part time job or maybe you have to take an extra shift at work. You may have to go to your spouse and/or kids and say, "Hey, I need to make some extra money to pay for school so I'm going to have a few less hours to spend with you over the next year or two." It's a sacrifice, I know. But it's not impossible and it's not permanent.
5.) If the President said, "we're going to do this through cutting some funding from existing programs" then that would soften the blow. If he even mentioned entitlement reform, I would jump for joy. However, I haven't seen that type of proactive approach from the White House. Either this will get paid for by just adding more spending to the budget or eliminating more "evil rich people tax loopholes" which he's done before. I hope he proves me wrong.
I'm Not Mean
Some may think I'm negative, but I think it's more like using critical thinking skills. It's tough to have these opinions because people will label you as an "Obama hater", but I would have the same criticism of any person regardless of political party. As I stated above, few of us would go and borrow $3,800 per year and go and hand it to someone to pay for their school. If you did, you'd definitely be looking for higher than a 2.5 GPA. However we're okay if the Government does it. Part of the problem is that many tend to forget where the Government's money comes from. I'm a huge fan of fiscal responsibility and buying things that you can afford. Yes, everyone has a right to education. However, I don't feel that I need to borrow money to pay for it. Is that so wrong?
What does generosity mean to you and at what point does it become unaffordable?
Breaking Down Our Current Finances
So the federal budget/deficit/debt conversation get's pretty confusion because the numbers are so large it's hard to comprehend. So I'm going to take the real numbers and rations and bring it down to simple numbers.
Federal spending for 2014 was $3.5 trillion, but it's revenues are $3.02 trillion. That results in a deficit of $480 billion. So we had to borrow $480 billion dollars to pay our bills last year. Our federal debt that we owe is $18 trillion. So in the history of this country, we've borrowed $18 trillion dollars of money and that number steadily climbs. To pay off our debt, every citizen in this country would individually have to pay $56,492 each. That's you, your spouse, your kids, your parents, grand-parents, and every other living person in this country.
Taking the same ratios, let's take the median household income of the average American family which is around $50,000. Imagine that this family's budget is $57,497. So they have to borrow $7,497 in the year just to make their budget work. Also, they have family debt of $257,142. One thing to keep in mind is that their family debt steadily increases everyday because they keep borrowing money and interest accrues on that as well.
So looking at these numbers, the President is asking for another $595 dollars to spend on top of the $7,497 of extra spending that's causing him to have to borrow money. So the broke are getting broker. But it's all for a good cause, right?
It's Okay If It's For the Right Reasons
If you've ever watched the show. "The Office", you may remember an episode called, "Scott's Tots". One of characters, Michael Scott (played by Steve Carell), promises college tuition to a classroom of third graders. Then, the day comes, 10 years later, when they're all ready to graduate high school and he doesn't have the money to pay for it. But he had good intentions, right? Guess who the Government is?
What's the Problem?
1.) We must realize that the Government isn't a business. It doesn't earn the money that it receives. It takes our money, directly from our paychecks. It also has the authority to take even more whenever it wishes. We don't get to decide to not pay taxes. So it's all of our collective money that gets used for these programs.
2.) As I said above, we're broke. We have a spending problem. However, many have come to look to the Government to be an advocate for the people, They think that as long as it's done for a nice reason, it's okay for the Government to do certain things. This is totally hypocritical. The last blog I posted was about tithing and how we can all be better at it. I mentioned that if you asked someone why they don't give a full tithe (10% of their income), they'd probably say, "I can't afford it". Guess what, this country can't afford more any more of these "good intention" programs. For some reason, it's okay for the Government to borrow money to pay for programs that "help people" but none of us would dare do that. So we can't afford to be "generous" but they can?
3.) Talking about other countries having free tuition doesn't build the case. Many of those countries also have much higher income taxes which gives their government the extra money to pay for college for their citizens. So it's not "free tuition" in Slovenia, Finland, Brazil, etc... No thanks, I don't want to pay more in taxes than I already have to.
4.) The numbers from the White House state that reasonable community college is $3800 per year for a two year degree. That equates to $317 per month. Even if you split that over four years to have more time to save, that's $158.50 per month. It's not impossible to pay for community college. There's hard decisions to be made. Maybe you have to pick up a part time job or maybe you have to take an extra shift at work. You may have to go to your spouse and/or kids and say, "Hey, I need to make some extra money to pay for school so I'm going to have a few less hours to spend with you over the next year or two." It's a sacrifice, I know. But it's not impossible and it's not permanent.
5.) If the President said, "we're going to do this through cutting some funding from existing programs" then that would soften the blow. If he even mentioned entitlement reform, I would jump for joy. However, I haven't seen that type of proactive approach from the White House. Either this will get paid for by just adding more spending to the budget or eliminating more "evil rich people tax loopholes" which he's done before. I hope he proves me wrong.
I'm Not Mean
Some may think I'm negative, but I think it's more like using critical thinking skills. It's tough to have these opinions because people will label you as an "Obama hater", but I would have the same criticism of any person regardless of political party. As I stated above, few of us would go and borrow $3,800 per year and go and hand it to someone to pay for their school. If you did, you'd definitely be looking for higher than a 2.5 GPA. However we're okay if the Government does it. Part of the problem is that many tend to forget where the Government's money comes from. I'm a huge fan of fiscal responsibility and buying things that you can afford. Yes, everyone has a right to education. However, I don't feel that I need to borrow money to pay for it. Is that so wrong?
Question of the Day:
What does generosity mean to you and at what point does it become unaffordable?
Video/Song of the Day:
Until next time.....Happy Budget, Happy Life
I'd rather see that money invested into states that bring back vocational training in high school. I have met a few people who were required (by their parents) to get a vocational degree in order to pay for college. Some went to college, some became entrepreneurs, none have student debt. Rather than handing people education for its own sake, why not educate them to be able to get the education they want independently?
ReplyDeletePromises are looking quite bigger than our budget here.
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