14. Try your hand at balancing the federal budget by using Nathan Newman’s Natio
ID: 1255009 • Letter: 1
Question
14. Try your hand at balancing the federal budget by using Nathan Newman’s National Budget Simulation (created at UC Berkeley) at http://www.nathannewman.org/nbs/. Questions:a. Develop a budget and see what happens. Were you successful in balancing the budget? If not, how much of a deficit or surplus did you end up with? What does this exercise tell you about the process of creating a balanced budget?
b. Reexamine the budget cuts or increases you made. What problems would such changes pose for a politician facing reelection?
Explanation / Answer
Kill the Dept of Education and let states handle it, not because of states rights because of efficiency and because it is one of the forces that drives the price of an "educated" worker up. Each year the cost of higher education increases while graduation and knowledge goes down. The Dept of Ed drives the prices up by adding mandates, inflating tuition costs thru Gov't loans (just like housing) and requiring irrelevant courses for students and teachers. If the price of a home builders permit goes up, and the Gov't mandates that each house be solar powered or or Feng Sheu or compliant or whatever then all housing stocks (even hotels and apartments) go up. Think about it, we have a system where a product (a degree) is often required but increasingly irrelevant to actual performance in the economy. The price of this product increases every year even though every other knowledge based industry gets cheaper. Each year the education vendors can increase rates because they will be paid by Gov't funded student loans. The vendors (university) have no reason to lower prices or increase quality. Killing the Dept of Agriculture would pull the Gov't out of a lot of loans, and price controls as well as lowering the price of another basic commodity (food) that is critical both at home and abroad. If the price of transportation (oil) and production (power) and labor (mechanization, qualification) and basic commodities (food) go down then unemployment will decrease (lower support to the unemployed to match contributions) standards of living will rise and the economy will advance. This is not Ron Paul craziness, just basic business sense. __________________
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