American Analysis: Lockbox Budgeting in the U.S.A.

Lockbox Budgeting in the U.S.A.

"No man's life, liberty, or property are

safe while the Legislature is in session."

Gideon John Tucker

He was an American

lawyer, newspaper

editor, and politician.

Let's return to 'Lockbox Budgeting' in the U.S.A. Entitlement programs were kept as a separate account from the National General Fund. It was in 1968 that President Lyndon B. Johnson unified all three federal budgets, the administrative budget, the consolidated cash budget, and the national income accounts budget, into one unified budget. He needed to pay for the astronomical costs of the Vietnam War and simultaneously 'The Great Society Program' of the civil rights era.

The assets in the Social Security trust funds consist of Treasury securities, which are promissory notes from the federal government that have never been and will probably never be paid back to the trust funds. We have a $36 trillion national debt and are on course to borrow again this year to cover a $2 trillion annual budget deficit. Congress has been playing a hide-and-seek game with the national treasury. Reduced transparency allows for increased fraud and abuse. We need to move from a world of continuing resolutions into one with an annual balanced budget.

Every common sense administrator operates out of a clear budget that divides all funds into dedicated accounts. We take care of our elderly through entitlements, and we collect taxes for that purpose. Those funds must be kept in self-adjusting lockbox accounts to keep them solvent. These programs are soon to be bankrupt because the funds have been pilfered by our political class.

The national debt and its burdensome interest payments should be refinanced into a fixed-payment national mortgage, spread over a designated number of years, and again placed in a Congress-proved lockbox account. We must achieve financial security by not spending more than we earn while continuing to serve as the world's reserve currency.