As Elon Musk goes line by line down the federal budget to slash, as he claims, trillions of dollars in waste, he’s offering up sacrifices akin to what bad personal finance gurus target in an individual’s spending. The daily latte. An iPhone. Avocado toast.Take, for example, USAID, a program that spends about $40 billion a year and one that Musk unceremoniously worked to shut down this week. USAID’s spending makes up 0.6% of the overall $6.9 trillion federal budget. That’s like cutting out $464 a year (or almost 93 lattes) from the average American’s $77,300 annual expenditures.Musk also railed against the $8 million the government spends each year for subscriptions to Politico’s premium paywalled content, a whopping 0.00000115942% of the federal budget, or the equivalent of 9 cents of the average American’s spending.Sure, all spending — either on the federal or individual level — should be revisited every now and again. But these are hardly savings that get you meaningfully toward your bigger financial goals and certainly nothing to crow about.If you really want to make a dent in a budget, focus on the behemoth costs. For individuals, that’s typically big-ticket items like housing and transportation. For the federal government, it’s our old-age programs.It also helps to stop other unnecessary binges on the side.”You can’t significantly cut the deficit just by cutting waste, firing bureaucrats, and defunding immigrants and foreigners. There are no easy shortcuts,” Jessica Riedl, a senior fellow at the conservative Manhattan Institute, posted this week on X. “You have to stop cutting taxes and then address Social Security, Medicare, defense, and a lot of other popular programs.” President Trump and tech billionaire Elon Musk are racing to shut down USAID, a program that spends about $40 billion a year. (AP Foto/Fernando Vergara) · ASSOCIATED PRESSOf course, these are much harder to deal with because, one, these programs provide essential services, and two, their costs keep going up. But to realistically undertake our budget shortfalls, we’d need to resolve these programs’ funding problems.Instead, the Trump administration’s policies make the whole thing worse.Let’s start with Social Security. Not only is the social welfare program the biggest line item on the US budget at $1.5 trillion, but it’s also anticipated to be the largest contributor to the government’s expected spending increase over the next decade, according to the Committee for a Responsible Federal Budget (CRFB). This is simple demographics. We’ve got more older people than younger ones, and they keep retiring.At the same time, Social Security’s reserve funds are expected to run out in 2035, at which point payroll taxes that finance the program will cover just 77% of seniors’ benefits. That’s a huge pay cut for older Americans, especially among those who rely primarily on Social Security for their living expenses.Medicare is in a similar boat. Reserves for the federal healthc
Sab. Feb 8th, 2025
