Sequestration - a wake-up call!

This sequestration conundrum is a problem of its own creation, mainly due to the fed trying to manage life within the states.

Let's look at those funds which go from the federal government directly to the states, the question that arises is "why?" The purpose of the federal government is not to be a "super-state" to direct/administer what occurs within the state(s) and definitely not to collect from the richer (states) and give to the poorer.

Think about it from an overhead standpoint. The fed acquires the money by taxation or borrowing, then has to internally administer it through the Treasury to whatever department/agency controls particular projects/programs. The federal department/agency has to establish funding criteria, manage it, process applications for the money, assure no fraud (if only!), account for its disbursal and verify it was spent on the required service. That's just at the fed level.

The State/local department/agency receiving the money goes through basically an identical process with the addition step of responding to federal reporting requirements. If the money must first go to a State agency for subsequent disbursal to a local agency, there's a third overhead level involved.

I have a hard time accepting that funding for local school teacher's aides or first-responder gear and other such stuff is a federal matter, let alone must go through three levels of bureaucratic overhead spanning the continent before that teacher's aide is paid or the first-responder gear is purchased. The cost for such "administration" is staggering and explains the exceptional number of federal employees administering what can and should be done only at the state/local level.

There is no reason for citizens of New York or Illinois to have to pay for state/local activities within Montana or Arkansas - or vice versa. Yet, that's exactly what is happening with this Robin Hood type of federal involvement in state/local matters. If there truly is a need for the funded service, then that money needs to come from taxing within the impacted state by the state and disbursing internally. Federal overhead level is expensive, unnecessary and a significant portion of the federal debt.

The cost of government is a negative factor in determining gross national productivity. Government produces nothing and by its very nature is "overhead." The idiocy of taxing the citizenry at the national level and setting up "trickle down" federal programs to provide money which could just as easily been directly acquired by the state/local authorities without the fiscal burden of paying for federal folk to receive/administer/distribute the money is obvious.

So, all of this "the sky is falling" sequestration stuff should make us wonder why most of these "trickle down" programs exist at all. if there is a local need, then locally tax and pay for it, thus reducing the current overhead by at least a third, probably half. The problem is not that there are too many services/entitlements increasing the national debt, it's that the fed should not be involved with these programs to start with, as the fed does not provide any bang-for-the-buck and by its very involvement eats up more money than necessary to provide many services/entitlements.

Every business person knows that the key to running a cost-efficient, productive business is to reduce the overhead to a minimum. The higher the overhead, the higher the price for the service/product. Until we hold the federal government (Congress and the Executive) to the same money-management standards that stockholders demand of company boards of directors, this stupidity will continue.