THE ROCHE RECORD – Let’s Talk About The Consequences of a Smaller Government

ROCHE RECORD  by Frank Roche
October   2010
SMALLER GOV’T HAS CONSEQUENCES NO ONE IS TALKING ABOUT

For all those Republicans and conservatives up for election on November 2nd who are like me and want to see the federal government act within the constraints of the US Constitution, uphold the 10th Amendment affirming states rights, and produce smaller government at the federal and state level, they have some explaining to do.  The sooner they start, the better will be their chances of success in achieving their goals.

During my 2010 primary campaign for US Congress I made it a point to make clear to those who listened the logical outcome of that stated above:  the near term outlook would involve meaningful economic adjustments and many of our fellow citizens and businesses who have directly lived off of government expenditures will be economically harmed.

Correcting the problems our elected officials have created over the past 40 years has a cost. The idea that the private sector would or could take up the slack right away is a fallacy.  It will likely happen, but it will require years, not days.

It wasn’t long ago we had annual federal budgets in the hundreds of billions of dollars.  Now with government spending above $3 trillion per year, to bring government spending back down towards the hundreds of billions of dollar of just ten years ago will mean a withdrawal of over two trillion dollars in spending and the additional economic activity it engenders.  

GDP = consumption + investment + government spending + net exports

GDP will contract in the short run as Republicans reign in government spending and adhere to the constraints of the Constitution.  The first and second derivatives of government spending levels must be less than zero for an extended period.  Translation:  negative economic outlook.

For those equally convinced of the importance of the 10th Amendment, an economic adjustment is involved here as well.  Many activities performed by the federal government which constitutionally should be manged by states cost money.  This is money the overwhelming majority of our states don’t have, and wouldn’t have for many years.  So, many services society wants, yet managed by the wrong governing body – the federal government – would not be readily available for some time.

Fixing America will involve pain and sacrifice.  It’s right and prudent.  However, to advocate for the fix without explaining the consequence is a dereliction.  Tell the truth, Americans can handle it.

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