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Government Spending

Economy
January 18, 2017
Government’s War on Bitcoin Bank Illustrates Need for Currency Innovation
The federal government’s war against a popular digital asset exchange company offers a lesson in why consumers and business owners should have more freedom to pay as they wish.
Environment
January 17, 2017
Yes, New York Times Commenter Maggie Mae, ‘The Heartland’ Matters
The New York Times produces a weekly “Top 10” list of its favorite comments appearing on its website. One of those comments from last week was by a reader calling herself “Maggie Mae” who wrote, “the entire concept of ‘the Heartland’ needs to be scrapped.
Education
January 13, 2017
PRESS RELEASE: Heartland Institute, National Tax Limitation Committee Urge Trump, Lawmakers to Expand Education Choice
Latest Paper – Documenting How Education Choice Boosts Student Achievement and Economic Growth – is Part Seven of a Multi-part ‘Roadmap for the 21st Century’ Series.
More News
Health Care
January 12, 2017
Policy Diagnosis: Today’s Health Insurance Crisis Stems from Federal Interference in 1943
Hillsdale College Professor Dr. Gary Wolfram traces Obamacare's seeds to the 1940s, 50s, and 60s with alumnus and Michael T. Hamilton.
Health Care
January 11, 2017
Montana Lawmakers Prepare Direct Primary Care Bill
The bill would exempt direct primary care providers from insurance regulations.
Health Care
January 10, 2017
Study: Two-Thirds of Medicaid Expansion Enrollees Were Already Eligible
The finding implies the federal government has been paying far more than its share under the Affordable Care Act.
 

The Issue

Many states face looming fiscal challenges as tax revenues are insufficient to keep pace with growing government spending. Reforming pensions, welfare programs, and other entitlement program is the most promising solution to these fiscal challenges. Those reforms can help states become more competitive, strengthen state economies, and improve the employment outlook for all of a state’s residents.

Some government pension programs have become too generous. State and local government workers routinely are able to retire in their 50s - a decade or more earlier than most people in the private sector can - with pension benefits that exceed the retirement benefits persons in the private sector receive. The burden on taxpayers to fund public-sector retirement programs has been skyrocketing, forcing elected officials to consider raising taxes, more borrowing, cuts in other government services, or a combination of those strategies.

Entitlement programs, too, have become increasingly expensive for taxpayers, and they rarely work well for persons most in need. Most states can improve the effectiveness of their efforts to help those in poverty. Successful welfare reform can save lives and produce positive effects on multiple generations. It can save taxpayers billions of dollars and help address serious social maladies, such as crime, alcoholism, and teenage pregnancy.

Our Stance

In order to stop tax hikes and compel elected officials to control spending, free-market advocates must first prove that lower taxes, privatization of public services, and tax and spending limitations yield stronger economic growth and prosperity. We also must convince elected officials that lowering taxes and reducing government spending is good policy and good politics. Legislators armed with good information can win debates and get their legislation passed, persuade constituents, and mobilize interest groups that benefit from good policy choices.

Featured Subtopics

Man doing a budget with calculator
States are beginning to turn away from baseline budgeting, a method that has proven ineffective in keeping the size of government to a responsible level. They are moving toward zero-based and performance-based budgeting, which has proven effective in cutting deficits.
Cutting a credit card in half
States across the country continue to struggle with balancing their year to year budgets as a result of increasing spending and a lagging economy. Many state legislatures have also accumulated massive amounts of debt which taxpayers will have to pay due to years of overspending combined with state employee pensions and benefits.
Small jar with retirement money
States across the country are continuing to face structural budget deficits as they try to cope with too-generous pension promises made to their employees. Mandatory payments into pension funds divert money away from essential government services and create pressure for tax increases.
A football stadium at night
Sports stadium subsidies are a poor use of taxpayer dollars. They rarely realize the benefits their supporters claim and shift tax revenue away from where it is better utilized. Cities seeking to improve their competitiveness would be better served reducing their taxes or investing in more cost effective improvements like new and improved infrastructure.

Additional Subtopics

  • Deficits
  • Federal
  • Federalism
  • Gambling and Lotteries
  • Local
  • Privatization
  • State
  • Taxes
  • Unfunded Mandates
  • Unions: Public
  • Waste and Pork

Videos

Title: Emerging Issues Forum (EIF) Chicago: Budget & Taxes Panel
Description: States are seeking ways to create a better business climate to attract jobs and businesses to their states. Some states have been passing right-to-work laws, pushing tax reform, and reforming their public pension systems, while others have increased taxes and regulations. This panel discusses which policies are working and which are not. Speaking on this panel are Tax Foundation Vice President of Legal and State Projects Joe Henchman, National Taxpayers Union Executive Vice President Brandon Arnold, and Kansas state Sen. Forrest Knox (R-Wilson County).

Government Spending Experts Team

The Heartland Institute's experts on government spending are available for legislative testimony, speaking engagements, and media interviews.

Staff & Fellows Policy Experts