Friday, January 22, 2010

Government should be limited to stimulate economy

Former Mayor Frank Guinta said his zero-based budgeting approach to cutting spending and taxes is working in Manchester, and there is no reason it wouldn’t work in Washington once he is elected to Congress.

“[Department heads] didn’t like it. The budget process for them was longer. It required more time, but guess what? Taxpayers appreciated it,” he said. “We were able to find pots of money in different departments that didn’t have any purpose. And we reduced those things. We cut them out of the budget.”

Guinta, who is running for New Hampshire’s First District U.S. House seat, told a crowd of about 100 in Bedford’s Town Hall on Thursday that government budgets and taxes increase every year because elected officials usually start with the prior year’s budget, then add spending to it. The zero-based budgeting system he implemented as mayor forced department heads to build their budgets from scratch every year. It also forced them to justify every major expense.

“I use this quick phrase ‘freeze, cap and cut’,” Guinta said. “Let’s freeze [federal] spending number one. Let’s just freeze it—stop—you have to stop the bleeding going on. Instead, the Senate is considering raising the debt ceiling by $1.9 trillion. So they still don’t get it.”

Next, analyze every department for waste by doing a top-to-bottom budget review. Last, cut items out of the budget by first prioritizing what services are most important and constitutional, he said.

Businesses engage in such practices every day, but they face increasing pressure from the government to hand over more of their hard-earned money. This, in turn, is stifling the economy, he said.