I am giving a talk tomorrow to small business owners titled “The Budget and Critical Financial Decision Making.” If I were to talk about a budget that is like the one President Obama just unveiled I would be laughed out of the room.
The President is proposing a budget with a deficit of about $1.1 Trillion. That is $3.7 Trillion of spending with only $2.6 Trillion of Revenue.
Lets put this into perspective that a normal person can understand. If your business had revenues of $2,000,000 than spending would be $2,850,000. How long do you think you would be in business under these circumstances?
I know the Government talks about cutting spending but I believe the way Congress looks at a spending cut is a lot different then you and I do. This is how I look at it; last year I spent $10,000 on Office Supplies, this year I will reduce my spending by 10% and only spend $9,000. Makes sense, doesn’t it?
Here is how Congress looks at it. We spent $10,000 on Office Supplies last year, and this year we will spend $12,000 or a spending reduction of 4% of the $12.500 we were going to spend. They are the only ones who can take an increase and make it sound like a reduction.
Do you ever think they are really going to get it?