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Show Realistic Assessment Of Capabilities Seen Key To Stabilizing Economy The United States may have to reassess both its on-going programs and its ultimate capabilities if the nation is to stabilize its economy and check the frightening growth of inflation, according to Utah Foundation, the private, nonprofit non-profit research agency. "AMERICANS are prone to boast of their status as the rich-est rich-est nation on earth" the Foundation notes in a research brief released this week. "Economists warn, however, howev-er, that there is a limit to w hat even the wealthiest nation can spend without courting fiscal disaster. Recent events give frightening force to that warning, warn-ing, promoting a growing feeling feel-ing that the popular image of Uncle Sam as Santa Claus w ill have to change." THE Foundation recognizes the political overtones in an election year. In the light of the President's proposal for a balanced ba-lanced budget and Congressional Congres-sional debate on the subject the report specifically refrains from any analysis of current proposals for dealing with the 1981 budget, from whatever source they may come. However, it is pointed out that "the nation will face a critical cri-tical problem in the area of federal fed-eral spending and federal debt for the foreseeable future, regardless re-gardless of who may be in the White House or what political party may control the Congress." Con-gress." "PROPOSALS for reducing expenditures and limiting taxation at state and local levels have been sweeping the country for the past two years, but many fiscal experts assert that such efforts can have relatively rela-tively little impact on inflation and on the economy so long as federal taxes and spending go unchecked and the national debt continues to soar," the Foundation states. The House Budget Committee, Commit-tee, in December 1979, directed the Congressional Budget Office to make a study of "possible strategies that could lead to a reduction of the federal budget. . .not confined to steps that are feasible only in 1981, but looking at the budget issue in a five-year perspective." THE BUDGET Office report, re-port, entitled "Reducing the Federal Budget: Strategies: and Examples" was recently published. The study notes that large-scale federal budget reduction cannot be achieved by across-the-board application applica-tion of a mathematical formula, formu-la, but must be based on careful care-ful analysis and long-range planning. None of the 56 specific "examples" "ex-amples" presented in the Congressional Con-gressional report are analyzed by Utah Foundation in order to avoid political implications. Five broad, long-range categories cate-gories set forth in the Budget Office study "hold a great deal of interest for all American citizens, quite aside from politics, poli-tics, and appear to merit the closest attention" the Foundation Founda-tion points out. The five areas for suggested action are: MANAGEMENT efficiencies. efficien-cies. The sprawling federal bureaucracy appears to offer a large number of opportunities for improved efficiency. - Better targeting. Many programs miss their real targets and pour money into unproductive channels. The Foundation points out that "Utahns can look to their own record to see w hat can be done by accurate targeting. In the 1950's, Utah won national acclaim by basing its public assistance progrram on genuine need, thereby providing provid-ing welfare grants that were above the national average while at the same time holding per capita costs below the average." av-erage." - SHIFT LNG responsibility from the Federal Government to state and local units. At a time when the national debt is steadily growing while many state and local governments are producing surplus revenues, re-venues, the logic of at least some federal revenue-sharing programs is coming under increasing in-creasing question. - Shifting responsibility to the private sector. American businessmen complain about federal over-regulation of their operations, while at the same time many of them seek federal financial assistance. Many economists believe priv ate enterprise en-terprise is weakened rather than strengthened by too much dependence on federal aid. - REVISING judgments on what the nation can realistically realistical-ly afford to do. Recent events give frightening force to the warning that even the wealthiest weal-thiest nation can ov erspend its resources. Some fiscal experts say they already detect disturbing dis-turbing parallels between our economic policies and those which have led other nations into financial insolvency. |