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Book Review: Red Ink: Inside The High Stakes Politics Of The Federal Budget by David Wessel

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Red Ink: Inside The High Stakes Politics Of The Federal Budget  by David Wessel is an important work which analyses  federal spending historically to arrive at the conclusion that the current spending levels are not sustainable over time. A main thesis of the author is that the federal government borrowed 35 cents for every dollar spent in 2011. The rate of spending last year was approximately $400 million dollars an hour.

This is true despite the fact that the federal government ran considerable surpluses for the four years from 1998 to 2001. There are rational reasons why the federal government has had difficulty in maintaining a balanced budget over time, according to Wessel.

The author points out that the United States defense budget is greater than the combined defense budgets of the next highest 17 defense budgets of foreign countries. More specifically, the defense budget during the Iraq
and Afghanistan Wars rose to levels not seen since World War II.

On social programs, the spending for Medicare and Medicaid rose from 2.5 cents to roughly 30 cents of every federal dollar spent today. In addition, the population has been growing steadily at approximately 750,000 people a year beyond the death rate since ’01.

The United States is far richer today than during the Great Depression. For this reason, there are viable options to reduce the federal debt. Wessel shows
statistically that the effective tax rates for the upper-middle class quintile have been reduced by half over the last 30 years. The wealthy, according to the author, are in an even better position due to the treatment of capital gains and dividends, as well as foreign tax havens.

Wessel explains that the Obama Administration utilized fiscal muscle and the federal reserve to save the United States economy from an impending collapse. Red Ink is a call to action by every major constituency in the United State to address both the revenue side and expenses of the federal government before the debt reaches crisis levels.

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About Dr Joseph S Maresca

I've taught approx. 34 sections of collegiate courses including computer applications, college algebra, collegiate statistics, law, accounting, finance and economics. The experience includes service as a Board Director on the CPA Journal and Editor of the CPA Candidates Inc. Newsletter. In college, I worked as a statistics lab assistant. Manhattan College awarded a BS in an allied area of operations research. The program included courses in calculus, ordinary differential equations, probability, statistical inference, linear algebra , the more advanced operations research, price analysis and econometrics. Membership in the Delta Mu Delta National Honor Society was granted together with the degree. My experience includes both private account and industry. In addition, I've worked extensively in the Examinations Division of the AICPA from time to time. Recently, I passed the Engineering in Training Exam which consisted of 9 hours of examination in chemistry, physics, calculus, differential equations, linear algebra, probability/ statistics, fluids, electronics, materials science/structure of matter, mechanics, statics, thermodynamics, computer science, dynamics and a host of minor subject areas like engineering economics. A very small percentage of engineers actually take and pass the EIT exam. The number has hovered at circa 5%. Several decades ago, I passed the CPA examination and obtained another license in Computer Information Systems Auditing. A CISA must have knowledge in the areas of data center review, systems applications, the operating system of the computer, disaster recovery, contingency planning, developmental systems, the standards which govern facility reviews and a host of other areas. An MBA in Accounting with an Advanced Professional Certificate in Computer Applications/ Information Systems , an Advanced Professional Certificate in Finance and an Advanced Professional Certificate in Organizational Design were earned at New York University-Graduate School of Business (Stern ). In December of 2005, an earned PhD in Accounting was granted by the Ross College. The program entrance requires a previous Masters Degree for admittance together with a host of other criteria. The REGISTRAR of Ross College contact is: Tel . US 202-318-4454 FAX [records for Dr. Joseph S. Maresca Box 646 Bronxville NY 10708-3602] The clinical experience included the teaching of approximately 34 sections of college accounting, economics, statistics, college algebra, law, thesis project coursework and the professional grading of approx. 50,000 CPA examination essays with the American Institute of Certified Public Accountants. Additionally, membership is held in the Sigma Beta Delta International Honor Society chartered in 1994. Significant writings include over 10 copyrights in the name of the author (Joseph S. Maresca) and a patent in the earthquake sciences.