It is said that you cannot get blood out of a stone; nor, can you pull a rascally rabbit out of a hat; nor, generate new revenue by printing pretty money no one wants. Not here, not now on this tiny Island.Three proactive goals to address the current state of Bermuda’s finances: Find new revenue. Stop excess spending. Generate free cash surplus. These are the optimal benchmarks of a successful corporation. This is the extreme challenge for the new Minister of Finance for Bermuda when he presents the Budget for Bermuda Inc for the fiscal year 2013-2014.Will the new budget accomplish these three goals?Frankly, I do not think it can be done — certainly not this year, and probably not next year!It may take several years for the new ruling party to just achieve a controlled budget equilibrium where revenues realised equals all expenses with the mandatory repayment of massive amounts of interest and principal on our Government’s foreign debt in foreign dollars taking immediate precedence over any hoped-for generated free cash surplus.The country (and its residents) may feel somewhat akin to indentured servants to foreign investors until these debt balances are at conservative levels.There is no real budget when there is no money. Every family (among the thousands) with people unemployed knows that only too well. There is only survival on what is left of the family finances, in order to live to tell the tale another day.A budget details planned goals for income and expenses with the outcome being a successful conclusion, as children love to see at the end of the book. The happy ending is the accumulated savings to benefit the family — with additional happiness.Developing a budget is not ever an easy proposition. Try discussing basic financial needs with your significant other! Can you come to a consensus? Now think about various government factors jockeying for financial consideration for their departments.The reason why so many hate preparing a budget is fear of the unknown and its consequences. Fear paralyses the ability to plan for and face impending changes in one’s financial circumstances.For instance, one financial change that everyone hopes will not happen, or almost arrogantly or complacently (take your pick) thinks will never happen, is losing a primary source of income (your personal job, your revenue generators that fill government coffers).Change is constant. In spite of our attitude of “we’ve always done it this way”, change has always been there even in little old Bermuda. Intuitively, we all know when change is in the air, in our jobs, in our relationships. Just a little budget footwork can produce comfort in understanding what these financial changes will mean.Change is so hard. We deny what we cannot face, hoping the problem will go away.We bank (hope for) on future (not realised) income, but hope is not real; hope does not pay the bills, educate the children, buy necessities, build up capital assets, and maybe, a small vacation. We ignore current outflow expenses; sometimes even accelerate them — figuring what it the point of it all.We put off payments by levering credit cards. We hope (or in some cases) deliberately plan to force someone else to take on our debt.All of these denials (whether on an individual or Government basis) only stave off the inevitable. Then, we resignedly accept the true extent of our financial distress. Then, and only then, can we begin to rebuild a financially sound life.Reality is a real budget made up of both projections and realised financial outcomes for both revenue and expenditures. As of press time, we do not know what will be revealed in this latest Government budget, but consider these final points.A revenue budget is composed of hopeful analytical projections that may be more or less than the estimates.An expenditure budget is a true stated objective — government will only spend within the budgeted allowance. Period. No excess expenses allowed.The budget needs to be strong, realistic, responsible, uncompromising, and achievable.We need a budget that leaves no revenue generator stone unturned, and that will provide solace to Bermuda’s weary and financially-battered residents. We need a budget that will inspire hope and confidence in our future fiscal solvency; a budget that will trigger new investments in our people, companies, infrastructure, and country. We cannot accept anything less.Best wishes to the Minister of Finance Bob Richards.Future articles: Meanwhile, Bahamas is set to legislate a VAT tax that will turn the economy on its head. Cayman has seen an additional influx in expatriate workers and investors.Martha Myron, CPA PFS CFP TEP, is an international financial columnist, a cross border financial planning specialist, and an active member of the American Citizens Abroad Professional Tax Advisory Council, www.americansabroad.org. Contact martha.myron@gmail.com