Archive for the ‘Government Debt’ Category
You heard President Obama’s hysterical press conference yesterday about “catastrophic” spending cuts imposed by the sequester.
Note that federal spending still goes up every year under the sequester, even while household incomes continue to decline.
January posted the sharpest decline in personal incomes for Americans in 20 years, and the worst decline in after-tax incomes since 1959. American households have lost nearly $5,000 in annual income under Obama. But the federal government continues to grow and spend more regardless.
The federal government is now borrowing 46 cents out of every dollar it spends. If Obama were really concerned about the “children,” as he always claims, he’d be concerned about the mountain of debt he’s piling onto their backs.
Every baby born today in America owes $55,000 on the national debt debt. This number doubles every seven years at the current rate of spending.
If Republicans in Congress cave on this modest spending restraint mechanism known as the sequester, there really is no hope for the country.
Here was Obama’s presser on the sequester . . .
The low-information voter has triumphed.
48 percent support cuts for foreign aid. So almost half think foreign aid should be cut. That’s the lone ray of hope in this poll. But with that lone exception, support for spending cuts doesn’t reach 35 percent . . . for anything else.
So all these people who oppose any and all spending cuts must include a lot of people who regularly vote Republican, voted for Romney. Go figure.
Only 20 percent support cuts for farm subsidies (which mostly go to giant agribusiness). Just 21 percent support cuts for Solyndra-style energy subsidies and the U.S. Department of Energy — which should be renamed the Department of Energy Prevention.
The U.S. Department of Energy produces zero energy, just prevents energy from being produced.
Similarly, the U.S. Department of Education should be renamed the Department of Education Prevention.
Does anyone think the quality of education in America has improved since the U.S. Department of
Education was formed under President Jimmy Carter in 1979?
The national debt stands at $16.6 TRILLION. We have trillion-dollar annual deficits as far as the eye can see. The federal government now borrows 40 cents of every dollar it spends.
Every baby born in America today now owes $52,834 on the national debt.
We’ve just added a gigantic new entitlement program (the largest entitlement program of all time for America) with ObamaCare.
So government spending is just going to get even more out-of-control, if that’s even imaginable.
But the American people see no problem with any of this. They want to spend more, not less . . . just like Obama.
Americans overwhelmingly support the Lindsay Lohan approach to fiscal discipline.
How well do you think this story is likely to turn out?
It’s both good economics and good politics. There’s absolutely no reason to strike a deal with Obama on this. Just let the Fiscal Cliff happen.
On January 1, 2013, automatic spending cuts plus Taxmageddon kick in — unless President Obama can strike a deal with House Republicans over spending cuts and taxes.
Obama wants to increase taxes, but doesn’t want to cut spending, with the possible exception of military spending. He certainly doesn’t want to cut or even limit spending on entitlements and welfare programs. He wants those expanded. Obama always wants to spend more. Obama always wants to grow government.
The Fiscal Cliff stops his spending spree.
I’m not the least bit concerned about the automatic spending cuts.
Remember, the Fiscal Cliff is not a Fiscal Cliff for you or me. It’s a Fiscal Cliff for the federal government. It requires the federal government to cut spending across-the-board if Congress and President Obama fail to hit spending cut targets they all agreed to. It requires the federal government to go on a diet.
Isn’t this exactly what we want — mandatory spending cuts?
So this is only a crisis for liberals and Leftists who want no restraints on spending.
Yes, the military will be hit by this. But, frankly, it’s high time we started scaling back our military. Not that I’m against having a huge military if we can afford it. But we can’t.
Right now, 43 percent of the entire world’s military spending is, well, us. We are spending six times more
on our military than #2 China. We are spending 14 times more than Russia. Both Britain and France spend more on their military than Russia.
Russia is really just a Third World country, no longer much to worry about.
There’s no Hitler on the horizon and aircraft carriers are not needed to kill terrorists.
Surely the 11 aircraft carriers we now have are enough.
No other country in the world has more than two aircraft carriers. China and Russia each have one aircraft carrier.
So I’m not losing much sleep over the prospect of scaling back our military some if it also means we have to cut government spending everywhere else by the same proportion.
We need to do this.
The U.S. government now has a $16.3 TRILLION debt and is borrowing 40 cents out of every dollar it spends. We need to cut and we need to cut now. If that means we go from 11 aircraft carriers to six, so be it.
Then we’d only be spending three times more on our military than #2 China.
While we’re at it, let’s also end all foreign aid. We can’t afford that either.
But what about Taxmageddon?
Starting on January 1, 2013, American households will see an estimated average tax increase of $4,223 per year.
Not only will the Bush tax cuts expire, but the patch on the dreaded Alternative Minimum Tax also expires. This will rope another 20,000,000 middle income households into paying the AMT who were never supposed to pay this brutal tax. The FICA payroll tax holiday will also expire on January 1.
The expiration of the Bush tax cuts produces about one-third of Taxmageddon’s tax increases. It’s a myth that the Bush tax cuts only reduced taxes on the wealthy. They also reduced the marriage penalty, increased the Child Tax Credit and the adoption credit, and increased tax breaks for education costs and dependent care costs.
But there’s more, much more.
Taxes on capital gains will go up to 20 percent from 15 percent. Taxes on dividend income will triple for many Americans. Instead of a top rate of 15 percent on dividend income, you’ll be paying whatever your income tax rate is on dividends. So that could be 39 percent under the new rates. And the “death tax” exclusion drops from $5,000,000 to $1,000,000 — with a mind-boggling 55 percent tax rate.
So goodbye family farm, and goodbye family business.
Then, perhaps most crushing of all, most of the 21 tax increases that are embedded in the ObamaCare legislation kick in.
So a tax increase nightmare awaits us January 1.
I say, so what?
If Americans want a gigantic social welfare and entitlement state, they need to start paying for it.
Now, I would certainly prefer there be no Taxmageddon on January 1. But I’m willing to live with it if we also get all those mandatory across-the-board spending cuts.
It would be far better just to have the spending cuts and no tax increases. The tax increases will certainly hurt the economy, probably plunge us into another recession — a double dip.
But I’ll take Taxmageddon if we get all the immediate mandatory across-the-board spending cuts.
I’ve always believed that if Americans had to actually pay for the government they are getting, they would not want this much government.
But politicians have found a way to increase government spending (especially entitlements) without requiring voters to pay the tab. They do this through deficit spending, and letting future generations pay for it — when the current crop of politicians have long since left office.
But that’s immoral. That’s stealing from future generations to pay for today’s government benefits.
It’s time to end this generational theft. It’s criminal that we are saddling babies who haven’t even been born yet with the tab for our benefits. Right now, every baby born in America owes $81,000 on the national debt. It’s time we pay the piper.
This will require brutal fiscal austerity.
But there’s also a big political benefit to going over the Fiscal Cliff and allowing all these automatic spending cuts and tax increases go into effect.
Barack Obama will get the blame.
Taxmageddon will likely push America back into another recession. But that’s, frankly, what America needs. What recessions do is blast the fat out of the economy. We then emerge stronger.
We need to get our fiscal house in order. And that’s painful.
Most Americans won’t like it and will take their anger out on Democrats in the 2014 mid-term elections and the 2016 Presidential Election.
But that’s just a side benefit. It’s also the correct economic prescription.
If you run up your credit card debt so you can live beyond your means, that eventually catches up with you. Then comes the hangover. There comes a point when you have no choice but to dramatically cut back your spending (perhaps even live like a pauper) until you can pay off your credit cards. You must learn to live with less.
That’s what America must do now.
Why not use this opportunity of the Fiscal Cliff to do these two wonderful things:
1) Put America’s fiscal house in order with across-the-board mandatory cuts in government spending; and . . .
2) Let Obama and the Democrats pay the political price for the pain.
There’s really no need to fear the Fiscal Cliff. It’s the tough medicine America needs. We have a $16.3 TRILLION national debt, for Pete’s sake. Soon the debt will be $20 TRILLION. And then we’ll be Greece.
The mandatory spending cuts will make us stronger in the long run.
The House GOP position should be no more increases to the debt ceiling. There’s nothing to negotiate. The debt ceiling should not go up again, period, ever. There’s really no reason to meet with Obama to talk over any of this. Just let it happen.
Government is unpopular already. But how much more unpopular would it be if we actually had to pay for it?
President Obama keeps telling us how great government is. He’s having a tough time selling this message even though we are getting all this government at a 42 percent discount.
That is, we are getting government for 42 percent less than it actually costs because the federal government is borrowing 42 cents of every dollar it spends.
Obama’s big bureaucratic government vision is becoming less and less popular by the day.
Recent Rasmussen polls show that . . .
- 55 percent want ObamaCare repealed compared to 39 percent who oppose repeal;
- 69 percent say spending cuts should be considered for all government programs;
- 66 percent say government should cut spending to help the economy;
- 49 percent think government anti-poverty programs increase poverty compared to 45 percent who think these programs might be helping at least some;
- 45 percent fear the government will try to do too much to help the economy compared to 43 percent who fear the government won’t do enough; and
- 72 percent say small businesses are primarily responsible for their own success compared to 13% who disagree.
So Most Americans think government is much too big and spends way too much. Most Americans also think government is too inefficient and is often counter-productive.
Right now, government might not seem so bad because we really aren’t feeling the true cost of government. Politicians have learned that they can spend money like drunken sailors and pass the bill (42 cents of every dollar they are spending) on to future generations to pay.
So many Americans might not be thrilled with what we’re now getting from our government, but they feel we are at least getting something, so are willing to put up with it. You can live pretty well on your credit card for a while, until the bill comes due and the piper must be paid.
But what if we actually had to start paying what government really costs with a, well, about a 90 percent tax increase?
Of course, a tax increase on that level would collapse the economy overnight, so the revenue would not actually come in. Capital and businesses would flee the country. We would rapidly implode to banana republic status.
But a 90 percent tax increase is about what it would take to pay for the federal government we are now getting.
How popular do you think government would be then?
But Obama continues to blame Republicans for not passing his “Jobs Bill” (really another “Porkulus” Bill) “right now”
THE HILL: Senate Majority Whip Dick Durbin (D-Ill.) said, at the moment, Democrats in Congress don’t have the votes to pass President Obama’s jobs bill, but Durbin added that that situation would change.
“Not at the moment, I don’t think we do, but, uh, we can work on it,” Durbin said, according to Chicago radio station WLS.
President Obama has been calling for Congress to pass his American Jobs Act since legislators returned from their August recess. The jobs plan is made up of a combination of tax increases on the wealthy, new infrastructure spending, an extension of the employee payroll-tax cut and additional funding for unemployment insurance benefits.
POLITICO: Former President Bill Clinton says now is not the time to hike taxes.
“I personally don’t believe we ought to be raising taxes or cutting spending, either one, until we get this economy off the ground,” Clinton told Newsmax in an interview Tuesday. “This has been a dead flat economy.”
Clinton, who is hosting the Clinton Global Initiative’s annual meeting in New York City this week, said that until the country’s debt is reduced, he doesn’t believe cutting or raising taxes or boosting spending are the solution to bringing the country to a full employment economy.
CNS: There were only 1.75 full-time private-sector workers in the United States last year for each person receiving benefits from Social Security, according to data from the Bureau of Labor Statistics and the Social Security board of trustees.
That means that for each husband and wife who worked full-time in the private sector last year there was a Social Security recipient somewhere in the country taking benefits from the federal government.
Threatens “Pass My Jobs Plan Now,” or else. Then says we have to wait until next week to see his plan.
Most of the $450 billion he wants will go to his union cronies.
RON FOURNIER-NATIONAL JOURNAL: Pass this jobs bill, and we can put people to work. Pass this jobs bill, and thousands of teachers in every state will go back to work. Pass this job bill, and we’ll cure cancer, sprout wings, and fly.
OK, that last quote wasn’t really Obama’s. But the first two promises—and many more poll-tested pledges—adorned his address to a joint session of Congress on Thursday night. It was a reelection campaign speech that may go a long way toward convincing dubious voters that Obama “gets it”—that he understands how tough life is for middle-class and unemployed Americans.
First, the president opened with an I-feel-your-pain homage that echoed former President Clinton’s 1992 campaign against George H.W. Bush, a one-term president saddled with the impression that he lacked empathy. Second, Obama offered a creative collection of economic ideas—none of them blockbuster—that were better targeted economically and politically than his 2009 stimulus plan.
The GOP response to Obama’s Job’s Plan should go something like this . . .
ASSOCIATED PRESS: A Standard & Poor’s official says there is a 1 in 3 chance that the U.S. credit rating could be downgraded another notch if conditions erode over the next six to 24 months.
The credit rating agency’s managing director, John Chambers, tells ABC’s “This Week” that if the fiscal position of the U.S. deteriorates further, or if political gridlock tightens even more, a further downgrade is possible.
Chambers also said Sunday that it would take “stabilization and eventual decline” of the federal debt as a share of the economy as well as more consensus in Washington for the U.S. to win back a top rating.
Tim Geitherner is clearly the most incompetent Treasury Secretary in U.S. history. It’s obvious to any 10 year-old kid that he has absolutely no clue what he’s doing.