Monday, December 17, 2012

Tragedy in Newtown, CT

Friday the country was rocked as we learned a deranged man, after murdering his doting mother, charged into the Sandy Hook Elementary School in Newtown, Connecticut, and murdered 26, including 20 schoolchildren most aged 6 and 7.

Every parent felt the impact of this senseless shooting - that innocent young children within their normal daily school routine, could be attacked and gunned down.  We also feel the impact of the loss of those teachers, teacher's assistants, and school officials who were gunned down as they tried to protect their charges from the heavily armed deranged killed.  As we think and pray for those lost, their families, we also have to consider those who survived - who witnessed the carnage and now have to process not only the grief of lost friends / co-workers but also the trauma of what they experienced.

We still do not know what made Adam Lanza snap on that morning, execute his mother as she laid in bed, and arming himself with her weapons, decide to drive to an Elementary School to kill as many innocent people as possible before blowing his own brains out as the police arrived onto the school grounds.  We may never learn the real reason why this individual felt compelled to rage against the innocent who attended Sandy Hook Elementary School.  Evil does happen - and there are those in society who will lash out at society in violence in response to innumerable triggers to their rage and anger.

As we seek answers to the questions around 'Why' - we are also starting to seek answers to the question around what steps can we take to try to prevent these acts of rage against society.  What can we do to stop deranged people from arming themselves and preying on innocent people as they shop in a mall, attend a movie, or go to school?  From Oregon, to California, to Colorado, to Connecticut - in the past few months someone has raged against society by attacking innocent people going about their lives in a mass shooting.

During a prayer vigil held in Newtown, Connecticut for the grieving community, President Barack Obama spoke in general terms around answering the questions around what can be done to prevent another similar tragedy in the future.  He spoke in terms of a solution not being an easy one.  He also reminded us that it will likely take more than just a single step or action to make it harder for another deranged individual or individuals to attack society in a similar manner.  But he also acknowledged the fact that inaction was not an acceptable course. Our society needs to do something to try to make it far harder for someone to arm themselves and fuel their murderous rage.

What should we do?

We need to try to make some sense from this senseless tragedy.  We need to not only grieve, but take sensible steps as a society to try to prevent a similar act.  In our rational minds, we know that we cannot prevent every act of evil or rage against others, but our goal needs to be to make these events as infrequent as possible while maintaining the core values of our society.

Rather than looking at this question in a rational manner, it's unfortunate that there are those who seek to score political points from this tragedy.  This is as unseemly and distasteful as the actions of some of the media - who circle this tragedy like vultures in the name of ratings / personal advancement of their careers.

Those trying to score political points did so from both sides of the political spectrum.

Just hours after we learned of this tragedy, the usual hard left progressives were railing about inadequate gun control laws and calling not only for draconian gun control laws - but a complete re-examination of the 2nd Amendment of the US Constitution and the right for civilians to bear arms.

From the other side of the spectrum, we have comments like those made by former Arkansas Governor, Mike Huckabee, who say that the problem is not soft gun laws, but on a lack of God in our schools and in our lives.

Then there are those who look at society and blame our permissiveness towards violence in our media - television, movies, and video games which removes inhibitions and desensitizes us towards violence.

Each advocate believes that they are right and that theirs is the 'best' answer to the question as to what our society should do.  But there are also challenges and problems with each of these 'solutions'.  None of them are the 'right' reason or answer.  And as President Obama said - multiple steps are needed in order to make it far less likely similar heinous acts will occur.

Banning guns or embarking on draconian gun control laws will not solve the problem of gun violence.  In the wake of the Dunblane murders of school children by a gunman armed with a handgun, the UK banned handgun ownership.  Gun crime soared 35% in the wake of that decision as the criminals remained armed.  Beyond gun crime, violent crimes with knives and edged weapons also increased.  [The same day as the tragedy in Newtown, a deranged man in China, armed with a knife, entered a school and slashed 20 children.]

In Germany, a mass shooting in a school in 2002 killed 16 people.  In response, that nation also passed draconian gun control laws.  Yet, in 2009, a teenage gunman killed 15 during a rampage that began in school near Stuttgart.

At the federal and state level, we have numerous laws addressing gun control already on the books.  Some of these laws 'worked' with regards to Adam Lanza.  Lanza attempted to purchase a rifle just four days prior to his murderous spree - but was prevented from making that purchase as he declined to undergo the required background check or the mandatory waiting period.

Pro-gun control advocates, progressives like Diane Feinstein, Dick Durbin, and Carolyn Maloney, have focused on the weapons that Lanza carried, two semi-automatic pistols, a semi-automatic rifle, and multiple magazines for those weapons filled with hundreds of rounds of ammunition.  They argue that these weapons are unsuitable for civilian use or access because of the rapidity with which they can be fired and reloaded.  They believe that without the availability of these weapons - crimes like this will not take place.

There is a certain hypocrisy with these progressives who have appointed themselves as the 'protectors' of our society and see the availability of guns or certain classes of guns as the primary causation for crimes like Sandy Hook.

These same progressives insist on the 'right' towards the termination of a fetus - generally without restriction if the mother so desires.  They support late-term abortions and partial-birth abortions as a defined 'right' of women defined within the US Constitution - even though it is not specifically mentioned in the text.  Meanwhile they seek to eliminate a specifically named right - the right to bear arms - in the name of the 'greater good' of society.

Reference any restriction around the 'right' of abortion - in particular around the timing or funding - and one is  'declaring war' on women and their rights.  They believe if the mother wants to end a pregnancy, for any reason whatsoever, and even if the fetus is viable and able to survive if born, not only is that the right of the mother, but that the government has an obligation to help fund the termination of that life using funds from the taxpayer - even if that taxpayer has a moral or religious objection to terminating the life of the unborn.

We need to have a consistency in how we define 'rights' and how we value 'life'.

I also find ironic, looking at some of the politically active progressives in Hollywood, the contradiction around violence in society.  They speak out to condemn violence, yet within their careers and actions, they enrich themselves on violence in television, movies, and video games.  Progressives like Quentin Tarantino and Jamie Foxx pontificate against violence and racism as they promote their latest film - which is said to be one of the most violent of the year.  Foxx, appearing on SNL, joked that the best part about this latest movie was 'killing white people'.

Where is our consistency here - and why aren't we holding these people accountable for their hypocrisy?

The left laughs at Bill O'Reilly and others as they speak out against the 'War on Christmas'.  The anti-religion minority in this country attacks the Christian faith and all of its symbols.  They believe their rights are superior to the rights of believers - that they have a constitution right to not be 'offended'.  They claim that referencing God in the Pledge of Allegiance, or on our coinage, displaying the Ten Commandments, a Cross, or a nativity scene on government / public property is 'establishing' a state religion and a violation of their right to not believe in a God or religion.  They forget the rest of the First Amendment which also prohibits the free exercise of one's religious beliefs.

Is there a link between the rise of these actions and the claimed decline in society and societal values?

There's another similar aspect in play when we look at the mentally ill in this country.  Is there a challenge with structuring our society to be reactive when it comes to dealing with the mentally ill - only after they've proven a risk to themselves or someone else - as opposed to attempting to treat or institutionalize those who represent a risk to themselves or someone else?  Connecticut is one of only 6 states that does not have a law in place to ease the institutionalization and mandatory treatment of someone who represents a risk.  A bill was introduced earlier this year to remedy this - but progressive politicians and organizations like the ACLU defeated it by arguing that the individuals rights exceeded those of society as a whole.

Adam Lanza appeared to have some mental challenges which may have manifested themselves in his murderous act.  His doting mother may have believed that these challenges would not or could not manifest themselves in this manner - and may or may not have pushed for more or different treatment for her son.  Her first sign of his rage against society might have been as he executed her.  This is one aspect that we may never know.  But do we need to re-examine how we treat those troubled and mentally ill in our society - where we achieve a better balance between the rights of the individual and the need to protect society?

What I advocate is that the action we need to take in the wake of this tragedy needs to be across a spectrum   of issues.  These issues relate not only to how we approach guns, but also the values of society, and rights of individuals and the rights of society as a whole.  We need to step away from both emotion and political ideology as we take a rational look at these issues.

As noted earlier, we have reams of gun control laws in place at multiple levels.  Are we enforcing them adequately?  Do we, for example, have similar restrictions and educational requirements related to the possession and use of firearms, a deadly weapon,  as we do with automobiles - also a deadly weapon?  We restrict automatic weapons - do we need to take similar steps for semi-automatic weapons?  Is cap and ball (black powder muzzle loaders) the only acceptable weapon - or should we just return to the sensible step of limiting the size of magazines to 5 or 10 rounds of ammunition?

What steps can we undertake to mandate the proper stowage and security of firearms in the owner's home? We can't envision or protect against every possible eventuality - but what steps can we do to work the vast majority of the times to prevent unauthorized people gaining access to the weapons and ammunition?

What more can we do to ensure that the people in our society who need help from mental health professionals get that help even if they don't want the help?

At what point does the need for society to protect itself exceed the rights of the individual to do their own thing their own way?  We see the need to protect the rights of those in the minorities from the tyranny of the majority - but we also need to protect the rights of the majority from the tyrannies of the minorities.  Where is our consistency in our values and rights?  Is all life precious or just some?  Can we do better than condoning violence with one face while enriching oneself celebrating violence with another face?  Is it all about 'me' or do we have an obligation towards a 'greater good' or shared values of society.

Change isn't always for the better.  It's not always 'progressive'.  And as you think about this - ask yourself, if these tragedies are becoming more or less common and reflect on that as you contemplate the changes in our society over time.

Wednesday, December 12, 2012

Quick Hits - December 11-12, 2012

Barack Obama was campaigning in Michigan on Monday - and chimed in on the (then) pending vote before the Michigan House on two 'right to work' bills scheduled for Tuesday.  It's an interesting example not only of projection as well as a blatant canard, but where ideology trumps reality...

What we shouldn’t be doing is trying to take away your rights to bargain for better wages and working conditions. … These so-called right-to-work laws, they don’t have to do with economics; they have everything to do with politics. What they are really talking about is giving you the right to work for less money. … We don’t want a race to the bottom. We want a race to the top. America’s not gonna’ compete based on low-skill, low-wage, no workers’ rights — that’s not our competitive advantage. … It’s also what allows our workers to then by the products that we make, ’cause they’ve got enough money in their pockets.
What a 'pot meet kettle' moment - as so much of the President's approach towards 'fundamentally changing' the country have nothing to do with economics and everything to do with politics and ideology.  Projection is making the accusation towards one's opponents of taking actions that one is already doing - justifying those actions because 'the other side is doing it'.

The canard comes immediately afterwards - 'giving you the right to work for less money'.  Welcome to one of the big lies.  'Right to work' doesn't deliver lower wages - in fact, in right to work states, wages are higher than in the union / progressive dominated states.

Remember the SEIU's Wednesday before Thanksgiving march on LAX (Los Angeles International Airport) intended to disrupt travelers on the busiest travel day of the year in order to highlight the 'plight' and poor treatment of union employees by the companies providing services at the airport?  Over a thousand SEIU thugs were bused into the area because none of the employees 'victimized' by the company participated.  One reason none of the employees participated was that earlier in 2012, a majority voted to withdraw and decertify their union.  Once they tossed the SEIU out - their wages increased.  Not only did their wages increase, as the company passed on the benefits of their lower costs, but the workers also gained from not having to pay union dues - worth at least a day's pay.

Michigan moved towards 'right to work' laws for the same reasons that Wisconsin embraced 'right to work' - to address the major fiscal issues that resulted from public and private sector unions and their grab for power and wealth.  Since Wisconsin took these steps in 2010, the state's fiscal picture has changed.  The state is no longer moving in the wrong direction with a deepening fiscal crisis.  The state budget deficit is gone and school districts across the state are no longer held hostage by union greed.  Red ink has disappeared in most of those districts - and services / programs for students once cut are being restored.

Unfortunately, the unions, and their political allies (progressive democrats), responded in a manner similar to that done in Wisconsin - by calling out the thugs and advocating / embracing violence in an effort to intimidate  people to opposing 'right to work' legislation.  Unsurprisingly, the Goebbels-like mainstream media propaganda forces also joined in the attacks on the 'right to work' legislation, hiding and minimizing the violence being perpetrated by union thugs, and pulling out all rhetorical stops in lying about 'right to work' legislation.

The Washington Examiner, writing today about the union thugs and the violence they launched, was one of the few media outlets that attempted to honestly and accurately portray what 'right to work' laws really do...
Right-to-work laws do not ban unions. They merely ensure that workers can no longer be coerced to pay them. They also create workplace conditions under which even union members are no longer a captive audience, forced to bow to whatever decisions the union leadership makes.

And that’s what the union leaders fear most.
Teachers across Michigan called in sick to protest the House vote on the 'right to work' legislation - resulting in the cancellation of classes for over 26,000 students.

The irony with this is telling - as the teachers, and their powerful union, own much of the problems the state is facing with unions thanks to their collective bargaining agreements and union rules which limit the accountability of teachers, rewarding effective teachers, eliminating ineffective teachers, and drive up costs for school districts as taxpayers find themselves not funding education - but union coffers.  In Michigan's largest city, Detroit, itself on the verge of bankruptcy after three plus decades of progressive political leadership, only 7% of the 8th graders are proficient in reading.  Courtesy of the progressive political mindset - these results call for rewarding the teachers and the union as opposed to putting the needs of the students first and asking why are so few are proficient at reading.

As Michigan's House passed a 'right to work' bills affecting both private sector unions and public sector unions, largely by 58-51 party-line votes, pro-Labor Democrat progressives on the floor of the House threatened 'blood' will be spilt because of the actions taken by the democratically elected Legislature.  Not long after than threat - union thugs tore down and vandalized tents on the Capital grounds occupied by supporters of the 'right to work' legislation and assaulted a Fox News contributor, Steven Crowder for the simple act of exercising his free speech rights to speak in favor of 'right to work' legislation.

This is, unfortunately, no different from the violence perpetrated by union thugs in Wisconsin, Ohio, Indiana, and in other states when the people, and their elected representatives, consider or enact legislation intended to rein in the power and corrupting control that unions have on politics.

The same nimrods who spout off about 'tolerance' and 'rights' are the first to demonstrate that they are really liberal fascists - the modern day brown shirted thugs who believe they have the 'right' to destroy and assault those who oppose their agenda.

Yet much of what we hear from the progressive mouthpieces who marginalize and justify the thuggery of unions are arguments about how important unions have been and the role that they paid in the past.  No one denies that the labor movement at one time was needed and doing the right thing to protect the rights of workers from unscrupulous business leaders and dangerous work environments. Their efforts to focus the argument on this is nothing more than the use of fallacies to deflect the debate around the actions and values of unions today and their excesses.

Unlike in the past, we have in place laws at the federal, state, and local levels which are designed to protect the rights of workers - whether they are in a union or not.  On top of the numerous laws, we also have a litigation system that also holds employers accountable for their actions.  Workers have the freedom to leave a job that they do not like - and find a new job that offers more.

With all of this, one has to ask themselves just what value do unions really provide for the majority of their workers beyond the political clout and power to advocate their hard left political ideology?

We are constantly increasing our spending for education - yet despite the tens of thousands per pupil we spend - we are not improving the level of education of these students. Each year fewer graduate high school or have the basic levels of proficiency to get and hold jobs or attend college.  In the majority of colleges, much of the first year is spent on remedial studies to bring students up in skills to be able to function at the college level.

Collective bargaining agreements force school boards to purchase the health insurance used to provide this benefit to teachers and the administrators from the union itself - which it then marks up substantially above free market rates.  This greed means fewer dollars are available for school boards for real educational programs.  These funds, along with the dues collected by forced membership (in non-right to work states), are in turn used as political contributions to promote pro-union progressive democrats - who when elected then 'repay' the unions by offering even more favorable (to the unions) collective bargaining agreements.

This is the corrupt cycle that Wisconsin, in 2010, and Michigan, yesterday, voted to end...and launched the violent reaction by the union brown shirts.  At least those states are taking steps to end that cycle and restore their states to a path of fiscal responsibility that respects the taxpayer.  In California, now approaching 40 years of progressive political leadership, the problem - and the state's fiscal crisis - are approaching the point where bankruptcy is nearly here and a middle class exodus is underway.

In 2011, 100,000 more residents left CA for other states than it gained.  This was the first year where the state, in this category, had a net loss of population.  Prior to this, California with its weather, natural resources, and opportunity, was a destination.

The reason for this exodus has to do with the progressive political agenda at work throughout much of the state.  The state remains in a fiscal crisis - despite the passage of Proposition 30 which hikes $6B in taxes to address a $16-$25B budget deficit.  The state consistently spends far more than it brings in via revenues.  The progressive dominated legislature is at war with business - consistently ranking the state as not only the worst run in the nation, but also one of the most anti-business states in terms of their taxation and regulatory policies.

As it passes higher taxes - more people and businesses leave.  In my area, our economic development company spends its time touting how many businesses it has persuaded to remain (57 in 2012) than it does touting how many businesses it has persuaded to come to our community.  We don't talk about 'jobs created' but about 'jobs saved'.

Recently I talked about how the State Comptroller noted that state revenues continue to fall well behind the overly optimistic estimates built into the current state budget.

AB32 is the name of California's 'Cap and Trade' legislation intended to 'prevent' climate change and 'protect' the environment.  In the legislation, auctions were set-up to bring in revenues to fund climate change prevention, protecting the environment, and more recently, targeted by our Governor, to help fund the $100 billion high speed rail network boondoggle.  Oh, and also provide revenues to help reduce the budget deficit.

Unsurprisingly, the first cap and trade auction was a complete bust - delivering only 14% of the promised revenue to the state.
While they count on money from the auctions, California officials have imposed new costs on businesses, raised utility rates and put the state’s industrial products at a competitive disadvantage so that it can set an example for the world on how to reduce global temperatures. Democratic officials argue that the new green-energy model will energize the state’s business climate, but even the Air Resources Board admits that the state will suffer from what it terms jobs “leakage.”

The “leakage” might be a “floodage,” according to Dave Roberts, who reports for the website CalWatchdog. A study sponsored by pro-business groups estimates that the state will have 262,000 fewer jobs in 2020 because of the climate-change law. Roberts also cited a Boston Consulting Group finding that as many as 51,000 jobs might be lost due to refinery closings alone. California farmers and food processors are concerned that the rising state-mandated production costs will cause job losses as low-cost Chinese and Mexican processed-food imports take some of their business.
So, in addition to passing 'climate change' legislation that will result in the loss of a quarter of million jobs over the next 7 to 8 years and making California products less competitive in the marketplace, we're only bringing in a fraction of the additional revenues needed to keep the state from spending 30 cents on the dollar more than it brings in....and that is before we spend one years state budget on a high speed rail network that not only we don't need - but has no viable business plan.

What is California spending its money on?

We are spending most of our money on salaries, retirement payments, and healthcare benefits for government workers - nearly all of whom are members of public sector unions.

Progressives in this state, like those at the national level, never stop telling us that we have a revenue problem.  In reality, like at the national level, the problem is not revenues - but with the massive overspending that takes place.  Overspending on salaries of a bloated government, on the excessive retirement and benefit payments that come from politicians 'repaying' their union supporters via overly generous collective bargaining agreements.

Since 2005, in California, the compensation level of government employees has increased by more than 100%!

The numbers are even larger in California, where a state psychiatrist was paid $822,000, a highway patrol officer collected $484,000 in pay and pension benefits and 17 employees got checks of more than $200,000 for unused vacation and leave. The best-paid staff in other states earned far less for the same work, according to the data.

Mohammad Safi, graduate of a medical school in Afghanistan, collected $822,302 last year, up from $90,682 when he started in 2006, the data show. Safi was placed on administrative leave in July and is under investigation by the Department of State Hospitals, formerly the Department of Mental Health.

Another perk of public workers in Cali? $200,000 in accrued vacation pay:

The disparity with other states is also evident in payments for accumulated vacation time when employees leave public service. No other state covered by the data compiled by Bloomberg paid a worker more than $200,000 for accrued leave last year, while 17 people got such payments in California. There were 240 employees who received at least $100,000 in California, compared with 42 in the other 11 states, the data show. New Jersey Governor Chris Christie calls such payments “boat checks” because they can be large enough to buy a yacht.

Topping the list was $608,821 paid to psychiatrist Gertrudis Agcaoili, 79, who retired last year from the Napa state mental hospital after a 30-year career. Agcaoili said in a telephone interview that it was her right to take the payment.

Can California afford to pay those wages? Of course not:

Across the U.S., such compensation policies have contributed to state budget shortfalls of $500 billion in the past four years and prompted some governors, including Republican Scott Walker of Wisconsin, to strip most government employees of collective-bargaining rights and take other steps to limit payroll spending.

The result isn’t only a heavier burden on California taxpayers. As higher expenses competed for fewer dollars, per- pupil funding of the state’s public schools dropped to 35th nationally in 2009-2010 from 22nd in 2001-2002. Californians have endured recurring budget deficits throughout the past decade and now face the country’s highest debt and Standard & Poor’s lowest credit rating for a U.S. state.
This is why the claim pushed so often by Governor Jerry Brown and the other progressives that tax hikes are needed for students is such a canard.  If California would follow the model of Wisconsin or Michigan in adopting right to work laws, limited the power / corruptive influence of public sector unions, took a private sector based approach towards limiting the size and scope of government, and a more common sense approach towards public sector employee compensation, and the state would have not only a balanced budget, but also plenty of money for education.  State tax revenues, even after an across the board 10%-20% tax rate reduction, would increase because the state's economy would grow.  A rising tide lifts all boats.

But to undertake these steps - those in leadership positions have to have the state's well-being, the general 'good' in the forefront of their thoughts.  That is not the case with either the union leadership or the progressives that dominate the state's elected officials and legislature.  As 'The American Interest' noted as it talks about California's pampered public employees - -
“How bad is California’s public employee compensation problem? If nurses collecting $1 million in overtime pay and highway patrol officers making $500,000 are any indication, ‘bad’ doesn’t cover the half of it. . . . Public sector unions in states like California have squeezed every fringe benefit out of the state government you can imagine, from ‘arduous-duty’ pay, to bonuses for ‘the complex workload and level and knowledge required to receive and respond to consumer calls.’ These are not the demands of people who have the state’s well-being in mind.”

The nation is rapidly catching up to California in terms of fiscal irresponsibility - courtesy of the ideological progressive agenda of Barack Obama.  He and his fellow progressives continue to insist that the nation has a revenue problem - when it's plain to see that we have a spending problem.

In the current 'talks' around avoiding the 'fiscal cliff' just three weeks off, the President is insisting on a 'balanced' approach of tax increases and spending reductions to ensure 'fairness' - ie taxing the 'wealthy' more.  He is demanding $1.6 trillion in new revenues over the next decade in order to address the deficit / national debt challenge.  But even that is a lie.

75% of the proposed tax increases the President is demanding are slated to go to NEW SPENDING - not reducing the deficit or the debt.

If that is the case, then why does the President, his team, and the mainstream media continue to shovel the lie that the President is pushing for increased revenues in order to 'reduce' the deficits?  He's the most proliferate spender since the days of the Second World War.  We're spending 24% of our GDP - and with all of this spending, the economy barely is managing 1% to 2% annual GDP growth.  [The latest estimates for the 2012 4th Quarter GDP is a barely growing 1%.]  Real unemployment continues to exceed 11% - and that's not counting the effects of the millions who are underemployed.

I note that many reports in the press continue to push towards blaming the GOP for the failure of an agreement around the 'fiscal cliff' - just as the above cartoon by Michael Ramirez highlights.

Reports are coming from the GOP Congressional leadership that they are telling the members of the GOP caucus to plan on working through the Christmas break -and that January will also be a very busy time.

The problem is - Speaker John Boehner is approaching these talks in entirely the wrong way.  We know the President is not interested in a solution - just the opportunity to inflict massive political damage on the GOP.  We also know the President is not being honest - at all.  So the answer is to not play the President's or the MSM's game.

What the GOP needs to do in the House of Representatives is pass a bill to address the fiscal cliff and the spending / debt crisis we face.  Pass one bill - send it to the Senate and go home to enjoy the holidays.

What should be in this bill?

  1. Make the current personal income tax rates for everyone permanent.
  2. Really fix the AMT so that it does not affect middle class or those earning less than $300K / yr.
  3. Set a Corporate Tax Rate at 25%.
  4. Lock in Capital Gains and Dividend Tax Rates at 15%.
  5. Stop DoD sequestration.
  6. Roll back all discretionary non-defense federal spending to FY2007 levels plus inflation and population growth.
  7. Set a $50,000 maximum itemized deduction limit for wage earners making more than $1M per year.
  8. End the 2% temporary Social Security payroll tax reduction.
  9. Eliminate the Estate Tax.
Then in January, take up legislation to:
  • Reform Social Security, Medicare, and Medicaid.  They are between 50 and 75 years old and need modernization.
  • Reform the Tax Code to eliminate loopholes and broaden the base.  Everyone has to pay something - that is 'fairness'.
  • Halt the implementation of Obamacare until annual GDP growth is 4% or more and the total national debt is less than 80% of GDP.
  • Pass a FY2014 budget - set a model to achieve a balanced federal budget in no more than 5 years.
Pass those and send them to the Senate.  

Then use every chance possible to highlight that the GOP led House has taken steps while the President and Democrat majority controlled Senate have done nothing / are sitting on the bills from the House.  Put the President and his Senate sycophants on the defensive.  

The Chief Executive Officer of General Electric, Jeffrey Immelt, who also is the Chair of the President's Jobs Council - tasked with working with the WH to promote job growth, and interestingly hasn't met since early this year, has looked around the world and found a political / economic model that works and generates 'economic success'....

Immelt declares that 'state-run communism' actually works and points to the People's Republic of China as an example of economic success.

I wonder if the US, to achieve a similar level of success emulating the PRC, will have to also invoke a police state and murder between 50 million and 80 million of its citizens?


Another leftist standing on his 'principles' is making news in Europe.  Gerard Depardieu, the French actor, has decided to flee France and move to Belgium in order to avoid French President Holland's new 75% income tax rate on the country's wealthy as well as a new tax being imposed on the assets of the wealthy.

Egyptian President Mohamed Morsi has declared martial law ahead of the country's constitutional referendum to adopt a new constitution based on Islamic Shari'a law - eliminating women's rights, free speech, and bringing back slavery.  The declaration, which provides additional powers for the country's military to make arrests, is empowering the Islamists within the Egyptian military and reducing the reach and power of more secular military officers.  If the new constitution passes, I fully expect Morsi to re-establish the dictatorial powers he gave himself and then reversed.

Barack Obama has decided to reward Morsi's declaration of martial law by agreeing to send the Egyptian military 20 brand new F-16 fighter jets.

Feckless no longer describes the Obama foreign policy.  Dangerous.  Irresponsible.  Naive and inept - all of these seem to fit better than just feckless.

Monday, December 10, 2012

Quick Hits - Weekend Edition December 7-10, 2012

BS from the BLS...

On Friday, the Bureau of Labor Statistics released the November jobs data.  Holiday cooking isn't the only cooking that is going on, as the books are continued to be cooked when it comes to job data.  The sycophants in the mainstream media touted the 146,000 jobs added in November, and the drop in the 'official' unemployment rate to 7.7% as signs that the economic recovery is real.  ABC Radio News led the announcement with - 'Despite Hurricane Sandy's impact, the economy added nearly 150,000 jobs and the unemployment rate dropped to 7.7%....'

The LA Slimes leaps to tout the numbers with this example of rhetorical gymnastics...

"The nation's employers added an unexpectedly large but still moderate 146,000 jobs in November, despite the disruptions caused by severe storms in October."

Unexpectedly large, but still moderate.  Sounds so much like 'Fake, but accurate'.

What wasn't mentioned in the mainstream media's 'celebrations' of the November jobs report was that the 146,000 jobs added (after seasonal adjustment) barely covers our population growth.  On top of that, the only reason the 'official' unemployment rates dropped were because BLS decided to drop 546,000 from the labor pool - bringing the labor participation rate to 63.6%.  This is just 0.1%  higher than the 2012 low - and represents a 30 year low in the labor participation rate - and well below the rate that existed in January 2009 when Barack Obama took office.  If we were using the same labor participation rate as in January 2009, we would be looking at a 11% 'official' unemployment rate.

Even more quietly announced than the over half a million Americans dropped from the labor pool were the downward revisions of the September and October job creation numbers.  The BLS dropped the October numbers by 20% (33,000 fewer jobs) and the September numbers by 11% (16,000 fewer jobs).  How convenient that after the Presidential election we find out that Barack Obama's economy created nearly 50,000 fewer jobs than they took credit for.

CNBC's Rick Santelli took to the airwaves to also highlight another critical fact that is buried within the BLS numbers - that 73% of ALL THE NEW JOBS CREATED IN THE LAST 5 MONTHS are in GOVERNMENT....

"They love to lie about statistics...."

Even a former Obama Economics Adviser is starting to highlight the obvious - that the decline  in the unemployment rate is due entirely to the drop in labor force participation...

In another example of a stagnating economy, Gallup is reporting that small business hiring, the fuel for the economic engine, has fallen to a FOUR year low.  This is the lowest level of small business hiring since November 2008 - in the midst of the 2008-2009 recession.  Adding to the grim picture are 21% of the country's small business owners who expect to decrease the number of jobs they have in 2013.

Not only is government hiring providing the only 'spark' on the job creation front, the spending of the federal government has also increased.  We're only 2 months in the 2013 Fiscal Year for the Federal Government, but the Obama Administration has already borrowed $292 billion in order to fund the massive expansion of government.  This puts us well on the path towards our 5th consecutive year with an annual budget deficit in excess of $1 trillion.  We're borrowing $4.8 billion every day - a spending level equal to that of 2009 - and on path for a $1.4 - $1.5 trillion deficit that is well above the $1.1 trillion deficit the Obama Administration projected for 2013.

One of the biggest impacts on the massive spending is the ongoing unprecedented expansion of the federal welfare sate.

"The amount of money spent on welfare programs equals, when converted to cash payments, about "$168 per day for every household in poverty", the minority side of the Senate Budget Committee finds."

In the QH for Dec. 6th, I talked about the entitlement 'iceberg' that we are steaming full speed towards - a crash that makes the 'Fiscal Cliff' 22 days off seem far smaller...

These entitlements focus primarily on the three major drivers - Social Security, Medicare, and Medicaid....but welfare spending is slated to soar under the Obama Economic Plan...

Much of my previous QH post focused on the fact that we do not have a revenue issue - but a spending issue that is one of the most key drivers towards the 'cliffs' that this country faces.  In my discussion around the Obama solution to the January 2013 Fiscal Cliff, I talk about the President's core beliefs and principles which are in plain view in his 'solution'.  I reference his background as a disciple of Saul Alinksy - and how he's fully implementing the Alinsky plan in his 'solution'.  Another blogger has picked up on this linkage...
When one strictly adheres to the principles of Saul Alinsky, you don't negotiate, you intimidate. You don't take a stand, but make the other guy take a stand and then you demonize it. You create so much static with class warfare rhetoric that it drowns out reason and fact. A good case in point is the President's insistence that the wealthy do not pay their fair share. He has been saying this for so long, it is almost an accepted fact by some. The real truth is that the top one percent of wage earners have gone from paying 20% of the total tax burden in the 1980s to 40% today. The percentage of the total income they earn is around 25%. If one extrapolates out the tax burden to include the top 10% of wage earners, the total share of the tax burden paid by that group is 70%. Their total percentage of the income earned is around 38%. These facts come straight from current IRS data. No fair-minded person could conclude from the empirical evidence laid out in the previous paragraph, that the wealthy in this country are not paying their fair share. And yet, the President spews out this categorically false narrative and a certain percentage of the population laps it up like kittens lapping milk from a bowl. This is also what followers of Saul Alinsky practice, repeat a lie often enough and it becomes the truth in the minds of the masses.

Columnist Charles Krauthammer's December 7th column hammers the President's 'plan' -
Obama has never shown interest in genuine debt reduction. He does nothing for two years, then spends the next two ignoring his own debt-reduction commission.

In less than four years, he has increased U.S. public debt by a staggering 83%. As a percentage of GDP, the real marker of national solvency, it has spiked from 45% to 70%.

Obama has never once publicly suggested a structural cut in entitlements. On the contrary, he created an entirely new entitlement — ObamaCare — that, according to the CBO, will increase spending by $1.7 trillion.

What's he thinking? Doesn't Obama see looming ahead the real economic cliff — a European-like collapse under the burden of unsustainable debt?
Obama sees the cliff - as an opportunity, not a problem. An opportunity for to 'fundamentally change' the country.

A close examination of the Obama 'solution' highlights that not only will this 'solution' expand government spending via a new 'stimulus' program, but it also fails to highlight just where all of the $1.6 trillion in new tax revenue will come from.  As noted before on these pages, taxing the 'wealthy' their 'fair share' will only generate about $400 billion (best case) in new revenues.

Even the New York Times is starting to wonder where the additional $1.2 trillion in tax revenues will come from...
Even if Republicans were to agree to Mr. Obama’s core demand — that the top marginal income rates return to the Clinton-era levels of 36 percent and 39.6 percent after Dec. 31, rather than stay at the Bush-era rates of 33 percent and 35 percent — the additional revenue would be only about a quarter of the $1.6 trillion that Mr. Obama wants to collect over 10 years.
So where will the other 75% of the additional tax revenues come from?  The President has not explained that.  He, and his Congressional allies, are unwilling to say.  They don't support reforming the tax code - that is one of the core GOP positions.  Just about the only place these additional funds can come from is from EVERYONE else - the Middle class and the Poor.

Which makes me also wonder why people aren't finally starting to pick up on another massive canard spread by Barack Obama and his sycophants - that the Bush 'tax cuts' "only benefited the rich".

We've been told this for the last 4 years - that the Bush tax cuts only benefited the rich.

Just how does a 10% across the board tax reduction for every tax payer only benefit the rich?  Every single person who pays personal income taxes got the same 10% reduction in 2001 / 2003.  And if the 10% across the board tax reduction done in 2001 / 2003 only benefited the rich - why did their percentage of the federal income tax receipts increase after the rates were dropped?  Isn't paying a greater percentage of the federal income tax receipts right in line with 'paying their fair share'?

No wonder the media isn't talking about this.  The President and his supporters have been trapped by their own rhetoric in their argument over the solution for the 'fiscal cliff' - and are exposed as hypocrites.

Barack Obama, Harry Reid, Nancy Pelosi, Chuck Schumer, and Dick Durbin are out speaking to whomever who will listen that the GOP's refusal to surrender to Obama's 'solution' is going to hike taxes on the middle class when the 10% across the board tax reduction enacted during the Bush Administration, and extended by the Obama Administration in 2010 expires.

But if it didn't benefit the Middle Class - then how are the Middle Class going to be damaged by its expiration?  And if the Middle Class will be damaged by the expiration of the 2001 / 2003 tax rates - then how does the establishment of those rates only benefit the 'rich'?

The Obama Administration is not serious in wishing to address either the January 2013 'fiscal cliff' - or the other cliffs that we face as a result of our soaring spending and national debt.  Unfortunately, neither are the GOP leadership under Speaker John Boehner who don't want to stop the bleeding - just slow it down a bit.

In another step that will screw over the American people, in particular the middle class and poor, the Administration is considering in maintaining the current withholding tables in the event no deal is reached and personal income taxes increase across the board by 10% on January 2, 2013.  The 'justification' for this decision is to prevent people from seeing the impact of the tax increase in their paychecks.  The problem is that this only masks the effect via withholding.  When taxpayers sit down in early 2014 to prepare their 2013 Income Tax Returns - they are going to see the impact of the Administration's shell game when they have to write checks to the IRS to cover the difference between their tax obligations and the amounts withheld by the IRS.

Keeping on the subject of the 'Big Lies' advocated by the Obama Administration and their sycophants and economics, we have one of MSNBC's most moronic hosts, Lawrence O'Donnell, trying to advocate the 'Big Lie' around the canard that the Clinton 1993 tax increase sparked the 1995-2000 economic boom while appearing on NBC's 'Meet the Press'.

Unfortunately for the clueless O'Donnell, Newt Gingrich was also on the program.  The former Speaker then schooled O'Donnell in the simple truth of the matter - that it was the balanced budget / spending controls plus a drop in the capital gains tax rate pushed by the GOP Congressional Majority and signed onto by President Clinton, combined with the Internet bubble, that sparked the economic growth - not higher tax rates.

In fact, the Gross Domestic Product shrank in the first year after the Clinton tax hikes to an annual rate of 2.9 percent down from 1992's 3.4 percent.

That's right: the economy as measured by GDP was better the year before Clinton took office and raised taxes than it was the year after.

By far the best years under Clinton came after the Republican tax cuts when the GDP grew annually by 4.5 percent, 4.4 percent, 4.8 percent, and 4.1 percent from 1997 to 2000.

The best job creation also occurred after the Republicans took over Congress with less than seven million new jobs created in 1993 and 1994 compared to over sixteen million in the next six years.

As for the fiscal impact of the Clinton tax hikes, the left always ignores that we ran budget deficits in his first term. It was only after the Republican tax cuts that surpluses occurred.
Also not referenced - federal government revenues post the 2001 / 2003 'Bush Tax Cuts' were greater than than the revenues the federal government received during the higher Clinton tax rates.  FY2007 set a record for federal revenues at $2.7 trillion.

Which reminds me - the President also still hasn't told us how he intends to average $4.7 trillion in federal government revenues over the next decade in order to limit the growth in the national debt to just under $7 trillion.  We hit our record revenues 5 years ago - and just how the hell are we to exceed that record by $2 trillion per year when we have sub-2% annual GDP growth and a real unemployment rate of over 11%?

Remember reading all those progressive newspapers touting the end of California's fiscal crisis with the passage of Proposition 30 - hiking the state sales tax by .5% and raising the top state income tax rate to 13.3%?  Well, reports of the end of the fiscal crisis are, unsurprisingly very premature.  State tax revenues are in freefall - running 10.8% below the November budget predictions and spurring concerns that California is going to learn the same lesson the French, British, New Yorkers, Marylanders, and others who punitively hiked taxes on the wealthy - that the wealthy taxpayers will leave in order to avoid the punitive tax.

Gas prices are dropping across the country - down an average of 46 cents per gallon in just the last two months.  Fueling the price drop is substantially lower demand for gasoline - on par with the level of demand we saw in the winter of 2001.  This is an untimely blow for MSNBC loon Chris Hayes, last seen denigrating the American service members, who believes that energy prices are far too low.  Hayes wants the President to substantially hike gas prices so that renewable (green energy) alternatives become immediately economically viable despite the negative impacts such a move would have on the economy and in particular the poor and middle class.

Speaking of the government picking winners and losers in green energy, A123 Systems, a battery manufacturer for electric cars which received over $500 million in government grants and tax subsidies before filing for Chapter 11 bankruptcy, was sold to a Chinese company today for about $247 million.

In another example of government incompetence, we have the School Board for Poway, California who will pay $1 billion in order to retire their $100 million bond...
These bonds in question are known as Capital Appreciation Bonds (CABs), and they are unlike typical bonds because they allow "districts to defer payments well into the future — by which time lots of interest has accrued."

California's State Treasurer Bill Lockyer has determined that nearly 200 school districts in the state have borrowed nearly $3 billion in CABs and are on the hook for a combined $16 billion.

According to NPR, Lockyer said such bonds are the “the school district equivalent of a payday loan or a balloon payment” where “you have a spike in interest rates that's extraordinary."

Lockyer is "poring through" a database to determine which districts are at most risk but has come to the conclusion that most of these bonds cannot even be refinanced. One such district is West West Contra School District, which is just outside of San Francisco. In 2010, the district took a $2.5 million bond in order to get $25 million to build an elementary school, which seemed like a net gain of $22.5 million for the district at the time.

Not so fast.

That $2.5 million bond will ultimately cost the district a whopping $34 million to pay over its term.
As the article notes - this is not an isolated example of fiscal irresponsibility inside California.

California is not, despite the massive need to, invoke similar reforms to those done in 2010 by Wisconsin to reduce the power and control of unions.  However, Michigan's legislature is enacting legislation to make the state the next 'Right to Work' state.  Unions in the state are promising massive disruptions, protests, and political turmoil if the Governor moves forward and signs the legislation into law.  They are pointing to the discord and division they promoted in 2010-2012 in Wisconsin and insisting they will do the same in Michigan.  OK - as I am sure that those in Michigan are also hoping that the what happened in Wisconsin, economically, also happens in Michigan - a major fiscal turnaround.

We'll wrap this weekend's edition of QH with Bill Whittle's latest 'Afterburner' edition - Unserious People...

Thursday, December 6, 2012

Quick Hits - December 6, 2012

Bashir al-Assad, Syria's dictator, placed his toes on the edge of the Red Line last night as multiple sources confirmed the Syrian military had completed preparation for loading Sarin gas onto delivery systems.  For the next 60 days, the 'half-life' of the nerve gas, only an order from Assad prevents the Syrian military from using WMD on their own people.

If that line is crossed - what will the US or NATO do?  That is one of the questions that Assad has to be asking himself as he tries to decide whether to stay in Syria until the bitter end or bolt to a convenient exile location like Cuba, Venezuela, Bolivia, or Ecuador.

How will Barack Obama deal with this 3AM call?

We already know how President Obama is reacting to the 3AM call he's received from Egypt over the escalating violence around the Islamist Morsi granting himself dictatorial powers.

We also know how the President decided to address the 3AM call from Benghazi, Libya on September 11, 2012.  Pretty much the same way as he needed his beauty sleep before attending a morning campaign fund raiser in Las Vegas.

What makes the fiasco of Benghazi even worse is that the Islamist terrorists who launched the 8 hour long attack on two US diplomatic facilities in Benghazi were armed, according to a report in the New York Times this morning, by a secret weapons deal approved by the Obama Administration.

How nice that the NYT has decided to report this AFTER the Presidential Election.  It's stunning the amount of valuable info that becomes available after they shilled for Barack Obama's re-election.  Like the other disclosure where the New York Times admits that 'Reaganomics worked'.
The inadvertent revelation comes in a November 29th article by Binyamin Appelbaum chronicling the steadily falling tax burden Americans have experienced since the 1980s.

AEI columnist James Pethokoukis notes that the heart of The Times' article is that in 2010 Americans "paid far less in total taxes -- federal, state and local -- than they would have paid 30 years ago."

Pethokoukis points out that some tax hike advocates think this means that America's tax burden is too low and time has come for a hike. But Pethokoukis disagrees.

Maybe I’m crazy, but I think the reduction in the tax burden — staring with the Reagan tax cuts — has been a huge competitive advantage for the U.S. We should keep that edge. Check out these numbers. In 1981, France’s per capita GDP was 81% of U.S. per capita GDP, Germany’s 83%, Italy’s 81%, Britain’s 69%.

In 2010, France’s per capita GDP was 73% of U.S. per capita GDP (down 8 points), Germany’s 81% (down 2 points), Italy’s 68% (down 12 points), and Britain’s 76% (up 7 points).
Pethokoukis reminds readers that Europe was closing the gap with U.S. wealth by 1980, but after Reagan's tax cuts that trend stagnated and in other cases even began to reverse.
This is a good segue to the main focus for today's post - Economics, Fiscal Cliffs, and how we, the American people, are losing regardless of who 'win's' the current negotiations.

First, let's understand something very simple.  The fiscal cliff, 'Taxmageddon', the 'witching day' of January 1, 2013 when a host of bills expire and subject the American people to a number of significant tax increases, is not an accident.  It's not happening by chance.  It's happening by design and by policy.
Year after year, the Democratic-controlled Senate, ignoring the law, refuses to pass budgets.

Year after year, Washington makes big government cheap by charging Americans only $6 for every $10 of government services, borrowing the difference. And the biggest purchaser of U.S. government debt is not China but ... the U.S. government, largely through the Federal Reserve.

Yet what supposedly is horrifying is a sequester that would cut less than 3% of federal spending over the next decade? Or horrible Grover Norquist.
George Will, writing the above, just starts to touch on the issues.  Yes, issues - plural.  And it's all according to plan.

Barack Obama is a true disciple of Saul Alinsky.  He's acting on his deep rooted ideological roots intending to 'fundamentally change' what he sees is a broken country - one that is 'unfair', that 'oppresses the poor', and is based on the foundation of an economic system (capitalism) that is fundamentally flawed.  He sees his role as providing 'justice' for those 'wronged' by that fundamentally flawed economic system.  For ensuring the equality of results.  That government and the state is the only and best tool to manage the economy to ensure 'fairness', 'balance', and deliver 'social justice' to all the people.  The government has to right the wrongs of the past two hundred plus years in order to move beyond it's history.  Among these wrongs that he has to fight are 'racism', 'sexism', and the greed of wealthy who obtain their gains on the backs of the disadvantaged.

He, and his progressive liberal fascist supporters, highlight and call out 'racism', 'sexism', and use the meme of class warfare to target, personalize, and demonize those who wish to maintain that fundamentally flawed system.  To him, and his allies, the use of projection is second nature -and he (they) do not see anything wrong with it because to further their ideological agenda, to achieve the utopia they envision, they have to be all in.

To achieve what he believes in his core is the only 'fair' system - Barack Obama doesn't care if the country goes over the cliff.  This cliff is a creation of Barack Obama and his allies in Congress. They are the ones who planned to set the expiration dates of the 2001-2003 Tax Reductions, the Temporary Payroll Tax Reduction, and the hitting of the new Obamacare taxes for January 1, 2013.  Add to these, the plan by Obama and the Congressional Democrats to set the next confrontation around the debt ceiling around the same time.

Crises are opportunities in the Alinsky school.  They offer the ability to expand the agenda via 'fixing' the problem as well as a circumstance to affix blame, demonize, and personalize the opposition in order to sway the opinions of the masses.  If they do not occur naturally - create one in order to create the meme to 'justify' the solution.

Even failures are no longer issues or impediments.  Failures do not occur because the ideological agenda is flawed, failures occur because of the adverse action by opponents to the actions, or that the action was 'watered down' as the result of previous negotiations - and not implemented thoroughly enough.  In that case, then the 'solution' is the more ideologically 'pure' implementation.  Once the door is opened, and the foot is across the threshold, there is no going back in the Alinsky model.

For example, Obamacare, as it is currently designed is intended to fail.  The ultimate goal of the progressives was to obtain a single-payor government controlled healthcare system not unlike Britain's NHS.  They were unable to do this, so what was created was a manner to open the door and get the foot across the threshold - pass the law and then have it survive electoral and judicial review.  When Obamacare 'fail's, the solution will not be to 'roll back' Obamacare and return to the 'unfairness' of a free market system - but expand government control of healthcare.

[This was the same philosophy Jacques Delors, the principal architect of the Euro, followed as he pressed for the EU and single European currency.  What was actually implemented was flawed and known to be flawed - but a step towards a complete Union which was the ultimate goal. Now in the midst of the Euro-crisis, the leading 'solution' is moving more to a complete Union - not moving back.]

Assisting Barack Obama in achieving his goals are the incompetents of the GOP Congressional Leadership - particularly Speaker John Boehner, who lack the fortitude to stand on and defend conservative principles and traditional American values.   They appear far more concerned about keeping their power and popularity in the short term than taking a stand for the benefit of the country in the long term.  As they pontificate about their 'hard-line' positions, all they are offering are just a slightly smaller, slower incremental step towards the progressive agenda advocated by Barack Obama.  They are acting as if they fear the effect of the propaganda of the progressive mainstream media more than they fear the effects of their voters / base.

To make a historical analogy, if Winston Churchill acted like these 'leaders' during his years of political exile in the 1930's - he would never have sounded the alarm over Hitler and Nazi Germany.  He never would have pushed for the re-armament of Britain.  He never would have stood alone against Nazi Germany in June 1940 - and likely would have sought a negotiated peace with Nazi Germany during the summer of 1940.

So why am I, a conservative, castigating the Speaker of the House and other GOP Congressional leaders, in these negotiations?  Because they aren't negotiating based on conservative principles.  They aren't fighting.  They aren't making their case in the media or taking it to the American people.  All they are offering is just a watered down / slower approach to the progressive agenda of 'fundamental change'.

This is the problem.  Neither side is working towards FIXING THE FUNDAMENTAL PROBLEM we are facing which is the excessive spending and expansion of the Federal Government.

Barack Obama's 'offer' to the GOP to avert the 'fiscal cliff' is basically the President's rightfully maligned FY2013 budget plan.  Despite getting exactly ZERO votes in the House and the Senate when brought for a vote earlier this year - this is the President's plan and agenda.  It's all about 'fairness', 'balance', and 'social justice'.  It's also ALL ABOUT SPENDING.

According to the President's plan - between 2013 and 2023, he intends the Federal Government to spend $47 trillion dollars.  Let that set in for a second... Over the next DECADE, he wants to spend an average of $4.7 trillion dollars PER YEAR.  He's spending about $3.8 trillion dollars this year, which is about $1 trillion more than we spent in FY2007 - the last all GOP budget.   So, over the next decade, he's intending to increase spending nearly another $1 trillion per year.

The current spending, when compared to the size of our GDP, is about 24% of GDP.  This is matching the all-time - which last occurred during the Second World War.  From 1960 to 2008, federal government spending averaged 20.2% of GDP.

Our GDP, is struggling to grow at a 1.5%-2% rate per year - well below the 4-5% rate that the President expected and projects in his budget plan.  At the projected rate of spending increases, we will remain spending nearly 20% more than we did between 1960 and 2008.

In 2012, the receipts of the federal government were approximately $2.6 trillion - about $200-$250 billion below the all-time high receipts which occurred in 2007 (and when the budget deficit was only $161 billion). Obama's economic plan projects a nearly 20% increase in federal government revenues in 2013 and 2014 - an then about 8% annually for the remaining 8 years of the next decade.  All told, his plan says that over the next decade the federal government will bring in about $40.3 trillion of revenues.

The annual average of revenues the President projects?  $1.2 trillion higher than our ALL-TIME HIGH.

The end result of this spending and revenues - ADDING ANOTHER $6.7 trillion to the $16.35 trillion national debt that has been already accrued.

Let that sink in - if the President gets what he wants - and the economy / tax policy performs as they believe, we will expand our national debt from $16.35 trillion to $23.05 trillion.  Or - to look at it this way - about $13 trillion more than it was when it took office on January 2009.

But even this is an incredibly optimistic and unrealistic scenario.

Our economic growth is a third or less than what is being projected.  While spending is soaring, the President is claiming that new tax 'fairness' will generate revenues.  But returning the 'wealthy' to the Clinton-era tax rates only brings in about $80 billion in additional revenues -IF WE ASSUME THE HIGHER RATES DO NOT HAVE A NEGATIVE IMPACT ON THE ECONOMY.  That $80 billion, or $800 billion over the next decade is only about 20% of the total revenues the President projects will be raised over the next decade.

Where are the OTHER REVENUES GOING TO COME FROM?  Economic growth?  Not hardly.  They will come from even more taxes - not only on the wealthy, but also on the backs of not only the middle class, but everyone.  And it still will only be enough, if all works out, to limit the increase of the national debt to $6.7 trillion.  [Realistically, I expect it to be far closer to $10 trillion over the next decade.]

In his 'offer' to 'avert' the fiscal crisis - the President calls for $4 in new taxes for every $1 in spending cuts.  He seeks, over the next decade, to reduce the debt by about $1.2 trillion via this formula.

If we assume the speculations are accurate, this means that the President is willing to change his plan so that rather than increase the national debt over the next decade by $6.7 trillion (to a $23.05 trillion total), he will ONLY increase the national debt by $5.5 trillion ($21.85 trillion total).

The national debt will still increase - and by an amount in the next decade only a less than what Barack Obama added in his first 4 years [as he added as much as the combined totals of President's 1 through 42 plus the first half year of 43's term].

The debt crisis is not being averted.  It will get worse under the President's plan over the next decade.

The President is, as I've noted before, running the progressive agenda.  He seeks to increase taxes, expand government and government control to manage the economy, increase the size of government to instill 'fairness', 'balance', 'social justice' [pick winners and losers] so that the country 'is a better place'.  Wealth gets redistributed via the 'fairness' of the government.  Poverty and racism end.

The conservatives stand on different principles.  They believe in lower taxes - keeping wealth within the private sector, moving the government out of the way of the private sector to encourage growth, and generate the funds to pay for government with a lower, simplified tax code where economic growth is the fuel behind higher revenues.  They believe in equality of opportunity as opposed to the equality of results - and individual rights and accountability.

But these aren't the principles that Speaker John Boehner is standing on for his 'negotiations' with Barack Obama to move us away from the fiscal cliffs we are racing towards.

Speaker Boehner's 'solution' is to agree to $800 billion (over the next decade) of higher taxes, while calling for about $3 trillion of spending reductions over the next decade.  In sum, what John Boehner sees as a solution is to reduce what we are going to spend over the next decade by about $3.8 - $3.9 trillion.

So, rather than increasing the national debt over the next decade, $6.7 trillion, he wants to ONLY INCREASE the national debt by $2.8 to $2.9 trillion.

This isn't cutting the national debt - it's just a proposal to SLOW DOWN THE GROWTH of the national debt.  Furthermore, if we look at a more likely $8-$10 trillion increase the Obama agenda will deliver over the next decade, Boehner is only proposing to slow down the rate of spending by 30-35%.

How is that going to help us?  That's a fix?

All John Boehner is doing is offering to let the country bleed a little slower - we'll still bleed to death.

The crises we face require far more drastic measures than are being offered by the GOP Speaker of the House.  It also requires far more fortitude than the Speaker has.  The longer we wait to fix the fundamental problem we have around spending and debt - the harder the fix will be.  To 'win' - all Obama has to do is make it 'too hard' to reverse his agenda...once the tipping point has been reached it will not be reversible and the country will have become 'fundamentally changed'.

Wednesday, December 5, 2012

Red Lines Redux - UPDATED

In usual parlance, the term 'Red Line' is meant to imply a line or barrier that cannot be crossed without some severe ramification... like an engine's RPM exceeding it's 'Red Line' maximum after which point the engine is at risk of 'blowing'.

The Obama Administration has putting this term's use into overtime these days - defining red lines for the actions of the bloody Assad regime in Syria regarding it's chemical weapons as well as defining red lines for the negotiations that are supposed to be taking place between the White House (on behalf of Congressional Democrats) and the GOP Congressional Leadership.

In the last several days, the President or his minions have announced 'Red Lines' regarding not bringing any discussions or negotiations about entitlement reform into the scope of the fiscal cliff debate - excluding the three largest programs (Medicare, Medicaid, and Social Security) which are part of our federal spending.

They have announced 'Red Lines' around the President's flip flop in new revenues, insisting that new revenues come from higher income tax rates on the wealthy.

They have also announced 'Red Lines' around the usual vapid qualifiers on any agreement - saying that any solution that doesn't meet their (slightly warped) definitions of 'fairness' or 'balance'.

The effects of these 'Red Line' qualifiers?  To define, for all practical purposes, that the President sees no personal or political downside for taking the country off the fiscal cliff.

He knows very well that his sycophants in the mainstream media will attack and blame the GOP for their failure to 'compromise' - or as most of define it, surrender.

Thinking about this, I've noted a couple of other interesting aspects.

First, one can only have wished, as the we look at the Middle East - and in particular the rise of Islamic Jihadist and al-Qaeda in the region over the last couple of years along with Iran's accelerating efforts to produce a nuclear weapon, that the President was as insistent and active with tossing 'Red Lines' at the Islamic fundamentalists and Iran as he is with tossing them at the GOP.

Second, if there was any doubt that the President intends to take the country over the cliff in his effort to destroy the GOP, that disappears with the latest buzzword being used from the President, to Jay Carney, to SecTreas, and others in the Administration to demonize the GOP.  Because starting today, all of the above are insisting that the GOP, in their refusal to surrender and accept the President's ludicrous offer, are now holding the process 'hostage' and forcing the President to shoot / take the country over the cliff.

This rhetoric will do little to prevent plunging off the cliff - and only frames the argument that the intransigence of the GOP is the problem when the person / entity being intransigence is the President who is insisting not only on hiking taxes, but getting a carte blanche approval from Congress to have sole control on the debt ceiling.

There's been no counter-offer from the President - and no clearly no response from the President that demonstrates any willingness to reduce spending - even though the President has increased spending over 30% in the past 4 years.  He continues to insist that our challenges are related to insufficient revenues- not too much spending.  Even more laughable is that his 'solution' for revenues will only cover about 7% (at best) of the current annual deficit.  What about the other 93%?

But perhaps the most asinine insistence from the President, beyond the GOP's outright surrender, is the demand that he gets carte blanche on setting the US National Debt Ceiling - which is basically an intent to eliminate that debt ceiling.

Let's put that request in a form that all of you understand... It's like going to your bank, where you have a large credit card debt balance, and since you are at your credit limit, demanding bank grant you an unlimited credit limit in order to allow you to reduce your credit card balance.

Why doesn't the President just demand that all banks also eliminate their credit limits too if that is such a great solution for massive indebtedness?

These economic ideas can only come from a community organizer.

UPDATE - Maybe that is why Harry Reid, the Senate Majority Leader is declining to bring the President's 'fiscal cliff' plan to a vote in the Senate...

If the President’s proposal was made in good faith, Democrats should be eager to vote for it. So I’m surprised the Majority Leader just declined the chance for them to support it with their votes. I guess we’re left to conclude that it couldn’t even pass by a bare majority of votes, and that they’d rather take the country off the cliff than actually work out a good-faith agreement that reflects tough choices on both sides. … I think folks should know who actually wants to raise taxes on family farmers and manufacturers, and who thinks we can solve our fiscal problems without doing anything serious to our real long term liabilities. Democrats are so focused on the politics of this debate they seem to forget there’s a cost. They’re feeling so good about the election, they’ve forgotten they’ve got a duty to govern. A lot of people are going to suffer a lot if we go off this cliff. That’s why we assumed Democrats wanted to avoid it. We thought it was the perfect opportunity to do something together. Apparently we were wrong.

'Pinky' Reid's response? It's all just a 'stunt'.

A 'stunt' like defining 'Red Lines' and using rhetoric that the GOP is holding the country 'hostage'?

There is no good faith intent by the President or his allies to prevent the country from going off the cliff.

That's a feature - not a bug.  

Because one doesn't let a crisis go to waste - and if you don't have a convenient crisis - create one.