Showing posts with label economic. Show all posts
Showing posts with label economic. Show all posts

Wednesday, April 4, 2012

A great case against the Obama administration

A great case against Obama and his administration. We MUST change this is November! Please pass this along.

Who is responsible for the current economic malaise? If you ask Bill Whittle, it's Obama's pals like David Axelrod, Harry Reid and Tim Geithner, some of the many Merchants of Despair. These merchants are costing taxpayers trillions and creating deep national divides based on class and race. Will the despair continue for another four years? Find out.

http://youtu.be/Y-FGgoReyNE

Wednesday, February 8, 2012

Legislative Update: February 3, 2012

Provided by Tea Party Patriots!

PASSION TO ACTION!!

The House voted last week to repeal the CLASS Act – a piece of Obamacare and another unsustainable entitlement – and now it’s the Senate’s turn. Starting Monday, February 6, we started asking all patriots to call the Senate and tell them to bring the CLASS Act Repeal to a vote, and to vote YES! (**See the Passion to Action Add-On at the end of the update!)

Federal Budget

Surplus? No way:  Did you know that in January 2007, the CBO published its ten-year budget projections covering 2008 to 2017. This report projected an $800 billion surplus over ten years, including surpluses every year from 2012 to 2017. Four years later, in January 2011, the $800 billion projected surplus from 2008 to 2017 turned into an $8.8 trillion deficit over this same period.

No budget yet:  Wednesday, February 8th will mark the 1015th day since the Senate has passed a budget. Just this week, Senate Majority Leader Harry Reid (D-NV) said, “We do not need to bring a budget to the floor this year — it’s done, we don’t need to do it.” The Democrats are trying to say that they passed a budget when the debt ceiling deal was passed – but this is false. Did the debt ceiling deal allow them to continue discretionary spending? Yes. Was it an actual budget resolution? No. Let’s break it down:

“But if what Reid and Schumer are saying is that they’ve followed the law and submitted a budget resolution, then they’re flat-out wrong. The Congressional Budget Act requires the president to submit a budget to Congress by Feb. 1 every year. The Senate Budget Committee is to report a budget resolution to the full Senate by April 1. The House and Senate are to reach agreement on a concurrent budget resolution by April 15. Senate Budget Democrats haven’t submitted a budget since 2009. Here’s why it matters: The Appropriations Committee determines levels of discretionary spending. Approps don’t touch mandatory spending. But mandatory spending constitutes about 60 percent of all federal spending — and mandatory programs like Medicare, Medicaid and Social Security drive our deficits and debt. Without the imposition of budget discipline, these programs grow on autopilot.”

No budget? No paycheck:  Rep. Paul Broun (R-GA) has introduced a bill called the Budget or Bust Act (HR 3883). This bill would force the House and the Senate to pass a budget or risk not receiving their paychecks! It would also remove the President from the budgetary process and return the power of the purse to Congress completely.

President’s failure: Remember this as well about the President’s failure to offer a budget:

o In just one term, President Obama has missed the budget deadline more than any other President.

o In the 90 years covering FY1923 through FY2013, President Obama is the only President to miss the deadline two years in a row. He is the only President who has missed the deadline in three of the four years of a term. And, he holds the record for the longest delay (at 98 days).

o Since the statutory deadline was extended to the first Monday in February, with the exception of the first budget for a new President, this deadline has only been missed three times: Clinton FY1998; Obama FY2012; and Obama FY 2013.

o The President’s flagrant disrespect for budget deadlines extends beyond the late submissions of his annual budget request. The President is required to submit a Midsession Review no later than July 16 each year. The President is required to submit a Financial Report of the U.S. Government no later than December 15. The President is required to submit a plan to shore up Medicare’s finances within 15 days of a funding warning by the Medicare Trustees. Not once has President Obama adhered to any of these deadlines. Read the full analysis here.

Budget process reform: Two of the budget process reform bills were passed in the House this week. They are:

o HR 3582, The Pro-Growth Budgeting Act of 2012 – This bill would require that for major legislation that CBO prepare an analysis of the effect that the legislation would have on the U.S. economy. This macroeconomic impact analysis would be supplemental information in addition to the official congressional cost estimate of the legislation.

o HR 3578, The Baseline Reform Act of 2012 – Under current law the baseline assumes ever higher spending as discretionary accounts are annually increased by inflation and for a number of other factors. This legislation levels the playing field and removes this pro-spending bias.

o The third budget process reform bill did not come up for a vote this week. No word yet on when it will. It is:

 HR3581, The Budget and Accounting Transparency Act of 2012 – This bill increases transparency in federal budgeting by reforming the way certain costs are calculated and requiring that certain costs incurred by the Federal government are included in the budget.

Deficit: The CBO released its annual Budget and Economic Outlook this week, projecting that the federal government’s budget deficit will exceed $1 trillion for the fourth year in a row. With the debt on pace to grow to unsustainable levels in the years ahead, the CBO estimates that economic growth will remain slow and that the unployment rate will exceed 9 percent next year. Key facts from their report:

o Real economic growth is projected to be to 2.2 percent in 2012, falling to just 1.0 percent in 2013;


o The unemployment rate is expected to reach 8.8 percent in 2012, 9.1 percent in 2013, and 8.7 percent in 2014;


o The FY2012 budget deficit is projected to equal $1.079 trillion, the fourth consecutive year with the budget deficit above $1 trillion;


o Total debt is projected to reach $15.99 trillion in 2012, with debt held by the public to eclipse the $11 trillion mark in 2012 (72.5% of GDP);


o Debt held by the public is projected to exceed $15.3 trillion by 2022.

Obamacare

 Obamacare snuffs out small business job creation

 Catholic bishops vow to fight against 1st Amendment violations

 Repeal of the CLASS Act was essential

 CBO report shows Obamacare costs rocket out of sight

 Crony capitalism & Obamacare lead to job losses

 Down with the state exchanges!

 Doctors do not support Obamacare

 Ramping up for rationing

Education


Union Radicals Harass Teacher Who Dared to Support Governor Walker. A teacher with the courage to speak out: Teachers like LaCroix do not turn against their unions for the fun of it. They do so after years of watching a very political, power-hungry organization suck the life out of public schools and kill opportunities for students. LaCroix is one of those teachers who just want to teach, without the constant distraction of organized labor.

Illegal Immigration

Documentary: TPP North Carolina State Coordinator Mark Hager assisted with the documentary titled, “Invasion: Freedom Under Fire!” about the struggles of American citizens who live along the southern border. If you would like to order a copy, please click here for more information.

Waivermania: Kansas’ Agriculture Secretary is asking the Department of Homeland Security for a waiver so that agricultural businesses in Kansas could hire illegal immigrants. The agriculture businesses and others in the business community are supporting this effort. So far the Obama administration have handed out healthcare waivers and educational waivers. Are illegal immigrant waivers next? When waivers become the law of the land, there is no law.

Alabama too: The Attorney General in Alabama is trying to get the legislature to gut their new, stricter laws dealing with illegal aliens because he doesn’t want to have to go to court to fight for it. The Chamber of Commerce and the agricultural businesses are also supportive of the attempt to gut the laws.

Agenda 21

Redevelopment Reform: Read: "Redevelopment: The Unknown Government" to understand why this is so detrimental to your property rights and fiscal responsibility.

Petition to Speaker Boehner: Tom DeWeese and the American Policy Center created a petition to alert Boehner to the recently passed resolution of the RNC, acknowledging Agenda 21 and vowing to oppose it. Sign here.

RNC Resolution:  Many counties across America are jumping all over the RNC resolution. The state of TN and GA have also created resolutions. Start talking to your county commission and Republican party leaders and get your county/state on the list.

Rio 20 years later: It is obvious where this report is leading. More pressure on the US to send more money to the UN.

Must-see video: This is a 30-minute TV interview with Heather Gass from CA. It speaks to what is going on in CA regarding Sustainable Development and Regionalization. This is happening everywhere; it is just further ahead in CA. But these issues are the issues we will deal with in the future if we don't stop the plans now.

Smart meters: American Academy of Environmental Health is calling for a complete and immediate moratorium on the deployment of Smart Meters in California. Smart meters emit continuous radiation and could have serious effects on health. Objectors who are concerned about health and side effects may actually have to pay not to have a smart meter. This is absurd.

More university indoctrination: The "STARS" program is a propaganda program to persuade college kids into believe in the left’s ideas of “sustainability,” social justice, and social engineering.

House of Representatives – what are your thoughts on these bills?
Summaries provided by the RSC

CLASS Repeal:  On Wednesday, the House approved H.R. 1173, the Fiscal Responsibility and Retirement Security Act by a vote of 267-159. The bill repeals title VIII of Obamacare, which established the Community Living Assistance Services and Supports (CLASS) Program—a national, voluntary long-term care insurance program for purchasing community living assistance services and supports. Title VIII also authorized and appropriated funding through 2015 for the National Clearinghouse for Long-Term Care Information first established in the Deficit Reduction Act of 2005. H.R. 1173 replaces those appropriated funds for the clearinghouse for 2013 through 2015 ($9 million) with funding subject to future appropriation actions. CBO estimates that enacting the bill will have a budgetary effect of reducing direct spending by $9 million and subsequently increasing spending subject to appropriation by $9 million over the 2012-2021 period.

Welfare Integrity and Federal Pay: Also on Wednesday, the House considered three bills under Suspension of the Rules. The first, H.R. 3567, called the Welfare Integrity Now for Children and Families Act, prohibits TANF funds from being accessed at ATMs in strip clubs, liquor stores, and casinos. In California alone, almost $5 million of TANF benefits were withdrawn from casinos during the three and a half years from January 2007 to the middle of 2010. This provision is enforced by requiring states to report back to the Secretary that they are implementing the provisions of the legislation, or lose 5 percent of TANF funds. The House approved this bill 395-27. The second, H.R. 3835, extends the pay freeze for Members of Congress and federal employees through the end of 2013. This bill passed 309-117. The third, H.Res 496, cuts funding to Congressional committees by 6.4% for this year, except for Appropriations, Armed Services, and Ethics. This bill passed by voice vote.

Pro-Growth Budgeting: Thursday, the House passed H.R. 3582, the Pro-Growth Budgeting Act by a vote of 242-179. The bill requires the Congressional Budget Office (CBO) to prepare a supplemental estimate of the macroeconomic impact of any major bills reported by a House or Senate committee—what conservatives usually refer to as dynamic scoring. Under H.R. 3582, a “major bill” would be defined as legislation with any one-year estimated budgetary effect of more than one-fourth of one percent (0.25%) of the U.S. Gross Domestic Product (GDP) in that year. Once it is established that legislation is “major,” CBO would be required to dynamically score the legislation relative to a current policy baseline, which assumes that current tax policies are continued into the indefinite future, much like CBO's alternative fiscal scenario baseline. According to a Budget Committee report, CBO already has the necessary analytical tools and expertise to conduct dynamic scoring. CBO has occasionally provided such reports for certain legislation or policies, though currently this analysis is done on an ad hoc basis, or by request only. Implementing H.R. 3582 would cost about $2 million over the 2012-2017 period, assuming appropriation of the necessary amounts, according to CBO estimates.

Baseline Reform: Friday, the House approved H.R. 3578, the Baseline Reform Act by a vote of 235-177. The bill removes the automatic annual inflation adjustment from CBO’s discretionary baseline spending projections, thereby removing the automatic assumption that discretionary spending will increase each year. The bill requires CBO to project future discretionary spending “at the level provided for the budget year in full-year appropriations acts,” requiring CBO to use “zero baseline” budgeting for discretionary spending projections. According to a Budget Committee report, current law requires CBO and OMB to assume that discretionary federal spending will continue over the course of the ten-year budget window and increase at the rate of inflation. These requirements added approximately $1.4 trillion in outlays (over ten years) to the discretionary baseline in 2011. This assumption of additional spending in the baseline is a bias toward higher spending. Baseline budgeting also creates the ridiculous Washington scenario where a decrease in a spending increase—one that still allows spending to increase—is called a spending cut. This bill would remove that bias.

The week ahead – what are your thoughts on these bills?

Line-Item Veto:  Next week the House is expected to consider H.R. 3521, the Expedited Line-Item Veto and Rescissions Act. According to the Budget Committee, the bill would give the President an important tool to target unjustified spending, while also protecting Congress’ constitutional authority to make spending decisions. This authority would allow the President to specify spending provisions within an appropriations bill, while requiring stand-alone consideration of these rescission proposals by Congress. Legislation implementing the proposed spending cancellations would receive expedited floor consideration and an automatic up-or-down vote in both chambers of Congress. If this bill is enacted, every dollar of savings would be devoted to deficit reduction.

Budget Transparency — Also next week the House is expected to consider H.R. 3581, the Budget and Accounting Transparency Act. Among other things, the billwould formally bring Fannie Mae and Freddie Mac on-budget and require their debt issuance to be accounted for in the calculation of the federal debt; and would require fair value accounting for federal credit programs to appropriately evaluate the level of risk being absorbed by the taxpayers. The bill would also require fair value accounting for federal credit programs. The executive branch and Congress would be required to use “fair value” accounting in calculating the costs of federal credit programs that consider not only the borrowing costs of the Federal government, but also the costs of the market risk the Federal government is incurring by issuing a loan or loan guarantee. This reform would bring federal budgeting in line with private sector cost-estimating practices.

Civilian Property Realignment Act — Next week the House will likely consider H.R. 1734, the Civilian Property Realignment Act. H.R. 1734 is modeled after the Base Realignment and Closure (BRAC) process and would require an examination of federal real property across government, used and un-used, and make decisions based on the best return to the taxpayer. This cost-saving initiative would achieve a reduction in the size of the federal real property inventory through selling or redeveloping underutilized properties, increasing the utilization rates of existing properties, and expediting the disposal of surplus properties. For example, in fiscal year 2009, the federal government spent $1.7 billion in annual operating costs for under-utilized buildings and $134 million, annually, for excess buildings. According to CBO, the bill would save $600 million over five years.

STOCK Act—(THURSDAY, Feb. 9)  Also next week the House will likely consider a version of S. 2038, the Stop Trading on Congressional Knowledge Act of 2012. As drafted in the Senate, the bill would amend the Congressional Accountability Act of 1995 and the Ethics in Government Act to require the Senate and the House of Representatives to implement an electronic filing system for financial disclosure forms, as well as provide the public with on-line access to that information in a searchable database. The bill also would make clear that Members of Congress, Congressional employees, and federal employees are prohibited from using nonpublic information for personal financial benefit. In addition, the legislation would require more timely reporting of information about financial transactions by Members and staff. The Senate approved S. 2038 yesterday by a vote of 96-3.

**Remember though – this bill may not go far enough**

Senate

STOCK Act: The Senate passed the STOCK Act by a vote of 96-3 on Thursday. If so many of them voted for this bill now, why did it take them so long to figure out that they shouldn’t be trading stock based on information gleaned from their positions? Check out this link that goes over which amendments were accepted and which were rejected. Some of the rejected ones show us how much of a commitment to honesty these members really have (or don’t have).

Possible: Additional legislative items which are possible this work period include: FAA Conference report; Postal reform; Highway bill (current extension expires 3/31/12); and the Payroll Conference report (if completed before the recess).

So-called recess appointments: 40 Senate Republicans have said they will sign on to a court challenge to Obama’s so-called “recess” appointments to the Consumer Financial Protection Bureau and the National Labor Relations Board.

PASSION TO ACTION ADD-ON!

**When you call the Senate offices, urging them to repeal the CLASS Act, take one extra moment to ask them to join in the court challenge against President Obama’s unconstitutional appointments. You’ve already got them on the line, this will only cost you thirty seconds more, but you’ll make a big impact.**

Wednesday, February 1, 2012

The politics of who pays taxes

Why does Barack Obama play the politics of division on the income tax question? At the State of the Union Address Obama was at it again, quick to point out that “Warren Buffett pays a lower tax rate than his secretary.”

It’s not that hard to understand once one looks at the numbers. It’s less about who pays taxes, or how much they pay, than it is about who doesn’t. Most voting-age Americans do not pay income taxes — approximately 50.6 percent. That includes 53.91 million Americans who pay nothing in income taxes, and 64.7 million who get refunds in excess of what was owed. That’s 118.61 million out of 234.6 million Americans 18 years and older, based on data compiled by the Joint Committee on Taxation and the U.S. Census Bureau.


As a subset, the non-income taxpayers include 35.1 million who do pay payroll taxes but do not make enough or have enough deductions and credits that they do not have an income tax liability, based on data compiled by the Bureau of Labor Statistics showing 148.8 million Americans who have jobs full-time and part-time.

That leaves 116 million Americans who do pay income taxes, 49.4 percent of the voting-age population.

Further weighing the argument in his favor, when Obama talks about raising taxes on the upper-income brackets, he’s talking about just 3.9 million Americans who make $200,000 or more in Gross Adjusted Income according to the Internal Revenue Service. When he invokes the Buffett Rule, proposing raising capital gains taxes for those who earn more than $1 million, he’s only talking about 450,000 Americans.

That’s less than 2 percent of the voting-age population. And Obama’s betting that even if every single one of them voted against him, appealing to the 98 percent of voters whose tax rates would remain the same will help him get re-elected.

That is, if the tax rates of the wealthy become a front and center issue in the 2012 election. If they do, the political advantage will shift to Obama.

To disarm the Obama class warfare strategy, Republicans in 2012 will need to focus not on fairness in the tax code or over who pays taxes — which is to fight the battle on Obama’s terms — but to shine the spotlight on Obama’s lousy economic and fiscal record.

The fact is, the Obama economy has failed to create enough jobs to even keep pace with the growth of the population. Since Obama took office, the civilian labor force participation rate has dropped from 65.7 percent to just 64 percent, resulting in a loss of about 4 million people from being counted as unemployed even though they are of working age — because they’ve given up.

If those 4 million were included in the labor force, the effective unemployment rate would be closer to 11 percent, and the underemployed rate 17 percent, instead of 8.5 and 15.2 percent, respectively. Overall, there’s about 27 million working age adults who cannot find full-time work but would like to.

CONTINUED:
http://netrightdaily.com/2012/02/the-politics-of-who-pays-taxes/?utm_source=feedburner&utm_medium=email&utm_campaign=Feed%3A+NetrightDaily+%28NetRight+Daily%29

Thursday, January 26, 2012

14 Reasons Socialism Won’t Work in America

In Part Three of this series I explained the broad philosophical problem with socialism: its fundamental premise that state control is superior to individual liberty and economic freedom. In this installment I explain what adopting a socialist system would mean to Americans in practical terms. After completing this installment, the reader should be able to explain to young Americans why socialism is a flawed concept whether viewed as an economic system, a worldview, or in practical terms. Not only does socialism not work, it cannot work because of the following shortcomings:


•Replaces the family with the state as the central unit in society

•Undermines the family by redistributing its wealth and indoctrinating its children in government schools
•Allows legalized theft in the name of redistributing wealth
•Encourages sloth instead of productivity
•Rewards irresponsibility, laziness, and poor accountability
•Encourages self-indulgence instead of self-reliance
•Encourages finger pointing and shifting of responsibility to others
•Replaces the self-discipline of delayed gratification with the need for instant gratification
•Undermines the values that are the foundation of the traditional work ethic (i.e. thrift, diligence, self-reliance, self-discipline, responsibility, accountability, deferred gratification, and hard work) and replaces them with an entitlement mentality
•Treats those who contribute to the betterment of society the same as those who do not, even when they are capable of doing so
•Promotes a get-something-for-nothing mentality that undermines the moral character of the individual and society
•Robs people of initiative, drive, and ambition
•Undermines the spirit of entrepreneurship, innovation, and competitiveness
•Promotes totalitarianism, thereby undermining freedom and liberty

CONTINUED:http://patriotupdate.com/articles/14-reasons-socialism-wont-work-in-america

Monday, January 23, 2012

TPN—Alan Caruba: 35 Reasons Why Obama Will Lose in 2012

One could make a very long list of reasons why Barack Obama will lose in the November election. Here’s a short list why Obama has already worn out his welcome among the majority of Americans, including some of those who formerly supported him.


As Obama delivers his State of the Union speech on Tuesday, his theme will be “economic fairness”, but more net jobs have been lost on his watch (1,663,000) then any previous president going back to Harry Truman, none of whom presided over such an economic disaster.

1. Blamed all problems on George W. Bush, not the Democrats who had controlled both chambers of Congress since January 3, 2007 until 2010 when the Republicans gained control of the House.
2. Obamacare: challenged by 28 States as unconstitutional, subject of a Supreme Court hearing in March.
3. Supported passage of Cap-and-Trade carbon regulation legislation.
4. A strong advocate of “global warming”; revealed to be a hoax in 2009.
5. His failed multi-billion dollar “stimulus” program.
6. Admitted there were no “shovel-ready jobs.”
7. Mortgage refinance plan deemed a complete failure.
8. Appointment of White House policy “Czars”, one of whom was a Communist.
9. Failed foreign policy; Israel, Iran, North Korea, Iraq, Afghanistan, etc.
10. Mishandling of BP oil spill; slow to react, shut down all drilling in Gulf of Mexico.

CONTINUED:
http://www.teapartynation.com/profiles/blog/show?id=3355873%3ABlogPost%3A1801527&xgs=1&xg_source=msg_share_post

Sunday, January 1, 2012

WND: WHAT WERE THE MOST IGNORED STORIES OF 2011?

Here's what mainstream media did their best to cover up in 2011.

While the establishment news media brought plenty of bad economic news in 2011, the real story hasn't been adequately told. The true rate of unemployment and inflation and the real state of the U.S. economy, which is far worse than reported, tops WND's annual list of the 10 most "spiked" or underreported stories of the last year.  At the end of each year, many news organizations typically present their retrospective replays of what they consider to have been the top news stories of the previous 12 months.


WND’s editors, however, long have considered it more newsworthy to publicize the most underreported or unreported news events of the year – to shine a spotlight on those issues that the establishment media successfully “spiked.”

WND Editor and CEO Joseph Farah has sponsored “Operation Spike” every year since 1988, and since founding WND in May 1997, has continued the annual tradition.

Produced with the help of WND readers, here are the WND editors’ picks for the 10 most underreported or unreported stories of 2011:

1. The true rate of unemployment and inflation and the real state of the U.S. economy, which is far worse than reported.

When the Obama administration prepared to finance a 2011 budget deficit expected to top $1.6 trillion, the American public was largely unaware that the true negative net worth of the federal government reached $76.3 trillion last year.


The figure was five times the 2010 gross domestic product of the United States and exceeded the estimated gross domestic product for the world by approximately $14.4 trillion, according to economist John Williams.

Statistics compiled by Williams, based on the 2010 Financial Report of the United States Government, demonstrate the real 2010 federal budget deficit was $5.3 trillion, not the $1.3 trillion reported by the Congressional Budget Office.

The difference between the $1.3 trillion “official” 2010 federal budget deficit numbers and the $5.3 trillion budget deficit is that the official budget deficit is calculated on a cash basis, where all tax receipts, including Social Security tax receipts, are used to pay government liabilities as they occur.

“The government cannot raise taxes high enough to bring the budget into balance,” Williams said. “You could tax 100 percent of everyone’s income and 100 percent of corporate profits and the U.S. government would still be showing a federal budget deficit on a GAAP accounting basis.”

Meanwhile, the government’s own statistics showed in December that if the same number of people were seeking work today as in 2007, the jobless rate would be 11 percent.

While the Obama administration touted a November unemployment rate of 8 percent, much of it was a result of people leaving the labor force, not because they’ve become sick or too old, but because they have been unable to find a job and have stopped trying.

What’s more, the seasonally-adjusted rate adjusted for long-term discouraged workers – who were defined out of official existence in 1994 – was more than 22 percent in November.

The Bureau of Labor Statistics broadest measure of unemployment, which includes the short-term discouraged and other marginally attached works, along with part-time workers who can’t find full-time employment is more than 15 percent.

Methodological shifts in government reporting also have depressed reported inflation. If inflation were calculated the way it was in 1990, the annual rate would be nearly 7 percent.

2. The Justice Department’s “Fast and Furious” operation, which facilitated the delivery of American firearms into Mexico to violent drug cartels, later used in the murder of hundreds, including a U.S. Border Patrol agent.

The aim was to trace guns to the “big fish” in the cartel, but the practice of “gunwalking” put thousands of weapons on the street that have been used in hundreds of murders.

Two guns found at the scene of Border Patrol agent Brian Terry’s murder by cartel killers were traced to guns the ATF deliberately allowed to be sold to known cartel straw buyers in American gun shops in violation of federal gun laws. Justice Department records turned over to congressional investigators also showed Immigration and Customs Enforcement agent Jaime Zapata was gunned down by cartel killers using a pistol purchased by a straw buyer in Texas with cartel ties. ATF agents knew of the buyer’s cartel ties but did nothing to prevent the sale or the shipment of the gun to Mexico.

CBS News, the only establishment news agency to investigate the scandal, uncovered emails showing that Attorney General Eric Holder’s Justice Department has used the proliferation of cartel weapons to call for expanded gun control regulations.

In October, Holder lashed out at Congress members holding him accountable for the scandal, calling them “irresponsible” and guilty of “inflammatory rhetoric.”

In the letter, he claimed he first heard of “Fast and Furious” when Border Patrol agent Terry was assassinated in December 2010. But he had told Congress in May that he “became aware” of “Fast and Furious” only “a few weeks ago.”

Furthermore, the Justice Department released five censored memos from July and August 2010 addressed to Holder that referred to the program by name.

3. The organizations and money behind the supposedly “leaderless” Occupy Wall Street movement.

The Occupy movement was caught red-handed operating a nerve center staffed by professional agitators deeply tied to groups funded by billionaire activist George Soros.

The radical connections have been largely missed by the general public. CNN, the only news media outlet to receive exclusive access to Occupy’s alleged headquarters, did not fully identify the activists found running it.

Activist Han Shan, for example, is the former program director for the Tides Center-funded Ruckus Society and an activist with the Tides-funded Adbusters.

Shan was listed as the contact person for protests outside the 2000 Democratic National Convention that were sponsored by both Adbusters and Ruckus.

The Tides-funded Adbusters magazine is reported to have come up with the Occupy Wall Street idea after Arab Spring protests toppled governments in Egypt, Libya and Tunisia. The Adbusters website serves as a central hub for Occupy’s planning.

The Tides-funded Ruckus Society has been providing direct-action training to Occupy protesters as well as official training resources, including manuals, to Occupy training groups. Ruckus, which helped spark the 1999 World Trade Organization riots in Seattle, was also listed as a “friend and partner” of the Occupy Days of Action in October.

Another grantee of Tides is MoveOn.org, which has joined Occupy.

A public relations firm closely partnered with the Tides Foundation represented the anti-Wall Street march past millionaires’ homes in New York.

Fenton Communications has been behind the public relations strategy of a who’s who of far-left causes, organizations and activists, from Soros himself to Health Care for America Now to crafting strategies for MoveOn.org and a litany of anti-war groups.

The company was founded in 1982 by David Fenton, an activist who served as a photographer for Bill Ayers’ domestic Weather Underground terror group.

Fenton serves on the board of numerous Tides-funded groups, while his firm represents more than 30 Tides Center grantees.

4. The role of leftwing groups and the Obama administration in the fall of Arab regimes and the rise of Islamic radicals.


Billionaire activist George Soros has funded opposition organizations in Egypt and throughout the Middle East, where anti-regime chaos toppled the pro-Western leader of Tunisia and the rule of President Hosni Mubarak, a key U.S. ally, among others.

Mohamed ElBaradei, one of the main opposition leaders in Egypt, sat on the board of an international “crisis management” group alongside Soros and other personalities who champion dialogue with Hamas, a violent offshoot of the Muslim Brotherhood.

The Brotherhood, which seeks to spread Islam around the world by first creating an Islamic caliphate in Egypt, backed ElBaradei.

Soros leads an international “crisis management” group that long has petitioned for the Egyptian government to normalize ties with the Muslim Brotherhood. It released a report urging the Egyptian regime to allow the Brotherhood to establish an Islamist political party.

Soros’ Open Society also funded the main opposition voice in Tunisia, Radio Kalima, which championed the riots there that led to the ouster of President Zine El Abidine Ben Ali.

In September, Soros’ group was looking to expand its operations in Egypt by hiring a new project manager for its Egyptian Initiative for Personal Rights, which is run in partnership with the Open Society Justice Initiative. The group is seeking to develop a national network of legal empowerment actors for referral of public-interest law cases. Such organizations in the past have helped represent Muslim Brotherhood leaders seeking election or more authority in the country.

Soros himself made public statements in support of the protests in Egypt, which the Mubarak government warned would result in the rise of the Muslim Brotherhood in the country.

In a Washington Post editorial, ElBaradei recognized that if free elections were held in Egypt, “the Brotherhood is bound to emerge as a major political force, though it is far from assured of a majority.”

Soros singled out Israel as “the main stumbling block” in paving the way toward transition in the Middle East.

Egypt accused the Obama administration of championing the protests and of pressuring Mubarak to resign.

Months before protests erupted throughout Egypt, President Obama’s own associates provoked anti-regime chaos on the streets. WND reported at the time the protests were led by former Weather Underground terrorists Ayers and Dohrn.

Another protest leader was Jodie Evans, co-founder of Code Pink, a far-left activist organization formed in 2002 to protest America’s war in Iraq. The group previously met with Hamas and with leaders of the Taliban. Evans was a fundraiser and financial bundler for Obama’s presidential campaign.

Also protesting in Egypt was Ali Abunimah, co-founder of the anti-Israel Electronic Intifada website. WND previously reported Obama spoke at pro-Palestinian events in the 1990s alongside Abunimah. At one such event, a 1999 fundraiser for Palestinian “refugees,” Abunimah recalls introducing Obama on stage.

Ayers and Dohrn were two of the main founders of the Weather Underground, which bombed the New York City Police headquarters in 1970, the Capitol in 1971 and the Pentagon in 1972. The group was responsible for some 30 bombings aimed at destroying the defense and security infrastructures of the U.S.



CONTINUED:http://www.wnd.com/2011/12/382753/

Sunday, December 18, 2011

The Blaze: 50 Facts About The U.S. Economy That Will Shock You

December 18, 2011



“Even though most Americans have become very frustrated with this economy, the reality is that the vast majority of them still have no idea just how bad our economic decline has been or how much trouble we are going to be in if we don’t make dramatic changes immediately,” writes The Economic Collapse (TEC).


For those unfamiliar with this site, TEC is an economic blog that regularly compiles a comprehensive list of the most startling and unsettling facts about the U.S. economy.


Why? Because Americans need to understand that America’s economy is precariously balanced on the edge of full-blown collapse.


“If we do not educate the American people about how deathly ill the U.S. economy has become, then they will just keep falling for the same old lies that our politicians keep telling them. Just ‘tweaking’ things here and there is not going to fix this economy,” the site explains.


Indeed, America’s economic situation has become increasingly unstable. However, what’s arguably more disconcerting than the state of the U.S. economy is the fact many Americans are largely–if not completely–unaware of just how serious things have become.



“America is consuming far more wealth than it is producing and our debt is absolutely exploding,” TEC explains. “If we stay on this current path, an economic collapse is inevitable. Hopefully the crazy economic numbers from 2011 that I have included in this article will be shocking enough to wake some people up.”


It might behoove Blaze readers to share the facts listed below with family and friends.


“If we all work together, hopefully we can get millions of people to wake up and realize that ‘business as usual’ will result in a national economic apocalypse,” writes TEC.


Here are the 50 economic numbers from 2011 that will shock you (via The Economic Collapse):


1. A staggering 48 percent of all Americans are either considered to be “low income” or are living in poverty.


2. Approximately 57 percent of all children in the United States are living in homes that are either considered to be “low income” or impoverished.


3. If the number of Americans that “wanted jobs” was the same today as it was back in 2007, the “official” unemployment rate put out by the U.S. government would be up to 11 percent.


4. The average amount of time that a worker stays unemployed in the United States is now over 40 weeks.


5. One recent survey found that 77 percent of all U.S. small businesses do not plan to hire any more workers.


6. There are fewer payroll jobs in the United States today than there were back in 2000 even though we have added 30 million extra people to the population since then.


7. Since December 2007, median household income in the United States has declined by a total of 6.8 percent once you account for inflation.


8. According to the Bureau of Labor Statistics, 16.6 million Americans were self-employed back in December 2006. Today, that number has shrunk to 14.5 million.


CONTINUED: 
http://www.theblaze.com/stories/50-facts-about-the-u-s-economy-that-will-shock-you/

Monday, September 5, 2011

Sun Journal Letter to the Editor: CCTA Treasurer, Gary Lindsey

Bad future outlook, unless ...

9/3/11
I regularly attend the aldermen and county commissioners’ meetings and no matter which side of the political spectrum you are on, it is time to take the blinders off and question what they are telling us, especially from the national politicians about the state of our economy. Now instead of owing $14.3 trillion, we as a nation will owe $17 trillion in a few years. The accountant in me realizes that all the promises of giveaway programs they make to get reelected are not in the best interests of the working citizen.

With the global economic meltdown, we cannot trust the data released by the government officials. Per the current administration’s agenda that we all have economic equality, the reality is the standard of living will go down steeply and we will be closer to a banana republic status. Citizens, wake up. There is not enough money that can be printed, that retains its value, to support all the social programs established here in the USA. This is what the current administration will not tell you, because they do not think you can handle the truth. Please prepare for the worst. Buy extra food for long term storage and a way to provide yourself and family with clean water. And hope for the best, which will only happen when we elect better people to Congress.

Gary Lindsey
New Bern, NC

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Thursday, May 26, 2011

Looking for Medicare solutions, not politics as usual

The Miami Herald
Sen. Marco Rubio – Op-Ed
May 26, 2011

http://m.miamiherald.com/mh/db_42832/contentdetail.htm?contentguid=...

For me, Medicare is not a political talking point. My parents immigrated to the United States in the late 1950s. They worked hard for over 40 years to provide their children the chance to do all the things they themselves could not. But they never made much money.

As a result, they retired with precious little in savings. Medicare was and is the only way they could access healthcare.

When my father got sick, Medicare paid for his numerous hospital stays. And as he reached the end of life, Medicare allowed him to die with dignity by paying for his hospice care.

Like most 80-year-olds, my mother has several age-related ailments. Without the access to quality healthcare that Medicare pays for, I cannot imagine what life would be like for her.


America needs Medicare. We need it to continue without any benefit reductions for those like my mother currently in the system. And we need it to survive for my generation and my children’s generation.


But Medicare is going bankrupt. Anyone who says it is not is simply lying. And anyone who is in favor of doing nothing to deal with this fact is in favor of bankrupting it. Medicare will go broke in as little as nine years. No one likes this news, but it is the undeniable truth. And the sooner we begin to deal with it, the better off we are all going to be.

My goals are simple. First, I will not support any plan that changes Medicare for people like my mother who are currently on the plan. We cannot ask seniors to go out and get a job to pay for their healthcare.

Second, any solution must solve the problem. We need to save Medicare, not simply delay its bankruptcy.

And third, any solution cannot hurt economic growth. At a time of high unemployment, Americans cannot afford to pay more taxes.


I will support any serious plan that accomplishes these three things. It does not matter to me if it comes from a Democrat or a Republican. Saving Medicare is more important than partisan politics.

Rep. Paul Ryan has offered a plan that would make no changes whatsoever for anyone age 55 and older. I support it because, right now, it is the only plan out there that helps save Medicare. Democrats oppose it. Fine. But, if they have a better way to save Medicare, what are they waiting for to show us? What is their plan to save Medicare?

Either show us how Medicare survives without any changes or show us what changes you propose we make. Anyone who supports doing nothing is a supporter of bankrupting Medicare.

Where is the House Democrat plan to save Medicare?

Where is the Senate Democrat plan to save Medicare?

Where is President Obama’s plan to save Medicare?

They have no plan to save it, and they do not plan to offer one. They have decided that winning their next election is more important than saving Medicare for my mother and retirees like her.


I have been in the Senate just long enough to be disgusted by the reality that Washington has too many people who think their personal political careers are more important than our country’s future.

Maybe the Democrats’ strategy to use Medicare as a political weapon will work. Maybe not offering their own plan to save Medicare will help them win seats in Congress and re-elect President Barack Obama. Maybe it is great for the Democratic Party. But it is terrible for people like my mother, and it is terrible for America.

Medicare is going bankrupt. If something does not happen soon, in just a few years whoever is in charge in Washington will have to go to people like my mother and tell them we can no longer afford to continue providing her with the same Medicare she is used to.

We have always had intense partisan politics in America. But throughout our history, on issues of generational importance, our leaders have agreed to put aside politics for the sake of our country. Shouldn’t saving Medicare be that kind of issue?

I am ready to work with anyone in Washington who is serious about saving Medicare. I am open to any serious solutions they have.

We are running out of time to save Medicare for our parents and secure it for our children. If we fail, history will never forgive us.

SOURCE:  http://www.patriotactionnetwork.com/forum/topic/show?id=2600775%3ATopic%3A3964704&xgs=1&xg_source=msg_share_topic

Saturday, December 11, 2010

China #1, United States #2?

25 Facts That Prove The Transition Is Really Happening

On a recent episode of The Office, Michael Scott spent much of the show bemoaning the fact that China could soon become the number one economic superpower. Of course by the end of the episode everyone had concluded that the United States would continue to be number one indefinitely, but in the real world things are not so simple. Sadly, the cold, hard facts reveal that China is on the rise and the United States is experiencing a dramatic economic decline. The world is changing and China is projected to become the largest economy in the world at some point during the next decade. Americans have been taught from birth that "the U.S. is number one", but the transition is really happening. China is passing the United States even in quite a few high tech industries and in many areas of scientific research. The numbers that you are going to read below are absolutely staggering. It is getting really hard to deny that the Chinese are wiping the floor with us economically. In fact, they are beating us so badly that it is hard to put into words.


Of course our leaders are saying all the right things. During the State of the Union address last January, Barack Obama defiantly declared the following to the rest of the world....

"I do not accept second place for the United States of America."

Well, Barack Obama may not be willing to "accept" it, but that doesn't mean that it is not happening. China is becoming an absolute powerhouse. Of course that would never have happened if we had not opened up trade with them.

We have essentially merged our economy with China's over the past couple of decades. Now, if you walk into just about any store and start examining the products you will notice that far more of them are made in China than are made in the United States.

But most Americans still do not take China seriously. Most Americans still view China as being vastly inferior to the United States. Most Americans do not consider China to be an economic or a military threat at all.

Unfortunately, Americans have become so dumbed-down that only about 70 percent of them can even find China on a map.

The truth is that the world is radically changing. The truth is that China has become a world class rival of the United States. The truth is that the United States had better wake up fast if it wants to stay "number one".

The following are 25 facts that prove that China is rapidly becoming the number one economic superpower on the globe....

#1 Back in 1998, the United States had 25 percent of the world’s high-tech export market and China had just 10 percent. Ten years later, the United States had less than 15 percent and China's share had soared to 20 percent.

#2 The United States had been the leading consumer of energy on the globe for about 100 years, but this past summer China took over the number one spot.

#3 Nobel economist Robert W. Fogel of the University of Chicago is projecting that the Chinese economy will be three times larger than the U.S. economy by the year 2040 if current trends continue.

#4 Between 2000 and 2009, America's trade deficit with China skyrocketed nearly 300 percent.


#5 Over the past 15 years, China has moved up from 14th place to 2nd place in the world in published scientific research articles.

#6 Apple iPhones are manufactured in China by workers making about 293 dollars a month (and that was after a big raise).

#7 In 2009, the United States ranked dead last of the 40 nations examined by the Information Technology & Innovation Foundation when it came to "change" in "global innovation-based competitiveness" over the previous ten years.

#8 According to one recent study, China could become the global leader in patent filings by next year.

#9 Today, China controls over 90 percent of the total global supply of rare earth elements.

#10 According to a disturbing new study by the Economic Policy Institute, if the trade deficit with China continues to increase at its current rate, the U.S. economy will lose over half a million jobs this year alone.

#11 China is now the number one producer in the world of wind and solar power.

#12 The United States has lost a staggering 32 percent of its manufacturing jobs since the year 2000.

#13 Russia and China have announced that they have decided to quit using the U.S. dollar and instead start using their own national currencies when trading with each other.


#14 China now possesses the fastest supercomputer on the entire globe.

#15 In 2008, 1.2 billion cellphones were sold around the world. So how many of those cellphones were manufactured inside the United States? Zero.

#16 Today, the United States spends about $3.90 on Chinese goods for every $1 that China spends on goods from the United States.


#17 Now, close to half of all the graduate science students enrolled at colleges and universities in the United States are foreigners.


#18 China now has the world's fastest train and the world's biggest high-speed rail network.


#19 Manufacturing employment in the U.S. computer industry is actually lower in 2010 than it was in 1975.

#20 China is now the number one supplier of components that are critical to the operation of U.S. defense systems.


#21 Over the past several decades, China has been able to accumulate approximately $2.5 trillion in foreign currency reserves, and the U.S. government now owes them close to 900 billion dollars.

#22 Since 2001, over 42,000 U.S. factories have closed down for good.

#23 In 1985, the U.S. trade deficit with China was 6 million dollars for the entire year. In the month of August alone, the U.S. trade deficit with China was over 28 billion dollars.

#24 According to author Clyde Prestowitz, China's number one export to the U.S. is computer equipment.

#25 In 2010, the number one U.S. export to China is "scrap and trash".

So, in light of all of these statistics, is there anyone out there who still denies that the United States is in serious danger of being surpassed by China?

Sadly, the United States may not even hold on to the "number 2" spot for long. In fact, the economy of India is now projected to become larger than the U.S. economy by the year 2050.

Once upon a time, America was the most dominant economic power on the globe by such a margin that it was not even worth talking about who was in second place.

But those days are long gone.

Now we live in a nation that is rapidly becoming a post-industrial wasteland while the rest of the world catches up to us and passes us.

So is there any hope of turning all this around?

Is the decline of America inevitable?

http://beforeitsnews.com/story/298/654/China_1,_United_States_2_25_Facts_That_Prove_The_Transition_Is_Really_Happening.html

Friday, November 5, 2010

ObamaCare will decimate the economy

The Fed is about to print off another $500 billion-$1 trillion. The dollar will continue to collapse, and as a result, prices will continue to skyrocket--on EVERYTHING

http://www.examiner.com/conservative-in-national/obamacare-will-decimate-the-economy-1

Friday, September 24, 2010

DAVID HOGBERG, INVESTOR'S BUSINESS DAILY

America In Decline, Sowell Says, Citing Spending And Int'l Policy

By DAVID HOGBERG, INVESTOR'S BUSINESS DAILY

Posted 09/22/2010 07:17 PM ET

Early in his administration, President Reagan confidently asserted that "America's best days lie ahead." At the time it was true, but noted economist Thomas Sowell thinks it's no longer the case.

In his new book, "Dismantling America," Sowell argues that this nation is becoming one that many Americans no longer recognize as the country they grew up in or expected to pass on to their children and grandchildren. Rather, like Rome, America may be entering a prolonged period of decline.

Sowell sat down with IBD recently to discuss the political, social and economic forces that are leading to this decline and what, if anything, can reverse it.

IBD: What are the markers of national decline? What characteristics are different from a few decades ago that if they don't improve will lead to this country falling apart?

Sowell: One of the most serious current signs is the governing style of this administration, which is to impose as many things as possible on the public from the top down, without even letting them know what's going on.

Huge bills that fundamentally change the way the economy op erates have been rushed through Congress without hearings, without debate, and so fast that not even the members of Congress have a chance to read them. That's circumventing the notion of a constitutional government, and that's really at the heart of what the country is. The only analogy I can think of from history is when the Norman conquerors of England published their laws in French for an English-speaking nation. The utter arrogance — you're not even to know what the laws are until it is too late.

Reckless spending is another. The deficit and the national debt, as a percentage of GNP, is higher now than it was during any time except World War II. Moreover, once World War II was over we stopped the spending and started paying off the existing debt. We're going in exactly the opposite direction.

Of course, the one that trumps them all is on the international scene. That's where Iran is moving toward nuclear weapons. I'm just staggered at how little attention is being paid to that compared to frivolous things. If a nation with a record of sponsoring international terrorism gets nuclear weapons, that changes everything and it changes it forever.

Someday historians may wonder what were we thinking about when you look at the imbalance of power between the U.S. and Iran, and we sat there with folded hands and watched this happen, going through just enough motions at the United Nations to lull the public to sleep. That, I think, is the biggest threat.

IBD: Do you think the Israelis will take out Iran's nuclear program if they will be condemned by the "international community" and can't rely on backing from the Obama administration?

Sowell: If the choice is between condemnation or annihilation, I think they will go for condemnation. There may be reasons why it isn't feasible, but it's a tremendous choice to leave on them.

IBD: What has Obama done to hasten our decline?

Sowell: He has affronted our allies, but he's very clever about it. He's done it in ways that the general public is unlikely to notice. But it is in ways that people in other countries cannot mistake at all, such as the downgrading of the visits of the prime minister of Britain or Israel. At one time the visit of the prime minister of Great Britain meant a state dinner, a press conference and so on.

His first foreign policy gambit was to fly to Russia and offer to renege on the American commitment to put a missile shield in Eastern Europe, in hopes of getting Russian cooperation with the United States. All he really got out of that was a demonstration of his amateurishness and of his willingness to sell out allies in hopes of winning over enemies. That ploy was tried in the 1930s and didn't work all that well.

IBD: One big trend leading to America's decline that came through in the book was how politicians and activists use rhetoric.

Sowell: It's partly that, but it is also the education system has not taught people how to see through rhetoric. Somewhere Oliver Wendell Holmes says that the purpose of education is to create a mind that cannot be humbugged by words. Well, that is not the purpose of American education now. Much of the humbugging by words takes place inside the educational institutions themselves. Students are not generally taught to see both sides of an issue and learn how to analyze in such ways to see what the differences are and how you would sort it all out. Instead they're given one side and they're told that one side is it.

Schools all around the country have shown Al Gore's "An Inconvenient Truth." But I doubt that one-tenth of students have seen the British Channel 4 production called "The Great Global Warming Swindle."

IBD: So if children are taught only one side as unquestioned truth, what's the value of experience and wisdom?

Sowell: At one time students were taught, "You're young, you're inexperienced, you have a lot to learn. It's not up to you to make sweeping conclusions about society." Today that is not the message. Today when I see young kids, sometimes elementary students, carrying banners for some crusade, someone ought to tell them that you don't even know anything. Or you hear they are writing letters to the president on nuclear policy and so on. Within the past week, I got a letter from a high school senior who was about to inform me about economics in general and about the reason why there was a Great Depression and why it is necessary that Obama does the things he does. I didn't know whether to laugh or cry. But students are encouraged to think that way.

IBD: You note in your book that Americans take a lot of good things in this country for granted. How does that hasten our decline?

Sowell: You have to have a sense that freedom is always under siege, and not just by people who don't believe in freedom but by people who have their own agendas and either don't know or don't care that those agendas mean reducing other people's freedom. So if you don't have a sense of the danger from those sources, you're going to face a steady erosion of freedom, because people put their own agendas ahead of other people's freedom.

IBD: The "Vision of the Anointed" — the idea that there is an anointed elite qualified to run other people's lives — surely that must be playing a role in the dismantling of America.

Sowell: Oh, absolutely! And I think no one believes in that vision more so than Barack Obama, with the possible exception of Michelle Obama. They are the ones who know what we need. The very idea that anyone would take over someone else's medical care and think that it can be run from Washington by bureaucrats is just staggering. There needs to be a healthy fear of "making a difference" in areas where you have no expertise. Some years ago I was in a hotel, and the hotel clerk called me up and asked, "Is this Dr. Sowell?" I said yes. He said, "There is a pregnant woman downstairs in labor. Would you please come downstairs and help with the delivery?" I was absolutely appalled. That ought to be the reaction of most people when presented with an opportunity to "make a difference" in an area where they don't know what they are talking about.

IBD: How does the housing crisis embody some of the trends in the book?

Sowell: Everything that was done wrong in the past has been continued and escalated in the present. The recent so-called financial reform act left out Fannie Mae and Freddie Mac. It's like Hamlet without the Prince of Denmark. Fannie and Freddie are two institutions that are in the production and distribution of moral hazard.

Nothing will increase risk more than by shifting it to somebody else. If I thought the government would back me up, I'd go into the commodities market and put a million dollars into soybean futures. Knowing that the government is not going to back me up, I won't go within 100 miles of the commodities market.

Politicians know that politically it pays to have the taxpayers pick up the bill (as with Fannie and Freddie). People ask me sometimes, "Why do politicians keep making the same mistakes? Don't they ever learn?" And I reply, "They do learn! They learn they can get away with it. That's what they learn."

IBD: What is the "fallacy of fairness"?

Sowell: Most people would say that the government should treat everybody alike, judge them by the same standards, reward or punish them according to the same rules. That we can pretty much agree on.

But there is a more esoteric notion of fairness. Is it fair if one person is born into the world in circumstances that virtually guarantee their failure and others are born into circumstances that virtually guarantee their success? That kind of fairness is not social injustice, because society doesn't create it and society can't do much about it.

In my case I can see it pretty vividly. I'm one of those people who was separated from my siblings in infancy, grew up not knowing they existed and learned about them later on. We were all raised by poor people with very little education. But the family in which I was raised was determined that, although they had no education, I should have an education. I remember what a fuss was made when I was promoted to the seventh grade. I was taken aback by it and someone said to me, "You've now gone further than any of us."

Now contrast that with my younger brother raised down in North Carolina. One day, as a teenager, someone noticed he had on his Sunday clothes in the middle of the week. When asked why, he said he was graduating from high school that day. No one came to see him graduate or thought much of it, even though none of the people in his family had ever gone to high school. So he had to do it all on his own .

I had a sister who was also raised hundreds of miles away. And when she went to Dunbar High School in Washington, D.C., which was an elite school, there was resentment in her adoptive family. The reason was that the biological daughters in that family were nowhere near smart enough to go to that school.

Sociologists would come along and lump all three of these families together. But the kinds of things that matter are the things that politicians and bureaucrats can't do much about.

Now, you can create scholarships, tutoring programs and so on. But you have to recognize that the values that the kids have are the crucial things that will make or break them.

IBD: In your book you have two columns titled "Empathy Versus the Law," and you discuss the rule of law vs. the rule of lawyers and judges. Explain how that is leading to our decline.

Sowell: Empathy is one of the weasel words of our time. It is a prettier word than bias, but it means the same thing. Supreme Court Justice Sonia Sotomayor with those firefighters in Connecticut gave a free demonstration what empathy and bias mean. And yet not only was she confirmed; there were Republicans who announced going in that they were going to confirm her.

One of the things that happens is that people have no sense of what the law is supposed to be. It's not a matter of righting wrongs.

In the days of the French Revolution, "representatives on missions" were sent around the country to right wrongs. They had the power to overrule any laws or local officials. They carried their own guillotines with them. That notion of law, that's the direction those who are pushing judicial activism are going.

There was a time when we understood the judge's job is not to have empathy; his job is to carry out the law as written. And if it was a bad law it was up to the legislature to change it.

IBD: What do you think of the Tea Party movement? Could it reverse our decline?

Sowell: I'm sure it's one of the elements. I think one of the things more important than the Tea Parties is that so many people who were not political activists before have been spurred into action by the kind of things that have been done and the dangers they see. The biggest danger is not to see the danger. There are increasing numbers of people who see the danger. There are increasing numbers of people according to the polls who have no confidence in the media. I was delighted that Newsweek magazine is having so much trouble because they richly deserve it. There was one time I wondered who they were going to put on the cover once the Obamas were gone. So there are those signs, and as the great philosopher Yogi Berra said, "It's not over till it's over."



© 2010 Investor's Business Daily, Inc. All rights reserved. Investor's Business Daily, IBD and CAN SLIM and their corresponding logos are registered

Thursday, September 9, 2010

Obama says the economy needs a tax cut—and a tax increase.

THE WALL STREET JOURNAL:  Tax Contradictions

REVIEW & OUTLOOK-SEPTEMBER 9, 2010


After 20 months and more than $1 trillion down the Keynesian drain, President Obama is discovering the virtue of tax cuts. Pass the smelling salts, we just fainted.


Yesterday the President proposed a $180 billion plan that includes a permanent research and development tax credit and a tax write-off for all business capital purchases in 2011. These are both sensible ideas that would counteract at least some of the damage from Mr. Obama's looming tax increase. John McCain could sue for plagiarism because versions of both ideas were part of his 2008 campaign platform.

The White House will deny it, but it's important to understand what a conceptual switcheroo this is. Mr. Obama's economic policies to date have been based on the belief that government can drive growth by handing out checks to consumers, who will then spend the money and increase what economists call aggregate demand. Missing was any attempt to spur incentives for business or individuals to invest and take more risks. Even if this policy reversal is motivated by election desperation, it is still a tacit admission of the failure of its growth model.

The biggest short-term boost would come from allowing business expensing of capital purchases—investment in new plant, equipment, computers, technology and so on—in a single year. Such spending is currently written off over three to 20 years depending on the industry and an estimate of how long that the asset's value depreciates. But especially in our information age with its premium on human capital, it makes less sense to depreciate one type of investment at a faster rate than another.

Immediate expensing would provide a powerful incentive for businesses to spend some of that $2 trillion or so in retained earnings that they are now hoarding out of fear and uncertainty. Labor will also benefit because encouraging capital investment makes American workers more productive on the job, which is the catalyst for higher wages.


When President Bush allowed large and small businesses to write-off 50% of their capital expenditures as part of his 2003 tax cut, business spending on equipment and software rose to $1.06 trillion by the end of 2004 from $821 billion in mid-2002, a near 30% rise, according to tax economist Steve Entin. U.S. employment grew for 46 straight months, with almost eight million net new jobs created.

The big flaw in this proposal is that it's temporary. If the tax cut is for only one year, businesses will move spending forward that would have happened in future years. The economy will grow faster in 2011, other things being equal, but some of that growth will be stolen from 2012 and 2013. We've seen this temporary effect before with the home-buying tax credit, cash for clunkers and tax rebates.

In the Keynesian world-view, this is no problem because the one-year policy is supposed to kick-start the recovery and the stimulus can be safely withdrawn because the economy will become self-sustaining. But in the real world, investment will be greater and growth will be faster with a permanent reduction in the tax penalty on capital that will permanently increase the value of that capital. The White House still has some tax learning to do.

As for the research and development tax credit, it dates to the hugely successful 1981 Reagan tax cut. Year after year Congress has extended this tax credit, but only after the annual ritual of extracting campaign contributions from corporate America in return.

Making this tax credit permanent is good policy, and we almost hesitate to point out that George W. Bush endorsed this every year, lest Democrats in Congress recoil in horror. A 2010 study by the Information Technology and Innovation Foundation, a nonpartisan think tank, found that the U.S. ranks 17th among major economies in the generosity of its tax policy toward R&D.

Which takes us to the contradiction at the heart of Mr. Obama's partial tax epiphany: He wants to cut taxes on capital because he says the economy needs the stimulus, even as he wants to raise other taxes on capital that he says won't hurt growth. Huh?

Yesterday in Cleveland, Mr. Obama said he still wants tax rates to rise sharply in January on small business profits, dividends, capital gains and high-income earners. These are marginal rate tax increases on the very capital and R&D that his new tax cuts are supposed to nurture. And while the expensing tax breaks would be temporary, the tax increases would be permanent.

Another problem is that Mr. Obama says he wants to "pay for" the corporate tax cuts with a so far unspecified list of corporate tax "loophole closings," such as hammering the oil and gas industry. This is one reason the reaction in the business community has been so lukewarm to the new incentives.

We'll nonetheless give the President and his economic team points for intellectual progress. Their proposals for corporate tax cuts are a de facto recognition that the 35% U.S. corporate tax rate is too high. The recent report by Paul Volcker's White House economic advisory group also does a first-rate job of dissecting the high U.S. corporate tax as a barrier to growth. Mr. Obama is essentially proposing to eliminate the corporate tax for one year on new investment. But a better idea would be to slash the U.S. rate to the developed world norm in the mid-20% range, or lower. The lower the rate, the less need for tax credits and other loopholes.

The timing of these proposals will lead some to dismiss them as an election year conversion designed to stop a Democratic stampede to extend all of the Bush-era tax cuts. No doubt that's part of Mr. Obama's calculation, but they are also a concession to better economic policy.

Now that Mr. Obama has conceded that tax cuts are good policy, Republicans should see him—and raise.

Printed in The Wall Street Journal, page A16Copyright 2009 Dow Jones & Company, Inc.
All Rights Reserved

Tuesday, September 7, 2010

Campaign for Liberty

Reality Economics, By Lew Rockwell
September 7, 2010


As a culture, we like our reality on television, but seem to oppose it in economics.


For more than two years now, and even longer depending on your dating scheme, the federal government has waged war on the reality of the incredible Fed-fueled bubble that developed in housing with spillover effects on the rest of economic life.

That bubble had to explode to restore some sanity to the economic environment. There is no getting around that. The policies were all about trying to paper over what we did not want to deal with as facts. But the facts won't go away.

Do we have to make a television show to get Washington to see it?

The FDIC has admitted that some 829 banks remain at risk of failure. That's one in ten. Only 118 have failed this year but many more should have and would have absent Fed intervention. Meanwhile, there are no new banks started in the U.S. in the last quarter -- the first time in 38 years that this has been true. As for the actual soundness of the banks, it's anyone's guess. How much bad debt they are carrying, with both lenders and borrowers agreeing to look the other way, is something that no one wants to know.

Then there is the other topic that no one wants to talk about: house prices. They need to fall more. Washington has attempted to prop them up with some 18 different programs from mortgage buyouts to tax schemes. It delayed the fall of prices for a time. But they have begun to fall again, exactly to the point where nature wants to take them.

The problem is that you can't artificially boost both supply and demand at the same time. If you subsidize housing construction and that results in more houses being built, you apply downward pressure on the prices of houses that are currently on the market. If you subsidize house buying, you also promote house selling, allowing the reality of the real estate glut to express itself in home prices.

There is no way that the central planners can get around this problem unless they both build and buy houses themselves and leave the rest of us out of it. That might help prettify the housing data but it does nothing to change market realities. Merrill Lynch, in fact, has published a report that suggests that the housing glut will not normalize for another five years and that assumes some reasonable slowdown in the pace of building.

Already the government has done everything in its power to override market signals, at the same time it is attempting to make market signals operate in a way that conforms to political priorities. The problem is that you can't do both. You have to either defer to the market or abolish it.

The same is true with unemployment rates, which are stubbornly high. Now, what does it tell you when there is a surplus of workers relative to the number of job opportunities? It means that in some sectors, jobs are selling at too high a price. There are fixes for this. You can lower the minimum wage, reducing the cost of hiring, or workers can lower their reservation wage.

As it stands, Washington is doing nothing to encourage any of these fixes, so of course unemployment remains very high. Many young people have actually removed themselves from the market by going back to school to avoid paying their student loans. The state universities are glad to take their money.

A good indicator of future business conditions is commercial and industrial loans. They continue to fall as if off a cliff. How does the Fed deal with this? By keeping rates as low as possible on the short end, so that way banks have nothing to gain by lending and consumers have nothing to gain by saving. Not smart.

Meanwhile long-term rates are being held down by the existence of a too-big-to-fail doctrine for mortgage-holding companies like the nationalized Freddie Mac and Fannie Mae. In a real market, there is no telling where rates would be, but they would be high enough to compensate for risk. When there is no risk, or that risk is socialized, you see the absurd scenario of falling rates during the largest mortgage crisis in American history.

A major difference between now and the 1930s relates to the standard of living of consumers themselves. Everyone is still shopping, still living high on the hog, still going out to eat, still spending lavishly. But how and why? The answer is consumer credit, which is down but not nearly in proportion to the fall in economic prospects.

Such opportunities didn't exist in the 1930s. People had to live within their means. Today we can all just go on fooling ourselves for as long as possible.

Do we even want to raise the ghastly subject of government finance? Let's not go there.

Suffice it to say that the entire system today is shot through with artifice that just can't last. What are we to do about it? The present course is going to drive us further and further into disaster. The only real answer was stated by Ludwig von Mises in 1931, in an essay in the book The Causes of the Economic Crisis.

Mises wrote in 1931 as follows, and there is really nothing to add to his analysis:

"The severe convulsions of the economy are the inevitable result of policies which hamper market activity, the regulator of capitalistic production. If everything possible is done to prevent the market from fulfilling its function of bringing supply and demand into balance, it should come as no surprise that a serious disproportionality between supply and demand persists, that commodities remain unsold, factories stand idle, many millions are unemployed, destitution and misery are growing and that finally, in the wake of all these, destructive radicalism is rampant in politics.

"The periodically returning crises of cyclical changes in business conditions are the effect of attempts, undertaken repeatedly, to underbid the interest rates which develop on the unhampered market. These attempts to underbid unhampered market interest rates are made through the intervention of banking policy -- by credit expansion through the additional creation of uncovered notes and checking deposits -- in order to bring about a boom.

"The crisis under which we are now suffering is of this type, too. However, it goes beyond the typical business cycle depression, not only in scale but also in character -- because the interventions with market processes which evoked the crisis were not limited only to influencing the rate of interest. The interventions have directly affected wage rates and commodity prices, too....

"All attempts to emerge from the crisis by new interventionist measures are completely misguided. There is only one way out of the crisis: Forgo every attempt to prevent the impact of market prices on production. Give up the pursuit of policies which seek to establish interest rates, wage rates and commodity prices different from those the market indicates. This may contradict the prevailing view. It certainly is not popular. Today all governments and political parties have full confidence in interventionism and it is not likely that they will abandon their program. However, it is perhaps not too optimistic to assume that those governments and parties whose policies have led to this crisis will some day disappear from the stage and make way for men whose economic program leads, not to destruction and chaos, but to economic development and progress."




Copyright © 2010 by LewRockwell.com. Permission to reprint in whole or in part is gladly granted, provided full credit is given.

Friday, July 16, 2010

Demand for financing leads global economic recovery toward 'wall of debt'

Washington Post:  By Howard Schneider, Thursday, July 15, 2010
It has been dubbed the "wall of debt."

A massive wave of borrowing will start cresting this year when the U.S. and European governments sell an estimated $4 trillion in new bonds. The surge will course through the world financial system for several years as countries, corporations and banks borrow record amounts of money to repair the damage from the financial crisis and pay back loans from the boom that preceded it.


One crucial concern about the nascent economic recovery is whether markets can smoothly absorb that new debt, or whether it will force less-creditworthy governments into a Greek-style crisis, push weaker banks and corporations into default, and possibly trigger another downturn.

Analysts are split on the prospects. Large amounts of cash around the world and the expectation of continued low interest rates have some predicting a trouble-free outcome, while the sheer level of debt involved has others spooked about a destructive competition for credit. But that wall of debt has become a source of concern among economists at the International Monetary Fund and others who are trying to anticipate where the next crisis might arise.

"There will be a tightening of financial conditions," said Mohamed El-Erian, chief executive at bond-fund manager Pimco. He said his company expects that governments, corporations and leveraged buyout firms will all have to cope with stiffer requirements as they refinance maturing bonds, "some of which will not be refinanced on any terms."

Warnings are there

In a series of recent reports, the IMF questioned the ability of governments and banks to raise the money they need as both collide in the markets with multitrillion-dollar tabs -- a dynamic of supply and demand that could raise interest rates as those selling bonds bid up the rate they are willing to offer investors. That potential for high levels of government borrowing to raise rates or even displace corporate bond sales -- depriving companies of an important source of financing -- is a key reason for the agency's call on governments to trim deficits.

Ratings agencies such as Standard & Poor's already have begun warning of problems, particularly as bonds used to fund corporate takeovers during the boom years start to mature.


Standard & Poor's said some $1.7 trillion in bonds are due in the next three years or so among the non-financial companies it rates. Much of that debt is below-investment-grade junk bonds that pay a high interest rate but might be difficult to refinance in an economic climate wary of risk.

"Companies at the low end of the ratings scale may find it difficult to refinance at the rates they'll need for long-term survival, if they can find financing at all," Standard & Poor's wrote in a recent study.

The issue is affecting firms large and small. The ratings agency recently downgraded the Great Atlantic & Pacific Tea Co. over doubts about its ability to refinance $188 million in debt next year. It also cautioned about the prospects for the holding company of Texas energy giant TXU. The subject of the largest-ever leveraged buyout, TXU faces a $20 billion balloon payment in 2014 on $40 billion in outstanding bonds.

"The dollar amounts around the world that we are looking at are unprecedented," said Standard & Poor's Managing Director John J. Bilardello. "It was debt issued during the peak years [that] . . . originated in a fairly strong market" but is coming due in a much weaker one.

The IMF, for example, has estimated that banks will need to sell about $5 trillion in bonds in the next three years, particularly in Europe, where the agency said the need for long-term financing is "bearing down" on a sector overly reliant on short-term cash from central banks. That amount is an increase of $2 trillion -- 66 percent -- over the value of bonds sold by financial firms from 2007 to 2009, according to data provided by the Securities Industry and Financial Markets Association.

Between the money needed for its annual deficit and the refinancing of maturing debt, the U.S. government is expected to sell more than $2 trillion of bonds annually for at least the next two years -- about double its usual amount. Over the next six months, that will be part of what the IMF anticipates as a crush of government financing that includes Japan and heavily indebted countries in Europe.


The United States, as a classic safe-haven investment, has benefited from the current caution in the market, as investors plow money into U.S. Treasury securities and help keep interest rates at historic low levels.


Other countries don't enjoy the same confidence. According to the IMF, a handful of the economically weakest European countries, including large nations such as Spain and Italy, will need to sell some $360 billion in bonds during the rest of this year, at the same time stronger nations such as the United States are crowding the market with their own sales. Greece's large refinancing needs this year sparked its recent crisis -- and threatened a larger and potentially global financial seizure when the country appeared at risk of default. Although the European Union and the IMF have set up a fund to guard against a recurrence of that sort of problem, the actual mechanism has not been tested, and the IMF noted that interest rates had begun rising again for Spanish, Italian and some other European government debt.

Further ahead

Some analysts play down the risk, arguing that the low-interest-rate policy pursued by the U.S. Federal Reserve effectively pulls down rates across a variety of markets -- including for some corporate debt. Corporations and banks have comparatively large cash reserves, they note, and investors who shun equity markets may put money into well-rated corporate, government or financial bonds.

Even with the large amounts of government bonds to be sold, it was unlikely that the total demand for credit would outstrip supply by so much that interest rates are forced appreciably higher, said Larry Kantor, head of research for Barclay's Capital.

"I am not saying some borrowers won't be squeezed, but how it turns out will turn on a bunch other factors -- what the Fed is going to do, whether economic conditions become more favorable," Kantor said.


But it is the next few years -- not the next few months -- that the IMF is concerned about. Markets might cope with the current level of refinancing, but if economic growth rebounds -- if Europe recovers and its slower-growing nations start expanding -- then the private demand for financing will also increase. In its recent forecasts for the U.S. economy, the IMF even factored in a full percentage-point rise in Treasury rates -- an expensive proposition for the United States, in terms of its borrowing costs, and a sign that it expects credit markets to tighten.

"The concern comes more when we get to the point where private-sector demand picks up and there is true competition," said David Robinson, deputy director of the IMF's Western Hemisphere department. "Then there will be pressure . . . and it could be quite substantive."

http://www.washingtonpost.com/wp-dyn/content/article/2010/07/14/AR2010071402548_2.html?sid=ST2010071500171