Category Archives: Government Spending

Time for Some Economic Truth Telling

I have something to say to the politicians and the buffoons in the media. “Enough with the lies and the spin and the mis-information! The fraud you are perpetrating on the American people is (or should be) criminal.” For years now, we’ve been told that Reagan ran massive deficits unnecessarily; that Bill Clinton created a surplus; that the Bush tax cuts of 2003 caused the current debt crisis; and my least favorite, that all we need today is tax increases to get out of our current fiscal mess. Using the chart above, and in only 800 words, I will completely disprove each of these idiotic opinions. They are progressive myths perpetrated in an attempt to justify an ever larger U.S. government. So in order:

The deficits of the Reagan years aren’t pretty, but they pale in comparison to the sheer madness of today and more importantly, they had a purpose. When Mr. Reagan took office the Country was in a quagmire financially and militarily and the policies of his administration brought us out of both and to new heights never seen before in America. During his entire Presidency, Democrats held a death grip on Congress and its purse-strings. They could have stopped all that ‘horrible spending’ any time they wanted to – they didn’t. Trust me when I say, I hate deficits, but as deficits go, these had a usefulness at least. Things were accomplished. For the debt incurred, the country gained peace with its greatest-ever threat, the Soviet Union as well as new-found economic prosperity.

Bill Clinton is the luckiest President in U.S. history. He was a philanderer in the only moment in history when one might get away with it – that is after the country gave up its morals and before blogs, twitter, facebook etc. which might have led to a very different outcome (look at Anthony Weiner – his actions were nothing compared to Mr. Clinton’s and he was ridden out of town on a rail). On the financial front, he rode an economic boom driven by the internet to government financial nirvana and he and his progressive friends continue to take credit for something they had virtually nothing to do with. Look at the chart; it’s right there in red and blue. From 1984 to 2000 Federal revenue more than doubled. Tax cuts from the 80’s and the resulting economic crescendo capped by the tech-boom drove federal tax receipts through the roof. Did he pay down the debt? Nope. Instead, Washington spent more money than ever before in the nation’s history. Though they tried very hard, Mr. Clinton’s administration couldn’t spend it all and a small surplus was left over.

Along comes President Bush. He campaigns on returning the American people’s money (remember now, despite the progressives’ slight of hand tactics to make you forget this fact, it is our money)  to them via tax cuts. Coupled with the tech bubble bursting and 9/11, this leads to a drop in Federal revenue and a return to annual deficits. But, wait; look what happens next. Revenues explode upward starting in 2004 and reach the highest in our nation’s history in 2007. How can this be? I’ve been told repeatedly that the Bush tax cuts ruined this country. I’m sure it must be true; I mean, MSNBC says so. Sorry, liberals, wrong again. Mr. Bush is not blameless however. He presided over a federal spending bonanza that out-paced all the income gains created by the tax cuts. But, Progressives don’t argue against the ‘Bush spending’ however. That wouldn’t work with their agenda of always spending more; so they say the tax cuts are to blame. Think what they are actually saying – “We wanted to spend all the money we did spend, PLUS all the money Bush gave back in tax cuts”. Incredible!

Last lie, “Tax increases will get us out of this”. What?!?! The current tax code is virtually identical to that of 2007. That means we have a tax system in place today that produced the largest single year Federal revenue in American history. That isn’t enough for them? They need more? Look at the chart again. In the imaginary years to come, Mr. Obama is counting on Federal income reaching all new highs. And even if it does, he still expects to run $500 and $600 BILLION deficits EVERY YEAR!  He wants to increase taxes in the hopes of increasing revenue (despite all the evidence that it doesn’t work that way), not to get our budget balanced and pay down some debt. No, that would be far too sensible for Washington. These morons want to increase spending even more. They want to go to all-new record levels of spending. I guess they’ve never heard of the idea of cutting back when times are tough.

There you have it; four lies of the left debunked. Where does that leave us? I’ll leave that for another time, but there are some lessons here for those willing to see. How does 2007 revenues with 1999’s spending sound? The result is a $900 billion annual surplus. $450 billion per year of that could go to debt reduction and $450 billion to replacing the money Washington has robbed from Social Security. That sounds like a good place to start.

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22 Million Americans Work for Government!

22,500,000 of our fellow countrymen work for the government, ie. the taxpayers. That’s more than work in construction, farming, fishing, forestry, manufacturing, mining and utilities combined! And, it’s 3 times as many government employees as there were 50 years ago.

How can a system sustain itself that keeps expanding the public sector work force?  Don’t think too hard, it’s a rhetorical question – IT CAN’T! But here’s an even scarier thought… What if these folks were allowed to form unions and collectively bargain, ie. hold the rest of us over a barrel? Thank goodness we aren’t stupid enough to allow that. Oh, wait…

 

Link to full story in Wall Street Journal

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Representation Without Taxation Doesn’t Work Either

Today being tax day, it seems a good time to remind ourselves of some key figures. Most Americans give at least a cursory look at their household budget monthly as they pay their bills or perhaps weekly if they’re in the tough position of living paycheck-to-paycheck. But, few stop to review their country’s financial state even once a year. Perhaps that should become a tradition on tax day. After all, Americans would call their cell phone provider and dispute a $10 unexplained charge; so why do they continue to pay thousands each year without asking why or where it’s going?

So here it is, the federal budget for the next ten years, as laid out by President Obama. Be sure to note, it is displayed in billions of dollars.

Allow me to round some figures off in summation: This year, the federal government will take in $2.2 trillion while spending $3.7 trillion (a $1.5 trillion deficit on top of the existing $11 trillion federal debt). Notice they expect the best year in the next ten, 2014, to still be a net loss of $706 billion, even if some wild optimism on Washington’s part comes to fruition.

This is the equivalent of an American family that earns $100,000 per year spending $168,000 while carrying $600,000 in debt; writing IOUs for the $68,000, and planning to do the same thing each of the next ten years and beyond. None of us would do that, so I can’t believe there’s a person in this country dumb enough to think the government’s numbers work, but there is. In fact, there are millions of them. A few of these work in the Lame Stream Media and will go on TV tonight and deride their fellow citizens who are at rallies all over the country today protesting this very spending lunacy, even though it seems the protesters are the only ones paying attention.

But how can millions of people who think the government’s budgetary suicide is ok? Well, that’s easy – 47% of all Americans pay NO FEDERAL INCOME TAX! Put simply, these people have no skin in the game. They are too short-sighted to realize that at the very least, their kids might some day have to pay this bill; or much worse, that a financial default by this country will mean financial pain for all – especially those who currently live off the taxpayer’s largess. Still, come election day, they have the same voting power as those footing the bill, and therein lies the problem. As Ben Franklin so accurately said, “When the people find that they can vote themselves money, that will herald the end of the republic.”

Taxation without representation was cause for a Declaration and War of Independence. Turns out representation without taxation doesn’t work so well either.

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Isn’t It Ironic?

Oh the irony! In the same week that Democrats cram through their Health Care takeover legislation, yet another government entity admits it is losing money hand-over-fist and has no idea how to stem the tide of red ink. Postmaster General John Potter admitted to the Senate committee responsible for oversight of the Post Office that they are expecting to lose $238 billion over the next ten years.

Mr. Potter wants to eliminate Saturday delivery to save $3 billion a year, but the Senators don’t like that idea. He discussed the need to cut some of the 36,500 post offices around the country (more locations than McDonald’s or Starbucks), many of which see far too little traffic to be financially justified. The Senators weren’t crazy about that idea  either. He pointed out that his organization is heavily burdened by far too many employees with benefits that are far too generous including retirement plans that exist nowhere other than in government jobs. Shockingly the Senators weren’t keen on the idea of reducing the bloated USPS workforce either. In other words, Mr. Potter was arguing that the Post Office needs to be allowed to run like a private company – as a matter of fact, he said exactly that.

If the Postal Service were provided with the flexibilities used by businesses in the marketplace to streamline their operations and reduce costs, we would become a more efficient and effective organization. Such a change would also allow us to more quickly adapt to meet the evolving needs, demands, and activities of our customers, now and in the future.

So, in the same week that Democrats took a giant step towards their end-goal of a government run U.S. health care industry, the Postmaster General went to the Senate and admitted that the government can’t even manage to effectively run the Post Office. What do you think, is it harder to deliver the mail or heal the sick?

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More Debt Anyone?

The federal debt limit is going up faster than my credit limit with Visa during the economic boom of the last decade. The difference being, just because Visa kept upping my limit, didn’t mean I was stupid enough to spend it! But Washington is. Yesterday Senate Democrats voted yet again to raise the federal debt limit – this time by $1.9 Trillion to a staggering $14.3 Trillion. That’s up from the previous limit of $12.4 Trillion which they’ve borrowed and spent all of. That’s right, your elected representatives have maxed out your country’s credit cards again and they’re back for more. Does anyone else find it incongruous that few if any Americans would put up with their teenager running up a big cell phone bill or a few hundred dollars in credit card debt, but these same Americans have no problem with their employees in Washington borrowing trillions in our name without the slightest inclination as to how to pay it back?

In this case, one might be tempted to ask ‘Why so much of an increase at one time’? The answer is simple – it’s politics, of course. You see, the government is on track, according to the CBO, to run another $1.4 Trillion in the red this year, matching 2009’s record setting deficit (that’s a record that was TRIPLE the previous high mark by the way). With this in mind, the Democrats wanted to raise the debt limit enough to prevent another such vote prior to November’s elections. They don’t want to have to bring you the credit card bill a month before asking for your vote. Quick math says they’ve given themselves a $500 billion margin for error. I wonder if that will be enough?

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Why Trifle Over a Measly $2 Trillion

On February 26, 2009, the Obama Administration released it’s first budget projecting a net deficit over the next 10 years of $7.1 trillion. The Congressional Budget Office scored the budget and said, no, the deficit would be $9.1 trillion over that 10 year period. The administration didn’t like that number and insisted it was wrong. Forget that the CBO is a non-partisan organization whose entire reason for existing is to answer such questions, that number was just too high and the administration didn’t want to admit to saddling the country with that kind of debt. chart_budget3

I’m not sure why they were worried about that, their friends and non-journalists in the main stream media published this chart without so much as mentioning that not one single year was projected to be in the black. Nor did they mention that this preposterous level of spending didn’t even include the additional $1 trillion that Obama’s team projects universal health care will cost (again, the real economists say that number is more likely to be $2 trillion).

This week, in a shocking development that absolutely everyone saw coming, the administration admitted that yes, the real deficit number will be exactly what the CBO said it would be – $9.1 trillion! And this number still doesn’t include the costs of a universal health care program. Nobody seemed to care very much, certainly not Obama’s campaign publicists, aka the main stream media.

Some may ask why I would trifle over a measly $2 trillion. After all, what’s another couple trillion dollars at this point. We are drowning in these mind-boggling large numbers that are beyond comprehension for most Americans. And that’s exactly what the policy makers count on. And that is why it should matter to all Americans. It should matter that our government is spending like a group of drunken sailors on shore leave and expecting you and I to pick up the tab. Actually, that’s not true, were we able to give the politicians a truth serum, they would tell us they have absolutely no idea how to pay for this. Yet, they keep spending, and America keeps letting them.

$9.1 trillion over the next 10 years will mean a federal debt of more than TWENTY TRILLION DOLLARS by 2019 and that’s if the politicians are able to control themselves and stick to a budget – a laughably unlikely proposition if ever there were one. Maybe it is time to trifle.

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Congress Again Plays Robin Hood

Once again Congress is bribing some Americans using money stolen (okay taxed, but what’s the difference?) from other Americans. Democrats have decided they know best what cars their fellow citizens should be driving and want to manipulate the people’s behavior in their chosen direction. [On a side note, where is manipulate in the Constitution? I can’t find it.] Tuesday the House voted to provide $4 billion so that anyone who turns in a gas guzzler and buys a new car can get a $4500 rebate from Uncle Sam.

First, Democrats ripped off the shareholders and debt holders of GM and seized 83% ownership of General Motors using money they stole from the American taxpayer (well, actually the American taxpayer’s grandchildren, but that’s  another story) and now their trying to rescue our $50 billion they poured into a dead company by ‘stimulating’ GM’s sales with more stolen funds.

But the greatest travesty here is the injustice of these kinds of measures. If your neighbor buys a new car or truck this year and the new vehicle gets 10 mpg better than their previous one, they get $4500 of your money and mine toward the purchase, no other strings attached. If the new auto gets just 4-9 mpg better than the old one they still get $3500 from our crazy Uncle Sam. Many Americans (estimates are around 9 million) were already going to buy a car this year and will now get a nice bonus courtesy of their fellow Americans for doing something they were already going to do. The hope is that this legislation will generate more sales, but how many more and will those additional sales be worth it?

Who loses in the end? The same taxpaying citizens who always lose. Those who listened to the politicians, the talking heads, or more likely, their own common sense and got out of gas guzzling autos  in the last few years will once again be paying extra taxes so that others, who did not make good choices, can get a $4500 gift. Yet another example of Congress stealing from some and giving to others. Does no one see the injustice of a government behaving this way?

House passes cash for clunkers to boost new car sales – Jun. 9, 2009.

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Terrorists Get All Expenses Paid Trip to Pacific Island

At a time when many Americans can’t afford the basics such as food or the mortgage let alone a luxury like an island vacation, the Obama administration is paying $200 million to send 17 Muslim detainees on a luxurious Pacific island get away. OK, not exactly, but the truth is not any better. In truth, , in its determination to close the detainee facility at Gauntanamo the Administration will be providing Palau with $200 milllion in aid (those are your tax dollars folks), and in exchange, Palau will take in the 17 Chinese Muslim detainees and allow them to take up residence on the islands. They will be free men, subject to periodic review by the Palau government. Washington Times Article

Meanwhile, the Chinese government considers these individuals criminals and wants them extradited back to their native land. Sending them back to China where they belong would be free for the U.S. taxpayer, but the Obama administration fears they may not be treated fairly by the Chinese government, and thus arranged this alternative plan. So, we have interfered in how China deals with its own people and spent another $200 million of the American tax payer’s hard-earned money to do it. $200 million this government will have to borrow of course due to this year’s record $1.8 TRILLION deficit.

This follows on the heels of reports that the Administration has also begun Mirandizing foreign fighters captured in the war on terror. Coming soon to a court room near you will be suspected terrorists hiding behind Constitutional protections designed for and promised only to American citizens. Interestingly, just a couple months ago, President Obama laughed this idea off saying it was, “ridiculous”!

Apparently, it wasn’t so ridiculous.

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Eight Quarters, a Dime and Four Pennies

With much fanfare today, President Obama asked his Cabinet to dig deep into their individual budgets and come up with savings of $100,000,000 from the federal budget. Finally, Washington is going to stop the madness; finally there is some fiscal discipline coming from our leadership. Or is there?

You see, 100 Million Dollars, while a big number to almost any American, is just .00286% of the President’s budget for the coming year. Since a percentage that small is almost incomprehensible, let’s try to put it in perspective. For someone earning $75,000 a year, this is the equivalent of saving $2.14. No, you don’t need to check my math, it’s correct. This much hyped effort is roughly the same thing as you or I skipping tomorrow morning’s coffee. Now don’t misunderstand, restraint in Washington is always a positive and to be encouraged. But, it is wholly disingenuous to hold a press conference and announce your “ambitious plans” to save a cup of coffee.

This is so obvious that even Obama’s fan club (oops, that should read – the White House press corps) caught on as you can see in the first two minutes of this hilarious video. As these reporters correctly point out, the White House scoffed at Republicans just a few weeks ago when they suggested that billions in earmarks were frivolous in light of the country’s financial situation.  In Obamaland billions are small meaningless numbers we shouldn’t worry about, and millions are huge savings to call a press conference and pat yourself on the back about – NO WONDER WE’RE IN THIS MESS!!!!!!

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You Can Not Make This Stuff Up!

In the latest sign that the apocalypse is upon us the United States government is now providing free cell phones to people on welfare. I AM NOT KIDDING! Apparently a monthly check, free medical insurance, free or subsidized housing and food stamps is not enough.  No, now the American taxpayer is being forced to pay for free cell phones and free monthly minutes for qualifying welfare recipients. Since no rational person would believe this, here is some information from the site:

Lifeline Assistance is part of a program that was created by the government to provide discounted or free telephone service to income-eligible consumers. To help bring you this important benefit, SafeLink Wireless is proud to offer Lifeline Service. Through our Lifeline Service you will receive FREE cellular service, a FREE cell phone, and FREE Minutes every month! SafeLink Wireless Service does not cost anything – there are no contracts, no recurring fees and no monthly charges.

Any Minutes you do not use will roll-over. Features such as caller ID, call waiting and voicemail are all also included with your service. If you need additional Minutes, you can buy TracFone Airtime Cards at any TracFone retailer Walmart, Walgreens, Family Dollar, etc). SafeLink Airtime Cards will be available soon.

Your exact benefits, including the number of free Minutes you will receive, depend on the state you live in. Please enter your ZIP code to get the details for your state.

My favorite part is the free roll-over minutes.  My carrier doesn’t offer that benefit and my wife and I pay more than $200 per month!

No one is going to argue that those on welfare are living in the lap of luxury, and certainly some people genuinely need assistance for a period of time to stabilize their lives, but this takes all Common Sense and tosses it out the window. The U.S. is more than 11 Trillion Dollars in debt and has decided that giving out free cell phones is a good use of the money it doesn’t have. Well, at least everyone will be able to communicate as the Country spins down the drain.

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