And So I Go: Yesterday, Today and Tomorrow

Archive for the ‘Deficit Reduction Proposal’ Category

The budgets  from the Republican House (Ryan budget),  the Democrats in the Senate and Obama won’t pass so the country will again for the fourth year continue to operate on “continuing resolutions”.  The law of the country requires that Congress pass a budget but for 4 years the Senate has refused to even offer up a budget let alone pass the one offered by either the President (NOT ONE VOTE FOR ANT OBAMA BUDGET EVEN FROM A DEMOCRAT!) or the budget offered by and passed by the Republicans in the House.

Sooooo, here we have the Senate Democrats  “continuing resolution” and if all the tears hadn’t been rung out of me in November when We the People re-elected Obama to the Presidency then I would probably find myself crying again. Surely not all of these people are evil and certainly they are not all stupid, so what in the world is happening in the Democrat Senators minds?!?

The following article from The Heritage Foundation explains  very well some of the more egregious  proposed spending.  I hope when you read this you get on the hone to your Congressman or woman be he/she Democrat or Republican and demand some sanity in Washington.  BB

Heritage Experts’ Reaction to Senate Continuing Resolution

Todd Thurman

March 12, 2013 at 5:40 pm

Newscom

The massive spending bill, or continuing resolution, released by the Senate this week continues spending on programs which are inappropriate or wasteful and fails to adopt good policies in many areas. Here’s a rundown of some of the worst offenders in the Senate bill:

Obamacare. The CR fails to stop the massive spending in Obamacare. Obamacare obligates an estimated $1.2 trillion for subsidies to individuals for purchasing coverage through the government exchanges and $638 billion for states agreeing to expand their Medicaid programs. Congress should eliminate the exchange subsidies and the enhanced federal match for the Medicaid expansion. Stopping these provisions would save the federal government more than $1.8 trillion over the next 10 years. Nor does it take steps to defund implementation of Obamacare.

 (Already the regulations governing how Obamacare is implemented is 7 feet tall and only about 1/40 of the bill is covered by these regulations.  Just the application to qualify for Obamacare is 15 pages long!  BB)

—Nina Owcharenko, Director, Center for Health Policy Studies and Preston A. Wells, Jr. Fellow

Inadequate Defense Funding Levels. The detailed defense appropriations provisions in the House-adopted appropriations bill (H.R. 933), and now its Senate companion legislation, provide inadequate overall funding levels for defense, in part because they will continue to apply the reduction in defense spending for the current fiscal year required by sequestration. Nevertheless, the defense provisions continue wasteful spending practices. These defense appropriations provisions were agreed to by House and Senate appropriators earlier, and therefore the wasteful practices were also preserved in the Senate version of the same legislation.

The Heritage Foundation has identified at least $70 billion in annual savings within the Department of Defense through a combination of military health care and retirement reform, hiring freezes, expanding performance-based logistics, and reforming the acquisition process.

Clearly, this is money that could be kept within the defense budget and put into more militarily useful programs, such as improving space technology for use in missile defense or developing new classes of nuclear weapons delivery systems. The more productive approach to funding an effective military posture for the U.S. would be for Congress to return to the regular budgetary order, set aside sequestration, adopt higher defense appropriations that are applied in a more disciplined fashion and look to restrain federal spending growth in the areas of foreign aid, domestic discretionary programs, and entitlements.

(The world has never been so dangerous as it is today.  Iran is on the verge of getting nuclear weapons and working very aggressively on their missile delivery program.  North Korea already has nuclear weapons and now may very well have a missile able to hit the West Coast.  So what does the President and the Democrats want to do?  cut our defense programs!  BB)

—Baker Spring, F.M. Kirby Research Fellow in National Security Policy

Head Start. Increasing Head Start funding is the antithesis of good early childhood education policy. The Senate CR provides $33.5 million in new funding for one of the most ineffective federal education programs in existence today: Head Start. While the new funding is earmarked for the Obama Administration’s plan to make the worst-performing Head Start centers re-compete for funds, it represents new spending on a program the federal government has deemed totally ineffective at meeting the needs of poor children.

In December, the Department of Health and Human Services (HHS) released itslong-overdue evaluation of Head Start. The agency’s scientifically rigorous evaluation of more than 5,000 Head Start children from the time they entered the program through third grade revealed that the $8 billion per year federal program had little to no impact on cognitive, social-emotional, health, or parenting practices of participants. On a few measures, access to Head Start had negative effects on children.

In addition to the evidence presented by HHS of Head Start’s ineffectiveness, in 2010 the Government Accountability Office (GAO) reported widespread fraud at Head Start centers. GAO sent undercover investigators into Head Start centers in various states, and in half they found fraudulent activity, such as Head Start employees counseling families to underreport their income in order to appear eligible for services.

Since 1965, taxpayers have expended some $180 billion on Head Start yet have not received a return on that “investment.” And now, in the wake of an objective report by HHS demonstrating that Head Start is failing the poor children it was designed to serve, the Senate CR would increase spending and eschew any suggestion of eliminating or reforming the Great Society relic.

Head Start should be eliminated. At a minimum, it should be reformed to allow states to make their Head Start dollars portable, following low-income children to a private preschool provider of choice, instead of relegating them to underperforming Head Start centers.

—Lindsey Burke, Will Skillman Fellow in Education

Energy. The Senate CR continues to fund a failed energy policy that empowers Washington bureaucrats instead of American families and businesses. Though it does cut some programs minimally, it does the equivalent of removing a used napkin from a full trash can. There’s much more waste that needs to be removed. For example, section 1203 reduces Department of Energy (DOE) funding by $44 million when more than $5.3 billion could be cut. The $44 million is equivalent to 0.8 percent of what should be cut.

Perhaps most egregious is the meager $11 million cut from the $1.8 billion request for Office of Energy Efficiency and Renewable Energy. In total, the DOE budget funds applied-research programs on conventional fuels, renewable energy sources, and nuclear energy that the private sector should be undertaking. American families and business are far better equipped than government to determine what types of energy technologies work for them. Eliminating these programs alone would save $3 billion in taxpayer money and help to return energy choice back to Americans.

Though the bill cuts $10 million from nuclear energy spending, based on the 2013 request, it would still fund over $150 million for nuclear waste disposal and management programs. None of this funding would go toward Yucca Mountain, the waste repository mandated by the Nuclear Waste Policy Act, as amended. Given the complete lack of any nuclear waste disposal or management policy by the Administration and its insistence on terminating the Yucca project, there is little justification for this spending. Instead, Congress should provide $40 million for the Nuclear Regulatory Commission to finish its review of the DOE’s Yucca Mountain permit application.

(The United States sits on the largest pool of   CLEAN natural gas in the world and we have the means to get to this energy source but it does not fall into the category of solar, wind or water.  natural gas is a fossil fuel!  BAD!!!  The United States also has the largest pool of oil available within our borders.  Obama likes to say that we are pumping more oil today than at any time in our history.  this is true but it is BEING PUMPED OFF OF PRIVATE PROPERTY AND NOT FROM GOVERNMENT OWNED LANDS.  AND THE GOVERNMENT IS BUYING UP PROPERTY LIKE NEVER BEFORE TO PUT MORE LAND UNDER IT’S CONTROL!   bb)

—Jack Spencer, Senior Research Fellow, Nuclear Energy, and Nick Loris, Herbert and Joyce Morgan Fellow

Consumer Product Safety Commission (CPSC). Unlike the budget passed by the House, the Senate bill seeks to restore government spending to fund the failed CPSC product safety database. CPSC decision making with respect to the database has previously been called “arbitrary and capricious” by the courts.

Since it was implemented in 2011, manufacturers have shown that the CPSC database is seriously flawed. The database allows the public to submit unproven claims of harm with the CPSC and gives manufacturers only 10 days to challenge these claims; however, the CPSC itself has final authority to publish reports of such claims, even if they are disproved by the manufacturer. The accuracy of the CPSC reports is thus seriously questionable, and is a one-stop shop for tort lawyers seeking new clients or seeking “evidence” for their current lawsuits.

Furthermore, last October, in Company Doe v. Inez Tenenbaum, a federal court in Maryland overturned a decision of the CPSC to publish a report as “arbitrary and capricious,” because the CPSC report was “misleading and fail[ed] to relate[] to the [manufacturer’s] product in any way.” Indeed, the CPSC database is a concrete example of government waste: It is a shame that the Senate bill seeks to restore government spending to publishing misleading claims that damage business growth and likely lead to additional frivolous lawsuits.

 

(What this means for you and me is that companies will refuse to put new products on the market that may save a life!  BB)

—Andrew Kloster, Legal Fellow

Supplemental Nutrition Assistance Program (SNAP): $77.2 billion. The recommendation continues record-high food stamp benefits. Food stamp spending has approximately doubled since President Obama came to office. It is one of the largest and fastest growing federal welfare programs. The federal government operates 80 federal welfare programs at a cost of nearly $1 trillion a year. Over 10 of these provide food assistance.

Food stamp spending should be rolled back to pre-recession levels. Able-bodied adults without dependents who receive food stamp benefits should be required to work or prepare for work as a condition of receiving benefits.

—Rachel Sheffield, Research Associate

Job Corps: $30 million added to the funding level already provided under sequestration. This program should be terminated, because a scientifically rigorous impact evaluation of Job Corps participants were less likely to obtain high school degrees, were no more likely to attend or complete college, and earned only $0.22 more in hourly wages than non-participants. Further, the Department of Labor Office of Inspector General estimates each Job Corps participant who is successfully placed into any job costs taxpayers $76,574.  (Why don’t we just give every one who applies for one of these job training programs $20,000.  and send them home to sit on their asses for another 6 months?  This would be a whole lot cheaper in the long run!  BB)

Violence Against Women Act (VAWA) grants: $416.5 million. VAWA grantsshould be terminated, because these services should be funded locally. Using federal agencies to fund the routine operations of domestic violence programs that state and local governments could provide is a misuse of federal resources and a distraction from concerns that are truly the province of the federal government.

(This one just makes me cringe and cry and be sick!  BB)

Office of Justice Programs (OJP) grants: $1.1 billion. OJP grants should be terminated, because these grants assign functions to the federal government that fall within the expertise, jurisdiction, and constitutional responsibilities of state and local governments. Further, the Edward Byrne Memorial Justice Assistance Grants ($392 million) within OJP have been used to place criminals on the street without posting bail.

Office of Juvenile Justice and Delinquency Prevention (OJJDP): $279.5 million. OJJDP grants should be terminated, because these grants fund juvenile justice and prevention programs that fall under the unique responsibilities of state and local governments. Further, there is little evidence that these grants are effective at preventing delinquency.

Community Oriented Policing Services (COPS): $225.5 million. COPS grantsshould be terminated, because these grants assign functions to the federal government that fall within the expertise, jurisdiction, and constitutional responsibilities of state and local governments. Further COPS grants were used tosupplant local funds and had little to no effect on reducing crime.

FEMA Fire Grants: $675 million. Fire grants should be terminated. Fire grants, which subsidize the routine operations of local fire departments, are ineffective at reducing fire-related deaths and injuries of firefighters and civilians. Fire grants incorrectly encourage local fire departments to become increasingly dependent on federal funding.

David B. Muhlhausen, Ph.D., Research Fellow in Empirical Policy Analysis

Postal Service Saturday delivery: $2 billion. The Senate CR continues—by omission—the prior year’s ban on using the Postal Service’s small appropriation to reduce service levels, effectively mandating Saturday service. This, along with other such congressional restriction, limits the Postal Service’s ability to reduce costs and increases the risk of massive federal subsidies in the near future.  (Yes, the Post Master CAN NOT  make decisions that would make the Post Office more efficient because of Congress!  BB)

—James Gattuso, Senior Research Fellow in Regulatory Policy

NASA Manned Spacecraft: $1.2 billion. The Orion Multi-Purpose Crew Vehicle is the new manned spacecraft NASA is developing for exploration of the Moon and Mars and for other purposes. Manned space flight is vastly more expensive than robotic exploration and is largely a public relations showcase for NASA to market itself to the American people. NASA’s budget should be pared back to a tight focus on cost-effective projects to advance its core missions.

(This is one I disagree with.  The United States and Americans have  benefited much from inventions made and perfected by the space program.  I won’t go into the many, many inventions because you can google them for yourself.  The space program should not be cut.   And, another reason is the brain drain because these NASA scientists needing jobs will go to Russia, china and other countries; do we really want this?   BB )

—J. D. Foster, Norman B. Ture Senior Fellow in the Economics of Fiscal Policy

National Science Foundation (NSF): $221 million. The bill would increase funding for NSF by $221 million, compared to the fiscal year (FY) 2012 enacted level, putting the total funding amount to $7.25 billion. Yet NSF has spent large amounts on research projects that are clearly not federal priorities ($325,000 for a “Robosquirrel” study; $516,000 creating a video game simulating prom week; and $350,000 for a study on how golfers should imagine a bigger hole when playing). Basic research is important, but given that NSF funding is diverted to inappropriate projects, it becomes wasteful. Budget reductions may help encourage more prudence.

National Institutes of Health (NIH): $71 million. Some of NIH’s funding goes to projects that seem inappropriate, such as $550,000 to acquire evidence that heavy drinking in a person’s 30s can lead to feelings of immaturity, while in their 20s it would not.

Legal Services Corporation (LSC): $358 million. This program should be terminated, because these services should be funded locally. The money is oftendiverted instead of going to poor people needing legal services, and there is a long history of waste and abuse of these funds by executives at the LSC.

Transportation. The bill would increase funding for highway programs and transit formula grants to match the levels authorized in Moving Ahead for Progress in the 21st Century (MAP-21), current surface transportation law. It also funds a $4 million Transit Safety office that was authorized in MAP-21. By funding this new office and the transit formula grants, the bill would continue diversions of limited Highway Trust Fund (HTF) user fees to transit, which is a demonstrated local—not a federal—priority.

Transit serves truly local needs and is predominantly concentrated in just six cities.Congress should end such diversions from the HTF, because they come at the expense of highway and bridge maintenance and expansion projects and do not demonstrably improve mobility and safety.

—Emily Goff,  Research Associate

Housing and Urban Development Public Operating Fund: $562 million. The bill restores money from an FY 2012 cut to previous levels for a total 2013 funding request of $3.962 billion. The fund pays local public housing authorities annual subsidies for such things as maintenance, management, insurance and energy costs. These should be the responsibility of local jurisdictions.

—David C. John, Senior Research Fellow

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In case you missed these during the year I am posting Heritage top 10 2012 research papers here in one place.  They are all as relevant now as when they were published; in fact some even more so.  The United States is well on its way to total destruction as a free nation.  Our one chance at salvation was to elect Mitt Romney for President and we didn’t.  Obama won by a slim margin, but he  and the Democrats take that as a mandate to do as they please and because they still control the Senate and Harry Reid is at the helm there is nothing in the federal government to stop them.   The only forces now fighting Obama and Obamanation are the states and some very brave companies and individuals  who are trying thru the courts to hold off or hold back the onslaught of our demise.    I think you need to know what all of these reports say in order to perhaps  minimize the  personal damage the federal government will do to individuals in the coming years.  Sincerely and Happy New Year my Friends, BB

Top 10 Heritage Research Papers of 2012

Todd Thurman

December 27, 2012 at 8:02 am

federal spending 2008 – 2012As the year comes to a close, we reflect on 2012 by offering highlights of the top 10 most-read research papers by Heritage scholars.

1) The 2012 Index of Dependence on Government
By William Beach and Patrick Tyrrell
February 8, 2012
The great and calamitous fiscal trends of our time—dependence on government by an increasing portion of the American population, and soaring debt that threatens the financial integrity of the economy—worsened yet again in 2010 and 2011.

2) Taxmageddon: Massive Tax Increase Coming in 2013
By Curtis Dubay
April 4, 2012
If President Obama and Congress fail to act this year, an enormous, unprecedented tax increase will fall on American taxpayers starting on January 1, 2013.

3) High Gas Prices: Obama’s Half-Truths vs. Reality
By Nicolas Loris
February 23, 2012
Higher gas prices drive up production costs for goods reliant on transportation, and more money spent at the pump means less money spent at restaurants and movie theaters.

4) Federal Spending by the Numbers
By Alison Acosta Fraser
October 16, 2012
The federal government has closed out its fourth straight year of trillion-dollar-plus deficits, and the imperative to rein in spending has never been greater.

5) Red Tape Rising: Obama-Era Regulation at the Three-Year Mark
By James L. Gattuso and Diane Katz
March 13, 2012
During the first three years of the Obama Administration, 106 new major federal regulations added more than $46 billion per year in new costs for Americans.

6) The Ryan Budget: Confronting the Nation’s Spending Crisis
By Alison Acosta Fraser and Patrick Louis Knudsen
March 21, 2012
In the few months since Washington’s dramatic debt ceiling confrontation, America’s fiscal situation has only worsened. Federal spending is set to soar past previous record-shattering levels, endangering the economic future of the nation.

7) Auto Bailout or UAW Bailout? Taxpayer Losses Came from Subsidizing Union Compensation
By James Sherk and Todd Zywicki
June 13, 2012
The U.S. government will lose about $23 billion on the 2008-2009 bailout of General Motors and Chrysler. President Obama emphatically defends his decision to subsidize the automakers, arguing it was necessary to prevent massive job losses.

8) Government Employees Work Less than Private-Sector Employees
By Jason Richwine, Ph.D.
September 11, 2012
The stereotype of the under-worked government employee is frequently invoked in criticisms of public-sector employment. But does the average public employee really work less than the average private employee?

9) Tax Policy Center’s Skewed Analysis of Governor Romney’s Tax Plan
By Curtis Dubay
September 23, 2012
Their conclusion is the result of a series of carefully made choices. These choices, not the underlying nature of the Romney plan, cause them to arrive at their selected result. This finding is harming the debate on tax reform.

10) Welfare Reform’s Work Requirements Cannot be Waived
By Andrew M. Grossman
August 8, 2012
Under the guise of providing states greater “flexibility” in operating their welfare programs, the Obama Administration now claims the authority to weaken or waive the work requirements that are at the heart of welfare reform.

I loved the debate last night!  Romney was really out there and every bit the President we need.  He was respectful of the President but did not tolerate inaccuracies and came right back with the truth.  Obama reminded me of nothing more than a little boy who was being scolded by his Daddy.  He looked down and wouldn’t look Romney in the eye because he couldn’t; he couldn’t refute the truth of the facts Mitt Romney was putting forth to counter the lies Obama was telling and the  dismal facts of Obama’s administration’s mistakes and blunders and bad policies.  Then Obama allowed his nasty ego to show  when he let us see how upset and affronted he was to have anyone dare to question and confront him.    If there had been just five more  minutes left Obama would have exploded in a nasty temper tantrum.  I expect to see this tantrum in the next debate! because this  egomaniac  holds a grudge and will just have to come back, and in public.  We will see the real Obama next time..    In the meantime Heritage has some great articles on  debate questions and facts and follow up that I hope you will read.   I am printing just one article here but do go to their site and read several of their articles.  In fact, if you do not subscribe to the Heritage Foundation you really should.   BB

10 Questions for the First Presidential Debate

Tonight’s debate between President Barack Obama and former Governor Mitt Romney is supposed to focus on domestic policy, with a major concentration on the economy. Health care, the role of government, and philosophy of governing are also on the agenda. The Heritage Foundation’s policy experts have submitted 10 questions they would like to see asked in the debate.

1. In 2008, then-candidate Obama said, “Under my plan, no family making less than $250,000 a year will see any form of tax increase.” In reality, President Obama’s signature health care law contains 18 new or increased taxes and penalties that will cost taxpayers $836.3 billion over the next 10 years, many of which fall heavily on the middle class. In fact, almost 70 percent of those responsible for paying the fiercely debated individual mandate are below 400 percent of the federal poverty level.Should these tax increases be stopped to protect middle-class Americans from their damage? If yes, where would the money needed to help pay for Obamacare come from?

2. Millions of baby boomers are starting to retire, and spending on Social Security and Medicare as these programs are currently structured is simply unsustainableWhat is your plan to solve the looming entitlement program spending crisis?

3. Medicare as we know it today is facing severe financing problems that are unsustainable and putting future generations’ Medicare benefits in jeopardy. Over the long term, Medicare has made $37 trillion worth of promises to seniors that it cannot keep and the hospital insurance trust fund will be empty by 2024. Worse, the President’s health care law will cut Medicare by $716 billion over the next 10 years to pay for new spending in Obamacare. As Medicare’s solvency hangs in the balance, what structural reforms, if any, are you willing to make to preserve Medicare for future generations?

4. Everyone talks about shoring up our battered American DreamHow would you define the American Dream and what do you think are the most serious threats to it?

5. The Health and Human Services Department recently rewrote the law governing welfare to weaken its work requirements. Meanwhile, the number of people relying on food stamps has doubled under the current Administration. Should all able-bodied recipients be required to work or prepare for work as a condition of receiving aid in public housing, food stamps, and cash assistance?

6. The federal government is currently spending much more than it has, and annual budget deficits over $1 trillion have become the norm.What is your plan to stem the tide of deficits and rising debt?

7. One of the few bright spots in America’s economy has been energy production, particularly on state and private lands.  According to the Energy Information Administration (EIA), energy production decreased 13 percent on federal lands in fiscal year (FY) 2011 when compared to FY 2010. What would you do to reverse course on energy production on federal lands?

8. Congress—most notably the Senate, which hasn’t produced a budget in over three years—is sorely lacking in its basic responsibility of budgeting.What would you do to ensure the fundamental process of budgeting is restored?

9. President Obama has previously stated that, in the most important 5 percent of cases before the courts, it matters more what is in a judge’s heart (what has come to be known as his empathy standard) than what the rule of law requires. Is this the correct standard by which to evaluate judicial nominees? If not, what standard would you apply?

10. Former Attorney General of Mexico Victor Humberto Benítez Treviño estimated that approximately 300 Mexican citizens have been killed using Fast and Furious weapons in addition to U.S. Border Patrol Agent Brian Terry. Should Eric Holder resign as Attorney General because of his failures related to Operation Fast and Furious, including his failure to properly supervise the operation? If not, why not?

Watch the debate with Heritage tonight—you can watch it live, streaming on our Debate 2012 page. On the page, you can also follow our experts’ live blog and chime in on Twitter.

I wondered why the Federal Reserve would order banks to take a “stress test”  that would determine how well they were able  to withstand  a sudden and severe drop in the stock market unless they were anticipating such a drop.  Guess my wondering is in good company a contributor to Big Government blog had the same wonder but he put his into perspective as to what this would do to the country.  Interesting post.  I might advise you all to buckle up and hang on out there.   At least that is what I am doing! BB

Fed Warns Unemployment May Double Great Depression

by Chriss W. Street

I warned last week that a recession and higher unemployment were about to hit the U.S. economy. On Tuesday, the Bureau of Economic Analysis cut their estimate of growth in the third quarter ending September from 2.5% to 2%. Then on Wednesday, the Federal Reserve rocked financial markets by forcing America’s 31 largest U.S. banks to “stress test” balance sheets to determine their capability to withstand an 8% drop in the economy; which would cause home prices to plunge by 21%, and unemployment rate to jump to 13%.

I illuminated in my report that U.S. Bureau of Labor Statistics has been under-counting unemployment by at least 2%. For a nation reporting 154.4 million workers; this means the 13.9 million reportedly unemployed should actually be 17 million. Given only 12.8 million were unemployed at the 1933 peak of the Great Depression, when the undercounting and the Fed’s stress test are added the total is 23.2 million unemployed; almost double the Great Depression.

(The only reason we are not seeing bread lines and homeless people flooding the streets is that now we have the federal government handing out up to 99 weeks of unemployment benefits as well as 47+ million people on food stamps.  during the Great Depression these programs were not available..  Which certainly proves the statement I have been making for decades that the next depression would make the so-called “Great” one look like a Sunday picnic.     Of course the  unemployed as well as the employed and their great grandchildren are on the hook for all the money that is being borrowed to pay for these benefits!  Which brings me to the second difference between now and then:  big business was on the hook and were the ones going into deep debt and bankrupt rather than the people via our government, but during these intervening years Congress has undertaken to protect business  and even banking by taking on the risk of doing business in America while not enforcing the rules that business “help” pay for these protective programs.  One of the most egregious business protecting programs that Uncle Sam has taken from business is the promise to pay retirement benefits if a business is unable to do so.  Companies are suppose to pay into a trust fund for these programs but they don’t and no one is watching the store to see that they do!  Companies do not even have to go bankrupt in order for the government to step up to the plate with our wallets open!  BB)

Formerly bullish top bank analyst Dick Bove in an Bloomberg interview commented on the Fed:

“By taking these draconian views of what could happen in the market, if they in fact force the banks to defense themselves against the outlook that they’ve put up, they’ll cause a recession,”

Consistent with my prediction that the booming production of capital goods would fall hard next year after the expiration of the 100% “bonus depreciation” tax credit; the bad news parade picked up steam this week with reports that U.S. durable goods orders fell 0.7 percent last month and initial jobless claims came in higher than Wall Street analyst’s predictions.

On the always dismal European front, interest rates on German “Bund” Treasury Bonds exceeded the interest rates on U.S. Treasury bonds for the first time as traders feared the financial turmoil of Portugal, Italy, Greece, and Spain (aka the “PIGS”) is causing a financial contagion that may implode solvency of German banks. Peter Cecchini, head of investment strategy at Cantor Fitzgerald in New York reporting on effects of the European financial crisis for the rest of the world: “Evidence is slowly mounting that containment is a pipe dream,”

In the delightful Middle East, the Aircraft Carrier George H.W. Bush left its traditional theater of operations watching Iran and the Persian Gulf, and moved to the closest point to Syria in preparation for implementing a “no-fly-zone” by American, European, and Arab League forces. CBS also just reported: “The U.S. Embassy in Damascus urged its citizens in Syria to depart “immediately,” and Turkey’s foreign ministry urged Turkish citizens on pilgrimages to “return home from Saudi Arabia to avoid traveling through Syria.”

During the month of November the equity shares of the 31 banks the Fed directed to begin their stress test have now fallen 13%; with Goldman Sachs and Bank of America trading at their lowest prices since the lows of the Great Recession in March of 2009. If the economy heads for a sharp recession and unemployment leaps, there will be hell to pay for politicians in November’s election.

And of course with all this happening our Congress men and women in their appointed  Super Committee made up of the greatest brains (?????)  in Congress failed to agree to taking  3 cents out of every dollar the government spends for the next ten years!  There seems to be a movement of saner heads in Congress to bring the President’s appointed deficit Reduction Committee’s  (known as the Simpson-Bowles Committee) recommendations to a vote.  I expect this to happen in the Republican controlled House of Representatives and to pass.  but Democrat Senator Harry Reid will not allow it to come to the floor for a vote in the democratically controlled Senate.  There are i believe now a total of 48 bills  that were passed in the House that are sitting on the shelf in the Senate!  BB

This Week in Government Failure | Cato @ Liberty.

This Week in Government Failure

Posted by Tad DeHaven

Over at Downsizing the Federal Government, we focused on the following issues this past week:

  • It’s darkly comical that the same entity responsible for killing countless private sector jobs with its taxes and regulations operates job training programs.
  • Warren Buffett should put up or shut up.
  • Two polls of likely voters released by Rasmussen Reports indicate that the federal government’s corporate welfare programs should be prime targets for spending cuts.
  • (Wanted to make sure you saw the results of these polls.

    Voters Don’t Support Corporate Welfare

    Two polls of likely voters released by Rasmussen Reports today indicate that the federal government’s corporate welfare programs should be prime targets for spending cuts.

    The first poll found little support for the Small Business Administration’s lending programs:

    • A majority (58 percent) of likely voters said that the federal government shouldn’t guarantee loans issued by private lenders to small businesses. 23 percent said the government should back small business loans and 19 percent were unsure.
    • A majority (59 percent) of likely voters said that reducing government regulations and taxes would be more helpful to small businesses than the government providing loans to small businesses that can’t obtain financing on their own. 22 percent said the government loans were better and 18 percent were unsure.  ( I am definitely among the 58%!  BB)
    • Entrepreneurs particularly believed that reducing government regulations and taxes is preferable to government lending programs. 76 percent of entrepreneurs felt that way and 61 percent opposed government loans to small businesses that couldn’t obtain financing. (These are the people with the ideas People.  So listen to them carefully because they are the movers and shakers of America.  In fact, these people are almost uniquely America because America is (or at least ONCE WAS) the only place on earth where these people with ideas and dreams could make their dreams come true.  Obamanation has brought this to a halt and is working hard to kill the entire idea of anyone in America having an original thought.  BB)

    (See this new Cato essay on why the Small Business Administration should be terminated.) (AGREED!  BB)

    Similarly, the second poll found little support for various federal corporate welfare programs:

    • Only 15 percent of likely voters said the federal government should continue to provide funding for foreign countries to buy military weapons from U.S. companies. 70 percent were opposed and the rest were undecided.  (Where in Hell did they find the 15%!??!  BB)
    • Only 29 percent of likely voters said the government should continue to provide loans and loan guarantees to help finance export sales for large corporations. 46 percent were opposed and the rest were undecided. (See Sallie James’ new Cato paper on why the Export-Import Bank should be terminated.)  (I am sure this undecided vote was because the respondents could not understand the question.  ONLY large well o0rganized and connected companies export their products and these companies surely do not need any tax dollars to do so as they will continue on their own if a profit is being made.  I would like to say this practice will come to a halt after 2012 when we get a person with sense in the White House but congressmen on the company dole are not likely to stop anything that might annoy their buds.  BB)
    • Only 37 percent of likely voters said the federal government should continue providing farm subsidies. A plurality (46 percent) said farm subsidies should be abolished and 17 percent weren’t sure. (See this Cato essay for more on farm subsidies.)   (Just for information purposes:  the so-called “family farm” ain’t the family farm anymore People.  The Family Farm is now BIGGGGGGG Agribusiness and just like any other business it certainly doesn’t need our tax dollars.  But just play hell getting rid of it!  BB)
    • The Washington Post asks for budget plans. We have one.   (No comments from me here because it ALL makes a lot of sense and I hope you go to all the sites referred and read carefully.  BB)
    • Despite Fannie Mae and Freddie Mac’s role in driving the housing bubble and $160 billion in taxpayer losses (so far), President Obama appears to be considering just putting the same failed system in place.   (Did anyone really expect anything else??!  By the way, Fannie Mae is the outfit that gave  me the deal on my house.  but it really wasn’t a deal at all, it was where the price of the house would have been if government had not gotten into the notion of everyone deserves and has a “right” to own a home and started making sure everyone got one regardless of if they could pay for it.  the government getting in of course made the prices for houses go sky high.  Just as the government getting into anything causes the prices of that good or service to go sky high—-haven’t we learned a thing yet?  Those supplying the goods or service are not dumb and know they will get their price no matter where they set it.  Government got into medical care with Medicare and Medicaid and doctor, hospitals, medical supply companies, health insurance companies and drug companies all sent their  prices  up by double digits for 40 years.  Government got into education and colleges and universities went hog wild at the banquet of federal money via the students.  As sure as the moon follows the sun and the sun follows the moon the big money will follow the government money.  BB)
Charles Krauthammer
Charles Krauthammer
Opinion Writer

The great divide

, Published: July 28

We’re in the midst of a great four-year national debate on the size and reach of government, the future of the welfare state, indeed, the nature of the social contract between citizen and state. The distinctive visions of the two parties — social-democratic vs. limited-government — have underlain every debate on every issue since Barack Obama’s inauguration: the stimulus, the auto bailouts, health-care reform, financial regulation, deficit spending. Everything. The debt ceiling is but the latest focus of this fundamental divide.The sausage-making may be unsightly, but the problem is not that Washington is broken, that ridiculous ubiquitous cliche. The problem is that these two visions are in competition, and the definitive popular verdict has not yet been rendered.

We’re only at the midpoint. Obama won a great victory in 2008 that he took as a mandate to transform America toward European-style social democracy. The subsequent counterrevolution delivered to that project a staggering rebuke in November 2010. Under our incremental system, however, a rebuke delivered is not a mandate conferred. That awaits definitive resolution, the rubber match of November 2012.

I have every sympathy with the conservative counterrevolutionaries. Their containment of the Obama experiment has been remarkable. But reversal — rollback, in Cold War parlance — is simply not achievable until conservatives receive a mandate to govern from the White House.

Lincoln is reputed to have said: I hope to have God on my side, but I must have Kentucky. I don’t know whether conservatives have God on their side (I keep getting sent to His voice mail), but I do know that they don’t have Kentucky — they don’t have the Senate, they don’t have the White House. And under our constitutional system, you cannot govern from one house alone. Today’s resurgent conservatism, with its fidelity to constitutionalism, should be particularly attuned to this constraint, imposed as it is by a system of deliberately separated — and mutually limiting — powers.

Given this reality, trying to force the issue — turn a blocking minority into a governing authority — is not just counter-constitutional in spirit but self-destructive in practice.

Consider the Boehner Plan for debt reduction. The Heritage Foundation’s advocacy arm calls it “regrettably insufficient.” Of course it is. That’s what happens when you control only half a branch. But the plan’s achievements are significant. It is all cuts, no taxes. It establishes the precedent that debt-ceiling increases must be accompanied by equal spending cuts. And it provides half a year to both negotiate more fundamental reform (tax and entitlement) and keep the issue of debt reduction constantly in the public eye.

I am somewhat biased about the Boehner Plan because for weeks I’ve been arguing (in this column and elsewhere) for precisely such a solution: a two-stage debt-ceiling hike consisting of a half-year extension with dollar-for-dollar spending cuts, followed by intensive negotiations on entitlement and tax reform. It’s clean. It’s understandable. It’s veto-proof. (Obama won’t dare.) The Republican House should have passed it weeks ago.

After all, what is the alternative? The Reid Plan with its purported $2 trillion of debt reduction? More than half of that comes from not continuing surge-level spending in Iraq and Afghanistan for the next 10 years. Ten years? We’re out of Iraq in 150 days. It’s all a preposterous “saving” from an entirely fictional expenditure.

The Congressional Budget Office has found that Harry Reid’s other discretionary savings were overestimated by $400 billion. Not to worry, I am told. Reid has completely plugged that gap. There will be no invasion of Canada next year (a bicentennial this-time-we’re-serious 1812 do-over). Huge savings. Huge.

The Obama Plan? There is no Obama plan. And the McConnell Plan, a final resort that punts the debt issue to Election Day, would likely yield no cuts at all.

Obama faces two massive problems — jobs and debt. They’re both the result of his spectacularly failed Keynesian gamble: massive spending that left us a stagnant economy with high and chronic unemployment — and a staggering debt burden. Obama is desperate to share ownership of this failure. Economic dislocation from a debt-ceiling crisis nicely serves that purpose — if the Republicans play along. The perfect out: Those crazy Tea Partyers ruined the recovery!

Why would any conservative collaborate with that ploy? November 2012 constitutes the new conservatism’s one chance to restructure government and change the ideological course of the country. Why risk forfeiting that outcome by offering to share ownership of Obama’s wreckage?

 

 

 

Video

In both debt plans, the wealthy win.

In both debt plans, the wealthy win.

Obama and his minions have always and ever used distraction to push their more horrific project, and this debt ceiling distraction is a real winner for them.  See what has been going on in the background while we and TV news has been watching elsewhere.  Or maybe you have been like me and tuning it all out!  BB

On the floor: Meanwhile, the full House continues to debate the 2012 Interior and Environment appropriations bill, which Democrats say is the worst environmental bill to come before the House — ever. The bill contains 39 riders limiting the ability of the EPA to regulate; Democrats are attempting to strip out as many as possible.

Reviewing regulators: The Senate Banking Committee will be getting its vet on tomorrow, welcoming three nominees the White House wants to put at the center of the government’s financial regulation.

The trio scheduled to be on hand are: Martin Gruenberg, tapped to replace Sheila Bair at the top of the Federal Deposit Insurance Corporation; Thomas Curry, the choice for next comptroller of the currency; and Roy Woodall, the pick for insurance expert on the new Financial Stability Oversight Council. Financial regulatory nominees have had a rocky road in confirmation battles lately — here’s looking at you, Peter Diamond and Richard Cordray — so keep an eye open to see if these three fare better.

Consumption!: Mike Huckabee, the former Arkansas governor and GOP presidential candidate, is one of a deep bench — nine witnesses overall — talking consumption taxes at House Ways and Means tomorrow.

Huckabee and two others will discuss the Fair Tax, the idea of replacing federal taxes with a sizable national sales tax. The rest of the panelists will discuss the Value Added Tax, a consumption tax that has sparked skepticism from both the right and the left in this country. All that said, the VAT is quite popular in much of the rest of the industrialized world — where, perhaps not coincidentally, most countries also have a lower corporate tax rate.

If at first you don’t succeed …
Senate Finance is going back to the well for a hearing on deficit reduction, three weeks or so after the debate over the pending trade deals caused the postponement of a previously scheduled discussion. Peter Orszag, the former White House budget director, is not scheduled to testify this time around, but Finance will hear from liberal and conservative experts.

Speaking of which: The U.S. Chamber of Commerce is taking its case on those trade deals — with South Korea, Panama and Colombia — to Capitol Hill, holding a rally to help push for their passage. The agreements remained stalled due to disagreements over whether they should be linked to the Trade Adjustment Assistance program.

The briefing room: A more conservative group of congressional Republicans will be gathering tomorrow to unveil legislation that would tell the president what bills to pay if the government hits the debt ceiling. Under the bill, the administration would have to prioritize payments for debt service, Social Security and military pay before attending to other obligations. The RSC’s Jordan, Sen. Jim DeMint of South Carolina and others will be on hand to roll out EFFCUSPASSA — that’s the Ensuring the Full Faith and Credit of the United States and Protecting America’s Soldiers and Seniors Act, for those of you scoring at home.

Fed fulminating: Rep. Ron Paul (R-Texas) will return to the fertile grounds of Federal Reserve bashing on Tuesday, with his House Financial Services subcommittee exploring how the central bank’s monetary policy affects the economy.

Specifically, the panel will discuss inflation, unemployment and the potential for a third round of “quantitative easing.” The Fed has said it is prepared to pump more stimulus into the economy if needed, but Ben Bernanke, the Fed chairman, has emphasized that nothing is in the works immediately. Thomas Hoenig, the president of the Federal Reserve Bank of Kansas City and no fan of the last QE experience, will be on hand to testify.

Risky renting: A second House Financial Services subcommittee will train its sights on the rent-to-own industry Tuesday, as lawmakers explore what regulators should or shouldn’t be doing as they monitor the agency.

Preparing for the floor: The House Rules Committee will meet to set up a bill that wades in to the spat between Boeing and the National Labor Relations Board over whether the aerospace giant shifted work to a South Carolina plant to punish union action in Washington state.

Last week, the House Education and the Workforce Committee marked up legislation sponsored by Rep. Tim Scott  (R-S.C.) that not only bars the NLRB from shifting Boeing work back to Washington, but prohibits “ordering any employer to close, relocate or transfer employment under any circumstance.”

Quick hits:

— Rep. Dennis Kucinich (D-Ohio) has a briefing of his own planned, titled “Eliminating the Debt and Creating Jobs without Raising Taxes.”

— Christine Lagarde, the new IMF chief, headlines an early morning Council on Foreign Relations conference call on the world economy.

— A Senate Judiciary subcommittee looks at the economic case for and against immigration reform.

— And dozens of religious figures head to the Hill for a prayer vigil on ensuring the poor don’t have to shoulder the burden of a debt deal.

Economic indicators:

— Standard & Poor’s is scheduled to release its Case–Shiller 20-city home price index for May.

— The Commerce Department is slated to circulate its report on new privately owned one-family houses sold and for sale in June, as the housing market struggles to show any improvement.

— And the Conference Board is set to drop its consumer confidence index for July, a way to examine potential spending habits of consumers, which represents 70 percent of the economy.

BREAKING MONDAY:

It’s not just in Washington: Concern about debt is everywhere. A new Associated Press/GfK poll found that one in five are worried about debt practically all the time, and more than one in three say they won’t be able to pay off their credit card bill.

And a break from the debt ceiling: Rep. Shelley Berkley (D-Nev.), Ways and Means member and Senate candidate, has introduced her own bill to allow U.S. multinationals to bring offshore profits home at a reduced tax rate, Bloomberg reports.

The lowest possible rate in the bill, 5.25 percent, matches the rate in a previous holiday and the one called for in another House proposal in this area. But a company’s rate could be as high as 25 percent under the plan, depending on its hiring practices.

WHAT YOU MIGHT HAVE MISSED:

On the Money’s Monday:

— Jim DeMint on Reid/Boehner plans: They’re both no good.

— IMF: The debt ceiling must be raised.

— The White House turns its head toward criminal syndicates.

— The IRS reverses course on its innocent-spouse policy.

— Joint Economic Committee: 32 states added private-sector jobs in June.

— House Oversight set to take a look at excess federal property.

— And audit finds the IRS needs to tighten up on homebuyer credit.

Feedback, etc., to bbecker@thehill.com


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