Free Markets, Free People

Daily Archives: January 26, 2011


Year 3 of Obamanomic brings us $1.5 trillion more of debt

Or so sayeth the CBO.  Good thing they waited until today to announce it.  Otherwise we might have heard snickering and outright laughter during the SOTU when our deficit-hawk President talked about how serious he was about reducing the deficit and the debt.

The budget deficit is now estimated to have widened this year to $1.5 trillion, the CBO said. That compares to a budget deficit of $1.3 trillion for the fiscal year that ended Sept. 30.

The increase in the deficit would bring it to 9.8 percent of gross domestic product, the CBO said, following deficits of 10 percent and 8.9 percent during the previous two years.

Do you remember how he promised to half the debt by the end of his first term in office?  Yeah?  Well that means he could run a deficit of $750 billion and keep his word.  Funny how that works out, huh?

The CBO’s projections assume that current laws remain unchanged. If the nation continues on its current path, the CBO said, the total national debt will rise from 40 percent of GDP in 2008 to 70 percent by the end of 2011, reaching 77 percent of GDP by 2021.

But hey, this is all the other guy’s fault, remember?  Oh, and one more point, those of you on the left having fun with Rep. Paul Ryan’s factual response?  Make sure you go find someone who can explain the ramifications of this to you, ‘kay?  And have them point out who it is that the CBO agrees with in principle as well:

“To prevent debt from becoming unsupportable, the Congress will have to substantially restrain the growth of spending, raise revenues significantly above their historical share of GDP, or pursue some combination of the those two approaches,” CBO Director Douglas Elmendorf wrote in a blog post announcing the report.

While you’re at it, have them explain the appetite for tax increases. Wait, I’ll save you the question – there is none.  See December’s extension of the current income tax rates.  Now, given that – try to focus.  What does that leave?  Yes, they’re left with “substantially restrain[ing] the growth of spending”.  As in “no more new spending” and “cut back existing spending”.  Precisely what Ryan has been saying, isn’t it?

So when Rep. Ryan makes the point that:

Under the terms of a House resolution passed Tuesday, Ryan is to set ceilings at 2008 levels or less.

He has a good reason, one backed by the facts of the situation and not some meandering mewling from Paul Krugman.  This is the medicine for the addiction.  America has said and is saying again that the voters are not willing to give you a single nickel more until government proves it can significantly cut it’s spending habit.  No cuts, no increased taxes.  In fact, if the cuts are indeed significant enough, the perhaps no new taxes are needed at all.

Yeah, I know, living within your means like all the rest of us have to do – what a concept.

~McQ


Translating the SOTU

So many words to translate from Obama lingo to English.  For instance:

New laws will only pass with support from Democrats and Republicans. We will move forward together, or not at all – for the challenges we face are bigger than party, and bigger than politics.

Translation: We’ve had our run for two years, spending trillions of dollars wastefully and jamming through a huge big government program for health care.  Now, Repubicans, its time for “bi-partisanship”.

Thanks to the tax cuts we passed, Americans’ paychecks are a little bigger today. Every business can write off the full cost of the new investments they make this year. These steps, taken by Democrats and Republicans, will grow the economy and add to the more than one million private sector jobs created last year.

Translation: I resisted it until the end and was backed into a corner, but hey, this is the SOTU and I’ll try to get out in front of all of that and claim credit since it seems to be working.

Our free enterprise system is what drives innovation. But because it’s not always profitable for companies to invest in basic research, throughout history our government has provided cutting-edge scientists and inventors with the support that they need. That’s what planted the seeds for the Internet. That’s what helped make possible things like computer chips and GPS.

Translation: Please disregard the fact that I’m contradicting myself.  Please understand that the first few sentences are only something to be used to justify further government spending.  And here it is:

This is our generation’s Sputnik moment. Two years ago, I said that we needed to reach a level of research and development we haven’t seen since the height of the Space Race. In a few weeks, I will be sending a budget to Congress that helps us meet that goal. We’ll invest in biomedical research, information technology, and especially clean energy technology – an investment that will strengthen our security, protect our planet, and create countless new jobs for our people.”

Translation: I plan to call new spending “investment” so we can pretend it isn’t just more of the same.  And if I couch it in high sounding rhetoric about research and development and use scare terms like “Sputnik moment”, it’s sure to make it all seem to be a net “good thing”.

We’re not just handing out money. We’re issuing a challenge. We’re telling America’s scientists and engineers that if they assemble teams of the best minds in their fields, and focus on the hardest problems in clean energy, we’ll fund the Apollo Projects of our time.

Translation: In reality we are “just handing out money”.  Your money.  Money you earned and for which you probably had quite a different priority – like feeding and clothing your family and putting a roof over their head.  Instead we prefer to subsidize marginal technology which to this point hasn’t shown the ability to effectively provide the energy we need to move forward instead of subsidizing those that do.  And if you don’t believe me:

We need to get behind this innovation. And to help pay for it, I’m asking Congress to eliminate the billions in taxpayer dollars we currently give to oil companies. I don’t know if you’ve noticed, but they’re doing just fine on their own. So instead of subsidizing yesterday’s energy, let’s invest in tomorrow’s.

Translation: The war on domestic oil continues.  It’s just nasty.  And dirty.  And we need “clean” energy.  Forget the fact that the technology for such energy isn’t anywhere near ready for primetime and doesn’t appear it will be for years, decades even.  Let’s dump on domestic oil now – that’s sure to make us less dependent on foreign oil – something I called on us to do earlier in the speech.

Now, clean energy breakthroughs will only translate into clean energy jobs if businesses know there will be a market for what they’re selling. So tonight, I challenge you to join me in setting a new goal: by 2035, 80% of America’s electricity will come from clean energy sources.

Translation: I love issuing challenges, especially when I can’t be held responsible for them if they don’t work out.  We can’t even generate 10% of our needs through “clean energy” and it doesn’t appear we’ll be any closer in 2035 given the current state of technology, but it does help me justify my war on domestic oil when I say things like this.

Oh, and education?  Well, it needs – get ready for it – more money:

Our schools share this responsibility. When a child walks into a classroom, it should be a place of high expectations and high performance. But too many schools don’t meet this test. That’s why instead of just pouring money into a system that’s not working, we launched a competition called Race to the Top. To all fifty states, we said, “If you show us the most innovative plans to improve teacher quality and student achievement, we’ll show you the money.”

Translation: We’ve had a Department of Education for decades and our education levels have slipped terribly … abysmally … for its entire existence.  But this will fix that.  All we need is to spend more.   Trust me.

Oh, and did I mention more spending? 

Over the last two years, we have begun rebuilding for the 21st century, a project that has meant thousands of good jobs for the hard-hit construction industry. Tonight, I’m proposing that we redouble these efforts.

We will put more Americans to work repairing crumbling roads and bridges. We will make sure this is fully paid for, attract private investment, and pick projects based on what’s best for the economy, not politicians.

Within 25 years, our goal is to give 80% of Americans access to high-speed rail, which could allow you go places in half the time it takes to travel by car. For some trips, it will be faster than flying – without the pat-down. As we speak, routes in California and the Midwest are already underway.

Translation: Yeah, see, we don’t want to leave it up to states and local communities to do this stuff – we’d rather take their money to a federal level and then hand it back with strings and after we’ve taken our cut.  That way I and other politicians can take credit for it.  And if you believe all the malarkey I’m spreading about high-speed rail (and the claim there’ll be no “pat-downs”), I have some government bonds in which you might want to invest.  If you thought corn ethanol was a boondoggle, wait until we get involved in high-speed rail projects.

Within the next five years, we will make it possible for business to deploy the next generation of high-speed wireless coverage to 98% of all Americans.

Translation: That’s right, ‘we”.  It will never happen unless government is involved.  Businesses have absolutely no interest in deploying “next generation of high-speed wireless coverage” to everyone they can get it too.  That 4G stuff?  Oh, just ignore that.  And admit it – you’re much happier now that government is involved in policing the internet, right?  Hey, you can’t put the “BIG” in “big government” unless you’re involved in everything.

To reduce barriers to growth and investment, I’ve ordered a review of government regulations. When we find rules that put an unnecessary burden on businesses, we will fix them.

Translation: Not really, but it sounds good, doesn’t it?  But you have to be reminded that without government, well, you’d just be in a freakin’ mess wouldn’t you?

But I will not hesitate to create or enforce commonsense safeguards to protect the American people. That’s what we’ve done in this country for more than a century. It’s why our food is safe to eat, our water is safe to drink, and our air is safe to breathe. It’s why we have speed limits and child labor laws. It’s why last year, we put in place consumer protections against hidden fees and penalties by credit card companies, and new rules to prevent another financial crisis. And it’s why we passed reform that finally prevents the health insurance industry from exploiting patients.

Translation: Yeah, because without government, none of that would have ever happened, particularly the last and newest angle on the health care monstrosity we Democrats jammed through Congress last year.

Now, I’ve heard rumors that a few of you have some concerns about the new health care law.

Translation: What do you mean 28 states are suing over the law?

We are living with a legacy of deficit-spending that began almost a decade ago. And in the wake of the financial crisis, some of that was necessary to keep credit flowing, save jobs, and put money in people’s pockets.

Translation: That spending a decade ago – bad stuff.  Other guy’s fault.  Not mine (sure I was in the Senate, so what?). That 3 trillion I threw to the wind.  Good stuff.

I recognize that some in this Chamber have already proposed deeper cuts, and I’m willing to eliminate whatever we can honestly afford to do without. But let’s make sure that we’re not doing it on the backs of our most vulnerable citizens.

Translation: After all, if we let our “most vulnerable citizens” keep more of what they earn by cutting spending by trillions of dollars, they’ll just spend it on the wrong stuff.   Only we know what is important and what we can “honestly afford to do without”.

The bipartisan Fiscal Commission I created last year made this crystal clear. I don’t agree with all their proposals, but they made important progress. And their conclusion is that the only way to tackle our deficit is to cut excessive spending wherever we find it – in domestic spending, defense spending, health care spending, and spending through tax breaks and loopholes.

Translation: Yes, you read it right.  We’re now defining “excessive spending” as “spending” found in “tax breaks and loopholes”.  That’s a method of “cutting spending” of which I approve.

This means further reducing health care costs, including programs like Medicare and Medicaid, which are the single biggest contributor to our long-term deficit. Health insurance reform will slow these rising costs, which is part of why nonpartisan economists have said that repealing the health care law would add a quarter of a trillion dollars to our deficit. Still, I’m willing to look at other ideas to bring down costs, including one that Republicans suggested last year: medical malpractice reform to rein in frivolous lawsuits.

Translation: But remember – government has not taken over health care.  Say it with me – government has not taken over health care.

To put us on solid ground, we should also find a bipartisan solution to strengthen Social Security for future generations. And we must do it without putting at risk current retirees, the most vulnerable, or people with disabilities; without slashing benefits for future generations; and without subjecting Americans’ guaranteed retirement income to the whims of the stock market.

Translation: Let’s fix Social Security.  But not by privatizing it or any portion of it.  Only government is the answer and after all, we’ve handled it so well to this point we ought to be the go to entity, don’t you think?  We actually make Enron look good, but let’s not mention that, okay?

And if we truly care about our deficit, we simply cannot afford a permanent extension of the tax cuts for the wealthiest 2% of Americans. Before we take money away from our schools, or scholarships away from our students, we should ask millionaires to give up their tax break.

It’s not a matter of punishing their success. It’s about promoting America’s success.

Translation: I still want to tax the rich because we’ve screwed up the budget, the deficit and the debt so badly that we’re in horrible trouble and we need a fall guy to demonize for being selfish and not doing their “fair share”.  Lord knows government has done its fair share in screwing this up.  Seems to me the rich would be willing to part with their money to help us fix it.  Right?  Anybody?

In the coming months, my administration will develop a proposal to merge, consolidate, and reorganize the federal government in a way that best serves the goal of a more competitive America. I will submit that proposal to Congress for a vote – and we will push to get it passed.

Translation: And if you believe they’re going to be substantial changes, I have a bridge in Brooklyn you need to see.  But saying things like that allows me to push my “big government is good government” theme:

In the coming year, we will also work to rebuild people’s faith in the institution of government.

Translation: If I can sell this, I can push government into everything I want it in.

We may have differences in policy, but we all believe in the rights enshrined in our Constitution.

Translation: Well, we believe in those “rights” if we can redefine them on the fly – you know, like the “right” to health care?

From the earliest days of our founding, America has been the story of ordinary people who dare to dream.

Translation: That’s right – but now they must have government and government spending to make their dreams a reality.  Just remember that.  Meanwhile, start saving up for those coal-powered cars because we want millions of ‘em on the road in a few years. “ Dreams”, right?  Oh you thought I meant the dreams of ordinary people?  Uh, no, I meant the dream of government planners, of course.

Bah.

~McQ

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