I have been waiting for this for a long time. When I was in college finishing my latest degree here at IUSB I was making many of these very same claims about global warming alarmist nonsense as the IAC report below. Leftist students and faculty pretty much told me that I was nuts, and I wasn’t a climate scientist so how would I know? Well it looks like I knew. It was easy. First of all it doesn’t take a genius to see when the scientific method is being ignored and second of all, what I am an expert on is politics and I know a political movement when I see one.
At the bottom of the article I posted a list of links that I wrote starting in 2007 saying many of the same things the IAC has pointed out below. I have reactivated IUSB Vision just for the purpose of posting this story. All of you PhD. laden academics who doubted me and called me all of those names behind my back should ask yourselves; why was a mere undergrad like me spot on and all of you who are supposed to be teachers wrong? And this isn’t this first time that happened is it? – Chuck Norton
On June 27, the Intergovernmental Panel on Climate Change (IPCC) issued a statement saying it had “complete[d] the process of implementation of a set of recommendations issued in August 2010 by the Inter Academy Council (IAC), the group created by the world’s science academies to provide advice to international bodies.”
Hidden behind this seemingly routine update on bureaucratic processes is an astonishing and entirely unreported story. The IPCC is the world’s most prominent source of alarmist predictions and claims about man-made global warming. Its four reports (a fifth report is scheduled for release in various parts in 2013 and 2014) are cited by the Environmental Protection Agency (EPA) in the U.S. and by national academies of science around the world as “proof” that the global warming of the past five or so decades was both man-made and evidence of a mounting crisis.
If the IPCC’s reports were flawed, as a many global warming “skeptics” have long claimed, then the scientific footing of the man-made global warming movement — the environmental movement’s “mother of all environmental scares” — is undermined. The Obama administration’s war on coal may be unnecessary. Billions of dollars in subsidies to solar and wind may have been wasted. Trillions of dollars of personal income may have been squandered worldwide in campaigns to “fix” a problem that didn’t really exist.
The “recommendations” issued by the IAC were not minor adjustments to a fundamentally sound scientific procedure. Here are some of the findings of the IAC’s 2010 report.
Alternative views not considered, claims not properly peer reviewed
The IAC reported that IPCC lead authors fail to give “due consideration … to properly documented alternative views” (p. 20), fail to “provide detailed written responses to the most significant review issues identified by the Review Editors” (p. 21), and are not “consider[ing] review comments carefully and document[ing] their responses” (p. 22). In plain English: the IPCC reports are not peer-reviewed.
No formal criteria for selecting IPCC authors
The IAC found that “the IPCC has no formal process or criteria for selecting authors” and “the selection criteria seemed arbitrary to many respondents” (p. 18). Government officials appoint scientists from their countries and “do not always nominate the best scientists from among those who volunteer, either because they do not know who these scientists are or because political considerations are given more weight than scientific qualifications” (p. 18). In other words: authors are selected from a “club” of scientists and nonscientists who agree with the alarmist perspective favored by politicians.
Too political…
The rewriting of the Summary for Policy Makers by politicians and environmental activists — a problem called out by global warming realists for many years, but with little apparent notice by the media or policymakers — was plainly admitted, perhaps for the first time by an organization in the “mainstream” of alarmist climate change thinking. “[M]any were concerned that reinterpretations of the assessment’s findings, suggested in the final Plenary, might be politically motivated,” the IAC auditors wrote. The scientists they interviewed commonly found the Synthesis Report “too political” (p. 25).
Really? Too political? We were told by everyone — environmentalists, reporters, politicians, even celebrities — that the IPCC reports were science, not politics. Now we are told that even the scientists involved in writing the reports — remember, they are all true believers in man-made global warming themselves — felt the summaries were “too political.”
Here is how the IAC described how the IPCC arrives at the “consensus of scientists”:
Plenary sessions to approve a Summary for Policy Makers last for several days and commonly end with an all-night meeting. Thus, the individuals with the most endurance or the countries that have large delegations can end up having the most influence on the report (p. 25).
How can such a process possibly be said to capture or represent the “true consensus of scientists”?
Phony estimates of certainty
Another problem documented by the IAC is the use of phony “confidence intervals” and estimates of “certainty” in the Summary for Policy Makers (pp. 27-34). Those of us who study the IPCC reports knew this was make-believe when we first saw it in 2007. Work by J. Scott Armstrong on the science of forecasting makes it clear that scientists cannot simply gather around a table and vote on how confident they are about some prediction, and then affix a number to it such as “80% confident.” Yet that is how the IPCC proceeds.
The IAC authors say it is “not an appropriate way to characterize uncertainty” (p. 34), a huge understatement. Unfortunately, the IAC authors recommend an equally fraudulent substitute, called “level of understanding scale,” which is more mush-mouth for “consensus.”
The IAC authors warn, also on page 34, that “conclusions will likely be stated so vaguely as to make them impossible to refute, and therefore statements of ‘very high confidence’ will have little substantive value.” Yes, but that doesn’t keep the media and environmental activists from citing them over and over again as “proof” that global warming is man-made and a crisis…even if that’s not really what the reports’ authors are saying.
IPCC participants had conflicts of interest
Finally, the IAC noted, “the lack of a conflict of interest and disclosure policy for IPCC leaders and Lead Authors was a concern raised by a number of individuals who were interviewed by the Committee or provided written input” as well as “the practice of scientists responsible for writing IPCC assessments reviewing their own work. The Committee did not investigate the basis of these claims, which is beyond the mandate of this review” (p. 46).
Too bad, because these are both big issues in light of recent revelations that a majority of the authors and contributors to some chapters of the IPCC reports are environmental activists, not scientists at all. That’s a structural problem with the IPCC that could dwarf the big problems already reported.
IPCC critics vindicated
So on June 27, nearly two years after these bombshells fell (without so much as a raised eyebrow by the mainstream media in the U.S. — go ahead and try Googling it), the IPCC admits that it was all true and promises to do better for its next report. Nothing to see here…keep on moving.
Well I say, hold on, there! The news release means that the IAC report was right. That, in turn, means that the first four IPCC reports were, in fact, unreliable. Not just “possibly flawed” or “could have been improved,” but likely to be wrong and even fraudulent.
It means that all of the “endorsements” of the climate consensus made by the world’s national academies of science — which invariably refer to the reports of the IPCC as their scientific basis — were based on false or unreliable data and therefore should be disregarded or revised. It means that the EPA’s “endangerment finding” — its claim that carbon dioxide is a pollutant and threat to human health — was wrong and should be overturned.
And what of the next IPCC report, due out in 2013 and 2014? The near-final drafts of that report have been circulating for months already. They were written by scientists chosen by politicians rather than on the basis of merit; many of them were reviewing their own work and were free to ignore the questions and comments of people with whom they disagree. Instead of “confidence,” we will get “level of understanding scales” that are just as meaningless.
And on this basis we should transform the world’s economy to run on breezes and sunbeams?
In 2010, we learned that much of what we thought we knew about global warming was compromised and probably false. On June 27, the culprits confessed and promised to do better. But where do we go to get our money back?
Related from this old college blog:
Inconvenient Questions Global Warming Alarmists Don’t Want You to Ask – February 18, 2007 – LINK
Top Scientists Say: You Are Not the Cause of Global Warming – October 22, 2007 – LINK
Global Cooling Continues; Global Warming Alarmists Still Issuing Death Threats – December 28, 2008 – LINK
UK Telegraph: 2008 was the year man-made global warming was disproved – December 28, 2008 – LINK
National Climatic Data Center: Cooling in Last 10 Years – January 10, 2009 – LINK
The Debate is Over. Global Warming Alarmism is About Achieving Central Control of the Economy and Now They Admit It Openly – March 27, 2009 – LINK
Al Gore: Climate change issue can lead to world government – July 11, 2009 – LINK
EPA Tried to Suppress Global Warming Report Admitting Skeptics Correct – October 23, 2009 – LINK
New AP Article on “Global Cooling Myth” Spins a Bad Study – UPDATED: Look where they put THIS ground station… – October 27, 2009 – LINK
Professors Paid to Plagiarize – UPDATE: Global warming scientists hacked emails show manipulation of data, hiding of other data and conspiring to attack/smear global warming skeptics! – November 19, 2009 – LINK
National Association of Scholars on the “ClimateGate” Scandal – November 28, 2009 – LINK
Examples of the “Climategate” Documents – UPDATE: BBC Had the emails and files for 6 weeks, sat on story. UPDATE II – They carried out their conspiracy threat; much of the raw data from CRU destroyed! – November 28, 2009 – LINK
Scientific American thinks you are stupid: The dissection of a blatant propaganda piece for global warming alarmism. – December 6, 2009 – LINK
The Roundup: IPCC Authors Now Admitting Fault – No Warming Since 1995 – Sea Levels Not Rising. Senator Inhofe: Possible criminal misuse of taxpayer research funds. – February 23, 2010 – LINK
OOPS AGAIN: IPCC scientists screeching about the cataclysmic effects of sea-level rises forgot to consider sedimentary deposits… – April 23, 2010 – LINK
UN IPCC Co-chair: climate policy is redistributing the world’s wealth – November 18, 2010 – LINK
More Hadley Center Global Warming Horror Claims Debunked by Real Science – December 6, 2010 – LINK
ClimateGate One Year Later. Elite Media Still Lying – December 6, 2010 – LINK
More ClimateGate One Year Later – December 7, 2010 – LINK
IPCC Lead Author Dr. Richard Lindzen of MIT: Most global warming models are exaggerated, many scientists in it for the grant money or treat it like a religion – December 7, 2010 – LINK
How Global Warming Propaganda Works – December 8, 2010 – LINK
NASA’s global warming evidence page filled with lies, half truths and suspect data – December 10, 2010 – LINK
Director of the Tyndall Centre for Climate Change Research: Halt economic growth, start government rationing. Global Warming Alarmists Party Fat in Cancun – December 21, 2010 – LINK
Global Warming Conference Delegates Sign Petitions to Ban Water and “Destabilize U.S. Economy” – February 15, 2011 – LINK
Global Warming Alarmist Quote of the Day – Former Canadian Environment Minister Christine Stewart: No matter if the science is all phony, there are collateral environmental benefits…climate change provides the greatest chance to bring about justice and equality in the world.
AAUP Seeks to Limit Transparency Over Climate Science – September 19, 2011 – LINK
[Editor’s Note: Obama has Jimmy Hoffa and Trumka out there trashing people, has the Congressional Black Caucus out there race bating, has MSNBC doctoring Rick Perry videos, all on HIS behalf and he comes out after yet another of his umpteen vacations saying that we need to rise above politics & we have to do this NOW NOW NOW; yet he has proposed no bill. He asks that the rich pay their “fair share” except for buddies Buffet, GE, and the others who earn income in ways that are exempted from the wage earner rate that he wants to raise.
He wants another half a trillion stimulus package, after he promised us that not one dime of the first one would be wasted and yet the billions of wasted dollars are still being tallied such as gay sex studies in South America, billions invested in solar panel companies that took the money and then vanished, billions into Chinese companies and make work projects for unions who give the Democrats kick backs.
What happened to the $2.5 trillion that was just handed to him in the so called budget ceiling increase deal he just got? What happened to ‘The stimulus is working we just need more time for it to work’, ‘recovery summer’ and all that?
WHAT Jobs Bill?? Is this another case that we have to pass the bill before we are allowed to see it? The last one that was passed like that had three multi-billion dollar slush funds hidden in it. No more.
Boehner: Here we are with an 1,100 pages that not one member has read this not one! When happened to the promise that we were going to let the American people see what was in this bill?!
Boehner goes nuclear when he finds out that language was illegally inserted into the bill at the last minute giving the AIG execs big bonuses with our money. You see they were big contributors to Senator Chris Dodd (D-CT)
Democrats break transparency promise again; Boehner chews out Henry Waxman for dropping a 300 page amendment to energy tax bill in the hopper at 3:09 am (so that no one could read it).
Obama claimed that his health care reform plan (now called Obamacare) would not allocate money for illegal immigrants.
According to Rep. Joe Wilson (R-SC), the Congressman who yelled out at Obama, nearly $8.5 million has been set aside for “seasonal farm workers.” Wilson says this group is made up of at least 25% illegal immigrants according to the Pew Research Center.
Now the Congressman says he was right. “It is clearly providing money that should be going to American citizens to illegal immigrants,” Rep. Wilson told FOX News today.
UPDATE – Even MORE Wild Hypocrisy – Remember this photo?
Remember how the left and the elite media had a collective conniption fit saying that Bush was “profiteering” from 9-11 and exploiting the tragedy for political gain (see links below in this update)? President Obama allowed Sony Corp to have exclusive access to the files of the Osama bin-Laden raid for their upcoming movie that they will be releasing 30 days before the election.
Bill Press of Tribune Media Services wrote: “… Bush’s selling of that third photo, taken on September 11, sets a new, disgusting low in political fund-raising.” – LINK
Remember how President Obama even dressed down the Supreme Court at the State of the Union Address over this issue?
Citizens United released a documentary critical of Hillary Clinton’s corrupt political and business dealings. One of those dealings involved ripping off Marvel Comics and film legend Stan Lee. Here is a short clip from that documentary:
The Democrats and the elite media had a collective cow blasting the Supreme Court on their decision to stand up for the First Amendment.
This is how far the left has gone folks. Once again they have resorted to just making stuff up out of thin air. Mathews claimed on his show that Rush Limbaugh said that we should reverse the reintegration of the military that happened at the end of WWII. Mathews is lying in the worst form of smear. It is no different when MSNBC made up the false quotes about Limbaugh when he was trying to buy an NFL team.
Audio and transcripts of every Rush Limbaugh show are posted online every day.
Keep in mind it was Democrats led by Woodrow Wilson that re-segregated the military after Republicans had integrated it. The NAACP before it was hijacked by the neo-marxist left, was a solidly Republican organization that formed largely in response to Wilson who was also known as “the first progressive president”.
This is indicative of what we will see in the upcoming campaign.
In the coming days we’ll sort through the repercussions of S&P’s downgrade of our credit rating, including concerns about the impact a potential interest rate increase would have on our ability to service our suffocating $14.5 trillion debt.
I’m surprised that so many people seem surprised by S&P’s decision. Weren’t people paying attention over the last year or so when we were getting warning after warning from various credit rating agencies that this was coming? I’ve been writing and speaking about it myself for quite some time.
Back in December 2010,I wrote: “If the European debt crisis teaches us anything, it’s that tomorrow always comes. Sooner or later, the markets will expect us to settle the bill for the enormous Obama-Pelosi-Reid spending binge. We’ve already been warned by the credit ratings agency Moody’s that unless we get serious about reducing our deficit, we may face a downgrade of our credit rating.” And again in January, in response to President Obama’s State of the Union address I wrote: “With credit ratings agency Moody’s warning us that the federal government must reverse the rapid growth of national debt or face losing our triple-A rating, keep in mind that a nation doesn’t look so ‘great’ when its credit rating is in tatters.”
One doesn’t need a Harvard Law degree to figure this out! Just look across the pond at Europe. European nations with less debt and smaller deficits than ours and with real “austerity” plans in place to deal with them have had their ratings downgraded. By what magical thinking did we figure we could run up perpetual trillion dollar deficits and still somehow avoid the unforgiving mathematics of a downgrade? Nothing is ever “too big to fail.” And there’s no such thing as a free lunch. Didn’t we all learn that in our micro and macro econ classes? I did at the University of Idaho. How could Obama skip through Columbia and Harvard without learning that?
Many commonsense Americans like myself saw this day coming. In fact, in June 2010, Rick Santelli articulated the view of independent Tea Party patriots everywhere when he shouted on CNBC, “I want the government to stop spending! Stop spending! Stop spending! Stop spending! STOP SPENDING!” So, how shamelessly cynical and dishonest must one be to blame this inevitable downgrade on the very people who have been shouting all along “stop spending”? Blaming the Tea Party for our credit downgrade is akin to Nero blaming the Christians for burning Rome. Tea Party Americans weren’t the ones “fiddling” while our country’s fiscal house was going up in smoke. In fact, we commonsense fiscal conservatives were the ones grabbing for the extinguishers while politically correct politicians and their cronies buried their heads in what soon became this bonfire.
With S&P and others now warning that we could face another downgrade if we don’t get serious about our debt problem (i.e., recklessly spending money we don’t have), Washington needs to wake upbefore things get worse! We’re already hearing murmurs about QE3, which is just madness and will further debase our currency at a time when the dollar’s status as the world’s reserve currency is already being questioned. The loss of the dollar’s reserve currency status would adversely impact us in every conceivable way. Our standard of living would decline as imports become more expensive (including imports of foreign oil), government wouldn’t be able to finance deficits as cheaply, and American corporations – employers – would lose a competitive edge. It would be another crack in our status as a financial superpower.
Now we’re all getting hit with rising food prices too. Back in November of last year, I predicted this would happen when the Federal Reserve dropped a $600 billion money bomb called QE2 on us! That’s short for “quantitative easing 2.” It’s a fancy term for running the printing presses and creating money out of thin air – which drives down the value of the dollar and makes the price of everything more expensive.
As I predicted six months ago, these policies will lead us down a path where for the first time in our history our fate will be taken out of our own hands and placed in the hands of the world’s capital markets. They will force us to make the responsible decisions that our leaders are unwilling to make. Just as the destinies of the Central Valley farms have been taken out of your hands by the federal government’s overreach into your water rights, so the destiny of our nation will be taken out of our hands because our leadership has failed to get our financial house in order.
This isn’t some theoretical threat any more. It’s already happening. The world’s biggest bond investment fund PIMCO announced last month that it was dumping U.S. Treasury bonds. The head of PIMCO, Bill Gross, one of the world’s preeminent debt investors, warned that the U.S. is in serious risk of default with our trillion dollar deficits and no end in sight. And last week, credit rating agency Standard & Poor’s downgraded our credit outlook to “negative” – that’s the first time that has happened to us since the attack on Pearl Harbor. The IMF has even given us formal notice that, unless we do something to deal with our debt problem, we could tip the world economy into another recession.
It is a disgraceful and embarrassing situation when the United States finds itself justifiably chastised in the same tone normally reserved for near-bankrupt economies.
And in this, like in shutting off your water, the federal government has failed you. Their reckless spending and destruction of the dollar will make access to available credit for farmers and small business owners harder to get. And it will make transportation costs higher because it will hit everyone at the gas pump. You see, because the Obama White House won’t let us drill domestically, we’re forced to import oil that we pay for in dollars. So, when the value of the dollar drops, the price of gas goes up. And if you think $4 a gallon is bad, wait till you see what life is like at $6 or $7 a gallon.
Last November, the so-called smart people all laughed at me when I warned them of this. They told me not to make such a big deal about rising prices. Well, guess what – it became a big deal all on its own.
In fact, there was an editorial in the New York Sun that said – and I quote: “As gasoline is nearing six dollars a gallon at some pumps, the cost of groceries is skyrocketing, and the value of the dollars…has collapsed to less than a 1,500th of an ounce of gold. Unemployment is still high. Shakespeare couldn’t come up with a better plot. But how in the world did Mrs. Palin, who is supposed to be so thick, manage to figure all this out so far ahead of the New York Times and all the economists it talked to?”
Well, I’m sure the New York Times writers will remember the famous line: “You don’t need a weatherman to know which way the wind blows.” And right now the American economy is in the howling, hot headwinds of a gathering storm. We’re printing up and buying up our own notes at an unprecedented rate, and the Fed is artificially holding interest rates down to nearly zero. Anyone with commonsense could see what was coming. Unfortunately, common sense is in short supply among our leaders. It’s like they never believe that the rules of common sense apply to them. They think somehow we’ll escape from the consequences of their policies. It’s the same magical thinking that allows them to run up trillion dollar deficits and still think that we can “win the future.”
Every other generation has weathered recessions by sacrifice and belt tightening. But our leaders today decided that they could magically paper over the tough decisions by running the printing presses. A little history lesson might have showed them how well that worked out for Germany in the 1930s. The Weimar Republic inflated its currency so much that it took a wheel barrel full of paper money to buy a loaf of bread. That might be the main thing I remember from Mr. Crum’s history class at Wasilla High, but it told me all I needed to know about the inflationary dangers of a weak currency and why we must avoid it. What a shame Mr. Crum didn’t teach at Harvard.
That was just three months ago, and things have already gotten worse. We have to face this storm head on. It won’t be easy, but there are real solutions to grow our economy and reduce our debt.
First, we need to get serious about our deficit. No more accounting gimmicks. No more cuts in “out-years” that never materialize. The permanent political class in D.C. might be fooling themselves with these Enron-like accounting games, but they’re not fooling the world’s capital markets. And we don’t need any more happy talk from the White House about “investing” in solar shingles and really fast trains. The White House shouldn’t even bother floating these new spending programs. We can’t afford them. Period. We need to stop this deficit spending, balance our budget, repeal Obamacare, cancel all unused stimulus funds, and reform our entitlement programs. We have to have an adult conversation about our spending commitments; circumstances have changed, and we must adapt. I know none of this will be easy, but, “thick” or not, the average American outside the D.C. politico bubble knows that we no longer have a choice! We will have entitlement reform and a balanced budget; it’s just a matter of how. We can do it ourselves in a calm, methodical, and responsible manner, or we can wait for the world’s capital markets to ram it down on us. Let’s be responsible and do it ourselves. And let’s get serious about reducing the size of government across the board and rooting out waste. How many more reports (that today are destined to merely gather dust on the shelf) do we need about duplicative and unnecessary programs before we actually do something about government waste?
We need to get this economy moving again, and the real stimulus we’ve been waiting for is domestic energy development. We must reduce our dangerous dependence on foreign oil by responsibly developing natural resources here. This will provide good paying jobs, reduce our trade deficit, increase federal and state revenue, ensure environmental standards, and actually stimulate our economy without incurring any debt. That’s real stimulus! Affordable, plentiful, and secure energy is the foundation of every thriving economy. Let’s make it the foundation of ours. Let’s do the opposite of President Obama’s manipulation of U.S. energy supplies. Let’s drill here, build refineries, and stop kowtowing to foreign countries in asking them to ramp up energy production which makes us even more beholden to them as we rely on their foreign product. Let’s move on tapping our massive domestic natural gas reserves. Natural gas is the perfect “bridge fuel” to a future when more renewable sources are available. It’s clean, it’s green, and we’ve got a lot of it. Let’s drill. Let’s build an infrastructure for natural gas cars and power plants. Energy development can help kick start our economic engine.
In addition to energy security, I embrace a pro-growth agenda that can make American corporations far more competitive on the global stage. (I will be writing more about this in the coming days.) We need to tell the world, “America is open for business again!” And let’s welcome industry by reducing burdensome regulations. The Obama administration keeps strangling businesses in red tape. From the EPA’s rulings to that nightmare known as Obamacare, the Obama administration is hanging one regulatory albatross after another around the private sector’s neck. Let’s get government out of the way and give the private sector room to breathe, grow, and thrive. We can provide businesses confidence to expand and hire Americans in a stable environment.
Be wary of the efforts President Obama makes to “fix” the debt problem. The more he tries to “fix” things, the worse they get because his “solutions” always involve spending more, taxing more, growing government, and increasing debt. This debt problem is the greatest challenge facing our country today. Obviously, President Obama doesn’t have a plan or even a notion of how to deal with it. His press conference today was just a rehash of his old talking points and finger-pointing. That’s why he can’t be re-elected in 2012.
Our economic news is disheartening and the task before us can seem daunting, but we must not lose our sense of optimism. People look around today and may see only the negative. They see a culture and a nation in decline, but that’s not who we are! America must regain its optimistic pioneering spirit again. Our founders declared that “we were born the heirs of freedom.” We are the heirs of those who froze with Washington at Valley Forge, who held the line at Gettysburg, who freed the slaves, carved a nation out of the wilderness, and allowed reward for work ethic. We are the sons and daughters of that Greatest Generation who stormed the beaches of Normandy, raised the flag at Iwo Jima, and made America the strongest and most prosperous nation in the history of mankind. By God, we will not squander what has been given us!
Our destiny is still in our own hands if we pick ourselves up and act responsibly and quickly. We must all get involved. Concerned Americans must seek truth, work harder than ever, and be willing to sacrifice today to ensure freedom tomorrow. Please get engaged in 2012 electoral politics and support experienced, vetted, pro-free market fiscal conservatives who will dedicate all to preserving our Republic and protecting our Constitution.
Mr. Walter Smith included me in his list of email recipients. Here is an excerpt.
“Does any one know Lloyd Marcus?
“Since when did African Americans become so equal that they could afford to support groups that are obviously anti-Black. Does he not know that a vote against Barack Obama is a vote against all African Americans?”
Dear Mr. Smith:
I usually delete hate mail from the left. Because your email did not begin with the typical calling me numerous expletives and the “n” word, I will reply.
I find it amazing how blind you are regarding YOUR racism. You call millions of Americans, many who voted for Obama, “obviously anti-Black” because they disapprove of his socialistic agenda . So, because we have a black president, any and all criticism is automatically deemed to be racist. Last time I checked, this is still America where folks have a right to disagree regardless of the president’s skin color.
In response to your statement: “Does he not know that a vote against Barack Obama is a vote against all African Americans?”
Good lord Mr. Smith, not only is this statement absurd, it is evil. You are instructing black Americans not to consider who Obama is as a human being. According to you, Obama’s values, principles and vision for America are irrelevant.
In essence, you are saying Obama’s skin color MUST trump EVERYTHING! Can you not see the immorality of such thinking? What if white America followed your lead. “If you do not vote for the white guy, you are voting against all white Americans.” Only a white skin head would make such an idiotic, evil proclamation.
But then, you probably do not consider black racism to be immoral. I suspect you view America’s sin of slavery, a ga-zillion years ago, as a gold credit card entitling blacks to limitless acts of racism.
Mr Smith, over 50% of black babies are aborted which Obama supports via Planned Parenthood. Obama supports gay marriage. Black unemployment has risen to an unprecedented high under Obama.
As a Christian, Obama’s agenda does not “jive” with my values. You are insisting that I worship Obama’s skin color over my God. I will not.
UPDATE II – Bachmann calls for Tim Geithner’s resignation:
This will affect you.
Moody’s said it was going to hold off for a while but after this they may follow suit.
Unsecured credit will be more expensive. This means those who use short-term loans such as farmers, import/exporters etc will pay more. It means that interest the USA pays on the debt will go up, costing up to $110 billion a year and there will be other impacts.
[Note: This was released late on a Friday night. Releasing at this time skips the weekday news cycle and my Monday there will be other big news to report. As a result most people will not see this in the news therefore it will have less of an effect on Obama.]
· We have lowered our long-term sovereign credit rating on the United States of America to ‘AA+’ from ‘AAA’ and affirmed the ‘A-1+’ short-term rating.
· We have also removed both the short- and long-term ratings from CreditWatch negative.
· The downgrade reflects our opinion that the fiscal consolidation plan that Congress and the Administration recently agreed to falls short of what, in our view, would be necessary to stabilize the government’s medium-term debt dynamics. · More broadly, the downgrade reflects our view that the effectiveness, stability, and predictability of American policymaking and political institutions have weakened at a time of ongoing fiscal and economic challenges to a degree more than we envisioned when we assigned a negative outlook to the rating on April 18, 2011.
· Since then, we have changed our view of the difficulties in bridging the gulf between the political parties over fiscal policy, which makes us pessimistic about the capacity of Congress and the Administration to be able to leverage their agreement this week into a broader fiscal consolidation plan that stabilizes the government’s debt dynamics any time soon.
· The outlook on the long-term rating is negative. We could lower the long-term rating to ‘AA’ within the next two years if we see that less reduction in spending than agreed to, higher interest rates, or new fiscal pressures during the period result in a higher general government debt trajectory than we currently assume in our base case.
The message is clear, the cuts are not good enough, and if we spend more than the current cuts (which are actually not cuts at all but planned decreases in the increase of spending) we will get lowered again. As IUSB Vision readers are well aware, we have a history of enacting spending cuts down the road that are reversed by a later Congress.
Our revised downside scenario–which, other things being equal, we view as being consistent with a possible further downgrade to a ‘AA’ long-term rating–features less-favorable macroeconomic assumptions, as outlined below and also assumes that the second round of spending cuts (at least $1.2 trillion) that the act calls for does not occur.
Expect Democrats to read the first point and say, “See it fell short because we did not increase taxes” but as you can see point five makes it crystal clear. S&P is not threatening our rating if tax rates drop or stay the same, they are threatening to lower us again if we spend more than we say.
We must not forget that the Democrats rejected every that had a real shot of preserving AAA. This latest calamity is very solidly in the Democrats responsibility. I know that leftist partisans will reject that fact, but to them I ask, what plan did the Democrats put up that had a shot of preserving AAA? The Democrats did not put up even one plan that would bring us to the point where we just stopped having yearly deficits even ten years down the road.
Granted the GOP could have fought for a slightly better deal, but the government cannot be controlled from just one House of Congress. This is why elections matter.
The S&P Report linked in the PDF above continues to say that there have only been modest reductions in intended discretionary spending and that the real problems of Medicare and other entitlements have not been addressed. The GOP has put forward a plan that will work, the Democrats have been promising to come out with an entitlement reform plan but have reneged.
We lowered our long-term rating on the U.S. because we believe that the prolonged controversy over raising the statutory debt ceiling and the related fiscal policy debate indicate that further near-term progress containing the growth in public spending, especially on entitlements, or on reaching an agreement on raising revenues is less likely than we previously assumed and will remain a contentious and fitful process. We also believe that the fiscal consolidation plan that Congress and the Administration agreed to this week falls short of the amount that we believe is necessary to stabilize the general government debt burden by the middle of the decade.
Analysts say that, over time, the downgrade could push up borrowing costs for the U.S. government, costing taxpayers tens of billions of dollars a year. It could also drive up interest rates for consumers and companies seeking mortgages, credit cards and business loans.
A downgrade could also have a cascading series of effects on states and localities, including nearly all of those in the Washington metro area. These governments could lose their AAA credit ratings as well, potentially raising the cost of borrowing for schools, roads and parks.
UPDATE – Here are the talking points from the NYT and Paul Krugman in reaction to this. Quite frankly their response is a joke and is designed to fool people who are not trained in economics.
It was S&P that had Lehman Brothers rated AAA just a month before they went bankrupt.
The truth: the overwhelming majority thought that the Fannie Mae/Freddie Mac junk paper and the credit default swaps that insured them were backed up by the US Government, and they were, as this was what most of the bailouts were about, but the government decided to pick winners and losers as to who would get bailed out and who would not.
AIG got bailed out in large part so that it could pay Goldman Sachs who it owed a massive amount of cash. Lehmen Brothers did not get bailed out, by and large because they were Goldman Sachs biggest competitor. All too often Bank A would apply for bailout and so would Bank B; Bank B would get bought out by Bank A using TARP funds and then Bank A would give a large donation to ACORN or another Democrat ally.
This is why so many smaller banks got bailout while Lehman Bros was allowed to collapse arbitrarily and capriciously.
It was S&P that rated AIG’s credit default swaps as rock solid investments.
The truth: and the US Govt bailed them out and the credit default swaps were paid, just as almost everyone expected would happen, so yes indeed they were pretty solid, they got overextended and the claims could not be paid, so you and I paid them and the Goldman Sachs of the world made megabucks.
Of course, if Fannie Mae had not engaged in the behavior it did; buying high risk loans, pushing banks to issue more high risk loans, issuing junk investments based on those loans, and long term massive internal corruption, all while it was being given total cover by Barney Frank, Chris Dodd, and Barack Obama and Paul Krugman defended them with the zeal of a defense attorney.
The Democrats Financial Regulation Bill doubled down and reimplemented the exact same government policies that started the ball rolling towards mortgage collapse in the first place, e.g. the government forcing banks to give out high risk loans in inner cities. Paul Krugman supported that legislation and this policy and does to this day.
It was S&P that admitted to making a $2 trillion accounting error (remember, playing with numbers is their core business and reason for being) in advance of the downgrade of U.S. debt.
The truth: and the Dept. of Education has lost over a billion dollars and has no idea where it went, all in all this adds up to a colossal “so what” as is explained further below.
A downgrade in U.S. debt means functionally that U.S. treasury bills are, in S&P’s oh-so-wise opinion, less trustworthy and a greater credit risk to investors. This comes only a day after investors fled the DOW and S&P500 into the safe and waiting hands of…you guessed it: U.S. treasuries. The same treasuries that S&P suddenly finds a more dangerous buy. So what does that say about the stock market, and the S&P500? Perhaps S&P might wish to re-evaluate the credibility of its own market index.
The truth: with every plan to lead to a balanced budget rejected by Democrats for as long as the eye can see, it is a crystal clear message that the government, as long as Democrats are in power, has no intention to pay off the debt, ever. If you don’t think that this makes our Treasury Bills less secure than you are likely smoking something you shouldn’t be.
History has shown that when a nation’s deficits exceed 100% of GDP its currency and credit have a rapid collapse. It happened to Greece as it approached 120% of GDP. It is predicted that it will soon happen to Spain. If you think it cannot happen here please see the previous paragraph.
None of the other ratings agencies are taking the drastic step that S&P has. S&P is all alone in their move to downgrade U.S. credit.
The truth: There is nothing drastic about it, both S&P and Moodys have warned since 2009 that this would happen if the United States continued to burrow like this. They both put out warning after warning. I have written about those warnings and so has the elite media. Moody’s will likely follow suit in a matter of months. Mini-UPDATE – This talking point is a LIE. Egan-Jones Rating Agency downgraded the USA to AA+ on July 16, 2011.
When all is said and done, U.S. treasuries are still the safest investment in the world, and it would take either an idiot or someone with a strong political agenda to contend otherwise.
The truth: and that is why so many countries are dumping our debt and buying Gold, Euros, oil futures, etc. Why? The economic policy the Democrats and the Federal Reserve is following reduces the value of the dollar so that the dollars we pay back are worth far far less than the dollars the government burrowed.
The investments are safe IF you consider the mass printing of money to pay those bills and service the debt to be just fine. What good is a 4% interest long-term T-Bill when the dollar loses twice that plus in inflation/devaluing?
As is often the case Paul Krugman’s talking points that are nothing but a pack of mostly irrelevant half-truths (read lies as half-truths are just lies designed to paint a false picture).
Lastly, it does not matter what you or Paul Krugman things of S&P and Moodys. Slandering them will not change the fact that the interest we pay on debt will go up, local governments will see a major impact, those who use unsecured debt such as seasonal loans for farmers, import/exporters etc will have to pay more and the credit markets will freeze up even worse than they are now. All of this will cause inflation that impacts the poor the most.
It has been well reported that the markets have expected this and have been bracing for it for months so that the impact would not be as immediate, but even the markets meltdown of the last 10 days is an indicator as the market has not behaved like it has of late since Jimmy Carter.
UPDATE III – Rick Santelli understands basic economics, Ezra Klein does not (what a shock). Listen to what Ezra Klein calls for policy wise. Did you catch it?
UPDATE V: The latest spin and talking points from the left as of Saturday, August 6.
It amazes me how dishonest the far left will go to paint a false picture. The latest tactic is to snip out every instance of revenue from the S&P report and present it as if the credit rating was lowered because the GOP would not raise taxes.
In essence this is the leftists case –
Blaming the Republicans (Tea Party):
“We lowered our long-term rating on the U.S. because we believe that the prolonged controversy over raising the statutory debt ceiling and the related fiscal policy debate indicate that further near-term progress containing the growth in public spending, especially on entitlements, or on reaching an agreement on raising revenues is less likely than we previously assumed and will remain a contentious and fitful process.”
“The political brinksmanship of recent months highlights what we see as America’s governance and policymaking becoming less stable, less effective, and less predictable than what we previously believed.”
Tax Increases Needed:
“It appears that for now, new revenues have dropped down on the menu of policy options.”
“The act contains no measures to raise taxes or otherwise enhance revenues, though the committee could recommend them.”
“..if the recommendations of the Congressional Joint Select Committee on Deficit Reduction–independently or coupled with other initiatives, such as the lapsing of the 2001 and 2003 tax cuts for high earners–“
Here are a couple of opinion pieces in the elite media taking that spin:
Is the U.S. Credit Rating a Victim of GOP Sabotage? – http://finance.yahoo.com/blogs/daniel-gross/u-credit-rating-victim-gop-sabotage-021622372.html
First of all, the attempt to spin the S&P report as a slam on the GOP is debunked by the text of the report itself:
Standard & Poor’s takes no position on the mix of spending and revenue measures that Congress and the Administration might conclude is appropriate for putting the U.S.’s finances on a sustainable footing.
Second, S&P uses the word revenue several times in the report, but in context they make it clear that what they want to see is a plan that cuts spending with the cuts actually happening, and any revenue enhancing plan actually enhance revenue. Here is the rub, when non-partisan economic realists use the word revenue, this does not always means raising tax rates on wage earners and small businesses as the Democrats define it. There are a number of ways to raise revenue. For example when Bill Clinton signed off on the Newt Gingrich/John Kasich budgets in the late 1990’s this included a temporary reduction in the capital gains tax rate.
In 1997, the Republican Congress passed a tax-relief and deficit-reduction bill that was resisted but ultimately signed by President Clinton. The legislation:
Lowered the top capital gains tax rate from 28 percent to 20 percent
Created a new $500 child tax credit
Phased in an increase in the estate tax exemption from $600,000 to $1 million
And we all know what happened, government revenues shot up in a big way and we actually had a deficit free year.
President Bush and the GOP used this same strategy to increase revenue after the Clinton/Gingrich/Kasich capital gains tax cut expired.
Reducing the capital gains tax rate from 20% to 15% increased capital gains tax receipts by 79% from 2000 to 2004. Cutting the dividend tax rate by more than half–from 39.6% to 15%–increased dividend tax receipts by 35% from 2002 to 2004. And corporate tax receipts have nearly tripled since 2003, reaching $250 billion for the past nine months, 26% higher than the same period last year. (WSJ July 25, 2006)
———
For anyone willing to read it, the January 2007 Congressional Budget Office annual report settles any debate. Citing the original CBO forecasts of capital gains tax revenue of $42 billion in 2003, $46 billion in 2004, $52 billion in 2005, and $57 billion in 2006, Democrats who opposed the rate reduction in 2003 claimed that the capital gains tax cut would “cost” the federal treasury $5.4 billion in fiscal years 2003-2006.
Those forecasts were embarrassingly wrong. The 2007 CBO report revealed that capital gains and dividends tax collections were actually $51 billion in 2003, $72 billion in 2004, $97 billion in 2005, and $110 billion in 2006, the last two years nearly doubling initial forecasts.
In other words, forecasts in earlier CBO reports were low by a total of $133 billion for the four-year period. (Am Thinker September 11, 2010)
By lowering the rate we increased the revenue. Why is that?
It is the same reason that the Obama Deficit Commission, which was totally ignored by the Democrats, said that the best way to increase revenue is to lower the tax rates, including the corporate tax rate, make the progressive taxes flatter, reform the tax code so that it is easier and less expensive to comply with. Their reasoning is simple, the expense of compliance causes people to resist the tax code, or to often avoid taking action that will be taxable. High tax rates encourage people who have disposable assets/income to just park their money in such a way that it is not taxed. The money just sits there, or is invested in gold, or in China, or is sheltered. This is why “tax the rich schemes” actually transfer the tax burden to the lower middle class and accomplish exactly the opposite of their stated intent. For explanations in great detail of why that is examine the following LINK. Also the tax increase plan put forth by the administration does not target the millionaires and billionaires hardly at all, but guess who it will impact the hardest – LINK?
There are two more ways that this report has been spun. They quote this section of the report on page four:
Our revised upside scenario–which, other things being equal, we view as consistent with the outlook on the ‘AA+’ long-term rating being revised to stable–retains these same macroeconomic assumptions. In addition, it incorporates $950 billion of new revenues on the assumption that the 2001 and 2003 tax cuts for high earners lapse from 2013 onwards, as the Administration is advocating.
But here is what the left leaves out; immediately above those lines it says the following:
Key macroeconomic assumptions in the base case scenario include trend real GDP growth of 3% and consumer price inflation near 2% annually over the decade.
So what does that mean in English? It means that IF we have a REAL GDP growth of 3% steady and inflation stays below 2% a tax increase can work. But you see that is the problem, those are BIG ifs. Real GDP growth is under 2% and close to 1% in the private sector. Inflation, when measured with the same formula that was used under Carter/Reagan is at almost 10%. This figure also assumes that growth will not be impacted by such a tax increase, and since small businesses and upper middle class wage earners would get hit hardest by the Administration’s proposed tax increase (as we demonstrated above) the impact on economic growth would be substantial.
Some, like the economically incompetent and flamboyantly partisan Daniel Gross who writes in the Yahoo Finance column linked above, simply engage in the most dishonest demagoguery imaginable:
It has long been obvious to all observers — to economists, to politicians, to anti-deficit groups, to the ratings agencies — that closing fiscal gaps will require tax increases, or the closure of big tax loopholes, or significant tax reform that will raise significantly larger sums of tax revenue than the system does now. Today, taxes as a percentage of GDP are at historic lows. Marginal rates on income and investments are at historic lows. Corporate tax receipts as a percentage of GDP are at historic lows. Perhaps taxes don’t need to rise this year or next, but they do need to go up in the future.
Otherwise, the math of deficit reduction simply doesn’t work. And that’s how the deficit reduction deals signed off on by Republican presidents like Ronald Reagan and George H.W. Bush came about.
Yet the action in Washington in the past year has all gone in the opposite direction. President Obama deserves some of the blame. Several months ago, he struck a deal with Congress to make the fiscal situation worse — extending the Bush tax cuts for two more years and enacting a temporary cut in the payroll tax.
Wow it sounds horrible doesn’t it? Can we just tax ourselves into prosperity or is there something missing from Mr. Gross’ assessment?
Today, taxes as a percentage of GDP are at historic lows
That is because government spending as a percentage of GDP is at historic highs. The way that GDP is calculated the formula (which is greatly flawed but that subject is a 40 page term paper) adds governments spending to all private sector consumer, investment, exports minus imports, and capital goods spending – so when government spending goes up by 80% and the tax rates stay the same the percentage of the tax rate to GDP drops. If you simply compare the private sector part of the equation to how much is taxed that paints quite the opposite picture. So in essence, the more the government prints, burrows and spends, the lower it pushes that tax to GDP ratio. In 2007 the yearly deficit was a measly 198 billion, whereas last year just the yearly deficit approached $2 trillion – an increase by a factor of 10. 2010 YEARLY DEFICIT: $2.08 Trillion. That is 10 times higher than the last year Republicans had budgetary control.
Marginal rates on income and investments are at historic lows.
In the 1950’s the top marginal tax rate was 90% and after 1964 the trop marginal rate was lowered to 70% by JFK. So this appears to be true, or is it? Here is what he forgot to tell you. Back in those days almost every transaction was a cash transaction. It is very easy to keep cash transactions off the books and they did not have computers tracking things like we have today. The simple fact is that there was massive tax noncompliance. If you were going to have to pay 90% tax on doing a business transaction why would you do it? People just cheated and did not report many of their transactions. Much of the private sector did this as a matter of survival to stay competitive. The fact is that we pay much more now than we did before because compliance is much higher than it was back then. Also Mr. Gross looks at only two taxes, the wage rate and the capital gains rate, but how many other taxes are there now which we did not have back then? There are hundreds of smaller other taxes now of phones, internet, etc and this list could go on forever. There is a great deal of direct inflation cause by being taxed right and left.
And speaking of that capital gains tax, which we showed you before that actually takes in more money as the rate is lowered; China has zero capital gains tax because they see it as a disincentive to engage in economic activity. China has been enjoying 9% plus GDP growth for some time now and they buy much of our debt.
Corporate tax receipts as a percentage of GDP are at historic lows
Also keep in mind that Canada and Japan have recently lowered their corporate tax rates to attract business back home. When Ireland lowered its corporate tax rates they attracted a lot of companies to set up shop there and their revenue went way up. Higher taxes on businesses cause businesses to either go out of business or flee the country. When companies decide to stop being American companies the tax from them vanishes. The more you tax corporations, the more will leave, the less money you will get and the more unemployed you will have. Never forget that when corporations have to pay high taxes, they simply raise the price of their product to cover it so it is YOU that pays. A high corporate tax simply inflates prices and makes the corporation the tax collector for the state.
But just for good measure:
One place it (the “unexpected” revenue) has come from are corporations, whose tax collections have climbed by 76% over the past two years thanks to greater profitability. Personal income tax payments are up by 30.3% since 2004 too, despite the fact that the highest tax rate is down to 35% from 39.6%. The IRS tax-return data just released last month indicates that a near-record 37% of those income tax payments are received from the top 1% of earners — “the rich,” who are derided regularly in Washington for not paying their “fair share.” (WSJ Oct. 6 2006) – The rich paid more in real dollars after the tax cuts.
Please forgive the lack of updates as I described in our previous post we have not been in a position to do a lot of blogging lately. A new web site is coming as well for the editor.
As far as the budget deal we thought we have a few comments.
1 – We were never in danger of a default. The government brings in almost 200 billion a month in tax dollars which is more than enough to service the debt. Anyone who said that the August 2nd date would result in default is just lying straight up. Judging by how the elite media has been repeating this it furthers my personal observation that journalists are lazy and are, as a collective, the most uninformed people I have ever encountered.
2 – These polls that you here about in the news saying that the people want “republicans to compromise” are polls like the CBS News poll that had a sample which included only 25% Republicans, so the sample was rigged. Notice how the Democrats are not asked to compromise in the press? When the people were stone against Obama Care by a 60% margin where was the press pounding the polls than? Where was the compromise when the Democrats would not allow the GOP into the room and would only see the bill a few hours before a vote?
3 – “Reagan increased the debt limit”… Reagan did not have a House controlled by his own party. During that time we had the 24/7 nuclear triangle operating at the pinnacle of the Cold War and a government shut down at such a time would have undermined our efforts to posture and beat the Soviets.
4 – “We need to raise taxes on the rich”. First of all we have been “raising taxes on the rich” for decades now so why is it that John Kerry paid 12.34% on $5,072,000 worth of income? The dirty little secret is that the tax rate that the Democrats are talking about is the wage earner rate which is paid by high-end wage earners such as doctors and engineers, but it is also the rate paid by most small businesses that have employees. Most of the income that the “rich” bring is defined by the tax code as “unearned income”, so you could raise this tax rate to the moon and the multimillionaires and billionaires will laugh as it will not be they who pay it. For more details on why this is follow this LINK.
Using static models as the CBO likes to use the Democrats proposed tax increase would pay for all of 10 days of deficit spending. Of course since people do not operate in a static universe the result would be an impact on job creators and even less revenue growth to the government. Can anyone name a mainstream economic theorist who said to raise taxes during what appears to be a double dip recession?
4 – As far as spending cuts in the “deal”, we must remember base line budgeting. If we froze spending at current levels Washington would consider that to be a $9.5 trillion dollar “cut”, so all we are talking about here is a small reduction in the typical increases in spending. As far as spending cuts are concerned this is not a serious plan as spending under this deal will continue to skyrocket. Democrats and some leftist journalists are calling these “draconian cuts” and are simply engaging in the most dishonest demagoguery imaginable.
5 – But here is the rub, when we lose our AAA credit rating, which now appears unavoidable as both Moodys and S&P have said that neither the Boehner plan nor the Reid plan are serious about getting spending under control, it will cost us more than $100 billion a year in interest alone; when that is factored in there are no reductions even in the increases in spending. It gets worse. When you add the damage to the economy that loss of AAA will bring it makes all of this worse.
The loss of AAA will impact most unsecured credit, it will impact the value of the dollar (inflation), it will impact those who use short-term credit such as farmers who use seasonal loans and import/export businesses. It is going to damage the economy in such a way that most people will feel it. We did not lose AAA even during the great depression. The “deal” which passed is also easy to demagogue because the left will say that this deal IS the “Boehner Plan” (which is largely isn’t any more do to an almost total cave on spending cuts) and HIS plan caused us to lose AAA.
[Note: The first plans that were introduced by the Tea Party/GOP were much more serious and had a real chance of preventing the loss of AAA. While this is indeed a failure of government, is there any doubt that the Democratic Party is intent on blowing up our credit rating? The first proposals from the House had a chance of preserving AAA and the media/Democrats had a conniption fit calling called it extreme. Think about this folks, preserving AAA is now an extreme position according to much of the elite media and a political party. The Constitution does have limits and the GOP cannot run the government from the House. This is why elections matter.]
6 – The deal also includes a vote on the Balanced Budget Amendment to send it to the states. If this amendment resolution passes the Democrat controlled Senate and gets to the states it will be a great tool to begin to get this spending problem under control. If it looks like it will pass the Senate I expect the Democrat leadership will pull some stunt prevent the vote or prevent its passage. Government has a structural institutional incentive to spend more and more, so the only way to curb that is to make a structural change. Aside from a vote on this Amendment, which I will stress has not happened yet, this was not a tough deal or a Herculean compromise by any stretch.
This is a must see exchange between Marco Rubio and John Kerry on the debt limit debate. Be sure to watch every second as this is invaluable.
Kerry will think twice before trying to posture Marco Rubio again. Notice also, even though Rubio did not join the TEA Party Caucus he defends their position, which is to offer a plan that fixes the problem. Rubio uses a most interesting analogy to show why this is so important.
UPDATE – The latest version of the deal includes $2.1 Trillion in cuts over 10 years with half planned now and the other half planned by a “budget cut committee later”. Keep in mind that cuts in “Washington Speak” are not cuts, but rather a decrease in the increase in spending. So instead of a planned increase in spending over 10 years of $9.5 Trillion they will plan to increase spending by $7.4 trillion. The president gets his debt increase limit extended to well passed the campaign, deficit spending shoots up, no entitlement reform, no plan to balance the budget over the next eight years. There are some actual small cuts in discretionary spending, but entitlement spending that is on autopilot. Of course even this is a fraction of the increase in discretionary spending that has gone up since 2008.
Bill Whiddle, who is as solid and bright as any communications strategist I have ever seen, in the video below gives us a great refresher in advertising techniques, branding, political messaging, and what he calls “iconography”. The best modern text on this very subject comes from author David Kupellian in his book The Marketing of Evil.
Let me give you an example of what is meant by iconography.
The Nazi Brand:
We all know what the Nazi Swastika is. Today it represents the kind of leviathan state evil that resulted in the murder of millions. It is important to keep in mind that the perception of the Swastika icon or brand was not always so negative. In the 1930’s Hitler was the darling of a large portion of American leftist academia, the media and many leftist political groups. For several years until Hitler took the rest of the Czechoslovakia after being handed the Czech Sudetenlands his brand was largely respected by large groups of people. For years Hitler and Mussolini were treated as brilliant visionaries who had discovered a “third way” as it were.
A brand can have its meaning changed, but the iconography stays virtually forever. Just like…
The GM Brand:
Here is another icon whose brand has changed and is in the process of changing at this moment.
This brand symbol represents also used to be highly respected and in many ways revered. A true American icon. In short the GM brand used to mean this:
Now the GM brand is in the process of becoming a joke. Government Motors it is called. They make cars that are too expensive, do not hold up well, and that people do not want to drive. Ironically those are the qualities of the current status of government today.
Like all iconography, as we will see more of in the video below, the icon can be used against the brand.
The Obama Brand:
One will find that much of the same manipulation of iconography is used by the Obama brand and against it.
[Note: Disclaimer for leftists and idiots – We are NOT saying that Obama is the same thing as Hitler and neither is Bill Whiddle in the video below, so don’t even go there. This is about the iconography ONLY!]
UPDATE – It looks like the DNC found this little post and removed the video. I should have archived it. I found an unedited version of the video.
In the video they all use slogans except three who mention policy positions. [Editor’s Note: In the video one person mentions NAFTA, which is just too long and complex of an issue to tackle in this post other than to say that here is a video of Bill Clinton’s comments at the signing]
1 – The Civil Rights Act – which Democrats filibustered and Republicans voted for by an 82% margin (eventually Dems caved). Democrats filibustered (successfully stopping the bills) all of the civil rights legislation in the 1950’s all of what was overwhelmingly supported by Republicans. One look at inner cities and inner city schools which are controlled by the Democratic Party show that the party is exploiting black Americans and has no real interest in empowering them.
2 – The Patriot Act – of which internal violations of using the act illegally have gone up exponentially under this administration. Through fast and loose “interpretation” Democrats have expanded the Act and Obama has been the worst administration when it comes to abuse of privacy rights that I am aware of.
Obama promised to put an end to warrantless wiretapping and do something about the Patriot Act. Where are the so called “far left privacy advocates” now? The Obama Administration (along with a willing Democratic Leadership in Congress) has consistently (1, 2, 3, 4, 5,) pushed for more domestic spying ability and extended the Patriot Act. More spying includes including wanting more wire taps on the internet and arguing that you have no reasonable expectation of privacy in email or cell phones or… well I think you got the point. Of course who was the first TV personality to speak out on these privacy violations. Clue: He’s the new Oprah.
Now we get to ask you if Obama is spying on YOUR library book list!
3 – Because more women should be involved in politics – Wow that one is amazing. Shall we go through a list of Democrat misogyny hall of shame? While the first names that come up for sexual attacks, smears, lies, and name calling by Democrats are against Sarah Palin, Michelle Bachmann, and Nikki Haley – Let us NOT forget how Hillary Clinton was mistreated by her fellow Democrats which resulted in the creation of dozens of PUMA groups and websites such as Hillbuzz. Remember how the Obama thugs used threats and in some cases physically kept Hillary delegates out of some caucuses? Remember how the Democrats “super delegates” stepped in when it looked like Hillary was going to win the nomination?
In fact Hillary Clinton’s own Communications Director Howard Wolfson said that Fox News was the only place where her campaign could get a fair shake because the Democrat Media Complex, also known as the elite media, was so grossly unfair even this web site spoke out against it.
This video is one the GOP can use, as it demonstrates that Democrats count on ignorance and mobocracy like sloganeering.
Some states offer attractive tax benefits for retirees. Then there are these ten tax hells, which have earned a place on our “do not live here for your second act” list either because of higher-than-average taxes across the board or because of policies that don’t exempt much retirement income from state taxation.
For retirees living on a fixed income, high income taxes, burdensome real estate taxes and hefty sales taxes on daily purchases can really eat into a nest egg. Choosing to relocate to — or stay put in — a state with a low overall tax burden can help stretch your retirement income.
#1 VERMONT State Income Tax: 3.55%-8.95% State Sales Tax: 6% (localities can add another 1%) Estate Tax/Inheritance Tax: Yes/No
There are no exemptions for retirement income in the Green Mountain State, except for Railroad Retirement benefits (which are exempt in every state). Out-of-state pensions are fully taxed. Vermont exempts medical devices and prescription and nonprescription drugs from its 6% sales tax. But it imposes a 9% tax on prepared foods, restaurant meals and lodging, and a levies a 10% sales tax on alcoholic beverages served in restaurants. Real estate taxes have two components: school property tax and municipal property tax collected by towns and cities where the property is located. The Tax Foundation, a nonprofit tax-research group in Washington, D.C., lists Vermont’s property tax among the ten highest in the nation.
#2 MINNESOTA State Income Tax: 5.35%-7.85% State Sales Tax: 6.875% (cities and counties can add another 2.65%) Estate Tax/Inheritance Tax: No/No
Minnesota offers retirees cold comfort on the tax front. Social Security income is taxed to the same extent it is taxed on your federal return. Pensions are taxable regardless of where your pension was earned. Income-tax rates are high, and sales taxes can reach 9.53% in some cities. Food, clothing, and prescription and nonprescription drugs are exempt from sales taxes. The North Star State does offer some residents 65 and older who have income of $60,000 or less the option of deferring a portion of their property tax. But this is a low-interest loan, not a tax-forgiveness program.
#3 NEBRASKA State Income Tax: 2.56%-6.84% State Sales Tax: 5.5% (localities can add another 1.5%) Estate Tax/Inheritance Tax: No/Yes
There are no tax breaks for Social Security benefits and military pensions in the Cornhusker State. Real estate is assessed at 100% of fair market value. Residents 65 and older qualify for a homestead exemption on property taxes. Food and prescription drugs are exempt from state sales taxes. But Nebraska imposes an inheritance tax on all transfers of property and annuities.
#4 OREGON State Income Tax: 5%-11% State Sales Tax: None Estate Tax/Inheritance Tax: No/Yes
First, the upside: There’s no state sales tax in the Beaver State. But it shares the distinction with Hawaii of imposing the highest tax rate on personal income in the nation on taxable income of $250,000 or more. Although Oregon does not tax Social Security benefits, that’s the extent of its income-tax breaks for retirees. And Oregon has an inheritance tax that applies even to intangible personal property, such as investments and bank accounts, no matter where it is located.
#5 CALIFORNIA State Income Tax: 1.25%-9.55% State Sales Tax: 7.25% (effective July 1, 2011) Estate Tax/Inheritance Tax: No/No
The Golden State has lost its luster for many retirees. Although Social Security benefits are exempt from state income taxes, all other forms of retirement income are fully taxed. Californians pay some of the highest income taxes in the U.S., with the top rate of 9.55% kicking in at $46,767 of taxable income. State and local sales taxes can reach 9.25% in some cities, although food and prescription drugs are exempt. Real estate is assessed at 100% of cash value, but taxes are capped at 1% of value.
#6 MAINE State Income Tax: 2%-8.5% State Sales Tax: 5% (counties can add another 0.5%) Estate Tax/Inheritance Tax: Yes/No
Like the majority of states, Maine exempts Social Security benefits from state income taxes. And residents can deduct up to $6,000 per person of eligible pension income. But remaining income in excess of $20,150 per year is taxed at a steep 8.5% rate. Residents of the Pine Tree State pay a 5% sales tax statewide on everything except food and prescription drugs. All real estate and personal property is subject to local property taxes (and, in some cases, state property taxes, too), but permanent residents can receive an exemption of $10,000 on the assessed value of their home. Maine is also one of only three states that do not allow cities and towns to impose their own local sales taxes.
#7 IOWA State Income Tax: 0.36%-8.98% State Sales Tax: 6% (localities can add another 1%) Estate Tax/Inheritance Tax: No/Yes
The Hawkeye State offers no feathered nest for retirees. Although it allows single retirees to exclude up to $6,000 of retirement-plan distributions from state income taxes, and married couples can exclude up to $12,000, the rest is taxed at rates as high as 8.98%. Iowa taxes a portion of residents’ Social Security benefits, too, although it is in the process of phasing out the Social Security tax, which is scheduled to disappear in 2014. Food and prescription drugs are exempt from the statewide 6% sales tax. Real estate is assessed at 100% of market value, and most property is taxed by more than one taxing authority, such as cities, counties and school districts. There is a small homestead tax credit for residents who live in-state at least six months of the year.
#8 WISCONSIN State Income Tax: 4.6%-7.75% State Sales Tax: 5% (counties can add another 0.5%) Estate Tax/Inheritance Tax: No/No
The Dairy State exempts Social Security benefits and military-related pensions from its state income taxes, but it taxes most other pension and annuity income the same way the federal government does. Retirees 65 and older can subtract $5,000 of qualified retirement income, including IRA distributions, from their Wisconsin taxable income, subject to income restrictions. Some Wisconsin state- and local-government retirees qualify for a tax exemption. But out-of-state government pensions are fully taxed. Food and prescription drugs are exempt from state sales taxes. Some homeowners may qualify for a school property-tax credit against their state income tax.
#9 NEW JERSEY State Income Tax: 1.4%-8.97% State Sales Tax: 7% Estate Tax/Inheritance Tax: Yes/Yes
Its nickname may be the Garden State, but New Jersey is no Eden for retirees. The Tax Foundation says New Jersey’s combined state and local tax burden is the highest in the nation, thanks in part to sky-high property taxes. But there are a few bright spots: New Jersey does not tax Social Security benefits and military pensions. It also allows residents 62 or older with incomes of $100,000 or less to exclude up to $15,000 ($20,000 for married couples filing jointly) of retirement income, including pensions, annuities and IRA withdrawals. Groceries, medicine and clothing are exempt from the 7% statewide sales tax. The state imposes an inheritance tax on the transfer of real and personal property worth $500 or more, but bequests to family members are exempt. Even with the bright spots, it’s an expensive place to live for retirees.
#10 CONNECTICUT State Income Tax: 3%-6.7% State Sales Tax: 6.35%-7% Estate Tax/Inheritance Tax: Yes/No
Connecticut can be inhospitable to retirees, depending on their income and where they earned their retirement benefits. Although some residents of the Constitution State can exclude their Social Security benefits from state income taxes, the exclusion applies only if their adjusted gross income is $50,000 or less ($60,000 or less for married couples). All out-of-state government and civil-service retirement pensions are fully taxed. Effective July 1, 2011, the sales tax rate statewide is 6.35%, with luxury items taxed at 7%. Connecticut residents pay some of the highest property taxes in the U.S., according to the Tax Foundation, but residents 65 and older qualify for an annual property tax credit or rent rebate.
A small tax-exempt political group with ties to wealthy liberals like billionaire financier George Soros has quietly helped elect 11 reform-minded progressive Democrats as secretaries of state to oversee the election process in battleground states and keep Republican “political operatives from deciding who can vote and how those votes are counted.”
Known as the Secretary of State Project (SOSP), the organization was formed by liberal activists in 2006 to put Democrats in charge of state election offices, where key decisions often are made in close races on which ballots are counted and which are not.
Pay attention to this part:
Named after Section 527 of the Internal Revenue Code, so-called 527 political groups — such as SOSP — have no upper limit on contributions and no restrictions on who may contribute in seeking to influence the selection, nomination, election, appointment or defeat of candidates to federal, state or local public office. They generally are not regulated by the Federal Election Commission (FEC), creating a soft-money loophole.
While FEC regulations limit individual donations to a maximum of $2,500 per candidate and $5,000 to a PAC, a number of 527 groups have poured tens of millions of unregulated dollars into various political efforts.
SOSP has backed 11 winning candidates in 18 races, including such key states as Ohio, Nevada, Iowa, New Mexico and Minnesota.
This is where illegal and foreign money and foreign governments influence our elections. The excuse the Soros funded group uses is that it claims Republicans stole the 200 presidential election on Florida. Of course when a group of newspapers went to Florida and recounted themselves they also concluded that president Bush had won fairly.
But let me tell you what wasn’t fair. It wasn’t fair when Al Gore’s lawyers used a technicality to toss out military ballots in Florida. There were valid reasons why the Supreme Court ruled for President Bush in the Bush v. Gore lawsuits: the Florida Supreme Court was allowing Democrats to change the election rules on the fly during the count; and Gore’s lawyers and a partisan Florida Court wanted to allow selective recounting of discarded votes, meaning that only in areas where Gore had a substantial lead would the votes be recounted. President Bush’s team said that if there was going to be a recount it had to be all of the state and under one set of rules – and on that part of Bush v. Gore the Supreme Court agreed 7-2.
Of course Soros’ group has already stolen elections in Minnesota. USA Today, among others, report that Al Franken won his Senate seat through fraud.
Justice Department whistle blower J. Christian Adams went public after the Justice Department dismantled the integrity division of the section in charge of making sure that “Motor Voter” was enforced properly and that dead people were removed from the voter roles. The Obama Justice Department has made it clear that they will not take action in vote intimidation cases if the victims are white and/or the perpetrators are black.
How The Department of Justice Allowed Vote Fraud in Minnesota
Former Department of Justice attorney J. Christian Adams has blown the whistle on politicization within Justice in enforcing election laws, specifically the laws requiring cleaning voter rolls of the deceased and convicted felons. While the main focus of the media (such as it is) has been on the politics of the issue, Adams wants to get more of a focus on the consequences of politicization. He talks with Twin Cities talk-show host Chris Baker about the impact of this politicization in Minnesota, a subject that Minnesota Majority knows all too well. The conservative organization has spent the past 20 months attempting to get the attention of the DoJ on this very subject, to no avail:
Minnesota Majority has experienced the DOJ’s refusal to investigate these kind of cases first-hand. On November 17th of 2008 (immediately following the 2008 General Election and while the Coleman-Franken recount battle was getting underway), Minnesota Majority president Jeff Davis sent a certified letter to then Voting Section chief of the Civil Rights Division at the DOJ, Christopher Coates, requesting an investigation into apparent failures to comply with HAVA by Secretary of State Mark Ritchie. No response was forthcoming.
Since the DOJ in Washington DC failed to follow up on Davis’ complaint, Minnesota Majority contacted the local FBI office and lodged the same complaint. Special Agent Brian Kinney responded and visited the Minnesota Majority office to examine Minnesota Majority’s findings. At that time, he said, “based on what I see here there is more than enough evidence to initiate an internal complaint.” He gave his assurances that he would bring the matter to the attention of his supervisors. There was no further follow-up.
By October of 2009, Minnesota Majority had compiled evidence of further violations of HAVA in Minnesota, including a finding that ineligible felons were not being detected and flagged for challenge or removal from the voter rolls. This resulted in hundreds of fraudulent votes by ineligible felons being counted in Minnesota’s 2008 election. Davis sent another certified letter to Voting Section Chief Christopher Coates. Like the first complaint from nearly a year prior, the second letter went unanswered.
Minnesota Majority’s experience supports J. Christopher Adams’ claims that the DOJ’s policy is not to pursue violations of HAVA’s anti-fraud provisions. The dismissal of the voter intimidation charges against members of the New Black Panther Party who brandished nightsticks outside a Philadelphia polling place during the 2008 General Election was the last straw for Adams, who resigned in protest. He claimed that his superiors also ordered himself and other attorneys not to comply with subpoenas issued by the US Civil Rights commission, placing them in what Adams called, “legal limbo.”
Voting Section Chief Christopher Coates, who worked with Adams on the New Black Panther Party voter intimidation case was demoted and transferred to a post in South Carolina earlier this year.
The Civil Rights Commission has subpoenaed Coates to testify on the matter but his DOJ employers are currently blocking his testimony.
Why would the DoJ block testimony from one of its attorneys on the internal policies of Justice?
The Carter record is a litany of despair, of broken promises, of sacred trusts abandoned and forgotten. Eight million — eight million out of work. Inflation running at 18 percent in the first quarter of this year. Black unemployment at 14 percent, higher than any single year since the government began keeping separate statistics. Four straight major deficits run up by Carter and his friends in Congress. The highest interest rates since the Civil War, reaching at times close to 20 percent, lately they’re down to more than 11 percent but now they’ve begun to go up again. Productivity falling for six straight quarters among the most productive people in the world.
Through his inflation he has raised taxes on the American people by 30 percent, while their real income has risen only 20 percent. The Lady standing there in the harbor has never betrayed us once. But this Administration in Washington has betrayed the working men and women of this country.
The President promised that he would not increase taxes for the low and middle-income people, the workers of America. Then he imposed on American families the largest single tax increase in our nation’s history. His answer to all this misery? He tries to tell us that we’re “only” in a recession, not a depression, as if definitions, words, relieve our suffering.
Let it show on the record that when the American people cried out for economic help, Jimmy Carter took refuge behind a dictionary. Well if it’s a definition — if it’s a definition he wants, I’ll give him one. A recession is when your neighbor loses his job. A depression is when you lose yours. And recovery is when Jimmy Carter loses his.
This is not from any light-weight folks, this is linked on Dr. Greg Mankiw.
Mankiw wrote one of the most respected series of econ college textbooks used in universities today.
Dr. Mankiw:
Tim Conley and Bill Dupor have a new paper on the American Recovery and Reinvestment Act (that is, the Obama stimulus bill). Their empirical findings:
Our benchmark results suggest that the ARRA created/saved approximately 450 thousand state and local government jobs and destroyed/forestalled roughly one million private sector jobs. State and local government jobs were saved because ARRA funds were largely used to offset state revenue shortfalls and Medicaid increases rather than boost private sector employment. The majority of destroyed/forestalled jobs were in growth industries including health, education, professional and business services.
Our benchmark results suggest that the ARRA created/saved approximately 450 thousand state and local government jobs and destroyed/forestalled roughly one million private sector jobs. State and local government jobs were saved because ARRA funds were largely used to offset state revenue shortfalls and Medicaid increases rather than boost private sector employment. The majority of destroyed/forestalled jobs were in growth industries including health, education, professional and business services.
So the American people borrowed and spent close to a trillion dollars to destroy a net of more than one-half million jobs. Does President Obama understand this? I very much doubt it. When he expressed puzzlement at the idea that the stimulus money may not have been well-spent, and said that “spending equals stimulus,” he betrayed a shocking level of economic ignorance.
La Raza means “The Race”. La Raza calls for communist revolution in the United States, wants much of the Western United States given to Mexico (they call it Aztlan), and are so racist that they are often referred to as “The Klan with a tan”; what would one expect from a group that calls itself “the race”?
A Judicial Watch investigation reveals that federal funding for a Mexican La Raza group that for years has raked in millions of taxpayer dollars has skyrocketed since one of its top officials got a job in the Obama White House.
The influential and politically-connected National Council of La Raza (NCLR) has long benefitted from Uncle Sam’s largess but the group has made a killing since Obama hired its senior vice president (Cecilia Muñoz) in 2009 to be his director of intergovernmental affairs.
Ignored by the mainstream media, Judicial Watch covered the appointment because the president issued a special “ethics waiver” to bring Muñoz aboard since it violated his own lobbyist ban. At the pro illegal immigration NCLR, Muñoz supervised all legislative and advocacy activities on the state and local levels and she was heavily involved in the congressional immigration battles that took place in the George W. Bush Administration.
She also brought in a steady flow of government cash that’s allowed the Washington D.C.-based group to expand nationwide and promote its leftist, open-borders agenda via a network of community organizations dedicated to serving Latinos. Among them are a variety of local groups that provide social services, housing counseling and farm worker assistance as well as publicly-funded charter schools that promote radical Chicano curriculums. Judicial Watch published a special report on this a few years ago.
This week a JW probe has uncovered details of the alarming increase in federal funding that these NCLR groups have received since Muñoz joined the Obama Administration. In fact, the government cash more than doubled the year Muñoz joined the White House, from $4.1 million to $11 million.
Not surprisingly, a big chunk of the money (60%) came from the Department of Labor, which is headed by a former Californiacongresswoman (Hilda Solis) with close ties to the La Raza movement. Since Obama named her Labor Secretary, Solis has launched a nationwide campaign to protect illegal immigrant workers in theU.S. Just this week Solis penned declarations withGuatemala andNicaragua to preserve the rights of their migrants.
The NCLR also received additional taxpayer dollars from other federal agencies in 2010, the JW probe found. The Department of Housing and Urban Development doled out $2.5 million for housing counseling, the Department of Education contributed nearly $800,000 and the Centers for Disease Control a quarter of a million.
Additionally, NCLR affiliates nationwide raked in tens of millions of government grant and recovery dollars last year thanks to the Muñoz factor. An offshoot called Chicanos Por La Causa (CPLC) saw its federal funding nearly double to $18.3 million following Muñoz’ appointment.
A social service and legal assistance organization (Ayuda Inc.) that didn’t receive any federal funding between 2005 and 2008 got $600,000 in 2009 and $548,000 in 2010 from the Department of Justice. The group provides immigration law services and guarantees confidentiality to assure illegal aliens that they won’t be reported to authorities.
Related: The speech below was at a La Raza event in Los Angeles
May 08, 2010 — ”Where we now stand is stolen, occupied Mexico”…La Raza rally at UCLA….More gems: ‘Communist Revolution’, ‘Frail, racist white people’, ‘La Raza’ (the Race), Fidel Castro, ‘Northern Front of Latin Revolution’…”40 million…revolutionaries…in the belly of the beast”. “Our enemy is Capitalism and Imperialism”. Sedition anyone?
Sanchee H.S. history teacher Ron Gochez, La Raza Rally at UCLA
Here is his H.S. Let them know what you think of his comments: http://www.santeefalcons.org/
Phone: (213) 763-1000
Los Angeles Unified School District
Tel: 213-241-7000
superintendent@lausd.net
Los Angeles Board of Education:
Tel: 213-241-6389
Email: steve.zimmer@lausd.net
“We are revolutionary Mexican organization here. We understand that this is not just about Mexico. Its about a global struggle against imperialism and capitalism At the forefront of this revolutionary movement is La Raza. We will no longer fall for these lies called borders. We see America as a northern front of a revolutionary movement Our enemy is capitalism and imperialism.”
The Putin/Medvedev oligarchical neo-dictatorship has endorsed Barack Obama’s re-election. Why wouldn’t they. Obama reneged on a promised missile defense shield for Poland and the Czech Republic, let Sakashvilli and the Georgians twist in the wind, handed Medvedev Britain’s key nuclear secrets, and signed on a lopsided arms treaty that gave away the farm. The Russian Oligarch could not have a more submissive counterpart.
Russian President Dmitry Medvedev said on Monday he wanted his US counterpart Barack Obama to win re-election next year, fearing that the two men’s efforts to improve ties may lose steam under a new administration.
“I can tell you directly — I would like Barack Obama to be re-elected president of the United States maybe more than someone else,” Medvedev said in an interview with the Financial Times whose full transcript was released by the Kremlin early Monday.
“If another person becomes US president then he may have another course,” he said.
How touching. Keep in mind that under Putin/Medvedev Russia has been murdering journalists who tell the truth about them, they have been overtly manipulating the European energy market to meddle in elections, and they have sacked the Republic of Georgia.
But I will give credit to Russian leadership in one area, they were smart enough to adopt the tax system developed by famed American economics guru and business leader Steve Forbes, while Obama pushed us deeper into the tax system designed by Karl Marx. Of course, Marx received two inheritances, squandered them both and couldn’t balance a checkbook.
There are more and more of these kinds of videos appearing on the internet. Inner city black America is figuring out that something is wrong. It seems that the man in this video read Obama’s book and realized that Marxism is bad and is full of hypocrisy.
Warning, the man in this video uses “gangsta” like adult language. It probably has 100 cuss words in it.
A little more than a week ago, Vice President Joe Biden traveled to fundraisers in two battleground-state cities, Pittsburgh and Cincinnati.
Neither stop included the White House press corps; requests by local media to cover the events were denied by the vice president’s press office. The Democratic National Committee arranged the events for the Obama Victory Fund.
A number of seasoned political reporters and former White House press-office staffers consider that lack of coverage a dangerous precedent.
“It would behoove the Obama administration to keep its promise of transparency even with fundraisers,” agrees Jeff Brauer, a political history professor at Keystone College. “The United States is a democracy, after all.”
Having press coverage of fundraising events that feature the president or vice president matters for at least two reasons, Brauer explains.
“One, large amounts of taxpayer dollars are being used for personal security at such events. As with all tax dollars, they should be spent with accountability.
“Two, it is important for the public to know what the president and vice president are saying to donors. Is it the same message they are saying to the electorate at large?”
Such knowledge helps citizens judge officeholders’ authenticity and integrity.
More
Days before Biden was sworn in as vice president in 2009, he promised to be more open than his predecessor, Dick Cheney.
Yet his official schedule more often than not lists meetings as “closed press” or shows no public events at all.
If you get into a siege mentality you greatly limit the talent that that can help you and you also give gatekeepers too much power. Leadership isolates. While that is always a problem it becomes a dangerous problem when you are the leader of a group that has a siege mentality.
The siege mentality exacerbates a mass assumption that anything that comes from outside the group cannot possibly be correct. Therefore you must always keep some people around you who are mature enough to be loyal two you while being skeptical of you at the same time; “Yes Boss” doesn’t always serve you well.
When a candidate is under attack by a hostile press, you do not put yourself on a fortress, you put the press inside of a fenced in ring and shoot arrows into the fence when necessary. If your organization does not understand what I just explained you are already in trouble.
Note: This did not appear in the printed edition of the Washington Post, not does it appear on the paper’s main site. It is on their blog site. They can say that they reported it while making sure that most average people never see this story.
“Chrysler has repaid every dime and more of what it owes American taxpayers for their support during my presidency.”
— President Obama, June 4, 2011
This post has been updated.
With some of the economic indicators looking a bit dicey, President Obama traveled to Ohio last week to tout what the administration considers a good-news story: the rescue of the domestic automobile industry. In fact, he also made it the subject of his weekly radio address.
We take no view on whether the administration’s efforts on behalf of the automobile industry were a good or bad thing; that’s a matter for the editorial pages and eventually the historians. But we are interested in the facts the president cited to make his case.
What we found is one of the most misleading collections of assertions we have seen in a short presidential speech. Virtually every claim by the president regarding the auto industry needs an asterisk, just like the fine print in that too-good-to-be-true car loan.
Let’s look at the claims in the order in which the president said them.
“Chrysler has repaid every dime and more of what it owes American taxpayers for their support during my presidency — and it repaid that money six years ahead of schedule. And this week, we reached a deal to sell our remaining stake. That means soon, Chrysler will be 100 percent in private hands.”Wow, “every dime and more” sounds like such a bargain. Not only did Chrysler pay back the loan, with interest — but the company paid back even more than they owed. Isn’t America great or what?
Not so fast. The president snuck in the weasel words “during my presidency” in his statement. What does that mean?
According to the White House, Obama is counting only the $8.5 billion loan that he made to Chrysler, not the $4 billion that President George W. Bush extended in his last month in office. However, Obama was not a disinterested observer at the time. According to The Washington Post article on the Bush loan, the incoming president called Bush’s action a “necessary step . . . to help avoid a collapse of our auto industry that would have had devastating consequences for our economy and our workers.”
Under the administration’s math, the U.S. government will receive $11.2 billion back from Chrysler, far more than the $8.5 billion Obama extended.
Through this sleight-of-hand accounting, the White House can conveniently ignore Bush’s loan, but even the Treasury Department admits that U.S. taxpayers will not recoup about $1.3 billion of the entire $12.5 billion investment when all is said and done.
The White House justifies not counting the Bush money because, it says, that money was completely spent when Obama was making a tough political decision on whether to extend another loan. In other words, a decision to do nothing at the time would have resulted in the immediate loss of the $4 billion that Bush had extended.
This is chicanery. Under the president’s math, Chrysler paid back 100 percent of Obama’s loan and less than 70 percent of Bush’s loan. A more honest presentation would combine the two figures to say U.S. taxpayers got back 90 percent of what they invested. In fact, that is how the Treasury and other administration officials frequently portray it; it is just when Obama speaks that the numbers get so squishy.
The White House justifies saying that Chrysler will be in 100 percent “in private hands” because there will no longer be government ownership once Fiat completes its purchase of the U.S. stake. For the record, the United Auto Workers will own 46 percent of the company.
“All three American automakers are now adding shifts and creating jobs at the strongest rate since the 1990s.”The White House says the data to back this claim concerning the Big Three automakers is not public information. The official Bureau of Labor Statistics data refers to the entire auto industry — including foreign auto manufacturers, auto parts manufacturers, auto parts dealers and auto dealers. If you look at the data, the 113,200 jobs added between June 2009 and May 2011 amounts to about a 5 percent increase — from a rather low base.
UPDATE, 10:45 AM: Yen Chen, automotive business statistical analyst at the Center for Automotive Research, says CAR’s analysis of Big Three auto data shows this statistic is correct. The Detroit Three are expected to add 10,000 hourly and 5,000 salaried workers this year, from a base of 115,805 hourly workers and 56, 432 salaried workers. That’s an increase of about eight percent in each case. More than 16,000 hourly workers were added in 1991, but from a much higher base–440,000– and 10,000 were also added in 1995, when there were 433,000 hourly workers. Meanwhile, salaried workers have been on a steady decline since 1990 (when the big Three employed 157,000).
“GM plans to hire back all of the workers they had to lay off during the recession.”This is another impressive-sounding but misleading figure. In the five years since 2006, General Motors announced that it would reduce its workforce by nearly 68,000 hourly and salary workers, creating a much smaller company. Those are the figures that generated the headlines.
Obama is only talking about a sliver of workers — the 9,600 workers who were laid off in the fourth quarter of 2008. About 4,100 were sent home for a few weeks. Another 5,500 were put on indefinite leave, meaning there were no jobs at the time for them. All but 1,000 havereturned to work, and the rest should be back at work by year’s end, according to GM spokesman Greg A. Martin.
“In the year before I was President, this industry lost more than 400,000 jobs, and two great American companies, Chrysler and GM, stood on the brink of collapse. Now, we had a few options. We could have done what a lot of folks in Washington thought we should do — nothing.”This is quite a straw man — that many people wanted to do nothing. It was never so black and white. The debate was over the right course to take in the bankruptcy process.
The Wall Street Journal published Monday an interesting conservative critique of the government’s intervention by David Skeel, a law professor at University of Pennsylvania. Skeel says that the revival of the auto industry “is a very encouraging development,” but “to claim that the car companies would have collapsed if the government hadn’t intervened in the way it did, and to suggest that the intervention came at very little cost, is a dangerous misreading of our recent history.”
We do not read Boehner’s quote that way; in this 2009 comment, he is questioning the administration’s approach while saying, “The success of our automotive industry is critical.”Shelby and Kyl in 2008 were protesting the use of taxpayer funds by Bush to delay a bankruptcy filing; they preferred immediately putting the companies through the bankruptcy process.
It will be up to historians to decide what the best solution would have been for taxpayers and the auto industry. We can understand why the president wants to portray himself as making a lonely and tough decision. But the debate was not either/or, bur rather what was the best policy to bring the automakers back to financial health.
The title as well as some of the commentary below is from Dr. Robert Schneider.
Schneider has been an important figure in American foreign policy and global security during the Reagan and Bush 41 years. Dr. Schneider and myself enjoyed a great conversation about the following article with another CEO/economist from out West. [I have not yet obtained permission to name the Western CEO as of yet but he is described as having an “Obscene IQ” as I am confident his clients will attest to.]
Normally I do not share such conversations, but this one is such a valuable exploration of current public policy I made an exception. Keep in mind that what you are about to read is a conversation that is completely spontaneous. What you are about to read is an intellectual feast. Enjoy!
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Dr. Schneider: I find most the folks on here trying to use “logic” to make arguments, without understanding the fundamental principles underpinning the Ryan plan. The dems argue we have to have stimulation (not Anthony Weiner’s type) to get the economy going again. Here is the argument which the other side can’t counter. Of course, the Ronulans wouldn’t know an economic argument from a sack of worms, but it might be fun to watch their heads explode as you lay this article on them. It is the knockout punch.
For our arguments to win the day against liberals, and others who may think it’s ok to bash Ryan, these arguments are key to getting us back to a prosperous nation, and out of our economic gloom.
Ugly Modeling: Will spending cuts ruin or improve America’s economy?
By Veronique de Rugy
From Reason Magazine
In February, the Goldman Sachs economist Alec Phillips predicted on ABCNews.com that a Republican proposal in the House of Representatives to cut $61 billion from the federal budget in fiscal year 2011, would, if enacted, shave two full percentage points off America’s gross domestic product in the second and third quarters of this year. A few days later, The Washington Post described a new study by Mark Zandi, the chief economist at Moody’s Analytics and an architect of the 2009 stimulus package, a.k.a. the American Recovery and Reinvestment Act. Zandi’s amazing verdict: The spending cuts would destroy 700,000 jobs by the end of 2012.
After every newspaper had published the gloomy predictions, Goldman Sachs issued a “clarification” of Phillips’ analysis. Phillips now says he was misunderstood by journalists eager to spread a doom-and-gloom message and predicts the impact of spending cuts probably will be mild and temporary. Perhaps he was influenced by Federal Reserve Chairman Ben Bernanke, who testified in March at the Senate Banking and Urban Affairs Committee that Goldman’s numbers were incorrect.
Yet even this correction implicitly assumes that government spending is the source of all recovery. The logic, as with Bernanke’s and Zandi’s analyses, is that government spending cuts reduce overall demand in the economy, which affects growth and then employment. This argument ignores the fact that the government has to take its money out of the economy by raising taxes, borrowing from investors, or printing dollars. Each of these options can shrink the economy.
All these analysts also systematically ignore the fact that GDP numbers include government spending. When the federal government pumps trillions of dollars into the economy, it looks as if GDP is growing. When government cuts spending—even cuts within the most inefficient programs—aggregate GDP shrinks.
But that’s misleading. If Washington spends $1 a year on a bureaucrat’s salary, for example, GDP numbers will register growth of exactly $1, whether or not the employee has produced any value for that money. By contrast, if a firm pays an engineer $1, that $1 only shows up in the GDP if the engineer produces $1 worth of stuff to sell. This distinction biases GDP numbers—and the policies based on them—toward ever-increasing government spending.
Furthermore, GDP does not capture changes in personal investment portfolios or changes in private research and development spending. In the last two years, corporate cuts in the latter area have been large but unaccounted for. Also not included in GDP: pension benefits and the U.S. Flow of Funds Accounts balance-sheet information from the Federal Reserve Board. That means that when it comes to GDP, states’ grossly underfunded pensions are off the books, along with the loans and purchases conducted under TARP.
Another problem with these analyses: Economists of all persuasions have proven to be really bad at predicting the future, especially when it comes to jobs. Take the stimulus. Forecasters at the White House and the Congressional Budget Office (CBO) predicted the stimulus package would create more than 3 million jobs. And in August 2010, the CBO estimated that the stimulus had indeed created between 1.4 million and 3.6 million extra jobs, thrilling supporters of economic intervention. But unemployment stubbornly remained around 10 percent.
What was wrong with the CBO’s numbers? “When the upper limit of your estimate is almost three times the lower limit, you know it is not a very precise estimate,” the George Mason University economist Russ Roberts pointed out in testimony to the House Subcommittee on Regulatory Affairs, Stimulus Oversight, and Government Spending in February.
The truth is that there is no way to know the real number of jobs “created or saved” by the stimulus. For that, the CBO would have had to collect data on output and employment while holding other factors constant. But the CBO didn’t do that because that’s different from its job of “scoring” the possible results of proposed legislation. As the CBO explained in a November 2009 report, “Isolating the effects would require knowing what path the economy would have taken in the absence of the law. Because that path cannot be observed, the new data add only limited information about [the law’s] impact.” In other words, CBO number crunchers gave it their best guess before the stimulus and arrived at their subsequent numbers by applying their original prediction model. If the model is wrong, so are the numbers.
No one knows what economic output would have been without the stimulus, and no models can tell us the answer. As Roberts testified, “The economy is too complex. Too many other variables change at the same time.”
Also, the Zandi and Phillips models are based on the Keynesian view that government spending produces recovery. According to that theory, $1 in government spending produces substantially more than $1 in growth, a phenomenon known as the “multiplier effect.” The Goldman Sachs study assumes a multiplier greater than three—i.e., more than $3 in additional GDP for each dollar of government spending. But a review of the empirical literature reveals that in most cases a dollar in government spending produces less than a dollar in economic growth. And these findings often don’t even take into account the impact of paying for that government dollar via increased taxes.
The Harvard economists Robert Barro and Charles Redlick estimate that the multiplier for stimulus spending is between 0.4 and 0.7. In another study, the Stanford economists John Taylor and John Cogan concluded that the stimulus package couldn’t have had a multiplier much greater than zero. Even the multipliers used by Christina Romer, the former chairwoman of the White House Council of Economic Advisers, and Jared Bernstein, economic adviser to Vice President Joseph Biden, in their January 2009 paper “The Job Impact of the American Recovery and Reinvestment Plan,” ranged from 1.05 to 1.55 for the output effect of government purchases. More recently, the Dartmouth economists James Feyrer and Bruce Sacerdote, who supported the stimulus, acknowledged that it didn’t boost the economy nearly as much as the administration models claimed it would.
The use of these outdated models and unrealistic multipliers explains why Zandi was wrong about how many jobs the stimulus would create. He claimed “the country will have 4 million more jobs by the end of 2010” if the stimulus passed. In truth, by the end of 2010 total payroll jobs had fallen by 3.3 million, and the unemployment rate had risen from 7.8 percent to 9.4 percent. The administration’s post-facto claim is that unemployment would have risen even more without the stimulus. To argue this, they again must pretend that they know what would have happened in the absence of a stimulus.
Now what? Many economists and many members of the business community argue that recent policy changes have hampered investment, making a bad situation worse. The prospect of endless future deficits and accumulating debt raises the threats of increased taxes and of government borrowing crowding out capital markets, diverting resources that could be used more productively. As a result, U.S. companies are less likely to build new plants, conduct research, and hire people.
We have tried spending a lot of money to jump-start the economy, and it has failed. Now we need to cut spending and lift the uncertainty paralyzing economic activity. That approach will not just be more fiscally responsible. It will also empower individuals and entrepreneurs. And they are the only ones who can bring on a real recovery.
Ms. de Rugy (vderugy@gmu.edu), a senior research fellow at the Mercatus Center at George Mason University, writes a monthly economics column for reason.
IUSB Vision Editor Chuck Norton: This article above is a VERY good argument, but even so I would add just a couple of minor points (and thoughts).
The Keynesian GDP formula also assumes that government spending is better than consumer or even capital investment spending because people in the private economy will save some of their money and not spend it. Keynes calls this “leakage”.
This concept almost completely ignores the fact that savings have a positive impact on the economy in several ways. If you save the money in a CD the banks have more depositors’ money that can be used for loans and it helps to ease the credit market. Money saved in the form of bonds or stocks or other investing has obvious positive effects that are not measured PROPERLY in the Keynes GDP formula as it is only a dollar per GDP measurement and investment dollars for production have a much larger impact – this is literally where the creation of wealth comes from.
The other impact that savings have in an economy is psychological. Are you more likely to buy a car, or a durable good, or take a risk with an investment if you have more savings? The impact of “confidence” on the economy is difficult to overstate.
The economist Art Okun describes what he called “Okun’s Leaky Bucket” when it comes to government spending. When government spends or redistributes wealth, some of the money just goes poof. It is more than the decreasing incentive for the productive to work when they are punished or the money that is eaten up by the bureaucracy; government spending is just less efficient period for a number of reasons, so the Keynesian dollar per GDP formula critiqued in Bob’s posted article is even worse than the article explains.
When you (or a business) use a dollar it is spent on the greatest need or want. In the macro this results in great efficiency because dollars are going where they are needed/wanted the most. Government spends money for political reasons, corruption, and “make work” central planning. Those dollars are not spent to “produce with maximum efficiency and impact”, they are spent in the hopes that some of it returns in the form of campaign contributions.
When money is used for production to actually make things, especially capital goods, the velocity of those dollars expands greatly, and while it is doing the maximum good in creating wealth, those dollars are taxed more times as they move through various hands and government revenue increases. It is a win/win.
The Keynesian GDP formula assumes that government spending is equal to or better than capital investment spending and such a notion is laughable on its face.
Assume for a moment that we have an economy of 1000 men making widgets. Just to pick a round number lets say they have a GDP of 1000 units. The GDP is equal to the combined productive output within nation’s borders in a year. Enter “The Bernanke” who prints up 100 units and enter “The Pelosi” who spends those 100 units. Congratulations! Now on paper your production just went up to 1100 units of GDP. See how much MORE productive we are!
In reality you still just have 1000 widgets. The increase in GDP is a fantasy. A new GDP formula is needed.
Western CEO/Economist: 100% of the time government stimulus has failed to truly stimulate. Sure, buying a ton of office supplies helps out International Paper, Staples, etc. however it is a $1 gov spends does NOT turn into a $1 in taxation, usually less than 20%.
However, that same $1 in the private sector the velocity of money is accelerated. Also, it is not money spent by government that it has, it must borrow it and that is in essence $2 dollars. Dollar spent and dollar borrowed.
Art Laffer, Milton Friedman, etc have proved that reduced tax rates has a much better stimulative effect on real GDP than any other single measure and it is a LASTING measure. Bush tax cuts took us IMMEDIATELY out of the Clinton (fairly cyclical) recession.
Another thought: the way to have REAL GDP growth is in building: Homes, offices, cars, ships, etc. Without real construction growth (not possible with frozen credit markets) you cannot have sustained GDP growth. Money Supply is growing at 12% or higher with GDP at maybe 1.5%. That is financial suicide.
I am NOT afraid of the border, Al Qaeda, etc, I AM afraid of this massive debt.
Chuck Norton is dead on. Fellow economist? Keynes was uber bright for the TIMES. HE is dated, just like the Austrian boys Hayek and von Mises, both uber bright but not for a truly global world.
Dr. Schneider: V= nQ/M some things you just never forget.
CEO/economist: Most econ theory is just that, theory. Milton taught us to THINK. Free markets ALWAYS chose the right winner. It is when gov makes winners and losers that the tax payer pays and pays…….
Phil Donahue interview of Milton Friedman:
Donahue: When you see around the globe the mal distribution of wealth the desperate plight of millions of people around the world in under developed countries. When you so few haves and so many have not’s when you see the greed and the concentration of power. Did you ever have a moment of doubt about capitalism and whether greed is a good idea to run on?
Milton: Well first of all, tell me is there some society that you know of that doesn’t run on greed? Do you think Russia doesn’t run on greed? Do you think China doesn’t run on greed? What is greed? Of course none of us are greedy; it is always the other fellow that is greedy. The world runs on individuals pursuing their separate interests. The great achievements of civilization have not come from government bureaus! Einstein did not construct his under order from a government bureaucrat! Henry Ford didn’t revolutionize the automobile industry that way. In the only cases in which the masses have escaped from the kind of grinding poverty that you are talking about, the only cases in recorded history, is where they have had capitalism and largely free trade! If you want to know where the masses are worse off is in the exact society’s that depart from that [sic] free trade and capitalism. So that the record of history is absolutely clear that there is NO alternative way so far discovered of improving the lot of the ordinary people that can hold a candle to the productive activities that are unleashed by the free enterprise system.
Donahue: But it seems to reward not virtue as much as the ability to manipulate the system.
Milton: And what does reward virtue? Do you think that the communist commissar rewards virtue? Do you think a Hitler rewards virtue. Pardon me, but do you think American Presidents reward virtue? Do they choose their appointees on the basis of virtue of the people appointed or on the basis of their political clout? Is it really true that political self-interest is nobler somehow than economic self-interest? I think that you are taking a lot of things for granted. Just tell me where in the world do you find these angels who are going to organize society for us?….
Dr. Schneider: Markets are smarter than people.
Chuck Norton: I have to tell you guys this funny story in light of Bob’s last comment “Markets are smarter than people”.
I got into an argument with a Marxist prof who was all about central planning and not leaving people’s livelihoods to chance (the market) and insisted that a more rational top down approach was safer and fairer.
So I said to the prof, OK, let’s make a society of 10 million people and you can pick the ten smartest people through all of recent history to plan this economy. Assume that you are in a place with adequate resources to serve the population reasonably. Please pick your 10.
She picked her ten. They were all men with names many would know. I answered, OK now tell me which one of these men will be the central planner in charge of tampons and maxi pads (Laughter). [Markets are smarter than central planners with good intentions, or bad ones – Editor]
Bill O‘Reilly and Glenn Beck don’t always see eye-to-eye — they don’t always agree on everything. But one thing that O’Reilly is agreeing with Beck on now is that there are those on the left who would love to see an economic collapse so that they can remake the system. Chief among those cheerleaders, O’Reilly says, is Beck’s “spooky guy” — George Soros.
Bill O’Reilly resisted accepting this premise for a long time; years even. But as the evidence mounted up it became hard to ignore.
The Democrats are the party of the status quo when it comes to Social Security and Medicare while the governments own numbers admit that these programs will go bankrupt and crash very soon. The reductions in spending discussed in the video were not real cuts at all, they were only reductions in Obama’s proposed budget, and even so it was not even a 1% cut in that budget proposal. The truth is that spending was higher this year than last year, so in reality there were no real cuts, yet the left was still upset.
One of the big problems with Medicare is that the bureaucracy is expensive and truly gargantuan. Billions of dollars go to fund those government jobs that should go to seniors care. The Democrats benefit in the short run and the long run by letting Medicare collapse. In the short run, Medicare not being reformed will mean countless thousands of government employees, will be paying Democrats and the government union dues which is used to finance Democrat political campaigns. Government employees make between 30% and 300% more than their private sector counterparts depending on the job field. That is right folks, Medicare funds are essentially being used to fund Democrat political campaigns.
In the long run, when Medicare explodes seniors will be forced into ObamaCare, which can ration care and push doctors into just “giving gramps the pain pill” kind of care. This is why the Democrats raided half a TRILLION DOLLARS of Medicare funds to pay for the ObamaCare implementation. The administration had moved to implement “death panels” like language but outrage forced them to delay implementation. The bottom line is that ObamaCare gives the President, or the HHS bureaucrat the regulatory authority to implement “death panel” like rationing with the stroke of a pen.
The system is not sustainable. The bureaucracy is huge and government employees earn 30-300% higher than their private sector counterparts and have gold plated benefits. Every dollar that goes to a bureaucrat who is not accountable to you and has no incentive to be efficient is another dollar that is not used for someones good care.
Government programs should not be “unionized job programs to get union dues to the Democrats” first, and programs people use second. We cannot afford to carry on the status quo any more if we want to deliver on promised benefits. Unless we have reform such as the Paul Ryan plan, the system will blow up and the government reports show it.
The debate about whether Social Security faces a problem and needs to be fixed is over. The 2011 trustees report, which was released this afternoon, shows that the program already faces massive permanent annual deficits. In 2010, Social Security spent $49 billion more in benefits that it took in from its payroll tax. This year, that deficit will be approximately $46 billion.
Now is the time to focus on solutions. Instead of just blindly defending the current program, both Congress and the Obama Administration should propose comprehensive programs that permanently fix Social Security. It is one thing to oppose a solution; it is another to come up with a plan and fix the problem.
Social Security Problem $1.2 Trillion and One Year Worse
In net present value terms, Social Security owes $9.1 trillion more in benefits than it will receive in taxes. The 2011 number consists of $2.6 trillion to repay the special issue bonds in the trust fund and $6. 5 trillion to pay benefits after the trust fund is exhausted in 2036—a year earlier. This is an increase of $1.2 trillion from last year’s report, which also reflects several changes to assumptions and methodology.
A key change in this year’s report is that Social Security is predicted to run cash-flow deficits from now on. The immediate cash-flow deficits are largely due to the effects of the recession on its finances. The recession increased the amount of benefits paid out by Social Security as older workers who have lost their jobs choose to file for benefits earlier than they might have otherwise. Meanwhile, younger unemployed workers are unable to pay Social Security taxes, while workers who suffer a drop in their income pay lower amounts.
Net present value measures the amount of money that would have to be invested today in order to have enough money on hand to pay deficits in the future. In other words, Congress would have to invest $9.1 trillion today in order to have enough money to pay all of Social Security’s promised benefits through 2085. This money would be in addition to what Social Security receives during those years from its payroll taxes.
The just released 2011 Medicare trustees report does not contain any big surprises. Much of what the trustees say in this report they have said before: Medicare poses enormous challenges for patients and taxpayers alike, and its financial condition continues a downward slide. Some key findings:
Medicare’s unfunded obligations increased by $2 trillion. A key indicator of the true cost of the program is the cost of the promised benefits that are not financed by dedicated revenues. Using their standard 75-year projection (2011–2085), the trustees estimate this year that Medicare benefits promised that are not paid for amount to $24.6 trillion, compared to their projection of $22.5 trillion last year. These and other projections in the report are based on current law, including the official assumption that the estimated $575 billion in savings from Medicare provider cuts under Obamacare will be sustained, as well as the 29 percent reduction in Medicare physician payments in 2012. The Medicare trustees concede the point: “Although the long-term viability of some of these provisions is debatable, the annual report to Congress on the financial status of Medicare must be based on current law” (emphasis added). Different assessment and different accounting techniques, of course, can yield different estimates of these long-term costs. Based on an alternative scenario of projected costs and spending that many analysts considered more realistic, the Medicare actuary in 2010 estimated the long-term Medicare debt at $34.8 trillion. The Medicare actuary has yet to offer his alternative assessment for 2011.
The financial condition of the Medicare Part A trust fund is worse. The Hospitalization Trust Fund—the part of the program that pays seniors’ hospital bills—is in worse shape than reported last year. The Hospital Insurance (HI) Trust Fund is going to be exhausted in 2024 rather than 2029. While the fund has started running big annual deficits ($32 billion in 2010 and $34 billion in 2011), the five-year acceleration of the fund’s exhaustion has been aggravated by a combination of higher hospital spending and the consequent reduction in the payroll tax receipts resulting from the economic downturn. When the HI fund is exhausted, obviously it cannot pay benefits. Congress would have to replenish it with higher taxes. One more point: It should be noted that the most recent Congressional Budget Office assessment of the trust fund (March 2011) is more pessimistic and projects an exhaustion in 2020.
The “Medicare Funding Warning” has been issued again. Under current law, the Medicare trustees are required to issue a Medicare Funding Warning. This means that general revenues will account for more than 45 percent of Medicare’s total outlays. The 45 percent threshold for such funding, in contrast to dedicated revenues, is officially “excessive” under current law. In this year’s report, the statutory threshold has been reached again this year, as it was last year, and the President is required to develop a proposal to transmit to Congress to deal with the problem.
This year’s trustees report only confirms the seriousness of the financial challenge posed by an unreformed Medicare program. Over the full 75-year budget window for the entitlements, about 90 percent of the growth of Medicare and Social Security is going to occur by 2035. The baby boom generation, to be supported by a relatively smaller workforce, will drive costs to new levels. That is indeed why The Heritage Foundation’s comprehensive reform proposal, Saving the American Dream, takes on an even greater urgency.
A chart created by the Center on Budget and Policy Priorities (CBPP) has been circulating among liberal bloggers such as Ezra Klein, James Fallows, and Andrew Sullivan.
The chart, seen to the right, purports to show that the next decade’s deficits are entirely the result of the 2001 and 2003 tax cuts, wars, bailouts, recession, and stimulus.
Their methodology fails statistics 101.
Imagine a basketball team that loses 100-98. It would make no sense to cherry pick one single basket by their opponent and blame it for 100 percent of the loss – letting all other baskets scored off the hook. Yet that is essentially what CBPP is doing.
See the rest of the story with charts and evidence HERE.
You Promised To Save Millions From Foreclosure Yet Your Housing Program Was A Failure And Now The Housing Market Is In The Midst Of A “Double Dip.” Why Has Your Administration Largely Ignored Struggling Homeowners?
The RNC asks a very good question here. A question we have been asking over and over again Link + 1, 2, 3, 4, 5, 6, 7, 8.These girls would like an answer:
PROMISE: President Obama Promised That His Housing Program Would Prevent 7 to 9 Million Families From Foreclosure. “And we will pursue the housing plan I’m outlining today. And through this plan, we will help between 7 and 9 million families restructure or refinance their mortgages so they can afford—avoid foreclosure.” (President Barack Obama, Remarks On The Home Mortgage Industry In Mesa, Arizona, 2/18/09)
FACT:
Only One In Four Of 2.7 Million Homeowners Seeking Assistance From Obama’s Mortgage Relief Plan Succeeded In Getting Their Payments Reduced. “Just one in four of the 2.7 million homeowners who sought to participate in the Obama administration’s signature mortgage assistance program have succeeded in getting their monthly payments reduced.” (Alan Zibel and Louise Radnofsky, “Only 1 In 4 Got Mortgage Relief,” The Wall Street Journal, 2/28/11)
Inspector General Neil Barofsky, Who Oversaw HAMP, Said That The Program “Continues To Fall Short Of Any Meaningful Standard Of Success.” “The program has faced sharp criticism. Neil Barofsky, the departing special inspector general overseeing the program, has faulted the administration for launching it with inadequate analysis and only partially developed guidelines. This led to delays and confusion, and the program ‘continues to fall short of any meaningful standard of success,’ he said a report released in January.” (Alan Zibel and Louise Radnofsky, “Only 1 In 4 Got Mortgage Relief,” The Wall Street Journal, 2/28/11)
“It’s Official. Home Prices Have Double Dipped Nationwide, Now Lower Than Their March 2009 Trough, According To A New Report From Clear Capital.”(Diana Olick, “National Home Prices Double Dip,” CNBC, 5/5/11)
“Home Values Posted The Largest Decline In The First Quarter Since Late 2008, Prompting Many Economists To Push Back Their Estimates Of When The Housing Market Will Hit A Bottom.” (Nick Timiraos, “Home Market Takes A Tumble,” The Wall Street Journal, 5/9/11)
The Oregonian: “Economists Who Once Predicted That Prices Would Bottom Out Sometime This Year Now Are Saying, Well, Maybe In 2012.” “Lenders have filed more than 300,000 foreclosures against American families every month for almost two years. As long as that’s occurring, the housing numbers will stay bleak. Home prices nationally have fallen for 57 consecutive months. … Economists who once predicted that prices would bottom out sometime this year now are saying, well, maybe in 2012. ” (Editorial, “American Housing: Underwater And Still Sinking,” The Oregonian, 5/9/11)
“If you’re complaining about the price of gas and you’re only getting 8 miles a gallon, you know,” Obama said laughingly. “You might want to think about a trade-in.”
Are we ready to throw him out yet?
This is coming form the guy who in 2008 told Mort Kondrake on CNBC that he would be fine with $4.00 a gallon gas, so long as the price rose slowly – LINK.
In the mean time other countries continue to drill just off our shores while Obama keeps our guys out:
HAVANA — Cuba on Tuesday announced plans to drill five deepwater oil wells in the Gulf of Mexico beginning this summer, expressing confidence that its efforts will be rewarded with major new energy finds.
“We’re about to move to the drilling phase,” said Manuel Marrero, an official with the government authority tasked with overseeing Cuba’s oil sector.
“We’re all really hopeful that we will be able to discover large reserves of oil and gas,” said Marrero, who added that the ventures would be undertaken with the help of unspecified foreign companies.
He said the deepwater wells were to be drilled between 2011 and 2013, and would be in waters ranging in depth between 400 meters (a quarter mile) and 1,500 meters (1.6 miles). He did not specify which countries would be among the foreign partners working with Havana on the project.
So now we can buy our own oil back from China, Cuba, and Brazil. The academic left always wanted to redistribute America’s wealth around the world, so this is how they are doing it.
First of all, lets talk about the “fringe”. Beck was right about ACORN, Apollo Alliance, Chicago Climate Exchange, SEIU, Soros, Van Jones, bias in school text books, Maoists like Anita Dunn and the list goes on.
They called him names, called him a liar, and then people quietly admitted that he was right. His presentation is unorthodox, I mean he taught economics and history and got ratings doing it.
While Glenn wasn’t perfect, who is? The problem is not that Glenn is fringe, the problem is that we have fringe leftist academics extremists who live in a rather nutty world of theory in power. Since Glenn was right about all of the things I mentioned above and more. If he is fringe what does that say about the stories he got right on?
Glenn, like Rush Limbaugh, is not a “conspiracy theorist” he is prescient. He sees the trajectory the facts are moving in and makes judgments about what he sees is coming. When Glenn said early last year that inflation was coming and to get food built up and get out of debt the “non fringe” people said he was nuts, well look at who was right.
How many times has Rush Limbaugh made jokes about the left and predictions about them and been shown correct time and time again?
Secondly, when Glenn said, “Oh they will wish I was back on at five when they see what is coming”… and when you see Megyn Kelly, Bret Baier get this “cat that just ate the canary” grin when they talk about Beck’s future it seems rather obvious that they are holding back and just dying to say what “it” is.
Third, Matt Lewis’ analysis leaves out the key factor in all of this, Roger Ailes. Ailes’ history is to find good talent and let them do whatever they want as long as they backed up what they said. Beck installed the red phone and dared others to try to prove him wrong, he put out a data sheet worth each show so people could look the facts up for themselves. Ailes is not afraid of risk or being different, so I find it very hard to believe that Roger wanted Beck out.
Beck’s detractors call him names, create false narratives about him with carefully edited clips (like ABC News did recently), but what you do not see is anyone even attempting to take him on fact per fact, or debate him Lincoln-Douglass style etc.
Lastly, Beck is a huge star and the second most popular host on television. Leaving Beck at the bummer time slot of 5pm is the only thing that was impossible. One does not park a superstar like Glenn Beck in the 5 pm time slot. Change is coming to Fox alright, but you can be sure that between the creative genius of Roger Ailes and Glenn Beck, the fringe progressive secular left isn’t going to like the change one bit.
If you want to understand better why so many states—from New York to Wisconsin to California—are teetering on the brink of bankruptcy, consider this depressing statistic: Today in America there are nearly twice as many people working for the government (22.5 million) than in all of manufacturing (11.5 million). This is an almost exact reversal of the situation in 1960, when there were 15 million workers in manufacturing and 8.7 million collecting a paycheck from the government.
It gets worse. More Americans work for the government than work in construction, farming, fishing, forestry, manufacturing, mining and utilities combined. We have moved decisively from a nation of makers to a nation of takers. Nearly half of the $2.2 trillion cost of state and local governments is the $1 trillion-a-year tab for pay and benefits of state and local employees. Is it any wonder that so many states and cities cannot pay their bills?
Every state in America today except for two—Indiana and Wisconsin—has more government workers on the payroll than people manufacturing industrial goods. Consider California, which has the highest budget deficit in the history of the states. The not-so Golden State now has an incredible 2.4 million government employees—twice as many as people at work in manufacturing. New Jersey has just under two-and-a-half as many government employees as manufacturers. Florida’s ratio is more than 3 to 1. So is New York’s.
Even Michigan, at one time the auto capital of the world, and Pennsylvania, once the steel capital, have more government bureaucrats than people making things. The leaders in government hiring are Wyoming and New Mexico, which have hired more than six government workers for every manufacturing worker.
Now it is certainly true that many states have not typically been home to traditional manufacturing operations. Iowa and Nebraska are farm states, for example. But in those states, there are at least five times more government workers than farmers. West Virginia is the mining capital of the world, yet it has at least three times more government workers than miners. New York is the financial capital of the world—at least for now. That sector employs roughly 670,000 New Yorkers. That’s less than half of the state’s 1.48 million government employees.
U.S. Sen. Scott Brown — an upstart Blue State Republican in the cross hairs of national Democrats — is lashing out at the party’s opposition researchers, accusing them of prying into his family’s private health insurance records, and demanding that they stop fighting dirty.
“It seems in bad form. Obviously, when it comes to information about my wife and daughters, it crosses the line. I find it offensive and so do they,” Brown told the Herald yesterday.
“They (Democrats) don’t have any business muddling in the private health records of my family,” said Brown, adding that his family is “disturbed” by the intrusion.
Officials from the Group Insurance Commission, the state’s health insurance provider, notified Brown on Tuesday that the Democratic Senatorial Campaign Committee asked them “to provide insurance information,” according to a copy of the GIC letter obtained by the Herald.
The GIC, a quasi-independent state agency, administers health insurance for state employees and their families. Brown’s wife, Gail Huff, and two daughters, Ayla and Arianna, were also on his state insurance plan when he was a Wrentham state senator.
A copy of the DSCC request provided to the Herald asks for “all direct correspondence” between Brown and the GIC under the Massachusetts public records law.
Now this is rich….
A DSCC spokesman insisted the request was only for public information and never sought private medical information about the Brown family.
To provide insurance information, like what was paid out, claims made etc. It is pretty easy to reverse engineer a medical record from that information, but oh no, you don’t want medical information, WHICH IS WHY YOU SENT THE LETTER TO THE STATE MEDICAL INSURANCE COMMISSION….
Come on guys, if you are going to issue a denial, can you at least come up with one that is better than that? Remember this is the state with RomneyCare folks, they state will have those records and the Democrats want them.
The Democratic Party illegally obtained Michael Steele’s credit report and released it, Obama illegally obtained a copy of Jack Ryan’s sealed divorce papers to put the details of his sex life and such on the front page and the Democrats also put Congressman Allen West’s Social Security number and other person info in a mailer to 60,000 people.
AWESOME: US and Japanese Forces Rescue Dog Swept to Sea Three Weeks Ago in Japan
Kristi Noem: Democrats are Rooting for a Government Shutdown
“The federal government accumulates more deficit every single day than my home state did in a year.”
Democrats are on retreat after the leadership was caught on tape plotting a government shutdown to increase deficit spending. Rasmussen: 57% prefer government shutdown to current levels of spending – LINK. Former DNC Chair Howard Dean: Democrats should root for a government shutdown – LINK.
This time both the Democrat and Republic strategist agree; not only is the statement preposterous, but you can say that about anything.
Why do we pay the people in Congress or the federal government or the military? Don’t you know how many lives we could “save” around the world with that money? Do it for the children!
Trump weighs in on the policy debate: If I am President Iran WILL NOT have a nuclear weapon. Iraq needs to pay us back, Saudi needs to pay us for protecting them and keeping them in power. The Arab League asked us to deal with Ghadaffi, they are super rich countries so pay for it! Trump talks China, trade, OPEC, taxes, jobs and more
This is a no miss interview, even if you do not take Trump seriously you should still watch it.
On trade, Trump is right but there will be consequences, a big tariff on China will mean an instant price increase in everything that is made there, which lately seems like most things. So the poor and middle class will take a hit, for a while. But it must be done. Trump is right that we are being sucked dry and we have had leaders who have not looked out for our economic interests (which is obvious).
The problem is that currency manipulation and labor costs are only a part of the problem. The Obama Deficit Commission which the media doesn’t want to talk about much lately is right in that our tax rates are too high, our tax code is too complicated and too hard to comply with, and we have so many regulations (many of which are corrupt to help political cronies) that it is impossible to comply with them all. We have so many regulations no one could even read them all in a lifetime so it is no mystery why investors and job creators do not want to invest here. Trump does hit on these problems, but does not tie it in with his narrative about the Chinese and others that are fleecing us. He should as it really is one problem.
Former CIA “bin-Laden Unit” Head To CNN Anchor: “You’re Just Carrying The Water For Mr. Obama”
Dr. Scheur wrote a “Bush bashing” book. He has also blasted Obama and Clinton for bad “war on terror” tactics/strategy. He was the head of the CIA’s bin-Laden unit. He was one of the sources for the film, “The path to 9/11”. Dr. Scheur almost always has facts that are not disputable, but of course his conclusions are open to debate. Scheur’s opinions are highly informed ones though and have merit even if I do not totally agree with them.
Like Dr. Niall Ferguson, Dr. Scheur has little tolerance for biased, no nothing reporters who are often less informed than his students.
Mexican Cartels Get Heavy Weapons from Central America, U.S. Cables Say
Dick Morris Reports: Wisconsin Reforms In Peril Due To Possible Election Of Radical Judge
Congressman Issa subpoena’s documents after Obama Administration stonewall in project gunrunner case. The administration was actively facilitating American guns going to the Mexican Drug Cartels and got caught. – LINK.
Police Caught On Tape Beating Black Man.
The man is a member of the Nation of Islam and allegedly as he was working at a night club he was taking keys from customers and going to their cars and stealing items such as GPS, computers and he was caught with a stolen firearm. You can see on the tape that he surrendered to police and they beat him for some time and there are multiple police obviously breaking the law so what you see here is an automatic conspiracy by police to break the law and cover it up. After all if there was no tape what would the police report have said? I have an idea, something like “the police were fighting this athletic perp and the police feared for their collective lives and very regrettably the suspect was injured but the police used all possible restraint”. So here is the rub, if the police in this video were capable of this, how can anything they say about the charges against this man be believed? This is why police need to have restraint especially if this man is guilty, because of this tape not only will he walk, but the city will be writing him a big fat check. – LINK for the video and story.
More Obama Administration Nuttery: American servicewomen “encouraged” to wear “hijab” headscarves in Afghanistan – LINK.
‘Unprecedented’ Political Review of FOIA Requests by Homeland Security Department
Threats and boycott of small business by union leadership leads to 300% sales increase. Rank and file members of AFSCME stop by to apologize for their leadership’s idiocy:
UNION GROVE – Local union members apologized to business owners Thursday after hearing union leadership threatened to boycott businesses.
The stunning development happened late Thursday afternoon at Village Dollar, where members with the American Federation of State, County, and Municipal Employees showed their support to businesses that were targeted.
It all started after Dawn Bobo, owner of Village Dollar in Union Grove, refused to put up a sign supporting AFSCME.
The public union is against Governor Scott Walker’s plan to take away most collective bargaining rights for its members.
Bobo didn’t want to take sides, fearing she would offend customers.
“I have customers from all walks of life, “she said. “In a tough economy you need everyone here.”
But apparently that wasn’t good enough for AFSCME Union Rep. Jim Parrett, who sent her a letter that reads in part:
“We’d ask that you reconsider taking a sign and stance to support public employees in this community. Failure to do so will leave us no choice but do a public boycott of your business.”
“It rubbed me the wrong way,” said customer John Charnon.
He and other customers drove out of their way to shop at Village Dollar Thursday. According to Bobo, business tripled because of it.
Even some local AFSCME union members called the threats “thuggish”.
“The statements and threats made by Jim Parrett do not represent everyone in the local, we didn’t support it,” said Paul Baumester, a member of AFSCME, Local 3777.
He and several other union members shook hands with Bobo Thursday afternoon and apologized to her and other businesses for the threats. They claim they were never consulted about the letters.
Baumester says he’s still against Governor Walker’s budget proposals, but he believes the threats are exactly the wrong thing to do.
“Right when we think we might be making some headway here, we lose ground in the public eye,” he said.
We made several attempts to contact Parrett by phone, but an operator said his voice mail box was full.
And now thanks to his letter, so is Bobo’s dollar store, which now has a sign of its own in the window. It reads, “We support Union Grove, not bully tactics.”
“I want them to have the rights they’re entitled to, but they are not entitled to take mine away,” said Bobo when talking about AFSCME.
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