Tuesday, April 19, 2011

Obama's Illusionary Defict Reduction Plan

The Washington Post is reporting today that the "Obama administration tries to reassure public on plans to cut deficit".  The article even had glowing images of him before a crowd proclaiming the need to resolve the deficit problem. Well, if Obama is going before the public to "sell" his plan, he must really have one.  Where is it?  To bad, the Post article was nothing more than Orwellian Newspeak.

If Obama is going before the American public to sell a deficit reduction plan, one would think that the Post would demand some real facts so that Obama's proposals for so-called deficit reduction could actually be analyzed.  Seems that the Post reporters are more concerned with portraying a "positive" image of Obama rather than analyzing his vacuous assertions of deficit reduction.

Well even though the "left hand" of Post did not give Obama a critical examination, the "right hand" of the Post did provide the graphic below. To be fair, the graphic probably does not take account Obama's undisclosed plans concerning how he would actually reduce the deficit.  All I can say, from what I have read is that there is no real proposal to reduce the debt. Obama's assertions of deficit reduction are illusionary. We have a "Bread and Circuses" economy to simply win votes from the masses, not to solve our deficit problem.

PS: Looks like my April 14th guesstimate: "Obama's "savings" would result in an approximate debt of $22.6 trillion dollars." is pretty close to the graph above.

Saturday, April 16, 2011

The Cost of Candor

Went to the barber shop today.  They had an old Time Magazine.  A real paper version!   Took me me a while to recall how to physically turn a paper page.  Through perseverance, I overcame this impediment.

While waiting my turn for a haircut I leafed through it.  In doing that I ran across  Nancy Gibbs' article "The Cost of Candor" (February 28, 2011).  Essentially Ms. Gibbs explains that politicians lie to us because telling the truth would be suicidal for them.  An unfortunate reality.

Ms. Gibbs, I observed also recognized the vacuous truth behind our so-called deficit "reduction" efforts.  She refers to these misleading claims of budget solutions as a "pathetic pageant".  She correctly observes that: "Meanwhile, the President proposes a budget that addresses the deficit by adding only $7 trillion over the next decade rather than $8 trillion."  Good for her, finally someone in the media has correctly articulated in the mass media that each budget proposal is nothing more than the continuation of a "pathetic pageant" of deceit. Regretfully, avoiding the truth today is not merely suicidal for the truth teller, but for the country as a whole.

Thursday, April 14, 2011

Fiscal Insanity Continues IV

The budget crises continues to intensify. On Wednesday, April 13, 2011 the President provided a nice sounding positive rhetorical speech that was vacuous in real intent. The Washington Post in covering the speech ran this article: "Obama announces framework for cutting deficit by $4 trillion over 12 years"

The problem? Obama did not offer a real tangible implementation plan and the allusion to cutting the deficit by $4 trillion dollars is nothing more than smoke and mirrors. Jennifer Rubin wrote: "The president speaks, says very little".

Based on a website that tracks government spending (assuming that the website is accurate) Obama's budget proposals has (will) run-up an increase in the deficit by approximately $5.5 trillion dollars over four years. So in four years you can spend like a drug addict, but then you offer to only "reduce" (whatever that means) the deficit by $4 trillion in 12 years!

But let's go a step further, the phrase "cutting the deficit" seems undefined. Basically a misleading word play. When someone says that they are cutting the deficit that means, to me, an actual reduction in the deficit. According to the website, where I got my data, the US debt by the end of 2012 will be approximately $19.03 trillion dollars. So if Obama is being honest with this assertion of deficit reduction the US debt should be reduced to approximately $15.6 trillion dollars in 12 years.

Note that in 2009 the US debt stood at $14.5 trillion dollars.

Like most politicians, Obama assertion of actually "cutting the deficit" is fanciful. What he appears to be doing, in reality, is claiming that the proposed spending cuts and tax increases would result in a debt that is $4 trillion dollars less than was otherwise projected.

The website that I have been using only goes to 2016, essentially five years from now. $4 trillion dollars divided by 12 years would amount to annual $0.333 trillion dollars "reduction" in projected spending. Multiply that by 5 and we would have an approximate $1.7 trillion dollar "reduction". According to the website, the US debt, based on current projections, would be $24.3 trillion dollars. Obama's "savings" would result in an approximate debt of $22.6 trillion dollars.

For 2011 the projected debt is around $18.1 trillion dollars. By 2016 the debt with Obama's "savings" will rise to to $22.6 trillion dollars. A yearly increase in the debt of around $0.9 trillion dollars. One can hardly call this continued increase "deficit reduction" or even fiscally prudent spending. Obama in 2006 uttered these prophetic words, which he now conveniently "regrets".  "The fact that we are here today to debate raising America’s debt limit is a sign of leadership failure."

So when are we going to see real leadership? To be credible Obama concerning his proposed budget, should have offered specific dollar revenue/expenditure figures for the remainder of FY2011 (which should have been passed by October 1, 2010 (another leadership failure)) and for Fy2012.

As an acknowledgement to Thales750 and Vassago; it is the US House of Representatives that actually passes the appropriations bill. Obama's budget proposal is a recommendation to the US House of Representatives.

Monday, April 11, 2011

Fiscal Insanity Continues III

Today I was just sent the following editorial written by Charley Reese.  According to snopes.com: "Journalist Charley Reese (now retired) was part of the Orlando Sentinel's staff for three decades between 1971-2001, during which time he (among other duties) penned a thrice-weekly column which was distributed to other newspapers nationwide by King Features Syndicate. During the 1980s Reese wrote the first version of an editorial opining that 545 people (i.e., the President of the United States, plus all the members of Congress and the Supreme Court) "are directly, legally, morally and individually responsible for the domestic problems that plague this country," and he has amended, updated, and republished that piece several times since then."

Mr. Reese wrote:
Politicians, as I have often said, are the only people in the world who create problems and then campaign against them.

Everything on the Republican contract is a problem created by Congress. Too much bureaucracy? Blame Congress. Too many rules?

Blame Congress. Unjust tax laws? Congress wrote them.

Out-of-control bureaucracy? Congress authorizes everything bureaucracies do. Americans dying in Third World rat holes on stupid U.N. missions? Congress allows it. The annual deficits?

Congress votes for them. The $4 trillion plus debt? Congress created it.

To put it into perspective just remember that 100 percent of the power of the federal government comes from the U.S. Constitution. If it's not in the Constitution, it's not authorized.

Then read your Constitution. All 100 percent of the power of the federal government is invested solely in 545 individual human beings. That's all. Of 260 million Americans, only 545 of them wield 100 percent of the power of the federal government.

That's 435 members of the U.S. House, 100 senators, one president and nine Supreme Court justices. Anything involving government that is wrong is 100 percent their fault.

I exclude the vice president because constitutionally he has no power except to preside over the Senate and to vote only in the case of a tie. I exclude the Federal Reserve because Congress created it and all its power is power Congress delegated to it and could withdraw anytime it chooses to do so. In fact, all the power exercised by the 3 million or so other federal employees is power delegated from the 545.

All bureaucracies are created by Congress or by executive order of the president. All are financed and staffed by Congress. All enforce laws passed by Congress.

All operate under procedures authorized by Congress. That's why all complaints and protests should be properly directed at Congress, not at the individual agencies.

You don't like the IRS? Go see Congress. You think the Alcohol Tobacco and Firearms agency is running amok? Go see Congress.

Congress is the originator of all government problems and is also the only remedy available. That's why, of course, politicians go to such extraordinary lengths and employ world-class sophistry to make you think they are not responsible. Anytime a congressman pretends to be outraged by something a federal bureaucrat does, he is in fact engaging in one big massive con job. No federal employee can act at all except to enforce laws passed by Congress and to employ procedures authorized by Congress either explicitly or implicitly.

Partisans on both sides like to blame presidents for deficits, but all deficits are congressional deficits. The president may, by custom, recommend a budget, but it carries no legal weight. Only Congress is authorized by the Constitution to authorize and appropriate and to levy taxes. That's what the federal budget consists of: expenditures authorized, funds appropriated and taxes levied.

Both Democrats and Republicans mislead the public. For 40 years Democrats had majorities and could have at any time balanced the budget if they had chosen to do so. Republicans now have majorities and could, if they choose, pass a balanced budget this year. Every president, Democrat or Republican, could have vetoed appropriations bills that did not make up a balanced budget. Every president could have recommended a balanced budget. None has done either.

We have annual deficits and a huge federal debt because that's what majorities in Congress and presidents in the White House wanted. We have troops in various Third World rat holes because Congress and the president want them there.

Don't be conned. Don't let them escape responsibility. We simply have to sort through 260 million people until we find 545 who will act responsibly.

Sunday, April 10, 2011

Fiscal Insanity Continues II

Today the Washington Post carried the headline: "Obama readies broad plan to reduce deficit". Is there any believability in that headline?  I doubt it. Just more smoke and mirrors.  (Other fiscal insanity posts.)

This past Friday, on the brink of a government shutdown, our politicians agreed to an approximate $38 billion dollar proposed spending reduction within a proposed debt increase of  $1.7 trillion dollars.  Our budget deficit for the current fiscal year will now "only" be $1.662 trillion dollars. A whopping (sarcastic) -2%. (This makes a joke out of the Republican's supposed conversion to fiscally responsible government.) The whole congressional debate was pure theater that allowed for grandstanding but failed to actually address our ever growing deficit.

There is also the issue of the fact that the 2011 budget was supposed to have been passed by September 30th of 2010. It wasn't.  The Democrats failed to meet this obligation. Neither the Republicans nor the Democrats seem to be able to formulate legitimate budgets. Past failure of course does not mean that they will fail in the future, but one has to wonder.

On February 22, 2009, the Post carried this headline: "Obama vows to cut huge deficit in half". Instead of even making a superficial gesture in deficit reduction, Obama's 2012 budget proposal according to the Post will result in a  record $1.6 trillion deficit.

Well what about the Bipartisan National Commission on Fiscal Responsibility and Reform and its recommendations for cutting the budget? Seems that his Commission has been regulated to the dust bin of history.  All that Obama seems to have said about it was solely regulated to the State of the Union speech, when he stated that he did not agree with some of the proposals. Based on the lack of any reference or follow-up to the Deficit Reduction Commission recommendations, I take it that the word "some" really meant that all the recommendations have been placed in the trash.

Based on the experience of the past, we are in for more smoke and mirrors that will claim that the deficit will somehow be "reduced" while it is actually being increased.