Making Sense of Our Fiscal Mess
The national debt was the top issue cited by voters when Gallup asked what the country's biggest problem would be in 25 years, but not everyone understands just how bad our country's finances are. After the first few trillions, people's eyes glaze over trying to count the zeros.

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On the edge of the abyss

Portugal's slow-growing economy, drastic loss of competitiveness and high public and private indebtedness are all weaknesses that markets might put to greater test.

If Portugal comes under intense pressure, contagion might then spread to Ireland, Italy or Spain, the other euro-area countries with some mixture of big budget deficits, poor growth prospects and high debts.

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A Majority Think Obama is Heading Toward Socialism

A buried nugget in the New York Times poll today: Among the general public, by 52-38 percent, people think "Barack Obama's policies are moving the country more toward socialism."

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Wrong Bill At The Wrong Time
ObamaCare and the downfall of the Democratic Party.

The real reason why ObamaCare is so unpopular is that it is proposing a giant expansion of the entitlement state precisely when this state everywhere is coming apart: here and abroad; at the federal level and the state; in the public sector and the private. Suggesting a giant government takeover of a sixth of the economy can't be a popular selling point in a country whose DNA has a programmed hostility to Big Government.

There are not enough taxpayers in the country or creditors in China capable of financing all these promises. Expanding this massive, multifarious entitlement state even more strikes most normal people as sheer lunacy--especially now that it is visibly coming apart at the seams.

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Obama simply does not have the popularity to carry unpopular legislation forward. Indeed, he is reaching a point where he may poll more negatively than his agenda does. "Let me be perfectly clear" and "make no mistake about it" are now caricatures.

So where are we at twelve months? Obama showed the country his vision of where he wanted us to go; he had both houses of Congress, a toady media, and enormous personal popularity — and he is getting nowhere. Why? Because most Americans are vehemently opposed to taking their country in the direction that Obama, Pelosi, and Reid would prefer.

Since Obama is both inexperienced and apparently a stubborn ideologue, I think all we will be left with when the novelty wears off is rhetoric and euphemism.

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CBO: Insurance Premiums Will Increase by 10% Under ObamaCare (Ace)

There are winners and losers here. If you've got insurance, you're a loser: Congratulations, you will now basically have a complete stranger's health care added to your premiums as if he's a member of your family, because you can afford it.

If you don't have insurance, you may be a winner... sort of. As regards primary effects you come out ahead -- free money! -- but there will be secondary effects, too, as all health care overall is driven to a lower quality.

Broken record time: This is and always was about only one thing. A fairly direct transfer of wealth, and the services that wealth buys, from the middle class to the lower class. There is plenty of reason for the uninsured and poor to support this plan; there is no reason for anyone middle-class and insured to support it. For the latter, there are no benefits whatsoever, and only costs -- except for the benefit of knowing you have basically added a stranger as a family member to your plan, and you can now enjoy the satisfaction of knowing all the extra money you're paying, and all the treatments you're personally be denied, are going to help someone else. Maybe.

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He needs to come down from his mountaintop because, in this country, only the faithful appreciate a president who consistently makes us listen to him, rather than the other way around.

So far, the signs aren't good. In his quest to surpass what he's done before and reprise his role as the nation's Moses, Obama appears to be on the verge of an "historic" remake of one-sixth of the American economy, namely health care - despite the fact that a solid majority of Americans oppose the change. Whatever the merits, pushing for major societal change without bringing society along is a guarantee of prolonged strife, and is as unprecedented in its own way as his election was. It is - dare we say it? - very George W. Bush-like in its disregard of the popular will; meaning that, in the ultimate irony, history may pair these two as mirror reflections of one another.

Right out of the box they propose sending people to jail for acting as economic subversives and economic traitors and yet I am, somehow, paranoid if I point out that the first step here is to reduce human freedom and increase state power.

And this is just a down-payment, remember. This is merely the first of many freedoms you previously believed sacrosanct to be lost. This is merely the first freedom they've realized, in advance, will have to be taken away. When their Rube Goldberg system of cross-subsidizations and stealth-rationing produces a slew of irrationalities and evasions they did not anticipate, we will have a welter of new crimes to correct all that human behavior they now find constitutes bad economic hygiene and must be outlawed.

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First, the White House announces a $250 payment to every senior for inflation that didn’t exist. “In effect, a COLA was paid on inflation that no longer existed,” notes Andrew Biggs of the American Enterprise Institute.

Second, the White House in its desperate attempts to get its health reform passed, has tasked the all-too-willing Majority Leader Reid to walk the plank by convincing him to push a $247 billion portion of health reform as an off-budget item, in a separate bill, to be on the Senate floor this week before moving to the merged ObamaCare bill. Even the Washington Post editorial board said “Mr. Reid proposes not to pay for any of it, not even $11 billion, but simply to write a $247 billion IOU.”

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Oct. 6 (Bloomberg) -- Barack Obama is considering a mix of spending programs and tax cuts to respond to widening job losses that would amount to an additional economic stimulus without carrying that label.

The problem is not, as Mr. Biden would have us believe, that the government didn’t spend enough, or that government bureaucracy is slowing the pace of stimulus spending, which it is. The problem is with a package that didn’t cut taxes enough or in all the right places. People have little confidence in government spending as a catalyst for economic growth and long term prosperity. They know that business creates jobs; government largely creates taxes, regulations and spends. The U.S. economy is burdened by: onerous regulations, the third highest corporate income tax rate (39.27 percent) in the world, and a combined state and federal personal income tax rate that can exceed 46 percent in certain states.

Despite all the money coming in, the U.S. national debt is now $11.2 trillion dollars, or 78 percent of U.S. GDP, and will likely be above 100 percent of GDP by the end of next fiscal year, surpassing the 1949 level of 97.5 percent which included costs associated with World War II and post war reconstruction.

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We are talking about a persistent and shared political-ideological alliance between President Obama and the complex of community, labor, and party organizations controlled by ACORN. Again, the Gaspard issue is new and needs further investigation and consideration. Yet preliminary indications are that the Gaspard-ACORN-Bertha Lewis-New Party-WFP-SEIU ties are significant, and tell us something disturbing about the political ideology and intentions of President Obama.

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“This is just the beginning. This is the first telephone call of a brand new conversation. We are just now learning how to really bring this community together to speak with the government...Bear with us as we learn the language so that we can speak to each other safely."

- Obama NEA Appointee

Thousands of readers have written to me asking how all this can happen in the U.S., where democratic principles have been recognized since the nation's founding. Many readers have written that they are "ashamed" of the U.S. and have asked, in effect, "How can I help Honduras?" A more pertinent question may turn out to be, how can they help their own country?

In its actions toward Honduras, the Obama administration is demonstrating contempt for the fundamentals of democracy. Legal scholars are clear on this. "Judicial independence is a central component of any democracy and is crucial to separation of powers, the rule of law and human rights," writes Ahron Barak, the former president of the Supreme Court of Israel and a prominent legal scholar, in his compelling 2006 book, "The Judge in a Democracy."

Feel the Gleichschaltung
Reading through this transcript, I was struck by two things. One was the aroma of self-intoxication. These bureaucrats and artists and activists are utterly besotted by the contemplation of their own virtue. They know what’s good for the country, and what’s good for you, and they’re willing to devote themselves ceaselessly to making it happen.

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Knowing the Endgame — in Chess and the Economy

In the agon we are considering, Barack Obama is an unskilled player. Timothy Geithner is an unskilled player. Larry Summers, Christina Romer, and Austan Goolsbee are unskilled players. (The jury is out on Ben Bernanke.) The moves they are now making will see to their embarrassment when they try to unkink the sinuosities of the endgame — assuming, as with my five-year-old, that they get that far. Indeed it appears that almost everyone in the administration is either an unskilled player, an old hack player (Joe Biden, Hillary Clinton), or a weirdo player (John Holdren, Van Jones).

This also appears to be the case with the Democratic Congress and its attendant RINOs. Duffers all or most. They cannot adhere, in Harry Frankfurt’s words, to “a disinterested and austere discipline” since they do not understand the game they are playing or are merely incapable of taking it seriously. They do not even read the bills that they pass. They are, in fact, prone to “some kind of laxity,” they are “trying to get away with something,” and they are blithely making up the rules as they go along. Frankfurt would not hesitate, despite his cachet as a Princeton philosopher, to call them bullsh*tters. But when one tackles a vital issue like the economy, there is no room for ignorance or frivolity — or bullsh*t.

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Diocletian's government lacked the machinery to enforce such a rigid pricing system on a day-to-day basis. Perhaps the most striking thing about the edict was its ambition - even if it was economically naive. Combined with the objective of profound change is the highly moral rhetoric. Talk of the 'peaceful state of the world' now that the 'seething ravages of barbarians peoples' have been restrained by great effort, is followed by outrage at a new evil attacking the soldiers. 'There burns a raging greed, which hastens to its own growth and increase without respect for human kind.' A little later the emperor compared this greed to a religion. The tone is typical of the other legislative activity of the tetrarchs and of their recorded rescripts - replies issued to legal questions and appeals sent to the emperor. The sense of outrage was accompanied by savage and often inventively cruel punishments.

Diocletian may genuinely have believed his own propaganda. He certainly felt that the best way to deal with the empire's problems was to impose strong central control. This was not a new idea. Bureaucracy had been growing in the last decades. The turnover of emperors was do rapid that officials, especially those of middle rank who were less likely to be purged when a regime changed, provided the most stable element in government. Diocletian stayed in power longer than his recent predecessors, his strength increasing with each passing year. He was therefore able to take much further the trend towards centralised government.

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The underlying motive of many Socialists, I believe, is simply a hypertrophied sense of order. The present state of affairs offends them not because it causes misery, still less because it makes freedom impossible, but because it is untidy; what they desire, basically, is to reduce the world to something resembling a chessboard.

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Turns out the $787 billion "American Recovery and Reinvestment Act" (AARA) was not designed for full economic recovery, but rather to "stabilize" the downturn. That's the word from White House officials today, who held off-camera briefings with reporters on how the AARA is working so far.

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Disarray. That's one word to describe the status of the Obama administration's legislative program as Congress heads into its final four weeks of work before the August recess...

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The Warwick businesswoman wrote to Government MPs: "I am ashamed of the leader of my country. His dictatorial leadership style, his grandiose spending, his questionable ethics, his inflated ego, his lack of transparency, his stirring up of racial hatred, are all hurting the fabric of our Island.

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All you have to do is recognize and acknowledge the true goal of the political class. It's summed up in one word: POWER. You think they actually give a flying Krispy Kreme about you? What? I know you were born at night, but was it last night? They may care about your vote .. but that's it. It's power, my friends. Power and little else.

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"The emperor needed the wealthier classes to help him run the empire. Senators in particular were the class he lived amongst and their attitude towards him tended to dictate how he would be portrayed in later histories."

- How Rome Fell, Adrian Goldsworthy

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America lost a further 467,000 non-farming jobs in June, pushing up the unemployment rate to 9.5%, a 26-year high.

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A cartoon on RedState featuring John Mayer/ABC/Obama.

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Obama is clearly to the left of Europe. He sees himself more as multicultural prophet born out of the Third World, foe of colonialism, angry at past imperialism, skeptical of capitalism, eager to showcase his non-traditional ancestry and tripartite nomenclature. By coming from the West, but separating himself from the history of his own country, Obama has become a citizen of the world, who polls far higher, as intended, in the Middle East, than does his own country.

Source

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"Are you better off today than you were four years ago?"

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(2) Chi-Comms and Times Get It, Obama Doesn't

The Federal Reserve is printing money from thin air, and the government is issuing trillions of dollars in new debt as it tries to spend its way out of the recession with a huge stimulus package, new lending programs, health care overhauls and automotive rescues.

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Judge Sotomayor has managed to take already liberal, redistributionist areas of the law and push them even further down the road in the direction of redistributing wealth to constituencies favored by government officials. The Supreme Court ruled in the Kelo case that governments can take private property and give it to developers as part of a general redevelopment plan that they rationally believe will benefit the public good.

But Judge Sotomayor went well beyond that, to hold that property owners have no legal redress even in the face of what legal commentators have called extortion, in Didden v. City of Port Chester. In that case, a developer told a property owner to either give him $800,000 or half his property, or he would seize it by having the Village of Port Chester condemn it. When the property owner refused, the developer promptly had the town condemn it and transfer it to him. Judge Sotomayor and two of her colleagues upheld this seizure against a constitutional challenge in an unpublished opinion.

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Now Congress is moving to limit the penalties on riskier borrowers, who have become a prime source of billions of dollars in fee revenue for the industry. And to make up for lost income, the card companies are going after those people with sterling credit.

Banks are expected to look at reviving annual fees, curtailing cash-back and other rewards programs and charging interest immediately on a purchase instead of allowing a grace period of weeks, according to bank officials and trade groups.

“It will be a different business,” said Edward L. Yingling, the chief executive of the American Bankers Association, which has been lobbying Congress for more lenient legislation on behalf of the nation’s biggest banks. “Those that manage their credit well will in some degree subsidize those that have credit problems.”

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Every day one sees yet another shop being abandoned and boarded up; in London some local authorities are allowing charities and small groups to move into abandoned shop premises rather than let them become damp-ridden dumps. As this unfolds, members of Parliament are reported to have been claiming £18,000 for a bookcase and £6,000 for a wooden floor, while engaging in complicated “flipping” arrangements in which they received payments for switching homes every so often.

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...the Obama people might think there's some sort of moral equivalence between Israel and Iran.

They don't think that at all. In their minds Israel is the colonial power oppressing the peaceful Muslims who just want to blow the infidel up in peace. Hussein Obama and the leftists know in their hearts that Israel and the U.S. need to be destroyed because they are the root of all evil.

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trough (noun) - a long, narrow, open receptacle, usually boxlike in shape, used chiefly to hold water or food for animals.

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Obama defends budget as deficit forecast surges
The nonpartisan Congressional Budget Office (CBO) forecast Friday the deficit could hit 1.845 trillion dollars this year under the Obama proposal, quadrupling the 2008 record shortfall.

The CBO said its latest budget deficit estimate for fiscal 2009, which ends on September 30, would amount to 13.1 percent of the country's total economic output.

China buying boosts gold to 3-week high
"China is protecting its huge currency risk by diversifying with gold as well as other currencies like the euro. This is prudent," said Frank Holmes, chief executive officer of U.S. Global Investors, which manages more than $2 billion in fund assets.

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You look at the political expediency and the political objective of these leaks. Obama was elected by running against George Bush, even though he wasn't on the ballot. He has been running against Bush in the first 100 days. He ran against Bush when he was in Europe and in Trinidad. He's making himself the foil against Bush.

And you would expect that has to end after a few months. Well, with the torture issue, it doesn't end. It's a perfect way to keep Bush alive as the permanent nemesis and foil of Obama.

And what he's doing is by strategically releasing a memo here, a memo there, he creates a firestorm, which is all predictable, which is not going to end up in prosecutions. It will end up in a truth commission.

You will have all kinds of Congressional hearings. You will have all kinds of commissions. You will have leaks. You will have televised, very dramatic testimony.

This issue, the Bush issue, will be alive for a long time.

Source

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Obama’s $100 Million Cut

It is 1/40,000 of the federal budget;

It is 1/7,830 the size of the recent “stimulus” bill;

It would close 1/1,845 of this year’s budget deficit;

It is the amount the federal government spends every 13 minutes; and

For a family earning $40,000 annually, it is the equivalent of cutting $1 from their family budget.

Seriously. President Obama has reportedly been working closely with noted behavioral economists, and their studies have shown that most people are “insensitive to scope,” meaning they are not very good at putting large numbers in their proper context. People will react about the same to a policy proposal whether the cost/benefit is $10 million, $10 billion, or $10 trillion. Consequently, the $100 million cut may seem huge to many voters.

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If Obama were to give a major address, say, on the state of U.S. relations with the Muslim world, it would be silly to do it at such a venue. So too bad for Georgetown and other religiously affiliated schools. But the idea that, as a general matter, when the president is speaking about budget and economic priorities, he shouldn't do it if there's a chance someone will see him near a religious symbol, well, that's absurd. Real pluralism means pluralism of institutions. When the living embodiment of the executive branch shows up, that shouldn't mean that all religious images need to be hidden. It means, perhaps, they should be polished.

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The Ship is Sinking: Quick, Add Water (RealClearPolitics)

President Obama has reminded us countless times that he inherited a $1.3 trillion deficit. Even if he were about to propose the most responsible, prudent, visionary budget imaginable, that complaint would still be petulant and unseemly. But considering what Obama's own spending will do to the deficit, it's jaw-droppingly galling. He now proposes to increase that deficit to $7 trillion in 10 years. And that $7 trillion is probably a low estimate (the Congressional Budget Office estimates that it will be $2.3 trillion higher). When the new spending for programs like Pell Grants, education for handicapped children and so forth comes up for renewal in a few years, Congress is not going to let it lapse. So, to review, it was terrible for President Bush and the Democratic Congress (the president neglects to mention them) to saddle him with all this debt. His answer is to triple it. That's showing 'em!

Washington’s Socialist Spendathon: The federal bailout exceeds 90 percent of U.S. GDP. If that isn’t socialism, what is?

Bloomberg News has tallied Washington’s spending and promises as it props up banks, insurers, automakers, and seemingly everyone except hardworking taxpayers who promptly pay their bills. Bloomberg deserves great credit for focusing on this constantly moving target. In its latest estimate, Bloomberg correspondents Mark Pittman and Bob Ivry reported on March 31 that the Federal Reserve, Treasury, Federal Deposit Insurance Corporation, and Department of Housing and Urban Development have saddled taxpayers with $12.8 trillion so far. America’s 2008 gross domestic product was $14.2 trillion. Hence, the federal bailout now equals 90.14 percent of GDP.

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