What you gonna do when she says goodbye? What you gonna do when she is gone? So Benny’s havin’ trouble with his printing press, cause things just aren’t working out the way they should. Well you better check it out before it goes. Cause you may not be seein' things just the way you should. And you don't recognize what everybody knows… Sorry Pablo for the pun on your song, but sometimes a little humor goes a long way.
Well, well, well! We have yet another popped economic bubble on our hands here, and ‘ol Benny is running out of options. Maybe he needs a stronger soap, or maybe there was an outside culprit. Those awful people at Standard and Poors should be shot, and Michael Moore is going to lead the charge. Everything was fine they took our triple-A status away! Well, Mr. Moore, how about you indulge in one or two of your favorite McDonald’s combo meals while contemplating another tripe filled documentary. Leave the analysis of the situation to those with real expertise.
Houston, we have a problem. Our debt now exceeds 100 percent of our nation’s gross domestic product, our dollar is currently on life support from world banks and misguided investors, the quantitative easing packages have failed; and another bubble is not available to inflate to fool the public into thinking the economy is on the right track. In addition, those meanies at the S&P have gone out on a mild limb with their current downgrade. Worse, the public many not buy into the fact that more spending is necessary to revive the economy. Bernake’s house of cards is about to collapse.
The meanies at S&P are weak bullies, so relax Mr. Moore. The downgrade is years too late and far too mild because it STILL does not reflect America’s current debt position. So all your leftist, Keynesian buddies got was a little slap on the hand with a message that goes something like “Hey guys, can you tone it down just a little bit here? This is getting serious now. We can’t cover for much longer.” Yet, Moore wants to shoot these people, but where were his feelings of rage when S&P, Moody’s and Fitch were giving triple-A stamps to JUNK bonds four years ago…you know the huge bubble that burst, which put the disaster ball in motion?
Returning to our good friend Bernanke, he has a very unique problem. QE1 and QE2 have successfully inflated the stock market, but now that bubble has burst. It’s difficult to believe that during the crash of 2008, people still sought shelter in the U.S. dollar, and it’s even more difficult to believe that DOWNGRADED long-term U.S. treasury bonds were the safe haven this time around. Some investors are always behind the eight ball, but soon there won’t be any place to go. Bernanke will not be able to engage in this pump-priming much longer. How much farther can we go…until debt exceeds 130 percent of GDP? How about 140? Do I hear 150? How many times are we going to go in the same circle? Prime the pump, raise the stock market, market crashes, prime the pump, raise the stock market, market crashes… He’s been trying to re-inflate the housing bubble, but there is a hole in the other side.
Bernake’s decision to keep rates still until 2013 is an admission of complete failure. It also exposes the fact that the “recovery” was bogus and sends a message of further uncertainty to businesses that will continue to mitigate risk and sit on capital. In addition, Bernake’s decision to keep rates low will guarantee the dollar’s demise against foreign currencies. Sadly, this won’t change how Washington will react. Spending will continue, the Fed will engage in more pump priming once the T-bond rally dies, and it’s possible that the debt ceiling might have be raised before 2013.
The end of the line is near. My question is who is going to bail out the U.S. when the dollar loses its world reserve status? The only reason why we have been able to get away with reckless monetary policy is because the U.S. dollar is the world reserve currency. Greece, Spain and Italy didn’t have that luxury, and soon we won’t either.
It’s been time to pull out of the U.S. dollar, but as more and more investors slowly wake up, world banks won’t be able to prop it up. G-7 had an awful time this spring when Japan had to divert away from treasury bonds to address its own natural disasters. When enough people see that it is completely senseless to flock to downgraded debt, the fiat charade will come to an end.
Wednesday, August 10, 2011
Monday, August 8, 2011
America as the World Superpower 1945-2011
By Mike Porter
The eighth month of the year 2011 will be remembered for years to come. August of this year will forever be a stain on America’s history much like September of 2001 for the terrorist attacks as well as September of 2008 for the financial collapse. August of 2011 delivered two significant and permanent financial setbacks to the American economy. The first being America’s debt beginning to eclipse the country’s GDP for the first time since 1947 and the second being the first ever downgrade of United States Treasury bonds. I find it ironic that the same month America dropped the atomic bombs which lead to the beginning of America as a world superpower, sixty-six years later our government essentially drops a bomb on the US economy ending our reign as the lone superpower in the world. Our fall from Super Power status has been a long time coming and many wonder where do we go from here.
First, let’s address the downgrade of the S&P and why this is so significant. S&P is a credit rating agency who for the first time ever believes there may be some doubt about whether or not the US may be able to pay the people who invest in US backed securities. This is no different than a bank lowering the credit rating of a faulty business or a family who is living beyond their means. Why shouldn’t S&P believe this with over 14 trillion in outstanding debt? Many naysayers will make the false argument that S&P is only one credit agency who has dropped our status and a credit rating of AA+ is still a very good rating. I do not share this blind optimism and strongly believe the other credit agencies will soon follow suit. Suppose they are right, there is still no way a country can continue to make the claim they are a super power when as many as one single credit agency do not think we are the best in the world. I believe many of these same people would still say everything was fine if our rating was even lower. Others wonder what took S&P so long to come to this conclusion with so much outstanding debt. It is obvious S&P took notice to the recent raising of the debt ceiling which contained further additional spending providing more proof nobody in Washington will get serious about lowering the size of government. While the market was hemorrhaging to the tune of more than 600 points today, Obama addressed the nation by simply regurgitating the same old tired rhetoric claiming more wealthy people need to pay their fair share as if they don’t already. Meanwhile for the first time in history, America’s credit rating has fallen on his watch and his policies are much to blame for this downgrade.
Debt exceeding GDP should not be a surprise to anyone. America has been on an unsustainable spending path for many years now. We can start with GW Bush and the Republican controlled Congress. Expansion of Medicare drug benefits, No Child Left Behind, TARP, Sarbanes-Oxley, and Office of Homeland security being only a few of the many government expansions coming from the so called “right wing” party. While I personally do not have a problem with Bush’s decision to take us to war in Afghanistan or Iraq, I do blame him for not fighting the financial side of these wars. Then along came Obama, who along with the Democratic controlled Congress, expanded on Bush’s policies and spent even more money like nothing ever seen before. One doesn’t have to look past Washington to find out how we got ourselves in this mess.
Where do we go from here? Well for starters we have to accept the fact we are no longer a superpower. Although we still do have a lot of influence in the world, we have to cease behaving like a Superpower. First, it is time to get serious about entitlements, and that has to come from you the people. You need to call your representative and tell them you are tired of paying for entitlement programs and you are willing to take less in benefits later if it means keeping more money in your paycheck today. Second, I am sorry to say we have to re-evaluate everywhere where we have troops stationed today. We have to identify the locations where it still makes sense in areas that pose a risk and draw down in areas that are less important. In these less important areas remaining military bases should be closed. I have had many disagreements in the past with both my Liberal and Libertarian friends on “policing the world” and while I feel some of our foreign policy entanglements helped us preserve our status in the world, it is just as clear today we can no longer maintain this activity when we are no longer a Superpower. Next, we have to review all foreign aid including how much is given to the United Nations every year. Last, but not least, we need to revamp our tax code as well as remove hindering business regulations which causes the private sector tons of money and always come at the expense of American jobs and wages.
Only after we address these things can we even begin to get things under control. Failure to do so will mean more credit downgrades and eventually the collapse of the US dollar. Many believe this collapse has already begun with gold and commodity prices going higher and higher as the dollar loses more purchasing power. Many in ancient Rome refused to believe Rome was falling, even though the evidence was overwhelming. The United States has been falling for some time now and I am afraid things are only going to get worse. Without a serious turnaround get used to high unemployment and a weak devalued currency which hopefully for our sake never gets as bad as the Pre WWII German Mark. However, with interest rates at practically zero and high unemployment, the only thing left for the Fed to do is to continue printing money until it is worthless. My best guess is the Fed is hoping things turn around before they are forced to raise interest rates. Unfortunately, someone needs to tell the Fed that too much printing of our own money is what caused us to lose our Superpower status in the first place.
Sources:
(1) http://news.yahoo.com/us-aaa-rating-still-under-threat-204040123.html
(2) http://news.yahoo.com/p-downgrades-us-credit-rating-080422314.html
(3) http://finance.yahoo.com/news/Wall-St-takes-a-dive-on-first-apf-1960115615.html?x=0
The eighth month of the year 2011 will be remembered for years to come. August of this year will forever be a stain on America’s history much like September of 2001 for the terrorist attacks as well as September of 2008 for the financial collapse. August of 2011 delivered two significant and permanent financial setbacks to the American economy. The first being America’s debt beginning to eclipse the country’s GDP for the first time since 1947 and the second being the first ever downgrade of United States Treasury bonds. I find it ironic that the same month America dropped the atomic bombs which lead to the beginning of America as a world superpower, sixty-six years later our government essentially drops a bomb on the US economy ending our reign as the lone superpower in the world. Our fall from Super Power status has been a long time coming and many wonder where do we go from here.
First, let’s address the downgrade of the S&P and why this is so significant. S&P is a credit rating agency who for the first time ever believes there may be some doubt about whether or not the US may be able to pay the people who invest in US backed securities. This is no different than a bank lowering the credit rating of a faulty business or a family who is living beyond their means. Why shouldn’t S&P believe this with over 14 trillion in outstanding debt? Many naysayers will make the false argument that S&P is only one credit agency who has dropped our status and a credit rating of AA+ is still a very good rating. I do not share this blind optimism and strongly believe the other credit agencies will soon follow suit. Suppose they are right, there is still no way a country can continue to make the claim they are a super power when as many as one single credit agency do not think we are the best in the world. I believe many of these same people would still say everything was fine if our rating was even lower. Others wonder what took S&P so long to come to this conclusion with so much outstanding debt. It is obvious S&P took notice to the recent raising of the debt ceiling which contained further additional spending providing more proof nobody in Washington will get serious about lowering the size of government. While the market was hemorrhaging to the tune of more than 600 points today, Obama addressed the nation by simply regurgitating the same old tired rhetoric claiming more wealthy people need to pay their fair share as if they don’t already. Meanwhile for the first time in history, America’s credit rating has fallen on his watch and his policies are much to blame for this downgrade.
Debt exceeding GDP should not be a surprise to anyone. America has been on an unsustainable spending path for many years now. We can start with GW Bush and the Republican controlled Congress. Expansion of Medicare drug benefits, No Child Left Behind, TARP, Sarbanes-Oxley, and Office of Homeland security being only a few of the many government expansions coming from the so called “right wing” party. While I personally do not have a problem with Bush’s decision to take us to war in Afghanistan or Iraq, I do blame him for not fighting the financial side of these wars. Then along came Obama, who along with the Democratic controlled Congress, expanded on Bush’s policies and spent even more money like nothing ever seen before. One doesn’t have to look past Washington to find out how we got ourselves in this mess.
Where do we go from here? Well for starters we have to accept the fact we are no longer a superpower. Although we still do have a lot of influence in the world, we have to cease behaving like a Superpower. First, it is time to get serious about entitlements, and that has to come from you the people. You need to call your representative and tell them you are tired of paying for entitlement programs and you are willing to take less in benefits later if it means keeping more money in your paycheck today. Second, I am sorry to say we have to re-evaluate everywhere where we have troops stationed today. We have to identify the locations where it still makes sense in areas that pose a risk and draw down in areas that are less important. In these less important areas remaining military bases should be closed. I have had many disagreements in the past with both my Liberal and Libertarian friends on “policing the world” and while I feel some of our foreign policy entanglements helped us preserve our status in the world, it is just as clear today we can no longer maintain this activity when we are no longer a Superpower. Next, we have to review all foreign aid including how much is given to the United Nations every year. Last, but not least, we need to revamp our tax code as well as remove hindering business regulations which causes the private sector tons of money and always come at the expense of American jobs and wages.
Only after we address these things can we even begin to get things under control. Failure to do so will mean more credit downgrades and eventually the collapse of the US dollar. Many believe this collapse has already begun with gold and commodity prices going higher and higher as the dollar loses more purchasing power. Many in ancient Rome refused to believe Rome was falling, even though the evidence was overwhelming. The United States has been falling for some time now and I am afraid things are only going to get worse. Without a serious turnaround get used to high unemployment and a weak devalued currency which hopefully for our sake never gets as bad as the Pre WWII German Mark. However, with interest rates at practically zero and high unemployment, the only thing left for the Fed to do is to continue printing money until it is worthless. My best guess is the Fed is hoping things turn around before they are forced to raise interest rates. Unfortunately, someone needs to tell the Fed that too much printing of our own money is what caused us to lose our Superpower status in the first place.
Sources:
(1) http://news.yahoo.com/us-aaa-rating-still-under-threat-204040123.html
(2) http://news.yahoo.com/p-downgrades-us-credit-rating-080422314.html
(3) http://finance.yahoo.com/news/Wall-St-takes-a-dive-on-first-apf-1960115615.html?x=0
Wednesday, August 3, 2011
America Sold Down the River Again With the Debt Ceiling Vote
Do you find yourself humming that tune? “I don’t know why, I don’t understand how you sold me down the river...” If so, I hope that you learned your political lesson. If anyone is shocked by the results of the debt ceiling vote, then they have much to learn.
After weeks of the dog and pony show coupled by horrendous acting, America ends up with a bill that increases spending and adds to the debt. Surprise, surprise! I only wish that the dreadful drama would cease. Now, we have Democrats saying this bill is far too extreme because it “cuts” too much, Republicans are good little stooges for “compromising;” and the tea party is destroying America by putting too much pressure on “moderate” Republicans. Shall we translate this nonsense? All right then…
Let’s begin with the tea party because they play the largest role in this charade. I’ve said time and time again that those who TRULY want to see government’s stranglehold on the economy diminish, it will NOT be accomplished through the Republican Party. It’s no surprise that “establishment” Republicans such as Eric Cantor and Mitch McConnell voted for this turkey, but a good number of so called tea party members also voted in favor. Shall we examine presidential hopeful Michele Bachmann’s caucus for a sample? Of the 60, a whopping 32 of them (including the beloved Allen West) voted in favor; and these are just members of Bachmann’s caucus! Other tea party favorites such as Paul Ryan voted in favor as well. I’m not sure what Democrats fear because the majority of the tea party is on their side; however, it’s important to dupe the voting masses into believing they are on opposite ends of the spectrum. Calling them terrorists fits the bill!
Now, we’ll sift through the pure nonsense from leftists like Paul Krugman and Democrats who voted against this bill because the spending cuts are too deep. First of all, this bill doesn’t cut spending. What it does do is cut money that HASN’T been spent yet. For example, if the U.S. plans to add $10 trillion to the debt over the next decade, the “spending cuts” in place will only allow $7.5 trillion dollars to be added to the debt. This does not even come close to satisfying credit agencies, which is what all of the fuss was over in the first place. In order for the U.S. to maintain its triple-A rating, $4 trillion must be trimmed from the deficit according to Standard & Poors.
Welcome to leftist math! Harsh spending cuts come from cutting a silver lining off of spending INCREASES! Put simply; imagine if your spouse tells you that he/she has saved the household $250,000. When you ask how so, he/she tells you that buying a Ferrari next year won’t happen, so can we borrow more money now for that vacation in Aspen? Yes, it’s just that simple folks.
The new bill only addresses cuts in discretionary spending, and worse, the bulk of these cuts are pushed back towards the latter part of the decade. In other words, no cuts will take place until after the 2012 election. How convenient! Also, this “committee” could change hands over the years, which means that any of the proposed spending cuts can be rendered null and void by a different Congress. Therefore, when the American people throw the Republicans out and re-elect Democrats for more “hope and change,” they can revise this bill. If that’s not enough, there have been SEVENTEEN bipartisan committees since 1982 assigned to reduce spending. All seventeen have failed, obviously. What makes anyone think the 18th will succeed?
In addition, discretionary spending is NOT the problem. Entitlements, defense spending and spending for all of these “emergencies” that arise ARE the problem! There are no provisions in this bill that even try to establish limits in these areas.
After all the smoke is cleared; and after all of the “tough talk” by the GOP that fooled so many, this is what we wind up with – barely a 20 percent cut to INCREASES in spending! I love bipartisanship; don’t you? The sad thing is that time is running out for lawmakers to kick the can down the road. How much longer are you going to watch lawmakers contribute to the demise of the U.S. economy? Arguing over whether or not this explosion will hit in 5 or 20 years is completely irrelevant. Who cares how far down the road the end of the cliff is?! Are we going to keep on driving towards it?
After weeks of the dog and pony show coupled by horrendous acting, America ends up with a bill that increases spending and adds to the debt. Surprise, surprise! I only wish that the dreadful drama would cease. Now, we have Democrats saying this bill is far too extreme because it “cuts” too much, Republicans are good little stooges for “compromising;” and the tea party is destroying America by putting too much pressure on “moderate” Republicans. Shall we translate this nonsense? All right then…
Let’s begin with the tea party because they play the largest role in this charade. I’ve said time and time again that those who TRULY want to see government’s stranglehold on the economy diminish, it will NOT be accomplished through the Republican Party. It’s no surprise that “establishment” Republicans such as Eric Cantor and Mitch McConnell voted for this turkey, but a good number of so called tea party members also voted in favor. Shall we examine presidential hopeful Michele Bachmann’s caucus for a sample? Of the 60, a whopping 32 of them (including the beloved Allen West) voted in favor; and these are just members of Bachmann’s caucus! Other tea party favorites such as Paul Ryan voted in favor as well. I’m not sure what Democrats fear because the majority of the tea party is on their side; however, it’s important to dupe the voting masses into believing they are on opposite ends of the spectrum. Calling them terrorists fits the bill!
Now, we’ll sift through the pure nonsense from leftists like Paul Krugman and Democrats who voted against this bill because the spending cuts are too deep. First of all, this bill doesn’t cut spending. What it does do is cut money that HASN’T been spent yet. For example, if the U.S. plans to add $10 trillion to the debt over the next decade, the “spending cuts” in place will only allow $7.5 trillion dollars to be added to the debt. This does not even come close to satisfying credit agencies, which is what all of the fuss was over in the first place. In order for the U.S. to maintain its triple-A rating, $4 trillion must be trimmed from the deficit according to Standard & Poors.
Welcome to leftist math! Harsh spending cuts come from cutting a silver lining off of spending INCREASES! Put simply; imagine if your spouse tells you that he/she has saved the household $250,000. When you ask how so, he/she tells you that buying a Ferrari next year won’t happen, so can we borrow more money now for that vacation in Aspen? Yes, it’s just that simple folks.
The new bill only addresses cuts in discretionary spending, and worse, the bulk of these cuts are pushed back towards the latter part of the decade. In other words, no cuts will take place until after the 2012 election. How convenient! Also, this “committee” could change hands over the years, which means that any of the proposed spending cuts can be rendered null and void by a different Congress. Therefore, when the American people throw the Republicans out and re-elect Democrats for more “hope and change,” they can revise this bill. If that’s not enough, there have been SEVENTEEN bipartisan committees since 1982 assigned to reduce spending. All seventeen have failed, obviously. What makes anyone think the 18th will succeed?
In addition, discretionary spending is NOT the problem. Entitlements, defense spending and spending for all of these “emergencies” that arise ARE the problem! There are no provisions in this bill that even try to establish limits in these areas.
After all the smoke is cleared; and after all of the “tough talk” by the GOP that fooled so many, this is what we wind up with – barely a 20 percent cut to INCREASES in spending! I love bipartisanship; don’t you? The sad thing is that time is running out for lawmakers to kick the can down the road. How much longer are you going to watch lawmakers contribute to the demise of the U.S. economy? Arguing over whether or not this explosion will hit in 5 or 20 years is completely irrelevant. Who cares how far down the road the end of the cliff is?! Are we going to keep on driving towards it?
Wednesday, July 27, 2011
Nick Gillespie on Bill Maher
Political talking heads on TV are not my cup of tea. Apart from a good laugh, I don’t have much use for them. Anything I see is usually emailed to me in a video clip or snagged off of someone’s Facebook page. Much to my surprise, Bill Maher had a libertarian guest on his show…not just any libertarian, but Nick Gillespie – editor in chief of Reason TV and reason.com. He did very well considering that it’s virtually impossible to dumb down his position enough so Bill Maher and his viewers can understand. On top of that, he had to combat the usual childish, amateur debate tactics of a discussion panel skewed in the opposition’s favor. Childish/amateur debate tactics defined:
1) A perverse version of identity politics.
If an argument cannot be countered with facts, sound reasoning and logic, then throw the person in the camp with the “enemy.” It makes no difference that Gillespie did not endorse any plan (Republican or Democrat) currently on the table. It’s important to cover up the fact that Nick Gillespie is the only TRUE liberal on that stage. We can’t have people figuring that one out! Because he is not in favor of raising the debt ceiling, then he is an evil Republican. The comical thing about this is during the debate, they proved that there was no difference between the two parties since Obama was the one who played fiscal warrior when Republicans were spending money recklessly under Bush. Nonetheless, this tactic works very well with robotic audiences. Simply label your opponent as the enemy, and then the audience will tune him out.
2) Sputtering out baseless claims that detract from the original topic… such as “wages have not gone up in 30 years” and “tax revenue has decreased.”
Neither of these points have anything to do with the debt ceiling issue. The first is blatantly false. Wages depend heavily on the state of the economy, industry, demand for the type of work and one’s level of education. While global competition and less demand for certain jobs have caused wages to decline or remain stagnant, it is beyond disingenuous to generalize it to apply to ALL wages. It was interesting that the subject was changed when Nick mentioned the weakening of people’s purchasing power due to inflation as a key issue. In addition, there wasn’t a chance to discuss the parallel between the rapid growth of government at the expense of the private sector.
The tax revenue argument is a very easy one to debunk, but I don’t blame Nick for not delving too much into this. Maher was right there to back him into defending the Bush tax cuts (thus helping with his identity politics approach), which would deviate further from the matter at hand. It is noteworthy to point out that tax revenues (like wages) depend heavily on the macroeconomic environment. I won’t spend much time on this topic either since I abhor the current income tax system. Taxing income and using the tax code as a market steering effort is extremely flawed and is nothing more than another avenue of centralized planning. If we are not talking about the “Fair Tax,” then we are not talking!
The only thing to take away from this is that Nick correctly pointed out that the government has a spending problem. After the Bush tax cuts, the government collected enough tax revenue to actually CURB the deficit in 2006 in spite of all of the reckless spending and funds needed to fight two wars.
Last but not least, 3) mischaracterizing the issue at hand…
Maher’s intellectual void when it comes to economics is downright scary sometimes. Nick laughably characterized it as “junkie” logic. Put simply, the government does NOT have to raise the debt ceiling to avert default. Have any of you stopped paying your federal payroll taxes? Are there any self-employed people not making estimated tax payments? The government is still collecting revenue on a daily basis. To expand on Maher’s flawed analogy, maybe we don’t “go out to eat” this Friday so we can pay for all of our dinner bills coming due!
The only thing the decision to not raise the debt ceiling amounts to is that the government cannot apply for a credit line increase. It must use the funds it currently HAS and is still COLLECTING to pay its bills. Do businesses fold if they are denied a credit line increase? Does a family have to file for bankruptcy if they are denied an additional credit card? Wake up and smell the coffee America. The rug is being pulled over your eyes once again.
1) A perverse version of identity politics.
If an argument cannot be countered with facts, sound reasoning and logic, then throw the person in the camp with the “enemy.” It makes no difference that Gillespie did not endorse any plan (Republican or Democrat) currently on the table. It’s important to cover up the fact that Nick Gillespie is the only TRUE liberal on that stage. We can’t have people figuring that one out! Because he is not in favor of raising the debt ceiling, then he is an evil Republican. The comical thing about this is during the debate, they proved that there was no difference between the two parties since Obama was the one who played fiscal warrior when Republicans were spending money recklessly under Bush. Nonetheless, this tactic works very well with robotic audiences. Simply label your opponent as the enemy, and then the audience will tune him out.
2) Sputtering out baseless claims that detract from the original topic… such as “wages have not gone up in 30 years” and “tax revenue has decreased.”
Neither of these points have anything to do with the debt ceiling issue. The first is blatantly false. Wages depend heavily on the state of the economy, industry, demand for the type of work and one’s level of education. While global competition and less demand for certain jobs have caused wages to decline or remain stagnant, it is beyond disingenuous to generalize it to apply to ALL wages. It was interesting that the subject was changed when Nick mentioned the weakening of people’s purchasing power due to inflation as a key issue. In addition, there wasn’t a chance to discuss the parallel between the rapid growth of government at the expense of the private sector.
The tax revenue argument is a very easy one to debunk, but I don’t blame Nick for not delving too much into this. Maher was right there to back him into defending the Bush tax cuts (thus helping with his identity politics approach), which would deviate further from the matter at hand. It is noteworthy to point out that tax revenues (like wages) depend heavily on the macroeconomic environment. I won’t spend much time on this topic either since I abhor the current income tax system. Taxing income and using the tax code as a market steering effort is extremely flawed and is nothing more than another avenue of centralized planning. If we are not talking about the “Fair Tax,” then we are not talking!
The only thing to take away from this is that Nick correctly pointed out that the government has a spending problem. After the Bush tax cuts, the government collected enough tax revenue to actually CURB the deficit in 2006 in spite of all of the reckless spending and funds needed to fight two wars.
Last but not least, 3) mischaracterizing the issue at hand…
Maher’s intellectual void when it comes to economics is downright scary sometimes. Nick laughably characterized it as “junkie” logic. Put simply, the government does NOT have to raise the debt ceiling to avert default. Have any of you stopped paying your federal payroll taxes? Are there any self-employed people not making estimated tax payments? The government is still collecting revenue on a daily basis. To expand on Maher’s flawed analogy, maybe we don’t “go out to eat” this Friday so we can pay for all of our dinner bills coming due!
The only thing the decision to not raise the debt ceiling amounts to is that the government cannot apply for a credit line increase. It must use the funds it currently HAS and is still COLLECTING to pay its bills. Do businesses fold if they are denied a credit line increase? Does a family have to file for bankruptcy if they are denied an additional credit card? Wake up and smell the coffee America. The rug is being pulled over your eyes once again.
Friday, July 15, 2011
President Obama’s Truth about the Debt Ceiling
Almost three years into Obama’s term, my opinion about him has changed. He’s one of our better Presidents because he has told the truth and exposed all of the myths about our monetary policy from each side of his mouth.
For the past several weeks, I have listened to the smoke and mirrors game being played regarding the debt ceiling. Republicans are pretending to act like fiscal warriors…never mind the fact that size of our debt doubled in President Bush’s 8 years, and MANY Republicans voted to RAISE the debt ceiling during their reign in Congress. Their recent “heroic” acts certainly do not cut any ice with me, especially because spending has still been escalating since their 2010 takeover.
Let us now return to President Obama since the man has been telling the truth since 2006. It’s too bad that we do not have Senator Obama’s ideas from 2006. This particular Obama voted against raising the debt ceiling; and he had this to say about the fiscal status of our nation:
“The fact that we are here today to debate raising America’s debt limit is a sign of leadership failure. It is a sign that the U.S. Government can’t pay its own bills. It is a sign that we now depend on ongoing financial assistance from foreign countries to finance our Government’s reckless fiscal policies. Increasing America’s debt weakens us domestically and internationally. Leadership means that ‘the buck’ stops here. Instead, Washington is shifting the burden of bad choices today onto the backs of our children and grandchildren. America has a debt problem and a failure of leadership. Americans deserve better.”
This side of Obama is one who may have engaged in a libertarian acid trip…yet another reason to end the war on drugs! On a more serious note, let’s give him kudos for confessing the fact that the United States has been engaged in reckless monetary policy. Now, shall we examine his recent rhetoric?
Obama claims that if we do not raise the debt ceiling, the U.S. will not be able to pay the interest on its loans which would result in default. Our debt rating will be downgraded. Disaster will ensue! How many of you would like to raise your debt ceiling when you cannot pay your bills? Being fiscally responsible isn’t any fun! Why cut spending when you can just borrow more? So…what truth has Obama revealed? He is saying that the United States does not have the desire nor does it have to engage in fiscal responsibility since it owns a printing press. What the President should be doing is assuring our creditors that the United States will meet its obligations; however, if he doesn’t SCARE people and the markets into believing disaster will occur, then he cannot carry on the same reckless fiscal policies.
Obama must be convinced that the real disaster will not come during his watch. The day will come where our creditors will create a debt ceiling for us. After all, Obama’s recent confession shows just how close we are to being capped. He’s basically confessed that we cannot pay our bills without having to borrow more money. The printing press cannot print forever either for those of you who are naïve enough to think inflation has been averted.
When the going gets tough, the tough don’t have to get going in Washington. All they simply need to do is scare the daylights out of old people. It works like a charm every time, and it has political clout since our seniors comprise a major voting bloc. If President Obama is telling the truth that money will run out by August 3rd to issue social security checks, then he has admitted that there are no social security trust funds! Furthermore, this proves that social security is nothing more than a government-run Ponzi scheme. Bernie Madoff went to jail – he should have worked for the government.
As always, it’s up to the American people to change things. The U.S. government is in this predicament because so many people have become dependent on government programs. Politicians do not care about the future of the country. They care about staying in office; and they are not going to cut programs that their constituents depend upon unless people decide to cut the government umbilical cord themselves.
For a new nation, thing have changed awfully fast – especially over the past 100 years. We’ve allowed the monopoly. We have sold out. We now want government to make the decisions for us, even for the most critical things in life like medical care and retirement planning. We also protect the world by offering free security at the taxpayers’ expense. The endless foreign wars we have been engaged in both now and in the past have reached astronomical costs. We have successfully surrendered our freedoms, and as a result, we have an out-of-control tyrannical government that has weakened our status as a nation.
We have traded a free market for a sickening version of statism with regulatory policy to “protect us” being written by the very lobbyists who are publically despised. This has allowed several big corporations (our large banking institutions and General Electric among them) and major universities that corrupt our young adults to become nothing more than another extension of government.
History does not lie. Countries have been down this road before. The fiat currency system is failing. Ireland needs another bailout, and the Eurozone, as a whole, is becoming increasingly unstable. America cannot pay its bills without plunging further into debt.
Maybe it’s time for people to abandon the TV remote and pay more attention to the major loss of freedoms we as a nation have endured. I say this because there are still a vast amount of politically challenged people out there. For example, those who still believe there is a difference between Democrats and Republicans simply because they focus only on meaningless rhetoric.
How many people believe what President Obama is saying about the debt ceiling, when he had the opposite position four years ago? How many knew his position four years ago? How many seniors are scared to death that their social security will stop? The majority of the American population doesn’t know what constitutes the left and right wing since most will say the “evil right wing” is taking away their social security. In America, social authoritarians and war hawks are called right wing. Amazing! For a better understanding of the political spectrum, give this video seven minutes of your time:
The Political Spectrum Explained
On the brink of the 2012 election, the GOP’s top priority comes from a radical Christian group in Iowa asking candidates to sign a pledge which is not only horribly discriminatory, but it is the antithesis of the principles in which this country was founded. If that’s not bad enough, I am at a loss for words to explain how Mitt Romney, the father of universal healthcare, could be one of the top contenders. Also at the top is Michele Bachmann who seems to think homosexual couples are more dangerous than the power of the Federal Reserve.
Politicians could never get away with such lies and treachery if the ‘masses’ were a bit more educated; yet some people believe that libertarians like me are the ones who lack insight. Libertarians who stand for social and economic liberalism are the true champions and defenders of freedom.
For the past several weeks, I have listened to the smoke and mirrors game being played regarding the debt ceiling. Republicans are pretending to act like fiscal warriors…never mind the fact that size of our debt doubled in President Bush’s 8 years, and MANY Republicans voted to RAISE the debt ceiling during their reign in Congress. Their recent “heroic” acts certainly do not cut any ice with me, especially because spending has still been escalating since their 2010 takeover.
Let us now return to President Obama since the man has been telling the truth since 2006. It’s too bad that we do not have Senator Obama’s ideas from 2006. This particular Obama voted against raising the debt ceiling; and he had this to say about the fiscal status of our nation:
“The fact that we are here today to debate raising America’s debt limit is a sign of leadership failure. It is a sign that the U.S. Government can’t pay its own bills. It is a sign that we now depend on ongoing financial assistance from foreign countries to finance our Government’s reckless fiscal policies. Increasing America’s debt weakens us domestically and internationally. Leadership means that ‘the buck’ stops here. Instead, Washington is shifting the burden of bad choices today onto the backs of our children and grandchildren. America has a debt problem and a failure of leadership. Americans deserve better.”
This side of Obama is one who may have engaged in a libertarian acid trip…yet another reason to end the war on drugs! On a more serious note, let’s give him kudos for confessing the fact that the United States has been engaged in reckless monetary policy. Now, shall we examine his recent rhetoric?
Obama claims that if we do not raise the debt ceiling, the U.S. will not be able to pay the interest on its loans which would result in default. Our debt rating will be downgraded. Disaster will ensue! How many of you would like to raise your debt ceiling when you cannot pay your bills? Being fiscally responsible isn’t any fun! Why cut spending when you can just borrow more? So…what truth has Obama revealed? He is saying that the United States does not have the desire nor does it have to engage in fiscal responsibility since it owns a printing press. What the President should be doing is assuring our creditors that the United States will meet its obligations; however, if he doesn’t SCARE people and the markets into believing disaster will occur, then he cannot carry on the same reckless fiscal policies.
Obama must be convinced that the real disaster will not come during his watch. The day will come where our creditors will create a debt ceiling for us. After all, Obama’s recent confession shows just how close we are to being capped. He’s basically confessed that we cannot pay our bills without having to borrow more money. The printing press cannot print forever either for those of you who are naïve enough to think inflation has been averted.
When the going gets tough, the tough don’t have to get going in Washington. All they simply need to do is scare the daylights out of old people. It works like a charm every time, and it has political clout since our seniors comprise a major voting bloc. If President Obama is telling the truth that money will run out by August 3rd to issue social security checks, then he has admitted that there are no social security trust funds! Furthermore, this proves that social security is nothing more than a government-run Ponzi scheme. Bernie Madoff went to jail – he should have worked for the government.
As always, it’s up to the American people to change things. The U.S. government is in this predicament because so many people have become dependent on government programs. Politicians do not care about the future of the country. They care about staying in office; and they are not going to cut programs that their constituents depend upon unless people decide to cut the government umbilical cord themselves.
For a new nation, thing have changed awfully fast – especially over the past 100 years. We’ve allowed the monopoly. We have sold out. We now want government to make the decisions for us, even for the most critical things in life like medical care and retirement planning. We also protect the world by offering free security at the taxpayers’ expense. The endless foreign wars we have been engaged in both now and in the past have reached astronomical costs. We have successfully surrendered our freedoms, and as a result, we have an out-of-control tyrannical government that has weakened our status as a nation.
We have traded a free market for a sickening version of statism with regulatory policy to “protect us” being written by the very lobbyists who are publically despised. This has allowed several big corporations (our large banking institutions and General Electric among them) and major universities that corrupt our young adults to become nothing more than another extension of government.
History does not lie. Countries have been down this road before. The fiat currency system is failing. Ireland needs another bailout, and the Eurozone, as a whole, is becoming increasingly unstable. America cannot pay its bills without plunging further into debt.
Maybe it’s time for people to abandon the TV remote and pay more attention to the major loss of freedoms we as a nation have endured. I say this because there are still a vast amount of politically challenged people out there. For example, those who still believe there is a difference between Democrats and Republicans simply because they focus only on meaningless rhetoric.
How many people believe what President Obama is saying about the debt ceiling, when he had the opposite position four years ago? How many knew his position four years ago? How many seniors are scared to death that their social security will stop? The majority of the American population doesn’t know what constitutes the left and right wing since most will say the “evil right wing” is taking away their social security. In America, social authoritarians and war hawks are called right wing. Amazing! For a better understanding of the political spectrum, give this video seven minutes of your time:
The Political Spectrum Explained
On the brink of the 2012 election, the GOP’s top priority comes from a radical Christian group in Iowa asking candidates to sign a pledge which is not only horribly discriminatory, but it is the antithesis of the principles in which this country was founded. If that’s not bad enough, I am at a loss for words to explain how Mitt Romney, the father of universal healthcare, could be one of the top contenders. Also at the top is Michele Bachmann who seems to think homosexual couples are more dangerous than the power of the Federal Reserve.
Politicians could never get away with such lies and treachery if the ‘masses’ were a bit more educated; yet some people believe that libertarians like me are the ones who lack insight. Libertarians who stand for social and economic liberalism are the true champions and defenders of freedom.
Wednesday, March 9, 2011
Wisconsin’s Feud with Public Unions: A Dangerous War on Statism
Folks on the left don’t handle their cage being rattled very well. However, threats to the largest collusion in America – an alliance between government and labor unions are an act of war. The gloves come off, and things get very ugly.
Senator Sherrod Brown (D-Ohio) points out that Stalin, Mubarak and Hitler all opposed independent labor unions. His “mini-rant” basically imposes the idea that if one is opposed to collective bargaining rights, then they espouse the ideology of the aforementioned tyrannical leaders. After all, opposing people’s rights to collectively bargain is a major assault on freedom!
On the surface, if one opposes people’s right to collectively bargain and believes the government should impose such a restriction, then Senator Brown is not off the mark with his assertion. Granting the government this type of power would indeed be very anti-libertarian and anti-freedom. Unfortunately for Senator Brown, his assessment of the reality of the situation is far off the mark.
Leftists really should proceed with caution when they invoke historical elements into their arguments, as they almost always backfire. The ease of access to information allows people to debunk the rewriting of history much faster. Therefore, let us journey back in time to Adolph Hitler’s very own Mein Kampf. While it is true that Hitler abolished trade unions, we must first understand his ulterior motive before we run with an empty talking point. Hitler wasn’t anti-union. He was simply against any union that wasn’t the National Socialist Union. “A National Socialist union side by side with other unions is senseless. For it, too, must feel itself permeated by its philosophical task and the resultant obligation to be intolerant of other similar, let alone hostile, formations and to emphasize the exclusive necessity of its own ego. Here, too, there is no understanding and no compromise with related efforts, but only the maintenance of our absolute sole right.” The same is true for Stalin’s ‘Union’ of Soviet Socialist Republics! As long as said unions supported the state, they were just fine.
Before we return to the present time, let us visit the viewpoint of one more famous person in history – Franklin Delano Roosevelt – arguably the founding father of modern-day socialism in America. Surely, he can substantiate Senator Brown’s claim. Unfortunately, for the Senator, FDR’s position makes Brown’s ignorance gleam. President Roosevelt actually opposed public sector unions.
An excerpt from his letter to Luther C. Steward, President of the National Federation of Federal Employees, written on August 16, 1937 states:
"All Government employees should realize that the process of collective bargaining, as usually understood, cannot be transplanted into the public service. It has its distinct and insurmountable limitations when applied to public personnel management. The very nature and purposes of Government make it impossible for administrative officials to represent fully or to bind the employer in mutual discussions with Government employee organizations. The employer is the whole people, who speak by means of laws enacted by their representatives in Congress. Accordingly, administrative officials and employees alike are governed and guided, and in many instances restricted, by laws which establish policies, procedures, or rules in personnel matters.
Particularly, I want to emphasize my conviction that militant tactics have no place in the functions of any organization of Government employees. Upon employees in the Federal service rests the obligation to serve the whole people, whose interests and welfare require orderliness and continuity in the conduct of Government activities. This obligation is paramount. Since their own services have to do with the functioning of the Government, a strike of public employees manifests nothing less than an intent on their part to prevent or obstruct the operations of Government until their demands are satisfied. Such action, looking toward the paralysis of Government by those who have sworn to support it, is unthinkable and intolerable. It is, therefore, with a feeling of gratification that I have noted in the constitution of the National Federation of Federal Employees the provision that "under no circumstances shall this Federation engage in or support strikes against the United States Government." (The entire letter can be viewed here.)
The parallel is very obvious, so let’s tie it into the current situation. It has been established that ruthless dictators only support unions that support their cause – the state. FDR was certainly not anti-union; however he opposed any union that threatened the functionality of the government.
Things have changed quite a bit since the days of FDR. Unions have lost a vast amount of power in the private sector. Membership has steadily declined over the years and continues to slide down to a mere 11.9 percent. Conversely, union membership has a significant upward trend in the public sector as many state and local government jobs are unionized. In 2010, the union membership rate for public sector workers stood at 36.2 percent.(1)
Rather than public sector unions being at odds with government, as FDR feared, they joined forces instead. It is comical to read the rants of angry leftists blogging about anything from the Koch brothers’ influence to the accusations of war on the middle class. One would think with all of this concern about collusion and influence, we would discuss the biggest one of them all – the alliance between labor unions and members of Congress!
This is a website everyone should bookmark, as it tracks donations made to political candidates as well as Congressional lobbying. Interestingly enough, we find that SEVEN out of TEN of the organizations that have the deepest pockets are labor unions or organizations that act in the interest of labor unions. ActBlue is the number one seed with over $51 million in contributions. This organization is essentially the online clearing house for the Democratic Party as it has funneled over $134 million through mid-2010 to existing and potential candidates for the Democrat Party. The original page does not reflect donations below the $200,000 mark, which is why total contributions are substantially higher. Ironically, the non-union “heavy hitters” are organizations for realtors, lawyers and the firm Goldman Sachs – none of whom had anything to do with the latest market bubble that burst!
Ten of the top 15 all time donors contribute solidly to the Democratic Party. FDR need not turn in his grave, as the alliance to the state is stronger than ever. (2) What was that about Hitler and Stalin again?
Now that we have corrected the record on history, Sherrod Brown and demonstrated the glaring statism that exists between unions and the government; we can now articulate the differences between interfering with worker’s rights to organize, the difference between public and private sector unions as well as the role of collusion between labor unions and the government that effectively expands the voting bloc of the Democratic Party along with the welfare state.
No true believer in the ideology of a free market would ever impose a restriction on workers’ rights to organize and collectively bargain with organizations in the PRIVATE sector. A move that prohibits workers’ rights would be just as statist as the current collusion between “big labor” and government. The key is for workers and employers to have to ability to negotiate freely without influence from any political party. The problem with today’s labor unions is they are aligned with the Democratic Party, which is ANTI-freedom in the sense where workers’ union dues go primarily to fund the campaigns of politicians.
One may ask how there could be public support for Wisconsin Governor, Scott Brown if part of economic freedom is allowing workers the right to organize. The difference is simply the public sector versus the private sector. In the public sector, public sector employees are compensated via taxpayer dollars. If there is a budget shortfall in meeting workers’ compensation obligations, government has the power to raise taxes to meet these obligations – hence the redistribution of wealth. If unions negotiate with private sector businesses, and the company agrees to meet the union’s demand for higher pay; then the people have the FREEDOM to pass on a product that is too expensive due to the passed on cost of expensive labor. People don’t have the option to pass on paying their taxes. Higher taxes lead to private sector workers’ compensation and benefits being severely reduced. For instance, how many workers in the private sector enjoy a 100 percent employer contribution to their healthcare? In addition, “pension” seems to be a foreign word in the private sector. It is safe to say that workers in the private sector contribute a minimum of 15 percent of their salaries towards their healthcare and retirement.
The argument has been made by some on the left that public sector workers are not rich, and their wages are not substantially higher than workers in the private sector. This is incredibly disingenuous in the sense that wages are only PART of a worker’s total compensation. The issue is not wages is much as it is BENEFITS. Illinois just invoked one of the largest tax hikes in history in order to meet state worker’s pension obligations. Workers in the private sector saw their pensions shrink, and younger workers were not even eligible; yet, no one threatened to burn down the state capitol. Governor Chris Christie of New Jersey recently asked state workers to contribute a measly one and a half percent to their OWN retirement plan to avert a tax increase, and he receives death threats.
There is no reason why public sector workers cannot be fairly compensated for the work they perform. However, this cannot come at the expense of others, nor can it be a motive to expand the voting bloc of the Democratic Party or be in the form of welfare. It is indeed welfare for workers to receive wages and/or benefits that are higher than what the free market is willing to pay. People then become trapped in the job and married to the union, as they cannot find alternate positions that will compensate them in the same manner. Therefore, there is no incentive for people to better their skills. Is this really the precedent we wish to set for our police officers, firefighters and teachers? Those jobs are sort of important, which also nullifies the notion that these workers would work for pennies on the dollar if labor unions did not exist. How are these positions any different than other skilled positions? The truth is employers would like a worker to work for free. People are compensated because their skills add value to the organization which makes it necessary for an organization to properly compensate said worker. The worker then has the power to take their skills to the highest bidder.
America is at a crossroads, and the cleaning of its fiscal house will not begin at the top…surprise, surprise! Rather it will begin at the state and local level. It is my hope that Governors like Scott Walker of Wisconsin, Chris Christie of New Jersey and John Kasich of Ohio remain strong in a war more difficult than any overseas. It’s not easy to unravel the most powerful political machine in America, as their pockets are deep; and they have the power of the media to fill the airwaves up with nonsensical propaganda.
We’ll need more governors to fight the good fight because someone needs to find the political courage to tell public sector workers the very harsh truth that has been hidden for decades.
(1) http://www.bls.gov/news.release/union2.nr0.htm
(2) http://www.opensecrets.org/orgs/list.php?type=A
Senator Sherrod Brown (D-Ohio) points out that Stalin, Mubarak and Hitler all opposed independent labor unions. His “mini-rant” basically imposes the idea that if one is opposed to collective bargaining rights, then they espouse the ideology of the aforementioned tyrannical leaders. After all, opposing people’s rights to collectively bargain is a major assault on freedom!
On the surface, if one opposes people’s right to collectively bargain and believes the government should impose such a restriction, then Senator Brown is not off the mark with his assertion. Granting the government this type of power would indeed be very anti-libertarian and anti-freedom. Unfortunately for Senator Brown, his assessment of the reality of the situation is far off the mark.
Leftists really should proceed with caution when they invoke historical elements into their arguments, as they almost always backfire. The ease of access to information allows people to debunk the rewriting of history much faster. Therefore, let us journey back in time to Adolph Hitler’s very own Mein Kampf. While it is true that Hitler abolished trade unions, we must first understand his ulterior motive before we run with an empty talking point. Hitler wasn’t anti-union. He was simply against any union that wasn’t the National Socialist Union. “A National Socialist union side by side with other unions is senseless. For it, too, must feel itself permeated by its philosophical task and the resultant obligation to be intolerant of other similar, let alone hostile, formations and to emphasize the exclusive necessity of its own ego. Here, too, there is no understanding and no compromise with related efforts, but only the maintenance of our absolute sole right.” The same is true for Stalin’s ‘Union’ of Soviet Socialist Republics! As long as said unions supported the state, they were just fine.
Before we return to the present time, let us visit the viewpoint of one more famous person in history – Franklin Delano Roosevelt – arguably the founding father of modern-day socialism in America. Surely, he can substantiate Senator Brown’s claim. Unfortunately, for the Senator, FDR’s position makes Brown’s ignorance gleam. President Roosevelt actually opposed public sector unions.
An excerpt from his letter to Luther C. Steward, President of the National Federation of Federal Employees, written on August 16, 1937 states:
"All Government employees should realize that the process of collective bargaining, as usually understood, cannot be transplanted into the public service. It has its distinct and insurmountable limitations when applied to public personnel management. The very nature and purposes of Government make it impossible for administrative officials to represent fully or to bind the employer in mutual discussions with Government employee organizations. The employer is the whole people, who speak by means of laws enacted by their representatives in Congress. Accordingly, administrative officials and employees alike are governed and guided, and in many instances restricted, by laws which establish policies, procedures, or rules in personnel matters.
Particularly, I want to emphasize my conviction that militant tactics have no place in the functions of any organization of Government employees. Upon employees in the Federal service rests the obligation to serve the whole people, whose interests and welfare require orderliness and continuity in the conduct of Government activities. This obligation is paramount. Since their own services have to do with the functioning of the Government, a strike of public employees manifests nothing less than an intent on their part to prevent or obstruct the operations of Government until their demands are satisfied. Such action, looking toward the paralysis of Government by those who have sworn to support it, is unthinkable and intolerable. It is, therefore, with a feeling of gratification that I have noted in the constitution of the National Federation of Federal Employees the provision that "under no circumstances shall this Federation engage in or support strikes against the United States Government." (The entire letter can be viewed here.)
The parallel is very obvious, so let’s tie it into the current situation. It has been established that ruthless dictators only support unions that support their cause – the state. FDR was certainly not anti-union; however he opposed any union that threatened the functionality of the government.
Things have changed quite a bit since the days of FDR. Unions have lost a vast amount of power in the private sector. Membership has steadily declined over the years and continues to slide down to a mere 11.9 percent. Conversely, union membership has a significant upward trend in the public sector as many state and local government jobs are unionized. In 2010, the union membership rate for public sector workers stood at 36.2 percent.(1)
Rather than public sector unions being at odds with government, as FDR feared, they joined forces instead. It is comical to read the rants of angry leftists blogging about anything from the Koch brothers’ influence to the accusations of war on the middle class. One would think with all of this concern about collusion and influence, we would discuss the biggest one of them all – the alliance between labor unions and members of Congress!
This is a website everyone should bookmark, as it tracks donations made to political candidates as well as Congressional lobbying. Interestingly enough, we find that SEVEN out of TEN of the organizations that have the deepest pockets are labor unions or organizations that act in the interest of labor unions. ActBlue is the number one seed with over $51 million in contributions. This organization is essentially the online clearing house for the Democratic Party as it has funneled over $134 million through mid-2010 to existing and potential candidates for the Democrat Party. The original page does not reflect donations below the $200,000 mark, which is why total contributions are substantially higher. Ironically, the non-union “heavy hitters” are organizations for realtors, lawyers and the firm Goldman Sachs – none of whom had anything to do with the latest market bubble that burst!
Ten of the top 15 all time donors contribute solidly to the Democratic Party. FDR need not turn in his grave, as the alliance to the state is stronger than ever. (2) What was that about Hitler and Stalin again?
Now that we have corrected the record on history, Sherrod Brown and demonstrated the glaring statism that exists between unions and the government; we can now articulate the differences between interfering with worker’s rights to organize, the difference between public and private sector unions as well as the role of collusion between labor unions and the government that effectively expands the voting bloc of the Democratic Party along with the welfare state.
No true believer in the ideology of a free market would ever impose a restriction on workers’ rights to organize and collectively bargain with organizations in the PRIVATE sector. A move that prohibits workers’ rights would be just as statist as the current collusion between “big labor” and government. The key is for workers and employers to have to ability to negotiate freely without influence from any political party. The problem with today’s labor unions is they are aligned with the Democratic Party, which is ANTI-freedom in the sense where workers’ union dues go primarily to fund the campaigns of politicians.
One may ask how there could be public support for Wisconsin Governor, Scott Brown if part of economic freedom is allowing workers the right to organize. The difference is simply the public sector versus the private sector. In the public sector, public sector employees are compensated via taxpayer dollars. If there is a budget shortfall in meeting workers’ compensation obligations, government has the power to raise taxes to meet these obligations – hence the redistribution of wealth. If unions negotiate with private sector businesses, and the company agrees to meet the union’s demand for higher pay; then the people have the FREEDOM to pass on a product that is too expensive due to the passed on cost of expensive labor. People don’t have the option to pass on paying their taxes. Higher taxes lead to private sector workers’ compensation and benefits being severely reduced. For instance, how many workers in the private sector enjoy a 100 percent employer contribution to their healthcare? In addition, “pension” seems to be a foreign word in the private sector. It is safe to say that workers in the private sector contribute a minimum of 15 percent of their salaries towards their healthcare and retirement.
The argument has been made by some on the left that public sector workers are not rich, and their wages are not substantially higher than workers in the private sector. This is incredibly disingenuous in the sense that wages are only PART of a worker’s total compensation. The issue is not wages is much as it is BENEFITS. Illinois just invoked one of the largest tax hikes in history in order to meet state worker’s pension obligations. Workers in the private sector saw their pensions shrink, and younger workers were not even eligible; yet, no one threatened to burn down the state capitol. Governor Chris Christie of New Jersey recently asked state workers to contribute a measly one and a half percent to their OWN retirement plan to avert a tax increase, and he receives death threats.
There is no reason why public sector workers cannot be fairly compensated for the work they perform. However, this cannot come at the expense of others, nor can it be a motive to expand the voting bloc of the Democratic Party or be in the form of welfare. It is indeed welfare for workers to receive wages and/or benefits that are higher than what the free market is willing to pay. People then become trapped in the job and married to the union, as they cannot find alternate positions that will compensate them in the same manner. Therefore, there is no incentive for people to better their skills. Is this really the precedent we wish to set for our police officers, firefighters and teachers? Those jobs are sort of important, which also nullifies the notion that these workers would work for pennies on the dollar if labor unions did not exist. How are these positions any different than other skilled positions? The truth is employers would like a worker to work for free. People are compensated because their skills add value to the organization which makes it necessary for an organization to properly compensate said worker. The worker then has the power to take their skills to the highest bidder.
America is at a crossroads, and the cleaning of its fiscal house will not begin at the top…surprise, surprise! Rather it will begin at the state and local level. It is my hope that Governors like Scott Walker of Wisconsin, Chris Christie of New Jersey and John Kasich of Ohio remain strong in a war more difficult than any overseas. It’s not easy to unravel the most powerful political machine in America, as their pockets are deep; and they have the power of the media to fill the airwaves up with nonsensical propaganda.
We’ll need more governors to fight the good fight because someone needs to find the political courage to tell public sector workers the very harsh truth that has been hidden for decades.
(1) http://www.bls.gov/news.release/union2.nr0.htm
(2) http://www.opensecrets.org/orgs/list.php?type=A
Tuesday, January 18, 2011
FEDERAL RESERVE BANK TO FLOOD US MARKET WITH WII POINTS
By Mike Porter
*** SATIRE ***
In a shocking press release today, the Federal Reserve Bank of America has announced plans to increase Nintendo Wii points to all domestic Wii game consoles by the third quarter of 2011. The plan involves selling a small fraction of the US treasury bonds currently being held by the Fed. The bonds will be redeemed for US dollars which they will convert to Wii points and distribute to all game consoles across the country. Owners of Wii consoles will expect to see additional Wii credits throughout the first and second quarter of 2011 with every game console in America being credited by third quarter. The entire initiative is expected to cost just over $300 million. With just over 30 million Wii consoles in homes today, the current plan will increase all US based consoles by 1,000 points or $10 per game console in the US. Wii points can be used to purchase new games online, rent movies through online movie services, or purchase additional game add-ons.
The Fed expects this will have a dramatic economic impact almost immediately. In a statement by the Fed Chairman Bernanke today, “Desperate times call for desperate measures. Today we find ourselves in a situation where most domestic Wii systems, have little or no Wii points available to them. That means game systems across America are no longer solvent and we need to act quickly to pump our game systems with liquidity so the consumer can begin online purchasing once again.” When asked if selling the treasury bonds will increase interest rates the Fed responded by saying, “The amount of bonds that will be sold for this initiative is insignificant compared to what is currently being held today by the Fed. We expect little or no change in the interest rate as a result of the sale of these assets. The chairman went on to say, “With roughly one Nintendo Wii system for every 10 households in America, we can no longer ignore the economic impact of game systems and their influence in the US or the world. The Fed has the means and the capability to monitor and maintain point balances on game systems if economic indicators require intervention. This will be used as another arrow in the quiver of the Fed to stimulate and slow the economy if need be. From today forward this will be known as quantitative Wii-sing.”
The reaction to the news has been described as ecstatic. Young Billy, a ten year old student, was asked what he thought of the news. He responded by saying, “Wow! That means I get to download some new games that my parents won’t buy me. Thanks Bernanke!” One unemployed gentlemen, who asked to remain anonymous, was thrilled and had this to say about the announcement, “That’s cool news! Since I can’t find a job at least I can get caught up on all my gaming needs. It’s nice to know I can help the economy recover right from my living room couch and my 1,000 Wii credits will be well spent. We need more programs like this if we expect to recover any time soon.”
Nintendo shares jumped almost 3 percent upon release of the news and all major indices are up following the announcement.
Sources:
http://wii.nintendolife.com/news/2010/08/wii_passes_30_million_units_sold_in_the_us
*** SATIRE ***
In a shocking press release today, the Federal Reserve Bank of America has announced plans to increase Nintendo Wii points to all domestic Wii game consoles by the third quarter of 2011. The plan involves selling a small fraction of the US treasury bonds currently being held by the Fed. The bonds will be redeemed for US dollars which they will convert to Wii points and distribute to all game consoles across the country. Owners of Wii consoles will expect to see additional Wii credits throughout the first and second quarter of 2011 with every game console in America being credited by third quarter. The entire initiative is expected to cost just over $300 million. With just over 30 million Wii consoles in homes today, the current plan will increase all US based consoles by 1,000 points or $10 per game console in the US. Wii points can be used to purchase new games online, rent movies through online movie services, or purchase additional game add-ons.
The Fed expects this will have a dramatic economic impact almost immediately. In a statement by the Fed Chairman Bernanke today, “Desperate times call for desperate measures. Today we find ourselves in a situation where most domestic Wii systems, have little or no Wii points available to them. That means game systems across America are no longer solvent and we need to act quickly to pump our game systems with liquidity so the consumer can begin online purchasing once again.” When asked if selling the treasury bonds will increase interest rates the Fed responded by saying, “The amount of bonds that will be sold for this initiative is insignificant compared to what is currently being held today by the Fed. We expect little or no change in the interest rate as a result of the sale of these assets. The chairman went on to say, “With roughly one Nintendo Wii system for every 10 households in America, we can no longer ignore the economic impact of game systems and their influence in the US or the world. The Fed has the means and the capability to monitor and maintain point balances on game systems if economic indicators require intervention. This will be used as another arrow in the quiver of the Fed to stimulate and slow the economy if need be. From today forward this will be known as quantitative Wii-sing.”
The reaction to the news has been described as ecstatic. Young Billy, a ten year old student, was asked what he thought of the news. He responded by saying, “Wow! That means I get to download some new games that my parents won’t buy me. Thanks Bernanke!” One unemployed gentlemen, who asked to remain anonymous, was thrilled and had this to say about the announcement, “That’s cool news! Since I can’t find a job at least I can get caught up on all my gaming needs. It’s nice to know I can help the economy recover right from my living room couch and my 1,000 Wii credits will be well spent. We need more programs like this if we expect to recover any time soon.”
Nintendo shares jumped almost 3 percent upon release of the news and all major indices are up following the announcement.
Sources:
http://wii.nintendolife.com/news/2010/08/wii_passes_30_million_units_sold_in_the_us
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