A Simple Explanation
April 16th 2009 06:08
Barack Obama = Homeowner that can afford a 3 Trillion dollar house
Barack's Budget = A 3.6 Trillion dollar house
Congress = An irresponsible bank that thinks its underwriters will buy their debt forever
China = Congress's number one underwriter
The Fed = Printing money in the basement
Barack went to the Congress with undocumented and hopeful future income. Even given that he was only able to afford a $3 Trillion house, but wanted to buy a $3.6 Trillion house.
Congress said "Sure, we'll loan you that, and we'll have China pay the extra so America won't default on the debt."
Congress signed off on Barack's house (his budget, for those that might be missing the analogy).
This year Barack and America will fall $2 Trillion dollars short of paying for that house, because they underwent over a trillion dollars worth of elective and unnecessary surgery (the stimulus, the economy has shown signs of life before it really had a chance to get out there).
Behind on his payments on behalf of America, Congress turns to the underwriters.
The underwriters (China) say "No, way, Mr. President, your Fed has been printing money like it grows on trees the last six months and your dollar is in free fall. We're putting our money in Russian Oil"
America is broke, like all those subprime mortgage holders that created our economic situation to begin with. What happens in a bankrupt country?
This isn't ideology, conservative or liberal. It's math. In 2008, without TARP and the bailouts and the stimulus checks, we would have had a surplus in the budget. We ended up $400 Billion overdrawn. You can't follow that up with 5 times more debt the next year and an average of a trillion a year for the next ten, and not go broke.
It's just math. If you lose income and spend a massive amount of cash for a new boat in the driveway, you can't then turn around and borrow more for a new RV and motorcycles. The same goes for the government.
To pay this back if the ten year plan the President has laid out survives ten years would be impossible. The crushing taxes just to keep government at status quo, plus the entitlement spending coming due in the next five years as more and more baby boomers retire, will drive mobile citizens (the rich by Barack's definitions) and business overseas, tanking the economy and further reducing the tax base, exacerbating the problem. Welfare, Social Security, Medicaid and SCHIP will all be broke, yet continue to be used as an election club to keep people who want to fix the system out of office by painting them as heartless.
Hopefully, in 2010 conservatives, not just Republicans, can take back control of the House. The senate doesn't have enough Democratic seats up to take it back, but we can increase the filibuster numbers to block things. Then we can cut the budgets and return to sanity. They will be hard cuts, but it is not possible for a country to keep spending and borrowing money like it is limitless.
It's math, not ideology.
You can support my blogging even more by buying my book at Author House. Unlike liberals, this is the only fantasy world I live in
Barack's Budget = A 3.6 Trillion dollar house
Congress = An irresponsible bank that thinks its underwriters will buy their debt forever
China = Congress's number one underwriter
The Fed = Printing money in the basement
Barack went to the Congress with undocumented and hopeful future income. Even given that he was only able to afford a $3 Trillion house, but wanted to buy a $3.6 Trillion house.
Congress said "Sure, we'll loan you that, and we'll have China pay the extra so America won't default on the debt."
Congress signed off on Barack's house (his budget, for those that might be missing the analogy).
This year Barack and America will fall $2 Trillion dollars short of paying for that house, because they underwent over a trillion dollars worth of elective and unnecessary surgery (the stimulus, the economy has shown signs of life before it really had a chance to get out there).
Behind on his payments on behalf of America, Congress turns to the underwriters.
The underwriters (China) say "No, way, Mr. President, your Fed has been printing money like it grows on trees the last six months and your dollar is in free fall. We're putting our money in Russian Oil"
America is broke, like all those subprime mortgage holders that created our economic situation to begin with. What happens in a bankrupt country?
This isn't ideology, conservative or liberal. It's math. In 2008, without TARP and the bailouts and the stimulus checks, we would have had a surplus in the budget. We ended up $400 Billion overdrawn. You can't follow that up with 5 times more debt the next year and an average of a trillion a year for the next ten, and not go broke.
It's just math. If you lose income and spend a massive amount of cash for a new boat in the driveway, you can't then turn around and borrow more for a new RV and motorcycles. The same goes for the government.
To pay this back if the ten year plan the President has laid out survives ten years would be impossible. The crushing taxes just to keep government at status quo, plus the entitlement spending coming due in the next five years as more and more baby boomers retire, will drive mobile citizens (the rich by Barack's definitions) and business overseas, tanking the economy and further reducing the tax base, exacerbating the problem. Welfare, Social Security, Medicaid and SCHIP will all be broke, yet continue to be used as an election club to keep people who want to fix the system out of office by painting them as heartless.
Hopefully, in 2010 conservatives, not just Republicans, can take back control of the House. The senate doesn't have enough Democratic seats up to take it back, but we can increase the filibuster numbers to block things. Then we can cut the budgets and return to sanity. They will be hard cuts, but it is not possible for a country to keep spending and borrowing money like it is limitless.
It's math, not ideology.
You can support my blogging even more by buying my book at Author House. Unlike liberals, this is the only fantasy world I live in
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Comment by S.L.
The Political Brief
Comment by Andrew Biviano
The Middle Ground
But every line in the budget has a constituency, and every one of them wants the others to make the sacrifice. Balancing the national checkbook is going to take major sacrifices from everyone. Where is your sacrifice?
Are you wiling as a voter to approve of Congress getting rid of spending you support, in order to make the math work out? In what specific areas? Perhaps our defense spending, the largest in the world many times over, bigger than most countries' GDP? Maybe save money being spent on border walls, incarcerating non-violent drug offenders, regulating wall street and protecting the vulnerable? Perhaps you would be willing to increase your taxes to pay for unplanned costly foregn wars, which you say you support? Somehow, I doubt it.
Comment by Jonathan Biviano
Politics Realm
Marriage Bits
- Defense
- Justice
For now though, in the real world, I want:
- The 31% Medicaid fraud seriously attacked.
- Their spending to be within what they can collect at a lower tax rate
- To stop throwing money at education, since we already spend more per student than any other nation and have sub-par results.
- Cut out waste in defense spending, like $17,000 hammers.
- To get lean and mean in all the government agencies.
- To make more voters pay taxes, or have to pay taxes to vote. It's not right to be able to vote for people that do the spending, if you're not contributing to paying for that spending.
It is about increasing the budget by 10% from last year with revenue dropping because of the recession and a trillion already spent extra-budgetary. Come on. Give up health care this year. Give up increasing SCHIP this year. Our churches, families and neighbors will keep taking care of people while those things wait.
But the tea parties were also about the Department of Homeland Security report that really does label even me a potential terrorist. That's right, it uses terrorist in the report on 'right wing extremism' to describe people who are opposed to abortion or immigration (it doesn't even specify illegal immigration) but terrorist attacks in the US are now going to be called, by Obama's own instructions, "Man Caused Disasters," and the war on terror is now "An Overseas Contigency Operation."
It's all so Orwellian, redefining events and people with words that don't apply.
Comment by Jonathan Biviano
Politics Realm
Marriage Bits
President Lincoln said, "It's not right to tear down one man's house to build one for another." When half of Americans don't pay taxes and a good portion of those get checks back from the IRS as well, while the other half works, innovates and creates to send that money to them, it's not right. When those who pay taxes can be outvoted by those who don't, but the spending is slanted to most benefit those who don't pay taxes (entitlement, government health care, etc), democracy has died.
Comment by Andrew Biviano
The Middle Ground
Of course, everyone wants to fight waste, fraud and abuse. But guess who does that? A government agency. This will require tax dollars. It also requires tax dollars to build roads and do a lot of other things that most of us appreciate.
And you know better, or at least should know better, than to say that some people pay no taxes. Everyone pays taxes. Do you really think that the FICA tax is the only one we have in this country? I have seen you complain about all the other hidden taxes! You have often talked about how all government taxes, on things like energy and corporations, just get passed on to the consumer. So, by your own reasoning, anyone who has paid an energy bill or bought anything has thus paid taxes. Everyone has also paid sales tax in most states. Everyone (except for the homeless) pays either their own property tax or their landlord's property tax via rent payments. Everyone who works pays at least the payroll tax. There are many more taxes and fees that we all pay on a regular basis (getting a license, buying gas, flying, staying in a hotel, etc.). So, your suggestion that we disenfranchise the poor is not only disgusting but also completely wrong.
Comment by Jonathan Biviano
Politics Realm
Marriage Bits
Everything else should be local. Local and state officials are much more reponsive to the needs of their constituents because they are right there.
I'd be thrilled to pay 10% to the feds instead of 25% and 25% to the state instead of 10% to pay for programs the voters in my state approved. I'd be even happier with 10% to fed, 10% to state and 15% to my city or county, which is how I believe it should be if we're going to pay 35% of our income to taxes.
Charter schools that get out from under Federal rules produce better students because their rules are enforced by the surrounding community that sends their kids there, not by by DC bureaucrats. My kids went to one and all the kids there far outpaced the other schools in the area.
The national government is too big, can't be specific enough to an area's desires, can't take into account the various cultures, etc. Let counties collect more taxes and fund health clinics. In places with stronger churches and charity organizations, they may not have to do this, so the taxes wouldn't be as high. If the majority of the people in a city want to fund abortions with their taxes, let them do it. The vast majority of Americans are opposed to having tax dollars used for abortions, even many pro-choice people, so they wouldn't have to if their tax spending was decided locally. But people in San Francisco and Seattle could do it and have the funds to do it. Instead, the federal government will use financial coercion to get things funded and make the states conform. For instance, Jindal is rejecting part of the stimulus because it funds unemployment law changes for one year, but then forces him to raise taxes or change the laws again after that.
So yeah, I'm a federalist, which according to Janet Napolitano makes me a threat to the US.
The only job of the federal government should be to provide for the defense of our life, liberty and pursuit of happiness from internal and external enemies, and that the rights granted by the constitution to every citizen are not being violated by any other person or agency.
The founding fathers knew this, and that's why the constitution had to be amended to even have a national income tax to begin with. The most powerful agency that can and is often used for oppression is the IRS. I've never been audited, but did you know that Sean Hannity, Rush Limbaugh and almost every other conservative talk show host gets audited EVERY YEAR if a Democrat is in office?
The federal government should not be picking winners and losers. Period.
As far as all those other taxes, many of those are there to hold people accountable to their decisions, such as car registrations and licensing fees. And with a huge unfunded liability in SS coming down the road, should we really be refunding people's FICA, especially to those who will really need it when they retire? It would be better to tell everybody with over $100,000/yr in other retirement income that they are not eligible for SS, and treat it like a welfare program for the old.
Comment by Andrew Biviano
The Middle Ground
This was at one time a valid argument, but it was lost once and for all in the 1790's when Hamilton and other drafters of the Constitution wrote the Federalist Papers and established the accepted interpretation of the necessary and proper clause and the doctrine of implied powers. There is no way that any Supreme Court is going to reverse precedent that goes back to our nation's founding. You're stuck with this system, so I suggest working with it.
I have no problem with more taxes going to local government if local government would handle the thngs I think it should. But we also need to guard against local funding making the class divide even larger. Have you ever seen how local funding creates two different caste-based school systems? Two schools 5 miles apart; one gets double the dollars per student. If we really believe this is the land of opportunity and want to quiet those who call for affirmative action, we need to at least ensure that everyone has equal access to the basics like education and health care. If that were actualy accomplished, no one would see a need for handouts or preferences. Most would say "may the best man win."
As to the rest of your comments on taxes, please read my new blog. (You got me hooked). The link is above.