As I wrote here on my companion business blog late last month, a lot of the flap about Friday's after-hours credit downgrade of the US government by S&P from AAA to AA+ is actually a non-event.
Media coverage would have you believe otherwise. But let's consider several aspects of the downgrade.
Wonderboy's people are calling it a politically-motivated mistake by S&P. They mention and arithmetic error in a pre-release draft in the amount of several trillion dollars. That's nonsense. The US has been increasing its deficits for decades, but never so quickly as in the past 2 1/2 years.
As Kaminsky, and others, have attested, the true risk of US debt has already been 'baked into' rates. In that sense, this is a non-event.
Of course, the Democratic retort is to blame the messenger. Ceaselessly citing the bogus ratings by S&P, and other agencies, of mortgage-backed bonds, Barney Frank, Wonderboy, Treasury and every other Democrat in Washington with an ego has now decided that ratings agencies are not to be trusted in the first place.
Actually, as Doug Dachille has pointed out in the past on CNBC, at least for municipal, state and many other ratings, that's true. It's just that now is an awfully suspect time for the federal government to declare it.
However, in terms of the black eye suffered by Wonderboy's administration by allowing itself to be put in the position of being unable to fulfill S&P's quite public $4T spending cut requirements, it's a real event. It provides the ammunition that the GOP needs to fend off further spending. The continuing sluggish US economy provides the bookend of not justifying large-scale, significant tax increases.
So, as I wrote in that linked post,
"Well, American voters need only look in the mirror for whom to blame. They consciously elected and re-elected generally inept spendthrifts since 1932, then wonder why the country has amassed so much net external debt.
It's time for Americans to wake up to the consequences of their poor political choices for the last eight decades.
And when the rating downgrade happens, the resulting increased funding costs will help put a stop to excessive spending and bad tax policies, only from outside, uncontrollable forces, rather than internal, political ones."
For all we know, on a relative basis, global demand may now be lower, at every rate, for US Treasuries. The new constraint on boundless US debt growth is, if it exists, now uncontrollable and external.
To me, that's a good thing. Eight decades of inept fiscal policy in Washington has led us to this point. I'm quite content with markets spanking the federal government and putting limits on what the federal officials whom US voters have mistakenly allowed to spend us into the poorhouse can now spend and borrow.
Showing posts with label Debt Ceiling. Show all posts
Showing posts with label Debt Ceiling. Show all posts
Monday, August 8, 2011
Friday, August 5, 2011
The Debt Limit Deal- Government American Style
I wrote in this recent post,
"Actually, they do. And we know for a fact that voters in at least 87 House districts, the ones which elected freshmen GOP members, and a handful of states which elected Senators like Marco Rubio, Rand Paul, and other Tea Party-inclined GOP freshmen Senators, don't care about bi-partisanship which allows the free-spending liberal Democrats to continue their usual Washington ways.
What I believe we are seeing is not a new emphasis on bi-partisanship, but a fleeting moment of collaboration to do the minimum necessary to operate the federal government, until the 2012 elections sweep Democrats from their control of the Senate and, probably, the Oval Office.
But I agree with Charles Krauthammer, who contended recently on Fox News that Americans need a serious, knock-down, drag-out debate about the nation's direction at least once every generation.
That's what is occurring now. The recent debt limit debates and so-called (faux) crisis is merely the opening shot in that battle.
If you can objectively observe the trends of the past four years, it's pretty clear that the election of an inexperienced, spendthrift Senator from Illinois to the presidency, along with majorities in both houses of Congress, was the breaking point.
Now momentum has moved back the other way."
David Rivkin, Jr., and Lee Casey, attorneys who served in the Department of Justice during the Ronald Reagan and George H.W. Bush administrations, wrote an editorial in Tuesday's edition of the Wall Street Journal entitled A Debt Deal The Founders Could Love. In it, they expanded on a similar point, eschewing this sudden love of bi-partisan compromise by Democrats,
"The debt-ceiling crisis has prompted predictable media laments about how partisan and dysfunctional our political system has become. But if the process leading to the current deal was a "spectacle" and a "three-ring circus," as Obama adviser David Plouffe put it, the show's impresarios are none other than James Madison and Alexander Hamilton. Our messy political system is working exactly the way our Founders intended it to.
To the extent House members were the most intransigent during the process—a matter of opinion, in any case—they were meant to be. The House of Representatives is the "popular branch," as described in The Federalist Papers, and was intended to "have an immediate dependence on, and an intimate sympathy with, the people." Many people, especially those who elected tea party candidates last November, passionately believe that the federal government has gone off the rails. They think that Washington has been spending like a drunken sailor since President Obama took office, and that this profligacy must end.
By contrast, the Framers conceived the Senate as a body of graybeards (or, at the very least, as modestly mature individuals who have reached the age of 30). It was meant to represent the interests of the states and to serve as a check on "the impulse of sudden and violent passions," or the danger of "factious leaders" offering "intemperate and pernicious resolutions" that might in time characterize the lower house. If the Senate has been less willing than the House to call an immediate halt to federal borrowing and to seek a more gradual return to fiscal responsibility, this too is exactly what it is supposed to do.
The result was a compromise, as it has nearly always been throughout our history. This will be a disappointment to many who voted for real and immediate fiscal restraint, but that too is to be expected. The Framers believed in gradual change. They prized stability and predictability. Most would have agreed with Talleyrand's injunction—"above all, not too much zeal"—and themselves watched as Talleyrand learned this lesson the hard way. An early and enthusiastic participant in the French Revolution, France's future foreign minister was forced to take refuge in the United States after his countrymen started cutting off heads.
Accordingly, the Framers rejected a parliamentary system of government, where power is concentrated in the legislature and very often in one house of the legislature. There truly are winners and losers in such political systems, and governmental policy can indeed be transformed immediately after a new government takes office.
By contrast, our Constitution diffuses power both vertically among the federal government and states and horizontally among the three branches of the federal government—and then again within Congress itself. Change, even good and necessary change, is always difficult. It must be based on consensus.
Yes, reaching consensus on any issue that matters is messy. Shouting and intransigence are commonplace in such battles and have been since the very beginning. Indeed, the Washington circus began well before the capital city was completed, and the Founding generation was second to none in its use of political invective. For example, Thomas Jefferson and his surrogates suggested President Washington had gone senile and claimed that John Adams was a closet monarchist. After he became president, Jefferson himself was excoriated because of an alleged sexual relationship with one of his slaves, Sally Hemmings.
Rarely in our system do the participants, whether in the House, Senate or White House, achieve all or even most of their goals in a single political battle. Sunday night, a debt-ceiling deal was reached that will raise the federal debt ceiling and permit continued borrowing to fund federal government operations through 2012 rather than just for another six months. The hard questions—taxes and spending cuts—have largely been postponed.
But the key point has been made. Few now suggest that we can continue on our current spending binge. That is the beginning of a consensus, and a good start towards genuine change. Postponing the difficult questions also means that the electorate can have its say in the 2012 elections, and represents significant political risks for all parties.
The Framers would be pleased at the "spectacle." "
Rivkin and Casey have done a wonderful job, in my opinion, of debunking, with historical examples, this commonly-, but wrongly-held notion that there was more political civility in our Republic's olden times. One often hears these appeals for bi-partisanship, compromise and civility when a party or leader knows they possess a very weak position, either in terms of votes or ideology.
In this most recent case, the debt limit battle, the Democrats were weak on both counts. Thus, the appeal for compromise in order to attempt to hide their weakness on spending and rather naked desire to simply be given the license to embark on a few trillion dollars more in American indebtedness.
While it's true that the ultimate amount of spending cuts were minuscule, and the debt ceiling was raised by an amount ($2.4T) calculated by Wonderboy to allow him to get through the next election before seeking to raise it again, the tide has turned, and Tea Party-inspired legislators who voted for the anemic bill made their point.
And it's not finished. Michele Bachmann voted no and, I am sure, will use that vote to bludgeon any fellow candidates for the GOP presidential nomination, should they voice support of the bill, as passed.
It would have done no good for the US to have gone through the trouble of allocating incoming tax receipts to pay debt interest and some necessary expenses, while shutting down parts of the federal government. But the near-run partial shutdown proved a point.
It substantially eroded Wonderboy's remaining low levels of power and standing with voters. I suspect, given the excessive rhetoric of Democratic Senators and the VP, calling Tea Party-backed legislators "terrorists" won't have endeared that party to voters, come 2012. Not to mention Harry Reid's continuing insistence that he wants to raise taxes so he can hand Wonderboy more money to waste.
Even if the GOP can't field a candidate who defeats Wonderboy next year, the Senate is likely to shift to GOP control, making the First Rookie's second term, if there is one, essentially pointless.
But, as Rivkin and Casey imply, America gets the government it wants and deserves. It tried Democratic hegemony for two years, and found it unacceptable. As I wrote in the earlier post, were the entire Senate up for re-election last November, chances are the Republicans would control that chamber now, too.
Come 2012, though, sufficient numbers of independents could be so wary of continued Democratic control of any federal branch of government that even a weak GOP presidential candidate will be washed into office along with majorities in both houses of Congress. To begin the work of cutting back federal government size, reach and spending.
Yes, it sure is messy when government change occurs 33 Senate seats, 435 House seats at a time, every two years, and the Oval Office only once each four years. It makes for halting, erratic government during the big power shifts.
But I sense a trifecta coming for the GOP in 2012 now that the Democrats showed their true colors during the debt ceiling battle, i.e., raise taxes, borrow more, spend more.
I believe most voting Americans no longer want that type of federal government. And when they get what they want next year, it won't look so messy anymore.
"Actually, they do. And we know for a fact that voters in at least 87 House districts, the ones which elected freshmen GOP members, and a handful of states which elected Senators like Marco Rubio, Rand Paul, and other Tea Party-inclined GOP freshmen Senators, don't care about bi-partisanship which allows the free-spending liberal Democrats to continue their usual Washington ways.
What I believe we are seeing is not a new emphasis on bi-partisanship, but a fleeting moment of collaboration to do the minimum necessary to operate the federal government, until the 2012 elections sweep Democrats from their control of the Senate and, probably, the Oval Office.
But I agree with Charles Krauthammer, who contended recently on Fox News that Americans need a serious, knock-down, drag-out debate about the nation's direction at least once every generation.
That's what is occurring now. The recent debt limit debates and so-called (faux) crisis is merely the opening shot in that battle.
If you can objectively observe the trends of the past four years, it's pretty clear that the election of an inexperienced, spendthrift Senator from Illinois to the presidency, along with majorities in both houses of Congress, was the breaking point.
Now momentum has moved back the other way."
David Rivkin, Jr., and Lee Casey, attorneys who served in the Department of Justice during the Ronald Reagan and George H.W. Bush administrations, wrote an editorial in Tuesday's edition of the Wall Street Journal entitled A Debt Deal The Founders Could Love. In it, they expanded on a similar point, eschewing this sudden love of bi-partisan compromise by Democrats,
"The debt-ceiling crisis has prompted predictable media laments about how partisan and dysfunctional our political system has become. But if the process leading to the current deal was a "spectacle" and a "three-ring circus," as Obama adviser David Plouffe put it, the show's impresarios are none other than James Madison and Alexander Hamilton. Our messy political system is working exactly the way our Founders intended it to.
To the extent House members were the most intransigent during the process—a matter of opinion, in any case—they were meant to be. The House of Representatives is the "popular branch," as described in The Federalist Papers, and was intended to "have an immediate dependence on, and an intimate sympathy with, the people." Many people, especially those who elected tea party candidates last November, passionately believe that the federal government has gone off the rails. They think that Washington has been spending like a drunken sailor since President Obama took office, and that this profligacy must end.
By contrast, the Framers conceived the Senate as a body of graybeards (or, at the very least, as modestly mature individuals who have reached the age of 30). It was meant to represent the interests of the states and to serve as a check on "the impulse of sudden and violent passions," or the danger of "factious leaders" offering "intemperate and pernicious resolutions" that might in time characterize the lower house. If the Senate has been less willing than the House to call an immediate halt to federal borrowing and to seek a more gradual return to fiscal responsibility, this too is exactly what it is supposed to do.
The result was a compromise, as it has nearly always been throughout our history. This will be a disappointment to many who voted for real and immediate fiscal restraint, but that too is to be expected. The Framers believed in gradual change. They prized stability and predictability. Most would have agreed with Talleyrand's injunction—"above all, not too much zeal"—and themselves watched as Talleyrand learned this lesson the hard way. An early and enthusiastic participant in the French Revolution, France's future foreign minister was forced to take refuge in the United States after his countrymen started cutting off heads.
Accordingly, the Framers rejected a parliamentary system of government, where power is concentrated in the legislature and very often in one house of the legislature. There truly are winners and losers in such political systems, and governmental policy can indeed be transformed immediately after a new government takes office.
By contrast, our Constitution diffuses power both vertically among the federal government and states and horizontally among the three branches of the federal government—and then again within Congress itself. Change, even good and necessary change, is always difficult. It must be based on consensus.
Yes, reaching consensus on any issue that matters is messy. Shouting and intransigence are commonplace in such battles and have been since the very beginning. Indeed, the Washington circus began well before the capital city was completed, and the Founding generation was second to none in its use of political invective. For example, Thomas Jefferson and his surrogates suggested President Washington had gone senile and claimed that John Adams was a closet monarchist. After he became president, Jefferson himself was excoriated because of an alleged sexual relationship with one of his slaves, Sally Hemmings.
Rarely in our system do the participants, whether in the House, Senate or White House, achieve all or even most of their goals in a single political battle. Sunday night, a debt-ceiling deal was reached that will raise the federal debt ceiling and permit continued borrowing to fund federal government operations through 2012 rather than just for another six months. The hard questions—taxes and spending cuts—have largely been postponed.
But the key point has been made. Few now suggest that we can continue on our current spending binge. That is the beginning of a consensus, and a good start towards genuine change. Postponing the difficult questions also means that the electorate can have its say in the 2012 elections, and represents significant political risks for all parties.
The Framers would be pleased at the "spectacle." "
Rivkin and Casey have done a wonderful job, in my opinion, of debunking, with historical examples, this commonly-, but wrongly-held notion that there was more political civility in our Republic's olden times. One often hears these appeals for bi-partisanship, compromise and civility when a party or leader knows they possess a very weak position, either in terms of votes or ideology.
In this most recent case, the debt limit battle, the Democrats were weak on both counts. Thus, the appeal for compromise in order to attempt to hide their weakness on spending and rather naked desire to simply be given the license to embark on a few trillion dollars more in American indebtedness.
While it's true that the ultimate amount of spending cuts were minuscule, and the debt ceiling was raised by an amount ($2.4T) calculated by Wonderboy to allow him to get through the next election before seeking to raise it again, the tide has turned, and Tea Party-inspired legislators who voted for the anemic bill made their point.
And it's not finished. Michele Bachmann voted no and, I am sure, will use that vote to bludgeon any fellow candidates for the GOP presidential nomination, should they voice support of the bill, as passed.
It would have done no good for the US to have gone through the trouble of allocating incoming tax receipts to pay debt interest and some necessary expenses, while shutting down parts of the federal government. But the near-run partial shutdown proved a point.
It substantially eroded Wonderboy's remaining low levels of power and standing with voters. I suspect, given the excessive rhetoric of Democratic Senators and the VP, calling Tea Party-backed legislators "terrorists" won't have endeared that party to voters, come 2012. Not to mention Harry Reid's continuing insistence that he wants to raise taxes so he can hand Wonderboy more money to waste.
Even if the GOP can't field a candidate who defeats Wonderboy next year, the Senate is likely to shift to GOP control, making the First Rookie's second term, if there is one, essentially pointless.
But, as Rivkin and Casey imply, America gets the government it wants and deserves. It tried Democratic hegemony for two years, and found it unacceptable. As I wrote in the earlier post, were the entire Senate up for re-election last November, chances are the Republicans would control that chamber now, too.
Come 2012, though, sufficient numbers of independents could be so wary of continued Democratic control of any federal branch of government that even a weak GOP presidential candidate will be washed into office along with majorities in both houses of Congress. To begin the work of cutting back federal government size, reach and spending.
Yes, it sure is messy when government change occurs 33 Senate seats, 435 House seats at a time, every two years, and the Oval Office only once each four years. It makes for halting, erratic government during the big power shifts.
But I sense a trifecta coming for the GOP in 2012 now that the Democrats showed their true colors during the debt ceiling battle, i.e., raise taxes, borrow more, spend more.
I believe most voting Americans no longer want that type of federal government. And when they get what they want next year, it won't look so messy anymore.
Wednesday, August 3, 2011
Eric Cantor & The Debt Limit Bill
Gerald Seib wrote a thoughtful piece in the Wall Street Journal this week profiling Eric Cantor's enhanced stature coming out of the debt ceiling debates and bill.
Seib's conclusions matched my own, i.e., that Cantor is as much a voice and leader of the House GOP Tea Party freshmen as anyone, and provided the necessary pressure on John Boehner to keep him out of deals involving more or higher taxes.
I was surprised to learn of Cantor's apparent bonding with Washington court jester Joe Biden. However, with luck, that's not going to be a relevant relationship in a little over another year.
Mostly, though, I appreciated Seib's characterization of Cantor as providing a mix of Tea Party anti-spending, anti-tax fervor with a recognition that failure on the part of the GOP to deliver some sort of legislation which avoided Wonderboy claiming default, while at least beginning to cut spending, was unacceptable.
The House GOP leadership is pretty much where I had hoped and thought it would arrive. Boehner having years in the House to provide some seasoned political sense, with Cantor, Ryan and McCarthy delivering the fresh thinking and Tea Party-driven spirit of lower spending.
Seib's conclusions matched my own, i.e., that Cantor is as much a voice and leader of the House GOP Tea Party freshmen as anyone, and provided the necessary pressure on John Boehner to keep him out of deals involving more or higher taxes.
I was surprised to learn of Cantor's apparent bonding with Washington court jester Joe Biden. However, with luck, that's not going to be a relevant relationship in a little over another year.
Mostly, though, I appreciated Seib's characterization of Cantor as providing a mix of Tea Party anti-spending, anti-tax fervor with a recognition that failure on the part of the GOP to deliver some sort of legislation which avoided Wonderboy claiming default, while at least beginning to cut spending, was unacceptable.
The House GOP leadership is pretty much where I had hoped and thought it would arrive. Boehner having years in the House to provide some seasoned political sense, with Cantor, Ryan and McCarthy delivering the fresh thinking and Tea Party-driven spirit of lower spending.
Tuesday, August 2, 2011
When Compromise Becomes A Virtue
Isn't it funny that when Democrats can't get what they want by ramming bills through Congress with majorities in both houses, they suddenly discover compromise?
Remember how, in early 2010, after Scott Brown of Massachusetts became the 41st Republican Senator in a special election, the Democrats, far from working to compromise on ObamaCare, contorted the process of passing the bill in order to avoid any compromise with Republicans, instead, ramming the bill through as a spending bill, rather than a policy-focused health care bill?
Now, during the current debt limit increase process, because Harry Reid and Wonderboy can't get what they want, they brand the newly-elected Republican Representatives and Senators who bring with them a new voter preference for fiscal rectitude and lower spending as terrorists, while they now preach compromise.
They trot out that old Washington refrain,
'The voters want us to work together to get something done. They don't understand all this partisan extremism and bickering.'
Actually, they do. And we know for a fact that voters in at least 87 House districts, the ones which elected freshmen GOP members, and a handful of states which elected Senators like Marco Rubio, Rand Paul, and other Tea Party-inclined GOP freshmen Senators, don't care about bi-partisanship which allows the free-spending liberal Democrats to continue their usual Washington ways.
What I believe we are seeing is not a new emphasis on bi-partisanship, but a fleeting moment of collaboration to do the minimum necessary to operate the federal government, until the 2012 elections sweep Democrats from their control of the Senate and, probably, the Oval Office.
Then compromise won't be required anymore- again. Only then, the GOP will be able to cut spending, borrowing, entitlements, and enact meaningful tax reform with fewer preference items and lower rates.
All without compromise.
That's when you won't hear the word compromise from House and Senate minority leaders anymore.
But I agree with Charles Krauthammer, who contended recently on Fox News that Americans need a serious, knock-down, drag-out debate about the nation's direction at least once every generation.
That's what is occurring now. The recent debt limit debates and so-called (faux) crisis is merely the opening shot in that battle.
If you can objectively observe the trends of the past four years, it's pretty clear that the election of an inexperienced, spendthrift Senator from Illinois to the presidency, along with majorities in both houses of Congress, was the breaking point.
Now momentum has moved back the other way.
As I write this at 4PM on Monday afternoon, Boehner and his leadership team has just finished their press conference. They didn't get all they wanted. The debt limit bill isn't a conservative's dream. But it at least has, as Paul Ryan asserted, changed the direction in spending at the federal level for the first time in decades.
The real heavy lifting will occur after 2012. Until then, it'll be a holding action as the GOP prevents wild spending in reaction to recent weak economic data. But the stage appears to be set now for a longer term move toward conservative values on federal spending, debt and taxes.
Remember how, in early 2010, after Scott Brown of Massachusetts became the 41st Republican Senator in a special election, the Democrats, far from working to compromise on ObamaCare, contorted the process of passing the bill in order to avoid any compromise with Republicans, instead, ramming the bill through as a spending bill, rather than a policy-focused health care bill?
Now, during the current debt limit increase process, because Harry Reid and Wonderboy can't get what they want, they brand the newly-elected Republican Representatives and Senators who bring with them a new voter preference for fiscal rectitude and lower spending as terrorists, while they now preach compromise.
They trot out that old Washington refrain,
'The voters want us to work together to get something done. They don't understand all this partisan extremism and bickering.'
Actually, they do. And we know for a fact that voters in at least 87 House districts, the ones which elected freshmen GOP members, and a handful of states which elected Senators like Marco Rubio, Rand Paul, and other Tea Party-inclined GOP freshmen Senators, don't care about bi-partisanship which allows the free-spending liberal Democrats to continue their usual Washington ways.
What I believe we are seeing is not a new emphasis on bi-partisanship, but a fleeting moment of collaboration to do the minimum necessary to operate the federal government, until the 2012 elections sweep Democrats from their control of the Senate and, probably, the Oval Office.
Then compromise won't be required anymore- again. Only then, the GOP will be able to cut spending, borrowing, entitlements, and enact meaningful tax reform with fewer preference items and lower rates.
All without compromise.
That's when you won't hear the word compromise from House and Senate minority leaders anymore.
But I agree with Charles Krauthammer, who contended recently on Fox News that Americans need a serious, knock-down, drag-out debate about the nation's direction at least once every generation.
That's what is occurring now. The recent debt limit debates and so-called (faux) crisis is merely the opening shot in that battle.
If you can objectively observe the trends of the past four years, it's pretty clear that the election of an inexperienced, spendthrift Senator from Illinois to the presidency, along with majorities in both houses of Congress, was the breaking point.
Now momentum has moved back the other way.
As I write this at 4PM on Monday afternoon, Boehner and his leadership team has just finished their press conference. They didn't get all they wanted. The debt limit bill isn't a conservative's dream. But it at least has, as Paul Ryan asserted, changed the direction in spending at the federal level for the first time in decades.
The real heavy lifting will occur after 2012. Until then, it'll be a holding action as the GOP prevents wild spending in reaction to recent weak economic data. But the stage appears to be set now for a longer term move toward conservative values on federal spending, debt and taxes.
Saturday, July 30, 2011
You Know They're Scared When Democrats Declare GOP Bills DOA
Isn't it funny how something as reciprocal as compromise is taken hostage by one party to use against the/another?
Boehner's debt limit bill hadn't even passed in the House yet yesterday, but Wonderboy, Harry Reid, Dick Durbin and Chuckie Schumer all pronounced it DOA- Dead On Arrival.
And yet, in doing so, none of those Democrats thought or worried they would look recalcitrant, intractable or unreasonable. All of which they are.
When in a process that will probably require compromise, who is to say whose ideas are unacceptable or DOA?
What if Boehner had come out earlier and declared that anything but his House bill would be DOA when it came back for reconciliation in that chamber? How would Wonderboy and Harry have reacted to that?
What's worse is, all that Boehner and his colleagues have done is reacted to the 2010 election results and the public's disgust with decades of overspending. The House GOP has sensibly paired a debt limit increase with spending cuts and, while questionable, the understandable appeal to write and pass a Constitutional amendment for a balanced budget.
I laughed and turned the channel when I heard Dick Durbin sputtering about how unnatural and unreasonable it was for the House to attach a BBA demand to a debt limit increase.
Here's another perspective on the whole process. One which esteemed conservative pundit and Fox News contributor Charles Krauthammer echoed on Friday evening on Brett Baier's program, in contrast to a liberal kiss-up, whiny guest on the panel at the program's end.
Essentially, what we are witnessing is a seismic political shift begun by the election of a core of about 87 Tea Party House members and a handful of Tea Party Senators from the GOP last November. They are sufficiently numerous to affect House bills. If 100 Senators had been up for re-election last year, instead of only 32 or 33, it's quite possible that the GOP, with its Tea Party component, would have taken control of that chamber, as well.
But, as it is, a new political wind is blowing through Congress. Dick Durbin's astonishment notwithstanding, the new House members represent the public's awakening to the unwanted actions of its Congresses of the past several decades.
As Krauthahammer intoned, and I heartily agree, screw bipartisanship. You need a good partisan battle over the nation's direction at the federal level at least once every generation. This is that moment, in the post-Reagan era.
It's pretty clear that, based on his last three years of behavior, Wonderboy couldn't be re-elected today if it was a strictly 'yes/no' vote. The Senate will probably go Republican next year.
For Democrats to simply scream that it's outrageous to attach spending cuts to a debt limit increase, and try to curb spending both now and in the future, tells you they are scared. Scared to death that they've finally maxed out the nation's federal credit card and lines, and won't be able to continue with their lavish social programs.
In fact, despite their cries that Republicans want to preserve tax cuts for "the rich" while cutting Social Security, Medicare and Medicaid, that's precisely what's going to happen, more or less. With time, tax rates will fall, special deductions and tax preferences will disappear, and overall tax receipts will rise as the economy recovers. But the bases for determining social spending will have to be shifted toward current defined contributions. There's simply no other way for such promised benefits to be sustained into the future.
That Wonderboy and his Senate and House minions are screaming 'DOA' to Boehner and his plan simply telegraphs how truly scared they now are, having seen the inevitable handwriting on the wall.
Boehner's debt limit bill hadn't even passed in the House yet yesterday, but Wonderboy, Harry Reid, Dick Durbin and Chuckie Schumer all pronounced it DOA- Dead On Arrival.
And yet, in doing so, none of those Democrats thought or worried they would look recalcitrant, intractable or unreasonable. All of which they are.
When in a process that will probably require compromise, who is to say whose ideas are unacceptable or DOA?
What if Boehner had come out earlier and declared that anything but his House bill would be DOA when it came back for reconciliation in that chamber? How would Wonderboy and Harry have reacted to that?
What's worse is, all that Boehner and his colleagues have done is reacted to the 2010 election results and the public's disgust with decades of overspending. The House GOP has sensibly paired a debt limit increase with spending cuts and, while questionable, the understandable appeal to write and pass a Constitutional amendment for a balanced budget.
I laughed and turned the channel when I heard Dick Durbin sputtering about how unnatural and unreasonable it was for the House to attach a BBA demand to a debt limit increase.
Here's another perspective on the whole process. One which esteemed conservative pundit and Fox News contributor Charles Krauthammer echoed on Friday evening on Brett Baier's program, in contrast to a liberal kiss-up, whiny guest on the panel at the program's end.
Essentially, what we are witnessing is a seismic political shift begun by the election of a core of about 87 Tea Party House members and a handful of Tea Party Senators from the GOP last November. They are sufficiently numerous to affect House bills. If 100 Senators had been up for re-election last year, instead of only 32 or 33, it's quite possible that the GOP, with its Tea Party component, would have taken control of that chamber, as well.
But, as it is, a new political wind is blowing through Congress. Dick Durbin's astonishment notwithstanding, the new House members represent the public's awakening to the unwanted actions of its Congresses of the past several decades.
As Krauthahammer intoned, and I heartily agree, screw bipartisanship. You need a good partisan battle over the nation's direction at the federal level at least once every generation. This is that moment, in the post-Reagan era.
It's pretty clear that, based on his last three years of behavior, Wonderboy couldn't be re-elected today if it was a strictly 'yes/no' vote. The Senate will probably go Republican next year.
For Democrats to simply scream that it's outrageous to attach spending cuts to a debt limit increase, and try to curb spending both now and in the future, tells you they are scared. Scared to death that they've finally maxed out the nation's federal credit card and lines, and won't be able to continue with their lavish social programs.
In fact, despite their cries that Republicans want to preserve tax cuts for "the rich" while cutting Social Security, Medicare and Medicaid, that's precisely what's going to happen, more or less. With time, tax rates will fall, special deductions and tax preferences will disappear, and overall tax receipts will rise as the economy recovers. But the bases for determining social spending will have to be shifted toward current defined contributions. There's simply no other way for such promised benefits to be sustained into the future.
That Wonderboy and his Senate and House minions are screaming 'DOA' to Boehner and his plan simply telegraphs how truly scared they now are, having seen the inevitable handwriting on the wall.
Wednesday, July 27, 2011
Debt Ceiling Durations- Do The Math!
Charles Krauthammer made a wonderful point last night on Bret Baier's 6PM Fox News program.
Citing Wonderboy's recent speech which lionized Reagan, then quickly demanded a 2-year debt limit extension, the well-regarded conservative pundit noted the following.
During Reagan's two terms, the debt limit was raised approximately 18 times. Dividing the 96 months of Reagan's Presidency by 18 debt limit increases results in an average duration of 5-6 months.
So the First Rookie is, once again, playing fast and loose with the facts. Reagan, whom he now praises, presided over debt limit increases which lasted far less than what he now demands.
Typical......
Also typical is the fact that nobody in the print or broadcast media caught this error, either.
Citing Wonderboy's recent speech which lionized Reagan, then quickly demanded a 2-year debt limit extension, the well-regarded conservative pundit noted the following.
During Reagan's two terms, the debt limit was raised approximately 18 times. Dividing the 96 months of Reagan's Presidency by 18 debt limit increases results in an average duration of 5-6 months.
So the First Rookie is, once again, playing fast and loose with the facts. Reagan, whom he now praises, presided over debt limit increases which lasted far less than what he now demands.
Typical......
Also typical is the fact that nobody in the print or broadcast media caught this error, either.
Debt Limit Updates
Last night on Sean Hannity's program, Republican Senators Tom Coburn and Saxby Chambliss, both members of the so-called Gang of Six, directly repudiated the notion that their meetings and proposals were ever intended to affect the debt limit issue.
Chambliss explicitly accused Wonderboy of grabbing the Gang of Six efforts for cover in order to disguise and obscure his lack of leadership on fiscal matters.
Earlier on Fox News, Charles Krauthammer opined on the House GOP Tea Party-backed members' objections to Boehner's plan. He made the argument, very effectively, that for those House members to fail to back Boehner, and trigger a crisis, was to become co-owners of the Wonderboy's lackluster economy and any resulting negative economic consequences.
Krauthammer then reiterated that the real goal is 2012, not August 2nd. That a failure of the House to pass Boehner's bill, demonstrating an ability to offer a solution, will mean failure next year to win the Senate and White House.
Sage remarks indeed.
Chambliss explicitly accused Wonderboy of grabbing the Gang of Six efforts for cover in order to disguise and obscure his lack of leadership on fiscal matters.
Earlier on Fox News, Charles Krauthammer opined on the House GOP Tea Party-backed members' objections to Boehner's plan. He made the argument, very effectively, that for those House members to fail to back Boehner, and trigger a crisis, was to become co-owners of the Wonderboy's lackluster economy and any resulting negative economic consequences.
Krauthammer then reiterated that the real goal is 2012, not August 2nd. That a failure of the House to pass Boehner's bill, demonstrating an ability to offer a solution, will mean failure next year to win the Senate and White House.
Sage remarks indeed.
Tuesday, July 26, 2011
More Reflections On The "Super Congress"
In Sunday's post I expressed my initial reaction to the so-called Super Congress being bandied about by Harry Reid to resolve the federal spending crisis,
"On that theme, I find the Senate's floating of the concept of a 'Super Congress' of a dozen members drawn from the two parties and each chamber, equally, to wrestle with spending and debt problems, to be the height of both arrogance and evasion of responsibility.
I think American voters are tiring of so many important fiscal decisions taking place among a few legislators behind closed doors. If I were cynical, I'd suggest this Super Congress is an attempt to freeze out the influence of the Tea Party movement.
Of course, one wonders if it's even Constitutional. For sure, it's yet another sign that our elected Congress members can't seem to just do their job, and look to endlessly pass the buck to various Commissions, study groups, committees and such."
I'm writing this on Sunday evening, so there may have been subsequent repudiation of the idea before this publishes. No matter.
As I've mulled the concept over this afternoon, I find it increasingly repugnant and indicative of a chamber totally out of touch with the American electorate.
Of course, only 33 or so members were elected, leaving the Democats in control, so that may explain the Senate's failure to comprehend the scope and nature of the Tea Party-triggered insistence of so many voters for deep, lasting spending cuts.
The House, being totally elected every two years, is much closer, by design, to the voters' impulses. I don't think the GOP House members will countenance such an abrogation of it's chamber's Constitutional power to originate spending bills. Handing this off to a commission half-composed of Senators isn't going to sit well with them.
Moreover, it seems to me that only hoary Senators could possibly miss the disgust of most voters with Washington's way of doing business. Thinking that by officially closeting a few Senators and Representatives behind closed doors, the very weighty issues of cutting spending and entitlements can be re/solved.
These are the very cornerstones of liberal Democratic idiocy dating back to 1935. There's no way that their restructuring will be legitimate if conceived in secret by 12 members of Congress.
Better, instead, to nominate a spectrum of private sector and academic cognoscenti to suggest an array of options.
The last people you'd trust with knowing how to handle fixing such poorly-designed programs are 12 members of Congress- Democratic or Republican.
But the larger issue is that Reid and other Senators are so conceited as to think that creating a sub-Congress to do what they don't seem to be able to do is acceptable to voters. They duck doing their jobs, then think that by some sleight of hand, they can fool voters.
Let's replace every one of the bastards in the Senate- or House- who dares vote for such a contemptible way out of just fixing the massive entitlement mistakes in Congress, in the open, as they all were elected to do.
"On that theme, I find the Senate's floating of the concept of a 'Super Congress' of a dozen members drawn from the two parties and each chamber, equally, to wrestle with spending and debt problems, to be the height of both arrogance and evasion of responsibility.
I think American voters are tiring of so many important fiscal decisions taking place among a few legislators behind closed doors. If I were cynical, I'd suggest this Super Congress is an attempt to freeze out the influence of the Tea Party movement.
Of course, one wonders if it's even Constitutional. For sure, it's yet another sign that our elected Congress members can't seem to just do their job, and look to endlessly pass the buck to various Commissions, study groups, committees and such."
I'm writing this on Sunday evening, so there may have been subsequent repudiation of the idea before this publishes. No matter.
As I've mulled the concept over this afternoon, I find it increasingly repugnant and indicative of a chamber totally out of touch with the American electorate.
Of course, only 33 or so members were elected, leaving the Democats in control, so that may explain the Senate's failure to comprehend the scope and nature of the Tea Party-triggered insistence of so many voters for deep, lasting spending cuts.
The House, being totally elected every two years, is much closer, by design, to the voters' impulses. I don't think the GOP House members will countenance such an abrogation of it's chamber's Constitutional power to originate spending bills. Handing this off to a commission half-composed of Senators isn't going to sit well with them.
Moreover, it seems to me that only hoary Senators could possibly miss the disgust of most voters with Washington's way of doing business. Thinking that by officially closeting a few Senators and Representatives behind closed doors, the very weighty issues of cutting spending and entitlements can be re/solved.
These are the very cornerstones of liberal Democratic idiocy dating back to 1935. There's no way that their restructuring will be legitimate if conceived in secret by 12 members of Congress.
Better, instead, to nominate a spectrum of private sector and academic cognoscenti to suggest an array of options.
The last people you'd trust with knowing how to handle fixing such poorly-designed programs are 12 members of Congress- Democratic or Republican.
But the larger issue is that Reid and other Senators are so conceited as to think that creating a sub-Congress to do what they don't seem to be able to do is acceptable to voters. They duck doing their jobs, then think that by some sleight of hand, they can fool voters.
Let's replace every one of the bastards in the Senate- or House- who dares vote for such a contemptible way out of just fixing the massive entitlement mistakes in Congress, in the open, as they all were elected to do.
Sunday, July 24, 2011
"Super Congress" & Wonderboy's State of Denial
It's incredible to listen to Wonderboy's comments in his increasingly-frequent public appearances which indicate he's in denial about his responsibility for the current debt limit problem.
Speaking as if some unnamed third party embarked on the orgy of borrowing and spending which the First Rookie led since his election, he now complains that Republicans won't just raise taxes and the debt limit so he can continue to destroy the American economy.
Hasn't it occurred to people, especially Wonderboy, that if he hadn't demanded the stimulus, the health care bill and other activities which have swelled federal spending to 24% of GDP, we wouldn't need to be raising the debt limit?
Personally, as I wrote in this post last Sunday on my companion business blog, it could well be that a temporary default would be a good thing if it leads to permanently-reduced federal spending and borrowing.
On that theme, I find the Senate's floating of the concept of a 'Super Congress' of a dozen members drawn from the two parties and each chamber, equally, to wrestle with spending and debt problems, to be the height of both arrogance and evasion of responsibility.
I think American voters are tiring of so many important fiscal decisions taking place among a few legislators behind closed doors. If I were cynical, I'd suggest this Super Congress is an attempt to freeze out the influence of the Tea Party movement.
Of course, one wonders if it's even Constitutional. For sure, it's yet another sign that our elected Congress members can't seem to just do their job, and look to endlessly pass the buck to various Commissions, study groups, committees and such.
I know all about the military base-closing commission. But this isn't something relatively tangential as that was. This topic- spending and borrowing to fund it- is now central to the American economy and national politics and government.
Allowing 12 people, out of 535, to decide how to do that, is to effectively nullify the other 523. It's wrong and cowardly.
Speaking as if some unnamed third party embarked on the orgy of borrowing and spending which the First Rookie led since his election, he now complains that Republicans won't just raise taxes and the debt limit so he can continue to destroy the American economy.
Hasn't it occurred to people, especially Wonderboy, that if he hadn't demanded the stimulus, the health care bill and other activities which have swelled federal spending to 24% of GDP, we wouldn't need to be raising the debt limit?
Personally, as I wrote in this post last Sunday on my companion business blog, it could well be that a temporary default would be a good thing if it leads to permanently-reduced federal spending and borrowing.
On that theme, I find the Senate's floating of the concept of a 'Super Congress' of a dozen members drawn from the two parties and each chamber, equally, to wrestle with spending and debt problems, to be the height of both arrogance and evasion of responsibility.
I think American voters are tiring of so many important fiscal decisions taking place among a few legislators behind closed doors. If I were cynical, I'd suggest this Super Congress is an attempt to freeze out the influence of the Tea Party movement.
Of course, one wonders if it's even Constitutional. For sure, it's yet another sign that our elected Congress members can't seem to just do their job, and look to endlessly pass the buck to various Commissions, study groups, committees and such.
I know all about the military base-closing commission. But this isn't something relatively tangential as that was. This topic- spending and borrowing to fund it- is now central to the American economy and national politics and government.
Allowing 12 people, out of 535, to decide how to do that, is to effectively nullify the other 523. It's wrong and cowardly.
Friday, July 22, 2011
Karl Rove's Perspective On The Latest Debt Ceiling Maneuvering
As I suspected, and wrote in yesterday's post, the Senate's 'Gang of Six' so-called proposal for a debt limit increase has been roundly criticized by even other Senators as incapable of being written into law before Wonderboy's self-imposed August 2nd deadline.
Both Rand Paul and Jim DeMint have explained that there's not a hope in hell of all the legislative detail being negotiated on all the aspects of the Gang's detail-less grand bargain.
Karl Rove noted in his Thursday Wall Street Journal column that this suits the First Rookie just fine. Promises of future spending cuts, unspecified tax and entitlement reforms to be explained later is a plan he can sign up for. So he gave a special press conference just to announce it.
Rove, however, threw his weight behind Paul Ryan's GOP House members. He points out that they have passed the only legitimate bill to raise the debt limit, this week's Cut, Cap and Balanced bill. Harry Reid's so fearful of it he refused to schedule debate or a vote on it in the Senate, then called on Democratic Senators to filibuster it, should it make it to the floor for discussion.
Rove went on to advise that the House GOP push harder in these last days, adding the various tax reforms which Wonderboy has nattered on about for weeks, and are now the subject of several left-wing cable television ads. Doing so, Rove points out, will disarm the liberals opposing the House bill, while adding yet more pressure on the president and the Democratically-controlled Senate.
Rove, Jim DeMint and former Clinton advisor Dick Morris all stress that the House GOP must prepare themselves to be more vocal as they sell their accomplishments to voters and stress that Wonderboy and the Senate offer no detailed plans in opposition. Throughout all of the hoopla over the debt limit, as Paul Ryan has said several times, the president has not once provided a detailed plan for spending cuts, tax reforms, or anything associated with raising the debt limit. He's been, predictably, all talk and no action.
Worse, he's threatened to stop paying debt interest, Social Security obligations and military compensation, to raise the ante. But all Congressional Republicans whom I've heard speak assert that doing so is the president's choice, but not necessary. Further, some House GOP members are talking of including 'must-pay' language in a subsequent debt limit increase bill.
Just as he let Frisco Nan write the stimulus health care bills, Wonderboy is now gravitating to Kent Conrad's vapor-bill. Conrad attempted to silence critics by claiming that they are trying to kill his 'plan' before learning more about it, but that's simply untrue. There are no details to it- that's why Democrats want to support it.
Let's hope Paul Ryan, John Boehner and Eric Cantor are listening to Rove, DeMint, Rand and their ilk and continue to press their advantage without caving in to Democratic demands for higher taxes and unspecified future spending cuts in exchange for a debt ceiling increase.
Both Rand Paul and Jim DeMint have explained that there's not a hope in hell of all the legislative detail being negotiated on all the aspects of the Gang's detail-less grand bargain.
Karl Rove noted in his Thursday Wall Street Journal column that this suits the First Rookie just fine. Promises of future spending cuts, unspecified tax and entitlement reforms to be explained later is a plan he can sign up for. So he gave a special press conference just to announce it.
Rove, however, threw his weight behind Paul Ryan's GOP House members. He points out that they have passed the only legitimate bill to raise the debt limit, this week's Cut, Cap and Balanced bill. Harry Reid's so fearful of it he refused to schedule debate or a vote on it in the Senate, then called on Democratic Senators to filibuster it, should it make it to the floor for discussion.
Rove went on to advise that the House GOP push harder in these last days, adding the various tax reforms which Wonderboy has nattered on about for weeks, and are now the subject of several left-wing cable television ads. Doing so, Rove points out, will disarm the liberals opposing the House bill, while adding yet more pressure on the president and the Democratically-controlled Senate.
Rove, Jim DeMint and former Clinton advisor Dick Morris all stress that the House GOP must prepare themselves to be more vocal as they sell their accomplishments to voters and stress that Wonderboy and the Senate offer no detailed plans in opposition. Throughout all of the hoopla over the debt limit, as Paul Ryan has said several times, the president has not once provided a detailed plan for spending cuts, tax reforms, or anything associated with raising the debt limit. He's been, predictably, all talk and no action.
Worse, he's threatened to stop paying debt interest, Social Security obligations and military compensation, to raise the ante. But all Congressional Republicans whom I've heard speak assert that doing so is the president's choice, but not necessary. Further, some House GOP members are talking of including 'must-pay' language in a subsequent debt limit increase bill.
Just as he let Frisco Nan write the stimulus health care bills, Wonderboy is now gravitating to Kent Conrad's vapor-bill. Conrad attempted to silence critics by claiming that they are trying to kill his 'plan' before learning more about it, but that's simply untrue. There are no details to it- that's why Democrats want to support it.
Let's hope Paul Ryan, John Boehner and Eric Cantor are listening to Rove, DeMint, Rand and their ilk and continue to press their advantage without caving in to Democratic demands for higher taxes and unspecified future spending cuts in exchange for a debt ceiling increase.
Thursday, July 21, 2011
Paul Ryan On The Latest Senate "Gang of Six" Proposal
On Tuesday evening, I caught Paul Ryan's interview on Sean Hannity's Fox News program. It was quite revealing.
I think I was most surprised and, in a way, heartened, by Ryan's reference to an old House saying,
'The other party is your adversary but the Senate is the enemy.'
And so it seems this week.
Smarmy Democratic Senator Kent Conrad, who never met a tax hike he didn't like, declares earnestly that his mix of taxes increases, called 'reform' by the suspect Conrad, entitlement 'reforms,' and spending cuts will address the country's deficit problems.
But Conrad already tips his hand by piling on other issues to what is a spending problem, not a deficit problem, per se.
What is inexplicable is why Tom Coburn joined this latest travesty.
Ryan was quite sanguine and blunt in saying that the alleged several trillion dollars of lower deficits from the Senate plan were neither clear nor specific, with no details whatsoever on what spending was to be cut. But what was clear is that the Senators are playing games, claiming cuts from 'baselines,' rather than absolute cuts. The Senate, meaning Conrad, hasn't passed a budget in 800+ days, or nearly three years.
Since the House originates funding bills, and Ryan is chairman of it's Budget Committee, I take Ryan's comments to heart. He doesn't trust the Senate, and he doesn't mention party affiliation.
Once more, I find solace in the midst of this comedy involving the debt limit by seeing the Founders' checks and balances at work.
It seems to me that Ryan sees the Senate as detached from reality, not focused on what Ryan and his freshman, Tea Party-backed colleagues, understand, which is that, more than anything else, Americans want federal spending cut.
Yes, entitlement and tax reform are good things to accomplish. But lumping them in with the debt limit and spending cuts suggests that all these items are negotiable.
I think Ryan and his House colleagues realize what Senators do not, i.e., the debt limit issue is about current and near-term spending. Not taxes or entitlements, per se.
From Ryan's answers to Hannity, it doesn't seem likely that House GOP members are interested in budging from passing a debt limit increase only upon cutting current and near-term spending significantly. Period. Rand Paul was interviewed on Sean Hannity's program last night, and his position is essentially identical to Ryan's positions. Paul castigated Conrad's so-called 'plan,' saying it's not a plan and legislation written to implement it would result in another multi-thousand-page bill finished only hours before a vote to pass it, like the stimulus and health care bills.
Right now I'm hearing Democratic blowhard Barney Frank whine and complain about House GOP members, calling them inflexible, too conservative, etc. In short, they are getting in the way of his need to wastefully spend more of your tax dollars, and whatever borrowed Chinese money he needs, too.
Thanks to the Constitution's checks and balances, Wonderboy's attempt to rush through tax increases and future spending cuts that will never occur, in order to get his debt limit increase, look unlikely to succeed.
I think I was most surprised and, in a way, heartened, by Ryan's reference to an old House saying,
'The other party is your adversary but the Senate is the enemy.'
And so it seems this week.
Smarmy Democratic Senator Kent Conrad, who never met a tax hike he didn't like, declares earnestly that his mix of taxes increases, called 'reform' by the suspect Conrad, entitlement 'reforms,' and spending cuts will address the country's deficit problems.
But Conrad already tips his hand by piling on other issues to what is a spending problem, not a deficit problem, per se.
What is inexplicable is why Tom Coburn joined this latest travesty.
Ryan was quite sanguine and blunt in saying that the alleged several trillion dollars of lower deficits from the Senate plan were neither clear nor specific, with no details whatsoever on what spending was to be cut. But what was clear is that the Senators are playing games, claiming cuts from 'baselines,' rather than absolute cuts. The Senate, meaning Conrad, hasn't passed a budget in 800+ days, or nearly three years.
Since the House originates funding bills, and Ryan is chairman of it's Budget Committee, I take Ryan's comments to heart. He doesn't trust the Senate, and he doesn't mention party affiliation.
Once more, I find solace in the midst of this comedy involving the debt limit by seeing the Founders' checks and balances at work.
It seems to me that Ryan sees the Senate as detached from reality, not focused on what Ryan and his freshman, Tea Party-backed colleagues, understand, which is that, more than anything else, Americans want federal spending cut.
Yes, entitlement and tax reform are good things to accomplish. But lumping them in with the debt limit and spending cuts suggests that all these items are negotiable.
I think Ryan and his House colleagues realize what Senators do not, i.e., the debt limit issue is about current and near-term spending. Not taxes or entitlements, per se.
From Ryan's answers to Hannity, it doesn't seem likely that House GOP members are interested in budging from passing a debt limit increase only upon cutting current and near-term spending significantly. Period. Rand Paul was interviewed on Sean Hannity's program last night, and his position is essentially identical to Ryan's positions. Paul castigated Conrad's so-called 'plan,' saying it's not a plan and legislation written to implement it would result in another multi-thousand-page bill finished only hours before a vote to pass it, like the stimulus and health care bills.
Right now I'm hearing Democratic blowhard Barney Frank whine and complain about House GOP members, calling them inflexible, too conservative, etc. In short, they are getting in the way of his need to wastefully spend more of your tax dollars, and whatever borrowed Chinese money he needs, too.
Thanks to the Constitution's checks and balances, Wonderboy's attempt to rush through tax increases and future spending cuts that will never occur, in order to get his debt limit increase, look unlikely to succeed.
Friday, July 15, 2011
Constitutional Checks & Balances: Eric Cantor vs. Wonderboy
It's Thursday morning as I write this post. The media has been rife with stories of Wonderboy's temper tantrum last night over Eric Cantor's remarks, allegedly ending with his taunt,
'Don't call my bluff, Eric.'
Then the First Child reportedly slammed his chair into the table and stormed out of the meeting.
You know Cantor was on to something because this morning, Harry Reid is criticizing him.
But, seriously, you have to respect our Founding Fathers' design of the Constitution at moments like this. Why?
Well, we have a president, elected nearly three years ago, whose grandiose spending, borrowing and taxing schemes have come a cropper. They've failed. The economy continues to stagnate, employment hasn't rebounded, and, now, the federal debt has risen to its legal limit.
Meanwhile, a GOP House majority elected less than a year ago, on a tide of Tea Party anti-spending and -taxing fervor, are responding by passionately blocking Wonderboy's attempt to blithely continue his spending, while raising taxes, too, as his terms for signing a debt limit raise.
The specter of dozens of freshmen GOP Representatives intent on upholding their promise to constituents to cut spending while not raising taxes is a key part of James Madison's Constitutional check and balance system.
At present, however, we have a president given to tantrums and egotistical grandstanding. He demonizes those who disagree with him.
Perhaps the most ironic moment came yesterday, as Wonderboy was reported to proclaim that his presidency 'may go down' on the debt limit issue, but he wasn't going to give in to House demands for spending cuts without tax hikes.
It's the president's job to manage Treasury issues, which now include having sufficient money to fund obligations. Too bad Obama pushed Congress to spend so many trillions in the past 2 1/2 years, while his party held majorities in both houses of Congress, but neglected to take the opportunity to raise the debt limit.
This is how you know the First Rookie is, well, a rookie. A more seasoned executive would have realized, in advance, to attend to that important detail.
Now that his spending binge has hit the debt limit, Wonderboy is behaving like a three year-old, blasting everyone else and claiming to be the only adult in the room. The reality is that his own spending and borrowing, combined with his lack of managerial experience, led to this impasse.
Now a recently-elected House GOP majority is fairly representing their voters' wishes for less spending, less borrowing and no more taxes.
In opposition to those voters' wishes is an imperial president who believes he can do no wrong. And intends, as he threatened Cantor, to take to the airwaves- again and again, as he has done recently- to try to convince Americans that he is right and Cantor/Boehner are wrong.
Trouble is, as of Wednesday night, Dick Morris was explaining on Bill O'Reilly's Fox News program that polls show Americans see the president as the source of this standoff, not the GOP.
Should be an interesting July in Washington. But one thing to take solace with is that what you see is nothing more than Madison's intended design of checks on presidential imperialism specifically of the sort. Wonderboy is attempting to exercise.
'Don't call my bluff, Eric.'
Then the First Child reportedly slammed his chair into the table and stormed out of the meeting.
You know Cantor was on to something because this morning, Harry Reid is criticizing him.
But, seriously, you have to respect our Founding Fathers' design of the Constitution at moments like this. Why?
Well, we have a president, elected nearly three years ago, whose grandiose spending, borrowing and taxing schemes have come a cropper. They've failed. The economy continues to stagnate, employment hasn't rebounded, and, now, the federal debt has risen to its legal limit.
Meanwhile, a GOP House majority elected less than a year ago, on a tide of Tea Party anti-spending and -taxing fervor, are responding by passionately blocking Wonderboy's attempt to blithely continue his spending, while raising taxes, too, as his terms for signing a debt limit raise.
The specter of dozens of freshmen GOP Representatives intent on upholding their promise to constituents to cut spending while not raising taxes is a key part of James Madison's Constitutional check and balance system.
At present, however, we have a president given to tantrums and egotistical grandstanding. He demonizes those who disagree with him.
Perhaps the most ironic moment came yesterday, as Wonderboy was reported to proclaim that his presidency 'may go down' on the debt limit issue, but he wasn't going to give in to House demands for spending cuts without tax hikes.
It's the president's job to manage Treasury issues, which now include having sufficient money to fund obligations. Too bad Obama pushed Congress to spend so many trillions in the past 2 1/2 years, while his party held majorities in both houses of Congress, but neglected to take the opportunity to raise the debt limit.
This is how you know the First Rookie is, well, a rookie. A more seasoned executive would have realized, in advance, to attend to that important detail.
Now that his spending binge has hit the debt limit, Wonderboy is behaving like a three year-old, blasting everyone else and claiming to be the only adult in the room. The reality is that his own spending and borrowing, combined with his lack of managerial experience, led to this impasse.
Now a recently-elected House GOP majority is fairly representing their voters' wishes for less spending, less borrowing and no more taxes.
In opposition to those voters' wishes is an imperial president who believes he can do no wrong. And intends, as he threatened Cantor, to take to the airwaves- again and again, as he has done recently- to try to convince Americans that he is right and Cantor/Boehner are wrong.
Trouble is, as of Wednesday night, Dick Morris was explaining on Bill O'Reilly's Fox News program that polls show Americans see the president as the source of this standoff, not the GOP.
Should be an interesting July in Washington. But one thing to take solace with is that what you see is nothing more than Madison's intended design of checks on presidential imperialism specifically of the sort. Wonderboy is attempting to exercise.
Thursday, July 14, 2011
Mitch McConnell's Sensible Debt Limit Recommendation
I read yesterday's lead staff editorial in the Wall Street Journal describing GOP Senate leader Mitch McConnell's idea for Congress to allow Wonderboy to unilaterally increase the debt limit in three steps through 2012.
According to the editorial, many conservatives think McConnell is bailing out on the GOP and Tea Partiers. But I found myself agreeing with the piece's position, i.e., the Republicans, controlling only the House, and not the Senate nor White House, were not ever guaranteed of being able to force the president to compromise on the debt limit issue.
Nobody will want to be responsible for a default, so even the GOP House will eventually have to vote for the increase. McConnell sensibly sees that Wonderboy has played the 'Grandma's going to lose her Social Security because the Republicans won't make the rich pay their fair share of taxes.' Whatever fair share means in that context.
But it's a good idea to simply cut to the chase, end the faux-negotiations, and offer the Democrats an option for Wonderboy to increase the limit on his own, with no GOP votes in support.
It's impossible for a party holding only one house of Congress to make the president of the other party knuckle under on something like this. And as the Journal's editorial noted, the longer the GOP waits to relent, the worse it will look, and perhaps even be.
The piece quoted former Texas Republican Senator Phil Gramm as having said, to paraphrase,
'Don't take any hostages you aren't prepared to shoot.'
Clearly, the GOP isn't truly prepared to have the US default on its debt interest payments.
But as soon as Wonderboy went to the fear card, rather than working with Geithner to figure out how to meet the most important obligations without a debt limit increase, the GOP gambit was basically over. It's not going to shoot that hostage.
It's enough, for now, that most intelligent observers have seen that the president was never serious about cutting spending. He only wants to tax and spend some more.
Point taken.
Now the Republicans can offer a means by which the First Rookie can cement his big spending image on his own, or with House and Senate Democrats, and let the GOP continue their refinement of their spending reduction and tax reform messages for 2012.
According to the editorial, many conservatives think McConnell is bailing out on the GOP and Tea Partiers. But I found myself agreeing with the piece's position, i.e., the Republicans, controlling only the House, and not the Senate nor White House, were not ever guaranteed of being able to force the president to compromise on the debt limit issue.
Nobody will want to be responsible for a default, so even the GOP House will eventually have to vote for the increase. McConnell sensibly sees that Wonderboy has played the 'Grandma's going to lose her Social Security because the Republicans won't make the rich pay their fair share of taxes.' Whatever fair share means in that context.
But it's a good idea to simply cut to the chase, end the faux-negotiations, and offer the Democrats an option for Wonderboy to increase the limit on his own, with no GOP votes in support.
It's impossible for a party holding only one house of Congress to make the president of the other party knuckle under on something like this. And as the Journal's editorial noted, the longer the GOP waits to relent, the worse it will look, and perhaps even be.
The piece quoted former Texas Republican Senator Phil Gramm as having said, to paraphrase,
'Don't take any hostages you aren't prepared to shoot.'
Clearly, the GOP isn't truly prepared to have the US default on its debt interest payments.
But as soon as Wonderboy went to the fear card, rather than working with Geithner to figure out how to meet the most important obligations without a debt limit increase, the GOP gambit was basically over. It's not going to shoot that hostage.
It's enough, for now, that most intelligent observers have seen that the president was never serious about cutting spending. He only wants to tax and spend some more.
Point taken.
Now the Republicans can offer a means by which the First Rookie can cement his big spending image on his own, or with House and Senate Democrats, and let the GOP continue their refinement of their spending reduction and tax reform messages for 2012.
Wednesday, July 13, 2011
How Liberal News Anchors Slant Terms of the Debt Limit/Spending Debate
As I was writing this post yesterday morning, I happened to be listening to Dick Armey, former GOP House Majority Leader, guest-hosting on CNBC's morning program for an hour.
He and the co-anchors were discussing the very subject of my post- the debt limit talks.
Armey had just finished explaining why taxes should not be raised and spending should be cut when network co-anchor and liberal Becky Quick began to cut in with,
".....but if spending is cut then the economy will....."
Her remark's end was lost amidst Armey's continuing comments and her realization that her words weren't getting any attention.
But notice what Quick's baseline hypothesis is. The elevated levels of federal spending under Wonderboy, up to 24% of GDP, are now to be considered sacrosanct by such liberal apologists as CNBC's liberal anchors.
Any attempt to cut the bloated spending is criticized as what Quick was trying to say- causing economic contraction because spending is removed from the economy.
Of course, last I read, the Keynesian 'C+I+G' equation still obtained, meaning that if government spending is decreased, then that money can be used by consumers to either spend, or save, in which case it can be used for investment.
Just because government doesn't spend money doesn't mean it disappears. Granted, deficit spending is spending that may not occur otherwise. But, then, perhaps it shouldn't.
But it's noteworthy that Quick and her ilk no longer recognize freeing up government spending for other uses as legitimate or appropriate but, rather, risky. So much for investing for growth. Instead, these media Keynesians are for more government spending now and forever, but calling it investment. That way, cutting it will seem bad- either because demand is lessened, or, heaven forbid, government investment in key technologies and projects has been eliminated.
They no longer see any room for non-government economic activity.
He and the co-anchors were discussing the very subject of my post- the debt limit talks.
Armey had just finished explaining why taxes should not be raised and spending should be cut when network co-anchor and liberal Becky Quick began to cut in with,
".....but if spending is cut then the economy will....."
Her remark's end was lost amidst Armey's continuing comments and her realization that her words weren't getting any attention.
But notice what Quick's baseline hypothesis is. The elevated levels of federal spending under Wonderboy, up to 24% of GDP, are now to be considered sacrosanct by such liberal apologists as CNBC's liberal anchors.
Any attempt to cut the bloated spending is criticized as what Quick was trying to say- causing economic contraction because spending is removed from the economy.
Of course, last I read, the Keynesian 'C+I+G' equation still obtained, meaning that if government spending is decreased, then that money can be used by consumers to either spend, or save, in which case it can be used for investment.
Just because government doesn't spend money doesn't mean it disappears. Granted, deficit spending is spending that may not occur otherwise. But, then, perhaps it shouldn't.
But it's noteworthy that Quick and her ilk no longer recognize freeing up government spending for other uses as legitimate or appropriate but, rather, risky. So much for investing for growth. Instead, these media Keynesians are for more government spending now and forever, but calling it investment. That way, cutting it will seem bad- either because demand is lessened, or, heaven forbid, government investment in key technologies and projects has been eliminated.
They no longer see any room for non-government economic activity.
Monday, July 11, 2011
The Debt Limit Talks- Again
Following on this recent post about the debt limit talks, I'm pleased to have awoken this morning to news that the so-called 'grand bargain' is off the table.
Fortunately, as a recent lead staff editorial in the Wall Street Journal hoped, Boehner wisely rejected the 'give something now for nothing later' tactic that Wonderboy was trying to lure him into accepting.
Democrats really don't seem to accept that people behave according to changes in taxes and regulations, as I wrote here in the prior linked post,
"What nonsense! That seems to be where Democrats show their innate stupidity. They treat tax rates arithmetically, never seeming to comprehend that you get less activity of what you tax. That consumers and producers respond to minimize taxes paid, which is why the long run average is 18% of GDP."
I'm beginning to believe that, with the end of the cold war and the dissolution of the Soviet Union, the Democratic party has stepped in to take the place of the USSR in trying to destroy the United States.
Certainly, the Dems have eagerly embraced the old Soviet Union's habit of assuming what they have is theirs, then negotiating to take what is the other party's. In this case, Wonderboy assumes taxes should rise to punish those who've succeeded financially, while offering phantom, future spending cuts.
Why, with decades of evidence demonstrating that tax revenues simply do not rise above 18% of GDP, would any sane, intelligent, informed federal official believe that raising tax rates and creating new taxes will do anything but drive more job- and investment-killing, tax-avoiding behavior?
Let's hope that we get, instead, small-ball along the lines of what John Taylor wrote recently in the Journal. Something like a $2-3T spending cut deal for raising the debt limit now by slightly less, then return to the topic after November, 2012.
Fortunately, as a recent lead staff editorial in the Wall Street Journal hoped, Boehner wisely rejected the 'give something now for nothing later' tactic that Wonderboy was trying to lure him into accepting.
Democrats really don't seem to accept that people behave according to changes in taxes and regulations, as I wrote here in the prior linked post,
"What nonsense! That seems to be where Democrats show their innate stupidity. They treat tax rates arithmetically, never seeming to comprehend that you get less activity of what you tax. That consumers and producers respond to minimize taxes paid, which is why the long run average is 18% of GDP."
I'm beginning to believe that, with the end of the cold war and the dissolution of the Soviet Union, the Democratic party has stepped in to take the place of the USSR in trying to destroy the United States.
Certainly, the Dems have eagerly embraced the old Soviet Union's habit of assuming what they have is theirs, then negotiating to take what is the other party's. In this case, Wonderboy assumes taxes should rise to punish those who've succeeded financially, while offering phantom, future spending cuts.
Why, with decades of evidence demonstrating that tax revenues simply do not rise above 18% of GDP, would any sane, intelligent, informed federal official believe that raising tax rates and creating new taxes will do anything but drive more job- and investment-killing, tax-avoiding behavior?
Let's hope that we get, instead, small-ball along the lines of what John Taylor wrote recently in the Journal. Something like a $2-3T spending cut deal for raising the debt limit now by slightly less, then return to the topic after November, 2012.
Friday, July 8, 2011
The Debt Limit Talks Accelerate
Only two days ago I wrote this post regarding the debt limit talks between Congress and Wonderboy. Since then, he's held yet another press conference after an emergency Thursday morning session, declaring that progress is being made. But he also lashed out at Republicans once again, claiming they were trying to steal money from seniors via Medicare and Social Security to give to wealthy Americans in the form of tax breaks for private jets and the like.
The guy doesn't know when to shut up, does he? Would you negotiate in good faith with a guy who demonized you in public?
Neither would I.
Still, Boehner had claimed that he was optimistic a deal will be made which he can sell to his members, including those who won't vote for tax increases. The new language being used regarding taxes is 'no net revenue increases.'
Sounds like a fig leaf for somebody. Either tax rates and items taxed increase, or they don't. Then people will behave accordingly and the federal government will still collect no more than about 18% of GDP.
I'm so sick and tired of listening to Bloomberg's liberal political retread, the wizened, not-too-bright Al Hunt, and CNBC's "Red" John Harwood telling viewers that taxes just have to be raised because you can't cut spending enough to eliminate deficits.
What nonsense! That seems to be where Democrats show their innate stupidity. They treat tax rates arithmetically, never seeming to comprehend that you get less activity of what you tax. That consumers and producers respond to minimize taxes paid, which is why the long run average is 18% of GDP.
This morning's unemployment news has apparently affected the talks. Boehner has now said no deal is in sight, while June's monthly jobs were a horrifyingly small 18,000 and the unemployment rate is now up to 9.2%.
Wonderboy's labor secretary was on Bloomberg this morning blaming Bush and calling for even more "infrastructure stimulus" spending. The woman just has no clue.
Personally, I was not happy at the thought of a last-minute, desperate grand bargain on the tax code, spending cuts and the debt limit. Too much badly-designed legislation too quickly, all to satisfy a megalomanical president with no real legislative or governing experience.
Oddly, I'm feeling less worried now that Boehner issued his statement that no deal is now imminent.
Allegedly, there's supposed to be another meeting between Congressional leaders and Wonderboy on Sunday.
Stay tuned....
The guy doesn't know when to shut up, does he? Would you negotiate in good faith with a guy who demonized you in public?
Neither would I.
Still, Boehner had claimed that he was optimistic a deal will be made which he can sell to his members, including those who won't vote for tax increases. The new language being used regarding taxes is 'no net revenue increases.'
Sounds like a fig leaf for somebody. Either tax rates and items taxed increase, or they don't. Then people will behave accordingly and the federal government will still collect no more than about 18% of GDP.
I'm so sick and tired of listening to Bloomberg's liberal political retread, the wizened, not-too-bright Al Hunt, and CNBC's "Red" John Harwood telling viewers that taxes just have to be raised because you can't cut spending enough to eliminate deficits.
What nonsense! That seems to be where Democrats show their innate stupidity. They treat tax rates arithmetically, never seeming to comprehend that you get less activity of what you tax. That consumers and producers respond to minimize taxes paid, which is why the long run average is 18% of GDP.
This morning's unemployment news has apparently affected the talks. Boehner has now said no deal is in sight, while June's monthly jobs were a horrifyingly small 18,000 and the unemployment rate is now up to 9.2%.
Wonderboy's labor secretary was on Bloomberg this morning blaming Bush and calling for even more "infrastructure stimulus" spending. The woman just has no clue.
Personally, I was not happy at the thought of a last-minute, desperate grand bargain on the tax code, spending cuts and the debt limit. Too much badly-designed legislation too quickly, all to satisfy a megalomanical president with no real legislative or governing experience.
Oddly, I'm feeling less worried now that Boehner issued his statement that no deal is now imminent.
Allegedly, there's supposed to be another meeting between Congressional leaders and Wonderboy on Sunday.
Stay tuned....
Wednesday, July 6, 2011
More Debt Limit Propaganda from Wonderboy
Following on this recent post, and this one, regarding the summer's main political drama, the US debt limit, it seems timely to write about it again.
After one press conference and an address yesterday afternoon that I skipped, Wonderboy has attempted to cast the issue as GOP Congressional members refusing to raise taxes on the rich.
However, yesterday morning on CNBC, I saw/heard Senator Pat Toomey (R-PA) correctly frame it this way. To paraphrase, he said,
'I've got a list of spending cuts in mind. The Democrats have a list. Compromise would be to agree on some mix of the two lists. Not to suddenly add raising taxes to the discussion. That's not compromise.'
It's a fair point. Further, the responsibility for this mess is Wonderboy's. He's the president. It's his job to get Congress to vote on things he wants, or to get them to vote on what works.
The GOP has an argument which I haven't yet heard them use. To wit, the First Rookie won election almost three years ago, then wasted over a trillion dollars on useless so-called 'stimulus' spending, while ramming through trillions more in longer term spending under the guise of nationalized health care.
The GOP House majority was elected less than a year ago, as were its new Senators. They are the product of voters' more current concerns with spending and size of federal government.
If you go through the recent history of House and Senate votes on various budgets, you'll see that even Democrats in Congress no longer will vote for higher spending or higher taxes, straight up. They know those are not issues on which they'll be re-elected for supporting.
If the president wants to reform the tax code, that's great! The GOP should certainly sit at that table. But as Toomey points out, that's not the same table as the spending-cut table at which the debt limit is being discussed.
It's a testament to Wonderboy's lack of governing or legislative experience that he's decrying smaller total spending cuts which could be achieved to pass a debt limit increase, in favor of some larger targets which are unlikely to be met if they require tax increases or a massive tax code rewrite.
After one press conference and an address yesterday afternoon that I skipped, Wonderboy has attempted to cast the issue as GOP Congressional members refusing to raise taxes on the rich.
However, yesterday morning on CNBC, I saw/heard Senator Pat Toomey (R-PA) correctly frame it this way. To paraphrase, he said,
'I've got a list of spending cuts in mind. The Democrats have a list. Compromise would be to agree on some mix of the two lists. Not to suddenly add raising taxes to the discussion. That's not compromise.'
It's a fair point. Further, the responsibility for this mess is Wonderboy's. He's the president. It's his job to get Congress to vote on things he wants, or to get them to vote on what works.
The GOP has an argument which I haven't yet heard them use. To wit, the First Rookie won election almost three years ago, then wasted over a trillion dollars on useless so-called 'stimulus' spending, while ramming through trillions more in longer term spending under the guise of nationalized health care.
The GOP House majority was elected less than a year ago, as were its new Senators. They are the product of voters' more current concerns with spending and size of federal government.
If you go through the recent history of House and Senate votes on various budgets, you'll see that even Democrats in Congress no longer will vote for higher spending or higher taxes, straight up. They know those are not issues on which they'll be re-elected for supporting.
If the president wants to reform the tax code, that's great! The GOP should certainly sit at that table. But as Toomey points out, that's not the same table as the spending-cut table at which the debt limit is being discussed.
It's a testament to Wonderboy's lack of governing or legislative experience that he's decrying smaller total spending cuts which could be achieved to pass a debt limit increase, in favor of some larger targets which are unlikely to be met if they require tax increases or a massive tax code rewrite.
Monday, July 4, 2011
Is Mark Halperin Right? Is Obama a D**k?
MSNBC suspended Mark Halperin from whatever his role is at the network for replying to Joe Scarborough that Wonderboy was "a d**k" for his remarks regarding the debt limit at his recent press conference.
I must agree with Halperin. Forget his apologies and various backtracking- he was right the first time.
If you saw the First Rookie's act last week, then you know that he lashed out irresponsibly, as usual, at selected targets. Republicans in Congress were blamed for Wonderboy's own party's running up more than a trillion dollars of debt in the past two years. Corporate executives using private aircraft to improve productivity of their employees were scourged for presumed luxury consumption of air travel.
Never one to take responsibility for, well, anything, Obama simply blamed everyone else for any fiscal problems in his administration.
Deficits ballooning? Raise taxes on the rich or those who use things that make them look rich.
By the way, those private aircraft enable businesses to better-manage their operations. And those aircraft provide jobs in manufacture and servicing. Even the machinists' union criticized Wonderboy's thoughtless remarks about those private aircraft.
Spending too high? Demagogue about cutting payments to seniors while so-called 'tax cuts for billionaires' were signed into law last year by.....aah.....him.
Yes, he's a d**k alright. He's not interested in governing America to make it better. He's only interested in advancing his liberal agenda of fiscally wrecking the country while he attempts to remain personally well-liked.
I must agree with Halperin. Forget his apologies and various backtracking- he was right the first time.
If you saw the First Rookie's act last week, then you know that he lashed out irresponsibly, as usual, at selected targets. Republicans in Congress were blamed for Wonderboy's own party's running up more than a trillion dollars of debt in the past two years. Corporate executives using private aircraft to improve productivity of their employees were scourged for presumed luxury consumption of air travel.
Never one to take responsibility for, well, anything, Obama simply blamed everyone else for any fiscal problems in his administration.
Deficits ballooning? Raise taxes on the rich or those who use things that make them look rich.
By the way, those private aircraft enable businesses to better-manage their operations. And those aircraft provide jobs in manufacture and servicing. Even the machinists' union criticized Wonderboy's thoughtless remarks about those private aircraft.
Spending too high? Demagogue about cutting payments to seniors while so-called 'tax cuts for billionaires' were signed into law last year by.....aah.....him.
Yes, he's a d**k alright. He's not interested in governing America to make it better. He's only interested in advancing his liberal agenda of fiscally wrecking the country while he attempts to remain personally well-liked.
Tuesday, June 28, 2011
The Debt Limit Talks
For me, the best line of the entire debt limit situation came last week when former Senator, now presidential candidate Rick Santorum, replied to a question from Glenn Beck about the Biden-led talks, to paraphrase,
'If Joe Biden's involved, then you know they're going to fail.'
I notice that all of the CNBC coverage involves earnest-sounding liberal Democrats claiming,
'There has to be compromise. Sure, we'll cut spending. But the Republicans refuse to raise revenues. They have to agree to more taxes- it's only fair.'
Really?
How about this- the Democrats and Republicans have been spending far above the long-term federal tax/GDP rate of 18% for decades. No matter what the tax rates, only about 18% of GDP will find its way to federal coffers.
The only real issue now remaining, as global investors begin to doubt America's government's ability to ever live within its means, is to cut spending.
Wasting time on tax hikes or new taxes will only distort and affect consumer behavior to once more lower tax collections to 18% of GDP.
Democrats don't seem to be able, or want to, acknowledge that tax policy is not arithmetic in a static environment, but government policy which provokes changes in consumer and investor behaviors which lower tax collections back to a surprisingly stable long-term rate of 18% of GDP.
Are the Congressional Democrats- and Wonderboy- really so blind and stupid as to not understand this?
I think some are, and the others are simply choosing not to acknowledge, hoping to just keep raising taxes at every opportunity. The liberal mainstream media backs this play by pretending that 'it's only fair' to raise taxes if spending is being cut, ignoring decades of spending excess by both parties. It's a very Russian negotiating tactic- what's yours is on the table, but what's mine is not, ergo, grudgingly giving way on spending cuts, but only if taxes are raised.
Personally, I am at the point where I am okay with no debt limit raise if the Democrats don't agree to spending cuts in excess of the raise within the next year or two.
Economist John B. Taylor offered an excellent compromise solution on Tom Keene's noontime Bloomberg program yesterday. Taylor suggested that Republicans extract half of the $6-7T in required spending cuts this time around, then go for the remaining $3T next year, with no tax hikes ever mentioned.
Sounds good to me.
'If Joe Biden's involved, then you know they're going to fail.'
I notice that all of the CNBC coverage involves earnest-sounding liberal Democrats claiming,
'There has to be compromise. Sure, we'll cut spending. But the Republicans refuse to raise revenues. They have to agree to more taxes- it's only fair.'
Really?
How about this- the Democrats and Republicans have been spending far above the long-term federal tax/GDP rate of 18% for decades. No matter what the tax rates, only about 18% of GDP will find its way to federal coffers.
The only real issue now remaining, as global investors begin to doubt America's government's ability to ever live within its means, is to cut spending.
Wasting time on tax hikes or new taxes will only distort and affect consumer behavior to once more lower tax collections to 18% of GDP.
Democrats don't seem to be able, or want to, acknowledge that tax policy is not arithmetic in a static environment, but government policy which provokes changes in consumer and investor behaviors which lower tax collections back to a surprisingly stable long-term rate of 18% of GDP.
Are the Congressional Democrats- and Wonderboy- really so blind and stupid as to not understand this?
I think some are, and the others are simply choosing not to acknowledge, hoping to just keep raising taxes at every opportunity. The liberal mainstream media backs this play by pretending that 'it's only fair' to raise taxes if spending is being cut, ignoring decades of spending excess by both parties. It's a very Russian negotiating tactic- what's yours is on the table, but what's mine is not, ergo, grudgingly giving way on spending cuts, but only if taxes are raised.
Personally, I am at the point where I am okay with no debt limit raise if the Democrats don't agree to spending cuts in excess of the raise within the next year or two.
Economist John B. Taylor offered an excellent compromise solution on Tom Keene's noontime Bloomberg program yesterday. Taylor suggested that Republicans extract half of the $6-7T in required spending cuts this time around, then go for the remaining $3T next year, with no tax hikes ever mentioned.
Sounds good to me.
Monday, April 4, 2011
Marco Rubio On The Debt Ceiling
Florida's newly-elected Senator, Marco Rubio, wrote an editorial in last Wednesday's Wall Street Journal explaining Why (He) Won't Vote to Raise the Debt Limit.
There's been a lot of ink spilled by the left on this issue. As I wrote this post on Friday morning, CNBC's political reporter, 'Red' John Harwood, breathlessly explained, after a clip of Indiana Republican Representative Mike Pence, that it looked like the Tea Party-controlled GOP legislators were going to shut down the federal government and imperil the country's credit rating, the economy, peace on earth, etc. In short, the world balances on whether some GOP members of Congress hold fast to demand Democratic agreement to some reasonable spending cuts of only tens of billions, for now.
Treasury Secretary Geithner has been proclaiming that not raising the debt ceiling means defaulting on US obligations, which, of course, is simply untrue. If Tim really believes that, then he's just not smart enough to hold his cabinet position.
Wonderboy's folks even corralled banking crony Jamie Dimon, CEO of Chase, to declare that it was just crazy talk not to raise the debt limit. Good ol' Jamie. Give him a few regulatory breaks and let him visit the Oval office, and he's good for whatever propaganda and scare talk you need from him.
Fact is, though, Rubio and his colleagues who are against raising the debt limit are, I believe, correct this time.
As Rubio notes in his Journal piece, Wonderboy and the Democrats are offering a 2012 budget with a ten-year spending level of $46 trillion. You'd think in this time of serious deficits and excessive spending, the federal government could manage a balanced budget for 2012? No, it can't even do that.
This is Rubio's point. There's no seriousness on the part of Democrats to do anything about spending. They won't discuss any significant cuts. Rubio wrote,
"....instead of simply raising the debt limit, we should reassure job creators by setting a firm statutory cap on our public debt-to-GDP ratio.
Some say we will go into default if we don't increase the debt limit. But if we simply raise it once again, without a real plan to bring spending under control and get our economy growing, America faces the very real danger of a catastrophic economic crisis."
He also notes that in 2006, Senator Wonderboy voted against raising the debt limit to $8.965 trillion, saying at the time,
"Raising America's debt limit is a sign of leadership failure."
Hmm. What's that saying about goose...gander.....well, you get the point.
Having attended a couple of Tea Party events in the past two years, I'm not encouraged by the GOP rolling over on this one. I don't think anyone wants a government shutdown. But if our Congressional branch can't direct Treasury in how to prioritize payments while getting spending reduced in order to either meet the debt limit or credibly nudge it up temporarily, then we're lost on a much larger scale than simply the debt limit.
I guess we'll all see how this develops later this week, won't we?
There's been a lot of ink spilled by the left on this issue. As I wrote this post on Friday morning, CNBC's political reporter, 'Red' John Harwood, breathlessly explained, after a clip of Indiana Republican Representative Mike Pence, that it looked like the Tea Party-controlled GOP legislators were going to shut down the federal government and imperil the country's credit rating, the economy, peace on earth, etc. In short, the world balances on whether some GOP members of Congress hold fast to demand Democratic agreement to some reasonable spending cuts of only tens of billions, for now.
Treasury Secretary Geithner has been proclaiming that not raising the debt ceiling means defaulting on US obligations, which, of course, is simply untrue. If Tim really believes that, then he's just not smart enough to hold his cabinet position.
Wonderboy's folks even corralled banking crony Jamie Dimon, CEO of Chase, to declare that it was just crazy talk not to raise the debt limit. Good ol' Jamie. Give him a few regulatory breaks and let him visit the Oval office, and he's good for whatever propaganda and scare talk you need from him.
Fact is, though, Rubio and his colleagues who are against raising the debt limit are, I believe, correct this time.
As Rubio notes in his Journal piece, Wonderboy and the Democrats are offering a 2012 budget with a ten-year spending level of $46 trillion. You'd think in this time of serious deficits and excessive spending, the federal government could manage a balanced budget for 2012? No, it can't even do that.
This is Rubio's point. There's no seriousness on the part of Democrats to do anything about spending. They won't discuss any significant cuts. Rubio wrote,
"....instead of simply raising the debt limit, we should reassure job creators by setting a firm statutory cap on our public debt-to-GDP ratio.
Some say we will go into default if we don't increase the debt limit. But if we simply raise it once again, without a real plan to bring spending under control and get our economy growing, America faces the very real danger of a catastrophic economic crisis."
He also notes that in 2006, Senator Wonderboy voted against raising the debt limit to $8.965 trillion, saying at the time,
"Raising America's debt limit is a sign of leadership failure."
Hmm. What's that saying about goose...gander.....well, you get the point.
Having attended a couple of Tea Party events in the past two years, I'm not encouraged by the GOP rolling over on this one. I don't think anyone wants a government shutdown. But if our Congressional branch can't direct Treasury in how to prioritize payments while getting spending reduced in order to either meet the debt limit or credibly nudge it up temporarily, then we're lost on a much larger scale than simply the debt limit.
I guess we'll all see how this develops later this week, won't we?
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