Sequester? I’ll Take Two, or Three, or …

February 20, 2013

If the automatic budget cuts set in motion back in 2011 – known as the “sequester” – go into effect soon, as will be the case without Congressional action, people will die. At least that is if the level of rhetoric to which President Obama has now lowered himself to bears any actual resemblance to reality. (Let us leave out for now that politics seldom ever really bears any resemblance to reality to begin with.)

Speaking in front of cameras Tuesday – and flanked by uniformed first responders otherwise known to political cynics as ‘prop people’ often used for emotional, rather than rationale, appeals – Obama warned of the following (abbreviated to prevent potential reader nausea):

“Emergency responders … their ability to help communities respond to and recover from disasters will be degraded… FBI agents will be furloughed. Federal prosecutors will have to close cases and let criminals go… Hundreds of thousands of Americans will lose access to primary care and preventive care like flu vaccinations and cancer screenings.”

Who, according to Obama, will be to blame for these supposedly outrageous “meat-clever”-type cuts? The usual suspects: “Congress.” Or what he really means: Those evil, rich-loving Republicans who only cater to ‘special interests.’  Never mind the minor detail that the sequester was actually the Obama administration’s idea. In fact, Obama was at one point adamant against backtracking on it. In November of 2011, he warned, “I will veto any effort to get rid of those automatic spending cuts – domestic and defense spending.” He added, “There will be no easy off-ramps on this one.”

obama_1st-responders-sequester

But don’t sweat the details, right? Political rhetoric is much more preferred in situations like this. And none is more preferred than the rhetoric that claims this sequester actually represents ‘cuts’ – and the “meat-cleaver” kind at that! Unfortunately, in ‘Washington-speak,’ most references to ‘cuts’ are really just slow-downs in the rate of projected growth. Assuming the sequester takes place, the federal budget will actually still grow by $2.4 trillion over the next 10 years. Translation: We’re still going to spend more, just not as much as we had originally planned. Similar to as if an employee were to get a slightly smaller raise instead of larger raise, only employers usually actually have that money to spare for the slightly smaller raise.

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Some Perspective on the Debt

February 17, 2012

A parody that might bring the enormity of the national debt a little closer to home:


Downgrade

August 5, 2011

It’s official. Ratings agency Standard & Poor’s has downgraded their long-term credit rating for the U.S., noting in their report the following reasons:

… we believe that the prolonged controversy over raising the statutory debt ceiling and the related fiscal policy debate indicate that further near-term progress containing the growth in public spending, especially on entitlements, or on reaching an agreement on raising revenues is less likely than we previously assumed and will remain a contentious and fitful process. We also believe that the fiscal consolidation plan that Congress and the Administration agreed to this week falls short of the amount that we believe is necessary to stabilize the general government debt burden by the middle of the decade.

Hard to argue with.  Even the party dubbed as deficit hawks, Republicans, have voiced skittishness over the possibility of defense spending cuts should the plan potentially emanating from the so-called “super” committee not pass.

The sad reality is that very few politicians are willing to make the cuts that are necessary to correct our ever-increasing path toward staggering debt (not that we aren’t already there). And if they’re not willing to make those cuts, the only other option is to “increase revenues,” which is code for raising taxes – something that is even less politically palatable. Yet even raising taxes on the “rich” isn’t enough to put the government in the black.

It’s easy to point the finger at our politicians. But they are just doing what they think will get them reelected, which means in most cases avoiding making tough decisions that might offend their constituents. Truth be told, it’s the electorate that is to blame for our mounting debt and near refusal to seriously deal with it (note: part of the S&P reasoning was that the amounts agreed on in the recent debt-ceiling deal are not anywhere near enough to tackle our long-term debt problems). As long as we the voters are unwilling to give up our particular piece(s) of the pie the government spending-machine cooks up, we will continue to face mounting debt and further credit worries.

“But what about cutting waste, fraud and abuse?” you might ask. One man’s “waste” is another man’s “investment.” One man’s “fraud” is another man’s “tax credit.” And one man’s “abuse” is another man’s “grant” or “entitlement” or whatever other euphemism he may choose at any given moment to justify his looting of other people’s money.

We are all part of the problem. The sooner we realize that the better.


Planned Parenthood and Grown-up Budgeting

April 9, 2011

Much debate took place around government funding to Planned Parenthood leading up to the prevented government “shutdown.” Many pro-lifers argued funding was going directly to fund abortions. Pro-choicers argued the federal money was separated from the money going to abortions. And budget hawks and libertarians argued government shouldn’t be subsidizing any of their services, regardless of the abortion issue.

Here are a few facts on the issue straight from Planned Parenthood itself:

  • Percent of Planned Parenthood revenue from government funding (FY 2008/2009) = 33% [source]
  • Abortion as percentage of all Planned Parenthood services (FY 2008/2009) = 3% [source]
  • Number of abortions performed by Planned Parenthood every hour (2009) = 38 [source]

In short, some of the figures thrown around have been exaggerated while others not raised should be a little disturbing. However, two points should be raised.

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We Cannot Afford More Toys

November 17, 2010

Watching the fallout from both sides on the release by the co-chairs of President Obama’s Deficit Commission of a draft proposal is a bit like watching young kids pouting in a toy store when their parents tell them that they cannot get all the toys they want because their parents lack all the money to pay for them. The left doesn’t want cuts in entitlements. The right doesn’t want to cut defense spending.

If we are ever going to solve our debt problem, or at least make a dent in it, we will have to grow up. The few grown-ups in this situation have to take the lead. But fiscal maturity is not an attribute many voters or politicians have often displayed.

It’s always easier to delay the sacrifice associated with fiscal responsibility. But, in the end, failing to grow up will have dire consequences.


Bailing Out the States

August 10, 2010

Are you from a state that just can’t seem to pay its bills? Never fear, President Obama and the U.S. Congress are coming to your rescue.

Congress recently passed, and Obama recently signed, a bill that will effectively bailout states with an additional $26 billion the federal government doesn’t actually have. Though it is argued that the bill would be paid for in the future with increased taxes, withdrawing funding from a loan program and suggested cuts in food stamps — not to take place until 2014 — some lawmakers, including House Speaker Nancy Pelosi, have voiced opposition to such methods of payment. In addition, one provision in the bill reportedly mandates that one state, Texas, maintain its current levels of education spending through 2013.

Obama emotionally appealed to the moral sensibilities of Americans when he argued the following:

We can’t stand by and do nothing while pink slips are given to the men and women who educate our children or keep our communities safe.

Which children and communities is he referring to? What the bailout amounts to is taxpayers from one state paying to bailout another state. I believe the phrase is, “Robbing Peter to pay Paul.”

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France Tackles Retirement Age

June 22, 2010

The government in France is actually making a sensible move to improve their finances. They’re targeting their pension system by raising the retirement age to 62.

Naturally, the socialists and unions are decrying the move. But, fortunately for the financial strength of that country, more sane minds have apparently prevailed.

Now, if only the United States could learn from this move and, barring real and comprehensive reform, at least seek to raise the Social Security retirement age. But that’s not likely given the outcry politicians would likely here.

Meanwhile, our country’s fiscal health continues to be threatened by our bloated entitlement programs.