Arizona v. United States Debate

Some Retiring Democrats who were for ObamaCare are now against it

 =  

Retiring Senator Webb and Retiring Congressmen Frank and Miller both have different thoughts now on the Obama Care issue, but why did they not express these views when they were creating the bill and voting on it?  

Retiring Senator Webb and Retiring Congressmen Frank and Miller both have different thoughts now on the Obama Care issue, but why did they not express these views when they were creating the bill and voting on it?

Recently some democratic members of congress expressed their views on the  health care debate in light of the recent possibility that the ObamaCare may be ruled unconstitutional by the US Supreme Court.

An excerpt from  The Hill article, OVERNIGHT HEALTH: More retiring Dems pile on Obama for healthcare focus, looks at certain members of congress from the democratic  party who say that the ObamaCare bill came at a not so opportune time in our economic crisis.

Rep. Barney Frank (D-Mass.) isn’t the only retiring House Democrat who thinks the White House made a big mistake by pursuing healthcare reform. In interviews with The Hill on Thursday, several more Democrats piled on, saying Obama hurt Democrats’ electoral chances.

“I think we would all have been better off — President Obama politically, Democrats in Congress politically, and the nation would have been better off — if we had dealt first with the financial system and the other related economic issues and then come back to healthcare,” said Rep. Brad Miller (D-N.C.), who is retiring at the end of this Congress. 

Miller voted for the healthcare bill — as did Frank and Sen. Jim Webb (D-Va.), who reopened the inter-party dispute earlier this week. 

Rep. Dennis Cardoza (D-Calif.) also criticized his party’s handling of the issue, saying the bill should have been done “in digestible pieces that the American public could understand and that we could implement.”

Even some in the democratic party feel that the President Obama and his then democratically controlled congress should have tackled the economic issues, debt issues, and budget issues first before apply more pressure to the budget and cause more spending by making bills such as ObamaCare and the stimulus package, both of whom have had little to no effect so far in our economy.

The Buffett Rule: A Gimmick?

In a recent article I came across, “Buffett Rule is politics over policy”, the author argues that the Buffett Rule looks to be successful in theory where the rich pay more taxes so that we may solve our fiscal problems in the United States but in actuality, the author states that:

Will the president’s tax hike at least tackle our fiscal problems? No. According to a recent analysis by the congressional Joint Committee on Taxation, the Buffett Rule would raise a mere $47 billion over 10 years, or 0.5 percent of the president’s new spending. Soaking the rich cannot get deficits down; only spending reductions can do that.

His republican views challenge any other view, and he argues that the only reason he is pushing for this plan is so that he can, “makes for great populist rhetoric but terrible policy. Worse, it’s a distraction from the big issues facing the nation, such as the deficit, the economy, jobs, gas prices, and health care.”

According to the Author:

The Buffett Rule would only weaken the economy and employment. It would fall most heavily on job creators and confiscate resources that would otherwise be used to start new businesses, expand existing businesses, and hire more workers.

The president has said “this is about giving everybody the chance to do well.” Really? Raising taxes on anybody somehow gives everybody the chance to do well? This is absurd even by the low standards of American political rhetoric.

Under the Buffett Rule, businesses and families earning $1 million will pay a minimum 30 percent effective tax rate. The president says those Americans aren’t paying enough. As proof, he points to billionaire Warren Buffett’s secretary, who reportedly pays a higher tax rate than her uber-wealthy boss. But he’s distorting the facts.

Many wealthy Americans receive dividends and capital gains, investment income that is subject to multiple levels of taxes. First, the investment income results from investment. This capital didn’t appear out of thin air. It was earned and taxed previously. Once invested, it generates income that is taxed at the corporate rate, 35 percent. And then it’s taxed again at the individual level for dividends and capital gains, 15 percent.

Imagine you’re driving down a toll road, and you pay three separate tolls. The first toll of $3.50 is when you get on the highway. Then, after a few miles, you pay another $3.50. And when you exit, there’s a final toll of $1.50. A reporter asks as you leave the last tollbooth how much you paid.

Now I agree with him that raising the capital gains tax is a bad idea because not only does it attack big business, but it also attacks the small business owner, who may hypothetically have a investment business or his business and income is solely based on dividends from investments.

So I do not agree with the Buffett Bill, though I admire Warren Buffett and the accomplishments he has had I do not agree with the tax policy he is advising to the president so that the American tax system would be more even.

Cost of War

In a recent article written in The Washington Post, Too Many Wars, Too Few U.S. Soliders, it talks about the costs of war and how War is now become a problem for society as many service members who come back from war are devastated by the effects of war.  I submit that war is not a bad thing but a last resort.  We should not go to war unless we have exhausted all diplomatic measures, as War’s cost money, resources and human capital. 

The Wars in Iraq and in Afghanistan have put a cost on our nation and put a big price tag on our nation budget, in a recent study done by Brown University it seems that all the wars we have participated in last decade comes about to be about 5 Trillion US Dollars that has been syphoned out of our budget to fund wars on foreign soil.  Now I am all for the liberation of freedom from dictators and our militaries and foreign policy maker’s mission to bring democracy anywhere across the globe.  But I feel that there are other ways to go about that mission, mainly through diplomacy where we would not to spend trillions of dollars in a war that not only do Americans not benefit from war.  We feel as though money and are hard earned wealth is being taken by our government to be used to fund a war is not something Americans like to know.  So in the end though the US government gets a kick out of going to war to liberate that country and make and ally, the people back at home in America are paying for the bill and the costs of war.

In times of war not only do we use money to fund the war we take good natural resources from America like food and oil from America and bring it abroad to be used in the service of democracy.  Now come on, I don’t believe that for a second I believe that using our resources is particularly necessary I feel that we are just wasting time and energy on something that is not helping the American people in general.  And to take our resources and give them to a foreign nation to be used to help them liberate and become democratic is something that makes me laugh as I feel that war again is a last resort and we should not commit our resources to fight another countries war.

In the past decade we have been to two wars that has lasted most if not all of the decade, and that has taken a toll on Americans both around the nation and abroad, where service members go each day into the battlefield to give their lives to this beloved country of ours.  Members of our armed services come back from war with many conditions such as depression, PTSD, and nightmares from war.  These really affect the human capital in America as many young Americans sign up and go to war in the service of our nation, only to come back impaired in a certain way. They do not come back the same as when they left, going to war I feel that people who go to war always leave a little bit of themselves behind in the battlefield.  SO that they could forget the horrible incident and go on and live normal happy lives as best as they can.  Why should we sacrifice the sanity and the liveliness of our future generations to war. I believe that it is not necessary to do so and that we as a nation should do something to stop wars from happening in the future.

So War, it challenges America both monetarily, resource wise and psychologically; we have to give up a lot during times of war.  We see many sacrifices being taken among those who are not in government.  While the government sits in their ‘Ivory Tower’ deciding that was is best for its allies is to support them and to go to war, I believe that they do not look at the people at home who are the ones who sacrifice for war.  I feel that war is a last resort, a tool that should be used when there are no other alternatives; and that wars should be quick and concise so that we do not spend decades into a war that drains the moral of a country.

The House approves $3.5 trillion Budget Plan

A Few days ago I came across an article that discussed the new budget that has just pass a house vote.   In the very divided congress we currently have today in our government, the republican controlled House of Representatives passed a there version of next year’s bill, in which voting was heavily based on party lines.  The new budget for next year was introduced by congressman Paul Ryan (R-Wis.1st) would equate to about $3.5 trillion dollars in spending.

In congressman Ryan’s bill he proposes:

The Ryan plan, which proposes cutting tax rates and a dramatic revamping of Medicare to curb costs for future retirees, faces all but certain rejection in the Senate but will frame the parties’ election-year debate on fiscal issues. The plan cuts $5.3 trillion over the next decade — entirely through deep cuts in entitlements and agency spending.

And as the voting breakdown as you are all aware were based on party lines with some republicans voting against the proposed budget:

The House vote breakdown was 228 Republicans in favor, and 181 Democrats and 10 Republicans opposed.

After the vote, Republicans ground out press releases praising the vote for proposing “real solutions” to improve the economy. Democrats responded with a round of statements decrying the GOP effort to revamp Medicare.

Overall, I still believe that the budget is too high and that we should cut back, and I believe I will continue to feel this way until I see that our government is safe and secure in terms of our budget.  But I like the steps that the government is taking to lower our current budget deficit, so that our future generations may have a chance to have a government without debt.

Is Going to War with Iran a Good Idea?

 

The Islamic Republic of Iran’s Nuclear Program has been the subject of heated debate in not only American politics but even global international politics.  While we here at home have started with economic sanctions towards Iran’s economy,  other nations in the international community have called for combative measures to suppress Iran from becoming a new up and coming nuclear power.  I agree that we should stop nuclear proliferation and should at all costs stop the Iranian government from pursing nuclear weapons.

But we do not need to go to war over it, mainly because first we just do not have enough money to be in a two war situation, second the American people are not in favor of another war, and finally I think America priorities are wrong where we try to curry favor from everyone and we try to make everyone happy is what is causing us to run our deficit and unnecessary spending.  It is time for a change in the way we think and act and we do not need to go to war to prove that America is a great power or try to make everyone happy in order to make our country look benevolent. In hard times we need to change our outlook in order to make a difference and change what is broken.

War is a last result when all forms of diplomacy have failed and we can no longer negotiate with the country we are in conflict with.  And I am all for supporting America to go to war with Iran, but the reality of the situation is that we as a nation do not have the necessary funds or resources to send our country into another conflict in which we will lose money to foreign nations and the lives of our American military service members who are willing to give their lives in the cause of freedom.  But if we go to war with Iran it would not be for freedom, it would be to suppress another country from becoming a nuclear power, thus going against our country’s morals and original cause to go to war with other nations.

Again, not to be repetitive but I want to drive this point across, Wars cost money and we do not have the money to wage another war with another country, and Iran is a country that can pose a formidable threat to the US war machine.   We have the weaponry, tools and personnel to go to war with Iran but do we have the moral support of the American people, if we do not how are we going to allow for our military to invade a foreign country and stop them from becoming a nuclear power when we are unable to solve our own problems at home.   We have a massive public debt, our government is so politically divided that nothing gets done in our government, and some in America feel that our constitutional rights are being restricted by our current government.  With all these issues at home do you really think we have the support, time our resources to go to war with Iran?  I do not think so.

In order for us to really go to war with the country of Iran I believe that we would need the support of the American people, but at this time the American people want our government to leave Afghanistan and get out of fighting for a while so I do not see the American people supporting a war with Iran.   We have internal problems of our own in America.  We just do not have the time, energy or effort to solve the problems of the international community any longer.   Before we can go back to becoming the great superpower again where we solve the world’s problems, we need to solve our problems first and stop the political infighting, and the massive public debts.  Then we can go back to becoming a global superpower and help police the world and solve their problems.

So at the end of the day, “WE CAN NOT GO TO WAR WITH IRAN!”, why because our country is weak, not because we are morally or physically weak, but our country is fiscally unstable, economically weak, and politically divided.  How can we wage a war, make political progress, and reinvigorate our economy when we are weak in the most important things.  We are not in the cold war anymore where we can go and attack every country we feel is oppressing others or if they are against America.  Our government needs to access what is important to average Americans and work to help them instead of solving global issues.

Why are Gas Prices so High?

Recently I can across an Baltimore Sun article called, “The Extra Dollars You’re Paying at the Pump are Going to Wall Street Speculators”, in the article it stated that the reason that gas prices are going up is that, speculators in wall street are driving up the prices, they say that this is what happened into 2008 as well.  Now I do not agree with that opinion but I do agree that the recent activity may have been caused by:

If prices at the pump continue to rise, expect the gas wars to intensify.

But the current surge in gas prices has almost nothing to do with energy policy. It doesn't even have much to do with global supply and demand. It has most to do with America's continuing failure to adequately regulate Wall Street.

Oil supplies aren't being squeezed. More than 80 percent of America's energy needs are now being satisfied by domestic supplies. In fact, we're starting to become an energy exporter.

Iran is threatening to cut production in retaliation for sanctions imposed by the European Union and the United States. But Saudi Arabia's increased production is more than enough to make up the difference.

Demand for oil isn't rising in any event. Oil demand in the U.S. is down compared to last year at this time. The American economy is showing only the faintest signs of recovery. Meanwhile, global demand is still moderate. Europe's debt crisis hasn't gone away. China's growth continues to slow.

I believe that the problem is caused by a global political crisis, and not by the some stockbrokers in Wall Street. The problem is that Americans and countries across the globe are dependent on oil and I believe that we should find alternatives to oil so that we are not dependent to other countries and drain our own oil supply thus ruining our ecosystems just to fuel our daily lives.
We were to first to create alternatives to crude oil such as E-85 ethanol, but we are now the last in the world to actually utilize this technology.  So in order for us to be a great and successful country we need to grab the opportunity when we are ahead instead of creating an idea and then let the world get ahead of us and then catch up behind everyone else.  We are the world’s only superpower I believe that it is time we acted like one.

 

 

A 21 YEAR OLDS POINT OF VIEW

I found this blog post while searching for something to write and found this very interesting.

“The problems we face today are there because the people who work

for a living are outnumbered by those who vote for a living”

This was written by a 21 yr old female who gets it. It’s her future

she’s worried about and this is how she feels about the social welfare

big government state that she’s being forced to live in! These

solutions are just common sense in her opinion.

This was in the Waco Tribune Herald, Waco , TX Nov 18, 2010

Put me in charge . . .

  TO

Put me in charge of food stamps. I’d get rid of Lone Star cards; no

cash for Ding Dongs or Ho Ho’s, just money for 50-pound bags of rice

and beans, blocks of cheese and all the powdered milk you can haul

away. If you want steak and frozen pizza, then get a job.

 AND

Put me in charge of Medicaid. The first thing I’d do is to get women

Norplant birth control implants or tubal ligations. Then, we’ll test

recipients for drugs, alcohol, and nicotine and document all tattoos

and piercings. If you want to reproduce or use drugs, alcohol, smoke

or get tats and piercings, then get a job.

 AND

Put me in charge of government housing. Ever live in a military barracks?

You will maintain our property in a clean and good state of repair.

Your “home” will be subject to inspections anytime and possessions

will be inventoried. If you want a plasma TV or Xbox 360, then get a

job and your own place.

In addition, you will either present a check stub from a job each week

or you will report to a “government” job. It may be cleaning the

roadways of trash, painting and repairing public housing, whatever we

find for you. We will sell your 22 inch rims and low profile tires and

your blasting stereo and speakers and put that money toward the

“commo

n good..”

Before you write that I’ve violated someone’s rights, realize that all

of the above is voluntary. If you want our money, accept our rules..

Before you say that this would be “demeaning” and ruin their “self

esteem,” consider that it wasn’t that long ago that taking someone

else’s money for doing absolutely nothing was demeaning and lowered

self esteem.

If we are expected to pay for other people’s mistakes w e should at

least attempt to make them learn from their bad choices. The current

system rewards them for continuing to make bad choices.

AND 

While you are on Gov’t subsistence, you no longer can VOTE! Yes

that is correct. For you to vote would be a conflict of interest. You

will voluntarily remove yourself from voting while you are receiving a

Gov’t welfare check. If you want to vote, then get a job.

I realize that this is a extreme way of trying to tackle the issue that our country is currently facing in terms of spending too much on welfare programs.

I only post this up as a comedic license to see how some hardcore conservatives view our current situation, I  in no way believe this persons words or point of view in their entirety.  I like to use this as a way of lightening the situation our country is currently facing.

If you take offense to these views, well you are entitled to your opinion; and as I said earlier this is just a comedic view on the current situation.

Is Our 'Booming' Economy Helping Our Budget Deficit?

In a recent The Hill article “Improving Economy Does Little to Help Obama Shrink the Budget Deficit” reported that in a recent jobs report the positive outlook that the report gave would help president Obama in his reelection campaign.  However, the growth was very little and it may not be enough to make a difference.

In the article they quoted Keith Hennessey, an economist highly regarded by conservatives, and wrote on his blog that “even if the current positive trend were to accelerate I would anticipate economic policy to be a (the?) central focus of the election.”

“If the economy looks good, debate will shift to the fiscal picture which is still miserable,” he wrote.

The report stated that “the economy added 227,000 jobs in February and the unemployment rate stayed at 8.3 percent.  However, the trade deficit grew and this led some forecasters to reduce their outlook for gross domestic product.”  So the growing economy is not helping the president and our government with shrink our budget deficit, which in turn means that our debt is not being scaled back. 

This is not good outlook for the future years to come, as we have a growing economy but no signs of relieving our debt and budget deficit means our government will still be in a hole where they owe others money for years to come and that is a terrible prospect for our future generations.  I believe that we in this generation should clean up the mess that our government has currently left us in and try to restructure not only our budget but the people in government who support the measures to keep us in debt.

Though the report says that:

The White House last month forecast 2.7 percent growth in 2012. Even with that high rate of growth, it estimated this year’s budget deficit to be $1.3 trillion. Even by assuming historically high growth of 4.1 percent in the middle of the decade, by Obama’s own figures his budget has $8.6 trillion in deficits over the next ten years.

The President may forecast growth in our economy, but that means nothing if our government is in a budget deficit.  That means that our government is still in the negative where we owe more than we can produce, and that is not an efficient way to run government.  I believe that needs to change, and a way to do that is to change the system and our current leaders in power and in government.  So I say we need ‘change’ to come again.

China’s Grip on the United States is Slipping?

Recently, I glanced across a Bloomberg article that discussed how China, who is currently the largest holder of US Treasury bonds and one of the main creditors to the U.S. public debt, has started to reduce their holding of US Government securities for the first time in recent years.

In the article they stated that:

“The world’s second-largest economy held $1.15 trillion Treasuries as of Dec. 31, down from $1.16 trillion at the end of 2010, according to Treasury data released yesterday. The U.S. revised the figures to show that China held about $51 billion more than reported earlier last month. The revision shows nation’s holdings peaked at $1.3149 trillion in July.”

It seems that the Chinese government is starting to change is policy views towards where to invest their interests in other countries and not just the United States. As the Article China’s Holdings of Treasuries Decline for First Time “China’s policy makers have advocated diversification of the nation’s foreign-exchange reserves away from U.S. assets after more than doubling its holdings of Treasuries since 2007 in the wake of the global financial crisis.”  However, one reason I believe that the Chinese are trying to diversify their investment in our nation’s foreign exchange reserves is that the interest in the US government treasury bonds are starting to go down in terms of yield return.

As the article states that the Yields are going down as a result of the European Debt Crisis:

Yields on benchmark 10-year Treasury notes dropped to a record low of 1.67 percent in September as investors sought a haven from Europe’s sovereign - debt crisis and the Federal Reserve pledged to keep borrowing costs close to zero to sustain economic growth.

So is it that the beginning of the end in terms of reigning in the American public debt.  Well no, because even though the Chinese are pulling away from our US Treasury bonds other countries in Europe, South American and other parts of Asia have stepped in to take up the slack in terms of lend us money.

Japan maintained its place as America’s second-largest lender, with $1.06 trillion of Treasuries in December, while Brazil held $226.9 billion, the Treasury Department said. Hong Kong held $121.7 billion at the end of last year, according to the data. Total foreign holdings amounted to $5 trillion, up from $4.44 trillion in December 2010.

As China’s demand for Treasuries has waned, buyers in Europe have taken up the slack as the region’s debt crisis worsened. Luxembourg increased its holdings by 74 percent to $150.6 billion last year, Switzerland boosted its stake 33 percent to $142.5 billion and Belgium’s position in the debt more-than-quadrupled to $135.2 billion.

So in the end China may show signs of staying away from our riddled credit, but other countries are stepping in to fill the void left by the Chinese, but that is not the point because at the end of the day we in America need to call upon our government to stop there extravagant spending.  I am calling for cuts across the board, whether it be health care, defense, transportation, energy social security, and whatever can be cut there needs to be a slimmer and more efficient government that can run on the revenue from our American taxes instead of borrowing it from other countries. That is what I believe that we should do in terms of helping our country get out of this debt.

 

An America Without Debt?

Debt, a term that is referenced negatively in our modern vernacular, we associate and view the word debt as an idea or thing we should not have or try to get rid of; but what is debt, what makes it so trivial and negative.  Well according to the Miriam-Webster definition of debt, it is “something owed, a state of owing or a common law action for the recovery of money held to be due”.  With that in mind is it a good idea for America to be in debt when debt is an action of owing someone other than oneself, is it a good idea to be in debt to other nations, is it a good idea for the American government to create more debt by spending more money on programs that is a function for our debt. These are the questions I pose to you all today, should America continue on its current path and borrow more money from other countries to fund their programs or should they scale back spending and create a balanced budget for a more stable America.  My view is that we should scale back spending so that we do not have to worry about our government owing anyone money, so that we can have a surplus and then focus on investing in programs that bring back dividends to this country instead of throwing away money into the sea, and finally if we lower the debt we can finally trust our government again to make the proper decisions.

There is no doubt that America is in debt, according the the US Treasury, the total US Public debt stands at about 15.4 trillion dollars, for which most of that is back by US Treasury bonds and securities that are sold by the federal reserve to private investors and foreign nations. 

In 2007 article called “Just who owns the U.S. national debt?” columnist John W. Schoen breaks down the debt.

The money is borrowed from buyers of Treasury securities -- which are basically a big batch of IOUs that are auctioned off every three months. As the auction date approaches, the Treasury figures out how much it will need to pay off old debt and cover the government’s latest round of overspending.

When the auction day comes, buyers submit bids in the form of the interest rate they’re willing to accept. You can choose to make a competitive bid (you ask for a specific rate) or a non-competitive bid (you agree to accept the average rate of other winning bids.) When all the bids are in, the Treasury starts at the bottom, taking the lowest bids until it has collected enough money to cover that round of borrowing.

The money flows in from all over the place: from individual investors and corporations, pension funds and governments, both in the U.S. and around the world. Basically, anyone with a large amount of cash looking for a safe place to put it is a good candidate for holding U.S. Treasury debt.

So just who are these lenders? As of last June (the latest complete breakdown available), the biggest holder of Treasury debt was the U.S. government itself, with about 52 percent of the total $8.5 trillion in paper that's out there. Most of the government’s holdings are massive savings accounts for programs like Social Security and Medicare. Just as you may prefer to keep your Individual Retirement Account in the safe Treasury bonds, the folks who manage the Social Security Trust Fund are looking for a secure investment, too.

That’s leaves a little over $4 trillion in public hands. The biggest chunk (about 25 percent of the $8.5 trillion total) is held by foreign governments. Japan tops the list (with $644 billion), followed by China ($350 billion), United Kingdom ($239 billion) and oil exporting countries ($100 billion).

Other big holders of Treasury debt include state and local governments ($467 billion); individual investors, including brokers ($423 billion); public and private pension funds (319 billion); mutual funds ($243 billion); holders of US savings bonds ($206 billion); insurance companies ($166 billion) and banks and credit unions ($117 billion.)

Once issued at auction, Treasury securities enjoy a healthy second life when they’re traded in the so-called “secondary market” (aka the “bond market.”) The prices of bonds bought on the open market go up and down as the market reacts to changes in demand and news about the economic outlook like inflation. But no matter what you pay for a bond, if you hold it until it matures, the government has to pay back the full amount that was borrowed when the debt was first auctioned and issued.

And, as of January 2011 foreigners owned $4.45 trillion of U.S. debt, or approximately 47% of the debt held by the public of $9.49 trillion and 32% of the total debt of $14.1 trillion.  The largest holders were the central banks of China, Japan, the United Kingdom and Brazil.  The share held by foreign governments has grown over time, rising from 13% of the public debt in 1988 to 25% in 2007.  The largest single holder of U.S. government debt was China, with 26 percent of all foreign-held U.S. Treasury securities.  China's holdings of government debt, as a percentage of all foreign-held government debt, have decreased a bit between 2010 and 2011, but are up significantly since 2000 when China held just 6 percent of all foreign-held U.S. Treasury securities.

So is that a good thing should we allow foreign governments and private corporations to control our national ‘public’ debt, furthermore should the government pass on the national debt to us hard working Americans.  We elected politicians into office so that they can represent our interest in government, but so far what we can tell is that there is so much bickering and infighting in Washington it is hard for the lawmakers and bureaucrats to make up a plan that can get us out of debt and continue on with spending and creating more debt for Americans in our society today.

So what can we do to get us out of this mess?

As of now there is no direct answer or solution to that question, but we can look to past examples for the answers.

Recently, I glanced across a news article; Imagine a world with U.S. Debt by Washington Post columnist Brad Plumer, that sparked my interest in the public debt debate.  In his article he goes on a narrative about a time when the United States did not have debt and that officials in Washington were wondering what they could do with the money.  He compares the scenario of today with the scenario from back in the 1990’s when:

“We’ve all heard the horror stories about what would happen if the U.S. debt burden spiraled out of control. But what if we went in the other direction and paid off our debt entirely? Back in the late 1990s, with the economy galloping and the government racking up budget surpluses, this prospect didn’t seem so implausible.”

What did they do in the past that create the surplus in the 1990’s?

REAGANOMICS

  

The answer to that question would be “Reaganomics.”  In the 1980’s following the turbulent 1970’s where America and the globe were plagued with the oil and energy crises and recessions that created a bleak outlook for the incoming president in 1981; the president along economic advisor William Niskanen, they formulated and introduced the idea of Reaganomics to America. This according to Niskanen was:

"Reaganomics" was the most serious attempt to change the course of U.S. economic policy of any administration since the New Deal. "Only by reducing the growth of government," said Ronald Reagan, "can we increase the growth of the economy." Reagan's 1981 Program for Economic Recovery had four major policy objectives:

(1) Reduce the growth of government spending

(2) Reduce the marginal tax rates on income from both labor and capital

(3) Reduce regulation

(4) Reduce inflation by controlling the growth of the money supply

These major policy changes, in turn, were expected to increase saving and investment, increase economic growth, balance the budget, restore healthy financial markets, and reduce inflation and interest rates.

Reaganomics was based on supply side economics, a theory created by Friedrich Hayek, from the Austrian School of Economics who sought to create a more free market economy, where the government would not interfere and allow for businesses and private investments to grow.  While the government’s sole role was to take charge of the state and to keep the budget from defaulting.

So with Reaganomics President Reagan and successive presidents after him could enjoy an economy that was booming and a government that was lowering their debt by spending less and allowing for Americans to be controlled less by the government.  If we could only follow this model today, I believe that we can lower the national debt in a booming economy.

Now some might argue that this is a bad idea and that deregulation is the reason why America is in its current situation, and that budget cuts will lead to a loss of jobs.   Well that is true deregulation might have caused our current situation and budget cuts might lead to cutting of jobs as well; but that is economics as nothing lasts forever the economy “bears” and “bulls” continuously in it is the way of the market.

I am not arguing for Reaganomics, but I see it as a good alternative to our current situation as of now, which is to lower the current national debt, at the end of the day I see our national debt as a high priority, we need to find a way to lower it and lower it fast.  And if we cannot come up with an idea among the modern economists, well maybe we should look at past examples as to get us out of this debt problem.

President Obama Introduces New Tax Breaks for American Companies, but the Spending in the New Budget is Still Too High

In his weekly address to America, Continuing to Strengthen American Manufacturing, President Obama announced from the Boeing production plant in Everett, Washington about his new tax break plans for companies who keep production here in the United States.  This is a part of his new tax reforms which is geared to bring back more production to America.  In the address, the president is encouraging companies to ‘in-source’ their jobs back to America and said that he would be willing to give tax breaks to companies who return their manufacturing to America.  He stated that, “companies like Boeing are "in-sourcing" jobs from overseas.  [and] The tax code can be used to encourage more companies to do the same.”

President Obama further directed his address to those companies who outsource their work that:

"No company should get a tax break for outsourcing jobs. Instead, tax breaks should go to manufacturers who set up shop here at home.  Bigger tax breaks should go to high-tech manufacturers who create the jobs of the future.  And if you relocate your company to a struggling community, you should get help financing that new plant, that new equipment, or training for new workers.  It's time to stop rewarding businesses that ship jobs overseas, and start rewarding businesses that create jobs here in America.  And Congress should send me that kind of tax reform right away."

Though I agree with the presidents plans to bring manufacturing back to America, and the fact that President Obama is willing to introduce these tax break reforms to help business who bring business or ‘in-source’ production back to the United States is a good thing.  And will help in reinvigorating our economy.   I still believe that the president is still pushing for many programs in the FY 2013 budget that creates a heavier burden on Americans through the unnecessary spending and higher taxes in his new tax reform bills.

In a response address by the Republican Party, United States Representative Cathy Morris Rodgers, the congresswoman who is representing the town of Everett, Washington and the Boeing Plant commented that:

"On February 23, 2009, during a fiscal responsibility summit at the White House, President Obama made a promise to the American people. 'I'm pledging,' he said, 'to cut the deficit we inherited by half by the end of my first term in office.'

Well, in the budget he submitted this week to Congress, the president admitted he won't keep his promise. He won't even come close. Because of the president's failure to control spending, the government will run trillion-dollar deficits in each of his four years in office.

President Obama's broken promises have left our country broke. On his watch, the size of our debt has surpassed the size of our entire economy -- making it harder for small businesses to create jobs and pushing us closer to a fiscal crisis.

I'm afraid his budget is even worse than it looks. More than half of the proposed 'savings' in the president's budget for the next year -- about $2 trillion -- are already law. These savings come from the Budget Control Act -- the bill congressional Republicans insisted that the president sign last year in response to his demand for an increase in the nation's debt limit.

The president spent nearly six months last year resisting those spending reductions, until he finally listened to the people. Another almost $1 trillion in 'savings' comes from what we call the 'war gimmick' -- money that was never requested and will never be spent on wars in Iraq and Afghanistan. Those aren't real savings.

Do the math and you'll discover that the president's budget only achieves, at most, about a tenth of the savings it promises. This kind of accounting would sink any business or household."

Though I support the new tax breaks that the president has introduce in his new tax reforms, and with some reluctance I am temporarily supporting the president’s plan to increase the taxes so that the federal government may generate some revenue.  However, I am still firm on the idea that President cut back on our national spending for the upcoming budgets in the next few years, which is the only way we can get out of our massive public debt and try to work for a more balanced budget.

President Obama's Address: Continuing to Strengthen American Manufacturing

Republican Response Address

As America’s Debt Continues to Rise the Less Americans Feel Safe About America’s Future?

President Obama is to announce his budget for the Fiscal Year 2013 on Monday, in his new budget for the New Year starting in October; President Obama announced will announce his plans. He will plan to make a new standard tax rate for all Americans in America, which will raise taxes across the board for all americans.  However, the new increases in taxes he will also add in new projects for this next fiscal year, which are:

$2.2 billion for advanced manufacturing research and development
$350 billion in short-term job spending,
$476 billion for six-year transportation and infrastructure program
$60 billion to refurbish schools and secure jobs for teachers, firefighters and police officers

However as Andrew Taylor from the Associate Press says:

Obama's 2013 budget, set for release Monday, is the official start to an election-year budget battle with Republicans. It's unlikely to result in a genuine effort to address the $15 trillion national debt or the entrenched deficits that keep piling on to it. But it will serve as the Democrats' party-defining template on this year's election stakes.

The president's plan is laden with stimulus-style initiatives: sharp increases for highway construction and school modernization, and a new tax credit for businesses that add jobs. But it avoids sacrifice with only minimal curbs on the unsustainable growth of Medicare even as it proposes a 10-year, $61 billion "financial crisis responsibility fee" on big banks to recoup the 2008 Wall Street bailout.

This budget plan, administration officials say, borrows heavily from Obama's recommendations in September to a congressional deficit "supercommittee" that was assigned to come up with at least $1.2 trillion in deficit savings as part of last summer's default-avoiding budget and debt pact. The panel deadlocked and left Washington to struggle with bruising across-the-board spending cuts that kick in next January.

In his new plan President Obama will increase not only are taxes but will increase our national debt to fund his new plans.  As I said in my previous blog post The ‘Buffett Bill’ a Bad Idea for America, I do not believe that we should be giving more money to the federal government if they are continually raising the debt ceiling to fund projects that are supposed to create “STIMULUS” but in my opinion have not really done much but raise our debt and put our country more into an economic hole that we cannot crawl out of.

As Virginia Governor Bob Mcdonnel said in the Assoicated Press that,

 

"The Obama approach is simply more debt, more taxes, and more blaming others, this will not be a proactive budget built to promote fiscal responsibility and future prosperity. Rather, it appears we'll see a bloated budget that doubles down on the failed policies of the past.

 

I would agree, for our current situation, for an approach that would raise taxes, but at the same time scale back on in our spending.  We are spending more than we can have thus creating more debt for our country, and making normal average Americans feel like this country will be unable to have the feeling of security and pride for our nation’s once great strength in our economy and our government.  When the “Willy-Nilly” spend our money away on projects that create more debt.

Again, I believe that in our current times we need to pay more taxes, but the government in return should stop spending the money we give them in taxes; and start saving for our future so that we as normal Americans may have a hope of a future where this country is out of the debt of other countries.

Obama budget: New spending with recycled tax ideas   

Obama Budget Bets Other Concerns Will Trump the Deficit

State of the Union 2012