The Presidential Divider

[Richard]

Wow!

"The speech he chose to deliver was dishonest even by modern political standards."

Richard

The Presidential Divider
WSJ, 14 Apr 2011

Did someone move the 2012 election to June 1? We ask because President Obama's extraordinary response to Paul Ryan's budget yesterday—with its blistering partisanship and multiple distortions—was the kind Presidents usually outsource to some junior lieutenant. Mr. Obama's fundamentally political document would have been unusual even for a Vice President in the fervor of a campaign.

The immediate political goal was to inoculate the White House from criticism that it is not serious about the fiscal crisis, after ignoring its own deficit commission last year and tossing off a $3.73 trillion budget in February that increased spending amid a record deficit of $1.65 trillion. Mr. Obama was chased to George Washington University yesterday because Mr. Ryan and the Republicans outflanked him on fiscal discipline and are now setting the national political agenda.

Mr. Obama did not deign to propose an alternative to rival Mr. Ryan's plan, even as he categorically rejected all its reform ideas, repeatedly vilifying them as essentially un-American. "Their vision is less about reducing the deficit than it is about changing the basic social compact in America," he said, supposedly pitting "children with autism or Down's syndrome" against "every millionaire and billionaire in our society." The President was not attempting to join the debate Mr. Ryan has started, but to close it off just as it begins and banish House GOP ideas to political Siberia.

Mr. Obama then packaged his poison in the rhetoric of bipartisanship—which "starts," he said, "by being honest about what's causing our deficit." The speech he chose to deliver was dishonest even by modern political standards.

***
The great political challenge of the moment is how to update the 20th-century entitlement state so that it is affordable. With incremental change, Mr. Ryan is trying maintain a social safety net and the economic growth necessary to finance it. Mr. Obama presented what some might call the false choice of merely preserving the government we have with no realistic plan for doing so, aside from proposing $4 trillion in phantom deficit reduction over a gimmicky 12-year budget window that makes that reduction seem larger than it would be over the normal 10-year window.

Mr. Obama said that the typical political proposal to rationalize Medicare's gargantuan liabilities is that it is "just a matter of eliminating waste and abuse." His own plan is to double down on the program's price controls and central planning. All Medicare decisions will be turned over to and routed through an unelected commission created by ObamaCare—which will supposedly ferret out "unnecessary spending." Is that the same as "waste and abuse"?

Fifteen members will serve on the Independent Payment Advisory Board, all appointed by the President and confirmed by the Senate. If per capita costs grow by more than GDP plus 0.5%, this board would get more power, including an automatic budget sequester to enforce its rulings. So 15 sages sitting in a room with the power of the purse will evidently find ways to control Medicare spending that no one has ever thought of before and that supposedly won't harm seniors' care, even as the largest cohort of the baby boom generation retires and starts to collect benefits.

Mr. Obama really went off on Mr. Ryan's plan to increase health-care competition and give consumers more control, barely stopping short of calling it murderous. It's hardly beyond criticism or debate, but the Ryan plan is neither Big Rock Candy Mountain nor some radical departure from American norms.

Mr. Obama came out for further cuts in the defense budget, but where? His plan is to ask Defense Secretary Bob Gates and Joint Chiefs Chairman Mike Mullen "to find additional savings," whatever those might be, after a "fundamental review." These mystery cuts would follow two separate, recent rounds of deep cuts that were supposed to stave off further Pentagon triage amid several wars and escalating national security threats.

Mr. Obama rallied the left with a summons for major tax increases on "the rich." Every U.S. fiscal trouble, he claimed, flows from the Bush tax cuts "for the wealthiest 2%," conveniently passing over what he euphemistically called his own "series of emergency steps that saved millions of jobs." Apparently he means the $814 billion stimulus that failed and a new multitrillion-dollar entitlement in ObamaCare that harmed job creation.

Under the Obama tax plan, the Bush rates would be repealed for the top brackets. Yet the "cost" of extending all the Bush rates in 2011 over 10 years was about $3.7 trillion. Some $3 trillion of that was for everything but the top brackets—and Mr. Obama says he wants to extend those rates forever. According to Internal Revenue Service data, the entire taxable income of everyone earning over $100,000 in 2008 was about $1.582 trillion. Even if all these Americans—most of whom are far from wealthy—were taxed at 100%, it wouldn't cover Mr. Obama's deficit for this year.

Mr. Obama sought more tax-hike cover under his deficit commission, seeming to embrace its proposal to limit tax deductions and other loopholes. But the commission wanted to do so in order to lower rates for a more efficient and competitive code with a broader base. Mr. Obama wants to pocket the tax increase and devote the revenues to deficit reduction and therefore more spending. So that's three significant tax increases—via higher top brackets, the tax hikes in ObamaCare and fewer tax deductions.

Lastly, Mr. Obama came out for a debt "failsafe," which will require the White House and Congress to hash out a deal if by 2014 projected debt is not declining as a share of the economy. But under his plan any deal must exclude Social Security, Medicare or low-income programs. So that means more tax increases or else "making government smarter, leaner and more effective." Which, now that he mentioned it, sounds a lot like cutting "waste and abuse."

Mr. Obama ludicrously claimed that Mr. Ryan favors "a fundamentally different America than the one we've known throughout most of our history." Nothing is likelier to bring that future about than the President's political indifference in the midst of a fiscal crisis.

http://online.wsj.com/article/SB1000...pinion_LEADTop

[Paslode]

Too be honest from about the time I heard 'Read my lips, NO NEW TAXES, I personally do not recall a speech from any President within the past 20 years that didn't contain exaggerations, fibs and bold faced lies.......Presidential speeches and politics are pretty vacant, taking stock is such emptiness is foolish.

[Richard]

I personally do not recall a speech from any President within the past 20 years that didn't contain exaggerations, fibs and bold faced lies.......Presidential speeches and politics are pretty vacant, taking stock is such emptiness is foolish.

Do you vote?

If so, why?

Richard

[Paslode]

Originally Posted by Richard

Do you vote?

If so, why?

Richard

Do I vote? The answer to that Sir, is Religiously. As to why, it was engrained into to me from a early age that voting was not only a right but a duty, that my vote made a difference and that if I did not vote I had no room to complain about the outcome.

BUT to be honest, as my hair has thinned and time has passed the process seems more of a corrupt farce with each and every election.

[craigepo]

Originally Posted by Paslode

Too be honest from about the time I heard 'Read my lips, NO NEW TAXES, I personally do not recall a speech from any President within the past 20 years that didn't contain exaggerations, fibs and bold faced lies.......Presidential speeches and politics are pretty vacant, taking stock is such emptiness is foolish.

While I agree that government will never solve all of our problems, I do believe that government folks need to be held accountable. Fatalism and being dismissive will not solve any problems.

[greenberetTFS]

Good point graigepo,I agree..........

Big Teddy

[Paslode]

Originally Posted by craigepo

While I agree that government will never solve all of our problems, I do believe that government folks need to be held accountable. Fatalism and being dismissive will not solve any problems.

The government folks should be held accountable, yet they rarely are.....you might get censured like Charlie Rangel or a slight impeachment like Bill Clinton whereas in the private sector you would likely spend time behind bars for tax evasion or pay out a hefty settlement for fondling the staff.

Unfortunately justice generally gets served when we vote them out of office after years of misdeeds and the damage is done. Then they become lobbyists and mole their way back into the system.

As long as politicians are allowed to campaign endlessly, spin lies, game the system and side step the checks and balances without severe consequences the carnival will continue.


I do what I can do, I vote.

[BrokenSwitch]

Originally Posted by Richard

Do you vote?

If so, why?

Richard

That was addressed to someone else, but it made me think a little bit harder about why I voted the way I did in the last election (first time voting), and why I held the opinions I did during election season in 2004.

In 2004, I felt that Bush started the wars, so he should finish them. The questions about Kerry's Vietnam record and the allegations from the Swiftboat people (I never bothered to actually research Kerry's military record, then or now) affected my judgment, along with the ever-present question "Who throws away a Purple Heart, let alone 3 of them?" Colin Powell's retirement, the reasons for entering Iraq and the invasion's ultimate affect on the geopolitical balance in the region never even struck me as some kind of "red flag."

In 2008, I categorically ignored all of the hubbub of early election season-- I ignored the Democrats as much as I ignored the Republicans. In the primaries, I voted for Edwards because I'm a registered Democrat (it comes with living in Maryland), I distrusted Hillary and had never heard of Obama. After Obama won in the primaries, I saw the cult of personality that was building around him-- and it scared me. That night in November, most of the resident-students at my school were gathered around the big screen in the Commons building, watching as each state's electoral people voted. I returned to my dorm after Florida turned blue because I figured California would carry the day and I wanted to avoid the crowd when it went berzerk.

At the time, I was more concerned about Obama's cult of personality and the radiant, boisterous enthusiasm of his supporters than I was concerned about his association with Jesse Jackson and Louis Farrakhan, or McCain's leadership ability, tech-savvyness (or lack thereof) or Sarah Palin's qualifications for Vice President. I looked at the people around me, and judged what I viewed as their reckless faith to be a greater threat to this country than McCain's seemingly weak or unfocused campaign strategy.

After Richard posed his questions, I wondered what would I have done had the Republicans carried the day with the same margins and cult-following, all other things being unchanged. Today, I realized that the ONLY things about which I am certain regarding the Republican and Democratic party platforms is "Vote for me because I'm not [other party]!" My only knowledge of their track records comes from Bill Clinton, Ben Cardin, Barbara Mikulski, Nancy Pelosi, John Kerry, and Harry Reid from the Democrats; and George W. Bush from the Republicans. Supreme Court? Who's that? Considering there's 535 people in that fancy domed building on Maryland Avenue and I only know 5 by name... that's an eye-opener, even if you include Paul Sarbanes who nominated me to the Merchant Marine Academy just before he retired.

As part of my self-improvement program, I am taking a course about the Vietnam War taught by Dr. Clayton Laurie, so I can better understand the standard against which our current foreign policy is frequently compared. I came to this forum as part of my quest to learn more about (and from) some of the people who execute our foreign policy, and I briefly enrolled (dismissed for saying "yes" to the wrong question at DODMERB (and yes, I did try for a waiver, even arguing over AR 40-501 with an assistant to Cadet Command's CG)) in Army ROTC to experience some semblance of military life first hand.

... and that should be my typing quota for today; time to go check out the library.

[Pete]

Well, the feds and NC government should be happy today. The wife went all bug eyed when she saw the checks we had to write this morning.

So lets see. Wife said it hammered our buget for about the next two months. 06/15/2011 comes real quick for the self employed. Need to build up the reserves.

So that means a lot less eating out and other (paying) forms of intertainment are going to be cut way back. Less money flowing from our hands into local business but more money flowing into Raleigh and Washington. I'm sure there is a lesson in there somewhere.

[nmap]

Originally Posted by Pete

I'm sure there is a lesson in there somewhere.

Yes...but I'm not sure it's an easy lesson. In fact, it may be quite a painful lesson.

On the one hand, our present spending pattern is less one of borrowing than of printing. The Federal Reserve (I call them the Fed) is purchasing U.S. debt, and in a sense, bailing out the U.S. Congress. The term used is "Quantitative Easing". So...the dollar declines compared to other currencies and also commodities. Everyone gets hurt, at least a little.

But there is another side. What is GDP? It can be written as:

GDP = G + I + C + (E - Im)

With G as Government spending
I as private Investment
C as private Consumption
E as Exports
Im as Imports

So, if we cut G - Government spending - then GDP goes down. Growth in the other terms could offset it, but to really control the deficit we need big numbers. Bigger than Ryan's actually.

Could we raise taxes? Sure. But that must surely reduce private Consumption and Investment, so GDP goes down again.

This implies that cutting our excess spending will result in a lot of economic pain, including greater unemployment. Probably much greater unemployment.

If we put spending cuts off, then the pain, eventually, will be even worse.

What to do? I suppose we should endure a lot of pain today in exchange for a better future a decade or more in the future. I cannot see the voters going along with that. I'm not sure I want to go along with it, since there are ways to make money from the current pattern. Bottom line, I see no solution until we hit a crisis.

Do I vote? Absolutely. I enjoy voting against politicians I don't like. It's a cheap thrill....

[1stindoor]

Originally Posted by nmap

Yes...but I'm not sure it's an easy lesson. In fact, it may be quite a painful lesson...

Bottom line, I see no solution until we hit a crisis.

I'm afraid we're already deeply mired in the "crisis" and no one has the political "guts" to call it. Instead we tapdance around the issue, raise the debt ceiling, tax the "rich" (whoever they are) and high five everyone for saving .38 cents of every couple of dollars they've borrowed from somewhere else.

[Paslode]

Originally Posted by Broadsword2004

Well, "technically," George H. W. Bush kept that promise. There were no "new" taxes, he just increased existing ones

Technically....that is like my Brother in Law informing it doesn't matter...it's THE LAW, but deep down inside we all know it is very wrong.... LMAO! But true!

I just remember asking people if they believed him, and being dismayed at the number people that believed Bush could, all by himself make that happen (He's not going to raise my taxes, I am going to vote for him!).

And then explaining that we had this checks and balance system, that the President was only 'One person' that might have the ability to veto a tax increase, he might have some input, but he does not write the tax laws or any other legislation all by his lonesome.....that's what your Congress and Senate do, and they can make his promises become lies.

That was back in the day....now days with Signing Statements, Executive Orders, CZAR's I am not sure things run like that anymore

Originally Posted by 1stindoor

tax the "rich" (whoever they are)

'Rich' is a fluid value or basis and is seen as anyone or anything having more than the more than the norm or majority.

It works like this


First they came for the people making over 1 million dollars
and I didn't speak out because I don't make 1 million annually.

Then they came for those who make 500k annually,
and I didn't speak out because I don't make 500k annually.

Then they came for those that made 250k annually,
and I didn't speak out because I don't make 250k annually.

Then they came for me because I made 35k annually
and there was no one left to speak out for me

[GratefulCitizen]

Originally Posted by nmap

On the one hand, our present spending pattern is less one of borrowing than of printing. The Federal Reserve (I call them the Fed) is purchasing U.S. debt, and in a sense, bailing out the U.S. Congress. The term used is "Quantitative Easing". So...the dollar declines compared to other currencies and also commodities. Everyone gets hurt, at least a little.

But there is another side. What is GDP? It can be written as:

GDP = G + I + C + (E - Im)

With G as Government spending
I as private Investment
C as private Consumption
E as Exports
Im as Imports

So, if we cut G - Government spending - then GDP goes down. Growth in the other terms could offset it, but to really control the deficit we need big numbers. Bigger than Ryan's actually.

Could we raise taxes? Sure. But that must surely reduce private Consumption and Investment, so GDP goes down again.

This implies that cutting our excess spending will result in a lot of economic pain, including greater unemployment. Probably much greater unemployment.

If we put spending cuts off, then the pain, eventually, will be even worse.

What to do? I suppose we should endure a lot of pain today in exchange for a better future a decade or more in the future. I cannot see the voters going along with that. I'm not sure I want to go along with it, since there are ways to make money from the current pattern. Bottom line, I see no solution until we hit a crisis.

Positive influence over the economy is slipping away from both the Fed and the federal government.

The Fed has purchased US debt, but that has not yet turned into significantly more money.
Banks are sitting on those reserves, and other entities are still hoarding their cash as well.

The Fed can create reserves, but it can't force banks to lend nor can it make companies spend.
The problems are rooted in excessive government spending (as a percentage of the economy) and the uncertainty created by government policies written in pencil, rather than pen.

Whether the federal government taxes or borrows to finance spending isn't nearly so important as the percentage of the economy it confiscates through spending.
Government is far less efficient at allocating resources than the private sector.

The private sector will keep its powder dry so long as the government policy remains unpredictable.
Once policies become predictable, the private sector will pursue the highest profit path.


Government spending as a percentage of the economy is the number which matters (G / GDP).

More "G" means less efficient allocation, and slower GDP growth (creating a vicious cycle).
Uncertainty in regulations mean slower GDP growth.

Politicians purchase reelection with "G".
They also get campaign money by tweaking policy to favor their benefactors.

The interests of politicians and the economy are not aligned.
Eventually, market discipline will reign in the government through interest rates.

The hope lies in deregulation in order to grow out of the problem.
That won't happen until some more bums are thrown out of office.

[Dusty]

Originally Posted by nmap

Yes...but I'm not sure it's an easy lesson. In fact, it may be quite a painful lesson.

What to do?

Abolish the capital gains tax. Adopt a fair tax. Problem solved.

[Paslode]

Originally Posted by Broadsword2004

From what I understand of it, Congress (Democratically-controlled at the time) had promised President Bush they would cut spending for every dollar of increased revenue, but I do not think they did any such thing.

The age old art of art of Skullduggery