FEDERAL BUDGET / DEBT
Sunday, April 10, 2011
WorldNetDaily Exclusive
An urgent message from WND's Joseph Farah
Here's an opportunity for you to take Washington back
Posted: April 09, 2011
8:10 pm Eastern
By Joseph Farah
In November we had an historic election.
Republicans took over the House of Representatives and made gains in the Senate. They did so because Americans recognized they made a big mistake in the previous election. They didn't like the fact that the people in power were trying to "fundamentally transform" America from its roots as a self-governing nation under the rule of law to one based on top-down, command-and-control tyranny.
Since then, I've been watching Republican leaders in the House trying to reason with the Democrats, trying to bargain with them, trying to negotiate some middle ground with them, trying to compromise with them on issues that fundamentally do not have any room for bargaining, negotiating, compromise or middle ground.
We've all been watching the debate over fiscal policy taking place in Washington: Republicans proposing modest cuts in government, apparently expecting Barack Obama and Democrats in the Senate to go along with them in the interest of saving the country from economic collapse from unsustainable debt.
Of course, Obama and the Democrats will have none of it. They think because they control the White House and the Senate they should continue to dictate policy – even if their policies are clearly driving the nation off a cliff into bankruptcy and depression. And most of us look at that and think, "You know, it's too bad. But I guess there isn't anything we can really do until 2012."
That's the trouble with conservatives. They're too conservative – even when times call for radical action to preserve the foundations of our country.
Let me tell you how conservatives need to be responding to the national emergency we find ourselves in today.
When Republicans won the House last November, I started asking myself what could they accomplish in the next two years to derail the destructive, irrational policies of Obama and the Democrats – with control of the House alone.
What could they do to stop the advance of Obamacare?
What could they do to save the economy?
What could they do defund Planned Parenthood?
What could they do to end subsidies for left-wing propaganda on NPR and PBS?
What could they do to get Washington out of education to stop the indoctrination of another generation of kids?
What could they do to ensure we didn't double the debt again in the next two years as we did in Obama's first two years in office?
What could they do to start moving us back to constitutionally limited government? It seemed impossible at first to figure out a strategy that could actually advance the agenda.
But then it hit me – as it did a few members of Congress, people like Sen. Jim DeMint, Rep. Michelle Bachmann and Rep. Ron Paul.
The answer was for Republicans in the House of Representatives to simply say no to raising the debt limit, while also saying no to any increase in taxes.
There's a lot of power in saying "no" when you control one of the houses of Congress.
When it started two months ago, we could identify only about six Republicans in the House who were on board with a no vote on raising the debt limit.
Then we began the "No More Red Ink" campaign targeting just the 241 Republicans who control the House. We empowered Americans with a tool that allowed them inexpensively and efficiently to send red letters to all 241 Republican House members urging them to say no to any hike in the debt limit – an action that would require the federal government to stop borrowing immediately and make the biggest cuts in spending in the history of the country.
So far, we have enabled nearly 1 million of those letters to be delivered to House Republicans.
About a month ago, we polled House Republicans on where they stood on this critical issue. And we found to our own amazement that 122 stood firmly opposed to raising the debt limit for any reason – just about half.
Two weeks ago, as the campaign continued, we polled again and found 142, a clear majority, were now dead set against raising the debt limit.
It only takes 218 votes in the House to stop the borrowing and spending madness and start returning this country to fiscal sanity and constitutionally limited government.
I am convinced the only way we will achieve that goal is to starve the beast. And Republicans, those we sent to Washington to take over the House in November, have all the power to do that – right now, not in 2012 or 2013.
I'm amazed at how effective this campaign has been in such a short time – while literally no one else outside of the Capitol was doing any serious lobbying on the issue or even talking seriously about the idea of a no vote on raising the debt limit.
Do you realize how close we are to taking Washington back?
If we pull this out, it would completely tie the hands of Obama and the Democrats for the next two years. They themselves – the Democrats – would be forced to make massive cuts in spending that would require defunding Obamacare, pulling the plug on Planned Parenthood, even killing entrenched unconstitutional bureaucracies like the Department of Education. They simply wouldn't have any choice.
Sounds pretty radical, doesn't it? Sounds almost too good to be true.
The only thing stopping us from achieving this victory is the position of the House Republican leadership, which says we must raise the debt limit or risk default on our loan obligations – mimicking what they've heard from the Federal Reserve and the treasury secretary.
But it's not true.
The Heritage Foundation, Investors Business Daily, the CATO Institute and many other credible and authoritative sources have looked at this question and determined that is simply not the case. Washington could still continue to meet the payments on its loan obligations and continue all of its vital and constitutional obligations to the American people with its trillions of dollars of revenues.
Think about it.
Nobody else in America has the privilege of borrowing endlessly to pay for whatever they feel like spending – no companies, no individuals, not even state or local governments.
It's not responsible and it's not sustainable.
The biggest fiscal problem we have in America is unsustainable debt. How are we going to address that with continued borrowing? It makes no sense.
What we see in Washington today is Keynesian economics gone wild. There is no borrowing solution to America's economic problems. America's economic problems are the result of too much borrowing.
In the next 30 days, conservatives and Republicans are going to have to make a choice. Do we allow Obama and the Democrats to continue borrowing to pay for their insane, extra-constitutional programs or do we just say no?
House Republicans have all the power to just say no. The vast majority of them want to say no. But their leadership is telling them they can't. If John Boehner on Monday morning had an epiphany on this and gave his membership permission to think outside the box and to use their power to reverse course, they would do it in a heartbeat.
Believe it or not, there are even a few Democrats who would go along with them – several in the House and Senate are already on record as opposing a hike in the debt limit.
That's the choice we face in the next 30 days – and, under the radar screen, we are making real progress toward this objective.
If you want to be a part of this historic effort, I urge you all to go to NOMOREREDINK.com and send your letters today – right now.
I'm telling you this because it's the only hope of beginning the turnaround our country so desperately needs right now – not in 2013, which seems like a long way from now.
One little media company started this effort. There's been virtually no publicity about it, no news coverage, no great debates, not even much help from the major conservative talk shows. Yet, we've delivered nearly 1 million personally addressed and personally signed letters to 241 House Republicans that seems to be making a big difference in their perspective, despite what their leadership is telling them
By the way, Republicans had better demonstrate this kind of leadership now or they will find themselves out in the political wilderness in 2012. They have an opportunity to do something dramatic, to set the terms of debate, to dictate fiscal policy in Washington – and they are on the verge of blowing it.
There is nothing else like this vote on the debt limit. It's the magic bullet.It's the political nuclear weapon that Republicans hold in their hands. It shouldn't be traded away for promises by the Democrats to do better, when we know they won't. It's not in their nature. It's not in their hearts.
So what is holding back Boehner and the House Republican leadership. Well, they hear the dire warnings of Timothy Geithner, who couldn't fill out his own tax form, and the other so-called experts. They're afraid of getting out-maneuvered by Obama and the Democrats. They're afraid of what the media will do to them. That's why they're not demonstrating the leadership that they were handed by the American people who, according to every poll, support this kind of dramatic action.
The only thing holding them back then is a lack of encouragement. That's what we are providing with the "No More Red Ink" campaign.
I hope, in the next 30 days, you will encourage every one of your friends, your Facebook pals, your Twitter followers and everyone on your email list to take part in this campaign. And, most of all, I hope and pray you will take part – as I have.
We are right on the precipice of a stunning, historic victory that will fundamentally transform the way Washington conducts its business – and that is something the country desperately needs
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IBD Editorials
DON'T LET DEBT LIMIT GET IN THE WAY OF THE PARTY
By MARK STEYN Posted 4/29/2011
The other day Paul O'Neill said that......
Oh, wait, I suppose I ought to explain who Paul O'Neill is. A decade ago, he was George W. Bush's first Treasury secretary. I have no very clear memory of him except that he toured Africa with Bono and they were photographed in matching tribal dress looking like Col. Gadhafi's Mini-Me twins at a Tripoli sleepover. Other than the dress-up fun, I've no idea why they were in Africa, but you paid for it, so I'm sure there was a good reason.
Anyway, Secretary O'Neill popped up the other day on Bloomberg Television to compare debt-ceiling holdouts to jihadists. "The people who are threatening not to pass the debt ceiling," he said, "are our version of al-Quaida terrorists. Really."
Really? Absolutely.
They're really putting our whole society at risk by threatening to round up 50% of the members of the Congress, who are loony, who would put our credit at risk."
But hang on, generally speaking, when you hit your "debt ceiling," your credit is at risk. If you've got a $10,000 credit card, and you run it up to the limit, but you need a couple more grand right now, pronto, because you outspend your earnings by 50% every month and you have no plans to change that any time soon, well, the bank might increase the limit to $15,000, or $20,000. Or they might not. There is a question mark over your credit because there is a question mark over your creditworthiness: It is at risk.
Paul O'Neill seems to regard that attitude as unhelpful. So does Timothy Geithner, his successor at what is still laughingly known as the United States Treasury, Geithner says that even to be discussing the debt ceiling is "a ridiculous debate to have."
Ridiculous? Absolutely.
"I mean, the idea that the United States would take the risk that people would start to believe we won't pay our bills," continued Geithner, "is a ridiculous proposition, irresponsible, completely unacceptable."
The best way to persuade people to believe we'll pay our bills is to borrow up to our limit, and then increase the limit and borrow a whole bunch more. This would be the 75th increase in the debt ceiling in the last half-century. Let's just get it done, and resume the party.
But if Geithner thinks that even discussing the question is "ridiculous," then, as my colleague Jonah Goldberg put it, why have a debt limit at all? What's the point?
Well, because it gives us more credibility with our creditors, right? Even if we set the debt ceiling way up in cloud-cuckoo land to a bazillion trillion gazillion dollars and 83 cents, even a debt limit entirely unmoored from reality still gives the impression we haven't quite flown the coop.
Yes, but why does the U.S. government need to maintain credibility with its creditors when increasingly it's buying its debt from itself? Every month there's more and more U.S. Treasury debt and fewer and fewer people who want it. The Chinese are reducing their exposure. The investment behemoth Pimco, which manages the world's largest mutual fund, recently dumped U.S. Treasuries entirely.
To avoid the failure of U.S. bond auctions, or an increase in interest rates to make them more attractive to rational lenders, the U.S. government's debt is bought by the U.S. government's Federal Reserve.
I tried up above to come up with a real-world comparison for the debt ceiling -- imagine you've got a credit card limit of 10K, etc. -- but it's harder to do that with the Fed's policy: Imagine your left hand issues an IOU to your right hand in return for an e-mail with a large number on it ... oh, never mind, it'll only make your head hurt.
"Quantitative easing: is extremely quantitative if not terribly easing, so raising the debt ceiling would enable us to issue more debt for us to buy from ourselves. You can see why Secretary Geithner thinks that's a no-brainer.
While Jonah Goldberg was asking why have a debt limit at all, Michael Kinsley took it to the next stage: "If the national debt doesn't matter, why have taxes at all?" Particularly when you no longer have to "print" money, you can just quantitatively ease yourself into it.
Once we raise the old debt ceiling, we'll be pretty much at the point where the U.S. government is spending four trillion but only taking in two trillion: For every dollar we raise in taxes, we spend two.
No surprise there: The "poorest" half of the population pay no federal income tax. They're not exactly poor as the term would be understood in almost any other country, but in federal revenue terms they're dependents, so in order to fund government services for the wealthiest "poor" people on the planet we borrow money from a nation of subsistence peasants where pigs are such prized possessions they sleep in the house.
But, if you can spend four trillion of which two trillion is borrowed, why not borrow three and make even more Americans dependent? Hell, why not borrow the whole lot? After all, the sums we're borrowing right now -- $188 million every hour of ever day -- are unprecedented.
Wouldn't it be easier if we just made them even more unprecedented? That way we could have a federal budget of six trillion, of which, say, five trillion is raised by issuing Treasury bonds for the Federal Reserve to buy. That would stimulate the economy by creating 17 jobs for any remaining Americans who still feel the need to leave the house every morning.
Now that I think about it, I seem to remember Secretary O'Neill and Bono were swanking around Uganda and Ethiopia in tribal garb as part of the Irish rocker's campaign for African debt forgiveness. Now there's an idea. And, if it works for Africa, why not closer to home? After all, Bono supported the IMF's Heavily Indebted Poor Countries Initiative, and America is way more "heavily indebted" than Uganda will ever be.
Under the 2011 budget, every hour of every day the government of the United States spends a fifth of a billion dollars it doesn't have.
Who does have it?
Er, the Federal Reserve?
A few years ago, I raised the ceiling on my own house. You can do that -- up to a point. It depends on whether your foundation is solid and your framing is structurally sound. But, even if they are, you take it too high and the roof falls in. We're structurally about as screwed up as you can get, and the foundation is badly cracked. But hey, let's just jack the roof up a little higher one more time. What could go wrong?
At this stage, nothing does more damage to our "full faith and credit" than business as usual. If you're going to bandy glib, witless al-Quaida analogies, the conventional wisdom Paul O'Neill represents is the real suicide bomb here. Men like O'Neill and Geithner think they're quantitatively easing American decline. They're not. They're quantitatively accelerating American collapse.
Onward and upward.
Mark Steyn, 2011
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IBD Editorials
Perspective
AmeriCorps: A Case Study In Why U.S. Is Now Bust
By MICHELLE MALKIN Posted 04/18/2011 06:47 PM ET
So much for the new era of fiscal responsibility. The federal government's dependency drones have been spared the chopping block.
After vowing to eliminate funding for President Obama's bloated $6 billion AmeriCrops social justice army, Hose Republicans retreated - and will shrink the AmeriCorps budget by a minuscule 6.7%.
Politicians originally sold AmeriCorps as an alternative to big government - a program to "renew the ethic of civic responsibility and the spirit of community throughout the United States."
With bipartisan support, the program has morphed into an all-purpose progressive slush fund. Instead of reining in the national service boondoggle, Washington has turned taxpayer-subsidized helping hands into a legion of Nanny State handout helpers.
Goodbye, AmeriCorps.
Hello, FoodStampCorps.
Yes, across the Internet, the feds are recruiting AmeriCorps VISTA (Volunteers in Service to America) workers to apply for jobs as publicists for the welfare state. Their mission: to sign up as many people to federal food stamp rolls as possible. Because, you know, the record breaking 12 million that have been added since Obama took office is apparently not good enough.
Here's a typical job ad in Boston: "AMERICORPS VISTA: FOOD STAMP COORDINATOR (INTERNSHIP). Through this project, the Elderly Commission will e able to provide information, assistance and support to senior citizens of Boston in applying for food stamps. develop a full knowledge of the Food Stamp program and application process.
"Assist seniors in senior housing and community centers to fill out Food Stamp applications; followup with the Department of Transitional Assistance to ensure seniors receive awarded benefits. Recruit volunteers to be trained on the application of the Food Stamp program."
In New York, Philadelphia and a total of 30 sites across the country, AmeriCorps and the Department of Agriculture are funding the "National Anti-Hunger nd Opportunity Crops" to "increase access to food stamps."
National Affairs managing editor Meghan Clyne reports that the administration is roping in left-wing churches to aggressively promote food stamps. With institutional support from first lady Michelle Obama, the FoodStampCorps will train church members to apply for food stamps after religious services and "encourage eligible families to enroll their children in (government-subsidized) school meal programs.
If organizations operate day-care of after-school programs, they are advised to pursue reimbursement for meals and snacks through the child and Adult Care Food Program (a federally funded, state-administered welfare program). Places of worship are asked to serve as feeding sites for the Summer Food Service Program - another federally funded, state run welfare project."
With billions poured into the welfare state at the local, state and national levels and enrollment at an all-time high, why should taxpayers be underwriting make-work jobs for future Democratic flacks-in-training? Shouldn't it already be the job of the vast network of existing social services and welfare agencies to publicize and assist food stamp applicants?
More troublesome: AmeriCorps workers are themselves being encouraged to sign up for food stamp benefits - giving new meaning to "hands-on" (or rather, "hands-out") experience.
An AmeriCorps blogger provided a thorough advice manual on working the system: Plenty of jobs come with perks," the worker wrote. "For some these come int he form of company cars, dental insurance or a spending allowance. For VISTAs, it's food stamps.
The step-by-step guide tells AmeriCrops workers: "If you apply for food stamps after you become an AmeriCorps VISTA member, you will have a decreased food stamp allotment. So if you're debating applying, you should do it now.
Another AmeriCrops tip for those preparing for their in-person eligibility itnerview with food stamp administrators: "These social service agencies are only open during regular business hours, so you will probably have to take the day off (some sites don't count it against your 20 vacation/sick days)." Oh, and don't forget to "bring a book."
Says the wise AmeriCorps welfare-system expert: "While food stamps are handled by a different agency in every state, they all generally have a reputation that mirrors that of the DMV: too little staff, too high demand and wait times that can border on extreme.
"While my own wait was only three hours, I've heard some VISTAs waiting as long as eight. Yes, I know you may have an appointment, but doesn't necessarily mean they're going to see you at that time. So bring a book, an iPod, that screenplay you've been tinkering with - whatever, because you're going to be waiting a while.
Make no mistake: Americans are suffering as a result of this profligate administration's job-stifling and anti-economic growth policies. No one questions the need for a basic safety net to care for those most in need of help.
But the community-organizer-in-chief is squandering billions on failed Alinsky-ite rackets that are geared toward ever-expanding service not to the individual, but to the insatiable state.
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Obama Lights Fuse On Time and Debt Bomb
By LAWRENCE KUDLOW (Posted 4/13/2011) 07:00 PM ET
We thought tax reform meant lowering rates and broadening the base by eliminating or cutting back on various deductions, credits and loopholes. That's what the Bowles-Simpson commission proposed. That's what Paul Ryan and David Camp are working on. And, that's the pro-growth model.
But President Obama unveiled a much different tax-reform vision in his much-anticipated debt speech on Wednesday. He would raise tax rates on upper-income earners and small businesses. He also would eliminate deductions and credits, or so-called "tax expenditures".
The president referred t these tax-expenditure reductions as "spending cuts." In his context, they most certainly are not. They are more tax hikes.
Basically, the president is giving successful earners and small-business filers a double tax hike. That's what it really is.
Of course, the president's formula of estimating higher revenues to lower the deficit is completely wrong. The reality is that higher tax rats will slow the economy, inhibit new start-up companies, penalize investors, and may very well lose revenues and increase the deficit.
In the latter part of his speech the president did mention some kind of middle-class and corporate tax reform. But he gave no specifics.
He also touted $750 billion in discretionary spending cuts, but again without any details. Most of that amount probably comes form the recent continuing resolution to avoid a budget shutdown. Since Obama is extrapolating out 12 years, who knows how this is scored?
On the entitlement front, Obama rejected Paul Ryan's consumer-choice and competition approach to Medicare reform. Instead, he invoked the ObamaCare central-planning agency called the Independent Payment Advisory Board, which is supposed to make reductions in Medicare. Medicare itself would exercise more price controls on prescription drugs, rolling back the consumer choice and competition established under George Bush.
In total, President Obama is claiming $4 trillion in deficit-reduction over 12 years. But we'll never see it. Interest expense savings is supposed to make up $1 trillion of that amount, while the rest will somehow come from a concoction of fewer tax deductions, higher tax rates and $400 billion in defense-spending cuts.
In effect, the president has moved to the left. He has embraced the Democrats' so-called progressive caucus in the House by slashing defense and jacking up taxes, all while offering no serious entitlement reform.
My final point is this: President Obama's harsh-rhetoric rejection of the Ryan budget and his new (presidential) campaign to raise taxes on the rich sets up a huge confrontation with House Republicans on the eve of the hugely important debt-limit expiration.
Sometime in mid- to late May, the debt ceiling to allow the government to borrow more money is going to run out. The Treasury can move money inside government accounts to forestall a debt breakdown for another couple of months.
But the potential for a major political conflict on the eve of this process sets up the worst possible outcome: Failure of the U.S. to pay the interest on its own debt. This is unnerving to financial markets. Instead of compromise, the president decided to seek confrontation.
Caveat emptor. Investors beware. .
