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Discussion Starter #1
The big spenders are setting the GOP up for another phony debt ceiling debate. The party should unify around a proposal to put a ceiling on debt as a share of the economy.


It's hard to feel personal outrage at federal budgets, but we should. We live in a country where Washington is an all-out boom town. The federal government is happily spending $300 billion every month. Of that, $120 billion is borrowed and added to the national debt backed by the full faith and credit of our children and grandchildren.

The "independent" Federal Reserve is artificially funding over half the deficit and has overtaken China as the biggest holder of Treasury bonds. This is wrong and dangerous, creating a precedent for future unelected officials to buy anything on the pretext that it will add to economic growth.

After a national election that demonstrated public outrage over Washington's out-of-control spending and taxes, President Obama's new budget is simply galling. Over the 10-year budget window, the president plans for Washington to extract $39 trillion in taxes and spend $46 trillion. The debt limit, currently $14.3 trillion, would have to grow to over $26 trillion.

Making matters worse, these horrendous spending, taxing and debt numbers would be even grimmer if not for the budget's rosy assumptions. The budget assumes that real growth will climb from an already wishful 4% in 2012 to 4.5% in 2013 and 4.2% in 2014—despite plans for sweeping tax increases. The assumed GDP growth is well over any growth rate achieved in the Bush expansion. The budget also reflects the unrealistic assumption that the Federal Reserve will be able to keep interest rates very low and generate $476 billion in profits through highly leveraged financial speculation.

Mr. Obama's budget also assumes that wages and salaries will grow 6.6% per year in 2013 and 2014, when inflation is assumed to be only 2%. This implies big raises for workers, even though the budget expects high unemployment at 6%-8% in that period.

On top of no recessions, no inflation and big tax increases, the administration's budget assumes no wars. Defense spending is held to $553 billion next year and then grows only $100 billion through 2021—while interest costs alone increase by $600 billion. Under the president's proposal, defense spending would fall to 2.7% of GDP in 2021, half the normal peacetime rate. For the first time, Americans would be paying more to creditors than for defense, a sorry state of affairs.

The budget mentions corporate tax reform but doesn't provide details or leadership. Likewise, the severe problem with growth in Medicare and Medicaid spending is mentioned without any proposed solutions. There is even talk that Washington wants to begin issuing 100-year bonds—the government gets the money now by promising that our great-great-grandchildren will pay it back.

Meanwhile, Republicans have fractured. They know they are supposed to do something about this, and they have proposed welcome spending cuts. But they don't have the power to force lasting fiscal sanity. Some want a grand compromise where everything is on the table. This would inevitably lead to tax increases rather than spending cuts.

Others oppose an increase in the statutory debt ceiling. Since we're already running huge deficits, a debt ceiling would lead to a shutdown of other government functions. The GOP tried this under Newt Gingrich in 1995—producing a big political win for President Bill Clinton. Other Republicans want to amend the Constitution to force a balanced budget. The problem with an annual spending limit is that Congress will often violate it and never look back.

Excess federal spending has been such an intractable problem since the 1970s that a lasting new check and balance is clearly in order. One approach that would reassure financial markets would be legislation to place a ceiling on the debt-to-GDP ratio with a parallel track to put this type of limit in the Constitution. The U.S. desperately needs a cumulative limit on government spending that creates confidence that the government might break the rules in one year but will then have to get back on track.

The battle over curbing big government will be intense. Big spenders in both parties will stall the debate, hoping to turn the vote on the debt ceiling into an up-or-down decision on default. And of course the bill to raise the debt ceiling will eventually have to pass. Then they'll propose a comprehensive deficit-reduction negotiation—code words for big tax increases and few near-term spending cuts.

The sooner Republicans take a unified proposal to the public to create a lasting ceiling on marketable debt, with penalties for noncompliance, the more chance it has of becoming law as part of the debt-limit increase. A fractious GOP attempt to block an increase in the statutory debt ceiling might please a few, but it is a sideshow. It won't have the broad public support vital for breaking Washington's culture. And it won't succeed.

The president should be leading now. He should be deeply involved in the spending-reform efforts the way governors are in New York, Wisconsin, New Jersey, Indiana and elsewhere. Instead, his administration's budget is filled with dodges, scoring gimmicks and unrealistic assumptions. With our economic future at risk, that's an outrage.

http://online.wsj.com/article/SB10001424052748704409004576146403950507220.html
 

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How dare the president side with the tea party freshmen and start killing earmarks! That one vote cost Ohio over 1,000 jobs!

hehehe...

Sucks, but that is the bad that goes hand-in-hand with the good. To balance the budget, we are going to have to cancel a lot of contracts and put a lot of private citizens out of work and trash the bidder's stock value to boot.

But it is a long time coming. Had it been done in the reagan era, as it was initially thought up, then we would not be as ****ed as we are today!
 

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Discussion Starter #3
Why would balancing the budget "trash" collars and create a noticeable drag, economically ? Undoubtedly, some would lose the percentage wagered... but, not in a disproportionate amount when comparison is made to the losses in day to day trading during the same time period.
 

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Obama's "budget" is a farce. He failed to include the painful cuts his own blue ribbon commission recommended, and he catered to his lefist base with myriad tax increases on the rich and on business. He knows his budget is a non-starter, but now he gets to sit on the sideline as the Pubs put on big-boy pants and start recommending the painful cuts needed. Then the Dems can slice and dice the Pubs on a daily basis and throw a spotlight on all of the subgroups injured. The hope is that they can engender a blanket of anti-Pub feeling before 2012. Politics 101.
 

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Discussion Starter #5
:thumbsup:
 

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Obama's "budget" is a farce. He failed to include the painful cuts his own blue ribbon commission recommended, and he catered to his lefist base with myriad tax increases on the rich and on business. He knows his budget is a non-starter, but now he gets to sit on the sideline as the Pubs put on big-boy pants and start recommending the painful cuts needed. Then the Dems can slice and dice the Pubs on a daily basis and throw a spotlight on all of the subgroups injured. The hope is that they can engender a blanket of anti-Pub feeling before 2012. Politics 101.
I think the correct term for this is "PUNT"
Obama was allowed to "punt" last year and produce no budget, and he is doing it again. (Funny, I thought he wanted to be President):crazy:
 

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(Funny, I thought he wanted to be President):crazy:
Well, he does. But I will give him this: The biggest flaw in our democratic system is that painful leadership decisions are always punished at the ballot box, even when everyone knows painful moves are necessary. As a result, politicians are absolutely loathe to be the ones that can be singled out as the source for those decisions. I wish I knew how to solve the problem, but I don't. If the Pubs do what is needed and make painful cuts - whether tax increases are included or not - they will pay a price in 2012. Just look at the thread about the budget repair in Wisconsin. You can't repair a budget without some spending cuts. Those affected scream bloody murder. And in truth, so would I if I felt singled out for the pain.
 

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Plain and simple... for way too many years, the federal government has lived way beyond their means. The Republicans and the Democrats are equally to blame. And the plain simple fact of the matter is we cannot go on spending the way that we are! This country cannot afford to continue to be in debt to countries like China & other communist countries. We have no political clout over these countries when we are hugely in debt to them.

The biggest hit will be the "entitlement" generation that we have raised. We now have an entire generation that has come to live off the government! I mean my God, we have people screaming that they are ENTITLED to cable TV, cell phones & internet access and yet they don't lift a finger to work at a job all day long! And don't get me started on the billions of dollars that are spent to feed, clothe & pay medical expenses for the illegal Mexican aliens in this country.

I have to live WITHIN my budget or I will lose my house, my car, and my utilities would get turned off. I don't have the option of merely printing more money or running out to get another credit card to pay for my debts... it doesn't work that way for me and it shouldn't work that way for the federal government! But we are all kidding ourselves if we think that the government is going to make any REAL or SIGNIFICANT changes! It is all lip service & BS! Both sides are putting on their show for the main stream media! The truly hard cuts that need to be made to balance the budget are not going to happen! And if you DO believe that they will, I've got some ocean-fron property in Kansas to sell you!!!

And by the way.... the ocean-front property is a short-sale.... it's one helluva deal!!!!!
 
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