Truth is the beginning of wisdom…

Archive for March 5th, 2009


Posted by straight shooter on March 5, 2009 under Economy, Political

In his campaign and inaugural address, Barack Obama cast himself as a moderate man seeking common ground with conservatives. Yet his budget calls for the radical restructuring of the U.S. economy, a sweeping redistribution of power and wealth to government and Democratic constituencies.

The real Obama has stood up, and lived up to his ranking as the most left-wing member of the United States Senate.

He has declared war on the Right even though from the other side of his mouth he wants their input … right!

Republicans are under no obligation to render bipartisan support to this statist coup d’état. For what is going down is a leftist power grab that is anathema to their said principles and philosophy.

Where the U.S. government usually consumes 21% of gross domestic product, this Obama budget spends 28% in 2009 and runs a deficit of $1.75 trillion, or 12.7% of GDP. That is four times the largest deficit of George W. Bush and twice as large a share of the economy as any deficit run since World War II.

Add that 28% of GDP spent by the U.S. government to the 12% spent by states, counties and cities, and government will consume 40% of the economy in 2009.

We are not “headed down the road to socialism.” We are there.

Since the budget was released, word has come that the U.S. economy did not shrink by 3.8% in the fourth quarter, but 6.2%. All the assumptions in Obama’s budget about growth in 2009 and 2010 need to be revised downward, and the deficits revised upward. So, look for the deficit for 2009 to cross into $2 trillion.

Who abroad is going to lend us the trillions to finance our deficits without demanding higher interest rates on the U.S. bonds they are being asked to hold? And if we must revert to the printing press to create the money, what happens to the dollar?

As Americans save only a pittance and have lost – In the value of homes, stocks, bonds and other assets – $15 trillion to $20 trillion since 2007, how can the people provide the federal government with the needed money?

In his speech to Congress, Obama promised new investments in energy, education and health care. Every kid is going to get a college degree. We’re going to find a cure for cancer. Who is going to pay for all this?

The top 2%, those filthy rich who got all those Bush tax breaks, say Democrats. But the top 5% of income earners already pay 60% of U.S. income taxes while 40% pay nothing. So, you do the math who do you think the next target will be?

Those paying a federal tax rate of 35% will see it rise to near 40% and will lose 20% of the value of their deductions for taxes, mortgage interest and charitable contributions.

Yet, two-thirds of small businesses are taxed at the same rate as individuals. Consider what this means to the owner of a restaurant in Los Angeles, where a husband and wife each put in 80 hours a week. At year’s end, the couple finds they have actually made a profit of $500,000 that they can take home in salary. What is the tax on that salary?

Their U.S. tax rate will have hit 39.6% while their California income tax will have hit 9.55%. Then their Medicare payroll taxes on the proprietor as both employer and salaried employee will be $14,500. Add the Social Security payroll taxes for the proprietor as both employer and employee at $13,243.

In short, U.S. and state income and payroll taxes will consume half of all the pair earned for some 8,000 hours of work.

From that ravaged salary they must pay a state sales tax of 8.25%, gas taxes for the 50-mile commute, and tens of thousands in property taxes on both their restaurant and home. And, after being pilloried by politicians for having feasted in the Bush era, they are now told the tax deduction they get for contributing to the church is to be cut by 20%, while millions of Obama voters, who paid no U.S. income tax at all, will be getting a tax cut in April.

If you are a small business person in Californian is it time to flee the Golden Land … but will it be any better anywhere?

Markets are not infallible. But the stock market has long been a “lead indicator” of where the economy will be six months from now. What are the markets, the collective decisions of millions of investors, saying? Since falling every month from Obama’s election, with January and February the worst two months in history, they are telling us the stimulus package will not work, that Tim Geithner is clueless about how to save the banks, that the Obama budget portends disaster for the republic.

The president says he is gearing up for a fight on his budget. If no one fights him we all lose … if we pay taxes that is!

“Government’s view of the economy could be summed up in a few short phrases: If it moves, tax it. If it keeps moving, regulate it. And if it stops moving, subsidize it.” as Reagan aptly put it.

DEBT #1 – $700 Billion ($700,000,000)

This out-of-control government spending started when George W. Bush lost his conservative sense and bailed out Wall Street with $700 billion.

DEBT #2 – $787 Billion ($787,000,000)

Congress didn’t learn from that failure, and apparently neither did Barack Obama as he continues to scold and blame Bush, while he spends even more. The president uses fear and pushed for the stimulus bill for $787 billion.

DEBT #3 – $410 Billion ($410,000,000)

That wasn’t enough for them so the recent $410 billion omnibus spending bill (with 9,000 earmarks – 60% of them from Democrats and 40% of them from Republicans) is currently being railroaded through Congress to keep government “moving” until September.

DEBT #4 – $634 Billion ($634,000,000)

And then Obama informed us last week that another $634 billion is required for a down payment on universal health care … without a plan in place … and this is just a payment.

DEBT #5 – $3.6 Trillion ($3,600,000,000,000)

If that isn’t enough, Obama is asking for a roughly $3.6 trillion budget for 2010 despite the fact that the White House projects a 2009 budget shortfall of $1.5 trillion which is triple the $455 billion in 2008. Whose fault is that going to be? It always seems to be someone else’s.


Sen. Daniel Inouye (D-Hawaii), the chairman of the Appropriations Committee, noted when he called the mammoth $787 billion spending bill “stimulus No. 1.”, indicates other stimuli on the horizon which would be debt #6, #7, etc.

With all of these wild expenditures there are still no signs of any economic recovery. This stimulus didn’t stabilize or grow the economy and the market. All the government bailed outs and still the Dow Jones industrial average has dropped … and continues to do so. It dropped about 2,000 points since Obama took office, roughly 200 points after every major speech he has made.

So the big question is: How has Obama gotten away with racking up more expenses in his first 30 days in office than all the presidents combined since the founding of our republic did in theirs?

Bernard Goldberg’s A Slobbering Love Affair is a book about the media’s blind bias and infatuation with Obama. How Obama’s hypnotic effects permeate every stratum of society, from political corridors to public schools. Why? Because he’s young, hip, cool, liberal and charismatic – and that’s what sells today in America. Hey the President is cool … that’s more important than the reality of the chaos in America. Objectiveness and criticism fly right out the window with the mere mention of his name or any discussion of his excessive spending plans. Reality is trumped by glassy-eyed emotion.

On “Good Morning America” last Thursday, two of ABC’s Obama biased financial experts graded Obama’s excessive borrowing and fiscal performance a B, while guest financial expert Dave Ramsey in reality rated it an F. Despite the two B grades, one of ABC’s financial experts quipped that one of the biggest problems with Obama’s bailouts is that there is no real form of government accountability over the money pouring out of Washington. That is a huge problem, yet she maintained her B grade for Obama’s stewardship plan. Why? Slobbering!

As Obama addressed Congress last week, House Speaker Nancy Pelosi led the way in spontaneous emotive applause for her political hero. “Pop-up” Pelosi was bouncing up and down like a little school girl with a crush, forcing Vice President Joe Biden to rise slowly every time she jumped up, and Biden had to try to hide his frustration with her. Pelosi’s eyes and facial expressions seemed almost giddy as she gazed at Obama like a teenager infatuated with the popular high-school jock. Is this really the type of objective bipartisan leadership we want running our government, leading our nation, and spending our money?

America’s political love affair with President Obama plus the Democratic majority’s coercions in Congress equals more economic chaos with trillions of dollars in new debt for Americans. A commitment to spending caps and balancing the budget must is paramount.

The Congress of the ’90s steadied and strengthened the economy by following four priorities and principles, which are being turned on their heads at this moment by the present administration.

  • Cut taxes to increase economic growth and therefore increase revenues (unlike Obama’s tax hikes, which will retard economic growth and depress revenues).
  • Set priorities and increase spending in key areas while reducing it in nonessential areas (unlike Obama’s fiscal priorities of health care, energy and education, which are based not upon what is best for the economy but what is reflective of typical partisan preferences and doing what is politically expedient).
  • Eliminate pork-barrel spending (unlike the 9,000 earmarks in the present $410 billion omnibus spending bill, which is nothing short of absolute economic ludicrousness, mismanagement and waste within our present crisis).
  • Shift from expensive, wasteful systems to smarter spending; look at not only more inexpensive ways but also more productive ones (unlike Obama’s theory to spend our way to prosperity, which is a sure way to sink America).

The nanny state is upon us. Our Founders are rolling in their graves. Day by day Washington’s credit-crazy and debt-accumulating addiction is dissolving our sovereignty by handing our financial autonomy over to other nations. In other words, America is burning, and Obama is stoking the fire!

Time is running out, but it’s not too late to reverse Washington’s fiscal frenzy. Don’t just write to your representatives but hound them to live and legislate by the preceding four proven priorities and principles of governmental and monetary prudence.

If things don’t change, forget the college education and takes courses in hunting, fishing, farming and a good survival course … you will need it to survive.

PS: Check out your own calculations on who will be paying for this debt and how much that will be per person or family.

Debts 1-5 above not including any additions – $3,602,531,000,000 / 3000,000,000 = $12,008.44 per person
1 million – 1,000,000 x 1000 = 1 billion
1 billion – 1,000,000,000 x 1000 = 1 trillion
1 trillion – 1,
America’s population 300,000,000 approx.

Estimated Population (July 2008): 303,824,640

Age structure:
0-14 years: 20.1% (male 31,257,108 / female 29,889,645)
15-64 years: 67.1% (male 101,825,901/female 102,161,823)
65 years and over: 12.7% (male 16,263,255/female 22,426,914)