Tuesday, March 16, 2010

Barker's Newsbites: Tuesday, March 16, 2010


Busy, busy day... but I'll do what I can do.
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16 comments:

William R. Barker said...

http://apnews.myway.com/article/20100316/D9EFLQB80.html

Federal agencies haven't lived up to President Barack Obama's promise of a more open government, increasing their use of legal exemptions to keep records secret during his first year in office. An Associated Press review of Freedom of Information Act reports filed by 17 major agencies found that the use of nearly every one of the law's nine exemptions to withhold information from the public rose in fiscal year 2009, which ended last October.

Major agencies cited that exemption at least 70,779 times during the 2009 budget year, up from 47,395 times during President George W. Bush's final full budget year, according to annual FOIA reports filed by federal agencies. Obama was president for nine months in the 2009 period.

* TO REITERATE... BUSH 47,395 IN A FULL TWELVE MONTHS; OBAMA 70,779 TIMES IN JUST NINE MONTHS. (*SMIRK*)

In all, major agencies cited that or other FOIA exemptions to refuse information at least 466,872 times in budget year 2009, compared with 312,683 times the previous year, the review found. Agencies often cite more than one exemption when withholding part or all of the material sought in an open-records request.

* AGAIN... BUSH 312,683 IN A FULL TWELVE MONTHS; OBAMA 466,872 IN ONLY NINE MONTHS.

March 16, 2010 at 5:54 PM
William R. Barker said...

http://www.washingtontimes.com/news/2010/mar/16/e-mails-suggested-fort-hood-shooter-subpar-army/

Maj. Nidal Malik Hasan, charged in the Fort Hood shootings, was too fat and "chronically" unprofessional during his psychiatric training, according to internal e-mails exchanged by his superiors.

The communications are the latest in a series of early signs that showed officers had reason to suspend Maj. Hasan's training, and perhaps re-evaluate his suitability as a military physician, but failed to do so.

Yet, his bosses at Walter Reed Army Medical Center in Washington allowed him to complete his residency in 2007, enter an advanced fellowship program, win promotion to major and transfer to Fort Hood, Texas, in 2009.

It was there on Nov. 5, while shouting "God is great," Maj. Hasan fatally shot 13 Army colleagues...

* AND WILL HEADS ROLL...? NO.

The e-mails highlight another point at which the U.S. military government could have intervened to stop Maj. Hasan's career before the shooting. The FBI and other intelligence agencies learned that Maj. Hasan had sent e-mail messages to Anwar al-Awlaki, an al Qaeda-affiliated radical imam in Yemen who urged followers to join the terrorist group and kill Americans.

However, the FBI said in a statement that it dismissed the e-mails as apparently part of Maj. Hasan's work as a psychiatric counselor.

* FOLKS... (*SIGH*)... WHAT THE HELL CAN YOU EVEN SAY TO THAT...???

The bureau did not share the intercepted communications with the military people who could have stopped Maj. Hasan, nor did the FBI question the major.

* NOPE. THIS ISN'T FICTION. THIS IS THE LATEST NEWS REPORTING ON THE INCIDENT.

March 16, 2010 at 6:16 PM
William R. Barker said...

http://www.cbsnews.com/8301-503544_162-20000576-503544.html

The latest posting from the Treasury Department shows the National Debt has increased over $2 trillion since President Obama took office.

The debt now stands at $12.6 trillion. On the day Mr. Obama took office it was $10.6 trillion.

President George W. Bush still holds the record for the most debt run up on his watch: $4.9 trillion. But it took him over four years to rack up the first two trillion dollars in debt. It has taken Mr. Obama 421 days.

* OH... AND BTW... LESS ONE FORGETS... ONE QUARTER OF THE BUSH PRESIDENCY TOOK PLACE WITH DEMOCRATS FIRMLY IN CONTROL OF BOTH THE HOUSE AND SENATE - NANCY PELOSI AND HARRY REID LEADING THE BRANCH OF GOVERNMENT WHICH BY CONSTITUTIONAL MANDATE CONTROLS THE NATION'S PURSE STRINGS.

* ANOTHER POINT... HOW MUCH OF THIS "BUSH SPENDING" DID THEN-SENATOR OBAMA VOTE FOR...??? (*SMIRK*)

* HEY... I HAVE NO PROBLEM BLASTING BUSH OR BLASTING THE RINO CONGRESSES OF 2000-2006, BUT THE SIMPLE TRUTH OF THE MATTER IS THAT SINCE TAKING POWER DEMOCRATS HAVE CONSISTENTLY PUSHED SPENDING UP FAR BEYOND ANYTHING THAT ONE CAN POINT TO IN THE BUSH OR EVEN BUSH/RINO RECORD.

The total debt will amount to more than 100% of the national economy as early as 2012.

* AGAIN... THE DEMS HAVE BEEN RUNNING THE LEGISLATIVE BRANCH SINCE JANUARY 2007 AND THE EXECUTIVE BRANCH SINCE JANUARY 2009.

March 16, 2010 at 6:17 PM
William R. Barker said...

http://online.wsj.com/article/SB10001424052748704131404575117623860083574.html?mod=WSJ_hps_sections_opinion

[President Obama plans] to apply the 2.9% Medicare payroll tax to "unearned income." That's what savings and investment income are called in Washington...

[T]his destructive tax wasn't in either the House or Senate bills, though it may now become law with almost no scrutiny.

For the first time, the combined employer-worker 2.9% Medicare rate would be extended beyond wages to interest, dividends, capital gains, annuities, royalties and rents for individuals with adjusted gross income above $200,000 and joint filers over $250,000.

That would lift the top capital-gains rate to 22.9% as the regular rate bounces back to 20% from 15% when the Bush tax cuts expire at the end of this year. The top rate for dividends would rise to 42.5% when the Bush income-tax rates expire. The White House plan also raises the ordinary Medicare payroll tax by 0.9 percentage points for the same filers, bringing it to 3.8%.

Stephen Entin and colleagues [from the Institute for Research on the Economics of Taxation] estimates that the investment tax would depress GDP by about 1.3% and reduce capital formation by 3.4%, and thus reduce the after-tax incomes of everyone not paying the tax directly in the neighborhood of 1.1% to 1.2%. Labor productivity and wages would fall across the board, while the lost government revenues from the more-sluggish economy would offset the expected receipts.

Earning even a single dollar more than $200,000 in adjusted gross income will slap the 2.9% tax on every dollar of a taxpayer's investment income, creating a huge marginal-rate spike that will most hurt middle-class earners, as opposed to the superrich.

This two-tier tax also fundamentally and probably irrevocably alters the social insurance model that has governed Medicare for more than a half-century. Medicare is supposed to be a universal entitlement with at least some connection between the taxes paid on wages in return for benefits. The investment tax, and the apparatus of ObamaCare financing more generally, severs this link by redirecting Medicare's "dedicated" revenues toward a new entitlement. Even Bill Clinton didn't cross this policy threshold in the health debate of the early 1990s, proposing to fund HillaryCare entirely through new corporate taxes and preserving Medicare as its own discrete program.Senate Democrats rejected Nancy Pelosi's favored 5.4-percentage-point "surcharge" on modified adjusted gross income above $1 million as too radical. But they seem to be fine with its 2.9-percentage-point alter ego, although the Tax Policy Center concludes (on paper) that they'll soak more or less the same people for more or less the same amount.

Earning even a single dollar more than $200,000 in adjusted gross income will slap the 2.9% tax on every dollar of a taxpayer's investment income, creating a huge marginal-rate spike that will most hurt middle-class earners, as opposed to the superrich.

This two-tier tax also fundamentally and probably irrevocably alters the social insurance model that has governed Medicare for more than a half-century. Medicare is supposed to be a universal entitlement with at least some connection between the taxes paid on wages in return for benefits. The investment tax, and the apparatus of ObamaCare financing more generally, severs this link by redirecting Medicare's "dedicated" revenues toward a new entitlement. Even Bill Clinton didn't cross this policy threshold in the health debate of the early 1990s, proposing to fund HillaryCare entirely through new corporate taxes and preserving Medicare as its own discrete program.

March 16, 2010 at 7:47 PM
William R. Barker said...

http://online.wsj.com/article/SB10001424052748703625304575115691871093652.html?mod=WSJ_hps_sections_opinion

[Is it true that] everyone in Massachusetts now has access to "portable, affordable health insurance[?]"

Not exactly.

While Massachusetts' uninsured rate has dropped to around 3%, 68% of the newly insured since 2006 receive coverage that is heavily or completely subsidized by taxpayers. While Mr. Romney insisted that everyone should pay something for coverage, that is not the way his plan has turned out. More than half of the 408,000 newly insured residents pay nothing, according to a February 2010 report by the Massachusetts Health Connector, the state's insurance exchange.

Another 140,000 remained uninsured in 2008 and were either assessed a penalty or exempted from the individual mandate because the state deemed they couldn't afford the premiums.

Mr. Romney's promise that getting everyone covered would force costs down also is far from being realized. One third of state residents polled by Harvard researchers in a study published in "Health Affairs" in 2008 said that their health costs had gone up as a result of the 2006 reforms. A typical family of four today faces total annual health costs of nearly $13,788, the highest in the country. Per capita spending is 27% higher than the national average.

[I]nsurance companies [in Massachusetts] are required to sell "just-in-time" policies even if people wait until they are sick to buy coverage. That's just like the Obama plan. There is growing evidence that many people are gaming the system by purchasing health insurance when they need surgery or other expensive medical care, then dropping it a few months later.

Some Massachusetts safety-net hospitals that treat a disproportionate number of lower-income and uninsured patients are threatening bankruptcy. They still are treating a large number of people without health insurance, but the payments they receive for uncompensated care have been cut under the reform deal.

The Bay State is also suffering from what the Massachusetts Medical Society calls a "critical shortage" of primary-care physicians. As one would expect, expanded insurance has caused an increase in demand for medical services. But there hasn't been a corresponding increase in the number of doctors. As a result, many patients are insured in name only: They have health coverage but can't find a doctor.

Fifty-six percent of Massachusetts internal medicine physicians no longer are accepting new patients, according to a 2009 physician work-force study conducted by the Massachusetts Medical Society. For new patients who do get an appointment with a primary-care doctor, the average waiting time is 44 days, the Medical Society found. Emergency room visits jumped 7% between 2005 and 2007. Officials have determined that half of those added ER visits didn't actually require immediate treatment and could have been dealt with at a doctor's office - if patients could have found one.

Faced with soaring medical expenses, Gov. Deval Patrick, Mr. Romney's successor, wants to cap insurance rate increases at 4.8%, not the 8% to 32% increases the companies have requested for April 1. Three of the four major health insurers in Massachusetts showed operating losses for 2009. If their rates are capped, they say they'll be forced to cut payments to health providers, putting further pressure on doctors and fragile hospitals.

March 16, 2010 at 7:47 PM
William R. Barker said...

http://online.wsj.com/article/SB10001424052748703625304575115970319827934.html?mod=WSJ_Opinion_AboveLEFTTop

Education Secretary Arne Duncan said last week that the Obama Administration will ramp up investigations of civil rights infractions in school districts, which...means in practice...that his Office of Civil Rights (OCR) will revert to the Clinton Administration policy of equating statistical disparity with discrimination, which is troubling.

*"TROUBLING...?!?!" IT'S OUTRIGHT IDIOCY. (SO, YEAH... I GUESS YOU COULD CALL IT "TROUBLING.")

In a speech last week, Mr. Duncan said that "in the last decade" (that's short for the Bush years) "the Office for Civil Rights has not been as vigilant as it should have been in combating racial and gender discrimination." He cited statistics showing that white students are more likely than their black peers to take Advanced Placement classes and less likely to be expelled from school.

The OCR under the Bush Administration rightly focused on reacting to actual complaints of discrimination and issued guidelines to help school districts comply with the law. By contrast, Mr. Duncan plans investigations based on the disparate impact of a school policy, even if no one has alleged any discrimination. Schools and districts that don't have enough blacks taking college prep courses, or don't suspend enough whites for fighting, could face litigation or have federal funding withheld.

(*HEADACHE*)

Inevitably, pressure will be put on districts to get their numbers right and avoid federal scrutiny. Safety is already a major problem in many larger urban schools, where it's not uncommon for students to pass through metal detectors each morning. If districts are afraid to suspend students for fear of an OCR probe, a bad situation is made worse. And if AP classes will now be monitored for racial balance, schools will resort to quotas, lower standards or no longer offer the courses.

* UNFORTUNATELY... SOUNDS LIKE A REASONABLE SUPPOSITION TO ME KNOWING THE WAY BUREAUCRACIES WORK.

Roger Clegg of the Center for Equal Opportunity also notes that Mr. Duncan's disparate impact approach to civil rights enforcement may be constitutionally suspect. In a 2001 Supreme Court decision, Alexander v. Sandoval, the Court reaffirmed that Title VI prohibits only disparate treatment and not disparate impact. "There's no statutory basis for this," says Mr. Clegg.

* THERE GO THOSE "CRAZY" CONSERVATIVES AGAIN... "UNREASONABLY" DEMANDING FEDERAL AUTHORITIES RESPECT THE CONSTITUTION. (*SMIRK*)

Mr. Duncan does minorities no favors by suggesting that racist policies are causing the achievement gap while ignoring the impact of culture, family structure or failing schools. He would do better to focus his department's energies on improving educational choice, promoting performance-based pay for teachers and other reforms.

* AGREED.

March 16, 2010 at 7:48 PM
William R. Barker said...

http://online.wsj.com/article/SB10001424052748703909804575123470465841424.html

To uncover what is wrong with American public schools one has to dig deeper than...recent developments in education. One needs to consider the impact of restrictive collective bargaining agreements that prevent rewarding good teachers and removing ineffective ones, intrusive court interventions, and useless teacher certification laws.

Charters were invented to address these problems. As compared to district schools, they have numerous advantages. They are funded by governments, but they operate independently. This means that charters must persuade parents to select them instead of a neighborhood district school. That has happened with such regularity that today there are 350,000 families on charter-school waiting lists, enough to fill over 1,000 additional charter schools.

Among African Americans, those who favor charters outnumber opponents four to one.

Even among public-school teachers, the percentage who favor charters is 37%, while the percentage who oppose them is 31%.

* AND WOULDN'T IT BE INTERESTING TO LOOK INTO WHAT PERCENTAGE OF THE 31% OF TEACHER WHO INDICATE PERSONAL OPPOSITION SEND/SENT THEIR OWN CHILDREN TO PRIVATE SCHOOLS... (*SMILE*)

Union leaders would have us believe that charter popularity is due to the "motivated" students who attend them, not the education they provide. But charters hold lotteries when applications exceed available seats. As a result - and also because they are usually located in urban areas - over half of all charter students are either African American or Hispanic.

To identify the effects of a charter education, a wide variety of studies have been conducted. The best studies are randomized experiments, the gold standard in both medical and educational research. Stanford University's Caroline Hoxby and Harvard University's Thomas Kane have conducted randomized experiments that compare students who win a charter lottery with those who applied but were not given a seat. Winners and losers can be assumed to be equally motivated because they both tried to go to a charter school. Ms. Hoxby and Mr. Kane have found that lottery winners subsequently scored considerably higher on math and reading tests than did applicants who remained in district schools.

In another good study, the RAND Corp. found that charter high school graduation rates and college attendance rates were better than regular district school rates by 15 percentage points and eight percentage points respectively.

March 16, 2010 at 7:48 PM
William R. Barker said...

http://www.investors.com/NewsAndAnalysis/Article.aspx?id=527490

The latest data show a record number of people with no tax obligation.

We also have the highest-earning nontaxpayers ever.

A record number of the 142 million tax returns filed in 2008 resulted in no taxes owed, according to the Tax Foundation's analysis of the latest IRS data. About 51.6 million returns, or 36.3%, were filed by those whose deductions, exemptions and tax credits wiped out any federal income-tax obligation.

* THIS IS INSANE. THIS IS NOT WHAT THE FOUNDERS INTENDED. THIS IS NOT "FAIRNESS" - IT IS THE OPPOSITE OF FAIRNESS!

These aren't people who have overpaid their taxes or had so much withheld from their paychecks that they'll get refunds. ... These are people who pay no [federal income] taxes at all.

There's been a 59% increase in the number of nonpayers since 2000, growing from 32.6 million in 2000 to 51.6 million in 2008. In the same period, the total tax filers grew by only 10%.

* AND PART OF THIS IS BECAUSE OF BUSH, WHO WAS/IS A "PROGRESSIVE" REPUBLICAN.

Not only are fewer people paying any taxes, but also the income levels for these nonpayers have steadily risen. A family of four earning more than $50,000 can have no income tax liability after taking the standard deduction and the child tax credit. (According to the Tax Foundation, "The major elements of the Economic Stimulus Act of 2008 boosted the maximum income for nonpayers to more than $56,700" - the highest ever.)

The government has continually expanded the value of benefits such as the earned income tax credit to the point where you get a check from Uncle Sam even if you paid no taxes during the year. The tax code was originally intended to raise sufficient revenues to pay for the essential functions of government. It has morphed into a tool for social engineering, to incentivize or even punish certain behavior, and even to redistribute wealth.

"Nonpaying status used to be a sure sign of poverty," says Tax Foundation President Scott Hodge. "But thanks to increased use of the tax code to deliver social benefits, incentivize behaviors and funnel money to targeted groups, middle-class families have now been pulled into the growing pool of nonpayers. We're now in a situation where a record number of tax filers are completely disconnected from the cost of government."

This is a dangerous trend. The increase in the number of people who pay no taxes mirrors the increase in those receiving benefits from the federal government. This creates a bias toward more spending and against keeping tax rates low, since that burden is increasingly being borne by those at the high end of the income scale - the entrepreneurs, risk takers and small- business men who create most of the jobs.

When you have more people riding the wagon than pulling it, the wagon tends to break down. No amount of stimulus money extracted from those who do pay taxes will fix the wagon and get it moving again. We have created too many ways to ride the wagon and not enough reasons to pull it.

March 16, 2010 at 8:37 PM
William R. Barker said...

* TWO PARTER! (Part 1 of 2)

http://article.nationalreview.com/428042/losing-the-war/robert-rectorhttp://article.nationalreview.com/428042/losing-the-war/robert-rector

Today marks the 46th anniversary of the War on Poverty. On March 16, 1964, Pres. Lyndon Johnson announced a new government mobilization that he claimed would yield “total victory” against poverty in the United States. Johnson promised his “war” would be an “investment” that would “return its cost manifold to the entire economy.”

The War on Poverty sparked an astonishing growth in what is called “means-tested” welfare - that is, programs targeted exclusively toward poor and low-income Americans.

The means-tested welfare system today comprises more than 70 federal programs, including food stamps, public housing, the Earned Income Tax Credit, and Medicaid.

These welfare programs are funded not only by the federal government but also by state governments’ payments into federal programs. Prior to the current recession, $1 out of every $7 in total federal, state, and local government spending went to means-tested welfare.

Means-tested welfare spending has grown enormously since President Johnson’s day. After adjusting for inflation, welfare spending today is 13 times greater than it was then. Means-tested welfare spending was 1.2% of the gross domestic product (GDP) in 1964; by 2008, it had reached 5% of GDP.

President Obama plans to sharply accelerate the growth in welfare spending.

In FY2007, total government spending on means-tested welfare was a record-high $657 billion. By FY2011, total government spending on means-tested aid will rise to $953 billion, nearly a 50% increase in four years.

Obama’s spending increases are not merely temporary responses to the current recession. Most are permanent expansions of the welfare state. According to the long-term spending plans set forth in Obama’s FY2010 budget, combined federal and state spending will not drop significantly after the recession ends.

[I]n terms of reducing the “causes” rather than the “consequences” of poverty, the War on Poverty has failed utterly. In fact, a significant portion of the population is now less capable of prosperous self-sufficiency than it was before.in terms of reducing the “causes” rather than the “consequences” of poverty, the War on Poverty has failed utterly. In fact, a significant portion of the population is now less capable of prosperous self-sufficiency than it was before.

* To be continued...

March 16, 2010 at 11:13 PM
William R. Barker said...

* CONTINUING... (Part 2 of 2)

A major element in the declining capacity for self-support is the collapse of marriage in low-income communities. As the War on Poverty expanded benefits, welfare began to serve as a substitute for a husband in the home, and low-income marriage began to disappear. When Johnson launched the War on Poverty, 7% of American children were born out of wedlock. Today the number is 39%.

As husbands left the home, the need for more welfare to support single mothers increased. The War on Poverty created a destructive feedback loop: Welfare promoted the decline of marriage, which generated the need for more welfare. Today, out-of-wedlock childbearing and the resulting growth of single-parent homes are the most important causes of child poverty. If the poor women who give birth out of wedlock married the fathers of their children, two-thirds would immediately be lifted out of poverty.As husbands left the home, the need for more welfare to support single mothers increased. The War on Poverty created a destructive feedback loop: Welfare promoted the decline of marriage, which generated the need for more welfare. Today, out-of-wedlock childbearing and the resulting growth of single-parent homes are the most important causes of child poverty. If the poor women who give birth out of wedlock married the fathers of their children, two-thirds would immediately be lifted out of poverty.

(Out-of-wedlock childbearing isn’t the same as teen pregnancy; the bulk of non-marital births occur to young adult women with low education levels, while only 7 percent occur to teenagers in high school.)

The second major cause of child poverty is parents’ lack of work. Even in good economic times, the average poor family with children has only 800 hours of work per year. This is the equivalent of one adult working 16 hours per week. The math is fairly simple: Little work equals little income equals poverty. If one adult in each poor family worked full-time through the year, the poverty rate among these families would drop by two-thirds.

Welfare reform in the mid-1990s focused attention, very briefly, on work. Federal work requirements were established in the Temporary Assistance to Needy Families (TANF) program, which replaced the Aid to Families with Dependent Children program. The new rules required a portion of able-bodied TANF recipients to work or prepare for work... But welfare reform was always more limited than the public understood. Work requirements were established in only one of 70 means-tested programs, and even in the TANF program, many recipients were unaffected. Moreover, due to technicalities in the construction of the law, the federal work standards, which had driven the caseload reduction, lost force by around 2000. In the subsequent years, liberals in the Senate tenaciously blocked the reinstatement of federal work standards. In the absence of external pressure, most state welfare bureaucracies lapsed into their traditional role as check-writing agencies. Always limited, welfare reform is today comatose - and Congress is energetically, but quietly, seeking to pull the plug.

The current goal in welfare is simply to “spread the wealth” for its own sake. The War on Poverty has become a system of permanent income redistribution, which will only increase over time.

According to President Obama’s budget projections, federal and state welfare spending will total $10.3 trillion over the next ten years. This spending will cost more than $100,000 for each taxpaying household in the U.S. Most of it will be funded by borrowing from future generations and foreign nations.

This spending is unsustainable.

March 16, 2010 at 11:14 PM
William R. Barker said...

http://article.nationalreview.com/428116/updating-the-price-tag/deroy-murdock

Last November 18, the Congressional Budget Office scored the Senate’s Obamacare bill at $849 billion for the ten years from 2010 to 2019.

That was November [2009]. This is March [2010].

Because a new year has dawned since 2009’s CBO score, Congress really should see a new cost estimate for the next ten-year period - 2011 to 2020 - before it votes again.

* DOES ANYONE DISAGREE...???

[T]he Democrats who run the House have neglected to present a new score on the Senate bill that they want to adopt as the first step in the reconciliation process that supposedly will correct several of the more egregious glitches and corrupt deals that Senate Majority Leader Harry Reid (D-NV) employed to grease his bill through "The World’s Greatest Deliberative Body."

(*SMIRK*)

While there would be little Obamacare spending in the lost year, 2010, the year 2020 would have lots of expenditures, should Obamacare become law and then be fully implemented. If 2020’s spending simply equals 2019’s $130 billion in anticipated outlays, this would seem to push last year’s CBO score from $849 billion to a hefty $979 billion. This is heart-stoppingly close to $1 trillion, and far higher than the “fiscally prudent” $900 billion threshold below which Democrats have tried to keep Obamacare’s official cost.

Pro-Obamacare Democrats most likely will not ask CBO a question whose answer they prefer not to hear. A new CBO score that shows costs shooting through the Capitol Dome will send moderate and otherwise-wavering Democrats diving for cover. Pelosi’s vote-counting arithmetic suddenly will become trigonometry.

So, it falls upon congressional Republicans to call on CBO to issue a new score. Republicans should do this immediately and repeatedly until CBO gets this done.

Whether one believes Obamacare belongs in the U.S. Code or on the ash heap of history, Americans deserve to have members of Congress vote on this momentous measure with a clear understanding of what it costs - not yesterday, but today.

March 16, 2010 at 11:14 PM
William R. Barker said...

http://article.nationalreview.com/428027/talking-points-vs-realities/thomas-sowell

In a swindle that would make Bernie Madoff look like an amateur, Barack Obama has gotten a substantial segment of the population to believe that he can add millions of people to the government-insured rolls without increasing the already record-breaking federal deficit.

Those who think in terms of talking points, instead of realities, can point to the fact that the Congressional Budget Office has concurred with budget numbers that the Obama administration has presented.

Anyone who is so old-fashioned as to stop and think, instead of being swept along by rhetoric, can understand that a budget - any budget - is not a record of hard facts but a projection of future financial plans. A budget tells us what will happen if everything works out according to plan.

The Congressional Budget Office can only deal with the numbers that Congress supplies. Those numbers may well be consistent with each other, even if they are wholly inconsistent with anything that is likely to happen in the real world.

The Obama health-care plan can be financed without increasing the federal deficit - if the administration takes hundreds of billions of dollars from Medicare. But Medicare itself does not have enough money to pay its own way over time.

However money is juggled in the short run, the government’s financial liabilities are increased by adding this huge new entitlement of government-provided insurance. The fact that these new financial liabilities can be kept out of the official federal deficit projection, by claiming that they will be paid for with money taken from Medicare, changes nothing in the real world.

In real life, you can’t get blood from a turnip, and you can’t keep on getting money from a Medicare program that is itself running out of money.

An even more transparent gimmick is collecting money for the new Obama health-care program for the first ten years but delaying the payments of its benefits for four years. By collecting money for ten years and spending it for only six years, you can make the program look self-supporting, but only on paper and only in the short run.

This is a game you can play just once, during the first decade. After that, you are going to be collecting money for ten years and paying out money for ten years.

Fraud has been at the heart of this medical-care takeover plan from Day One. The succession of wholly arbitrary deadlines for rushing this massive legislation through, before anyone has time to read it all, serves no other purpose than to keep its specifics from being scrutinized - or even recognized - before it becomes a fait accompli and “the law of the land.”

March 16, 2010 at 11:15 PM
William R. Barker said...

http://money.cnn.com/2010/03/15/news/international/greece_debt.fortune/index.htm

The term PIIGS has been coined to refer collectively to Portugal, Italy, Ireland, Greece, and Spain. Aside from being a cute acronym, the term describes the actions of these countries very aptly as they have acted "piggish" in issuing debt to support overzealous government budgets.

While the American media has at times made light of these countries and their PIIGS moniker, the same mistakes are at play in creating domestic pigs; the United States is feeding from the same trough.

There are two key ratios used to highlight when a government is reaching the crisis zone of fiscal imbalance: the debt-to-GDP ratio and deficit-as-a-percentage-of-GDP. Historically, a debt-to-GDP of north of 90% and a deficit-as-a-percentage-of-GDP north of 10% have been the lines in the sand to watch. As governments cross these barriers, they enter the Pig Zone.

The Greek leaders have managed their nation to a debt-to-GDP ratio north of 110% and deficit-as-a-percentage-of-GDP that exceeds 12.7%.

[T]he United States is running a debt-to-GDP ratio of 84% and deficit-to-GDP of almost 11%.

The United States last defaulted on debt in 1933 by refusing to repay certain bonds in gold as promised. While we are not suggesting that a U.S. debt default is anywhere near imminent, the ratios outlined above are concerning and do place our federal government squarely in the Pig Zone.

[D]ig into fiscal imbalances at the state level and the picture gets even worse. According to a recent study by the Pew Center, a nonpartisan think tank, there is a $1 trillion gap between $3.35 trillion in pension, health care, and other retirement obligations on state balance sheets versus the $2.35 trillion in assets to cover them. This is a massive future budgetary gap, which will have to be funded, at least partially, by debt.

[A]n estimated 41 state pension programs are less than 10% funded. [O]nly 5% of the $587 billion liability for current and future retiree health care and other non-pension benefits is currently funded.

to deal with massive deficits, totaling approximately $290 billion, many states have tapped into their rainy day funds in fiscal 2009 and 2010... [S]everal states have dried up their funds to balance their current budgets, including Alabama, Arizona, California, Connecticut, Maine, New Jersey, Ohio, Oklahoma, and Pennsylvania.

Many municipal bond funds continue to assume historically low default rates. As we dig into state-level finances, the facts suggest a different future. Astute investors have already begun selling municipal bonds. As Warren Buffett recently stated, insuring municipal bonds "has the look of a dangerous business."

[Recall,] in the 1930s municipal bonds in the United States defaulted at a rate of more than 30%.

March 17, 2010 at 12:07 AM
William R. Barker said...

http://www.usatoday.com/news/washington/2010-03-15-campaign-cash_N.htm

After announcing plans to leave the House of Representatives, Florida Democrat Robert Wexler went on to spend more than $340,000 of his campaign funds on staff bonuses, airline tickets and other expenses.

Ohio Republican Sen. George Voinovich, meanwhile, announced his retirement plans in January 2009, but spent more than $300,000 in campaign cash last year, paying for everything from catering to car maintenance.

Former senator Mel Martinez spent more than $116,000 on consultants, airline fares, meals and other expenses after announcing plans in December 2008 to leave Congress, including a bill of more than $2,500 at a Washington sports bar.

Federal law bars members of Congress from using donors' contributions to their main campaign accounts for personal expenses. But it allows lawmakers broad latitude on other expenses, from restaurant bills, parking fees and flowers, if the spending is related to official or political duties.

Watchdogs, such as Sheila Krumholz of the non-partisan Center for Responsive Politics, say the spending by outgoing lawmakers raises questions about whether it is an appropriate use of donors' money.

"They are going to nice restaurants and spending more money on more things that are not strictly campaign expenses," said Krumholz, whose organization tracks money in politics. "Some of these expenditures are tantamount to personal use."

March 17, 2010 at 12:08 AM
William R. Barker said...

http://www.signonsandiego.com/news/2010/mar/15/questions-for-davis-filner/

[T]wo promises that President Barack Obama has made over and over in his push for health care reform[:]

The first promise is that if you like your present doctor and health coverage, you don’t have to worry because they wouldn’t be affected.

The second promise is that the health care overhaul wouldn’t make the already-immense budget deficit even bigger.

[T]he bill fails on both fronts.

The idea that it wouldn’t affect anyone’s existing coverage is simply not true. Government mandates would be phased in that would significantly expand what conditions and treatments insurers must cover and provide. At the state level, much less sweeping mandates have driven up premium costs sharply.

Another factor that has barely been debated is also sure to inflate premium costs. The Senate bill would require insurers to cover anyone, whatever their pre-existing conditions. But because the annual fine for refusing to buy health insurance is only up to $750 or 2 percent of income, whichever is greater, millions of Americans would pass on coverage, aware they could readily get insurance if facing a major medical problem. This “free riding” means honest citizens would have to pick up the tab for those who game the system.

Unless, that is, the federal government just pays the tab by printing more money – a distinct possibility.

Which brings us to Obama’s second promise: that the Senate bill wouldn’t add to the federal government’s deficit and debt nightmare. No less than CIA Director Leon Panetta warns that the imbalance between spending and revenue is so severe it amounts to a threat to national security.

The assertion that the $875 billion Senate bill would actually save money over the next decade falls apart upon the slightest inspection. The alleged 10-year surplus is a paper fiction created by the fact that funding would accumulate for years before significant program costs began. And more than half the funding – $483 billion – is allegedly going to come from reduced spending on Medicare and related programs. Nothing in lawmakers’ history on entitlement spending – they just raised Social Security checks higher than required by funding formulas – indicates the Medicare reductions would ever happen.

So not only is the Senate bill deeply flawed, it is built on myths.

March 17, 2010 at 12:08 AM
William R. Barker said...

http://blog.american.com/?p=11423

Few have noticed that Senator Chris Dodd does not claim that his bill ends “too big to fail” as most people understand that idea.

What he says is that it ends “the possibility that taxpayers will be asked to write a check to bail out financial firms that threaten the economy.”

That’s far from ending TBTF.

In reality, his proposal makes TBTF national policy. It does this by authorizing the Fed to regulate and supervise the largest financial institutions in the United States, and authorizing a new entity called the Financial Stability Oversight Council to add financial firms to the Fed’s list if - and this is key - they “pose a risk to the financial stability of the United States.”

What do these words mean?

Obviously, they mean that the firms so designated are too big to fail.

The real cost of TBTF is an enormous cost to the economy in general, as creditors preferentially lend to companies that are TBTF rather than to smaller companies that are not TBTF and will be sent to ordinary bankruptcy if they fail.

This is exactly what happened with Fannie Mae and Freddie Mac. They were seen as backed by the government, and with the lower cost of funds they received were able to drive all competition out of their markets and take exorbitant risks.

The result of Dodd’s bill will be the same - to create Fannies and Freddies in every sector of our economy where these TBTF firms are designated, destroying competition and forcing consolidations over time.

March 17, 2010 at 12:08 AM

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