Tuesday, April 5, 2011

Barker's Newsbites: Tuesday, April 5, 2011


I feel a sermon comin' on me...!
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6 comments:

William R. Barker said...

* TWO-PARTER... (Part 1 of 2)

http://online.wsj.com/article/SB10001424052748703806304576242612172357504.html

* BY CONGRESSMAN PAUL RYAN (R-WI), CHAIRMAN OF THE HOUSE BUDGET COMMITTEE

Congress is currently embroiled in a funding fight over how much to spend on less than one-fifth of the federal budget for the next six months.

* YEP. UNDERSTAND THIS. "LESS THAN ONE-FIFTH OF THE FEDERAL BUDGET FOR THE NEXT SIX MONTHS." (SO WE'RE TALKING LESS THAN ONE-TENTH OF THE FEDERAL BUDGET FOR THE NEXT FULL YEAR!)

Whether we cut $33 billion or $61 billion - that is, whether we shave 2% or 4% off of this year's deficit - is important.

* BUT IMPORTANT ONLY IN THE SENSE OF SETTING A TONE. CUTTING 2% EVEN 4% OUT OF THIS YEAR'S DEFICIT IS BUT A HANDSHAKE WITH THE AMERICAN PEOPLE INDICATING A CONCEPTUAL AGREEMENT HAS BEEN REACHED.

[T]his morning the new House Republican majority will introduce a budget that moves the debate from billions in spending cuts to trillions.

(*CLAP-CLAP-CLAP*)

America is facing a defining moment. The threat posed by our monumental debt will damage our country in profound ways, unless we act.

(*NOD*)

No one person or party is responsible for the looming crisis.

* LITERALLY TRUE... BUT ULTIMATELY MISLEADING. WHILE THE REPUBLICAN ESTABLISHMENT BEARS A GREAT DEAL OF THE RESPONSIBILITY FOR THE SHAPE WE'RE NOW IN, THE DEGREE TO WHICH OBAMA, PELOSI, AND REID ACCELERATED OUR NATIONAL RUN OVER THE CLIFF TOWARDS FISCAL DISASTER CAN'T BE UNDERSTATED. NOR SHOULD IT BE!

Since President Obama took office, our problems have gotten worse. Major spending increases have failed to deliver promised jobs. The safety net for the poor is coming apart at the seams. Government health and retirement programs are growing at unsustainable rates. The new health-care law is a fiscal train wreck. And a complex, inefficient tax code is holding back American families and businesses.

* BUT IT GETS WORSE...!!!

The president's recent budget proposal would accelerate America's descent into a debt crisis. It doubles debt held by the public by the end of his first term and triples it by 2021. It imposes $1.5 trillion in new taxes, with spending that never falls below 23% of the economy. His budget permanently enlarges the size of government. It offers no reforms to save government health and retirement programs, and no leadership.

* YEP. THAT PRETTY MUCH COVERS IT. FOR ALL INTENTS AND PURPOSES BARAK OBAMA IS THE FUNCTIONAL EQUIVALENT OF A EUROPEAN SOCIALIST. OBAMA WANTS TO FUNDAMENTALLY CHANGE AMERICA... AND BY "CHANGE" HE MEANS HE FAVORS OUTDOING FDR AND LBJ IN TERMS OF CHANGING AMERICA INTO A WELFARE STATE.

* To be continued...

April 5, 2011 at 12:05 PM
William R. Barker said...

* CONTINUING... (Part 2 of 2)

Our [Republican] budget, which we call The Path to Prosperity, is very different. For starters, it cuts $6.2 trillion in spending from the president's budget over the next 10 years...

* LET'S JUST STICK TO TWO YEARS AT A TIME, MR. CHAIRMAN. (*SMIRK*)

Our proposal brings federal spending to below 20% of gross domestic product (GDP), consistent with the postwar average, and reduces deficits by $4.4 trillion.

* ALL WELL AND GOOD, BUT AGAIN, I WANT TO SEE IMMEDIATE RESULTS - NOT PROMISES FOR WHAT MAY BE TEN YEARS DOWN THE ROAD IF EVERYTHING GOES "ACCORDING TO PLAN."

A study just released by the Heritage Center for Data Analysis projects that The Path to Prosperity will help create nearly one million new private-sector jobs next year...

* BETTER. "NEXT YEAR." STILL... REID CONTROLS THE SENATE... OBAMA IS PRESIDENT... I SEE A FEW... er... "POTENTIAL" PROBLEMS AHEAD.

This budget proposes to bring spending on domestic government agencies to below 2008 levels, and it freezes this category of spending for five years.

* ONE MORE TIME, RYAN - EACH CONGRESS LASTS FOR TWO YEARS. NOT TEN YEARS. NOT FIVE YEARS. TWO YEARS.

This budget will build upon the historic welfare reforms of the late 1990s by converting the federal share of Medicaid spending into a block grant that lets states create a range of options and gives Medicaid patients access to better care. It proposes similar reforms to the food-stamp program, ending the flawed incentive structure that rewards states for adding to the rolls.

* WOULDN'T IT MAKE MORE SENSE TO SIMPLY ALLOW THE STATES TO RETAIN MORE OF THEIR OWN CITIZEN'S TAX PAYMENTS AND USE THEM AS THEY SEE FIT? WHY MUST MONEY GO TO WASHINGTON ONLY TO BE "RETURNED" - MINUS "EXPENSES" - TO THE STATES?

Starting in 2022...

* ARE YOU FUCKING KIDDING ME...?!?! ARE YOU FUCKING KIDDING ME...?!?!

* FOLKS... STAY TUNED... AS YOU CAN SEE, I HAVE MY DOUBTS.

* SO MUCH FOR "ACCENTUATING" THE POSITIVE.

(*SMIRK*)

April 5, 2011 at 12:06 PM
William R. Barker said...

http://cfif.org/v/index.php/commentary/44-energy-and-environment/946-running-on-empty-with-a-full-tank-the-incoherence-of-obamas-energy-policies

As Americans watch skyrocketing gasoline prices...frustrate their hopes for economic recovery, they should be outraged by a new report on America’s energy resources from the Congressional Research Service. The report shows that the United States is sitting on the largest batch of energy resources on the planet. In fact, these vital fuel sources add up to more than the resources of energy-rich Saudi Arabia, China and Canada combined.

At every turn, the report’s pages reveal a plethora of untapped resources.

(http://epw.senate.gov/public/index.cfm?FuseAction=Files.View&FileStore_id=04212e22-c1b3-41f2-b0ba-0da5eaead952)

We have enough oil to replace our imports from the Middle East for 50 years. We have enough domestic natural gas for about 100 years. And we have enough recoverable coal to power the nation for at least two centuries. (And none of those statistics factor in the increased efficiencies that could allow future generations of Americans to do more with less of these copious fuel sources.)

The problem, of course, is that the Obama Administration and its allies throughout the Democratic Party and the alternative energy industry deride these existing resources as remnants of a crude industrial era. Instead, they hasten us to a future powered by faddish innovations in technologies like solar and wind power. And they attempt to sweeten the pot by invoking the revolution in “green jobs” that will accompany this economic and environmental transformation.

Unfortunately, this revolution has not been forthcoming.

* NOR WILL IT BE!

Despite decades of government support and billions of dollars in wasted taxpayer money, alternative energy remains a boutique pipe dream. And the experience of nations like Spain and Britain - which have pursued green jobs agendas in earnest - show that these initiatives inevitably end up destroying more jobs than are created.

The economics at work are elementary. Without a method for making alternative energy affordable in the free market, liberals are reduced to coercion. That means subsidizing the inefficient alternative fuels with taxpayer money, artificially raising the price of fuel sources that actually work, or both.

It doesn’t take a doctorate to realize that this is a recipe for lower quality, higher costs and economic decline.

Rather than embrace the tremendous resources that literally lie at our feet, the Obama Administration is instead soldiering on with its quixotic promotion of costly and unworkable alternatives. ... In the meantime, America’s economy is needlessly running on empty.

April 5, 2011 at 12:51 PM
William R. Barker said...

http://online.wsj.com/article/SB10001424052748703712504576233053869526920.html?mod=WSJ_Opinion_AboveLEFTTop

[Republican] Senator Tom Coburn of Oklahoma has a fighting chance to begin reforming Washington's bonehead ethanol policy.

Mr. Coburn is collecting votes to take down the Volumetric Ethanol Excise Tax Credit, which ladles out roughly $5 billion a year in benefits to petroleum refiners that blend ethanol into gasoline.

(*THUMBS UP*)

U.S. producers [also] benefit from a 54-cent a gallon tariff on foreign ethanol from the likes of Brazil.

* AND THIS TOO SHOULD BE ELIMINATED.

They also enjoy a federal mandate that requires the production of 13.95 billion gallons of alternative fuels this year, and 36 billion gallons by 2022.

* AND THIS MANDATE SHOULD BE REMOVED!

Farm state Senators led by Iowa's Chuck Grassley are naturally doing their best to beat the Coburn amendment, which has been gaining support on the left and right. So it's unfortunate, and more than a little odd, to see Mr. Grassley invoking none other than Grover Norquist's Americans for Tax Reform as an ally in accusing Mr. Coburn of promoting a "tax increase."

* DISGUSTING. GRASSLEY PUTS NARROW, SHORT-SIGHTED PAROCHIAL INTERESTS AHEAD OF THE NATIONAL INTEREST.

We understand the larger principle that Americans for Tax Reform is trying to defend. Axing every credit, exemption and deduction in the tax code, while leaving tax rates high, would result in a higher general tax burden and more money for Washington to spend. A true tax reform would trade such tax loopholes and subsidies for lower rates.

* TRUE...

But the compelling taxpayer interest in this case is to begin to dismantle the failed policy that is driving up the cost of food and fuel with no benefit for the environment or U.S. energy security.

* EXACTLY RIGHT! ECONOMIC THEORY MUST GIVE WAY TO ECONOMIC REALITY!

Says Mr. Coburn: "Continuing to issue blanket defenses of all tax expenditures is a profoundly misguided embrace of progressive, activist government and a strategy for tax complexity, tax deferment, excessive spending and unsustainable deficits."

(*NOD*)

April 5, 2011 at 4:58 PM
William R. Barker said...

* TWO-PARTER... (Part 1 of 2)

http://www.nationalreview.com/articles/263837/political-statistics-thomas-sowell

* THE GREAT THOMAS SOWELL - BRILLIANCE PERSONIFIED!

When someone gives you a check and the bank informs you that there are insufficient funds, whom do you get mad at?

In your own life, you get mad at the guy who gave you the check that bounced, not at the bank. But, in politics, you get mad at whoever tells you that there is no money.

One of the secrets of the growth of the welfare state is that politicians get a lot of mileage out of making promises, without setting aside enough money to fulfill those promises.

When Congress votes for all sorts of benefits - without voting for enough taxes to pay for them - they get the support of those who have been promised the benefits, without getting grief from the taxpayers. It’s strictly win-win as far as the welfare-state politicians are concerned. But it is strictly lose-lose, big-time, for the country, as deficits skyrocket.

Anyone who says that we don’t have the money to pay what was promised is accused of trying to destroy Social Security, Medicare, or Obamacare - or whatever other unfunded promises have been made. It is like blaming the bank for saying that the check bounced.

It is the same story at the state level as in Washington. The lavish pensions promised to members of public-sector unions cannot continue to be paid because the money is just not there. But whom are the unions mad at? Those who say the money is not there.

How far short are the states? It varies from one state to another. It also varies with how large a rate of return the state gets on its investments with the inadequate amount of money that has been set aside to cover its promised pensions.

A front-page story in the March 28th issue of Investor’s Business Daily showed plainly, with bar graphs, how big Florida’s shortfall is under various rates of return on that state’s investments.

Florida’s own estimate of its pension fund’s shortfall is based on the assumption that they will receive a rate of return of 7.75%.

But what if it turns out that they don’t get that high a return?

A 6% rate of return would more than triple the size of Florida’s unfunded liability for its employees’ pensions.

The actual rate of return that Florida has received over the past decade has been only 2.6%. In other words, by simply assuming a far higher future rate of return on their investments than they have received in the past, Florida politicians can deceive the public as to how deep a hole the state’s finances are in.

* To be continued...

April 5, 2011 at 7:56 PM
William R. Barker said...

* CONTINUING... (Part 2 of 2)

Political games such as these are not confined to Florida.

State budgets and federal budgets are not records of facts. They are projections based on assumptions. Just by manipulating a few assumptions, politicians can create a scenario that bears no resemblance to reality.

The “savings” to be made by instituting ObamaCare is a product of this kind of manipulation of assumptions.

Even when the people who turn out the budget projections do an honest job, they are working with the assumptions given to them by the politicians.

The fact that the end results carry the imprimatur of the Congressional Budget Office - or of some comparable state agency or reputable private accounting firm - means absolutely nothing.

When Florida arbitrarily assumes that it is going to get a future rate of return on its pension-fund investment that is roughly three times what its past returns have been, that is the same nonsense as when the feds assume that Congress will cut half a billion dollars out of Medicare to finance ObamaCare.

We would probably be better off if there were no Congressional Budget Office to lend its credibility to data based on hopelessly unrealistic assumptions fed to them by politicians.

One of the reasons why a federal “balanced budget” amendment is unlikely to do what many of its advocates claim is that a budget is just a plan for the future. It does not have to bear any resemblance to the realities of either the past or the future.

We do not need reassurances that do not reassure, whether these reassurances are in numbers or in words. No small part of the reason for the economic collapse we have been through is that federally designated rating agencies reassured investors that many mortgage-backed securities were safe, when they were not.

Not only investors, but the whole economy, would have been better off without these reassurances. “Caveat emptor” would be better advice for both investors and voters.

April 5, 2011 at 7:57 PM

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