budget - Fausta's Blog

March 17, 2013 By Fausta

“It could never happen here”?

Tomorrow all bank deposits over €100,000 will have 10% expropriated in Cyprus, while

Goat herders, taxi drivers, et al. (what the New York Times calls“pensioners, workers and regulator depositors”) with less than €100,000 get whacked 6.75 percent.

What do they get for that? A €10 billion bailout from the International Monetary Fund and European lenders.

Roger Kimball has the story.

In Ireland, Hungary, Poland, Bulgaria and France, the governments take over citizens’ pension money to make up government budget shortfalls.

In 2008, Ambrose Evans-Pritchard asked, Argentina seizes pension funds to pay debts. Who’s next?

My fear is that governments in the US, Britain, and Europe will display similar reflexes. Indeed, they have already done so. The forced-feeding of banks with fresh capital – whether they want it or not – and the seizure of the Fannie/Freddie mortgage giants before they were in fact in trouble (in order to prevent a Chinese buying strike of US bonds and prevent a spike in US mortgage rates), shows that private property can be co-opted – or eliminated – with little due process if that is required to serve the collective welfare. This is a slippery slope.

This is only the beginning, folks.

March 1, 2013 By Fausta

Sequestration, schmequestration

Dr. Krauthammer‘s on the case, on TV:

and here: Hail Armageddon

The Obama administration has every incentive to make the sky fall, lest we suffer that terrible calamity — cuts the nation survives. Are they threatening to pare back consultants, conferences, travel and other nonessential fluff? Hardly. It shall be air-traffic control. Meat inspection. Weather forecasting.

A 2011 Government Accountability Office report gave a sampling of the vastness of what could be cut, consolidated and rationalized in Washington: 44 overlapping job training programs, 18 for nutrition assistance, 82 (!) on teacher quality, 56 dealing with financial literacy, more than 20 for homelessness, etc. Total annual cost: $100 billion-$200 billion, about two to five times the entire domestic sequester.

Are these on the chopping block? No sir. It’s firemen first. That’s the phrase coined in 1976 by legendary Washington Monthly editor Charlie Peters to describe the way government functionaries beat back budget cuts. Dare suggest a nick in the city budget, and the mayor immediately shuts down the firehouse. The DMV back office, stacked with nepotistic incompetents, remains intact. Shrink it and no one would notice. Sell the firetruck — the people scream and the city council falls silent about any future cuts.

After all, the sequester is just one-half of 1 percent of GDP. It amounts to 1.4 cents on the dollar of nondefense spending, 2 cents overall.

Because of this year’s payroll tax increase, millions of American workers have had to tighten their belts by precisely 2 percent. They found a way. Washington, spending $3.8 trillion, cannot? If so, we might as well declare bankruptcy now and save the attorneys’ fees.

Obama was counting on the sequester, make no mistake.

February 28, 2013 By Fausta

What was Woodward’s sin?

Ace:

Woodward’s sin was exposing “big whoppers” the Administration told on the sequester.

There are several lies Woodward has exposed:

1. Obama, despite the media blitz to blame the GOP, actually conceived of and proposed the sequester.

2. Obama, despite now claiming that tax increases must be part of the deal to avoid the sequester, agreed last year that only spending cuts would constitute the plan to avoid the sequester. Thus, he’s “moved goalposts” yet again.

3. Obama does not in fact have to release illegal aliens or cancel ship deployments due to the sequester — he’s doing these things by choice, for political purposes.

Welcome to The Obamaian Universe,

He doesn’t want to cut spending. He wants more of it. Forever. Public spending is beyond ideology for Barack Obama. It’s the oxygen in his universe.
…
Maybe it’s time to come to grips with the fact that he sees the public economy of federal spending as the life force of the nation as no president ever has, not even Franklin Roosevelt.

Indeed!

February 23, 2013 By Fausta

Political histrionics 101, part 2

If You Don’t Buy This Budget, We’ll Kill This Seal

(Click on link for full size)

February 6, 2013 By Fausta

No budget? No problem!

If you listen to the POTUS, you’d be thinking that because he’ll just keep raising taxes.

However, if you look at the Congressional Budget Office (CBO), the situation’s different:
CBO: Tax Increase Fails to Solve Spending and Debt Crisis

With economic growth and President Obama’s two tax increases, the $1 trillion tax hike in Obamacare, and the $618 billion fiscal cliff increase, revenues will surge to 19.1 percent of gross domestic product (GDP) in 2015, and will remain well above the historical average of 18.5 percent for the rest of the decade. These figures offer conclusive proof that—notwithstanding the assertions of the President and Senate Democrats—there is plenty of revenue flowing into Washington.

Yet even all this new revenue fails to solve the government’s fiscal problems. Starting at $845 billion this year, deficits shrink somewhat through 2016, but then start rising again, returning to near the trillion-dollar range by 2023. The pattern proves that higher taxes cannot solve the deficit problem—only spending restraint can.

Read the whole thing.

January 15, 2013 By Fausta

Tuesday debt ceiling roundup

It’s gray outdoors, the Angelenos are freaking out over cold weather,

and us taxpayers are paying for Bill Clinton’s Cinemax and Jimmy Carter’s Dish Network (neither of which this taxpayer indulges on).

Obama, “a pretty friendly guy“, gave a press conference that The Other McCain called a festival of lies. The message of the press conference was that a debate over the debt limit was already harming the economy and could push the U.S. into a recession, and Obama didn’t bother explain the position he took as senator.

Does that mean that Obama owns the debt now?

Nope.

No matter what the facts are – that Federal outlays exploded after 2009 –

two things are happening:

The notion of a POTUS held accountable for disastrous spending went out of fashion on Tuesday, January 20, 2009, and
‘You Kids are So Damn Screwed’

But the Wall Street Journal indulges in wishful thinking,

The next time Mr. Obama holds a press conference, somebody should ask him to identify by name those who want to repeal Social Security, steal food from orphans and cancel science funding. We’d like to meet these Visigoths. Otherwise, if the fiscal negotiations are going nowhere, perhaps it is because the President simply won’t make an honest argument.

For now, the White House has informed House Budget Committee Chairman Paul Ryan (R-Wis.) that it will miss the legal deadline for sending a budget to Congress.

Do we have an imperial president?

In other news, Inauguration fund coming up $8 million short? Or is it $10 million?

But hey, if we get to pay for Bill’s Cinemax, we may get to pay for O’s inaugural! It’s the perfect time to wear black.

January 2, 2013 By Fausta

Our taxes just went up; O heads to Hawaii

Feel the squeeze,

According to the bill, Americans at all income levels would see a two-percentage-point jump in the employee portion of the Social Security tax. It will return to 6.2% in 2013 after a stimulus rate of 4.2% expires.

And then there are the Obamacare tax increases,

As for small business, the overall tax increase this year is substantial. The new listed top rate of 39.6% doesn’t include the phaseout of deductions that will take the actual rate to 41% or so for many taxpayers. Add the ObamaCare surtaxes on investment income (3.8%) and Medicare (0.9%), as well as the current Medicare tax of 1.45% (employee share), and the real top marginal tax rate on a dollar of investment income from a bank savings or money-market account will be about 46%. Throw in state taxes, and the marginal rates in many places will be in the mid-50%-or-higher-range.

Meanwhile, even as Democrats claim these tax rates won’t matter to investment, Senators stuffed their bill full of tax subsidies for special business interests. The wind tax credit survived (cost: $12.1 billion), and so did the tax breaks for cellulosic ethanol ($59 million) and the impoverished producers of Hollywood ($248 million).

But I digress. The fiscal cliff carries $4 trillion price tag over next decade. Here are 6 Things You Won’t Believe That Are In The Fiscal Cliff Bill That The Senate Passed At 2 AM While Most Americans Were Drunk. So you’re OK if you’re in the Puerto Rican rum, asparagus, or biodiesel businesses.

The rest of us can rejoice in the fact that we’re paying for Obama’s $7million Hawaiian vacation, to which he returned less than an hour after Congress and the White House resolved the fiscal cliff.