Is anyone paying attention?

I was speaking with a client last week. She had no idea that the only institution currently buying US Treasury Bills is the US Federal Reserve Bank. When I mentioned this to her, she instantly understood the ramifications. After all, she is the CFO of a large institution. If someone like her, whose entire career is focused on sophisticated financial matters, is unaware that we are just printing money, then I don't suppose that normal people can be expected to know.

It's too bad, though. We are headed to a financial disaster, and no one seems to care.

Posted with Blogsy

This is what we pay the senators to do?

It has been yearly 35 months since the United States Senate has passed a budget. Harry Reid, and other top Democratic senators, refuse to even vote on a budget. And yet, they make the time to hold hearings on possible bounty programs in NFL teams.

Conservatives must make it an absolute priority to win back the Senate in 2012.

Another nonsensical political act

The national news cycle was somehow dominated by Congress' negotiations over the payroll tax. This was a meaningless action, implemented for a meaningless period of time. And yet, politicians spent hours in front of the cameras discussing and defending their positions and plans. Could it be worse? Certainly. But isn't there enough noise already? Do we have to add even more political clutter to an already incomprehensible cacophony of posturing?

A drop in the bucket

A few facts:

• The current Congress cannot adopt a budget that binds a future Congress.
• The targeted spending changes of the so-called "Super Committee" amounted to less than 5% of the projected spending over the planning period (10 years).
• There were no spending cuts in the charter of the "Super Committee." Government spending increases in every plan given serious consideration.
• It has now been over 940 days since the U.S. Senate has passed a budget of any kind.

My opinions:

• The President and Senate have both abdicated their authority and have shown themselves to be fiscally irresponsible.
• The Democratic party, and its primary constituents (unionized government labor), are demonstrating a blatant disregard for the fiscal health of our country, in favor of their own personal well-being.
• Unionized government labor is becoming a ruling class and is attempting to make that status permanent.

A Boundless Faith in Government

Someone recently said to me that "government just screws up everything they touch." So I asked him why he was so in favor of Obamacare. He said because healthcare costs too much.

I've given up trying to change his mind.

Karl Rove said it well in an Op-Ed piece in today's Wall Street Journal:

This liberal lack of faith in the people is combined with a nearly boundless confidence in government

I'm taking his quote out of context, but I'm not misrepresenting his point. Today's liberals do not see the inherent contradiction in their policy positions. It's seemingly willful. And I don't see how their minds can be changed by rational, logic-based arguments.

Karl Rove: Obama and the Politics of Condescension (link requires subscription)

Temporary tax policies never work

I'd like to focus on one small part of the President's big address from Thursday... this notion of a Payroll Tax Holiday. On Friday, Sen. Paul Ryan had this to say on CNBC :

"The payroll tax cut that, to me, is not a bad idea. It's always good to let people keep more of their own money," Ryan said. "But it's no substitute for fundamental tax reform--for certainty. It's temporary stuff.

"See, what we've learned already from the Keynesian playbook is demand side spending stimulus, temporary tax rebates, which were tried in the Bush administration and didn't work, and this administration--all this stimulus hasn't worked."

This has nothing to do with which party has the majority in Congress, or whether it's a conservative or a liberal in the White House. The bottom line is that temporary fiscal measures never work. The Bush administration tried them. And the Obama administration has tried them. They don't work. Stop doing it!

They might have worked when information moved slowly. But not any more. Decision makers in business look at all of the available information before making a choice. And if that choice involves hiring another employee, their planning horizon is at least three years. An ethical business owner ... and most are highly ethical ... will not make the implied promise of a livelihood to a new employee unless he is confident that he will still be part of the company three years from now. Otherwise, it's better to simply hire a contractor.

There is no hiding from a record

Obama was elected on the promise of changing the direction of government. He would reverse the rightward leanings of the executive branch that have been in place since 1980 with an aggressive, leftward, progressive agenda. No longer would federal bureaucracies react to the economy ... the federal bureaucracies would drive the economy. And how has he kept that promise?

Steven Hayward writes in PowerLine:

Obama has collapsed on the Bush tax cuts, the debt ceiling, expanded the war in Afghanistan, said “never mind” to his promise to close Gitmo, went to war against Libya without congressional authorization or UN resolution, and retracted several key environmental regulations while signaling that he will approve the Keystone pipeline. Progressives are starting to notice.

This is a short list of his failures. But what about his accomplishments?

ObamaCare was passed along a strictly party line vote. The voters' response? A Rasmussen Poll of likely voters indicates that 57% of likely voters favor repeal of this unprecedented expansion of the federal government's impact on our very personal lives.

The financial reform has created more uncertainty in the banking sector, keeping investment cash on the sidelines. It's too complicated for the evening newscast, but the stifling effect that this has had on our economy is stunning in its breadth and depth. It's often said that generals fight the last war ... the Dodd-Frank bill is no exception: It blatantly ignores the huge role that the federal government played in causing the ongoing housing crisis.

And then there is, of course, nearly $1 Trillion in so-called "stimulus" ... again passed along party lines. All that has gotten us is zero net job growth for the first time in over 55 years; an explosion in sovereign debt; and some really snazzy signs to litter our roadways.

Obama's record of failure has exposed leftist policies for the sham that they are. The policy initiatives that he has endorsed have resulted in consistently poor results for the country. The conservative policies that he has grudgingly accepted are the only ones that he can claim have enjoyed any kind of success. The progressives will vote for him because they have no one else. But he cannot run on his record, even with the media pulling for him.

Accurate Deception

Here is a fascinating graphic. It is technically accurate, but it is highly misleading. It describes the public debt as a static sum. Its sole purpose is to assign blame for the rapid growth in the national debt to George W. Bush.

How is this misleading?

The nominal amount of debt racked up by Bush 43 is $6.1 Trillion.
The nominal amount of debt racked up by Obama is $2.4 Trillion ... or just shy of 40% of the total Bush 43 presidency.

But remember, Obama is only 30 months into his presidency, meaning that his policies are increasing the debt at a rate $80,000,000,000 per month!. If this were to continue for two terms (perish the thought), the total additional debt created in the same period as Bush 43's presidency would equal nearly $8 trillion, or about 33% more. And this does not even account for Obamacare, which hasn't even begun adding to our debt.

Yes, Bush 43 added $6.1 trillion to the public debt. Yes, this was not a success. Obama's supporters have no explanation for why doing more of a bad idea is somehow a good thing.