An alternative budget proposal submitted by Congressman Paul Ryan (Wis.), the House Budget Committee’s Republican ranking member, would increase the federal budget deficit even more than President Obama’s bloated budget — nearly $1 trillion more — according to a February 24 analysis by the Congressional Budget Office (CBO).
Ryan’s “alternative policy scenario” would make no serious spending cuts, but it would institute three new tax cuts. CBO Director Douglas Elmendorf explained to Ryan that “the three changes to the tax policy assumptions are estimated to increase deficits relative to the baseline projections by $9 billion in 2010 and $3.4 trillion over the 2011-2020 period, mostly from lower revenues but also from increased outlays for refundable tax credits.”
“CBO estimates that, under the alternative scenario you specified, the deficit would amount to $1.2 trillion in 2020, about $500 billion more than the shortfall projected under baseline assumptions.”
Overall, the Republican budget alternative would increase the federal budget deficit by $9.4 trillion over the next 10 years, while President Obama’s fiscal 2011 budget would increase the deficit by $8.5 trillion over the same period of time.
$2 billion-plus debt grows as leaders pass the hot potato
It has been more than a year since Ohio depleted its unemployment-compensation fund, and with the fund’s debt surpassing $2billion and growing, a fix is nowhere in sight.
No one has even proposed what should be done to shore up the fund – not the governor, not the General Assembly, not an advisory panel made up of business, labor and legislative leaders.
In fact, state leaders can’t even agree on who is responsible for solving the problem.
The Unemployment Compensation Advisory Council threw its hands up 15 months ago after it was unable to reach consensus; it said the legislature would have to figure out a solution.
GOP leaders in the Senate say Gov. Ted Strickland must come up with a plan. The governor has urged the council to take another crack at it.
Absent action from the Statehouse, Ohio will owe the federal unemployment trust fund an estimated $3billion by the end of the year. Interest payments on the loan, which begin to accrue on Jan. 1, are projected at $120 million a year.
Frustrations boiled over again in a Senate committee hearing this week when Republican legislators pushed the administration for answers.
“It’s amazing the governor hasn’t said anything about this,” said Sen. Keith Faber, R-Celina. “This is a problem that is not going to get any smaller. … It’s part of a big hole going into the next budget.”
by Ian Bremmer and Nouriel Roubini
Hat tip: The Wall Street Journal
Friday, February 5, 2010
After months of shrugging off debt problems in Dubai, Greece and other smaller economies, markets yesterday seemed suddenly aware of the risks of sovereign default.
Back in November, when the question of Dubai’s solvency came to a head, it was ultimately bailed out by its rich older brother, Abu Dhabi. Now, the European Union is doing its best to avoid promising a similar bailout to Greece, though in the end few believe Brussels will allow Athens to go under.
The current crisis in Greece is only the worst example inside the EU. The PIGS—Portugal, Italy, Greece and Spain—all boast public debt above or headed for 100% of GDP. Though the PIGS acronym was apparently coined by British bankers, Britain, Ireland and Iceland also smell distinctly of bacon.
The problem isn’t confined to Europe. Japan and the United States, by most reckonings the world’s largest economies, also face pressing questions about their sovereign debt levels. To be sure, the U.S. and Japan can sustain such deficits more comfortably than small countries like Greece or Portugal where the government’s ability to curb public-sector spending is rightly suspect. Yet even in economic giants, bad policy could cause investors to move out of debt they have long considered a safe haven. The moment is approaching when the artificial line separating the wealthy from emerging markets will lose much of its relevance.
Davy Crockett (1786-1836), was an American legend, remembered especially for his bravery in the battle of the Alamo. But there was a far more significant battle that he fought to preserve the liberties of American citizens, back in the time when politicians took the Constitution seriously.
One day, when Davy Crockett was serving in the House of Representatives, a bill came up to appropriate money for the benefit of a widow of a distinguished naval officer. As usual in Congress, flowery speeches were made, not so much to convince the House, since most felt that it would pass easily, but to afford the opportunity to connect ones name with the popular bill. Before the Speaker called for the vote, Representative Crockett arose and what he said surprised his colleagues:
“Mr. Speaker — I have as much respect for the memory of the deceased, and as much sympathy for the sufferings of the living, if suffering there be, as any man in this House, but we must not permit our respect for the dead or our sympathy for a part of the living to lead us into an act of injustice to the balance of the living. I will not go into an argument to prove that Congress has no power to appropriate this money as an act of charity. Every member upon this floor knows it. We have the right, as individuals, to give away as much of our own money as we please in charity; but as members of Congress we have no right so to appropriate a dollar of the public money. Some eloquent appeals have been made to us upon the ground that it is a debt due the deceased. Mr. Speaker, the deceased lived long after the close of the war; he was in office to the day of his death, and I have never heard that the government was in arrears to him. This government can owe no debts but for services rendered, and at a stipulated price. If it is a debt, how much is it? Has it been audited, and the amount due ascertained? If it is a debt, this is not the place to present it for payment, or to have its merits examined. If it is a debt, we owe more than we can ever hope to pay, for we owe the widow of every soldier who fought in the War of 1812 precisely the same amount. There is a woman in my neighborhood, the widow of as gallant a man as ever shouldered a musket. He fell in battle. She is as good in every respect as this lady, and is as poor. She is earning her daily bread by her daily labor; but if I were to introduce a bill to appropriate five or ten thousand dollars for her benefit, I should be laughed at, and my bill would not get five votes in this House. There are thousands of widows in the country just such as the one I have spoken of, but we never hear of any of these large debts to them. Sir, this is no debt. The government did not owe it to the deceased when he was alive; it could not contract it after he died. I do not wish to be rude, but I must be plain. Every man in this House knows it is not a debt. We cannot, without the grossest corruption, appropriate this money as the payment of a debt. We have not the semblance of authority to appropriate it as a charity. Mr. Speaker, I have said we have the right to give as much of our own money as we please. I am the poorest man on this floor. I cannot vote for this bill, but I will give one week’s pay to the object, and if every member of Congress will do the same, it will amount to more than the bill asks.”
Taxpayers are on the hook for an extra $55,000 a household to cover rising federal commitments made just in the past year for retirement benefits, the national debt and other government promises, a USA TODAY analysis shows.
The 12% rise in red ink in 2008 stems from an explosion of federal borrowing during the recession, plus an aging population driving up the costs of Medicare and Social Security.
That’s the biggest leap in the long-term burden on taxpayers since a Medicare prescription drug benefit was added in 2003.
The latest increase raises federal obligations to a record $546,668 per household in 2008, according to the USA TODAY analysis. That’s quadruple what the average U.S. household owes for all mortgages, car loans, credit cards and other debt combined.
“We have a huge implicit mortgage on every household in America — except, unlike a real mortgage, it’s not backed up by a house,” says David Walker, former U.S. comptroller general, the government’s top auditor.
“We can’t solve problems by using the same kind of thinking we used when we created them.”
– Albert Einstein
Forty-six of fifty states are now reported to be so insolvent that they could be filing Chapter 9 bankruptcy proceedings within the next two years.1 Of the four that are not in that category, one is the isolated farming state of North Dakota. What does it have that other states don’t? The answer seems to be: its own bank. In fact, North Dakota has the only state-owned bank in the nation. It has avoided the credit freeze caused by the derivative schemes of the Wall Street bankers by creating its own credit, leading the nation in establishing state economic sovereignty.
North Dakota is an unlikely candidate for the distinction. As Michigan management consultant Charles Fleetham observed last month in an article distributed to his local media:
“North Dakota is a sparsely populated state of less than 700,000, known for cold weather, isolated farmers and a hit movie – Fargo. Yet, for some reason it defies the real estate cliché of location, location, location. Since 2000, the state’s GNP has grown 56%, personal income has grown 43%, and wages have grown 34%. This year the state has a budget surplus of $1.2 billion!”
The secret of its success seems to be the state-owned Bank of North Dakota, which was established by the state legislature in 1919 specifically to free farmers and small businessmen from the clutches of out-of-state bankers and railroad men. By law, the state must deposit all its funds in the bank, and the state guarantees its deposits. The bank’s stated mission is to deliver sound financial services that promote agriculture, commerce and industry in North Dakota. The bank operates as a bankers’ bank, partnering with private banks to loan money to farmers, real estate developers, schools and small businesses. It loans money to students (over 184,000 outstanding loans), and it purchases municipal bonds from public institutions.
A License to Create Money
Still, you may ask, how does that solve the solvency problem? Isn’t the state limited to spending only the money it has? The answer is no. Certified, card-carrying bankers are allowed to do something nobody else can do: they can create “credit” with accounting entries on their books.
Back in September 2003 — long before I ever knew about the [non] Federal [no] Reserve Bankster scam, Pastor Rod Parsley of the World Harvest Church said, “If we have a national debt of 6 trillion dollars, it would be interesting to know who we owe.”
He got my attention…
“To whom do the citizens of the United States of America owe 7 trillion dollars? … Your bible doesn’t call it interest, your bible calls it usury. I dare you to touch somebody and tell them, You ain’t using me! … See when that banker comes along and says, it’s just interest, you ought to look right back at him and say, you’re USING me!”
He went on to powerfully quote the Bible and Jefferson and then said, “Do you know right now, that if we got together as the American people and we sold every building, and every square inch of American soil, for the total amount of its worth, we would have to pay back THAT America — and two more! Somebody OWNS this nation.”
The Era of American Leadership Is Over By Paul Craig Roberts
February 02, 2009 “Information Clearinghouse” — -Vast numbers of people in the United States and abroad are hoping that President Obama will end America’s illegal wars, halt America’s support for Israel’s massacre of Lebanese and Palestinians, and punish, instead of reward, the shyster banksters whose fraudulent financial instruments have destroyed economies and imposed massive sufferings on people all over the world. If Obama’s appointments are an indication, all of these hopeful people are going to be disappointed.
James Petras examines Obama’s foreign policy appointments and finds the largest collection of Zionist militarists outside of Avigdor Lieberman’s far right political party in Israel.
Petras concludes that Obama’s “diplomatic” team has Iran in its sights, an hostility that meshes with Israel’s own intent. Not realizing that a member of the press had been mistakenly invited to a selected audience, the Israeli ambassador to Australia said that Israel’s attack on Gaza was a dress rehearsal for a major attack on Iran. Netanyahu, the expected winner of Israel’s March elections, has again declared that Israel will not permit Iran to have a nuclear energy program as it would provide the basis for developing nuclear weapons.
It makes no sense for Israel to baldly state its intention to attack Iran if Israel does not mean it. What if the Iranians believe the Israelis and decide to strike first with their long-range missiles?
Obama’s economic appointments are just as discouraging. Obama chose as his Treasury Secretary Timothy Geithner, the man who helped Bush’s Treasury Secretary, Hank Paulson, engineer the $700 billion dollar rip off of the US taxpayer, money that was gifted to the crooked banksters who destroyed Americans’ pensions, jobs and health care coverage.
These banksters, and the negligent federal regulators that enabled them, should be put in prison, not handed hundreds of billions of dollars.
The US National Debt is 9.6 trillion dollars. The US Population equals 304 million people. Each citizen’s share of the national debt is $31,641. The interest on the national debt is $430 billion (about $1400 for every man woman and child.) True indebtedness of US government adding unfunded obligations into the future — approaches $50 trillion.
This is what we are leaving for our children, our grandchildren. No nation in the history of mankind has ever been as heavily in debt as ours, and our leaders have numerous foreign aid programs where they give away money.
And of course there is a woeful lack of understanding. There are people today who say, “We need the Fed because someone has to manage the currency.” Ladies and Gentlemen, that is one of the greatest fallacies of all. If the currency is a commodity like gold or silver, it does not have to be managed. The free marketplace will manage it. Money should be a commodity — valuable to all people, and there’s no management needed. People say to me, if you get rid of the Fed what are you going to replace it with? I say, if you’ve got cancer do you wanna replace it with pneumonia and two broken legs? No you don’t.
Economists continually try and sell the public the idea that recessions or depressions are a natural part of what they call the “business cycle”. This timeline below will prove that is simply not the case. Recessions and depressions only occur because the Central Bankers manipulate the money supply, to ensure more and more is in their hands and less and less is in the hands of the people.
Central Bankers developed out of the ancient money changers and it is with these people we pick up the story.
48 B.C. Julius Caesar took back from the money changers the power to coin money and then minted coins for the benefit of all. With this new, plentiful supply of money, he established many massive construction projects and built great public works. By making money plentiful, Caesar won the love of the common people, but the money changers hated him for it and this is why Caesar was assassinated. Immediately after his assassination came the demise of plentiful money in Rome, taxes increased, as did corruption.
Eventually the Roman money supply was reduced by 90 per cent, which resulted in the common people losing their lands and homes.
30 A.D. Jesus Christ in the last year of his life uses physical force to throw the money changers out of the temple. This was the only time during the the life of his ministry in which he used physical force against anyone.