How to cut government spending

[G M]

There is such a culture of denial in the country, it's amazing to me.


Future generations will rage at our collective stupidity and irresponsibility.

[ccp]

Washington "insiders" should listen more to Morris than Rove IMO:

IT’S NO DEAL, IT’S A SELLOUT
By Dick Morris And Eileen McGann 04.9.2011 Share this article
     
John Boehner has just given away the Republican victory of 2010 at the bargaining table. Like the proverbial Uncle Sam who always wins the war but loses the peace, he has unilaterally disarmed the Republican Party by showing that he will not shut down the government and will, instead, willingly give way on even the most modest of cuts in order to avoid it. He now has no arrows left in his quiver.

Having failed to stand firm for just $61 billion in cuts in a budget of $3.7 trillion, how can we expect him to stand firm over the debt limit extension or the 2012 budget? We can’t. The excellent budget proposals of Paul Ryan are no more than a pipe dream now. Boehner has He sold us out now and he’ll sell us out again.


It is the duty of every Republican Congressman to vote no on this terrible deal. It violates our campaign promises to the American people. We promised $100 billion of cuts and we delivered $38 billion ($62 billion on a twelve month basis). In the Republican House’s first real test out of the box it has broken the promise over which it was elected. Only in Meat Loaf’s music is “two out of three not bad.”

This concession makes it clear that:

* Obamacare will not be defunded.
* The EPA will not be blocked from regulating carbon.
* The NLRB will not be stopped from forcing an end to secret ballots in union contests.
* Medicaid will not be block granted and turned over to the states.
* Welfare spending will not be cut nor work requirements imposed.
* The FCC will not be stopped from regulating talk radio.

In short, we have accomplished nothing by our hard work in 2010.

Except we have learned a lesson.

And the lesson is this: We need to purify our party and purge it of the likes of John Boehner and all those Congressmen who vote for the budget sellout. The Tea Party must take the lead in this purifying fire. We must not let the RINOs win!

DickMorris.com will post prominently (and permanently) the names of all GOP freshmen who vote for this rotten deal. It will be in a column headed: THESE ARE THE SELLOUTS. Check it out and back their primary opponents!

[ccp]

For the first time ever the Economist (since I have subscribed) has praised a Republican.  Of course a little grudgingly, and with caveats, like these:

"Too much of the gain goes to the rich, and too much of the pain is felt by the poor."

and

"Some of his figures are deeply suspect"

Yet this is a landmark for this magazine which is definitely left leaning.  They even criticize the One and don't tend to support him anymore.  The road ahead is becoming clearer.  The Crats will be coming out with their deficit cutting plan.  Included will be increase taxes and revenues with the all out assault on attcking the "rich" the "corporation", "protecting women", "the poor" "the minorities", "middle class rights", and all the rest of their mantra.

I am not sure if Bamster will follow his cowardly pattern of letting Reid com out with a plan and then play like he is above it all and the great compromiser etc. or if he will come out with his plan.  But the left is going to HAVE to counter the Ryan plan.  Then Americans will have to choose which one they will want.   But the deficits cannot be ignored anymore.


 ****The Republican budget
Praising Congressman Ryan
At long last somebody is trying to grapple with America’s fiscal troubles
Apr 7th 2011 | from the print edition
Tweet BARACK OBAMA, as we unhappily noted when he produced his budget in February, has no credible plan for getting America’s runaway budget deficit under control. Up to now the Republicans have been just as useless; they have confined themselves to provoking a probable government shutdown in pursuit of a fantasy war against the non-security discretionary expenditures that make up only an eighth of the total budget, rather than tackling the long-term problem posed by the escalating costs of entitlements. The only people with the guts to talk about such things have been various independent commissions which the two parties have ignored.

Now that has changed. On April 5th Paul Ryan, the young chairman of the House Budget Committee, laid out a brave counter-proposal for next year’s budget and beyond (see article)—brave both in identifying the scope of the problem and in proposing the kind of deeply unpopular medicine that will be needed to cope with it. It is far from perfect; but it is the first sign of courage from someone with actual power over the budget.

Unlike Mr Obama, Mr Ryan puts fiscal responsibility at the centre of his plan: it aims to bring the budget into primary balance as early as 2015 and federal government spending down to below 20% of GDP in 2018. He also outlines a simplification of America’s mad tax code, bringing the top rate for both individuals and businesses down to 25% by eliminating loopholes. Above all, he aims at the core of the problem, the ever-rising cost of health care for the elderly.
At the moment, retirees in America are entitled to Medicare, an all-you-can-eat buffet of care provided by the private sector but paid for by government-run insurance. Under Mr Ryan’s scheme, future retirees would have to take out private insurance plans, helped by a government subsidy. The effect would be a bit like changing from a defined-benefit pension to a defined-contribution one. The savings come because the subsidy would not cover everything that is currently provided: people will either end up with less lavish care or have to pay more. Mr Ryan also wants to turn Medicaid, government-financed health care for the poor, over to the states in the form of “block grants”. This would force them to manage their budgets more responsibly than they have needed to when they have been able to send much of the tab to Washington.

Let the debate begin

There is plenty wrong with Mr Ryan’s plan. Too much of the gain goes to the rich, and too much of the pain is felt by the poor. Some of his figures are deeply suspect. Mr Ryan should not have ruled out any revenue gain from broadening the tax base. He says nothing substantive about Social Security. He would cancel Obamacare, which though flawed addresses one of America’s great problems. And there are practical difficulties: his proposals are far too radical to engender the sort of compromise needed in Washington. Even if the plan passes the Republican-controlled House (by no means certain), it will fail in the Democrat-controlled Senate.

Yet at least Mr Ryan accepts that the present system is unaffordable and destined to collapse. Everyone else, including Mr Obama, is pretending that it isn’t. Mr Ryan’s willingness to confront the scale of the problem has set a standard by which other proposals will now have to be judged. And there might even be political mileage in telling the truth. Two years ago, when Britain’s prime minister, Gordon Brown was unable to mention the word “cuts”, George Osborne, the Tories’ shadow chancellor, made a speech saying they were inevitable. It changed the political debate. Mr Brown’s protestations looked increasingly ridiculous. Mr Obama should take note.****

[Crafty_Dog]

"The multiplication of public offices, increase of expense beyond income, growth and entailment of a public debt, are indications soliciting the employment of the pruning knife." --Thomas Jefferson, letter to Spencer Roane, 1821

[ccp]

""The multiplication of public offices, increase of expense beyond income, growth and entailment of a public debt, are indications soliciting the employment of the pruning knife." --Thomas Jefferson, letter to Spencer Roane, 1821"

That's beautiful talk but until republicans can answer the concerns of the middle class and the growing dipsarity of wealth it is a perpetual uphill fight.

A township can't give Walmart a property tax break that they do not offer to anyone else.

If Walmart comes in buys up a lot of land, and builds a big center that no one else can afford or risk the investment that is fine.  But we cannot have governments offering breaks to some and not others.

That is discrimination and unfair.

[ccp]

Here it comes.  Bamster's vision for reducing deficits.  Rob successful people to pay down debt.
No surprise.

Well I have yet to hear Republicans successfully counter this other than with indirect deflecting answers,
"trickle down"
"job creation"
"stimulate growth"
They have to be more specific.  I don't want to see the same demogougery against them about the poor, those "who need it most", hurting women etc etc.

They look like the heartless white boys everytime.

When will they learn?

Just capitulating ala Rove doesn't work.

I am not sure a ram it through despite being painted as heartless ala Morris is quite the answer either.

They have got to come up with better talking points that counter the usual charges against them.

[Crafty_Dog]

REAGAN.

Growth
Opportunity
Savings/Investment
God & Country, Strength & Honor
Freedom & Responsibility

[ccp]

Crafty,
I believe these arguments are a penny short -

"Opportunity
Savings/Investment"

Tell that to a crowd that is forever struggling to pay bills, working harder while not keeping up with inflation, Wall Street bailed out, Banks doing better, and more and more wondering if ain't just easier to go on disabilty if they can get a doctor to write for it.

Plain ideals just don't cut it for more and more Americans.
I still don't hear why people should think they are better off without government benefits when 50% rely on them or are ripping the rest of us off taking the free lunch.

Simple Reagan theories ares not enough of a compreshensive argument anymore.  Not when you have 60% getting more than they pay in.  To them it is let the "rich" pay.

[DougMacG]

"But we cannot have governments offering breaks to some and not others.  That is discrimination and unfair."

Thank you for that CCP!  That is the central point of my objections to our entire 'targeted' tax and spend system.  Lower the rates until you don't need exemptions.  Nothing is a mandate that requires a thousand organizations exempt.  Lower the burden to the point that you would apply it to anyone, even yourself.  Stop trying to keep everyone else for driving when you golf with a ten SUV motorcade.


An attempt, CCP, at answering your point about our opponents' spending/wealth transfer and disparity arguments:  

Economic freedom, like democracy appears ugly as you look too closely at it.  People bought pet rocks with their prosperity and someone got rich off of it.  People on wall street appear to sit, appear to make a few phone calls and investments and make absurd amounts.)  It is just better than all the alternatives where nobody makes any money or serious production or innovation.

People should note that the Republicans of 2012 like Paul Ryan are not proposing an unregulated, untaxed, undistributed private economy.  They are proposing 3.5 trillion a year of federal moving of money around instead of 3.8 or so and rising more rapidly.  R's actually are proposing to make the welfare state permanent and sustainable instead of headed off the cliff.


When a company like Walmart finds a better way of doing things, there is an economic shift and dislocation.  No one small can compete with head-on with a company that large, like an auto maker, but anyone who wants to can put any part of their savings into publicly traded shares of a retailer or automaker or start a business that benefits from having a major retail outlet in town.  Michael Moore in the movie 'Roger and Me' documented how GM had provided all paychecks to all these family members in Flint Michigan for all these generations and implyied that should go on forever.  But GM was building lousy cars that people didn't want and labor was part of the problem.  People needed to figure out quickly something else they can do that adds value to the economy, just like others adapting people have learned to do for tens of thousands of years of economic survival.  The bigger and stronger the social programs, the longer that process takes and the more people learn instead to survive off of someone else.  Every law, regulation, program and tax that I know of acts to slow or prevent the process of the transition that needs to happen like innovating, changing, to provide for your family.

Retail selling of ordinary household goods to compete with Walmart is a lousy business these days.  But what is supposed to be our reaction to that? Prohibit and limit the Walmarts or prop up competitors with failed programs that fight against market forces?  Pay people to not work?  That's not facetious, we are doing these things all over the place.  What is the failed result?  People are slower to respond to changing circumstances, or never do.  The programs ultimately hurt the 'beneficiary' of the program (IMHO), besides hurting all the other businesses and producers with the tax burden.

Show me a persuasive argument about the dangers of disparity in a growing economy and I will show you flawed and deceptive analysis.  Income mobility is the answer.  At different points in your life it goes income moves in different directions.  

Dems, as you suggest, will point back at disparity questions during the good times past, characterized with false analysis, but those times were far better than what has happened since.  They need to also answer to their own failed results.  Certainly no one can say we are better off since Nov. 2006/Jan. 2007 when Pelosi Reid Obama won and took the power and majorities in Washington.  The disparity challenges during 50 consecutive months of job growth during Bush (that ended with the Dem, elections) or during a quarter century since Reagan pale in comparison IMO to the fact of doubling unemployment, the foreclosure mess, $5 gasoline, bankrupt states, etc.  They are going to run on THAT record and at some point they will look petty and hopeless as they still blame Bush.

As far as this thread goes, greater government spending has not been the solution to any of our problems.  Disparity was 'improved' with the tens of trillions in destruction in wealth.  How did that help working people on a budget?

[ccp]

Doug,
Thanks for the reply.
I hear you and don't disagree.  Yet most Americans might.

Your argument (standard Republican) does not address this.  If anyone wonders why Cans always have to fight and fight and fight to win a majority this is why plain and simple:
Cut With Entitlements Secured
By Heidi Przybyla and Mike Dorning - Dec 10, 2010

Former Comptroller General David Walker said, “The idea that we can solve our structural-deficit problems merely by asking more of the well-off is totally unrealistic.”  
The one place Americans are willing to see sacrifice is in the wallets of the wealthy and Wall Street. Photographer: Daniel Acker/Bloomberg
Americans want Congress to bring down a federal budget deficit that many believe is “dangerously out of control,” only under two conditions: minimize the pain and make the rich pay.

The public wants Congress to keep its hands off entitlements such as Medicare, Medicaid and Social Security, a Bloomberg National Poll shows. They oppose cuts in most other major domestic programs and defense. They want to maintain subsidies for farmers and tax breaks like the mortgage-interest deduction. And they’re against an increase in the gasoline tax.

That aversion to sacrifice is at odds with a spate of recent studies, including one by President Barack Obama’s debt panel, that say reductions in Medicare, Social Security, military and other spending are necessary to curb a deficit that totaled $1.29 trillion in the fiscal year ended Sept. 30, or 9 percent of the gross domestic product.

“The idea that we can solve our structural-deficit problems merely by asking more of the well-off is totally unrealistic,” said David Walker, who was U.S. comptroller general from 1998 to 2008 and now leads a group advocating against deficits. “The math simply doesn’t work.”

According to the Dec. 4-7 poll, taken days after Obama’s commission sounded an alarm over the nation’s “unsustainable fiscal path,” the public still believes it’s more important to “minimize sacrifice” than to take “bold and fast” action to pare the $13.7 trillion national debt.

‘Deficit Cutting Hurts’
If anything, the poll shows that public concern over the deficit has ebbed: Forty-eight percent of Americans say the budget shortfall is “dangerously out of control,” down from 53 percent who said that in an October survey.

“The reality is deficit cutting hurts, and the American public is in no mood for further hurt than the slow economy and high unemployment is delivering,” J. Ann Selzer, president of Selzer & Co., a Des Moines, Iowa-based firm that conducted the nationwide survey.

Investors are worried about a widening of the budget gap. Treasuries tumbled for two days after Obama announced a plan to extend Bush-era tax cuts and reduce payroll taxes, stoking concern over more borrowing. The 10-year yield rose 35 basis points in its biggest back-to-back increase in more than two years. Treasuries rebounded yesterday on uncertainty over the prospects for the tax cuts. The 10-year Treasury yield slipped five basis points to 3.22 percent at 4 p.m. in New York.

Sacrificing the Rich
The one place Americans are willing to see sacrifice is in the wallets of the wealthy and Wall Street.

While they say they strongly support balancing the budget over the next 20 years, when offered a list of more than a dozen possible spending cuts or tax increases, majorities opposed every one of them except imposing a bigger burden on the rich.

A majority backs raising the cap on earnings covered by the tax on the Social Security retirement program above the current limit of $107,000. Two-thirds would means test Social Security and Medicare benefits. Six of 10 would end tax cuts for the highest-earning Americans. And 7 of 10 favor a tax on Wall Street profits.

“We give billions of dollars to these corporations, and in my eyes they pretty much just put it in their pocket,” said Donald Froemming, a 57-year-old independent voter and unemployed diesel gas mechanic from Moose Lake, Minnesota.

Divided on Taxes
While Republican congressional leaders have opposed increases in taxes paid by high-income families, sentiment among the party’s rank and file is mixed. Republicans are divided on eliminating the tax cuts for the wealthy, with 50 percent opposing and 47 percent supporting. An increase in the cap on earnings subject to Social Security taxes splits Republicans almost evenly.

The poll shows there’s little appetite across all parties and demographic groups for changes to entitlements.

Eighty-two percent of respondents opposed benefit cuts to the Medicare health-insurance system for the elderly, with about half of Republicans wanting to see both the current Medicare and Social Security systems preserved. Just 35 percent of all respondents back a system in which government vouchers would help people pay for their own health insurance.

“Nobody wants to fail to take care of children who need medicine or the elderly,” said Tea Party supporter Randy Thorman, 45, a high school social studies teacher in Pryor, Oklahoma. “We don’t want to throw people out without some type of help.”

Backing Social Security
Support for keeping the current structure of the Social Security program is strong, at 55 percent. Lower-earning Americans are especially averse to any big changes.

Cathy Freeman, a 64-year-old Republican and retired bookkeeper from Waco, Texas, said the deficit should be addressed by ending tax breaks for the wealthy and corporations, not slashing the entitlement programs her family relies on.

“We need to look at that before you start hurting the little guys,” Freeman said. “Let’s look at some things that aren’t fair in our system.”

A majority of 72 percent also opposes reducing benefits for the Medicaid health program for the poor. This is true even of Tea Party supporters who have built a movement around smaller government, with 66 percent against reducing Medicaid benefits. Seventy-two percent of those earning $100,000 or more also are opposed.

Raise the Cap
In Social Security, the only areas for change that have support are raising the cap on wages subject to the payroll tax and reducing benefits for the wealthy. The wealthy themselves are willing to sacrifice. Those making $100,000 or more are most supportive of raising the cap, at 59 percent. That compares with 45 percent of those making $25,000 or less.

Overall, 67 percent of Americans want means-testing and 51 percent think the payroll tax cap should be raised. Just 31 percent want to see cost-of-living increases trimmed and 37 percent say the government should gradually raise the age of Social Security eligibility to 69.

Partisan differences over the deficit are strong, with Republicans more than twice as likely as Democrats to see the fiscal situation as imperiled. Still, the shortfall is also a potential source of conflict within each party’s coalitions.

Tea Party supporters, who played a key role in Republican victories in the midterm elections, are more likely to back strong action than are rank-and-file Republicans; a 49 percent plurality favors a dramatic overhaul of Social Security, compared with 41 percent of Republicans. Tea Party backers want a Medicare overhaul by 52 percent to 43 percent, while Republicans narrowly prefer to keep the current system.

Splitting the Coalition
The deficit also divides the coalition Obama assembled to win the 2008 election. Political independents, whom he carried then, consider the deficit a more immediate threat than do Obama’s fellow Democrats. Fifty percent of independents said the deficit is “dangerously out of control” versus 29 percent of Democrats.

The poll suggests a possible opening for a new sales tax. Americans are split on a 6.5 percent national sales tax to bring down the deficit, with 46 percent in favor and 49 percent opposed.

Still, three-quarters of the country opposes a 15-cent gasoline tax across party lines. Even among those who want bold action, 7 out of 10 oppose a higher gas tax.

A freeze on nondefense discretionary spending, which some Republican congressional leaders have proposed, is opposed by 53 percent against 43 percent in favor. Cuts in defense spending are opposed by 51 percent versus 45 percent in favor.

The Bloomberg National survey of 1,000 U.S. adults has a margin of error of plus or minus 3.1 percentage points.

To contact the reporters on this story: Heidi Przybyla in Washington at hprzybyla@bloomberg.net; Mike Dorning in Washington at morning@bloomberg.net

[DougMacG]

"I hear you and don't disagree.  Yet most Americans might."

IMO we aren't trying to cut out another trillion (root canal politics) to close trillion dollar gap.  We only need to cap, freeze and control spending.  You close the gap by growing the economy full speed ahead and that is the supply side.  You raise 1 trillion by growing by 5 trillion.  You can't grow $5 trillion while fretting disparity and micromanaging it.  As you say, the laws need to apply evenly.  Someone needs to point out that opportunity for everyone expands in a robust economy.  As JFK put it: a rising tide lifts all boats.

[G M]

JFK ran on cutting taxes to spur the economy. Funny how that's forgotten now.

[Crafty_Dog]

From Paul Revere to Paul Ryan
Paul Ryan Responds to President Obama
by Newt Gingrich

Monday was the 236th anniversary of Paul Revere’s midnight ride to warn John Hancock and Samuel Adams that British troops were coming to arrest them and seize colonial arms at Concord. While riding, Revere stopped at houses along the way to warn everyone that “the British are coming.” His warning galvanized patriots to meet the British at Lexington and Concord, leading to the “shot heard around the world” and the first military battle of the American Revolution.

This year the anniversary fell on the same day income taxes were due. It was unfair taxation that sparked the protests in Massachusetts and other colonies against British rule that came to shape the Founders’ view of limited government. Today, an out-of-control government spending our nation into a debt crisis has sparked another rebellion.

Today, Congressman Paul Ryan has been our generation’s Paul Revere, warning his fellow Americans about the coming danger and rallying us to a plan to meet the threat head on.
Paul Ryan’s Path to Prosperity

The 2012 “Path to Prosperity” budget plan Paul Ryan wrote was passed by the House last week. His plan stands in stark contrast to the 2012 budget proposed by the White House earlier this year. Unlike Ryan’s plan, President Obama’s budget proposal did not deal with entitlement spending, which encompasses the largest share of the federal budget. This led to the president’s budget being widely panned as unserious about the urgent challenge of our time.

In a tacit admission that he had failed to provide leadership on the deficit, President Obama wanted a do-over. Last week he gave a speech to try and regain the high ground and compete with the serious proposal offered by Ryan. Instead, he offered a campaign-style partisan response that only served to diminish him.
In last week’s newsletter, I proposed two big tests by which to measure the president’s plan to tackle our looming deficit crisis.

The first was whether his plan would create jobs or destroy them. Trying to balance the budget without addressing unemployment is futile. The most immediate step necessary to move towards a balanced budget is to employ the policies that lead to job-creation. The more people taken off the welfare roll and moved onto payrolls will decrease the need for food stamps and unemployment compensation. Working people pay tax dollars instead of receiving them through welfare.

The second was whether his plan to control the cost of entitlements relied on merely squeezing the current systems through rationing, reduced benefits and cost controls or if he proposed fundamental structural reforms that would deliver better results at lower costs.

On both tests, the president failed spectacularly. The president proposed nearly $2 trillion in tax increases that would destroy jobs and flatly rejected the idea of fundamental reform of Medicare and Medicaid, proposing instead to kick the can to a board of unelected bureaucrats to find ways to save money within the boundaries of the current system, through even more rationing than what has already been enacted under Obamacare.

In his speech, the president lauded the effort of Republicans and Democrats to work together to balance the budget in the 1990s. Yet the solutions he proposed in his speech are precisely the opposite of what Republicans did when I was Speaker.

We passed the first tax cuts in sixteen years to encourage the private sector to create jobs, including what Art Laffer called the largest capital gains cut in history. This led to a drop in unemployment from 5.6% to below 4%. We also successfully reformed welfare to lift the poor out of poverty in much the same way Paul Ryan proposes to save Medicaid. And we actually increased defense spending as opposed to Obama who proposes to cut it. Through those pro-growth and pro-freedom measures, we balanced the budget and paid off over $405 billion in debt.

Just as troubling as the bad plan put forward by the president was the extraordinary partisan spectacle he engaged in when he slandered Paul Ryan and the GOP 2012 budget. The distortions the president employed while describing the Ryan plan were so malicious, that I wanted to give Congressman Ryan the opportunity to respond himself in this newsletter.

The following is from Congressman Ryan and refutes the president’s most erroneous claims.




 

Paul Ryan Responds

Two months ago, the president introduced an unserious budget that locks in Washington's spending spree, adds $13 trillion to the debt over the next decade, and accelerates our nation toward a fiscal crisis. His budget imposes $1.5 trillion in tax increases on job creators and American families, stifling the private-sector job creation that we urgently need. His budget commits seniors to bureaucratically rationed health care, burdens families with ever-higher taxes, and consigns our children and grandchildren to a diminished future.

Two weeks ago, House Republicans advanced their Fiscal Year 2012 budget resolution – The Path to Prosperity. The House Republican budget spurs economic growth and job creation, strengthens the social safety net for those in need, fulfills the mission of health and retirement security for all Americans, and lifts our crushing burden of debt. The Path to Prosperity prevents the president’s tax increases and instead focuses on the root cause of our debt problem: wasteful Washington spending. The House Republicans’ budget reduces government spending by $6.2 trillion over the next decade, and puts the budget on a path to balance in the years ahead.

The Path to Prosperity has reshaped the budget debate – giving the American people an honest assessment of our fiscal challenges and delivering real solutions that restore the promise of our exceptional nation. In the wake of criticism that House Republicans were leading where his budget had failed, the president followed with a speech intended to show that he shared our concerns about the nation’s most urgent fiscal challenges. Unfortunately, instead of delivering solutions, the president delivered a partisan campaign speech, heavy on overheated rhetoric and light on ideas. Where the president did offer ideas, it was more of the same: huge tax increases and a plan for Medicare that builds on last year’s government takeover of health care and involves restricting seniors’ access to care.

As I noted last week, the president’s speech was excessively partisan, dramatically inaccurate, and hopelessly inadequate to the task of averting a fiscal crisis.

Let’s examine further the factual missteps and egregious errors in the president’s speech.

Discretionary Spending

CLAIM: “A 70% cut to clean energy. A 25% cut in education. A 30% cut in transportation. Cuts in college Pell Grants that will grow to more than $1,000 per year. That’s what they’re proposing.”

REALITY: The House Republican budget simply returns non-defense discretionary spending to below 2008 levels. What the president is inadvertently admitting is that he and his party’s leaders in Congress have increased spending by these breathtaking amounts. Americans elected a new Republican majority in 2010 in part because they were appalled at this lack of spending discipline. The House Republican budget simply adheres to our mandate to stop the Democrats’ unchecked spending spree.

CLAIM: “These aren’t the kind of cuts you make when you’re trying to get rid of some waste or find extra savings in the budget…These are the kind of cuts that tell us we can’t afford the America we believe in.”

REALITY: Incorrect. By returning spending to below 2008 levels, they are the kind of cuts that tell us we cannot afford the Democrats’ unsustainable spending spree. The president has every right to defend his spending record, but implying that common-sense spending restraint is un-American crossed the line.

Medicare

CLAIM: “[The House Republican budget is] a vision that says America can’t afford to keep the promise we’ve made to care for our seniors.”

REALITY: The president’s commitment to the status quo will end Medicare, period. According to the non-partisan CBO, Medicare will go bankrupt in nine short years. The president announced in his speech that he would rely on strict limitations on how much care seniors could receive in order to achieve savings. Contrary to the president’s opinion, CBO does not believe this would result in lower costs. Current seniors would receive less care through Medicare against a backdrop of relentlessly rising health care costs.

This stands in sharp contrast to the House Republican Budget, which gives seniors the tools to fight back against rising costs by empowering them in a personalized Medicare program, giving future generations the same kinds of health care choices members of Congress now enjoy.

CLAIM: “It says that ten years from now, if you’re a 65 year old who’s eligible for Medicare, you should have to pay nearly $6,400 more than you would today.”

REALITY: This is a false comparison based on a false reality. As mentioned above, the CBO reports that Medicare’s trust fund will become insolvent in nine years unless we act. This would necessitate harsh restrictions on seniors’ access to care – the kind of restrictions that the president himself alluded to later in his speech. The president is taking CBO numbers out of context and omitting the CBO’s clear warnings about Medicare’s impending bankruptcy.
That’s why comparing a Republican plan that saves Medicare to an unsustainable status quo means comparing a real solution with a false reality.The Medicare program as it exists today cannot exist in the future.The real choice is this: Do we act now to protect the program for current seniors while building a strengthened Medicare for future generations? Or do we restrict access to care for current and future seniors, as the president has proposed, while ignoring our crushing burden of debt until it becomes a fiscal crisis?

CLAIM: “It says instead of guaranteed health care, you will get a voucher.”

REALITY: The changes in the House Republican budget will not affect those in and near retirement in any way. When younger workers become eligible for Medicare, they will be able to choose the kind of plan that best suits their needs from a list of Medicare plans that are guaranteed to offer coverage to all beneficiaries regardless of pre-existing conditions. Medicare would then provide a payment to subsidize the cost of the plan. This is not a voucher – it is a payment that flows through to whatever plan recipients choose.

CLAIM: “And if that voucher isn’t worth enough to buy insurance, tough luck – you’re on your own.”

REALITY: Under the House Republican Budget, Medicare will provide increased assistance for lower-income beneficiaries and those with greater health risks, guaranteeing that Medicare will be there for those who need it most. Wealthy seniors will receive less assistance, and the Medicare benefit will grow every year, while using competition to lower costs and make health care for seniors more affordable.

CLAIM: “Put simply, it ends Medicare as we know it.”

REALITY: The president’s plan – a commitment to the status quo – condemns Medicare to a bankrupt future. The greatest threat to the health security of America’s seniors is the president’s plan to deeply and systematically ration Medicare.

Medicaid

CLAIM: “This is a vision that says up to 50 million Americans have to lose their health insurance in order for us to reduce the deficit.”

REALITY: Republicans have a vision for patient-centered health-care that requires the removal of the partisan roadblock to reform that the president and his party’s leaders enacted last year. Our budget repeals the government takeover of health care to make way for reforms that will make health insurance more affordable and accessible for Americans.

Contrary to the president’s false claims that the House Republicans’ Medicaid reform plan would leave millions without coverage, Medicaid spending grows every year under our budget. The Medicaid program is already failing those who need it most, because excessive federal mandates have made it so that the only way for states to control costs in the current system is to lower doctor reimbursement rates. This is why so many doctors refuse to see Medicaid patients. States need to be able to tailor their Medicaid programs to the needs of their unique populations. Our reforms help them create better programs. The president’s approach is just to throw more money at a broken system.

Taxes

CLAIM: “Worst of all, this is a vision that says even though America can’t afford to invest in education or clean energy; even though we can’t afford to care for seniors and poor children, we can somehow afford more than $1 trillion in new tax breaks for the wealthy.”

REALITY: The House Republican budget keeps revenue within its historical range of 18-19 percent of GDP. The president’s distortion is based on the fact that our budget prevents $1 trillion in tax increases. Many Democrats have claimed that our plan includes huge new tax cuts for the rich. This is completely false. Our plan calls for revenue-neutral tax reform along the lines of what the president’s Fiscal Commission proposed – lower rates with a broader base. The president appeared to have endorsed this idea in his speech, but he also called for higher rates. Despite this contradiction on tax policy, the president was clear in his intent to raise taxes again on job creators and American families.

Deficit reduction

CLAIM: “Today, I’m proposing a more balanced approach to achieve $4 trillion in deficit reduction over twelve years. It’s an approach that borrows from the recommendations of the bipartisan Fiscal Commission I appointed last year, and builds on the roughly $1 trillion in deficit reduction I already proposed in my 2012 budget. It’s an approach that puts every kind of spending on the table, but one that protects the middle-class, our promise to seniors, and our investments in the future.”

REALITY: The president’s plan lacks credibility. For one thing, is simply does not put “every kind of spending on the table” – the president ruled out changes to Social Security and exempted 90 percent of all federal spending from his debt-reduction as “failsafe.” For another, the president’s use of a 12-year budget window is bizarre – it is clearly contrived to make the president’s proposal appear to come close to matching the House Republicans’ proposal in terms of deficit reduction, when it actually falls a full trillion dollars short.

Conclusion

The president had an opportunity to reach across the aisle and work with Republicans by putting serious deficit-reduction ideas on the table. Instead, he decided to use this opportunity to kick off his 2012 campaign. It is no wonder that a few days after the president’s speech, rating agency Standard and Poor’s downgraded the U.S. debt outlook to negative, expressing skepticism about the president’s approach and implying that his stated position would make it harder, not easier, for the two parties to reach agreement on a serious plan before the 2012 election.

House Republicans will be here if the president changes his mind and decides that the next generation is more important than the next election. Until then, we will continue to lead.

-Congressman Paul Ryan

Lack of faith in Americans

In addition to the misleading and demonstrably false description of Paul Ryan’s budget and the consequences of his own plan, there is a deeper problem with President Obama’s message, one that reveals a fundamental misunderstanding of American Exceptionalism.

The president pretends to speak in the language of hope, change, optimism and compassion. Scratch the surface of his message, however, and you will see that it reveals a profound cynicism about the character of the nation he leads.

During his speech last week, and at subsequent campaign stops, the president said “The America I know is generous and compassionate.” Yet, in describing the generosity and compassion of America, the president cites government programs instead of the countless acts of charity Americans engage in every day without the involvement of government.

This is a profoundly different view of American compassion than the one experienced by most Americans. Throughout our history, it has been through a strong and vibrant civil society – the actions of charities, churches, civic organizations and associations - that Americans have expressed their compassion, not through big government.

In fact, the founding fathers believed that America’s strong volunteer ethic was essential to defend liberty because civil society fulfills roles that government is always tempted to assume. This puts the big government programs that President Obama and liberals want to preserve and expand profoundly at odds with the traditional American model of limited government and vibrant civil society. As big government expands, civil society gets crowded out by taking more money and resources away from civil society and directs it towards government. It also erodes the sense of personal responsibility Americans feel to take care of themselves and their neighbors by shifting that responsibility to government.

This brings us back to the issue of compassion, which President Obama seems to be setting up to be the aspirational “hope and change” of the 2012 campaign.

The president is trying to argue that Republican plans to reduce government spending reveal they do not believe in a compassionate America. He is 180 degrees wrong.

By placing faith in government, not civil society, to help those Americans in need, it is President Obama and the left who defend and want to expand the big government welfare state and who do not believe in a compassionate America.

Rather than a compassionate American people, the left believes in compassionate politicians compensating for uncompassionate Americans by taking their money and spending it on what they consider more benevolent things.

So when President Obama and the left try to take the moral high ground and say that an America with less big government is not the compassionate America they know, remember it is because their low view of the American people is not the same as what we know is true.

Your Friend,
 
Newt

[Crafty_Dog]

By JOHN B. TAYLOR
Palo Alto, Calif.

Americans are clamoring for a fact-based debate about the budget, but the numbers they're hearing from Washington are terribly confusing. Here's an example: Speaking at a Facebook town hall meeting here on Wednesday, President Obama sometimes talked about saving $4 trillion, at other times $2 trillion, and he varied whether it was over 10 years or 12 years, never mentioning any one year.

A simple chart, like the one nearby, would greatly clarify the debate. It shows total federal government spending year-by-year for the two decades starting in the year 2000. Spending is shown as a percentage of GDP, which is a sensible and quite common way to assess trends: When the percentage rises, government spending rises relative to total income or total goods and services produced in our economy.

For the past decade, the chart shows the recent history of government spending. For the next decade—the window for the current budget—it shows three different spending visions for the future.

The uppermost line shows outlays under the official budget submitted by Mr. Obama to Congress on Feb. 14. The lowest line shows the House Budget Resolution submitted by House Budget Committee Chairman Paul Ryan on April 5, while the third line shows year-by-year outlays I estimated from the 12-year totals in the new budget proposed by the president on April 13.

The chart clearly reveals a number of important facts that are not coming up in town hall meetings. Most obvious is the huge bulge in spending in the past few years. In 2000 spending was 18.2% of GDP. In 2007 it was 19.6%. But in the three years since 2009 it's jumped to an average of 24.4%.

Second, and perhaps even more striking, the chart shows that Mr. Obama, in his budget submitted in February, proposed to make that spending binge permanent. Spending would still be more than 24% of GDP at the end of the budget window in 2021. The administration revealed its preference in the February budget for a much higher level of government spending than the 18.2% of GDP in 2000 or the 19.6% in 2007.

Third, the House budget plan proposed by Rep. Paul Ryan (R., Wis.) simply removes that spending binge—it gradually returns spending as a share of GDP back to a level seen only three years ago.

.View Full Image
..When I show people this chart they ask why Washington is even having the debate. They say: If government agencies and programs functioned with 19% to 20% of GDP in 2007, why is it so hard for them to function with that percentage in 2021, when GDP will be substantially higher and with many opportunities for reforms and increased efficiencies? And if GDP and employment grow more quickly, as they would if private investment increased as a result of lower government spending and debt, then that 19% to 20% share of GDP could provide much more in the way of public goods.

Fourth, the chart shows that the second Obama administration budget, submitted a week after the Ryan House budget, is substantially different from the first administration budget. It is highly unusual for an administration to decide to submit a second budget, and the effect of this revision is to move the administration's spending vision closer to that of the House. But it still leaves a big chunk of the spending binge in place.

Fifth, and perhaps most important for economic growth, the chart shows that the House budget effectively deals with the deficit and brings the debt down as a share of GDP without a tax increase. Under the current tax system, revenues as a share of GDP were 18.5% in 2007, so that the budget deficit was only 1.1% of GDP that year. With higher real incomes moving people into higher tax brackets, it is quite likely that under the current tax system revenues will be higher as a share of GDP when the economy fully recovers, perhaps in the 19% to 20% range.

This means that the House budget plan, with spending in the same range, approximately balances the budget with no increase in taxes. This is good news for economic growth. In contrast, balancing the first or even the second Obama budget requires substantial tax increases—more than the administration has yet to propose.

Mr. Taylor, a professor of economics at Stanford and a senior fellow at the Hoover Institution, is the author of "Getting Off Track: How Government Actions and Interventions Caused, Prolonged and Worsened the Financial Crisis" (Hoover Press, 2009).

[Crafty_Dog]

I'm going to answer BD's proposed budget on this thread, which, now that I think about it seems to me a better place for discussing his proposal (and the rest of ours to come no doubt  ) because it will encourage us to tap into what we already have on this thread:

BD writes:

"about 60% of the discretionary budget is military.  Therefore, we have to start there."

I have two major disagreements with this:

1) National Defense spending in my opinion is of a different category.  Indeed, in my opinion, it is the essence of non-discretionary.  If it needs to be spent, it should be apart from budegetary considerations.  If not, it shouldn't.

2) I disagree with the syllogism in and of itself.  The great majority of our problems are PRECISELY because of what we define as ENTITLEMENTS!!! (i.e. non-discretionary) and then mask with BASELINE BUDGETING.

[bigdog]

I use Congress's definition because Congress passed the law with the description, passes the budget, and raises the money.  You don't have to like the definition, but I will accept it because I am not an activist president.

[Crafty_Dog]

Diagree.  Non-dsicretionary spending is only because some previous Congress said so and some previous president signed it.  We can do the same and make it descretionary again.

If you are not an activist president in this regard you will fail in solving the problem.

[Crafty_Dog]

http://www.mercatornet.com/sheila_liaugminas/view/9565/

[Crafty_Dog]

This article makes much more sense to me, and it is written by a guy who was Bill Clinton's pollster:


http://online.wsj.com/article/SB10001424053111903927204576574513428610454.html?mod=djemEditorialPage_t


Voters Want State Government Reform
By DOUGLAS E. SCHOEN
Americans believe that bold action to restrict spending is necessary to stabilize the finances of state government.

Last month, in a wide-ranging national survey of 1,000 randomly selected, registered voters, and in 10 polls in individual states each with 400 respondents, my polling company found that voters strongly favor measures to pare the compensation of current and future public employees. They strongly oppose higher taxes.

Specifically, over three-quarters (78%) say their state faced a budget crisis this year, and 68% say that the crisis was resolved with spending cuts. Overwhelmingly they blame politicians for creating and exacerbating the problems: 48% say "elected state officials made careless and self-serving decisions," while only 6% say "state governments did not tax enough."

The top priorities for resolving current fiscal issues are to cut government spending (47%) and to ask for greater sacrifice from current public employees, by having them contribute more towards their benefits (31%). By almost two-to-one, they think that current public employees should have to contribute more toward their pension benefits because of budget problems.

A majority (51%) say they would not be willing to cut "social service programs provided by your state" to maintain the compensation of public employees; and 60% say that "education and health care" should not be cut so that "the salaries and benefits of public employees could be paid at current levels."

Further, by 48% to 40%, voters say that public employees' salaries should be "frozen," and they should be required to contribute more towards their benefits when states face the type of crises they are now facing. Close to two-thirds (64%) say they would not be willing to have their taxes raised as a means of keeping salaries and benefits of current employees at current levels.

However, there is a clear distinction in voters' minds between what current public employees should be asked to contribute and what retired public employees should be asked to contribute. Sixty-nine percent say retirees should "not have to" contribute more towards their health-care benefits or take a reduced pension because of state and local government budget problems.

A majority (56%) supports reducing certain state services to address state budget crises if programs need to be cut. Voters are most inclined to cut libraries and parks services and least inclined to cut education, health care, police and fire protection. However, a whopping 60% of voters oppose "increasing state sales, income or other taxes" to reduce budget deficits.

While there is a clear sense that cutting spending and reducing salaries and benefits will result in fiscal stability for state governments, there is no similar linkage between reforming the collective bargaining process and achieving fiscal well-being for individual state governments.

Put simply, the voters don't see a connection between the two.

Collective bargaining is not overwhelmingly popular in the abstract. A majority (50%) agrees that "public employees should not bargain collectively and use union power to limit or delay the delivery of important government services." Moreover, 60% of voters feel that collective bargaining is a benefit "and can be changed and negotiated based on economic circumstances," while 30% see it as "essential" and "a basic right of labor." In the recent "disputes between state governments and public unions over collective bargaining," voters side with state officials by 46% to 39%.



However, this skepticism towards collective bargaining does not translate directly into support for the steps that Governors Scott Walker of Wisconsin and John Kasich of Ohio took in their individual jurisdictions.

Nationally, the Wisconsin law to restrict public employee collective bargaining rights was opposed 49% to 45%, and the similar Ohio legislation was opposed by 45% to 40%. In the states, there was similar opposition. Wisconsin voters oppose Mr. Walker's measure, 52% to 45%, and Ohio voters oppose Mr. Kasich's measure, 52% to 43%.

Yet the reason for this apparent movement against collective bargaining reform is that unlike reducing state spending and benefits, voters nationally and in those two states are not convinced that clear savings will result from reforming the labor relations process. By 56% to 33%, voters nationally say "it is unclear how much money will actually be saved by limiting" collective bargaining rights.

Voters also reject the notion that reforming collective bargaining will make government more efficient in each of these two states. A solid majority (55%) rejects that notion in Wisconsin, and a 45% to 41% plurality in Ohio rejects this notion as well. By large margins in both states—59% to 17% in Ohio and 43% to 28% in Wisconsin—voters say it is more important to reform public employee salaries and benefits than it is to reform collective bargaining.

On other measures that restrict current public employee rights and benefits, voters say that tenure for teachers should be phased out, 56% to 39%. Fundamental reform of public sector pension plans is strongly favored. Voters support "moving all new public employees from a defined benefit plan to a defined contribution plan" by 69% to 17%.

One of the reasons voters feel so strongly about reducing the level of compensation for state employees is that they believe that they are earning disproportionately high wages relative to those in the private sector.

There is a clear belief that public employees are better compensated than those in the private sector: 41% of voters think "the salaries and benefits of most public employees are too high for the work they do," while 32% think they're "about right" and 13% think they're "too low."

Voters also think that while public sector workers generally can retire with full benefits at about age 57 years old, this is too early. Generally they say the normal retirement age should be 65.

It is clear that American voters endorse a very specific agenda to reduce spending, pare back employee benefits, and hold the line on taxes wherever and whenever possible. The electorate clearly shows sympathy with the concept of limiting collective bargaining rights, but so far has not seen or come to accept the direct linkage between restricting that benefit and assuring the ongoing fiscal well-being of their state.

Mr. Schoen, who served as a pollster for President Bill Clinton, is author of "Hopelessly Divided: The New Crisis in American Politics and What It Means for 2012 and Beyond."(Rowman and Littlefield, 2012). The national survey discussed in this op-ed was conducted on Aug. 5-10. The states individually surveyed on Aug. 29-Sept. 5 were Florida, Illinois, Indiana, Michigan, Montana, North Carolina, New York, Ohio, Pennsylvania and Wisconsin. All surveys were conducted for the Manhattan Institute.




On Sep 20, 2011, at 6:24 AM, epo wrote:


 
Is Obama’s proposal winning him reelection?
Bob
 
http://capitalgainsandgames.com/blog/bruce-bartlett/2368/updated-tax-polls
Updated Tax Polls
19 Sep 2011
Posted by Bruce Bartlett

<image001.jpg>
I have previously posted a table showing that people support raising taxes as part of deficit reduction by a 2-to-1 margin over the Grover Norquist/Club for Growth/Tea Party position that the deficit must be reduced only by spending cuts without a penny of higher taxes. In light of President Obama's new budget plan, which includes higher taxes, I am posting an updated table, including a poll on Friday showing that three-fourths of people support higher taxes and only 21 percent support the doctrinaire right-wing position.

Can/Should the Budget Deficit Be Reduced with Spending Cuts Alone or Should There Be Some Increase in Taxes?

 
Poll
 
Date
 
Some/All Taxes
No Taxes/
All Spending
New York Times/CBS News
9-16-11
74
21
Bloomberg
9-14-11
48
38
Associated Press
8-26-11
69
29
Gallup
8-10-11
66
33
CNN
8-10-11
63
36
McClatchy/Marist
8-9-11
68
29
New York Times/CBS News
8-4-11
63
34
CNN
8-2-11
60
40
Ipsos/Reuters
7-26-11
68
19
Rasmussen
7-25-11
56
34
CNN
7-21-11
64
34
Washington Post/ABC News
7-19-11
66
32
NBC News/Wall Street Journal
7-19-11
62
27
CBS News
7-18-11
69
28
Quinnipiac
7-14-11
67
25
Gallup
7-13-11
73
20
Washington Post/ABC News
6-9-11
61
37
Ipsos/Reuters
6-9-11
59
26
Bloomberg
5-13-11
64
33
Ipsos/Reuters
5-12-11
61
27
Gallup
4-29-11
76
20
USC/Los Angeles Times
4-25-11
62
33
New York Times/CBS News
4-22-11
66
19
Washington Post/ABC News
4-20-11
62
36
Washington Post/ABC News
3-15-11
67
31
Washington Post/ABC News
12-12-10
62
36
Associated Press/CNBC
11-26-10
65
33
Average
 
64.5
30
 



Scott Grannis
http://scottgrannis.blogspot.com

[Crafty_Dog]

By GLENN HUBBARD
After two months of talks, the super committee announced failure on Monday to agree on reducing federal deficits by $1.2 trillion over the next decade. But as the late economist Herb Stein once remarked: If something cannot go on forever, it won't. That applies to the mounting budget shortfalls. But how?

President Obama's answer is higher taxes. But he can't be serious. Just accommodating his spending plans over the next decade requires across-the-board tax increases of 20%. Over the next 25 years, taxes would need to rise across the board by 60%.

Instead, what is needed is spending reform that offers goals, specifics and ways to blend fiscal responsibility with modernizing government. This includes near-term action on discretionary spending and longer-term action to reform entitlements and reduce the growth of Social Security and Medicare. Then revenue contributions can be addressed in the context of tax reform.

The first goal is to reduce federal spending to a healthier 20% share of GDP from today's bloated 25% within a decade. A tall order, yes, given the profligacy of the last few years. But it can be accomplished by eliminating unnecessary federal programs, empowering states, and reforming and streamlining government.

The obvious place to begin is repealing ObamaCare and its expansion of spending. Programs like the federal Community Development Fund, which should fall under state and local or private responsibilities, can be axed. So can intercity and high-speed rail grants, which lack plans to make rail competitive, and duplicative education programs.

We should also let states experiment with alternatives to our current one-size-fits-all federal solution. The best example is Medicaid, which should be converted into a block grant. Replacing federal matching support with block grants eliminates state incentives to attract additional federal subsidies, while allowing states to manage Medicaid more efficiently. Federal Medicaid costs should be capped at growth of 1% over the inflation rate.

The federal work force can shrink through attrition, and employee compensation can be adjusted to private levels. We should cut costly applied research in fields such as renewable energy at the Department of Energy, focusing only on basic research. And the Davis-Bacon Act, which inflates the price of federal construction projects by requiring high-cost union labor, has to be repealed.

These three approaches would bring federal spending down to 20% of GDP. Yet as ambitious as they are, these won't solve our long-term budget problems, which reflect yawning deficits in Social Security and Medicare.

Regarding Social Security, the program first needs to be made solvent and sustainable over the long term. In particular, program outlays need to grow more slowly to allow for rising costs in health-care entitlements. Second, we must modernize Social Security by making it more effective in protecting low earners and more conducive to personal saving and the longer work lives needed in today's economy. These changes will require a strong minimum benefit, gradual increases in the retirement age, and slowing benefit growth for more affluent Americans.

As a pro-growth measure, we should also eliminate the Social Security payroll tax for all individuals age 62 and older to encourage individuals to keep working and to increase their attractiveness to employers. In that vein, we should also eliminate the retirement earnings test that reduces benefits for early retirees who continue to work.

Our long-term budget problems are dominated by Medicare's unfunded liabilities of tens of trillions of dollars. But changes must preserve Medicare's role of assisting lower- and moderate-income Americans. As with Social Security, Medicare's eligibility age should be increased gradually, and we should promote work by eliminating the Medicare payroll tax for individuals 62 or older.

A more modern version of traditional Medicare would replace Parts A, B and D with comprehensive benefits including coverage for catastrophic costs and prescription drugs. Simpler cost-sharing would be offered—with one deductible for inpatient and outpatient services and a common coinsurance rate for all services.

Medicare would be placed on a budget through premium support, which would let beneficiaries choose among competing health plans, much like federal employees do now. Subsidies would be larger for lower-income or higher-health-risk individuals. The annual growth would be determined by Congress along with other spending priorities.

And what about taxes? Incorporating revenue increases into forward-looking budget planning requires care. For the plan to be pro-growth, marginal tax rates must not be raised. That leaves base-broadening by reducing tax expenditures and tax preferences. With this in mind, Congress should agree on a revenue target for the decade, then deliver on this target via tax reform.

Merely extending the 2001 and 2003 tax cuts is not the most pro-growth policy. Fundamental tax reform need not be revenue-neutral, as the Bowles-Simpson Commission plan—which would raise net revenue through broadening the tax base—indicates. And reform can be progressive. But tax reform is important for ensuring that deficit reduction promotes economic growth as well as budget austerity.

It is unfortunate that many members of Congress and much of the public don't understand that America's fiscal problems can be solved almost entirely by altering the trajectory of government spending. President Obama's leadership failure here is obvious.

If something cannot go on forever, it will stop. But even with the super committee's failure we may be able to avoid a sudden, calamitous stop—and provide a government worthy of the 21st century for all Americans.

Mr. Hubbard, dean of Columbia Business School, was chairman of the Council of Economic Advisers under President George W. Bush.

[JDN]

Ahhh to be a government worker...  If only private industry had  their protections.....
We would all be broke.

http://www.latimes.com/news/local/la-me-prison-mailroom-20111126,0,2558276.story

[G M]

We are all broke, California in particular.

[Crafty_Dog]

I have queried in this forum as to how much we have been spending via the IMF for the Euro collapse.  This piece answers that (much smaller than I had feared but substantial nonetheless.)  Regardless, this would be a wonderful place to cut spending.
======================


By JIM DEMINT
If the United States wants to help Europe find a way out of its current debt crisis, we must be a strong, world economic leader, not merely the lender of last resort.

American taxpayers sent $40 billion to Greece last year, through the International Monetary Fund, to stave off an economic collapse. But the bailout did not prevent Greece's day of fiscal reckoning. It only delayed it. Austerity measures are still needed throughout Europe's socialized economy and the debt contagion has not been stopped. Financial chaos has spread from Greece to Ireland, Portugal, Italy and Spain, and it now threatens the very future of the 17-member euro zone.

Undeterred, President Obama last month told the press after breaking from a closed-door meeting with European leaders, "the United States stands ready to do our part to help them resolve this issue." He would do better to focus his attention stateside. The most dangerous threat to the U.S. economy is not across the pond. It's in the swampland of Washington, D.C.

The very problems that have roiled Europe's economy are coming to a slow boil in the U.S. Just as European leaders must limit deficit spending, reform unfunded entitlement programs, and resolve the underlying systemic problems in their financial systems, so must the politicians in Washington. Yet the Obama administration is burning taxpayers at each end of the dollar by bailing out failed socialist policies abroad and, at the same time, forcing them into place here at home.

Although every country's finances are unique, the U.S. is unquestionably in the danger zone.

Greece's economy reached its tipping point and was bailed out when government debt topped 137% of its gross domestic product. Despite all the measures that have been taken to aid it, Greece's debt-to-GDP-ratio is even higher now, at 160%. Ireland was bailed out at 74% of GDP and is now at 80%. Portugal was bailed out at 94% of GDP and is now expected to top 100%. The bailouts have arguably made the European debt crisis worse, not better.

Total U.S. debt, including entitlement liabilities, reached 100% of GDP when Congress increased the debt ceiling in August. Our $15 trillion debt now rivals the size of the entire U.S. economy.

Enlarge Image

CloseMartin Kozlowski
 .When he first took office, President Obama promised to cut the federal deficit in half by 2013. But instead he's increased it by more than $4 trillion. Indeed, under his direction, the U.S. government spent about $1 trillion on a Keynesian-style stimulus that failed to create the jobs promised, will spend trillions more creating a European-style health-care entitlement with ObamaCare, and has more Americans on welfare than ever before.

With President Obama in the White House, liberals have succeeded in their longstanding quest to make America more like Europe. Problem is, their idealized version of Europe's collectivist government is now in shambles. If the U.S. continues to mimic our European allies we'll fall to pieces, too.

It is under these circumstances that high-level members of the Obama administration, including the president himself, are negotiating with international leaders over how best to solve the European debt crisis. This week, Treasury Secretary Tim Geithner met central bankers and European leaders days ahead of this Friday's emergency EU summit in Brussels, where a last-ditch rescue effort is expected to be announced. France and Germany are pushing for EU rule changes to enforce stricter budget discipline on member nations in exchange for further bailouts. The International Monetary Fund, which the U.S. funds at a higher percentage than any other nation, is expected to aid the rescue. The only question is how big a role the IMF and U.S. taxpayers will play.

This year the U.S. sent about $67 billion to the IMF, which represents 17.7% of the IMF's yearly budget—nearly three times more than any other nation. On top of that, taxpayers provided an additional $108 billion credit line to the IMF in 2009.

In 2010, the IMF sent nearly $40 billion in assistance to Greece, which did nothing to prevent the country's economic collapse in 2011. On Monday, the IMF approved another $2.95 billion worth of bailout funds for the struggling country.

If this is what President Obama meant when he said the "United States stands ready to do our part," it's time for him to part ways from his European friends seeking the same kind of assistance that has been provided to Greece.

American policy makers must send an unmistakable signal that the era of bailouts is over once and for all.

Earlier this year, I offered an amendment to repeal the IMF's authority to use the additional $108 billion credit line to provide any more bailouts. It was overwhelmingly rejected by the Democrat-controlled Senate. Forty-four senators voted for it; only one was a Democrat.

I will soon give my colleagues another chance by forcing a vote to stop Mr. Geithner from supporting any more taxpayer-funded bailouts of the European economy, as well as nullifying previously expanded IMF bailout authority.

Members of the Obama administration must focus all of their efforts on strengthening the U.S. economy and balancing our budget, rather than on continuing to borrow from China to pay for Europe's out-of-control debts.

President Obama and Mr. Geithner have lectured European leaders on the need for them to take decisive action to stabilize their economies. They should practice what they preach and set a positive example for the world to follow.

Lending isn't leading. Balancing the budget would be.

Mr. DeMint, a Republican, is a senator from South Carolina.

[Crafty_Dog]

I know not the other side of this, but here is POTH on some efforts to cut spending (i.e. increase spending less)

Published: March 9, 2012

The hard-fought deal that settled last year’s debt-ceiling fight made painfully deep cuts in spending, but it promised one thing: a year’s peace from the destructive Congressional battles that led to threats of government shutdowns and defaults. By signing the pact, Republican and Democratic leaders set spending levels for 2013, putting off further budget wars until after the election.

But now a coalition of extreme conservatives in the House wants to break the budget agreement and cut spending below the agreed level, and the House Budget Committee seems willing to go along.

Reneging on the agreement would not only endanger vital programs like Head Start, but it would erase the thin residue of trust left in Congress. It would clearly demonstrate that the current House cannot be trusted to live up to its own pledges.

When Republicans created the debt-ceiling crisis in August, their principal goal was to cut spending, and they got their wish. By threatening a government default, they forced an agreement, negotiated by Speaker John Boehner, that cut $2.3 trillion from the budget over a decade without a dime of new taxes. That includes more than $800 billion cut from nondefense discretionary spending, in vital areas like education, housing assistance, transportation, public health and veterans benefits.

For fiscal year 2013, the agreement set a discretionary spending level of $1.047 trillion. Though far too low, that level at least let appropriators in both the House and Senate know how much they had to spend, and House Republicans crowed about it at the time. “The Budget Control Act represents a victory for those committed to controlling government spending and growing our economy,” said Representative Paul Ryan, the chairman of the House Budget Committee. Now members of the Republican Study Committee, the most right-wing members of the House, want to bring the 2013 level down to $931 billion, an unimaginable 11 percent cut in a single year. House officials say Mr. Ryan’s committee is unlikely to cut that much but could bring 2013 spending down to $1.028 trillion.

That $19 billion cut, on top of the ones already agreed to, could have terrible consequences. Assuming it was applied evenly to all nondefense programs, it would mean that 50,000 children would lose access to Head Start; 20,000 families would lose child-care slots; and 10,500 teachers and their aides would lose their jobs.

With the Senate sticking to the agreed-upon spending limit, a lower House number could lead to a clash between the chambers that raises the prospect of another government shutdown. Democrats say they are furious that the agreement could be undercut. “If House Republicans walk away from the agreement their own speaker made less than a year ago, then they will show that a deal with them isn’t worth the paper it’s printed on,” said Senator Patty Murray, who led the Democrats on the budget “supercommittee” last year. If Mr. Boehner is to retain any credibility as a leader of the House and a responsible lawmaker, he needs to extinguish this rebellion and make it clear that a deal is a deal.

[Crafty_Dog]

http://online.wsj.com/article/SB10001424052702304636404577299720000883712.html?mod=WSJ_Opinion_LEADTop

Its no surprise that the White House has denounced Paul Ryan's new House budget as the end of welfare-state civilization. The puzzle is why some conservatives are taking shots at the best chance in decades for serious government reform.

A pair of freshman Republicans, Tim Huelskamp of Kansas and Justin Amash of Michigan, joined every Democrat in voting against the budget in committee last week, claiming it didn't balance the budget fast enough. The budget passed 19-18, but if the rebellion spreads it will play into the hands of Nancy Pelosi, who wants to show that Republicans can't govern.

Then there's Chris Chocola, the former Member of Congress who now runs the Club for Growth political donors' group, who groused that "on balance" Mr. Ryan's budget is "a disappointment for fiscal conservatives." Mr. Chocola says the proposal doesn't get to balance fast enough and waives the automatic defense cuts from last year's debt-limit deal with President Obama.

The GOP critics are wrong on the economics and politics. Mr. Ryan's plan may not balance the budget within 10 years, but that's the wrong policy guidepost. Mr. Obama can easily balance the budget faster—by raising taxes.

Mr. Ryan wants to avoid a tax increase and reform the tax code because he realizes that the budget will never balance over the long term without economic growth faster than today's 2% a year. By stressing budget balance over growth, Mr. Chocola and the tea-party critics are falling into Mr. Obama's deficit and tax trap.

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House Budget Chairman Rep. Paul Ryan
.They are also playing by the Beltway's big-government budget rules. The critics on the right are judging Mr. Ryan's budget according to Congressional Budget Office estimates that assume little or no economic benefit from better policy. Mr. Ryan's official budget proposal follows CBO scoring, but he is also trying to break out of that straitjacket.

He has also issued a second budget estimate based on evidence from the 1960s, 1980s and 2000s that tax reform and spending restraint will increase GDP by about 0.5 to one percentage point a year. This means the Ryan budget reduces the debt to GDP ratio to 50% in 10 years from 74.2% this year (and heading higher) and thus steers the U.S. away from the Greek fiscal rocks. Since when has the Club for Growth favored static Beltway revenue analysis?

Mr. Ryan is also proposing to cut spending to 19.8% of the economy in 2021 from 24.1% in 2011. That is hardly spendthrift. It will also be hard to pass given the resistance to change in Washington.

But what really matters on spending over the long term is entitlement reform, and on that score Mr. Ryan goes further than any Republican Congress or President since 1995. He understands that without converting Medicare into a market-based program with more choices for seniors, and without devolving Medicaid to the states and repealing ObamaCare, tax increases will soon become the political default option.

The entitlement state wasn't built in a year, and it can only be fixed with reforms that save money over time. Conservatives who really want to limit government should focus on major reform, not on hitting some unlikely balanced budget target in some future year.

As for automatic defense cuts—the so-called sequester—everyone knows those are too draconian to be sustained. That's why Mr. Obama insisted on them. He wants to use them as leverage to get Republicans to raise taxes. Defense is already scheduled to be cut by some $450 billion under the current 10-year budget caps. The sequester would cut an additional 10% from the national security budget in 2013 and roughly another 10% in 2014.

Mr. Ryan's budget would cancel the additional defense cuts of $55 billion a year under the sequester and replace them with savings in the entitlements that are the real drivers of long-term debt. His Medicare and Medicaid reforms would generate future savings many times greater than would be gained from gutting the defense budget. The tea partiers who want to hack away at defense as much as they do at earmarks are going to fracture the GOP coalition in Congress that still contains more than a few defense hawks.

Voters have every reason to be skeptical of Republican promises, but Mr. Ryan's budget is hardly a status quo document. It's light years better than the Tom DeLay budgets of the 2000s.

Mr. Ryan is thinking ahead of his critics by focusing on the two most important priorities: growth and reform. Without both, limited government will be nothing more than a tea party slogan and a balanced budget will be nothing more than a tax-increase trap.

[DougMacG]

Ryan has courage and expertise in a very dry, important subject.  This a serious plan for governing, not a Ron Paul plan where we say cut - no problem, but never get the votes to do it.  The Ryan plan could actually be the blueprint.  Really it is stop tha crazy increases and hold spending within sight while we try to grow the economy.   

They say Ryan would likely accept the VP slot if chosen.  That is a nice option to have available.  I lean toward Rubio at this point.  Save Ryan maybe for Speaker of the House.

[Crafty_Dog]

The next time someone moans about Washington "austerity," tell them about the Senate's food stamp votes on Tuesday. Democrats and a few Republicans united to block even modest reform in a welfare program that has exploded in the last decade and is set to spend $770 billion in the next 10 years.

Yes, $770 billion on a single program. And you wonder why the U.S. had its credit-rating downgraded?

When the food stamp program began in the 1970s, it was designed to help about 1 of 50 Americans who were in severe financial distress. But thanks to eligibility changes first by President George W. Bush as part of the 2002 farm bill and then by President Obama in the 2008 stimulus, food stamps are becoming the latest middle-class entitlement.

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A sign outside of a store in Sioux Falls, S.D., tells customers that food stamps are welcome.
.A record 44.7 million people received food stamps in fiscal 2011, up from 28.2 million as recently as 2008. The cost has more than doubled in that same period, to $78 billion, and is on track to account for 78% of farm bill spending over the next decade. One in seven Americans now qualifies.

Once there was a stigma to going on the dole, and it was seen as a last resort. But now the Agriculture Department runs radio and TV ads prodding people to get the free food, as in a recent campaign that says food stamps will help you lose weight. A federal website boasts about strategies that have "increased program participation" with special emphasis on Hispanics because "our data show that many low-income Latinos simply don't apply for [food stamps] even though they're eligible."

In the 1990s Bill Clinton boasted that welfare reform took Americans off the dole. The Obama Administration boasts about how many it has added.

Enter Alabama Republican Jeff Sessions, who proposed reforms to limit the worst excesses. One proposal would have established a federal asset test to ensure that food stamps aren't going to families that may not have an income but have tens of thousands of dollars in savings or may even live in a million-dollar home. Some 39 states have no real asset test for food stamps, which means wealthy families without anyone in the job market are eligible, and 27 have gross-income limits that are above 130% of the federal poverty guidelines.

That amendment lost 56-43, with every Democrat except Missouri's Claire McCaskill opposing it. New England Republicans Scott Brown, Susan Collins and Olympia Snowe and Nevada's Dean Heller joined the antireformers.

Mr. Sessions also tried to end the preposterous federal policy of paying some $500 million in bonuses to states that sign up more people for food stamps. This is the way government becomes a permanent feedback loop promoting even bigger government. That amendment lost 58-41, with every self-described Democratic "deficit hawk" opposed.

Still to come is an amendment on another egregious practice that lets some 15 states automatically enroll families for food stamps if they get federal home-heating subsidies. Some states mail heating subsidy checks of as little as $1 a month so families can qualify for federal food stamp benefits of as much as $130 a month. That amendment too is expected to fail.

It's true that the recession and feeble recovery have expanded the number of people who need food assistance, but Mr. Sessions's reforms would have harmed no one who really needs help. His amendments would have saved at most some $20 billion over 10 years, which would still leave some three-quarters of a trillion dollars in outlays.

Earlier this year, House Republicans passed their own food stamp reform that will save some $34 billion over a decade. That bill will now go to a House-Senate farm bill conference, and perhaps some savings can be salvaged. But the news in the Senate vote is that the political class still isn't remotely serious about reforming government. The voters are going to have to clean out a lot more spenders in November if they want real change.

[Crafty_Dog]

http://www.theblaze.com/stories/with-fiscal-cliff-looming-obama-orders-raise-for-biden-members-of-congress-other-federal-workers/

[Crafty_Dog]

http://www.nytimes.com/2016/02/09/us/politics/half-built-nuclear-fuel-plant-in-south-carolina-faces-test-on-its-future.html?_r=1

[Crafty_Dog]

http://fullmeasure.news/news/politics/afghan-air

[Crafty_Dog]

http://www.forbes.com/sites/adamandrzejewski/2016/12/23/10-ways-donald-trump-can-cut-waste-our-advice-from-openthebooks-com/#5df5168352b9

[Crafty_Dog]

https://www.washingtonpost.com/business/economy/through-his-budget-a-bottom-line-look-at-trumps-new-washington/2017/03/12/29739206-05be-11e7-b9fa-ed727b644a0b_story.html?utm_term=.94997403db41&wpisrc=nl_most&wpmm=1

[Crafty_Dog]

http://thehill.com/policy/finance/334768-here-are-the-66-programs-eliminated-in-trumps-budget#.WSTP2Sybe7g.facebook

[Crafty_Dog]

http://www.foxnews.com/politics/2018/01/02/mapping-swamp-report-finds-30000-feds-earn-more-than-any-governor.html

[Crafty_Dog]

http://www.aei.org/publication/if-entitlement-reform-is-too-hard-lawmakers-can-take-baby-steps/?mkt_tok=eyJpIjoiTWpkbE5UazVaVEpsTTJFeCIsInQiOiJ1Q0F1ZUhubU9KVVJaUm45ZjRNdHRRajRxbjYya0cyKzEwbkMxVVR3eXkyUlV4MXRhc0ZsZnpFTjN1K2ZLSGlkUUxYdFYrVURmRkVKaERwbGEzMUZiSzFjbU04Qkp4Nm5YXC9aNmxpOUxYTEFcL09qYVUxOUJaU3dRT2JubTV0Zm9DIn0%3D

[Crafty_Dog]

http://thehill.com/homenews/administration/373441-the-federal-programs-trump-proposes-cutting-in-2019-budget?userid=188403

[DougMacG]

http://thehill.com/homenews/administration/373441-the-federal-programs-trump-proposes-cutting-in-2019-budget?userid=188403

Wouldn't it be great if this came true!

It's possible that our friend Dr. Ben Carson is having some quiet success behind the scenes decoupling government and poverty.

[Crafty_Dog]

Presidents budgets are usually DOA and as such tend to contain much posturing.

[Crafty_Dog]

https://www.heritage.org/budget-and-spending/commentary/these-5-changes-would-fix-the-nations-budget-woes?utm_source=THF_Email&utm_medium=email&utm_campaign=TheAgenda&mkt_tok=eyJpIjoiTlRabU1ERmtaVEEyWVdabSIsInQiOiJzcDNla1hNZEc5RFwvVG1sVzlHS0FZbVJIQzc3MTRqQkR6NlZ5V3ZpSEpkeHVYd1czMlAydUNtWThUVmIyR1wvMUxLaENDMjluUHVzbVRBdjBKbWFjMjMrVlhaZk9RSzJwZDRPdGFmZmpieitQWFl0VlorZ21SRk1lRlFiZTc5TUQ4In0%3D