Red Ink Forever

Red Ink Forever

It’s official.   The proposed Obama Federal budget will generate red ink and the US Government deficit will increase every year during the new President’s term.   In fact the Congressional Budget Office (CBO) predicts US Federal deficits of $1 Trillion per year over the next decade.     The complete CBO report is linked here

http://www.cbo.gov/ftpdocs/100xx/doc10014/03-20-PresidentBudget.pdf

The national debt is now $11 Trillion and counting.   With another decade of spend and tax being proposed by Obama Administration and being supported by the majority Democrats in the Congress, the colossal national debt could double in 10 years to over $20,000,000,000,000!       Here is a direct link for more on the deficit:

http://www.federalbudget.com/

According to the CBO, as report by the Associated Press www.ap.org  President Barack Obama's budget would generate deficits averaging almost $1 trillion a year over the next decade, according to the latest congressional estimates, significantly worse than predicted by the White House just last month.   The Congressional Budget Office figures, obtained by The Associated Press Friday, predict Obama's budget will produce $9.3 trillion worth of red ink over 2010-2019. That's $2.3 trillion worse than the White House predicted in its budget.  Worst of all, CBO says the deficit under Obama's policies would never go below 4 percent of the size of the economy; figures that economists agree are unsustainable. By the end of the decade, the deficit would exceed 5 percent of gross domestic product, a dangerously high level.

The AP also reports that conservative “Blue Dog Democrats” are questioning the larger that life spending proposed by President Obama:

WASHINGTON (www.ap.org ) — “Conservative and moderate Democrats are flexing their muscles on Capitol Hill, demanding significantly lower spending for domestic programs as well as automatic budget cuts if tax cuts and new programs would increase the deficit.

A group of 51 so-called "Blue Dog" House Democrats released their roster of budget demands Thursday, calling for cutting more than $40 billion from domestic programs funded by Congress each year.”

In the Hill on-line version  www.thehill.com  concerns about the ballooning deficit all even alarming the Democrat majority, “The deficit level, which Obama expected to be 12 percent of gross domestic product this year, would fall to approximately 3 percent of GDP in 2013 and beyond under the president's policies. But the CBO estimated deficits in those years to be much larger, between 4 percent and 6 percent of economic growth.  The Office of Management & Budget (OMB) director Orszag said that a deficit that amounted to 5 percent of GDP would be "unsustainable."

The top Republican on the House budget committee Rep. Paul Ryan (Wis.), said that the new projections show that Obama's budget "will lead our nation into a far worse fiscal catastrophe" than the White House's own numbers suggested.

Janet Hook, in the March 20^th LA Times www.latimes.com reports:  “That bad (deficit) news, combined with other recent developments, portends a rocky road for the Obama budget, which was initially hailed by congressional Democrats for promoting such liberal priorities as expanded access to health insurance and curbs on global warming.

 

In the three weeks since the budget was unveiled, fiscally conservative Democrats have raised concerns about proposed spending increases. Leaders of the House and Senate tax-writing committees have criticized some of Obama's proposed tax increases on wealthier Americans. And influential Democrats are backing away from using a legislative shortcut that may be Obama's best hope for passing his far-reaching health and energy policies.

 

An additional multibillion-dollar bailout for banks and other financial institutions, which the administration will soon propose, is expected to add more pressure to the federal government's finances.  Into that tinderbox, a lit match has come from new deficit estimates.  Where Obama's budget foresees rolling up $7 trillion in cumulative deficits over the next 10 years, Sen. Kent Conrad (D-N.D.) on Thursday pegged the deficits at $1.6 trillion higher over that period.”   www.latimes.com

As the FY 2010 budget debate begins on Capitol Hill, the majority Democrats in Congress are faced with the reality that the Obama budget is overspending and over committing the Federal government to programs that cannot be sustained, even if taxes on all of Americans are dramatically raised.    And while the President is only beginning his term, a number of US Senators and all the House members face an increasingly skeptical and angry electorate in November 2010.   It is becoming increasingly clear that for the majority in Congress to continue to blaming others, each other and past Administrations,  will not fly with the US taxpayers.    The November 2010 election may be the last chance to vote out the big spenders in Washington.   In the meantime, it is clear that the big spender in the White House, who doesn’t stand for election until 2012, won’t use the Obama veto pen on earmarks, pork, overspending or tax increases.   

For more details on the US Federal budget, click through to http://en.wikipedia.org/wiki/United_States_federal_budget

© 2009, Jasper Welch, Four Corners Media, www.jasperwelch.org

 

Other Peoples Money: Let's Just Soak the Rich 10.13.08

Other People’s Money (OPM) is always easier to spend than your own money.  And tax spenders (most of those in Washington, your State Capital or your local City or County government) are always looking for ways (called programs, rescues, infrastructure, or public works) to spend OPM on their projects.   And since, through the election process, these tax spenders were elected, the taxpayer is expected to just stay calm as the OPM (your hard earned tax money) is spent.   But if the tax spenders (particularly those in Washington DC) can change the terminology by using words such as “a next tax cut” or “refundable tax credits”, then the taxpayer may think that the check they could receive or the tax cut they may enjoy, will cost nothing and everything will be fine.  This is what Senator Obama is promising, as he seeks to buy your vote with other taxpayers money.

Warning:  Overspending in Washington will lead to a) new taxes, b) additional Federal debt, c) less of your money due to tax increases and/or higher interest rates.   Warning:  Taxing the rich is the Democrat mantra, being chanted by Obama and his legions of believers, coupled with a mythical “tax cut” for 95% of Americans.  This tax spender slight of hand would appear to most taxpayers as a good deal on the face.  But turn over the coin and what is on the other side? 

            In the Wall Street Journal  www.wsj.com  on the Opinion Page of October 13, 2008, the following appeared:

“The Tax Foundation www.taxfoundation.org  estimates that under the Obama plan 63 million Americans, or 44% of all tax filers, would have no income tax liability and most of those would get a check from the IRS each year. The Heritage Foundation's Center for Data Analysis estimates that by 2011, under the Obama plan, an additional 10 million filers would pay zero taxes while cashing checks from the IRS.

The total annual expenditures on refundable "tax credits" would rise over the next 10 years by $647 billion to $1.054 trillion, according to the Tax Policy Center. This means that the tax-credit welfare state would soon cost four times actual cash welfare. By redefining such income payments as "tax credits," the Obama campaign also redefines them away as a tax share of GDP. Presto, the federal tax burden looks much smaller than it really is.” 

            To quote the Tax Foundation (Obama’s Redistribution Plan, Fiscal Note #132, June 25, 2008): “In short, the Obama plan would redistribute more than $131 billion per year from the top 1 percent of taxpayers to all other taxpayers. In 2009, for example, Tax Policy Center figures show that after the income shifting in the Obama plan, the top 1 percent of taxpayers would pay a greater share of the total federal tax burden than the bottom 80 percent of Americans combined. In other words, 1.13 million Americans would pay more in all federal taxes than 128 million of their fellow citizens combined.”

Blogger note:  According to the liberals this is “fair taxation”.   In the opinion on this conservative, this Obama plan is “redistribution of wealth”.   Key those words into Google www.google.com  and see what other words come up:  Marxism, Communism and South Africa.    America or economic prosperity doesn’t appear.

            But aren’t those rich people idle ladies and gentleman, that according to Senator Biden have a patriotic duty to pay more taxes?   While “taxing the rich” makes for good class warfare rhetoric, it also makes for poor economic and tax policy.   In 2004, small business owners paid 54% of all individual income taxes.   So the “soak the rich” approach to tax policy ends up taxing small businesses, who create most of the new jobs in America.   These are the same small businesses that risk their time, money and effort to build the US economy and create jobs, one small business at a time.  

            To offer straight talk to the American taxpayer: Increasing the Federal income tax rates for the highest income tax payers (top 5%), and “redistributing the wealth” the rest of the tax payers is call socialism.  Giving checks to those who pay no Federal income taxes is called welfare, not a tax cut.  Increasing individual tax rates on top 5% of income earners, increasing capital gains taxes on investments and keeping US corporate taxes the 2^nd highest in the world is a recipe for slowing US economic growth, reducing new job creation and reducing owners and workers compensation.   But what the heck, it is just “Other People’s Money”.   

(c) 2008,  Jasper Welch, Four Corners Media   www.jasperwelch.org