If we manage to escape the economic catastrophe that is ObamaCare, we may breathe a little easier, but watch the horizon for a storm is brewing that makes the health care monstrosity look like pin money.

Unions have long been in decline in private industry, but recently for the first time union membership in the public sector surpassed that in the private sector, and it is still growing.  We all know the stories about municipal workers working for 20 or 30 years, then retiring at 50% to 90% of their last year’s pay which is often inflated with heavy overtime, and then they go out and get another job where they work until retirement and a cushy life of a public pension, a handsome private 401k, and Social Security.

It used to be that it was a trade off that government workers (teachers, cops, firefighters, sanitation workers, clerical) got great benefits because they were paid poorly when compared to the private sector.  However that is no longer the case as reported in USA Today:

 USA Today reported that nearly one in five federal government employees now earn over $100,000. The paper also reported the average federal salary rose to $71,260, almost $31,000 more than the comparative average private-sector wage. 

If that doesn’t get the hair on the back of your neck to stand up as, after all you are who pays for these salaries and benefits, then perhaps this will from National Review’s March 8, 2010 issue:

The highest-paid municipal employee in Madison, Wis., is bus driver John E. Nelson, whose salary last year totaled more than $159,000. Half a dozen of his fellow drivers also earned in six figures. How is this possible? The Wisconsin State Journal explains:“A high base salary and other benefits for drivers were largely setin the 1970s and 1980s, when the city took over the bus company.” Combine that with generous, federally mandated leave provisions that make for lots of overtime, and it’s not unusual for a bus driver to out-earn the mayor (and with much better job security). In the 1950s, Ralph Kramden of The Honeymooners was paid $62 a week by the skinflints at the Gotham Bus Company; he was constantly hatching schemes to strike it rich so he could quit. Today Kramden’s dreams of avarice would have been a lot simpler: get a government job and join a union. — The Week, “National Review,” March 8 , 2010

$159,000 for driving a bus.  Imagine.  I wonder what the private bus company was paying their drivers before the city took them over?  I am sure, like ObamaCare, the takeover was a cost savings measure.  After all, those greedy private companies are out to make a profit. 

Who was the most frequent visitor to the White House  at the time the White House released its visitor logs?  It was Andy Stern, president of the Service Employees International Union (government workers), which should tell you where this is going.  Remember, as well, that when the federal government took over GM and Chrysler they gave huge percentages of those companies to the unions.  So when it comes time to negotiate the next contracts the union will sit on both sides of the bargaining table, as management and labor.  How will that turn out?  It will be one of two ways, either the union will have an epiphany and realize that profits are important to staying employed, or the unions will pick the bones of GM and Chrysler clean, driving them out of business and leaving you and me, brother, holding the bag.

The Ticking Pension Bomb

The killer, however, is unfunded pension liabilities.  All those pensions that we will be paying for with retirees being retired for longer than they worked in many cases, will be like nothing we have imagined before from a fiscal crisis standpoint.  In private industry as businesses learned to appreciate the value of their human assets, they treated them accordingly and the unions withered.  However in the public sector we have elected officials writing laws, e.g., Davis Bacon, that heavily favor or require union labor.  Unions in turn, pour millions into making sure those same politicians get re-elected.  Who is looking out for you and me?  As the ultimate employers of government employees, how about a law that union contracts must be ratified by the public at the ballot box?  Too cumbersome?  Okay, how about a law that government employees cannot receive salaries and benefits that exceed what the average private employee (the public employees’ bosses) receives in that geographical area?

Tea Party Members, are you listening?

It is clear from the present administration that the statists believe that it is their destiny to rule, not govern, over the masses who they believe are their intellectual inferiors.  Keep piling it on, but don’t worry we can always tax the rich to pay for it.  But as you board that bus in Madison Wisconsin, ask yourself if Mr. Nelson behind the wheel, is the rich guy picking up the tab or is it you?  Watch out folks, if we don’t do something soon, the rich won’t be rich enough to pay for it even if we tax them at 100% and there is no law to stop them from taking their wealth and moving somewhere else where taxes are lower.  And at this rate there are a lot of places in the world where the taxes are lower.

The US Postal Service is contemplating increasing postage rates and eliminating Saturday delivery.  Really?  They lost approximately $4 billion last year.  But don’t worry the CEO got a bonus.  It is reported that their labor costs, heavily unionized, exceed 80% of revenues.  Did you know that the only place where unionization is growing is in the public sector?  Union representation in the public sector surpassed the private sector for the first time this year.

But don’t worry, President Obama has a handle on it.  He appointed Andy Stern, president of the Service Employees International Union to the board to figure out how to reduce the deficit.  Do you see a problem between these two news items?  Can you see a problem with the objectives of an Andy Stern and you and me?

As a side note, Rick Perry just won the Republican primary for governor of Texas and in his campaign he used no yard signs, no phone banks, and no direct mail.  As one comentator said “paper is dead.”

I know this is completely anecdotal, but my local post office just completed an expansion project increasing the size of the building.  I have noticed more than one post office being expanded as well.  Again, this is just my limited, personal observation, not a scientific study, but with the drop in mail volume, “paper is dead”, $4 billion in losses, performance bonuses for lackluster performance, heavy unionization, am I being unreasonable in thinking the government couldn’t handle health care even if it was a good idea?

As President Obama said while campaigning to be President of the United States, “You can put lipstick on a pig, but it’s still a pig!”  How true.  Yesterday President Obama reached for the lipstick to dab on four proposals suggested by the Republicans to the massive pig of a health care proposal clinging to life.  The four proposals are:

1. Use undercover medical professionals to conduct investigations to fight waste and fraud in Medicare, Medicaid and other Federal programs.
2. “Demonstrations of Alternatives” to the current malpractice mess.
3. Increasing doctor reimbursement for Medicare.
4. Expanding Heath Savings Accounts (HSA).

The pig smiled.  She thought she looked beautiful.  Just don’t try to put a bikini on her because, as President Obama famously said, she’s still a pig.  Let’s look at the President’s magnanamous attempt at bipartisanship in detail.

1)  Undercover Medical Professionals to Uncover Fraud

It is estimated that somewhere in the neighborhood of $100 billion is lost or stolen each year from Medicare and Medicaid.  This program has been in place for 40 years.  If those numbers are consistent over that period, that’s $4 TRILLION.  Gone. Stolen from you and me.  How much better shape would we be in if we had that money back?  That’s government efficiency for you.

The President of the United States is the chief law enforcement officer in the country.  The amount of Medicaid and Mediecare losses each year are four times the entire budget of the Department of Justice.  How’s this for a proposal?  Create a Medicare/Medicaid fraud unit within the FBI and fund it so that we can stop thses losses.  If you stop the fraud, it’s free money.  What you save in fraud should more than pay for the FBI funding.  Why take medical professionals and give them law enforcement duties.  Are you going to ask police to operate on you?  Mr. President it’s your job to enforce the laws and prevent this widespread fraud.  You don’t need a new act of Congress.  Just Do It!

2) Tort Reform –No; “Demonstrations of Alternatives” — Yes

Trial lawyers are one of the biggest contributors to the Democratic Party.  Do you think such “Demonstrations of Alternatives” will amount to anything other than hush money?  “Shut up , we’re looking into tort reform.”  The counter argument is that Americans have a right to their day in court when they have been injured.  True enough, and I am reluctant to arbitrarily limit their awards through a fixed dollar limit.  I would take aim squarely at the lawyers.

John Edwards, one-time Senator and presidential candidate, was involved in about 63 cases as a personal injury attorney and amassed a fortune of about $70 million.  In one particular case, he stood before the jury and took on the persona of a child in the womb crying out for oxygen to appeal to the emotions of the jury and win the case.  Oddly enough he voted against a ban on partial birth abortion.  Gee, in the once case it’s a child who can actually speak while still in the womb!  But on the other hand it is just a mass of tissue at birth that can be disposed of with the trash.  We have learned a lot about the moral character of John Edwards.  He is the poster boy for the old joke, “How do you know a lawyer is lying?  His lips are moving.”

Here is a simple solution to tort reform.  Fixed fees for attorneys and loser pays.  The lawyers should set their hourly rate and bill according to hours worked, not how much they can squeeze out of the jury.  The award should be for the benefit of the injured party, not the lawyer.  The second part is to prevent frivolous lawsuits.  The loser pays the legal fees of the winner.  The argument here will be that the tables will be turned and no one will sue corporations for damages because of the risk of paying their legal fees.  Right now lawyers are running a lottery fishing for lawsuits of any kind becasue they know that most corporations will settle for less than it would cost to defend the suit, even if they know they are right.  All customers of that corporation pay more for their products (e.g., drugs, medical devices) and the lawyer gets rich.  I am sure that if such a proposal as this gets passed a new market for “legal fee insurance” will open up where a plaintiff with a strong case can buy insurance to cover the cost of the other sides legal fees if they do lose.

3) Increasing Doctor Reimbursement for Medicare

So much for bending the cost curve down.  The real way to curtail spending on health care is to eliminate 3rd party payers.  (see It can be done).

4)  Increase Health Savings Accounts

These plans exist today, however, they are not all available across state lines (see It can be done).  I had such a plan in New York while employed by a company, but when I went out on my own I could not buy the same plan in New York State.  We don’t need ObamaCare, we just need states to allow these plans to exist within their borders or allow individuals to buy across state lines.

The Pig Lives!

Three of the  four Republican proposals that Presidident Obama likes don’t cost anything.  But he $1 trillion to $2 trillion health care castastrophe is still alive and until we slay that beast and start over we will go from a serious health care problem to a fiscal crisis and end up with both.  If you don’t believe me, read how the model for ObamaCare is working in Massachusetts.

In baseball they call it a brush back pitch, a high hard one.  It lets the batter know that they don’t own home plate, and if they try to get too comfortable there they may be inviting a little “chin music.”  Jim Bunning, Republican Senator from Kentucky and a Hall of Fame baseball pitcher with a perfect game on his resume, just gave the Democrats a brush back and they don’t like it one bit.

Out of Control Spending

You would have to be Rip Van Winkle not to know that spending is out of control  and America is speeding toward bankruptcy.  President Obama and Nancy Pelosi have tried to hoodwink the country by implementing what is called “Paygo” short for Pay As You Go.  The idea is that you cannot spend money without first funding it either through cutting speding somewhere else or raising taxes.  The last element is the real reason Democrats support it, so that they would be “forced” to raise taxes.  Here is how the Wall Street Journal described Paygo back in January.

The truth is that paygo is the kind of budget gimmick that gives gimmickry a bad name. As Mr. Obama knows but won’t tell voters, paygo only applies to new or expanded entitlement programs, not to existing programs such as Medicare, this year growing at a 9.2% annual rate. Nor does paygo apply to discretionary spending, set to hit $1.4 trillion in fiscal 2010, or 40% of the budget.

The Democrats passed Paygo to appear fiscally responsible.  Jim Bunning merely called them on it.  He is not opposed to spending the money.  He has the courage, though, to stand up and say, Mr. President we’re broke, and we are accountable to the American people to be good stewards of the money they give us to run this government.

“If we can’t find $10 billion to pay for something that we all support, we will never pay for anything on the floor of this U.S. Senate,” he said. – Jim Bunning, Floor of the U.S. Senate, 3/1/2010

Immediately was heard much wailing an gnashing of teeth, that the lone Republican, had the temerity to challenge the “flexibility” of the Democrats to apply their rules willy nilly to tighten their grip on their power while trying to appear like the kindly nannies they really are.  Rules are passed to much fanfare in front of the cameras and then ignored with a scoff or a sneer, when they really mean something.

Gimmicks Instead of Guts

Democrats have proved uncapable of controlling their spending.  With the mad push of profligacy that came with winning the Presidency and both houses of Congress with large margins, they now find themselves unable to dial it back without an intervention or a rehabilitation program.  So they pass Paygo, and ignore it; convene a debt reduction commission and name Andy Stern of the SEIU union to it.  If that is not a clue to what’s coming I don’t know what is.  What does a labor union president know about reducing debt?  All they know how to do is take someone else’s money and put it in their own pockets, so you can bet their solution to the debt problem is taxing you to the eyeballs.

Rather than the scorn that is being heaped upon him, Senator Bunning deserves our thanks.  Find the money first, then spend it.  Enough of the IOUs.  We cannot afford this liberal spending binge.

Stand strong, Senator, the Tea Party Patriots hear you and help is on the way.

You hear a lot of talk these days about the Senate being broken because nothing can get passed with a majority vote.  Everything has to get sixty votes to pass and that’s just un-American.  Is it? 

The House of Representatives

The Founding Fathers were brilliant in designing the government that has survived longer than any other, and it wasn’t an accident.  The House of Representatives was designed to be the branch of government closest to the people.  The members come from districts that are sized based on population.  It is also in the House of Representatives that all revenue bills (i.e., tax increases) must originate.  The Senate cannot create legislation to raise taxes. 

The Senate

 The Senate was designed with a different purpose in mind.  In the form of federalism that they created, the Senate was supposed to represent the individual states.  Originally Senators were appointed by the state legislatures and this continued until the ratification of the Seventeenth Amendment in 1913, which provided for the direct election of Senators by the people.  The Senate was designed to be a check on the tyranny of the majority.  In the House, populous states like New York, California, Texas and Florida, have a lot of representation.  To prevent a handful of states from pushing around everyone else, representation in the Senate is the same for Rhode Island as it is for California, two each.  In the House, California trumps Rhode Island.  In the Senate they do not.  Are you picking up the theme?

 The Dreaded Filibuster

Being able to filibuster in the Senate is another way of allowing cooler heads to prevail.  If legislation before the Senate cannot win over some reasonable number of Senators, then it’s probably not a very good idea for the country.

 As proof that things are more partisan today, pundits point to how the number of filibusters has greatly increased over time. 

 In the entire 19th century, including the struggle against slavery, fewer than two dozen filibusters were mounted. 

 It is reported that things really took off during the Clinton administration.  Hmm, what else was going on then… Hillary Care?  We have also seen the out of control growth of the federal government’s involvement in almost every aspect of our lives, such as, how much we can be paid, how much a bushel of wheat should cost, how schools are funded; none of which is in the Constitution as powers the federal government should have.  Those are all things that, according to the 10^th Amendment, are the purview of the states or the people.

 The Filibuster Fix

So if you don’t like the way the Senate is bogged down, instead of taking the brakes off the car, how about dumping the junk in the trunk?  The less minutia the federal government gets involved in (let’s start with health care), the less reason, reasonable Senators will have to filibuster.

President Obama has just created a panel to figure out how to get our debt under control.  Even when he makes a decision, such as this one, it is to pass the buck to someone else to do the heavy lifting.  His attempt to overhaul health care turned into the Harry and Nancy Show.  Obama campaigned and gave speeches while Pelosi and Reid shut out the Republicans and created the bill that could not be passed.  Obama is now trying to put lipstick on that pig, by calling for a bipartisan meeting.  But instead of starting over and getting ideas from everyone, they are basically going to pick over the stinking corpse of the bill that the Democrats could not get passed.  It is obvious that the real objective is to either get some Republicans to sign on or to use the meeting as a club to beat the Republicans as the “party of No.”

Stop Me Before I Spend

This president can’t seem to control himself and he finds that he painted himself into a corner.  If he tries to raise taxes on those who make less than $250,000 per year he will be breaking a major campaign promise.  If he stops spending on his own, he will lose the left which is about the only support he has remaining.  So he calls in Alan Simpson and Erskine Bowles to co-chair a committee charged with making the president a tailor made fig leaf, to allow him to cut spending and raise taxes, while shrugging his shoulders and saying, “I can’t go a gainst the excellent advice of this august commission.”

If he wants to cut spending, he can just cut spending.  He doesn’t need a commission to do so.  How about an across the board spending freeze, except for national defense, until the the economy grows enough to balance the budget and not with gimmicks like increasing discretionary spending now 24% and then saying you will freeze that same spending for the next threee years?  How about freezing government hiring?  How about returning $500 billion in unspent stimulus money and $400 billion in repaid TARP money, plus interest, to the Treasury?  Don’t hold your breath.  That would require someone with executive experience who knows how to make a decision, rather than deliberating, like a legislator.  Sarah Palin comes to mind, as does George Bush (I & II), Bill Clinton, Ronald Reagan.  These experienced executives knew how to put together a budget and make decisions.  Chris Christie in New Jersey was just sworn in last month as governor and he immediately identified the problem as too much spending and got to work cutting it back.  All that President Obama seems to know how to do is talk. 

If we start advertising now, we may get enough resumes to review to find a replacement by 2012.

A recent article in the New York Times, “Once Stigmatized, Food Stamps Find Acceptance,” talks about how Food Stamps are now, thankfully, accepted and people can get the help they deserve. 

I remember the first time I encounteed food stamps.  I was in line at the grocery store behind a woman with a cart piled high and among its contents were soda, potato chips, and other tasty luxuries.  When the bill was tallied, she took out her book of food stamps and handed them to the cashier.  I related this story to a friend who told me that you can’t use food stamps on junk food so it must have been applied against the other items in the cart.  Even so, I thought back to when I grew up.  We weren’t poor but we were no where near rich.  Things like soda and potato chips were a rarity reserved only for those times when relatives were coming from a distance for a visit.  Otherwise it was home brewed ice tea and supermarket generic cookies.  But even those treats weren’t purchased through a subsidy of our food staples.

New York is now actively reecruiting new food stamp recipients in all languages imaginable.  It seems that it is not enough to provide the service but you have to make sure that everyone who can get food stamps is taking advantage of them.  Let’s see, government employees paid by taxpayers going all out to make sure that a taxpayer funded program is using as much taxpayer money as possible including a program on Rikers Island (the city jail) to enroll inmates as the leave.  The article describes one woman who was actively recruited to join the program:

A big woman with a broad smile, Ms. Bostick-Thomas swept into the group’s office a few days later, talking up her daughters’ college degrees and bemoaning the cost of oxtail meat.

“I’m not saying I go hungry,” Ms. Bostick-Thomas said. “But I can’t always eat what I want.”

Okay, I’m going to go out on a limb here.  By a “big woman” can we take that observation to mean she is not lacking in caloric intake?  She says she doesn’t go hungry.  She talks about her daughter’s college degrees.  So why are taxpayers tasked with helping her eat what she wants?  And what is that anyway?  Steak? Lobster?  Twinkies?  Ice cream?  Why aren’t the daughters with their college degrees helping their mother?  Maybe they could invite her over once a week and feed her the foods she favors?  And if they are not local, why not ship her a box of Omaha Steaks?  Why does some other taxpayer have to pick up the tab for her after they worked hard to feed their own family?

The Other Side of the Coin

On the other side of the coin, from the budget of the same Department of Agriculture, we pay farmers not to grow food in the form of farm subsidies.  Why?  Well, if we didn’t, the prices of farm products, aka food, would become too cheap for the farmers to make a decent living.  In my simple economic model of supply and demand that would seem to indicate that maybe we have more farmers than we need.  But you see farming is a way of life as much as it is an occupation, and taxpayers must be sensitive to preserving that way of life whether or not it is economically justified.  I am sure there are several million unemployed people in this country who would like to have their jobs subsidized.  Unemployment compensation is when the government gives you a check (actually its funded by your employer) when you lose your job.  Farm subsidies are when the government (no employer funding here) pays farmers to keep working at their job.

Add to that another government program to pay farmers to produce corn to make ethanol, another uneconomic subsidy.  Ethanol is pitched as a substitute for gasoline, but it takes a lot of energy to make it, it cannot be transported via pipeline like petroleum products, and when the corn is diverted to produce ethanol, the cost of almost all food goes up.  Corn is used for feed for cattle, as seed to produce corn, for corn syrup as a sweeter.  So on top of regular farm subsidies, we have ethanol subsidies to further drive up food prices.  In the case of corn syrup, sugar could be a substitute, but our government places a very high tariff on imported sugar, to protect our domestic sugar producers.

Coming Full Circle

So, on the one hand we have several government programs, funded by taxpayers, that drive up the price of food.  Then we have another program, taxpayer funded, to help people buy food because food is too expensive.  And then we have government workers and programs, taxpayer funded, that are actively marketing the food stamp program to overweight people, who never go hungry, have college educated children who could help them but don’t seem to, so that the recipient can eat the things she wants to.  But if you see a problem with this, don’t worry.  Michele Obama is about to use more taxpayer dollars to launch a program to fight childhood obesity.  Can we get off this Merry-Go-Round?

How about we shut down the Department of Agriculture?  It’s function is not in the Constitution and so it should not exist at the federal level.  End farm subsidies.  If that means we have a few less farmers, so be it.  The American people do not owe anyone other than themselves a way of life.  To the farmer who can make it, you have my complete admiration.  End ethanol subsidies.  If ethannol is a viable fuel, it should be able succed on its own, not because Archer Daniels Midland spends millions on agricultural lobbyists. Negotiate free trade agreements so that our successful farmers, instead of being paid not to produce, produce and sell their goods around the world.  Likewise end high tariffs that protect our farm products.  These steps should lower the cost of food.

With lower food costs we shouldn’t need a food stamp program.  End it at the federal level along with the Department of Agriculture. If there continues to be a need it will probably be a much smaller one and let each state decide if it wants to start its own program.  Also, with everyone saving on food there is a greater liklihood for people to contribute to food banks to help the truly needy.  But to have one government program create a problem and another government program to try to solve it is lunacy.

With our economy hurtling toward a cliff with out of control spending, we don’t need to be on both sides of a problem.

When will our President come to the realization that the government does not have any money save that which is provided by its citizens?  If he understood that, he wouldn’t have said this:

“Just as it would be a terrible mistake to borrow against our children’s future to pay our way today, it would be equally wrong to neglect their future by failing to invest in areas that will determine our economic success in this new century,” Mr. Obama said at the White House.

Let me posit a translation: we shouldn’t borrow against our children’s future, so we should borrow against our children’s future.  And let me add another pet peeve and that is how the statists have redefined the word “invest”.  What they really mean is spend, but invest sounds so much more grown up.  However, most intelligent people understand invest to mean when you put your money into something with the belief you will get all your money back plus a premium.  You don’t invest in the stock market with the idea you will never see your money again and will subsequently put more money into it next year.  You invest in a house with the idea that you will sell it later for more money.  You don’t invest in a house if you expect it to go down in value.  But our elected representatives would have you believe that pouring money down a rat hole is an investment.

Immature and Irresponsible

Like a child caught standing over his mother’s prized china lying shattered on the floor, President Obama wants us to believe it’s not his fault, no, we are going to have trillion dollar plus deficits for the next ten years because of Bush and the Republicans.  He is one year into his presidency.  This is his budget, not Bush’s.  If he can’t handle the job he should resign and turn it over to, er, Biden?  Check that.  Perhaps he can just go watch television in the White House for the next three years and leave the rest of us alone.  Doing nothing would cause less damage than what he has planned.  He jacked up spending 24% and then “courageously” instituted a freeze on that spending for three years.  Think about it.  If I gave you a 24% raise on Monday and then came back on Friday and said, “Gee, I’m really sorry to have to do this, but times are really tough.  I’m going to have to freeze your new salary for the next three years.  Can you ever forgive me?”  Could you not burst out laughing?

We’re Going to Make Some Tough Decisions…Next Year

We are in a fiscal crisis, but don’t think for a moment you are going to see any tough decisions in an election year, particularly when so many Democrats are in danger of having to find jobs in the real world.  So this year is tough talk.  Next year we get busy!

Democrats or Republicans or maybe the Tea Party movement is going to have to act, sooner rather than later.  Here is how the federal government breaks down:

• Medicare and Medicaid — 33%
• Social Security — 21%
• Interest on the Debt — 8%
• Defense — 20%
• Non-Defense Discretionary — 18%

The first three items continue to grow with no signs of slowing and interest will really take off when the Fed stops the easy money program.  Defense can shrink as Iraq and Afghanistan stabilize, but not a lot as this is still job number one for the federal government.  So do you see the problem?  You can thank Democratic President Lyndon Baines Johnson for the first ticking time bomb above.  You can thank Democratic President Franklin Delano Roosevelt for the second ticking time bomb.  You can now thank President Barack Obama for what is becoming the third ticking time bomb and that is without his Health Care, and Cap and Trade.

So how is President Obama going to “solve” this problem?  By tinkering with the last item, Non-Defense Discretionary spending.  But don’t worry, he will also tax those evil rich and make sure they pay their fair share.  But before he goes too far down that path I have a suggestion for him:

1. Listen closely to the Beatles song “Taxman“
2. Ask yourself why the members of the band moved to the United States?

High tax states like New York and California are finding that a significant number of their wealthy citizenry are moving to lower tax states, exacerbating those states’ fiscal problems.  If you look at the percentage of the population that pays the lion’s share of the taxes you will quickly see that if a relatively small percentage of the population, who can afford to live anywhere, actually decide to leave the United States of Tax the Rich, the resulting fiscal problem will be very, very severe. Obama can only poke his tax stick in that cage so long before he gets a nasty reaction.

We’re All Standing On the Third Rail

Social Security has been called the third rail of politics, but the reality is that we are all standing on the third rail trying to keep our balance and if anyone slips and touches the ground, we’re all fried.  We have to suck up the courage to address Social Security, Medicare, and Medicaid.  If we can’t slow the growth of these programs so that they take a smaller amount of the budget pie each year, we are toast.  None of those programs is in the Constitution, but the liberals/progressives created them with empty promises of benefits without costs.  This should have been the first clue:

“Ida May Fuller worked for three years under the Social Security program. The accumulated taxes on her salary during those three years was a total of $24.75. Her initial monthly check was $22.54. During her lifetime she collected a total of $22,888.92 in Social Security benefits.”

Ida May Fuller was the first recipient of monthly S.S. checks when she retired in 1940. She lived to be 100.

She almost got paid back in full with her first check. She got 926 times more than what she paid in. That’s a 92,600% return on “investment.” Not bad, huh?

She got back almost everything she paid in with her first check.  Instead of ringing alarm bells all over the country, politicians patted themselves on the back for the great system they created.  We sent Bernie Madoff to jail, why should Congress be exempt?  What Bernie Madoff did was child’s play in comparison.  Where he fell short was that he couldn’t force people to participate through payroll taxes, and he couldn’t print money.  So why is what he did criminal and what Congress is doing not?  He had to get his participants to voluntarily turn over their money.  He promised returns of 40% per year.  Ida may got 92,600% return on her investment.

Burn the Ships

There is the story of a general who landed on a beach to face an formidable enemy.  He ordered that the ships that brought them there be burned.  By doing so, he knew his men would fight ferociously because there was no escape, either they fought to win or they died.  Perhaps we should do the same with Congress and President Obama.  Fix Social Security and Medicare/Medicaid or you join Bernie Madoff in Cell Block “C”, for running a massive Ponzi scheme.  What has kept Congress from fixing this in the past is the fear of not getting reelected.  Let’s raise the stakes so that not getting reelected would pale in comparison to incarceration.  It’s time our elected officials started paying attention to the people and not their perks.  The disaster train is going downhill and picking up speed, headed for a cliff.  It’s time ALL politicians put the country first and fixed this problem that, after all, they created.  It’s fun to give out the goodies, but this is a crisis that cannot be shunned.  It must be dealt with head on.

For nearly eight years we heard the left scream, “Bush Lied!” over the decision to invade Iraq.  One decision and the same refrain repeated over and over again.  Where is the scrutiny of the truth police where President Obama is concerned?

In his State of the Union address he took the unprecedented step of calling out the Supreme Court and encouraging his minions to give that rebuke a standing ovation.  Shameful.  This is not to say that Obama cannot criticize other branches of government, but there is a time and a place.  When Joe Wilson called out “LIAR!” during a previous speech by President Obama he was roundly criticized and rightly so.  Not for the criticism, but for the time and the place.  Joe Wilson called the president to apologize.  Did Obama do the same?

The timing of the act was bad enough, but the accusation he made was not true, as Samuel Alito could be seen saying, if you can read lips.  In the midst of his constitutional duty to report to Congress on the State of the Union, he uses a blatant lie to attack his guests. But that wasn’t all.  His speech was sprinkled throughout with falsehoods, not least of which was his statement on jobs.

Counting the Uncountable

To try to put a positive spin on his porkulus bill, he had to make up a statistic that no reputable economist can endorse, “jobs saved”.  In his State of the Union speech and on the Sunday morning talk show circuit, Obama and his team talked about 2 million jobs created or saved. But they weren’t all on the same page, some said 1.8 million, but regardless it is blatant dishonesty.

Jobs created is a real statistic.  As a small business owner I can tell you that when you hire someone there are a number of government agencies that you have to report it to and you have a deadline in which to do so.  There is also some paperwork involved when you eliminate a job.  But I have never, never had to report to any agency when I thought about eliminating a job and then changed my mind.  After all wouldn’t that be the definition of a job saved?

If I never thought about eliminating the position, then the job is not “saved” it just continues to exist.  If I thought about eliminating the position and did so, it would not be a job “saved” it would be a job eliminated, no?  So it is this two step process of thinking about the action and then not following through that could reasonably be thought of as a “job saved”.  How do you measure that thought process?  Hiring someone is an observable action.  Eliminating a job is an observable action.  Saving a job are two related thought processes not externally observable, they can only be “reported” by the decision maker and it cannot be independently verified.  Is that the kind of statistic upon which you want your government to base billions of dollars in spending decision?   The only added feature of Obamanomics is that some money changes hands.  Money that comes from you, dear taxpayer, and goes to the businessman.  Can you see why such a statistic is ridiculous?

Which One Is It Mr. President?  Mr. Biden? Anyone?

Let’s pretend for a moment that “jobs saved” is a real statistic.  If the president has a figure in his head of 2 million jobs created or saved, and for the aforementioned reasons the number of jobs created is a hard number reported to some agency, then the number of jobs saved should be a matter of simple math.  2 million minus the number of jobs actually created equals the number of jobs saved.  So why not report it as such?  100,000 jobs created and 1.9 million jobs saved, for example.  Why lump them together?  Because when you lump them together its harder to tell how big of a lie the president is telling.

Stimulus recipients previously reported that they had directly “created or saved” 640,329 jobs by Sept. 30, but their filings were criticized after it emerged that some people had reported saving jobs when they had actually spent the money on pay raises or paying employees who were not in danger of being laid off.

In December, the White House Office of Management and Budget changed its guidance, telling recipients they should start counting every worker whose salary was funded with stimulus money, rather than guessing whether the jobs would have existed in the absence of the federal plan. Opponents of the program accused the administration of “moving the goal posts” to make the plan appear more successful. — Wall Street Journal, Latest Stimulus Report Fuels Jobs Pressure, Feb. 1 2010

So companies using stimulus money to give people raises was counted as jobs saved!  We have 10%-17% of our workforce idled and taxpayers are being fleeced to give people raises and this administration is calling that successful policy.  When do we start firing people in this administration?  How about Janet Napolitano?  How about Eric Holder?  or are we saving their jobs too so that the numbers look good?  The other reports are just as galling: $1000 purchase of a lawn mower is credited with saving jobs;  using stimulus money to purchase boots with each boot (left and right) being counted as a job saved because someone had to make the boots; stimulus money going to create jobs in Congressional districts that do not exist.  Does anyone have any confidence that this administration has a clue about how to run a government?  This is beyond embarrassing.

The Next Stimulus

But fear not, since the first stimulus was so successful, President Obama is teeing up the next one, but don’t worry this one is only $100 billion.  Doesn’t that just make you feel warm all over?

The Joke is on You

Joe Biden just held a press event to reveal how he was going to help the middle class.  The man who has a hard time reaching into his own pocket for more than $1 a day in charity to give to his fellow man, has no problem reaching into your pocket and give the fruit of your labor to someone else.  It’s a win-win.  It doesn’t cost Joe Biden and it helps him keep getting elected and drawing a salary that you pay for.

Here is what he revealed:

1. Nearly Doubling the Child and Dependent Care Tax Credit — in an economy that has over 10% unemployment this administration is focusing on helping those who already have a job and income.  I’m all for tax cuts, but not targeted cuts.  Cut income tax rates and jobs will be created.  I don’t believe this administration knows how to aim anything well enough to hit a target
2. Limiting a student’s federal loan payments to 10 percent of his/her income above a basic living allowance — the administration is concerned about how much debt students leave college with.  Does it have any concern about how much debt they are piling on everyone, not just college graduates?  Biden pointed to the average indebtedness of around $25,000 for college graduates.  The federal debt is about $35,000 for every man, woman and child in America, not just college graduates and this administration shows no signs of stopping it.
3. Creating a system of automatic workplace IRAs — government first got involved in retirement with Social Security.  That system is bankrupt and this administration has no interest in fixing it.  When Republicans floated the idea of taking a portion of the Social Security payroll tax and diverting it to higher return private savings, the Democrats savaged them.  So the Democrat solution is to ignore the bankrupt Social Security system and start telling business what to do.
4. Expanding tax credits to match retirement savings and enacting new safeguards to protect retirement savings — again with Social Security bankrupt, they want to put more tax dollars into retirement.  How different is this than the Republican plan to take what exists and allow it to get better returns than the paltry rate it currently gets within the Social Security system? The difference is that the Republican plan wouldn’t cost anything extra.  The Democrat plan will either increase payroll taxes or increase the deficit.  Surprise!!!
5. Expanding support for families balancing work with caring for elderly relatives –I thought the Democrats had fixed this with “end of life counseling” in their health care plan, coupled with bringing back the Death Tax next year.

Fumbling and Stumbling

The way to create jobs is to let the job creators keep their money to invest in their business and expand.  Small business owners are stuck waiting to learn how much all of Obama’s social re-engineering is going to cost them and until they know that, hiring is the last thing they will do.  The only thing this administration seems to know how to do is bash business and spend money and the more they spend the longer the recover will take.  They are now planning another stimulus plan to follow the last stimulus plan that didn’t work, and the deficit continues to grow and grow and grow.

President Obama wants to create a bipartisan panel to recommend how to reduce the deficit.  He gives the back of his hand to bipartisanship when it comes to workable solutions to real problems, but he loves bipartisanship when it gives him political cover to make unpopular decisions.  All of his supporters love to say that experience doesn’t matter and that President Obama is the smartest guy in the room.  If that is true, he should not be afraid to propose bold spending cuts and shrinking government and be smart enough to explain it to Congress on his own.  If he does so, I am sure many Republicans would support him and vote for it (and almost all Democrats vote against it).  But he wants it both ways, he wants Republicans to yield to tie spending cuts to tax increases and put the package to an up or down vote.  He will then take that on the campaign trail to tell the world how Republicans voted for tax increases.  If you don’t believe me, look to history.  George Herbert Walker Bush, of the “no new taxes” pledge, got Congress to agree with spending cuts in return for a tax increase.  Bill Clinton clubbed him to death, like a baby seal, with that pledge and then enjoyed Bush’s restraint upon Congress on the spending side to generate budget surpluses.  Let President Obama take the lead.  Wasn’t that why he was elected?  Because he was a different kind of leader?  So, lead away.