In the midst of the financial meltdown the government and financial pundits argued that they had to rescue the big banks because they were too big to fail.  If we don’t save them, they could bring down the entire U.S. economy and in  turn the economy of the entire world.  Ignoring the history and responsiblity for how they got there, that could be a true statement that the government had to do something to avoid a worldwide panic.

The panic averted, many banks paid the money back with interest, are in the process of paying out massive bonuses and the Obama administration is twisting itself in self-righteous knots to tax them into humility.  Good luck with that.  While they target the banks, they are hands off on Freddie Mac and Fannie Mae, GM and Chrysler because to tax those basket cases would just be taking money from the left taxpayer pocket and moving it to the right taxpayer pocket.  If you look to the root of the problems of the fiscal meltdown you will find the government’s hand in almost every corner, but don’t expect this administration to try to get to the bottom of it.

Back Up, Go Ahead

There was an old Abbot and Costello routine where Abbot was guiding Costello in parking a car.

Costello asked what he should do and Abbot said, “Back up.”

Costello confirmed, “Back Up?”

To which Abbot replied, “Yeah, go ahead.”

“Go ahead?”

“No. back up.”

“Back up?”

“Yeah, go ahead.”

I don’t know if the Obama administration is Abbot or Costello, but they are telling banks, “Lend more money.”  Then they tell the banks, we are going to raise taxes and take your money away.  Then they ask the bank, “Why aren’t you lending more money?”

Programs You Can Believe In

Medicare

It is estimated that Medicare loses about $60 Billion ANNUALLY in fraud.  That’s right about $60 billion of your tax dollars are stolen every year from this program.

“If you want to find Medicare fraud, the first place you should look is South Florida, where 60 Minutes and correspondent Steve Kroft were told it has pushed aside cocaine as the major criminal enterprise.” – 60 Minutes – Medicare Fraud: A $60 Billion Crime

While the Obama Administration pushes their health care program one of the ways of funding the program is through savings in Medicare fraud.  However, no one has been able to stop it.  Not Republicans.  Not Democrats.

First Time Home Buyer Credit

This wonderful new program was designed to help first time home buyers achieve the American Dream.  Unfortunately, it doesn’t take a genius to also achieve that criminal American Dream, fleecing the government.

It’s hard not to laugh when viewing the results of the federal first-time home-buyer tax credit. The credit, worth up to $8,000 for the purchase of a home, has only been available since April of last year. Yet news of the latest taxpayer-funded mortgage scam has traveled fast. The Treasury’s inspector general for tax administration, J. Russell George, recently told Congress that at least 19,000 filers hadn’t purchased a home when they claimed the credit. For another 74,000 filers, claiming a total of $500 million in credits, evidence suggests that they weren’t first-time buyers. – WSJ – First Time Fraudsters, 10/29/2009

The  IRS even had to admit that in an investigation they found 53 cases where IRS employees filed “illegal or inappropriate” claims for the credit.

Too Big To Govern

A new president is elected once every four years, but the vast government bureaucracy remains.  It is said that a president will only be able to address 3-4 top priorities in their term.  By the time they appoint executive department heads and the Senate approves them and they set about to figure out the departments they are in charge of, it is an enormous undertaking to try to make significant changes.  To try to curb fraud, to overcome the inertia of the entrenched bureaucrats who know they will outlast the appointee, and their friends in Congress who will probably be there as long, is just too tall an order to accomplish in a four year cycle.  Every time a new liberal takes over, their first order of business is to make the bureaucracy larger.  It does not work.  It will not work.

The Only Solution

The only solution is to make the federal government smaller.  It must be bold.  It must be dramatic.  Tweaking it at the margins will fail.  Entire departments must be shut down.  The Constitution should be the blueprint for this.  If the power is not explicit in the Constitution, shut it down and allow the states or local governments to take it up if they choose.  Then drastically cut taxes accordingly.  Let people keep their money and decide at the local level if they want that service or not.  Let every state try their own solution and each state can learn what works and what doesn’t from each other.  But this idea of pushing every solution up to the federal and let one size fits all be forced on everyone is, quite simply, madness.  We need less government and more liberty.

We have had several bubbles before, but if the Obama administration has their way, “you ain’t seen nothin’ yet.”  Currently the budget for the federal government is $4 trillion dollars.  That’s right, your federal government will spend approximately (which means probably more) $4 trillion in one year.  Of that amount $202 billion is interest on the national debt.  In an article in the New York Times today by 2019, a mere ten years from now, the portion of the budget directed to interest payments will be over $700 billion, or three and a half times what it is today.  Many people have trouble grasping how much a trillion dollars are, and within ten years we will be paying three-quarters of a trillion dollars just to cover the interest without paying off any of the principle.

Family Budget Analogy

We all understand the dramatic effects of too much debt, as the point has been driven home every day throughout this financial crisis.  Bankruptcy filings, home foreclosures, bailouts, all resulting from more debt than we can pay the interest on, let alone pay back the principle.  You see commercials on television every day for companies that will help you renegotiate your credit card debt, your mortgage, intervene on your behalf with the IRS.  None of those programs are available to the federal government as a debtor. 

Obama’s Out of Control Spending

The Obama administration seems oblivious to the problem.  As bad as it is they just keep on spending or want to spend more:

• Stimulus package — $787 billion.  Despite evidence that it is not working and widespread opposition from the American people, the Obama administration is simply declaring that it is working and we need to do it again with a second stimulus
• Cap and Trade — this is a program that will drive energy costs through the roof for no real benefit.  After all if, as is becoming more and more apparent, global warming is not man made then it cannot be stopped by man either.  Higher costs will lead to businesses closing down, laying off people, and generating less tax revenue from both the businesses and the individuals it laid off.  Result — an increase in the deficit.
• Health Care — another $1 trillion of IOUs piled on our children’s back and if Medicare’s history is any guide, these numbers are well below what will really happen.

The Truth About Government

The truth is that government doesn’t create anything.  They don’t generate income.  Everything that government has to spend comes from you and me.  The government takes it from us (or throws us in jail for tax evasion) and then spends it.  If they can’t get enough from us, they borrow the difference.  But somewhere down the line, that money has to get paid back.  A news report today said we have the opportunity to just write a check to the Treasury if we are concerned about the deficit and want to help pay it down!  Let’s see how many of Obama’s wealthy supporters sign up for that program.

Runaway Train

Our federal government is a runaway train and if we don’t stop it very soon and pare it back to the functions enumerated in the Constitution, we will get hit with a bubble so big, that there is no Hollywood screenwriter that could even begin to conceive of how to portray it.  $700 billion folks, that’s $2,059 in INTEREST for every man, woman and child in America.  Ask yourself this, if you are a family of four are you prepared to write a check for $8,235 to the federal government for interest alone?  You don’t get anything for your money, it just keeps your government from defaulting on what they already borrowed. This will be on top of your regular tax bill. And the next year you will have to pay it again and probably more.  It’s time to stop the madness.  It’s time to stop the spending.  It’s time to stop the expansion of government and start shutting down departments.  It’s what you would do at home in a financial crisis, it’s what a small business would do in a crisis.  This is a crisis that we can still get under control, but if the debt continues to grow to the point where we can no longer afford to pay even the interest, America will be a footnote in history.

Do I have your attention now?

I’ll bet you thought I would be writing about Roland Burris, the senator appointed by Governor Rod Blagojevich under dubious circumstances.  No, Senator Mary Landreau of Louisana just sold her vote on the senate health care bill to Harry Reid for $100 million.

Here is what was reported by ABC News.

On page 432 of the Reid bill, there is a section increasing federal Medicaid subsidies for “certain states recovering from a major disaster.”

The section spends two pages defining which “states” would qualify, saying, among other things, that it would be states that “during the preceding 7 fiscal years” have been declared a “major disaster area.”

I am told the section applies to exactly one state:  Louisiana, the home of moderate Democrat Mary Landrieu, who has been playing hard to get on the health care bill.

In other words, the bill spends two pages describing would could be written with a single world:  Louisiana.  (This may also help explain why the bill is long.)

Senator Harry Reid, who drafted the bill, cannot pass it without the support of Louisiana’s Mary Landrieu.

How much does it cost?  According to the Congressional Budget Office: $100 million.

But don’t worry, the talking heads in the lame stream media will soon be circling the wagons saying that Senator Landreau didn’t personnally get any money, she got it for her state.  But where did the money come from?  Your pocket, my pocket, and your children’s and your grandchildren’s pocket.  In short, Harry Reid is using the coersive power of the IRS to take your property and give it to Louisiana so that a deeply flawed health care bill will get passed and Mary Landreau can get re-elected.  Seems fair to me.  Does it seem fair to you?  Isn’t that what makes you proud to be an American?  The arrogance of this Congress and administration are incomoprehensible.  They see Tea Parties across the country rising up to protest their out of control spending.  They get blasted when then go home for their summer recess.  Poll after poll says the country is opposed to the stimulus package, cap and trade, the health care bills, but they just keep rolling on.

Let me quote from the Declaration of Independence:

“We hold these truths to be self-evident, that all Men are created equal, that they are endowed by thier Creator with certain unalienable Rights, that among these are Life, Liberty, and the Pursuit of Happiness — That to secure these Rights, Governments are instituted among Men, deriving their just Powers from the Consent of the Governed, that whenever any Form of Government becomes destructive of these Ends, it is the Right of the People to alter or abolish it, and to institute new Government, laying its Foundation on such Principles, and organizing its Powers in such Form, as to them shall seem most likely to effect their Safety and Happiness.”

“But when a long Train of Abuses and Usurpations, pursuing invariabley the same Object, evinces a Design to reduce them under absolute Despotism, it is their Right, it is thier Duty, to throw off such Government, and to provide new Guards for their Future Security.”

These are troubling times.  We cannot allow these abuses to continue without speaking out loudly and strongly.  Our government has gotten far too big and out of control.  It’s time to shrink it back to where the Founding Fathers envisioned it: limited and unobtrusive.

Just when you thought this administration had gone about as far as it could go in turning America into the old Soviet Union another subtle clue is revealed.  When you craft legislation that is over a thousand pages long and you try to slam it through before anyone can read it, all kinds of creepy things come crawling out when you turn the lights on.  This is from the White House’s blog:

“There is a lot of disinformation about health insurance reform out there, spanning from control of personal finances to end of life care.  These rumors often travel just below the surface via chain emails or through casual conversation.  Since we can’t keep track of all of them here at the White House, we’re asking for your help. If you get an email or see something on the web about health insurance reform that seems fishy, send it to flag@whitehouse.gov.”

Turn in your neighbor?  Does this not sound like Cuban block watchers in Castro’s worker’s paradise?  Is your name in their database?  If you apply for a government job, do you think you might run into a “problem”?  Will the IRS come knocking on your door to audit you?  If this doesn’t send chills up your spine, you are made of sterner stuff than me.

What’s really Fishy?

To be fair, everything this administration has said about health care, or is it health insurance, seems fishy?  So should all Americans be writing to the White House to complain?  Be careful, I am sure they are taking the names on both sides of the e-mail.  This Administration wants the First Amendment only to apply to the titan of the teleprompter.  But if you criticize the state, you are Astroturf, an unruly mob, crazed right-wing plants.  When do they send the goons in to break up the crowd and beat a few participants to send them a lesson.

Be Careful Before You Take a Bite Out of that Apple

The administration is touting the Cash for Clunkers program as a great success.  But as the auto dealers file for the rebates they are faced with this {emphasis added}:

“This application provides access to the DoT CARS system. When logged on to the CARS system, your computer is considered a Federal computer system and is the property of the U.S. Government. Any or all uses of this system and all files on this system may be intercepted, monitored, recorded, copied, audited, inspected, and disclosed to authorized CARS, Dot, and law enforcement personnel, as well as authorized officials of other agencies, both domestic and foreign.”

This was widely reported by Glenn Beck and immediately the statists came forth to attack him as a right wing fanatic.  I also saw some insipid posts saying, “well how are they going to be able to do that?  I’ll smack anyone who tries to touch my laptop; that web site is only for the dealers, not for consumers, etc., etc.”  To that I say, read it for yourself and decide.  Perhaps, as some suggest, it was some overly aggressive government lawyer who was trying to protect…  Protect what?  Rebates?

The pattern is shocking and the pattern is clear.  If the government gives you TARP money, the government sets your salary.  If the government bails out and then takes over the car companies, the government will decide what kind of cars it will build and if it loses money for years (Amtrack, the Postal Service), the government can decide to keep them afloat to achieve their agenda.  Keeping all those UAW members on the government teat, will keep their votes in the Democratic column.  Now if you want a rebate, the government owns your computer.  Let’s see, is there any disparaging information about the Obama administration on there?  No rebates for your dealership and we’ll fire off an e-mail to flag@whitehouse.gov to boot.  And what about that reference to foreign agencies?

Barack Obama is a disciple of Saul Alinsky and he knows a thing or two organizing and defeating his opponents, not by logic or reason, but by attack and disinformation.  That is how dictators grab power.  Will we be able to do as our Founding Fathers did and stop the spread of this tyranny?  The recent town hall meetings with our legislators give me reason to hope that Americans are paying close attention and do not like what they see.

The powers not delegated to the United States by the Constitution, nor prohibited by it to the States, are reserved to the States respectively, or to the people — Amendment X, United States Constitution

“I’m Mad as Hell and I’m Not Going To Take It Any More”

That quote from the movie “Network” popped into my head as I read about a legislator in Oklahoma, calling for legislative support for the 10th Amendment to the Constitution.  It passed the state assembly unanimously.  So what does this mean?  The sponsor of the bill, State Senator Randy Brogdan, explains:

The “federal government has been putting the screws on (the states) a little tighter and tighter each year” along with unfunded mandates of varying sorts.

And each time this happens, Brogdon explained, “We lose a little bit of our freedom and liberty.”

The federal government has been growing enormously and taking on more and more things that used to be handled locally, such as education, and welfare.  Other programs have not changed as the economy has, for example, as the percentage of the population that farms has decreased dramatically has the Department of Agriculture shrunk accordingly?

You Must Obey!

The way the federal government works around this is by saying, okay, you don’t have to do what we tell you, but you will get no federal funding if you don’t.  It seems like a Catch-22, no?  Since the 16th Amendment, which authorized the income tax, the federal government can decide how much to tax incomes and there is little that the states can do about it.  They take money from your pocket under threat of imprisonment, and will give it back to you only if you comply with their rules.

How Do We Fix This One?

It may require a constitutional amendment to fix as the 16th Amendment says:

The Congress shall have the power to lay and collect taxes on incomes, from whatever source derived, without apportionment among the several States, and without regard to any census or enumeration. — 16th Amendment to the Constitution

I’ll leave the legal mechanics to those better qualified, but I would propose the following.  That the federal budget shall include a breakdown of projected revenues derived from income taxes, broken down by source: individual, corporate, etc.  A state should then be allowed to refuse mandates and programs from, say, the Department of Education, and withhold from the IRS that proportion of tax dollars destined for the Department of Education from that state.

Certain departments should be deemed mandatory, such as Defense, State, Treasure, to name a few as these departments serve all citizens.

The legislation under consideration in Oklahoma will have little effect if the federal government can suck up as much money as it wants to from the states, via their citizens and then just keep the money if the states refuse to participate in the programs.  How do you determine which programs should be subject to the states discretion?  No money should flow from a state, to Washington, and then back to the state.  That is just plain stupid and wasteful, or a distribution of wealth, none of which is a government function. Paying for roads and infrastructure that does not cross state lines should be funded locally.  It is ridiculous that the federal government pays 90% of the cost of a highway that lies entirely within a city.  Look at the scandalous “Big Dig” in Boston.  Billions of dollars spent and parts of it are falling down.  Why should any of this be paid for by the people of Kansas, Oklahoma, Alaska, New York, Florida, et al.?

But the real answer is following the 10th Amendment.  It clearly states that the role of the federal government is spelled out in the Constitution.  If it’s not in the Constitution then that responsibility is left to the states or the people.  Show me where in the Constitution it says that the federal government is responsible for education.  It’s not in there and that department should be shut down tomorrow.

It’s Time to Reign the Monster In

The anger in the country is growing.  Those who acted responsibly are being told they have to bail out the irresponsible.  They are being told by “Buck a Day Biden” that it is their patriotic duty to pay higher taxes to help out.  Meanwhile half a dozen Obama appointees haven’t paid the taxes they owe, let alone paying more.  I give Biden the “Buck a Day Biden” moniker because that is how much this millionaire give to charity.  He doesn’t want to spend his own money on charity, he wants the government to take your money to fund government programs to do that.

If you don’t think the anger is growing take a look at this.  Rick Santelli

President Barack Obama

“Can’t Anybody Here Play This Game,” is what Casey Stengel reportedly said while watching his team, the New York Mets.  The same could be said of the Democrats when it comes to paying taxes.  The Democrats are the ones who rail against tax cuts for the rich.  They don’t believe in lower tax rates to stimulate the economy, but if these wealthy Democrats find taxes problematic, they just don’t pay them.

We now hear of another nominee, Tom Daschle, former Senate Majority Leader, has a $140,000 tax problem. $140,000! Most Americans would like to make that in income, let alone owe that in taxes.  This follows on the heels of Treasury Secretary Timothy Geitner paying back taxes of $34,000 and Charlie Rangel, Chairman of the House Ways and Means Committee that writes the tax laws, paying $10,800 in back taxes.  We’d probably have a balanced budget if all these rich Democrats only paid the taxes they owe rather than fighting against tax cuts for everyone.

Here’s Daschle’s excuse for his tax problem:

“Mr. Daschle told committee staff that he had grown used to having a car and driver as Senate majority leader and didn’t think to report the perquisite on his taxes, according to staff members.”

Two things come glaringly into view here.  First is the overall arrogance that these “public servants” feel they deserve privalege.  They have no concept that in the real world not everyone has a car and driver provided by their employer. In this case the employer is all the Joe Sixpacks out there.  The second thing is that these problems were discovered and fixed, in the cases of Daschle and Geithner, only after they were nominated for positions in Obama’s cabinet.  So, what if they weren’t nominated?  Do you think that this tax revenue that is legally owed to the government (you and me) would still be in their pockets?

We have the chairman of the committee that writes the tax laws failing to pay his taxes.  We have the Treasury Secretary who oversees the Internal Revenue Service failing to pay his taxes.  We have the former Senate Majority Leader who ran the senate that passes all laws failing to pay his taxes.  Do you think it’s too hard to figure out how to comply with our tax code?

It’s time to scrap the tax code and go to a simple flat tax that you can file your return on a post card.  Let’t put the $200 billion that Americans spend each year on tax compliance back into the economy.  Let’s make sure that all these rich Democrats pay the taxes they owe.  Do these two things and we probably won’t need a stimulus package.

It couldn’t be more clear that the Obama adminstration should immediately begin the conversion from our convoluted tax code, to a flat tax that could be filed on a post card.  How can I make such a claim?

Well, Charlie Rangel, Chairman of the House Ways and Means Committee, the committee that writes the tax laws, seems to have forgotton to pay his income taxes on a villa that he owns in the Dominican Republic.  More recently we learn that Timothy Geithner, Obama’s nominee to be Treasury Secretary, didn’t pay Social Security and Medicare taxes for several years.  The Treasury Department includes the Internal Revenue Service which enforces the tax laws that Mr. Rangel’s Committee writes and collects the money.

So if the tax laws are so complicated that the individual in charge of writing the tax laws cannot understand them enough to follow them, and they are so complicated that the individual in charge of enforcing those tax laws, doesn’t understand what he is charged with enforcing, don’t you think it’s time we simplified the tax laws?  If these highly educated, very experienced, extremely intelligent people cannot comply with the tax code, what hope does the average Joe have?  Perhaps that is why it is estimated we spend $200 billion per year in tax compliance.  Couldn’t that money be more productively be employed elsewhere in the economy?

What do you think?

Watching the third and final Presidential debate I can best sum it up by saying A pox on both your houses! In the midst of a very precarious financial situation both candidates talked about how they were going to get more deeply enmeshed in all of our lives.  The tenth amendment of the constitution states:

“The powers not delegated to the United States by the Constitution, nor prohibited by it to the States, are reserved to the States respectively, or to the people.”

In other words if it’s not spelled out in the constitution, it is not a federal function.  Seems like a pretty good idea, no?  Keep government as close to the people as possible.  What we are witnessing is a massive gathering of all government at the federal level.  Where in the Constitution does it say that education, health care, teacher’s salaries, and pension plans are the responsibility of the Unites States?

In 2006, the IRS took in $1.3 trillion in taxes from individuals and last night the candidates said that government wasn’t big enough!  We need to add more programs. We need to take more tax revenue (but only from the rich).  Both candidates will balance the budget.

What we need to do is print out the tenth amendment, laminate it, and require every politician carry it in his or her wallet and then read it aloud before voting on any bill or law.  The way out of this mess is to put together a plan to disassemble the New Deal, The Great Society, No Child Left Behind, cut taxes massively, and let the States, the counties, the cities, the towns and the villages address the issues that lie within their borders and be accountable to the citizens that live therein.

Liberty is not about more government to run every aspect of our lives.  It is about the minimal amount of government that is necessary so that we can have the right to live our own lives as we see fit.