Tag Archives: debt ceiling

THERE IS A GOOD REASON WHY THE DEBT CEILING FIGHT WAS SO FIERCE

It was a bitter fight.  Thank God for the fight!  For without it the Democrats would have ratcheted the national debt even higher.

The reason the nation’s credit rating was reduced is because the federal government overspends and is deeply, very deeply,  in debt.  In defiance of all reason, the Democrats fought hard to increase spending and increase the level of debt.  Rick Santelli got it right when he said if it had not been for the Tea Party the nation’s credit rating would be BBB.  Thank God for the Tea Party!

Santelli may have been engaging in a bit of hyperbole, but then he may not.  What rating would you give to a family with an 80,000 annual income that is 501,000 dollars in debt?  Would you trust them more if they promised to cut a little spending, perhaps to 124,000  sometime in the near future,  but only if you agree to increase their line of credit immediately so they can spend more now?

The numbers in the table below are real. They were not pulled out of a hat.   See this prior post for an explanation of the family equivalent table.  Click on the table to enlarge it.


As long as Democrats control the Senate and the presidency the choice will be bitter word fights in Washington or deadly riots elsewhere as the money for “entitlements” runs out.  Thank God for the word fights.

P.S.
We are back.  The vacation was great.  Look for new posts.

THE DEBT AND DESTINY OF THE UNITED STATES

Why the Debt Ceiling Fight Is So Fierce

Really now, how serious is this national debt problem?.  Figures fly at us like a fleet of locusts.  The onslaught of numbers comes from all directions, talk radio, think tanks, politicians and from agencies of the government itself.  The size alone makes it impossible to relate.

We have been told how many freight cars it would take to hold a trillion one dollar bills and how many times a trillion dollars worth of sawbucks would go around the world laid end to end.  But that doesn’t tell us anything useful; it just shows the numbers are big.  We knew that.  Then we read about percentages of GDP.  What does that mean?  How can we relate?  How can we make sense of it?  We do it by relating expenses and debt to income, not to freight cars or GDP.  Our table relates the financial state of the nation to basic family finances.

The government numbers in the table are fixed.  Except for Unfunded Liabilities which is an estimate; the figures are reported facts.  The family side is a “what-if” table.  It answers the question — if a family had an income of 80,000 dollars with spending and debt in the same ratio to family income as the government ratios, where would the family be?

The answer is nearly unimaginable.  Such a family would have a half million dollars in outstanding debt, over 600,000 dollars in additional future commitments, no savings and still spending nearly 60% more than they earn.  Is it any wonder the rating agencies are prepping us for a downgrade?  Is it any wonder why there is a stalemate in Congress when some members, with the backing of the president, actually want to increase federal spending and debt while others insist on cutting both before it’s too late?

If your income is half the 80,000, cut the rest of the numbers on the family side in half.  If your income is double, double them.  If you have a blog please feel free to take the table and use it as you wish.  The more distribution it gets, the better.

Click the table to enlarge it.

A CALL TO OPEN GOVERNMENT

Jeff Sessions

Image via Wikipedia

In this debt debate, do you really know who has offered what?  Did Obama agree on some things, and then raise the bar when they were accepted as some Republicans have said?  Or did he not?  Name three key points and the numbers involved on which the two sides disagree.  Okay, then name one, with the numbers, of course.

I have warned from the beginning that if we skirted legislative process in favor of closed-door White House meetings, we would find ourselves in the 11th hour with gimmick-filled legislation being rushed through to a panic-driven vote. … We should try the one thing that has been refused from the beginning: open hearings, regular order, and real legislative process.     Sen. Jeff Sessions (R AL).

But then, let’s follow the law–that is, the Congressional Budget Act, which the Democrats have wantonly ignored. Let’s have committee hearings and craft legislation in the light of day; let’s debate the resulting bills on the floors of the House and Senate; let’s propose and debate amendments; let’s allow the American people and third-party experts to see and to evaluate the tax and spending proposals that our representatives want to enact.  That’s the way the federal government is supposed to conduct its fiscal business.  Let’s get back to it.      John Hinderaker (Power Line blog)

Obfuscation is a tactic.  It hides the truth.  The majority of the public wants to see spending reduced.  The truth is Obama wants to see federal spending increased.  The truth hurts his cause.  But closed doors cannot block discernment.  The President is digging himself into a hole on this one.

CANTOR vs. OBAMA, WHO DISSED WHOM ?

Rep. Eric Cantor (R VA) asked and was granted permission to speak at the Debt Ceiling debate organized (there’s that word again) by Barack Obama.  The Congressman spoke respectfully at all times and never interrupted the President.  But when Cantor said that the two sides remain so far apart at this point that he doubted they could get the $2.5 trillion in cuts (the latest debt increase requested by the administration) by August 2nd, the President lost his cool.

“Ronald Reagan wouldn’t sit here like this”.  “Eric, don’t call my bluff.  I’m going to the American people with this.”  Then Obama pushed back his chair and walked out.  If you grew up with siblings you will recognize this as the old “I’m tellin’ !” threat.

That’s one side of the story.  Here’s the other.  Cantor was harassing the President and interrupted him when he tried to speak.  Nancy Pelosi said “The president could not have been more gracious.  I have never seen a president spend so much time with the leadership of Congress day in and day out, respectful of their concerns.”  Cantor was acting like a cry baby because he was not getting his way.

Let’s be fair.  We don’t know what happened in that room; we weren’t there.  One thing we do know is that one hope for change was Obama promise to bring unprecedented transparency to government.  That promise was a significant factor in gaining favor with swing voters in 2008.  What we got was unprecedented concealment.

Previous presidents routinely allowed reporters to attend debates like this.  But, much to the consternation of both sides of the press, they were not allowed in the room, not even a lone reporter.  Why?  Is Obama afraid of truthful reporting?  What did he anticipate that he did not want the public to know?  Nothing in particular; stealth is just his style.