President Obama spent last week gloating about a spending freeze that will (supposedly) generate $250 billion in savings over 10 years, but no more than 10 billion for the 2011 budget. Some think that he was sincere in that undertaking, yet given his announcement this week proposing a fiscal 2011 budget deficit of $1.3 trillion, it is very difficult to believe there is a shred of economic literacy within the Obama administration.
Take a look at this post from BusinessInsider.com:
Now, what do you think? Is Obama crazy? I doubt it. Does he have the foggiest clue about economics? Clearly not. How can the POTUS propose something so irresponsible? I suppose it could be because no one on Obama’s team has a clue about economics either, so we have the economically blind leading each other around inside the White House. See the chart below for details.
- Obama Cabinet Members with Private Sector Experience
If it is not economic ignorance, what is it? The Cloward-Piven strategy? I don’t know, but if Obama continues to pursue such absurd economic policies, he will lead the US to economic ruin. Whether that is his intent or not will be for historians to figure out.
This chart illustrates the decline in personal responsibility for healthcare costs over the last 50 years. Now I have to find the best source for healthcare cost increases over the same time period, but I would guess the correlation between these two factors will be quite high. It’s what always happens when people can use “OPM” – other people’s money – to purchase anything for themselves. Note: This chart was created by Dan Mitchell, using data obtained from the Centers for Medicare and Medicaid Services’ national health expenditures data website and originally posted at Andrew Breitbart’s BigGovernment.com.
From yesterday’s WSJ Opinions, Lawrence Kadish discusses the utter folly of creating more government obligations.
It is the interest on the national debt that makes our future unstable. The exploding size of that burden suggests that, short of devaluing the dollar and taking a large bite out of the middle class through inflation and taxation, there is no way to ever pay down that bill.
As of Sept. 30, 2009, the national debt was almost $12 trillion and interest on that debt was $383 billion for the year, according to the Treasury Department’s Bureau of the Public Debt. The Congressional Budget Office on Oct. 7 estimated the 2009 budget deficit to be almost $1.4 trillion (about 10% of GDP). In August, the White House Office of Management and Budget (OMB) estimated total government revenues at about $2 trillion. The revenue estimate included $904 billion from individual income taxes. This means the cost of interest on the debt represented more than 40 cents of every dollar that came in from individual income taxes…
In stark but simple terms, unless Americans are made aware of this financial crisis and demand accountability, the very fabric of our society will be destroyed. Interest rates and interest costs will soar and government revenues will be devoured by interest on the national debt. Eventually, most of what we spend on Social Security, Medicare, education, national defense and much more may have to come from new borrowing, if such funding can be obtained. Left unchecked, this destructive deficit-debt cycle will leave the White House and Congress with either having to default on the national debt or instruct the Treasury to run the printing presses into a policy of hyperinflation.
It is against this background that Washington is now debating whether to create social programs it can’t afford…
Americans need to take notice, stand up, and remind our elected officials that in a democracy the people can change bad leaders.
Dave Burstein at DSL Prime reports that Ivan Seidenberg effectively says the the wireline voice telecom business is dying:
“we have to pivot and make a shift from the voice business to the data business and eventually to the video business. … we must really position ourselves to be an extremely potent video-centric asset.” He further states, “The issue there is perhaps it is like the dog chasing the bus a little bit. So what I need to do is get ourselves focused around the following idea, that video is going to be the core product in the fixed line business. … I shed myself of the burden of chasing the inflection point in access lines and say I don’t care about that anymore.”
Despite Seidenberg having been one of the few telecom industry visionaries to truly embrace data/video as the future of the industry as long as 10 years ago, it still sounds strange (heretical, in fact) to hear a telecom CEO say “I don’t care about that [access lines] anymore.” On the other hand, I believe Seidenberg is correct in focusing Verizon’s strategy on the combined communications capabilities of its wired and wireless footprints. (more…)
Newt Gingrich observes the pressure on Chinese leadership to create jobs while discussing his recent trip to China.
The economic pressure the Chinese dictatorship feels to continue creating jobs can be captured by the fact that they need 24 million new jobs this next year just to break even.
Their fear is that without jobs unrest will grow and that historically in China unrest can rapidly become very destabilizing. This focuses their energy on jobs and the economy in a way no American politician can fully appreciate.
So, the Chinese leadership feels intense pressure to create 24 million jobs every single year! Meanwhile, back in Obama’s USSR, unemployment reached 14.9 million (August – US Bureau of Labor Statistics) and Obama & Co. appear perfectly content to simply manage expectations for this level of unemployment to persist for years, as indicated last week by Obama’s chief economic advisor, Larry Summers.
More on this later…
In his latest WSJ opinion piece, John Fund documents the damage done to ACORN by the outstanding work of James O’Keefe, Hannah Giles, Andrew Breitbart and Glenn Beck, as well as other less sensational but equally corrupt charges brought against the organization across the country. In all likelihood, we have only seen the tip of this iceberg.
Newbusters reports that Charlie Gibson declares no knowledge of the ACORN scandal ignited by the investigative reporting and filmmaking of James Okeefe and Hannah Giles. And this guy is the lead reporter/newscaster for a “major” network? Duh! No wonder the “major” networks are either not ranked or at the bottom of the TV news audience rankings.