Sunday, July 31, 2011

Obama, Congress Reach a Debt Deal

Debt Ceiling Crisis: This deal sucks!

They did it! Whoopee!

It looks like the Democrats and Republicans have agreed to a deal on raising the debt ceiling. How did they do it? It was very simple. The Democrats agreed to almost everything the Republicans wanted.

The deal cuts 1 trillion dollars over ten years and forms a bi-partisan committee to discuss how future cuts are to be made. If the committee comes to an impasse then pre-decided cuts will take place which will effect entitlement programs and the military, something each party will not want. This will drive them into a negotiated deal. The Republicans do not want cuts to the military and the Dems do not want cuts to entitlement programs.

What the deal doesn't have is any increases in revenue. No tax increases to those who caused this economic mess. No cuts to subsidies for oil companies or ethanol producers. No plugging of the loopholes that enables companies like General Electric to pay zero taxes while making record profits.

The little guy gets screwed while the wealthy carry on. They need to contribute to the country also!

Saturday, July 30, 2011

Democrats: Republicans refusing to negotiate on debt crisis

Republicans want this debt crisis!

After not posting for two weeks I can see we are no further along in solving this manufactured debt crisis then when I last wrote about this. Now we are getting down to the wire. The question is, "Will we have a deal before midnight on the last day?" Probably!

In the past the debt ceiling was approved by the House as a routine procedure with both Democrats and Republicans participating in the process. The present situation has been solely created by the Republicans in order to draw attention to the issue of reducing the debt, an issue they would like to run on in 2012. Why this issue? Because they are trying to go back to what they once were known for, fiscal responsibility.

The truth is that since 1980 (31 years) they have had the presidency for 20 years and they have never balanced the budget or created a surplus. They increased spending without raising the correct amount of revenue to pay for it. During this time after 8 years of the Democratic presidency under Bill Clinton the Democrats were able to balance the budget and create a surplus but then we had 8 more years of George Bush who accelerated spending at an exorbitant rate. He allowed financial institutes to play risky games with their customers money resulting in the biggest recession since the 1929 Great Depression. All of this has been placed in the arms of a new president, Barrack Obama.

Now the Republicans are trying to redeem themselves, counting on the short memories of the electorate. They are trying to show voters how they are willing to stand on their new found principal of reducing the deficit while insisting on tax cuts for themselves and their rich friends. If these tax cuts come to fruition they will be felt by the middle class and poor. This is a risky game of brinkmanship they are playing that may well backfire in the polls during the 2012 election, not to mention sending the already fragile economy into another tailspin.

One thing that is certain, is that Tuesday will tell all what our future outcome will be!

Thursday, July 14, 2011

Debt Crisis - Cantor's Crisis - Republicans Back Down .

While President Obama is asking for a 4 trillion dollar cut in the federal debt, the Republicans are backing away from their main platform of reducing the federal debt and balancing the budget. The four trillion dollar reduction included cuts to entitlements such as Medicare, Medicaid and Social Security. In addition to this they also wanted to cut over 700 billion to the Military. The only item President Obama was asking from the Republicans was some closing of corporate tax loopholes. In particular subsidies to Oil Companies that are enjoying billions of dollars of profit. They were asking for no tax increases.

Republicans are showing how little they care about reducing the debt by backing away from this offer. What really scares them are the closing of the corporate loopholes. This would put them in direct opposition to their main campaign funders and friends in the corporate world. The Republicans are really only about cutting taxes whether that results in increasing the debt or not. Most of what they propose for tax cuts are only for the rich. The irony is that many of the rich are not even asking for it.

The most inflexible of all the Republicans is Eric Cantor. The amateur style of his negotiating reveals his self-serving  opportunist character that looks to lap up the lime-lite without any consideration to the rest of the American public.

Saturday, July 9, 2011

Big Government Can Do Big Things - What makes a strong country?

We hear a lot of rhetoric these days about shrinking big government and "getting government out of the lives of the people". Do we even know what we are agreeing to when we say "Yeh!" to these coined statements made by platitudinal politicians who don't believe in their own words? For most of the supporters of this view I doubt whether they have put much thought into these ideas, except for immediate anger over paying taxes or receiving a traffic ticket.

Is having a large central government detrimental to keeping a nation strong or having large government revenues harmful to a country's economy? People need to sober up and take a thoughtful second look.

When government is regulated by a constitution and its police force and judicial systems are independent of government interference then it is essential in order to make a strong nation that it has a strong centralized government with the financial wealth to be able to make big decisions. Why, you ask. There are many reasons.

The most important reason is to protect the nation from foreign forces, both militarily and economically. The reason for a strong military is obvious and needs little explanation. To have strong financial resources at a government's disposal is important to pay for policing and it's military.  Infrastructure is also an important factor here. Without access to a good transportation grid that's well maintained, a  country cannot get its goods to market. Without consistent delivery and access to electricity or other power sources a country would fall into the category of an undeveloped nation and quickly slide into poverty.
When government does not have the financial power to be able to stand up to Banks, or other forms of private enterprise then the people become vulnerable to the folly of that enterprise. As an example, when the government bought G.M. it saved approximately 1 million jobs and helped to stabilize the automotive industry. This could not have happened if the government did not have the financial resources to do this. If the government was too weak financially when 911 occurred then the government would have been helpless to do anything about it and Al Qaeda probably would have struck the U.S. again in some grandiose manner. If the government did not build the Hoover damn then there would have been little economic development in the Southwest of the country. If the government did not finance education then the majority of the people in the nation would be illiterate.

T he country doesn't need unbridled capitalism as there was in the late 1800's, nor does it need government controlling all of the industry.  Most countries thrive when there is regulated capitalism and occasionally the government intervenes to set direction or to avert disasters that can impact its people. In a democratic nation the government represents the people not itself or big business. Politicians who want to reduce the size of government significantly would like to go back to the days of the Industrial Revolution but do they really want to eat their food uninspected or do they want no regulations on Nuclear Power Plants. No Hoover Dam, N.A.S.A. or interstate highways?

Thursday, June 30, 2011

The Deficit Ceiling - Republicans Play Games

The Republicans have forgotten how to negotiate! They would like to push the country to the brink in order to score political points. While they're playing with fire, the country, and ultimately the world could dive into a new recession if we default on our debt. No government or opposition would ever have dreamed about doing such a thing in the past.

Are they insincere? Well, when you offer the Democrats 15% in raised revenues and 85% in cuts and then you quickly change and say you will only accept 100% cuts, this seems like game playing.  Especially when you consider that the Democrats were getting close to accepting their offer. Why change the offer when you are on the verge of a deal? Because you really aren't sincere about making a deal.

If the Republicans fail to make a deal by Aug. 2, then they will create an economic disaster that will not only effect the United States but also the rest of the world. You then could quite likely see a depression like the one in the 1930's.

It's likely the Republicans will agree to raise the debt ceiling and so it is important that the Democrats make some compromises but not give everything away. Much more posturing will be done before the deadline.