Obama Budget Doubles Deficit in 5 Years Triples it in 10

Senator Lindsey Graham talked with bloggers today about President Obama’s budget plan. In short, spending is going way up in all areas except for military and defense spending, which will be cut. For President Obama’s budget to add up he has to take an extremely rosy view of the future. His administration is betting that unemployment will peak this year at a little over eight percent, and they are predicting a substantial economic recovery for next year. His view of the current world situation is also extremely optimistic, as he sees little need for spending on military and defense. Unfortunately, there are logistical problems in taking this perspective since, as Senator Graham put it, “We are flying the wings off our airplanes.” Finally, President Obama has included in his budget a plan for cap and trade that Senator Graham explained is far more costly than the McCain - Lieberman - Warner versions of cap and trade that have been introduced and debated in the past. Senator Graham stated that this is old fashion big government liberalism. He went on to say that in 2007 Senator Obama was ranked the most liberal Senator, and that his policies reflect that, that he simply took a year off from liberalism to run for President.

The problem with all this government spending is three fold. We can’t afford it. The likelihood of massive inflation is extremely high. We are burdening tax payers for generations to come with a huge debt that will almost certainly lead to higher taxes. (The fact China owns a huge amount of our debt is not comforting either.) This isn’t as much about partisanship, or liberalism as it is about bad math. Debts have to be paid, and the numbers are being manipulated to try to pretend that this plan adds up when it does not.

Obama Budget Doubles Deficit in 5 Years Triples it in 10

Pro-Growth is Most Fair Option

Unfortunately, many in America are losing track of the logistics of the economy and are getting caught up in emotion. People are angry about bailouts and white collar crooks running ponzi schemes and are becoming resentful towards big business and the wealthy. Yet we risk losing site of the real goal of turning the economy around when emotion and arguments about fairness start start trumping logic and math. The reason not to raise taxes on the rich, businesses, and capital gains is not because one loves, hates, or feels indifferently about wealthy people. The reason not to raise taxes on those of means is because they are the ones able to create jobs, and invest in the businesses that are so desperately needed right now. The argument that the rich should pay more because that is what is fair ignores the fact that, particularly in a struggling economy, increasing taxes slows growth. Consequently economic recovery slows, and that is fair to no one. In reality when the economy slumps those just getting by pay check to pay check suffer the most. The rich may not be as rich as before, but they're still rich. Those being laid off and struggling to pay their bills are hurt the most in a prolonged recession, and implementing policies that hinder growth is not fair to anyone.

Also, small business owners are being grouped into the 'rich' category in an unfair manner. If a small business owner makes $250,000 a year that becomes a rather average income if he or she has to pay two to three employees salaries with that income. Also if they are trying to grow their business, it is likely a chunk of that income is being put right back into their business. That isn't the life of the highly privileged wealthy class. We'd be well served by taking the emotion and morality judgments out of economic policy, and simply look for policies that are pro-growth.

Larry Kudlow and Donald Luskin voice their frustration about the current policies that are anti-growth. Certainly, not unemotional in their criticism, they point out why a pro-growth strategy is simply the most fair economic strategy for all Americans.

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Pro Growth is What is Truly Fair

McCain Upset About Earmark Broken Promise

President Obama's Address

There’s no denying that President Obama is one of the most eloquent politicians to come along in a long time. That was on display last night in his address to the joint session of Congress. The President put forth ideas that certainly show a shift in direction from the previous administration. It was nice to see energy and the environment move up the ladder of national priorities. The president also did a nice job in using his popularity with young people to tell them that he expects that they not only graduate high school, but further their education beyond high school, and he framed it well in terms of being a responsibility of citizenship.

What didn’t add up about the President’s speech was the math. President Obama laid out a number of ambitious goals one of which was cutting the national deficit in half by the year 2013. However, instituting programs such as national health care, making college accessible to all citizens, and instituting a cap and trade initiative on carbon emission is beyond ambitious when also trying to cut the deficit. With a huge stimulus package that just passed, a large appropriations bill about to come up for debate, and the possibly of more money needed for bailout plans, it seems highly unlikely that the national debt will do anything other than balloon even further. This isn’t just an issue of a theoretical debt that will some day have to be paid by the tax payer. This is a basic math problem that could negatively impact the economy for years to come. Government services take on an added appeal if the price tag is ignored, and a better explanation needs to be given of the cost to taxpayers before these programs are rubber stamped.

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President Obama’s Address

Rewarding Bad Behavior

With the recent unveiling of the Obama administration's housing plan there is a growing concern that the government is promoting policies that reward bad behavior and punish good behavior. The housing plan is the latest policy where the government gives money to those who are in over there head. This is a somewhat more palatable policy than preceding bailouts as it focusses on helping the individual with mortgage problems. However, it is following a string of policies that that basically says 'if you screw up, the government is here to give you money.' Businesses and individuals that pay their bills and taxes on time are subsidizing those who don't. The housing plan isn't completely without merit, but this trend of government bailouts big and small is wearing on many as can be seen in this CNBC clip of Rick Santelli becoming fed up with the government rewards for bad behavior on the floor of the Chicago Stock Exchange...

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Punishing Good Behavior

Graham - Don't Tell Me This is Change That I Can Believe In

Stimulating Math

With the Economic Stimulus approaching the $1 trillion mark, lets look at what $1,000,000,000,000.00 equates to…

$1,597,444 check for all of the 626,000 people that have filed unemployment claims this month.

$227,272 check for all 4.4 million people collecting unemployment benefits.

$333.33 check for every American man, woman, and child.

It would take a worker making $50,000 a year 20 million years to earn $1 trillion.

If ever ticket of every home Red Sox home game at Fenway Park for the 2009 season was sold for $308,642.00 each that would equal $1 trillion.

The GDP of Mexico is just over $1 trillion.

The GDP of India is also just over $1 trillion.

The combine GDP of the following countries is approximately $1 trillion…

Uruguay, Lebanon, Yemen, Uzbekistan, North Korea, Cyprus, Estonia, Ethiopia, Cameroon, Trinidad and Tobago, Ivory Coast, Panama, El Salvador, Tanzania, Equatorial Guinea, Iceland, Bahrain, Bosnia and Herzegovina, Macau, Jordan, Bolivia, Ghana, Brunei, Paraguay, Gabon, Zambia, Uganda, Senegal, Botswana, Honduras, Burma, Albania, Jamaica, Republic of the Congo, Georgia, Democratic Republic of the Congo, Afghanistan, Nepal, Armenia, Cambodia, Mozambique, Madagascar, Republic of Macedonia, Chad, Mali, Malta, Burkina Faso, Mauritius, Namibia, Haiti, Benin, The Bahamas, West Bank and Gaza, Nicaragua, Papua New Guinea, Moldova, Niger, Laos, Jersey, Kyrgyzstan, Liechtenstein, Mongolia, Tajikistan, Aruba, Zimbabwe, Montenegro, Guinea, Malawi, Rwanda, French Polynesia, Fiji, Barbados, Mauritania, New Caledonia, Kosovo, Togo, Suriname, Swaziland, Guam, Guernsey, Isle of Man, Somalia, Central African Republic, Sierra Leone, Cape Verde, Faroe Islands, Greenland, Lesotho, Eritrea, Belize, Bhutan, Maldives, Guyana, Antigua and Barbuda, Gibraltar, San Marino, Saint Lucia, Djibouti, Liberia, Burundi, British Virgin Islands, The Gambia, Seychelles, Grenada, Northern Mariana Islands, Saint Vincent and the Grenadines, Vanuatu, Saint Kitts and Nevis, Comoros, Samoa, East Timor, Solomon Islands, Guinea-Bissau, Dominica, American Samoa, Tonga, Micronesia, Cook Islands, Palau, São Tomé and Príncipe, Marshall Islands, Anguilla, Kiribati, Tuvalu
 
If you'd like your political representatives to now what $1 trillion equates to, their contact info can be found at...
 
Senators - http://www.senate.gov/general/contact_information/senators_cfm.cfm
 
Representatives - https://writerep.house.gov/writerep/welcome.shtml
 

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Stimulating Math