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Wherever politics intrudes upon economic life, political success is readily attained by saying what people like to hear rather than what is demonstrably true. Instead of safeguarding truth and honesty, the state then tends to become a major source of insincerity and mendacity. – Hans F. SennholzThe Conniving Five – Obama, Pelosi, Reid, Boehner and McConnell
Would you hire the investment firm of Obama, Pelosi, Reid, Boehner and McConnell to manage your money? Never.
Yet with the fiscal cliff (enormous tax increases and indiscriminate program reductions) looming ahead of us, these five people will meet next Tuesday to discuss our fate. Then, the Conniving Five will decide how much of every worker's wage will be confiscated by the government. Their decision will have significant repercussions on America's immediate and long-term futures. The Hill quotes the President:
Obama invited lawmakers to the White House next week to begin discussing how to “build consensus on the challenges that we can only solve together."
Of course, the President's “….we can only solve together” refers to the Conniving Five – not the American people. Beware America, these five will most likely cut their deal behind closed doors without a national debate. Devious and scary!
Of course, Obama wants more taxes. Initially, it will appear only the rich are being taxed, but eventually every worker will be taxed. Why? Under Obama's budget, if government confiscated all of the rich's income, the deficit and debt would still expand. Again, Obama:
“If we’re serious about reducing the deficit, we have to combine spending cuts with revenue and that means asking the wealthiest Americans to pay a little more in taxes,” Obama said. “That’s how we did it in the 1990s when Bill Clinton was president, that’s how we can reduce the deficit while still making the investments we need to build a strong middle class and a strong economy.”
Horrifically, Clinton is why We the People must demand an open and honest debate. Let me remind you how good, old Bill Clinton hid and added to the debt.
In 1993, Alice Rivlin of the Clinton Administration recruited Professor Laurence Kotlikoff, an expert on the debt. Kotlikoff measured the fiscal gap – government obligations versus revenues to infinitive. Rivlin recognized Kotlikoff's measurement was more honest and accurate than the government's accounting and intended to use it in the next federal budget. Unfortunately, Kotlikoff's measurement proved Clinton's policies were expanding the debt. So, Kotlikoff's honest assessment of the debt was snuffed. In 2011, Kotlikoff wrote an article on Bloomberg on how Clinton killed his study and the truth:
... Back in 1993, Alice Rivlin, then deputy director of the Office of Management and Budget, asked me and economists Alan Auerbach and Jagadeesh Gokhale to prepare a long-term fiscal gap/generational accounting for inclusion in President Bill Clinton’s 1994 budget.
We worked for months on the analysis, but two days before the budget’s release, the study was excised from the budget. We were shocked, but, in retrospect, the politics are clear. The Clinton administration wanted to claim it was fiscally prudent and the study, which showed unofficial debt growing at enormous rates, showed the opposite.
Harmfully, the federal government never adopted Kotlikoff's method. Today, how big is the fiscal gap? Over $200 trillion. Obviously, that is enormously larger than the government's claim of a $16 trillion debt. What is the big difference? Mostly accounting for unfunded programs - Medicare, Medicaid and Social Security.
So, in terms our current fiscal cliff, the Conniving Five deviously and intentionally created the cliff to be activated after the 2012 election, and the same Five will play politics as usual – obfuscate, deceive, disguise and prolong the debt.
As Hans F. Sennholz said, "Instead of safeguarding truth and honesty, the state then tends to become a major source of insincerity and mendacity." We the People must demand an open and honest debate. We must be included in the debate and finding a solution.
For more detail on Kotlikoff's fiscal gap: