Democracy and Power 103:  Government money

In general, the art of government consists in taking as much money as possible from one party of the citizens to give to the other.
– Voltaire (1764)

Money taxed and spent by politicians comes from the labor and ingenuity of millions of workers.  Politicians spend other peoples’ money.

Senator Max Baucus (D-MT) and Representative David Camp (R-MI) forged a “deal” on cutting the payroll tax until the end of 2012.  With this deal, 160 million workers will receive up to $2,000 more income this year.  Needless-to-say, those 160 million workers will gladly welcome the additional funds.  But beware, this is an election year ploy by both Republicans and Democrats to pander for votes.

Everyone knows America has a debt problem.  Few Americans know, however, that this “deal” will add $200 billion to our debt.  Immorally, these politicians – Democrats and Republicans – are predominately and overwhelmingly focused on being elected next November and less concerned about the consequences of their actions.   Most Americans are concerned about being employed, caring for their family, friends, neighbors and community, and, therefore, have little to no time to focus on America's big picture.  So, what does this “deal” do to America?

The “deal” itself is simple; every worker receives 2% more in income.  However, this simple legislation quickly becomes an ugly exchange of votes for favors by politicians.  Hence, the leaders of the Republican and Democratic parties basically bribed their legislators for their votes.

 What was added to the payroll cuts?

• There is the doctor fix.  Medicare payments to physicians were increased by about 30%,
• Long term unemployment benefits were extended.
• New federal workers can contribute more to their defined retirement plan.
• Federally controlled airwaves were auctioned off to wireless companies.
• $7 billion was cut from hospitals to cover debts.
• $5 billion was cut from ObamaCare’s prevention fund, which is used to help curb things like childhood diabetes and smoking.
• Medicaid payments were cut to Louisiana residents.
• Electronic welfare cards cannot be used at strip clubs, casinos and liquor stores.
• Federal payments to medical labs were reduced.
• Drug testing of unemployed people, who had tested positive before or who were seeking work in certain jobs, were implemented.

 What was proposed by our “honorable” lawmakers?

• Requiring Social Security numbers to utilize child tax credits.
• Unemployed persons must enroll for a high school GED.
• Higher contributions by federal workers to their defined benefit plans.

In the 18th century, when absolute monarchs ruled, Voltaire wrote:

In general, the art of government consists in taking as much money as possible from one party of the citizens to give to the other.

A century later, Otto von Bismarck of Prussia is reported to have said:

Laws are like sausages. It is better not to see them being made.

Alas, the political animal remains the same.  The political beast is best controlled by severely limiting their power.  To effectively limit their power, we can't let them take our money –  we must keep the tax-rate low.  Next, we can't let them create more debt.  There are many avenues to limit power and stop debt accretion.  Making politicians personally and financially responsible is one such avenue.

Alas, We the People have a gigantic struggle to limit the power of our elected elites.

Democracy and Power 104: Future Debt Burden

Blessed are the young, for they shall inherit the national debt. – Herbert Hoover

All democracies institute programs for current voters and shift the debt to future workers, even the unborn.  Social Security, Medicare, prescription drug benefits for seniors are prime examples in America.

Obama Burdens America’s Children with $5trillion more Debt

Bush II spent much too much money and increased our debt.  President Obama spent more money, and in four years increased our debt by $5 trillion.  Debt is an unpaid tax that is pushed off to be paid by future workers, i.e. our children and grandchildren. President Hoover once said, "Blessed are the young, for they shall inherit the national debt."  Sad but true; this is an immoral burden on the young and unborn.  [Read: http://www.freedomworks.org/blog/teda/when-pretending-fails-to-hide-bankruptcy]

How have the political elites failed America and America’s children?  First, the federal government has not had a budget for over 2 years.  A budget is a road map to balancing anticipated revenues with authorized expenditures.  No institution can exist without a budget.  Intentionally and harmfully, Congress and the President have breached their most basic duty of establishing and honoring a budget. 

Last year, President Obama presented a budget that was so incompetent that the Senate defeated his proposal by 97 to 0.  Representative Paul Ryan (R-WI) proposed his Path to Prosperity, which cut spending.  Promptly, Obama invited Ryan to hear the President speak on the budget, where the President personally ridiculed Ryan.  Intriguingly, in response to Ryan’s Path to Prosperity, President Obama then offered a second budget, which cut spending from the President’s original budget.  Ultimately, America in 2011 did not have a budget.  The deficit was over a trillion dollars.  Unbeknownst to most young Americans, they got “another day older and deeper in debt.”

Now it is an election year and President Obama is proposing more spending and an additional trillion dollar deficit.  Obama wants more money for “career centers” in community colleges, extending unemployment benefits, more money to k-12 education, control over interest rates on college tuition debts, more money for basic research at universities, money for clean energy, money to prevent wasting energy, money for roads and bridges, more money for the Internet, money for a financial crimes unit, and another bureaucracy to investigate risky loans and packaging of mortgages. 

Additionally, President Obama wants to bailout homeowners to refinance at a lower interest rate.  Admitting a previous program was unsuccessful, Obama wants to spend $10 billion more.  Please know that every request by Mr. Obama is maintained by a confussing array of existing federal programs run by thousands of bureaucrats, which control billions of dollars. 

Obviously in a typical election ploy, President Obama has pandered to every interest group for his re-election.  Sadly, Mr. Obama insists on more money to be tranferred to large voting groups, and refuses to direct and supervise the bureaucracy.  Instead of buying votes and coddling federal employees, the Chief Executive Officer (CEO) of the United States of America should be demanding that the gigantic federal bureaucracy cut spending, initiate new priorities and save America billions of dollars.

Simultaneously, the CEO of America must seek solutions to the ever-increasing debt.  In addition to Obama’s $5trillion increase, the big drivers of debt are Social Security, Medicare, and Medicaid.  These three federal programs are 44% of the expenditures in 2012.  In 2022, they will be 54% of the federal expenditures.   The following is a recent report by Douglas Elmendorf the Director of Congressional Budget Office (CBO) as reported by the Wall Street Journal:  

 Mr. Elmendorf warned that the primary driver of the deficit later this decade would be the cost of an aging U.S. population, particularly the rising costs of government health-care programs. For example, the CBO projected the government would spend $1.6 trillion on Social Security, Medicare, and Medicaid in 2012, 44% of the federal budget. In 2022, the government will spend $3.0 trillion on those programs, 54% of the federal budget.

Who will ultimately pay for all of this spending?  Remember Herbert Hoover, "Blessed are the young, for they shall inherit the national debt."

America needs a President and Congress which has the integrity and courage to concentrate on the debt and the drivers of debt – Social Security, Medicare and Medicaid.  A few politicians have made references to the problem.  Some like Ryan have made bold solutions.  Legislatively and administratively nothing has been done by President Obama or Congress to reduce the debt, and, until the young people of America communicate their distain for the politicians, little will happen.

Pity the young and the unborn. [Read: http://www.freedomworks.org/blog/teda/stop-the-fiscal-war-against-our-children-now]

Democracy and Power 114:  The Power Players

Who actually controls the force of government?   The politicians and interest groups control the American political process.  Special interest groups – big business, small business, unions, education, seniors, and a multitude of others - seek favors: tax breaks, subsidies, exclusive legislation, etc.  Interest groups give enormous money to political campaigns, and receive gigantic benefits in return.

 What compelled Congress to name and pass the 2007 Honest Leadership and Open Government Act?  As if honest leadership could be legislated.  Actually, the legislation was the result of the Jack Abramoff scandal and gives more insight into the nexus between special-interest donations and powerful politicians.

Within the next few months, the Super Committee will make an important decision affecting public policy and many industries.  AT&T, Microsoft, Duke Energy and many other enterprises have important of issues pending in Congress and have “bundled money” to many members of the Super Committee.

What is bundling? “Bundlers” — companies and lobbyists who cut big checks and pile up scores of smaller donations.  Needless-to-say, a bundler has a lot of power with Congress.  Politico reports that the Super Committee members have received $1.6 million from bundlers.  

Of course, Members of Congress refute succumbing to undue influence.  Read their explanations:

“There are a lot of members of Congress, and we all have multitasks, including all having to run for election, and so we take our responsibilities seriously,” Sen. Murray (D-WA) told Politico. “The select committee is no different than anybody else” in Congress.

Sen. Kerry's (D-MA) spokesperson, Jodi Seth, said those two bundlers were disclosed after a December 2010 event honoring Kerry’s 45 years of public service. She said the senator’s votes are strictly rooted in the interests of his state and his personal beliefs — “and nothing else.”

Now, the assuring words of two lobbyists - John Podesta andTony Podesta.  John was Chief of staff for Bill Clinton.

In an interview, Podesta (John) downplayed that lobbyists’ history of fundraising would have a real effect on the supercommittee’s final result, saying the members won’t have a “special window for bundlers.”

“I don’t think they’ll be tallying to see who did what for them,” Tony Podesta added.

Then, why bundle?  Obviously, the executives of AT&T, Microsoft and Duke Energy know this is an effective means to gain access to power.

Why do elected officials participate?  Simple, elected officials always need money to campaign for themselves and their party and the bundlers are providing it – big time.

How do American citizens counter-act these collusions?  Encouragingly, We the People took the first step and voted wastrel politicians out of office.  The election of 2010 was a great success.  The election of 2012 is extremely important.  We the People must convince the independent voter to vote for candidates supporting less taxes and more freedom.

Next, join FreedomWorks, which has strong and constant relationships with the increasing number of politicians dedicated to a limited government.  The combined power of grassroots voters and direct contact with politicians is the most powerful force against the lobbyist, bundlers and spendthrift politicians.  FreedomWorks is the most powerful force against the “good old boy” politics of DC.

Democracy and Power 104: Future Debt Burden

A government debt is a government claim against personal income and private property – an unpaid tax bill. – Hans F. Sennholz,

All democracies institute programs for current voters and shift the debt to future workers, even the unborn.  Social Security, Medicare, prescriptions drug benefits for seniors are prime examples in America.

Team Obama has made a major 2012 campaign  decision.  Ross Douthat of the New York Times states the theme: “Tax the rich, and Medicare forever.”

Claiming to reduce the deficit, the President proposes taxing the rich, leaving Medicare intact and insignificantly tinkering with Social Security.  Hence, the President totally ignores the source for America’s enormous and dangerous debt – Social Security, Medicare and Medicaid.  In his article, Douthat most closely refers to Nancy Pelosi as representing the hardcore liberal base of the Democratic Party.  However, this strategy is reminiscent of Nancy Pelosi’s claim in 2005 that Social Security was not bankrupt.  If you need a quick reminder of Pelosi's claims, read the transcript of Pelosi and Chris Wallace in 2005, as reported by Fox News:

PELOSI: … Your previous speaker said incorrectly that Social Security would be in the red in 2018. That's simply not true. The more money going out than coming in doesn't start until 2030. There's time for us to do this right.  …

WALLACE: But I just want to make sure, Congresswoman Pelosi, you know, we're talking about Social Security, the Democratic social program. I didn't hear anything about raising taxes. I didn't hear anything...

PELOSI: Of course you didn't.

WALLACE: ... about cutting benefits. There doesn't seem to be any plan that you are offering to solve the long-term solvency.

PELOSI: Chris, the issue is solvency, and the issue of solvency is one that President Reagan and Tip O'Neill addressed in 1983. They took measures...

WALLACE: But there's a problem now. I'm asking you, do you have an answer?

PELOSI: They had a crisis at that time. There is no crisis, as the president indicated to us in our private meeting with him until he went out and said, "It's a crisis. It's bankrupt." That's not the case.

What we have to do is come together in a bipartisan way at the table, bringing principles that say we cannot begin by slashing benefits. We must stop robbing Social Security's trust fund of its money to pay for other things to cover the enormous deficits in the Bush reckless economic polict, in my view.

Six and half years have passed since Pelosi's conversation with Chris Wallace and the Bush and Obama administrations with the participation of Pelosi and Congress have continued to rob the Social Security “trust fund.”  Be aware, every sane politician knows there is no trust fund and the drivers of America’s precarious debt are Social Security, Medicare and Medicaid.  Additionally, every sane politician knows a year-long delay greatly exacerbates the debt.

This is the deplorable state of American politics.  When Representative Ryan published his Path to Prosperity with proposals to restructure Medicare, the President and Democrats simply resorted to demagoguery.

Now, we enter the 2012 election campaign with no serious discussion for reducing the debt. 

Only We the People can put an end to these despicable political deceptions.  The 2012 election is critical to the future of democracy in America. 

Additionally, only a system of personal accounts for Social Security and medical care will prevent the continuation of this political corruption.

Campaigned on ”Balanced Budgets," Votes for Bigger Government and More Debt

Back in 2006, Jon Tester, an average American farmer from the state of Montana, ran his campaign for Senate with the promise of fighting for a balanced budget and fiscal responsibility. It is now 2011 and with a MAJOR debt crisis on our hands, Mr. Tester’s words appear to have been empty.

Senator Tester has supported numerous bills that support fiscal IRRESPONSIBILITY and moved us in the opposite direction of a balanced budget. These include:

• Voted to raise the national debt ceiling which would allow the government to FURTHER increase its spending. He was quoted saying, "We have to address the debt ceiling. The debt ceiling has to be raised."
• Voted yes for Obamacare. He stated, “I stand by my vote for health insurance reform because it was the right thing to do for Montana families, small businesses, family farms and ranches, seniors and veterans.” Actually, Obamacare will increase taxes across the country, hurting business and economic activity. Businesses will be forced to cut back which will inevitably RAISE unemployment.
• Voted yes on increased spending for failed stimulus programs such as Cash For Clunkers
• Voted no on barring EPA from regulating greenhouse gases.
• Voted yes on Dodd-Frank, a law that places an incredible amount of regulation on financial institutions. Banks will be forced to make up for this in charges elsewhere such as credit and debit card transactions, making it more expensive for consumers.

From the looks of it, when Mr. Tester said “fiscal responsibility,” what he meant was more spending and job-killing regulation. 

Democracy and Power 114:  The Power Players

 Who actually controls the force of government?   The politicians and interest groups control the American political process.  The politician seeks power.  Special interest groups – big business, big unions, education, seniors, and a multitude of others - seek favors: tax breaks, subsidies, exclusive legislation, etc.  Interest groups give enormous money to political campaigns, and receive gigantic benefits in return.

Gretchen Morgenson and Joshua Rosner of the New York Times have written “Reckless Endangerment” exposing corruption between special-interest predators and DC politicians. 

Recently, David Brooks reviewed the book and, according to "Reckless Endangerment," Fannie Mae was created and protected by the Federal government.  With Federal privileges and guarantees, Fannie  Mae's expanded loans made enormous profits.  From the profits, the executives paid themselves lavish bonuses and bought political support.  As Brooks reveals, Fannie Mae consolidated their power just like other special interest groups:

Fannie Mae co-opted relevant activist groups, handing out money to Acorn, the Congressional Black Caucus, the Congressional Hispanic Caucus and other groups that it might need on its side.…

Fannie lavished campaign contributions on members of Congress. Time and again experts would go before some Congressional committee to warn that Fannie was lowering borrowing standards and posing an enormous risk to taxpayers. Phalanxes of congressmen would be mobilized to bludgeon the experts and kill unfriendly legislation.

Destructively, Fannie Mae, Congress and the special-interest predators were the major cause of the America’s financial crisis.  What haunts Brooks is the devastation is caused by the "normal" political process in DC.   The despicable collusion between predators and Members of Congress.

Washington is home to a vertiginous tangle of industry associations, activist groups, think tanks and communications shops. These forces have overwhelmed the government that was originally conceived by the founders.

Of course this collusion is exactly what the Tea Party activist and the independent voter has sensed – DC is corrupt.

Brooks does not refer to the Tea Party or independent voter, but fears a populist rebellion.  And implies the rulers had better reform or the hoi polloi might wreck havoc on them and the country.

No, a peaceful rebellion continues.  In 2008, Americans voted for Obama...in hopes of seeking change.  Instead of change, America got Chicago gangsterism.  Thus, the independent voter is disillusioned at the corruption and coercion used to pass ObamaCare and the crony collusion between big banks and Congress resulting in the Dodd-Frank.

Hence, in 2010 the Tea Party-activist and the independent citizen voted against DC corruption. However, electing new Members of Congress is not sufficient and the citizens are demanding Constitutional restraints, i.e., a balance budget amendment restricting spending to 18 percent. 

Only because the citizens are outraged are spending cuts and a balanced budget amendment considered by the politicians.  We the People must continue the peaceful rebellion. 

The 2012 election will be extremely important.  Our freedom and the freedom of the world depend upon the American voters.  Only an informed and voting electorate can save democracy from these ever present predators.