Double Dip??

"The problem with these downgrades is that they have a tendency to quickly spiral out of control."

 - John Lott, Fox News

Yes, I know...I haven't blogged in a while. In the past eight months I had a baby, my husband left his job, he took a few months off, and recently started a new one. Life has been crazy; however, I am planning on slowly working my way back into my conservative blog. And with my older kiddos out with their aunt and uncle tonight, I wanted to post something about the recent S&P downgrade of American debt. 

This article speaks to the serious nature of this recent development. It's a quick read and will give you some thought as to what may lie ahead for this country. It's serious. And in the words of Mr. Lott: "S&P's decision to downgrade the U.S. bond rating isn't a real disaster yet, but it is a wake up call. And it's one that should force Washington's politicians to re-examine the debt ceiling deal that they just made."

I was really disappointed with the recent debt ceiling deal. It's not enough. Nobody will touch entitlement programs and that's the meat and potatoes of our country's problems. I want someone with guts to get in there and get it done. Which speaks to my thoughts about the 2012 election. I'm not sure which Republican can take this on....that has yet to be seen, but I'm waiting to be impressed. 

Our President continues to show his hand of inexperience. Words and speeches will not solve our economic and debt problems. Jobs are the core. Businesses need to have a better outlook to hire. They need certainty in the marketplace. Until there are jobs, we will continue on this path. 

Read the full article here. Obama promised change, but it's not the kind of change that has brought America back to prosperity. Things could get ugly unless REAL positive change happens NOW.

Source: Fox News Opinion, 08/05/2011

Too Good to be True? Then it's not true...

"Yesterday Mr. Obama again invoked the 'nonpartisan, independent' authority of CBO*, which misses the reality that if you feed the agency phony premises, you are going to get phony results at the other end."

 - WSJ 03.04.10

"Hiding spending doesn't reduce spending."

 - Rep. Paul Ryan (R - Wisconsin)

In case you were wondering, I am still opposed to Obama's bill...although it has yet to be drafted. The abortion language is a major hiccup, especially for a large group in the House, and a MAJOR hiccup is the cost.   

The Wall Street Journal published an Op Ed Thursday discussing the blatant falsehoods with which Obama touts this bill. The commentary is based on Rep. Paul Ryan's comments from the Health Care Summit, which Democrats and the President himself have yet to refute...because they can't.  Ryan has this thing sorted out.  

BACKGROUND:  I used to work at Boeing.  In a nutshell my job required meeting with Engineers and Project Managers charged with developing new products to create a business case estimating total costs of production, how to amortize and allocate costs, and developing a pricing scheme based on a profit margin target.  It was extensive work...loads and loads of Excel spreadsheets...*sigh*...sometimes I miss it. 

It didn't take long to learn the most important aspect of my job and my estimates:

ASSUMPTIONS

The assumptions, which act as the foundation for an estimate, will make or break the outcome, final numbers and subsequent "Go - No Go" decisions.  

Obama claims his bill is "fully paid for" and "cuts the deficit" and brings the "largest tax cuts to middle class families in history".  But his claims are based on half-truths and deceptive assumptions.  Here are a few:

• Obama has accounted for 10 years worth of taxes but only 6 years of spending. 
• Obama claims the bill will only cost $100 billion/year, but forgets to take into account how the cost will increase every year the program is in existence.
• Obama says cost offsets will come from cuts in Medicare, but everyone knows they will postpone these reductions (they always do); thus the touted savings will evaporate.  And even if they allow the cuts to pass, "Using Medicare as a piggy bank...raids a half trillion dollars from retirees health coverage to fund the creation of another open-ended health care entitlement." Our government cannot run Medicare profitably, what makes you think they can run health care for the entire country?
• Some of the savings is claimed from increased Social Security payroll revenue.  This is an obvious double-dip...and a reason Social Security is upside-down...those funds should be saved/invested for OUR Social Security.
• Obama claims additional savings from CLASS Act long-term care insurance. "These so-called savings are not offsets, but rather premiums collected to pay for future benefits."  

Paul Ryan says, "When you strip [this] away...the deficit increases by $460 billion over first ten years and $1.4 trillion over second ten years."  And some aspects of Paul Ryan's estimate is pretty conservative.   

So despite our disagreements about Health Care reform and this plan's provisions, when it comes to the nitty gritty, the plan is expensive...and your grandchildren are already on the hook to pay for it.  Now that doesn't seem right now does it?

*CBO = The Congressional Budget Office, which aids the legislative body in analyzing bills and providing data to assist in making budgetary decisions.  AKA...they run the numbers.  

Sources:

WSJ Op-Ed

Paul Ryan's Statements from Health Care Summit

El Rushbo's Commentary

Profits. Bad?

Seems backward, right?  All of this loathing of businesses because they earn a profit. The headlines and commentary over the past few weeks have been bugging me.  Those "banks on Wall Street" can't catch a break.  And now some of these bank executives are earning a bonus because they've turned a profit and that's bad?  Is this really criminal?

Um, hello?  Has anybody taken a basic economics class?

Well, I have...way back in the day, and I do remember this:

ECON 101

Profits:  goooood

Most companies use a system of quantitative/qualitative performance measures. If the measures are met they are rewarded. It seems logical for executives who made changes which allowed their companies to repay TARP loans and earn a profit deserve some type of compensation.  I would presume in most cases the bonus is well-deserved and based on a series of audits of their performance results.   Of course not everyone on "Wall Street" is good.  I'm not naive that corruption exists on Wall Street, but I also believe it exists on any street, including Pennsylvania Avenue.  It's easy to point the finger.

Now consider our government, which ignores spending control and instead expands programs and draws more loans.  The end result is a "company" further in debt with no outlook for profitability. Is anybody berating our government's compensation?  My big beef with some of our government entitlement programs is all this talk of expansion. Let's help Medicaid, Welfare, Unemployment benefits, etc. reach MORE people for LONGER.  Does anyone see a problem in this?

*me raising hand*

The most successful welfare program does not tout how many people it can support, but how many no longer require its services.  Let's get people on their feet rather than in a state of never-ending dependency.  Welfare should be a short-term fix rather than a long-term solution.

I suggest we applaud the profitable businesses.  ANY profitable business, whether on or off Wall Street.  A profitable company is a company in position to add jobs.  Obama should reconsider his "Jobs Bill", (a fancy name change from 'Stimulus' which is now taboo after its utter failure last year) and focus instead on helping companies improve their financial bottom line.

That, my friends, is where the REAL jobs are found.

BEWARE! Gimmicks Ahead

Obama saying he will halt spending is like a woman saying she's only a little bit pregnant.

- Mark Steyn (Rush Limbaugh Show)

The State of the Union is tomorrow and the talk today is all about Obama's announcement to freeze spending. Initially I think, okay, great! Now that is what I'm talking about! But then I read the fine print...

Check the exclusions:

- Defense, Veterans Affairs, Homeland Security and foreign affairs

- Medicare/Medicaid, Social Security

- Job Creation spending

- A follow-up stimulus bill

- Health Care spending

Is it just me or does it appear the only programs left are federal port-a-potty cleaners and IRS lunch ladies?

And, my friends, there is no cutting going on here. This is simply halting spending for these programs at their existing levels for three years. It's obvious to anyone with half a brain this plan won't make a dent in our current $12 trillion debt (which is continuing to skyrocket). The Obama administration promises a savings of $250 billion over the next 10 years. Really? That's all you've got? That's about .058% of the budget...roughly half of one percent of the federal budget over that same time period.

IT WON'T HELP. As Mark Steyn said today, we are spending our children's and grandchildren's future. They won't understand the term "The American Dream" because there won't be one.

I love this quote: "Spending is a means of control...Spending is a liberty issue. Every time Obama takes money from you to spend on something the government does, that's a dollar that the state decides how to spend and the citizen doesn't."

Government does not get smaller, as evidenced by the lack of actual/physical/calculable cuts. It only gets bigger. And with each increase we see a little piece of a our liberty fly away, which is one of my main beefs with health care reform.

Even the mainstream media outlets are suggesting the freeze will have minimal effect on our national debt. Newsweek today said:

"Sure, it adds to the image of a president who's committed to reducing the deficit [REESE sidenote: Ummm...not sure what image Newsweek is referring to...in my humble opinion, I would say Obama has shown very little committment to reducing the deficit. Hello?], but it feels more like a gimmick than a realistic solution, particularly with a Congress more concerned about protecting its immediate political interests...than engaging in a cooperative attempt to tackle long-term economic issues.

Gimmick is probably the right word. We'll see what other gimmicks the president has up his sleeve at the State of the Union tomorrow. If Obama thinks this is being fiscally responsible, maybe he just doesn't really KNOW how large of a deficit we're dealing with.

Source:
Newsweek article
Mark Steyn on Rush
White House Briefing