Archive for February, 2009

Obama and Fiscal Irresponsibility

Economics, Politics | Posted by C.C.Mitchell
Feb 26 2009

Just one short day after preaching fiscal responsibility in his Presidential Address, President Obama

Barack Obama

Barack Obama

unveiled his 2010 Fiscal Budget. The two events together amount to a multi-trillion dollar Oxymoron. A budget that will amount to $3.55 trillion of government spending. Every year the White House administration on watch puts together a spending plan for the year to run the government but this plan will run the government into the ground.

$3.55 trillion! $3.55 thousand-billion! $3,550,000,000,000! That’s a lot of zeros my friends.

By comparison, the 2008 Budget put forth by W. totaled just under 41% of GDP (Gross Domestic Product - the dollar value of all finished goods and services produced by a nation). That figure will rise to 64.6% under the Obama Regime. That’s a 23.6% increase over two years. Ever notice how generous politicians are with OUR money?

Back to all those zeros; 1.6 trillion of which goes towards Universal Health care, another Wall Street Bailout, and the wars in Iraq, and Afghanistan and the Stimulus PILL (its certainly a bitter pill). With expenditures at that level I find it hard to believe that President Obama will be able to cut the deficit in half and still keep his promise to give 95% of Americans a tax cut and only raise taxes on those making over a quarter-million dollars annually. He is going to have to lower the earnings level for that tax hike and every one in Washington knows it. There is no other way to pay for it.

The President is over optimistic about how fast the economy will recover. Even the Congressional Budget Office (CBO) thinks so as do many other predictors of economic growth. Obama is banking on the economy to recover quickly to produce the additional tax revenue needed to make the budget work, otherwise that $9.5 trillion debt will swell to even higher levels. The numbers are staggering.

The White House is projecting a 3.2% economic growth, while the CBO is predicting a 1.5% growth. As stated previously the White House is counting on that growth to produce additional tax revenues; and their estimate is 1.7% higher than that of the CBO.

Another hard sell is Obamas’ plan to reaise the Capital Gains Tax from 15% to 20% This would generate an additional $120 billion.

Obama said the government was going to have to make choices where spending cuts were concerned but the Republicans are hard pressed to FIND any spending cuts.

As typical of democrats the tax and spend motive hasn’t changed; they claim it will only rais taxes on the rich but republicans beg to differ with that thought.

Even so if you raise taxes on the rich:

  • They won’t Invest as much; taking away from the Capital Gains taxes they already collect.
  • They won’t spend as much on big ticket purchases like cars, Homes, and Vacations.
  • Those who are business owners won’t hire more or invest in their own businesses; small business is the back bone of the economy.

The Presidents plan doesn’t leave much motivation to prosper in a new socialist economy.

Though possible on paper, an awful lot has to go The Presidents way or we are headed for bigger deficits and bigger debts and bigger taxes. Looks like big government is here, at least for the next four years.

In short the Presidents’ new budget plan is big on spending, fat on taxation, and slim on fiscal responsibility.

Only in such a Cracked World as this can we expect to spend our way out of debt, but that’s democrats.

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Obamas’ Presidential Address All Pop and Fizzle

Politics | Posted by C.C.Mitchell
Feb 25 2009
The US Capital

The US Capital

The first Presidential Address by the new President Barrack Obama posed more questions than it answered among pundits of politics and economics. True, his richly delivered speech proclaimed on the grand scale many have come to expect from an Obama Speech. He is a good when it comes to such aural events as this. But his first trip to the Rotunda as Commander and Cheif was All Pop and Fizzle.

I have heard all of The Presidents’ speech at least twice. The phrase that comes to the forefront of my mind is that Talk is Cheap!

He tried to convince the American people that only those with a legitimate hard luck story would get help from our tax dollars. Many within his own administration don’t believe this.

The Speech to the Nation - POP

Just a few of the talking points in his speech that caused stirring among pundits and disbelief from others were quoted as such:

  1. “We have launched a housing plan that will help responsible families facing the threat of foreclosure lower their monthly payments and refinance their mortgages. It’s a plan that won’t help speculators or that neighbor down the street who bought a house he could never hope to afford, but it will help millions of Americans who are struggling with declining home values.”
  2. “We have known for decades that our survival depends on finding new sources of energy. Yet we import more oil today than ever before.”
  3. “We have already identified $2 trillion in savings over the next decade.”
  4. “Regulations were gutted for the sake of a quick profit at the expense of a healthy market. People bought homes they knew they couldn’t afford from banks and lenders who pushed those bad loans anyway. And all the while, critical debates and difficult decisions were put off for some other time on some other day.”
  5. We’ll reform our defense budget so that we’re not paying for Cold War-era weapons systems we don’t use.

The Fizzle

This all sounds great, but as I said, Talk is cheap.

For starters: The housing plan, is among economic pundits a bad plan where the math doesn’t work. I have covered this recently here. “It’s a plan that won’t help speculators or that neighbor down the street who bought a house he could never hope to afford”, to that FoxNews found a little tidbit of static for The Presidents clear and concise plan. It’s not likely aid will be denied to all homeowners who overstated their income or assets to get a mortgage they couldn’t afford said officials from the  Federal Deposit Insurance Corp. suggested this month. Also from a Fox News article,  Sheila Bair told National Public Radio,”I think it’s just simply impractical to try to do a forensic analysis of each and every one of these delinquent loans.”

His plan for energy independence relies completely on renewable alternative energy and totally ignores the opportunities for off-shore drilling that are the quickest and most obvious course of action to reduce our need for foreign oil. Clearly a short coming in the plan as a viable renewable source is decades away from being able to replace our entire energy infrastructure. This fact alone renders his plan ineffective.

“We have already identified $2 Trillion in savings over the next decade,” this whole statement is a ploy. It says I’m going to do “X” but it won’t actually happen until I am out of office. This allows him to take credit for future achievements and deflect blame if the plan fails onto his successor. By the way, every president pulls that one, not just Barrack Obama.

The blaming of deregulation by the Bush administration causing Wall Streets banking woes as stated by President Obama in many speeches and implied in his Presidential Address, fails to point out that it was his democrat predecessor who forced banks to allow mortgages without proof of income, credibility, or even a social security number. This allowed illegal aliens to buy homes in a country they have no right to be in in the first place.

He wants to eliminate “Cold War era weapons system we no longer use? Hmm, I certainly hope he waits until we have some newer ones first because in case he wasn’t paying attention, he sent another 17,000 troops to Afghanistan with Cold War era Weapons and Equipment. I must point out that The Clinton Administration made broad cuts to our military in his eight years and when we were attacked on September 11th of 2001 by Islamo-fascists, it cost Hundreds of billions of dollars to rebuild our forces which contributed greatly to our national deficit.

Whether we fought in Afghanistan or Iraq our military needed to be rebuilt to pre-Clinton era levels to fight the war effevtively.

Last but not least my favorite part was the crap storm he created when he said, “I believe the nation that invented the automobile cannot walk away from it.” News flash Mr. President this nation didn’t invent the automobile, Karl Benz of Germany invented the first automobile with a gasoline enginge in it, we made it affordable for the average citizen to own. That thanks goes to Henry Fords assembly line idea.

In a nutshell Obamas’ Pop and Fizzle Speech did little to shine on this Cracked World.

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Off-shore Drilling Uncertain

Politics | Posted by C.C.Mitchell
Feb 23 2009

It was in July of 2008 when President George W. Bush lifted the moratorium on off-shore oil drilling. Several months after, Congress followed suit by not renewing its restrictions. Before the ban was lifted, 85% of American coastal waters were off limits to off-shore drilling. More than 20 billion barrels of oil wait below the ocean floor to be tapped. This would end a need for Saudi  oil for 30 years.

In an attempt to procure the production of domestic oil and natural gas, the government has started a new plan; A proposal to lease the rights to energy companies to drill off-shore. This constitutes the first step in beginning the production of domestic oil [off-shore].

Most of these restrictions were put in place by envro-geeks at a time when gas was cheap. Last summer $4.00 a gallon gas prices spurred on public outcry for cheaper energy. Polls showed that Americans supported off-shore drilling by huge margins, Americans were fed up.

But now it could be back to the drawing board for the energy companies. Many members of Congress are considering a new imposition of an off-shore drilling ban. Signs show that The President may have similar inclinations.

This is a mistake any way you slice it. Taking away our ability to become self sufficient is not a way to break our dependency on foreign oil. As I have stated in the past, the currency exchange rate on the dollar is horrid. Domestic oil avoids that obstacle and provides oil and therefore gas at a cheaper price; freeing up more capital for investment in alternative fuel sources.

We can not overlook the number of people such an undertaking will employ. Unlike the stimulus jobs President Obama is fixated on, these jobs will be much more permanent, pay more, and are provided by the private sector. Meaning they are paid for by the private sector.

Such measures would also facilitate severing ties with middle eastern nations who love our money but hate our way of life.

Come on Mr. President, think of all the money we’d save that could be spent on alternative energy sources if its not being spent on stimulus jobs.

How could this be a bad idea?

  • Cuba and China are drilling oil 60 miles of Floridas’ coast. If we don’t drill it they will.
  • New drilling technology boasts a 99% clean drilling record.
  • Our Domestic Oil companies have to follow strict procedures regarding the environment that other countries do not.
  • A withdrawal of dependency on foreign oil.
  • Creates Thousands of new jobs.
  • Creates millions of dollars in new tax revenue.

Have I forgotten anything?

The current democrat controlled Congress has nothing to gain from a renewed moratorium. Accept for a power grab, and another opportunity to taunt the republicans with another chorus of We won the election, we’re in control now. Lord knows Nancy Pelosi has sang that song far too much already.

It’s time to act in the best interests of the country instead of the best interests of their party!

Once again, its a Cracked World.

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Oil is the Answer to Budget Shortfalls

Economics, Politics | Posted by C.C.Mitchell
Feb 22 2009

The fact that California is about $45 billion over budget, and is now relying on the Federal government to bail them out is laughable. Beg for money from the rest of the country during one of the greatest economic crises the country has seen in decades when they are sitting on a gold mine. A black-gold mine to be specific.

Off the shores of California are at least 18 billion barrels of oil and untold fortunes in natural gas. None of this will ever be tapped as long as tree hugging liberals are in control of the state. So while Californians are facing an increase of $10,000 in annual taxes to cover the budgetary needs of the state, there is a trillion dollars worth of oil revenues and royalties under the sea floor just a few miles off their coast.

Now just for a moment consider the number of jobs, high paying jobs at that, that these enviro-geeks are standing in the way of. With a clean drilling record of over 99% in the Gulf of Mexico since the 1970’s its pretty hard to see a reason not to drill for oil but out in the land of fruits and nuts anything is possible, (accept for a balanced budget).

Think of the oil resources that the entire country would benefit from. Oh but wait, we don’t need to drill our own oil, all we have to do is properly inflate our tires on our cars. California’s Bureau of Automotive Repair has been spending millions on a public education campaign called Drive Healthy: Along with The President they have been telling Californians (and the rest of us) that drilling our own oil is unnecessary because we can save as much oil as we could drill by inflating our tires.

They also say it would take ten years to start drilling. For one thing if we started ten years ago when President Clinton said this we wouldn’t be saying it today. For another thing thats an old ploy that won’t wash here because that estimate referrs to building and placing Oil Rigs and all the set up time. California has a number of oil rigs ready and waiting. Their ten years would be more like six months.

In the meantime we’ll just keep buying oil from foreigners with ridiculous currency exchange rates and send all of our revenues overseas to people who will in turn give that money to people who want to kill us.

So when Californians start to complain about all the extra $10,000 in taxes they have to pay, know this; its no ones fault but their own. They continue to elect and re-elect these tree hugging morons into office.

If there are any better ideas than drilling their own oil to pay for their budget I’d like to hear it.

Its a Cracked World!

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