16 JAN 2010, Saturday

1. Happy Birthday to me!
2. Interesting video about people having had enough fo the current Washington DC games.  NOTE:  It has been taken down from YouTube several times already...and put back up by other posters.  Interesting...why and who keeps taking it down???  Freedom of speech infringement?  Who knows...if it's there...enjoy!
3. Well...Con-gress is back in town and will commence hurtling toward the edge of the cliff once again.
4. Gosh, I hope Scott Brown wins the Massachusetts Senator seat (Kennedy's old one) and brings some much needed gridlock to allow our illustrious leadership to slow the heck down and actually think about what they are doing both short and long term.
5. Consider, just for a moment please....

What if the current level of reduced tax revenue to government, at all levels, is closer to the norm of what we may expect over the next 5-7 years??? What true plans, not just "papered over and passed on" plans, are being developed to prepare for that possibility?  This is the nightmare scenario that we will face if the Bond Market finally says to Uncle Sam "Oh no...no mas!" regarding the ongoing ridiculous deficit financing.  At that point the Federal government will force all IRA's, 401K's and all pension plans to purchase 100% US Treasury Bonds.  Can't happen?  Already has...two that come to mind from the 1990's, South Korea (seized all citizen's gold also) and Argentina (hell, the government just took all the money).  We are not immune from financial reality merely because we are America!  Please do not delude yourself or go ostrich when, instead, you need to be as active as you can be.  Anyway, read on...

Below excerpt picked up from Heritage's blog but completely sums up my thoughts....

Harvard’s Stephen Goldsmith has discussed why it’s time for all levels of government, from local to federal, to come to grips with the fact that today’s budget deficits are not a short-term byproduct of the recession. Rather, deficits are due to the long-term dilemma of big government which makes massive promises of public services that it simply can’t pay for. Judging from the agenda of the current Congress, this is a problem which is on the verge of exacerbation, rather than extermination.

To truly address the growing federal deficit, lawmakers must abandon past strategies for addressing economic downturn. Says Goldsmith, “We need to break out of our old patterns of thinking and break some old habits.”

First of all, federal aid for the states will not cure, but simply delay the effects of, state budgetary trouble. The stimulus bill exemplifies this point. Federal dollars provided short term relief, but will force state budgets into the red when federal aid ends. This does nothing but prolong needed change.

Secondly, deficit spending must come to an end. Peterson and Pew Foundations show in a recent report that under current conditions, the public debt could rise to 100% of GDP by just 2022. This would inevitably lead to an unprecedented fiscal crisis. Tax increases won’t solve the problem, either, but would instead stifle economic growth and place heavy burdens on Americans already struggling to make ends meet. Lawmakers must resist the urge to delay the effects of the growing deficit until sometime down the road when someone else will be in office to deal with it. The devastating effects of out-of-control government spending can be averted if elected officials take responsibility and address the problem now.

Finally, state and federal legislators and the public alike need to get serious about the financial crunch the country is facing. Short-term fixes, like hiring freezes and employee furloughs, are not enough to address the issue at hand.

Rather than continue to throw small solutions at a big problem, it is time for the United States to rethink the public sector. The reality is that government’s promises to the electorate are unsustainable in the long-run and will drive the country to ruin if left unaddressed. As Goldsmith puts it, “Like it or not, fiscal crisis is the new normal.”

Oh...and to you military pensioners out there, consider this...FDR passed The Economy Act of 1933 that cut the salaries of federal workers and reduced benefit payments to veterans (by 40%) while intending to reduce the federal deficit in the United States.  The Economy Act had little effect on either the federal deficit or the economy since spending in other areas rose so substantially that it dwarfed the cuts imposed by the Economy Act.  Of note, within a few months Congress and the President slowly and incrementally added benefits back over a period of two years.  It has happened here!