October 16, 2013-Groundhog Day in Washington, D.C.

by Richard H. Frank

The politicians in Washington D.C., especially Barack Obama, Harry Reid and Nancy Pelosi, are marking October 16, 2013 as a victory over Republicans in the House of Representatives with the passage of an extension to the CR and the debt limit extension until after the first of the year. In reality, the Senate Bill accomplished absolutely nothing and was a replay of the 2011 budget crisis. Just as in the movie “Groundhog Day” every American can prepare for a replay of the same old “crap” – just another day.

The only accomplishment of this legislation is to incur an additional $1 trillion of debt over the next 60 days for Obama to spend and redistribute as he deems appropriate.

I seem to remember his statements and vote against the debt limit increase in 2006 as such actions would be irresponsible and un-American. Now he has the audacity to proclaim that extending the debt limit does not increase our debt by a single dime. I wonder where he studied money and banking. Obviously not in the Wharton School of Economics. I also seem to remember he appointed the Simpson Bowles Commission to study and make recommendations on how to bring Government spending under control and eventually balance the Federal budget.

Because the Commission recommendations addressed entitlement reform, Obama immediately rejected the recommendations out of hand and for the past four years has ignored his own Commission’s findings.

Following the loss of control in the House by Democrats in the 2010 mid-term election, Obama’s solution to our economic woes was to appoint a Super Committee charged with solving the ongoing problems of continuing deficits and structuring a “grand bargain” that would raise revenues without reducing the current out of control spending.

To assure success of the Super Committee, Obama and his administration championed the creation of the “Budget Control Act” passed and signed into law in 2011 that contained a provision for across the board spending cuts in every branch of government known as the “Sequester.” When the Super Committee failed to reach agreement and eventually disbanded, Obama and his administration freaked out as sequester took over and they predicted Armageddon for the nation. Two years have passed and the spending reductions have been implemented without Armageddon taking place.

The government shutdown of 2013 began on October 1, 2013 with the furlough of some 700,000 non-essential government employees. If my math and understanding of the English language is correct, that means approximately one-third of the Federal Government is non-essential; then it seems to reason that one-third of the Federal budget should be scrutinized for elimination.

One-third of our current spending in a $3.2 trillion budget equates to $1 trillion in reductions that brings the Federal budget close to balancing. However, Congress would never consider addressing the obvious as some special interest might be put at risk when logic prevails over politics.

The real answer to the Government’s spending problem is to rid Congress of the professional politicians through strict term limits that would rid the Government of those who put personal advancement over doing the work and will of “We the People.”

Unfortunately, this would require that someone sponsor a Constitutional Amendment to achieve that end. This, along with a Balanced Budget Amendment, although talked about, are much like the mythical unicorn – beautiful to imagine but far from reality.

So following October 16, 2013, another groundhog day, our nation is taking a giant step along the path to becoming Greece.

May God have mercy on our children and grandchildren who are destined to bear the burden of debt thrust upon them by a Federal bureaucracy concerned only with their ideology and egos.

Should we fail to fundamentally alter the makeup of Congress in the 2014 mid-term and put a stop to the devastating regulation of our economy and redistribution ideology held by Barack Obama and his minions, he will have achieved his stated goal to “fundamentally change America” to become a European-style democracy and cease as a Representative Republic.

The Politics of the Destruction of America

by: Richard H. Frank

The latest crisis created by the Washington, D.C.  elites is the impending default on the National Debt, which according to the Obama Administration would put the world’s financial system into irreversible  collapse.  Having  reached the existing debt limit of $14.3 trillion established by Congress, Barack Obama has resorted to the fallback tactic of “fear” to frighten seniors and military personnel in hopes they will call upon their representatives to increase the debt limit by $2.5 trillion.

Barack Obama’s statement that he could not guarantee payments to Social Security recipients and military personnel is ridiculous and Congress should call his bluff by drafting legislation that forces prioritizing payments for interest on the national debt first followed by the military and Social Security in this order with all other program priorities established in order of importance by the Department of the Treasury.

Passage of such legislation in the House of Representatives will insure the  nation’s priorities are established and assure the full faith and credit of the nation.  If  either the Senate or the President refuses to pass and sign this legislation, the public will become acutely aware of where the political priorities of the Administration may be found.

To quote Paul Ryan “We don’t have a revenue problem, we have a spending problem!”  Barack Obama states that he will support a “big picture” program that cuts $4 trillion from spending over the next 10 years while increasing taxes on the rich.  The rich are those Americans earning $200,000 annually.  His proposal has no specifics as to what programs will be cut to avert the crisis but insists Congress must increase the debt limit by $2.5 trillion now so he can save $4 trillion over the next 10 years.  Where are the savings (spending cuts) to come from Mr. President?

The House of Representatives has identified $2.5 trillion in cost cuts over 10 years.

Consider a sampling of 55 programs and question why they are included in the budget in the first place.

  • Eliminate duplicate education programs.  HR 2274 removes 68 at a savings of $1.3 billion annually.
  • Amtrak subsidies $1.6 billion  annually.
  • National Endowments for The Arts – $167.5 million annually, and Humanities $1.675 million annually.
  • Corporation for Public Broadcasting subsidies $445 million annually
  • Legal  Services corporation $420 million annually
  • Community Development Fund $4.5 billion annually
  • Federal Travel Budget – Cut by 1/2  – $7.5 billion annually
  • Department of Energy Grants to States – $530 million annually.
  • Title Xx Family Planning – $318 million annually.
  • Federal Office Space Acquisition – $864 million annually.
  • Repeal of the David-Bacon Act – $1 billion annually.
  • Repeal of Obamacare – $1.0 billion annually

Elimination of Government wasteful spending in itself could eliminate the need to extend the Nation’s debt limit.  Instead of forcing the President to cut spending, Senate Mitch McConnell is suggesting that Congress support increasing the limit by $2.5 trillion through the 2012 elections.  This action in essence is unconstitutional and gives that authority(the power of the purse) to the Executive  Branch, instead of Congress, and to his Majesty Barack Obama.

The President is using the budget and debt limit crisis as his ticket to re-election and furthering the transition fo America from a democratic Representative Republic  to a European Socialist style democracy.  The artificial deadlines set by Obama are a mythical drop-dead date made to make him appear as in control of a situation which he has no conception of how to solve.

Congress must stand firm and accept no increase in the debt limit without substantial cost cutting to specific programs coupled with a Balanced Budget Amendment, and no increases in taxes; anything short of these major  reforms will ultimately lead to the Destruction of America.

Why the Proposed VAT will not Reduce the Deficit

by Richard H. Frank

When I was just a boy growing up in what then was considered to be a middle class family, and had received a birthday or Christmas gift in the form of one or two dollars, I could hardly wait to spend that money.  My parents used to say “the money was burning a hole in my pocket.” It mattered little what I spent the money on as the mentality in my youth was “I had the dollar, I must spend it!”

The difference between the 111th Congress today and me in my youth is that when my dollar was gone, I could spend or get no more. Congress, however, has no such constraint on their spending limits; hence we have a national debt approaching $14 trillion, a burden to be paid by those yet unborn.  Our brilliant legislators know that the American people are adverse to increased taxes on income, property and capital gains, so they are now considering the imposition of a Value Added Tax that will impact the finances of every American.  This national sales tax applied to goods and services at each step in the manufacturing or delivery process is largely hidden from the consumer except in what appears as inflationary costs paid for that good or service.

Those in Congress and the Obama Administration will attempt to sell Americans on the idea for this tax in addition to all other taxes we pay, as being needed to eliminate the national debt. The problem is that all their hollow promises such as the Social Security lock box and trust funds specifically designed to cover some defined purpose, are routinely raided by Congress to pay for their uncontrolled spending.

Congress, like me as a boy, cannot control their urge to spend.  Whenever there exists a surplus, real or in some imagined forecast; i.e., CBO estimates, they cannot resist the urge to spend.  If no real need exists, leave it to Congress or the Administration in power to create the need through some perceived crisis.

The Obama Administration beats its chest as it demonizes big business, wall street and our financial system as requiring new tighter controls.  Well, what about our Federal Government?  I don’t see anyone  in the Administration demanding controls on Government spending.  Perhaps now is the time for a Constitutional Amendment holding our Government responsible for passing a balanced budget, not through taxation, but through constraints on spending.

Our Constitution in Article I, Section 8, is specific in defining the limits placed on Congress for spending.  The  congress has abused the Commerce and General Welfare clauses of this document to a point where there are no limits on what they can appropriate and exercise control over the free market.  A Balanced Budget Amendment may be the only salvation to placing a limit on their mania to spend and return this nation to financial stability and security.