Don't let the hype and scare tactics fool you

From The Silicon Grey Beard....
http://thesilicongraybeard.blogspot.com/2013/02/sequestration-fun-facts.htm
Original info here... 
http://mercatus.org/publication/federal-spending-without-sequester-cuts 

Data from the Congressional Budget Office...

Bottom line...






This pretty much says it all....

Who Says Crime Doen't Pay

Teenagers Speaking The Truth...

Now if we could only get the politicians to speak the truth as well. If someone would not be afraid of getting up in front of the cameras in America and speak these truths, maybe...just maybe they would get the majority of votes.

You Want Budget Cuts?

Well, we all know that the White House and Congress needs to do something about the Federal budget deficits and debt. (I hope you all know the difference between debt and deficits) Anyway, let us get serious about cutting deficits and see what we have left to cut our debt. Here is a short video showing you what needs to be cut, just to balance the budget of the United States.

Cap and Balance...Will It Work?

Here is a good article I read from the Market Ticker Guy.

"Cut Cap And Balance": Scam Or Real?

 

Let's look at the proposal:

1.  Cut - We must make discretionary and mandatory spending reductions that would cut the deficit in half next year.

2.  Cap - We need statutory, enforceable caps to align federal spending with average revenues at 18% of Gross Domestic Product (GDP), with automatic spending reductions if the caps are breached.

3.  Balance - We must send to the states a Balanced Budget Amendment (BBA) with strong protections against federal tax increases and a Spending Limitation Amendment (SLA) that aligns spending with average revenues as described above.

Ok, so we go from ~$1,700 billion in deficits to $850 billion this coming fiscal year.

That's somewhere between $750 and $850 billion in spending cuts right now, depending on how you're looking at the deficit numbers (that is, if you're cheating or not.)

That will result in at least an immediate 5% hit to GDP.  Is the GOP willing and ready to accept that?  If so, let's see a statement on that, because this is the outcome of such a cut in government spending.  The reason is simple: GDP is defined as "C + I + G + (x-i)" and you're proposing to cut "G" by 5% of GDP.  Bingo.  The flow-through on that will result in an even larger decline (and economists can fight over how much that multiplier is, but it's greater than "1")

The cap does not enforce a maximum deficit size.  It therefore is defective in that the GOP can simply pass tax cut after tax cut and yank deficits back up to "stimulate", which makes the problem worse.

"Balance" fixes it, of course, but is a Constitutional Amendment and requires passage in both houses plus ratification.  It is thus not a "right now" solution.

With one modification I would support "CCB" without reservation: In year two and beyond total government debt, including public and intergovernmental, may not grow faster than GDP, with automatic spending reductions of double any violation if it does.  I would leave only one exception: In the event of Congressionally-declared war, in which case the exception would have to be voted upon and passed by a 2/3rds majority every six months.  Yes, this means that if GDP is declining debt must decline faster (that is, the government must run a surplus!)

The GOP is close on this.  Not there, but close.  Make that one change above and you're actually addressing the problem in a way that will fix it.

Incidentally, if you make that change you permanently fix the problem and avoid S&P and Moody's rating action.

Be aware, however, that such a plan, if enacted, will bring short-term economic pain, and lots of it.  You had better be prepared with a fundamental tax, "free trade" and medical system overhaul because that has to happen in short order once this goes into place as a buffer.

This plan, however, is progress compared to what we've heard from Congress and especially Obama thus far.

Debt Ceiling or Debt Escalator

Well, soon the gov will need to act or not act on the Federal debt. We are currently, as I type this, at $14.25 Trillion with a debt limit (ceiling) of $14.3 Trillion. What does that mean? Well it means that the CONgress critters will need to decide on what to do. Spend more or seriously cut back. Now really, do you think that the Washington politicians can put a stop to their spending binge? I don't. They have not been able to in the past and they cannot now. Their reason will be that they cannot limit the debt or we will default on the debt or our economy will collapse. I hate to tell them, but our economy is collapsing, just slowly. We will see QE 3 probably by July, even though QE 1 and QE 2 have done nothing.

Remember the blog where I described debt and deficit? Well we are seeing both parties offering up plans to reduce our deficit by $4-5 Trillion over the next 10 years. Gosh, to most sheeple that sounds pretty good. I mean, we have a $14 trillion debt and we have a chance to reduce it by $4-5 Trillion, sounds good doesn't it? The problem is that they are talking about reducing the DEFICIT not the DEBT!!!! We currently have a predicted deficit for this year of about $1.65 Trillion. Let us look closer. $4-5 Trillion over 10 years means $400-500 Billion per year. If you keep running the same deficit as we are expected to have this year, which will likely climb, we would then subtract $500 Billion from $1.6 Trillion. This would still leave us a deficit of $1.1 Trillion! So over the next 10 years that our fabulous politicians are reducing our deficit we will be adding another $11 Trillion to our debt. By 2021 we could see a debt of $25 Trillion.

In 2010 we paid $413 Billion just in interest. Just since October 2010 until now we have paid $215 Billion in interest. At this pace we will pay $430 Billion in 2011. This is just interest payments. What do you think we will have to pay in 10 years if we have a debt of $25 Trillion? Some say the interest payments on the debt at $25 Trillion will be $1 Trillion!!

What is the solution? Well the politicians are saying we need to raise taxes on the rich. Again, that sounds good to the sheeple. I mean, the rich can afford it, right? Well, if I'm not mistaken it is usually "the rich" that start businesses, employ people and buy goods that keep other businesses in business.

Look at this Wall Street Journal article.
The Internal Revenue Service's income tax statistics for 2008, the latest year for which data are available. The top 1% of taxpayers—those with salaries, dividends and capital gains roughly above about $380,000—paid 38% of taxes. But assume that tax policy confiscated all the taxable income of all the "millionaires and billionaires" Mr. Obama singled out. That yields merely about $938 billion, which is sand on the beach amid the $4 trillion White House budget, a $1.65 trillion deficit, and spending at 25% as a share of the economy, a post-World War II record.

Say we take it up to the top 10%, or everyone with income over $114,000, including joint filers. That's five times Mr. Obama's 2% promise. The IRS data are broken down at $100,000, yet taxing all income above that level throws up only $3.4 trillion.

The Obama administration's spending request contains $2.627 trillion in receipts and $3.729 trillion in outlays for 2012.^[6] The Republican plan contains $2.533 trillion in revenues and $3.529 trillion in outlays. Neither keeps us from adding debt.

This shows me that we cannot tax our way out of this mess. We have to make some serious cuts in spending. THIS WILL BE PAINFUL FOR ALL OF US!!! But it need to be done. Our government needs to spend what they take in. They need to stop discretionary spending, reduce social handouts, revise Medicare and Medicaid and repeal Obama Care. It won't be easy, but the pain will be worse if we put it off.

People I have been telling you to prepare for some time. Well, time is running out, get to it.

Social Security In The Red

It wasn't supposed to happen this soon. In 2010 the Social Security Trust Fund went in to the red, but it was expected to return to the black until 2016. It is now being reported that it will stay in the red and will go bankrupt by 2037. This year alone, it is expected to run a $45 billion deficit.

Don't count on Social Security to be there when you need it.