Why do Democrats live far beyond their means?

Republicans typically enjoy massive support from people who actually know how the world works, namely, small business owners, investors and entrepreneurs. But do Barack Obama and his new Supreme Court nominee know how the world works?

Sonia Sotomayor

Let’s look at Obama’s Supreme Court nominee first.

Here is what she says:

I would hope that a wise Latina woman with the richness of her experience would more often than not reach a better conclusion than a white male who hasn’t lived that life.

So she discriminates against people based on sex and race. There are words for people who discriminate against others based on sex and race.

The American Thinker reports on how she lives within her means: (H/T Commenter ECM)

Sotomayor’s annual earnings come to $196,000 a year ($170,000 a year as an appeals judge and $26,000 for part-time teaching). She has served as an appeals judge for 17 years. This service was preceded by lengthy tenure at a corporate law firm of Pavia and Harcourt, where she was a partner, and presumably was well compensated.

Yet after a career that has spanned 25 years, Ms Sotomayor only has one thousand dollars in net savings. As reported in the New York Post, Sotomayor’s bank account holds $31,985. Her credit cards debts are $15,823, and she has $15,000 in unpaid dental bills. That leaves her with $1,162. Sotomayor’s total assets, revealed as $708,068, consist almost entirely of equity in her Manhattan apartment.

And here is what it means for us:

If confirmed as a Supreme Court justice, Ms Sotomayor will be ruling on numerous cases that involve investors, savers, corporate profits, business regulation, and related free-market issues…. the fact that Ms Sotomayor, after so many years of highly paid professional work, has no savings or investments and no experience or apparent “empathy” with savers or investors, should be highly troubling to the tens of millions of Americans who do have investments, 401Ks, and personal savings.

And here is how this has affected her previous rulings:

In one of her most important rulings (as reported in the New York Times), Sotomayor ruled that corporations must address environmental concerns in the most radical manner without consideration of the cost. If one particle of pollutant remains to be removed, even at the cost of bankrupting all of the companies in the S&P 500 index, that particle must be removed. If a small business has failed to purchase the most advanced equipment available to address environmental concerns, even if the price of that equipment is one hundred times the revenue of the business in question, the equipment must be purchased. That is how much “empathy” we can expect from Judge Sotomayor.

If she is confirmed, she will probably hurt our free market capitalist system, and the liberties grounded by it. The more that the court hurts business and commerce with judicial activism, the more we lose our jobs, our incomes and our liberty itself.

Barack Obama

Now, let’s take a look at how Obama lives. First of all, it’s well known that Obama was raised with a silver spoon in his mouth and went to all the best private schools, where he snorted expensive cocaine. And he awarded massive taxpayer grants to the hospital where his wife worked after her salary was nearly tripled.

The National Review reports:

One of Obama’s Earmark Requests Was for the Hospital That Employs Michelle Obama.

Dan Riehl notes, via Amanda Carpenter, that in the list of earmarks he requested, $1 million was requested for the construction of a new hospital pavilion at the University Of Chicago. The request was put in in 2006.

You know who works for the University of Chicago Hospital?

Michelle Obama. She’s vice president of community affairs.

As Byron noted, “In 2006, the Chicago Tribune reported that Mrs. Obama’s compensation at the University of Chicago Hospital, where she is a vice president for community affairs, jumped from $121,910 in 2004, just before her husband was elected to the Senate, to $316,962 in 2005, just after he took office.”

The NY Daily News reports on how well the Obamas live within their means. (H/T Sweetness and Light)

A close examination of their finances shows that the Obamas were living off lines of credit along with other income for several years until 2005, when Obama’s book royalties came through and Michelle received her 260% pay raise at the University of Chicago. This was also the year Obama started serving in the U.S. Senate.

In April 1999, they purchased a Chicago condo and obtained a mortgage for $159,250. In May 1999, they took out a line of credit for $20,750. Then, in 2002, they refinanced the condo with a $210,000 mortgage, which means they took out about $50,000 in equity. Finally, in 2004, they took out another line of credit for $100,000 on top of the mortgage.

Tax returns for 2004 reveal $14,395 in mortgage deductions. If we assume an effective interest rate of 6%, then they owed about $240,000 on a home they purchased for about $159,250.

This means they spent perhaps $80,000 beyond their income from 1999 to 2004.

The Obama family apparently had little or no savings during this period since there was virtually no taxable interest shown on their tax returns.

These numbers clearly show the Obamas were living beyond their means and they might have suffered financially during the decline in housing prices had they relied on taking ever larger amounts of equity from their home to pay the bills.

And what did the Obamas learn from this?

But in 2005, Obama’s book sales soared and the royalties poured in. Michelle explained, “It was like Jack and his magic beans.”

Without those magic beans, the Obama family would have eventually suffered the consequences of too much debt.

President Obama has never faced consequences in his private life when it comes to managing money. He always had enough money simply by borrowing more and more. And just when things got tight, those magic beans came along to save the day.

I guess this explains Barack Obama’s fiscal policy and his surprise at the consequent surge in unemployment. But he can count on his new judge to back him to the hilt in all of his unconstitutional interventions in the free market – neither of them knows the slightest thing about saving and investing… just borrowing and spending.

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