Category Archives: News

Judd Gregg says Obama’s budget will bankrupt the country

UPDATE: Welcome visitors from Free Canuckistan! Thanks for the linky, Binky!

Found this post over at Gateway Pundit. You’ll remember that Judd Gregg is one of those fiscally conservative New Hampshire senators, an expert on business, finance and economics. Despite being a Republican, he was nominated by Obama for the Cabinet position of Commerce Secretary. He backed out of it, though. And now we can guess why.

Last month, he warned that the budget would bankrupt the USA:

A new video from CNN is here. Here’s an excerpt from the transcript:

“The practical implications of this is bankruptcy for the United States,” Gregg said of the Obama’s administration’s recently released budget blueprint. “There’s no other way around it. If we maintain the proposals that are in this budget over the ten-year period that this budget covers, this country will go bankrupt. People will not buy our debt, our dollar will become devalued. It is a very severe situation.”

“Your listeners have to understand how staggering the numbers are. We’re talking about a deficit in the trillion-dollar range for as far as the eye can see. We’re talking about deficits which are 4% to 5% of GDP – which is not sustainable under any form of government. We’re talking about a public debt – this is a debt that people own of the federal government – that will be around 80% of GDP. Historically, it’s been around 40% of GDP in the out years. The practical implication of this is bankruptcy for the United States. There’s no other way around it.”

I know people who denounced Bush, McCain and Palin. They voted for this ACORN lawyer. As if Obama was God’s gift to small government conservatism. They wouldn’t read a single economics book. I remember showing them numbers from Citizens Against Government Waste and American Taxpayers Union, which they rejected.

Here’s one more interesting piece from the always wonderful IBD (editorial, podcast). I include the details of the Bush and Reagan budgets, for comparison with Obama’s budget.

Excerpt:

According to the CBO, the Obama administration lowballed its deficit forecast by $482 billion over the next four years and $2.3 trillion over the next 10. In other words, the CBO says that 10-year deficits will be 33% higher than the president claims, should his plans get enacted.

This makes Obama’s budget one of the worst accounting jobs ever put forward in modern times by a new administration.

When the CBO reviewed George W. Bush’s first budget, for example, the difference between what Bush said his budget would cost and what the CBO said it would cost was minimal.

…Reagan’s first budget, which was widely panned for allegedly employing rosy scenarios to cook the numbers, differed from the CBO by just 1.2% in projected revenues and 5% in spending over the first four years.

So why the huge gap between Obama and the CBO?

Obama’s team employed one of the oldest budget tricks in the books — exaggerating economic growth — to hide the true cost of his tax and spending plans. Budget forecasts are hugely sensitive to predictions about GDP growth, inflation, unemployment and interest rates. Even slight differences can have a huge impact on projected outlays and revenues.

And in his budget, Obama is positively Pollyannaish about the economy, predicting 3.2% real GDP growth next year, compared to the CBO’s 2.9% and the Blue Chip consensus forecast of 1.9%. While the CBO and Blue Chip think unemployment will be 9% in 2010, Obama claims it will be only 7.9%. And so on.

Here’s an image I stole from IBD:

IBD: Publically-held debt
IBD: Publically-held debt

Read the whole editorial! And don’t foget to subscribe to IBD’s podcast feed. It’s FREE!

Michelle Malkin has more details on Obama’s “public-private partnership” plan for economic recovery.

Excerpt:

Full video and slides from the Heartland Institute GW conference

I first heard about this global warming conference on John Lott’s blog here. But at least I’ll be able to go through the slides and video of the presenters, because it’s all online here.

I was excited to see the Czech Republic President (and current European Union President) Vaclav Klaus in there as a keynote. And I see some other names I recognize, like Richard Lindzen of MIT who also gave a keynote address. I see Tom McClintock gave a keynote. He’s a solid conservative who ran against Arnold in the California gubernatorial race, after Gray Davis was dumped.

The only other people I recognize are Sen. John Sununu, Fred Singer and Roy Spencer. And Iain Murray, whose book I still have to buy.

Here’s something by Iain Murray in the Competitive Enterprise Institute’s Open Market blog that’s relevant. The UN wants to impose a tax on wealthy nations to raise 750 billion dollars to stop ManBearPig global warming.

Achim Steiner, head of the UN Environment Program, has said that the global financial crisis provides an opportunity for a global green new deal.

Murray quotes Steiner in this Reuters article, on how he proposes to get the money:

“If, for argument’s sake, you were to put a five-year levy in OECD countries of $5 a barrel, you would generate $100 billion per annum. It translates into roughly 3 cents per liter,” he said.

“It would be almost, if not totally, unnoticed by the consumer”…

Remember a little while back, Sen. James Inhofe tried to stop UN global taxes? I don’t know if this counts as one, but it sounds like one to me!

Why fiscal conservatives should care about marriage

UPDATE: Welcome visitors from Free Canuckistan! Thanks for the linky, Binky!

The percentage of out-of-wedlock births is now 40% of all births. Does this have an effect on the size of government? FOX News has a story on the breakdown of the nuclear family. (H/T Institute for Marriage and Public Policy)

Excerpt:

…births to unwed mothers reached an all-time high of about 40 percent, continuing a trend that started years ago. More than three-quarters of these women were 20 or older.

For a variety of reasons, it’s become more acceptable for women to have babies without a husband, said Duke University’s S. Philip Morgan, a leading fertility researcher.

…And more women – especially those in their 30s and 40s – are choosing to have children despite their single status.

For some reason, and I know what that reason is, society has decided that men are unnecessary to the task of raising children. A man’s job is just to supply sperm and money. And that money is taxed away from men by the government and redistributed, via expensive social programs, to unwed mothers. And this is how the state takes over the traditional role of men as protector and provider.

The House Ways and Means Committee knows about the effect of raising children without fathers.

US House Testimony on Child support and Fatherhood proposals (Hearing 107-38).  June 28, 2001, online House version; http://waysandmeans.house.gov/legacy.asp?file=legacy/humres/107cong/6-28-01/record/chillegalfound.htm) — Father absence, a byproduct of divorce, illegitimacy, and the erosion of the traditional family, is responsible for; filling our prisons, causing psychological problems, suicide, psychosis, gang activity, rape, physical and sexual child abuse, violence against women, general violence, alcohol and drug abuse, poverty, lower academic achievement, school drop-outs, relationship instability, gender identity confusion, runaways, homelessness, cigarette smoking, and any number of corrosive social disorders.

So then why does the government continue to subsidize out-of-wedlock birth? When you subsidize something, you get more of it. When you tax something, you get less of it. Is this so hard for social progressives to understand? Too much compassion, without standards, costs society in the long run, (see Jewish scholar Dennis Prager’s piece here).

More statistics on the cost of fatherlessness here at Fathers for Life..

CBO: Budget adds 4.8 trillion to national debt, China worried

Hot Air has this:

In a new report that provides the first independent analysis of President Obama’s budget request, the nonpartisan Congressional Budget Office predicted that the administration’s agenda would generate deficits averaging nearly $1 trillion a year over the next decade$2.3 trillion more than the president predicted when he unveiled his spending plan just one month ago.

Tax hikes are mentioned here at the Competitive Enterprise Institute’s Open Market blog:

Obama’s budget would explode the national debt while increasing taxes. That’s the conclusion of the Congressional Budget Office, controlled by lawmakers who support Obama. “The President’s proposals would add $4.8 trillion to the national debt,” increasing “the cumulative deficit from 2010 to 2019 to $9.3 trillion.” The budget also adds $1.9 trillion in tax increases.

And the stimulus bill Obama claimed was needed to avert “disaster” and “irreversible decline“? It will shrink the economy over the long run, since its “increase in government debt is expected to displace or ‘crowd out’ . . . private capital.”

…The CBO’s conclusion confirms its earlier findings that the stimulus package will cut wages and the size of the economy in the long run, despite costing $800 billion. The stimulus package also gutted welfare reform.

The Heritage Foundation blog The Foundry has more. Here are just a few of their bullet points:

• He raises taxes not just on upper-income taxpayers as he promised, but on all Americans through his misnamed “climate revenues”, and as his budget indicates, this is just a starter program.

• The President calls for enormous increases in government spending on health care and climate change, but on a great many other programs.

• The CBO saw through perhaps the greatest chicanery ever in federal budgeting when President Obama first assumed the full costs of the operations in Iraq and Afghanistan in perpetuity, and then claimed he is cutting spending when he asserts a change in policy and those spending amounts disappear.

The more he spends, the more it looks like he’s going to have to print money to get out of this, or raise taxes on producers and destroy the economy completely. And all that makes China very, very worried. Here is an article from the leftist New York Times, headlined “China’s Leader Says He Is ‘Worried’ Over U.S. Treasuries”.

Excerpt:

The Chinese premier Wen Jiabao expressed concern on Friday about the safety of China’s $1 trillion investment in American government debt, the world’s largest such holding, and urged the Obama administration to provide assurances that its investment would keep its value in the face of a global financial crisis.

…Mr. Wen said he was “worried” about China’s holdings of Treasury bonds and other debt, and that China was watching United States economic developments closely.

If Obama prints more money, this would raise inflation and devalue the US currency, including the Treasury Bonds held by China.

But economists have cited several possible threats, led by the prospect that the dollar’s value will depreciate over time, lowering the value of China’s holdings.

“In the short run, the dollar is appreciating” because global investors see the American currency as a safe haven at a time of crisis, Bai Chong-En, who heads the economics department at Tsinghua University in Beijing, said in a telephone interview. “But we don’t know what’s going to happen in the long run. If the American stimulus package is financed mainly by borrowing, then that may affect the future value of Treasury securities.”

Some specialists also say that high inflation could erode the dollar’s value. Finally, some believe that China’s investment in American debt is now so vast that, should it need foreign exchange in some emergency, it would be unable to sell its Treasury securities without flooding the market and driving down their price.

“The only possibility, really, is that China will have to hold these bonds until maturity,” said Shen Minggao, the chief economist at Caijing, a Beijing-based business magazine. “If you start to sell those bonds, the market may collapse.

And Heritage Foundation is reporting that they are even talking about switching out of the US dollar as their reserve currency.

Sigh. I found an article by Victor Davis Hanson (H/T Stop the ACLU) where he explores why Obama is destroying the economy. He has three possible solutions, and he analyzes each of them.

  1. Clueless
  2. Not so clueless
  3. A mean streak

Personally, I vote for 1). And that goes for anyone voted for him. And I’ve read David Freddoso’s book, so that’s where I am coming from. But you can read the VDH article and make up your own mind.