Tag Archives: Depression

News

Democrats kill Michele Bachmann’s attempt to freeze federal salaries

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Here’s her own words from her YouTube channel:

After a series of procedures on the Floor of the House, House Democrats voted to table a bill that would eliminate the proposed federal employee pay raise scheduled to go into effect next year and also freeze the pay for Members of Congress. Rather than cut spending as the people have asked, Democrats have passed the buck yet again.

And here’s the video.

I’m guessing that this is the spending cut that was selected by the public as part of the Republicans’ “YouCut” program, which allows ordinary voters to choose which legislation will be brought forward by the Republicans to cut federal spending. I posted a video of Michele earlier this week explaining which cut was selected by voters. I guess she got picked to bring the proposed cut up for a vote. Well, the Democrats blocked her and now federal employees, including members of Congress, are all going to get raises. During a recession headed for a depression.

Here’s the blurb from a second video she posted:

It’s amazing to me that the Democrats here in Washington can say that they are seriously concerned with our skyrocketing debt and out of control spending, yet reject the people’s common-sense proposal to put a freeze on federal salaries, including Members of Congress. The Democrats can’t have it both ways, and it’s just another example of the fiscal recklessness we’ve grown so accustomed to under their leadership.

And here’s the second video:

This made me feel very sad. Why isn’t anyone listening to her? How is anyone supposed to have children when they know that the next generation of kids is going to be saddled with enormous debt from our overspending?

By the way, I note that Club for Growth now has Michele ranked #1 in their legislative power rankings. And I agree, she is the best. Ryan is #3, and Blackburn is #5. In the Senate rankings, Jim Demint is all alone at the top.

News

US money supply contracting at Great Depression levels

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The most-read story today on the UK Telegraph. (H/T ECM)

Excerpt:

The M3 money supply in the United States is contracting at an accelerating rate that now matches the average decline seen from 1929 to 1933, despite near zero interest rates and the biggest fiscal blitz in history.

The M3 figures – which include broad range of bank accounts and are tracked by British and European monetarists for warning signals about the direction of the US economy a year or so in advance – began shrinking last summer. The pace has since quickened.

The stock of money fell from $14.2 trillion to $13.9 trillion in the three months to April, amounting to an annual rate of contraction of 9.6%. The assets of insitutional money market funds fell at a 37% rate, the sharpest drop ever.

“It’s frightening,” said Professor Tim Congdon from International Monetary Research. “The plunge in M3 has no precedent since the Great Depression. The dominant reason for this is that regulators across the world are pressing banks to raise capital asset ratios and to shrink their risk assets. This is why the US is not recovering properly,” he said.

What should we expect from a man who opposes capitalism? Well, we should expect to be poor. We should expect to be as poor as people were during the Great Depression.

I have an idea. Next time, let’s elect someone who is responsible enough to have his own credit card.

News

Did Obamacare really provide a tax cut for small businesses?

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Check out this AP article. (H/T Michele Bachmann)

Excerpt:

When the administration unveiled the small business tax credit earlier this week, officials touted its “broad eligibility” for companies with fewer than 25 workers and average annual wages under $50,000 that provide health coverage.

[…]Lost in the fine print: The credit drops off sharply once a company gets above 10 workers and $25,000 average annual wages.

[…]Consider small businesses: “The idea here is to target the credits to a relatively low number of firms, those who are low-wage and really quite small,” said economist Linda Blumberg of the Urban Institute public policy center.

On paper, the credit seems to be available to companies with fewer than 25 workers and average wages of $50,000. But in practice, a complicated formula that combines the two numbers works against companies that have more than 10 workers and $25,000 in average wages, Blumberg said.

“You can get zero even if you are not hitting the max on both pieces,” Blumberg said.

[…]Hoffman, the furniture store owner whose business missed out on the credit, says he understands that lawmakers writing the health care legislation had a limited amount of money to work with. But his company’s premiums rose 15 percent this year, and it’s a struggle to keep paying.

To get the most out of the new federal credit, Hoffman said he’d have to cut his work force to 10 employees and slash their wages.

“That seems like a strange outcome, given we’ve got 10 percent unemployment,” he said.

So, the government is actually paying businesses to NOT HIRE EMPLOYEES and to NOT RAISE SALARIES. That’s the only way small businesses can get the tax credit.

Michele writes:

Unfortunately, this bill will only discourage small businesses from raising wages and/or hiring more employees.  The business owners and employers in Minnesota I’ve met with all have said one thing: the uncertainty of the newly passed Health Care bill is keeping them from hiring and expanding.

Businesses are run by people who put their own skin in the game by risking capital to try to make a profit. That capital is often borrowed from family, friends or banks. And when business owners see that government is passing laws that take away the decision making power of the business owner and give it to government bureaucrats with no skin in the game, business owners get frightened – they are taking all the risks but the government is making the decisions. And government isn’t as good at making decisions for a business to avoid losses as the business owner is.

So even though Obama spends trillions of dollars, bankrupting the next generation of taxpayers, it can still be the case that unemployment increases. He’s killing the economy with his meddling – just the same way as interventionists like Hoover and FDR did during the Great Depression. When business owners see that the rules are changing under them because of state intervention into the economy, they just don’t have the confidence needed to expand their businesses, hire employees, or raise salaries.

And don’t forget that the money for the “tax credit” is being taken from your children, who will eventually have to pay for all of Obama’s spending.