Tag Archives: National Debt

News

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

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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.

Commentary

Obama’s first 50 days: worst president ever

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Oh, there’s no doubt that he’s the worst president ever. Gateway Pundit has the re-cap, in point form.

Excerpt:

** He’s lost at least 3 administration nominees due to tax fraud.

** He’s promoted a tax cheat to run the IRS and Treasury.

** The Dow has dropped faster under Obama than any other new president in 90 years.

** Obama’s budget more than doubles the national debt held by the public, and adds more to the debt than all previous presidents — from George Washington to George W. Bush — combined.

** Obama managed to spend more than the wars in Iraq and Afghanistan combined.

** Obama will quadruple the deficit this year.

** Cap & trade was introduced that will cost America 4 million jobs and cost Americans at least $700 per family per year.

That’s just about some of the spending and the socialism. Click here to see more about his energy policy, foreign policy, social policy, trade policy. We’re doomed. We’ve elected an unqualified socialist who does not understand anything about how the world works, on any level.

Also, Gateway Pundit reports here that Obama wants to sign a trade deal with communist Cuba after rejecting a trade deal with our capitalist, pro-American ally Colombia recently. Meanwhile, Canada has a free trade deal signed with Colombia already.

Videos

Bobby Jindal defends Rush Limbaugh against hostile Larry King

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Hot Air has the video of Jindal kicking butt on Larry King Live. It’s more fun to watch when the left is angry and crazy.

Here’s Hot Air’s blurb about the video:

Bobby Jindal faced off against an unusually hostile Larry King last night over the Steele-Limbaugh contretemps. King kept trying to stuff words into Jindal’s mouth, and Jindal politely but firmly kept spitting them back at King.  King insists that Republicans want the country to fail when it’s clear that not even Rush says that.

CNN has the full transcript! Here’s the best part:

KING: Governor, do you think people are thinking about capitalism now or are they thinking about problems?

JINDAL: Look, clearly, the American people are worried about paying their mortgages, keeping their jobs and paying their health care bills. I think Rush is a great leader for conservatives. I think he articulates what a lot of people are concerned about. And I think it is absolutely true that you can help people keep their jobs, help people afford their health care, help people afford their homes without abandoning the same conservative principles.  For example, Republicans offered ideas like aggressive tax credits to make homes more affordable so people can refinance, can stay in their homes. You’d see more demand for homes. They’ve offered ideas about — instead of nationalizing banks, why not modify the mark to market rules? …

KING: Do you want him to fail?

JINDAL: I want the — I don’t want those policies to be adopted. I want my country to succeed, but I don’t want policies to be adopted that I think –

KING: But what if the… policies actually work?  What if they work?

JINDAL: This is where we have a fundamental disagreement. I don’t think it’s going work to borrow half a — to spend in excess of our revenues.  If you believed everything that the president — if you believed all of his projections, if you believe the economy starts growing again, you believe that we’re not going be spending all that money fighting overseas…if you believe that all of these temporary programs are truly temporary, he’s still projecting deficits of half a trillion dollars per year, under the best case scenario.  Larry, that’s just not sustainable. We cannot continue to do this as a country. China cannot become — continue to be our largest foreign holders of debt. This addiction to debt is what’s caused so many of our problems. The government is not going to be the answer to every problem.  I want my country to succeed. But what I worry about is that simply spending money on new programs — look at every new bailout. You know, you talked today, you know, about the auto bailouts. Then you had the fourth, I think it’s the fourth — it’s hard to keep track — the AIG bailout today. It seems like every time you turn around, there’s another trillion dollar trillion plan. … I’ve yet to hear a coherent exit plan.

KING: So you hope — you hope it doesn’t hurt?

JINDAL: No. I hope that failed policies don’t get adopted. I want my country to succeed. I want the economy to grow. I want — certainly I want the economy to grow again so people can afford their homes.  But I don’t want the Congress to adopt policies that would make the problem worse, not better. … I think it’s our — I think it’s our obligation as Americans when we don’t agree with a policy to speak up against it and to certainly offer different solutions.