And The Fallout Begins…

August 7, 2011

This week in American econo-political history was significant for 3 reasons.

1)  The bailout deal actually coalesced.  The US did NOT default on any of its loans as Congress actually compromised and raised the debt ceiling.
2)  The Dow saw a 513 point drop as a general reaction to weeks of crappy economic news being ignored (see #1) and everyone realizing that the contagion has spread to Europe and its in Spain AND Italy.

3)  S&P downgraded US debt to AA+ status.  For the first time in history, one of the major ratings agencies has downgraded US debt.

With all that said, it all boils down to this.  #1 shows that politics and brinksmanship is more important than actually doing what is best for the country.  Everyone knows that the amount cut wasn’t nearly large enough and that you’re going to have to raise taxes to get the fiscal house in order – the whole is just too big.  Congress kicked the can down the road to buy time for the ‘super-Congress’ to try its hand.  Don’t hold your breath.  They didn’t address the underlying problems in entitlements now….they probably won’t do it then.  I applaud House Republicans for sticking to their guns, however pledges to Grover Norquist should not take priority of the oath you took to the country and your constituents.  Please realize that major corporations do not pay their fair share in taxes and that it is a fallacy to say that increasing taxes is a defacto job killer – the primary decision to hire employees is not based upon taxes you pay but ability to expand business and make more money in the market.

#2 Shows that we are not out of the woods.  This isn’t a muddle-through economy.  I believe this is an economy in recession that got a reprieve due to gov’t stimulus.  that stimulus has about run out at this point, so we will slip back into recession  The underlying problems in housing, banking, and the false economic expansion of the 2000’s due to those industries are still with us.  Until we address them and continue the deleveraging process, the economy will not recover.   Taking your eye off of the ball for months because of a distracting debt debate gives you a 513 single day decline because of these continuing underlying problems.

#3  The only AAA this country has left are surface to air missiles and the road-side assistance people.  We spend more than we make, we owe huge amounts of money to others, and we have no real plan of fixing things.  Pile a generally pathetic exercise in leadership from the politicians in DC and you get the crisis we’re in.

I recognize that its tough.  I see the merit in specific types of stimulus to help jump-start the economy.  The problem is, we didn’t do the right ones, everyone knew it, and now, there is rightly no appetite because the public doesn’t trust the federal government to spend that kind of money wisely.  They had their chance to enact good stimulus – i.e. really rebuild America’s infrastructure, or develop next generation energy sources.  Both would be long-term investments where your return was larger than the investment and created real jobs here at home.  Instead, they propped up failing institutions, bailed out banks and let them get bigger when they should have been broken up, and tried to stabilize housing prices when market forces are still telling us years after the peak that prices need to fall further.

Individually, the politicians in DC are palatable.  I really like my representative in Congress and I can accept my two Senators.  Collectively though, something very bad happens.  It’s a combination of group think, a culture that embraces gridlock as standard rather than compromise, and leaders who I do think are lousy (on both sides of the aisle) because they worry more about politics and the next election rather than doing what is right long-term for the country.  Toss in an entitled yet apathetic electorate that does not take their democracy seriously,  super PACs and special interests who do, a Federal Reserve that has been worrisome in policy for the past 20 to 30 years, and fraud waste and abuse from the red-tape that is known as the federal government and you have what we’ve got today.

I wish there was a reset button.

– G.S.

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Tourniquets and Feces

July 15, 2011
The debt ceiling debate – a false choice fostered by Republicans

He’s Going To Turn Green Next!

 I have opined at length in the previous article and I felt it was way too scattered and didn’t drill down to the point, so I crafted this post to refine it.

 The bottom line is that the Republicans are wrong on this one.  I philosophically agree with their stance on containing big government, but this is not the way you go about it AND they are showing the part of the problem in Washington by being more concerned with politics than what is best for our country.  This is due to:

 1)      Raising the debt ceiling is not a question.  It must be done, it is a foregone conclusion.  To state that raising the debt ceiling itself is a compromise is a false premise.  The consequences of not raising the ceiling are catastrophic and is not an option, hence what they are offering is not a compromise and understandably something the Democrats can not agrree to.  If you disagree with me about what a default would mean, just read a couple of articles from the Washington Post, New York Times, or the Wall Street Journal.  It is very, very bad and unnecessary.

 2)      Which leads us to point #2.  The definition of compromise is that both sides give up things they want to meet in the middle.  You aren’t 100% happy with the end result, but you can live with it and the deal moves forward.  The Democrats offered up their sacred cow of entitlement cuts, the Republicans must offer up their sacred cow of raising taxes. 

3)      Raising those taxes isn’t on middle class or the poor.  It’s on the wealthy and on corporations, both in explicit raises and loophole closures.  Those guys have been getting breaks for years, it is only fair that they pay their fair share.

 4)      It is a false statement to then claim that the Democrats are raising taxes on ‘job creators’.  That is BS because if these ‘job creators’ really needed or wanted to create more jobs, they could.  Small business entrepreneurs are who are getting crunched – and those are the guy who DO hire employees and shouldn’t have their taxes raised.  I’m not saying raise taxes on them.  Large companies have been making record profits of late – they are FLUSH with cash.  They have plenty of money to reinvest in their companies, expand business, and hence hire more employees.  They don’t not because they can’t but because they won’t due to ‘uncertainty in the market’.  If they put their money where their mouth was and expanded their business, they would put more people to work, stabilize local economies, and add more money to government coffers via additional taxes; helping government revenue figures as well. It would create a virtuous cycle instead of a downward spiral, but it is an exercise in the chicken or the egg that no one can force big business to make. 

 5)      Transversely, we should also help small business out any way we reasonably can, even if it means spending money because the return will be far greater than the investment.

 6)       The exercise is as simple as only raising taxes on wealthy individuals and on medium and large companies, but exempt small business (places with 50 employees or less).  Also, redefine wealthy.  The current tax system classifies my father in law as wealthy, but he is simply well-to-do, upper middle class.  However, he has a neighbor who while is not filthy rich, he is wealthy and can afford more taxes because in part, his expenditures have less bang for the buck by having large sums of dollars go into the hands of a certain expensive enterprises.   The neighbor pisses away hundreds of thousands of dollars on unneeded prize llamas and wings to an already huge house in addition to already having two other homes.  The money doesn’t trickle as far or into as many places in the economy.  I am not saying he doesn’t have a right to do this; what I am saying is that he can afford to be taxed more because raising his taxes is not going to negatively impact the economy.  On the other hand, I see my father-in-law spending money in the real economy, just like the rest of us.  He has a budget, retirement, and real financial concerns.  The only difference between him and the average American is that he makes more money, but not to the point where his spending is luxurious, profligate, or wasteful.  He isn’t the one you tax; instead it is his neighbor, Lady Gaga, and the Wall Street bankers are they who you raise taxes on.  Besides, letting my father-in-law keep some of his money instead of going to the tax collector is more efficient.  It is more efficiently spent back into the economy by him directly rather than wasteful, more centralized government control.  Thus the line of proposed taxes on ‘the rich’ is not $250K.  I don’t know if its $350K or $500K or $1MM, but it is somewhere between what my father-in-law earns and what his neighbor makes.

 7)      Given dedicated time on the issue, the size and scope of government could be cut way back while also finding the common-sense and fair places where taxes can be raised.  There are so many loopholes and people and institutions that take advantage of the tax code that it needs reform to reduce the overall tax rate while actually raising revenue.  Savers should be rewarded and not punished for their long-term outlook

 8)       On the other side of the house, the government is so large and has so much fraud, waste, and abuse in it, that there are plenty of ways to cut government across the board, save hundreds of billions of dollars, and get the same result because government becomes more efficient.  ABUSE:  How many times have you heard of overpaid, lazy government workers who do not fear for their jobs?  Fire those people, pay their replacement a fair wage, and expect more out of them.  If not, fire them too.  Real unemployment is somewhere around 16.5%.  WASTE:  How many times have you heard people in government spend money because it’s there to spend?  If they don’t use it, they lose it.  It is that mentality of ‘other people’s money’ that leads to the waste.  Break that cycle through alternative incentives – possibly shared monetary compensation for efficiency.  FRAUD:  How many people scam the federal government on rigging their welfare, healthcare, and other forms of government assistance to both the states and individuals?  Root those people out, stop the bleeding of money, and throw those people into jail to show the rest of the cheats a lesson.

 9)      If anyone is serious about reigning in government AND getting the country’s fiscal house in order, they know that a 4 trillion figure in deficit spending cuts is just the beginning.  Anything less that is proposed is an insult when $4 trillion in cuts is on the table.  I believe the President because of the mantle that he has assumed in trying to solve this problem.  I do not believe the Republicans.  The Republicans don’t want to give the President the political advantage of having a solution to make real inroads into solving this problem.  Like they say, he owns the economy.  Republicans are more worried about politics than what is right for the country, thus they wouldn’t want the President to get the credit since he owns the economy for good just like he would for the bad. 

 10)    Lastly, a grand bargain of $4 trillion dollars in cuts over 10 years is a great start to getting the country’s debt problem in order, but it is just the beginning.  That still means deficit spending, just slowing the growth of it.  To get to a budget that actually has money left over at the end to pay down the national debt means you have to have cuts to spending programs AND you will have to raise taxes.  THERE. IS. NO. OTHER. WAY.  We have already gone too far down the path of fiscal irresponsibility to only have cuts.  We need both.  Anyone who tells you either is not looking at the long term trend nor are being honest with you.  As we have seen, taxes can be cut, but not until the books are back in the black.  There is nothing saying taxes increases have to be for perpetuity.

  I am a true libertarian, I am told in the auspices of Jeffersonian Liberalism.  I am a conservative, but not a Republican, and certainly not a partisan fool.  It is better to ‘tear the band-aid off and eat your peas’ now, then do it later when the country is in a true survival situation (because this is an optional crisis) and the analogy shifts to applying a tourniquet and eating your own feces…

– G.S.


A Game of Chicken

July 13, 2011

EAT YOUR PEAS DAMMIT!!!!

I will take a break from my ‘solutions’ series and interject an article about the current politics of the nation and the game of Chicken that quite frankly, my Republican friends are playing.  Yes, you heard me right, I am siding with the Democrats on this one, but just in political substance, not policy.

You see my fellow citizens, the Republicans are giving a false choice to you.  They say that their ‘compromise’ is the raising of the debt ceiling at all.    They will raise the debt ceiling and the Democrats have to enact entitlement program cuts.  Taxes per Grover Norquist are OFF THE TABLE for the Republicans.  That is a red-herring fallacy.

Not raising the debt ceiling is not an option.  It has to be done because there isn’t any time left to make a problem that would truly stem the tide of rising costs.  They haven’t done the legwork to truly figure out how to pare the federal government down without ripping the country apart since its presence is felt everywhere.  I agree it needs to be done, but you don’t cut out cancer with a broadsword, you use a laser scalpel.  Since the Republicans have frittered away the MONTHS of time that they had where they could have made such a plan, they now posit the untenable position of simply targeting entitlement programs and not the huge amount of fraud, waste, abuse, cronyism, and special interests that actually make government so large, expensive, and inefficient.

Not raising the debt ceiling is also not an option because of the  completely unnecessary financial and economic crisis that would descend upon this country.  We saw it before in 2008 – the markets are all a confidence game.  You lose confidence and the bond-holders go running.  Even if it is voluntary, the costs to further debts in the future due to rising interest rates would be long-term and real.  It would cost more to borrow money.  It will even sit worse with the electorate if the US pays its debt holders first (China) and doesn’t send Grandma her Social Security check.  For political reasons of voter wrath, there is no way that a politician thinks that is a good way to get re-elected.

Scarily, it is the President that is actually showing leadership on this one.  He recognizes what compromise is and if people are serious about curbing national debt, then they’ll take the current opportunity to take a real chunk out of future spending.  he honestly proposed touching liberal third rail issues and give on them and expected the Republicans to do the same.  I believe he is generally misguided in what he thinks is best for the country, but he looks like a centrist who appeals to centrist nature of the country more than the Republicans who truly believe are posturing at this point.  I honestly do not believe the Republicans are sincere on wanting to really make the best effort possible of curbing debt because we have dug a hole that is way too deep for ourselves as a nation to not have tax increases and even reasonably expect us to get out of this mess.  It is a combination of loyalty to Grover Norquist and his pledge for fear of what a negative endorsement will do, and it is also due to the fact that a failure on the President’s part is good for them.  Maybe so, but it’s certainly not good for the country – just like a default scare or wasting a bunch of time on a scare good for the country.  There are plenty of problems to solve – unemployment, energy, trade deficits, etc and this is basically all Washington has done for months.  Absolutely pathetic.

Also, don’t tell me that raising taxes and closing loopholes on the riches of Americans and corporations will hinder growth.  Major companies are reaping record profits and are sitting on the cash.  They are not expanding their businesses or re-investing it.  They claim uncertainty and weakness in the markets…but what comes first, the chicken or the egg?  People won’t feel good about the economy or spend money if they continue to see layoffs.  BUT, if a company took some of the those record profits and reinvested into a local economy and opened up a new division…  The same argument can be said for the richest of Americans as well.   They as a percentage of income pay less than the average American.  There is a point where their wealth doesn’t efficiently go back into the economy.  For every yacht that a fortune 500 company CEO owns, how much could the livable wage be raised for the rank and file hourly workers making $10 an hour whose empire is based upon their work.  You know that $10 an hour is not a livable wage, so those people have to get a second (or third job) sometimes.  Undue taxation for wealth-creators is un-American, but also is not paying your fair share back to a system that you have greatly benefited from while also semi-victimizing the same people who enable your empire.  I’m the furthest from a socialist that you’ll find, but this is a country based upon freedom and having to work 80+ hours a week just to scrape by at $10 an hour is just a form of economic bondage and is also un-American.  There has to be a balance and asking the most vulnerable in our society to have cuts to the programs that help support them while not asking the richest of institutions and individuals to give up a dime is simply wrong on top of bad policy and economic fantasy.

Thus, I propose finding that line where a business is no longer small and an individual ‘has more money than they know what to do with’.  At that point and higher, that is where you raise taxes.  You are getting the most economic bang for the buck as you are not hindering the real engines of economic growth – small business, but you are also not taking bread out of the mouths of people who actually put the money back into the economy versus just pissing it away of opulent, foreign-made luxury items.

So, with all that said, you can see that I am yet again proud of my libertarian stance.  Its shit like this that makes me glad I am not a Republican.  I disagree with Democrats philosophically in most ways, but they make the sound and correct argument in this case. 

Lets just say the US does default and the government has to pick and choose what obligations it pays.  How will it look to the voters (especially the most active block – seniors) when we dutifully make our interest payments to the Chinese, but Grandma’s social security check doesn’t go out in time?  The Republicans would get blamed and they’d get washed out in the tide of the 2012 election, Obama would get re-elected, and then the country would be set up for even worse things to come with an emboldened and empowered Democratic legislative and executive branch.

I weep for my country and the lack of leadership that we have.  I’d be kicking somebody’s ass if I was the President.  It would be time to pull out the weapons-grade, Ross Perot style charts and insultingly lucid Jon Stewart interviews that show all the holes and fallacies in the opponent’s argument.

–  G.S.


Solution 1B) Entitlement Reform – Social Security, Medicare and Medicaid

July 6, 2011

"Well now your back's going to hurt!"

So here is where the hard part begins when I specifically start talking about entitlements.  Before I begin on how to actually fix them, I must point out two oxymoronic aspects of entitlements in general.  The first is that everybody is generally for a getting the nation’s fiscal house in order by fixing the budget and the deficit.  Everyone generally knows that the government spends too much, even if it admittedly does a poor job at collecting taxes from entities that should be paying them.  Secondly, everyone generally also knows that it is the big three entitlement programs (Social Security, Medicare, Medicaid) are really what imperils our nation fiscally.  The liabilities in the future for the same level of care and money provided to more and more aging baby boomers is completely unsustainable.  Why then, does everyone know these two facts but just continue to stick their head in the sand?  The longer you wait, the worse the problem will get!

With that set of observations out of the way, I am prepared to tell you the hard, ugly truth about entitlements.  It is not meant to be offensive, critical, or an attack.  This is simply the blatant truth.

Entitlements create the false choice of promising something this nation, as great as it is, cannot deliver.  Every year, we spend more and more money that we do not actually have on an elderly population that has a disproportionate sway on government (because they actually vote unlike other demographic groups – but good for them!) and that money/healthcare is seen as a something the elderly population is entitled to collect.  That money goes to a generally unproductive strata of society that was over-promised a system of support in their waning years and underpaid into it due to bad government programs and policies of the past.  It hurts to say it but its true.  Its also highly unpopular and not fair to just pull the plug on Grandma.  Meanwhile, that same money that is keeping her alive but giving her years of sub-standard quality of life standards at a retirement home could have been reinvested in education, energy development, infrastructure, or co-opting domestic business development; all things that yield a return on the money spent.  Outside the fact that some of the money is spent outright on consumption in this consumption-drive economy, money spent on entitlements just goes up in smoke .  This is not to say that we leave the elderly on the streets, but it is a painful amount of federal and state monies being spent on the past, not the future.

The problem and difficulty with entitlements is that it is really, really easy to promise something that was cheap 40 years ago, but really hard to pay for it today or claw it back when the expenses have greatly gone up.  The rules have changed.  People are living longer, more complex medical procedures cost more and then they keep people alive longer as a form of double whammy.   A great example of how things have gone awry is the Social Security retirement age.  Social Security benefit ages have not risen as fast as life-expectancy in this country.  FDR’s administration originally designed it with an age bracket in mind that most Americans never lived to see.  Many paid into the system, but didn’t collect from it.  That is how it was sustainable.   Society today is also far more likely to ship parents and grandparents off to the expense of a home rather than have the ‘burden’ of them living with family once they get too old to take care of themselves.  Hence, the tax-payers pay for the greater cost of care than the cheaper alternative of the elderly staying with family…even if further subsistence payments were available for family-based care.

The same general principle can be applied to health-care for the poor.  “It’s not my money, it’s the governments so why do I care?”  Well it is your money in a very direct sense every April 15th.   Indigent care, unneeded ER visits, and other forms of “disinvested” spending are ways that great sums of money are wasted.  And that is a problem my friends – we spend way too much money to get substandard results of an impoverished elderly class, expensive health-care, and a culture of dependency in welfare.

My statements do not mean that the poor should die in the streets, that the elderly should just hurry up or die, or that you have to pass a ‘contributing to society test’ in order to get help should you fall on hard times.  My statements are aimed at how we strive for noble social goals to take care of our most vulnerable citizens and we yer fail both them and our future citizenry grandly by continuing to contribute to the fraud, waste, and abuse of the current system.  Good enough just won’t cut it much longer.

The Solution(s) –They are actually very hard, but amazingly simple.

1) The first and the greatest is the solution I proposed to make medical care cheaper and more effective from the previous article.  By following that program, you lower everyone’s costs and it makes it a lot cheaper to care for the elderly, the poor, and everyone in between.  That right there has a direct effect on how wealthy a person actually is from the social security check when only a fraction (instead of 2/3rds) goes to prescription, co-pays, and medical charges.  And obviously, cheaper healthcare means cheaper Medicare and Medicaid costs.

Such reforms only get us treading water however.  There are still too many promises and IOUs in the accounts of these programs.  Instead of making a patch that will last for 25 – 30 years, like the US did in  1983 for Social Security before it needs to get fixed again, lets put the problems to bed once and for all.

2) Social Security:  Raise the retirement age.  Early retirement 64-66.  Standard retirement 66-70.  Delayed retirement 72-74.  Something like that.  I purposefully put a range in as this is nt supposed to be hard and fast, but give you an idea of what I’m thinking.  You see, there is some misconception in this country that you work for X years and then you don’t have to anymore.  THE WORLD DOESN’T WORK THAT WAY IF YOU DON’T PROACTIVELY SAVE FOR THAT DAY.  Solely depending upon social security is what keeps over 40% of our elderly citizens out of poverty…and even then it’s not like they have a lot of money to work with.  This country needs to get off the mindset that someone will be there to take care of you, so you don’t have to make financial sacrifices now in the form of an IRA or a 401(k) to ensure your financial security in the future.  Too few people save and its the savers who get punished by low interest rates (like today’s environment) or possibly later.  All it will take is Congress’s writ and things like ROTH IRAs could be taxed despite already being taxed as regular income when the money was deposited.  Platitudes like ‘shared responsibility’ and ‘helping your fellow American’ are all to easily thrown out when times are depression level tough and money has to be raised.  While this is mere conjecture, look at the current batch of charlatans in Congress, look yourself in the mirror, and try to lie to yourself and say they wouldn’t do it today if push comes to shove.

Lastly, if you’re one of the lucky few who have a retirement program, good for you…but you are in a dwindling minority.

3)  Social Security:  After a certain lifetime income, benefits decrease until they are gone altogether.  Call it a ‘success tax’ if you will.  This program doesn’t affect the middle class or even the well-to-do, but the actual truly wealthy people in this nation who have millions in brokerage accounts, have yachts, a home in the Hamptons, and in retirement, could maintain a middle class existence on the interest payments from their assets alone.  These guys don’t need the help of the American tax-payer.  Yes, they paid into a system they never get to benefit from…but they did benefit – from ree market, American style capitalism.  Their success, their profits, come from the people whose hard work made them money and their wages bought their products.  They directly and indirectly benefitted from people who were monetarily less successful than them but buoyed their success.

4)  Medicare:  Make the free market the cost standard – not the other way around.  Today everything is based upon what Medicare bills.  In my solution from the previous article, it is the market…and that is what medicare pays.  It is just another way to dampen bubbles and pay fairly for services as Medicare would still be a large buying block of patients in any market.  The rest of solution 1 addresses the directly reduction of Medicare costs.

5) Medicaid as a subset of the welfare system:  It’s the carrot or the stick.  The truly poor, helpless, underaged, and defenseless sectors of society need to be protected no matter what, no strings attached.  Solution 1 at least makes it cheaper.  However, there is a portion of the populace that abuses the system, to include their health care.  They choose to be ‘poor’ because it actually enriches them.  Why work at a crappy job, make $400 a week and have to pay food, rent, day-care, and health insurance costs and not have ends meet because you are lazy and have no other opportunities for employment other than working at a McDonalds when instead you can be on welfare, do nothing, and get food stamps, WIC, child-based welfare checks, and a Medicaid card?  Then you may only get a check for $300 a week, but its all discretionary as the government pays the rest of your bills?  A self-interested person would of course choose the second option, especially if they have no qualms of not contributing to society.  The welfare state for the unworthy and the willingness to take advantage of it are both un-American and I take a very dim view.  We need both the carrot and the stick.  Those who can’t pass drug tests, keep jobs, and generally be contributing members of society despite being able-bodied need to be cut off.  It is not government’s responsibility to subsidize their sloth.  However, if we are to take such a hard approach, we must have a carrot as well.  Workers must be given a living wage.  This is a combination in  a raise in minimum wage, a reduction in costs of life’s necessities where possible (food, energy, etc – I’ll cover in another segment), and more investment in social services that teach job skills, place jobs, and dust people off and get them back on their feet.  If they are willing to work hard and contribute, then the welfare system is working how it should.  This section was much larger than just Medicaid, but that program is a subset of a much larger issue that is hard to separate Medicaid from, so I covered the major points while admittedly going off topic.

Finally, I don’t admit to having all the answers.  I probably have more in my head and there are more out there.  This article was designed to give you some specific solutions, but also take 3 steps back and evaluate entitlements and how they are viewed in general.  If you can come at them from a fiscally sustainable obligation that is fair while not stealing from the future of the next generation of Americans, then you’ve arrived at the same conclusions I have.

– G.S.


Your House Is On Fire – And Mine Is Catching…Thanks – Part 2

March 31, 2011

tell me...how is this fair?

 

Not even a year ago, I wrote this article among others.  It was about the Greek Debt Crisis and how Europe wasn’t solving its problems but just kicking the economic can down the road.  It took just over 10 months for all the money spent over Greece to burn up confidence in the EuroZone.  Now its Ireland and Portugal whose leadership is in flux and their economies and banks in turmoil.  They’re called PIIGS for a reason.  Portugal, Ireland, Iceland, Greece, Spain.  Mark my words, Spain is the one to REALLY worry about.

   You won’t see this stuff at the top of the news…and that is my point.    Too many other juicy stories drown out the very significant problems of the European Debt Crisis.  The synical and conspiracy theory part of me thinks its convenient that way…but that gives people too much credit.  They’re more worried about Dancing with the Stars and American Idol….and if they are in tuned, they see the kubuki theatre of  ‘fiscal debate’ going on in DC right now.  Congress is arguing over about $30 billion in spending cuts when we have an annual deficit of something to the effect of $1.5 trillion on our $3.8 trillion budget.  Congress is arguing over the change in the couch while the house around them is burning down.

  The next to last thing we need is Europe’s serious economic problems.  The last thing we need is to ignore them and get caught with our pants down when it spreads.

That is the problem with socialism, eventually you run out of other people’s money (thanks Margaret).  It’s that socialism that is sinking Europe and what we’re ignoring here at home.   What will that mean for your pension, your 401(k), your children’s future?  What are you willing to do about it. 

I can tell you that the same tired players who have money and power from the status quo aren’t the answer.  We need to elect new leaders, pure and simple.


A Sad, Sad, Day

February 24, 2011

...and only getting sadder.

As a libertarian, there are very few things I think our government does well.  I can only name two off the top of my head – and we still could do both better.  The first is field a military and the second is putting stuff into space.  We’re giving up one of those.

In the era where we have MULTIPLE useless bailouts that wastes trillions and give $787 BILLION dollars to the exact same banks and institutions that put our country on the brink of economic collapse, the books are already cooked.  We go further into debt by trillions of dollars every year with the interest payments alone to our debtors reaching into the hundreds of billions.  We’re not doing the basics like fixing the tax code, health-care, and social security programs…I think we can at least afford to give NASA a few billion dollars more.  God knows, it’s a better way to spend tax-payer money.  At least you get jobs, science, technology, and achievement in return.

To that end, and to get to my point, the space shuttle Discovery made its final launch today – the 39th of its own and the 133rd of the space shuttle program.  For all of the life I can remember, (I’m 30) the space shuttle program has been there.  The first impression it made on me was when I was 5 years old and Challenger blew up.  I really didn’t fully understand what was going on – but I remember that ‘our’ spaceship blew up and that I was sad because everyone around me was sad.  As sad as that day was, I bet those 7 souls are sad because much of their legacy is ending with no real next step in sight.  Our solution now is to use antiquated Russian junk to haul our best to merely low earth orbit at the International Space Station.

   Funding for NASA is one of FEW things I truly believe that government needs to take an active role in.  Yes, it may go against every libertarian fiber in my body, but hear me out…just like our national defense…there are no other entities that can provide the resources to do the job adequately and this is a quest just as American as our guns and apple pie.  It is literally in our history and our DNA as Americans.  It was manifest destiny for our forefathers to head west and forge new lives on the frontier – NASA ia the embodiment of leading the way to do the same on the next frontiers and create tomorrow’s tomorrow jobs and technology.

 The Apollo Project was the greatest feat in the history of man-kind; its crowning achievement – putting a man on the moon, victoriously accomplished as President Kennedy wished before the end of the 1960’s.  Those were the glory years.  Today, we have cancelled multiple next-generation programs that were supposed to replace American space flight after the space shuttles retired.  I can name two – the X33, the real next step as a reusable space plane that looked somewhat like the space shuttle, and the Orion spacecraft – a 21st century rehash of Apollo.  Instead we have neither with no plan, money, or program to fill a hole for what looks like to be a decade or more because we see NASA’s budget cut back year after year.  Even with the space shuttle and our currently technology of today, we couldn’t go back to the moon even if we wanted.  Tha was what the Orion spacecraft was supposed to be for – to build a modern version of the technology that we had 42 years ago!  We used vacuum tubes to get to the moon and we didn’t develop the technology further.  You can have every self-parking Lexus, iPhone, and flat panel HDTV that you want – but that crap doesn’t get you to the moon.  We have done nothing in that nearly half century span of time to move mankind forward for its next feat…and our best chance, NASA, keeps getting cut off at the knees.

Look at how the space race via the Apollo Project changed our lives by changing our outlook on the Cold War and gave us new technologies never dreamed of.  All done on a wish to beat the Russians, so the US government spent the money to invent these new technologies so that we could get to the moon.  The Apollo Project was materially expensive, but what we paid was an investment for this country’s future – it was money well spent.  All I am asking is to reward such success.

Yes, this country is broke.  Yes, there are too damn many things wrong out there that take precedence…but they are easily fixed by a capable government and a disciplined populace.  Unfortunately we have neither.  However, that is no excuse to throw the good out with the bad.  I truly believe that the expense and budget it would take to make a true 21st century space vehicle, return to the moon, and then go to Mars and beyond would follow the exact same formula of being materially expensive, but have an amazing return on investment…and the catch is, it wouldn’t even be an extra $10 billion a year – a drop in the bucket compared to the trillions of dollars our government wastes every year.  What we could learn, invent, and discover as a nation (and species) would be far greater than we realize.  Its a nearly infinite universe out there – but we would have to take the second step to start tobegin to truly tap the knowledge that could be made out there. 

Maybe I’m a dreamer.  Maybe I believe in a better United States of America where we fund great projects not because they’re easy, but because they’re hard and that makes them worth doing.

– G.S.


Repent! The Day of Reckoning IS At Hand!

February 19, 2011

"Look at me...you think I'm joking when I say 'a modest proposal'?!?"

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 My roots are in Jersey.  It’s where my family is from, my wife’s father and his family is from – but we all call ourselves Virginians now because we left the insanity that is known as The Garden State.  I unapologetically call it The Armpit Of The Union.  High taxes, they generally hate your gun, filthy cities, liberal as Hell, and you can’t even pump your own gas (the ESL guy has to do it for you so he can have a job).  Jersey basically is pissed that NYC is right across the river and they take it out on its citizens.

   For whatever reason, the state was blessed with Chris Christie however, and possibly just in time to save it from itself.  For all the semi unfair bile I just regurgitated against the state, it’s still America and I am a fan of its governor.  He sees the trainwreck his state is moments before its going to happen (but still far ahead of everyone else) and he has the balls to try and throw the brake before its too late.  Sure, there’s wailing and gnashing of teeth in Trenton – and for good reason.  He’s probably going to have to raise taxes.  I’m not a fan, and neither is he – but he realizes that to save this patient, there is going to have to be more pain…but he also recognizes that he doesn’t have a revenue problem…he’s got a spending problem.  Hence the spending freezes, the program cuts, and most famously – his head on fight with the public sector union and their entitlement programs…and his isn’t the only state.  You see the drama unfolding in Wisconsin as we speak.  The same story can be repeated across this country and generally the more populous the state and liberal your legislature is, the bigger the problem you have – hence why Christie and NJ are the canaries in the coal mine.

  Almost 2 months to the day, 60 Minutes did a story on this brewing crisis…and that is what this is, this thing is brewing as it’s just the beginning.

http://www.cbsnews.com/video/watch/?id=7166293n&tag=cbsnewsMainColumnArea.10

  What do you think is going to happen to all of those whining public sector unions when the state goes tits up on it and declares bankruptcy?  I don’t have a pension as management at a small, manufacturing plant even though I am a manufacturer whose business actually creates high paying jobs and pays taxes to the government.  The best I can do is having a matching 401K and not get raked over the coals on my health insurance as a young person with a kid on my plan.  Thank God my wife has her own plan at her work – things really jump up for a family plan.  But I don’t complain – that is the reality of working in America today.  The other side of the reality is that the taxes FROM the my workplace go to pay for a state employee who is probably living a bit too high on the hog with a pension and life-time health-care benefits because they got a good deal from the state because of their collective bargaining when things were better.  They work for an inefficient bureaucracy that we give too much money to for too little result – and they want to have life-time retirement plans for being a part of a business like that!  That my friends, is the problem with more government – its easy to spend SOMEONE ELSE’s money – to paraphrase Margaret Thatcher.  God forbid that government go back to the state unions with their sweetheart deals and say ‘the times have changed, we’ve made too many promises to too many people and created too much inefficient bureaucracy – something has to give because we simply don’t have the money anymore’.

  What the unions don’t get is that they can bitch and moan and try to squeeze every last dime out of the government, but it will drive the government to insolvency and then they could get nothing and it certainly will be less than any deal struck to try and head off the mess; because once you’re insolvent, all the cards are on the table then whether you want them or not.  Between these 50 states that make this great country, there is an estimated 1 TRILLION+ dollar shortfall (that’s from Pew Research) and that is what they can see before you actually get into the cooked books.  You and I both know that if citizens or businesses ran their personal budgets like the state and federal government does, then we’d be both bankrupt and in jail.

  If we don’t get more Chris Christies then some states will have to declare themselves insolvent.  I bet a lot already are, they just won’t admit it.   The states just don’t have the money and the obvious sin of the past that is coming back to haunt them are the juicy public sector entitlements because its easy to pass the buck on to future generations.  Well, they’ve been doing it via bad deals for over 50 years and now the day of reckoning is at hand.  No more high property taxes to leverage against and paper over the mess – the tide has receeded and the state governments have been found to be naked!

Yes, there has been talk about a federal bailout.   ANOTHER expenditure of money we don’t have that doesn’t even get to root of the problem – so you could have similar problems in future years.   That’s going to go over as well as a turd in the punchbowl in DC and the reality of the matter is that the The House of Representatives will never pass it, and that is because of who the citizenry has elected there for the time being.   You want to talk about people in the streets?  How do you think I’ll feel because myself and my kids (and grandkids) have to pay for those bailouts because New Yorkers, Californians, and Wisconsinites think they are entitled to their dinosauric yet juicy public sector programs? 

 It’s another form of a redistribution of wealth and socialism at its worst.  Your states made the bed they lie in, don’t pass the buck the to rest of the country.  Let your states and pensions fail, then you’ll wish you would have worked with the Chris Christies out there.  I’m telling you, repent before its too late…

– G.S.