...usually with an attempt at historical and economic context
Wednesday, December 16, 2009
Obama’s and Democrats’ Debt and Deficit Trade-Off
The ol’ U.S. National Debt clock keeps ticking. It’s now up to $12,139,146,898,976.64 or an estimated $39,479.46 per person as of 12/16/2009, 5:57 PM CST. 
The Treasury Department says the debt was $12.079 trillion as of Tuesday 12/15/2009 and should reach its current limit of $12.1 trillion by month-end. The House voted 218 to 214 to raise the debt limit to $12.394 trillion, which should finance the government for about two months. 
Reuters quoted Rep. Mike Pence (R-IN) as saying, “When will it stop? When will Washington get the message that we can't borrow and spend and bail our way back to a growing America.” 
House Democrats discarded the proposed debt increase of more than $1.8 trillion. Of course, this is good news. The House is still expected to consider a “jobs” bill of tens of billions, which would add to the deficit. The Senate apparently won’t consider that item until they finish with health care. 
“Fiscal conservatives in the Senate, meanwhile, led by Budget Committee Chairman Kent Conrad (D-N.D.), had been seeking the creation of a bipartisan commission with authority to force spending cuts or tax increases through Congress.” 
House Speaker Nancy Pelosi has rejected this idea as giving up too much congressional authority. I almost agree with her. I would say it gives up too much congressional responsibility. If you (or your staff) can’t do your job, hire consultants or contract it out. That seems to be a frequent response by government officials in general, both parties and all levels. The idea is to avoid accountability and tough decisions.
There seems to be concern among Democrats over the deficit and federal spending, yet they press for the health care “reform” bill which will significantly increase spending and the deficit, as well as taxes. There will be serious tax increases, but these won’t really cover the added expense.
The chief actuary of the Centers for Medicare and Medicaid Services, Richard S. Foster, reports that national health care spending will increase by $234 billion over ten years under the Senate bill. The report does not allow for increasing Medicare to cover people aged 55 to 64 years. 
Also, public support is decreasing, as Senate Republican Mitch McConnell says:
[Politico video at Examiner.com]
President Obama and Democratic Party leaders are determined to get some kind of health care bill passed soon, regardless of what changes might be needed. If they discard the public option, abortion funding, etc., you can be sure these will be added back later.
The high level of public opposition remains the best reason to think this bill might not pass. But Obama and some others are adamant about nationalizing the health care industry as part of their restructuring of American society. Cap and trade and health care socialization are the cornerstone pieces of Obama’s grand plan to spread and consolidate federal government power. Compared to these items, concerns about jobs, the deficit, and the economy in general are strictly secondary.
If that were not the case, steps to greatly help the economy (including discarding health care “reform” and cap and trade) would already be in progress and we would be seeing good results already. But the economy has a hard time flourishing in an environment of increasing massive deficits with no end in sight, high taxes with more on the way, and a regulatory burden that’s quickly becoming unbearable. Current policies have serious risks. Higher levels of debt are harder and more expensive to finance. Will China cooperate indefinitely? Is high inflation on the way? Can interest rates stay low?
Fat cat bankers aren’t the problem. Government is.
I have sworn upon the altar of God eternal hostility against every form of tyranny over the mind of man.