The tax-and-spend Obama budget

800Gambler

800Gambler

2



President Obama's 2010 budget proposal includes a massive 25 percent spending increase. Heritage Foundation budget expert Brian Riedl explains that this "spending increase represents the largest non-war government expansion since the New Deal."
Riedl breaks down what the Obama budget plan would do:

  • Increase spending by $1 trillion over the next decade;

  • Include an additional $250 billion placeholder for another financial bailout;

  • Likely lead to a 12 percent increase in discretionary spending;

  • Permanently expand the federal government by nearly 3 percent of gross domestic product (GDP) over pre-recession levels;

  • Raise taxes on all Americans by $1.4 trillion over the next decade;

  • Raise taxes for 3.2 million taxpayers by an average of $300,000 over the next decade;

  • Call for a pay-as-you-go (PAYGO) law despite offering a budget that would violate it by $3.4 trillion;

  • Assume a rosy economic scenario that few economists anticipate;

  • Leave permanent deficits averaging $600 billion even after the economy recovers; and

  • Double the publicly held national debt to over $15 trillion ($12.5 trillion after inflation).
This simply isn't a workable budget. Instead, Riedl warns, it threatens to undo 25 years of economic policy that have created a freer, more prosperous America.
There's a better way

If massive spending isn't the right way to fix the economy, what should lawmakers do? Heritage experts have given members of Congress a number of suggestions.
Reducing tax rates and holding down spending would "reduce impediments to starting new businesses, hiring, working, and investing," Heritage's J.D. Foster explains. President Obama's budget goes the other way, he says. "The economy today faces massive tax hikes beginning in 2011, especially on small businesses, investors, and savers." This policy discourages job creation and economic recovery.
? Read more on MyHeritage.org
Building the next generation

One of The Heritage Foundation's missions is training the next generation of leaders who can advance conservative ideas. Each summer, Heritage hosts more than 70 interns who help our experts with policy research?important experience for young people getting involved in policy debates. Just as significantly, our interns, who live in our on-site Johnson Building dormitories, receive critical instruction in the principles that have made America great.
But don't take it from us. Watch this video where our interns explain the program for themselves:
​
> Other Heritage work of note


  • Al Qaeda may be able to take advantage of political instability in Pakistan, Heritage's Lisa Curtis writes on FoxNews.com. She warns that "al Qaeda-backed extremists are salivating at the prospect of more political uncertainty and will exploit fissures in the system and discontent among the people."

  • The Obama administration has adopted a key Heritage proposal to advance the opening of Yucca Mountain as a nuclear repository. This key step towards increasing America's energy supply was included in a Heritage memo to the new president. In addition, members of Congress have introduced legislation cutting nuclear industry red tape?legislation inspired by Heritage experts.

  • New Mexico lawmakers have approved a commission to study the possibility of establishing a health insurance exchange in the state. Heritage experts have worked closely with state officials to advance the exchange concept, which would allow individuals to purchase their own health policy in a competitive market.

  • Conservatives have suffered a series of electoral defeats, and many have debated how the movement can regain its footing. Scholar Matthew Spalding, who directs Heritage's Simon Center for American Studies, proposes that conservatives get back on track by returning to the core principles described by the Founders. "A constitutional conservatism unites all conservatives through the natural fusion provided by American principles," he argues. And to be successful, he continues, "we must be consistent in principle but also innovative in practice."
> In other news


  • Lawmakers are demanding that executives at AIG, the insurance firm the federal government bailed out with $170 billion of taxpayer dollars, return their performance bonuses. While these bonuses certainly make for poor headlines, lawmakers should remember that it's only because of the bailout that the near-bankrupt firm can afford the bonuses at all.


  • "The Obama administration will endorse a U.N. declaration calling for the worldwide decriminalization of homosexuality," the Associated Press reports. The Bush administration had raised questions about the document's impact on American policies.




  • Plans for the federal government to ensure health coverage for every American could cost taxpayers $1.5 trillion according to some estimates?and this on top of the massive new spending already proposed.
> Coming up at Heritage

To attend these or any other events at Heritage please RSVP at Heritage's website. Or you can view these events live online. All times are Eastern.

  • On Tuesday, March 24 at 11:00 a.m., Patrick Sookhdeo from the Institute for the Study of Islam and Christianity explains the rise of shari'a finance.


 
B

BCTTWR

EOG Dedicated
Re: The tax-and-spend Obama budget

The piece of shit is determined to push our U.S. economy over the cliff. We are headed for rapid inflation. Possibly stagflation. The fuck wants to raise our utility bills up to 40%. Says he would not mind seeing $5 per gallon of gas.
 
Doc Mercer

Doc Mercer

EOG Master
Re: The tax-and-spend Obama budget

How did we get to the cliff?

What Operator drove this economy to the cliff?

any comments?

any recollections who was in charge before Bush?
 
brucefan

brucefan

EOG Dedicated
Re: The tax-and-spend Obama budget

WASHINGTON (Reuters) - U.S. congressional budget experts on Friday offered a darker economic and budget outlook, which could complicate President Barack Obama's efforts to convince lawmakers to pass his $3.55 trillion budget plan for 2010.

The Congressional Budget Office forecast a record $1.8 trillion deficit for the fiscal year that ends September 30 under Obama's budget proposal -- or 13.1 percent of gross domestic product.

The budget experts projected the deficit would then ebb some to $1.4 trillion for 2010 -- or 9.6 percent of GDP.

Since taking office in January, the Obama administration has been shoveling billions of dollars in a bid to reverse a steep downward spiral in the U.S. economy and prop up the struggling financial system.

"Although the economy is likely to continue to deteriorate for some time," the CBO said, the $787 billion economic stimulus package "and very aggressive actions by the Federal Reserve and the Treasury are projected to help end the recession in the fall of 2009."

CBO also issued gloomier forecasts for the U.S. economy, projecting that it will contract 3 percent in 2009 before growing 2.9 percent next year and expanding 4 percent in 2011.

The massive deficit forecasts come after Obama submitted in February his $3.55 trillion budget plan for fiscal 2010, which includes huge new programs to address healthcare and curb greenhouse gas emissions.

CBO also revised its forecast about accumulating deficits over the next 10 years, saying it would total $9.3 trillion from 2010 to 2019, which drew immediate fire from Republicans who have criticized Obama's budget for its massive new spending and tax increases on the wealthy.

"This debt buildup is due to massive spending that we cannot afford, and deficits that go unaddressed," said Senator Judd Gregg, the senior Republican on the Senate Budget Committee.

In January, the CBO forecast almost $1.2 trillion in red ink for fiscal 2009 and $703 billion for fiscal 2010, but that came before the economic stimulus package Congress passed in February to kick-start the ailing economy.

Obama's budget projected a $1.75 trillion deficit for fiscal 2009 and $1.17 trillion for 2010. The House and Senate Budget Committees were awaiting the latest CBO estimates before they begin to craft their budget plans next week.

Obama's budget outline to Congress last month included a forecast of almost $7 trillion in deficits through 2019 -- or $2.3 trillion less than CBO's projection.

(Additional reporting by Richard Cowan; Editing by Jan Paschal)
http://www.nytimes.com/reuters/2009/...gewanted=print

____________________________________

We kept hearing about how the GOP was bankrupting the country, but the Democrat's first budget has over 10 times as much red ink as the last GOP budget.



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brucefan

brucefan

EOG Dedicated
Re: The tax-and-spend Obama budget

Obambi's budget will BANKRUPT USA!!!
<HR style="COLOR: #d1d1e1" SIZE=1><!-- / icon and title --><!-- message --><!-- message --><EMBED src=http://www.youtube.com/v/RhiU3kSYRUw&hl=en&fs=1 width=425 height=344 type=application/x-shockwave-flash allowscriptaccess="always" allowfullscreen="true"></EMBED>


http://www.the912project.com/



 
Doc Mercer

Doc Mercer

EOG Master
Re: The tax-and-spend Obama budget

maybe Paul doesn't understand a simple concept:

OBAMA TOOK OVER A BANKRUPT COUNTRY !!!
 
brucefan

brucefan

EOG Dedicated
Re: The tax-and-spend Obama budget

brucefan said:
Obambi's budget will BANKRUPT USA!!!

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http://www.the912project.com/



Click to expand...




​
 
brucefan

brucefan

EOG Dedicated
Re: The tax-and-spend Obama budget

June 5, 2009

<TABLE width="95%" border=0><TBODY><TR><TD align=left width="80%">The Charm Offensive

</TD><TD align=right></TD></TR></TBODY></TABLE>
This week, Team Obama took their dog and pony show on the road. Treasury Secretary Geithner went to China, Fed Chairman Bernanke to Capitol Hill, and the President himself began a Mideast tour in Saudi Arabia. This full-court press is not coincidental, and comes just as the federal government has begun unloading trillions of dollars in new Treasury obligations. The coordinated charm offensive is meant to assure the world-at-large that the United States can repay these obligations without destroying the dollar.

Given the renewed weakness in the dollar and the recent expressions of concern from China, our largest creditor, about the safety of its current holdings, this is no easy sell. Not only must our leaders convince holders of our debt not to sell what they already own, but to back up the truck and buy a whole lot more. The hope is that a dream team consisting of a charismatic politician, a skilled Wall Street banker with longstanding ties to China, and a respected Fed Chairman, can close the deal. However, no matter how slick the sales pitch, no amount of lipstick can dress up this pig.

The most obvious fear the trio must address is that oversized deficits will persist indefinitely. Reading from a carefully scripted rebuttal book, all three proclaim that as soon as the stimulus revives our economy, the government will take all necessary steps to reign in the deficits that result. Bernanke?s testimony showcases this rhetorical shift. The Fed Chairman claimed that catastrophe has been averted and that the recession is nearly over. As a result, he advised Congress to now focus on debt management. How he expects them to do that was left unexamined.

Setting aside the fact that the recession is far from over and that the stimulus will actually weaken the economy in the long run, Bernanke?s words were less a practical guide to Congress than a bromide for our foreign creditors. Meanwhile, Obama carefully peppers his speeches with calls for Americans to live within their means, to save more and spend less, to produce more and consume less. But nothing in the government?s current fiscal or monetary policy will encourage such behavior. In fact, the objective of economic stimulus is to prevent such changes from taking place!

The laughter of Chinese students that greeted Secretary Geithner at Peking University shows how ridiculous this spiel sounds overseas. Actions speak louder than words, and the actions of the current Administration are deafening. Multi-trillion dollar deficits, bailouts, nationalizations, quantitative easing, and grandiose plans for government-provided healthcare, education, and alternative energy, render all their claims of future prudence meaningless. If our leaders will not make tough choices now, why should anyone believe they will do so later when those choices will be even harder to make?

Of course, it?s not just major holders, like China and Saudi Arabia, that need to be convinced. Since the largest holders are already in so deep, they have the greatest short-term incentive to play ball. While throwing good money after bad is certainly a lousy investment strategy, it is politically expedient as it delays the need to officially acknowledge losses. The spin is designed to keep all the smaller, more nimble holders from dumping their Treasuries. The major holders can publicly pledge their commitment to Treasuries, while they privately planning their exit strategies, as long as they feel that the smaller holders won?t spook the market by front-running their trades.

However, once the psychology turns, there is no way to stop the rush for the exits. Remember how quickly the secondary market for subprime mortgages collapsed? One day, investors were lining up to buy; the next day, the stuff couldn?t be given away. Make no mistake about it, we are issuing subprime paper and no amount of political spin can alter that reality. Bogus credit ratings aside, I think the world already knows this and it?s just a matter of time before someone admits it.

In the meantime, by continuing to lend, our creditors merely supply us the shovels to dig ourselves into an even deeper economic hole. Their credit enables our government to grow when it needs to shrink, finances bailouts of companies that should be allowed to fail, and enables a nation that should be saving and producing to continue borrowing and spending. As a result, the more money the world loans us, the less capable we are of paying it back. I really wish the world would stop doing us favors, as neither party can afford the consequences.

For an timely example, just look at California. With an unmanageable $20 billion deficit, California recently asked Washington for a bailout. With none immediately forthcoming, California was forced to make real and needed budget cuts. The hard choices, which will benefit California in the long run, would not have been made if federal funds had been committed. We all should be so lucky.

For a more in depth analysis of our financial problems and the inherent dangers they pose for the U.S. economy and U.S. dollar denominated investments, read Peter Schiff?s book "Crash Proof: How to Profit from the Coming Economic Collapse".
 
B

BCTTWR

EOG Dedicated
Re: The tax-and-spend Obama budget

The laughter of Chinese students that greeted Secretary Geithner at Peking University shows how ridiculous this spiel sounds overseas.

When will the dumb lemmings, some who post here defending the piece of shit as he tanks the economy figure out what the Chinese students already know?
 
4625

4625

2
Re: The tax-and-spend Obama budget

As a Libertarian, I believe the most efficient government, political and economic system is the situation where everyone looks after their own self interest. As for myself and what I view as my own best self-interest, I don't give a rat's ass about the economy, taxes, government spending, blah, blah, blah; in the end, it will all come out just about the same. As I have stated numerous times here, I care about: 1) the return of the supremacy of the rule of law to the American government--which necessarily requires accountability for the lawbreakers from the buffoon's administration; real live humans on the Supreme Court; and 3) getting the fuck out of Iraq, yesterday. So, in my book, His Royal Highness Crown Prince Hussein (who is a black man, very near the white women, I might add) is doing fairly well. The fact that BushCo boot-lickers and the klansmen-lite are upset about his very existence counts for bonus points in my estimation.
 
mr merlin

mr merlin

EOG Master
Re: The tax-and-spend Obama budget

4625 said:
As a Libertarian, I believe the most efficient government, political and economic system is the situation where everyone looks after their own self interest. As for myself and what I view as my own best self-interest, I don't give a rat's ass about the economy, taxes, government spending, blah, blah, blah; in the end, it will all come out just about the same. As I have stated numerous times here, I care about: 1) the return of the supremacy of the rule of law to the American government--which necessarily requires accountability for the lawbreakers from the buffoon's administration; real live humans on the Supreme Court; and 3) getting the fuck out of Iraq, yesterday. So, in my book, His Royal Highness Crown Prince Hussein (who is a black man, very near the white women, I might add) is doing fairly well. The fact that BushCo boot-lickers and the klansmen-lite are upset about his very existence counts for bonus points in my estimation.
Click to expand...
How many people in the world truly value your opinion 46? I would guess maybe 1 or 2...if you're lucky!
 
M

Munchkin Man

EOG Dedicated
Re: The tax-and-spend Obama budget

4625 said:
So, in my book, His Royal Highness Crown Prince Hussein (who is a black man, very near the white women, I might add) is doing fairly well.
Click to expand...

Greetings 4625:

As a published author and a former proofreader of mathematics textbooks, the Munchkin Man would like to offer you a friendly editorial suggestion

Specifically, the Munchkin Man would like to suggest that you dispense with the habitual use of your parenthetical expression above, which the Munchkin Man has highligted in bold print for your ease of identification.

In addition to its redundancy and lack of substantive meaning, your overuse of this expression has rendered it as hackneyed and trite.

You're welcome.

Best Wishes,

Munchkin Man
 
S

soli

EOG Dedicated
Re: The tax-and-spend Obama budget

Munchkin Man said:
Greetings 4625:

As a published author and a former proofreader of mathematics textbooks, the Munchkin Man would like to offer you a friendly editorial suggestion

Specifically, the Munchkin Man would like to suggest that you dispense with the habitual use of your parenthetical expression above, which the Munchkin Man has highligted in bold print for your ease of identification.

In addition to its redundancy and lack of substantive meaning, your overuse of this expression has rendered it as hackneyed and trite.

You're welcome.

Best Wishes,

Munchkin Man
Click to expand...

I really don't see anything wrong with that since you don't see anything wrong with BCTTWR redundancy of calling the President "a piece of shit"(who is a black man, very near the white women, I might add) 12io4j2w90

P.S. I think that will be a line that I might start using myself.
 
4625

4625

2
Re: The tax-and-spend Obama budget

Munchkin Man said:
Greetings 4625:

As a published author and a former proofreader of mathematics textbooks, the Munchkin Man would like to offer you a friendly editorial suggestion

Specifically, the Munchkin Man would like to suggest that you dispense with the habitual use of your parenthetical expression above, which the Munchkin Man has highligted in bold print for your ease of identification.

In addition to its redundancy and lack of substantive meaning, your overuse of this expression has rendered it as hackneyed and trite.

You're welcome.

Best Wishes,

Munchkin Man
Click to expand...

1) I welcome the poster running the "bit" known as Munchkin Man to the club of "published authors;"
2) As a "published author," the poster running the "bit" known as the Munchkin Man should realize that repetition is a stylistic device;
3) Methinks the poster running the "bit" known as Munchkin Man doth protest too much, as we all know the parenthetical has a meaning of paramount importance to a certain subset of the big southern dummy who shows a predilection for gas-cans, big wooden crosses, and white-sales at Wal-Mart. 12io4j2w90
 
B

BCTTWR

EOG Dedicated
Re: The tax-and-spend Obama budget

4625. How can you consider yourself a libertarian? You are defending this piece of shit? The leaders of your party think Obama is destroying the USA.
 
4625

4625

2
Re: The tax-and-spend Obama budget

4625 said:
As a Libertarian, I believe the most efficient government, political and economic system is the situation where everyone looks after their own self interest. As for myself and what I view as my own best self-interest, I don't give a rat's ass about the economy, taxes, government spending, blah, blah, blah; in the end, it will all come out just about the same. As I have stated numerous times here, I care about: 1) the return of the supremacy of the rule of law to the American government--which necessarily requires accountability for the lawbreakers from the buffoon's administration; real live humans on the Supreme Court; and 3) getting the fuck out of Iraq, yesterday. So, in my book, His Royal Highness Crown Prince Hussein (who is a black man, very near the white women, I might add) is doing fairly well. The fact that BushCo boot-lickers and the klansmen-lite are upset about his very existence counts for bonus points in my estimation.
Click to expand...

I don't have any "leaders" and the passage above explains my thoughts on the matter.
 
B

BCTTWR

EOG Dedicated
Re: The tax-and-spend Obama budget

4625, Do you know what libertarian means? You say Obama is doing fairly well? My god man, take off the blinders. Bush was an incompetent buffoon. Obama is dangerous.
 
brucefan

brucefan

EOG Dedicated
Re: The tax-and-spend Obama budget

Hows that PAYGO workin out for us?
:+clueless
Dems scale back bill to woo votes for jobless aid

Deadline for jobless benefits nears as Dems struggle for votes on tax and spending package


WASHINGTON (AP) -- Democrats are struggling to extend unemployment benefits before they go on vacation next week as they work to ease concerns among jittery lawmakers being hammered over deficit spending.
House leaders hope to vote Thursday on a bill that would extend the benefits through November, but they are running into opposition from Republicans and some Democrats concerned about the cost of the overall bill.
The benefits are part of a sweeping package of unfinished business that lawmakers hope to complete before their Memorial Day recess.
Democratic leaders cut the cost of the legislation Wednesday by more than $50 billion -- to about $140 billion -- in an attempt to pick up votes. The bill would add about $84 billion to the federal budget deficit.
It's a tough vote for lawmakers who want to help constituents hit hard by the recession but are wary of being labeled big spenders. The economy is starting to pick up, but unemployment is still high as the nation continues to struggle from the loss of more than 8 million jobs. At the same time, angst over deficit spending is growing as midterm congressional elections near in November.

If we could only get that damm unemployment rate down:doh1

And where is that money coming from again???
:devil:


http://finance.yahoo.com/news/Dems-...60.html?x=0&sec=topStories&pos=6&asset=&ccode=
 
brucefan

brucefan

EOG Dedicated
Re: The tax-and-spend Obama budget

What a shock, another one running for the exit door



Obama Budget Director Peter Orzsag Is Out, Becomes First Economic Adviser To Bail



Submitted by Tyler Durden on 06/21/2010 20:46 -0500



The man singlehandedly responsible for the smallest, "biggest inconsistency" in US budgetary history (that whole $6.3 billion in GSE's left off the US balance sheet, for the full post read "Obama's budget has one small, missing piece... For $6.3 trillion"), Peter Orzsag, currently head of Obama' budget office and previously head of the Congressional Budget Office, and also responsible for the most ridiculous budget in US history (what is the most recent 2020 projected deficit: $100 trillion? $100 quadrillion? does anyone even care?) is out. Bloomberg reports: "White House Budget Director Peter Orszag plans to leave President Barack Obama?s Cabinet in July, before the White House begins preparing its next budget, administration officials said." This is arguably the biggest slap in the face of the administration's failed budgetary efforts: the rats are now openly jumping ship, knowing full well that the US will soon be ($20 billion in debt) underwater.



Orszag, 41, considered leaving his post as director of the Office of Management and Budget in April and stayed on after an appeal from the president, the officials, who spoke on condition of anonymity, said. Orszag?s decision to leave this summer will accelerate the process of picking a successor.

Orszag?s spokesman declined to comment directly on his plans. ?Peter?s focused on his work, not on Washington speculation,? said Kenneth Baer, the budget office?s communications director.

The departure comes as Obama is putting his focus on slicing the federal deficit, forecast to reach a record $1.6 trillion this year. The president appointed a bipartisan panel to recommend ways to cut the shortfall, and its report is due in December.

Upon leaving the administration, Orszag will likely join a think tank, said one of the administration officials.
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Yup. Think Tank Sachs.
Here are the potential replacements:



Among the potential replacements under consideration are Laura Tyson, a former director of the National Economic Council under President Bill Clinton, and Rob Nabors, who served as OMB deputy director under Orszag before moving to the White House to work under Chief of Staff Rahm Emanuel, said one of the officials.
​
On the other hand, could Peter's departure have been mandatorily "voluntary"?



Earlier this month, Orszag announced a plan to force some federal agencies to reduce their fiscal 2012 budget requests by 5 percent to help cut the deficit.

?As stewards of the American people?s tax dollars, we cannot afford to waste money on programs that do not work, that are outdated or that are duplicative of one another,? he said in a speech on June 8 at the Center for American Progress.
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In other words dissent will not be tolerated comes to throwing away tens of billions. The penalty for fiscal prudence is testing the helicopter's eject seat mechanism.
http://www.zerohedge.com/article/ob...rzsag-out-becomes-first-economic-adviser-bail
 
brucefan

brucefan

EOG Dedicated
Re: The tax-and-spend Obama budget


NIA Projects Multi-Trillion Dollar U.S. Budget Deficits

Earlier this week, President Obama released the White House's budget proposal for fiscal year 2012 along with their budget projections for the following 10 years. The White House projects a record budget deficit in 2011 of $1.645 trillion, but for the deficit to be reduced to $1.101 trillion in 2012, $768 billion in 2013, $645 billion in 2014, and a low of $607 billion in 2015, before rising back up to $774 billion in 2021. We give Obama credit for being honest and admitting that he has no intention of making any attempt to balance the budget. However, NIA believes the White House is making ridiculous assumptions and deceiving the public about future budget deficits.

In our opinion, the White House will be right about the U.S. having a record budget deficit in 2011. Unfortunately, we believe this is the only thing they will be right about. Any proposed spending cuts coming out of Washington today are so small that they are a waste of time even discussing. The truth is, the total cost of Social Security, Medicare, Medicaid, and other mandatory programs alone will be $2.2 trillion in 2011. Then when you add in the projected $205 billion in interest payments on our national debt in 2011, we will have a budget deficit of $235 billion right there without including any of the government's $891 billion in security and $496 billion in non-security discretionary spending.

Obama's proposed freeze on non-security discretionary spending will only save $406 billion over the next 10 years, which is absolutely nothing. If Obama didn't just freeze discretionary spending, but he cut all discretionary spending down to zero, we would still have a budget deficit. Nobody in the mainstream media is educating the American public about just how dire our country's fiscal situation is. We get called fear-mongers for preparing Americans for hyperinflation, but we speak the truth while the mainstream media ignores our country's financial problems. We wouldn't have to spend close to a million dollars per year producing documentaries and writing articles about the hyperinflationary crisis ahead if the mainstream media did their job.

NIA believes that after our record budget deficit this year, there is a 99% chance that we will continue to see more record budget deficits in the years ahead. Even if 2012 or 2013 saw a minor dip in our budget deficit, we could see budget deficits that are double or triple their current level within the next few years. In fact, NIA doesn't think our nation will survive until 2021 based on the path we are currently on. The U.S. won't be able to continue printing money to monetize the debt and deficits, without seeing an outbreak of massive inflation and perhaps hyperinflation at some point this decade.

To reach the White House's projected reductions in the budget deficit after a record budget deficit in 2011, the White House is projecting that annual price inflation in the U.S. will rise from just 1.3% in 2011, to just 1.8% in 2012, 1.9% in 2013, 2% in 2014, and 2.1% per year from 2016 through 2021. NIA believes these numbers are unrealistic and that real price inflation in the U.S. is already north of 5%. NIA believes real price inflation is likely to rise above 10% in either the second half of 2011 or early 2012. The Federal Reserve has held interest rates at artificially low levels of 0% to 0.25% for over two years. Artificially low interest rates are very inflationary. In order to contain price inflation and keep it under control, the Federal Reserve must raise interest rates to above the real rate of price inflation. The Fed won't do this because it would destroy our phony economic recovery.

If the Federal Reserve never lowered interest rates and kept them at 5.25% where they were in 2006, instead of having 5% price inflation today, we would likely have at least 5% price deflation. This means inflation is now conservatively 10% higher than where it would have been without the Federal Reserve's destructive actions. To put this into perspective, with three years of 5% price inflation, a product becomes 35% more expensive than it would have been with three years of 5% price deflation.

The U.S. Bureau of Labor Statistics (BLS) reported yesterday that year-over-year price inflation in the month of January was 1.63%, compared to 1.5% in December. Even based on the phony BLS numbers, it is obvious to all that price inflation in the U.S. is accelerating. NIA estimates that real price inflation is now closing in on 6%.

Not only is the White House budget using deceptive inflation numbers, but it is also misleading Americans about GDP growth. The White House budget is projecting 5% annual nominal GDP growth over the next 10 years. Over the past decade, the U.S. has seen an average annual nominal GDP growth rate of 3.95% and if you go back to the years 2001-2005 during the Real Estate bubble, we saw annual nominal GDP growth during those five years of 4.86%.

It is absolutely insane for the White House to be projecting nominal 5% GDP growth per year, with inflation of only 2% per year. There is absolutely no chance of the U.S. economy seeing real GDP growth of 3% per year, which would be higher than our average real GDP growth during the biggest artificial boom in U.S. history. In our opinion, any GDP growth the U.S. sees this decade will be created entirely by inflation. Considering that the White House expects there to be a lot of GDP growth in the years ahead, they are clearly putting a lot of pressure on Federal Reserve Chairman Ben Bernanke to create as much monetary inflation as possible.

As part of the White House's budget projections, they also project unemployment in the U.S. to decline from an average of 9.6% in 2011 to a low of 5.3% in years 2016 through 2021. Real unemployment in the U.S. today, after accounting for both short and long-term discouraged workers, is now approximately 22%. Between federal, state, and local government workers, government employees now make up 16% of all U.S. payrolls. Over the past 60 years, government employment growth has just about doubled the rate of U.S. population growth. During the upcoming hyperinflationary crisis, we could very easily see the number of government employees cut in half, which would send the official U.S. unemployment rate up to 16% and the real unemployment rate up to 29%.

The biggest problem NIA has with the White House budget is their projections for interest payments on our national debt. Historically, going back the past 50 years, yields on the 10-year bond have averaged about 7.2%. The 10-year bond yield has been skyrocketing in recent months and is currently 3.57%, up from being 2.381% on October 8th of last year. With the 10-year bond yield surging 50% over the past four months, there is no reason the yield can't surge another 50% over the next six to twelve months up to 5.36%. Yet, the White House is projecting the bond yield to average 3% in 2011 and to rise to only 3.6% in 2012, 4.2% in 2013, and up to a high of 5.3% for years 2017 to 2021. Trust us, if interest rates on the 10-year bond don't rise to 5.3% within the next six to twelve months, we guarantee they will still do so a lot closer to six months than six years.

With treasury yields having been held at artificially low levels for so long, we expect them to rise above historically average levels and remain there for many years. There is no doubt that we will see bond yields back above 7.2% in the years ahead. As inflation begins to spiral out of control, we expect to see bond yields rise to above 10% and beyond. The White House doesn't expect interest payments on our national debt to rise above $500 billion until the year 2015. They're projecting net interest payments in 2015 of $505 billion with our public debt averaging the year around $13.9 trillion. In order words, they expect us to pay only 3.6% interest on our debt that year.

To summarize, Obama expects our budget deficit to decline from $1.645 trillion this year down to a low of $607 billion in 2015 by having 5% per year GDP growth, only 2% per year inflation, unemployment in 2015 of only 5.9%, and an overall interest rate that is only 1/2 of historical 10-year treasury yields. NIA projects that the U.S. will see zero GDP growth adjusted for inflation and if we are right, and we also see the U-3 unemployment rate rise back above 10% along with our overall interest rate on our debt rising back to historical levels of 7.2%, our actual deficit in 2015 could very easily surpass $3 trillion.

In early 2008, the Bush Administration was projecting the U.S. budget deficit to decline to $160 billion in 2010, $96 billion in 2011, and for the U.S. to have a $48 billion surplus in 2012. Look how easily a $96 billion projected deficit turned into a $1.645 trillion deficit, 17 times higher than projected. It is nearly impossible to reduce budget deficits once they begin spiraling out of control, unless the government acted to dramatically slash spending by 50% or more in all areas of the budget including the so-called untouchable areas like Social Security, Medicare, and Medicaid. Obama pledged while running for President to cut the budget deficit in half during his first term, but it has so far increased by 262%. If we have just a few more years of trillion dollar plus budget deficits, interest payments on our national debt will begin to approach half of U.S. government tax receipts and at that point, hyperinflation will be all but guaranteed
 
brucefan

brucefan

EOG Dedicated
Re: The tax-and-spend Obama budget

Do I post these in the Obama lies thread, or the tax and spend budget thread??? So tricky, just not sure


All while the lapdog media, just sleeps

Obama?s Budget Deception Continues
President Obama in a speech this morning continued to deceive Americans about his proposed budget when he said it will bring domestic spending down to its lowest share of our economy since Dwight Eisenhower was President.

The actual type of spending Obama is referring to is ?non-security discretionary spending? and he is projecting it to decline as a percentage of GDP to Eisenhower levels by the year 2015. Obama projects ?non-security discretionary spending? to decline to $402 billion in 2015, which would be 2.1% of his projected GDP that year of $18.804 trillion, a projected decline from 3.4% of GDP in 2011 and 2.9% in 2012. For comparison purposes, Obama claims that ?non-security discretionary spending? during the Eisenhower administration was 2.2% of GDP.

However, the White House didn?t keep track of ?non-security discretionary spending? during the Eisenhower administration and the actual figures the White House is using for the Eisenhower administration is ?non-defense discretionary spending?, a big difference. The White House is comparing apples and oranges because a large part of our military budget gets spent overseas on ?offense? and not homeland security ?defense?.

?Non-defense discretionary spending? includes overseas war spending while ?non-security discretionary spending? does not, meaning ?non-defense discretionary spending? is an automatically higher number than ?non-security discretionary spending?.

Being a higher number, ?non-defense discretionary spending? is automatically a higher percentage of GDP than ?non-security discretionary spending?. Therefore, the percentage of GDP figure that the White House is using for the Eisenhower administration is artificially high. Real ?non-security discretionary spending? as a percentage of GDP during the Eisenhower administration was likely much lower than 2.2%.

NIA believes the White House is also being overly optimistic in its projections that GDP will grow nominally by 4.9% in 2012, 5.95% in 2013, 6.1% in 2014, and 5.7% in 2015. These projected GDP growth numbers are substantially higher than U.S. GDP growth during the middle of last decade, when the U.S. economy was growing because of the Real Estate bubble, the largest artificial boom in U.S. history. There will be no more bubbles this decade that can artificially inflate the U.S. economy. The U.S. is almost guaranteed to see zero GDP growth adjusted for the real rate of inflation. If it wasn?t for the Federal Reserve leaving interest rates near zero for over two years and printing trillions of dollars out of thin air, the U.S. would be experiencing record deflation with GDP contracting by more than 5% annually.

In conclusion, non-security discretionary spending is absolutely meaningless because in fiscal year 2011 it is accounting for only 13% of total government outlays. Medicare spending alone is higher than all non-security discretionary spending items combined and by the year 2015, NIA projects just the interest payments on our national debt to rise to a level that is higher than non-security discretionary spending.
http://inflation.us/blog/2011/02/oba...ion-continues/
 
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