President Obama's Really Bad Idea: Sequester
The ARRA News Service does not endorse or advertise other publications. However, the editor does follow and read other excellent sources and publications. One of those is The Patriot Post. Today they kicked off their Friday Digest with the following excellent article which is shared and linked to below. We appreciate The Patriot Post and all those who are co-laborers in the field of of freedom and liberty.
The multiplication of public offices, increase of expense beyond income, growth and entailment of a public debt, are indications soliciting the employment of the pruning knife." --Thomas Jefferson by The Patriot Post Editors: Proposed by Barack Obama and signed into law by Barack Obama, the sequester -- automatic spending "cuts" of $85 billion that will kick in March 1 -- is now the only thing standing between us and a prosperous future. So says Barack Obama.
In his State of the Union address, Obama complained, "These sudden, harsh, arbitrary cuts would jeopardize our military readiness, they'd devastate priorities like education and energy and medical research. They would certainly slow our recovery and cost us hundreds of thousands of jobs. And that's why Democrats, Republicans, business leaders and economists have already said that these cuts -- known here in Washington as 'the sequester' -- are a really bad idea."
His really bad idea. In fact, last year he even threatened a veto of any attempt to undo it.
In truth, these supposedly devastating "cuts" are merely reductions in budgetary spending increases that are called "cuts" by the Democrats and the Leftmedia. They're designed to convince Republicans to cave on tax hikes, but many Republicans have simply resigned themselves to sequestration as the only hope for slowing the growth of government during Obama's presidency. House Republicans did pass a bill last year to replace most of the defense cuts with cuts to food stamps and other redistribution programs, and Senate Democrats aim to replace it with a 50/50 proposal of $120 billion in spending cuts and tax hikes. The "cuts" would come from agriculture subsidies and defense, while the tax revenue would come from implementing the "Buffett Rule" -- ensuring that millionaires pay at least 30 percent in taxes. But neither plan is likely to go anywhere.
Fortunately, Democrats tell us, we don't have a spending problem. As House Minority Leader Nancy Pelosi (D-CA) explained, "[I]t isn't as much of a spending problem as it is a priorities, and that's what a budget is, setting priorities." No immediate reply from Senate Majority Leader Harry Reid (D-NV), whose chamber hasn't bothered to pass a budget in four years. Pelosi continued, "[I]t is almost a false argument to say that we have a spending problem. We have a budget deficit problem." She didn't elaborate on how those are different things.
Her right-hand man, Minority Whip Steny Hoyer (D-MD), added his voice to the chorus, saying, "Does the country have a spending problem? The country has a paying for problem. We haven't paid for what we bought, we haven't paid for our tax cuts, we haven't paid for war." Um, that's called a spending problem. No matter, Hoyer blames Bush: "[W]e spent a lot of money when George Bush was president of the United States and the House and Senate were controlled by Republicans. We spent a lot of money." Indeed we did -- far too much -- but Democrats "solved" that problem by doubling, tripling and quadrupling spending.
Well, what about revenue? The Congressional Budget Office predicted this week that federal revenue will reach $2.7 trillion in 2013, returning to pre-recession levels and setting an all-time record for revenue collection. Revenue dipped to $2.1 trillion at the low point of the recession in 2009, but it has risen steadily since. It's important to recognize that the CBO estimate is based on a simple static calculation that assumes the recent tax hikes will produce a specific dollar amount in tax revenue. But this tit-for-tat theory never seems to work as anticipated.
Proven time and again, the higher tax rates go, the less revenue is actually brought in. That's because higher tax rates adversely affect investments, business growth, hiring and consumer spending. Taxes are punitive measures that restrict economic behavior, forcing individuals and businesses to curb their activity. In the long run, excessive taxes lead to less capital in circulation from which the government can skim off the top.
The CBO's assertion that federal revenue could reach an all-time high in 2013 runs counter to the leftist claim that Washington has a revenue problem. If the government collects more money than it ever has in history and it still doesn't have enough cash to cover the budget, we're back where we started: The problem is one of spending.
Yet leftists continue to call for more money, exhibiting not one bit of shame for their spendthrift ways. Taxing the rich won't bridge the gap; it won't even come close. Indeed, the unquenchable NeoCom appetite for other people's money has already materialized into more taxes on the middle class.
Republicans pledge to not raise taxes once again to avoid the March 1 sequester, and together with Democrats' refusal to discuss real spending cuts, any chance of making a replacement deal is slim. There's a lot of talk about closing tax loopholes and drafting last-minute legislation to postpone sequestration, but this is nothing more than spending junkies living in denial. Like an alcoholic who thinks it's okay to take one last drink before quitting, Washington has deluded itself into thinking that it can go on avoiding cuts indefinitely.
Keen Sense of the Obvious - "At some point you run out of money." --Barack Obama
Tags: The Patriot Post, President Obama, bad idea, uncontrolled sequester, government spending To share or post to your site, click on "Post Link". Please mention / link to the ARRA News Service. Thanks!
In his State of the Union address, Obama complained, "These sudden, harsh, arbitrary cuts would jeopardize our military readiness, they'd devastate priorities like education and energy and medical research. They would certainly slow our recovery and cost us hundreds of thousands of jobs. And that's why Democrats, Republicans, business leaders and economists have already said that these cuts -- known here in Washington as 'the sequester' -- are a really bad idea."
His really bad idea. In fact, last year he even threatened a veto of any attempt to undo it.
In truth, these supposedly devastating "cuts" are merely reductions in budgetary spending increases that are called "cuts" by the Democrats and the Leftmedia. They're designed to convince Republicans to cave on tax hikes, but many Republicans have simply resigned themselves to sequestration as the only hope for slowing the growth of government during Obama's presidency. House Republicans did pass a bill last year to replace most of the defense cuts with cuts to food stamps and other redistribution programs, and Senate Democrats aim to replace it with a 50/50 proposal of $120 billion in spending cuts and tax hikes. The "cuts" would come from agriculture subsidies and defense, while the tax revenue would come from implementing the "Buffett Rule" -- ensuring that millionaires pay at least 30 percent in taxes. But neither plan is likely to go anywhere.
Fortunately, Democrats tell us, we don't have a spending problem. As House Minority Leader Nancy Pelosi (D-CA) explained, "[I]t isn't as much of a spending problem as it is a priorities, and that's what a budget is, setting priorities." No immediate reply from Senate Majority Leader Harry Reid (D-NV), whose chamber hasn't bothered to pass a budget in four years. Pelosi continued, "[I]t is almost a false argument to say that we have a spending problem. We have a budget deficit problem." She didn't elaborate on how those are different things.
Her right-hand man, Minority Whip Steny Hoyer (D-MD), added his voice to the chorus, saying, "Does the country have a spending problem? The country has a paying for problem. We haven't paid for what we bought, we haven't paid for our tax cuts, we haven't paid for war." Um, that's called a spending problem. No matter, Hoyer blames Bush: "[W]e spent a lot of money when George Bush was president of the United States and the House and Senate were controlled by Republicans. We spent a lot of money." Indeed we did -- far too much -- but Democrats "solved" that problem by doubling, tripling and quadrupling spending.
Well, what about revenue? The Congressional Budget Office predicted this week that federal revenue will reach $2.7 trillion in 2013, returning to pre-recession levels and setting an all-time record for revenue collection. Revenue dipped to $2.1 trillion at the low point of the recession in 2009, but it has risen steadily since. It's important to recognize that the CBO estimate is based on a simple static calculation that assumes the recent tax hikes will produce a specific dollar amount in tax revenue. But this tit-for-tat theory never seems to work as anticipated.
Proven time and again, the higher tax rates go, the less revenue is actually brought in. That's because higher tax rates adversely affect investments, business growth, hiring and consumer spending. Taxes are punitive measures that restrict economic behavior, forcing individuals and businesses to curb their activity. In the long run, excessive taxes lead to less capital in circulation from which the government can skim off the top.
The CBO's assertion that federal revenue could reach an all-time high in 2013 runs counter to the leftist claim that Washington has a revenue problem. If the government collects more money than it ever has in history and it still doesn't have enough cash to cover the budget, we're back where we started: The problem is one of spending.
Yet leftists continue to call for more money, exhibiting not one bit of shame for their spendthrift ways. Taxing the rich won't bridge the gap; it won't even come close. Indeed, the unquenchable NeoCom appetite for other people's money has already materialized into more taxes on the middle class.
Republicans pledge to not raise taxes once again to avoid the March 1 sequester, and together with Democrats' refusal to discuss real spending cuts, any chance of making a replacement deal is slim. There's a lot of talk about closing tax loopholes and drafting last-minute legislation to postpone sequestration, but this is nothing more than spending junkies living in denial. Like an alcoholic who thinks it's okay to take one last drink before quitting, Washington has deluded itself into thinking that it can go on avoiding cuts indefinitely.
Keen Sense of the Obvious - "At some point you run out of money." --Barack Obama
Tags: The Patriot Post, President Obama, bad idea, uncontrolled sequester, government spending To share or post to your site, click on "Post Link". Please mention / link to the ARRA News Service. Thanks!
Posted by Bill Smith at 2:20 PM - Post Link
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