Transportation Overload

“Stop messing with my man, and that includes his ride.  Matter of fact, wax that m_______f_______, give it a tuneup.”

            —Faizon Love as Jamal Jackson in The Replacements

 

You’d better sit down for this one.

The Daily Mail reports that the Pentagon has put out a contract to Connecticut-based Sikorsky Aircraft Corporation—makers of the Blackhawk, among other things—to replace Marine One, the helicopter used to transport the President.  Why I’m having to get this information from a British news outlet is another article entirely, but that’s not what got my attention.

So what’s the big deal, Rusty?  These things do have to be upgraded and replaced from time to time.

Quite true.  But here’s the thing:  “Marine One” isn’t a specific aircraft, it’s a designation applied to the helicopter the President happens to be on.  In other words, there’s more than one such helicopter.  Even that in itself isn’t such a big deal, nor is it even particularly surprising.  But this is:

The current Presidential helicopter fleet serving as Marine One includes nineteen aircraft.

You read that right.  Nineteen.

And no, that’s not “over the years nineteen different helicopters have served as Marine One.”  That’s right now, all together, at one time, the President has nineteen different helicopters from which to choose.

That’s enough for Obama, the First Lady, both daughters, the First Dog, and every one of Obama’s golf clubs including his putter (assuming—snicker—he follows the rules and plays with the limit of 14) each to have their own chopper to ride to Martha’s Vineyard this summer.  The fleet includes eleven Sikorsky VH-3Ds at an original pricetag of about $6.5 million apiece (about $24 million in today’s dollars), and another eight Sikorsky VH-60Ns at an original price of about $10.6 million ($15.3 million in today’s dollars).  Nineteen helicopters with a total sticker price of just over $156 million in nominal dollars, $386 million in today’s money.

Huh?

I get it that the President has to have transportation and sometimes helicopter is the only practical and efficient way to get it done.  I get it that the President’s vehicles should project a sense of national prestige.  I get it that they would need specialized security, communications, and other features to enable the President to do his job—were he so inclined—while aboard.  And I don’t even begrudge having it decked out with accoutrements and comforts commensurate with the office.  You might even be able to justify having more than one, you know, for a backup or decoy.

But nineteen of them?

To put this in a little perspective, Her Majesty Queen Elizabeth II of England has exactly one helicopter, and most royal family travel is via British Airways.

You can add to the nineteen helicopters the two Boeing VC-25s (military versions of the 747) that serve as Air Force One at a cost of $325 million apiece ($685 million in today’s money), and the emergency “doomsday” Boeing E-4B (also a 747, and the Air Force actually has four of them, but I’ll only count one for our Presidential purposes today) that spends almost all its time sitting idle at a purchase price of $223 million (another $322 million in today’s dollars).  Oh, yeah, there’s also the $40 million+ Presidential Gulfstream 500 for more pedestrian excursions like taking the wife for a date night fling in NYC. That’s a Presidential air wing of nineteen helicopters and three 747s, totaling about $1.7 billion in current money.

Imelda Marcos’ shoe collection starts to pale in comparison.

To return to the initial subject, the Pentagon is looking to replace the helicopter fleet.  But apparently nineteen helicopters isn’t enough—the new contract is for a total of twenty-three new choppers, at an estimated cost of about $400 million . . .

. . . wait for it . . .

. . . APIECE.

That’s right, the Pentagon is not only going replace the Presidential helicopter collection and in the process expand it from 19 to 23, but each one is going to cost more than the 747s that serve as Air Force One.  In total, the new Presidential helicopter armada will cost $20 billion.  To put that in perspective, USS George H.W. Bush (CVN 77)—a freaking nuclear aircraft carrier— commissioned in 2009 only cost $6.2 billion, and she is expected to have a service life of at least 50 years.  Hell, even converted to current money, an average Apollo moon landing cost less ($18.5 billion) than this new set of Presidential travel toys.

In fairness, I don’t think this particular excess can be laid on Obama.  I expect what you see today is really the culmination of a trend/practice that dates back to at least Nixon, and the latest installment of rotary wing gems won’t enter service until Obama is long gone.  But it’s only half of the equation.  The other half is the serial abuse of this perk of the office for personal benefit, and that you can squarely lay at Obama’s feet.

Consider that the operating cost of Air Force One is a little over $220,000 per flight hour.  That’s just the airplane, and does not factor in the hoardes of security personnel, motorcades and associated transportation—all those armor-plated SUVs have to be flown to destination in a C-130—etc. that go with Presidential travel.  I could not find operating cost information for Marine One, but we can see that, for example, the VH-3D (the Presidential version of the “Sea King”) consumes on average about 1,050 pounds (about 156 gallons) of fuel per hour (not exactly “green”); at an average of $6.50 per gallon in the D.C. area, that’s just over $1,000 an hour just in gas.  The bottom line is, it’s really, really expensive to travel in these things.

With that expense in mind, think about what this President has been doing.  Since his re-election—in other words, since the time he no longer had another election to worry about ever again—the President has attended at least 45 Democrat Party fundraisers, many in places like L.A., Chicago, New York, and Houston.  He is committed to at least 18 such events in 2014 alone.  He and his entourage fly to all these things on the public dime.

The Obamas’ fetish for impossibly lavish (and frequent) vacations is well-documented.  But recall that part of that practice is their habit of flying separately.  They have even been known to enlist a separate flight for their dog to join them.  But even traveling together, the cost is enormous.  For example, their annual end-of-year sojourn to Hawaii involves about 19 hours round trip flight time, meaning the First Family air bill alone is well over $4 million.

As Judicial Watch has chronicled–and had to fight tooth and nail in the federal courts to obtain the relevant documents–there have been Presidential golf weekends in places like Palm Springs, Key Largo, and West Palm Beach, again involving millions of public dollars in travel expenses.  There have of course been the First Lady’s (and daughters’) separate trips to Spain, Africa, China, Aspen.  There have been the dubious “official” trips to places like Dublin and Copenhagen.  And on and on.

All of these things cost money.  A lot of money.   Between the gigantic fleet and its insatiable operating costs, we are now spending literally billions of dollars ferrying the Chief Executive and his family—and all the attendant security, staff, hangers-on, posse, etc.—all over the planet.  Some of that travel is legitimate.  And I don’t even begrudge the occasional boondoggle—if the G-8 is meeting in Paris and you want to save a seat on Air Force One so the First Lady can fly over and tour the Louvre, that’s not a big deal.

But way too much of what we now see—and pay for—is plainly not legitimate travel necessary as part of the President’s job as an employee of the United States.  And the size of the fleet used to do it is unconscionable.  Yet there is no adult watching over the candy store.  Oh, sure, there are a handful of voices shouting in the wind, but there is no meaningful oversight to say “No, that’s too much.”

We should all be contacting our Congressman to ask for some kind of inquiry into the necessity of having two dozen $400 million helicopters, three 747s, and however many Gulfstreams reserved for Presidential transport, and placing some sort of governing mechanism to police their use at public expense.

Or at least ask for a ride.

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Can You Hear Me Now?

Edwards:       Drop the weapon and put your hands on your head.

K:                    I warned him.

Edwards:       Drop the weapon!

K:                    You warned him.

Edwards:       Don’t make me kill you.

Jeebs:              You insensitive prick!  Don’t you know how much that stings!

—Will Smith as Edwards, Tommy Lee Jones as K, and Tony Shalhoub as Jack Jeebs in Men In Black

OK, everybody who’s surprised by the colossal failure of the rollout of FUBARCare raise your hand.

Mr. Obama, you can put yours down.

Amazingly, the Progressives are still trying with a straight face to defend this thing, and some are even having the brass stones to blame Republicans for the problems.  But by now it is impossible for any remotely rational person not to see what a pack of lies this has been:

But the FUBARCare debacle over the last week is hardly surprising; to the contrary, it was utterly predictable, because it is merely the most recent illustration of this Administration’s consistent display of incompetence and deceit.  Indeed, is there anything this Administration has touched that hasn’t turned out to be a gigantic steaming pile of cow flop covered with (f)lies?

Afghanistan

The primary goal of our military involvement in Afghanistan was to “get” Osama Bin Laden.  That was achieved—in Pakistan—on May 2, 2011, over two and a half years ago, yet Americans are still dying in Afghanistan.  At last count, over 700 Americans—more than during the entire Bush administration—have been killed there since Bin Laden’s death.  Why?  Perhaps if Obama attended a security briefing once in awhile he’d be aware that our armed forces are still engaged in that theater.

Benghazi

On September 11, 2012, four Americans, including Ambassador Chris Stevens, were killed in a series of military-style assaults on our consulate—sovereign U.S. soil—in Benghazi, Libya.  Although Stevens had repeatedly warned of the deteriorating situation and requested additional security, although escalating incidents over the preceding several months had led the British to close their facility, and although the 9/11 anniversary posed an obvious symbolic targeting date, the Administration refused to bolster security and left the diplomatic personnel in place.  Although the President knew about the attacks less than 90 minutes after they began, and although they took place over a period of some nine hours as the President and his staff watched in real time via surveillance drone, the President did nothing.  That weekend, Obama sent U.N. Ambassador Susan Rice all over the Sunday talk shows with a series of talking points blaming a silly internet video when they knew it was an al-Qaeda affiliated terrorist assault, while he ran around to multiple campaign fundraisers.  Obama later pledged to hunt down those responsible and bring them to justice, yet to date the only person jailed as a result has been the producer of the irrelevant internet film (who just recently got out of prison); no one in Libya has been arrested, and the Benghazi raid isn’t even among the crimes for which the Administration is offering a reward for information.

Economy and Budget

We’ve been told for several years now that we’re in a “recovery” from the Bush recession.  Obama has repeatedly said that he was focused like a laser on jobs, and that he “will not rest” until everyone has one.  Yet as of September, a full ten million people have left the workforce since Obama took office.  Workforce participation is now at a paltry 63%.  A recent Census Bureau report counts more people receiving means-tested government benefits (read: welfare) than with full-time jobs.  Meanwhile the national debt now exceeds $17 trillion, nearly double what it was when Obama took office (just under $10 trillion), Obama is continuing to spend at around a $4 trillion/year clip, and Harry Reid says “everybody” wants to pay more in taxes.

This is some rescue.

Fast & Furious

On December 14, 2010, U.S. Border Patrol agent Brian Terry was killed in a gun battle with Mexican drug runners.  Guns used in the fight were traced back to Operation Fast & Furious, a Justice Department action in which illegal guns were deliberately permitted to be sold and transported outside the U.S. in an effort to track them to Mexican cartels.  Despite multiple memos and emails to Attorney General Eric Holder mentioning the program—including some from before Terry’s murder—Holder has steadfastly denied (read: lied) knowing anything about it.  Since then, he and the President have spent the better part of the last three years doing everything possible to avoid providing Congress, the American people, or the Terry family any information about it.

Government “Investments”

Obama the investment banker, in his infinite wisdom, illegally diverted $80 billion in TARP bailout money effectively to nationalize GM and Chrysler.  On the GM side alone, taxpayers are still out nearly $20 billion, and the GM stock still held by the government would have to triple in value for John Q. Public just to break even.  To put that in perspective, the first time in our entire history that the total federal budget reached $20 billion was 1942, and here we’re talking about the loss on a single piece of a single program.  Meanwhile as I have reported previously, Obama’s Energy Department has lost billions making high-risk loans to unproven “green energy” firms—many, not coincidentally, owned by huge Obama donors—that have gone belly-up.  And the few jobs “created” through the bailout and loans have in large part been overseas.  Not a particularly good rate of return.

IRS & NSA

When the IRS hasn’t been gearing up to serve as the jack-booted enforcers of FUBARCare, it turns out they’ve been selectively targeting conservative political groups to delay or deny them tax-exempt status.  Originally passed off as the isolated action of a couple of rogue low-level employees in Cincinnati, it is becoming increasingly clear that this was actually a deliberate program to weaponize the IRS as a political tool for the Left, overseen at the highest levels.  Meanwhile, we’re learning that the NSA has been—without a warrant—effectively spying on millions of innocent private U.S. citizens.  Once again, however, the Administration absolutely refuses to discuss either issue with Congress or the American people.

World Image

Obama took office pledging to restore America’s image in the world.  Then in his first official act, he embarked on a global apology tour, basically denouncing everything America has ever been or done.  Since then, he has displayed a breathtaking lack of leadership in the Middle East, he’s been horrifyingly weak in dealing with Russia, and he’s alienated and offended our European and Western Hemisphere allies by repeatedly getting caught spying on them (compounded by the fact that he never sits down with those leaders one-on-one to foster those relationships).  The Saudis have recently severed diplomatic ties.  And Obama’s relationship with Israel is so deteriorated that one suspects the only circumstance in which he wouldn’t piss on Benjamin Netanyahu is if the Prime Minister were on fire.  If there is left any nation that would count us as a friend, or at least acknowledge any respect for us, I don’t know who that would be.

At this point the grim reality has to be inescapable.  Even the true believers on the Left can’t avoid recognizing—without engaging in an unconscionable self-fraud—that this President is an embarrassingly epic failure.  He has accomplished exactly nothing positive, and the level of arrogance, ignorance, incompetence, and paranoia that permeates this Administration is unlike anything we’ve ever seen.  At the end of the day, we’re left with nothing but angry lectures, empty platitudes, cheesy staged political stunts, fundraisers, and golf.

And lies.  Upon lies.  Upon lies.

This is what you get when you elect a community organizer with literally zero real-world experience, whose sole drivers are a blind adherence to radical ideology, and a limitless thirst to erect a monument to his own ego, real-world results and consequences be damned.

Some of us tried to tell you . . .

Gold Rush

“You’ll get nothing, and like it”!

            —Ted Knight as Judge Smails in Caddyshack

 

I told you this was coming.

The Obama administration yesterday—two months late, in violation of federal law (again)—released its proposed 2014 budget.  Among the highlights, it calls for total spending of $3.8 trillion.  Yet despite adding a new “Buffett Rule” tax requiring a minimum 30% contribution from those earning $1 million or more, and cutting (actually slowing the increases in) Social Security spending, still doesn’t balance.  As in 2012, and in 2011, I don’t expect this proposal to get any votes for passage from either Republicans or Democrats, so the likelihood of this coming to fruition this year is low.  But buried in there is a nugget I’ve warned you about and it bears watching.

You’ve probably seen the money grab over in Cyprus the last couple of weeks.  To recap, Cypriot banks—almost entirely government-owned—were over-exposed to Greek debt, such that the Cypriot economy was unable to withstand the negative impacts of European Union measures to deal with the debt crisis there.  Facing collapse, as a condition for a bailout the EU forced the closure of the second-largest bank, consolidation into the largest bank, with the result that depositors with holdings above the €100,000 cap may lose as much as 60% of their accounts.  In essence, the EU compelled the government of Cyprus to confiscate over half of many people’s savings.

Yeah, Rusty, but that’s Cyprus.  I can’t even find Cyprus on a map.  That kind of thing could never happen here.

Think again, Amigo.     

Among the proposals in the President’s budget is a cap on 401(K) savings.  Savings in retirement accounts like 401(K) and IRA devices above $3 million would no longer be eligible for tax advantaged treatment.  Currently, money deposited in those sorts of accounts—up to annual limits—is deposited on a pre-tax basis, and that money can sit there and accumulate interest or other investment growth tax free; the money then gets taxed as income as it is withdrawn in retirement.  What the President wants to do is go ahead and tax—read: take—that money now.

It’s an irresistible temptation.  U.S. savers have accumulated some $10 trillion in these retirement accounts based on the government’s promise that they could deposit it and let it grow tax free, and then it would be taxed down the road as ordinary income when they withdrew it in retirement.  But like a 3-year-old on Christmas Eve, Obama simply can’t wait until Christmas morning to open the presents under the tree.  The problem is that isn’t the government’s money, and it isn’t money Santa Clause has brought Obama or even to you.   It’s your money, earned through your labor and investment of time, skill, and expertise.  And Obama wants it.

But Rusty, I don’t have $3 million in my 401(K), and I’m never going to have $3 million in my 401(K), so why should I care?

Well, if you don’t and aren’t, I (depending on your age and lifestyle goals) submit you may want to re-think your retirement plan given that the monetization of our debt through the printing of fiat money is in fact already taxing your savings by devaluing it, but that’s another article for another time.  But regardless of whether you do or don’t (or will or won’t) have $3 million in retirement, you should care very much about the President’s proposal.

And it should scare the crap out of you.  

You see, that $3 million figure isn’t pulled completely from thin air.  It’s actually the amount you would need—under current economic conditions—to purchase an annuity paying you $205,000 per year.  Why that number?

Because that’s the amount the Obama administration, in its infinite wisdom, has decided is a reasonable amount for you to live comfortably in retirement.  In other words, they want you to work and save your whole life, and then in the end they will tell you how much of your own money you should have to live on and the rest of it is subject to the government taking it.

Rusty, that’s what any tax is.

Quite so.  But here we’re not talking about the government taxing your current income; we’re talking about it taking from you a substantial chunk of your money you’ve spent a lifetime saving.  Time you can never, ever replace.  Moreover, it’s taking from you out of accounts the very same government set up the tax breaks to encourage you to accumulate savings in the first place.  At a time when progressives are arguing that Americans already don’t save enough such that we need a second Social Security system, why would you start altering the tax advantages to discourage savings?!? 

What incentive do you have to keep working once you’ve saved $ 2,999,999, if the government can take some or even all of every dollar you save thereafter?  Why would a business owner stay in business—and keep employing his employees?

And it’s naïve to think that because you don’t expect ever to reach the $3 million threshold that you’re immune to the taking.  Once we’re in a universe where government gets to decide how much of your savings you actually get to have based on what government determines is a reasonable retirement income for you, then all bets are off.  Today that’s $205,000.  Tomorrow it might be pegged to the median U.S. income (currently about $50,000).  Next week it might be the median income tied to average life expectancy at retirement.  For a male at 65, today that’s about 13 years; the present value of a $50,000 annuity for 13 years is about $612,000, and anything in your 401(K) above that would be subject to the government taking it.  Furthermore, once they can tax your 401(K) or IRA, it’s only a small additional step for them to tax your regular savings, your checking account balance, or the value of any other investments you might have.

Still feel safe?

Keep this in mind as the Leftists are also looking to take your guns.  The people in Cyprus were already effectively disarmed before the government came to take their money.

I’m just saying.

Now, if Obama thinks his judgment that $205,000 is a reasonable income for you, let’s see him put his money where his mouth is.  I suggest we see legislation that reduces the Presidential salary to $205,000, provides ex-Presidents with a $205,000 annual lifetime stipend, and requires them to surrender all other assets to the U.S. Treasury.

I’ll bet you a million dollars this President would never sign such a bill.  And if he did, he’d never comply with it.  Because it’s never about what’s reasonable; it’s about taking as much from you as possible to buy enough votes to keep him and his ilk living like kings on your nickel.

 

When Robin Hood Became King

“I got into broadcasting because I like to give.  Sometimes I found myself hurting from giving too much, and I’d say, ‘Stop it.’  I’m always gonna cherish this [humanitarian award, which he subsequently leaves in a taxi], and all of you.”

            —Bill Murray as Frank X. Cross in Scrooged

 

Ah, our Benevolent Leader is at it again, channeling his inner Bill Clinton to assure us that he feels our pain.  In an almost impossibly transparent and shallow gesture, the President announced last week that in order to show solidarity with federal workers being adversely impacted by the effects of budget sequestration, he would be returning 5% of his Presidential salary to the Treasury.

You know, because we’re all in this together.

Superficially this almost appears to be the right thing to do, and no doubt the sycophants in the media will fall all over themselves to praise this latest move by Obama The Great to try to unite the country behind “common sense” ideas and for him to be one with his subjects—er, citizens.  And a good many will believe it.  But a closer look reveals this to once again be nothing more than a crass, juvenile show of form over anything resembling substance.

Many federal workers are facing furloughs—periods of forced unpaid leave.  For some, these furloughs may stretch upwards of four weeks, and amount to a 20% pay cut.  So Obama, in all his empathy, volunteers to take a 5% cut in solidarity with their 20%.

Really?

Even workers losing only 10-12 days to furlough are taking about a 5% cut.  So what the President is doing with his little voluntary charade is essentially joining the least impacted of the furloughed federal workers.  In other words, he’s doing as little as he can possibly get away with to still claim the political brownie points.  But it’s really worse than that.

Recall that the President makes a salary of $400,000 per year, plus spending allowance, travel allowance, free lodging in a not-too-shabby joint, free security, free food, etc.  He’s doing more than OK; he’ll be the first to tell you that he’s in that lofty 1% he so loves to demonize, and he’s in exponentially better shape than the very best off of the federal workers being furloughed.  So his salary give-back is doing the least, but doing it from a position of having the most.

Take it a step further.  That $400,000—which is all he’s said he’d be giving back 5% of; he’s not even counting the perks—isn’t his whole income.  In fact, it’s just a little over half of his income.  Remember, he still draws royalties from his books about himself.  He and Michelle reported nearly $800,000 in income in 2011 (the last year for which information is available).  He’s not giving up one thin dime of that.  So that “5%” giveback is really only about 2.5% of his actual revenues.

The generosity and self-sacrifice almost moves you to tears, doesn’t it?

This is the same man who for years has lectured us at every opportunity about the need for the rich to “pay their fair share,” meaning contribute disproportionately more to the collective good than their less-well-off neighbors.  As a refresher:

July 25, 2011:

“Are we a nation that asks only the middle class and the poor to bear the burden after they’ve seen their jobs disappear and their incomes decline over a decade? . . . Before we ask seniors to pay more for Medicare, we should ask people like me to give up tax breaks that we don’t need and weren’t even asking for.”

April 11, 2012: 

“One in four millionaires pays a lower tax rate than millions of hardworking middle-class households . . . It’s just plain wrong that middle-class Americans pay a higher share of their income in taxes than some millionaires and billionaires.” 

January 2, 2013:

“Obviously, there is still more to do when it comes to reducing our debt.  And I’m willing to do more, as long as we do it in a balanced way that doesn’t put all the burden on seniors or students or middle class families, but also asks the wealthiest Americans to contribute and pay their fair share.” 

Time and again he has pounded this populist bullcrap about those with more—who already pay the vast, vast, vast majority of taxes—needing to do more still before they’ve reached their somehow-never-quite-defined “fair share.”  This, of course, is straight out of the Communist credo from each according to his ability, but don’t you dare call him a Communist or you’ll expose your inner Jim Crow.  And Obama has repeatedly given lip service to the notion that he would gladly have this same standard apply to himself.

But isn’t it interesting what happens when the rubber actually meets the road.  The average U.S. household has a total tax liability of about 6.5%—roughly the same percentage as the average pay cut for furloughed federal workers—and Obama’s idea of the wealthy’s “fair share” (at least until he needs even more of their money) is something closer to 40%.  Following that same logic, for him to be showing true solidarity with furloughed federal workers, under his own concept of “fair share” Obama should be giving back at a minimum 40% of his Presidential salary (never mind his total income and the value of all the perks of the office).  Surely he at least should be giving back a percentage equal to the largest pay cut among furloughed workers.  If he were truly trying to share in the sacrifice and contribute his fair share, he should be leading by example and as one of those with the most he should be doing the most, right? 

Nope.

As always with the liberal elites, the need to contribute a “fair share” ends where their own wallets begin; they’re all for more and more sacrifice as long as it’s being done with someone else’s money.  Obama and his surrogates shine a bright light on his “voluntary contribution” in an effort to claim the political high ground, but in reality he’s putting as little skin in the game as possible in order to support that claim.  Meanwhile he plays his golf, and flits from one DNC fundraiser to another in between his lavish vacations.  It’s a sham; a sophomoric veneer intended to fool the gullible into believing that he’s in it for them, that he’s sharing in the sacrifice.

And nobody—but nobody—is calling him on it.

It must be good to be the king. 

Illustrating Government Inefficiency

 

“I don’t mind a parasite.  I object to a cut-rate one.”

            —Humphrey Bogart as Rick Blaine in Casablanca

 

My apologies for the extended absence.  I’ve been occupied with other things, and frankly the news just hasn’t been that interesting.

That said, a reader sent me a series of local news articles that, taken together, cast a neat light on the inherent inefficiency (or corruption) of government.  These articles happen to come out of Akron, Ohio, but they’re not unique and it is not my intent to single Akron out—you can find similar stories (I’ve seen some recently out of Newark and Philadelphia) just about anywhere.  It’s just that the collection makes for a convenient focus on a broader point.

In the first story, it seems that the City of Akron is giving its (largely unionized) employees raises despite a reduced overall budget and significantly decreased revenues.  The raises are to be funded mostly from “federal grant money.”  Meanwhile, as with many private sector employers, the looming specter of Obamacare is likely to produce layoffs and reductions in hours among the lowest-paid workers.  Case in point: Tim Wheeler, a sanitation worker currently working 40 hours a week—subject to regular  90 day furloughs—has been informed he will likely be cut back to 29 hours, specifically so he no longer qualifies as a full-time employee for whom the City would be obligated under Obamacare to provide with health care coverage.  

In the second story, we learn that the University of Akron is facing a nearly $27 million budget gap in 2014.  The shortfall is blamed largely on the loss of $14 million in federal “stimulus” funds.  This is on the heels of a retroactive 5% raise for faculty and top administrators approved by University Trustees last Fall.  Once again, those on the “in” will get theirs, even while the budget shows a deficit.

Notice that these two situations provide a sharp illustration of the inefficiency of government.  In both instances, public institutions facing fiscal headwinds—in the case of the University of Akron, an actual budget shortfall—are nevertheless handing out raises.  This, of course, is exactly the wrong behavior from an entity having trouble paying its bills; you don’t increase your fiscal obligations when you already don’t have enough money.  Unfortunately, however, it’s exactly what we’ve come to expect from bureaucrats whose sole real mission is not protecting the public interest but in preserving their own power base.

Then there’s the policy inefficiency that inevitably results when a perhaps well-intentioned, but nevertheless naïve and ill-informed government exceeds its charter in an attempt to solve every problem of every individual human being.  These efforts inevitably backfire, as those who assume the power/responsibility of crafting the supposed “solution” lack the expertise, foresight, and sometimes basic intelligence necessary to do the job properly (or to recognize that it can’t or shouldn’t be done at all).  In this case, the City of Akron provides us with yet another example of Obamacare directly imposing negative health care and employment effects on the very people it was supposed to help.  I’ll bet you a million dollars Mr. Wheeler voted for Obama and the other Democrats in large part because he thought Obamacare was going to help him; instead he finds his hours—and thus his income—cut by over 25%, and he’s without medical insurance, which is exactly the opposite of what he was promised.

Perhaps more interesting, though, is the common thread in the funding discussion.  The City of Akron is funding its pay hikes with money received through federal grants.  Meanwhile, the University of Akron’s budget shortfall is blamed on the loss of federal funding.  Both circumstances beg the same fundamental question:

Why is there any federal funding involved at all?

Taking the situations in reverse order, it should come as no surprise to the University of Akron that any stimulus money it received dried up.  By definition, that funding was intended to be a temporary boost, not a permanent addition to general revenues.  Yet one gets the impression that the University’s trustees failed to plan for the day when the stimulus funding went away and they would be left to make their way on their own revenue sources, as they had done before.  But like all government money, there’s a sort of ratchet mentality attached to it that assumes that, once granted, the funding represents a permanent floor, and that each subsequent raise only lifts that floor; future funding can increase, but it can never decrease.

More to the point, and germane to both contexts, there is no provision in the Constitution for federal funding of either a municipality or a state university.  Certainly, I understand that such funding has existed for decades, if not longer.  But there’s no constitutional basis for it.  You won’t find anything in Article I that authorizes Congress to appropriate money from the general public to then give to a city.  Nor will you find anything authorizing Congress to appropriate money to fund education (you can argue that the military academies are different, as a legitimate extension of the federal government’s authority to field an army and navy).  Yet there it is.

But here’s what gets me, and it’s the core illustration of the inherent inefficiency (if not outright corruption) of government:

Where does the money the federal government gives to the City of Akron and the University of Akron come from?

Of course the answer to that question is it comes from the government’s general revenues, which means it comes from your taxes.  The rub is in how the outlays are allocated.  There are only two (three, really) alternatives.  One is that they’re allocated proportionately to contribution, such that the people of Akron (and, in the University’s case, of Ohio) are receiving back in the form of federal grants the same proportion they contributed to the general revenue.  And that would seem fair, but it begs the question why it needed to be laundered through the IRS at all.  If we’re just giving Akron and Ohio back their proportionate share of what they put in, wouldn’t it have been far more efficient never to have taken that money in the first place, thus leaving it in Akron and Ohio for the City Council and State Legislature to tax it directly as they locally deem appropriate?

The other—more likely—alternative is that the allocation isn’t proportionate; Akron and Ohio receive back from the federal government grants and funding in greater proportion than their respective contribution to the general revenues.  What this means as a matter of mathematical necessity is that the federal government is taking money from people in, say, Texas, to give to Akron and Ohio.  Even if we indulge in the very unlikely third alternative that Akron and Ohio are receiving funding in a lesser proportion than their share of contribution you still end up with the inequitable situation that they’ve had their money taken from them to give to people somewhere else, say, California.

What we’re left with is a two-edged shaft, if you will.  Either the government is taking money only then to skim off the top and give it back—which is simply unnecessary—or the government is taking money then to skim off the top and give it to someone else—which is looting.  All at the behest of an alleged majority of Americans, but increasingly those who vote for and benefit from the federal largesse aren’t the ones who have to pay for it. 

Inefficiency/corruption at its finest.

*******************************

EDITOR’S NOTE:  Just as an aside, is there anyone who gives a crap what Dennis Rodman does?  I mean, honestly; CNN has been giving The Worm’s budding bromance with Kim Jong Un almost equal coverage with the now-ended conclave in Vatican City.  I could have sworn he became irrelevant a decade ago.

They’re After Your 401(k)

Hold on!  It’s never enough

It’s never enough until your heart stops beating

The deeper you get, the sweeter the pain

Don’t give up the game until your heart stops beating

            —New Order, Shellshock

Do you ever feel like that prehistoric squirrel at the beginning of Ice Age trying desperately to protect against all manner of calamity the one meager acorn he’s managed to save?

I’ve warned before that the Beast was hungry, and it was coming for your 401(k).

Last April I predicted that if Obama were re-elected, one of the things we’d see is the government eliminating the tax deduction for your 401K (at least for higher wage earners), if not retroactively collecting the deferred tax or confiscating your account outright.  Back in August I reported that more and more in the District were starting to pay attention to a proposal by a Dr. Teresa Ghilarducci suggesting the creation of a mandatory federal retirement program to supplement Social Security, which would essentially establish a mandatory replacement for your 401(k)

Well, they’re at it again.

The Brookings Institute has released a report recommending cutting back or eliminating 401(k) tax deductions for higher-income earners.  The concern, apparently, is two-fold.  On the one hand, the 401(k) program is too “costly” an “expense.”  On the other hand, it isn’t achieving its goal of encouraging savings, particularly among lower income workers.  As the report’s author Karen Dynan said:

“We really need to think hard about whether the dollars we are spending are effective at achieving the goals.”

This is juvenile.

To begin with, it’s not an expense.  It’s not.  Allowing you to deduct your 401(k) contribution from your taxable wages is not an expenditure by the federal government; it’s allowing you to keep an added portion of money that’s yours to begin with.  We have to get out of this positively sick mindset that every dollar in existence actually belongs to the Beast, and that to the extent you get to keep anything at all that’s only due to the sacrificial generosity of a government that otherwise has an absolute right to consume it.  Your money is yours, and taxes are the government’s means of confiscating that money from you.  The only “expenditure” in a tax transaction is by the taxpayer.

Second, the 401(k) program and its deduction aren’t really even letting you keep that money.  What they’re letting you do is defer the taxes on that money to a later date—the Beast will still get its slice.  But there’s a significant catch: you can’t touch that money until you turn 59 ½.  And you can’t just hoard it and pass it down to your kids, either; you must start withdrawing it (and paying the taxes on those withdrawals) when you turn 70 ½.  If you violate either rule, there are substantial penalties (and the government still taxes you).  So it’s not like you have free use of that money.

And what’s really silly here is the stated rationale being that low and middle-income earners are still not saving enough, even with the tax deduction incentive.  The proposed solution to this is to eliminate the deduction—for upper-income people.  That’s right: poor people don’t save enough, so we’re going to increase taxes on rich people.

Perhaps I missed something, but how is eliminating 401(k) deductions for the wealthy supposed to increase savings rates among lower-income groups?

No, eliminating 401(k) deductions for the wealthy won’t impact savings by others.  Which is why Senator Dan Harkin (D-IA) plans to introduce legislation this year requiring businesses that don’t offer a 401(k) to enroll workers (with a mandatory company match) in a USA Retirement Fund.  Presumably that would be some sort of federally-managed—you know, because the District is sooooo good at making investments and managing money—retirement account, not unlike the proposal advanced by Professor Ghilarducci.  According to Harkin:

“The dream of a secure retirement is getting fainter and fainter . . . Savings rates are low and there’s no simple way for people to convert their savings into a stream of retirement income they can’t outlive.”

Well, sure there is, Senator: they can save and invest their money—there are oodles of no-load, no-fee, no-minimum-investment mutual funds out there that literally anybody could invest in if they were so inclined—which they’d be in a much better position to do if the District weren’t taking so much of it in the form of Medicare, Medicaid, Social Security, and income taxes.  And, not to put too fine a point on it, wasn’t the solution to this people can’t adequately prepare for a secure retirement problem supposed to have been Social Security, which was a federally-managed retirement account with mandatory participation and employer contributions . . . in other words, exactly what you’re proposing?

If Social Security isn’t solving this problem now, what makes anyone think that a second iteration of it will do any different?

And, as we’re already seeing with Obamacare, this kind of federal effort to force businesses to provide benefits to lower-income employees will end up backfiring.  Businesses that don’t offer 401(k) plans don’t do that because the market doesn’t require it; they are able to maintain an adequate workforce without it.  But once the government compels them to offer the federal plan and make matching contributions, many will conclude that their business economics won’t support that, and they will either begin trimming their workforce or closing their doors altogether; either way, the very people supposedly being helped by this effort end up not only without a retirement savings plan—which they already didn’t have—but also without a job.

Stop helping me already!

But you and I both know at the end of the day this isn’t about trying to ensure everyone has an adequate nest egg.  It’s about trying to find yet another way to generate revenue because the Beast is simply incapable of dealing with its spending problem.  It might be different if these things would make a significant dent in the deficit, but they won’t.  Just like Social Security, Harkin’s proposed program will ultimately become a net drain, between administrative costs and the simple fact that entitlement programs always end up owing more in “benefits” than they bring in.  And eliminating 401(k) deductions will only add an additional $85.8 billion in revenue per year, which is a whopping 9.5% of the projected $900 billion deficit—not the budget, but the budget shortfall—for fiscal 2013.  Put another way, an additional $86 billion covers the Beast’s consumption for about nine days.

The problem isn’t retirement savings; somebody needs to push Miss Piggy away from the buffet table.

What’s The Big Deal?

 

“The government wants you to be scared.  They want everybody to be scared to speak out.  They count on it.”

            —Kevin Costner as Jim Garrison in JFK

 

Once again I see Obama and the Democrats have managed to set up yet another straw man “crisis” over which to cry panic and threaten to blame Republicans if they don’t capitulate.

First it was the 30 million—no, 40 million—no, 50 million—“Americans” who were without health insurance and therefore would surely die in the streets if we didn’t pass Obamacare immediately.  Of course, as we’re now finding out what’s really in it, it turns out a lot of people aren’t going to be covered, and a lot more people are going to lose their jobs (and still not be covered).  Premiums under the “Affordable Care Act” are likely to become less affordable, and the plan that the President swore he wouldn’t sign if it added “one dime to the deficit” we’re learning will in fact add hundreds of billions of dollars.  You’ll be able to keep your coverage if you like it—except when you won’t.  And in the most ironic twist of all, people in uber-blue California are now finding out that not only may they well not be able to keep their doctor, in some instances they may not get a doctor at all.

Then there were the series of debt ceiling scares and the “fiscal cliff,” where we all would surely die in the streets if we didn’t immediately raise the District’s ability to borrow yet trillions more, and raise taxes (only on “millionaires and billionaires,” of course).  As a result, the debt limit (predictably followed soon thereafter by the debt itself) has risen from $14.3 trillion in 2011, to $14.7 trillion, then $15.4 trillion, to its current level of $16.2 trillion.

There’s a reason blitzing is effective in football.  Human beings forced to make snap decisions under duress make mistakes.  That’s Obama’s and the Democrats’ gambit with the never-ending series of “crises”:  it allows them to force through under the guise of necessary emergency action measures they could never get under the crucible of sober debate and reflection.

The latest iteration of these self-made imminent catastrophies is the budget “sequestration” that is to kick in automatically under the Budget Control Act of 2011 if the Congress doesn’t reach a deal to identify $1.2 trillion in spending cuts by March 1.  Recall that this was just another chapter of the illusory give-us-a-revenue-increase-now-and-we’ll-(snicker)-agree-on-spending-cuts-later game the Democrats have been playing for decades.  In this particular instance, the idea was to permit an increase in the debt ceiling, and use this threat of a very dire sounding “automatic” sanction to provide an incentive for both sides to reach an agreement.

The problem, however, is Obama and the Democrats never intended to agree on any spending cuts; what they wanted was a stick that sounded drastic that they could then pound on the table and scream about all the horribles that would happen unless the Republicans stopped their “rigid ideology and partisan politics” (read: give in to everything the Democrats demand).  And, right on cue, the President is out there today signing chapter and verse on how terrible and unfair it’s going to be if the sequestration cuts come to pass:

“These cuts are not smart.  They are not fair.  They will hurt our economy.  They will add hundreds of thousands of Americans to the unemployment rolls.  This is not an abstraction; people will lose their jobs.”

Never mind that the whole sequestration concept actually came from the White House in the first place.  Once the crisis is upon us, it’s forgotten who is actually its source.

Now, I must admit the idea of cutting the budget by $1.2 trillion sounds drastic to John Q. Public, and thus Obama’s prophesy seems dire indeed.  But here’s the dirty little secret:

They’re not cutting one thin dime from federal spending, even if sequestration comes to pass.

The automatic sequestration doesn’t cut $1.2 trillion right now.  It cuts that sum over ten years, meaning it averages a reduction of $120 billion in a given year.  For 2013, the cut is $85 billion, but let’s assume for a second it was a straight-line $120 billion.  Federal spending for 2012 was $3.6 trillion.  For 2013, it is anticipated to run $3.8 trillion.  That’s a $200 billion increase from 2012 to 2013.  If the sequestration took effect and imposed a $120 billion cut, that’s still less than the anticipated increase in federal spending.  In other words, even with sequestration, federal spending in 2013 will still be $80 billion more than it was in 2012.  They’re not cutting spending, they’re just increasing spending at a slower rate.

Further, as you listen to the President’s shrill warnings of impending disaster, let’s look at what the relative magnitude of sequestration really is.  Even if we give the President the benefit of the doubt and accept that sequestration represents an actual cut in spending—which it doesn’t, as I’ve just demonstrated—consider that a $120 billion cut in a $3.8 trillion budget represents a total reduction of just 3.2%.  If we use the actual $85 billion in cuts that sequestration would trigger for 2013, it’s a 2.2% reduction.

Are you kidding me?  Are you telling me we can’t survive even a 2-3% reduction in federal spending without inciting an economic catastrophe?

Bovine defecation.

House Minority Leader Nancy Pelosi (D-CA) is running around claiming that the federal government doesn’t have a spending problem.  Respectfully, Ms. Pelosi, denial ain’t just a river in Egypt.  The fact of the matter is that the 2013 projected spending in constant 2005 dollars is about $3.2 trillion.  With the exceptions of 2010 and 1993, that spending level—again, in constant dollars, meaning this isn’t simply the effect of inflation—has risen every single year since 1988.  During that time, federal spending has doubled.  To put that in perspective, the U.S. population in 1988 was 244 million; at 313 million today, it has increased by a little more than 25% over the same period.  Since 1972, federal spending in constant 2005 dollars has tripled, while the population increased less than 50%.

This is the problem.  It’s not priorities, and it’s not that we don’t tax ourselves enough.  When all you do is tax, tax, tax, and borrow, borrow, borrow without ever doing something meaningful to scale back your outlays, you’re not addressing the problem.  And we can’t continue like this indefinitely.

I submit that sequestration is a false boogeyman.  There’s nothing to be afraid of, except that it doesn’t go anywhere near far enough.

Form Over Substance

“I was thinkin’, it really don’t matter if I lose this fight.  It really don’t matter if this guy opens my head, either.  ‘Cause all I wanna do is go the distance.  Nobody’s ever gone the distance with Creed, and if I can go that distance, you see, and that bell rings and I’m still standin’, I’m gonna know for the first time in my life, see, that I weren’t just another bum from the neighborhood.”

            —Sylvester Stallone as Rocky Balboa in Rocky

 

One of the better columnists out there is Charles Krauthammer, and it is a rare occasion indeed when I dare to disagree with him.

This is one of those times.

In his latest piece at Jewish World Review (h/t to my buddy Brutus), Krauthammer argues that there is no real fundamental split in the GOP; that the divide is simply a matter of tactics, rather than one of substantive philosophy on policy.  One camp, as Krauthammer views it, is committed to fighting the President and the Democrats on shrinking government and reducing spending, even though they only hold a majority in one half of one branch of government.  The other camp—that of the GOP establishment (Speaker Boehner, Minority Leader McConnell, et al.)—views resistance as futile, and therefore eschews the fight in favor of capitulation.

Krauthammer takes the view that the latter position is the only practical alternative.  Either way, he says, the GOP is going to lose on the budget/debt issue, and if they press the issue and stick to their guns they’ll not only lose but take the blame for being obstructionists.  So rather than lose and come away with egg on their face, he argues that the pragmatic approach is to accept that you can’t govern from this position, and offer a watered-down short term proposal that cannot be refused.

In other words, roll over and punt.

I hold Mr. Krauthammer in the highest regard, but respectfully I could not disagree more on this one.  First, the situation as he describes it in fact does reflect a fundamental substantive split.  Either you hold to a conservative fiscal philosophy or you don’t.  If you do, that’s not subject to compromise (or, in this case, all-out abandonment) simply because 51% of the country (or, more to the point, 51% of the votes that got counted) elected Obama.  There are those in Congress who actually do stand on conservative principles; the GOP establishment simply isn’t among them.

Second, Krauthammer’s position that even if you resist you’ll end up losing depends on his assumption that at the eleventh hour even the resistance will be forced to cave in.  Why?  If you’re going to resist, resist.  If they have the votes to pass something over your objection, let them do so; then they own it and you can rub their noses in it before the public when it fails, something you can’t do if you’ve capitulated, because they’ll cast the policy as bipartisan.  If they don’t have the votes, then you’ve won by stopping a bad policy—it’s not a loss if nothing happens.  It’s OK for Washington to stop.  A legislature doesn’t HAVE to legislate.

Third, I think Krauthammer may be being a little naïve here.  There is no middle ground compromise to be made, and no offer that cannot be refused.  Obama and the Democrats have made it clear that they are not going to negotiate on anything.  It is a fool’s errand to try it.  Look back to the original debt limit discussions in 2011: the entire thing consisted of Boehner making revised offers and Obama telling him to “spit higher.”  The result, of course, was the “compromise” that led to the current problems with the debt ceiling, budget sequestration, and the “fiscal cliff.”  That’s just how it’s going to be with this President if you try to meet him in the middle.

Finally, Krauthammer’s concern over the GOP “taking the blame” is misplaced.  What is the nature of this “blame”?  Public opinion.  But what is that, really?  Nationwide polling asking about a global opinion of the GOP as a party is almost totally irrelevant, particularly now that we’re out of the Presidential election cycle.  Nobody in Congress, particularly in the House, represents the nation, or Gallup; the President is the only one elected on that scale.  Each member of the House is elected by the 750,000 or so citizens of his or her district.  The job of a Representative is precisely that: to represent the interests of those people, and no one else.  It’s not their job to compromise or go along to get along.  And it’s certainly not their job to concede the interests of the people in their district simply because they are not part of a governing majority.

And this is the real rub with Krauthammer’s argument (and it particularly irritates me, because he knows better).  He’s effectively accepting the premise that this country is a true democracy, that we operate on an absolute majority rule basis, and that anything 50%-plus-one wants, they get without opposition, dissent, or even discussion.  That, of course, isn’t the way our government was designed to operate, and in fact Krauthammer’s premise defeats the very point of that mechanism.  Rather than a true democracy, we have a constitutional republic, where power is distributed among three co-equal branches of government, and the legislative power is divided yet further into a bicameral (two houses) body.  The system is specifically designed to promote debate and opposition, and to protect the minority from the whim of the majority.

But all of that is lost if you simply punt because it’s more pragmatic to recognize that you can’t pass anything of your own when you’re in the minority.  If you’re not going to oppose when you’re in the opposition, then why bother showing up in the first place?   We could just say that everything was decided on November 6, and now the Democrats get to do whatever they want for the next two years; they can legislate via teleconference among their own caucus, and we don’t even need to convene Congress.

I’ve been making this point from the very beginning of Chasing Jefferson.  You don’t fight only the fights you can win; you fight the fights that need fighting.  You stick to your guns, and if you go down, you go down swinging.  Rather than worrying about being blamed for obstructionism, the Republicans need to re-learn how to present their case to the public.  The current leadership can’t do it.

The Democrats are going to do what they’re going to do.  The GOP doesn’t need to accommodate them.  It needs to be able to explain that, explain who owns it, and explain the cause-and-effect when it goes bad.

No Real Bias For Action

“It is a tale told by an idiot, full of sound and fury, signifying nothing.”

            —William Shakespeare, Macbeth

 

Once again, President Obama has demonstrated that he’s all political style, and zero substance.

On Wednesday—once again emphasizing the urgent need to take decisive action to save lives—he announced a series of executive actions he is undertaking unilaterally to reduce gun violence.  Further highlighting the importance that we do this to protect the safety of children, and in an impossibly cynical and sophomoric bit of political showmanship, he surrounded himself on stage with a bunch of grade-schoolers.  We have to do this for the kids.

It’s too bad that the executive orders he signed have essentially nothing to do with preventing gun violence.

Consistent with everything else this man has said over the last four years, the list—up to 23 items from the advertised 19—is chock full of vague platitudes like “launch a national dialogue . . . on mental health.”  What the hell does that mean?  In all, there were five items relating to data sharing and tracing (i.e., knowing which law-abiding citizens have guns, and where they go after a crime has been committed) two on research, two on safety standards and practices, and one each on the prosecution of gun crimes (again, after  the crime has already been committed) and administrative matters.  In fairness, three items related to training and response plans for law enforcement and school officials, although query how that’s in any way a legitimate federal responsibility or even prerogative.  But a whopping FIVE—basically a quarter of the entire list—dealt with issuing or clarifying new regulations under Obamacare.

Health care regulations are going to prevent gun crimes?  Really?

In all, roughly half the list dealt with tracking law-abiding citizens and the unconstitutional health care law.  Not surprisingly, Wednesday’s actions also included some $4.5 billion in new spendingBy all means throw some money at the issue.  Among the whoppers in the spending are $150 million for new school resource and guidance counselors, $50 million for schools to create “safer and more nurturing” environments, and $50 million to train social workers, counselors, psychologists, and other mental health professionals.  I guess we’re now turning these people into either the new gun-control enforcers or at least government informants; they’ll eventually be subject to liability if they fail to turn someone in and that person later shoots someone.  Worse, the prospect that they in their sole judgment have the power to put people under federal scrutiny has to have a chilling effect on people’s willingness to go seek help when they need it.  Sounds like a positive step, doesn’t it?

Like so much from this President, Wednesday’s announcements contained a lot of noise, but at the end of the day didn’t do much.  I suppose I should be thankful that, at least for now, Obama has kept his exercise of Imperial authority to a relatively modest level on this issue.  On the whole it’s a bunch of nothing at least as it relates to the stated goal of actually preventing gun violence.  But at least he acted, and he did so within a month of the school shootings in Connecticut.

And boy, did it make for good political TV.

But contrast his swift, if meaningless, action in this instance with some other notable issues facing his administration.

It’s been now five years, and he has never presented Congress with a meaningful budget.  What little effort he has made in this regard has been routinely and unanimously rejected even by his own party.  Given his current insistence that Congress must raise the debt ceiling yet again and do so without placing any contingencies concerning reducing future spending, one begins to suspect that the underlying problem may be he has absolutely no idea what a budget is.

It’s been 129 days since the American consulate in Benghazi, Libya was attacked in what now appears to have been a large military-style assault.  Four Americans were killed while the White House and/or CIA watched live via spy drone.  These were Americans that, unlike the children in Connecticut, actually were the federal government’s—and, more to the point, this Administration’s—responsibility.  Obama’s own State Department put these people in harm’s way, and kept them there despite obvious warning signs and repeated pleas for help.  Yet for all his talk about the urgency to take action to save even one life, President Obama hasn’t even had the temerity to address the nation on what happened.  Not exactly a bias for action there.

It’s been over two years since federal agent Brian Terry was killed near the Mexican border; yet another dead American.  Ironically, in this instance not only was Terry’s safety the responsibility of the federal government, but he was killed by guns; guns allowed into the hands of Mexican gangsters by this Administration.  Yet there’s still been no real explanation to the American public or to the Terry family, and no real fallout from the incident.

We are still in Afghanistan with no mission, even though Osama Bin Laden was killed nearly two years ago.  Meanwhile, over 1500 Americans have been killed in Afghanistan during Obama’s four years and three weeks on the job.  That’s nearly three times more than killed during the entire eight years of the Bush administration, in half the time.  Indeed, just in the time since Bin Laden’s death, the number of Americans killed in Afghanistan has nearly matched the total Bush-era fatalities (606 vs. 630).

This guy is all about what makes him look good, and nothing more.  For all his flowery talk about saving lives, the actions he took Wednesday have little to do with that.  When it’s been time to face up to real issues in a substantive way, particularly when there’s no good political theater to be had, he’s a complete no-show.  Even on other issues when there’s been real action he could legitimately take to save American lives, if it won’t make him look good on TV, he’d rather just wait out the news cycle and hope everyone moves on to American Idol and forgets about it.

At least his handicap is going down.

Getting Serious About Cutting Spending

“Looks like there’s not a lot of options, kid.  Somebody’s gonna have to make the hard choice if we’re gonna get out of here alive.”

            —Morgan Freeman as Joe Matheson in RED

 

Just to recap, the national debt now stands at $16.4 TRILLION and climbing.  Last week’s “fiscal cliff” deal will add another $4 trillion, meaning it will top TWENTY TRILLION DOLLARS by the end of the Obama administration.  And the federal government currently borrows about 40 cents out of every dollar it spends, meaning it spends roughly 67% more than it takes in.

Now, against that backdrop we see that apparently the $632 billion in additional taxes built into last week’s debacle just isn’t enough for the Left; Nancy Pelosi and the Dems are now making noises about seeking an additional $1 trillion in new revenue (read: yet more taxes).

Where does this end?

Now I will agree that we are in serious need of some reform on the revenue side of the fiscal equation.  When the income tax was instituted in 1913, the Internal Revenue Code was just 400 pages long, roughly the length of a Harry Potter novel.  Today, that same body of law weighs in at a staggering 70,000 pages, and that’s exclusive of the thousands of court decisions and IRS opinion statements interpreting the law.  It’s no wonder that over half of Americans have to hire a tax professional in order to navigate the law and make some attempt at actually paying their taxes.  Moreover, one suspects the complexity of the tax code is a major reason the Treasury budget in 2011 was $532.3 billion.

That’s right kiddos: we spend over a half-trillion dollars a year on taking money from ourselves.

And this alone highlights the fact that the real issue isn’t revenue, it’s spending.  We’ve previously covered the fact that you can’t raise enough taxes to cover our spending.  There simply isn’t enough money to tax.  And yet the solution—in the interest of ensuring that “everyone pays their fair share,” and not making the middle class and the elderly bear the burden—is always more and more taxes (or more and more borrowing).

The District has for too long promised too much to too many, and far more than it actually had to give.  And what’s so perverse about this whole fiscal discussion is that the spending is not only the cause of the problem, it is now so entrenched as fait accompli that it actually becomes the justification for more taxes.  We see the same argument now coming from a number of corners on the debt ceiling debate.  They point out that the debt ceiling isn’t really about future borrowing, but about covering money already spent; you can’t argue about increasing the debt ceiling, they say, because that’s just paying off what’s already been done.  And so spins in a never-ending cycle of increasing spending, then throwing up the hands and saying we have to raise additional revenue (higher taxes/higher debt limit) because we already spent the money.

To be serious about addressing our fiscal problems, you must cut spending.  You must cut it drastically, and you must cut it now.  This is how you know nobody in the District (on either side of the aisle) is serious, because they simply never address this fundamental reality.  The best they do is speak in vague terms about “considering” spending cuts over time in the future, which really means at most reducing future spending increases.  That’s never going to get it done.

Any legitimate, adult consideration of the issue has to focus on the big ticket items:  Defense, HHS (Medicare), and Social Security.  These three alone cost $2.28 trillion in 2011, 59.7% of the total federal budget.  Add in another $532 billion for the IRS, and you account for three-quarters of all federal spending.  I submit there’s some room to maneuver here.

Let’s start with Defense.  I believe in peace through strength, and I understand that we have a legitimate interest in maintaining some global presence (or at least capability).  But come on.  Looking at the Defense Department listing linked in Wikipedia, and the DOD base roster, we have over 600 overseas military facilities in over 150 countries.  Pardon the unintentional pun, but that’s overkill.  I mean, do we really need a military presence (however small) in Nepal?  In Papua New Guinea?  In Chad?  Surely we can still project power and help our allies without stationing troops on every square inch of the planet—that’s why the Constitution gave us the U.S. Navy.

This massive global presence carries a massive price tag.  According to the Stockholm International Peace Research Institute (SIPRI), our current defense budget not only ranks first in the world, it comprises 41% of the entire planet’s military spending.  We spend five times as much as China, the next biggest military spender.  We spend ten times as much as Russia, the next biggest.  In fact, we spend about as much as the rest of the top 15 military spenders COMBINED, and many of the others on that list are our friends.  Let’s cut that budget by 40% by putting an end to the occupation of Afghanistan, Iraq, and Libya, closing the bases in Japan and Europe, and turn it back over to the rest of the world to defend themselves.  And just to put it in context, a 40% cut would still leave us spending $444 billion a year, which is really only ratcheting back to about 2005; we’d still be spending three times as much as China, and twice as much as China and Russia combined.

We can parallel that 40% cut in HHS, through serious rollbacks in Medicare and other unconstitutional “services.”  As with Defense, this cut isn’t as harsh as it sounds, as it reflects only a return to 2005 spending levels.  And if you reformed the Tax Code as I suggest, my guess is the Treasury budget could be cut in half (probably more); $266 billion a year is still more than insane.

Other big-ticket agencies that, frankly, it’s difficult to see what they do anyway, could take cuts of 50% to 67%, and for the most part would only be returning to the levels of the Bush 43 administration: Agriculture, Education, Energy, HUD (I would cut entirely), Labor, International Assistance, and the Office of Personnel Management.  One could make a strong argument for doing away with most of these agencies altogether.  I mean, what do they do, really?  The Department of Agriculture doesn’t grow anything (if anything it subsidizes farmers not to grow).  The Department of Education doesn’t educate anybody.  The Department of Energy mostly impedes the production of energy.  HUD doesn’t house anybody.  And so on.  So why do we pour hundreds of billions of dollars into these things year after year?

That leaves Social Security and the remaining “other” spending.  Social Security needs an overhaul, but it’s sticky because for all its problems you are talking about beneficiaries who spent a lifetime contributing into a system based on the promise that they’d get that money back.  We can’t renege on that.  Any reform would have to come over time, and it will require a younger generation accepting the difficult premise that they’re going to have to contribute in and NOT get anything back.  But surely the SSA can find 10% of waste it can trim.  As to the rest of the budget, I think a 20% haircut is a modest request.

These are big-ticket cuts on big-ticket items, and that’s the only way you’re going to get serious progress on correcting our financial situation.  All together, these proposed cuts would yield a budget of about $2.4 trillion—still a huge federal edifice, but a good start towards getting things back under control.

But more than a few in the District are going to have to own up to the problem like grownups, and I don’t see that happening any time soon.