Merry Christmas to All

One of the beauties of the Christmas season is that it is an annual reminder of the goodness that exists in mankind’s heart.  It is such a special time of giving, fond memories, family and love. 

For most of the year we are bombarded by the media and life’s experiences with the dark side of human nature.  (Newtown, Connecticut being a current and particularly painful example.)

Christmas is a reassurance that life has a bright side, too.

And there is another aspect to the season for those who believe (and I’m not thinking of Santa Claus).  Life is a temporal affair.  Live a good life.  Problems come.  Difficulties pass.  And always, heaven awaits. 

So, an aside to my conservative brethren, our time will come again.  Don’t give up.  Keep the faith. 

Merry Christmas.

 

Liberal Insanity

How can any sane person advocate spending money he doesn’t have?  Funds could come from one of only two sources.  Compel others to pay it (thievery) or borrow it (with no foreseeable ability to repay it, bankruptcy is inevitable). 

But, of course, different rules apply to government, don’t they?  Sure, forcing others to pay money can be called taxation and borrowing funds can be labeled fiscal policy.  And the Federal Reserve, in effect, can simply print more money.  But different names don’t change economic realities applicable to individuals and governments alike.

Increased taxation will decrease the ability of the private sector to fund economic growth.

Increased borrowing will up the national debt from already astronomical levels of $16 trillion.

Expansion of the money supply (“print it”) will eventually result in inflation.

But no matter.  This is what President Obama wants.  And that is insanity.

But why, liberals respond, fear a growing national debt?  Don’t we owe most of it to ourselves?  Yes, but 40% of the debt is owed overseas, China in particular.  Interest, of course, must be paid on 100% of the debt.

With the economy still in a rather sorry state, interest rates on the national debt are historically quite low.  But history tells us that they won’t remain so.  How are those increased interest payments to be paid? 

Let’s assume that the current interest payment is 1% on the national debt.  (It is actually less, now.)  That’s $160 billion a year.  Put the interest rate at its historical average of 4% and interest payments rise to $640 billion.  That is one half of our current annual deficit of $1.25 trillion.  How is that going to be paid? 

The downward spiral will accelerate. 

Why do liberals think [or do they even contemplate the prospect?] that we won’t share the Greek fate?

Is it possible that taxation and borrowing won’t be enough to pay our current national debt?  Printing more money wouldn’t help.  The value of the dollar relative to other currencies will drop due to inflation.  Creditors will demand even higher interest rates to compensate, as a result. 

It is insane to think that the consequences can be otherwise.

 

 

Obama and the Continuing Assault on the “Top 2%”

Those who expected President Obama to drop the class warfare rhetoric after the election were wrong.

Barack Obama’s campaign repeatedly called for tax rates to go up on the “wealthiest” two percent. 

Not coincidentally, Mitt Romney is a long time member of that select category so the Democrats’ call for a tax increase on the rich had the political benefit of highlighting the claim that the GOP nominee wasn’t “like the rest of us”. 

But for the President, it was more than politics.  He is truly a man of the Left who believes that the rich have too much (remember, “you didn’t build that”?).

How else could one claim that it is “unfair” to the rest that the top tax rate is only 36% and, therefore the top level should rise to 39.6%?  It’s not as though we don’t already have a steep progressive tax system ranging from 0-36%.  But for Obama “fairness” compels that it be steeper still!

What exactly does fairness mean if the top 1% income earners currently pay 37% of the nation’s income tax while sharing only 17% of the nation’s total income.  Maybe, to Obama, being rich itself is unfair.  So, if people are wealthy, such thinking goes, they should pay proportionally more than others not only because they can, but more importantly because it’s the right thing to do.

The Administration tries to obscure this motivation by cloaking the tax rise argument with the insistence that it’s an essential element of a deficit reduction package.

That is ridiculous.

Raising the tax rate 4% on the top 1%, would generate $88 billion* in additional revenue if high earner income did not decline from 2011 levels.  (A rate increase might very well be a strong disincentive to earn such income.)

That amount is not even 8% of the projected 2012 deficit of $1.1 trillion.  So how is the 92% of the remaining deficit to be treated? 

Reducing spending by $1 trillion by 2013 would get us there.  But, of course, President Obama has nothing of the sort in mind.  In fact, his “fiscal cliff” avoidance proposal calls for $50 billion more in stimulus money. 

No, the reality is that he will do one of the following:  increase taxes across the board (which means the other 98% - half of whom do pay some income tax) and/or continue to increase the deficit by spending money we don’t have by borrowing it from the Chinese, among others.

Neither outcome will be good for the economy.  However, that’s plainly not the President’s primary concern.  He insists that there will be no deal without the 2% paying higher taxes.

After all, isn’t fairness more important than the health of the economy?

 

 *The IRS, which is the source of the income figures recited above, does not break-out the income levels for the top 2%.  Rather, it does so for 1%, 5%, etc.  Thus, there is educated guessing involved when calculating 2% numbers.  My estimate is that the total revenue generated by a 4 point tax increase on the top 2% would equal about $150 billion, still a very small portion of the annual deficit.

 

 

 

 

 

Republicans Must Do a Better Sales Job to Win the White House

No major overhaul of the conservative agenda is called for.  Despite Obama’s campaign of distortion, class-warfare and name calling, the incumbent won by only 3%. 

Government is too large and spending needs to be cut – not merely slowed.  Obamacare is bad for the health care system and individual liberty.  America’s economy needs more freedom, not more regulation.

Yes, the candidate running on those positions lost but not because of their content.

Consider some exit poll results:

          “Government is doing too much” 

                             Agree:  50%

                             Disagree:  43%

 

          “Obamacare should be repealed”

                             Yes:  49%

                             No:   44%

 

“Should taxes be raised to cut the deficit?”

                             Yes:  33%

                             No:  63%

 

So the election results were not the result of disfavored views. 

How about the electorate’s view of the economy?

          “Current US conditions are”

                             Good and getting better:  43%

                             Poor and getting worse:  55%

          “Most important facing country”

                             Economy:  59%

                             Deficit:  15%

                             Health care:  18%

 

Sounds like Romney should have won in a walk… until you take into account other exit poll findings.

          “Who would better handle the economy?”

                             Romney:  49%

                             Obama:  48%

          “Who would better handle the deficit?”

                             Romney:  49%

                             Obama:  47%

These voters were kidding, right?

Romney, a successful businessman, was considered no more competent than the incumbent who has presided over the most anemic recovery in decades? 

And President Obama, who added 6 trillion to the National debt, is equal to the task of debt reduction?  What’s going on here?

What else can there be but a failure to communicate?

Maybe it was Romney’s sometimes awkward style and statements.   Certainly Obama’s attacks on Bain Capital played a role.  Plainly, there was a desire on the part of many voters to give the president a pass on the economy.  [Another poll result: “who is to blame for the present state of the economy?”  53% said Bush, only 38% cited Obama – after nearly four years in office?]

I suggest that 2012 was the political equivalent of a perfect storm for Republicans.  Despite all the apparent economic factors in its favor, the GOP ship of state sunk to the bottom due to the performance of its captain who confronted a surprisingly strong Obama wind generating capsizing waves. 

How can the waters not be calmer for conservatives next time when Obama finally leaves office in the wake of the debacle that will be his second term.

But caution:  We’re unlikely to win in 2016 either unless we do a better job of selling our candidate and convincing that three percent that the conservative approach is superior to the Left’s.