Friday, January 28, 2011

Why the repeal of obamacare is not an exercise in futility

The MSM is pushing the liberal message that the fight against Obamacare is a purely symbolic gesture.  In my opinion, they are significantly underestimating the seriousness of the battle against the new health care entitlement.

Of course, it's certain that the current Senate and President wouldn't allow the repeal to pass.  Still, the successful repeal of the bill in the House does matter.  John Yoo, in an interview on Peter Robinson's Uncommon Knowledge, makes a compelling point about the relevance of the legislative repeal of Obamacare.  

"The Supreme Court doesn't like to strike something down and be extremely unpopular, and have every other branch of government angry at it.  I wish they didn't think this way, but I think there is some evidence that they do think this way.  If they see a Congress trying to vote to overturn Obamacare and it is just being vetoed by the President, that gives them a lot of political cover to strike down Obamacare in the courts."

Here is the full interview. This is #2 in a 5 part series of interviews with John Yoo and Richard Epstein.

Wednesday, January 26, 2011

State of the Union Address: "Winning the Future" ... (wtf)

President Obama titled his 2011 State of the Union Address: "Winning the Future", or more briefly ... 'WTF'.

Some nuggets from Obama's speech:

"At stake right now is not who wins the next election. After all, we just had an election."

WTF ... Of course the next election is at stake.  I'm sure that the President wishes the next election wasn't at stake, but that doesn't make it true.  The elections of 2010 were a giant mandate for limited government and the President is the enemy of limited government.

"We're the nation that put cars in driveways and computers in offices, the nation of Edison and the Wright brothers, of Google and Facebook."

WTF ... Facebook? Really? Facebook is the technological beacon of America?  Seriously, that's the best you could come up with?

"So tonight, I am proposing that, starting this year, we freeze annual domestic spending for the next five years..."

WTF ... Apparently, the discretionary 'spending' freeze must exclude all the discretionary 'investment' programs that he announced immediately after proposing the freeze ... like high-speed monorails, high-speed internet, electric cars, biomedical research, clean-energy research, etc.  The problem is not that those are necessarily bad ideas.  The problem is that they should be pursued by private enterprise not by the government.  If the country needs a monorail, the market will bear that out.

"... Now, this would reduce the deficit by more than $400 billion over the next decade"

WTF ... Let's ignore Obama's obvious contradiction regarding discretionary spending.  400 billion over a decade?  That this is a triviality relative to the deficit he is proposing to reduce.  Even if we take Obama at his word on this claim, ~40 billion per year in deficit reduction compared to a 1.29 trillion dollar 2010 deficit is barely 3%.  A drop in the bucket.

"... the only way to tackle our deficit is to cut excessive spending wherever we find it – in domestic spending, defense spending, health care spending, and spending through tax breaks and loopholes."

WTF ... 'spending through tax breaks'?  This short phrase provides a dramatic insight into the world view of the President.  He considers tax breaks to be government spending.  In other words, your money belongs to the government, and Obama wants to cut back on your allowance.  While it's humorous to consider that Obama would actually cut spending in domestic programs or in health care, I do take him at his word when he says he will cut defense spending and increase taxes.

To summarize Obama's new language:
  • A tax increase is now a "spending reduction"
  • A spending increase is now an "investment"

So, buckle up. Obama is planning a lot of "spending reductions" along with increased "investments".  Gee, it sounds so reasonable when put that way.  Doublespeak is so fun, isn't it Mr. President?

"We do big things"

I actually believe Obama on this one.  Unfortunately, by 'we', Obama is referring to the American government rather than the American people.

Wednesday, January 5, 2011

Why Call It a "Ceiling" ...

... if you just keep moving it up whenever you feel like it?

ceil·ing [see-ling]
3. An upper limit, especially as set by regulation

 Obama, for once, had it right in 2006, when he argued against the debt ceiling:
"The fact that we are here today to debate raising America’s debt limit is a sign of leadership failure. It is a sign that the U.S. Government can’t pay its own bills. It is a sign that we now depend on ongoing financial assistance from foreign countries to finance our Government’s reckless fiscal policies. … Increasing America’s debt weakens us domestically and internationally. Leadership means that ‘the buck stops here. Instead, Washington is shifting the burden of bad choices today onto the backs of our children and grandchildren. America has a debt problem and a failure of leadership. Americans deserve better."

It would be a mistake for the Republicans in the House to pretend to draw a line in the sand on this issue, only to cave later.  That would give Obama the ability to claim a political victory on the issue as he did with START.  So, hopefully they are serious about it if they choose to pick this fight.

It's worth considering what would happen if the debt ceiling is NOT raised.  The debt ceiling is currently at 14.3 trillion.  The actual US debt is currently at nearly $13.9 trillion and growing (quickly). 

Would the the US default on it's debts?  While this is the doomsday scenario that the Democrats are focusing on, it seems very unlikely.  The debt ceiling wouldn't be set to $0, it just wouldn't be increased over the $14 trillion it is already at.  Presumably, US creditors get paid first, and either discretionary programs are de-funded, or the government just continues to borrow money from itself (the Fed).

Given past behavior by the Fed during this administration, the latter seems most likely. 
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