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Wednesday, February 03, 2010

"This Budget is Insane"

Yesterday, Rep. Mike Pence (R-IN), said of the newly delivered to Congress budget, "This budget is insane."

The budget is $3.8 trillion. The President went off to New Hampshire to sell the new budget to the people paying for it - the taxpayers - and spoke of the fact they 'we' can't be spending money we don't have. Ironic, huh? While this administration is tripling the national debt and blaming former President Bush for everything, still, he would like for us to believe he is a deficit hawk. Talk about Groundhog Day scenarios.

Nerves are raw on Capitol Hill. Republicans trying to move common sense solutions forward are being thwarted by ideological Democrats who believe the solution to everything is for government to throw money at the problem. Even Senator Judd Gregg, the Senator from New Hampshire known for his calm demeanor, exploded yesterday at Peter Orszag, Director of the Office of Management and Budget, during a hearing.

Orszag was trying to explain the intention of the Obama administration to use monies paid back - from the TARP loans - the first of the recent federal bailouts - for loans to smaller banks. Senator Gregg, the author of the TARP legislation, told Orszag that this idea was illegal, as the law is written. The monies are to be used to pay down the national debt, since the loan to the banks was borrowed money. What was Orszag's response? He said the administration intended to change the law.

TARP has worked well. President Bush and Treasury Secretary Paulson deserve some credit for this, whether you agree that the government should have bailed out the big banking institutions or not. The monies have been paid back and some have been paid back with interest. The government has made a little money off TARP.

Comparing TARP to the next bailouts, which have happened under the Obama administration, beginning with the stimulus bill shows a different story. Subsequent bailouts have not been successful to move the economy into the right direction, as we were told.

From www.investors.com : "The proposed budget over the next decade would rack up $45.8 trillion in new spending, $9.1 trillion in deficits and more than $2 trillion in higher taxes on Americans. It will double the national debt held by the public to over $18 trillion, while raising taxes on 3.2 million small businesses and upper-income taxpayers — the very people the administration is counting on to pull us out of recession."

Yes, this is insane. We cannot spend our way out of debt. That fact was proven back in the days of the Great Depression. The current party in power - the Democrats - are trying to relive the days of FDR and promote massive federal government intervention as the way forward. From taking over the automobile industry, appointing a "pay czar" to tell private business how much they are allowed to pay their executives, and picking winners and losers for the goodies, our nation is not on the right track. We were told that the stimulus/spending bill had to be passed - though no one even knew what all was in the legislation - so that unemployment would not reach 8%. It is now over 10%. Yet, the Obama administration stubbornly pushes on with failing policies.

The definition of insanity? Doing the same thing over and over while expecting a different result. Sounds familiar.

3 comments:

nicholas said...

TARP was necessary because of government interference in the banking system, namely forcing loaning institutions to make high risk loans. And as these loans were guaranteed by the Federal government, it was safe for banking investors to bank aggressively, under the certain knowledge that realestate values were going to continue to rise.

They did not, and the reuslt should have been let the government stay out and allow the market to adjust itself, with the resultant recession of 10 to 12 months, reverting back to a robust growth economy. Instead we have on going efforts to maintain a bubble economy that cannot be sustained, further and further intrusion of the government into the private sector (who ever thought that was a good idea) and we have clowns like Barney Frank calling for more government involvement and direction of the banking industry. (?!) This guy should be going to jail, not recommending more banking committee nonsense. And the Obama administration? Heading down a path that is the antithesis of the principles upon which the country was founded. It does not look good for our future or the future of our children.

Excellent post.

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