Spending Folly – by Vasko Kohlmayer


waste

“The U.S. government racked up a gaping shortfall in the first two months of this fiscal year after posting a record budget deficit last year,” reported Reuters recently.

Just in the first two months of fiscal 2010 – which began in October – our federal government managed to incur a budget shortfall of $292 billion. Alarmingly, the gap for the first two months of this fiscal year was wider than it was during the same period of last year, which ended with with a record deficit of $1.42 trillion. If this present trend continues, the government’s shortfall by the end of this month will match Bush’s 2008 spending record of $455 billion.

Here is something to ponder: In barely three months of this fiscal year, Barack Obama will manage to equal the outlays of George W. Bush during the whole of the most financially profligate year of his presidency.

The left used to bemoan bitterly the financial overindulgence of the Bush administration. Justifiably so. It is just too bad that they do not apply the same standard to the current administration. With Obama in charge they see nothing wrong with mind-boggling financial excesses and waste. They, in fact, clamor for more. Not content with the $786 billion pork-ridden outrage which they speciously called “stimulus,” they now demand another rescue package.

Liberals across the ranks – from Paul Krugman through Nancy Pelosi to Howard Dean – are calling for more money to be pumped into the moribund economy. One should not be wholly surprised at this, as the big spenders have repeatedly shown themselves singularly adept at stirring taxpayer money to themselves and their friends. Last week it was revealed, for example, that two firms ran by Hillary Clinton’s pollster Mark Penn grabbed nearly $6 million from the stimulus allotment.

In his speech at the Brookings Institution last week President Obama promised what amounts to a new round of massive spending. Among other things, the president proposed “a boost in investment in the nation’s infrastructure beyond what was included in the Recovery Act,” “incentives for consumers who retrofit their homes to become more energy efficient,” and expanding “select Recovery Act initiatives to promote energy efficiency and clean energy jobs.” The president crowned this laundry list of waste with what looks like another financial black hole which will devour yet more of this country’s wealth:

[W]e should also extend the relief in the Recovery Act, including emergency assistance to seniors, unemployment insurance benefits, COBRA, and relief to states and localities to prevent layoffs.

Keep in mind that all this waste will be pilled up on top of last year’s out-of-control spending which resulted in record-breaking deficits and a skyrocketing national debt.

Moody’s Investor Service has warned that the fiscal mess in Washington may eventually prompt it to lower America’s debt rating. Trying to be as delicate as possible, Moody’s said that the country’s public finances may “test the AAA boundaries.” One can get a sense of how bad America’s financial condition must be if even Moody’s worries about it. After all, Moody’s – the world’s top credit rating agency – did not see anything suspicious about a whole array of mortgage backed securities whose failure contributed greatly to the 2008 credit crisis.

Moody’s warning is in reality a plea for America to put its fiscal house in order. The fact that America still enjoys AAA rating is something of an anomaly, because America’s debt is not really safe. Any sober assessment must conclude that America cannot honestly settle with its creditors. The overwhelming obligations of the federal government make this impossible. America’s debts can only be nominally repaid with inflated money. Moody’s knows it, but being part of the monetary regime it will not adjust its rating to the reality of the situation. Doing so would require that the ratings of a number of other governments and financial institutions also be lowered. This would disrupt the workings of the highly fragile monetary system and expose its ultimate unviability. Ken Rogoff, the former chief economist at the International Monetary Fund was recently quoted by the British channel Sky News as saying that “so many countries are in trouble that it is hard to know where the crisis could hit next. Once one sovereign state veers into default, clusters of others usually follow.”

In the meantime, Fitch – another of the world’s top rating agencies – did cut the credit rating of Greece to BBB+ with a negative outlook. The agency cited deep concerns over the country’s public finances as the reason for the move. Greece’s problems spring from the government’s reckless spending which has pushed the nation’s budget deficit to 12.7 percent of GDP. This is way above the eurozone’s limit of 3 percent.

Anders Borg, the finance minister of Sweden, the country which currently holds the rotating EU presidency, warned that the Greeks need “to get serious about their fiscal situation.” Stating the obvious, Borg said that a country that wants to remain financially viable “can’t run a 10 or 12 per cent deficit.”

Greece’s finance minister George Papaconstantinou responded that the country’s socialist government – which came into power just two months ago in the midst of the fiscal crisis – will do “whatever is required” to lower the deficit. Whether the Greek government manages to bring the country’s finances under control remains to be seen. But it is telling that even European socialists realize that budget shortfalls in the ten percent range pose a serious problem and they intend to do something about it.

Many Americans still do not realize that our federal government ran a deficit of 10 percent of GDP in fiscal 2009. But unlike the Greek socialists this administration apparently experiences no sense of alarm or urgency. Quite to the contrary, they plan to spend even more as evidenced by the president’s speech at the Brookings Institution. As if this was not enough, they are also pushing for so-called health reform, which would bleed untold trillion from our collapsing financial house.

In the past we used to laugh at the apparent mindlessness and follies of European socialists. These days, however, they seem less extreme and more reasonable than their counterparts in Washington.

  • Robert Bernier

    Wow! Read this one. It is really good. And this gentleman says it just like it is.

    This venerable and much honored WW II vet is well known in Hawaii
    for his seventy-plus years of service to patriotic organizations and causes all over the country. A humble man without a political bone in his body, he has never spoken out before about a government official, until now. He dictated this letter to a friend, signed it and mailed it to the president. Consult : http://xrl.us/bgeewc

  • inpalinwetrust

    A Little Levity, “Obama Man” by Greg Morton
    http://inpalinwetrust.wordpress.com/2009/12/14/

  • sovereignjim

    No mention of the past and coming bailouts to cover the gambling losses of the Wall Street Banking Cartel created Toxit Assets.

  • LindaRivera

    Obama Says U.S. Long-Term Debt Load ‘Unsustainable’
    By Roger Runningen and Hans Nichols

    May 14 (Bloomberg) — President Barack Obama, calling current deficit spending “unsustainable,” warned of skyrocketing interest rates for consumers if the U.S. continues to finance government by borrowing from other countries.

    “We can’t keep on just borrowing from China,” Obama said at a town-hall meeting in Rio Rancho, New Mexico, outside Albuquerque. “We have to pay interest on that debt, and that means we are mortgaging our children’s future with more and more debt.”

    Holders of U.S. debt will eventually “get tired” of buying it, causing interest rates on everything from auto loans to home mortgages to increase, Obama said. “It will have a dampening effect on our economy.”…
    http://www.bloomberg.com/apps/news?pid=20601087

    Obama admits the terrible financial destruction wrought against Americans. WHY then does OBAMA NOT IMMEDIATELY REVERSE this TRAGEDY?

    A major investor states America is going to reach Zimbabwe hyperinflation.
    http://economyincrisis.org/articles/show/2942

    Billions of dollars urgently needed for America's defense is instead gifted to Islam. Nuclear Iran and nuclear North Korea both state they intend to destroy America. They are not idle threats. The same venomous hate for the U.S. is shared by other nations and Muslim terrorist organizations. The treasonous response of the U.S. government to America's increasing danger, is to drastically reduce our defenses facilitating America's annihilation.

    See: Aloha, “Star Wars” By: Washington Times Editorial
    Washington Times | Monday, June 29, 2009
    http://www.frontpagemag.com/readArticle.aspx?AR

  • LindaRivera

    U.S. BROKE, but BILLIONS for Muslim FAVORITES

    DRUDGE REPORT
    'WE'RE OUT OF MONEY'
    May 23 2009

    In a sobering holiday interview with C-SPAN, President Obama boldly told Americans: “We are out of money.”

    SCULLY: You know the numbers, $1.7 trillion debt, a national deficit of $11 trillion. At what point do we run out of money?

    OBAMA: Well, we are out of money now. We are operating in deep deficits
    http://www.drudgereport.com/flashocs.htm

    CREEPINGSHARIA.COM
    Obama’s Supplemental Bill Passes, Gives Billions to Enemies?
    By creeping

    Barack Obama’s 2009 Supplemental Appropriations for Iraq, Afghanistan, Pakistan, and Pandemic Flu was revised and “passed by the full committee”. Not sure what the next step is, but based on the summary, it gives billions of U.S. taxpayer dollars to countries and entities that support sharia law and/or harbor, hide and support those who want to destroy the U.S. and our allies.

    Read the summary from David Obey’s office that was quietly released last week with nary a word from any media.

    • $3.6 billion, matching the request, to expand and improve capabilities of the Afghan security forces

    • $400 million, as requested, to build the counterinsurgency capabilities of the Pakistani security forces

    • Afghanistan: $1.52 billion, $86 million above the request

    • West Bank and Gaza: $665 million in bilateral economic, humanitarian, and security assistance for the West Bank and Gaza

    • Jordan: $250 million, $250 million above the request, including $100 million for economic and $150 million for security assistance

    • Egypt: $360 million, $310 million above the request, including $50 million for economic assistance, $50 million for border security, and $260 million for security assistance

    • Pakistan: $1.9 billion, $591 million above the request

    • Iraq: $968 million, $336 million above the request

    • Oversight: $20 million, $13 million above the request, to expand oversight capacity of the State Department, USAID, and the Special Inspector General for Afghanistan to review programs in Afghanistan, Pakistan and Iraq

    • Israel: $555 million of the $2.8 billion 2010 request for security assistance, $555 million above the supplemental request. (Note: that means Obama’s original request did not include any money for Israel in 2009)

    • Lebanon: $74 million

    • International Food Assistance: $500 million, $200 million above the request, for PL 480 international food assistance to alleviate suffering during the global economic crisis

    • Refugee Assistance: $343 million, $50 million above the request, …including humanitarian assistance for Gaza. Funding for the UN Relief and Works Agency programs in the West Bank and Gaza is limited to $119 million (Note: Gaza = Hamas)

    • Disaster Assistance: $200 million to avert famines and provide life-saving assistance during natural disasters and for internally displaced people around the world, including Somalia, Zimbabwe, Ethiopia, the Middle East and South Asia

    • Peacekeeping: $837 million for United Nations peacekeeping operations, including an expanded mission in the Democratic Republic of the Congo and a new mission in Chad and the Central African Republic

    • HIV/AIDS: $100 million, $100 million above the request, for the Global Fund to Fight AIDS, Tuberculosis and Malaria to address a funding shortfall for grants in key countries such as Haiti, The Democratic Republic of the Congo, and Afghanistan. (Note: That means Obama’s original request didn’t include any money for AIDs)

    • Africa: $151 million, $18 million above the request, for economic and security assistance for Kenya, Somalia, Southern Sudan, and Zimbabwe

    • Mexico: $470 million, $404 million above the request, to address growing violence along the United States-Mexico border by supporting the Government of Mexico’s war against organized crime and drug-trafficking

    • Georgia: $242 million to fulfill the United States commitment to the people of Georgia

    • Global Financial Crisis: $300 million, $148 million below the request, to address the global financial crisis in developing countries

    • Nuclear Non-Proliferation: $55 million, $34.5 million below the request, for the National Nuclear Security Administration to safeguard nuclear material in Russia and other sites world-wide

    • Department of Justice: $17 million, matching the request, for counter-terrorism activities and to provide training and assistance for the Iraqi criminal justice system

    Updates:

    Mass media remains silent on this but the International News has now picked up the story

    …and then there is Obama’s $108 billion IMF bailout scheme in addition to the Supplemental

    Related:

    To really add insult to injury, check our previous Creeping Sharia post – Obama asks Congress to allow U.S. funds to terrorist Hamas govt

    The Obama administration has asked Congress to let aid to Palestinians continue if Hamas backers are included in a new unity government, observers say. The proposed change in U.S. law would be necessary because Hamas, which controls the Gaza Strip, is designated as a terrorist organization and therefore cannot receive U.S. aid.
    http://creepingsharia.wordpress.com/2009/05/13/

    Whilst homeless shelters are filled to capacity and desperate jobless and homeless, NEGLECTED Americans are living in tent cities, billions are gifted to highly favored Muslims.

  • LindaRivera

    Even though the U.S. is bankrupt, we are engaged in wars we cannot afford.

    Monday, December 14, 2009
    FROM JOSEPH FARAH'S G2 BULLETIN
    WorldNetDaily Exclusive
    It's not just the enemy
    killing U.S. soldiers …
    You won't believe new rules
    of engagement in Afghanistan

    WASHINGTON – New military rules of engagement ostensibly to protect Afghan civilians are putting the lives of U.S. forces in jeopardy, claim Army and Marine sources, as the Taliban learns the game plan based the rules' imposed limits.

    The rules of engagement, or ROEs, apply to all coalition forces of the United States and the North Atlantic Treaty Organization…the Taliban is well aware of them and has its own forces acting in ways to counteract them.

    Critics see the new ROEs being more oriented toward defensive rather than offensive operations, as evidenced by recent charges of murder against two U.S. Army snipers because they had targeted a Taliban commander who reportedly wasn't holding a weapon.

    The actual ROEs are said to be classified U.S. and NATO secrets, but based on individual soldier accounts, those restrictions include the following:

    * No night or surprise searches

    * Villagers are to be warned prior to searches

    * Afghan National Army, or ANA, or Afghan National Police, or ANP, must accompany U.S. units on searches

    * U.S. soldiers may not fire at insurgents unless they are preparing to fire first

    * U.S. forces cannot engage insurgents if civilians are present

    * Only women can search women

    * Troops can fire on insurgents if they catch them placing an IED but not if insurgents walk away from where the explosives are.

    Often, rules of engagement require varying levels of approvals before action can be taken. In one case, villagers had tipped off U.S. forces of the presence of a Taliban commander who was threatening village elders.

    To get permission to go after him, U.S. troops had to get 11 separate Afghan, U.S. and international forces' approval to the plan. The approval, however, did not come until well into the next day. By then, the Taliban commander had moved on, to the consternation of the villagers who had provided the tip. Observers have claimed that it can take some 96 hours to acquire all the permissions to act.

    In other cases, the use of force against insurgents may be blocked if they lower their guns, only to have those insurgents return later to attack.

    Also, ISAF troops cannot engage insurgents if they are leaving an area where an IED has been planted. In one case, insurgents planting an IED had detected the presence of U.S. forces and immediately began leaving the area, tossing evidence of their preparations along the way. U.S. forces could not fire on them.

    The ROEs in some cases have gone beyond limiting ISAF troops in their operations. In one case, ROE restrictions were in effect when four U.S. Marines twice pleaded by radio for artillery support in combat action in Kunar Province in Afghanistan – and twice they were refused, before they were killed.
    http://www.wnd.com/index.php?fa=PAGE.printable&

    Unethical American leaders are to blame for the killing of our four U.S. Marines. How many more Americans and allies will be killed and maimed because of U.S. rules that highly favor cruel enemies? This is NOT a war that is being fought to win. Just the opposite. Stop the ruthless abuse of our military. Save the lives of our troops and allies! Bring them home now!