Ending the Shutdown

                We are now in the third week of the partial government shutdown.  Senate Majority Leader Harry Reid (D-Nevada) and Senate Minority Leader Mitch McConnell (R-Kentucky) believe they are nearing an agreement to reopen the federal government and defuse the upcoming debt crisis. 

                “The latest proposal would reopen the government at current spending levels until January 15 and extend the federal borrowing limit until early February, according to aides familiar with the talks.  Lawmakers also would begin longer-term negotiations on the budget, with the task of reaching an agreement by December 13.”

                It sounds to me as though they are “kicking the can down the road” – again - rather than settling the problem.  It appears that they are simply setting some future deadlines that will look a lot like the one they are supposedly dealing with at the present time.  Many lawmakers apparently feel the same way.  Senator John Thune (R-South Dakota), a member of the Senate GOP leadership, voiced the frustration:  “Everybody realizes that whatever happens, we’re going to be litigating this [on] another day.”

                While members of Congress are debating the debt limit, spending cuts, Obamacare, and government funding, we must remember that the Republican majority in the U.S. House of Representatives passed several bills that would fund the government and others that would reopen portions of the government, but all the House bills were rejected by the Democrat-controlled Senate.  I wonder if the Senate will ever pass a real budget as long as Harry Reid is in control!

                The Heritage Foundation reminds us that there are two things that Congress cannot ignore:  Obamacare and spending cuts.  Obamacare has not yet been fully implemented but “is negatively impacting people.”  It also creates additional entitlement programs that would join the ones that are already “driving our spending and debt crisis.”

                “What Romina Boccia, Heritage’s Grover M. Hermann Fellow, wrote in August remains every bit as true today:  `It is irresponsible for lawmakers to spend valuable negotiating time on how they can spend more of taxpayers’ money on discretionary programs when they should be pushing for an agreement to resolve the spending and debt crisis brought about by entitlement programs.  Defunding Obamacare should be their first priority.  Congress should cut spending and fix the real debt crisis – out-of-control entitlement spending – before or as part of any increase in the debt ceiling.’

                “Obamacare and out-of-control government spending are holding back our economy and keeping people from jobs.  These are two monsters Congress and the President cannot wish away.”

                It appears more and more certain to me that we will have to replace some of the “Old Guard” Republicans and many Democrats before we will be able to really take back our country.  Are you up to the task!

Debt Brings Slavery

It seems only fitting that the liberty principle for this Freedom Friday should be economic freedom - particularly the importance of avoiding debt. The United States lost its sterling credit rating last week when Standard and Poor's downgraded America's debt from AAA to AA+. This downgrade came as a result of our leaders' inability/unwillingness to reduce our nation's debt.

President Barack Obama and his cohorts are either uneducated as to the effect of debt on individuals, families, states and nations - or they are using our nation's debt to advance their own agenda. Debt is a form of "involuntary servitude," and it can enslave us as surely as conquest by military means.

W. Cleon Skousen defined debt as "simply borrowing against the future. It exchanges a present advantage for a future obligation. It will require not only the return of the original advance of funds, but a substantial compensation to the creditor for the use of his money" (The Five Thousand Year Leap: 28 Great Ideas That Changed the World, p. 205).

Skousen explained that the Founders understood that the ability to borrow funds in a time of crisis is "an honorable procedure" and "looked upon it as a temporary handicap which should be alleviated at the earliest possible moment. They had undergone sufficient experience with debt to see its corrosive and debilitating effect, which tends to corrupt both individuals and nations."

Our leaders over the past one hundred years have been much different than our Founding Fathers. Our Founders abhorred debt and considered it to be "like a plague." They considered "excessive indebtedness as a form of cultural disease." If our modern-day leaders had followed the example set forth by our Founders, our nation would not be more than $14 trillion in debt today, and we would not have lost our best in the class credit rating.

Our Founders understood that the debts of a nation are no different than the debts of individuals. The fact that the responsibility for debt is shared by many does not make debt any less dangerous. The ability to borrow from friends - not enemies - at a time of crisis is good. Wars and other emergencies are expensive and often require debt. Our Founders understood this situation and authorized debt for emergencies when writing the United States Constitution; however, "they considered it a matter of supreme importance for the survival of a free people to get out of debt and enjoy complete solvency in order to prosper." (Above quotes are from Leap, pp. 205-214.)

JD Foster of The Heritage Foundation explained what the credit downgrade really means to us: "A credit rating downgrade will eventually mean higher interest rates on U.S. government debt. This may be hard to imagine given the recent drop in Treasury bond rates in response to events overseas. . But higher future rates are certain, and that means that even more federal tax dollars must be dedicated to paying the interest on past government excesses. Higher interest rates and interest cost means greater deficit pressures, which can mean more debt, which can lead to higher interest rates. This is why it is termed a debt spiral."

Foster continued with his explanation: "While not solely to blame, President Obama and his allies are most certainly preeminently to blame. Facing a rapidly growing budget deficit in 2009, President Obama pushed through a massive fiscal stimulus program followed by a succession of lesser efforts. As the anemic state of the economy attests quite clearly, those programs failed miserably - except in raising federal spending and national debt.
"Then the President pushed through his disastrous and highly unpopular health care reform. On paper, these reforms give the appearance of improving the fiscal picture modestly. But as the Medicare trustees' report has reminded us every year after ObamaCare passage, this happy picture is an illusion. Aside from the damage it has done and will do to health care costs and services, from a fiscal perspective, Obamacare ultimately is just yet another unaffordable entitlement piled on top of those already on the books."

We must cap our spending, cut our entitlement programs and shrink our government. We simply cannot pay our debts by raising taxes, even by raising the taxes of the wealthy people in our nation. Even the wealthy do not have enough money to pay our nations debts. The only way we can get out of debt - or even get our good credit rating back - is to cut the spending. Cut, Cap and Balance was a good plan, much better than what we got.

I believe that there is only one way to pay our debts and live in economic freedom again. Our Founders set forth the way to conduct our government, and it worked for over a hundred years before progressives began to set up unaffordable entitlement programs that have led to our current debt situation. The only way that we can solve our fiscal problems is to return to the formula set forth by our Founders - the fundamental principles found in our Constitution. The Tea Party may be hated in our nation, but they know what we must do. They know that we are Taxed Enough Already (TEA) and are making their voices heard. This is a good time for all Americans to join the TEA Party!

Compromise

After spending many weeks of debate and intensive personal negotiations, a compromise was made to raise the debt ceiling and end our current debt crisis. The drama of the past few weeks put the economy of our nation at risk and concerned Americans and people worldwide.

Compromise has been defined as a settlement between two individuals or groups where each side agrees to give up part of what he/she demands. The compromise about the debt ceiling has left both sides unsatisfied, and the fight over fiscal responsibility will continue. The more I study the situation, the more I realize that the current bill does not do much at all in solving our fiscal crisis.

Americans are disappointed because the debate over the debt limit was more about what was good for politicians than about what was good for the nation. Americans are disappointed because we are saddled with a broken government that refuses to fix itself. Americans are disappointed because the Budget Control Act does not solve the fiscal problems of America.

In a letter to conservatives, Edwin J. Feulner, President of The Heritage Foundation, outlined several elements of the current bill that he considers to be unacceptable:

1) There is no reassurance that this plan will "protect our nation's AAA credit rating." A statement from Moody's last Friday said that "neither the Boehner nor Reid proposals would restore our solid credit footing. This plan did not improve upon those. Economists from Barclays Capital in London said of the deal: `Overall, our first impression is that the agreement by itself is unlikely to be sufficient to cause S&P to remove the U.S. from being on ratings watch for possible downgrade.'" There is still a possibility that a downgrade will take place.

2) Our national security will be put at risk. "If all [defense cuts] are imposed, we will have a trillion dollars less than we need to protect our nation and defend its interests."

3) There will be more tax hikes. President Obama reassured his liberal base that more tax hikes will come from the special committee.

4) Conservatives believe that "Congress should balance its budget year-in and year-out," and they missed a good "opportunity to drive spending down toward a balanced budget." This debt compromise "does little to advance the cause of a balanced budget amendment to the Constitution. Not all balanced budget amendments are created equal. We need an amendment with proper taxpayer protections so that Congress can't simply hike taxes to balance the budget."

5) Americans want their representatives to stop ducking responsibility and "make the tough choices to reform entitlements. The special committee of half-Democrats and half-Republicans will probably not do much to solve the situation.

These elements of the debt plan are not the only problems with it. "Conservatives put up a good fight for the non-defense spending cuts needed to reduce the size and cost of government. While Senate Democrats sat on their hands for 800-plus days, doing nothing, House conservatives introduced and passed the Ryan budget plan and the Cut, Cap, and Balance Act, each of which was a step in the right direction."

Even though conservatives are disappointed with the debt deal, they can feel good about what they accomplished. The biggest change made was "progress we made changing the dialogue in Washington. Just as with the Ryan budget plan, we are talking in terms of spending cuts for a smaller, less costly government, not spending increases. Popular opinion is with the conservative philosophy of limited government."

Although conservatives made progress, we have to realize and admit that "this debt increase was the highest in history. This is not surprising, given the record spending increases and deficits we've witnessed over the past two years." Any sane person realizes that our nation cannot continue to spend more than we take in. If we stay on the same course, we will not be able to stay creditworthy, create jobs or grow our economy.

Feulner stated that we must continue to pursue entitlement reform and revenue-neutral tax reform while at the same time maintaining a strong military in order to defend America. In order to do all these things, Washington must "get serious about spending and regulation.
The Heritage Foundation did what Congress should have done but failed to do when they published a plan called "Saving the American Dream: The heritage Plan to Fix the Debt, Cut Spending, and Restore Prosperity." [savingthedream.org/?...] It covers tax reform, health care and Medicaid, Medicare, Social Security, and government spending, and it tells how it will affect millennials, families, low-income workers, entrepreneurs, baby boomers, and retirees. This plan is said to be able to "fix the debt, cut spending, and restore prosperity."

As conservatives we can feel good about the "ground we have gained," but we must not stop fighting for the fiscal salvation of our nation. We apparently had to make a compromise at this point, but the battle will go on.

Debt Crisis

My oldest son called me a night or two ago to tell me how upset he was at "my" Congress. I reminded him that I voted for only one member of Congress, Representative Don Young, and I told him that I didn't claim any responsibility for either Senator Begich or Murkowski. He didn't accept my reasons for why I'm not responsible for what Congress is doing and told me that he was blaming me anyway - probably because I am so conservative.

My son was really angry and expressed thoughts similar to those of many Americans: None of us care if any of the politicians are re-elected, but we do care about the national economy and our own personal financial situations. We want our representatives to take care of the business they were elected to do and stop thinking about their own futures. We think the politicians on both sides of the aisle are acting childish and petulant in not coming to an agreement that will be best for the United States of America. He made the statement that we should "lock them in a room" and not let them out until they come to an agreement.

As I write this post, the media is reporting that an agreement has been reached between Speaker of the House John Boehner, Senate Majority Leader Harry Reid, and President Obama; however, the Senate and the House of Representatives still need to vote on the matter and either or both could vote "no" on passing it.

The agreement apparently has two "steps" to it. The first step would raise the debt ceiling immediately by almost $1 billion and cut federal spending by a slightly larger amount over a decade.

The second step would involve the creation of a new bipartisan congressional committee - six Democrats and six Republicans, three of each from the Senate and three of each from the House - that would have until November to recommend $1.8 trillion or more in deficit spending. Their target is supposed to be benefit programs such as Medicare, Medicaid and Social Security or making changes in the tax code. New deficit cuts would allow for another increase in the debt ceiling. If the committee failed to reach the target of $1.8 trillion or Congress failed to approve the recommendations of the committee, it would automatically trigger a congressional vote on a constitutional amendment to balance the budget. If the amendment failed to pass Congress, spending cuts totaling $1.2 trillion would automatically take place, and the debt ceiling would rise by the same amount. The automatic cuts would not include Social Security, Medicaid or food stamps.

It appears that the current debt crisis may be over for now, and both liberals and conservatives can claim that they won. The budget battle is apparently over until after the 2012 elections, but fiscal problems will continue as long as Americans rely so heavily on the federal government and as long as the government borrows nearly half of every dollar it spends. The entitlement programs have been off the table for now, but they will consume our entire budget in future years unless they are trimmed. There is still much work to do on the fiscal problems of our nation, but for now it appears that we can all breathe a sign of relief.

Cut, Cap, Balance

The worldwide debt crisis has been much in the news in recent months, and the debate about raising the United States debt ceiling has been loud, raucous, and not settled yet. It is no secret that our huge government debt was caused by our elected officials in Washington, D.C. - both Republicans and Democrats - who deliberately made and passed bills that put our nation's fiscal health in danger. Our nation now owes at least $14.3 trillion. Our elected leaders are borrowing about forty cents of every dollar they spend. We cannot continue on the path that we are currently traveling.

I have been watching the issues closely and reading as much about it as I possibly could, but I still do not understand much about our problems. I have noticed that liberals are adamant about the need to raise the debt ceiling so that we can even more money and go even further in debt while conservatives are opposed to raising the debt ceiling without cutting the deficit and capping future spending. A coalition made up of conservatives and libertarians put forth a plan to stop this out of control spending. Their stated goal is to keep Congress from raising the debt ceiling unless they also cut, cap, and balance federal spending. The U.S. House of Representatives passed the "cut, cap, and balance" deficit reduction plan on Tuesday, July 19, 2011, by a bipartisan vote of 234-190 (229 Republicans and 5 Democrats voted for it). The U.S. Senate voted on Friday, July 22, 2011, to "table" or kill the House Republican proposal by a vote of 51-46 along party lines. Senate Majority Leader Harry proclaimed Cut, Cap, and Balance to be dead.

What is Cut, Cap, and Balance? Why are liberals so opposed to it? H.R. 2560, The Cut, Cap, and Balance Act, is basically just what it says. Cut the deficit immediately. The deficit last year alone was $1.6 trillion and must be halved for this year. Cap the spending. The historical rate of federal spending - before the Obama Administration - was 18% of GDP or less. In order to protect our nation from out of control politicians, we must put a cap on spending at the historical level. Balance the budget. We must pass a Balance Budget Amendment because we cannot trust politicians from either party. We know from the actions of politicians in the past - Republicans during the Bush Administration and Democrats in the Obama Administration - that we cannot trust them to spend our money wisely. Simply stated, Cut, Cap, and Balance is an effort to restrict and control politicians while saving and strengthening our freedoms. If it were made law, Americans would again be free to prosper and thrive.

Why are liberals so opposed to cutting our deficit, capping our spending, and balancing our budget when the majority of Americans are supportive of doing so? I do not know why. I cannot understand their unwillingness to do so. It appears that liberal/progressive Democrats are being irresponsible about our debt: the Senate has not passed a budget for over 800 days, and neither President Obama nor the Senate has come up with a plan to solve our fiscal problems.

President Obama called for a "balanced" plan, and stated that he wanted a "shared sacrifice." Yet, when the House put forth such a plan, he said that he would veto Cut, Cap and Balance if it were passed by the Senate.

Fox News.com reported the following statement from Senator John Cornyn (R-Texas): "The Democrat-led Senate's failure to both produce a budget and pass the Cut, Cap, and Balance Act of 2011 underscores the Democrats' irresponsible commitment to the status quo. While the President and Senator Reid refuse to produce a plan to deal with our debt crisis, Republicans will keep working to meet the nation's fiscal challenges."

John Boehner (R-Ohio), Speaker of the House, was reported as saying, "Senate Democrats have defied the will of the American people who overwhelmingly support real spending cuts, caps on future spending, and a balanced budget to create a better environment for private-sector job growth.
"Republicans are standing with the American people and, as I've said before, will not pass a bill that fails to cut spending by more than it increases the debt limit, restrain future spending, or that raises taxes on families and job creators."

It appears to me that liberal/progressive Democrats are using smoke and mirrors in order to withstand the control of Cut, Cap, and Balance. Republicans who are not conservatives (RINOs) are sabotaging efforts to stabilize our fiscal situation. The situation has to be faced as soon as possible. The longer we allow the President and Congress to freely throw our money around, the worse the situation will become. If we don't get the borrowing and spending under control now, we will lose our ability to borrow anything or at least have a worse credit rating to deal with.