Time For Boehner To Go Soon

The CATO Institute shows that the "Boehner Plan" proposed in the House is the usual Washington, farcical proposal that claims to cut spending, when it reality, it only slows the growth from ridiculously outrageous to merely outrageous.

CATO also points out that it's been 9 months since a massive landslide election based on the theme of dramatically cutting government spending.

I like Boehner and think he is a decent, if gullible, politician. Even though he controls only the House and a plan would never be passed by the Democrat-controlled Senate or White House, he needs to pass a serious budget-cutting plan that will likely be labeled "draconian," "granny killing," etc. The only reason the GOP has the majority in the House is because people voted for them to cut spending. He's not trying, so he needs to go soon.

On the debt ceiling, there are a few options, two of which I would support Boehner as Speaker:

1) Listen to the Dems and raise taxes and/or don't cut spending. This is the likely scenario and if passed, Boehner should resign immediately.

2) Pass a bill to send to the Senate and then hold firm when they send back a Reid bill with (1) above. This would result in not meeting the debt ceiling by August 2, which would be fine in my opinion even if it triggers a temporary government shutdown until the Democrats get serious about the crisis. (The only thing that would not get paid are certain "fat cat" salaries in Washington, which is hardly a crisis.)

3) Pass nothing and wait for the White House for their specific plan. (Somehow no one is blaming Obama for this mess and it's because he hasn't presented anything specific to upset anyone even if he knows the status quo is the truly radical solution.) Again, this would likely result in a temporary government shutdown, which is fine by me.

Let's not forget what got us here. Three straight years of $1.5 trillion deficits, all while Obama/Pelosi/Reid were in charge (sure, with some help from the previous 43 presidents but to a much lesser extent). Need to just go through the temporary pain to right the ship and that time is now.

UK Rationing Surgeries: The Future of Obamacare

Everyone knew it would be inevitable, and now the UK health service is rationing all sorts of surgeries for cataracts, knees, hips and tonsils. Welcome to Obamacare's future in the U.S.

But hey, it's free (if you ignore the taxpayer cost)!

President's Speech Not Boring Enough!

Even though President Obama's prepared speeches are pretty predictable, robotic, passion-less, and uninspiring, I figured I'd tune into his latest primetime speech to see what he would say.

First, the President strutted out to his podium and zeroed in on reading his teleprompter - pretty predictable stuff. His first few words bring us back to 11 years ago - year 2000 - as he continued to blame his predecessor for the enormous deficit we have today. He blamed the tax cuts and Bush's stimulus for the problem. He blamed the two wars on his predecessor. Then he blamed Kennedy-Bush Prescription Drug Bill. (He didn't mention that Democrats supported both wars, and the prescription drug bill and didn't mention that he personally tripled the troops in Afghanstan.

The President then fabricated a few facts - indicating that he inherited a trillion dollar deficit. I could say this is an outright lie, but I will give him the benefit of the doubt on this. Ok - Bush's deficit in 2007 was 1% of GDP - then in 2008 it grew to about 3% after a few bailouts and a short term stimulus. Ok - If you include TARP under Bush, then we can add 5% to this figure and maybe that's what he's doing. But 85% of TARP has been paid back in later years so the President is clearly being disingenuous when talking about this inheritance. Again this is usual stuff and not surprising at all that the President did this.

What I really didn't like about the President's speech though was two things:

1. He did it in an empty room, and refused to take questions (no transparency)
2. He said clearly about his "plan": "I won't bore you with the details."

Please Mr. President - bore us! I think the public wants details and needs details of his plan (if there are any). That's what this whole debate is missing - details! How do we know the President's "cuts" are really cuts? Or are they really just smaller spending increases? Where is he cutting? What are the specifics?

I don't expect the President to rise above political posturing and that he'd stop blaming his predecessor, or fabricating facts. But regarding the debt plan - I want details. Please Mr. President - bore us even more!

Gang of Six Tax Increase Proposals

The Senate's bipartisan "Gang of Six" is a disaster. They buy into Obama's rhetoric that the government needs more money. This, despite the fact that spending has gone from $2.7 trillion per year to $3.7 trillion since Pelosi and Reid have controlled Congress in 2007. A 40% increase in the size of the government since the recession began but we still need more?!?

So the gang of six says sure, and by news accounts, is threatening to eliminate all sorts of deductions for the "wealthy" including 401-Ks and mortgage deductions - and perhaps even capital gains. Regardless of what the deal might look like, the premise that the government needs more money is completely absurd.

Steve Wynn Slams Obama: "Worst in My Lifetime"

It's always refreshing to hear business leaders speak truthfully.

Wynn, the CEO of Wynn Resorts (WYNN), called the administration the “greatest wet blanket to business and progress and job creation in my lifetime.”

In particular, Wynn criticized Obama for a “lack of leadership” and Washington for excessive regulation and escalating health-care costs.

“I’m telling you that the business community in this company is frightened to death of the weird political philosophy of the President of the United States,” Wynn said. “And until he’s gone, everybody’s going to be sitting on their thumbs.”

Kennedy Finds Religion on Alternative Energy Costs

Robert F. Kennedy Jr., writing in the WSJ, sounds an awful lot like a conservative when railing against the costs of a Nantucket wind farm for Massachusetts taxpayers. If I didn't know any better, I would think that his arguments make a ton of sense and have nothing to do with the Kennedy unobstructed views from their Cape Cod home(s).

For once, I agree with a Kennedy. Spending gobs of federal dollars for a project that is not only an eyesore, but makes electricity prices significantly more expensive, is a waste. Sort of like most federal spending today...

Obama: 80% of Americans Want Higher Taxes

Obama is so out of touch it is laughable. Really - 80% of Americans want higher taxes?

That's quite a different line than the one he sang 7 monhts ago when he said raising taxes would kill jobs...

Obama, Reid Hold Social Security Payments Hostage

Harry Reid and Barack Obama have now both promised to withhold social security payments if there is no increase to the debt ceiling. This despite the fact that social security payments make up only a tiny fraction of the $200 billion in monthly revenue that the government receives.

President Man-child Pouts, Walks Out of Talks

The petulant man-child Obama couldn't get his way in talking to House leaders about raising the debt ceiling cart blanche, so he pouted, "enough is enough" and abruptly walked out of the talks.

Is this how a president acts - or a 6-year old child? Even when Democrats controlled both chambers in Congress, they couldn't manage to increase taxes to pay for Obama's unprecedented spending binge. Now Obama wants the GOP to do it instead. Question: would you rather have a technical default now or a real default in a couple of years? Based on the Obama policies, it's going to happen one way or another.

McConnell To Give In To Obama on Debt Increase?

Can someone explain why the Democrats' massive spending increases have suddenly become the GOP's problem? And further, why it appears that McConnell is giving Obama everything he is asking for - an unencumbered way to raise the debt limit without altering ANY spending at all?

Since just 2008 when Pelosi, Reid and Obama have been in charge, federal spending has increased by approximately $1 trillion per year (before Obamacare, Dodd Frank and the like, which will drastically increase this number). And yet Democrats claim that the only option is to keep spending and increasing the debt by unsustainable amounts?

If McConnell gives in to Obama, the GOP might as well not run a candidate in 2012 and just accept defeat, along with the bankrupticy of the USA.

...Mitch McConnell has quickly forgotten why the Tea Party voted the GOP in last year in a massive landslide - it wasn't to give Obama free reign over the taxpayers' checkbook.

Why Obama Has Not Passed a Budget in Over Two Years

We've heard it many times before, mostly from the President himself - he's making history. Unfortunately there are few people that think his political tactics regarding the budget is good history. But as of today, as Michael Graham from the Boston Herald points out, the democratically-controlled congress has not passed a budget in 800 days! Over two years. To put it into context:

..the last time Senate Democrats passed a budget, Ted Kennedy voted for it.

Last year Obama passed no budget. Why? It was an election year. My guess is that he voted present for two reasons: 1. If he voted to cut expenses, he figured his party would get crushed. 2. If he voted to increase expenses, he figured his party would get crushed. Well, at least Obama was right on one thing: his party got crushed.

But here we are one year later and now Obama is playing politics to help himself - this time to get him through the 2012 elections. Most helpful to Obama would be an extension of the debt ceiling so the Fed can continue printing money and so he has a chance at re-election.

It's true that increasing debt might give a short-term jolt to the economy. MIGHT. But might NOT as well. There's just as good a chance that the international community shuns Obama and tells the Fed to take a hike - meaning a hike in interest rates because of the increased risk associated with more debt. And regardless of the short term impact, the long term impact will certainly be a very big negative for years, and I fear, decades to come.

If the Republicans don't hold firm on this one, I fear the worst. Batten down the hatches.

9.2%

Private payrolls expanded at only 18,000 last month, a fraction of what was expected, with unemployment rising to 9.2%.

Companies still don't want to hire with all of the pending new regulations from Obamacare to Dodd Frank to the EPA and FDA. Sad.

Obama: Taxpayers Should Pay Mortgages For Unemployed

True to form, new changes proposed by Obama's administration would allow unemployed people with FHA-backed mortgages to live rent-free in their homes for a full year.

Spending slowdown? What spending slowdown? This is just an end-around to spend more money.

President Does not Understand Money

Last week I heard Harry Reid speaking, and he was complaining about the tax breaks that go to "millionaires and billionaires." President Obama also has frequently made the same complaints about "millionaires and billionaires."

I have to laugh when I hear politicians lumping millionaires and billionaires in the same bucket, because it simply means that they don't have a clue about money. And if Sarah Palin were to say it, people would surely report how ridiculous it is.

Let me explain the difference as I see it: say you graduate high school, and then work as a janitor for the next 50 years of your life. Let's say you make $40,000 per year. Now if you save your money every year and don't overspend, you will have accumulated $2 million in earnings over your lifetime. Of course you have expenses and taxes to pay, but then again, if you save wisely, your money will have grown compounded as well. You could easily be a millionaire by retirement age.

Now to become a billionaire: same thing, except instead of making $40,000 per year you would need to find a job paying $40 million per year over 50 years. See the difference?

One could also lump those who have a $1000 in the bank with those who have accumulated $1 million - it's the same difference. So next time you hear someone complaining about millionaires and billionaires, you need to ask yourself: does this person get it?

Obama's SPR Release a Dud

Well, Obama decided the release 5% of the US's strategic petroleum reserve on June 22nd - this was his attempt to control inflation, and was most likely a ploy to help his re-election chances. Since then, the price oil immediately declined by 4-5%, but has since rebounded, and is now above it's June 22 price level. Anyone who understands a tiny bit about the economy could have predicted this result. Sadly, our President is not in this camp.

So we got about 2 weeks of slightly cheaper oil. What's next?

Your Next Door Neighbors in Debt

Say you have new neighbors. Typical American family - 2 kids, a dog, both parents work. You happen to notice that the wife drives a Merc and the husband, a Porsche. No big deal - they like cars. As you get to know them you also notice that their children go to the most expensive pre-school in the state. Again, no big deal - good for them - you're glad they're being well-educated. Several times a year the couple ask you to watch their house, as they are ski and golf enthusiasts - often vacationing in the Alps or golfing at Pebble Beach. Again, great that your neighbors know how to enjoy life. Their dog happens to be a rare breed only specially bred by Swiss breeders - again you're happy they have a quality dog.

One day you find out that your neighbors work as volunteers for a homeless shelter, and so their income is minimal. They tell you, however that they have never had a problem getting large bank loans and that they have accumulated over $1 million dollars in debt with minimal income to speak of.

Then one day the bank refuses them additional loans. The couple go from bank to bank but are continually refused. Eventually they seek your advice. You, as a financial planner, look at the couples' expenses and give them a simple remedy - sell the cars, eliminate the luxury vacations, sell the dog, send the kids to public schools, and lastly, they should seek higher paying jobs. The couple say that this is impossible and decide that the best solution is to continue to look for a bank or a loan shark that will help them continue with their lifestyle.

This is obviously a ridiculous situation which most of us cannot envision happening. As ridiculous as this sounds, a similar situation is occurring today. Unfortunately for us, the couples' name is Obama.

Teen Employment Predictably Plummets

While Democrats seem oblivious to the simple laws of economics, the reality of teen unemployment this summer is clear. As the WSJ points out, raising the minimum wage from $5.15 to $7.25 per hour has had a significant negative effect on teenager hiring, particularly among black teens, whose unemployment rate went from 29% to 41.6%.

And their policies have worked so well that the Obama White House is now thinking of raising it again to $8.25, somehow arguing that this will actually create jobs.

This is what we get when an administration has fewer than 10% of its bureaucrats with any private sector experience...