Debunking the callous-America myth

Over at Mirror of Justice, Greg Sisk takes down the liberal canard that the United States of America has failed to commit financial resources to development of its poor. Unlike his intellectual opponents, he uses facts. Lots of them.

For example, government spending in 2007 consumed $4.9 trillion, 35.9% of our gross domestic product. Sisk states, "Of that government spending, social spending constituted some 55.8 percent of total spending, totaling more than $2.88 trillion."

Think about that number for a moment. That's "trillion" with a "t". Furthermore, Sisk points out that "the percentage of the federal budget devoted to defense has plummeted while social spending has skyrocketed."

Finally, the average American begins working on January 2 each year and doesn't start taking money home until May 1. Everything she earns before May 1 goes to the government. And while she is not taking money home, she is not able to give to charitable organizations, which are able to help the poor much more effectively than government bureaucrats. This graph effectively illustrates the problem:



It is worth noting that Barack Obama proposes to make this problem worse by increasing expenditures on federal entitlements for the poor. In short, the claim that America is not serious about assisting the poor and needs to take a more liberal, compassionate (profligate) posture toward state spending is hogwash.

On saying one thing, and doing another...

Investor's Business Daily:

Fiscal Policy: The Senate's new $3 trillion budget for 2009 is big, but it fails to do something vital to the U.S. economy: extend President Bush's tax cuts. If this isn't fixed, we'll soon face the largest tax hike in our history.

The Senate's action on Wednesday to approve the spending plan came on a 48-45 vote over Republican objections. The House is also expected to pass the measure this week.

Democrats sounded almost giddy. The budget "will strengthen the economy and create jobs," said Senate Budget Committee Chairman Kent Conrad, a North Dakota Democrat. "It will provide tax cuts for the middle class, and it will restore fiscal responsibility by balancing the books by 2012 and maintaining balance in 2013."

Fine-sounding sentiments all. But parse those words for a moment. Virtually everything Conrad says is false, and in no small way.

Read it all.

Incidentally, budgeting like this is exactly what we will get, and worse under an Obama Administration.

On being a permanent minority Party

The feckless Republicans are still at it:

Operating outside public view, the House Democratic majority is taking extraordinary steps to maintain spending as usual while awaiting the arrival of a Democratic president. Remarkably, the supine House Republican minority hardly resists and even collaborates with its supposed adversaries.

There has been little public Republican protest over the seizure of the appropriating process by House Speaker Nancy Pelosi and her clique. For the second year, no appropriations bill other than defense is scheduled for passage. Instead, spending details are crafted in the speaker's office, negating President Bush's veto strategy. In a little-noticed maneuver on April 23, Pelosi won passage of a bill preventing billions from being saved through Bush administration Medicaid regulations. Despite the GOP leadership's nominal opposition, House Republicans voted 2 to 1 for higher spending.

Adding in Pelosi's unprecedented tactics in blocking the Colombian free trade agreement, she has in 16 months established herself as one of the most powerful speakers ever. The stunning aspect of Czar Nancy's rule is the degree of Republican acquiescence. Neither the loss of their House majority in 2006 after 12 years nor the prospect of more losses this November has toughened the Republicans.

More:

House Republicans had another chance last Thursday to demonstrate interest in restoring their anti-waste credentials. Republican Rep. Jeff Flake of Arizona offered a proposal to keep the individual limit on direct farm payments at the current $40,000 instead of raising it to $60,000, as the House did earlier. The state of the GOP is indicated by the fact that even though Flake's proposal failed, the 104 to 86 supporting vote by Republicans was seen as progress. Voting against it were Blunt, Republican Conference Chairman Adam Putnam and Republican campaign chairman Tom Cole.

Sadly, this is par for the course in Congress. It is why I keep saying their must be wholesale change in personnel. New faces with new voices need to be elected to Republican leadership. The current leadership structures within the GOP are incapable of putting forth a compelling vision for conservative governance. They are incapable because they are part and parcel with the old regimes that have been part of the corruption and complacence that the American people now overwhelmingly associate with the Republican Party.

As much as I bristle at the thought of strengthened majorities for liberal post-2008, I do think (hope is probably the better term) the GOP congressional bloodbath at the polls will provide a window of opportunity for conservative reformers to push the Party in the right direction.

More bailouts

The Wall Street Journal has been all over this:

Congratulations! You and your fellow taxpayers will soon be the proud owners of a multibillion-dollar portfolio of student loans. And a leading Member of Congress promises that this pretty bundle of debt comes to you with no cost and no risk. President Bush apparently agrees.

Will this ever end?

2008 should be known as the Year of the Bailout. The Wall Street Journal explains the latest:

Guess who's asking Treasury Secretary Hank Paulson and Federal Reserve Chairman Ben Bernanke for a bailout now? Hint: They are members of an exclusive club who bet wrong on the credit markets last fall. No, it's not a cabal of Wall Streeters, but Democrats in Congress.

We're referring to the "student loan crisis" now appearing in a media outlet near you. In September, Congress vowed to make education more affordable by passing the "College Cost Reduction and Access Act." The law reduced the interest rates borrowers pay on federally insured student loans. Backed by the Federal Family Education Loan Program, these loans account for more than 70% of education lending. Taxpayers will fork over $7 billion by 2012 to pay for the rate cuts.

The cost of freedom

Antiwar liberals in Washington have taken too a new line of attack of late. With the 5-year cost of the war in Iraq closing in on $1 trillion, they sense an opening. The war, they say, is the reason for a declining economy. The war is the reason we cannot have universal government-run health care. The war is the reason we cannot be responsible and reign in entitlement spending that threatens to bankrupt the nation in the near future.

Thankfully, Larry Kudlow blows this argument up in his column today:

First point: The U.S. has spent roughly $750 billion for the five-year war. Sure, that's a lot of money. But the total cost works out to 1 percent of the $63 trillion GDP over that time period. It's miniscule.

But here's the real question we ought to be asking: What is the cost of freedom? While the Left refuses to acknowledge it, the U.S. homeland has not been attacked since September 11. Right there is a big economic plus. Since President Bush went on the offensive and took the battle to Iraq, al Qaeda and other extremist terrorist groups have been utterly routed by U.S. forces. But in tying the jihadists down on their home turf, and keeping them from mounting another coordinated attack on the U.S., our economy has benefited incalculably.

Then again, the anti-war forces might want to recall John F. Kennedy's inaugural address, in which he called on Americans to "Let every nation know, whether it wishes us well or ill, that we shall pay any price, bear any burden, meet any hardship, support any friend, oppose any foe, in order to ensure the survival and the success of liberty."

Do these folks actually think 1 percent of GDP is too large a price, too heavy a burden? I sure hope not.

Now, let's talk numbers:

And by the way, despite the current slowdown, the U.S. economy has performed remarkably well during the five years of the Iraq war. Real GDP has increased by 16 percent, or 3 percent annually. The unemployment rate has hovered below a historically low 5 percent for quite some time. Nearly 10 million jobs have been created. Household net worth has increased by $20 trillion. Industrial production has expanded by 13.5 percent. Even home prices, despite the current correction, have increased by 20 percent.

But this matters not to Washington liberals. They see a sticker price approaching $1 trillion and they immediately begin to think of a liberal wish list of policies that they could purchase for the same price. This is their real motivation for cutting funding for Iraq; to funnel it towards their big-government Utopian schemes.

Dems planning to hold war funding hostage for liberal spending

Congressional Democrats have been buzzing incessantly of late about a second "stimulus" package in the wake of Bush's package past last month. The Bush economic stimulus bill, which conservatives rightly criticized, has given Democrats license to spend like the drunken sailors they are. Despite the fact that the checks for the first stimulus have not even been printed, Americans are about to be saddled with more deficit spending.

This time though, it will be tied to funding for the Iraq war and it will be directed to liberal spending priorities rather than direct tax rebates. The NY Times reports on the high-stakes game of political chicken:

It is not easy to draw a straight line from the slumping economy to the war in Iraq and a trade deal with Colombia, but Democrats are trying to connect those dots.

Party strategists say that President Bush’s opposition to additional economic recovery proposals and his strong support of the trade pact provide an opportunity to portray Mr. Bush and his Republican allies, notably Senator John McCain, as being insensitive to the economic struggles of Americans while spending billions each month on Iraq.

“There is an economic argument to be made,” said Senator Amy Klobuchar, Democrat of Minnesota. “This administration has not done what it should for the middle class.”

Senator Harry Reid of Nevada, the majority leader, said Tuesday that he was preparing to link the war spending directly to the economy at home by using a pending bill to finance combat in Iraq as a proxy for a second stimulus measure. He plans to try to attach to the Iraq money Democratic favorites like an extension of unemployment benefits, a summer jobs program and perhaps local building projects.

“That will be war,” promised Senator Richard M. Burr, Republican of North Carolina.

As it should be.

Free Money!

The New York Post nails it with this headline:

January 25, 2008 -- The Bush administration and House leaders yesterday announced a tentative deal on a proposed $150 billion economic stimulus plan.

Their solution?

Free money!

That's the crux of the proposal, which would send rebate checks of at least $300 to all Americans earning up to $75,000 a year, plus some added relief for mortgaged-strapped homeowners and businesses making capital investments.

Some of this is surely good news.

The Senate is not yet on board, so it's necessary to wait to see what finally emerges from the congressional sausage factory.

But at least for now, the package seems happily free of some of the more reckless spending items Democrats were hoping to include.

Unfortunately, the entire plan ultimately reflects one of the most enduring - and politically convenient - economic myths around: the notion that hard times can be softened by throwing money at them.

What's worse is that we have seen this many times before and it never works. In 2001 Bush pushed similar handouts, er...I mean rebates...and the economy stayed slow. It wasn't until the pro-growth tax cuts of 2003 that the economy started humming. But alas, pro-growth tax cuts don't poll so well in an age of instant gratification and economic ignorance.

The prospects for this monstrosity in Congress are sadly very good. John Boehner, whose leadership we have lauded much recently, made a bad decision to sign off on this thing already. I expect Republican leadership in the Senate to capitulate as well, although there are some rumblings that the Senate GOP's number two man, Jon Kyl, may make a fuss about this, which would be wonderful to see.

And the Democrats of course love this. All Nancy and Harry needed to know was one thing: Does this give free tax payer money to people who don't pay taxes? "Yes? Great sign us up, we love redistributing wealth! And we love it even more when we sucker Republicans in to joining us in our inexorable march toward French-style government."

Some people never learn...