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Delusional Government, Delusional Society

Are you tired of the bullshit surrounding the hysteria of the “fiscal cliff?” I am. America, by and large, is unwilling to grow up and face some hard facts.

First, where are we spending our Federal dollars:

In 2011, we spent 3.603 trillion. Almost 70% of that amount was spent on Pensions, Healthcare and Defense. If you add in the amount spent on “Welfare,” the number jumps to 82%.

The deficit for 2011 was 1.3 trillion (1.299.6 to be precise).

Spending is out of control and the biggest offenders are pensions, healthcare, defense and welfare. Defense and Welfare expenditures have increased the most over the last four years.

So, can we fix the problem simply by raising taxes?

No.

The best summary of the tax situation is at Business Insider.

They provide some pretty damning and informative charts.

Enough of the bullshit that, “the rich are not paying their fair share.”

We can keep taking money from the “rich,” but that won’t fix the spending problem.

And what happens if we go ahead and raise taxes on the rich? They will survive. But they will spend less money in the non-government part of the economy. That will dampen economic growth, not spur it.

Warren Buffett has been especially disingenuous touting the benefits of the wealthy paying more taxes. Daniel Shuchman in Forbes tears Buffett a new asshole using Buffet’s own words.

The so-called Oracle of Omaha begins by making the manifestly absurd assertion that tax rates do not influence investment behavior. Astonishingly, he claims that when he was a fund manager, “never did anyone mention taxes as a reason to forgo an investment opportunity….” “Only in Grover Norquist’s imagination,” Buffett derisively contends, do investors adjust their plans based on the prospects for taxation. Such statements defy economic logic. The amount and nature of taxation, whether of the income stream generated by a particular investment, or that levied on interim dividends or capital gains realized upon the disposition of an asset, must be among the many complex factors considered by any rational investor in assessing the relative merits of an investment opportunity. If this proposition is not self-evident to you, you can go straight to the authority himself.

Buffett has left extensive and contemporaneous documentation of his investment thinking going back five decades. And it is clear not only that he has always understood this fundamental economic axiom, but that tax considerations have been a critical animating factor throughout his business career. (Indeed, during the period when he was initially accumulating great wealth, Buffett was quite passionate about the desirability of low tax rates.) As early as 1963, he wrote a letter to the investors in his hedge fund, The Buffett Partnership, Ltd., in which he laid out some of the fundamental tenets of his investment philosophy as it relates to taxation. One was the following:

“I am an outspoken advocate of paying large amounts of income taxes – at low rates.”

What do we do? For starters, Republicans should propose cutting defense by 20%. All other Government programs should be held at 2008 levels. Federal Government employees should have their wages frozen. And Senior Executives (i.e., those who are Senior Executive Service and General Officers) should accept a 10% pay cut. That would be a start.

What do you think?

  • http://lesstalkmoreactivism.blogspot.com/ Canaan

    The only Republican I know calling for defense cuts is Pat Buchanan. PB opposed the Iraq War and opposes war with Iran. He’s a harsher critic of the Neocons than Michael Moore (and far more substantive).

    None of that matters to the ‘Lying Left’ because they don’t really care about peace. They drove a leading conservative who is anti-war and pro-defense cuts off BSNBC because PB’s idea of a “national conversation on race” is not a one-sided lecture where Eric Holder does all the talking.

    A prostitute with Stage 9 syphilis has more principles in her diseased cunt than the modern American left.

  • HELENK2

    http://www.breitbart.com/Big-Government/2012/12/03/Los-Angeles-POrt-Strike-Drags-On

    strikers at ports of LA and Long Beach

    these fools are costing California millions.
    ships going to mexico to unload

  • HELENK2

    http://news.cnet.com/8301-13578_3-57556704-38/cops-to-congress-we-need-logs-of-americans-text-messages/

    WTF

    want providers to store sms for two years ” just in case a crime is committed?”

    • DianaLC

      I guess the old fogeys like me can commit crimes now because we’ve just never decided to learn how to text message or tweet or get on Facebook–not that we want to learn those things.

  • HELENK2
  • HELENK2

    http://www.reuters.com/article/2012/12/03/us-usa-tax-irs-idUSBRE8B21HA20121203

    IRS releases 159 pages of new tax rules due to obamacare.

    Isn’t that just peachy

  • HELENK2
    • getfitnow

      That One is NEVER going to agree with anything the GOP puts forward. NEVER. He’s not even in this except to say NO to any offer that’s put on the table. Once again, he’s leading from a golf course. Soon he’ll try and lead from his $4 million taxpayer-funded vacation in Hawaii.

  • Hokma

    I am not going to go into a dissertation about branding but to be brief, once you have decided on what your brand character is, you have two choices: (1) to be proactive and focus almost exclusively on who you are, or (2) defend who you are against attacks from competitors.

    If you choose the latter you lose.

    I just read a piece by one the key advertising executives for the Romney campaign in what he considered to be what they did right:

    1. We reinvented political advertising.
    The entire ad and production team was in-house. Creatives, media, production, editorial, everything. Our ability to create quality work in a hurry was historic. We turned an Obama gaffe into a TV spot in 90 minutes.

    3. The Obama campaign pulled a ‘new Coke.’
    Before I was a political ad guy, I was a brand ad guy. I believe in the power of brand, especially in politics. That’s why I was amazed when the Obama campaign took a big, positive, thoughtful brand (Hope and Change) and tossed it overboard in favor of talking almost exclusively about fear and negativity.

    http://adage.com/article/campaign-trail/ad-making-romney-campaign-a-firsthand-account/238559/

    What this tells you is that Axelrod outwitted these guys. By Axelrod going negative on Romney even to the extent of outright slander, he drew in the Romney campaign into constantly defending the candidate against a barrage of attacks and then engaging in the same petty negative attacks as Obama did.

    So what was missing?

    The Romney brand which when rarely aired was muddled and weak.

    I am not saying that Romney could ignore the negative attacks, but following the major win in the first debate, his campaign should have been prepared with an all out assault of positive uplifting Romney brand commercials. But they never did that and squandered the opportunity Romney had created after the first debate.

    Below are three Reagan commercials from 1984 that should be the gold standard:

    http://www.youtube.com/watch?v=jzfF6E-tx7o

    http://www.youtube.com/watch?v=EU-IBF8nwSY

    http://www.youtube.com/watch?v=NpwdcmjBgNA

    This ad executive concludes how close the election was. The fact is that if had done his job effectively it would not have been a close election at all.

  • MG6
  • HELENK2

    http://freebeacon.com/flailing-fema/

    and here is FEMA failing again.

    many homeless due to Sandy

    empty fema trailers sitting in PA

  • HELENK2

    http://www.bbc.co.uk/news/business-20154358

    the downward mobility of education

  • Theymustbemorons

    Hope all is well at NQ. Tried several times over last two days to access and received a message that NQ was “unavailable.” Tried again and was finally able to get through. Have a good day everyone!

  • MG6

    http://www.barenakedislam.com/2012/12/01/maryland-catholic-school-to-be-replaced-with-the-largest-islamofascist-indoctrination-enter-in-america/

    Found this in one of the comments:
    Theodore Roosevelt’s ideas on Immigrants and being an AMERICAN in
    1907.
    “In the first place, we should insist that if the immigrant who comes
    here in good faith becomes an American and assimilates himself to us,
    he shall be treated on an exact equality with everyone else, for it
    is an outrage to discriminate against any such man because of creed,
    or birthplace, or origin. But this is predicated upon the person’s
    becoming in every facet an American, and nothing but an
    American…There can be no divided allegiance here. Any man who says
    he is an American, but something else also, isn’t an American at all.
    We have room for but one flag, the American flag… We have room for
    but one language here, and that is the English language… and we
    have room for but one sole loyalty and that is a loyalty to the
    American people.”

  • HELENK2

    http://blogs.the-american-interest.com/garfinkle/2012/11/30/small-calamities/

    small calamities in the ME
    what the UN vote will cause

  • Hokma

    I was reading how the GOP had an opportunity to politically corner Obama on this issue, but it is Obama who has cornered the GOP.

    This is somewhat similar to the confrontation a conservative House had with Bill Clinton who they did back into a corner and forced to be amenable to their direction.

    The difference between then and now is “leadership.” There is a huge difference between the leadership of John Boehner and Newt Gingrich. Boehner is a competent and well meaning civil servent. Newt was a fiery visionary who was able to go to-to-toe politically with Clinton.

    Right now the GOP, and the country, needs a leader to counter the demogoguery of Obama and the far left. I don’t see any Newts right now and it appears the GOP (and the country) are going to have to bend to Obama and the left and take one up the . . . .

  • Heather Stein

    Larry Johnson is completely lame. Why do you hide behind censorship? I thought you were a tough guy, but you are really an empty suit. Deleting comments that you do not like or push back against your BS is completely lame. Why do you run a public website with a public comment forum if you are going to censor all posts that you disagree with? Shows just how weak your arguments truly are. Typical conservative. Your groupthink and NQ bubble is a joke.

    • Heather Stein

      It is also funny that you conveniently leave out a number of important charts from the article you quote from Business Insider. You in fact leave out the most important charts.

      http://www.businessinsider.com/who-pays-taxes-2012-8?op=1

      The very first chart in the Business Insider article you quote shows how the top 50% capture all of the income growth since 1980.

      The third chart in the article you quote comes with the heading:

      “As a percent of the economy, though, federal tax revenue is actually well below average–only 17% of GDP”

      Suggesting that we have a huge tax revenue problem. We are not collecting anywhere near as much in taxes as we have over the last 72 years.

      If you read all the charts in the article that Larry Johnson quotes and not just the selective ones he wants you to read the most astonding conclusions are:

      1) the wealthy in this country have done amazing well, they have managed to capture most of and an increasing part of the income and wealth in this country. They can afford to pay more in taxes. They can afford to pay what they paid under Clinton.

      2) the bottom income part of social actually pay a higher proportion of their income in taxes versus what the wealthy pays.

      3) although spending has increased, primarily because of more spending because of the aging population, the real problem is tax revenue. It has fallen off a cliff and has not been this low as a percentage of GDP since the 1950s.

      It is clear. The poor are getting progressively less and the wealthy are getting progressively more. Welfare has nothing to do with the current fiscal situation.

      • HARP2

        Zzzzzzzzzz

        • HELENK2

          do you want to tell her Pravda is not interviewing today???

      • http://www.missmalevolent.com/ Miss Malevolent

        http://reason.com/archives/2012/12/01/if-you-dont-think-spending-is-at-the-roo

        Please educate yourself.

        Want Clinton era taxes? Have Clinton era spending. There’s the compromise.

        • Heather Stein

          Actually current spending is about 23% of GDP, which is only slighly above where it has been historically and during Clinton when it was closer to 21%. Given the retirement age population has grown exponentially since Clinton you cannot expect the government to spend the same level forever with an aging population. Spending has to go up in Social Security, Medicare and Medicaid. Nothing wrong with that, we just have to pay for it with a proper level of taxes. The same thing is happening in western industrialized countries all over the world. As the population ages the government has to spend more to support that aging population. That is where the bulk of new spending is occuring. Now where America is very different than all other countries is in our obscene level of military expenditure. Would you rather keep Granma out poverty with a social security check or build another aircraft carrier? It is all about priorities.

          • http://www.missmalevolent.com/ Miss Malevolent

            Clinton 20.6%, Obama 24.3%, You’re being glib on it being a minute difference. A difference of $1 Trillian damned dollars…and it’s only going up from there as Obamacare hasn’t been fully put into place. Some are saying at our current rate it could reach 36% in the next 25 years. How is that sustainable? Once again, when you have a current populace that is underemployed or unemployed?

            And I’m sick to death of logical fallacies.”Would you rather keep Granma out of poverty” BS that is nothing but “an appeal to pity”, dash of “red herring” with a pinch of “straw man” thrown in for spice.

            Here let me throw a little straw man back at you for good measure. We’re paying for Granma, her grandson, cousin Ray Ray, and aunt Pookie NOW..but who is going to be there to pay for us? What industries are we as a country fostering that will secure the future, not just for the kids, but for us as we mature? Like I said, your president is not an honest broker. If he were he’d say that he wants EVERYONE to pay more. Cause that’s what it’s going to take to get us through NOW.

            But as we all know, if they take more, they’ll spend more..and the vicious cycle continues, until we end up like Greece, Portugal, Spain and everyone else.

            Want Granma to keep getting her checks? Think up ways to drive up our industry to get more people to work to pay for her check. Instead of this ridiculous fantasy, that taxing the rich 4% will take care of our woes.

            • Heather Stein

              “A difference of $1 trillion damned dollars…”

              Your math makes no sense. Where do you get your $1 trillion?

              CBO says ACA bills will actually reduce the deficit.

              36%???? What are you talking about?

              You don’t get the point. If you are going to cut spending then it is all about priorities. Should we be cutting Social Security or military spending?

              Comparing the economy, the economic power, the taxing power and the debt level of the U.S to Greece, Portugal and Spain is a complete joke.

              According to the CBO if we just let all the Bush tax cuts expire the deficit as a percentage of GDP would fall to about 2.5-3.0% of GDP, which would be close to the very manageable 2.0% 60 year average.

              Your fear-mongering on the deficit and debt is just that. What exactly do you expect to happen? Financial markets are currently putting U.S. treasuries at historic low yields. There is no sign of any panic on the deficit and debt other than by political hacks like yourself and your Republican party.

              • http://www.missmalevolent.com/ Miss Malevolent

                If you’re going to get serious, then you cut AND tax.

                You and your party’s lies and demagoguery and says that going up 4% on the top earners will pay for these programs, no it won’t, and it will do ZERO for the deficit.

                “Adjusted for inflation, Clinton spent $2.24 trillion in 1993; that level stayed relatively stagnant, rising to $2.41 trillion in 2001. Now let’s look at Obama’s budgets starting this year: $3.8 trillion. By the time we hit 2022 under Obama’s plan, we’ll be spending $4.77 trillion. That means that Obama is spending twice what Clinton did.

                That’s why no Democrat will ever agree to go back to Clinton-era spending. If they did, they’d have to agree not to $1.2 trillion in spending cuts over 10 years, but to $1.4 trillion in spending cuts this year alone. That’s 37% of the federal budget.”

                You either have higher taxes and higher cuts. And nothing else.

                If you’re for cuts in defense, you should be for the restructuring Social Security, Medicare and Medicaid. This kick the can down the road shit with SS does not impress me. And Democrats have no leg to stand on with Social Security being so sacrosanct when they’ve been all to willing to break into the piggy bank to fund whatever bullshit they wanted at the moment. Now all the sudden, you’re care about Grandma? No you don’t. And you never did.

                And I’m not a Republican. I’m just not an automaton like you.

    • Heather Stein

      usgovermentspending.com is a complete crock. That is a far-right wing funded piece of crap. Why don’t you use a source of information that is slightly more objective like the CBO or OMB?

      Where do they come up with their definition of “welfare” and where do they come up with their “welfare” spending number? Their numbers are complete nonsense.

      Larry Johnson your comment is garbage in garbage out. Read how governmentspending.com comes up with their information here:

      http://usgovernmentspending.bl

      It is a joke.

      That website is run by Christopher Chantrill. He is a real right-wing nut. In fact, he is an extreme right-wing nut.

      Lets just look at some real numbers and a real definition of “welfare”.

      That moron Chantrill at usgovernmentspending.com seems to throw all kinds of spending into a generic category he calls “welfare”. He likely included Medicaid (mostly going to disabled and retired), CHIP, Pell grants, etc. and who knows what else in his ridiculous definition.

      Lets deal with reality.

      Welfare” traditionally (as in pretty much always) refers specifically to Temporary Assistance for Needy Families, or TANF, the federal program that was created in 1996 to replace the Aid to Families With Dependent Children program — also known as “welfare” — that had existed since the New Deal. This is what people refer to when they say “welfare caseloads” and “welfare rolls,”. The federal government spends $16.5 billion a year on TANF and, combined, the states spend another $10 billion. That is a lot lower than your bullshit usgovernmentspneding.com claims. Traditionally “welfare” spending is about 1% of Federal spending.

      As for your comment:

      “They provide some pretty damning charts.”

      Yes, lets look at those charts you Larry Johnson provide. They are pretty damning. The first one shows spending in whole numbers pretty much growing at the same trajectory it has been growing at for years. Government spending is sure to grow given the aging population and the corresponding growth in social security (which is paid for) and medicare (representing healthcare inflation). Also, military/security spending has gone through the roof. However, what is more important in your first chart is the blue revenue line. Notice anything. It has fallen dramatically over the last few years. It has no longer kept pace with spending. In fact, tax revenue as a percentage of GDP is below 15% or well below its 60 year average of about 19%. Your first chart shows it is entirely a TAX REVENUE PROBLEM.

      Given the aging population it is unrealistic to believe that total government spending will remain the same, given the high proportion of medicare and social securitity spending in the budget. We have a growing retired population so government spending is going to have to grow. Nothing wrong with that.

      Your next two charts show share of income paid by income group. Yes, given that the top 1% have captured most of the income gains in the last 30 years it makes sense they will pay proportionally more total taxes. It is simply because they are making all the money in the country. If you look at their effective tax RATES. like Romney’s 13% rate, it has plummeted. So relatively to their income and wealth the top are paying far less taxes than they use to at any time in the past.

      “And what happens if we go ahead and raise taxes on the rich? They will survive. But they will spend less money in the non-government part of the economy. That will dampen economic growth, not spur it.”

      There is absolutely no proof of that statement. In fact, most academic studies say that the spending of the wealthy is the least effective way to spur the economy. You can only buy so many yachts and houses. Any incremental money the wealthy have just goes into investment accounts and is not spent in the economy to spur growth.

      The simple reality is during the Clinton and Reagan eras the economy grew quite good and taxes for everyone, not only the wealthy, were higher. In the 1950s we had +70% tax rates on the wealthy and the economy grew rapidly for a generation.

      ” All other Government programs should be held at 2008 levels.”

      That is garbage. There is no way the U.S. government can keep spending at 2008 levels with a huge aging population. How about we just pay some more taxes?

      Total U.S. government spending, including state spending, is about 35% of GDP. Even after adjusting for different healthcare systems, that is very very low compared to the OECD average of closer to 45-50% government spending to GDP. The U.S. already has one of the smallest governments for a major industrialized nation on the planet. You want to shrink it even further with all these baby boomers retiring. Yeah right!

      Keep living in your bubble of quack far-right wing theories and “facts”. Keep defending the very low tax rates the wealthy and guys like Romney have. That will do your side good at the polls.

  • HELENK2

    http://www.reagancoalition.com/articles/2012/20121203008-egyptian-silence.html

    as morsi ( backtrack”s BFF) new constitution reinstates slavery, there is a great sound of silence from the msm and the backtrack bunch

    • Hokma

      But the Muslim religion is a religion of “peace” except for rape and sodomy, or stoning, or beheading, or slavery, or suicide bombing, or targeting innocent civilians, or using innocent civilians as shields. And let;s not forget how they are SO tolerant of other people and religions.

  • HARP2

    Obama Gets Humiliated in the Pacific

    President Barack Obama attended the summit to sell a US-based Trans-Pacific Partnership excluding China. He didn’t. The American led-partnership became a party to which no-one came.

    Instead, the Association of Southeast Asian Nations, plus China, India, Japan, South Korea, Australia and New Zealand, will form a club and leave out the United States.

    Read more: http://nation.foxnews.com/president-obama/2012/12/03/obama-gets-humiliated-pacific#ixzz2E0qV2N8s

  • MrLynn

    Current defense spending as a percentage of the federal budget is at an historic low (c. 23%):

    http://treeofmamre.wordpress.com/2011/11/21/defense-spending-as-a-percentage-of-the-federal-budget-a-historical-perspective/

    That’s not where we should be cutting.

    /Mr Lynn

    • Heather Stein

      That is complete BS. The average defense spending per GDP is artificially inflated in the charts you show because of WWI, WWII, the Vietnam war, cold war etc. There is no way this country, particularly during peace time, should be spending historically the same as a proportion as the economy as it has in the past. Also, maybe America was just spending too much on military spending in the past, particularly when the threats are now significantly reduced. You do not need armies of tanks and endless nuclear missles today.

      • MrLynn

        Since when is this ‘peacetime’?

        Not only are we fighting a long war against the Islamists in many places, we are responsible for maintaining the freedom of the seas for the Western World. China is moving to challenge us in the western Pacific in coming years (just launched their first aircraft carrier), Russia is busily reviving its old Soviet aims, and Iran is on the verge of triggering a general Mideast war.

        Cut out the departments of Education, Energy, Homeland Security, and the EPA–not Defense.

        /Mr Lynn