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  • Morning Bell: It's the Spending

    On Friday evening, Standard & Poor’s (S&P) downgraded the U.S. credit rating from AAA to AA+. As we and other conservatives warned, the spending reductions in the deal negotiated by President Obama to raise the debt ceiling were inadequate, and S&P reacted as we predicted but sooner. Neither Moody’s nor Fitch, two other rating agencies, have downgraded federal debt yet, but they are not providing much rosier outlooks.

    Decades of over-spending and over-borrowing by the federal government have damaged America’s creditworthiness. Congress after Congress, President after President, the federal government spent every penny it took in—and borrowed over $14 trillion on top of that—to try to keep happy the voters to whom the government made promises it could not afford. The government kept shifting the burden of paying the bills forward onto future generations.

    Well, the future has arrived, and it is bleak. Our economy is weak, millions of Americans are out of work, and America is so deep in debt that we have lost our good credit rating. Our nation needs to drive federal spending, including our ever-growing entitlement programs, down toward a balanced budget while maintaining our ability to protect America and without raising taxes. That is the sound path forward to a stronger economy with smaller government and more real jobs.

    The White House’s first reaction to this news was to blame S&P itself, claiming that their math was wrong as spokesmen pointed out S&P’s past rating failures. Correcting the math didn’t correct the problem, however, and so S&P went ahead with its downgrade. Debating S&P’s credibility misses the more important point, which is there for all to see: Projected deficit spending properly raises questions about U.S. credit quality.

    We cannot waste time shooting the messenger when the message itself is impossible to ignore: It’s the spending.

    Unsustainable entitlement programs have been built up over many Congresses and Presidents. Elected officials from both parties over many decades helped push us closer to this point. But the last chance to start correcting the problem before damage to America’s credit occurred was during the recent debate over the debt limit.

    Regrettably, President Obama and the Senate liberals refused to allow reforms to any entitlement programs and refused to make significant cuts in other federal spending unless they could raise taxes on America. Conservatives rightly resisted increasing taxes, which is a recipe for economic disaster during an economic slowdown. The resulting deal on the Budget Control Act brought little in the way of spending cuts and lots in the way of increased borrowing, and it was the last straw that cost America its top credit rating. President Obama and his liberal allies on Capitol Hill brought America’s credit down

    The White House claims that its tax-hike centered “grand bargain” would have prevented a downgrade, yet they still have not told us what was in that “bargain.” Even as Senate Democrats are nearing three years without a budget, President Obama has offered to the American people rhetoric and class warfare, rather than solutions and responsible leadership.

    Other liberals went out of their way this weekend to blame this downgrade on the Tea Party, with Senator John Kerry (D–MA) going as far as calling it the “Tea Party downgrade“ on NBC’s Meet the Press. Former Obama advisor David Axelrod echoed that coordinated spin on Face the Nation. Besides proclaiming for all to see that the liberals have no solutions themselves, this argument ignores the facts.

    The Tea Party’s primary focus is our nation’s fiscal health. If it were not for the Tea Party’s positive influence, Congress would still be spending, taxing, and borrowing with little regard for the burden it is placing on future generations. Only months ago, President Obama was demanding a so-called “clean” debt limit increase that would allow him to keep on borrowing without any cuts to spending.

    As our colleague J. D. Foster points out in his expert analysis of Friday’s downgrade, the debate over the debt limit was the substantive ideas of the conservatives versus empty political rhetoric of liberals:

    In the course of negotiations on the debt ceiling, congressional Republicans tried tirelessly to get the President and Senate Democrats to get serious about cutting spending. All Obama and Senate Majority Leader Harry Reid (D–NV) could do was carp about symbolic tax hikes on the rich, oil companies, and their latest silly affection—corporate jets. To be clear, despite the perilous state of the nation’s finances, the President’s sole objective was ideological and symbolic: Even if Republicans had caved on tax hikes, which they wisely refused to do, the revenue gains would have been inconsequential compared to the spending cuts that are necessary. The President played politics while the nation’s credit rating was set to burn, and now it has.

    President Obama, congressional liberals, and their allies believe that if we remain silent on our fiscal future, then markets and credit agencies will not notice our perilous future. Thus we heard from liberal pundits and politicians who called the debt debate a “manufactured crisis”—as if everything would be fine with more blank checks. The problem of federal over-borrowing and over-spending was and is real, as the credit downgrade and market reactions reflect. Congress and the President must fix the problem and fix it now.

    Liberals this week will try to equate revenue increases with tax hikes. But that is simply not factual. Government revenues increase when we have greater economic growth and more taxpayers in the workforce. That economic growth is impossible with job-killing tax hikes and increased regulation. Raising taxes on taxpayers earning $250,000 or more hits entrepreneurs, small business owners, and investors, thus slowing economic growth still further.

    In the next 10 years, once the economy recovers, revenue will rapidly approach and will likely surpass its historical average of 18.5 percent of GDP, while spending is projected to shoot past its historical average of 20.3 percent to 26.4 percent of GDP. Government spending will have increased by 22 percent just on President Obama’s watch.

    Yet some liberals were still calling for more debt and deficits this weekend in the name of new “stimulus.” On Friday evening, Obama’s former economic advisor Christina Romer said the first failed stimulus she helped design should have been bigger and argued for a new and larger stimulus saying: “What I want is more now.”

    That is, more of what President Obama has given us in the past—fruitless new spending programs. This would give us a bigger problem, not a solution. With America and the world in the grips of an economic slowdown, we need action to create economic growth and jobs and restore America’s credit. We do not need more government.

    As dire is the domestic situation, as Foster notes, the consequences for the global financial crisis may be worse:

    In today’s global economy, however, the U.S. credit rating downgrade may prove catastrophic. Prior to the credit rating downgrade, Europe was already teetering on the brink. Last week European stock exchanges plunged 10 percent, their worst weekly losses since November 2008. The long-building government debt crisis in Europe, which had been so unsuccessfully papered over just a few weeks ago by its leaders, is reaching the boiling point, threatening to wash over not just the worst offenders like Greece and Portugal but also some of the pillars of the European Union like Spain and Italy.

    We cannot improve domestic or global economic conditions by becoming more like Europe. America can do better by adopting better ideas.

    Heritage has offered its fiscal plan, “Saving the American Dream,” which would balance the budget in 10 years and lower our debt-to-GDP ratio to 30 percent (from the 100 percent it reached last week). It would accomplish this through responsible reform of Social Security, Medicare, Medicaid, and the tax code.

    As Foster concludes:

    A number of sound incremental reforms can garner strong bipartisan support and can substantially improve these program’s sustainability and the nation’s finances. The President must lead his party to join hands with Republicans in the joint select committee to embrace these reforms and be ready to enact them, saving far more than $1.2 trillion and far sooner than November 23. The objective for the nation, the President, and the joint select committee is clear: drive down spending—including and especially on entitlement programs—toward a balanced budget while protecting America and without raising taxes. Properly done, this would lead to economic growth, more jobs, less government, and a restoration of the nation’s credit rating. It can be done.

    It can be done.

    Quick Hits:

    • The world is watching Wall Street this morning as investors wait to see the impact of Standard and Poor’s decision to downgrade the U.S. credit rating. Stock futures tumbled early Monday, while gold soared.
    • The bodies of the 30 U.S. Navy Seals who were killed in Afghanistan over the weekend will be flown home to American soil on Tuesday morning. An investigation of the incident is ongoing.
    • Treasury Secretary Timothy Geithner will remain in his position through the 2012 election, following months of speculation that he would step down.
    • About 45,000 Verizon union employees have gone on strike following contract disputes over health care, sick days, holidays, pensions, and the company’s ability to lay off workers. Meanwhile, U.S. unemployment stands at 9.1. percent.
    • Internet censorship is ratcheting up in Iran. By the end of August, Iranians going online will only be able to talk to each other under the country’s cyber censors.


    Posted in Economics [slideshow_deploy]

    67 Responses to Morning Bell: It's the Spending

    1. Turner says:

      The crooks in Washington blame the Tea Party: HOW BAD WOULD IT HAVE BEEN IF THEY WEREN'T THERE TO MAKE THEM NOT SPEND! They would have rubber stamped the increase. Those arguments show the ignorance of these profligate psychopaths we call leaders.

      • Brian Paonessa says:

        The current situation our country finds itself in is bad. To summarize in terms the average individual can understand:

        Spouse #1 works two jobs and 65 hours per week to bring in $100,000 annually. Spouse #2 does not work but combined they spend $150,000 annually. Spouse #1 (a Republican) says to Spouse #2 that a resolution to the crisis is to cut spending. Spouse #2 (a Democrat) informs Spouse #1 to get a third job.

        A tough situation to compromise? Not really. Cut up the credit cards.

    2. Mike Thomas says:

      I can't believe this constant desire by many to take away from social security and medicare. Promises were made to those retired and who will retire in the future. Our government frequently robbed from social security funds creating the nightmare we have therein. And if our leaders are as smart as they project themselves to be, past and present, the millions of baby boomers that they knew would be joining the ranks of retired men and women, could have been prepared for. Why is it that our great country only react after a crisis is upon us. This is not governing!

      • Kajin says:

        There do need to be cuts to ss and medicare….the people who have not paid in! There are many, many, many people drawing from both that never paid in at all and many more drawing without having paid a fair share!

        • mike says:

          One cannot collect SSI or Medi-care if one has not worked the necessary quarters. Some collect more than paid in, if they live long enough; others die at 64 and get $600 death benefit. It is insurance, and like all insurance some get more than they pay and vice-versa.

      • Gene says:

        My sentiments exactly.

      • Frank says:

        The problem is:
        1) When the voters became aware that the government was spending the money that was supposed to be set aside for these programs, the voters continued to re-elect these jerks who kept spending the money. So the voters cut their own throats!
        2) These programs were Unconstitutional in the first place… a gross Federal over-reach

        The solution is:
        1) Keep the program as is for those retired or near retiring.
        2) Privatize, phase out or send these programs back to the States if the voters insist on them. They don't belong Constitutionally to federal jurisdiction.
        3) Refund all monies to those who paid in & won't benefit from these Federal programs.

    3. Rick says:

      Along with what has been offered to helping this situation is term limits. I find it hard to believe the fools who put us here will have the smarts to get us out. The corrupt ways won't change. Obamareid and polosi being ther biggest offenders along with schummer are thr reason this country has failed. The next being unions. We e all saw what washington was worried about it wasn't the debt or cutting but re election. The unions continue to kill this country. This picture we see will only become clearer as washingtons greed will never change until we rid these thieves out of office

      • Bill says:

        Term Limits were passed in the 90s, I believe, but the Supreme Court said it was unconstitutional so the only way to get them now is by Constitutional amendment. I am all for such an amendment but then again, I am a tea partier so I suppose i am responsible Obama's downgrade (sarcasm does not transfer well here). Obama said it would be harder to rule against the people in an election year. How can we make it harder to do ALL the time?

      • Frank says:

        Rather than term limits, we should just make sure no Bankers, Unions or Big Businesses donate to politicians re-election campaigns. Only private citizens who are voters. Then list all donations on the internet so people can see who donated & check if later big donors get big political favors. Then publish the facts prior to the next election!

    4. Aqualung says:

      You have most of this right…..however please stop taking taxes off the table. When you have 400 people controlling more welath than 150 million peopledo this needs to be considered as a government resource. Speak about entitlements, who has more entitlement than those 400 people. If these people are so successful, why aren't they being consulted and called upon to contribute a solution to our nations problems. The same nation that allows them to enjoy all that wealth. How many jobs have they created. What are their programs ot put America back to work…Do they care????

      • Paul L. Thompson says:

        Taxing the rich will not stop Government spending. Aqualung, if the Government took every dime made by the top twenty thousand earners for a full year, it would only fund the Government for 18 days. Take every dime from the top 240,00 and it will fund the Government for 28 days. IT IS NOT THE TAXES, IT IS THE SPENDING!

      • pcj2535 says:

        A government resource?? Really? So, what a person earns is not theirs to spend or not spend as they see fit? Sounds like you have bought into the wealth redistribution rhetoric. I don't trust the government with my tax dollars and neither should you. As soon as Obama is voted out of office you will see the unleashing of entreprenurial energy that has been building up over these last three years. You will see hundreds of thousands going back to work and back on their own two feet again.

      • Gary1206 says:

        So Aqualung, what happens when you confiscate ALL the wealthy people's money? Let's say that's $250B; sounds like a lot but is it? What does that do? Why don't they come after your money and let's see if you're so eager then.

        Please be honest and tell us what it is about confiscating wealth that so intrigues you people?

      • Bill says:

        I don't know where to begin to fix that kind of thinking.

      • Maria H says:

        Entitlement denotes an individual should be given something without earning it. The '400' as you put it, are not entitled to something they did not earn. They in fact earned it. When you earn it, it is yours to do with as you see fit. Those same people have offered their expertise to the Government and offered solutions to our nations problems. The Government turned them down. Only the wealthy can and do create jobs. It is false to say that the government creates jobs. The government can give incentives to wealthy people to create jobs – this my friend creates true long term growth in the economy. What incentive does a poor man have if everything is handed to him on a silver platter? FYI – I earn less than $60K/yr and my incentive to work hard and earn more (to pay more taxes) gets sucked down the drain every time I hear that the rich ($150K/yr) need to pay a higher % in taxes.

        • mike says:

          Entitlement is actually something one is entitled to BECAUSE they paid into it. SSI and Medi-care are the biggest welfare is a social program not an entitlement. The rest of your argument is correct

      • ThomNJ says:

        "When you have 400 people controlling more welath than 150 million peopledo this needs to be considered as a government resource."

        Why don't you just come out and say you are a communist? Since when is it YOUR RGHT to say take from the prosperous? Just because they have more? Just where do you draw the line….this week? As I recall there is a Commandment for coveting a neighbor's goods. Your argument is so vacuous and ill-conceived that it is not worth further addressing.

      • Yeah I'm going to have to agree with Paul Thompson on this one. It isn't that we don't tax the wealthy enough. Also look at it from the perspective of the wealthy- why should they take on more of the tax burden because the government can't handle their finances correctly? Is that not punishing the wealthy for being wealthy?
        As far as the cuts to medicare and medicaid…what about the cuts Obama's administration made to these programs so they could get Obamacare started? It's the same thing…Obama and the liberals stole from those same people that you said were promised those entitlements for when they retired. What's worse is those cuts to both programs will stick.
        Here's the problem with Washington and our elected officials- They have all of these great ideas but don't have the funds for over half of them. So their answer isn't what is ECONOMICALLY best for this nation but instead to immediately raise taxes. Their mentality in simplistic terms is this- "Oh we don't have any spare cash to fund this program? That's fine we'll just up the fee to be an American citizen."
        I have a HUGE problem with starting a new health care system, universal health care at that, during 1) bad economic climate, 2) when the majority of the country said to leave their health care alone, and 3) having politicians, i.e. the former speaker of the house, making remarks such as "if it means losing seats in the mid-term elections to getting this passed then so be it." Now wait a minute is that not admitting that enough people aren't in support of the health care overhaul? If you knew you were going to lose, and they lost pretty badly in those elections, but STILL push the bill through both chambers of congress simply because you can isn't acting in the best interest of your constituents. That is and always will be acting on your own behalf based on what YOU deem best and not what the people who elected you are saying to do. Keep in mind, it is after all us lowly tax payers who pay these politicians and the president. They literally are our employees and we the citizens are the employers! Without our tax dollars they couldn't fund ANYTHING.

    5. Blair Franconia, NH says:

      If defense cuts have to be made, (and they will be), then Congress should cut funding for the M16. The M16 uses direct impingement. Newer assault rifles, like the G36, use a piston, to impinge the gases into the barrel and fire the bullets.

    6. vicki says:

      Heritage – have you presented your plan to the government?

    7. Mike says:

      The democrats tried to blame the Tea Party, but if Congress would have implemented the cuts that many Republicans suggested, we wouldn't have been downgraded.

    8. Dale says:

      It is my opinion that there needs to be a 'house cleaning'!! On BOTH sides of the aisle!! I have never seen such idiocy in government as there has been these last several years and, I unhappily have to include the last years of the Bush administration as well. There should have NEVER been ANY bailouts! Period!! NOTHING out there was "too big to fail"!! So now we …or rather I should really say…our kids and grandkids are going to pay a price the likes that OUR grandparents would NEVER have imagined happening! I fear the days and years ahead will show us, or them..the grandkids.. a depression that will make their great grandparents Great Depression look like a fairy tale in comparison! I can only hope…AND PRAY (thank you Governor Perry) that we will truly see the error of our ways in this country and bring back some common sense to the government and to our thinking as well.

    9. Joe says:

      Aren't we just sick and tired of lines being drwan in the sand by both political parties.

      Would social security be an entitlement if the social security funds were not placed in the general funds?

      I also agree with the tax increases on the top 400 families that controll America. The goverenment is setup like this, the middle class are used like slaves to support a government whos funds find there way to the wealthy. The middle class is also used to protect the wealthy from the poor distroying the wealthy. There are no kings and queens in America. Its power must be returned to the People.

      Warren Buffet once quoted that his secretary pays more taxes than he does. Is there something wrong here?

      The best answer is a flat tax.

    10. cathy says:

      people on posts say it's not the spending, it's that the rich aren't paying their fair share. it is the deficit spending and the fact that both parties in congress choose power over raising revenue via the tax code. we need The Fed to stop printing and diluting our dollar and stop manipulating interest rates, gold prices and stock prices and we need everyone to pay a minimal federal tax with no loopholes, no deductions, no filing and no social engineering by congress. how do we do that?

    11. Robert, TX says:

      First, do not use the DOW as an indicator. Use the S&P 500 to see how bad it is. From Aug. 1998 to today, there has been ZERO growth in the S&P 500 – if you adjust the numbers to 2005 dollars, then we have lost ten percent of its value in 13 years. And the S&P 500 is a lot closer to Main Street than the DOW. Total federal spending is not the biggest issue we face. Its the WAY they spend the money. Since defense is the #1 topic of the Constitution, I figure we are borrowing $ 1.7 trillion to pay for one trillion in welfare benefits, and the rest for unemployment benefits; waste, fraud and abuse, and the $300 billion identified by Heritage as waste and duplication – all on borrowed money. If they actually spent $ 28 billion on new road construction and bridge repairs we would create 1,000,000 new jobs – so where did the money go?
      Oh, and the booming Texas economy? Housing prices in Fort Worth went down 6% and our property taxes went UP. Thank you Rick Perry.

    12. toledofan says:

      Great article, but, I trhink there is another reason for the debt downgrade; the fact that the deal wasn't serious and the Administration, including the Democrats, can't be trusted to do what they said or to do what has to be done to fix the mess we're in. It's obvious, from the bklame game, that Obama really doesn't that this seriously and we're going to just trudge along doing more of the same. That's evidenced by Obama's remarks on Saturday to increase the amount in unemployment benefits; it's easier to just hand out more money and not fix the problem. Keeping Geithner on is a mistake, he has lost all credibility with the bankers and has no new ideas other than more of the same.

      • Bill says:

        I would say that the Republicans are at as much (possible MORE) fault than the Dems. We expects the Dems to act like they do. We had an election in 2010 and the Dems seem to KNOW its potential and are trying hard to compromise that potential. They were allowed to do so in both the budget debate and the debt ceiling WITH REPUBLICAN ACCOMPLICES. I find myself becoming anti incumbant.

    13. Paul L. Thompson says:

      All Governments need to be down-sixed 5% a year for ten years. City, County, State and Federal. STOP all tax funded anti-America organizations. (ie) Board of Education, EPA, Energy Department, La Raza, ACLU, NRP, Planned Parenthood. There are dozens more, just pick um out and stop giving them tax payer money!

    14. Jim Buzzell says:

      Don't hold your breathe until its done, there are no teeth in this legislation!

    15. The Farmer says:

      YES Rick!!! But not term limits!!!! Term Limit.

      One term, no re-elections for any of them!!!!

      The re-election process is what is the under-lying reason they get so corrupt!!!!

      ONE SIX YEAR TERM replacing 1/3 of them every two years.

    16. yellow jacket says:

      The increases during the Obama watch are a result of the Bush administrations policies and blackmail by Wall Street.Social security is NOT an entitlement program.The Bush tax cuts on the wealthiest Americans need to be suspendedWe all pay rent to live in this country[IRS]…and those who have benefitted the most should pay more rent.The middle class has been hammered enough,unless you want masters and serfs.

      • Bill says:

        So two people living in the same space and using the same resources in an apartment building should be charged rent according to their business success? Why do you even read this site?

    17. RonB says:

      You include the President in your statment that the objective was to drive down spending: it clearly is NOT the objective of this President – it never will be but most certainly should!!!

    18. Jeanne Stotler says:

      Everyone seems to forget that Social Security was not only paid by us but also by employers, this was suppose to be gathering interest in Treasury bonds, so for those who claim they got more than they paid in, You were suppose to, if this money had been invested in private ind. you could get twice what you are getting and not touch the principle. The US Gov't. has STOLEN from all of us, it was a HUGE PONZI scheme, yet no one is going to jail.

    19. James McMIllin says:

      The "substantive ideas of the conservatives " from the last 30 years and more specifically, the last decade are WHAT BROUGHT US TO THIS BRINKMANSHIP. Both parties are at fault because the refuse to even consider the outrageous spending and tax incentives of the military and our increasing dependence on the military industrial complex of jobs in this country.

      We are no longer producing the creativity and originality of invention our small industries did in the first half of the 20th Century. Instead, we are putting HALF our federal income into supporting over 700 miltary bases around the world IN ADDITION TO illegal wars and invasions in Afghanistan, Irag, Yemen, Syria and only the CIA knows where else because NO ONE HAS THE BALLS TO REIGN IN THE MILITARY.

      As Senator Grayson aptly pointed out in his bill Sen.5343 last year, the tax dollars we are spending on the illegal invasions and wars in Afghanistan and Iraq are ABOVE AND BEYOND the already soaring Pentagon budget. With the money for those wars alone, we could give EVERY U.S. CITIZEN a tax exemption on income up to $35,000, ( and couples up to $70,000 ). With this TAX EXEMPTION, we could still reduce the Federal budget.

      You want to know how to create jobs and balance the budget ??? Look to the 90's my friend. You want to know how to bust the budget ??? Look at the Cheney/Bush disaster that continues to waste 96% of us.

    20. Don says:

      It is the spending and the Heritage plan is a good one. But almost everyone continues to neglect the best source of savings, the bloated federal government workforce and inflated salaries. Starving the agencies would not only save money but would reduce regulation and increase production in the private sector. Why doesn't anyone address this problem?

    21. Nroma Link says:

      All the money from all the super 'rich' people in this country will not erase our debt.

      I am 75 and on Medicare. I never liked it as I felt my freedom had been taken away to make my own healthcare choices. I wish we could adopt Paul Ryan's plan for Medicare, but it won't include me as seniors already on Medicare will stay on Medicare. I see the liberals making more cuts in Medicare and our medical care will be much worse than it already is. However, they want to control us and cannot do away with that power over us. I would like all seniors to wake up and see what they are intending for us and it is not good. Ryan's plan will help my children.

    22. Dusty says:

      It may be too late, but bring back Paul Ryan's Budget Plan! To heck with the special-committee. That's going to be more of the same darn thing in one way or another.

    23. Ron says:

      We never hear anything about cutting our giveaways to foreign governments that don't like us. All we hear about is taking away from America to pay their insatiable appetite for spending. Social Security surplusses have been raided for years and now Social Security recipients are the culprits, never mind that we paid in for years. Before cutting Social Security and Medicare, which by the way were forced on us, cut off all foreign giveaways. Now the party in power that has for years told us the other party wants to take away Social Security, wants to take it away. Both parties are to blame. For decades they have put themselves and foreign cohorts ahead of America.

    24. Bobbie says:

      what's the point of having a government that holds no accountability and takes no responsibility? America deserves the opposite! strong and honest leadership that isn't easily swayed to blame a tea party for their failure to uphold America's credit rating. as rush pointed out, "obama inherited triple A credit" and wasted it to this! the tea party isn't in control of the spending!! there is no excuse! every man that became president was inexperienced!

    25. Frank says:

      Yes we can save America by using good ideas like:

      "Heritage has offered its fiscal plan, “Saving the American Dream,” which would balance the budget in 10 years and lower our debt-to-GDP ratio to 30 percent (from the 100 percent it reached last week). It would accomplish this through responsible reform of Social Security, Medicare, Medicaid, and the tax code."

      But it's not for lack of good ideas that America (& the world) finds itself in this dire fiscal mess… it's the resistance of the Power Elite to go along with these good ideas. They control the politicians (by "buying" their perpetual re-elections) & the voters (by monopolizing the lame-stream media to give only one "spin" on the news to dumbed-down voters). In fact, the Power Elite WANT a fiscal crises in order to give political cover to even more fiscal serfdom by ushering in a One World Order & One World Currency (to accomplish that, the Constitution & US sovereignty must be destroyed along with the US Dollar, the world's reserve currency). The Power Elite are well down the path to accomplishing their goal. The cowardly traitors in Washington, are granting them all their desires at the expense of "We the People" & our once great Constitution.

    26. carol,az says:

      Excesses spending = debt = insolvency. But the Dem still don't believe it.
      The blame game continues and once again it's the, "Tea Party's fault."
      No one will come out and say with full force from any mainstream media;

      We have NO leadership on any level from the Executive branch of Govt.

      This is the biggest coup d' esta in Americana's short history and the most destructive dysfunctional elected leadership also in the history of America.
      We have all just witnessed the complete breakdown of our Democracy based on : Greed, ignorance, insolvency, indecision, special interests, and the for the three years the chaos on so many other level has worked very well leading up to this point.
      Impeach now.

    27. Mary......WI says:

      Everything that has happened in this country the past 2.5 years just leaves me so dumbfounded. I thought Americans were understanding what the most unqualified president this country has ever had, Obama, and his ilk, were doing to this country but now I'm not so sure…..especially after watching the Sunday morning political shows yesterday.

      Clearly, "Conservative" is a very dirty word in this country. Socialism, Communism, Facisim seem to be the norm as so many ill informed Americans seem to accept or don't care, what is happening to their country welcoming "the transformation" with open arms….just so long as they get "theirs" from the government. I'm just about ready to throw up my hands. STUPIDITY IS NOT A VIRTUE!

    28. Lloyd Scallan says:

      Finally, some in the media have found the guts to wonder out loud if Obama is deliberately causing our financial problem. To many of us, this has been apparent from Obama's first few weeks in office. Today how can anyone, other than the truly committed leftist , doubt Obama's true intentions. But instead of addressing the problems, Obama and his minions in the Democrat Party, go into the same attack mode that has become their trademark. Attack S&P, attack Bush, attack the Tea Party, attack anyone that dares to have an opionon other than theirs. How much longer America, are we going to allow this to continue? How much longer before American stop defending "America's first black president" and admit his election was one of the biggest mistakes ever made?

    29. Ron W. Smith says:

      You've heard it from me before. Everything–and I mean EVERYTHING–should be on the table for cutting, then the cutting done equitably. (It wouldn't hurt to have all discussions and debates open to the public via radio, television and/or internet, a kind of control on the matter of equitability and insurance against politics-driven head-hunting.)

      Honest assessment of incoming monies to programs (FICA taxes, Medicare premiums) versus current outgo should be a part of this process. Long-term planning should be out of the mix since agenda-driven insistence on it has already been a culprit in the stalemates. Solve the now problems, fix the long-term in totally separate sessions once current rounds of cuts are complete.

      Honest assessment of the costs of our projection of power everywhere in the world–in dollars, in lives–should be seriously addressed. A country $14.5 trillion in debt and running annual deficits of over $1.5 trillion while borrowing about 40 cents of every dollar spent (approximately $4 billion a day) needs good, wide-open discussion and debate of the foreign policy decisions behind our spending more than the rest of the world combined on National Security. $1 trillion and more every year goes into it as though of no consequence domestically. The national debt can easily be seen as being, all these years, more the consequence of keeping 700+ military installations going internationally than the costs of entitlements. Both Medicare and Social Security have had and continue to have at least some money coming in, remember, not just money going out.
      Yes, Rory Cooper, "decades of over-spending and over-borrowing" are behind our fiscal woes. Total honesty in working for equitable solutions, discussions and debates open for all to see and hear, would be the start of healing a partisan divide that so far has succeeded only in widening the divide. Those who hide behind closed doors for their partisan plotting and name-calling shenanigans will have a very difficult time, true, but Americans everywhere will be the benefactors.

    30. Vinton says:

      When will get it? This is being done on purpose to destroy the economy and our national security. We should never expect The President to join hands to find a solution or embrace reforms that will save our economy. His ideology will not allow him to do what is right for the USA. Will the joint select committee find a solution? No, they will just spread the blame. That means "We the People" must continue to pressure congress to change its ways. This who charade makes it very clear that term limits are long overdue. It is time to speak up, stand up and to become very informed on issues and encourage others to become active in this political process.

    31. Vinton says:

      We must do a better job in the arena of ideas by presenting clearly what is wrong and how it must be fixed. The beginning to change the economy is "Saving the American Dream." But, we must take this presentation to the American People and spread it all over every media source possible. "We the People" must make it our goal to talk to everyone possible about real solutions that are available. It is time to stand up, speak up and knowledge up! We can do it and must do it to save our Country, our State, our County and our City. It's your choice, make up your mind what you will do to save your Country.

    32. L.C. Dunn says:

      Flat 15% tax with no deductionss will solve this problem, and taxes will be more based on your income. This is the only way to prevent loopholes and deal making.

    33. Emma says:

      When Clinton left office there was a surplus. An example of spending less than taken in.

      • DumbyaBush says:

        No, Clinton raised taxes on those who could most afford it. Emma is going to need SS and Medicare. Why on earth would she suggest to the readers she has the ability to live without it? Emma, you are poor. Admit it. If there is less spending, you would see fewer benefits – just when you need them the most.

    34. Stirling says:

      Thank you S&P. You have provided a reality check to this administration that spending beyond your means, and the entitlement nation must come to an end. Economics 101 has consequences. If moody's and Fitch have any scruples they will follow suit. This administration now owns the first downgrade in our nations history.. put that on your presidental adds for 2012..

      • DumbyaBush says:

        The folks here who are cheering on the financial destruction of the nation probably all believe they are good Christians too (wrong, you are fake Christians). The 'entitlement nation' the nitwit above speaks about brought the world the largest middle class ever. It brought schools, technology advancements, jobs, etc…but that is not enough for these folks. These folks want everyone to suffer along with themselves. The bad decisions (marrying too early, pumping out too many babies, not finishing school, etc…) all contribute to their destitute situation. Stirling has no money, no assets. His overarching need to identify with the wealthy just serve to illustrate the alternate reality he lives in.

        • Frank says:

          The fact is, the USA has been spending above its means for quite some time now & hiding the reality of the situation by borrowing & accounting tricks. The era of "big government" is over. Reality check is starting to hit, and it's not pretty… and will quickly get worse. Time to return to the basics & a much smaller, Constitutional federal government. It will be painful, but it needs to be done asap. The more it is postponed, the worse the pain will be.

    35. Robert H. Davidson says:


    36. Gene says:

      I echo Mike Thomas's sentiments exactly. I'm in early retirement. I was unemployed, basically since 2002, the Bush era. The low paying work I found did not help keep me out of harm's way. Those Bush tax cuts did not create high tech jobs for me. If they want to cut the deficit, take it from the Military Industrial Complex, not from me. Incidentally, for those who want to blame both parties, it's OK by me. My other period of long-term unemployment came in 1993 when Bill Clinton was in office. I blamed it on the "downsizing, rightsizing, restructuring" nightmare. But, it was also due to a big leap in technology that was replacing more and more people with computers and automation, as well as more college graduates with newer skills and maybe the evolution of more women in the workforce, as well as "outsourcing" and NAFTA. I also agree with Dale who stated that we just need to "clean house". In any event, government may be "too big", but that's because the country and the population is huge. So, if we're going to clean up government, then maybe we should clean up our own act.

    37. JCH says:

      It's about the spending, STUPID!

    38. Jill Maine says:

      Yeah but Clinton was dragged kicking and screaming to the center. We can thank the GOP majority in Congress at that time. OBama is a menace to our country and I wish we could fire him today. Meanwhile he's celbrating his birthday for a week and real heros won't be celbrating any birthdays any more. Is he meeting their plane? No. He's off compaigning. God help us.

    39. Donald DaCosta says:

      "It can be done."
      The reality is that it will not be done with this President and this Senate as it is now constituted. 2012 cannot come fast enough and then one can only hope that the Progressive spin machine malfunctions, big time.

    40. Arvid Myhre says:

      I cannot imagine why anyone would believe that the incompetents that brought us to this level of disaster would be the ones to bring the economy back. We are led by biased judges, incompetent representatives and senators and a president that is a total idiot and doesn't have a clue. Why are we spending 10's of billions on ILLEGAL imigrants? Why are we giving 10's of billions in foreign aid to enrich a few leaders and to people who hate us? Why do we allow politicians to spend 100's of billions of our money to buy votes with un-necessary social programs and entitlements? The much maligned Tea Party and The Heritage Foundation seems to be the only groups that seems to have the solution to bring the country back figured out. I 68 years old, I have seen tough times and I have seen good times but now all I see is my country falling to pieces because of grossly incompetent and greedy leadership. I will never give another nickel to elect a politician.

    41. Glen says:

      Maybe,just maybe, if the gov't did just what it was designed to do, we wouldn't be in this mess. The Federal Gov't main purpose is to protect us, not to interfere with every aspect of our lives.The Presidents main function is to be the spokeman for our country,not the sole dictator. This pided piper is leading his fellow minions down a path of total destruction, and they can not see it. Wake up before it is to late.

    42. Bill Person says:

      This fiscal "crisis", a word Obama loves, is abslutely NOT CORRECTABLE until th culture in Washingto0n changes from one of "bring home the bacon" to one where fiscal and budgetary sanity is their priority. The incentives for fiscal performance need to be changed need to be changed.
      Not one of us having been elected to Congress would do anything differently unless we were paid on our fiscal performance. Sound like private enterprise?

    43. Charlie says:

      Blaming the tea party for this mess, downgrade and stock market meltdown is like blaming the interventionist who's trying to take away the meth/crack/dope from the addict. It makes them so terribly transparent; I just hope they up with their excuses right through November of 2012.

    44. ckirkland says:

      Our biggest problem is this current administrtion that wants to collapse capitalism so that they can start their Maxrsist/socialist govt. Obama and his Chicago gang should be doing the perp walk for what they are doing to this country. Our liberties are fading daily. What can any liberal tell us about obama, you probably know more what apps your Ipod offers than you can tell any of us about obama. We know he plays golf and loves to ride in Air Force One, and party in the White House. That's about all. ck

    45. Wayne says:

      An experiment.

      Go to the bank, and explain the following to the loan officer:
      1) Your annual expenses have exceeded your annual income for the last 50 years or so.
      2) Every time you max out your credit cards, you get an increase in the credit limit.
      3) You have a good credit rating because you have always paid the interest due on your debts, even when you've had to borrow more money to do it..
      4) You have now maxed out all your credit cards again.
      5) You would like to get a 15 to 20% increase in the credit limit of your credit cards so that you can borrow more money to pay the current interest due and have more money to take care of current expenses.
      6) Let us know how the loan officer reacted.

      If someone doesn't really understand the current debt situation, this may help them.

    46. You actually make it seem so easy with your presentation but I in finding this topic to be actually something which I think I would never understand. It seems too complex and extremely extensive for me. I’m having a look forward on your subsequent publish, I will attempt to get the cling of it!

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