CONARTISTS ARE RUNNING THE COUNTRY
While the News Media Continues to Whither

MAXINE WATERS
"These cuts will cost America 170 million jobs"




March 2, 2013 TPATH - Last week we posted the facts about the sequester.  This week the political hysteria continues as the media, Fox News included, and big government leftists march forward with fear tactics and just plain lies.  Then, Maxine Waters, who actually is dumber than Joe Biden, announced that the cuts in government growth will cost 170 million jobs.  Someone may like to point out to this jewel of colossal ignorance, America only has 140 million people working right now.  Which by the way is about 2 million less than when the usurper took office. 

First we need to take a quick look at the chart above and note the drastic "so called" cuts, keeping in mind as you do, that if the entire sequester amount  is applied, the Federal budget will, in fact, still grow as a result of automatic budget increases to every single government program.

What does this mean?  Well, common sense would dictate that not one person would lose his job, not one program would be cut or closed down, they just would not grow as much in this next year as the progressives had planned.  Amazingly enough, only in Washington is a net increase considered a cut.

For certain every news reporter, news channel and politician understands this shell game being played.  Well, Except for Maxine Waters who probably doesn't know where she parked her car.  All of these people are hoping that Americans are as stupid as Waters. Okay, maybe not that stupid, but stupid none the less.

While its true that a large portion of the sequester amount was earmarked for the Military, which by the way clearly indicates this foolishness was designed by Hussein Obama, if the balance of the cuts in growth were spread out across the vastness of government programs, not one person would be fired or furloughed.  Remember, your President, he's not mine, he has told me that many times over the past four years, is using this sequester as a tool to further beat down the poltroon Republican Party at the expense of many hardworking families who just happen to be employed by the government.  This is beyond despicable but entirely consistent with they way leftist people and governments use its citizens as fodder.

A final and very important point on this is that Obama has refused to allow a Senate bill to pass which would give him sole authority as to which areas of growth would be cut.  This may sound a bit out of character for the "exalted one" but he needs to be able to blame anyone and everyone, except himself, for any services lost.  If he had the complete sequester disbursement authority, he might get blamed.

This seems a bit paranoid for him, since the media has looked the other way after he went to bed while American heroes were being slaughtered in Benghazi, billions of dollars were being given to the Muslim Brotherhood, Communists, Islamic extremists and home grown terrorists made up his inner circle, an arsenal machine guns and weapons were handed over to Mexican drug cartels, and shoulder fired missiles, capable of taking down passenger airliners, were provided to Muslim fanatics

The Real Problem With the Sequester
By A. Barton Hinkle
Thursday, February 28, 2013

To hear President Obama and his hod-carriers in the prestige press tell the tale, the sequester that is about to commence will produce an economic and social-welfare apocalypse of nearly biblical proportions. About that, there are three points worth making.

The first is that the sequester was Obama's idea in the first place. When the White House pitched the idea to House Speaker John Boehner, he balked. When it pitched the idea to Senate Majority Leader Harry Reid, he called the proposal "insane." But the administration pressed, and eventually got its way. Having gotten its way, it now prophecies doom and destruction as a result of the very policy it produced.

The second point is that those prophecies of gloom and doom are, very likely, overwrought. Take projected defense cuts. On a micro level, they will cause genuine pain as federal workers are furloughed and weapons contracts are torn up. On a macro level, however, the effect of such activity is not likely to be nearly so great as the White House – and, to be fair, Republican politicians in defense-industry states like Virginia – would have everyone think.

As Benjamin Zycher of the Pacific Research Institute has pointed out, "real defense expenditures grew every year from 1981 through 1989 and then fell in eight of the subsequent 11 years." If defense spending is so crucial to the economy, then you would expect GDP to rise and fall accordingly. But it didn't. The economy grew steadily every year in that period except for 1982 and 1991.

Still, there's little dispute that the sequester could do some damage. This brings us to the third point, which has to do with the most serious problem related to the sequester: That is the fact that federal spending is now so thoroughly interwoven into the fabric of the national marketplace that we have to worry about its effect in the first place.

How did we get to the point where the health of the world's largest economy is contingent on fluctuations in government spending? The full answer to that is an epic saga. But we can sketch out the bones of the story easily enough.

One of the largest drivers is social-welfare spending, which has more than doubled in the past 20 years (after adjusting for inflation). According to the Heritage Foundation, fully 62 percent of the federal budget now goes to entitlements. Jeffrey Miron, writing in National Affairs, notes that "if the $1.45 trillion in direct [federal] anti-poverty spending in 2007 had been simply divided up among the poorest 20 percent of the population, it would have provided an annual guaranteed income that year of more than $62,000 per household." Unfortunately, "much of the redistribution goes to middle-class families," while more is siphoned off to pay for the operation of the various programs aimed at fighting poverty.

Those programs are the result of Lyndon Johnson's famous War on Poverty – an enterprise that has cost upwards of $16 trillion to date, with no end in sight. Johnson's 1964 State of the Union address announced the commencement of hostilities against poverty with martial rhetoric. He declared "unconditional war"; warned that "no single weapon or strategy will suffice"; asserted that the "attack, to be successful," would have to be waged "in the field, in every private home, in every public office, from the courthouse to the White House. . . "

In other words, full national mobilization was needed to meet an urgent crisis. But as Robert Higgs has explained at length in his excellent "Crisis and Leviathan," government uses crises to amass power and resources beyond what is necessary – and then retains much of those powers and resources long after each crisis has subsided. The result is what Higgs and others have described as a one-way ratchet of government expansion.

A look at WWII illustrates his point nicely. In 1940, federal outlays totaled less than (brace yourself) $10 billion. By 1945 they had soared to nearly 10 times that level. After WWII they fell again – but not to anywhere close to pre-war levels. In 1948 they were still three times as high as they had been only eight years before.

So it has been with the War on Poverty as well: Programs have proliferated and grown to the point that now, counting only programs that are means-tested, there are now 126 federal anti-poverty programs that cost, in 2012, nearly $670 billion.

Efforts to roll back the growth of government, by contrast, look remarkably feeble. Although Ronald Reagan promised to "control the runaway growth of federal spending," from 1980 to 1988 federal outlays nearly doubled. Much of this was owing to Reagan's defense buildup – which, many argue, was justified by Soviet expansionism. The trouble is that Reagan did not offset that buildup with cuts in social-welfare spending. The result was a massively larger federal leviathan.

A similar pattern occurred under George W. Bush. In response to the crisis of 9/11, Bush launched two wars. But far from slashing social spending, he also added significantly to it with the Medicare Part D prescription-drug benefit. Conservatives, too busy cheering on the expansion of military might, did not bother to object much to these increases in social-welfare spending. The Obama presidency has produced a similar dynamic. Liberals, delirious with joy at the current president's expansions of the welfare state, have not groused too loudly about the growth of Pentagon spending. That growth represents another case of ratcheting: Despite the drawdown of two wars, Pentagon spending will continue to rise. The sequester might slow the rate of growth, but it will not produce year-over-year reductions in defense appropriations.

The result of all this is that the federal government consumes, over time, a greater and greater share of the economy. As recently as 1948, total federal outlays were only 11 percent of GDP. But they keep creeping up, and now stand at roughly 23 percent. If forecasts are accurate, they will reach 35 percent of GDP within a couple of decades.

And therein lies the real problem. If government were small, then abrupt changes in federal outlays would hardly matter. Because government is huge, they matter considerably. President Obama is wrong to pretend that if the sequester gives the federal government a cold, the rest of America will catch malaria. But given the immense degree to which federal spending is now interwoven with the rest of the economy it should be no surprise if, when Washington gets the flu, America gets the sniffles.  

A. Barton Hinkle is an editor and columnist at the Richmond, Va., Times-Dispatch and a contributor to Reason magazine.

The American People Need Real Spending Cuts

By Sheldon Richman Wednesday, 
February 20, 2013
 

President Obama and other so-called progressives insist that the American people are not overly dependent on government. They also predict dire consequences if the automatic budget "cuts" known as sequestration take place March 1.

 

Both claims cannot be true. If modest across-the-board "cuts" — mainly cuts in the rate of growth — in military and domestic spending pose a threat to the American people and the U.S. economy, then the country is alarmingly dependent on government.

 

Federal spending has grown dramatically since the 1970s, with the biggest increases coming during Republican administrations. Spending today is hundreds of billions greater than in 2008 and much higher as a percentage of the economy. True, it is lower now than in 2009, but that year, a combination of George W. Bush and Obama "stimulus" spending, set a record.

 

The sequester consists of $1.2 trillion in across-the-board cuts in non-entitlement spending growth over ten years. To put that in perspective, Reason editor Nick Gillespie writes, "Remember that we're talking about $1.2 trillion dollars taken out of a projected $44 trillion or so in spending. What kind of budget discipline is that?" 

 

As that March 1 sequester approaches, the Obama administration warns of severe consequences for national security and economic security.

 

 

It is hard to take seriously the claim that even a small and temporary decrease in Pentagon spending would endanger the American people. Military spending has skyrocketed since the year 2000, and the United States spends almost as much on the means of war as the rest of the world combined — indeed, it spends more than it did at the height of the Cold War. The U.S. military is now out of Iraq and is beginning to leave Afghanistan. One should expect a fall in spending under those circumstances — unless the government plans to invade more countries.

 

Yet Obama and outgoing defense secretary Leon Panetta foresee great danger. Nonsense. As analyst Veronique de Rugy writes, "Defense spending has almost doubled in the past decade in current dollar terms and will continue to grow in spite of automatic cuts." Summarizing Rugy's findings, Gillespie writes, "Assuming maximum sequestration, Defense would increase only 16 percent in current dollars over the next decade, rather than 23 percent without sequestration." Some cut.

 

Of course, much could and should be cut from the military by ending the U.S. government's imperial foreign policy — which makes enemies for the American people — and moving to a policy of strict noninterventionism. This would not only save money; it would be the right thing to do. The U.S. government should not be policing the world.

 

What about the claims that a spending slowdown would harm the economy? We're told the economy could fall back into recession if spending is not maintained at the vigorous pace previously planned. After all, it is argued, if government workers are laid off and fewer military contracts are written, less money will be in people's hands to spend on goods and services. Considering that the government wouldn't actually have less revenue under sequestration, this is an outrageous exaggeration if not an outright lie. Of course, beneficiaries of that spending — especially the parasitic politicians and the military-industrial complex — have every reason to mislead the taxpayers. The people's natural interest in lower taxes and lower government spending must be overcome somehow. Frightening them into believing that even a slowing of the growth in spending would wreck the economy is just the ticket.

 

Even if it were true that the economy would slow down, it would be no more than a short-term effect that would quickly give way to real, sustainable economic growth, assuming the government took other needed steps to free the economy. Government employees and contractors spend the taxpayers' money. If the largess ends, the producers of that wealth will be free to spend and invest as they like. That's not only just; it's how sound economies are generated. Politicians use the force of the state to shape the economy to their own purposes. That violates freedom and stifles prosperity.

 

Contrary to the Keynesian ruling elite, government does not generate economic growth. The free market, unburdened by spending, taxes, regulation, and privilege, contains all that it needs to raise living standards for all. After sequestration, let's start seeing real and substantial cuts in spending.

 

Sheldon Richman is vice president and editor at The Future of Freedom Foundation (www.fff.org) in Fairfax, Va.