Obama’s four years have seen the four highest deficits since 1946.
The political strategy behind Obamanomics was always simple: Call for “stimulus” to rescue the economy, run up the debt with the biggest spending blitz in 60 years, and then when the deficit explodes call for higher taxes. The Congressional Budget Office annual review released yesterday shows this is all on track.
CBO reports that annual spending over the Obama era has climbed to a projected $3.6 trillion this fiscal year from $2.98 trillion in fiscal 2008, or more than 20%. The government spending burden has averaged 24% of GDP, up from an average of about 20%. This doesn’t include the $2 trillion tab for ObamaCare.
All of this has increased the federal debt by about $5 trillion in a mere four years. Thanks to higher revenues, the federal deficit will decline to $1.08 trillion in 2012, or 7% of GDP. But that is still the highest deficit since 1946—except for the previous three years. In other words, the four years of the Obama’s Presidency will mark the four highest years in spending and deficits as a share of the economy since Harry Truman sat in the Oval Office.
EPA
And don’t forget the national debt held by the public—the kind we have to pay back. On President Obama’s watch, CBO says public debt will climb this year to 72.5% of the economy from 40.3% in 2008. This isn’t as high as Italy or Greece, but it’s rising fast toward the 90% level that begins to debilitate an economy. (more…)
Now that the governor has controlled state spending, he’s pushing tax reform and hoping to steal businesses and residents from neighboring blue states.
Garden State Gov. Chris Christie has a message for the top 1% of income earners: Please occupy New Jersey. “I’m going to start going after a lot of these hedge-fund guys who are in Connecticut and New York and say, ‘You’re going to get a better deal with us,'” says the country’s most important Republican not running for president.
Mr. Christie’s new tax-reform plan also offers an improved deal to the bottom 99%, which is why he may be able to move it through New Jersey’s Democratic legislature: a 10% cut in tax rates across the board.
The governor is two years into a four-year term. In 2010, he told the Journal’s editorial board that the Garden State represented America’s best example of a “failed experiment” in rising taxes and bigger government. As he returns to the Journal for another visit, it’s time to check the results of his counter-experiment.
Politically, so far so good. A recent Quinnipiac poll gives him a 53% approval rating among the state’s registered voters, and Mr. Christie says that private polls show him “in the low 60s.”
Economically, unemployment in the state has fallen to 9% from a high of 9.8%. With almost 3.9 million people working, New Jersey has added almost 60,000 private-sector jobs since he took office, while shedding more than 21,000 government jobs. Reforms of the pension and health programs for government employees will save taxpayers an estimated $120 billion over the next 30 years. A new limit on local property-tax increases appears to be working. (more…)
EXCERPT FROM THIS ARTICLE: Unfortunately, defense cuts do not occur in isolation. They feed a syndrome best typified by an insolvent and largely defenseless, socialist Europe. The more prosperous societies cut their defenses to expand social programs, the more the resulting dependency leads to even less defense and evermore benefits. Once the state promises to take care of the citizen, the citizen believes more subsidies are still never enough. Once voters believe that defense spending is an impediment to greater entitlements, the fewer impediments they will pay for. The net result is something like the squabbling, soon-to-collapse European Union: trillions in unfunded entitlement liabilities and unable to defend itself.
President Obama just ordered massive cutbacks in defense spending, eventually to total some $500 billion. There is plenty of fat in a Pentagon budget that grew after Sept. 11, 2001, but such slashing goes way too far.
Fairly or not, the cuts will only cement a now-familiar stereotype of Mr. Obama’s desire to retrench on the world scene. They follow symbolic apologies for purported past American sins, bowing to foreign royals and outreach to the likes of Iran and Syria. Abroad, such perceptions can matter as much as reality, as our rivals begin hoping that Mr. Obama is as dubious about America’s historically exceptional world role as are they. (more…)
– The Foundry: Conservative Policy News Blog from The Heritage Foundation – blog.heritage.org –
Morning Bell: A Slashed and Burned Military
Posted By Mike Brownfield On January 27, 2012 @ 9:35 am In Protect America | 79 Comments
The future is not bright for the U.S. military. Yesterday, Defense Secretary Leon Panetta gave America a glimpse of the half-trillion dollars in defense spending cuts requested by the Obama Administration and detailed how the U.S. military’s capabilities would be affected in practical terms. The result is a slashed and burned military that woefully lacks the forces it needs to meet America’s security challenges on a global scale.
On the ground, in the sea, and in the air, American forces will shrink drastically — the Army will shrink by 72,000 people, the active Marine Corps will be reduced by 20,000, the Air Force will see six tactical fighter squadrons de-established while an additional training fighter squadron will be eliminated, the next-generation F-35 Joint Strike Fighter procurement will be slowed, and the Navy will retire seven cruisers and two amphibious ships at an early juncture while delaying the procurements of new ships. To put these cuts in context, we are returning to ground forces levels we had under President Bill Clinton when the Army strained and scrambled to execute smaller missions like Kosovo and Bosnia–let alone significant ground force operations. (more…)
On Thursday, the Pentagon will begin detailing its plans to cut $500 billion from the military’s budget over the next decade. The reason, insists President Barack Obama, is that “since 9/11, our defense budget grew at an extraordinary pace.” That’s true in top-line numbers—but it’s anything but true when examined strategically.
Between budget cuts, cost overruns, overweight bureaucracy, ever-growing red tape, and changing requirements, the arsenal of democracy has become a bureaucratic nightmare. In spite of itself, our military cannot build new programs anymore. Old programs might win wars, but with much higher human and financial costs.
After 9/11, defense budgets grew because they had to. The U.S. military’s budget, size and force structure had been too deeply cut in the 1990s, after the anticipated post-Soviet “peace dividend” failed to materialize. So the Pentagon began quickly and inefficiently dumping dollars into the military to fund the missions in Afghanistan and Iraq.
This made budgets grow steadily, but the money did little to increase cutting-edge capabilities for the future. Our war-related investments came at the expense of tomorrow’s military capabilities. As a new American Enterprise Institute study concludes, the military over the past decade didn’t modernize but rather embraced the equivalent of buying new apps for its old, clunky cellphone.
Associated PressThe Air Force wanted 750 F-22s to replace the F15, above, but they ultimately only received 187.
From 2000-2010, the Air Force spent $38 billion on 220 fighters—as compared to $68 billion for 2,063 fighters from 1981-1990. Air Force leaders wanted 750 F-22s to replace their F-15s, but successive administrations cut that number—to 648, then 438, 339, 270 and finally 187—before President Obama terminated production. That wasn’t a coherent acquisition strategy but budget-driven politics, plain and simple. (more…)
Here’s the full text of Mitch Daniels’s response to the State of the Union, as prepared for delivery:
“The status of ‘loyal opposition’ imposes on those out of power some serious responsibilities: to show respect for the Presidency and its occupant, to express agreement where it exists. Republicans tonight salute our President, for instance, for his aggressive pursuit of the murderers of 9/11, and for bravely backing long overdue changes in public education. I personally would add to that list admiration for the strong family commitment that he and the First Lady have displayed to a nation sorely needing such examples.
“On these evenings, Presidents naturally seek to find the sunny side of our national condition. But when President Obama claims that the state of our union is anything but grave, he must know in his heart that this is not true.
“The President did not cause the economic and fiscal crises that continue in America tonight. But he was elected on a promise to fix them, and he cannot claim that the last three years have made things anything but worse: the percentage of Americans with a job is at the lowest in decades. One in five men of prime working age, and nearly half of all persons under 30, did not go to work today.
“In three short years, an unprecedented explosion of spending, with borrowed money, has added trillions to an already unaffordable national debt. And yet, the President has put us on a course to make it radically worse in the years ahead. The federal government now spends one of every four dollars in the entire economy; it borrows one of every three dollars it spends. No nation, no entity, large or small, public or private, can thrive, or survive intact, with debts as huge as ours. (more…)
Today’s defense cuts are recreating conditions that led to Pearl Harbor
By Adm. James A. Lyons Retired Adm. James A. Lyons was commander in chief of the U.S. Pacific Fleet and senior U.S. military representative to the United Nations
The Washington Times
Tuesday, December 6, 2011
associated press The battleship USS Arizona belches smoke as it topples over into the sea during a Japanese surprise attack on Pearl Harbor, Hawaii, on Dec. 7, 1941.
EXCERPT FROM THIS ARTICLE: The political correctness imposed on our commanders leading up to the attack on Pearl Harbor, regretfully, resonates in today’s military, including the war on terrorism and our efforts to defend ourselves from China
As we mark the 70th anniversary of Imperial Japan’s attack on Pearl Harbor of Dec. 7, 1941, America is on the verge of committing the same mistakes that helped plunge our nation into its most grievous war.
The first mistake then was to impose the strategic restraints of “political correctness” on our Hawaiian military commanders. Adm. Husband E. Kimmel, commander in chief of the U.S. Pacific Fleet, was ordered by Chief of Naval Operations Adm. Harold R. Stark to prepare the fleet for deployment but not do anything provocative that might offend the super-sensibilities of the Japanese. Lt. Gen. Walter G. Short, commanding general of the U.S. Army Force in Hawaii, who was responsible for the air defense of the Hawaiian Island including Pearl Harbor, was ordered not to take any offensive action until the Japanese had committed an “act of war.” Does it sound familiar? (more…)
From Greece to Washington to New York state, there’s no effective mechanism to control spending.
By DAVID MALPASSMr. Malpass, a deputy assistant Treasury secretary in the Reagan administration, is president of Encima Global LLC
EXCERPT FROM THIS ARTICLE: Governments on both sides of the Atlantic are trying to use the crisis to grow rather than shrink. News of Europe’s fiscal incompetence abounds, but Washington had no budget at all in 2010 or 2011 and the federal deficit grew at record pace. President Obama sailed through 2011 without any significant spending cuts or government downsizing.
Across Europe and the United States, the fiscal crisis is setting up an epic battle among government services, pensioners, government employees, creditors and taxpayers. There is simply not enough money coming in to pay all the promises politicians have made. The shortfalls and fights are challenging our democracies and shifting wealth from the private sector to ever bigger government.
The hope has been that Europe’s debt crisis would force government downsizing in time to meet cash flow requirements. Newfound fiscal discipline would provide a silver lining to the debt crisis. But that’s not working out.
Germany’s insistence on centralized fiscal discipline for the euro zone will lead to a massive expansion of bureaucracies in Brussels, Frankfurt and Berlin. They’ll include temporary and permanent bailout funds, dangerously intrusive powers for the International Monetary Fund and the European Central Bank, endless summits, new taxes on property, and recessions. (more…)
associated press The battleship USS Arizona belches smoke as it topples over into the sea during a Japanese surprise attack on Pearl Harbor, Hawaii, on Dec. 7, 1941.