United Liberty

The more connected you are, within the Washington D.C. circuit; and on the long-stretch between Los Angeles and New York, the more clout you have as a politician. Especially, if you’ve squandered taxpayer money on “bridges to nowhere” (Rick Santorum), Olympic “Games” (Mitt Romney) or have been kick-backed by Fannie & Freddie (Newt Gingrich).

All these, of course, are fine examples of Capitalist enterprise, of leadership and smart capital-management. But what do all these undertakings reveal, about abilities in leadership, necessary to plug the dam of the 2008-unward recession? Not, much.

Ron Paul is the antithesis. He negates almost in it’s entirety, every other issues brought by his opponents in the GOP presidential race. He is not reported on, because those who indeed try to, fail miserably: the way Gerald Seib did, moderating the Republican Debate in South Carolina. Ron Paul is too honest: clear, succinct, philosophically astute. This makes him a slippery fish, to place in the Republican Party, although he is by far the most consequently, stalwartly arch-conservative since that other Gipper, that slipped his way into the White House: Ronald Reagan!

Being less ‘politicized’, in other words by having put his neck out on an execution-block, or guillotine, to amass money, has meant he has to do with less campaign finance. But what Paul has lacked in initial spending, his patriots have donated in turn. No other US politician has ever raised a sum, close to over 1 million, which Paul’s campaign has been able to do in 2011. What this means, is; people base decision on mass-media, pandered bits-and-pieces of evening chatter, boxed soundbites (often misinterpreted) while heading out the door in the morning. Ron Paul is lucky to get 3 minutes airtime, after a debate platform.

There are few times when I find someone who says exactly what I was saying. This just happens to be one of those times, as I just found this video of Veronique de Rugy from the Mercatus Center on reason.tv speaking about entitlement programs and creating a social safety net:

This.

[Ed: That’s a little short for a blog post. Me: Oh.]

I’ve been telling my friends, coworkers, relatives, and anyone else who will deign to hear my opinions that I have no problem with a social safety net for the truly poor in society. Scale it back, reform it, design it so that it incentivizes improving oneself and not sitting around all day waiting for the check (and for the love of Milton Friedman, let’s get the 80+ cash transfer welfare programs down to some number I can count on one hand) yes, I am totally onboard with all of that and more, but I do not think that in the modern world we can simply eliminate the social safety net entirely. There are arguments for having at least a minimal system for the truly poor, to roughen out the edges of the market, and giving them a helping hand back up.

There are no arguments, however, for giving money to people simply because they are old. None. Poor yes, I can see that, but there are simply none for the elderly other than purely emotional ones—and even they are specious. As cold and brutal as it sounds, what value are the old creating for society? They are not being productive, whereas the young are. And then we get into wealth.

You may have heard in recent days that the poverty rate in the United States jumped as a result of the recent recession. No doubt this will be used to justify more increases in spending, though Washington hasn’t needed a recession to increase spending on anti-poverty programs.

This chart from the Heritage Foundation shows spending for the individual programs and how much they have increased over the last 10 years. Note that while spending for welfare programs is at a record high, it has been a record levels since the “compassionate conservative” presidency of George W. Bush.

Despite all of this spending, the poverty rate has not only not changed, it has gone up, and since the passage of Great Society programs, which include Medicare and Medicaid, the trillions of dollars spent in the War on Poverty have been as effective as government crusades against some social ill, such as the War on Drugs, has been…a failure.

I.O.U.S.A., a great documentary on the problems with our nation’s debt, has been put online for streaming. I don’t agree with some of the suggestions offered, but it’s well worth watching to get a sense of how much trouble we’re in.

While you’re watching, keep in mind that the national debt has soared since this documentary was released in 2008 to $13.1 trillion.

You can watch it below in its entirety.

The Treasury has released the 2009 Financial Report Of The U.S. Government, which is full of facts, charts and figures on the fiscal health of the country. Let me tell you, if you even have the slightest understand of basic economics, this report should trouble you.

I’ve pulled a couple of the charts to give you an idea of how screwed we really are. Let me be clear in saying that I am not blaming this on the current administration. They are, however, doing nothing to deal with the problem. In fact, they are doing what previous administrations have done…building on past fiscal irresponsibility with more fiscal irresponsibility.

This first graph shows that without major policy changes, debt as a percentage of gross domestic product (GDP) will exceed 200% in the next 35 years. It gets even worse as you can see below. Part of the reason is demonstrated in the next chart.

As you can see here (click to enlarge for better detail), interest on the national debt becomes more of a problem than entitlements, which is what many fiscal conservatives often talk about. This is a financial burden that cannot be solved by simply raising taxes, because with that economic growth is put at risk.

Over the last few decades, annual government spending as a percentage of GDP has been around 20%. However, In the next 20 years, spending as a percentage of GDP will hit 30% and it will just continue to grow.

Here is a look, thanks to Matt Welch over at Reason, at government spending over the long-term. The standard of government spending, until the last couple years, has been 20% of gross domestic product (GDP).

Thanks to booming entitlement spending, specifically in Medicare and Medicaid, the future does not look bright for taxpayers.

Over at Reason, Peter Suderman hammers Republicans for pandering on Medicare during the health care “reform” debate:

Congressman Paul Ryan’s Roadmap for America’s Future—his sweeping entitlement and budget proposal—would cut Medicare. It would cut Medicare by a lot—more, as Paul Krugman notes, than even ObamaCare would cut it. Indeed, that’s exactly the point, and the virtue of the proposal: In its current form, Medicare is unsustainable. Unlike ObamaCare, Ryan’s proposal would fix that. And unlike ObamaCare, it would not plow funds generated from those cuts back into propping-up and expanding a failing, third-party-payer, employer-provided insurance system that pretty much everyone dislikes. But yes, it would cut Medicare significantly.

That’s a good thing, except that the Republican party is going to have a tough time fully embracing it. The problem is that by using opposition to Medicare cuts to build opposition to ObamaCare, the GOP has rendered itself unale to seriously deal with the program’s long-term problems.

I know what you’re thinking: man that Pete is a positive guy. I like to describe myself as realistic, with a bit of fatalism throw in. Either way, I find it hard to look at the economic landscape and have any hope. It is especially dreadful when politicians have to get re-
elected, AND said politicians consult certain “economists”.

Economists have for years looked at what is happening in a society and sought to come up with solutions as to how an economic crisis can be “fixed”. The problem is, like in all fields, you have good economists, and you have the not so good (The latter seem to be the ones that always find their way onto the public payroll).

In extremely broad terms economists can be split into two categories:

If you are a student of American history your eyes should be opening as to which economist is most often chosen by our elected officials. The real question is “why”?

Well, why wouldn’t a politician pick economist #2?

What will they think of next? Our nation is in the midst of a national recession not seen since the Great Depression. Tax revenues are in decline. Every agency in Alabama is in proration. Yet as many as 560,000+ households in Alabama are about to qualify for free cell phones (more than 25% of the state!).

Read the article here.

I don’t care what anybody says; if we live in a country where the “poor” get free cell phones, we have no real poor here.

Notice that this program only gives recipients about an hour of talk-time per month—but allows them to buy additional time for 20 cents a minute (and most do). If these people are supposed to be poor, how are they able to afford to pay for this extra time?