Showing posts with label debt crisis. Show all posts
Showing posts with label debt crisis. Show all posts

Wednesday, 10 August 2011

Just What is Going On In The World?

We have riots in the streets of London, Al Shabaab fighting to keep western aid from reaching millions of starving people in Africa, stock markets around the world on a roller coaster ride from hell, mass killing going on in Syria and an American president who has failed his people on the economy, just to name a few.

It is a world in turmoil, the likes we probably have not seen since the second world war and it doesn't look like it will get better any time soon.  Which begs the question, what can we do to fix things?  My common sense solutions below.

Our world for the most part has been living life like socialists for far too long. Even the right side of the political spectrum has been giving free hand outs far too often.  We need to get back to our roots, where people were not afraid to put in an honest days work, raise a family, and expect nothing from government unless it is an unforeseen circumstance such as drought, hurricanes, earthquakes and the like.  Far too often we look to government to step in when times are tough, instead of rolling up our sleeves and getting to work like our forefathers did.  If we truly want change we have to look inside ourselves and decide that change has to start from within.  We are the ones who need to change, we need to stop with the handouts, dig deep and get things done!

Solution for anarchy in London and everywhere else.  Make the people pay for their actions!  Too long have we allowed this kind of stuff to go on without serious consequences.  Sure, have your peaceful demonstrations but if you get out of line you are going to jail, it is that simple.  How many of these people would be out doing what they do if they knew that they would get much, much more than a slap on the wrist?  If the justice system actually enforced the law these people would be looking at years in jail.  It is time to make the justice system work the way it is supposed too and stop pandering to the far left.  This will bring people back down to earth and make them accountable for their actions.  The use of rubber bullets, tear gas, and other methods should be allowed as soon as the police see actions like this ongoing.  These anarchists will soon fall in line, or at least learn how to have a peaceful demonstration.

Starvation in Africa.  This can be called a man made disaster, yes the drought is out of our hands but the price of food has also played a very large roll in this.  The price of food is being driven by the countries such as China and India as well as others.  But also adding to this is the use of food products being used to produce fuels.  This action, especially in the U.S. and Canada has made grains much more expensive which in turn boosts costs of feeding livestock and other meats.  What needs to be done, especially in the States is a move to a more efficient product such as switchgrass.  This stuff can be grown anywhere and does not consume as much energy to produce biofuels.  The energy needs of the U.S. can also be alleviated by drilling for fuels at home.  There has been too much of this "not in my backyard" B.S. and for generations the U.S. has not allowed energy companies to drill some very large economical areas that would dramatically decrease the country's dependence on Middle Eastern oil.  This would mean jobs, taxes and much much more for the U.S. economy, something they dearly need.  But first the left need to get the hell out of the way and let the people who actually want to help the country do their job!  There is enough natural gas in the U.S. to last generations, which will buy them enough time to develop other means of energy that are currently under development.  It is a band aid on the problem but one that could tie them over until these new energy strategies come to fruition.

The U.S. economy and it's affect on the world as a whole.  The powers that be in Washington need to start working for the people and not for their own political agendas.  There needs to be serious cuts to spending, not this piece of junk that they tabled last week which does nothing to cut their debt.  It in fact allows the debt to grow to 20 trillion dollars by the year 2020.  20 Trillion Bucks!!!  You think things are bad now, just think what their debt rating will be like by 2020!  Everything needs to be cut, the people just need to wake up and realize that they will have to do with less.  Less government handouts, less entitlement spending, less government employment opportunities and yes, less unions and their constant drag on a nations ability to compete on the international stage.  But this goes back to the change we need to find within ourselves, it starts at home and then you can hold your politicians accountable.  The Nancy Pelosi's of the world need to be run out of politics and vote in someone who will make the tough decisions, not the easy ones that will garner a lot of votes.  It is this way of thinking that has gotten us into this mess and it needs to change or the mess will just keep piling up.  The people in the U.S. need to also get over the "I don't pay tax" way of thinking.  In order to get this debt paid down a national tax on consumption is a must.  Everyone pays it on goods and services, not just the rich, and middle class.  The nice thing about a consumption tax is that it is a fair system that will tax the rich way more because they obviously would consume much more than the lower classes.  The national consumption tax would bring in un-foretold amounts of income to the federal government and help them get their great country back on track.  Tea Party, GOP, DEMS, it doesn't matter who you are, get your act together and do what is right for the country!

The Middle East uprising has been a missed opportunity for the west to show that we are behind our fellow brothers and sisters.  Our politicians are too slow to react and typically the reaction is not strong enough to prove solidarity.  We need actions, not just words.  Add in the U.N. which is being run like a kangaroo court and needs to make wholesale changes in order for it to be legit once again.  The security council laws need to change to make it majority rule instead of giving the permanent members the ability to quash anything that they disagree with.  It is either that or do away with the security council and let the vote happen between all member nations of the U.N. where 50% plus one means action.  This ability by Russia and China to hand tie the security council from recommending action is ridiculous and has made the U.N. the laughing stock of the world.  It no longer is legitimate and unless changes happen it will remain this way.  For far too long the U.S. and it's allies have had to police the world at it's expense.  If any action is needed in the world it should be international law that all expenses are shared by those who are part of the U.N. and then all money recouped by the country that has needed the help.  Then the trillions of dollars the U.S. spends in taking action would come back the the U.S. people, sounds fair doesn't it?  It has cost the U.S. a trillion dollars or more going into Iraq and Iran to liberate them, should this money not be paid back over time?

These are just some common sense solutions to a few of the world's problems, there are many more problems of course but these are the major ones right now and if these changes are made the world's economy would have a chance at stabilizing and the markets would return to normal.  Again, it is time to hold our politicians accountable and right the ship before it gets consumed by the wave of socialism.

Thursday, 4 August 2011

U.S. Debt Reaches 100 Percent of Country's GDP


U.S. Debt Reaches 100 Percent of Country's GDP

Published August 04, 2011
| FoxNews.com
The U.S. debt surpassed 100 percent of gross domestic product after the government's debt ceiling was lifted, Treasury figures showed Wednesday, according to AFP. 
The debt, which had been in somewhat of a holding pattern over the past several weeks, rose $238 billion after President Obama signed the debt-ceiling deal into law Tuesday to avoid the country's first-ever default. 
The package is designed to carve $2.4 trillion from the deficit over the next decade. But in the near term, it granted Washington an increase in its borrowing authority worth the same amount. 
With that authority, the public debt has climbed to $14.58 trillion, putting it just over the $14.53 trillion size of the country's economy in 2010. 
As the country moves into a league with deep-in-the-red nations like Italy and Belgium, fiscal conservatives say the fight to cut spending is far from over. 
Senate Minority Leader Mitch McConnell warned Tuesday that Washington will have another fierce debate over spending the next time the debt ceiling is reached -- expected to be in early 2013. McConnell said Washington should welcome, not fear, that debate. 
Bipartisan lawmakers are also expected to get to work soon on a joint committee formed by the newly signed debt-ceiling deal. That committee is tasked with finding about $1.5 trillion in deficit savings, to complement the $900 billion in cuts enacted by the first phase of the bill. 
The last time the debt topped the size of its annual economy was in 1947 during World War II, according to AFP. But the deficit at the time was driven by war spending -- a degree of spending that ebbed once the war ended. The nation's current deficits were exacerbated by the wars in Iraq and Afghanistan, but are also driven in large part by entitlement programs that will not shrink without fundamental changes to their structure -- officials point as well to lost revenue from the recession, tax breaks and increased domestic spending as contributors to the current deficit hole. 
Raising the debt ceiling came hours before Treasury would face the risk of defaulting on the country's loans. 
The contentious debate on Capitol Hill rattled Wall Street for more than a week, as the Dow slid for eight straight days before finishing up 29 points Wednesday.


Read more: http://www.foxnews.com/politics/2011/08/04/us-debt-reaches-100-percent-countrys-gdp/#ixzz1U4dxex1Y

Tuesday, 2 August 2011

Everything Rosy Now In Washington? Don't Bet On It!

With the debt ceiling raised for the next couple of years everyone who is voting for this legislation is saying it's not a perfect deal but the best one they could come up with at this point.  I agree that it is important to keep government running, but in the end at what cost?  Lost in all of this is the true national debt that the U.S. has which should scare the bejeezuz out of anyone.  Are you ready for this?  Figures brought out yesterday show that the U.S. has amounted an un-funded debt liability to the tune of $61 trillion dollars.  Yes, you read that right, $61 trillion dollars in un-funded liabilities like medicaid, medicare, pensions, ongoing contracts and more.  I am very nervous about our Canadian unfunded liabilities sitting at $200 billion.  To put it in perspective, we have 1/10th the population of the States, if we had the same amount of people our unfunded liabilities would be $2 trillion, which is $59 trillion short of what they sit at today.  WOW!


The problem is that everyone in Washington just wants to sweep this under the rug and forget about it.  Let our children and our children's children pay for it, as long as we live good today and keep the votes coming my way.  When is the insanity going to stop?  There has to be some common sense left in Washington?  Maybe not?  I watch the likes of Nancy Pelosi go on about how this new deal is going to hurt her constituents who have become used to government handouts.  It is the likes of Nancy Pelosi who have gotten things so bad in the U.S. ad at some point it will collapse under the weight of the debt.  Until they get serious about confronting their real debt I will not invest in the country and would not recommend anyone else to either.


The Tea Party has had a strong voice in this latest round of negotiations but even most of them don't truly know how bad the situation really is.



Tax reform to be next battle in U.S. fiscal war

 

US$1.5T must go

 
 
 
 
Round One in the U.S. debt debate ended up being all about spending cuts. Look for Round Two to be all about taxes.
 

Round One in the U.S. debt debate ended up being all about spending cuts. Look for Round Two to be all about taxes.

Photograph by: Getty Images, Getty Images

Round One in the U.S. debt debate ended up being all about spending cuts. Look for Round Two to be all about taxes.
If the deal to raise the U.S. borrowing limit and cut US$917-billion in spending is finally passed, the focus will switch to overhauling the tax system. The new debate may be even more acrimonious than the first go-round but could give the U.S. economy the desperate growth boost it needs.
As part of the deal, a 12member congressional committee of Republicans and Democrats from each chamber will be responsible for finding a further US$1.5-trillion in budget savings by Nov. 23 and could look to politically risky decisions not yet touched - including tax reform.
"Tax reform is the silver lining to all of this. It's really critical for the United States to change its current structure," said Andrew Busch, global currency and public policy strategist with BMO Capital Markets in Chicago.
"I thought tax reform wasn't going to happen until 2012, but I think the groundwork is going to get laid at that meeting," he said, adding that he expects the issue to be central to the next presidential campaign.
Much of the political focus has been on tax hikes for the richest Americans, with Republicans staunchly against new taxes as part of the solution to the debt crisis.
House Speaker John Boehner, the top U.S. Republican, sought to reassure conservatives that the deal is "all spending cuts."
Meanwhile, the White House has indicated if the new committee does not move ahead with tax reform, President Barack Obama will allow tax cuts put forward by former President George W. Bush to expire in 2013.
But Mr. Busch hopes the committee will focus on corporate taxes, arguing the current system makes it difficult for the country to compete globally and is holding back job growth.
If the U.S. moved to a flatter, simpler code - he suggests a corporate tax rate of 25% and eliminating costly tax breaks and exemptions - it would stimulate the economy, he said.
"First, it's a lower tax rate so you simplify the tax code and therefore you reduce the cost of doing business in the United States because they don't have to spend so much on accountants and tax attorneys.
"Second, for small businesses, you really reduce their costs... and they're the ones who are the job creators in the United States. You want to make them as viable as possible."
Mr. Busch also argued the United States should move from its extra-territorial tax system - that taxes domestic companies on overseas activity - to a territorial one.
"Companies keep a tremendous amount of money overseas," he said, noting that some of that will be spent on the cost of doing business abroad but in some cases multi-national companies simply keep money overseas to avoid taxation.
"This is all about reducing friction and reducing incentives for companies to keep their money overseas and that's really critical," he said.
He noted that the structure of the debt ceiling plan committee may not lend itself to agreement on these two issues, but suggested the pressure to make changes to the tax code to spur economic growth will only increase.
Either way, Mr. Busch predicted: "Whoever grabs a hold of this issue will likely make it to the White House in 2012."
cdobby@nationalpost.com


Read more:http://www.leaderpost.com/business/fp/reform+next+battle+fiscal/5190509/story.html#ixzz1Tt049VGM

Sunday, 31 July 2011

Is a Deal Close?


White House, Republicans inching toward debt deal

Senate Minority Leader Mitch McConnell, R-Ky., is pursued by a reporter as he arrives at his office on Capitol Hill in Washington Sunday, July 31, 2011, after speaking about ongoing debt negotiations on Sunday talk shows. (AP / Harry Hamburg)
Senate Minority Leader Mitch McConnell, R-Ky., is pursued by a reporter as he arrives at his office on Capitol Hill in Washington Sunday, July 31, 2011, after speaking about ongoing debt negotiations on Sunday talk shows. (AP / Harry Hamburg)

Speaker of the House John Boehner, R-Ohio, left, and Senate Republican leader Mitch McConnell of Kentucky, appear at a news conference as the debt crisis goes unresolved on Capitol Hill in Washington, Saturday, July 30, 2011. (AP / J. Scott Applewhite)
Speaker of the House John Boehner, R-Ohio, left, and Senate Republican leader Mitch McConnell of Kentucky, appear at a news conference as the debt crisis goes unresolved on Capitol Hill in Washington, Saturday, July 30, 2011. (AP / J. Scott Applewhite)

Updated: Sun Jul. 31 2011 09:48:30


The Associated Press
WASHINGTON — Washington politicians appear to be inching closer to an agreement that could end the bitter dispute over the debt ceiling and avert a federal default, but long-term problems remain for the U.S. economy.
The White House and congressional Republicans are, according to officials who spoke on condition of anonymity, discussing a deal that would see the U.S. debt ceiling raised by about $2.4 trillion in two steps while cutting federal spending by slightly more than that amount.
The first step, which would take effect immediately, cuts spending by about $1 trillion,. The remainder would be trimmed before the end of the year.
Senate Majority Leader Mitchell McConnell said on Sunday he was very close to recommending a tentative agreement to Republicans in the upper chamber.
The agreement would contain none of the tax increases sought by U.S. President Barack Obama and would introduce a constitutional amendment that would require a balanced budget, said McConnell. Republicans have been resisting any talk of tax hikes while Obama wants a deal that will stand until after the 2012 presidential and congressional elections.
A senior White House adviser later said both sides are in general agreement on a deal, though key details still need to be worked out.
Without a compromise in place by Tuesday, Aug. 2, officials say the Treasury will run out of funds to pay all the nation's bills. Such event is seen as a looming catastrophe that threatens to scuttle America's financial status and send economic shockwaves around the world. The political standoff has been marked by late-night negotiations and heated rhetoric on both sides of the aisle.
But even if the talks are successful, author and radio commentator Peter Schiff says the U.S. economy still faces challenges.
Schiff said the U.S economy is largely helpless to the lending ceiling of other countries, most notably China.
"The real ceiling is the one we can't raise," Schiff told CTV News Channel on Sunday.
"What happens when people lending [the U.S.] money say they've loaned too much to us and that they don't think we can pay it back?"
The bad news for the U.S. would be good news for China, Schiff added. "The Chinese economy will boom when they stop buying our debt but ours will collapse."
Schiff says individuals can protect themselves by "limiting their exposure" to the U.S. greenback. He says Canadians are relatively safe because of the strong loonie in relation to the U.S. dollar. Ottawa, however, should raise its interest rates to curb the Canadian dollar's downward slide against other world currencies.
"Hopefully Canada will come to its senses and raise rates," he said.
U.S. investors, meanwhile, should turn to the commodities market, precious metals such as gold and silver, and currencies and bonds from other nations to gird their own portfolios, he said.
With files from Associated Press

Tuesday, 19 July 2011

House Approves 'Cut, Cap and Balance' Plan

House Approves 'Cut, Cap and Balance' Plan

Published July 19, 2011
| FoxNews.com
The House of Representatives has approved the GOP's 'Cut, Cap and Balance' plan with a vote of 234 to 190.
The bill imposes caps on federal spending as a percentage of GDP. It also allows for an increase in the debt ceiling by $2.4 trillion in exchange for both the Senate and House approving a balanced budget amendment.
House Speaker John Boehner  played a muted role in public during the day, but later applauded the passage of the plan.
“House Republicans are the only ones to put forward and pass a real plan that will create a better environment for private-sector job growth by stopping Washington from spending money it doesn’t have and preventing tax hikes on families and small businesses," he said in a statement. "The White House hasn’t said what it will cut."
But nine Republicans voted no on the plan, including Rep. Michele Bachmann, R-Minn. and Rep. Ron Paul, R-Texas. Five Democrats sided with Republicans.
“I have never voted to raise the federal debt limit, and I have no doubt that we face financial collapse and ruin if we continue to grow our debt," Paul said in a statement. "We need to make major spending cuts now, in this budget, and we can no longer afford to allow more deficit spending based on promises of future cuts."
The plan is under a veto threat by Obama amid predictions that it won't make it through the Senate.
Meanwhile, President Obama on Tuesday urged lawmakers to pick a "clear direction" within the next couple days on how to raise the debt ceiling and cut deficits, praising a bipartisan group of senators for putting a renewed budget plan on the table while criticizing House Republicans for pushing a separate proposal he said will not pass. 
"We don't have any more time to engage in symbolic gestures. We don't have any more time to posture," Obama said.  
According to the White House, Obama plans to once again summon congressional leaders for a meeting on the way forward. Speaking to reporters briefly Tuesday afternoon, the president warned that lawmakers are now "in the eleventh hour" and need to start "talking turkey" about crafting actual legislation that has a chance at passing. 
He seemed to urge lawmakers to use the so-called "Gang of Six" plan as a new starting point for a "broader agreement," claiming it overlapped with his general goals for a deficit-reduction deal. 
That plan seeks to extract nearly $4 trillion in deficit reduction over the next decade through a combination of tax increases and spending cuts. A group of 50 senators gathered Tuesday for more than an hour to hear from the reunited so-called "Gang of Six" -- a group of three Republicans and three Democrats which led discussions before breaking apart in the spring. 
Their deficit-reduction plan has already won the support of the Senate's No. 3 Republican, Sen. Lamar Alexander of Tennessee, and cautious optimism from one of the Obama administration's toughest critics, Sen. Tom Coburn, R-Okla.
Senate Democratic Leader Harry Reid called the balanced-budget proposal "the stupidest constitutional amendment I've ever seen." 
Republicans fiercely defend the cut, cap and balance proposal, noting that they've done more than Obama in putting a plan on the table. 
"The president continues to say that he wants to do big things. We do as well. We put forward our big plan and vision in our budget," House Republican Leader Eric Cantor said. "But we implore the president -- let's do big things, let's go ahead and get our fiscal house in order. But let's do so without imposing higher taxes on the small business people that we need so desperately to start hiring again." 
Fox News' Chad Pergram contributed to this report.


Read more: http://www.foxnews.com/politics/2011/07/19/house-approves-cut-cap-and-balance-plan/#ixzz1ScCYEQES