Thursday, July 28, 2011

Speaker Boehner Selling us Out Again!

John Boehner is selling us out again. He sold us out on the CR when the cuts turned out to be minuscule, and he is selling us out now with this new plan.

Imagine going to your banker and trying to borrow $24,000 with a monthly income of $2,000, expenses of $3,000 and total indebtedness of $150,000. Tell your banker you are going to spend $81.00 less per month next year and that should make you solvent. That is the loan application we have been given by Speaker Boehner and his conspirators in the Senate!

No loan officer in the country would approve that loan, and if it was found out he did, he would go to jail! We, as a country do not deserve an AAA credit rating, and this bill will do nothing to convince anyone that we do.

Why are the decepticons in congress working so hard to pass such a bad bill? Cut, Cap & Balance already passed the house. The Senate has not passed anything! Adjourn the House and let the Senate pass something. Without real spending cuts and a balanced budget amendment, there is no hope of ever getting our federal budget under control, and we will all be sold down the river!

Tuesday, July 26, 2011

Where Does the Buck Stop?

Last night we heard the President of the United States once again take to the microphone and lecture us about the debt crisis. While I listened very carefully to what he said, I was saddened. It was little different from many speeches he has given recently with no plan, no new information, and very little truth.

There was a time in America when we were proud of the leader of our country. There was a time when, rightly or wrongly, we trusted what he said. There was a time when we could tell our children to be inspired by his words, to look up to him and aspire to the quality of his character.

It is no longer that time. Our country has a serious problem. We are spending our children into indentured servitude, slavery as it were. We are digging for them a hole from which they will find it impossible to extract themselves. Everyone knows this, it is self-evident.

A man with integrity, with strength of character, a man of leadership, would take bold action. He would acknowledge the elephant in the room and recognize that when one finds one's self at the bottom of a deep hole, the wise course is to stop digging.

What did we hear from our President last night? First of all, blame Bush. Nothing new here. Second, scare people. He once again threatened senior citizens by offering to withhold their Social Security checks. The problem is that threat is an outright lie, and designed only to maintain a hold on his power, and to urge us to let him make the hole deeper with a backhoe, rather than a shovel. How am I to teach my daughter the value of honesty when the President of the United States knows very well that he cannot stop the Social Security payments, even if he wanted to. There are 2.6 trillion dollars of treasury notes in the Social Security trust fund. Those treasury notes are already there, and are not affected by the debt ceiling. Mr. Obama knows that they can be negotiated in order to pay our seniors, and that the law requires him to do so.

He threatens default on our debt, when he also knows full well that there is more than enough money coming into the treasury on a monthly basis to service our debt, pay our soldiers, and cover our most pressing obligations.

There is no integrity in this man. He is concerned with his own political future, period. How can I point to the Office of the President of The United States, and tell my daughter how great this country is? How can I talk about the principals which made America the most desirable place in the world to live, when we have such a blatant ego-maniacal liar for our leader?

He has offered no plan. He has obstructed every sensible plan offered. He has stood squarely in front of every effort of business to grow our economy, from denying permits for oil and coal exploration, to blocking manufacturing plant expansion, to taxing tanning salons out of business.

So we should hand him a larger shovel, a mechanized shovel with which to bury us and our posterity? Should we allow this man to heap further debt upon the heads of our children while continuing to limit their opportunities for the future? Should we sell our children into never ending servitude to a government whose leader cannot muster up the intellectual honesty to admit he might be wrong about anything?

I say NO! I say not while I still have the ability to speak for the lovely young woman who is my daughter! This is my country. I earned the money the federal leviathan extracts from my pocket every two weeks. It is NOT your money Mr. President. I do NOT agree to make the payments on the debt you wish to incur on behalf of my daughter and me. Many brave souls gave their lives to extract themselves and their descendants from the yoke of Tyranny and if it becomes necessary, many more will. If the buck will not stop with you Mr. President, then I say the buck stops here, with me and mine!

Sunday, July 24, 2011

Shame on You President Obama!

What part of out of money, and live within your means do the Democrats and Barrack Obama not understand. They whine and complain that we need to reach an agreement, when the House of Representatives have already done the job they were sent to Washington to do, Cut, Cap and Balance.

Does Harry Reid REALLY think we the people are that stupid? While Highwayman Harry cries over the possible loss of federal funds for his beloved Cowboy Poetry festival, and Barrack Obama refuses to rescind the 53 Billion Dollars promised to his buddy Jeff Immelt at GE to build High Speed Rail no one will ride, Rome is on fire.

I feel compelled to remind everyone that in 2006 Barrack Obama himself said, "The fact that we are here today to debate raising America’s debt limit is a sign of leadership failure. It is a sign that the U.S. Government can’t pay its own bills. It is a sign that we now depend on ongoing financial assistance from foreign countries to finance our Government’s reckless fiscal policies. … Increasing America’s debt weakens us domestically and internationally. Leadership means that ‘the buck stops here. Instead, Washington is shifting the burden of bad choices today onto the backs of our children and grandchildren. America has a debt problem and a failure of leadership. Americans deserve better."

You are right Mr. President, we do deserve better, and the lack of leadership is squarely in your corner. The GOP in the House have done their job, you just don't like it. You and Highwayman Harry would much rather enslave our children under a mountain of unspeakable debt than swallow a little pride, admit your policies haven't worked, and accept a deal to pull our beloved nation back from the brink of disaster.

Shame on you Mr. President. Shame on you Mr Reid. We know. We the American public, know that like Nero, you are fiddling while the Nation burns. We know you would prefer to burden our children and grandchildren with the yoke of bondage to the Federal Leviathan for generations to come, you would gladly hand our country over to our advisories than act responsibly. You do not fool us.

When the country crumbles under the weight of your massive increases in spending over the last two and a half years, we WILL hold you responsible. We know it is only your ego and childish insistence on having your own way for political reasons which will lead the country to ruin.

Shame on you Mr. Obama, Shame on your house!

Friday, July 22, 2011

Gang of Six Hustled by Democrats!

I listened very carefully to Sean Hannity's interview of Saxby Chambliss on Thursday, and I am convinced that the so called Gangland of Six were set up by the Democrats and Barrack Obama.

Senator Chambliss maintained that the gang had been meeting for about a year to come up with a deficit reduction package. He insisted that they never had any intention of competing with Cut, Cap and Balance and were not that close to an agreement. He seemed genuinely shocked that people were upset with the gang for their work, or their final work product. One thing he said, that Hannity seemed to miss because Sean was so angry, was that on Tuesday, the day of the House vote on Cut, Cap and Balance, the three Democratic members of the gang suddenly capitulated to what was at the time, the Republican position!

Senator Chambliss seemed genuinely surprised that the Democrats suddenly dropped the rest of their objections to the current negotiations and moved to the Republican position. Happy with their sudden victory after a year of negotiations, Mr. Chambliss, and I suppose the other two Republicans on the committee, never gave a thought to the timing of the agreement. Happy to have reached a deal after so long, they went about their business without a care.

At that moment, our Liar in Chief must have gotten the phone call he was waiting for, knowing it was coming because he orchestrated the deception. He must have told the Mafia of Three to move to the Republican position so he could run out and interrupt Jay Carney's news conference. Obama made his “stop the presses” announcement, thereby undermining the House's vote on Cut, Cap and Balance.

In terms of public policy, there is no question that Obama is incompetent, unless he IS actually trying to destroy this country and everything it stands for, but politically he is every bit as slippery as Bill Clinton was! Do not take this man for granted my fellow patriots. If he is to be defeated it will require great skill!

Wednesday, July 20, 2011

President & US Senate Support Slavery of our Children!

That may sound like a provocative headline, and it is, but it is also the truth! Our current debt is $14.519 Trillion. That means my 12 year old daughter's share of that is currently $46,564.00. Add in the current unfunded liabilities of $114,751,918,000,000.00 and her share of the national debt plus unfunded liabilities for Social Security, Medicaid and Medicare is $414,583.72 or $1862.00 per month every month for THIRTY years. On top of that the US Senate and President Obama want to add an additional 2.4 Trillion dollars which, under the McConnell plan, have no spending cuts associated with it, and under the Gang (appropriate name for what they are trying to do) of Six plan nobody knows.

Assuming we stopped borrowing right now, and my daughter could get a job right out of high school making $40,000.00 per year, she would already owe her entire take home salary to the government. She did not vote for these debts. She did nothing to create them, yet there she is at twelve years old owing the Slave Owners in Washington nearly a half-million dollars. You owe that much too!

We are all rapidly becoming enduntured servants of the leviathan we call our government. It has long ago ceased to be a governemnt of the people, for the people and by the people. It has become instead a government of the career politician, for the career politician and his friends, and by the lobbyist and government dole recipient. Unfortunately soon there will be no producers left to feed the insatiable appetite of the gluttonous belly of the political beast in Washington DC.

So yes, the President and the US Senate, by refusing to support the cut, cap and balance plan which passed the House of Representatives last night, and offers a real chance to start to get a handle on our spending problem, are de-facto showing themselves to be in favor of enslaving our children and grandchildren now and long into the future.

It is time to stop the practice of making slaves out of ourselves and our children. It is time to stop NOW. We are the governors of this country, not the lazy, cowardly career politicians in DC. Let them know. Let them know that if they do not free your children from the yoke of bondage now, they will be sent home to labor under that very same yoke themselves. It is YOUR country, YOU can make a difference. You have until Saturday, and then it too late.

Tuesday, July 19, 2011

Stop the Senate from Handing a Blank Check to Obama!

Well, folks, I am sorry to report that the fix is in. The Senate, in back room dealing, appears to be prepared to hand President Obama a blank check to spend our children's as of yet unearned money any way he pleases, to the tune of an additional 2.5 TRILLION dollars.

I listened to John McCain yesterday on the Sean Hannity show, and he all but said as much! Mr. Hannity was asking repeatedly about cut, cap and balance, and McCain said he was going to fight for it, but then consistently argued for the McConnell plan. He barley gave lip service to cut, cap and balance, and got angry when Hannity pressed him about the McConnell plan. McCain said it was a last resort, but then continued over and over again to argue it's merits. Heaven help us!

In making my calls to Senate offices yesterday afternoon, my impression did not change. Republican staffers with whom I spoke, seemed to be hedging when I brought up the McConnell plan and my opposition to it. The Democrats staffers just gave me the “yeah, yeah I'll pass your message on” routine.

McCain told Hannity that his office had been flooded with calls from seniors who were frightened by the Obamascare campaign. The fact that the Administration could not stop social security checks from going out, even if they wanted to, because of the way the Social Security Administration's computers are programed, didn't get in McCain's way. Our only course has to be action!

If these Senators' offices are overwhelmed with calls from concerned citizens like you and me, we might have a slim chance of beginning to free our children from the slavery and tyranny being foisted upon them by our so-called representatives.

Given the fact that ICE is busily shutting down blogs and seizing domain names, I don't know how long we will have the opportunity to speak in opposition to this Administration's ongoing power grab and usurpation of the rights with which we were endowed by our creator!

I urge anyone who is interested in freedom, in life, liberty, and the pursuit of happiness to call as many Senators as possible and voice strong opposition to Senator McConnell's plan to hand over a blank check to the President, so he can spend as many of our children's hard earned dollars as he chooses! Do it today! Do it now! Time is running out for our beloved nation!

Akaka, Daniel K. - (D - HI)
(202) 224-6361
Web Form:

Alexander, Lamar - (R - TN)
(202) 224-4944
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Ayotte, Kelly - (R - NH)
(202) 224-3324
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Barrasso, John - (R - WY)
(202) 224-6441
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Baucus, Max - (D - MT)
(202) 224-2651
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Begich, Mark - (D - AK)
(202) 224-3004
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Bennet, Michael F. - (D - CO)
(202) 224-5852
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Bingaman, Jeff - (D - NM)
(202) 224-5521
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Blumenthal, Richard - (D - CT)
(202) 224-2823
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Blunt, Roy - (R - MO)
(202) 224-5721
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Boozman, John - (R - AR)
(202) 224-4843
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Boxer, Barbara - (D - CA)
(202) 224-3553
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Brown, Scott P. - (R - MA)
(202) 224-4543
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Brown, Sherrod - (D - OH)
(202) 224-2315
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Burr, Richard - (R - NC)
(202) 224-3154
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Cantwell, Maria - (D - WA)
(202) 224-3441
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Cardin, Benjamin L. - (D - MD)
(202) 224-4524
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Carper, Thomas R. - (D - DE)
(202) 224-2441
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Casey, Robert P., Jr. - (D - PA)
(202) 224-6324
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Chambliss, Saxby - (R - GA)
(202) 224-3521
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Coats, Daniel - (R - IN)
(202) 224-5623
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Coburn, Tom - (R - OK)
(202) 224-5754
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Cochran, Thad - (R - MS)
(202) 224-5054
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Collins, Susan M. - (R - ME)
(202) 224-2523
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Conrad, Kent - (D - ND)
(202) 224-2043
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Coons, Christopher A. - (D - DE)
(202) 224-5042
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Corker, Bob - (R - TN)
(202) 224-3344
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Cornyn, John - (R - TX)
(202) 224-2934
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Crapo, Mike - (R - ID)
(202) 224-6142
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DeMint, Jim - (R - SC)
(202) 224-6121
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Durbin, Richard J. - (D - IL)
(202) 224-2152
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Enzi, Michael B. - (R - WY)
(202) 224-3424
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Feinstein, Dianne - (D - CA)
(202) 224-3841
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Franken, Al - (D - MN)
(202) 224-5641
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Gillibrand, Kirsten E. - (D - NY)
(202) 224-4451
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Graham, Lindsey - (R - SC)
(202) 224-5972
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Grassley, Chuck - (R - IA)
(202) 224-3744
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Hagan, Kay R. - (D - NC)
(202) 224-6342
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Harkin, Tom - (D - IA)
(202) 224-3254
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Hatch, Orrin G. - (R - UT)
(202) 224-5251
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Heller, Dean - (R - NV)
(202) 224-6244
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Hoeven, John - (R - ND)
(202) 224-2551
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Hutchison, Kay Bailey - (R - TX)
(202) 224-5922
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Inhofe, James M. - (R - OK)
(202) 224-4721
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Inouye, Daniel K. - (D - HI)
(202) 224-3934
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Isakson, Johnny - (R - GA)
(202) 224-3643
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Johanns, Mike - (R - NE)
(202) 224-4224
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Johnson, Ron - (R - WI)
(202) 224-5323
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Johnson, Tim - (D - SD)
(202) 224-5842
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Kerry, John F. - (D - MA)
(202) 224-2742
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Kirk, Mark - (R - IL)
(202) 224-2854
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Klobuchar, Amy - (D - MN)
(202) 224-3244
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Kohl, Herb - (D - WI)
(202) 224-5653
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Kyl, Jon - (R - AZ)
(202) 224-4521
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Landrieu, Mary L. - (D - LA)
(202) 224-5824
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Lautenberg, Frank R. - (D - NJ)
(202) 224-3224
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Leahy, Patrick J. - (D - VT)
(202) 224-4242
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Lee, Mike - (R - UT)
(202) 224-5444
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Levin, Carl - (D - MI)
(202) 224-6221
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Lieberman, Joseph I. - (ID - CT)
(202) 224-4041
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Lugar, Richard G. - (R - IN)
(202) 224-4814
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Manchin, Joe, III - (D - WV)
(202) 224-3954
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McCain, John - (R - AZ)
(202) 224-2235
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McCaskill, Claire - (D - MO)
(202) 224-6154
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McConnell, Mitch - (R - KY)
(202) 224-2541
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Menendez, Robert - (D - NJ)
(202) 224-4744
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Merkley, Jeff - (D - OR)
(202) 224-3753
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Mikulski, Barbara A. - (D - MD)
(202) 224-4654
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Moran, Jerry - (R - KS)
(202) 224-6521
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Murkowski, Lisa - (R - AK)
(202) 224-6665
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Murray, Patty - (D - WA)
(202) 224-2621
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Nelson, Ben - (D - NE)
(202) 224-6551
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Nelson, Bill - (D - FL)
(202) 224-5274
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Paul, Rand - (R - KY)
(202) 224-4343
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Portman, Rob - (R - OH)
(202) 224-3353
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Pryor, Mark L. - (D - AR)
(202) 224-2353
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Reed, Jack - (D - RI)
(202) 224-4642
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Reid, Harry - (D - NV)
(202) 224-3542
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Risch, James E. - (R - ID)
(202) 224-2752
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Roberts, Pat - (R - KS)
(202) 224-4774
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Rockefeller, John D., IV - (D - WV)
(202) 224-6472
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Rubio, Marco - (R - FL)
(202) 224-3041
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Sanders, Bernard - (I - VT)
(202) 224-5141
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Schumer, Charles E. - (D - NY)
(202) 224-6542
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Sessions, Jeff - (R - AL)
(202) 224-4124
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Shaheen, Jeanne - (D - NH)
(202) 224-2841
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Shelby, Richard C. - (R - AL)
(202) 224-5744
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Snowe, Olympia J. - (R - ME)
(202) 224-5344
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Stabenow, Debbie - (D - MI)
(202) 224-4822
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Tester, Jon - (D - MT)
(202) 224-2644
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Thune, John - (R - SD)
(202) 224-2321
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Toomey, Patrick J. - (R - PA)
(202) 224-4254
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Udall, Mark - (D - CO)
(202) 224-5941
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Udall, Tom - (D - NM)
(202) 224-6621
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Vitter, David - (R - LA)
(202) 224-4623
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Warner, Mark R. - (D - VA)
(202) 224-2023
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Webb, Jim - (D - VA)
(202) 224-4024
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Whitehouse, Sheldon - (D - RI)
(202) 224-2921
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Wicker, Roger F. - (R - MS)
(202) 224-6253
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Wyden, Ron - (D - OR)
(202) 224-5244
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Saturday, July 16, 2011

Patrick Henry Revisited

On March 22, 1765 the British Parliament passed a law they will forever regret. It required the colonies in America to purchase paper for all legal documents from England, thereby subjecting them to a tax. This tax extended even to playing cards.

It was not the amount of the tax to which some independent minded colonists objected, but the principal of the tax and its precedent. For the first time, a tax was imposed on the colonists to raise revenue rather than to regulate commerce. This law was the catalyst that eventually led to the American Revolution.

Let us give that some thought in the light of our current situation. The crux of the problem was that the tax was passed over the objection of the people upon whom it was imposed. They had no representation in the British parliament, and when they passed some resolutions in the Virginia legislature which opposed the new tax, the British governor of Virginia disbanded the House of Burgesses (the Virginia Legislature).

It has been said that "he who forgets is doomed to repeat". Our current debt limit crisis is one made of a similar situation. While in theory, we have representation in the body that is itching to again raise taxes, the states house, the US Senate, our representatives there seem prepared to completely ignore the wishes of the majority of the people they presume to represent. In fact, they seem willing to abdicate their responsibility all together, and hand a blank check over to our Spender in Chief in the White House. An act of this horrendous irresponsibility would be akin to King George and his minions disbanding the Virginia House of Burgesses!

The tyranny, however, is more subtle in our situation. The taxes to be imposed, verily already imposed, are taxes upon those whom have ABSOLUTELY no representation to protect themselves from the slavery being foisted upon them, save the representation WE can provide. They have yet to be born, or reach the age of consent. They are our children and grandchildren.

Set aside for a moment, the legislation and regulation which has already been shoved down our collective throats by either last minute, back room negotiations and maneuvering, as is the case with Obamacare, or the mountains of regulation we are forced to abide by without our consent; imposed on us be Executive Edict, or edict of his Czars. Let us turn our attention to the fact that our children and grandchildren already face a mountain of debt they did not create, nor vote for, and whose obligations will extract an ever larger and larger share of the fruits of their labor. If this is not the definition of Tyranny, I don't know what is. We are in effect selling our children into slavery. And for what? So our Dictator in Chief, and his agreeable bobble heads in the Senate can enrich their friends and supporters, and try to cement themselves in the seats of power which insures the slavery will continue? Hundreds of billions to Jeff Immelt at GE, Hundreds of millions to the Labor Unions, and millions and millions more to the lapdog media!

What is the President's response. Blatant outright lies and fantasies that 80% of the public agrees with him, and that he has no responsibility to end the tyranny. I, for one, must agree with Patrick Henry, "I know not what course others may take, but as for me, and my children, give us Liberty....Or give us death!"

Thursday, July 14, 2011

Fixing the Deficit All by Myself

In the current debt ceiling and deficit talks, one of the major things missing is talk about growth. If Mr. Obama is so intent on raising revenue, he could do it all by himself. Taxing oil companies seems to be high on his priority list. All he has to do to generate more revenue from both oil and coal producers is to let them produce!

According to Fineberg Research in 2006, the Federal Government collects about $0.47 for every barrel of oil produced in the US. With approximately two trillion barrels of oil proven, but untapped oil, that represents almost a trillion dollars of untapped revenue. The oil isn't being produced due largely to regulation from the EPA and the Obama administration. In addition to the direct revenue from the “evil” oil companies, this untapped reserve also represents thousands and thousands of jobs. These jobs are not just directly in the oil fields, but would be created by supporting the new oil field hires. They all would have more money to spend on consumer items, a boon for the local economies where the oil is located, and a boon for the unemployment rate.

I'm going to lose points with this one, I know, but here goes. The National Marijuana market is estimated to be about 100 Billion dollars per year. It is rather silly to argue about the health risks of Marijuana, when alcohol is perfectly legal and is the third leading cause of lifestyle related deaths behind tobacco and obesity. The revenue derived from legalizing it would be significant, not enough to solve the deficit problem, but again it would create thousands of jobs, and people who work pay taxes. Farmers, farm machinery manufacturers, and merchants would all benefit from its legalization.

Get the NLRB and other regulators to back off. Boeing is trying to create thousands of high-paying jobs in manufacturing, but Obama's NLRB is stopping them. This is a real shame, especially since aircraft are one of our major exports.

Repeal Obamacare and save $1.2 trillion instantly! In addition to the instant savings, this one measure alone would release trillions of dollars in pent up capital. Business would feel more confident about expanding their operations, and entrepreneurs would feel more confident about going into business. The tanning tax alone has already cost 24,000 jobs and closed 3100 small businesses.

Growing GDP by just 5% per year would add $100 billion to the revenue stream, and an unemployment rate of 6% would more than double that!

Yes, Medicare, Medicaid and Social Security need to be addressed, soon, and with common sense. But there are solutions to our deficit problems which should be implemented with all due haste, and none of them have to do with changing the depreciation rate on private jets!

An Open Letter to the President

Dear Mr. Obama,

With all due respect to the Office of President of the United States, you sir, are a liar. Every time I hear you speak, your words are filled with half-truths, demagoguery, and outright lies.

I believe you are aware of this, but my fear is that you may actually believe the things you say. When I heard about you saying yesterday not to “call your bluff” before storming out of the budget meeting like a child, it indicated to me that you ARE aware of your falsehoods.

This is my country sir. I believe in government of the people, for the people and by the people. It is increasingly obvious that you believe in government of Barrack Obama, for the friends of Barrack Obama, and by executive order. If you had any respect or love for the principals our great nation was founded upon, and any personal integrity, you would offer your resignation immediately, for the good of our country.

As your employer, along with 320 million others, I am asking for that resignation. At a time when we are in peril as great as we are, we need compitent leadership. Unfortunately, you have shown, during the entire term of your presidency, neither competence nor leadership. It makes me sad.

Monday, July 11, 2011

Dirty Little Secret About the Budget

The US Government cannot pay it's bills. The credit card is maxed out. The Administration, Wall Street, and many of the Democrats in the House and Senate are begging for a credit limit increase on our collective Visa card known as the debt ceiling.
The Republican party, particularly the Tea Party wing, are insisting on very real budget cuts without tax increases, before they will consider any debt limit increase. In addition, they are demanding an amendment to the Constitution that requires a balanced budget. Why this insistence on cuts and other measures to be sure of lower spending prior to allowing the government to borrow more money? Because the one thing Congress, and especially this Administration, never does is spend less money. The Democrats are telling everyone that the must have tax increases on the “Rich” in addition to spending cuts to begin to bring our budget into balance. The “millionaires and billionaires” must pay their fair share and share some sacrifice they tell us. There are several problems with this statement, however. First of all, they are not really talking about millionaires and billionaires. There isn't enough money there. What they are talking about is wage earners who make over $200,000 per year filing separately, or $250,000 if filing jointly. According to the IRS, in 2008 3.4 million taxpayers reported adjusted gross incomes between $200,000.00 and $500,000.00.

According to the IRS, in 1992, the top 20% of wage earners paid 65% of the income tax. In 2001, when the top rate was 39.5% the top 10% of wage earners paid 64% of the income tax, and in 2008 when the top rate was 35%, the top 10% of wage earners paid 70% of the tax. The threshold for this 10% is an adjusted gross income of $113,799.00 per year. That is not what I would call excessively rich. The interesting thing about this is that the bottom 50% pay 3% of the tax, meaning that the other 40% of taxpayers with adjusted gross income between $33,048.00 and $113,798.00 pay 27% of the total income tax collected by the IRS. The percentage of tax paid by the bottom 50% has been steadily DECREASING since 2001. Federal Revenues have fluctuated from 2.0 trillion to 2.56 trillion in the years 2005 through 2010, peaking at 2.56 trillion in 2007, and dropping to 2.16 trillion in 2010. Spending, however, has steadily increased from 2.4 trillion per year in 2005 to 3.8 trillion per year estimated in 2011. The question we REALLY need to be asking, is where has that extra TRILLION dollars per year since 2008 gone?

The dirty little secret is this, in 2008 we were told that we had to pass a temporary stimulus package of nearly a trillion dollars to keep the unemployment rate below 8%. The money, we were told, would be spent on “shovel ready” projects which would put people back to work. Since then the unemployment rate peaked at over 10%, dropped down to 8.9% and has now risen back to 9.2%. Real economic growth has stagnated at a meager 1.8%, and our national debt has grown to nearly 15 trillion dollars, or 102% of GDP.

The secret is that this stimulus money isn't temporary. While the democrats claim that they can't cut the budget without throwing grandma out into the street, or starving children with autism or some such other gut wrenching evil, the fact is that 861 billion dollars is simply an increase in spending in several programs over the 2007 levels. (data obtained from the Government Printing Office). The level of spending was too high then. Granted some of the increase is in Medicare, Medicaid, Social Security and Unemployment benefits, and those programs must be addressed, but I don't recall too many stories in the national press about folks starving in the streets in 2007. Government spending equals power in Washington DC, and those folks are loath to give up any power, so the spending, and the borrowing from our children and grandchildren continues unabated.

Tuesday, July 5, 2011

Serious Blog Alert! Our Government's Purse is Full Enough!

Our government does not tax too little, it spends too much.

In response to a “call congress” campaign to voice objection to a debt limit increase without a balanced budget amendment, real significant cuts in spending, and no tax increases, I received several standard “tax the evil rich” responses. In one response, a friend of mine stated that per capita GDP has increased throughout the economic meltdown. While it is true that GDP increased in 2007 and 2008, all be it at a very slow pace, GDP actually dropped in 2009 according to the Bureau of Economic Analysis. That being said, this “tax the rich” philosophy beg the questions how much is enough, and who is it that you consider rich? Leaving aside the fact that if you confiscated the ENTIRE wealth of the fifty richest people in the US (many of whom are democrats by the way i.e. Gates, Buffett, Ellison, Bloomberg, Page, Brin, Soros, Perelman, etc.), you get about 650 billion dollars (figures from Forbes Magazine). That is not even enough to make up half the deficit in this year's budget.

The current top rate for wage earners is 35% which cuts in at $379,150.00 of taxable income. My dear friend states that this is the lowest rates have been since shortly after the great depression. The fact is, however, that in 1992, the top rate was 31%. Be that as it may, let's explore this idea of taxing the rich some more. In 1992, the top 20% of wage earners paid 65% of the income tax. In 2001, when the top rate was 39.5% the top 10% of wage earners paid 64% of the income tax, and in 2008 when the top rate was 35%, the top 10% of wage earners paid 70% of the tax. The threshold for this 10% is an adjusted gross income of $113,799.00 per year. That is not what I would call excessively rich. The interesting thing about this is that the bottom 50% pays 3% of the tax, meaning that the other 40% of taxpayers with adjusted gross income between $33,048.00 and $113,798.00 pay 27% of the total income tax collected by the IRS. The percentage of tax paid by the bottom 50% has been steadily DECREASING since 2001. Federal Revenues have fluctuated from 2.0 trillion to 2.56 trillion from 2005 through 2010, peaking at 2.56 trillion in 2007, and dropping to 2.16 trillion in 2010. Spending, however, has steadily increased from 2.4 trillion/year in 2005 to 3.8 trillion/year estimated in 2011. The question we REALLY need to be asking, is where has that extra TRILLION dollars per year since 2008 gone? In 2009, 2010, and projected for 2011, we have spent an EXTRA trillion dollars more per year that we did in all the years gone before. Even under George Bush, who spent money like a drunken sailor, mostly on war toys, we weren't spending at anywhere close to the rate we are now. Were children starving in 2008? Were old people going without food, clothing and housing in 2008? I don't remember that. I don't remember autistic children starving in the street in 2008, do you?

So where did the money go? 28 billion dollars of it went to GE for high speed rail no one will ride. 0.5 billion for cash for clunkers, 10.6 billion for first time home buyers, 9.2 billion for child tax credits (one reason the bottom 50% pay a smaller share of the tax), 186 billion for grants to states to fund pensions, Medicaid and unemployment, 82 billion to the Department of Education and National Science Foundation (shrimp on treadmills program), 25 Billion to the Department of Energy and the Environmental Protection Agency, the list goes on and on. Of the 2.4 million jobs the administration has claimed to have “saved or created” each job cost $278,000.00 in stimulus money to create or save. That is a fairly expensive way to create and save jobs, which brings me to corporate taxation.

The current corporate tax rate is 35%. When a corporation is creating a budget for coming years, one thing it must take into account is its tax liability. Along with the costs of labor, raw materials, fixed operating costs and the like, they also estimate their tax liability. When a corporation decides how much to charge for its product or service, it must take its tax liability into account. If taxes go up, the price of the good or service goes up accordingly. That means the only thing increasing corporate tax rates, or capital gains rates for that matter, does is pass that tax on to the consumer. When tax rates are unreasonably high in comparison to rates in another state or another country, it provides an incentive for a corporation to move to another state or country. Please take note of the mass exodus of companies from New York, Michigan and California and the gain in Texas. We currently have the second highest corporate tax rate in the world, which explains why GE, our President's favorite corporation, moved much of its operations offshore, and paid NO corporate tax in 2010.

With all that said, it becomes clear that we do not tax too little, we spend too much. The only result we will get from raising top tax rates, is that we will shift an even higher burden on to those carrying 70% of the weight now, and diminish economic activity, pushing corporations overseas, and putting increasing strain on an overwhelmingly thin job market. With 9.1% unemployment, and REAL unemployment (including those who have given up looking) over 15%, the last thing that makes sense from an economic point of view is increase the burden on those who are carrying the bulk of the weight now. Anyone who has a sound background in market economics will say the same thing.

Finally, President Obama attacked private jet owners, saying they should lose the tax break that his administration gave them early in his term. This “break” allows a company to depreciate the cost of an airplane, or improvements to an airplane, over a period of five years instead of seven. For those of you without a background in accounting, depreciation is expensing a purchase over a period of time. If a company leases a car, for example, the monthly lease payment is an expense, and is subtracted from the company's income before tax is calculated on that income. If the company purchased the car instead of leasing it, the price of the car, minus it's expected value after seven years, has to be divided by the number of years (seven in this case) and 1/7th of that value is expensed from each year's income before tax is calculated. The only thing changing the length of depreciation for an airplane does is make the company either less likely to buy or refurbish an airplane, or extend the period of time in between such purchases. The reason the depreciation period was shortened in the first place, was to save airplane manufacturing jobs by encouraging companies to trade their planes in faster. Now we want to slow down the turnover of airplanes and put those jobs in jeopardy?

There is no clearer example of this kind of thinking as when George Herbert Walker Bush went along with the luxury tax in 1990. The reasoning was the same. It went like this; “When people are hurting, and need jobs, why shouldn't the rich pay a little more. They are buying yachts and other luxury items, like diamond rings, and we ought to put an extra tax on those items.” Against his better judgment Bush 41 went along with congress on that one. The actual effect though, as one might guess, is that “rich” people quit buying yachts, or bought them offshore. The net effect was that revenues went down, and 200,000 people who worked in the boat building industry lost their jobs. Ultimately it cost Bush the 1992 election.

If you still think “tax the rich” is a good idea, I would encourage you to read anything by Allan Meltzer, Professor of Economics at CMU, Milton Friedman, Nobel Prize winner in Economic Science and Professor of Economics at the University of Chicago, or Ayn Rand for that matter. Rather than take money from the folks in this country who work hard, create business, and create employment for the rest of us just so we can give it to other folks to see what happens when a shrimp gets some exercise, we ought to stop the excessive spending. We should fix our long term problem of unfunded liabilities for Medicaid, Medicare, and Social Security in a way that protects our seniors, and insures our safety net exists long into the future. That way we can let business get back to work doing what they do best, which is grow our economy!

Monday, July 4, 2011

History Lesson on the Fourth of July - Or So There Joe Biden!

I was appalled last evening to discover the results of a Marist poll taken on July first that found that only 58% of those polled could correctly say that the year of our independence was 1776, and only 76% could say that we became independent from England. The results were far worse for those under 30 years old! This is the kind of edumacation that Joe Biden and the NEA want for our children!

So on this Independence day, I find myself thinking about how this country came to be. I offer a short history of the founding of our nation, which will apparently be better than the one offered by public education these days.

Once upon a time, the earth was flat. This made it extremely dangerous to sail out of sight of land, as one might drop over the edge at any moment, and that could ruin an entire day! A fellow named Columbus, conned the queen of Spain out of some ships and supplies and proved the flat earthers all wrong. In the process he bumped into a new continent that no one, especially the flat earth people, had any idea was out there. The Spaniards believed there was a lot of shinny yellow metal there, and so sent more folks to explore. Word got around, as it often does. In jolly old England, they had a King who didn't like to stay married very long, mostly because none of his wives seemed able to produce a son, so he kept disposing of one wife after another. The Catholic church took a dim view of that, so, not to be restrained, King Henry formed his own church and required all his subjects to belong to the Church of England.

Some miscreants didn't like that very much, and had a desire to worship in a manner that suited them better. The King took exception and sent them packing off to the new land to worship as they pleased, and to find goodies to ship back to England, for the further enrichment the King.

After 150 years or so, these new colonies were thriving, containing some two and a half million people. The King at the time, George his name was, had helped out with some trouble the colonies were having with the Indians and the French. With the war over, he turned his attention to collecting some additional revenue to balance his budget. A lot of revenue. He reasoned that as some in the colonies were getting rich, they ought to spread the wealth around a little, contribute their fair share as it was. He put a tax on tea, which many folks in the colonies didn't like so much. They decided to brew the tea in the Boston Harbor. Next he required the colonists to purchase paper for all legal documents from England. At the same time, he was sending soldiers to the colonies to keep the peace, and requiring citizens to keep the troops in their homes. When colony legislatures objected, he disbanded them, in violation of their founding documents. He bypassed the duly appointed lawmakers and issued edicts about how the colonists were to live (is any of this sounding familiar?)

In 1776, late in the evening of the third of July, following a little skirmish a year previously in Lexington and Concord, the colony legislature's representatives finally came to agreement on the wording of a document declaring their Independence from Great Brittan. This document precipitated a prolonged conflict called The Revolutionary War, the result of which was that the Colonies were free from the tyrannical edicts of the King of England, and were free to govern themselves.

After experimenting with various ways of governing themselves for twenty years or so, including a little disagreement about whiskey and another about water rights, the colonies decided they needed a founding document which would for forever limit their federal government and allow each state to govern itself, except in areas such as arguments between the states, the common defense of the New Nation, and in arranging for trade with other nations. They called this document the Constitution of the United States of America, and it is THE foundation for the federal government's existence. The federal government is supposed to be bound by and constrained by the words in that inspired work. It is what gives our government its right to exist. It laid out a system of checks and balances to ensure that power would never be concentrated in the hands of a few, and it provided for redress of grievances against the government through the judicial branch of that government. If that fails, and the federal government becomes tyrannical, it provides the means, through the second amendment, to dissolve that government.

As the federal government reaches further and further beyond the bounds of Constitution, it heads ever closer to its own Lexington and Concord!

I hope this missive has helped clear up the confusion a bit. In any event, please enjoy your celebration of the Founding of our Great Nation! Happy Fourth everyone.