Budget 2.0

Early yesterday morning, the US House of Representatives, under the leadership of new Speaker of the House John Boehner, passed a FY2011 budget that cut approximately $61 billion in federal spending. Democrats across the government decried this budget as “draconian” stating that the cuts would negatively impact the US economy and its citizens. Why are we even having this debate?

Last year, Democrats in both the House and Senate refused to even propose a budget for FY 2011. Why? Because they were afraid of the political impact in last years elections should they proposed a budget that either cut certain discretionary spending that the public opposed or a budget that kept on spending money that the government doesn’t have. Realizing the huge political implications in an election year where the American public were angry at the way the Washington, DC continually operates, Democrats realized that their position related to the budget and the US debt were causing a huge surge towards the Republican party and away from the Democrats. Independents, Republicans and Democrats across the country were angry that unlike everyone else, the US government decided that it didn’t need to limit spending in an economic downturn and instead dramatically increased spending by nearly 25% since FY 2008. No business or family could afford to increase spending at such a rate when revenues decrease.

So instead of doing their job last year and at least proposing a budget, the Democrats decided to do nothing and just implement a continuing resolution that maintained spending at FY 2010 levels. Fearful of the political implications of actually doing their jobs, Democrats decided to just maintain spending at FY 2010 levels. That certainly isn’t leadership. That certainly isn’t doing the job that they were elected to do. And they wonder why they were thrown out of office at such a large rate last November and why they could be in for more losses in next year’s election should they once again refuse to seriously address the fiscal problems facing America.

Another result of the budget crisis/debate going on in DC is the impact it has on state and local budgets. Two years ago, with the passage of the “stimulus bill”, many states put off making the necessary tough decisions to remodel their state budgets. They used stimulus money to offset budget deficits that many were required to balance. Now that there is no additional stimulus money coming into the states, many are faced with severe budget deficits. Much has been made regarding Wisconsin’s proposal to ensure that state government employees start contributing to their own pensions and to pay a small portion of their health benefits. Schools across the state were closed Thursday and Friday when teachers called in “sick” in order to protest in Madison against these reasonable proposals that almost everyone outside of government employees already pays into, usually at a much higher rate. Teachers, who typically cry out that their job is to help develop the children of our country, decided that the best way to teach our children is to walk off their job to protest having to do what everyone else does. Governor Scott Walker told the residents of Wisconsin during the campaign that he would propose these agenda items and would fight certain collective bargaining rights of state workers. All the Wisconsin plan entailed was eliminating collective bargaining with respect to pay, not benefits and to have elections every year to make sure that the employees still want to have unions represent them. As President Obama stated two years ago in one of his few meetings with Republican leaders, “elections have consequences.” Republicans won across the country, except possibly in California, and have committed to reigning in spending and it seems that the Democrats are too afraid, or just hoping to use this issue as a political tool to try and minimize their losses in future elections.

Not a serious proposal

President Obama released his FY2012 budget earlier this week. The Administration proclaimed that they were being fiscally responsible by projecting that their budget would reduce the deficit by $1.1 trillion over the next ten years. This projection makes a number of assumptions. First, it expects that the US economy will grow faster than any reasonable economist has projected. The budget also includes reductions in spending based upon cuts that were already budgeted for with respect to spending in the war on terror. It assumes budget cuts based upon a higher current spending level then includes cuts that were already assumed to provide a majority of the $1.1 trillion cuts. What the budget also projects is a deficit for FY 2012 of $1.3 trillion.

The budget proposal submitted by the Obama Administration is not a serious proposal. Media organizations across the country have stated everything from the Administration “punting” on a serious budget to “not being serious.” The major causes of the federal deficit are entitlement programs: Social Security, Medicare and Medicaid. The Obama Administration did not even attempt to look at any ideas to reduce the costs associated with any of these problems. House Republicans currently are debating the FY2011 budget that the Democrats refused to even start working on before last years election. The current proposal includes nearly $61 billion in budget cuts for the budget that ends at the end of September. While the Senate is unlikely to approve the House bill, and the President has stated that he would veto the bill, at least the House is trying to be realistic with respect to the budget. In households and in every business across the country, budgets are determined on projections of anticipated revenues and expenditures. If the expected revenues decline, reductions in spending must be implemented so that the budget remains balanced. The House seems to realize that expanding the federal deficit is a recipe for disaster and reductions in spending must be made today in order to survive tomorrow. As the House starts to prepare their FY2012 budget, they have stated that entitlements will be addressed. The Administration seems to be more interested in politics and blaming the Republicans for proposed “cuts” that will hurt Americans. Instead of having the “adult conversation” about the budget, the Administration and the Democrats are going back to the only thing they seem to know, make it a political argument and blame the Republicans for eliminating police and emergency responders, teachers and so forth and of course, hurting our seniors with the potential changes to our entitlement programs. Typical Democrats and not a good situation, neither short term or long term, for America. You know it is a strange situation when ever the liberal main stream media is calling out the Democrats and Administration for not being serious about the budget situation.

The lack of US intelligence

Yesterday was a tough day for American Intelligence agencies. At an open hearing before the House Intelligence Committee, two rather strange statements were provided by CIA head Leon Panetta and Director of National Intelligence James Clapper. Director Panetta stated that he anticipated that Egypt’s President, Hosni Mubarack would resign his position by the end of the day. DNI Clapper stated that the Muslim Brotherhood was “largely secular” and has “eschewed violence.” Both of these statements seem to defy logic and bring into question how reliable our intelligence services are. While Panetta was only a day off, it still shows how important having credible and reliable intelligence is to the operation of the US government. Both of these statements provided our allies and enemies across the world a rare glimpse into exactly how bad our intelligence situation is. Our government relies on the intelligence briefings it receives. These briefings help our government make its decisions. With faulty, mistaken, or flat out wrong intelligence, the actions of our government are severely hindered.

The residents of Egypt were able to finally get what they have been protesting for the past eighteen days for, a removal of the reign of 30 year leader/dictator Hosni Mubarack. This change in power can lead to a lot of uncertainty in the Middle East. What type of government is going to take hold in Egypt? For now, the military is taking over. Is that same military going to still be an ally of the US? While they get $1.3 billion in US aid each year, no one knows for certain what the future holds for Egypt and our relationship with its new government. While the will of the people seem to have taken hold, one can only hope that the new government in Egypt provides a model for other countries in the region by providing a democracy for its citizens. Maybe this change in government in Egypt will provoke a change in government in countries like Iran. However, we are unlikely to be able to rely on our intelligence services to provide adequate predictions for when or if such a change would happen.

Happy Birthday Mr. President

One hundred years ago today, Ronald Reagan, a historic figure, was born. Today across multiple media sources you will likely see columns written describing the former President and his role and impact in the course of the United States.

Recently, even Time magazine included President Reagan on its cover, including him with his arm around current President Obama with the headline, “Why Obama loves Reagan.” This cover along with multiple political pundits who in the aftermath of the recent State of the Union address, proclaimed how Obama is today’s generation Reagan. Reagan was proclaimed the “Great Communicator” and President Obama has also drawn comparisons to the former President’s ability to connect with the American public. His oratory skills likely helped him become President.

I am one who completely disagrees with the assessment that Obama is today’s Reagan.
While the two politicians represent different political parties and therefore have a different set of beliefs on the role of government. That isn’t the only big difference between the two. President Reagan was the eternal optimist, proudly proclaiming that America is that “shining city on a hill.” His campaigns brought a new group of voters into the American public, “Reagan Democrats.” These voters, personified by the voters in suburban Detroit, were working class individuals who cared deeply about America but were worried about the direction of the country, both economically and globally, under the leadership of President Carter. These voters are still the most sought after voters today, the classic independent voters that win national elections.

While President Obama’s 2008 campaign for President brought him a large number of independents into the Democratic side, most of those independents now have a negative impression of him. President Obama also seems to have a negative impression of America and its role in the world and global economy. All to often it seems as if he is embarrassed about the role of America and seems to always apologize for America being the world leader. He doesn’t see America as the shining city on the hill but rather as the shining example of how a country has fallen due to the advancements of some of its citizens and businesses at the expense of the overall collective. He doesn’t exude the sense of optimism that Reagan always seemed to do.

The belief that Obama is today’s Reagan is completely off the mark. While it is true that Obama has the ability to really connect with the American public through his communication, he has not embraced the positive, hopeful, optimistic message that Reagan stood for. America will celebrate President Reagan today and for a long time as those of us who grew up under his leadership and long for a return to the policy agenda that he promoted. Today it is way too early to even think about comparing President Obama to the legend of the Gipper. He can only pray that in two years, the American public provide him the opportunity to continue to serve the American public as its President.