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US Economy

What’s the Real State of the Union? These Numbers May Tell

From The Blaze:

A day before President Obama delivers his third State of the Union Address, his political opponents are lining up their responses. Speaker John Boehner has already printed a pamphlet to back up his positions.

It is doubtful that the President and the Speaker will see eye to eye on many things. Presented below are some basic statistics about the country. The numbers have been culled from a Washington Times Op-Ed from Joseph Curl

In the area of jobs and unemployment:

  • Unemployment currently sits at 8.5%. When Obama took office, it was 6.8%.
  • There are fewer payroll jobs in America than there were in 2000, and 40% of those are considered to be “low-paying.”
  • Also in decline, the self-employed. In the past six years, two million fewer people consider themselves to be self-employed.

In January, USA Today quoted GOP presidential candidate Newt Gingrich on the unemployment problem since Obama took office:

“Three full years into the Obama presidency, and there are still 1.7 million fewer Americans going to work today than there were on Obama’s Inauguration Day.”

Read the rest at  The Blaze.

President Obama’s Regulatory Bait-and-Switch

From The Heritage Foundation:

The White House on Tuesday announced “final plans” to reduce “unreasonable” regulations that hinder economic growth and job creation.

That President Obama even acknowledges there are costly consequences to government dictates is progress of sorts, and any reduction in red tape is most welcome. But the anticipated savings from the proposed reforms are swamped by the torrent of new regulatory burdens unleashed by this Administration.

Regulatory officials estimate that the proposed changes, if enacted, could save businesses more than $2 billion a year. Many involve streamlining reporting procedures, while others eliminate regulatory overlap or tweak compliance technicalities. Overall, however, the most economically onerous initiatives of this Administration—Obamacare, Dodd–Frank, and the excesses of the Environmental Protection Agency—remain wholly unaffected and thus dwarf any cost savings from the regulatory review.

Since taking office in January 2009, in fact, the Administration has imposed 75 new major regulations, with additional costs exceeding $40 billion annually. Only six deregulatory actions have been taken in that period, resulting in a net increase in regulatory cost of more than $38 billion a year.

No other President has burdened businesses and individuals with a higher number and larger cost of regulations in a comparable period.

Simply put, when it comes to regulation, what little this Administration takes away, it gives back liberally.

Read the rest at The Heritage Foundation.

Want Stimulus? Reduce Regulation

From The Heritage Foundation:

The President has publicly stated his intent to roll out a new expensive stimulus plan this fall.  That plan is expected to contain hundreds of billions in new debt obligations to you, the taxpayer.

Speaker of the House John Boehner (R-OH) has a better idea.  He wrote a letter today to President Obama that identifies an effective means to stimulate growth.  Reduce regulations that are a hidden tax on all Americans and killing private enterprise.  Reducing the regulatory burden on the economy will spur economic growth.

Speaker Boehner writes in a letter to President Obama today that private job creators are reporting that regulatory burdens are hindering new investment and job creation.

Last year, on August 16, 2010, I wrote you about my concern that the Administration’s published regulatory agenda included a total of 191 planned new regulations, each of which had an estimated annual cost of $100 million or more, with some involving billions of dollars annually.  In my letter, I noted that at public forums, private sector job creators were citing this regulatory agenda as one of the primary impediments to job creation, especially for small businesses.

The economy is experiencing low growth and high unemployment.  According to the Department of Commerce (via CNN), the annual growth rate for the economy was 1% in the second quarter of 2011.  This is following a first quarter of 0.4% growth.  The Congressional Budget Office (CBO) has projected an almost $1.3 trillion deficit for next year. Add in the unemployment numbers over 9% for months and you have bleak economic outlook for this and next year.  This is not a good time to increase regulations – especially when the economy is in a need of a stimulating government policy like reducing regulations.

An Amazing Indictment of Obamanomics: Banks that Don’t Want Deposits

From Big Government:

I’ve commented on the failure of Obamanomics, with special focus on how both banks and corporations are sitting on money because the investment climate is so grim. Not exactly flattering to the White House.

Using Minneapolis Federal Reserve data, I’ve compared the current recovery with the expansion of the early 1980s. Once again, not good news for the Obama Administration.

And I’ve shared a couple of cartoons – here and here – that use humor to show the impact of bad public policy.

But here’s a Bloomberg story that provides what may be the most damning evidence that the President’s big government agenda is a failure.

U.S. regulators have asked some banks to take more deposits from large investors even if it’s unprofitable, and lenders in return are seeking relief on insurance premiums and leverage ratios, according to six people with knowledge of the talks. Deposits are flooding into the biggest U.S. banks as customers seek shelter from Europe’s debt crisis and falling stock prices. That forces lenders to raise capital for a growing balance sheet and saddles them with the higher deposit insurance payments. With short-term interest rates so low, it’s hard for financial firms to reinvest the new money profitably. …At least one firm, Bank of New York Mellon Corp., tried to recoup some of the costs by charging depositors 13 basis points, or 0.13 percent, for holding unusually high balances.

Let’s think about what this article is really saying. Banks normally make money by attracting deposits and then lending that money to people and businesses that have productive uses for the funds.

Yet the economy is so weak that banks are leery of taking more money. The story is complicated by other factors, including flight capital from Europe, taxes (or premiums) imposed by the Federal Deposit Insurance Corporation, and various regulatory issues.

Read the rest at Big Government.

Is Obama Really Going to Propose another Keynesian Stimulus?

From Big Government:

Just last week, I made fun of Paul Krugman after he publicly said that a fake threat from invading aliens would be good for the economy since the earth would waste a bunch of money on pointless defense outlays.

Yesterday, there were rumors that Krugman stated that it would have been stimulative if the earthquake had been stronger and done more damage, but he exposed this as a prank (though it is understandable that many people – including me, I’m embarrassed to admit – initially assumed it was true since he did write that the 9-11 terrorist attacks boosted growth).

But while Krugman is owed an apology by whoever pulled that stunt, the real problem is that President Obama and his advisers actually take Keynesian alchemy seriously.

And since President Obama is promising to unveil another “jobs plan” after his vacation, that almost certainly means more faux stimulus.

We don’t know what will be in this new package, but there are rumors of an infrastructure bank, which doubtlessly would be a subsidy for state and local governments. The only thing “shovel ready” about this proposal is that tax dollars will be shoveled to interest groups.

Read the rest at Big Government.

Obamageddon: Why the U.S. Economy Is the Titanic Headed for the Iceberg

From Big Government:

America is in shambles from sea to shining sea. Unemployment is at Great Depression levels. Real Estate is collapsing. The stock market is crumbling. Retail sales are vanishing. Consumer confidence is plummeting. Inflation is skyrocketing (on the products that matter- energy and food prices). And of course, our U.S. Triple A credit rating is gone for the first time in history.

America is staring at economic disaster- Obamageddon. We are the Titanic, headed straight for the iceberg. Even delusional 500 point up days on Wall Street will not change the frightening long term picture. The iceberg is straight ahead.

Obama and his socialist cabal have channeled Hoover and FDR, who turned an ordinary bust into The Great Depression with a toxic strategy of more government, more spending, more debt, more entitlements, more rules and regulations strangling business, higher minimum wages, more power to unions, higher taxes, more printing of money by Fed, and trade tariffs. This is the Obama blueprint squared.

Here’s where the story gets downright frightening. This time the results are going to be dramatically worse than 1929. This time we are facing The Greatest Depression ever. Obamageddon.

Why? Because The Great Depression had NONE of problems and obligations we are now facing.

In 1929 America was not $100 trillion in debt and unfunded liabilities.

In 1929, most of our states were not bankrupt, insolvent and dependent on the federal government to survive. Entering the last Great Depression, California was not imitating Greece.

In 1929, we had far fewer government employees living off taxpayers. Today there are over 21 million federal, state and local government employees. Today 1 out of 5 federal employees earn over $100,000. 77,000 federal employees earn more than the Governors of their states. Government employees retire at age 50 with $100,000 pensions for life. The postal service – without competition- loses $8 billion annually. Protected by their unions and the politicians they elect, government employees are bankrupting America.

In 1929, Social Security, Medicare, and Medicaid didn’t exist. The federal government had no such obligations threatening to consume the entire federal budget within a few years.

In 1929, there was no such thing as welfare, food stamps, aid to dependent children, or English as a second language programs. American’s didn’t consider it the responsibility of government to pay for breakfast and lunch for school students – let alone illegal immigrants.

In 1929, we didn’t have millions of illegal immigrants and their children collecting billions of dollars in entitlements from U.S. taxpayers.

In 1929, legal immigrants wanted only to work. My grandparents from Russia and Germany received no government benefits. They worked day and night to provide for their family and become American citizens. It was sink or swim.

In 1929, we had 150 million citizens with a strong work ethic- all motivated to earn the American Dream for their children and grandchildren. Americans were hungry in 1929. Today the hungry, motivated citizens and entrepreneurs are in China and India.

In 1929, we had an education system that was the envy of the world. Today our public schools are in shambles. We spend the most in the world, and get among the worst results. The difference today? Teachers unions are in charge, instead of parents.

Our dumbed-down students are taught socialism and the great benefits of big government. They graduate with few skills, qualified only for low paying manufacturing jobs that no longer exist- they’ve been shipped to China and India. How will this hopeless, helpless, clueless workforce earn a living for the rest of their lives?

In 1929 taxes were much lower. Forget the tax rates- they were meaningless. In those days we had a cash economy, so most businesses paid little or no taxes. Sales and FICA taxes didn’t exist. Today the combined local, state, property, gas, sales, FICA and federal taxes are the highest burden in history. This stifles entrepreneurship and hinders the financial risk-taking necessary to create jobs and get out of a Great Depression.

Yet in the face of this unprecedented carnage from sea to shining sea, government bureaucrats think it’s a priority to shut down lemonade stands run by 4 year olds. And have SWAT teams raid farms for selling…raw milk. And clamp down on Americans sitting in their own bedrooms, on their own computers, playing online poker with their own money. Insanity reigns.

Do you get the picture? This Obama Great Depression is compounded by levels of debt, taxes, spending, entitlements, government bureaucracy & idiocy, as well as sheer numbers of government employees and illegal immigrants never imagined in 1929. Disaster looms. The iceberg bears down upon us.

We are in deep, deep trouble. There is no easy way out. The economy is crumbling. The situation is turning more hopeless by the hour. All of this is caused by big government. Yet Obama’s solution is bigger government. We are addicted to spending. Obama’s solution is more spending. We have mountains of debt. Obama’s solution is more debt. Taxpayers and the Tea Party are revolting. Obama’s solution is to blame the victims.

The solution is simple- cut government, cut spending, cut entitlements, cut the debt, cut taxes, stop the wars, end the Fed, term limit politicians, back the dollar with a gold standard…and most importantly, send Obama packing before there is no economy or country left to save. Or, like so many other great empires of history, America may never recover from this greatest of all depressions.


Has the Greatest Depression Already Begun?

From Big Government:

I am a successful small businessman and a patriot who loves America and always sees its greatness. I am also an optimistic, positive thinker who always sees the glass half full.

But not this time.

I predicted doom if Obama was elected. Sadly the results are far worse than imagined. The economy is in shambles. America is staring at economic disaster — Armageddon. Even me, the eternal optimist is scared at what the future holds. We are the Titanic, headed straight for the iceberg.

America has always been a land of boom and bust. It’s just part of business cycle. But Obama and his socialist cabal have channeled Hoover and FDR, who turned an ordinary bust into The Great Depression with a toxic strategy of more government, more spending, more debt, more rules and regulations strangling business, higher minimum wages, more power to unions, more entitlements, higher taxes, more printing of money by Fed, and trade tariffs. This is the Obama blueprint squared.

The question this time is, is Obama doing it because he understands nothing about business? Or does he understand exactly what he’s doing? Is Obama’s goal to overwhelm the system, incite crisis, sow doubt about capitalism, and force the citizens to beg for government to save them, thereby opening the door to Socialism? Is Obama’s plan to redistribute the wealth, and at the same time to bankrupt the people with wealth and power, thereby crippling his political opposition?

Does it really matter?

Read the rest at Big Government.

Video: Don’t put it on our tab

From Hot Air:

The College Republicans have a new video and petition that has become quite a hit on Twitter today, and for good reason. One nation got too arrogant about big government and bigger promises to its people about spending money that they didn’t have. It led to a collapse and a massive bailout. The US? No, but the CNRC doesn’t want a sequel:

I don’t want a sequel, either. Michelle Pfeiffer went on to better things, and Maxwell Caulfield more or less disappeared, but … oh, wait, we don’t want a Greece II, not Grease II. Either one would be a disaster.

Government: Destroying Your Wealth a Trillion Dollars at a Time

From Big Government:

Recent financial headlines provide a remarkable glimpse into America’s future if we stay on the same track we are now.  From Bloomberg news we learned:  “US Stocks fluctuate amid concerns European debt crisis hasn’t run course.”  Meanwhile, the IMF predicted that the “US national debt will soon reach 100% of GDP.”  Sadly, the World’s, the United States’ and California’s (16% of the US Economy and the 9th largest economy in the world) financial prospects are far worse than those headlines recognize.

The US economy is nearing $15 trillion in gross domestic product (GDP) per year.   The national debt it carries on the books is nearly that high and will certainly reach it, and far surpass it, within 2 years given the trillion dollar deficits that are predicted as far as the eye can see.  Of course, off the books, in accounting that would make Enron blush, the US government has $75 trillion or more in long term unfunded liabilities.  On a more short term basis consider this: the US Government revenues are running below $3 trillion dollars per year – yet its debt is over $13 trillion and growing.  In other words, the existing US debt is 4 to 5 times its current revenue.

Imagine if you will, if your credit card debt was 4 times your current income and the income you are likely to earn in each of the next 4 years.  There is not a bankruptcy attorney in the country that would not tell you that it is time to declare bankruptcy.  For its part, California is projected to have unfunded liabilities as high as $600 billion or 6 ½ times it current revenues.   Sadly for the US and California taxpayers, bankruptcy is simply not an option.

Read the rest at Big Government.

Faber: Nations Will Print Money, Go Bust, Go to War…We Are Doomed

From Big Government:

Today the leading Austrian economic think tank, the Ludwig von Mises Institute held a conference at the University Club in Manhattan in which Marc Faber, famed contrarian investor and publisher of the “Gloom, Boom and Doom Report” gave his perspective on the financial crisis and his outlook for the future.

Below are his main points and entertaining quotes:

  • Central banks will never tighten monetary policy again, merely print, print, print
  • Bubbles used to be concentrated in 1 sector or region in the 19th century, but off of the gold standard this concentration has ended
  • “The lifetime achievement of Greenspan and Bernanke is really that they created a bubble in everything…everywhere.”
  • “Central banks love to see asset prices go up,” and their policy reflects their desperation to perpetuate this
  • US housing bubble that Greenspan could not spot (even though he has recently spotted bubbles in Asia) stands in stark contrast to that of Hong Kong in 1997, where prices fell by 70%, yet none of the major developers went bankrupt; this was a result of a system not built on excessive debt like that of the US
  • “You have to ask what they were smoking at the Federal Reserve,” during the housing bubble, as prices were increasing by 18% annually when interest rates started to steadily rise in 2004
  • Over the last couple of years, when the gross increase in public debt has exceeded the gross decrease in private debt, markets have risen, whereas when private debt growth has outpaced public debt growth, markets have tanked
  • The next 3-5 years will be highly volatile

Read the rest at Big Government.

God Bless America

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But ambitious encroachments of the federal government, on the authority of the State governments, would not excite the opposition of a single State, or of a few States only. They would be signals of general alarm… But what degree of madness could ever drive the federal government to such an extremity. — James Madison, Federalist No. 46, January 29, 1788

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