Nigel Farage: ‘Who the Hell do You Think You Are: The Euro Game Is Up!

Nigel Farage, explains the fascistic nature of the Euro-zones leading intellectual and political elite.

I have not seen a more eloquent speech in ages!

The British say it so well sometimes…

Best Explanation of Quantitative Easing

A very educational video on Quanitative Easing.

It explains why everyone says its a bad idea yet the fed is doing it!

Watch the whole thing!

The Ideological Drive for Balanced Budgets and Where the Right Splits

Everyone Agrees, Deficits are the Problem, Not the Solution!

With Washington on a “recovery” spending binge and Congress participating in deficit spending for the last 30 years, the country is sitting on a mountain of debt. The American people have decided it time we stop increasing the debt and balance the budget. The massive entitlement program created by Socialist Democrats and Liberal Republicans cannot be sustained at the current tax rate. Deficit spending cannot work as a long-term solution, since the federal debt will eventually grow too large, devaluing the currency and collapsing the economy. There is a choice to be made: either the budget must be balanced through cutting programs (spending) or increasing taxes. Liberals who are supporting spending increases have decided that raising taxes “at some point” in the future is the answer (the alternative being to bankrupting the treasury); Conservatives desire a different path.

In Classical Liberalism (Conservatives and Libertarian ideology), there are many different theories on government methods to regulate spending and pay off national debt. The schools of thought in this ideology all include a core belief in smaller government and fiscal responsibility to create a balance budget but diverge in its execution.  This small government school of though is found among Conservative/Libertarian Republican circles but also exist among fiscally responsible Democrats who also desire balanced budgets but with more active government spending policies.

The Schools of Thought for Balanced Budgets

The diverse opinions within Classical Liberalism are administrative disagreements on the approach lawmakers should take when tackling budget problems. These strategies for fiscal budgeting can be sorted into three groups: Those who believe in balanced budgets with reciprocal tax increases to meet deficits, those who believe in cutting spending to meet current tax levels, and those who believe maintaining deficit spending when times call for it.

Among one school of fiscal Conservatives (and many Liberals who believe in responsible government) the balancing of the budget is the prime mission of government before new spending or tax decreases can be made. Government must have a balanced budget immediately, because the debt it a seeping wound of the nation’s wealth, and must be fixed before it grows too large. This first group of Conservatives believe the best way to balance the budget is to raise taxes to eliminate the deficit. While believing in smaller government in the longterm, these individuals desire a quick solution to debt by balancing budgets in the short-term. Once government spending is determined for a fiscal year, the taxes for that year should be raised to meet that level of spending, otherwise the debt will eventually destroy the nation. In the long-run decreasing taxes and decreasing spending can occur simultaneously, maintaining balance.

The second group of fiscal Conservatives is concerned with out of control spending and wish to prevent tax increases which decrease tax revenues and economic growth. These theorists believe in supply side economics endorsing the concept that government revenues decrease, as taxes are increase and reciprocally, revenue increases and the economy grows when taxes are lowered. Conservatives of this supply side economics school believe in a massive curbing of government expenditure to reduce the deficit. Programs must be cut and waste removed to reach a point where government expenditures meet the current or lowered tax rate.

These first two groups of fiscal hawks share a common goal of reducing the federal deficit to eventually pay off the national debt. One is willing to forgo pushing for smaller government at the start and desire to balance the budget immediately by raising taxes, whiles the other, strives to attack “wasteful spending” and cut federal expenditures to equal current tax levels. These groups both believe strongly in the concept of balanced budgets and have adopted positions and proposals to solve the issue.

The Plans and Where Conservatives Split

Some fiscal hawks endorse changing the House and Senate rules on voting for spending bills and budgets. They support rules requiring Congress to need super majorities to vote on increases in spending and taxes which contribute to the culture of deficit spending in Congress. They also desire a line-item veto that would give the President power to veto specific spending proposals within any bill that could be considered pork, restoring fiscal responsibility. Another solution that has gained steam: is an Amendment to the Constitution requiring Congress to pass balanced budgets.

One such group known as “One More Vote” is petitioning Congress to adopt a previously attempted amendment that failed in 1995 by 1 vote. This Amendment would force Congress to balance the budget each year. A secondary effect of this proposed amendment would require 60% majorities in both houses of Congress to raise taxes or propose any spending increases.

The last group of conservatives that are fiscal hawks agree in principle with the first and second groups, but believe Congress should always maintain the ability to control the budget without structural change. They agree that spending should be cut and taxes should remain low, but after a balance budget is restored, Congress should maintain the ability to conduct deficit spending. This third group argues that there are many situations such as a recession, or infrastructure plans that may arise that will require spending beyond the proposed budget. While this group does not ignore the dangers of national debt, they are cautious to limit Congress’s ability to raise taxes or increase spending when necessary!

While each of these ideologies differs on methods to execute a balance budget and whether Congress can later deviate from this policy, the consensus among conservatives is that the national debt needs to stop its exponential growth before it is too late!

US Debt, the Millionaire Tax Failure, Declining State Revenues



Budgets and Bankruptcy:

The hot buzz issue of the 2010 election is federal spending and the national debt. In the last 30 years federal spending has increased astronomically and so has federal borrowing to pay for these programs. In the coming year’s insolvent entitled programs (Social Security, Medicaid, Obamacare) will require massive allocations of federal revenues to sustain these programs as an aging population requires increased medical and social security benefits. These increasing unfunded liabilities and a continuation of massive spending bills for entitlement, stimulus and other government programs will result in deficits that revenues cannot keep up with. The debt will balloon, making US treasury bonds unattractive to investors, bankrupting the United States and preventing the possibility of more borrowing to fund basic government.

We cannot continue on this current path! Every day we do not solve the debt crisis is a day closer to government bankruptcy. Raising taxes to meet these deficits will shut down growth and actually decrease revenues. While some say, tax the rich to fund it, this is a foolish and unworkable program. To fund these programs that mostly benefit the poor and lower middle class, the middle and upper class’s taxes must increase to massive levels that would drive the middle class into lower class income status.

Donald Trump gives an accurate picture on the wealthy international class and the effect of higher taxes:

http://video.foxnews.com/v/4294961/trump-keep-taxes-down/

If you were to tax the rich as the main source of tax revenue to fund the debt you also created a major economic problem and decrease revenues! On close examination of raised taxes on the rich such as New York State’s Millionaire’s tax, the revenues from those individuals actually decreased because those people left New York State to avoid tax hikes! Even Paterson admitted the failure of the Millionaire tax:

“Similarly, New York enacted a “millionaire tax” that raised tax rates on all residents making more than $200,000 a year. However, since New York implemented their so-called millionaire tax its state revenue has declined by 9 percent. According to New York Governor David Paterson:

We increased the income tax for millionaires last year. We projected that we would get $4 billion and we actually got well short of it. Tax the rich, tax the rich. We’ve done that. We’ve probably lost jobs and driven people out of the state.”

Source: Freedom Works

When the federal government increases taxes for the rich on a national scale, businesses and individuals make the tough decisions to move themselves or their assets overseas to protect it. Investment that could be directed to the United States will be directed at Europe or developing nations. The United States will make itself even poorer if we rely on taxes to solve debt problems.

If increasingly higher taxes won’t fix the problem creating adverse economic conditions that would demand more deficit spending to keep the economy afloat, our only option is to cut spending!

Is the “Balanced Budget Amendment” a good idea to save the deficit? Is the question I will address next post.

A future article will also address actually budget numbers and creative means for knocking down the deficit.

Sources on debt numbers from Heritage.org:

http://www.heritage.org/research/reports/2010/08/reining-in-runaway-spending-and-deficits

http://www.heritage.org/Research/Reports/2004/06/The-Laffer-Curve-Past-Present-and-Future