Wednesday, August 16, 2017

Fire and Fury

Churchill, Truman and Stalin at Potsdam, July 26, 1945
(first published in North State Journal 8/16/17)

"They will be met with fire and fury like the world has never seen.”

Has any American President before President Trump ever issued such direct and descriptive terms to a foreign adversary? Or has every other President turned the other cheek when the United States has been threatened by a madman, dictator, Emperor, King or power-mad maniac and let them do what they wanted to do?

Consider the excerpts below from the Potsdam Declaration of July 26, 1945 which was signed by
President Harry S Truman, Chiang Kai-shek, the President of China and Winston Churchill, PM of Great Britain and issued to the Emperor of Japan as the ultimate ultimatum to end the bloodiest war the world has ever known, World War II:

  1. 'The full application of our military power, backed by our resolve, will mean the inevitable and complete destruction of the Japanese armed forces and just as inevitably the utter devastation of the Japanese homeland.
  2. The time has come for Japan to decide whether she will continue to be controlled by those self-willed militaristic advisers whose unintelligent calculations have brought the Empire of Japan to the threshold of annihilation, or whether she will follow the path of reason.
  3. We call upon the government of Japan to proclaim now the unconditional surrender of all Japanese armed forces, and to provide proper and adequate assurances of their good faith in such action. The alternative for Japan is prompt and utter destruction.'

Other US Presidents have ‘rattled the saber’ when it came to identifying the threat to American and free world interests and spoken directly about the danger at hand.

Ronald Reagan called Libyan strong man Muammar Kaddafi ‘a mad dog of the Middle East (who) has a goal of a world revolution’ (1986)

Thomas Jefferson responded to the tribute demands of the Bey of Tripoli with this short, direct answer: ‘I sent a small squadron of frigates into the Mediterranean.’ (1801)

Teddy Roosevelt didn’t say ‘Speak softly but carry a big stick’ because he was inviting foreign adversaries to a tea party at the White House.

Perhaps if President Trump had cribbed the above language from the Potsdam Declaration and had Chinese President Xi Jinping sign it along with every ally America has around the world, his threats to North Korea might have been considered less alarming to the mainstream media and his political opponents.

No one really knows what is going on inside the head of Supreme Leader of DPRK Kim Jong-Un. He and his father and grandfather have been bewildering outside observers since 1946 like evil villains in a bad James Bond movie series.

Perhaps he is jockeying for more concessions as he exacted from Presidents Bill Clinton and Barack Obama. Perhaps he is appearing to stand up to ‘evil America’ to prolong his regime amidst fears his life will end in similar fashion to Romanian dictator Nicolae Ceausescu and his wife who were overthrown and publicly executed on Christmas Day, 1989.

In 1981, Israel grew so concerned about Saddam Hussein in Iraq developing a nuclear reactor they instigated an air strike and destroyed it before it was fully operational.  If China can not or will not force North Korea back into the world of reason, what choice would the free world have left other than to destroy any nuclear missile before it left its launchpad?

The one thing the world has to agree on is that the Supreme Leader of North Korea must never be allowed to push the button that launches a nuclear-tipped missile anywhere in the world.


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Thursday, August 10, 2017

Lottery Millionaires versus 'Regular' Millionaires



(article first published in North State Journal 8/9/17)

Richard Reeves has written a book, “Dream Hoarders” to explore the widening gap between the upper income class of America and everyone else.

The gap is widening, there is no doubt. But is it because upper-income people are deliberately ‘hoarding’ things and intentionally ‘denying’ others the fulfillment of their dreams and aspirations?

Do upper-income people do things that are inherently detrimental to society or do they actually contribute a lot more to society than they take out themselves?

Consider this stark example:

There have been perhaps 10,000 large to mega-large lottery and Powerball and Super-Mega-Powerball winners in America over the past 25 years that have made people millionaires to super-millionaires.

The odds of winning the most recent national Powerball was estimated to be one in 292 million. There are about 320 million people living in 126 million households in America today to give you some perspective.

Did these lottery super-winners create tons of new jobs for anyone else on their way to becoming super wealthy? Did they invest in any new plant, machinery or technology that was created by other people who employed hundreds, perhaps thousands of other people who supported their families on those jobs in order to become ‘super-wealthy’?

No. The answer is that maybe 100 or so state employees at the state lottery office had jobs because of the lottery in their states. Certainly not thousands. Or hundreds of thousands.

On the other hand, it is estimated that there are now close to 10.8 million millionaires in America according to a CNBC report on March 24, 2017. “In 2016, there were 9.4 million individuals with net worth between $1 million and $5 million, 1.3 million individuals with net worth between $5 million and $25 million, and 156,000 households with more than $25 million in net worth,” the report says.

You have a much higher chance of becoming a millionaire in any other fashion than playing the lottery. One in 12 households in any other venue versus one in 292 million for Super Powerball.

Some no doubt did it the old-fashioned way with inherited wealth from their families. However, according to some wealth managers, less than 2 percent of all the wealth created by the fantastically wealthy families in the 19th and 20th Centuries has survived beyond even the third generation of grandsons and granddaughters. Much of that wealth was squandered along the way which also finds its way into the pockets of hard-working carpenters and laborers who build their mansions or luxury yachts before they declare bankruptcy.

Many, if not most of these millionaires made their fortunes not all by themselves but by hiring and working with great people and paying them to help build the company. Once a Bill Gates or Steven Jobs or Jeff Bezos starts to build a company based on their ground-breaking ideas, ordinary folks who join their teams early on not only get paid for their services but get fringe benefits such as health care insurance coverage and retirement plans, which sometimes includes stock that appreciates in value in the growth of the underlying company they are helping build.

The tip of the spear might be the fabulously wealthy people we all read about in the news. The truth of the matter is those entrepreneurs and business leaders made a fortune for themselves while also providing income, benefits and jobs to millions of people beyond them.

It is difficult to consider the vast number of millionaires being ‘dream hoarders’ deliberately trying to prevent others from succeeding in life. After all, they need non-millionaires to help them succeed in the first place.


We all benefit from that collective success.




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Thursday, August 3, 2017

This Is What A Budget Reconciliation Bill Looks Like

  

(from opinion page of North State Journal printed 8/2/17)

'Son, in the US Senate, there are no rules!'

So said former Senate parliamentarian Bob Dove at the completion of a two day seminar on Senate rules in 2003 when asked to sum it all up for new Senate staffers.

Now that health care reform has been torpedoed in the U.S. Senate in dramatic fashion by Senator John McCain’s deciding ‘no’ vote last week and by Republican Senators who are not up for re-election in 2018, where does that leave health care reform efforts?

For now, nowhere. The Affordable Care Act is still the law of the land whether you like it or not. Until Congress passes a bill that gets signed by President Trump, Obamacare remains the law of the land with all of its attendant promise and problems.

The Omnibus Budget Reconciliation Act of 1990 Act (pictured above) ushered in a decade of spending restraint, PAYGO budget discipline and led to four surplus budgets from 1998 to 2001.

The strategy all along from the Republican side was to pass health care reform first under reconciliation rules in order to free up enough spending savings over 10 years to allow a massive tax cut—reform bill to be passed afterwards. Budget reconciliation measures cannot increase the deficit; they can rearrange the deck chairs of tax and spending policy but cannot add to the baseline debt.

Those are the rules. We didn’t make them up. Budget reconciliation was a tool passed in 1974 to allow for expedited consideration of bills relating to spending, revenue and budget matters with only a 50 percent +1 majority in the Senate instead of the 60-vote threshold to close debate and proceed to a vote.

Now that health care reform has collapsed in the Senate, what does that mean for tax reform?

It probably means a scaled-down version of tax reform, perhaps by as much as 50 percent less. Health care repeal and replace was expected to save anywhere from $1 trillion to $2 trillion in spending over the next decade, most of which would ‘pay for’ the majority of a massive tax reform package some estimated to be close to $3 trillion over 10 years. On top of that, budget savings in the rest of the federal budget amounting to close to $1 trillion over 10 years were going to be folded into this budget reconciliation package to form what might have been called “MOBRA 2017” or the Massive Omnibus Reconciliation Act of 2017.

Tax reform will now take center stage for consideration and regular order appropriations bills will be passed to incorporate the majority of budget savings.

Will we see health care reform again this year? Many conservatives now believe Obamacare exchanges will collapse under its own weight without taxpayer bailout of the insurance companies. So why try again?

States that have expanded Medicaid under the 100 percent match for five years are now beginning to feel the pinch of having to pay for 10 percent of the expansion cost since ACA called for a reduction to 90 percent match after five years. Budget pressures will start to force match rates back down to the historical average of 63 percent federal and 37 percent state-funded further weakening Medicaid expansion.

Could the Senate take up health care again under budget reconciliation rules? Yes, if both houses pass another budget resolution and sends out a second set of reconciliation instructions. They could do that 100 times if they so choose.

As Bob Dove said, though, ‘there are no rules’ in the US Senate which means we could see health care again before the end of the year. Don’t hold your breath but stranger things have happened.

This year as a matter of fact.


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Thursday, July 27, 2017

Proximate Solutions to Insoluble Problems

(first published in North State Journal, 7/26/17)

The essence of politics, said 20th century Christian Realism theologian Reinhold Niebuhr, “is finding proximate solutions to basically insoluble problems.”

Niebuhr was trapped between his inherent pacifism and “turn-the-other-cheekism” of the Christian faith and witnessing the horrors of World Wars I and II and came to the conclusion that men and women of faith need to act to get things done even if it is not the “perfect,” most ideal solution.

If Senate Republican Majority Leader Mitch McConnell has read Niebuhr, perhaps he could challenge his colleagues this way:

The key to ever making health care in America a soluble problem is to set into place the incentives and structures that help people not get sick in the first place.

“The essence of our collective job in the US Senate this July, 2017, is to find the best option we can to get to 50 votes in the Senate, not to make the US health care system ‘perfect,’ but better than what we think it is today under the ACA.”

Many people today think that every time a bill passes Congress and is signed into law by the President, it has to 'solve all of our problems and set us free!'

Nothing could be further from the truth. The best we can and should expect out of any piece of legislation is that it somehow addresses a need and helps as many people possible without harming others in major ways.

Finding the “perfect” health care system is inherently insoluble. Nothing in the ACA, AHCA or BRCA is really getting at the heart of the problem which is reducing the cost of health care in the first place.

We Americans like the fact that we have modern medical technology, medicine and regimens that allows us to live relatively healthy lives despite the fact that the majority of Americans simply do not live healthy lifestyles.

Talk about diametrically opposed forces that make a “perfect” health care system impossible. The heavier we Americans get due to fast food, lack of exercise and excessive consumption of booze and beer, the more we want and need these medical breakthroughs to stay alive.

Until Americans lose about 25 percent of BMI, stop drinking and smoking too much, and start walking at least a couple of miles every day, our health care delivery system will continue to be insoluble. All we can really do is try to manage the health care of millions of unhealthy people as best as we can.

We are stuck with the same problems today that President Obama and the Democrats tried to ‘fix’ with ACA:

How do we provide the maximum amount of health care insurance coverage to the most number of people without bankrupting the national treasury, corporations and individual pocket books?

Here’s some things to think about which will get at the core of the problem:

1. Everyone in the United States should have access to some form of catastrophic health insurance coverage to protect them against the loss of everything in the case of a catastrophic health event.

2. If you want to pay for private health insurance without the benefit of any tax deductions, you can do whatever you want with your body and health.

3. If you receive health coverage from any government source such as Medicare, Medicaid, VA, or get a tax deduction through your business, you will be enrolled in a managed health care organization, that will help you learn how to take better care of yourself.


The key to ever making health care in America a soluble problem is to set into place the incentives and structures that help people not get sick in the first place. That sounds so elemental but sometimes simple solutions are the best.

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Monday, July 24, 2017

Can We Solve Health Care In America?

(Which Einstein probably never said...
but if anyone did, he should have)
Sometimes, the best thing we can do for you is to relay pertinent data from respected sources whom we trust and then ask you just to read it with some of our inserted comments as food for thought.

Health care is complicated enough as it is before thinking about amending, repealing and then replacing ACA with AHCA or BCRA I or II. Some clear thinking and explanation is always in order when you think or talk about health care insurance coverage in America.

Here's a piece by Joseph Antos and Jim Capretta, a health care policy analyst we have known for quite some time. This is a direct reprint of their July 24, 2017 article in the AEI blog so if you have any questions, perhaps I can refer them to the authors to answer.

Annotations are inserted in blue below:

'The Congressional Budget Office (CBO) produced cost estimates for two of the three versions of the Better Care Reconciliation Act (BCRA), sponsored by Senate Republican leaders. A comparison of the June 26 and July 20 estimates confirms that the two BCRA versions do not differ substantially from each other.

CBO has not estimated the impact of the much-discussed amendment to the BCRA sponsored by Senator Ted Cruz (R-TX), which is included in the July 13 draft. That provision would allow insurers to sell products to consumers that are out of compliance with the requirements of the Affordale Care Act (ACA), as long as they also offer at least one ACA-compliant product at each metal level.

The July 20 version of the BCRA incorporates several major policy changes from the June version, including:

  1. The new taxes on high-income families imposed by the Affordable Care Act (ACA) would be retained. Those taxes, the Medicare payroll tax of 0.9 percent on the wages of high earners and the 3.8 percent tax on the non-wage incomes of the same households, would have been repealed by the earlier version of the BCRA. (As a matter of tax policy, this should be repealed for the simple reason that this is the first time in American tax history that a 'payroll tax' of any kind has been assessed against 'non-wage incomes'. Payroll taxes are either taxes on payroll wages or they are not. This is a bad precedent the Obama Administration and 2009-2010 Congress tried to set)
  2. An additional $70 billion would be added to the State Stability and Innovation Fund.
  3. Funds from Health Savings Accounts (HSAs) could be used to pay the premiums of high-deductible health insurance plans purchased on the non-group market.
  4. A new $45 billion fund would be established to support state efforts in combating the opioid epidemic. This fund does not figure prominently in CBO’s estimates of the coverage and premium effects of the legislation. (Not sure if this is the right vehicle to deal with our opioid crisis. This appears to be adding financial incentives for senators with high opioid addictions and traffic to vote for the underlying reform bill but it appears to us that dealing with the opioid crisis in a separate bill with more discussion and input might have a higher chance of solving the problem)

CBO’s assessment of the most recent BCRA draft includes the following key findings:

  • The legislation would reduce federal spending by $903 billion over ten years and reduce federal revenues by $483 billion over the same period. The net deficit reduction over the coming decade would be $420 billion. CBO estimated that the June version of the BCRA would have reduced federal revenue by $701 billion over ten years, or $218 billion more than the tax cuts in the current version of the legislation. (When we have a $20 trillion national debt that is still growing, deficit-reduction would seem to be a welcome outcome of health care reform if it can be done)
  • CBO estimates that the revised BCRA would increase the number of people going without health insurance by 15 million in 2018 and 22 million in 2026. These estimates are essentially unchanged from CBO’s previous estimate. (This is mainly due to the dropping of the individual mandate. (see Avik Roy's explanation) If there is no penalty for not having health insurance, it stands to reason that more people, mainly young healthy people not covered by a large corporate or educational network, would just drop paying for coverage. They think they are 'immortal' at that age anyway..until something happens and they realize they are not)
  • The largest spending reduction in the revised BCRA is in the Medicaid program. CBO estimates the bill would reduce Medicaid spending by $756 billion over ten years, of which $575 billion comes from pulling back on the enhanced federal matching rate for the ACA’s expansion of the program. (This may be one of the most under-reported stories about the ACA, which also stands to reason given the media's preoccupation with Russia and collusion, etc. The ACA paid 100% of the costs of states expanding their Medicaid population for the first 5 years of expansion and then 90% thereafter...except the Obama Administration and the Democrats in 2010 never expected that a future Republican President in concert with a Republican Congress might just bring the traditional federal-state matches back into line on the expanded population one day.

    Historical federal/state matches average 63%/37%. If you live in a state with a 100% match for the expanded Medicaid population, which are not the women with dependent children or disabled already covered by Medicaid prior to 2010, you can expect to see enormous cost hikes at the state level to start paying for that 'fair share' of the 37% match by the states for this expanded population.

    Or enormous tax hikes to pay for it. Or a severe reduction in funds appropriated for teacher salaries, new road construction or any other state government function. 
  • The proposal to impose per-person limits on future federal expenditures for the program accounts for most of the remaining savings. CBO expects Medicaid enrollment to decline by 10 million people in 2021 and 15 million in 2026.
  • CBO expects that terminating the penalties associated with the individual mandate would lead to large-scale withdrawals from coverage and additional adverse selection in the individual insurance market. Those changes would not be so severe as to lead to a breakdown in the market. As with current law, the subsidies provided in the BCRA would be sufficient to ensure enough participation to keep the market stable, although at lower enrollment levels.
  • The revised BCRA would increase average premiums in the individual market before 2020, and then reduce them in the ensuing years. (Gonna be a hard sell for people who have already seen a doubling or tripling of their health insurance premiums since the advent of ACA. They want to see at least a freeze of premiums starting tomorrow and then a reduction over time. 
  • The increase would occur primarily because of the elimination of the penalties associated with the individual mandate, which would lead some healthier insurance enrollees to exit the market. CBO expects average premiums in the individual insurance market to increase by 10 percent in 2019. Beginning in 2020, the BCRA would tie the restructured premium tax credits to plans with an actuarial value of 58 percent, compared to 70 percent under current law. As a result, average premiums in 2026 would be about 25 percent below the average under current law.
  • The BCRA makes income-based tax credits available to everyone with incomes up to 350 percent of the federal poverty level. Households below the poverty level would pay no more than 2 percent of their incomes in premiums to get coverage in the individual insurance market.
  • However, CBO estimates that many of these low-income households would not sign up for coverage because of increased deductibles as a result of moving to a lower actuarial value for approved plans.
  • In 2026, a single policyholder purchasing a benchmark plan with an actuarial value of 58 percent would face a $13,000 annual deductible. (Most deductibles hovered below $5000 before ACA) That deductible would exceed the annual income of a person at 75 percent of the federal poverty line ($11,400). For a person at 175 percent of the federal poverty line ($26,500 in 2026), the average deductible would represent about one-half of his annual income.
  • CBO’s estimates of the revised BCRA make it clear that the new version of the legislation is unlikely to improve how the legislation is perceived by the public. (Maybe if the press would get off of its fixation on shiny objects such as 'The Russian Connection' and try to help explain how these health care proposals will affect every person that would help some)
  • Republicans in Congress would like to roll back the penalties associated with the ACA’s individual mandate, but CBO’s methodology for assessing health reform legislation puts great weight on these penalties for inducing enrollment into coverage. The Republican effort to reduce federal spending associated with the ACA also makes it difficult to provide what many would view as reasonable health coverage for low-income households.
  • Senate Republicans have been struggling to come up with a formulation that would allow them to move away from the structure of the ACA while still providing reasonable security to people who need support to get insurance. It is clear from CBO’s estimate that they have not yet succeeded — but there is still some maneuvering room, at least in fiscal terms.
  • The American Health Care Act, passed by the House of Representatives on May 4, would provide $119 billion in deficit reduction over the next decade. According to congressional rules, the Senate version must provide deficit reduction at least equal to that amount. Given CBO’s latest score, Senate Republicans could spend as much as $300 billion more to create better opportunities for affordable coverage in the private market while transitioning to more prudent financing for the Medicaid program.' (Most individual purchasers of health care insurance would just settle for a freeze in their premiums and then a reduction over time)



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Friday, July 7, 2017

When A Rising 'Unemployment Rate' Would Be 'Great News!'

We have been so conditioned to think about the 'unemployment rate' as being the sole indicator of strength in the labor market that using it as the only beacon sometimes might lead us off course.

We have long been writing about the inherent fallacies of the 'official' unemployment rate put out by the Bureau of Labor Statistics each month which are: A) The formula has changed so much over the years as to make comparisons with past data like comparing apples to oranges and B) It can be used to mask what is really going on in the economy for purely political purposes.

Imagine that. Politicians and spinmeisters using government data for purely political purposes.

First of all, here is the official BLS data put out today.

No one in the press or on the mainstream or cable news is going to read it out loud to you verbatim, since they have their own individual agendas to pursue and political axe to grind so let us give you the 'highlights' without the hype and the fanfare and trumpets sounding or worry beads rolling in their hands:
  • The unemployment rate, at 4.4 percent, and the number of unemployed persons, at 7.0 million, were little changed. (although the rate did inch up from 4.3% to 4.4% since May)
  • Total non-farm payroll employment increased by 222,000 (yea!) in June, and the unemployment rate was little changed (how come?) at 4.4%
  • The number of long-term unemployed (those jobless for 27 weeks or more) was unchanged (boo!) at 1.7 million in June and accounted for 24.3 percent of the unemployed.
  • Over the year, the number of long term unemployed was down by 322,000 (yay!)
  • The labor force participation rate, at 62.8% changed little (boo!) in June and has shown no clear trend over the past year. The employment-population ratio (60.1%) was also little changed in June and has held fairly steady thus far this year.
  • In June, 1.6 million persons were marginally attached to the labor force, down by 197,000 from a year earlier. (yay!) (The data are not seasonally adjusted.) These individuals were not in the labor force, wanted and were available for work, and had looked for a job sometime in the prior 12 months. They were not counted as unemployed because they had not searched for work in the 4 weeks preceding the survey (yay!) 
Sort of boring if you don't really dig into the numbers a little bit more deeply.

There ya have it! One side will say 'this is all great! and the other will say 'this is all terrible!'
However, we see the latest data as 'moving in the right direction' for the following reasons:
  1. Even though the unemployment rate did not change much, it did change some going from 4.3% to 4.4%.

    If that trend holds for most of the rest of 2017, and the 'official' unemployment rate keeps inching up each month ever so slightly, then that means more and more people are feeling more confident about their job prospects and future and will enter or re-enter the labor force and look for a job.

    They are NOT counted as being in the work force unless and until they are actively interviewing and looking for employment. Technically, more people 'actively' looking for work expands the total official 'labor force' so if they can't find a job immediately, the unemployment rate goes up to account for this new influx of people.

    Consider a situation where 5 million people are unemployed out of a work force of 100 million people. The unemployment rate would then be 5%, 5 divided by 100=5.

    If 1 million new active job applicants show up to look for work tomorrow, however, 6 million people will be technically 'unemployed' until they can find a job. The 'official' labor force would then be 101 million Americans either in the work force or 'actively looking' (key operative words) for work.

    The new, hopefully temporary 'official' unemployment rate would then be 5.94% tomorrow, up dramatically from just 5% today. 6 million people looking for work divided by 101 million people in the active labor force, 6/101 or 5.94%.

    See how tricky the unemployment data game is? No wonder people can play games with the data politically, yes?

    However, no one would dispute that having this hopefully temporary, higher unemployment rate would be a great thing for the economy since it meant a million new people were optimistic about finding a job now and they were taking active steps to find a job.

    That would be 'great news' in anyone's book, right?
  2. The absolute number of people who are employed now in full-time jobs is 2,078,000 more than one year ago in June 2016. 153,168 million people.

    153,168 million people working today > 151,090 million people working in June 2016 which is a good thing by anyone's standards.
  3. The employment-to-population ratio is now 60.1, up from 59.6 in June 2016, a 0.5 difference.

    That might not sound like a lot until you consider that the employment-to-population ratio has not been over 60 since (drum roll) April of 2009 when we were flying right into the maw of the economic hurricane now known as the Great Recession.

    Some people tried to explain this all away by the aging of the massive Boomer population as they retired as if all of them were leaving the workforce at the same time due to some common innate biological signal like turtles returning to nest in the same place or salmon dying after spawning.

    We can only find evidence that supports about 30% of this exodus from the workforce as being attributable to planned retirements by Boomers.

    The other 70% of the people leaving the workforce had more to do with the severe economic contraction; the wiping out of savings; the plummeting of home and land values and the crash of the stock market so that many just retired on some form of combination of a pension, a smaller version of IRA or some sort of government assistance through disability or Social Security.

    The mere sign of the employment-to-population ratio poking its head above 60 has got to be as encouraging of a sign as crocuses poke their heads through the melting snow after a harsh and terrible winter.
  4. In a similar manner, the participation rate at 62.8%, even though the BLS calls it 'little changed', is good news as well since it is going up, not down as it has done so essentially for the past 17 years.

    It is too early to see if this is a sustainable upwards trend but if it is, it is very good news because it means more people, from Millennials to aging Boomers are actually 'confident' enough about the direction of the economy and the job market to actively go out and interview and try to find a job whereas for much of the past 8 years for sure, they have chosen to do the opposite.

    But we do know this, just because of sheer human nature: People don't look for work unless they think they can actually find some gainful employment and that confidence level in the American economy has been rising ever since the elections last November, 2016.



So. There you have it. The unvarnished truth about today's employment data. You can spin it however you want.

Just make sure you have the facts first and share them with your friends, families, colleagues and your political adversaries.

They will be glad you did.

**definition of terms from BLS:
  • The number of people in the labor force. This measure is the sum of the employed and the unemployed. In other words, the labor force level is the number of people who are either working or actively seeking work.
  • The national unemployment rate. Perhaps the most widely known labor market indicator, this statistic reflects the number of unemployed people as a percentage of the labor force.
  • The labor force participation rate. This measure is the number of people in the labor force as a percentage of the civilian noninstitutional population 16 years old and over. In other words, it is the percentage of the population that is either working or actively seeking work.
  • The employment-population ratio. This measure is the number of employed as a percentage of the civilian noninstitutional population 16 years old and over. In other words, it is the percentage of the population that is currently working.





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Monday, July 3, 2017

Celebrating The Freedom To Not Agree

This Fourth of July, do something a little different than celebrating our collective cherished freedoms of speech, religion, assembly, the news media press and right to petition for grievances.

And eating hot dogs and watching baseball and fireworks displays.
Celebrate the same freedom to NOT agree with anyone's freedom of speech, freedom of worship, right to assemble, freedom of the press or right to petition for grievances.
Those are just as important, if not more important, as any of the enumerated rights in the First Amendment, which are a lot in just one amendment when you really think about it.

Remember that the United States of America had its birth 241 years ago not because they were celebrating all of their agreements with the King and Great Britain.

This country was founded primarily on the basis of all of their disagreements with the King and Great Britain enumerated at the end of this post in the Declaration of Independence but prefaced by this memorable paragraphs now known the world over (except in places such as North Korea, Iran etc):
  • We hold these truths to be self-evident, that all men are created equal, that they are endowed by their Creator with certain unalienable Rights, that among these are Life, Liberty and the pursuit of Happiness. —
  • That to secure these rights, Governments are instituted among Men, deriving their just powers from the consent of the governed, — That whenever any Form of Government becomes destructive of these ends, it is the Right of the People to alter or to abolish it, and to institute new Government, laying its foundation on such principles and organizing its powers in such form, as to them shall seem most likely to effect their Safety and Happiness.
  • Prudence, indeed, will dictate that Governments long established should not be changed for light and transient causes; and accordingly all experience hath shewn that mankind are more disposed to suffer, while evils are sufferable than to right themselves by abolishing the forms to which they are accustomed.
  • But when a long train of abuses and usurpations, pursuing invariably the same Object evinces a design to reduce them under absolute Despotism, it is their right, it is their duty, to throw off such Government, and to provide new Guards for their future security. — Such has been the patient sufferance of these Colonies; and such is now the necessity which constrains them to alter their former Systems of Government.
Think about the American history of disagreement over our entire history.  We had no sooner formed a government in 1789 than we began bickering and arguing and politicizing everything and using the press to lambaste opponents (Jefferson hated Hamilton; Adams hated Jefferson; everyone hated Hamilton and on and on and on. If you think current politics is 'nasty' and debased, go back and read some of the news clippings about the way our hallowed Founders treated each other in public. It makes current politics looks like Romper Room to be honest)

'Disagreement' might as well have been etched into stone walls of Congress when it was erected. It has been that important to the creation and growth of the American Republic.

Despite the fact that many millions of people did not agree with the agenda of President Barack Obama, they all had the freedom to speak out against his policies; write about them in the press (and, increasingly day-by-day, on social media which is supplanting mainstream media outlets), not participate in any rallies supporting his policies and not agree with the positions of people wanting to to petition the government for grievances, although certainly we all should support their right to do so even if we don't agree with them.

Today, many millions of people do not agree with the agenda of President Donald Trump and/or the Republican Senate and Congress. They do not have to agree with any of those agendas and have the same rights to not agree with them or even listen to them just as what happened on the other side during President Obama's terms in office.

Isn't that a remarkable concept our Founders gave us long ago? Thank God for all of that freedom!

What would this country be like if we all had to agree on everything one person in the White House at the top or one Congressional session told us to do..'or else!'?

'Or else!' what? It would be awful and it wouldn't be America.

The one thing both sides should agree on is the need to disagree in a not-so-disagreeable manner. Nor should either side condone, and not condemn, violence whenever it erupts on their side or the other.

If you don't like what one side is doing politically, all you have to do is one or all of the following:

1. Turn off the TV set
2. Stop listening to talk radio
3. Get off of social media
4. Volunteer to get someone elected you do agree with
5. Run yourself
6. Contribute money, time and effort to get people you agree with elected
7. Go to the beach, mountains or some cave somewhere and get off the grid totally

All of these activities connote some degree and sense of 'disagreeing' with the opinions and policies other people want to pass on society which includes you whether you like it or not.

You can listen to someone speak if you want to. You don't have to listen at all. You certainly do not have to agree with them just because something comes out of their mouth or brain activity.

You don't have to agree with anything you read in the press. You can disagree with it all you want. You can consider it all 'fake news' or 'the gospel truth' but that doesn't mean I or any other person have to agree with you or the press that writes it. That is a very healthy thing in a democratic republic such as ours.

You don't have to agree with the religious beliefs of any person you know or don't know. You don't have to agree there is 'religion' at all, as John Lennon sang about in 'Imagine there's no heaven..' But you do have a responsibility to respect their views and honor their freedom to worship freely.

You don't have to agree with the list of 'repeated injuries and usurpations' any group might petition the government to overturn. But you should support their right to do so since if they are prevented from ever presenting their grievances, one day it might be your grievance that is being denied a fair hearing.

Many times, it takes a pretty brave person to stand up against the tide of popular opinion and say these words: 'I respectfully disagree with all of you. And let me tell you why...'

Sometimes, it take a very brave person to do so. In a very few cases, it takes the most brave of all brave people to speak truth to power. Just as the Founders did in 1776, come to think about it; they knew they were not only risking their fortunes but their very lives if they lost the War against the vaunted British forces.

'Y'all are really not gonna mess this all up,
now are you?'
Benjamin Franklin put it pretty simply when he said this right before he signed the Declaration in
1776:

"We must, indeed, all hang together, or most assuredly we shall all hang separately." 

We pretty much are at a state in American history where disagreement in a not-so-disagreeable manner is most needed, yes?

Unless we can all recover a sense of common purpose as Americans and 'hang together' as in 'stick together' as Franklin meant metaphorically and recover a common civil discourse with great elected leaders who know how to negotiate and compromise and get to 'proximate solutions to basically insoluble problems' as Reinhold Niebuhr said, surely 'we will all hang separately' when it comes to dealing with foreign threats, internal budget deficits and national indebtedness and social unrest and class warfare.

Let this Fourth of July be different. For all of us. It is up to each of us to make the difference when it comes to civil discourse. Let's all start trying harder.

We can do this.

*List of grievances for colonists in 1776:

The history of the present King of Great Britain is a history of repeated injuries and usurpations, all having in direct object the establishment of an absolute Tyranny over these States. To prove this, let Facts be submitted to a candid world.

He has refused his Assent to Laws, the most wholesome and necessary for the public good.

He has forbidden his Governors to pass Laws of immediate and pressing importance, unless suspended in their operation till his Assent should be obtained; and when so suspended, he has utterly neglected to attend to them.

He has refused to pass other Laws for the accommodation of large districts of people, unless those people would relinquish the right of Representation in the Legislature, a right inestimable to them and formidable to tyrants only.

He has called together legislative bodies at places unusual, uncomfortable, and distant from the depository of their Public Records, for the sole purpose of fatiguing them into compliance with his measures.

He has dissolved Representative Houses repeatedly, for opposing with manly firmness his invasions on the rights of the people.

He has refused for a long time, after such dissolutions, to cause others to be elected, whereby the Legislative Powers, incapable of Annihilation, have returned to the People at large for their exercise; the State remaining in the mean time exposed to all the dangers of invasion from without, and convulsions within.

He has endeavoured to prevent the population of these States; for that purpose obstructing the Laws for Naturalization of Foreigners; refusing to pass others to encourage their migrations hither, and raising the conditions of new Appropriations of Lands.

He has obstructed the Administration of Justice by refusing his Assent to Laws for establishing Judiciary Powers.

He has made Judges dependent on his Will alone for the tenure of their offices, and the amount and payment of their salaries.

He has erected a multitude of New Offices, and sent hither swarms of Officers to harass our people and eat out their substance.

He has kept among us, in times of peace, Standing Armies without the Consent of our legislatures.

He has affected to render the Military independent of and superior to the Civil Power.

He has combined with others to subject us to a jurisdiction foreign to our constitution, and unacknowledged by our laws; giving his Assent to their Acts of pretended Legislation:

For quartering large bodies of armed troops among us:

For protecting them, by a mock Trial from punishment for any Murders which they should commit on the Inhabitants of these States:

For cutting off our Trade with all parts of the world:

For imposing Taxes on us without our Consent:

For depriving us in many cases, of the benefit of Trial by Jury:

For transporting us beyond Seas to be tried for pretended offences:

For abolishing the free System of English Laws in a neighbouring Province, establishing therein an Arbitrary government, and enlarging its Boundaries so as to render it at once an example and fit instrument for introducing the same absolute rule into these Colonies

For taking away our Charters, abolishing our most valuable Laws and altering fundamentally the Forms of our Governments:

For suspending our own Legislatures, and declaring themselves invested with power to legislate for us in all cases whatsoever.

He has abdicated Government here, by declaring us out of his Protection and waging War against us.

He has plundered our seas, ravaged our coasts, burnt our towns, and destroyed the lives of our people.

He is at this time transporting large Armies of foreign Mercenaries to compleat the works of death, desolation, and tyranny, already begun with circumstances of Cruelty & Perfidy scarcely paralleled in the most barbarous ages, and totally unworthy the Head of a civilized nation.

He has constrained our fellow Citizens taken Captive on the high Seas to bear Arms against their Country, to become the executioners of their friends and Brethren, or to fall themselves by their Hands.

He has excited domestic insurrections amongst us, and has endeavoured to bring on the inhabitants of our frontiers, the merciless Indian Savages whose known rule of warfare, is an undistinguished destruction of all ages, sexes and conditions.

In every stage of these Oppressions We have Petitioned for Redress in the most humble terms: Our repeated Petitions have been answered only by repeated injury. A Prince, whose character is thus marked by every act which may define a Tyrant, is unfit to be the ruler of a free people.


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Wednesday, June 28, 2017

'Facts Are Just The Bare Bones Out Of Which Truth Is Made'

Even the dry bones of Ezekiel can do basic math to
see the truth of federal budgeting and health care policy
So said historian Shelby Foote who was a Civil War expert and was featured on Ken Burns' PBS documentary on that topic.

Here's some observations and guidelines to use when trying to evaluate the merits or demerits of the currently-extant ACA or the House Republican to change it, AHCA or the American Health Care Act or the Senate Republican plan, BCRA, the Better Care Reconciliation Act:



  1. Never argue with anyone who doesn't even know what these acronyms mean; if they don't, it means they have not read any of them at all on their own.
  2. Never argue with anyone who can't refer to any underlying basis of fact from any accredited most-likely government source such as the CBO (Congressional Budget Office), GAO (Government Accounting Office) or BLS (Bureau of Labor Statistics) among about 20 others.
  3. 'Never argue with stupid people. They just drag you down to their level and beat you with experience'--Mark Twain.
You really are not going to get a full picture from the news media nowadays either so don't rely on them for any in-depth understanding or knowledge of the health care system in America or any of proposed solutions. Many if not most of major American news outlets today rely on the same talking points put out by the respective national political party apparatchiks in Congress and print them as 'real news' when in fact, they are pure political spin gruel.

So don't eat it. It is bad for your mental health.

Here's some basic 'bare-boned facts' you need to know so you can find the truth on your own and not have to rely on cable or network news which seems to have put ratings and business concerns ahead of nuts-and-bolts basic journalism which is so important to the workings of a democratic republic such as ours:
  • There is a limited amount of money taxpayers are willing to part with to pay for national, state and local public policy needs and goals. Any time someone says: 'Just raise taxes then!' you can dismiss them as starry-eyed dreamers who really don't even know what is currently being paid in taxes to support current government as it is today.

    Federal tax revenue has stayed at roughly a fairly even level of 18.5% of GDP for the past 40 years and counting. There is no reason to believe that all Congress and the President have to do is snap their fingers and pass higher taxes...and Americans will blindly and blithely go along with them without trying to find ways to avoid paying them. It just won't happen.



  • Add in local and state taxes and over 40% of our national GDP is accounted for by taxation. It was half that in 1940 and half that amount again in 1914.

    Our Founders must be doing head-spins in their graves.
  • There is a limited amount of money that can be borrowed from overseas or from private sources. Foreign investors just won't send another $100 trillion or so of their money to the United States 'just because we are the United States of America and nothing bad will ever happen to our currency or economy!"

    They aren't that crazy. Bond market investors, domestic and foreign, understand the risks of lending capital to countries that overspend their revenues and what that can do to the underlying currency valuations and ability to repay those enormous debts.

    We have written about this for almost a decade now but we now have over $20 trillion of federal debt to pay back somehow which represents close to 100% of annual GDP.

    In 1980, federal debt accounted for 32% of annual GDP. High debt-to-GDP ratios are typical of war time eras. Peace time eras are the time when national debt is usually paid off or reduced as a percentage of GDP through economic growth.



  • We can't spend every available tax dollar on Medicaid in expansions across the nation. Just like we can't pay every available dollar on Medicare, Social Security, defense or welfare programs.

    Although pretty soon, 100% of every available tax dollar we bring in each year, as in the year 2025!!!!, WILL be spent on some combination of Social Security, Medicare, Medicaid and interest on the national debt...AND NOTHING ELSE!

    Every dime we spend on new aircraft carriers, fighter jets, homeland security, environmental protection, welfare, housing, education, transportation, R&D will have to be borrowed from somewhere. Even though we will be way over the 100% of debt-to-GDP ratio most observers deem as 'dangerous' fiscal territory for any nation.

So, what does this all mean for the AHCA, BCRA and ACA?

It means 'something has to give'. We are not fighting about politics or philosophy right now.

We are fighting basic math and arithmetic. And the forces of economic reality that have not been overturned yet.

Here are two articles worth your read that are too extensive to explain right now, both by Avik Roy written in Forbes:

https://www.forbes.com/sites/theapothecary/2017/05/23/the-right-way-for-gop-senators-to-replace-obamacares-tax-credits/#5a3b2039100c

https://freopp.org/means-testing-tax-credits-for-the-uninsured-key-design-considerations-739df86c9ccd

But read them with the context of these 'bare-boned facts' stated above in your mind so you will begin to understand the critical nature of doing health care reform the right way.

2 truly revolutionary things are in the Republican alternatives:
  1. Reverting total control of Medicaid spending and policy back to each state.
  2. Adjusting the tax credit part of buying health care insurance to a level where most people could afford to use it rather than face an enormous $10,000+ or more per year financial 'cliff' that would otherwise force them to just do without health insurance in the first place.

    More on both these articles later.
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Friday, June 16, 2017

People Who Believe 'Government Can Solve Everything' Obviously Have Never Worked In It

'Don't You Want Someone To Love?'
We were talking to a decided liberal the other day who has been pretty adamant about his opposition to any budget cuts proposed under President Trump and the Republicans.

He was complaining about the difficulties he had been facing as he was working with various government agencies in Washington and various states to get an alcohol and drug remediation program funded not over the past 6 months but the past 10 years, 8 of which were under President Obama.

'I hate the government!' he exclaimed. 'You can't believe how many hurdles and blockades we have run into getting this program going!' he huffed.

'But you are the one who LIKES more government, aren't you?' we humbly asked.

'Not in this case!' he stormed.

Welcome to the party, pal.  The party of the 'real world' of human nature versus the esoteric theoretical 'world' of postulations and lofty expectations for what government can or should possibly do.

Before you start screaming about any federal or state government budget cuts proposed by President Trump or the mean old Republicans in any legislature, ask yourself the following questions:

  1. Do you think every government program ever passed should be funded in perpetuity forever and ever and ever regardless of the actual results of the program? 
    'Oh, no! Not another immortal federal program!'


    In that case, we should still be funding a federal bounty program to kill wolves in the West, a program that started in the 1800's and was only stopped in 1965.

    Which would be totally ridiculous, yes?
  2. If a government program has achieved its stated purpose, should it be dissolved or continued?

    Our very favorite example of this wasteful spending of your tax dollars has been and always will be the Federal Helium Reserve Act of 1925.

    What was helium used for back then, you ask?

    Filling surveillance dirigibles for war purposes, of course. Blimps. Like the one that just crashed at the US Open yesterday by the way.

    Care to guess when this program was finally stopped by Congress?

    1996. Except that it was not 'finally stopped' then either. It is still with us in 2017 as amendments were passed to continue the program for some unknown reason.

    Unless we have figured out a way to use helium to produce a cloaking device on all stealth bombers and fighters, the strategic military use of helium has long gone the way of the dodo bird and passenger pigeon. And still, Congress has some of your tax dollar going to support this program.
  3. If a federal or state government program HAS NOT 'solved' the targeted problem it was aimed at, should it be continued or changed, amended or eliminated?

    LBJ's grand idea, The Great Society, was a slew of anti-poverty programs passed in 1964-65 designed, in LBJ's words:

    "(The Great Society) rests on abundance and liberty for all. It demands an end to poverty and racial injustice, to which we are totally committed in our time. But that is just the beginning.”

    $22 trillion adjusted-for-inflation of your tax dollars have been spent to eradicate poverty and lift everyone up economically since 1964 and the poverty rate remains the same, if not higher.

    A various array of social and societal ills still beset our nation, some of which have been exacerbated by the very Great Society programs that were intended to fix the problems, not complicate them.

    Should all of these programs be continued without question or concern? Or should all of them be subject to serious public oversight by our elected representatives in Washington to see which should be continued, which should be amended and which should be ended forthright?
If you had ever worked inside of the federal government, or the state or local government for that matter, you would know what we are talking about. Looking to government to 'solve everything' might be an enticing dream from the 'outside looking in' but from the inside, government in many cases 'just ain't what it is cracked up to be'.

Hence, one of the reasons why we are for less of it. Not more.

The problem with turning to government to 'solve everything' ignores the fact that government workers are human beings, just like you and me, all with their various human quirks and foibles who respond to incentives and avoid pain and risk just like we all do.

Sometimes, as in the case of The Manhattan Project or NASA landing a man on the moon before the end of the 1960 decade, government workers and contractors can pull off the most outlandish, impossible-sounding feat imaginable. Many times, however, government becomes the slow drag on progress, a never-ending cycle of delay, obfuscation, over-regulation and diversion of responsibility and nothing of any great consequence ever 'gets done' as our friend above lamented.

They are not all angels, although a few may be from time to time. They are not all rocket scientists, great financial money managers, detail-oriented task solvers or even nice people all the time.

Just as in any business, school, academic of higher learning, science lab, gas station or church setting.

Almost all government workers, as well as all of us outside of government, respond positively to praise and possibilities for personal advancement either through promotion, higher pay or bonuses and negatively to harsh criticism and perceived unfair treatment by superiors.

It is just human nature.

We are of the opinion that there is not one federal government program that can not be reduced in spending, except the amount of money we are legally obligated to pay each year for interest on the burgeoning national debt, now at $20 trillion and still climbing.

If you accept the notion that the federal government budget is not a sacred text handed down from on high and can, and should be, inspected thoroughly as noted above, then you should join the effort to reduce federal spending whether you are an avowed liberal as our friend above or a committed conservative as any Tea Party person might be.

Uniting to reduce unnecessary federal spending across-the-board should be one thing we should all do this year and every year.

Just let us know if you are interested in learning how to do it. Here's a place to start for your summer reading at the beach: CBO Options for Reducing the Deficit 2017-2026.

Read it with a cold Corona Extra or margarita nearby. You are gonna need it.


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Friday, June 2, 2017

'We Will Always Have Paris (Accords) To Deal With'

We wrote several posts over the past couple of years that basically asked this question of supporters of President Obama's executive actions and unilateral agreement-making through the White House and not with the cooperation of the US House or Senate:

'Will you be just as happy to see a Republican President in the White House use those very same executive unilateral powers to A) unwind all of President Obama's executive unilateral actions and/or B) bind the US to policies that only he and a minority of his political party want to see passed?'

The Paris Climate Accords are just the latest casualty of that failure to adhere to the US Constitution as currently written. What was written and signed essentially by one man in the 3-part governing system of the United States has now been upended by another man with the stroke of a pen and 1 press conference.

Is that really the way the Founders wanted to see us run this country, essentially through one-man rule from the White House?

Setting aside all of the arguments for and against controlling carbon emissions, what should President Obama have done to make sure the US would abide by and adhere to the Paris Climate Accords: 

Submit it to the US Senate for ratification as a treaty.

Sure it would have been difficult to get it through the US Senate and get the 2/3rds votes necessary for ratification.

But passing legislation and treaties in the United States has never been easy. Nor should it be. The process is set up to insure that legislation duly passed by majorities and super-majorities last for a long time.

Consider the enormous challenge faced by President Abraham Lincoln when he wanted to pass the 13th Amendment to the Constitution to abolish slavery. The process started in the Senate in 1864 before the elections that fall when it looked like President Lincoln might lose because of the duration of the Civil War.

However, in the midst of the bloodiest war our country has ever experienced in terms of loss of life for American soldiers and citizens, President Lincoln lobbied and cajoled and persuaded enough House and Senate members to get to the 2/3rds majority necessary to send the amendment to the states for ratification.

If you saw the Steven Spielberg movie 'Lincoln', you will remember that passage of such controversial legislation was not based just on lofty philosophical musings and speeches but on cold hard deal-making, job offers and political jockeying.

That is the 'real world' of politics and legislation. It does not operate in a vacuum or in some sterilized laboratory somewhere. It happens on Capitol Hill and in all state legislatures and municipal government councils and commissions each and every day.

President Obama chose not to do the 'dirty work' of passing such a controversial piece of legislation, this time in the form of a binding US treaty, to ratify the Paris Climate Accords that only he signed, not the US government as a whole.

Just to say that is is 'too hard' to pass something through the Senate or Congress is not enough to justify not trying to get it done. Not trying to pass something because it will be difficult to pass is, quite honestly in our constitutional form of governance, lazy. It also goes against close to 241 years now of American history where a lot of things appeared to be too hard to try to change only to see those things actually change and improve through the fortitude and leadership of just a few key people.

Our guess is that President Trump and his team will change some of the terms of the Paris Accords, particularly in the area of synchronizing the effective dates of compliance so that China and other nations all start on the same date as the United States, and then resubmit them to the other partners for their consideration.

Remember: This President wrote a book called 'The Art of the Deal'. Other signatories to the pact say that 'The Paris Accords can not be renegotiated!' which is a little silly when you think about all of the bills, treaties and agreements that have been rewritten and renegotiated over time.

It is hard work. But it can be done.

So, so far into 5 1/2 months of President Obama's retirement, thousands of his unilateral executive actions have been reversed or canceled in their entirety; thousands of pages of regulations put forth by his Administration are now being unwound or reversed by the new Administration; his ban against the construction of the Keystone Pipeline has been lifted; his fuzzy 'red line' drawn against Syria has been obliterated and now his unilateral acceptance of the terms of the Paris Climate Accords has been reversed.

You know the only thing that has not been reversed yet, for those who supported President Obama and his term in office?

The Affordable Care Act. Obamacare.

You know why?

Because it was, contrary to so much else done under President Obama's two terms in office, duly passed through both the US House of Representatives and the US Senate and signed into law by President Obama in compliance with the US Constitution.

Until a majority of the US House and US Senate can pass something to either repeal it in its entirety or replace it with something else, the ACA will remain the law of the land.

Keep that in mind next time you cheer on a US president who says he or she is signing this or that in the name of the United States of America.

Because, as we are now seeing in the aftermath of President Obama's executive actions, they won't last for very long. Especially when the other side wins the next election.

We have a Constitution for a reason. Read it every now and then to remind yourself of the incredible foresight our first generation of elected leaders had to look far into the future and implement ways to limit the powers of one person in this country to run things without the consent of the majority of citizens as expressed through elected representatives, not public opinion polls.


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Thursday, May 25, 2017

When More Spending Means Less And Up Is Down and Down Is Up (Only in Washington)

'I guess these bubbles are increasing in number...but what if I say they are 'decreasing' in number? What then?-
OMB Director from Another Dimension Neo
Quick Test for Math Competence:

Are these numbers below increasing or decreasing in absolute gross total amounts?
(please be careful because any rational discussion of the US federal budget depends on whether you are capable of doing the most basic of all human functions, meaning 'counting')

$3,853,000,000,000
$4,062,000,000,000
$4,094,000,000,000
$4,340,000,000,000
$4,470,000,000,000
$4,617,000,000,000
$4,832,000,000,000
$4,933,000,000,000
$5,073,000,000,000
$5,306,000,000,000
$5,527,000,000,000
$5,708,000,000,000

If you said 'Increasing, of course, you silly!', you win! Ding-ding-ding!

Because you will have mastered the art of understanding basic accounting and financial management unlike 99% of the media and apparently most of the liberal Democrats now in Congress and the US Senate and more than a few Republicans, sadly.

These numbers...are the projections...for the next 10 years.....in the Trump budget just put forth by OMB and explained really well by OMB Director Mick Mulvaney (who grew up in Charlotte, by the way before moving across state lines to get elected to Congress from Rock Hill, South Carolina before going to OMB)

Year-by-year, even the most elementary of all elementary students can see that these numbers are going up, not down, even if they have to take off 9 zeros at the end to make them more comprehensible to smaller minds.

And yet, the media and Senate Minority Leader Chuck Schumer and House Minority Leader Nancy Pelosi are screaming bloody murder and waving bloody shirts and flags as if this budget was a declaration of war.

Why is it that in our hallowed halls of Congress, in the highest elected government offices in the land, many to most elected leaders treat numbers and budgets as if they are in an episode of 'The Matrix' where up is down and down is up and inside is outside and outside is inside?

It is because they do not want you to know the truth or understand the federal budget. The more they can obfuscate, dissect, paper-over and distance the real truth from you, the voting public, the more they can manipulate your emotions and feelings when it comes election time.

And the press is no better. If they were 'better' at understanding numbers and budgets, they would shut down the screamers and wavers of bloody shirts each time simply by saying: 'Are you out of your mind? These numbers are not 'cuts'; they are INCREASES!'

But the press can't even admit common sense and basic arithmetic anymore since so many of them have abandoned any pretense of 'impartiality' and thrown their fortunes in with one political party or the other.

That is not 'journalism' in the purest light of American freedom of speech and the press. That is 'propaganda promotion' which is as dangerous to our freedom as suppression of free speech anywhere.

The problem is that crafty budget staffers and press secretaries to powerful budget chairmen in Congress came up with the concept of a 'baseline budget' in the Congressional Budget Act of 1974 which really needs to be removed and replaced with some form of zero-based budgeting requirement.

The idea was to 'project' into the future what federal programs would cost if basically indexed for inflation and population growth and really not much else. Gone are any requirements to dig into the programs and budgets and see if they are actually WORKING to achieve a solid public policy purpose or not; they basically go on autopilot and grow forever.

If anyone dares to reduce or try to rein in spending from one of those 'projected' higher levels of spending in these federal budgets, that is called a 'cut' for some reason. It is as if those projections are etched into stone by the finger of God on Mount Sinai or something and mere mortals are not supposed to ever change them at all.

That is like saying we are heading towards a cliff in a car and with each passing day we are going to go 7% faster...and never let up on the accelerator. It is almost cause for an intervention to be honest.

Ronald Reagan once famously said in his iconic 'A Time For Choosing' speech on October 27, 1964 in a final pitch for GOP presidential candidate Barry Goldwater:

“A government bureau is the nearest thing to eternal life we’ll ever see on this earth.”

Test your own nerves by taking a look at the following list of 66 programs (below) President Trump has proposed not for just reduction but total elimination.

Keep in mind that the purpose of having federal programs in the first place is to provide services that affect and help ALL of the citizens in this country and not just a few here and there. Such universal service we all need include national defense, homeland security, interstate highways, airports and perhaps a few other select programs.
  • If a state or local government can do the job better and more efficiently, then the federal government probably should not be involved.
  • If the private sector can provide the same service for less cost and higher quality, let the private sector do it.
(Please don't use the argument that PBS is an 'essential national service' any longer when virtually any child in America now has access to the internet either through a mobile device in his or her little hands or computer and thereby has access to thousands of media channel outlets, many of which are educational in their own right such as National Geographic or the History Channel. The private sector can and has done many of the educational things PBS was originally set up to do when there were only 3 major TV outlets in the country: CBS, NBC and ABC.)
  • If charitable and eleemosynary organizations can address problems, let them do it first. 
Each of us can point out 1, maybe 2 programs on this list we consider 'essential' to keep. But not all of them.

We have come to our own 'Time To Choose' to adopt Ronald Reagan's phrase above and it is how are we going to A) balance our budget; B) pay off our $20 trillion+ (and growing) national debt; C) grow our economy back up to 3%+ annually while D) providing for only the essential public services this nation needs.

When elected leaders failed to balance the budget on an annual basis starting back in the 1960s really but especially since 2001 (so both the Bush 43 and Obama White Houses are culpable as well as every Congressman and Senator who served during those times and failed to do anything to prevent the onslaught of federal deficit-spending that has gotten us into this mess we are in today), they effectively painted us into an actual real corner fiscally.

  1. We have to raise taxes to pay for all this spending...which ain't gonna happen in a million Sundays.
  2. We have to cut spending across-the-board in every program in an non-discriminate manner.
  3. We have to cut discretionary spending severely if we don't touch any entitlement program (since they represent close to 77% of the budget now when added to defense and interest expense)
  4. We have to start to wean wealthy seniors off of social welfare programs such as Social Security and Medicare mainly because both programs were designed to help 'poor seniors' in their golden ages, not wealthy people.
That is the 'Time for Choosing' we face today. More on the Trump budget later, although you might as well start reading it now.

And keep this stamped on your the front of your brain: 
'THERE IS NO OVERALL SPENDING 'REDUCTION' IN THIS BUDGET! IT IS INCREASING EVERY SINGLE YEAR!'
Some budget hawks actually might get mad that the federal government would still grow at about a 5%/year clip under this Trump budget instead of about 7% or more per year if nothing is done to curtail our out-of-control spending from Washington.


Programs targeted for elimination:

Agriculture Department — $855 million

·       McGovern-Dole International Food for Education

·       Rural Business-Cooperative Service

·       Rural Water and Waste Disposal Program Account

·       Single Family Housing Direct Loans


Commerce Department — $633 million

·       Economic Development Administration

·       Manufacturing Extension Partnership

·       Minority Business Development Agency

·       National Oceanic and Atmospheric Administration Grants and Education


Education Department — $4.976 billion

·       21st Century Community Learning Centers

·       Comprehensive Literacy Development Grants

·       Federal Supplemental Educational Opportunity Grants

·       Impact Aid Payments for Federal Property

·       International Education

·       Strengthening Institutions

·       Student Support and Academic Enrichment Grants

·       Supporting Effective Instruction State Grants

·       Teacher Quality Partnership

Energy Department — $398 million

·       Advanced Research Projects Agency—Energy

·       Advanced Technology Vehicle Manufacturing Loan Program and Title 17 Innovative Technology Loan Guarantee Program

·       Mixed Oxide Fuel Fabrication Facility

Health and Human Services — $4.834 billion

·       Agency for Healthcare Research and Quality

·       Community Services Block Grant

·       Health Professions and Nursing Training Programs

·       Low Income Home Energy Assistance Program

Homeland Security — $235 million

·       Flood Hazard Mapping and Risk Analysis Program

·       Transportation Security Administration Law Enforcement Grants

Housing and Urban Development — $4.123 billion

·       Choice Neighborhoods

·       Community Development Block

·       HOME Investment Partnerships Program

·       Self-Help and Assisted Homeownership Opportunity Program Account

Interior Department — $122 million

·       Abandoned Mine Land Grants

·       Heritage Partnership Program

·       National Wildlife Refuge Fund

Justice Department — $210 million

·       State Criminal Alien Assistance Program


Labor Department — $527 million

·       Migrant and Seasonal Farmworker Training

·       OSHA Training Grants

·       Senior Community Service Employment Program


State Department and USAID — $4.256 billion

·       Development Assistance

Earmarked Appropriations for Non-Profit Organizations

·       The Asia Foundation

·       East-West Center

·       P.L. 480 Title II Food Aid

State Department, USAID, and Treasury Department — $1.59 billion

·       Green Climate Fund and Global Climate Change Initiative

 Transportation Department — $499 million

·       National Infrastructure Investments (TIGER)

Treasury Department — $43 million

·       Global Agriculture and Food Security Program

Environmental Protection Agency — $493 million

·       Energy Star and Voluntary Climate Programs

·       Geographic Programs

National Aeronautics and Space Administration — $269 million

·       Five Earth Science Missions

·       Office of Education

Other Independent Agencies — $2.683 billion

·       Chemical Safety Board

·       Corporation for National and Community Service

·       Corporation for Public Broadcasting

·       Institute of Museum and Library Services

International Development Foundations

·       African Development Foundation

·       Inter-American Foundation

·       Legal Services Corporation

·       National Endowment for the Arts

·       National Endowment for the Humanities

·       Neighborhood Reinvestment Corporation

·       Overseas Private Investment Corporation

Regional Commissions

·       Appalachian Regional Commission

·       Delta Regional Authority

·       Denali Commission

·       Northern Border Regional Commission

·       U.S. Institute of Peace

·       U.S. Trade and Development Agency

·       Woodrow Wilson International Center for Scholars



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