About Me

In writing the "About Me" portion of this blog I thought about the purpose of the blog - namely, preventing the growth of Socialism & stopping the Death Of Democracy in the American Republic & returning her to the "liberty to abundance" stage of our history. One word descriptions of people's philosophies or purposes are quite often inadequate. I feel that I am "liberal" meaning that I am broad minded, independent, generous, hospitable, & magnanimous. Under these terms "liberal" is a perfectly good word that has been corrupted over the years to mean the person is a left-winger or as Mark Levin more accurately wrote in his book "Liberty & Tyranny" a "statist" - someone looking for government or state control of society. I am certainly not that & have dedicated the blog to fighting this. I believe that I find what I am when I consider whether or not I am a "conservative" & specifically when I ask what is it that I am trying to conserve? It is the libertarian principles that America was founded upon & originally followed. That is the Return To Excellence that this blog is named for & is all about.

Saturday, February 29, 2020

Trump's 2021 Fiscal Year Budget Priorities

Early in BO’s administration Ann Coulter recommended the elimination of the Departments of Health & Human Services, Education, Commerce, Agriculture, HUD, Transportation, the EPA, the National Endowment of the Arts, the National Endowment for the Humanities, & the progressive income tax & instituting a flat tax.  At the time, I seconded Ann’s recommendation except I recommended eliminating the progressive income tax & replacing it with the FairTax.
 
On February 10, 2020 President Trump released his budget for fiscal year 2021 (October 1 to September 30 2021) entitled A Budget For America’s Future – Fiscal Year 2021.
 
Trump’s budget calls for nominal GDP levels of $22.5 trillion to $36.6 trillion from 2020 to 2030 respectively, real GDP growth of 2.8% to 3.1% over the next ten years, a CPI inflation rate averaging 2.3%, ten year Treasury note rates of 2.0% in 2020 increasing to 3.2% in 2030, & the annual average civilian unemployment rate rising from 3.5% in 2020 to 4.0% in 2030.  See Table S-9, entitled Economic Assumptions below.


In 2020, the U.S. will spend $1.29 for every $1 that it will collect in revenue (Outlays = $4,790 billion / Receipts = $3,706 billion leaving a budget deficit of $1,083 billion ).  See Table S-1, entitled Budget Tools below.


Professor Friedman taught that money available for taxation is composed of direct taxes & borrowing & that the portion of the national debt that is paid every year is the interest payments on that debt.  Who could possibly think that if the budget deficit was magically wiped out that government spending would be reduced to equal revenue.  No, government spending would still equal the $4,790 billion listed in the table above for 2020.  A deficit is simply a form of hidden taxation financed either by printing money or by an invisible tax on all property as more money is taken from the future income of that property.
 
Increasing the debt is the easiest thing in the world for politicians to do because they know that interest payments are the least damaging expenditure of government.  Interest payments  are simply transfers from tax payers to bond holders that do not use up any resources – there is no labor that is unavailable for something else.  It is the opportunity cost of what could have been done with the money provided by bondholders that is the real cost & this is the most evil & cruelest part of debt financing – the part that is never seen or even imagined except by that one person in a million that Lenin did not want to meet.
 
With GDP growing a little over 2% per year the Congressional Budget Office reports that for the fiscal year ending September 30, 2019 revenue grew 4% & spending grew 8.25% meaning economic growth is generating additional tax revenue but the government is growing 4 times faster than the economy.  Now you don’t have to be long time subscriber Economics 501 to know this is not sustainable.  Do your own calculations using the CBO table below to derive the revenue-spending relationship for fiscal year 2019.


The above fiscal year 2021 Trump budget has proposed increases in outlays for defense & veterans but has also included lower nondefense spending & according to Forbes’ analysis calls for eliminating such fraudulent items as paying $10 billion Social Security benefits to dead people or benefits to the supposed six million people on Social Securities’ books who are 112 years old or older – for the record there are only 40 people in the whole world that are 112 & older.  Forbes also reports that Medicare & Medicaid overpaid recipients by $67 billion last year & that the IRS wrongly paid out $18.4 billion through the earned income tax credit program.
 
But all of the above mistaken payments are small in the overall scheme of things & in all likelihood neither these mistaken payments or the entitlement spending that causes the large budget deficits will be addressed by a Democrat House until after the November presidential election.  Since funding of the federal government is in place through the end of the fiscal year we should expect to once again go the Continuing Resolution government funding route starting on October 1 & lasting @ least until next winter when a new government convenes.
 
Sixty percent of federal spending goes toward paying Social Security, Medicare, & Medicaid – the three programs that constitute the cornerstone of America’s welfare state.  Ten percent of federal outlays goes toward paying interest on the national debt leaving 30% for discretionary spending like defense, food stamps, foreign aid, & the departments listed for elimination @ the top of this post.
 
Our elected representatives’ (i.e.,  temporary politicians) inhumanity & lack of regard, concern, or sympathy for people dependent on Social Security & Medicare has been on full display for decades – both programs are headed for substantial reduction in benefits in the not too distant future. 
 
Page 2 of the 2018 sample statement on the Social Security website clearly says that “by 2034, the payroll taxes collected will be enough to pay only about 77 percent of scheduled benefits.”  Of course the alternative to lowering benefits is to raise taxes.  Joe Sternberg wrote in the WSJ “one also has to ask why future generations of workers should be forced to pay higher proportions of the fruits of their labors to fund benefits for old timers who refused to raise their own taxes or to reform benefits.”
 
The problem with Medicare is that Medicare Part A is facing a funding shortfall that will require a 12% reduction in hospital benefits by 2029 & the cost of Parts B & D, which are 81% funded by general revenue from the Treasury, are growing too fast to be sustained.
 
If you are interested in solutions to the Social Security & Medicare problems click on the referenced posts listed below.
 
As we all know from previous budgets President Trump’s obvious interests are funding Defense & reducing the trade deficit through leveling the playing field in the global economy of international trade.  Students of international economics know there is no such thing as free or fair trade because virtually every country in the world uses tariffs, quotas, quota licenses, tariff rate quotas, export quotas, domestic content requirements, subsidies, export subsidies, dumping – sporadic, predatory, & persistent government procurement policies, & social regulations such as the average fuel economy standards of cars to protect their workers.  And of course the workers needing the most protection are the lowest skilled least educated people. 
 
Accordingly, as politicians try to buy votes to get re-elected or elected to higher office in 2020, President Trump works to put America first realizing there is no free & unfettered trade. Protectionist trade policies implemented to benefit the weak, in one form or another, reigns @ the expense of the American worker & consumer, & this is the state of affairs President Trump is trying to improve upon.
 
Referenced Posts:
 
 

Sunday, February 16, 2020

Liberty Score Correlation To Socialist America

"The Senators and Representatives before mentioned, and the Members of the several State Legislatures, and all executive and judicial Officers, both of the United States and of the several States, shall be bound by Oath or Affirmation, to support this Constitution; . . ." — U.S. Constitution, Article VI, clause 3
 
"I,___, do solemnly swear (or affirm) that I will support and defend the Constitution of the United States against all enemies, foreign and domestic; that I will bear true faith and allegiance to the same; that I take this obligation freely, without any mental reservation or purpose of evasion, and that I will well and faithfully discharge the duties of the office on which I am about to enter. So help me God." – The oath of office taken by Members of the House since 1966.  Since the 80th Congress (1947–1949), Members of the House have also been required to sign an oath, which is held by the Clerk of the House.  Senators take the same oath.
 
There are 435 Members of the House of Representatives & 100 Senators totaling 535 Members of Congress who take the above oath required by the Constitution – yet only 118 of the 535 Members received grades of D or higher according to the Conservative Review Liberty Score website – a tabulation of congressional votes that concentrates on fidelity to the Constitution & the oath that all Members of Congress take in binding themselves to support & defend the Constitution.  This analysis determines a letter grade & percentage Liberty Score based on actual votes taken in Congress.
 
Currently, there are 53 Senate Republicans, 45 Democrats, & 2 Independents who caucus with the Democrats.  There are 232 House Democrats, 197 Republicans, 1 Independent, & 5 vacancies.
 
Below is the list of the 118 Members of Congress who did not receive a failing grade of F.  All of the people on the passing list are Republicans (& one Independent).  Not one of the 279 Democrats received a passing grade, i.e., the voting record of all Democrats in Congress is graded F.  The highest graded Democrat in the House is Ilhan Omar (MN) (F @ 23%) & in the Senate Bernie Sanders (VT) (F @ 23%).  Amy Klobuchar, the supposed moderate running for the Democrat presidential nomination, is graded F @ a dreadful 4% support of the Constitution meaning that the Liberty Score voting analysis will flush out fakers like Klobuchar – no matter how clever the hostile anti-American media think her recent debate comments are.
 
You can use the list below when you see congressmen & senators on TV to determine how their TV talking points compare to their actual voting record Liberty Scores.  Democrat leaders Schumer (F @ 4%), Pelosi (F @ 11%), Schiff (F @ 10%), & Nadler (F @ 15%) & Republican leaders McCarthy (F @ 32%), McConnell (F @ 28%), & Graham (F @ 30%) are amoung the most disingenuous politicians regularly seen on TV
 
When Republicans on TV ask you to fight for "our conservative values" you can take it for just so much blather if coming from someone not on the list below & of course no Democrat should ever be believed if they are speaking about defending the Constitution or worrying about the deficit.  All of these people are enjoying, or are planning on enjoying, 30 to 50 year careers in Washington of power, privilege, & high incomes paid @ your expense.
 
The fact that 99 of 197 House Republicans & 33 of 53 Senate Republicans received grades of F is a source of consternation & frustration for many fiscally responsible people.  Most of the Republicans with failing grades have scores in the 40s & 50s so they can be counted on from time to time but many times they disappoint.
 
A subscriber recently sent me a column from the WAPO from last July that highlighted Republican socialistic policies like President Trump promoting agricultural subsidies to the farm industry & bailing out failing coal plants
 
There was no mention in the WAPO column of Democrat Members of Congress being socialist other than one sentence that said "some Democrats have proposed some pie-in the sky ideas (such as free college)," thereby overlooking Bernie's & AOC's proposed biggest expansion of government since LBJ's Great Society – the Green New Deal that provides universal single payer healthcare, government job & housing guarantees, & a host of impractical ideas like replacing air travel with trains & upgrading & retrofitting every building in America to make them more energy efficient.
 
But even more important, the article did not mention that no matter how strong the socialist tendencies of any president are (& the four before Trump had extremely strong socialist tendencies – BO, GW Bush, Clinton, & GHW Bush) – it is Congress that controls the power of the purse which gets us back to the point of this post that the majority of Members of Congress have failing Liberty Score grades.  The president cannot spend a dime that Congress does not approve & Members of Congress with Liberty Scores below B are not trying too hard to honor their oaths of office.  Voting for any of the Democrat presidential candidates will only exacerbate the socialist problem in America as each one lurches the others further & further toward socialism & an entirely different order of magnitude problem.
 
Socialism is characterized by state ownership of businesses & services, hence the means of production.  I have written that America is more than 50% socialist for years - in that federal, state, & local spending equals 40% of the nations income & when the mandates that government imposes on private spending is added over 50% of the output of the country is controlled by the government.  This is equivalent to saying that over 50% of the means of production is owned by the government today.
 
All 279 Democrats in Congress have Liberty Scores of F with grades below 24% & 132 Republicans in Congress have Liberty Scores of F with many in the 40s & 50s.  This tabulation provides a very good correlation for saying that more than half of the country is socialist.  This is also why Friedrich Hayek dedicated his classic book The Road To Serfdom "To The Socialists Of All Parties."
 
Professor Friedman wrote "On both sides of the Atlantic, it is only a little overstated to say that we preach individualism & competitive capitalism, & practice socialism."
 

The aforementioned WAPO column talked about the "scourge of socialsim" being "already upon us" – & the column is so right.  If Americans, including those who subscribe to the online WAPO, want to rid our country of this scourge this post presents the way to participate in that endeavor - they should concentrate on the people in Congress who are not on the list below & work to vote them out of office.

 

America was founded on the principles of limited government, personal responsibility, & free enterprise – not socialism.  The Founders set the people up as sovereign in that their will decided that capitalism, not socialsim, was the road the country originally went down.  The people's will is sovereign in America. 

 

But since the people's superiority over every entity of government is the case we have to ask how we got to be a country that is over 50% socialist in the first place.  It had to be either with the people's consent or the people's neglect.

 

If you don't see your congressman's or senator's names on the list below they received grades of F which is a problem.  If you don't know your congressman's or senator's names that could very well be the answer to the question.

 
Senators
 
Mike Braun, In – A @ 100%
Mike Lee, UT – A @ 96%
Rand Paul, KY – A @ 90%
Ben Sasse, NE – A @ 90%
Jim Risch, ID – B @ 82%
Ted Cruz, TX – B @ 80%
Josh Hawley, MO – C @ 78%
Steve Daines, MT – C @ 74%
Tom Cotton, AR – C @ 72%
Tim Scott, SC – C @ 71%
James Lankford, OK – D @ 67%
Rick Scott, FL – D @ 67%
Pat Toomey, PA – D @ 67%
Marco Rubio, FL – D @ 64%
Mike Crapo, ID – D @ 63%
John Kennedy, LA – D @ 63%
Ron Johnson, WI – D @ 62%
David Perdue, GA – D @ 62%
Joni Ernst, IO – D @ 60%
 
Senator Marsha Blackburn of Tennessee has not been graded.
 
House As @ 90 to 100%                                                                
 
Andy Biggs, AZ – A @ 100%                                                      
Chip Roy, TX – A @ 100%                                                                                  
Paul Gosar, AZ – A @ 96%                                                       
Thomas Massie, KY – A @ 96%                                         
Warren Davidson, OH – A @ 95%                                                                                           
Lance Gooden, TX – A @ 93%                                                                        
William Timmons, SC – A @ 93%                                                
Van Taylor, TX – A @ 93%                                                                                 
Ron White, TX – A @ 93%                                             
Ben Kline, VA - A @ 93%                                                      
Louie Gohmert, TX – A @ 92%                                         
Jim Jordan, OH – A @ 92%                                                                              
Gregory Steube, FL – A @ 92%                                           
Jeff Duncan, SC – A @ 92%                                                 
Mark Green, TN – A @ 92%                                             
Mark Meadows, NC – A @ 90%                                                        
Gary Palmer, AL – A @ 90%                                                
Ken Buck, CO – A @ 90%
 
House Bs @ 80 to 89% 
 
Ted Budd, NC – B @ 89%
Justin Amash, MI – B @ 88% (Ind)
Mo Brooks, AL – B @ 88%
Scott Desjarlais, TN – B @ 86%
Russ Fulcher, ID – B @ 86%
Andy Harris, MD – B @ 86%
Jody Hice, GA – B @ 86%
Scott Perry, PA – B @ 86%
David Schweikert, AZ – B @ 86%
Ross Spanos, FL – B @ 86%
Steven Watkins, KS – B @ 86%
Tim Burchett, TN – B @ 85%
Ralph Norman, SC – B @ 85%
John Ratcliffe, TX – B @ 83%
Tom McClintock, CA – B @ 82%
Trey Hollingsworth, IN – B @ 81%
Michael Cloud, TX – B @ 80%
Doug Lamborn, CO – B @ 80%
George Holding, NC – B @ 80%                                          
                                                                                                                                          
House Cs @ 70 to 79%                                
 
James Baird, In – C @ 79%                                                                        
Dan Crenshaw, TX – C @ 79%                    
Denver Riggleman, VA – C @ 79%
John Rose, TN – C @ 79%
Mark Walker, NC – C @ 79%
Ted Yoho, FL – C @ 78%
Jim Banks, IN – C @ 78%
Mike Johnson, LA – C @ 78%
Alex Mooney, WV – C @ 78%
Jim Sensenbrenner, WI – C @ 78%
Bill Posey, FL – C @ 77%
Michael Guest, MS – C @ 77%
Matt Gaetz, FL – C @ 76%
Trent Kelley, MS – C @ 77%
Debbie Lesko, AZ – C @ 76%
Jason Smith, NE – C @ 76%
Steve King, IO – C @ 74%
Mike Gallagher, WI – C @ 73%
Morgan Griffith, VA – C @ 73%
Barry Loudermilk, GA – C @ 73%
Tom Emmer, MN – C @ 73%
Daniel Webster, FL – C @ 72%
Jim Hagedorn, MN – C @ 71%
Randy Weber, TX – C @ 71%
Michael Waltz, FL – C @ 71%
Bryan Steil, WI – C @ 71%
Richard Hudson, NC – C @ 71%
Dusty Jordan, SD – C @ 71%
Daniel Mauser, PA – C @ 71%
James Comer, KY – C @ 71%
Robert Wittman, VA – C @ 70%
 
House Ds @ 60 to 69%
 
Kenny Marchant, TX – D @ 69%
Steven Chabot, OH – D @ 68%
Virginia Fox, NC – D @ 68%
Glenn Grothman, WI – D 2 68%
Clay Higgins, LA – D @ 68%
David Rouzer, NC – D @ 68%
Brian Babin, TX – D @ 67%
Mike Enzi, WY – D @ 67%
Roger Williams, TX – D @ 67%
Garret Graves, LA – D @ 66%
John Curtis, UT – D @ 65%
Kevin Heron, OK – D @ 65%
Ralph Abraham, LA – D @ 64%
Ron Estes, KS – D @ 64%
Anthony Gonzalez, OH – D @ 64%
Darin LaHood, IL – D @ 64%
Guy Rischenthaler, PA – D @ 64%
Francis Rooney, FL – D @ 64%
Michael Burgess, TX – D @ 63%
Bradley Byrne, AL – D @ 63%
Duncan Hunter, CA – D @ 63%
Markwayne Mullin, OK – D @ 63%
Chris Stewart, UT – D @ 63%
Jodey Arrington, TX – D @ 62%
Greg Gianforte, MT – D @ 62%
Billy Long, MO – D @ 62%
Tom Rice, SC – D @ 62%
Brad Wenstrup, OH – D @ 62%
Lloyd Smucker, PA – D @ 61%
Bruce Westerman, AR – D @ 61%
Adrian Smith, NE – D @ 60%
 

Sunday, February 2, 2020

Trump Economy Faces Socialist Headwinds

“The chief business of the American people is business.” – President Calvin Coolidge
 
“You can’t love jobs & hate the people who create them.” – Arnold Schwarzenegger
 
“I have never been offered a job by a poor person.” – Neal Boortz
 
“MAGA – the initials of the four largest corporations in America – Microsoft, Apple, Google, & Amazon, signifying the importance of corporations in America.” – Trish Regan on FBN
 
Despite the unprecedented American history of prosperity brought about by limited government, personal responsibility, & free enterprise plainly expressed in the above quotations, all of the major Democrat presidential primary candidates have declared a war of hatred on business & specifically on corporations & the rich – which sooner or later will be defined down to mean virtually all of the readers of this blog – no matter their political affiliation.  Democrats have a fundamental contempt for businesses & successful people – except, of course, they don’t mention that all of their presidential primary candidates, except Mayor Pete, are millionaires & Tom Steyer & Bloomy are billionaires. 
 
Never mind that there are over 150 million people employed by corporations & that almost three quarters of the value of domestically held stocks is owned by pension plans, 401(k)s & IRAs, or held by life insurance companies to fund annuities or death benefits – sources BLS on employment & Phil Gramm & Mike Salon on stocks.  In short, people are well invested in corporations who are our employers – not our enemies.
 
We can understand the attacks by all of the the Democrat presidential primary candidates against President Trump because these people are all vying for the same top spot.  But it is the mania, obsession, fixation, & preoccupation with Trump that all of these Democrat presidential candidates constantly rage in unison with the entire Democrat party & the hostile anti-American media that tells the tale – namely, that the socialist government dependent lifestyle they have planned for you grows dimmer with every Trump success.
 
The headline U-3 unemployment rate has been @ a 50 year low of 3.5% for many months; the broader U-6 unemployment/underemployment rate of 6.7% in December is the lowest in over 20 years; & women, blacks, Hispanics, Asians, & high school drop outs all have unemployment rates @ or near all time lows. 
 
This record low unemployment data under Trump policies & practices is not good news for Democrats peddling government dependence because people who have been economically lost for years are participating in the dignity of work supporting themselves.  The number of discouraged workers in December decreased by 98,000 from a year ago – a decrease of 26%.  Discouraged workers are defined by the Labor Department as persons not currently looking for work because they believe no jobs are available for them – how great for these 98,000 people to find work.
 
This is not to say that all of these previously discouraged workers found jobs that would support a family – but they have gone from months or years of hopelessness, despair, & government dependence to the dignity of having a chance to earn something to live on themselves.  The first step for them is to live within their means & then demonstrate a positive attitude toward their job & company followed by getting training to move to a better paying position within the firm - then start a family.
 
The remaining discouraged workers, as well as those marginally attached to the labor force & the persisting unemployed, can also take heart because there still is over one million more job openings than people unemployed – job openings are a level of labor demand.  This has been the case since March 2018 when the job openings & hires graph virtually went straight up as a result of the Trump tax cuts under the Tax Cuts & Jobs Act of 2017 enacted on December 22, 2017 – just three months before the number of jobs openings took off.  See green line on graphic below.


But employers need better trained people & this is holding back economic growth & its commensurate rise in prosperity, productivity growth, & additional wealth creation.  See graphic below.


In this regard Ivanka Trump has concentrated her efforts to create more opportunities for American workers following her father’s Executive Order that established the president’s national council for the American worker that recognized America is facing a skills crisis.  Ivanka, along with people like Apple CEO Tim Cook, has focused her work on companies & trade groups throughout the country to sign a Pledge To America's Workers committing to expand programs that educate, train, & reskill American workers from high school age to near retirement.  
 
Ivanka says “there are plenty of occupations that will require advanced degrees . . . But cyber security, I.T., a lot of these different programs require a credential that is achievable without racking up enormous amounts of student debt.”  Over 25 years ago I knew technicians who got computer training @ work & obtained the credential Ivanka described that met many of a company’s I.T. needs thereby promoting these technicians to a higher level of earnings.  It worked then with a company that was way ahead of its time so there is no reason it should not work again. 
 
So far over 400 companies & organizations have signed the Pledge contributing to over 12 million new education & training opportunities for American students & workers over the next five years.  Click here to hear Maria Bartiromo interview Ivanka & IBM President Ginni Rometty on FBN in Davos Switzerland regarding this education & training initiative.
 
In addition to the record low unemployment statistics summarized above, the Bureau of Labor Statistics reports the following differences in median weekly earnings comparing the first eleven quarters of the Trump administration to BO’s second term.  


Previously, the above type of positive economic statistics would ensure the reelection of an incumbent president.  But there are other important factors in play in this 2020 presidential election year.  Youthful voters are not focusing on Trump’s positive economic accomplishments & neither are older generations to some degree.  One third of Democrat primary or caucus voters say climate change is the single issue that will determine their vote & 64% of Democrats are more positive about socialism than capitalism according to a Cato Institute study which explains why Bernie Sanders took the lead in a WSJ/NBC News poll of national Democrat primary voters conducted January 26 to 29.  See graphic below.


Millennials (27.3%) & members of Generation Z (10.2%) are projected to make up 37.5% of the 2020 electorate & for many of these young people gainful employment & its commensurate wealth creation & improved standard of living are not high on their list of voting priorities.
 
Generation Z is interested in mass shootings, racial equality, & immigration policy & treatment of immigrants.  Millennials are interested in healthcare, global warming/climate change, & mass shootings.  Generation X & older generations are interested in healthcare, terrorism/national security, & the national debt. 
 
And more broadly, Americans under the age of 50, which makes up the majority of people considered to be in their prime working years (25 to 54), place no where near the same importance or significance on patriotism, religion, & having children than people did twenty years ago.  Accordingly, additional pro-growth economic measures, including middle class income tax cuts that Trump talks about, mean very little or nothing to these people compared to continuing or expanding government dependent entitlement programs – the theme of the major Democrat presidential candidates.
 
Of course, all of the above changes in attitude from the free enterprise capitalistic system America was founded on to the failed socialist system being taught & brainwashed today in our K-12 schools & universities explains it all – these young people, superficially free bird spirits, have been taught to love government dependent programs & that could have a big affect on the 2020 presidential election & the rest of their lives & everyone else’s.