No matter how the markets open today (Dow futures are up 170 right now), it is no better than a flip of a coin. Nothing is yet real nor is it likely to become real anytime in the near future.
These sham negotiations have taken the country to the brink; all in the name of special interests over the interests of the Republic. Just because all parties are “unhappy” with the compromise doesn’t mean this is a heroic agreement. Consensus seldom breeds innovation and genius is not born from “shared sacrifices”. This process has been and is shameful. 536 career politicians cannot look beyond constituencies and 2012 to do their jobs as elected representatives.
This “plan” (as of Sunday night at 9pm) consists of $1T in cuts so back loaded into the 10-year cycle that they have a virtually insignificant net present value as well as about $1.4T in cuts to be named by a to be named committee.
We currently have nearly $15T of national debt. That is about 7 times the taxes the federal government takes from all sources. This bill will raise that number to more than $17T by the 2012 election! This will be 8 times all taxes. And, much to the displeasure of our progressive friends, raising taxes now would be suicidal. It is not as though our rates are low or $2.2T in revenue won’t run the country.
May I remind any progressives that $2.2T in taxes did run the country…just 3 years ago in 2008!
After watching the despicable acts of the big three credit rating agencies during the mortgage collapse debacle, I could care less who they rate and how they rate them. They should have been put out of business three years ago. This, however, does not change the fact that they will downgrade American debt…and rightly so. We deserved to be downgraded years ago but we got a pass just like commercial and investment banks…and AIG (more on the unheralded criminals that emerged from the 2008 collapse later this week).
Our folks in Washington would not have needed to build in “triggers” in this legislation to invoke “painful” cuts if they had addressed these obscene deficits and debt years ago.
Never once have they put their retirements and salaries on the line as we do everyday.
Never once do they correctly distinguish between entitlement programs that have been funded (though not fully funded) by mandatory payroll deductions from our paychecks and welfare programs for people, including illegal immigrants, who have contributed nothing yet who continue to be a burden to our society.
Never once do they address the absolute critical mission of our military and that is keeping us alive and safe. The military’s mission should not be nation building. The only thing that separates us from being just another broke, third world dung hole is our ability to project absolute military superiority across the globe.
This may sound too jingoistic or heavy handed but world peace is a fantasy. Those who have not will always want to take from those who have and only our military stands in their way. The only way to truly have a strong dollar, assuming we overcome our abject profligacy, is to carry the biggest, baldest stick in the world and for the world to believe that we would use it.
So what did our 536 folks do? They made the military one of the trigger cuts. Should agreement not be reached on future cuts, the military and Medicare take a huge hit.
In the name of “compromise”, we will continue to fund entire departments that should be eliminated.
In the name of “compromise”, we will put a band-aid on Social Security and Medicare yet continue to pay benefits to non-contributors, means-test recipients and offer no privatization option. By the way, Chile has quite successfully privatized its retirement programs, should anyone suggest that it couldn’t be done.
There has been no discussion about the massive burden of ObamaCare…has anyone even commented on that?
And, since the bill will be ramrodded through in the dark of the night, what legislative and regulative surprises do we face? What additional freedoms will we now forgo? What new costs will we bear to spend our own after-tax dollars?
Solutions to our debt problem are not difficult. Each of you could do it with a line item veto, a little economic and financial training and no desire to stand for re-election. It is no harder than balancing your family’s finances but with just a few more zeros.
You certainly would not lie to the American people and tell them that they must continue to contribute to a broken system while you “transfer” their wealth to social non-contributors. You would not support nation building when our country needs help first. You would not unilaterally disarm yourself. You would not prohibit energy resource exploration and drive up costs.
You would not do any of this so why vote for politicians who do?
No matter what agreement is or is not reached this week, our debt will still be huge and out of control. Our politicians won’t address it again until after the election. Our debt will be downgraded and our interest rates will rise. Our unemployment will remain at hugely painful levels. Our liberties will continue to be abridged.
Until we elect statesmen and hold them accountable, this process will not change.
By the way, those of you holding precious metals don’t be surprised if they bounce around in the short term. But never have I been more concerned about our dollar nor our debt or country and never have I been more optimistic about precious metals.