Rudderless

America is suffering a leadership vacuum in debt crisis

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People around the world might be horrified if they really knew the extent of the leadership vacuum in the most powerful nation on Earth.

The void can be observed in a number of areas, but is most noticeable, and most ominous, in America's debt crisis.

The Congressional Budget Office last week warned that the national debt is on pace to be bigger than the gross domestic product -- the value of what we produce in a year. In fact, the debt could someday be double the size of the nation's economy.

"Most ominously," writes the Associated Press, "the report warned of a 'sudden fiscal crisis' in which investors would lose faith in the United States government's ability to manage its fiscal affairs. In such a fiscal panic, investors might abandon United States bonds and force the government to pay unaffordable interest rates.

"At that point, it warned, policymakers would have to win back the confidence of the markets by imposing spending cuts and tax increases far more severe than if they were to act now."

Absent from the news story and the CBO report is the pertinent little nugget that racking up a debt that surpasses World War II's burden is an immoral blow against future generations by a nation that has somehow become much less stout than its reputation.

It's our young who are likely to be in the streets if, as the CBO report warns, the fiscal crisis leads to a "European-style crisis."

With an economy that is already battered by an incessant housing recession, chronic high unemployment and a financial and business community wary of Washington's next move, the nation's looming debt crisis is a storm cloud over already rain-soaked ground.

America is paralyzed today by a lack of certitude and a dearth of courage. None of us can be certain what taxes and regulations and restrictions Washington will drop in our laps, because few in the nation's capital are courageous enough to do what's necessary.

The first step is to drastically reduce federal spending. Then we need to know what the rules will be going forward: The new health-care law, Dodd-Frank financial regulations, EPA plans to regulate carbon emissions, Democrat urges to tax the wealthy -- these woeful children of the Washington bureaucracy are both overly demanding and utterly unpredictable.

Uncertainty, much of it due to the vagaries of a vague Washington, is killing the economy, says Carnegie Mellon professor Allan Meltzer.

"You just don't know from day to day what the administration is going to come up with next," he said in a recent video interview. "The sensible thing to do is hold onto your cash and don't invest it."

Meanwhile, so-called leaders in Washington can't agree on even a modest $2 trillion cut over 10 years. Indeed, key GOP negotiators left bipartisan talks over the budget late last week after the group led by Vice President Joe Biden reached an impasse. It seems Democrats insist on higher taxes and more spending.

Headed for the cliff, Democrats want us to press down on the accelerator.

Moreover, they want to let Republicans suggest cuts in entitlement spending -- as the CBO says will be absolutely required to get the budget under control -- so they can scare Americans and perhaps make gains in next year's elections.

This is a group -- congressional Democrats -- who failed to write a budget last year or approve one this year.

Where is the Democratic plan for budget sanity? For cutting future entitlements, as every expert says must be done?

Moreover, where is the president? He says the economy is Job 1, but sends surrogates to deal with it.

As for Democrats building their Alamo out of higher taxes, how wrong can that be? Just when the private economy needs an infusion of cash, they want to take more out of it?

We've let this problem go on so long, and get so bad, that higher taxes may have to be part of the solution down the road. Now is not the time. It shouldn't be an option unless and until substantial cuts are made in federal spending. And if taxes are raised down the road, the split between spending cuts and higher taxes ought to be something close to 90 to 10.

For now, it's suicidal to entertain either higher taxes or more spending.

Where's the leadership?

For instance: Was anyone else slack-jawed at Federal Reserve Chairman Ben Bernanke's assertion that he just didn't see this slow-moving economy coming? What world is he living in?

Whatever it is, don't tell the rest of this world. They don't need to know how rudderless we are.

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faithson
5158
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faithson 06/26/11 - 01:14 am
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So it's all the Democrats

So it's all the Democrats Fault, at least according to the zealots on the AC editorial board. Just shows us how 'simple' minded Mr. Ryan and his cronies are. ' Lies are often much more plausible, more appealing to reason, than reality, since the liar has the great advantage of knowing beforehand what the audience wishes or expects to hear.' Tell them what they want to hear Mr. Ryan, tell them all about it.

kissofdeath
413
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kissofdeath 06/26/11 - 06:10 am
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I'd like you to take a close

I'd like you to take a close look at your phone company,and ask yourself this:Did my phone company help send the Tea Paty to Washington?

If you're with AT&T OR VERIZON Wireless, you should know that AT&T contributed a whopping $386,000, while Verizon gave$35,500, to House Tea Party Caucus members in the 2010 election cycle.What's more,both companies supported Tea Party - backed Senators Rand Paul, Marco Rubio, Mike Lee, and Pat Toomey.

The Tea Party politicians have launched radical legislation, including dangerous ideas like redefining rape, defunding EPA, dismantling the Department of Education, and more.

So make the switch to another wireless provider. And yes, you'll know that your new phone is fighting the Tea Party's agenda in Washington.

justthefacts
21850
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justthefacts 06/26/11 - 06:33 am
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Well, I at least feel better

Well, I at least feel better about my AT&T bill now.

hirg_cola
0
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hirg_cola 06/26/11 - 06:47 am
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kissofdeath, thanks for the

kissofdeath, thanks for the information. I was thinking about leaving AT&T next month but I may rethink that now that I know they backed the Tea Party. Tell me again why the Department of Education shouldn't be dismantled?

Rhetor
1010
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Rhetor 06/26/11 - 07:14 am
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The Democrats have actually

The Democrats have actually cut taxes several times and America's tax burden is now less than it has ever been in my long lifetime. The Democrats have stuck to a no-earmarks pledge in the face of stiff Republican efforts to pass earmarks. (Boehner signed onto the no-earmarks bandwagon and then immediately spoke for a needless second F-35 engine to be built in his home district. Our own Sen. Graham is an earmark king.) The budget impasse is founded first and foremost on:1. The Republicans and some Dems insist on continuing huge subsidies for big oil and agribusiness and 2. The Dems want the super-rich to pay their fair share of taxes. No one is talking about returning to the very high rates for high income citizens such as in the Clinton years--just that they should help to support the country that makes their wealth possible. Thus, I question this editorial's interpretation of the basic facts.

justthefacts
21850
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justthefacts 06/26/11 - 07:39 am
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Democrats aren’t happy about

Democrats aren’t happy about it, even if they know they have little chance of winning the fight.
“With Republican opposition and the president opposed to it, it’s very unlikely that it will happen,” said Sen. Mary Landrieu (D-La.), one of the Senate’s biggest earmarkers. “But I think it’s very short-sighted policy, and it’s going to be very hurtful to Louisiana and a lot of states.”
Sen. Ben Nelson (D-Neb.) said that if the Senate doesn’t earmark money for their projects, they’re not going to allow the president to spend the money in areas that he prefers.

seenitB4
87233
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seenitB4 06/26/11 - 09:23 am
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It's coming folks---while we

It's coming folks---while we play the fiddle...lalalalland

Riverman1
83931
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Riverman1 06/26/11 - 09:46 am
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Never fear, we may soon have

Never fear, we may soon have a "strong" voice at the budget table. Nancy Pelosi is demanding to be included in the final talks on the national debt. Feel better now?

Riverman1
83931
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Riverman1 06/26/11 - 09:49 am
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Anyone see where the Director

Anyone see where the Director of the CBO was asked to comment on Obama's speech on lowering the debt? The CBO director said his office couldn't evaluate speeches, but only hard proposals....such as what Cantor presented.

hounddog
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hounddog 06/26/11 - 10:01 am
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‘If you're with AT&T OR
Unpublished

‘If you're with AT&T OR VERIZON Wireless, you should know that AT&T contributed a whopping $386,000, while Verizon gave$35,500, to House Tea Party Caucus members in the 2010 election cycle.’
Thanks for the information. But I already knew I receive emails from the racist organization called the ColorOfChange. The ColorOfChange is protesting AT&T buying T-Mobile. They say because it will increase poor blacks phone bill but that is a lie. You posted why they are against AT&T.
So folks keep right on supporting AT&T and Verizon.

rmwhitley
5547
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rmwhitley 06/26/11 - 10:31 am
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Y'all crack me up! A Harley
Unpublished

Y'all crack me up! A Harley biker is riding by the zoo in Washington, DC when he sees a little girl leaning into the lion's cage. Suddenly, the lion grabs her by the cuff of her jacket and tries to pull her inside to slaughter her, under the eyes of her screaming parents. The biker jumps off his Harlery, runs to the cage and hits the lion square on the nose with a powerful punch.Whimpering from the pain the lion jumps back letting go of the girl, and the biker brings her to her terrified parents who thank him endlessly. A reporter has watched the whole event. The reporter addressing the Harley rider says, "Sir, this was the most gallant and brave thing I've seen a man do in my whole life." The Harley rider replies, "Why, it was nothing, really, the lion was behind bars. I just saw this little kid in danger and acted as I felt right." The reporter says, "Well, I'll make sure this won't go unnoticed. I'm a journalist, and tomorrow's paper will have this story on the front page....... So what do you do for a living and what political affiliation do you have?" The biker replies, "I'm a U.S. Marine and a Republican." The journalist leaves. The following morning the biker buys the paper to see news of his actions, and reads, on the front page:U.S. MARINE ASSAULTS AFRICAN IMMIGRANT AND STEALS HIS LUNCH. That pretty much sums up the mainstream media's approach to the news these days.

allhans
23645
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allhans 06/26/11 - 10:33 am
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Obama will continue to

Obama will continue to straddle the line and will refuse to take control so that he can blame Republicans if things go wrong. With him what you see is not what you get, he is
an elusive, slick cookie and it will be hard if not next to impossible to get him to start making hard proposals now.

Insider Information
4009
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Insider Information 06/26/11 - 10:50 am
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Think of a key issue over the

Think of a key issue over the past two years and ask yourself where the leadership was...

- President Obama appointed Joe Beiden to oversee the stimulus. That went well.

- President Obama refused to offer a healthcare bill to Congress. "Just send me a bill and a I will sign it."

- President Obama tapped Beiden to hold debt talks. The next day, he left the country.

I see a well worn path to the golf course.

paulbaughman28
215
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paulbaughman28 06/26/11 - 11:45 am
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My 10 year-old saw this

My 10 year-old saw this recession coming

robaroo
750
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robaroo 06/26/11 - 02:31 pm
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Another cheap shot editorial

Another cheap shot editorial from the AC, giving the Republicans a pass for their share of the blame.

Personally, I prefer having more spending cuts than tax increases. But it's going to take both to get the budget where it needs to be.

At least the Republicans are making noise about reducing the deficit now. If they are serious, they will reluctantly agree to some tax increases along with the spending cuts.

It appears the Republicans are no more serious about cutting the deficit than the Democrats. All they want to do is score political points by pretending. So we're back where we started. Two corrupt parties run the country, completely sold out to their various special interest groups. When will get a party that actually cares about America?

Chillen
17
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Chillen 06/26/11 - 04:06 pm
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Our federal govt should be

Our federal govt should be reduced to three things: maintaining a small but effective military (not world policemen), developing & maintaining basic infrastructure and enforcing minimal federal laws (NOT regulations).

All other functions should be turned over to the states. Then they can function as free or liberal as the state citizens request. Go live in Kalifornia if you want communist utopia.

Until this happens, you folks better be investing in gold, silver, land & food. You should have a sizeable garden now for practice so you know how to grow your own food.

Don't count on your pensions, free govt healthcare, welfare, etc. Our govt is failing us and going bankrupt. The decline began a few years ago and obummer made it infinitely worse by spending us into oblivion and rewarding his pals with the "fruits of our labor".

An exit route from this madness is rapidly closing. It's about the size of a pinhole. Unless American citizens find it, we are looking at a widespread depression.

faithson
5158
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faithson 06/26/11 - 04:56 pm
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@chillen, a depression

@chillen, a depression brought on by intransigent politicians on both sides who's only goal is re-election.

Chillen
17
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Chillen 06/26/11 - 05:34 pm
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Forgot to mention that you

Forgot to mention that you should also have a way to defend yourself, otherwise you are a sitting duck.

Read these stories if you don't believe me.

South Carolina
http://www.dailymail.co.uk/news/article-2008252/Teenage-gang-charged-lyn...

Illinois
http://webcache.googleusercontent.com/search?q=cache:lHzJ2PFQcMEJ:peoria...

Pennsylvania
http://www.delcotimes.com/articles/2011/06/26/news/doc4e0696aaf127f552097776.txt?nstrack=sid:3501255|met:300|cat:0|order:1

Certain segments of our Youth & Teens are out of control. The riots & crime are just beginning. We have a huge problem brewing in America. They are broke & out of work with plenty of time on their hands. And they want what YOU have.

Chillen
17
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Chillen 06/26/11 - 05:36 pm
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The above Pennsylvania web

The above Pennsylvania web address works but for some reason the auto link isn't working. I've tried it twice. Sorry, you'll have to cut & paste it but it will be worth the look.

seenitB4
87233
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seenitB4 06/26/11 - 05:40 pm
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I agree chillen....scary

I agree chillen....scary times are ahead....get ready fot it.

RonRoberts
66
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RonRoberts 06/26/11 - 06:12 pm
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Now here's some irony... you

Now here's some irony... you write "As for Democrats building their Alamo out of higher taxes, how wrong can that be? Just when the private economy needs an infusion of cash, they want to take more out of it?"

Private enterprise is profiting quite nicely, thank you; American CEO's average take-home pay is it a record high - as is the disparity in income between said CEO's and their middle-class employees. Their taxes are at an all-time low, as is the corporate rate, and yet they. aren't. SPENDING. So somebody HAS to. Build and repair our infrastructure, and construction jobs get filled and our great nation's foundation and her frame gets strengthened for future generations.

I can't help but notice there's no blame to be laid at the feet of the GOP, in this entire piece, but I don't see Iraq, Afghanistan or the unfunded prescription drug bill mentioned as culprits, nor is it ONCE mentioned that the tax rate on the wealthiest of wealthy Americans has dropped precipitously since Ronald Reagan was in office - a time when our economy was humming, but was was our deficit spending.

How do we rationalize somebody bringing $1 billion in take-home pay having the same tax rate as a family bringing in $250,000? It's ABSURD and unfair on top of that.

The GOP solution to "boosting" our economy? Cutting middle-class public sector jobs, of course; yes, let's put MORE people (don't forget, they're PEOPLE) out of work and on the 16-week countdown to making and spending nothing. For those 16 weeks, they'll get an unemployment check that's far less than what they were earning, so their economic impact will be muted, before, after said 16 weeks, they'll get nothing and spend nothing. That's GREAT for the economy, right?

Don't be fooled, people; the GOP WANTS the economy to struggle; it's in their political best interest. Leading economists will tell you that a recovery from this recession would be a slow crawl and not a boom; that's because a divided Washington gave us too LITTLE a stimulus and now the GOP is doing its dead-level best to sabotage what sluggish recovery we've had with this drumbeat about our deficit.

You're right when you use the words "wrong time;" where you're wrong is - it's the "wrong time" to be sweating middle class public sector job cuts.

You want to cut federal spending? Fine; let's do that.

Let's NOT spend 10x as much as the rest of the world on our military. Let's trim it to, say, 7x as much as the rest of the world. Secretary of Defense Bill Gates OFFERED to trim $750 billion and "pork-loving" Congressional members couldn't stomach those cuts hitting their districts.

Let's NOT give away over $20 billion in tax breaks to the oil companies that have helped to weaken our economy with $3.50 and higher gas by the gallon prices. They report RECORD profits and we pay RECORD prices while the government gives them RECORD tax breaks? Ridiculous.

Let's DO let Medicare negotiate for lower drug prices, for crying out loud. Doing so could save the government $15.5 billion a year.

Let's DO enact a financial transactions tax. Such a tax would do nothing to lessen stock, derivatives, bond purchase and other Wall Street moves, but would bring in an estimated $50-150 billion annually.

Let's STOP handing out subsidies to big agriculture; we hand out $16.7 billion annually to these massive agricultural corporations that apparently aren't profitable on their own - and this is BEFORE we even bring up taxes, folks. It's corporate WELFARE (I know how you righties hate welfare). Just 10% of America's largest and richest farms get 75% of these subsidies.

No, instead, we cut cops, teachers, firemen, and their support staff and other low-level and middle class public sector jobs, and we threaten to voucherize Medicare for those 55 and under (because we know the 30 and under crowd doesn't vote so screw THEM over). Let the poor and the middle class pay the price while the wealthy feel no pinch at all. Pathetic thinking.

rmwhitley
5547
Points
rmwhitley 06/26/11 - 07:18 pm
0
0
$787,000,000,000 went into
Unpublished

$787,000,000,000 went into the economy, $0 came out alive. You go obama , "osama bin" biden, harry, nancy and frankie.

Riverman1
83931
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Riverman1 06/26/11 - 07:51 pm
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Ron Roberts said, "How do we

Ron Roberts said, "How do we rationalize somebody bringing $1 billion in take-home pay having the same tax rate as a family bringing in $250,000? It's ABSURD and unfair on top of that."

Let's say they are both actually paying 20 percent in taxes. Do you realize the guy making a billion pays 200 million a year in taxes to simply drive down the highway and breathe the air? The guy making 250 grand will be paying 50 thousand for the same privilege. Take that further and realize almost half the population pays nothing. The billionaire is more than paying his share.

faithson
5158
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faithson 06/26/11 - 08:26 pm
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Alan Greenspan even supports

Alan Greenspan even supports allowing the Bush tax cuts to end. A man whom most republicans admired. But I guess that was then and this is now... run the train off the rails for the good of the riders, It is irrational to not allow revenue enhancement along with spending cuts. But who ever said the conservative fringe were rational. Drinking that tea party kool aid reminds me of all those people who thought 'Jim Jones's' beverage was an answer.

Riverman1
83931
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Riverman1 06/26/11 - 09:33 pm
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" revenue enhancement " LOL

" revenue enhancement " LOL

RonRoberts
66
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RonRoberts 06/27/11 - 04:16 pm
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Riverman, that billionaire

Riverman, that billionaire has more to defend, tends to live in a more exclusive (and further away from city center) neighborhoods unless he/she lives on his/her own compound further out of the city center (thus taxing our infrastructure needs by having to stretch them further out to them, as well as police and fire), tends to use the publicly subsidized airport(s) and port terminals more than most because he/she can travel far more than a poor, middle class or even above-middle class American can; said billionaire sits his/her rump in a suite to watch concerts, pro sports teams, etc., at (usually) publicly-built stadiums and arenas, whereas the average working man can't afford a SINGLE game with the "family of four" to one single event, these days. The wealthy benefit more and SHOULD pay more.

justthefacts
21850
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justthefacts 06/27/11 - 05:34 pm
0
0
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