Posts Tagged With: debt


I received the following from a reader. The author has signed his name at the bottom of the letter. He has done this country a service for writing it. The least I can do is pass it on.

If you know this gentleman, please thank him for me.

April 3, 2013Senator Patty Murray
Senator Maria Cantwell
Washington, DC, 20510Dear Senator:
I have tried to live by the rules my entire life. My father was a Sergeant Major, U.S. Army, who died of combat related stresses shortly after his retirement. It was he who instilled in me those virtues he felt important – honesty, duty, patriotism and obeying the laws of God and of our various governments. I have served my country, paid my taxes, worked hard, volunteered and donated my fair share of money, time and artifacts.

Today, as I approach my 79th birthday, I am heart-broken when I look at my country and my government. I shall only point out a very few things abysmally wrong which you can multiply by a thousand fold. I have calculated that all the money I have paid in income taxes my entire life cannot even keep the Senate barbershop open for one year! Only Heaven and a few tight-lipped actuarial types know what the Senate dining room costs the taxpayers. So please, enjoy your haircuts and meals on us.

Last year, the president spent an estimated 1.4 $billion on himself and his family. The vice president spends $millions on hotels. They have had 8 vacations so far this year! And our House of Representatives and Senate have become America’s answer to the Saudi royal family. You have become the “perfumed princes and princesses” of our country.

In the middle of the night, you voted in the Affordable Health Care Act, a.k.a. “Obama Care,” a bill which no more than a handful of senators or representatives read more than several paragraphs, crammed it down our throats, and then promptly exempted yourselves from it substituting your own taxpayer-subsidized golden health care insurance.

You live exceedingly well, eat and drink as well as the “one percenters,” consistently vote yourselves perks and pay raises while making 3.5 times the average U.S. individual income, and give up nothing while you (as well as the president and veep) ask us to sacrifice due to sequestration (for which, of course, you plan to blame the Republicans, anyway).

You understand very well the only two rules you need to know – (1) How to get elected, and (2) How to get re-elected. And you do this with the aid of an eagerly willing and partisan press, speeches permeated with a certain economy of truth, and by buying the votes of the greedy, the ill-informed and under-educated citizens (and non-citizens, too, many of whom do vote) who are looking for a handout rather than a job. Your so-called “safety net” has become a hammock for the lazy. And, what is it now, about 49 or 50 million on food stamps – pretty much all Democrat voters – and the program is absolutely rife with fraud with absolutely no congressional oversight?

I would offer that you are not entirely to blame. What changed you is the seductive environment of power in which you have immersed yourselves. It is the nature of both houses of Congress which requires you to subordinate your virtue in order to get anything done until you have achieved a leadership role. To paraphrase President Reagan, it appears that the second oldest profession (politics), bears a remarkably strong resemblance to the oldest.

As the hirsute first Baron John Emerich Edward Dalberg Acton (1834 – 1902), English historian and moralist, so aptly and accurately stated, “Power tends to corrupt, and absolute power corrupts absolutely. Great men are almost always bad men.” I’m only guessing that this applies to the female sex as well. Tell me, is there a more corrupt entity in this country than Congress?

While we middle class people continue to struggle, our government becomes less and less transparent, more and more bureaucratic, and ever so much more dictatorial, using Czars and Secretaries to tell us (just to mention a very few) what kind of light bulbs we must purchase, how much soda or hamburgers we can eat, what cars we can drive, gasoline to use, and what health care we must buy. Countless thousands of pages of regulations strangle our businesses costing the consumer more and more every day.

As I face my final year, or so, with cancer, my president and my government tell me “You’ll just have to take a pill,” while you, Senator, your colleagues, the president, and other exulted government officials and their families will get the best possible health care on our tax dollars until you are called home by your Creator while also enjoying a retirement beyond my wildest dreams, which of course, you voted for yourselves and we pay for.

The chances of you reading this letter are practically zero as your staff will not pass it on, but with a little luck, a form letter response might be generated by them with an auto signature applied, hoping we will believe that you, our senator or representative, has heard us and actually cares. This letter will, however, go on line where many others will have the chance to read one person’s opinion, rightly or wrongly, about this government, its administration and its senators and representatives.

I only hope that occasionally you might quietly thank the taxpayer for all the generous entitlements which you have voted yourselves, for which, by law, we must pay, unless, of course, it just goes on the $17 trillion national debt for which your children and ours, and your grandchildren and ours, ad infinitum, must eventually try to pick up the tab.

My final thoughts are that it must take a person who has either lost his or her soul, or conscience, or both, to seek re-election and continue to destroy this country I deeply love and put it so far in debt that we will never pay it off while your lot improves by the minute, because of your power. For you, Senator, will never stand up to the rascals in your House who constantly deceive the American people. And that, my dear Senator, is how power has corrupted you and the entire Congress. The only answer to clean up this cesspool is term limits. This, of course, will kill the goose that lays your golden eggs. And woe be to him (or her) who would dare to bring it up.


Bill Schoonover

3096 Angela Lane

Oak Harbor, WA 98277

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America’s Real Contribution to U.N. Is Unknown……

How much money does the United States currently contribute to the United Nations and its various agencies? Surprisingly, no one knows for sure.
The State Department does report on its spending at the United Nations, but it is only one of several federal agencies that give money to the world body each year.
In its fiscal 2014 State and Foreign Operations budget proposal released in April, the Obama administration asked for $1.57 billion for contributions to international organizations, including $617.6 million for the U.N. operating budget — up from $568.8 million in fiscal 2012.
But other agencies giving to the U.N. include the Departments of Labor, Energy, Agriculture, Defense, and Health and Human Services, CNS News reported.
Fiscal 2007 legislation stipulated that the Office of Budget and Management (OMB) report all federal agencies’ contributions, but the requirement expired in 2011.
Now Republican Sens. Mike Enzi of Wyoming and Mike Lee of Utah, and others, are submitting legislation that would reinstate the requirement.
“It’s disturbing that no one, including our ambassador to the United Nations, knows exactly how much money we send the U.N. every year,” Enzi said in a statement.
“With a national debt exceeding $17 trillion, we need to be able to account for every dime we spend, including what we send to the U.N.”
The last OMB report to Congress on U.N. contributions was issued in June 2011 and covered fiscal 2010. It showed that State was just one of 17 government agencies giving money to U.N. organizations, funds, affiliates and other bodies, and the total expenditure that year was $7.69 billion — more than 10 times the amount requested for State in fiscal 2014.
In addition to the billions being contributed to various bodies within the U.N. system, the United States provides 22 percent of the U.N.’s operating budget, more than twice as much as the No. 2 contributor, Japan (10.8 percent).
Other legislation likely to be introduced in Congress would change the way the United Nations is funded, allowing the United States to fund only those activities and agencies that are “efficient and in the national interest,” according to CNS News.
As the Insider Report disclosed earlier, the United States did cut off funding for the U.N. Educational, Scientific and Cultural Organization (UNESCO) after it voted in October 2011 to approve the Palestinian Authority’s full membership in the agency. But that move was required by U.S. laws.

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Cracking the 2013 Tax Code……. A guide to the changes wrought by the fiscal-cliff deal

Early in the morning of January 1, Congress finally got around to dealing with the tax part of the fiscal cliff drama by passing what is inaccurately named the American Taxpayer Relief Act of 2012. Thanks to the demise of the so-called payroll tax holiday, all workers will pay higher taxes this year, but the new law cancels federal income tax increases that would have resulted in added misery for just about everyone. The bad news is that higher-income folks will face higher rates.
Here’s a detailed summary of the most important changes for individual taxpayers.
Payroll Tax Holiday Is Dead
For 2010-2012, the Social Security tax withholding rate on your salary was temporarily reduced from the normal 6.2% to 4.2%. If you’re self-employed, the Social Security tax component of the self-employment tax was reduced from the normal 12.4% to 10.4%. Last year, this so-called payroll tax holiday could have saved one person up to $2,202 or a working couple up to $4,404. Somewhat surprisingly, the new law does not extend the holiday through 2013. (For this year, the Social Security tax can hit up to $113,700 of salary or self-employment income.)
Rates on Ordinary Income: For most individuals, the federal income tax rates for 2013 will be the same as last year: 10%, 15%, 25%, 28%, 33%, and 35%. However, the maximum rate for higher-income folks increases to 39.6% (up from 35%). This change only affects singles with taxable income above $400,000, married joint-filing couples with income above $450,000, heads of households with income above $425,000, and married individuals who file separate returns with income above $225,000.
Rates on Long-Term Gains and Dividends: The tax rates on long-term capital gains and dividends will also remain the same as last year for most individuals. However, the maximum rate for higher-income folks increases to 20% (up from 15%). This change only affects singles with taxable income above $400,000, married joint-filing couples with income above $450,000, heads of households with income above $425,000, and married individuals who file separate returns with income above $225,000. Remember: these higher-income folks can also get socked with the new 3.8% Medicare surtax on investment income, which can result in a maximum 23.8% federal tax rate on long-term gains and dividends.
Personal and Dependent Exemption Deduction Phase-Out: The last time we saw a phase-out rule for personal and dependent exemption deductions was 2009. Sadly, the phase-out deal is back. As a result, your personal and dependent exemption write-offs can be reduced or even completely eliminated. Phase-out starts at the following adjusted gross income (AGI) thresholds: $250,000 for single filers, $300,000 for married joint-filing couples, $275,000 for heads of households, and $150,000 for married individuals who file separate returns.
Itemized Deduction Phase-Out: The last time we saw a phase-out rule for itemized deductions was also in 2009. Unfortunately, this phase-our provision is back too. As a result, you can potentially lose up to 80% of your write-offs for mortgage interest, state and local income and property taxes, and charitable contributions if your AGI exceeds the applicable threshold. The thresholds are $250,000 for single filers, $300,000 for married joint-filing couples, $275,000 for heads of households, or $150,000 for married individuals who file separate returns. More specifically, the total amount of your affected itemized deductions is reduced by 3% of the amount by which your AGI exceeds the threshold. However, the reduction cannot exceed 80% of the total affected deductions that you started off with.
Key Point: All the aforementioned changes are permanent, so we at least have the illusion of tax-regime stability — until further notice.
Alternative Minimum Tax Patch Made Permanent
It had become an annual ritual for Congress to “patch” the AMT rules to prevent millions more households from getting socked with this add-on tax. The patch job consisted of allowing bigger AMT exemptions and allowing various personal tax credits to offset the AMT. Amazingly, the new law makes the patch permanent, starting with 2012. The change will keep about 30 million households out of the dreaded AMT zone.
Relatively Favorable Gift and Estate Tax Rules Made Permanent
For 2013 and beyond, the new law permanently installs a unified federal estate and gift tax exemption of $5 million (adjusted annually for inflation) and a 40% maximum tax rate (up from last year’s 35% rate). The right to leave your unused estate and gift tax exemption to your surviving spouse (the so-called exemption portability deal) was also made permanent.
Child Tax Credit Extended
The $1,000 maximum credit for each eligible under-age-17 child was extended through 2017.
Earned Income Tax Credit Extended
Legislation enacted in previous years increased the earned income credit for families with three or more qualifying children and allowed married joint-filing couples to earn more without having their credits reduced. These changes, which help lower-income families, were extended through 2017.
American Opportunity Higher Education Tax Credit Extended
The American Opportunity credit, which can be worth up to $2,500 and can be claimed for up to four years of undergraduate education, was extended through 2017.
Higher Education Tuition Deduction Extended
This write-off, which can amount to as much as $4,000 or $2,000 for higher-income folks, expired at the end of 2011. The new law retroactively restores it for 2012 and extends it through 2013.
Option to Deduct State and Local Sales Taxes Extended
In past years, individuals who paid little or no state income taxes were given the option of instead claiming an itemized deduction for state and local sales taxes. The option expired at the end of 2011, but the new law restoratively restores it for 2012 and extends it through 2013.
Charitable Donations from IRAs Extended
In past years, IRA owners who had reached age 70½ were allowed to make charitable donations of up to $100,000 directly out of their IRAs. The donations counted as IRA required minimum distributions. So charitably inclined seniors with more IRA money than they needed could reduce their taxes by arranging for IRA donations to take the place of taxable required minimum distributions. This break expired at the end of 2011, but the new law retroactively restores it for 2012 and extends it through 2013. To take advantage of the retroactive deal, you’ll be given a window of time during the first part of this year to make donations that are treated as having been made in 2012. Stay tuned for details on that.
Tax-Free Treatment for Forgiven Principal Residence Mortgage Debt Extended
For federal income tax purposes, a forgiven debt generally counts as taxable cancellation of debt (COD) income. However a temporary exception applied to COD income from cancelled mortgage debt that was used to acquire a principal residence. Under the temporary rule, up to $2 million of COD income from principal residence acquisition debt that was cancelled in 2007-2012 was treated as a tax-free item. This generous break was extended through 2013.
$250 Deduction for K-12 Educators’ Expenses Extended
The $250 deduction for teachers and other K-12 educators for school-related expenses paid out of their own pockets was retroactively restored for 2012 and extended through 2013.
$500 Energy-Efficient Home Improvement Credit Extended
In past years, taxpayers could claim a tax credit of up to $500 for certain energy-saving improvements to a principal residence. This break expired at the end of 2011, but the new law retroactively restores it for 2012 and extends it through 2013.

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Obama’s open checkbook

The country hit its $16.4 trillion debt limit December 31, and the Treasury is on track to run out of funds in February. If Congress does not raise the debt ceiling on time, the United States would default on its debt payments and roll markets worldwide.

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US To Hit $16.4T Debt Ceiling Dec. 31..

Treasury Secretary Timothy F. Geithner said his department will take “extraordinary measures” to postpone a U.S. default for about two months while President Barack Obama and Congress work out a deficit-reduction deal.
Geithner, in a letter to congressional leaders today, said the government will hit its statutory $16.4 trillion debt ceiling on Dec. 31. To avert a default, the Treasury will take action to create about $200 billion in headroom under the debt limit.

“However, given the significant uncertainty that now exists with regard to unresolved tax and spending policies for 2013, it is not possible to predict the effective duration of these measures,” Geithner said.

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Obama’s Trophy Wife…….


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US Debt to Hit $16 Trillion on Tuesday as DNC Begins….

Just as Democrats are gaveling in their convention Tuesday, the federal government likely will announce another dubious milestone — $16 trillion in total federal debt.

In an election already focused on domestic issues of jobs, spending and deficits, the $16 trillion number is likely to underscore just how much is at stake in November for both parties, which are offering dramatically different ways to begin to eat away at the deep hole.

Gross federal debt has been flirting with $16 trillion for the past two weeks, and the government ended Thursday $15.991 trillion in debt.

With several debt auctions scheduled for the end of last week, budget analysts think the government probably broached the $16 trillion number on Friday, and it will be reported to the public Tuesday, which, thanks to the Labor Day holiday, is the next business day.

While $16 trillion isn’t a tipping point, it is a stark number that Republicans said will reflect poorly on Mr. Obama, who has overseen the biggest debt explosion in the country’s history.

“This is a grim landmark for the United States,” said Sen. Jeff Sessions of Alabama, the ranking Republican on the Senate Budget Committee. “Yet the president seems strangely unconcerned.”

The Obama campaign didn’t respond to a message seeking comment on the milestone, but, speaking on “Fox News Sunday,”David Axelrod, a top adviser to Mr. Obama, said the president has a “plausible plan” to stabilize the debt, but acknowledged the plan doesn’t actually begin to reduce it.

“You can’t balance the budget in the short term because to do that would be to ratchet down the economy,” he said.

That underscores both sides’ dilemma: Republicans object to tax increases, saying they will stunt a recovery, while Democrats say reducing spending would likewise hurt.

The Congressional Budget Office last month said raising taxes or cutting spending, or both, might indeed send the economy into a recession, though the alternative — putting off fiscal tightening — means things are worse in the long term.

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Paul Ryan: My Plan to Save America

Newsmax asked vice presidential candidate Rep. Paul Ryan to provide his prescription for fixing the American economy and a defense of his proposed agenda, in light of the Obama’s administration’s refusal to address out-of-control entitlements. Here is his exclusive Newsmax Op-Ed.

When President Barack Obama took office in 2009, he assumed a degree of command over the federal government that few U.S. presidents have enjoyed. His party had just enlarged its already-large majority in the House of Representatives, and gained a filibuster-proof majority in the Senate. The president enjoyed tremendous popularity following his historic victory.

During his campaign, then-Sen. Obama argued that what had stopped us from meeting our nation’s greatest challenges had been “the failure of leadership, the smallness of our politics — the ease with which we’re distracted by the petty and trivial, our chronic avoidance of tough decisions, our preference for scoring cheap political points instead of rolling up our sleeves and building a working consensus to tackle big problems.”

To solve this problem, he pledged to help us “rediscover our bonds to each other and get out of this constant, petty bickering that’s come to characterize our politics.”

The last three and a half years of divisive politics and broken promises have been disappointing.

The Obama administration did not cause the crisis we faced in January 2009. Bad policies from both parties in Washington and irresponsible behavior on Wall Street fueled the build-up of uncreditworthy mortgage liabilities in the financial sector, resulting in overwhelming debt levels and then a wave of panics, bankruptcies and foreclosures. The global financial system stood on the brink of collapse.

Yet, instead of keeping his campaign promises, advancing centrist policies to win the support of both parties, and addressing our real challenges, President Obama pursued an ideological agenda that made matters worse.

His administration and Congress sought to transform a free-enterprise society into a government-centered society. That meant a vastly expanded role for the federal government, higher spending to support that role, with higher taxes and debt to pay for his entitlement programs.

His party’s congressional leaders squandered hundreds of billions of dollars aimed to jump-start the economy and keep unemployment from rising above 8 percent. Unemployment rose above 10 percent and has remained above 8 percent for more than 40 straight months.

Instead of focusing on getting the economy back on track, the president and the last Congress enacted a government-driven health care program. They spent 16 months pursuing this disastrous law, ramming it through on a party-line vote despite warning after warning that Americans rejected his misguided plan.

Rather than address Wall Street’s financial accountability issue, the president and his Congress continued to funnel billions of dollars to Fannie Mae and Freddie Mac, and enacted the Dodd-Frank law giving protection and preferential treatment to big banks and more power to regulators who failed in the last crisis.

In 2005, Sen. Obama and other Democratic members stopped the Senate from considering legislation that would have empowered a regulator to crack down on these ‘Government-Sponsored Enterprises,’ and control their buildup of risky assets. That legislation might have eased or prevented the home mortgage meltdown that led to the financial panic three years later. Instead, Fannie and Freddie’s executives were enriched, the taxpayer got stuck with a bill of more than $300 billion to bail them out, while millions of Americans lost their homes in ensuing financial crisis.

The crony capitalist approach is a failure: economic growth and job creation remain anemic. Unprecedented numbers of Americans have stopped looking for work. Real GDP crept up just 1.7 percent in 2011, and 1.9 percent in the 1st quarter of 2012 — well below private-sector forecasts for this year, the 3 percent historical trend rate of U.S. growth, and a fraction of the pace in a typical recovery.

The government’s fiscal position has sharply deteriorated during President Obama’s term. In three and a half years, debt held by the public grew by about $4.5 trillion — a 70 percent increase. Instead of the promised 50 percent reduction, this year’s deficit is expected to come in at $1.2 trillion. This failure may be the President’s most consequential broken promise. Our debt is projected to spiral out of control in the years ahead. This is paralyzing economic growth. Investors, businesses and families fear that the coming debt crisis portends a diminished American future.

Americans aspire to control our own destiny and remain free from foreign powers who would impose limits on our dreams for ourselves and our children. If our generation fails to meet this challenge, America will surrender her independence to an army of foreign creditors who already own roughly half of our public debt. The policies in place today guarantee that outcome, unless we change course soon.

The budget passed by the House of Representatives earlier this year drew the pattern for a new president and Congress to follow beginning in 2013. It is a plan to lift the debt and free the nation from the constraints of ever-expanding government.

This budget will promote economic growth and opportunity immediately, with bold and fundamental reforms to the tax code and a credible, principled plan to stop the debt crisis from occurring.

President Obama’s government-centered policies embody corporate welfare, taking from hard-working Americans to support politically connected companies and privileged special interests. Our budget proposes to end corporate welfare.

Our budget will strengthen welfare programs for those who truly need support.

Government safety-net programs have been stretched to the breaking point in recent years, failing the very citizens who need help the most. Relying on distant government bureaucracies to lead the effort to assist those in need simply does not work. As a result of a government-centered approach to the war on poverty, one in six Americans is now in poverty – the highest rate in a generation.

Our budget draws on the historic proven welfare reforms of the 1990s, empowering state and local governments, communities, and individuals who are closest to those in need. We also promote opportunity and upward mobility by strengthening job training programs that help those who have fallen on hard times in an era of economic and technological change.

Our budget lifts the debt, fosters economic growth, and ensures that government keeps the promises it is making to Americans. Instead of letting critical health and retirement programs go bankrupt, our budget saves and strengthens them to fulfill their mission in the 21st Century.

A debate about the future of Medicare is overdue. Unfortunately President Obama frightens seniors with false charges about our plan, while staying silent about how he has already changed Medicare forever. His health care law put a board of 15 unelected bureaucrats in charge of cutting Medicare.

Senior citizens should be greatly concerned about Democrats’ efforts to stop true Medicare reform, because this will result in painful benefit cuts for current recipients. Our budget makes no changes for those in or near retirement and keeps the protections that have made Medicare a guaranteed promise for seniors over the years.

To save Medicare for future generations, we propose to put 50 million seniors, not 15 unaccountable bureaucrats, in charge of their personal health care decisions.

President Obama will push us further in the wrong direction on taxes. He is committed to taking more from the paychecks of hard-working Americans – not to pay down the debt, but to chase ever-higher government spending.

Only with the right leadership in place can we move forward with ideas that renew the American promise of leaving our children a stronger nation than the one our parents left us.

I remain confident in the wisdom of the American people to choose a brighter path. With a decisive victory this November, we can get back to work, rebuild our country, and meet our generation’s defining challenge by ensuring greater opportunities for generations to come.

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