Guess what they’re NOT cutting in the Fiscal Cliff | Simon Black

… I’ve spent days analyzing the bill… and frankly, it’s a joke. You can read the 200+ pages yourself if you like, but here are the important points–

As we’ve discussed before, US government spending falls into three categories.

1. Discretionary spending is what we normally think of as ‘government.’ It funds everything from the military to Homeland Security to the national parks.

2. Mandatory spending covers all the major entitlement programs like Social Security and Medicare.

Then there’s (3.) interest on the debt, which is so large they had to make it a special category.

The latter two categories are spent automatically, just like your mortgage payment that gets sucked out of the bank account before you have a chance to spend it. The only thing Congress has a say over is Discretionary Spending. Hence the name.

But here’s the problem– the US fiscal situation is so untenable that the government fails to collect enough tax revenue to cover mandatory spending and debt interest. In Fiscal Year 2011, for example, the US government spent $176 billion MORE on debt interest and mandatory spending than they generated in tax revenue.

In Fiscal Year 2012, which just ended 6 weeks ago, that shortfall increased to $251 billion. This means that they could cut the ENTIRE discretionary budget and still be in the hole by $251 billion.

This is why the Fiscal Cliff is irrelevant. The automatic cuts that are going to take place don’t even begin to address the actual problem; they’re cutting $110 billion from the discretionary budget… yet only $16.9 billion from the mandatory budget.

Given that the entire problem is with mandatory spending, slashing the discretionary budget is pointless. It’s as if the US economy is a speeding train heading towards a ravine at 200 mph, and the conductors are arguing about whether they should slow down to 150 or 175.

Oh, and there’s just one more problem…  go here

The Late 20th Century Western Lifestyle Isn’t Going To Be Around Much Longer | Mark Steyn / Investors.com

The Eurovision Song Contest doesn’t get a lot of attention in the United States, but on the Continent it’s long been seen as the perfect Euro-metaphor.

Years before the euro came along, it was the prototype pan-European institution, and predicated on the same assumptions. Eurovision took the national cultures that produced Mozart, Vivaldi and Debussy, and in return gave us “Boom-Bang-A-Bang” (winner, 1969), “Ding-Ding-A-Dong” (winner, 1975) and “Diggi-Loo-Diggi-Ley” (winner, 1984).

The euro took the mark, the lira and the franc, and merged them to create the “Boom-Bang-A-Bang” of currencies.

How will it all end? One recalls the 1990 Eurovision finals in Zagreb: “Yugoslavia is very much like an orchestra,” cooed the hostess, Helga Vlahovi?. “The string section and the wood section all sit together.”

Shortly thereafter, the wood section began ethnically cleansing the dressing rooms, while the string section rampaged through the brass section pillaging their instruments and severing their genitals. Indeed, the charming Miss Vlahovic herself was forced into a sudden career shift and spent the next few years as Croatian TV’s head of “war information” programming. Continue reading

French Elect Socialist President and Click Ruby Heels Saying “There is No Place Like Greece” | Confounded Interest

Well, the French have pretty much f’d themselves. (Go figure.)  Now, let’s fasten our seatbelts and watch as the other Euro-dominos roll. GE.

Francois Hollande defeated French President Nicolas Sarkozy as voters handed control of the second-biggest European economy to the Socialists for the first time in 17 years. Rather than face the pain of cuts to entitlements and other government spending, the French people opted for the “ruby Slipper” solutions – RAISE taxes, RAISE government spending, INCREASE entitlements. You know, the same policies that have doomed France and Europe to perpetual malaise.  Socialist Hollande’s simple solutions include:

-Taxes
*Impose a tax on financial transactions.
*Impose a 75 percent income tax on earnings above 1 million euros ($1.32 million) and raise the rate to 45 percent for the income bracket between 150,000 euros and 1 million euros per year.
*Repeal 29 billion euros of tax breaks over the next five years.
*Increase total tax level to 46.9 percent in 2017 from 45.1 percent in 2012 (payroll and profit).
*Increase tax on biggest companies to 35 percent.
*Scrap Sarkozy’s 1.2 percent VAT increase.

-Public spending:
*Raise state spending by 20 billion euros over five years.
*Allow those who have worked more than the legal minimum of 41.5 years to retire from the age of 60.
*Limit pay of executives at state-owned companies to 20 times the lowest wage.
*Hire 60,000 teachers and school employees and 5,000 police officers over next five years.
*Hire 150,000 youths in state-subsidized jobs over the next five years.
*Cut French president’s and Cabinet ministers’ pay by 30 percent. Continue reading

A Solution To The National Debt: A Taxing Issue | Nano Patents

…Kwak said the Republicans have a “coherent, well-articulated” position on revenues: that society would be better if government, and thus taxes, would simply shrink. By contrast, Kwak added, in recent decades Democrats have never been able to settle on a coherent message about the need for greater taxes.

“The counter-argument to the conservative vision has not been spelled out,” Kwak said….via Nano Patents and Innovations

Picture Summary of 5 Core Threats to the Economic Future of Families & their Children compared to the past | Michael Hodges

Each generation hopes their children and grandchildren will achieve more economic potential and more individual freedom than prior generations. As a new grandfather I researched economic conditions and education quality facing the generation of my infant grandchildren and their parents, compared to that faced by my generation when their age. The results are available to you in a series of free mini-reports listed on the home page – with explanatory pictures.

There are so many great & positive things about our beloved America to celebrate. But, there are also some negative trends. Perhaps if more are aware of the negatives even more solutions & positives will result. The objective of these reports is to increase awareness of certain disturbing items, using an easy-to-understand format with hard data presented in picture form.

via Grandfather Economic Report Summary by MWHodges.