Federal Debt Ceiling Observations
May 11, 2023
Hanging their hats on false equivalence
The underlying logic Speaker Kevin McCarthy and his crew lean on in their arguments relative to the federal debt ceiling rely on false equivalencies.
The gist of their message seems to be, “Just as families and businesses balance their checkbooks every month, we believe the federal government needs to make balancing the nation’s checkbook a top priority. Raising the debt ceiling is a short-term solution to a long- term problem. Before we consider raising the debt ceiling, our federal government needs to focus on reducing spending and living within its means to ensure a healthy economy for future generations”.
Sounds pretty good, right?
Yet, that explanation illuminates one of the greatest obstacles we face as a nation: A void of economic and financial understanding among most American adults.
The ‘checkbook’ is the equivalent of an annual budget. Current revenues flow in, and current expenses flow out. If revenues exceed expenses, there is a surplus. When revenues exactly equal expenses, it is ‘break even’. When expenses exceed revenues, there is a current-year deficit.
Staying with the household theme, the federal debt is most equivalent to a home mortgage, and the balance due is an accumulation of debt over time. Remember that new roof? That new kitchen? That fabulous backyard pool? Those were capital expenses, incurred in one year, but with an expected useful life of 10, 15, even 30 years. You add these expenses to the mortgage so that they get paid off over time.
As a retired professional in the field of finance and economics, when I hear Speaker McCarthy or members of his crew attempting to equate current spending to our overall aggregate debt obligations, I cringe.
Some rather simple adjustments to our tax code, including elimination of the carried interest loophole and raising the top corporate rate from 21% to 28% would make huge revenue contributions to balancing the annual (current FY) federal budget.
And, why is it that low- and moderate-income wage earners are required to make contributions to Social Security on every dollar of their earnings up to the current wage cap [a.k.a. ‘the contribution and benefit base’] of $160,200, yet those who are blessed to earn in excess of that amount are exempt from contributions to Social Security on earnings above that amount?
The wage cap on Medicare contributions was eliminated in the 1990’s, so even higher-income wage earners are required to make the 1.45% contribution to the Medicare tax with no limit on earnings.
We clearly have a revenue gap. Why does the cap on social security earnings continue to this day? And, those who claim their income not as ‘wages’ but as ‘carried interest’ not only receive beneficial income tax treatment, they also are exempt from FICA contributions. What a racket!
Federally guaranteed obligations are debt securities issued by the U.S. government, currently considered risk-free because they are backed by the full faith and credit of the federal government. When the Treasury sells these securities, they help to finance the federal debt outstanding at that time.
Allowing the government to default as an outcome from a false debate linking current revenues and spending to our long-term debt obligations would be a preventable tragedy of immense proportions.
Minority Leader Hakeem Jeffries (if you are listening): I implore you to be bold and to tear apart Speaker McCarthy’s logic map, and to take this opportunity to focus in on one of the greatest obstacles we face as a nation: A void of economic and financial understanding among most American adults. Until the American people awake from their deprivation of economic and financial principles, they will continue to be vulnerable to Alternative Facts such as those presented by Speaker McCarthy and his crew.
The Big Lebowski must have learned of McCarthy’s foolish and destructive crusade to equate and combine the federal debt ceiling with the current (2024) federal budget when he so eloquently said, “This will not stand, you know. This aggression will not stand, man”.
I Don’t Love Joe Biden
October 20, 2022
But should we blame him for our current economic malaise?
When I was a young pup, I remember Uncle Cal frequently referring to certain elected officials as “a Horse’s Ass”. Back then, I didn’t know what he was trying to infer, but it sure sounded good!
Uncle Cal is long gone, but it seems the supply of Horse’s Ass elected officials has expanded significantly and I’m frustrated, angry and simply miserable as I watch and listen to ‘broadcast journalists’ and various political pundits who seem to have no grasp of economics as they explain current economic conditions to an audience of [potentially] economic illiterates. Thus, the origin of my current ‘rant’:
Stock Prices, Inflation, Recession & Economic Cycles
Economic cycles – also known as business cycles — are a reality, and they can be tracked over time.
They generally are predictable, although not in precise time frames. Economic cycles consist of four identifiable phases or stages: (a) Expansion; (b) Peak; (c) Contraction; and (d) Trough.
Every economic cycle includes a period of euphoria and exuberance marked by a sustained period of economic growth; followed by a period of uncertainty and lethargy linked to a period of economic decline.
The Great Recession officially ended in June 2009. By the time Donald Trump took office in January 2017, he inherited an economy in its 91st month of economic expansion.
That expansion continued into 2020, becoming the longest period of expansion on record, peaking at 128 months in February 2020.
Donald Trump has never failed to speak his mind. During the campaign leading to the 2020 presidential election, Trump proclaimed, “If (Joe Biden) is elected, the stock market will crash!”. [In 2018, Trump said, “When a country (USA) is losing many billions of dollars on trade with virtually every country it does business with, trade wars are good, and easy to win.” In late January 2020, Trump also said, “We have it (coronavirus) totally under control. It’s one person coming in from China. It’s going to be just fine.”]
Facts are facts:
- Five years ago (October 20, 2017) the S&P 500 closed at 2,575; it closed today (10/20/2022) at 3,666, an overall 5 year gain of 42%; an average of 7.3% per year.
- Ten years ago (October 2012), gasoline sold for $3.62 per gallon in Florida. AAA shows the current Florida price per gallon at $3.38.
- Case-Shiller reported a ten year 288% price increase for housing in the Tampa Bay area (where I currently live) from Mid-2012 to Mid-2022. This is partly due to (1) recovery from the Great Recession; (2) stimulus due to artificial below market interest rates (Fed Policy); and (3) supply/demand imbalance primarily due to local and regional housing policy decisions over time.
- The most recent CPI-U release from BLS reflects an annual inflation rate of 8.2 % through September 2022, the highest in four decades. Yet, if we look back to 2012, we can see the average annual rate over that decade computes to about 2.5% annually, with near zero periods during the Pandemic.
What’s really going on? There are a number of pieces to this puzzle, including:
- The lingering effects of a Pandemic;
- The Russian invasion of Ukraine;
- Aftershocks (direct and indirect) from draconian tariffs enacted beginning in 2018;
- Ongoing ripple effects from the 2017 Tax Cuts and Jobs Act (TCJA); and
- Various supply chain issues, both domestic and international.
The root cause of our current intersection of inflation and stock market volatility likely traces back to 2010, when the Fed launched “QE2” – quantitative easing – essentially increasing liquidity in the domestic economy to stimulate economic growth. One of the outcomes from QE is a decrease in bond prices due to falling interest rates, combined with a run-up in stock prices as investors search for yield.
When the Fed announced its QE2 plan in November 2010, 30-year mortgages were at 5%; and the S&P 500 index was 1,200. Over the course of the next few years, rates on 30-year mortgages dropped as low as 3.3%, while the S&P 500 index inched toward 2,010 (which it reached in September 2014).
Meanwhile, the CPI from 2010 to the end of 2020 remained relatively calm, reflecting the lagging effects of the economic recovery which began in mid-2009.
It is relatively easy to look into the rearview mirror now to observe that the Fed’s responses to (a) the Great Recession; and then (b) impacts of Covid on our economy helped to create an environment which fueled the inflation we are facing today.
In March 2020 — in addition to a promise to inject a Trillion dollars into the U.S. banking system — the Fed cut the federal funds rate to a range of 0% to 0.25%.
The rapid and aggressive response by the Fed likely saved our economy from implosion, but also helped inspire a dramatic run-up in both stock prices and home prices: The S & P 500 index rose from 3,000 in early March 2020 to reach 4,700 in November 2021 as investors chased phantom returns on investment. (Stock prices were further bolstered by massive stock buybacks inspired by the 2017 TCJA).
Home mortgage interest rates are a critical determinant of purchasing power for most borrowers. As far back as 1971, 30 year fixed-rate mortgages had never been offered below 7%; they moved up to 9% in 1974; climbed to 11% in 1979; and reached a peak of 16.6% in 1981.
Our economy is a long game. The few months when home mortgage interest rates were at or below 5% is an aberration enabled by Fed policy. Now that long-term mortgage rates have settled into the 7% to 9% range [which seems rationale and appropriate based on history], home prices will also stabilize.
It seems convenient for some to blame Joe Biden for (a) high gasoline prices; (b) rapidly rising consumer prices; (c) a stock market ‘meltdown’; and (d) even for supply chain dysfunctions.
A quick look at history confirms that there is a rather significant lag between the point when policy is affirmed and enacted; and the future point when we begin to see and experience results from those actions.
The Biden White House has pledged to fight against inflation, and has stubbornly refused to blame the Fed for our current economic symptoms.
Although there seem to be plenty of contributing factors, the real truth is: We relied almost entirely on monetary policy to steer the ship for more than a decade, and that approach brought us to this moment, not 24 months of Democratic control in the White House.
And, if the Fed would just slow down their relentless and uncompromising initiatives to raise interest rates to the point of choking off the economy as they attempt to rein in inflation, we might experience a smooth correction, and a gentle return to the economic expansion phase we all want to see.
A new look at the Republican Party
January 13, 2022
During my college years, I was introduced to the writings of Franz Kafka; that may help explain my rather bizarre sense of humor.
Don’t Tread on Me
May 17, 2019
The late George Wallace, former Alabama Governor, was noted for his rigid and often harsh opinions which he shared freely with the rest of the world. In his 1963 inauguration speech, Wallace proclaimed, “Segregation now, segregation tomorrow, segregation forever.”
In response to what he felt was federal government overreach in its attempt to desegregate the University of Alabama, Wallace said, “The unwelcomed, unwanted, unwarranted, and force-induced intrusion upon the campus of the University of Alabama today of the might of the central government offers frightful example of the oppression of the rights, privileges and sovereignty of this state by officers of the federal government.”
Or, slightly modified to address current events, “The unwelcomed, unwanted, unwarranted, and force-induced intrusion upon the reproductive rights of women across the State of Alabama today of the might of the state government offers frightful example of the oppression of the rights, privileges and sovereignty of individual citizens by elected officials of the state government.”
It’s one thing to observe the sons, male cousins and grandsons of the late George Wallace as they link hands with the remaining white male disciples of the former Alabama Governor to assert their testosterone-fueled dominance over whatever they find annoying or objectionable.
It’s another thing to listen to female elected officials in Alabama proudly proclaiming victory over the right of women — as individuals protected by the same rights the US Constitution conveys to men — to make determinations over their own reproductive health.
Alabama House Rep. Terri Collins, who sponsored the bill, publicly identifies as female, as does Alabama Governor Kay Ivey who signed the bill into law.
Have they completely lost touch with reality?
Someone recently said, “I don’t know of any woman who engaged in sexual activity – forced or consensual – with the hope to have an abortion.”
Abortion is not a sport; it is a deeply personal and painful decision which should be made carefully and rationally, because it has lifetime repercussions.
Those who fly the Gadsden flag and rail against government intrusion on individual rights are often the very same folks who are adamantly pro-life and who vehemently oppose a woman’s right to self-determination.
The Gadsden Flag says it all…
More on: Tax Cuts & Jobs Act
April 16, 2019
Paul Ryan retired from Congress in January 2019 after 20 years of service culminating in his 3+ years of service as Speaker of the House.
Ryan was the chief cheerleader for the Tax Cuts and Jobs Act, and he left D.C. touting it as the greatest accomplishment of his political career.
Ryan repeatedly exclaimed how this new legislation (TCJA) would unleash unprecedented U.S. economic prosperity, by providing:
- Tax relief for middle-income families;
- Simplification of the tax code for individuals;
- Economic growth; and
- Repatriation of $3+ Trillion of profits U.S. companies have parked overseas would generate more investment and jobs in the U.S.
16 months after passage of the TCJA, it should be crystal clear that:
- Almost none of the tax cut benefits have reached the low- and middle income Americans who were promised tax relief;
- The TCJA legislation is some 1,097 pages itself, and it states very clearly that it is an Amendment to (the existing) Internal Revenue Code of 1986 (not a simplification);
- Economic Growth? The jury is still out on this one, but there seems to be no evidence of growth above or beyond the existing growth trend line which began in mid-2009;
- American companies have returned some (+/- $500 Billion) of their profits held overseas as a result of the tax holiday which was part of TCJA. Much of that money was used for stock buy-backs and debt reduction.
In fact, 16 months following the passage of the TCJA, U.S. companies are still waiting for final guidance from the Treasury Department on many of the final rules relative to repatriation.
And, despite continued U.S. economic growth and record corporate profits, a record 60 Fortune 500 companies avoided paying any federal income tax in 2018.
Federal tax revenues have declined during a period of economic expansion and our government spending has increased, thus the verifiable result from Paul Ryan’s signature accomplishment – the TCJA — is an increase in our federal deficit, an extra-special gift to our children and grandchildren.
The Treasury Department announced in March 2019 that the deficit for the first four months of the 2019 budget year (which began Oct. 1, 2018) totaled $310.3 Billion, up from a deficit of $175.7 Billion in the same period the year prior.
The Congressional Budget Office is projecting that the annual federal deficit between revenues and expenses will hit $897 Billion in fiscal year 2019, up 15.1 percent from the $779 Billion deficit recorded in FY 2018.
The end result: Our total federal debt will reach $22 Trillion this year – about 105% of GDP.
Why is that important? A comprehensive study by the World Bank examined economic data from 100 developing and developed economies spanning a time period from 1980 to 2008, concluding that a public debt/GDP above 77% begins to create a drag on economic growth.
The World Bank analysis concluded that for each additional percentage point of debt above the 77% threshold costs 0.017 percentage points of annual real growth.
If the World Bank study is correct, we are currently missing about 0.5% of our economic growth potential due to misguided public policy decisions, in addition to the future burden of repaying federal debt which was incurred unnecessarily.
Paul Ryan achieved his personal goal of shepherding record tax reform through Congress resulting in the passage of TCJA.
Although his personal goal was achieved at the expense of American society, Paul Ryan clearly is a winner. So, please join me in sending a note of thanks and congratulations to Paul Ryan. He left us a legacy.
Paul Ryan & Tax Cuts
April 16, 2019
Dear Paul Ryan,
In 1998 – at the age of 28 – you were first elected to the House of Representatives to represent the 1st District of Wisconsin. You were re-elected a number of times, and you served for 20 years in Congress.
After John Boehner announced his intention to resign from the House and the Speakership in 2015, you were selected by your colleagues to become Speaker of the House.
You were involved in some very positive legislative accomplishments during your 20 year tenure as a Congressman representing the 1st District of Wisconsin, and during your tenure as Speaker of the House.
Unfortunately, your legacy will forever be connected to the Tax Cuts and Jobs Act (TCJA) which was passed into law at the end of 2017.
Although the TCJA provided the Trump Administration with an accomplishment relative to their campaign platform, it is a highly flawed piece of legislation which was created on a foundation of fictitious and inaccurate assumptions.
Just 16 months following the passage of TCJA, we can clearly see the adverse impacts.
Business and corporate tax cuts have resulted in: stock buy-backs; excessive executive compensation and bonuses; acquisitions and consolidations resulting in plant closings and layoffs. All of these have been enabled by tax cuts which have resulted in 60 major corporations paying zero federal income taxes in 2018.
Whereas in times of economic expansion, the great majority of economists advise public sector entities to reduce deficits and aim for balanced budgets, the TCJA does just the opposite.
Some of the loss of tax revenue from business and corporate entities has been replaced by increased federal tax liability on individuals (like me), the majority of the lost tax revenue has been made up through deficit spending.
The annual federal budget deficit is expected to reach $900 Billion in fiscal 2019 and to equalize in the range of $1 Trillion annually for the next decade, up from $779 Billion in 2018.
Mr. Ryan: over the course of your service in Congress, you achieved national recognition as a conservative policy wonk and as a relentless critical observer of our federal budget. You seemed to be a relentless critic of federal deficits, winning acclaim from centrists for your detailed charts showing the dangers that fiscal shortfalls posed to America’s future.
You slipped out of Washington in January 2018 knowing that you led the American people down a dangerous and dead-end road.
In your defense, we can acknowledge that you reluctantly took on the role of Speaker knowing that it was an impossible responsibility to fulfill. Despite this, we must hold you fully accountable for failing to disclose to your constituents – and the entire U.S. population – that the TCJA was a sham – a complete flim-flam designed to create a false reality.
Paul Ryan: Let us hope that your family, your wife, your children – and your neighbors – are willing and able to forgive you for selling out the interests of the people of Wisconsin — as well as the people of the United States – for whatever benefits you personally gained from your treachery toward the end of your tenure in Congress when you became the champion of the fictitious Tax Cuts and Jobs Act.
Mr. Ryan: Good luck to you, and God bless.
House Oversight Committee: 2/27/19
February 27, 2019
I was looking forward to hearing the testimony of Michael Cohen before the House Oversight Committee, particularly interested to learn more about some of the ‘behind the scenes’ actions and activities which took place during Cohen’s ten year stint as a lawyer for Donald Trump, and as an executive of The Trump Organization.
It is clear that Michael Cohen is guilty of multiple frauds and felonies.
Cohen pleaded guilty to eight charges in August 2018, including several counts of tax fraud and campaign finance violations. He also pleaded guilty in November 2018 to a charge of lying to Congress from Special Counsel Mueller’s office.
Said Cohen, “I take full responsibility for each act that I pled guilty to: The personal ones to me and those involving the President of the United States of America.”
In December 2018, Cohen was sentenced to a term in federal prison for the eight criminal counts he pleaded guilty to in August. The judge gave him an additional two months for the special counsel charge.
Despite pending imprisonment for his acknowledged bad behavior, Cohen agreed to provide public testimony to the House Oversight Committee on February 27, 2019.
It was my expectation that – during this public hearing – committee members would politely hear testimony from Mr. Cohen, followed by a question and answer session which might provide us with a broader understanding of the issues.
Upon completion of the public hearing, I anticipated that members of the committee would meet sometime in the near future to study, discuss and debate the findings of the hearing.
At a future date, I expected that I would learn from traditional media sources about next steps: Further investigation? Criminal referral(s)? Case closed?
I appreciate and covet freedom of speech, and I am cognizant of special protections afforded to Members of Congress to ensure they are not censured for statements made in their official capacity.
That said, today I witnessed two members of the House Oversight Committee go off course early in the proceedings, and they continued to cloud and obfuscate the intended purpose of the hearing almost to the very end.
The behavior and demeanor of Rep. Jim Jordan (R, OH) and Rep. Mark Meadows (R, NC) on 2/27/19 (as displayed on national television) was unprofessional; inappropriate; and absolutely unacceptable coming from elected Members of Congress.
I am a citizen and registered voter in the United States.
As such, I am entitled to all of the protections afforded by the Constitution of the United States, including the expectation that elected Members of the House will (1) behave at all times in a manner that shall reflect creditably on the House; (2) adhere to the spirit and the letter of the Rules of the House and to the rules of duly constituted committees thereof; and (3) not receive or accept compensation, favors or other benefits from any source which would occur by virtue of influence improperly exerted from their elected position in Congress.
It is my belief that both Rep. Jordan and Rep. Meadows repeatedly violated their basic duties of comportment and professionalism during their activities today as members of the House Oversight Committee.
I do hope the House Ethics Committee will hold each of these individuals fully accountable for their unprofessional, inappropriate, and unacceptable public behavior, and I encourage others to demand accountability from Congress.
Where’s Mitch McConnell?
January 17, 2019
Where’s Mitch is a question many people are asking.
There are 800,000 federal workers and their families who are going without pay right now – including thousands of Kentuckians.
Here in Florida, we have about 5,000 Coast Guard members doing their jobs to protect our 1,350 miles of Gulf and Atlantic coastline, and they are not currently being paid.
The new Democratic House, on its first day in office, passed two bills funding and reopening the government.
McConnell has refused to allow a vote on any of those bills in the Senate. He’s even twice blocked a bill reopening the government from coming to the floor that he himself voted for back in December.
Despite the fact that Majority Leader McConnell has the ability to end this shutdown right now, Mitch is seemingly nowhere to be found.
I’m angry that this one man who has the power to stop this absurd drama has refused to do his job.
If you are nearly as angry as I am, perhaps you will consider donating $15 – or what you can afford – to the Ditch Mitch movement. Let’s shine a bright light on McConnell’s irresponsible behavior.
The Winning December Tale
December 21, 2018
Not to be outdone by venerable sources such as Franz Kafka, Edgar Allan Poe and Rod Serling (The Twilight Zone), President Donald Trump and his loyal sycophants — Sarah Huckabee Sanders and Kellyanne Conway — have created a number of fabulous and fantastic episodes for December 2018. We have endeavored to select the very best for your enjoyment tonight:
The Tale of A Shutdown
December 11, 2018: Nationally televised from The Oval Office:
“I am proud to shut down the government…I will take the mantle. I will be the one to shut it down. I’m not gonna blame you for it.”
- Donald J. Trump (speaking to Sen. Chuck Schumer)
December 17, 2018: Bloomberg News:
Among those who have opposed Trump’s wall proposal is Texas Republican Rep. Will Hurd, whose district is along the U.S.-Mexico border. Among other observations, Hurd said that the response time from the border patrol on issues of illegal immigration is hours to days, making a border wall a waste of money because a wall is no obstacle if the response time is that slow.
- Will Hurd, (R) TX
December 19, 2018: Nationally broadcast on CBS News:
Senate Majority Leader Mitch McConnell announced on the Senate floor Wednesday that he’ll introduce a short-term spending bill to fund the government into early February, and one of the president’s top aides suggested earlier in the day Mr. Trump may be amenable to that.
“We need the government to remain open for the American people,” McConnell said on the Senate floor.
Senate Majority Leader Chuck Schumer and presumptive incoming Speaker of the House Nancy Pelosi announced their support for the legislation as well, paving a path to avert a shutdown.
Pelosi said in a statement, “Democratic and Republican appropriators have been ready to pass these bills in a bipartisan way, and we are grateful for their leadership to meet the needs of the American people. This is a missed opportunity to pass full-year funding bills now. However, Democrats will be ready to fully, responsibly fund our government in January, and we will support this continuing resolution.”
- McConnell, Schumer, Pelosi
December 20, 2018: Nationally televised on “The Ingraham Angle” (Fox News):
“I think that not funding the wall is going to go down as one of the worst, worst things to have happened to this administration. Forget Mueller. The wall, the wall, the wall. Has to be built. And it’s a scandal that it hasn’t been built.”
- Laura Ingraham
December 21, 2018: Broadcast via Twitter from @realDonaldTrump:
“The Democrats, whose votes we need in the Senate, will probably vote against Border Security and the Wall even though they know it is DESPERATELY NEEDED. If the Dems vote no, there will be a shutdown that will last for a very long time. People don’t want Open Borders and Crime!”
- Donald J. Trump
December 21, 2018:
It seems clear that Donald J. Trump and his loyal sycophants have created another alternative reality in their attempt to destroy the foundation of American democracy, and Vladimir Putin is very, very happy!
The Trump Trifecta
October 26, 2018
Since taking office in January 2017, Donald Trump has stood with House Speaker Paul Ryan and Senate Majority Leader Mitch McConnell to proclaim various ‘victories’ for the American people. Here are what seem to be the top three, A.K.A. “The Trifecta”:
- Complicit with Russia, Saudi Arabia and several other suspect regimes. Trump has continued to send public messages which downplay and/or absolve bad actors from behaviors which are contrary to existing international standards.
One clear reason: Trump — and his close advisor Jared Kushner — is involved in highly leveraged real estate development. Neither Trump nor Kushner have the liquidity or availability of traditional financing sources to invest their own money. Instead, they are forced to chase shady money from around the world, including huge sums of money sourced from Saudi Arabia, Russia, China, etc.
Essentially, Trump (along with the Kushner Companies) is beholden to Crown Prince Mohammed bin Salman; Vladimir Putin; various Chinese investors; along with ‘dark money’ sources in Cyprus, Panama and the Cayman Islands, among others.
2. The “Tax Cuts and Jobs Act” (TCJA) was passed in late 2017 incorporating some modest temporary individual and small business tax cuts while focusing in on very substantial big business and corporate tax cuts.
Traditional economic models, developed and refined over countless economic cycles, encourage tax cuts and deficit spending during economic downturns as a means to stimulate economic growth. During times of economic expansion, increased government revenue from tax collections is then used to pay down public debt and help stabilize the economy.
N.B. There was a strong case to be made for a modest corporate tax cut as the U.S. economy began to improve post 2012; there was zero legitimate case to be made for the magnitude of the corporate tax cut which was a cornerstone of the 2017 TCJA.
The foundation of the TCJA was a promise that slashing corporate taxes from a maximum 35% rate to a 21% cap would result in dramatic increases in capital investment, resulting in job creation and wage growth. Americans for Tax Reform, a vocal advocate for the plan, generated promises of employee bonuses, increased wages, increased retirement contributions and/or expanded business operations as a result of the TCJA.
Actual outcomes of the Tax Cuts? Record stock buybacks; extraordinary executive compensation; flat employee compensation; and continued failure of venerable American corporations.
Definitive proof of the foolishness of cutting taxes in a time of economic expansion? A rapidly expanding federal budget deficit. According to the final monthly Treasury Statement for Fiscal Year 2018 (the year that ended on 9/30/2018), the deficit was $779 Billion — a $113 Billion (17%) increase over the$666 Billion deficit recorded from FY 2017.
Perhaps most egregious to the American people? Mitch McConnell is blaming self-funded safety net programs [Social Security, Medicare and Medicaid] as the root cause of our rising federal deficit. Visualize McConnell as he does a little smile; looks straight into the camera; and then blatantly lies to the American people. Was he also lying when he took the Oath of Office?
3. Incendiary, Irrational and Emotionally-Inspired Immigration Policy:
Right or wrong, the U.S. economy depends on immigrant workers – documented or undocumented. Industry sectors which rely on immigrants for between 1/4 and 1/2 of their employment needs include: agriculture; hospitality; construction; textile, apparel and leather manufacturing; food manufacturing; and private households.
Through a series of small moves that add up to dramatic change, the Trump administration has bypassed Congress to create new process and procedures which could have lasting effects on how the US welcomes and evaluates immigrants.
In his election campaign in June 2015, Trump told us, “When Mexico sends its people, they’re not sending their best. They’re sending people that have lots of problems, and they’re bringing those problems with us. They’re bringing drugs. They’re bringing crime. They’re rapists…”
By painting virtually all immigrants with a broad brush as criminals; as a national security threat to the U.S.; as bad people; as people who steal jobs from Americans; he has created a hostile environment on the world stage, offering fear and fallacies with no attempt to find viable and sustainable solutions.
In late October 2018, facing a ‘caravan of migrants’ moving north from Central America toward the U.S. Southern border, Trump has proclaimed that there are ‘criminals and people of Middle Eastern descent among the migrants within the caravan’ and has pointed to it as evidence that the U.S. has weak immigration laws. He has also threatened to cut off aid to Central American countries in response to the caravan.
An internal report from the Department of Homeland Security’s Inspector General found that the Trump administration’s “zero tolerance” crackdown at the border in early 2018 was troubled from the outset by planning shortfalls, widespread communication failures and administrative indifference to the separation of small children from their parents.
It has been said that the Trump Child Separation Policy is related to the worst abuses of humanity in history. Child separation is connected by the same evil that separated families during slavery, and which dislocated tribes and broke up Native American families.
What’s the point?
The point is that differences of opinion are a cornerstone of society, and a critical ingredient of humanity.
The very essence of Debate relies on formal discussion on a particular topic.
In an honest debate, opposing arguments are put forward to argue for opposite viewpoints. Genuine and honest debate can occur in public meetings, academic institutions, and in legislative assemblies.
A genuine debate requires some ground rules, particularly in the areas of logical consistency and factual accuracy, yet it also allows some degree of emotional appeal to the audience.
Sadly, today’s discussions on topics of importance to the American People seem to lack any rules about civility, logic or even factual accuracy.
Turn on the television and we find absolutism, tribalism and a “win at any cost” approach to delicate yet important societal issues. Dialogue has effectively been replaced by diatribe.
Worse, people can select news sources which support and reinforce their biases, finding comfort in “being right” by selective listening or watching. No time or need to consider other options when the platform has been fully developed to mirror your comfort zone.
Add to this dilemma the continuing disenfranchisement of American adults from the political process.
More adult males in America today are able to recite NFL statistics than are able explain issues facing American society, and women are not far behind.
Voter turnout in the United States fluctuates in national elections. In recent elections, about 60% of the voting eligible population votes during presidential election years, and about 40% votes during midterm elections. Turnout is lower for odd year, primary and local elections.
If we compare national voter participation in the 2016 presidential election to viewership of the 2016 Superbowl, we find a dead heat at around 112 Million.
Not necessarily the same people, but it does strike me that we have a real disconnect between the American public and our governance model, perhaps helping to explain why our system seems to be in need of some serious adjustments at this point in time.
walrus51 