Brummett: Tea Party is “right-wing extremists” and are causing debt ceiling crisis

Ernest Istook at the Saint Paul Tea Party Rally 4/16/2011 Part 1

John Brummett in his article “Taking a stand  upside the face,” July 30, 2011, Arkansas News Bureau, asserted:

The problem is that hard-right, tea party-inspired Republicans ought to be marginalized in the debate, paid no attention, while mainstream Republicans and Democrats fashion a practical compromise of strategic spending cuts and routine agreement to pay our debts, which ought to go without saying. But mainstream Republicans have been cowed by these right-wing extremists, leading to a potential debt default and likely lowering of our country’s credit rating. This could well cause harm to all of us economically. We are left only with the option to get behind the bipartisan last-gasp efforts of the Senate leaders, Harry Reid and Mitch McConnell, while tea party types get invited to go take the proverbial flying leap.

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What is the root of the problem? Is it the Tea Party right wing Republicans? Or is it the uncontrolled spending? Why can’t we eliminate the Dept of Education and cut out the food stamp program that has doubled in the last 3 or 4 years?

My response is very simple. I saw a video clip by Reason TV on the debt ceiling and it showed a husband and wife at the dinner table looking over a pile of credit card bills. She  tells her husband that they are 14 trillion in debt and his response is, “We will get more credit cards!!” Her expression is classic when he says this. It is also very humorous when he walks into the next room and tells his one year old son who is now standing, “I need you to grow and get a job.” His son’s puzzled look is also very funny.

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 Here are some thoughts from Reason TV below followed by an article on food stamps.
 

Uploaded by on Mar 1, 2011

[Editor’s Note: Go to http://reason.com/blog/2011/03/01/raising-the-debt-limit-it-just for details, charts, and links]

Some say the world will end in fire and some say in ice.

But in Washington, a lot of people say it will end if we don’t continually raise the debt ceiling.

The statutory debt limit, or debt ceiling, represents the maximum amount of debt the federal government can carry at any given time. The limit was created in 1917 so that Congress wouldn’t have to vote every time the government wanted to increase the amount of debt (which was becoming a more and more frequent occasion). Since then, the Treasury Department has had the authority to issue new debt up to whatever the limit is to fund government needs. Last year, the limit was raised to $14.3 trillion, an amount that is about to reached.

As it approaches, Federal Reserve Chairman Ben Bernanke has said failing to raise the limit would likely mean the U.S. would default on its debt, creating “real chaos” in place of the fake chaos that’s out there now. Treasury Secretary Timothy Geithner has said that failing to raise the limit would be “deeply irresponsible” and and Austan Goolsbee, President Obama’s chief economic adviser, has said that not raising the limit would create “the first default in history caused purely by insanity.”

Eh, maybe.

As Reason columnist and Mercatus Center economist Veronique de Rugy, has pointed out, we’ve maxed out the nation’s credit card in the past without such dire results. In the mid-1980s, the mid-1990s, and in 2002, for instance, the debt limit wasn’t raised for months at a time and the government got along just swell. The government has a big bag of tools it can use, ranging from playing around with the amount of spending that is liable to the limit to prioritizing interest and debt payments over other outlays. Interest on the debt for this year is projected to be about $225 billion and government revenue is expected to be around $2.2 trillion, so the government can easily pay the vig and avoid defaulting.

What it shouldn’t do is simply keep piling on the debt. The limit has been raised no fewer than 10 times in the past decade. When Republicans ran the White House and the Congress, they voted overwhelmingly to charge it and Democrats, including Sen. Obama, hollered bloody murder. In 2006, he called the need to yet again increase the debt limit “a sign of leadership failure.” Now that Dems run the show, the GOP has suddenly rediscovered its inner cheapskate.

So it goes.

The boldest plan to rein in spending and debt comes from newcomer Sen. Mike Lee (R-Utah), a Tea Party favorite who dispatched Republican incumbent Bob Bennett in the primaries before coasting to victory in the general election last fall. Lee has vowed to block passage of a debt-limit increase unless Congress signs on to his balanced-budget amendment which would cap annual federal spending at 18 percent of Gross Domestic Product (GDP). The amendment would require a super-majority of two-thirds in the Senate and House of Representatives. Lee’s bill is competing with another Republican proposal from Sens. Hatch (Utah) and Cornyn (Texas) to cap spending at 20 percent of GDP. The Hatch-Cornyn bill has weaker rules on its higher cap as well.

In 2010, spending came to about 24 percent of GDP and it’s expected to come in around 25 percent of GDP in 2011. Since 1950, total federal revenues have averaged 17.8 percent and have reached higher than 20 percent exactly once. Spending over the same time has averaged just under 20 percent.

Whether Lee’s proposal carries the day — and there’s a strong case that its passage would do more to calm financial markets than simply bumping up the federal credit line — neither the Democratic nor the Republican leadership has yet to advance a serious proposal to cut spending and reduce outstanding debt. Indeed, both the president’s budget proposal for 2012 and the generally non-existent Republican response are not only deeply irresponsible but clear signs of insanity.

That ain’t right. But it does help explain why a government that has increased spending over 62 percent in real dollars can no longer get by on a $14 trillion debt ceiling.

For more info, go to http://reason.com/blog/2011/03/01/raising-the-debt-limit-it-just

Video written and produced by Austin Bragg. Article text by Nick Gillespie.

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Food Stamp Price Tag Rising

 

Food stamp usage is at record levels according to the New York Times, with one in eight Americans now receiving benefits. There are several reasons for the upswing, including expanded eligibility in the 2000s and the severe economic downturn. The following chart shows the dramatic rise in spending for the Supplemental Nutrition Assistance Program, known as the Food Stamp program until 2008 when Congress changed its name to sound more palatable.  

  

Most Americans think that we should aid those in real need, but individuals should do so voluntarily without resorting to forced government transfers.  
 
The Times gives three examples of people who recently started receiving food aid. Each offers some food for thought.
 
The first is a 45 year-old Harlem widow with an annual income of $15,000. A food bank had encouraged her to apply for the benefits:
A big woman with a broad smile, Ms. Bostick-Thomas swept into the group’s office a few days later, talking up her daughters’ college degrees and bemoaning the cost of oxtail meat. “I’m not saying I go hungry,” Ms. Bostick-Thomas said. “But I can’t always eat what I want.” The worker projected a benefit of $147 a month. “That’s going to help!” she said. “I wouldn’t have gone and applied on my own.”
I don’t know this woman’s exact circumstances, and there’s no reason to doubt she needs assistance. But aren’t her college-educated daughters in a position to help their mother? Government welfare undermines the traditional role the family played in mutual assistance.
 
Here’s the second example: 
Juan Diego Castro, 24, is a college graduate and Americorps volunteer whose immigrant parents warned him “not to be a burden on this country.” He has a monthly stipend of about $2,500 and initially thought food stamps should go to needier people, like the tenants he organizes. “My concern was if I’m taking food stamps and I have a job, is it morally correct?” he said.
But federal law eases eligibility for Americorps members, and a food bank worker urged him and fellow volunteers to apply, arguing that there was enough aid to go around and that use would demonstrate continuing need. “That meeting definitely turned us around,” Mr. Castro said.
This fellow’s annualized monthly stipend is more than I made in my first job in Washington. And for Mr. Castro, who was warned not to be a burden on this country, he ought to be told that the federal Americorps program is exactly that. But more disconcerting is the fact that the food bank worker urged him and his colleagues to go the dole in order to advertise it.
 
This anecdote illustrates Michael Tanner’s argument that government poverty programs serve vested interests:
Among the non-poor with a vital interest in anti-poverty programs are social workers and government employees who administer the programs. Thus, anti-poverty programs are usually more concerned with protecting the prerogatives of the bureaucracy than with fighting poverty.
The last example from the Times is a Columbian immigrant who missed three months of work as a janitor because she fell and had to have knee surgery:
Last November, she limped into a storefront church in Queens, where a food bank worker was taking applications beside the pews.
About her lost wages, she struck a stoic pose, saying her san cocho — Colombian soup — had less meat and more plantains. But her composure cracked when she talked of the effect on her 10-year-old daughter. “My refrigerator is empty,” Ms. Catano said.
Last month, Ms. Catano was back at work, with a benefit of $170 a month and no qualms about joining 38 million Americans eating with government aid. “I had the feeling that working people were not eligible,” she said. “But then they told me, ‘No, no, the program has improved.’”
This is precisely the sort of person that is deserving of charity. But the federal government isn’t a charity; it is a forced transfer machine. The less fortunate, and society as a whole, would be better off if the taxes paid to support inefficient, counterproductive government programs were instead left in the hands of supportive individuals and organizations. 

See this essay for more on government food subsidies.

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