Obstacle to Deficit Cutting: A Nation on Entitlements

Efforts to tame America's ballooning budget deficit could soon confront a daunting reality: Nearly half of all Americans live in a household in which someone receives government benefits, more than at any time in history.

At the same time, the fraction of American households not paying federal income taxes has also grown—to an estimated 45% in 2010, from 39% five years ago, according to the Tax Policy Center, a nonpartisan research organization.

A little more than half don't earn enough to be taxed; the rest take so many credits and deductions they don't owe anything. Most still get hit with Medicare and Social Security payroll taxes, but 13% of all U.S. households pay neither federal income nor payroll taxes.

"We have a very large share of the American population that is getting checks from the government," says Keith Hennessey, an economic adviser to President George W. Bush and now a fellow at the conservative Hoover Institution, "and an increasingly smaller portion of the population that's paying for it."

The dimensions of the budget hole were underscored Monday, when the Treasury reported that the government ran a $1.26 trillion deficit for the first 11 months of the fiscal year, on pace to be the second-biggest on record.

Yet even as Americans express concern over the deficit in opinion polls, many oppose benefit cuts, particularly with the economy on an uneven footing. A Wall Street Journal/NBC News poll conducted late last month found 61% of voters were "enthusiastic" or "comfortable" with congressional candidates who support cutting federal spending in general. But 56% expressed the same enthusiasm for candidates who voted to extend unemployment benefits.

As recently as the early 1980s, about 30% of Americans lived in households in which an individual was receiving Social Security, subsidized housing, jobless benefits or other government-provided benefits. By the third quarter of 2008, 44% were, according to the most recent Census Bureau data.

That number has undoubtedly gone up, as the recession has hammered incomes. Some 41.3 million people were on food stamps as of June 2010, for instance, up 45% from June 2008. With unemployment high and federal jobless benefits now available for up to 99 weeks, 9.7 million unemployed workers were receiving checks in late August 2010, more than twice as many as the 4.2 million in August 2008.
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Still more Americans—19 million by 2019, according to the Congressional Budget Office—will get federal aid to buy health insurance when legislation passed this year is implemented.

Cutting spending on these "entitlements" is widely seen as an inevitable ingredient in any credible deficit-reduction program. Yet despite occasional bouts of belt-tightening in Washington and bursts of discussion about restraining big government, the trend toward more Americans receiving government benefits of one sort or another has continued for more than 70 years—and shows no sign of abating.

An aging population is adding to the ranks of Americans receiving government benefits, and will continue to do so as more of the large baby-boom generation, those born between 1946 and 1964, become eligible. Today, an estimated 47.4 million people are enrolled in Medicare, up 38% from 1990. By 2030, the number is projected to be 80.4 million.

Still, Europe does offer examples that change is possible. Germany slashed benefits for the long-term unemployed in 2004, a step that analysts credit with prompting more Germans to get jobs as well as improving the country's budget balance. Cuts to entitlements are politically possible, says Daniel Gros, director of the Center for European Policy Studies, a nonpartisan think tank in Brussels, "but societies need some time to get used to the idea."

Payments to individuals—a budget category that includes all federal benefit programs plus retirement benefits for federal workers—will cost $2.4 trillion this year, up 79%, adjusted for inflation, from a decade earlier when the economy was stronger. That represents 64.3% of all federal outlays, the highest percentage in the 70 years the government has been measuring it. The figure was 46.7% in 1990 and 26.2% in 1960.

More HERE

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GOP establishment rejects tea party candidate who won DE Senate primary

Which could make her a winner!

It was an amazing bit of television. Almost instant followed by an amazing bit of scoop. Mere minutes after Fox News had reported the victory of conservative activist Christine O'Donnell over Establishment Congressman Mike Castle in the Delaware GOP U.S. Senate primary, former Bush Deputy Chief of Staff and Fox News consultant Karl Rove was in place on Sean Hannity's TV show to analyze. Or…well…something.

What on earth was Rove thinking? He was bitter, angry, cutting, demeaning, mean-spirited…and those were the nice things he had to say about O'Donnell.

I have no idea what Karl Rove was thinking when he sat down in front of the Fox cameras to speak with Hannity. But I know this.

All by himself Karl Rove has just given Christine O'Donnell a huge leg up on this election. In seconds he has made her look like what Americans absolutely love -- the underdog who has been unmercifully unfairly treated by the powerful and well-to-do.

And now, Carl Cameron of Fox News is reporting the National Republican Senatorial Committee will not be helping the official nominee of the Delaware Republican Party for the United States Senate in her Senate campaign.

So, in other words, having helped the losing incumbent Lisa Murkowski in Alaska, the losing incumbent Robert Bennett in Utah, swallowed hard at the victories of Sharron Angle in Nevada and Rand Paul in Kentucky, the NRSC will not be helping O'Donnell because she beat the pants off a liberal Establishment Republican Congressman?

If this is true, there is but one question: Is the Republican Establishment suicidal?

More HERE

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More on GOP stupidity when tea-party candidate won DE primary

“Let’s go balls to the wall for Christine O’Donnell,” Rush Limbaugh implored listeners on his show today, but Rush knows that his listeners are the choir to which he is preaching. It’s the party establishment and the center-right commentariat that needs to hear the message, and in that vein, Rush took on Karl Rove on today’s show.

Rush demanded to know why Rove and other establishment figures want to make Christine O’Donnell’s character the issue, when it’s the character of the current administration and Democratic leadership in Congress that should get the focus. Instead of issuing self-fulfilling prophecies of doom, shouldn’t the Republican establishment start fighting for wins in Delaware? The Right Scoop got the video:



Matt Lewis joins the fray in warning Republicans about the impact of snubbing O’Donnell:

The National Republican Senatorial Committee and Castle — who withheld his endorsement of the winner — were wrong to behave as they did. Though an NRSC spokesman issued a terse congratulations to O’Donnell, word quickly leaked that the NRSC would not fund her general election race. This was a silly thing to do. Fortunately — and wisely — NRSC Chairman John Cornyn on Wednesday morning agreed to donate $42,000 toward O’Donnell’s campaign and to evaluate future funding at a later date. This was smart damage control, but to many conservatives, the damage had already been done.

Moreover, the GOP has not just offended O’Donnell but has gone out of its way to offend her Tea Party supporters across the nation — folks who were already highly skeptical of the party establishment.

Similarly, Castle’s decision to withhold his endorsement was unchivalrous, and the fact that his staff continues to throw stones, referring to O’Donnell as a “con artist,” is inexcusable.

It’s not just inexcusable, it’s inexplicable. It’s as if everyone forgot why we have primaries in the first place. This has been a gut-check moment for Republican leadership, and with a few exceptions, they have failed it.

SOURCE

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Retirement Fund Trillions Lure Government Grabbers

Is the government making plans to confiscate your retirement money? The Obama administration is certainly exploring the idea.

This question no longer seems far-fetched when the group-thinkers in Washington unabashedly promote a doctrine of wealth redistribution and central planning. These Keynesian socialists know they will need vast new sources of revenues to fund their relentless spending binges to "transform" this nation. A logical next step would be to legitimize the confiscation of private retirement assets -- an idea that was contemplated in the recent past by the Clinton administration.

According to the Investment Company Institute, there was $7.835 trillion in IRA, 401K, 457, and 403b accounts in 2009. That is certainly too large a sum to be ignored by the big spending social engineers in Washington. Bureaucrats and politicians have been hard at work formulating a social justice excuse to legislate an historic seizure of private assets. This would not be the first time the statists extorted wealth from U.S. citizens on a massive scale.

The public shakedown always employs a two-step tactic to repeatedly dupe the malleable electorate. First, the statists fabricate and incessantly excoriate a contrived crisis of social injustice that is victimizing helpless and unknowing Americans. Next, they "craft" -- a term Pelosi uses again and again -- insidious legislation disguised as a necessary and compassionate solution that makes participation and universal funding compulsory by force of the law.

It is a simple and effective strategy that continues to trip up even the staunchest conservatives, who ultimately succumb to the throng of propagandized constituents demanding protection from the newly revealed threat. Patrick Heller warns:

Expect to see terms such as "retirement income protection" thrown around. It is highly likely that such a program would be implemented in steps to help overcome public opposition. The US government plan is to eventually take ownership of all assets in IRAs and 401K accounts and replace them with US government "Treasury Retirement Bonds." In the October 2008 hearings, it was proposed that these bonds pay a 3% interest rate. Another major change is that, upon retirement, the individual's retirement account would be converted into an annuity. Once the individual is deceased, the individual's heirs would not inherit anything.

Has personal responsibility and self-reliance been transformed into a perceived disadvantage? Our benevolent government seems to think so.

In February, the U.S. Department of Labor's Employee Benefits Security Administration (EBSA), in collaboration with the Department of Treasury, announced a "request for information" to study the Lifetime Income Options for Retirement Plans and asked "for ideas on how to help reduce the chances that workers will run out of funds during their retirement years."

This request signals the "starting point" for launching yet another spurious social justice crusade by these two agencies. The fictional victims and the offending policy have been manufactured and publicized, and now it is time to fire up the propaganda machine and work on a new, expansive social engineering plot.

More HERE

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ELSEWHERE

Fidel Castro and American statism: "Cuba’s president Fidel Castro is surely making American liberals extremely nervous. Mugged by reality, Castro is moving his country in a direction away from socialism, at the very same time that American liberals are trying their best to move the United States further in the direction of socialism. Castro has a much firmer grip on reality than American liberals.”

Tricks against trade: "Public Citizen’s Global Trade Watch is up to its tricks against trade again. Noted for its past expertise in destroying the Seattle WTO negotiations, the group is now taking a new stance against free trade agreements (FTAs), though not by their usual rhetoric that they cost jobs and a ‘race to the bottom.’ Their new approach is that FTAs actually lower exports. The group just published a ’study’ purportedly showing that exports to countries that have free trade agreements with the U.S. showed less export growth than did exports to countries that don’t have FTAs.”

What if this were Bush?: "It goes without saying that if Bush had presided over a phony end to the Iraq war, expanded the Afghanistan war, extended its reach into Pakistan, solidified the state secrets doctrine and claimed in no uncertain terms the right to assassinate American citizens without due process, the left would be up in arms. The partisan hypocrisy concerning war-related issues is clear.”

Tools for liberty-loving radicals too? "Conservatives today often denounce Alinsky as the demonic wellhead of the modern Left, a claim that’s easier to make when you don’t know much about Alinsky’s actual ideas and activities. (I have even seen efforts to link the man to Antonio Gramsci, an Italian Marxist who plays a mysteriously large role in several contemporary conspiracy theories.) It doesn’t help that Barack Obama started his political career as a community organizer in Chicago, where he supposedly drew deeply from Alinsky’s social vision. Alinsky’s 1971 book Rules for Radicals has been studied closely by conservatives convinced that they’ve found the White House’s secret playbook. Smarter folks on the right, such as the Tea Party champions at FreedomWorks, have been reading Rules for Radicals as well, not to decode Obama’s occult intentions but in hopes of adapting Alinsky’s tactics to the fight for freer markets.”

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The Big Lie of the late 20th century was that Nazism was Rightist. It was in fact typical of the Leftism of its day. It was only to the Right of Stalin's Communism. The very word "Nazi" is a German abbreviation for "National Socialist" (Nationalsozialist) and the full name of Hitler's political party (translated) was "The National Socialist German Workers' Party" (In German: Nationalsozialistische Deutsche Arbeiterpartei)

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