Tag Archive | "Tea Party"

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Sequester: Main Street loses, Wall Street Gains


From whatever point of view you see the sequester impasse, the inability of Washington politicians to put aside the interests of a few in order to serve the people should unsettle markets around the globe. Given that the American consumer drives so many global economies, and especially the US economy, the prospect of massive pay decreases and layoffs should unnerve the strangest of souls.

It sure didn’t seem to bother millionaire Speaker of the House, John Boehner, who seemed delighted that he had received 98 percent of what he set out to accomplish with the impasse. It didn’t bother Mitch McConnell, Minority Leader of the Senate.

And, it didn’t seem to bother the members of Congress who packed their bags for a nice long weekend away from the stress of listening to each other do nothing. Happy days are here again for Congress as smiles  were aplenty after another tough, short workweek, a condition that about 750 million Americans are likely to experience by the end of 2013.

Markets Not Surprised By Dysfunctional Congress

Even the markets realize how dysfunctional Congress is and responded to the expected stalemate without blinking an eye. Wall Street has given up on Congress, taking an “assume the worst” mentality.

On Friday, US equities moved higher despite Congress and the sequester impasse. The USD gained against the euro, against British Sterling and the yen. The DOW gained 35.17. The S&P gained 3.52. Take that Boehner and crew.

Actually, let’s be clear. John Boehner has no idea what he wants. He is not calling the shots. He, himself, is hostage to a group of radicals that American taxpayers have elected and who have a mustered about a 10 percent approval rating. If you think they care, you are wrong. The Ryan–Cantor-Palin Tea Party radicals are up to their old tricks.

Despite Obama’s reelection, the Tea Party fears for their lives and has become more intransigent, not less. These politicians prefer the interests of their contributors to the interests of their constituents. Just as they have done for the past two years, these guys think the goal is to not permit any Obama legislation.

Their mission has nothing to do with the best interests of their constituents. Their mission has everything to do with the interests of their campaign supporters most of who do not live in their districts. When it comes to Republicans, money talks, morality walks.

The sequester impasse is enough to make one wonder where the economy would be if Congress just disbanded permanently and we didn’t have to listen to anymore. How much could we save without paying these people, their benefits, luncheons, fitness center upkeep and membership, airfare, staffs, medical benefits, pensions, etc. Why are we not talking about those ridiculous expenses?

Republicans Celebrate

A small group of radical GOP conservatives have taken the American public, and the world’s biggest economy hostage. While Boehner, McConell, Ryan and Cantor are taking bows for resisting an approach to deficit reduction that the majority of taxpayers and a bigger majority of economists agree are unsustainable, the country has an excellent chance of another Republican forced recession.

And, guess who is really to blame? Yup, the blames is squarely on the people who voted these radical Congressional member to office, you and me. We are all to blame. We let these self-indulgent, lazy and self-important fools pontificate about their wonderfulness and vote them into office despite a ten percent approval rating.

Let’s be clear. If you are down and almost out, you are in trouble. The Republicans idea of fixing Medicare is to deny elderly medical benefits.

What the sequester presents the American public is probably not a short-term disaster. The long-term could be another problem. But, Congress and Wall Street do not worry about the long-term. They make profits and get re-elected based on the short–term. The long-term bothers President Obama and the people living on Main Street.

So, these are the battle lines; Obama and Main Street vs. Congress and their special interests. A vote for Congress is a vote for special interests on both sides of the aisle.

When the short-term is threatened, equities fall. When the long-term is compromised for short term gains, markets go up.

What a formula for disaster. The Tea Part could care less about Main Street. They talk a good game about the long-term, but don’t kid yourself, that is not their guiding light. They figure if they keep squashing Main Street, they appeal to a certain group on contributors who will get them reelected.

In the Halls of Congress, that’s the name of the game, nothing more, nothing less.  How could anyone want such a job, one that comes at the expense of your own morals, hits the communities you live in very hard and causes pain to 95 percent of voters?

When will the American voter wake up? Maybe after the next recession, enduring the risks of criminally weak defense and education systems, the voters will rise up.

At some point in time, Main Street had better learn to stand up for itself. If you do not change Congress, you deserve what you get. Let’s hope we have a country left by the time Main Street wakes up.

John Boehner and the Tea Party got 98 percent of what they wanted from the sequester impasse, did you?

 

 

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Republicans Reeling, Boehner Surrenders


Republicans Reeling, Boehner Surrenders

House Majority Speaker, John Boehner, supposedly the most powerful Republican politician in the country, met his match Thursday in an embarrassing non-vote that once again demonstrates the ineptitude of the conflicted GOP. Boehner did not absorb the humiliating lack of support for his Plan B solution well. To put an end to the Republicans self-destruction mode, Boehner dismissed the House for the Christmas Holiday burying his head in the sand and leaving a concerned middle class wondering “who are those guys?”

Boehner turned the reins over to the Senate and President Obama and left middle class taxpayers hanging out to dry. The conservative Tea Party refused to support Boehner in his hour of need, making very clear that there are at least three political factions working against each other in Congress. While it is easy to criticize the politics, the middle class will pay their dues for not ousting Republicans from the House and Senate in the 2012 elections. The price will be a self-inflicted recession.

It is painfully clear that the majority of Republicans are more interested in standing behind Grover Norquist and the wealthiest 0.005 percent of the voting public than they are about preserving the nation’s credit rating or preventing a recession that could make the 2008 recession pale.

If there was ever doubt about the mechanics of Washington, they should be eliminated now. The international community appears a smoothly operating engine compared to the dysfunction that threatens to take the country apart. On the heels of the tragedy in Newtownn, Ct. Americans are struggling for identity socially, economically and financially. The morale of the country is low and the state of mind for middle class America, the apparent conscience of the country, is distraught. Soon to be bombarded by irresponsible tax increases, massive layoffs and more irresponsible politics, American consumers will hit the crisis mode when the bills for holiday shopping arrive. The middle class can soon look forward to working half the year to pay new taxes and new healthcare levies.

It’s a disaster. A disaster caused by political subsidies, self-interest and the absence of moderate politicians.

Senate Republican Leader, Mitch McConnell had the audacity to call the failure of his party to embrace a real problem, the President’s fault. In another self-serving, stumbling statement from the aged Republican, the Republican leader continued the rhetoric that has accomplished nothing in three years.

The Republican Party is broken and the sooner Americans fight back, the better. This is an inexcusable breach of the public’s trust. Last Monday, Boehner and Obama came to a sweeping tentative agreement. When Boehner returned to the dark corners of the House offices, the deal fell apart rapidly.

Boehner has no control He has fallen from the most powerful Republican in Washington to the depths of an impotent fraud, like the party he represents. Wake up America! This is a disgrace and if you do not pick up the phone and ruin Christmas and New Year’s for your representative, you have no one but yourself to blame.

 

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Republicans Hide Behind Divide


The only thing House and Senate Republicans have agreed upon since 2010 is their commitment to derail the President of the United States. With new unemployment numbers dropping to 7.7 percent, Republicans are awash. They were slammed in the 2012 elections and face the very real possibility of losing control of the House in 2012 and losing more seats in the Senate.

Republicans have resorted to the party of bullying and groundless accusation and have proceeded with chaotic disrespect for governance. They have betrayed their constituents, the credibility of the United States and the national economy and the rest of the world. You see being a politician is being a representative of your constituents. The Republican Party has forgotten that.

It has never been more clear that the self-interest of padding the pockets of Republican donors is more important than correcting the mistakes the GOP committed during the Bush Presidency.

Try as they might, the Republicans appear more and more futile with every passing day. Would someone please put John Boehner out of his conflicted misery? Let creepy objectionist, Eric Cantor or the ridiculous recent Vice Presidential hopeful Paul Ryan, who lost a debate to Joe Biden, take center stage. Either of these jokers will ensure the unseating of more Republicans than Boehner could ever manage.

News that the dysfunctional party intends to oppose Senate Minority Leader Mitch McConnell with a Tea Party candidate shows exactly how desperate the party has become. Heavy doses of Viagra cannot help the dysfunctional existence of their enduring shortcoming and a driving propensity to greed that overrides every rational thought. It is a hard thing to witness when a party cannot get it up in terms of leverage. They pontificate. They make excuses. They pray for mistakes by the other side and they never come up with a solution or a positive idea.

Would someone tell these jokers that they lost the election? The American public rejects them and their brand of favoritism and the rejection increases every day. The people that represent the Tea Party are just short of medically insane; they try the same routine over and over and expect a different result.

Thankfully, the fiscal cliff is highlighting the flaws of this dysfunctional party. Business, society, voters, educators, physicians, retirees, the poor and the sick completely understand the insanity.

Regrettably, we will have to go over the cliff to make life so miserable for their followers that they stand up and reject the party entirely. It is going to happen. If the party does not agree to a tax rate hike for the wealthy 2 percent, we lower income earners are going to feel pain, lots of it. At least we will know once and for all without any political gyrations where the blame belongs.

There is a bill in Congress that has been passed by the Senate that can end the stalemate right now. Boehner, Cantor and Ryan cannot bear to bring this to a vote because it will name exactly who is forcing the country off the cliff.

In one way, we should all be grateful for this battle. Yes, the Christmas retail sales will be down. The GDP will suffer. We will pay higher taxes. The rich will pay much higher taxes. But, if we could be rid of the egomaniac known as Grover Norquist and hopefully all his subscribers, it just might be worth it. Yup, we are going to have to pay for the sins of the Republican Party just the way they planned.

We are used to it. If I never have to see Eric Cantor’s smugness or hear Paul Ryan struggle to contrive more lies or hear Boehner offer more hollow accusations or listen to McConnell’s feeble demonstrations, paying more taxes will be worth it. In two years, Obama will have the horses and we can kiss the Koch Brothers.

The only thing House and Senate Republicans have agreed upon since 2010 is their commitment to derail the President of the United States. With new unemployment numbers dropping to 7.7 percent, Republicans are awash. They were slammed in the 2012 elections and face the very real possibility of losing control of the House in 2012 and losing more seats in the Senate.

Republicans have resorted to the party of bullying and groundless accusation and have proceeded with chaotic disrespect for governance. They have betrayed their constituents, the credibility of the United States and the national economy and the rest of the world. You see being a politician is being a representative of your constituents. The Republican Party has forgotten that.

It has never been more clear that the self-interest of padding the pockets of Republican donors is more important than correcting the mistakes the GOP committed during the Bush Presidency.

Try as they might, the Republicans appear more and more futile with every passing day. Would someone please put John Boehner out of his conflicted misery? Let creepy objectionist, Eric Cantor or the ridiculous recent Vice Presidential hopeful Paul Ryan, who lost a debate to Joe Biden, take center stage. Either of these jokers will ensure the unseating of more Republicans than Boehner could ever manage.

News that the dysfunctional party intends to oppose Senate Minority Leader Mitch McConnell with a Tea Party candidate shows exactly how desperate the party has become. Heavy doses of Viagra cannot help the dysfunctional existence of their enduring shortcoming and a driving propensity to greed that overrides every rational thought. It is a hard thing to witness when a party cannot get it up in terms of leverage. They pontificate. They make excuses. They pray for mistakes by the other side and they never come up with a solution or a positive idea.

Would someone tell these jokers that they lost the election? The American public rejects them and their brand of favoritism and the rejection increases every day. The people that represent the Tea Party are just short of medically insane; they try the same routine over and over and expect a different result.

Thankfully, the fiscal cliff is highlighting the flaws of this dysfunctional party. Business, society, voters, educators, physicians, retirees, the poor and the sick completely understand the insanity.

Regrettably, we will have to go over the cliff to make life so miserable for their followers that they stand up and reject the party entirely. It is going to happen. If the party does not agree to a tax rate hike for the wealthy 2 percent, we lower income earners are going to feel pain, lots of it. At least we will know once and for all without any political gyrations where the blame belongs.

There is a bill in Congress that has been passed by the Senate that can end the stalemate right now. Boehner, Cantor and Ryan cannot bear to bring this to a vote because it will name exactly who is forcing the country off the cliff.

In one way, we should all be grateful for this battle. Yes, the Christmas retail sales will be down. The GDP will suffer. We will pay higher taxes. The rich will pay much higher taxes. But, if we could be rid of the egomaniac known as Grover Norquist and hopefully all his subscribers, it just might be worth it. Yup, we are going to have to pay for the sins of the Republican Party just the way they planned.

We are used to it. If I never have to see Eric Cantor’s smugness or hear Paul Ryan struggle to contrive more lies or hear Boehner offer more hollow accusations or listen to McConnell’s feeble demonstrations, paying more taxes will be worth it. In two years, Obama will have the horses and we can kiss the Koch Brothers.

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Fiscal Cliff Stalemate


Please forgive my political ignorance, but why do we not have a solution to the fiscal cliff? Just about every CEO in the country is pushing for a balanced resolution. The President returned to the White House with a clear mandate to raise taxes for 2 percent of the country. This concept is approved by more than 60 percent of the population, a larger percentage of the population than voted for the President.

John Boehner knows a compromise is needed and that failure will turn from the majority party in the house to the minority in the two-year House elections. Senate Minority Leader Mitch McConnell begrudgingly admits the Republican stance is too conservative. In fact, Boehner’s and McConnell’s jobs are reportedly on the line. The Tea Party is on trial and will render itself extinct if Republicans do not free up the economy.

For some reason, a group of Tea Party and Norquist Pledge supporters are still placing the welfare of the country ahead of their commitment to the people. I believe in the two party system but we should realize that there are three parties in Washington. The least effective lobby is the centrist Republicans. It will take these Republicans to pass the existing legislation that the Senate has passed and Republicans in the House refuse to bring to a vote.

Over the weekend, talk show television has been filled with discussion about the President’s proposed solution to the Fiscal cliff. Mainly, increasing the taxes on the country’s wealthiest 2 percent, about $400 billion in budget cuts, a request for $50 billion in job stimulus funding and that the debt ceiling limit not require congressional approval.

This is a framework that taxpayers at all levels understand and approve. It leaves social security, Medicaid and Medicare untouched, which is a legitimate problem for Republicans. McConnell threw in a few suggestions for these programs that make sense. He suggests raising the benefit age for social security and Medicare. McConnell also suggests higher Medicare and social security payments by the wealthy. And, he talks about cleansing the Medicaid and Medicare systems. These are valid points and while Obama won the Presidential election, he did admit that these programs need reform.

So, why can an agreement not be put in place immediately? Why do politicians feel it is necessary to drag things out to the last minute? Do we have to suffer this political theater at every turn? Is Washington so sheltered that they do not understand the problem or do our elected officials lack the courage to do what is right for the country? For the majority of House Republicans, embracing a balanced solution means reneging on the Norquist Pledge.

On Meet The Press, Senator Claire McCaskell asked, “who is Grover Norquist?” How could a person who is not an elected official have a death grip on the Republican Party and the nation. For two years, the 112th Congress, the least effective Congress in the history of the Republic, has held the American people hostage to their whimsical pledges.  It is time to own up to a failed agenda and get this country moving. The way our Congress acts is an embarrassment to democracy and the world. Who, in their right mind, would invest in a country that is who economy is handcuffed buy government?

Like it or not, President Barack Obama was re-elected. He is not going to be swayed from his campaign promise or from Boehner, whose credibility is already a hindrance, misleading and conflicting statements. The fact is Boehner cannot deliver his party to a meaningful compromise. Mrs. Boehner, Cantor, Mitchell and Ryan may well be burying their political aspirations because of cliff negotiations fail, they will be held accountable for the upcoming recession.

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The Fiscal Cliff Countdown Starts Now


An election weary US private sector has had little time to rest before Republicans and Democrats prepare to launch negotiations about the pending Fiscal Cliff on December 31, 2012. Just two days after the election was decided, the airwaves are filled with pending negotiations between the House’s Republican leader, John Boehner, and the President.

The real question is whether voices of reason will prevail or whether the gridlock that has consumed Washington for the past two years will be put aside in favor of the people’s best interests. Republicans immediately asserted that Obama’s election win was not a mandate but the Republican Party is under attack and a failure to bring about a meaningful deficit reduction plan will be viewed with disfavor by big business, the US citizenry and the international community. None of these entities wants a band-aid.

Grand Bargain, Not a Band-Aid

If a “kick the can initiative” is agreed upon, Republicans will be blamed. If a plan that touched the surface or kicks the issue down the road is implemented, it will be Republicans that pay their dues in 2012 elections.

Americans realize that the time to pay for the sins of the past is now. That means across the board cuts, balanced by revenue increases. American business wants a package that dwarfs Simpson-Bowles and really goes after the deficit in a meaningful way.

There will be tax increases. There will be changes to Medicare, Social Security and Medicaid. The sequestered cuts to be implemented January 1, 2013 will be pushed aside in favor of a broader program.

Republicans hold the majority in the House but the American public has spoken and the House cannot be trusted to implement a positive change. Democrats had 23 seats at risk in the last election and to the surprise of Republicans actually gained seats.

Will The Tea Party Grow Up?

On Thursday, Boehner was more conciliatory than at any time in the past. Whether his voice has support of the Tea Party is another problem. However, President Obama has the backing of the US people and is not running for office in three years. This is a stronger leader than when Boehner and Senate Republican Leader McConnell said two years ago that they would dedicate themselves to making sure that the President was not re-elected.

Yet, in Washington there is a sense that both parties and all three wings of government are tiptoeing on egg shells. It is critical that there negotiations get off to a positive start. This can soothe investors and the business climate or a negative first impression can unnerve US business and international markets.

President Obama has been clear that the goal is not a small initiative. The President wants a “grand bargain” and it is doubtful he will settle for anything less. One important undertaking is expected to be revisions to the US tax code. This can have big implications for progress.

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Ryan Budget Winners And Losers


House Budget Committee Chairman Republican Paul Ryan has released his proposed Budget, which is now winding its way through Congress.  The Ryan Plan is an unusual proposal for an election year but will most definitely serve as a battleground for all Congressional and Presidential races.  The three main Republican presidential candidates have all endorsed Ryan’s budget. It is unknown if any of the three has read the document.  This is not exactly the best time to break from party politics.

 Senate majority leader Harry Reid, who has read the plan, has already said the budget would fail in the Senate.  In his explanation, Reid cited the budget cuts passed last year.  Democrats hold that the standards in that budget were in fact the law in terms of budget expenditures.

The political reality is that neither last year’s plan, nor a revised plan from Speaker Boehner nor Congressman Ryan’s plan has any hope of passing.  In efforts to take pressure off Republicans running for office, Boehner and Tea Party sidekick Eric Cantor have entered into discussions of adding just $19 billion in additional austerity cuts to the existing budget.  This proposal has drawn sharp criticism from fiscal conservatives of the Tea Party and from Democrats who believe last year’s deal clearly set the nation’s course. 

Ryan’s plan has some appeal to the Tea Party faction but to many Republicans, the Ryan plan does not go far enough.  An interesting comment by an aide identified as working for a Republican leader on the Conservative Study Committee said, “I’d say that’s probably not going to be enough for my boss.”

It is an innocent and most likely a truthful response but it highlights who the boss really is.  The boss should not be Grover Norquist, the Tea Party, the Republican Party or the Democratic Party.  The boss is we-the-taxpayers. 

This is precisely the mentality that Warren Buffet addressed in his move to declare that any time the deficit exceeded 3 percent of GDP, the entire congress should be prohibited from running for office ever again.  Buffet also suggested that members of Congress have exactly the health insurance as do taxpayers.  Congressional benefits are completely disproportionate to the benefits taxpayers enjoy. 

Buffett’s movement would also restrict the future income of members of Congress.  When they leave Washington, they are unemployed and can either get a job or try to collect unemployment insurance.  Congress should not receive the generous retirement benefits reaped by even one-term members.

Anyway, Boehner and Cantor began trying to dial down the rhetoric earlier last week.  Apparently they are very comfortable with the divisiveness that has made this Congress the most unpopular in American history.

Reid threw fuel on the fire saying that, “Our economy cannot afford another one of these senseless demonstrations by the Tea Party.  The American people are sick of these manufactured crises.”  In the wake of improving unemployment, a successful Democrat sponsored Payroll Tax reduction and a successful unemployment extension, Republicans are now shifting to the deficit as a campaign model.  Reid claims the GOP has resorted to reneging on their commitments last year.

Ryan Budget vs. Obama Budget

Ryan’s 100-page budget is in sharp contrast to Obama’s budget.  Ryan’s plan would cut $5 trillion in total federal spending over the next ten years.  There are distinct differences on a number of fronts. 

  • The Ryan budget would call for the national debt to reach its ceiling of 77.6 percent of GDP in 2014.  Obama’s debt level would hit 80.4 percent by the end of 2014. 
  • The Ryan plan would reduce debt steadily to 62.3 percent by 2020.  For the same period, Obama’s plan will level in 2018 and remain at 76.3 percent in 2020. 
  • At the end of ten years, the Ryan plan will have lowered the debt along the way.  Under the Obama plan, the debt would maintain the 76.3 percent level after 2018.

Ryan and many Republican Congress persons and all three Republican presidential candidates like Ryan’s budget.  The Ryan Budget contains other key components that are far apart from Obama’s plan.  One of the most important aspects of the budget is the stark reality of income.  Federal government income amounts to just 18 percent of GDP.

Ryan offers few increases for the federal coiffures.  His plan would continue the Bush Tax cuts and yield more than $1 trillion in tax savings for the country’s most wealthy individuals.  Obama’s plan would call for the country’s wealthiest individuals to shoulder more of the burden by increasing their taxes substantially.

The Ryan plan also calls for the elderly and the poor to shoulder much of the austerity cuts.  Government health costs amount to 5.6 percent of GDP.  All, other government discretionary spending amounts to 17.1 percent of GDP. The aspect of government that has grown the most is healthcare.

The Congressional Budget Office (CBO) estimates that healthcare spending under the Obama-Care legislation and with other entitlements will increase health costs to 10.4 percent of GDP.  The CBO indicates that the Medicare model will be out of money in ten years.  President Obama has credited his program for keeping the cost of health care in alignment with inflation rates.

Under Ryan’s plan, Medicare recipients would receive a stipend which seniors can use to offset the cost of private insurance.  Basically, Ryan will take rising health care costs out of Medicare offering by privatizing the expense.  Ryan calls for physicians and hospitals to sharpen their pencils in arriving at the cost of services.  Most physicians feel they lose too much money with Medicare.

Obama’s plan favors fee-for-service programs.  The Democratic platform dictates that changes to Medicare should be modest.  Touring in Florida, Vice President Biden informed his audience that Ryan’s plan will create dramatic changes in Medicare, Social Security and Medicaid benefits for the most need Americans.

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Tea Party Causes Equity Tank


Rating Agency S&P warned the adults in Washington that failure to reach a quick, decisive and balanced resolution to the debt crisis would taint the country’s AAA credit rating. Tea Party Republicans blocked passage of the Obama – Boehner $4.3 trillion deficit reduction plan and settled on an idiotic plan that fell far short of the necessary targets that would have protected the AAA rating.

The Tea Party then made a quick escape from Washington, leaving the fate of 74,000 workers unresolved. That act exemplifies the irresponsible posture of the Tea Party and the Republican members in the House of Representatives. The fate of the 4,000 FFA workers and 70,000 laborers meant little to the Republican House. Had it not been for the President and the adult Senate members, those workers would still be unemployed.

Republican Presidential candidate, Michelle Backmann supported the Tea Party Republicans. With the mess that exists in Washington, it is hard to point fingers. Let’s start with the fact that Standard and Poor’s did what they said they would do. At the end of the day, the rating agency did the honest thing. They girded their loins and took action that reflected the lunacy if Congress. The House of Representatives and John Boehner rolled over to the Tea Party caucus. What type leadership is that? The Republican leadership looks like thugs that took seats from women and children on the survival boats as the Titanic went down.

DJIA Chart (us!dji)

Boehner should revisit the third grade and remember that a man of words and not of deeds is like garden of weeds. In the end, the Speaker of The House was more interested in holding his titular role than serving “we the people.”

To add salt to the rating debacle, another intransigent Republican, Majority Leader and Tea Party favorite, Eric Cantor made Standard and Poor’s look right on the mark when he announced Sunday that his caucus would not support the extension of unemployment benefits to more than 7 million Americans. Where does the insanity end? This is the next gun Cantor will attempt to hold to the head of the President’s and the collective heads of the American people.

When questioned, iron man Cantor, said the unemployed should find jobs. However, Cantor and his Tea Party thugs, have never submitted any proposed jobs bills. The standard Republican response to the jobs crisis is. “extend the Bush Tax Cuts and let the job creators do their magic. That would be the same magic that brought the economy to its knees and resulted in 750,000 layoffs per month at the end of the Bush presidency.

The Republicans negotiated the current extension by holding the fate of 7 million unemployment recipients under the gun. Obama gave in last year. We can only hope that he stands firm this time around and allows the Republicans to cause the discontinuation of benefits during the upcoming election year.

The Republicans who have signed the Norquist document agreeing to vote no on any taxpayer increases have succeeded in crippling taxpayers, setting fire to the equity and commodity markets, destroying our credit rating and spitting in the face of their own base.

U.S. Equity Markets Tank

All those courageous and self-proclaimed economic geniuses, aka Republicans, sent the equity markets into a deep 6.5 percent dive. All 500 stocks on the S&P were down in the market’s worst collapse since December 2008. In an exercise of futility, analysts unsuccessfully tried to quell worried investors.

The Dow Jones Industrial average fell 634.76 points or 5.5 percent. The NASDAQ lost 174.72 points or 6.90 percent. The CBOE volatility index surged 50 percent to 48. The S&P financial index fell 10 percent. The S&P energy index fell 8.3 percent. Bank of American shares tumbled 20 percent and AIG prepared to sue the troubled lender for $10.

Trading volume was 17.89 billion shares on the New York Stock Exchange, the American Stock Exchange and NASDAQ. The volume was twice the daily average for the year.

Highly regarded James Paulsen, the chief investment strategist at Wells Capital Management in Minneapolis was succinct, “It is a panic, and almost by definition, it doesn’t have an issue. It wouldn’t matter what it was.”

So, here we are. The House is on an undeserved vacation. Tea Party activists are dancing in the street and intending to deny at least 7 million citizens unemployment benefits and soon U.S. troops will be returning to a nation that cannot assure them of jobs or income.

But, all must be well, because those great job creators have another year to create jobs like they have done this year. You betcha! As Eric Cantor said, those unemployed workers should get a job. They don’t want unemployment, they want jobs. It sounds so simple that Majority Leader Cantor sounds the simplistic moron that he is. How many Republican presidential candidates would want his endorsement?

One thing is very clear. Any one of those unemployed workers could do Eric Cantor’s job and any Tea Party House member’s job as well as the incumbents are. These are the politicians who said default would not hurt the U.S. and that credit ratings did not matter. Most likely, they were betting against the equity markets. Perhaps that is more credit than they deserve?

Soon, those idiots will be back in Washington and begin to blame the President for his lack of leadership. That must be it because it could not possibly be that the Party of No misjudged the repercussions.

Out of curiosity, how many jobs will the “job creation party of no” be adding now? Hello, Mr. Cantor and Marshmallow man of words and no deeds Boehner, we do not hear you?

While efforts by the ECB to boost bonds from Italy and Spain prevented a total collapse of the Euro Zone, this was the hour that the world’s largest economy could have come to the rescue as the United States always has. But, no it was not to happen.

The Tea Party achieved their goals of crippling the economy and undoubtedly boosting unemployment. Instead, the nation, that can get the job done if our hands aren’t tied behind us, is lying listlessly in the dust and ashes that was once the Grand Old Party, now known as the Tea Party Crashers.

I remain Proud To Be An American, Ashamed To Be A Republican.

 

 

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U.S. Loses Credit Game


In an event that could not be a complete surprise, the AAA credit rating of the United States was downgraded by Standard & Poor’s on Friday.  As squabbles within the European Union mixed with the childish conduct of Republicans in the House of Representatives merged with discouraging economic indicators, the environment for a perfect storm came together. The result was a credit downgrading.

In the wake of a New York Times – Wall Street Journal poll, 82 percent of Americans voiced negative ratings for the way Congress was handling the people’s business.  In recent battles over the credit limit extension, Americans saw the painfully ineffective operation of Congress.  A small group of dissidents were out of control and thought nothing about jeopardizing the status of the credit rating for the world’s largest economy.

The Tea Party Republicans opposed all proposals from Republicans and Democrats and stonewalled legislation that could have prevented the downgrade.  As a result, American taxpayers will shortly be forced to pay higher interest rates on credit products.  The Tea Party scored a big win through their refusal to represent the interests of taxpayers and now the American voters will pay the price and bear the burden.

A statement from the rating agency said, “The downgrade reflects our opinion that the fiscal consolidation plan that Congress and the Administration recently agreed to falls short of what, in our view, would be necessary to stabilize the government’s medium-term debt dynamics.”

The rating agency’s job was made easier as the House of Representatives left for vacation leaving 70,000 construction workers on FAA projects and 4,000 FAA employees without funding.  The Republican Party was unwilling to approve FAA funding in targeted areas where Democrats held office.  Between the Senate and the President, the FAA funding was restored and 74,000 employees will return to work next Monday.

Just when Americans felt they had seen the worst, along came the Majority Republicans number two, Eric Cantor.  He may be on vacation but the majority leader declared that the House would not support extension of unemployment benefits to the unemployed.  When questioned, Cantor said the best thing that unemployed workers could get was a job.  The signal for the political posturing that will resume when the House reconvenes was loud and clear. 

This proclamation is merely one more episode where a minority in one third of the three branches of government intends to hold the government hostage for the third time in less than a year.  This time around, the Republicans, who have not proposed one jobs bill, may meet stiffer resistance from the President. 

While there are Tea Party supporters out there, they are not the unemployed or the poor or the elderly.  Frankly, Tea Party hostage takers and political terrorists must be voted out of office as quickly as possible. 

President Obama’s spending and revenue increase $4.3 trillion compromise package that Speaker of The House John Boehner helped craft very well may have averted the ratings downgrade.  However, Boehner was rudely dismissed by the Tea Party when he discussed terms of the proposed legislation within his caucus.

The message is clear.  The Republicans support tax cuts for corporations and individuals rather than pay for care to the needy, the elderly and the unemployed.  They continually represent that the Bush tax cuts will create jobs but after 8 years of George Bush and his tax cuts, unemployment was escalating out of control.  New jobs did not appear because of the tax cuts.

Volatility Is The Word

As volatile as the dysfunctional Congress is, it appeared Europe was undergoing its own disaster in Friday.  In one hour, the Dow Jones average swayed 400 points. Originally buoyed by a better than expected non-farm payroll report, the word for the euro zone that Italian and Spanish bonds were not to be supported by euro zone members.

As the day went on, the European Central Bank urged patience while cooler heads prevailed.  Eventually, the European Union reported that a deal had been made and that the ailing bonds would be supported by neighbors.

Global markets are still seeking balance after one of the most volatile days since the recession began.  Markets are frustrated and other nations are using the Congressional hearings as nighttime comedy. 

The Tea Party has achieved their goal. The world’s biggest economy has been brought to its knees.  Taxpayers might have thought China, Germany and Brazil might have lowered our status in the world. 

Little did taxpayers suspect that Congress would accomplish what competitors in global markets have never been able to accomplish.  I regard myself as a proud American.  Until recently, I was a Republican.  I regret my two votes for Bush and could not support a McCain – Palin laugh in campaign.

I guess that makes me a proud American and a shamed Republican.

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Debt Deal – Everybody Loses


After the Senate passed the exhausting debt ceiling extension by a majority of 74 – 29, angry and disillusioned Americans have emerged from the process.  A Washington Post survey asked taxpayers how they felt about the debt ceiling debate.  The immediate response from the majority of those interviewed was “ridiculous.”  The next two most popular responses were “disgusting” and “stupid.”

In 2010, voters made it clear that they were disenchanted with the House and with the Senate.  Americans empowered Tea Party candidates who promoted fiscal responsibility and shrinking the size of government.

The Tea Party’s no compromise position placed the country’s credit rating at stake and clearly established a component of the Republican Party that is far right and most likely to vote “no” on all legislation.  More than representing taxpayers, Tea Party activists have preventing Obama a second term is their primary goal.  That may well come at the expense of the needy and seniors.

This particular Congress has proven to be the least effective Congress in history.  As the country tackles a huge jobs problem and a double dip in the housing industry, this Congress has only passed 60 of 260 legislative bills.

After a first hand look at the scene in Washington, the American taxpayers on Main Street witnessed the dysfunction that the Tea Party has created.  The most promising solution to the debt ceiling increase and budget deficit gap was structured by House Speaker John Boehner and President Obama. 

As happened to Boehner on at least three occasions, when he took the plan to his caucus, the unified Tea Party said no.  After each setback, Boehner launched torrents of aggressive language criticizing the President.

In truth, Boehner painted himself into a corner and he found his Speakership threatened by the Tea Party that had more control over the caucus than the Speaker.  On Tuesday before the Senate voted, Boehner continued his assault saying that dealing with the White House was like dealing with a bowl of jell.  Actually, Boehner was describing his own dilemma.

No Winners

There are no political winners in this legislation that passed the Senate at the 11th hour.  Fiscally, this bill does not satisfy the left or the right.  While the Republicans gained a compromise that there would be no revenue increases, the ace in the hole is held by Obama.  If he is re-elected, the President is certainly not going to approve an extension of the Bush tax cuts, which Republicans hold as the Holy Grail for job creation. Unfortunately, the Republican position is not valid. The Bush tax cut benefactors and “job creators” were nowhere to be found when the recession spiked.

Bush and his Republican cohorts turned Bill Clinton’s government surplus into a massive deficit that Obama has increased.  Federal Reserve Chairman Ben Bernanke is a scholar of the Great Depression.  His philosophy is that the government must spend its way out of the recession.

Bernanke and Obama are both under heavy criticism because while they spent plenty, they failed to create jobs.  Combined with the fact that there is no jobs program on the table now, Main Street is on the verge of large protest groups. 

The debt ceiling argument left most Americans wondering what the three-ring circus would do next.  Republicans attacked Obama about the jobs situation but offered no solutions as they once again held the President hostage.

The first time Obama was under the gun was in December.  At that time, Republicans declined to pass legislation to pay unemployment benefits to 7 million Americans unless the President approved the extension of the Bush tax cuts. 

On Main Street, the popular sentiment is that this is no way to run a business and certainly no way to manage the world’s biggest economy. 

Credit Downgrade

Immediately after the passage of the legislation, Treasury Secretary Timothy Geithner was scrambling to try to convince credit agencies that this plan was merely the beginning of serious efforts to trim spending.  By 2:00 p.m. only Standard and Poor’s was the last holdout to give the country a break.

While the bill details $2 trillion in spending cuts over the next ten years, the most important component is the establishment of a bi-partisan committee to recommend a deficit reduction package by late November.  Given the reality that there is now a three party system in Washington, this will be a challenging undertaking.

There is reasonable doubt that a committee can accomplish anything approaching the scope of the Simpson Bowles plan or the Gang of Six program.  Of course, this committee is headed for disaster, because Republicans will not support legislation that includes revenue increases and Democrats are determined to protect the middle class and the existing entitlement programs.

The good news for Americans is that the House is on break for thirty days.  The bad news is that when they return they will knock heads again on setting budget allowances for various divisions of government.  The appropriations legislation must be completed by the end of September.

What these vacationing congressmen are likely to face are unnerved voters in their districts.  President Obama expressed it correctly when he made a Rose Garden talk after the Senate vote.  Americans may have voted for divided government but they did not vote for dysfunctional government. Amen!

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Boehner’s Republicans Disrespectful


When Republican Eric Cantor rudely interrupted President Obama three times in a crucial June summit, the posture of the Republican Party was evident.  Urged on by a freshmen class of 60 new Congressional members, these inexperienced politicians have pushed the United States to the brink of default.  In the midst of this activity, a once highly regarded Speaker of The House, John Boehner, is not only damaged goods but is also incapable of controlling his own caucus and appears the villain in the debate.

The Tea Party’s stance has undermined the possibility of cooperation between the government’s three elements.  The Tea Party was widely supported by Wall Street and the Chamber of Commerce.  Those bodies may well regret their choices.

With five days left before the August 2nd deadline identified by Treasury Secretary Timothy Geithner as the day of default, the world is now paying closer attention to the normally easy process of raising the debt ceiling.  Due to unexpected revenue, the drop-dead date may be a bit later but that is not what is catching the eyes of the nation’s global investors.

From France to the IMF to Japan and even the Phillipines, nervous economies have been patient as reckless politicians have provided volatile bickering and downright untruthful statements.  The closest the country has come to resolving the debt ceiling and spending cut plan was a proposal crafted by Boehner and Obama that would have generated more than $4 trillion in deficit reduction plans and $800 billion in revenue increases.  Every citizen would give something in this plan.

The Boehner – Obama deal was set for release last Friday. The Speaker of the House Boehner avoided the President’s phone calls and then turned up the dialogue, claiming that Obama’s request for an additional $400 billion in tax changes for the wealthy made the plan unacceptable.  The truth is that Boehner could not sell the original deal to his caucus.

Just two months ago, Eric Cantor walked out of the Biden spending cut commission when the Republicans left the White House at the altar for the first time.  When Boehner backed out of talks for the second time last Friday, the President’s options were limited.  He is now waiting for a Boehner plan that would not have passed the House yesterday and is doomed for defeat at the Senate.  Obama has already said he will veto the Boehner plan.  The major problem with the Boehner plan is that it is a two-step process that will require more negotiation is six months, coincidentally at the same time the President will be on the campaign trail.

Boehner used Wednesday to refine his proposal but no matter what he suggests, it will not pass.  Majority Speaker of the Senate, Harry Reid, has a plan on the table that the President would approve.  This plan would increase the debt ceiling through 2012,and has about $2.7 trillion in cuts.  It is a compromise plan that not all Democrats embrace.

Though Obama will accept this plan, it is far from what the Democrats really want.  The Obama-Boehner plan that fell through was a far-reaching bill that addressed improvement to the entitlements programs and included certain revenue raising changes to the tax code.

Reid’s bill may pass the Senate and will most likely be rejected by the House.  At that point, Obama can veto the House and would only need one third of the House to overturn the House’s original vote. 

Another option is that the President can invoke the 14th Amendment. The country is so discouraged by the Washington malaise, that this possibility has larger than expected support.  What the President might consider is submitting a straight debt ceiling increase bill to the House and Senate.  This option separates the spending debate from the debt ceiling increase.  This bill would certainly fail in the House but might pass in the Senate. 

If all else fails, the President should not wait.  He should invoke powers in the 14th Amendment and increase the debt ceiling thus avoiding default.  In a CNBC poll, 96 percent of Americans supported the President’s use of the 14th Amendment.

While Boehner is being bullied by the Tea Party, the President has been busy behind the scenes.  On Wednesday, Republican Senator John McCain addressed the House and tried to educate the freshman members and Tea Party members. He may have made a dent in the unwillingness to compromise but tomorrow will tell.

Lingering on the sidelines, the Credit Rating Agencies are pushing for a long-term solution that includes the debt ceiling increase and the spending cuts.  It is remarkable that the Tea Party is driving Boehner and the nation. 

Invoking the 14th Amendment may cause a series of lawsuits but when the other options are exhausted, this may be the cleanest and only option.  The weight of this debate has mesmerized the taxpayers and financiers from around the globe.  The result is a tremendous slowdown with businesses and citizens wondering what will happen next.

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