Posted by Kendall Harmon

We start with this reality: Social Security and Medicare are practically sacrosanct. Nearly nine-in-ten Americans say they're good for the country. That's an amazing number. But the popularity of these programs really isn't all that surprising. People love them because they do what they were created to do. They ease many of the frets and dreads of old age – a blessing not just for seniors but for everyone who loves, supports and depends on seniors. Which is to say, everyone.

But the status quo is unsustainable. Some 10,000 Baby Boomers will be going on Social Security and Medicare every single day between now and 2030. By the time everyone in this big pig-in-the-python generation is drawing benefits, we’ll have just two workers per beneficiary – down from three-to-one now, five-to-one in 1960 and more than forty-to-one in 1945, shortly after Social Security first started supporting beneficiaries.

The math of the 20th century simply won’t work in the 21st. Today's young are paying taxes to support a level of benefits for today's old that they have no realistic chance of receiving when they become old. And they know it – just 6% of Millennials say they expect to receive full benefits from Social Security when they retire. Fully half believe they’ll get nothing.

Read it all.

Filed under: * Culture-WatchAging / the ElderlyYoung Adults* Economics, PoliticsEconomyThe U.S. GovernmentBudgetMedicaidMedicareSocial SecurityThe National DeficitPolitics in GeneralHouse of RepresentativesOffice of the PresidentPresident Barack ObamaSenate* TheologyEthics / Moral Theology

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Posted April 22, 2014 at 11:16 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

The Defense Department on Monday proposed cutting the Army to its smallest size in 74 years, slashing a class of attack jets and rolling back personnel costs in an effort to adjust a department buoyed by a decade of war to an era of leaner budgets.

The five-year budget blueprint outlined by Defense Secretary Chuck Hagel reflects a willingness by the Pentagon to make deep cuts to personnel strength to invest in technology and equipment as it eases off a war footing.

“The development and proliferation of more advanced military technologies by other nations mean that we are entering an era where American dominance on the seas, in the skies and in space can no longer be taken for granted,” Hagel told reporters at an afternoon news conference.

Read it all.

Filed under: * Economics, PoliticsDefense, National Security, MilitaryEconomyThe U.S. GovernmentBudget* TheologyEthics / Moral Theology

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Posted February 25, 2014 at 6:00 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

Treasury Secretary Jacob J. Lew warned Congress on Wednesday that the government would most likely exhaust its ability to borrow in late February, setting up yet another fiscal showdown with Republicans, and this time earlier than congressional leaders had anticipated.

In a letter to Speaker John A. Boehner and the other top three congressional leaders, Mr. Lew said a surge of February spending, mainly tax refunds for 2013, would leave the Treasury with little room to maneuver after the official debt limit is reached on Feb. 7.

The letter amounts to an early alarm bell, coming just weeks after Congress passed its first bipartisan budget and comprehensive spending bill in years. Those bills were supposed to serve as a cease-fire in the budget wars that have rattled the country and the economy since Republicans took control of the House in 2011.

Read it all.

Filed under: * Culture-WatchGlobalizationHistory* Economics, PoliticsEconomyTaxesThe U.S. GovernmentBudgetFederal ReserveMedicaidMedicareSocial SecurityThe National DeficitThe United States Currency (Dollar etc)Politics in GeneralHouse of RepresentativesOffice of the PresidentPresident Barack ObamaSenate* International News & CommentaryAmerica/U.S.A.* TheologyEthics / Moral Theology

6 Comments
Posted January 23, 2014 at 5:15 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

Although the Fed expects to keep reducing the program "in measured steps" next year, the timing and the course isn't preset. "Continued progress [in the economy] is by no means certain," Mr. [Ben] Bernanke said. "The steps that we take will be data-dependent."

If the Fed proceeds at the pace he set out, it would complete the bond-buying program toward the end of 2014 with holdings of nearly $4.5 trillion in bonds, loans and other assets, nearly six times as large as the Fed's total holdings when the financial crisis started in 2008.

Still, officials—worried that investors would quake at the thought of less Fed support—went to lengths to demonstrate that they would keep interest rates low for years to come, even after the bond-buying program ends.
Read it all.

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Posted December 19, 2013 at 8:00 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

But there’s a problem. [Charles] Lindblom’s common-sense insight has a giant exception: crises. Change, forced by outside events, then happens by “leaps and bounds.” The recent financial crisis caused Congress and two presidents to embrace measures (the rescue of big banks, General Motors and Chrysler) that were unthinkable a few months earlier. In the 1960s, civil rights demonstrations pushed Congress to pass the Civil Rights Act of 1964 that, in outlawing most public racial discrimination, wasn’t “incremental.” History offers other examples, including the Civil War, the New Deal and both World Wars. Small changes won’t suffice when big changes are required.

On the budget, muddling through comes with a crucial assumption. It is that continuous deficits won’t provoke a crisis that compels political leaders to take harsh steps that they would otherwise not take. This optimism may be justified. For decades, “experts” have warned of the dire consequences of unchecked deficits. Yet no great crisis has occurred. But this conviction also could be complacency. Government debt is in territory that, except for wartime debt, is unprecedented. We don’t know the consequences. Someday, we may no longer have the luxury of muddling through.

Read it all.

Filed under: * Culture-WatchAging / the ElderlyYoung Adults* Economics, PoliticsEconomyTaxesThe U.S. GovernmentBudgetMedicareSocial SecurityThe National DeficitPolitics in GeneralHouse of RepresentativesOffice of the PresidentPresident Barack ObamaSenate* TheologyEthics / Moral Theology

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Posted December 17, 2013 at 5:00 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

House and Senate negotiators have reached agreement on an $85 billion package to fund the government past Jan. 15, avoid another federal shutdown and end the cycle of budget crises that have dominated Washington for much of the past three years.

The deal did not include a key priority of House Democrats who wanted an extension of long-term benefits for the unemployed. But Democrats said they would continue to press Republicans on the issue in hopes of preventing more than 1 million people from losing their unemployment checks at the end of the month.

Read it all.

Filed under: * Economics, PoliticsEconomyThe U.S. GovernmentBudgetThe National DeficitPolitics in GeneralHouse of RepresentativesSenate

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Posted December 10, 2013 at 6:45 pm [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

No one wants to be against Grandma, who — as portrayed in the media — is kindly, often suffering from some condition, usually financially precarious and somehow needy. But projecting this sympathetic portrait onto the entire 65-plus population is an exercise in make-believe and, frequently, political propaganda. The St. Louis Fed study refutes the stereotype. Examining different age groups, it found that since the financial crisis, incomes have risen for the elderly while they’ve dropped for the young and middle-aged.

The numbers are instructive. From 2007, the year before the financial crisis, to 2010, median income for the families under 40 dropped 12.4 percent to $39,644. For the middle-aged from 40 to 61, the comparable decline was 11.9 percent to $56,924. Meanwhile, those aged 62 to 69 gained 12.3 percent to $50,825. For Americans 70-plus, the increase was 15.6 percent to $31,512. (All figures adjust for inflation and are in 2010 “constant” dollars. The “median income” is the midpoint of incomes and is often considered “typical.”)

There has been a historic shift in favor of today’s elderly. To put this in perspective, recall that many family expenses drop with age. Mortgages are paid off; work costs vanish; children leave. Recall also that incomes typically follow a “life cycle”: They start low in workers’ 20s, peak in their 50s, and then decline in retirement, as wages give way to government transfers and savings. Against these realities, the long-term gains of the elderly and losses of the young are astonishing. From 1989 to 2010, median income increased 60 percent for those aged 62 to 69 while falling 6 percent for those under 40 and 2 percent for those 40 to 61.

Read it all.

Filed under: * Culture-WatchAging / the ElderlyHealth & Medicine* Economics, PoliticsEconomyThe U.S. GovernmentBudgetMedicareSocial SecurityThe National DeficitPolitics in General

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Posted November 4, 2013 at 3:00 pm [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

The bishops might have been promoting a strictly Democratic line, but U.S. Senate Chaplain Barry Black was more ecumenical. Amid the shutdown, Rev. Black offered a daily prayer in the Senate chamber asking God to “save us from the madness. We acknowledge our transgressions, our shortcomings, our smugness, our selfishness, and our pride.” Later he condemned the “hypocrisy of attempting to sound reasonable while being unreasonable.” His listeners in one party no doubt assumed he was talking about the other side.

It is one thing to spiritually shame politicians, as Rev. Black did. Trying to do their jobs is another. The bishops and other clergy in the Circle of Protection go well beyond their competencies when they make such policy prescriptions. Speaking about the moral issues of the day is certainly within their pastoral purview, but the bishops’ calls to raise revenues (aka taxes), for instance, or eliminate “unnecessary” military spending are not.

Bishops routinely assert their authority as “pastors and teachers,” as Bishops Blaire, Gomez and Pates did, but according to the tradition of their own church, they have no teaching authority when it comes to politics.

Read it all.

Filed under: * Culture-WatchReligion & Culture* Economics, PoliticsEconomyConsumer/consumer spendingCorporations/Corporate LifeCredit MarketsCurrency MarketsHousing/Real Estate MarketLabor/Labor Unions/Labor MarketTaxesThe Banking System/SectorThe Credit Freeze Crisis of Fall 2008/The Recession of 2007--The U.S. GovernmentBudgetMedicaidMedicareSocial SecurityThe National DeficitPolitics in GeneralHouse of RepresentativesOffice of the PresidentPresident Barack ObamaSenate* International News & CommentaryAmerica/U.S.A.* TheologyEthics / Moral Theology

3 Comments
Posted October 25, 2013 at 11:11 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

2--At its root Social Security is, and always has been, an inter-generational transfer of wealth....

4--...since 2010 Social Security’s cash expenses have exceeded its cash receipts; negative cash flow last year was about $55 billion, according to the latest report from the system’s trustees. While credited interest is still more than enough to cover the deficit, that will only be true until 2020. After that, Social Security will begin redeeming its hoard of Treasuries for cash to continue paying benefits — as was the plan all along.

Read it all.

Filed under: * Culture-WatchHistory* Economics, PoliticsEconomyLabor/Labor Unions/Labor MarketThe U.S. GovernmentBudgetSocial SecurityThe National DeficitPolitics in GeneralHouse of RepresentativesOffice of the PresidentPresident Barack ObamaSenate* TheologyEthics / Moral Theology

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Posted October 20, 2013 at 6:45 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

Stan Druckenmiller makes an unlikely class warrior. He's a member of the 1%—make that the 0.001%—one of the most successful money managers of all time, and 60 years old to boot. But lately he has been touring college campuses promoting a message of income redistribution you don't hear out of Washington. It's how federal entitlements like Medicare and Social Security are letting Mr. Druckenmiller's generation rip off all those doting Barack Obama voters in Generation X, Y and Z.

"I have been shocked at the reception. I had planned to only visit Bowdoin, " his alma mater in Maine, he says. But he has since been invited to multiple campuses, and even the kids at Stanford and Berkeley have welcomed his theme of generational theft. Harlem Children's Zone President Geoffrey Canada and former Federal Reserve Governor Kevin Warsh have joined him at stops along the tour.

Mr. Druckenmiller describes the reaction of students: "The biggest question I got was, 'How do we start a movement?' And my answer was 'I'm a 60-year-old washed-up money manager. I don't know how to start a movement. That's your job. But we did it in Vietnam without Twitter and without Facebook and without any social media. That's your job.' But the enthusiasm—they get it."

Read it all.

Filed under: * Culture-WatchAging / the ElderlyMiddle AgeYoung Adults* Economics, PoliticsEconomyThe U.S. GovernmentBudgetMedicareSocial SecurityThe National DeficitPolitics in GeneralHouse of RepresentativesOffice of the PresidentPresident Barack ObamaSenate* TheologyEthics / Moral Theology

1 Comments
Posted October 19, 2013 at 10:00 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

Read it all.

Filed under: * Economics, PoliticsEconomyThe U.S. GovernmentBudgetThe National Deficit* TheologyEthics / Moral Theology

6 Comments
Posted October 18, 2013 at 5:09 pm [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

Standard & Poor’s is only raising half a cheer at the deal:

“We believe that to date, the shutdown has shaved at least 0.6 per cent off of annualised fourth-quarter 2013 GDP growth, or taken $24bn out of the economy.

“The short turnround for politicians to negotiate some sort of lasting deal will probably weigh on consumer confidence, especially among government workers that were furloughed. If people are afraid that the government policy brinkmanship will resurface again, and with it the risk of another shutdown or worse, they’ll remain afraid to open up their cheque books. That points to another Humbug holiday season.”

Read it all (if necessary another link is there).

Filed under: * Culture-WatchAging / the ElderlyHealth & Medicine* Economics, PoliticsEconomyTaxesThe U.S. GovernmentBudgetMedicaidMedicareSocial SecurityThe National DeficitThe United States Currency (Dollar etc)Politics in GeneralHouse of RepresentativesOffice of the PresidentPresident Barack ObamaSenate

1 Comments
Posted October 17, 2013 at 5:45 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

Is the US dollar's position as the reserve currency of the world imperiled as a result of the debt limit showdown in Washington?

Read it all.


Filed under: * Culture-WatchGlobalization* Economics, PoliticsEconomyConsumer/consumer spendingCorporations/Corporate LifeCurrency MarketsThe U.S. GovernmentBudgetThe National DeficitForeign RelationsPolitics in GeneralHouse of RepresentativesOffice of the PresidentSenate* TheologyEthics / Moral Theology

0 Comments
Posted October 17, 2013 at 5:30 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

“We took some bread crumbs and left an entire meal on the table,” said Senator Lindsey Graham, Republican of South Carolina. “This has been a really bad two weeks for the Republican Party”--From the online version of last night's New York Times
I will take comments on this submitted by email only to KSHarmon[at]mindspring[dot]com.

Filed under: * Culture-WatchHealth & Medicine--The 2009 American Health Care Reform Debate* Economics, PoliticsEconomyThe U.S. GovernmentBudgetThe National DeficitPolitics in GeneralHouse of RepresentativesOffice of the PresidentPresident Barack ObamaSenate* South Carolina* TheologyEthics / Moral Theology


Posted October 17, 2013 at 5:15 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

With just two days to go before an Oct. 17 deadline to raise the nation’s debt limit, 51% of the public views a rise in the nation’s debt limit as “absolutely essential” in order to avoid an Half View Debt Limit Increase as Essential, More than a Third Say it is Noteconomic crisis, while 36% think the country can go past the deadline without major problems.

Public concern over breaching the debt limit deadline has risen only slightly from a week ago, when 47% said a rise in the debt limit was essential and 39% said it was not.

Those who see no dire economic consequences resulting from going past Thursday’s deadline are not only skeptical about the timing – most say there is no need to raise the debt limit at all. Nearly a quarter of all Americans (23%) – including 37% of Republicans and 52% of Tea Party Republicans – believe the debt limit does not need to be raised at all.

Read it all.

Filed under: * Culture-WatchGlobalization* Economics, PoliticsEconomyConsumer/consumer spendingCorporations/Corporate LifeCredit MarketsCurrency MarketsHousing/Real Estate MarketLabor/Labor Unions/Labor MarketPersonal FinanceStock MarketThe U.S. GovernmentBudgetThe National DeficitPolitics in GeneralHouse of RepresentativesOffice of the PresidentSenate* International News & CommentaryAmerica/U.S.A.* TheologyEthics / Moral Theology

0 Comments
Posted October 16, 2013 at 6:28 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

Looks like it will go through Jan 15, and there will be a panel create to work on deficit reduction.

One of many tweets:

‏@j_strong
“It’s all over. We’ll take Senate deal" ... “People are thinking about primaries, they really are"


Filed under: * Economics, PoliticsEconomyThe U.S. GovernmentBudgetThe National DeficitPolitics in GeneralHouse of RepresentativesOffice of the PresidentPresident Barack ObamaSenate

8 Comments
Posted October 15, 2013 at 7:01 pm [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

Top Senate leaders on Monday said they were within striking distance of a deal to sidestep a looming debt crisis and reopen the federal government two weeks after a partisan deadlock forced it to close.

Fourteen days after a partial government shutdown began, senators signaled a bipartisan resolution could come soon.

"I'm very optimistic we will reach an agreement that's reasonable in nature this week to reopen the government, pay the nation's bills and begin long-term negotiations to put our country on sound fiscal footing," Senate Majority Leader Harry Reid (D., Nev.) said on the Senate floor.

Read it all.

Filed under: * Culture-WatchGlobalization* Economics, PoliticsEconomyConsumer/consumer spendingCorporations/Corporate LifeCredit MarketsCurrency MarketsThe Banking System/SectorThe U.S. GovernmentBudgetMedicaidMedicareSocial SecurityThe National DeficitPolitics in GeneralHouse of RepresentativesOffice of the PresidentPresident Barack ObamaSenate* TheologyEthics / Moral Theology

1 Comments
Posted October 14, 2013 at 5:16 pm [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

...it is still foolish to ignore the leverage that the individual mandate gives opponents of Obamacare. America's healthcare system for the elderly (Medicare, plus Medicaid for nursing-home care) is already edging the country toward generational war because Washington will sooner or later be forced to choose between drastic limitations on coverage in those programs or drastic increases in taxes on the decreasing portion of working Americans. Now we're adding a parallel obligation on younger workers to subsidize healthcare for fiftysomethings.

What to do? The path of least political resistance is to tough it out, hoping younger households will be unable to figure out what's happening, or simply unwilling to throw in their lot with opponents of gay marriage, marijuana reform and the like. Alternatively, we could start paying attention to the building crisis as younger households scramble ever harder for a middle-class living standard.

And none too soon, because the signs of generational conflict are already appearing.

Read it all.

Filed under: * Culture-WatchAging / the ElderlyHealth & Medicine--The 2009 American Health Care Reform DebateYoung Adults* Economics, PoliticsEconomyConsumer/consumer spendingCorporations/Corporate LifeHousing/Real Estate MarketLabor/Labor Unions/Labor MarketTaxesThe U.S. GovernmentBudgetMedicaidMedicareThe National DeficitPolitics in General* International News & CommentaryAmerica/U.S.A.* TheologyEthics / Moral Theology

0 Comments
Posted October 14, 2013 at 8:00 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

What started as a mad dash to strike a deal to lift the federal debt limit slowed to a crawl over the weekend as stalemated Senate leaders waited nervously to see whether financial markets would plunge Monday morning and drive the other side toward compromise.

Republicans seemed to think they had more to lose. After talks broke down between President Obama and House leaders, GOP senators quickly cobbled together a plan to end the government shutdown — now entering its third week — and raise the $16.7 trillion debt limit. Senate Minority Leader Mitch McConnell (R-Ky.) then asked Majority Leader Harry M. Reid (D-Nev.) to elevate negotiations to the highest level.

On Sunday — with the Treasury Department due to exhaust its borrowing power in just four days — Reid was wielding that leverage to maximum advantage. Rather than making concessions that would undermine Obama’s signature health-care initiative, as Republicans first demanded, Democrats are now on the offensive and seeking to undo what has become a cherished prize for the GOP: deep agency spending cuts known as the sequester.

Read it all.

Filed under: * Culture-WatchGlobalization* Economics, PoliticsEconomyConsumer/consumer spendingCorporations/Corporate LifeCredit MarketsCurrency MarketsStock MarketThe Banking System/SectorThe U.S. GovernmentBudgetFederal ReserveThe National DeficitPolitics in GeneralHouse of RepresentativesOffice of the PresidentPresident Barack ObamaSenate

4 Comments
Posted October 14, 2013 at 5:45 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

Asthma — the most common chronic disease that affects Americans of all ages, about 40 million people — can usually be well controlled with drugs. But being able to afford prescription medications in the United States often requires top-notch insurance or plenty of disposable income, and time to hunt for deals and bargains.

The arsenal of medicines in the Hayeses’ kitchen helps explain why. Pulmicort, a steroid inhaler, generally retails for over $175 in the United States, while pharmacists in Britain buy the identical product for about $20 and dispense it free of charge to asthma patients. Albuterol, one of the oldest asthma medicines, typically costs $50 to $100 per inhaler in the United States, but it was less than $15 a decade ago, before it was repatented.

“The one that really blew my mind was the nasal spray,” said Robin Levi, Hannah and Abby’s mother, referring to her $80 co-payment for Rhinocort Aqua, a prescription drug that was selling for more than $250 a month in Oakland pharmacies last year but costs under $7 in Europe, where it is available over the counter.

Read it all.

Filed under: * Culture-WatchHealth & Medicine--The 2009 American Health Care Reform Debate* Economics, PoliticsEconomyConsumer/consumer spendingCorporations/Corporate LifeThe U.S. GovernmentBudgetMedicaidMedicareThe National Deficit* TheologyAnthropologyEthics / Moral Theology

1 Comments
Posted October 13, 2013 at 2:00 pm [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

The Senate's top two leaders have asserted control over budget negotiations with the White House for a deal to reopen the federal government and avoid a default on the nation's debt.

Senate Majority Leader Harry Reid, D-Nev., and Senate Minority Leader Mitch McConnell, R-Ky., met Saturday morning with Sen. Lamar Alexander, R-Tenn., and Sen. Charles Schumer, D-N.Y., to begin preliminary discussions.

"I hope that our talking is some solace to the American people and to the world," Reid said. "This should be seen as something very positive, even though we don't have anything done yet."

Read it all.

Filed under: * Economics, PoliticsEconomyThe U.S. GovernmentBudgetThe National DeficitPolitics in GeneralHouse of RepresentativesOffice of the PresidentPresident Barack ObamaSenate* TheologyEthics / Moral Theology

3 Comments
Posted October 12, 2013 at 2:05 pm [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

....the Federal Disability Insurance Program...serves nearly 12 million people -- up 20 percent in the last six years -- and has a budget of $135 billion. That's more than the government spent last year on the Department of Homeland Security, the Justice Department, and the Labor Department combined. It's been called a "secret welfare system" with it's own "disability industrial complex," a system ravaged by waste and fraud. A lot of people want to know what's going on. Especially Sen. Tom Coburn of Oklahoma.

Tom Coburn: Go read the statute. If there's any job in the economy you can perform, you are not eligible for disability. That's pretty clear. So, where'd all those disabled people come from?

The Social Security Administration, which runs the disability program says the explosive surge is due to aging baby boomers and the lingering effects of a bad economy. But Sen. Tom Coburn of Oklahoma, the ranking Republican on the Senate Subcommittee for Investigations -- who's also a physician -- says it's more complicated than that. Last year, his staff randomly selected hundreds of disability files and found that 25 percent of them should never have been approved -- another 20 percent, he said, were highly questionable.

Read it all or better still watch the video.

Filed under: * Culture-WatchAging / the ElderlyHealth & MedicineLaw & Legal IssuesMiddle AgePsychology* Economics, PoliticsEconomyLabor/Labor Unions/Labor MarketPersonal FinanceThe Credit Freeze Crisis of Fall 2008/The Recession of 2007--The U.S. GovernmentBudgetMedicareSocial SecurityThe National Deficit* TheologyAnthropologyEthics / Moral Theology

5 Comments
Posted October 10, 2013 at 5:45 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

A proposal from Sen. Susan Collins is emerging as one potential way to dig lawmakers out of a government shutdown and possibly also avoid a potentially catastrophic debt default.

The moderate Maine Republican, whose vote will be essential to any fiscal deal, is circulating a rough plan to reopen the government, repeal the medical device tax and provide agencies with greater flexibility in implementing the sequester. The initial reception has been positive and may be the beginnings of a bipartisan solution to end the intractable impasse between House Republicans and Senate Democrats.

Collins said Sens. Kelly Ayotte (R-N.H.) and Lisa Murkowski (R-Alaska), who are also being watched as potential GOP votes to end the fiscal standoff, have signed onto the proposal. And Collins said she has spoken to “several Democrats” about her plan, which she hopes “at least provides concepts that could be the basis for us reopening government.”

Read it all.

Filed under: * Culture-WatchHealth & Medicine* Economics, PoliticsEconomyCorporations/Corporate LifeTaxesThe U.S. GovernmentBudgetThe National DeficitPolitics in GeneralHouse of RepresentativesOffice of the PresidentPresident Barack ObamaSenate* TheologyEthics / Moral Theology

0 Comments
Posted October 9, 2013 at 6:12 pm [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

As the government shutdown enters its second week, some religious groups are starting to feel the pinch, and they’re also finding ways to reach out.

More than 90 Catholic, evangelical and Protestant leaders have signed a statement rebuking “pro-life” lawmakers for the shutdown, saying they are “appalled that elected officials are pursuing an extreme ideological agenda at the expense of the working poor and vulnerable families” who won’t receive government benefits.

Starting Wednesday, evangelical, Catholic and mainline Protestant leaders will hold a daily “Faithful Filibuster” on Capitol Hill with Bible verses on the poor “to remind Congress that its dysfunction hurts struggling families and low-income people.”

Read it all.


Filed under: * Culture-WatchReligion & Culture* Economics, PoliticsEconomyThe U.S. GovernmentBudgetThe National DeficitPolitics in GeneralHouse of RepresentativesOffice of the PresidentPresident Barack ObamaSenate* TheologyEthics / Moral Theology

0 Comments
Posted October 9, 2013 at 3:44 pm [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

A senior Chinese official has warned that the "clock is ticking" to avoid a US default that could hurt China's interests and the global economy.

China, the US's largest creditor, is "naturally concerned about developments in the US fiscal cliff", vice finance minister Zhu Guangyao said.

Washington must agree a deal to raise its borrowing limit by 17 October, or risk being unable to pay its bills.

Read it all.

Filed under: * Culture-WatchGlobalization* Economics, PoliticsEconomyConsumer/consumer spendingCorporations/Corporate LifeCredit MarketsCurrency MarketsEuroEuropean Central BankG20 Stock MarketThe U.S. GovernmentBudgetThe National DeficitForeign RelationsPolitics in GeneralHouse of RepresentativesOffice of the PresidentPresident Barack ObamaSenate* International News & CommentaryAsiaChina

2 Comments
Posted October 7, 2013 at 4:50 pm [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

The work that Shaun O'Connell does is required by law, yet now he's sidelined by the government shutdown.

O'Connell reviews disability claims for the Social Security Administration in New York, checking that no one's gaming the system, while ensuring people with legitimate medical problems are compensated properly.

Billions of dollars are at stake with this kind of work, yet O'Connell is considered a nonessential employee for purposes of the partial government shutdown.

"If you stick with the semantics of essential and nonessential, you could easily be offended," says O'Connell, who has worked for Social Security for 20 years.

Read or listen to it all.


Filed under: * Economics, PoliticsEconomyLabor/Labor Unions/Labor MarketThe U.S. GovernmentBudgetThe National DeficitPolitics in GeneralHouse of RepresentativesOffice of the PresidentPresident Barack ObamaSenate* TheologyAnthropologyEthics / Moral Theology

7 Comments
Posted October 6, 2013 at 6:48 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

The Episcopal bishop of Washington is inviting any couples who had to cancel their weddings on federal property due to the government shutdown to have their ceremonies in a garden at Washington National Cathedral.

Bishop Mariann Edgar Budde said Thursday that the Bishop’s Garden at the cathedral would be offered free of charge to any couples who wanted to hold wedding ceremonies outdoors.

Read it all.

Filed under: * Anglican - EpiscopalEpiscopal Church (TEC)TEC Bishops* Culture-WatchMarriage & FamilyReligion & Culture* Economics, PoliticsEconomyThe U.S. GovernmentBudgetThe National DeficitPolitics in GeneralHouse of RepresentativesOffice of the PresidentPresident Barack ObamaSenate* TheologyEthics / Moral TheologyPastoral Theology

0 Comments
Posted October 4, 2013 at 3:00 pm [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

On the eve of a possible shutdown of the U.S. government, religious leaders denounced the political brinkmanship prevailing in Congress today.

"Shutting down the government will do real damage," said Rev. David Beckmann, president of Bread for the World, speaking at a press conference today. "Risking our nation's creditworthiness will do even more damage. Most clearly, the disruption and uncertainty will put the brakes on our economy."

Unless our nation's leaders come to an agreement on appropriations for the coming months, the U.S. government will close on Oct. 1, the start of the 2014 fiscal year. If no agreement is reached by Oct. 17 on increasing the debt limit, the country's creditworthiness will be compromised.

Read it all and follow the link at the bottom to the letter to see the actual signatories.


Filed under: * Anglican - EpiscopalEpiscopal Church (TEC)Presiding Bishop Katharine Jefferts Schori* Culture-WatchReligion & Culture* Economics, PoliticsEconomyThe U.S. GovernmentBudgetThe National DeficitPolitics in GeneralHouse of RepresentativesOffice of the PresidentPresident Barack ObamaSenate* Religion News & CommentaryOther Churches* TheologyEthics / Moral Theology

2 Comments
Posted October 4, 2013 at 8:00 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

Biologist Louis Burnett had to move his lab students to a conference room across the parking lot at Fort Johnson. His federal lab, animals and cell cultures are under lock and key.

Burnett’s dilemma is a case example of the ripple effect of the ongoing federal shutdown. As the shutdown enters its third day, the clock keeps ticking insistently for any number of people who don’t work for the federal government but find themselves on the outs because of the political standoff.

Burnett is a research professor at the College of Charleston. But like others in a cadre of college and state researchers, he collaborates on studies, shares office space and makes use of the equipment at the Hollings Marine Lab and the Center for Coastal Environmental Health and Biomolecular Research.

Read it all.


Filed under: * Culture-WatchEducationScience & Technology* Economics, PoliticsEconomyConsumer/consumer spendingLabor/Labor Unions/Labor MarketThe U.S. GovernmentBudgetThe National DeficitPolitics in GeneralHouse of RepresentativesOffice of the PresidentPresident Barack ObamaSenate* South Carolina

0 Comments
Posted October 3, 2013 at 6:45 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

The good news is that so far, all we have is political posturing. History suggest that nothing happens until at least 12 hours after our September 30th midnight deadline. No one gets serious about any sort of deal before noon on October 1. At that point, political pressure on the House Republicans — from constituents, from Business leaders, and from elder statesmen — will start in earnest. A few days later, it can become more intense. We see the same sort of patterns with the debt ceiling limit as well (that’s schedule to hit at midnight October 17).

As NBC’s Pete Williams have reported, we have had 17 prior government shutdowns over the past 40 years, including 21 days in 1995 (table below). So while this feels like its new and unusual, it is actually more commonplace than most of us believe.

Read it all.

Filed under: * Culture-WatchHistory* Economics, PoliticsEconomyConsumer/consumer spendingCorporations/Corporate LifeThe U.S. GovernmentBudgetPolitics in GeneralHouse of RepresentativesOffice of the PresidentPresident Barack ObamaSenate* TheologyEthics / Moral Theology

16 Comments
Posted September 30, 2013 at 6:59 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

The federal government moved closer to a partial shutdown Sunday as Republican and Democratic lawmakers showed no signs of negotiating through a standoff over the implementation of President Barack Obama's health law.

The standoff left little prospect that Congress could reach agreement on terms for funding the government by midnight Monday, when the current fiscal year expires. A shutdown would leave essential services operating but prompt federal agencies to suspend many functions and furlough hundreds of thousands of workers.

Early Sunday morning, after a late night of votes, the House passed a bill delaying the health law by one year and attached it to a plan to fund the government through Dec. 15. It also includes a provision repealing a tax on medical devices that is intended to help finance the health law. That legislation now goes back to the Senate.

Read it all.

Filed under: * Economics, PoliticsEconomyThe U.S. GovernmentBudgetMedicaidMedicareSocial SecurityThe National DeficitPolitics in GeneralHouse of RepresentativesOffice of the PresidentPresident Barack ObamaSenate* TheologyEthics / Moral Theology

0 Comments
Posted September 29, 2013 at 6:50 pm [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

The federal government on Sunday morning barreled toward its first shutdown in 17 years after the Republican-run House, choosing a hard line, voted to attach a one-year delay of President Obama’s health care law and a repeal of a tax to pay for it to legislation to keep the government running.

The votes, just past midnight, followed an often-angry debate, with members shouting one another down on the House floor. Democrats insisted that Republicans refused to accept their losses in 2012, were putting contempt for the president over the good of the country and would bear responsibility for a shutdown. Republicans said they had the public on their side and were acting to protect Americans from a harmful and unpopular law that had already proved a failure.

Read it all.

Filed under: * Culture-WatchHealth & Medicine--The 2009 American Health Care Reform Debate* Economics, PoliticsEconomyConsumer/consumer spendingCorporations/Corporate LifeHousing/Real Estate MarketLabor/Labor Unions/Labor MarketPersonal FinanceThe U.S. GovernmentBudgetMedicaidMedicareSocial SecurityThe National DeficitPolitics in GeneralHouse of RepresentativesSenate* TheologyEthics / Moral Theology

3 Comments
Posted September 29, 2013 at 6:05 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

Between 2000 and 2012, the number of people in Penobscot County [Maine] receiving Social Security disability benefits skyrocketed, rising from 4,475 to 7,955 — or nearly one in 12 of the county’s adults between the ages of 18 and 64, according to Social Security statistics.

The fast expansion of disability here is part of a national trend that has seen the number of former workers receiving benefits soar from just over 5 million to 8.8 million between 2000 and 2012. An additional 2.1 million dependent children and spouses also receive benefits.

The crush of new recipients is putting unsustainable financial pressure on the program. Federal officials project that the program will exhaust its trust fund by 2016 — 20 years before the trust fund that supports Social Security’s old-age benefits is projected to run dry.

Read it all.

Filed under: * Culture-WatchHealth & MedicineMiddle AgePsychology* Economics, PoliticsEconomyLabor/Labor Unions/Labor MarketThe Credit Freeze Crisis of Fall 2008/The Recession of 2007--The U.S. GovernmentBudgetMedicareSocial SecurityThe National Deficit

0 Comments
Posted September 21, 2013 at 9:01 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

There's plenty of fodder for deficit hawks in a new report from the nonpartisan Congressional Budget Office. In short, the future looks grim....

First, the good news: The CBO projects the deficit will shrink to $378 billion in 2015, or 2.1 percent of the size of the overall U.S. economy. Compared with just a few years ago when the budget gap ballooned as a result of the recession, this marks a nearly unprecedented improvement in the deficit picture. It's a rapid decline in budget shortfalls not seen since the end of World War II. The national debt will bottom out in 2018, at 68 percent of GDP.

The bad news: From there, the picture gets decidedly less rosy. Budget deficits gradually rise, "mainly because of increasing interest costs and growing spending for Social Security and the government's major health care programs (Medicare, Medicaid, the Children's Health Insurance Program, and subsidies to be provided through the health insurance exchanges)," says the report. By 2038, the national debt will reach 100 percent of GDP....

Read it all and follow the link to the actual report.


Filed under: * Culture-WatchAging / the ElderlyMiddle AgeYoung Adults* Economics, PoliticsEconomyTaxesThe U.S. GovernmentBudgetMedicaidMedicareSocial SecurityThe National DeficitPolitics in GeneralHouse of RepresentativesOffice of the PresidentSenate* TheologyEthics / Moral Theology

1 Comments
Posted September 18, 2013 at 3:00 pm [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

Under the Affordable Care Act, more insurance plans are expected to start covering the cost of obesity treatments, including counseling on diet and exercise as well as medications and surgery. These are treatments that most insurance companies don't cover now.

This move is a response to the increasing number of health advocates and medical groups that say obesity should be classified as a disease.

Not everyone thinks this is a good idea. But this summer, the American Medical Association determined that . They followed in the footsteps of the , a health advocacy group that called obesity a disease back in 2008.

Read or listen to it all.

Filed under: * Culture-WatchHealth & Medicine--The 2009 American Health Care Reform DebateScience & Technology* Economics, PoliticsEconomyConsumer/consumer spendingCorporations/Corporate LifeLabor/Labor Unions/Labor MarketThe U.S. GovernmentBudgetThe National DeficitPolitics in General* TheologyAnthropologyEthics / Moral Theology

2 Comments
Posted September 16, 2013 at 5:45 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

The Senate resolution would limit hostilities to 60 or 90 days, narrow the conflict to Syria's borders and prohibit U.S. troops on Syrian soil. McCain's amendments didn't change that scope, but made clear that the end goal should be "a negotiated settlement that ends the conflict and leads to a democratic government in Syria."

The vote was 10-7. Five Republicans and two Democrats voted against it.

Read it all.

Filed under: * Economics, PoliticsDefense, National Security, MilitaryEconomyThe U.S. GovernmentBudgetForeign RelationsPolitics in GeneralOffice of the PresidentPresident Barack ObamaSenate* International News & CommentaryMiddle EastSyria* TheologyEthics / Moral Theology

0 Comments
Posted September 4, 2013 at 3:45 pm [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

“Unfortunately, we seem to be entering another of those periods of elevated risk,” economists at Bank of America Merrill Lynch wrote last week. Researchers at RBC Capital Markets sounded even more bleak. “Just when you thought the U.S. economy was ready to break out of its lackluster 2 percent growth pace that has dominated the recovery,” they wrote, “reality hits.”

More economic turbulence would be particularly tough for poor and middle-class American workers, who are still struggling amid the historically weak growth following the recession. The typical worker’s income has fallen since the recession ended more than four years ago, and the economy, still far from full employment, is creating far more low-paying jobs than good-paying ones. Polls show that workers remain discouraged by the economic picture, with more than half believing the United States is still in recession.

Read it all.

Filed under: * Economics, PoliticsEconomyCorporations/Corporate LifeLabor/Labor Unions/Labor MarketPersonal FinanceTaxesThe Credit Freeze Crisis of Fall 2008/The Recession of 2007--The U.S. GovernmentBudgetThe National DeficitPolitics in GeneralHouse of RepresentativesOffice of the PresidentPresident Barack ObamaSenate* TheologyAnthropologyEthics / Moral Theology

0 Comments
Posted September 3, 2013 at 4:48 pm [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

[General Ray] Odierno called the moves “one of the largest organizational changes probably since World War II” for the service.

“If we go though full sequestration there’s going to be another reduction in brigades, there’s no way around it,” Odierno warned, adding that there will likely be more cuts coming in the heavy armor brigades, sequestration or not.

Fewer brigades, fewer soldiers, less money, and an uncertain modernization profile. With all of this in flux, what missions will the Army prioritize in the future?

Read it all.

Filed under: * Culture-WatchScience & Technology* Economics, PoliticsDefense, National Security, MilitaryEconomyThe U.S. GovernmentBudgetPolitics in General

0 Comments
Posted August 2, 2013 at 6:30 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

One of America’s chief fiscal burdens is the mounting cost of entitlements (Social Security, Medicare, and Medicaid) – an obligation that will only grow larger as baby boomers age. In tackling this problem, the United States should look to what many might see as an unlikely model – the European welfare state, Sweden.

“Usually, U.S. policymakers look to Europe to determine what not to do when it comes to social-welfare policy,” James C. Capretta, former associate director of the US Office of Management and Budget, wrote a few years ago.

But, he continued: “When you are in a hole, the prudent first step is to stop digging, and the United States can indeed gain insight into how to ‘stop digging’ the entitlement hole” by studying the reforms that some European countries have implemented. Most notably, he suggested, we should study what Sweden and Germany did to cut their long-term government pension commitments.

Read it all.


Filed under: * Culture-WatchAging / the ElderlyHealth & Medicine* Economics, PoliticsEconomyThe U.S. GovernmentBudgetMedicaidMedicareSocial SecurityThe National DeficitPolitics in General* International News & CommentaryEuropeSweden* TheologyEthics / Moral Theology

0 Comments
Posted July 25, 2013 at 3:31 pm [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

The fact that economics tell us to discount -- as in make less of -- each dollar owed or received in the distant future, however, doesn't mean a government can ignore those obligations and receipts, especially if there are loads of future obligations relative to receipts.

Take the just-released 2013 Trustees Report on Social Security's long-run finances. Table IVB6 shows an infinite horizon fiscal gap of $23.1 trillion separating the Social Security system's projected costs and taxes after taking into account the several trillion in the Social Security trust fund. To give you a sense of how massive this shortfall is -- and it grew by fully 8 percent last year alone -- it is 50 percent larger than U.S. GDP and almost twice the size of total federal debt held by the public.

Table IVB6 also reports Social Security's fiscal gap over the next 75 years. It's much smaller -- only $9.6 trillion, and that's the number people tend to use in discussion. But that number is only 41 percent of the actual economic gap: $23.1 trillion. Thus, the 75-year fiscal gap hides three fifths of the system's true long-term shortfall.

Read it all.

Filed under: * Culture-WatchAging / the ElderlyHistory* Economics, PoliticsEconomyThe U.S. GovernmentBudgetSocial SecurityThe National DeficitPolitics in General* TheologyEthics / Moral Theology

0 Comments
Posted June 20, 2013 at 6:00 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

Amid speculation that the Federal Reserve soon might start scaling back its stimulus efforts, the International Monetary Fund cautioned that a pullback before next year could hurt economies worldwide.

Highlighting its concern Friday, the IMF lowered its forecast for U.S. economic growth next year to 2.7% from an earlier projection of 3%.

The IMF also criticized U.S. fiscal policy, calling for the repeal of the automatic federal spending cuts, known as the sequester, and urging lawmakers to act promptly to raise the nation's debt limit.

Read it all.

Filed under: * Economics, PoliticsEconomyConsumer/consumer spendingLabor/Labor Unions/Labor MarketTaxesThe Credit Freeze Crisis of Fall 2008/The Recession of 2007--The Fiscal Stimulus Package of 2009The U.S. GovernmentBudgetPolitics in GeneralHouse of RepresentativesOffice of the PresidentPresident Barack ObamaSenate

0 Comments
Posted June 15, 2013 at 8:30 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

The purpose of Social Security is to help families. It reinforces the intergenerational sharing that families already — though imperfectly — provide. It helps retirees by stabilizing their income, and it helps their grown children, who are relieved of any excessive burden of supporting them. This purpose strongly suggests that the Social Security benefits should be indexed to some measure of the available, aggregate economic pie. That means a formula that looks completely different from the ones being discussed today.

Clearly, something needs to be done: if nothing changes, and the trust fund runs out in 2033, the system would be able to pay only about 75 percent of promised benefits.

The issues are complex, as economic theorists like Henning Bohn at the University of California, Santa Barbara, have shown. But now that an index change is on the table, we should take this opportunity to get it right.

Read it all.

Filed under: * Culture-WatchAging / the ElderlyHistory* Economics, PoliticsEconomyThe U.S. GovernmentBudgetSocial SecurityThe National DeficitPolitics in General

0 Comments
Posted June 10, 2013 at 5:30 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

Shifting government finances are likely to take an even bigger bite out of growth over the next few years than many now expect, economists at the San Francisco Fed warned Monday.

In a research note, Brian Lucking and Daniel Wilson write fiscal policy headwinds will subtract one percentage point from growth over the next three years beyond the normal fiscal drag that usually comes during times of recovery. If not for the current and likely future stance of fiscal policy, the economy would be growing at a faster rate, which would allow for more robust job growth and, presumably, a more normal stance of monetary policy for the Federal Reserve.

Read it all.

Filed under: * Culture-WatchHistory* Economics, PoliticsEconomyConsumer/consumer spendingCorporations/Corporate LifeThe Credit Freeze Crisis of Fall 2008/The Recession of 2007--The U.S. GovernmentBudgetFederal ReservePolitics in General

0 Comments
Posted June 3, 2013 at 12:50 pm [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

Can we get real? For starters, $642 billion is serious money, and despite the modest improvements of the latest CBO report, the basic trends in federal finances remain the same. From 2014 to 2023, the government will spend $6 trillion more than it collects in taxes. The budget never comes close to balancing. Expanding spending on the elderly and health care continues to strangle the rest of government. As a share of the economy (gross domestic product), military and domestic discretionary programs (examples: drug approval, environmental regulation, Head Start, federal courts) drop about 40 percent from 2010 to 2023.

Nothing of consequence has changed. A few numbers have shifted slightly. That’s all. They moved in a favorable direction. Next time, they might go the other way. What’s also constant is the unwillingness of leaders of both parties, beginning with the president, to discuss budget choices candidly. The budget passed by the Democratic Senate barely touches entitlements for the elderly, which constitute the largest chunk of federal spending. The budget passed by the Republican House avoids a large tax increase only by making draconian and unrealistic spending cuts that would never pass Congress or be signed by the president.

Read it all.

Filed under: * Economics, PoliticsEconomyTaxesThe U.S. GovernmentBudgetMedicaidMedicareSocial SecurityThe National DeficitPolitics in GeneralHouse of RepresentativesOffice of the PresidentPresident Barack ObamaSenate

0 Comments
Posted May 18, 2013 at 11:04 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

There is a great graphic here and some comment there.

Filed under: * Culture-WatchAging / the ElderlyHealth & MedicineMiddle AgeTeens / YouthYoung Adults* Economics, PoliticsEconomyConsumer/consumer spendingPersonal FinanceTaxesThe U.S. GovernmentBudgetMedicareSocial SecurityThe National DeficitPolitics in General* TheologyEthics / Moral Theology

1 Comments
Posted April 16, 2013 at 5:45 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

Budget constraints are prompting the U.S. Navy to cut back the number of aircraft carriers in the Persian Gulf region from two to one, the latest example of how contentious fiscal battles in Washington are impacting the U.S. military.

According to Defense Department officials, the USS Harry S. Truman, which was set to leave for the Persian Gulf region on Friday, will now remain stateside, based in Norfolk, Virginia.

Defense Secretary Leon Panetta ordered the change to the department’s “two-carrier policy” in the Persian Gulf region early Wednesday.

Read it all.

Filed under: * Economics, PoliticsDefense, National Security, MilitaryEconomyThe U.S. GovernmentBudget* International News & CommentaryMiddle EastEgypt

1 Comments
Posted February 6, 2013 at 7:05 pm [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

The CBO forecast finds a persistent mismatch between tax revenue and spending over the coming decade. As the economy improves, tax revenue should rise to 19 percent of GDP for the period from 2015 through 2023, up from 15.8 percent in 2012, the report said. But federal spending, after an early-decade dip, will start rising persistently faster than revenues.

"After 2017, if current laws remain in place, outlays will start growing again as a percentage of GDP," the CBO said. "The aging of the population, increasing health care costs, and a significant expansion of eligibility for federal subsidies for health insurance will substantially boost spending for Social Security and for major health care programs relative to the size of the economy."

The CBO's current-law "baseline" calls for spending to reach about 23 percent of GDP in 2023 and, more worrisome, to be "on an upward trajectory."

Read it all.

Update: An IBD article is also available on this, entitled "CBO Report Shows We're Still Headed Toward A Fiscal Cliff" and it may be found there.



Filed under: * Culture-WatchAging / the Elderly* Economics, PoliticsEconomyThe Credit Freeze Crisis of Fall 2008/The Recession of 2007--The U.S. GovernmentBudgetMedicareSocial SecurityThe National DeficitPolitics in GeneralHouse of RepresentativesOffice of the PresidentPresident Barack ObamaSenate

0 Comments
Posted February 6, 2013 at 7:14 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

The U.S. economy shrank for the first time in more than three years in the fourth quarter, underscoring the halting nature of the recovery. But the strength of consumer spending and business investment suggested that the economy will grow, albeit slowly, this year.

Gross domestic product—the broadest measure of goods and services churned out by the economy—fell at a 0.1% annual rate in the fourth quarter of 2012, according to the government's initial estimate out Wednesday.

The details weren't as discouraging as the headline. The drop, a surprise, was driven by a sharp fall in government spending and by businesses putting fewer goods on warehouse shelves, as well as by a decline in exports. The mainstays of the domestic private economy—housing, consumer spending and business investment in equipment and software—were stronger.

Read it all.

Filed under: * Economics, PoliticsEconomyConsumer/consumer spendingCorporations/Corporate LifeThe U.S. GovernmentBudget* International News & CommentaryAmerica/U.S.A.

0 Comments
Posted January 31, 2013 at 5:35 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

Every day more than 1.5 million Ohioans, nearly 14 percent of our population, wake up without health insurance coverage. As a result, many of them go without treatment until their condition becomes more severe and more costly to address. Often when they do seek treatment, it is in the most expensive way possible: through emergency rooms and hospitals. The cost of caring for the uninsured falls to everyone. Those with health coverage pay more in treatment costs, and we all pay more in taxes to support local and state public health programs.

This budget cycle the Governor and legislature have an opportunity to control health care costs for the benefit of all Ohioans by expanding our Medicaid program, as provided for in the federal Affordable Care Act (ACA). To do so is consistent with Gov. Kasich's efforts over the last two years to transform Medicaid in Ohio - reducing costs and improving the program's efficiency.
As Christian leaders, we hear the call of Jesus to reach out to the poor and those on the margins of society. We believe that Medicaid Expansion will help stabilize health care to the poor and marginalized among us. We are leaders of a faith community that believes all are equal in the sight of God.

Read it all.

Filed under: * Anglican - EpiscopalEpiscopal Church (TEC)TEC Bishops* Culture-WatchHealth & Medicine* Economics, PoliticsEconomyThe U.S. GovernmentBudgetMedicare

3 Comments
Posted January 28, 2013 at 3:58 pm [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

The $1.2tn in automatic spending cuts that Barack Obama once promised to avert are looking increasingly likely to occur because of entrenched politics in Washington, threatening a shock to confidence in the US economy.

Economists have long assumed that the so-called sequester – a budgetary mechanism passed in 2011 that takes effect on March 1 and slashes the Pentagon’s budget by $600bn over 10 years while cutting discretionary spending for government programmes by another $600bn – would be replaced or reversed by Congress.

Many saw a recent move by Republicans on Capitol Hill to extend the US borrowing authority as a sign of greater co-operation with the White House. But conservative lawmakers have recently made it clear that they were simply gearing up for another fight, and are prepared to take a hard line on the $1.2tn in cuts even amid objections from military hawks.

Read it all (may require subscription).


Filed under: * Economics, PoliticsDefense, National Security, MilitaryEconomyThe U.S. GovernmentBudgetPolitics in GeneralHouse of RepresentativesOffice of the PresidentPresident Barack ObamaSenate

4 Comments
Posted January 28, 2013 at 5:30 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

We agree with Obama that it will take a combination of tax increases and spending cuts to put the government's fiscal house in order. Republicans swallowed hard and accepted an increase in tax rates for the highest incomes to start the year. It's the Democrats' turn to recognize that federal benefit programs, and particularly healthcare entitlements such as Medicare and Medicaid, are on an unsustainable path despite the savings from the 2010 healthcare law.

Obama should lead a Democratic push for reforms that preserve these programs for those who need them, while also reducing the deficit and stopping the federal debt from growing faster than the economy. He's in the best position to lead on this issue, able to provide political cover for Democrats concerned that their constituents won't put up with changes to the status quo, while showing Republicans that there are ways to save money without abandoning the government's commitment to the elderly and poor. To create an opening for the rest of his agenda, he needs to step up to that role.

Read it all.

Filed under: * Culture-WatchAging / the ElderlyHealth & Medicine* Economics, PoliticsEconomyThe U.S. GovernmentBudgetMedicareSocial SecurityThe National DeficitPolitics in GeneralHouse of RepresentativesOffice of the PresidentPresident Barack ObamaSenate* TheologyEthics / Moral Theology

0 Comments
Posted January 24, 2013 at 4:40 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

A political class that botched the fiscal cliff so badly are not going to be capable of a gigantic deal on complex issues. It’s like going into a day care center and asking a bunch of infants to perform “Swan Lake.”
--David Brooks in a piece on today's NY Times Op-ed page entitled "The Next Four Years"

Filed under: * Economics, PoliticsEconomyTaxesThe U.S. GovernmentBudgetMedicareSocial SecurityPolitics in GeneralHouse of RepresentativesOffice of the PresidentPresident Barack ObamaSenate* TheologyPastoral Theology

0 Comments
Posted January 18, 2013 at 8:09 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

In the House, the majority Republican party says it won't raise the debt limit without spending cuts of equivalent amounts. Mr. Obama has said he won't negotiate over the matter, saying it is the responsibility of Congress to enable the government to pay bills it has incurred.

The government spends 40% more than it takes in and borrows money to cover the difference. Without an increase in the debt ceiling, the Treasury won't be able to borrow the additional money needed to pay all its bills.

Failure to make payment on even some of its obligations could wreak havoc in the economy and financial markets and possibly trigger another financial crisis and recession, analysts have warned.

Read it all.


Filed under: * Economics, PoliticsEconomyThe U.S. GovernmentBudgetMedicareSocial SecurityThe National DeficitPolitics in GeneralHouse of RepresentativesOffice of the PresidentPresident Barack ObamaSenate

0 Comments
Posted January 14, 2013 at 7:00 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

The Congressional Budget Office projects that over the next decade Social Security's annual cash deficit will rise by nearly $100 billion, reaching $155 billion a year. The cost of servicing the extra public debt tied to cashing in $1 trillion worth of Social Security's intragovernmental IOUs over the 10 years would add $40 billion to the deficit in 2022 alone, an IBD analysis finds.

Overall, Social Security would account for nearly $200 billion in annual deficits or nearly 20% of the $1 trillion-plus deficit that would occur under current policies, including fiscal-cliff tax hikes.

Then, over the following decade, the retirement program's impact on deficits would really balloon.

Read it all.

Filed under: * Culture-WatchAging / the ElderlyHistory* Economics, PoliticsEconomyThe U.S. GovernmentBudgetSocial SecurityThe National DeficitPolitics in GeneralHouse of RepresentativesOffice of the PresidentPresident Barack ObamaSenate

1 Comments
Posted January 14, 2013 at 6:30 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

While many in Washington are breathing a sigh of relief and some are trying to spin the outcome as a win for the president, those who characterize this bill as a genuine victory for anyone at all have clearly lost perspective. The deal brokered by Vice President Joe Biden and Senate Minority Leader Mitch McConnell does make good on President Obama's promise to bring a little more equity to the tax code by raising rates on wealthier Americans, and it temporarily averts the most draconian "sequestration" cuts. But the list of what it does not do, and what it does wrong, is long.

By midday Tuesday, the Congressional Budget Office had concluded that the Biden-McConnell package would add nearly $4 trillion to federal deficits over the next 10 years. This was largely because it actually extends and makes permanent more than 80% of the Bush tax cuts. So much for the idea that this whole struggle was supposed to help America get its financial house in order.

Just as bad, or perhaps worse in terms of the day-to-day lives of average people, the bill only postpones the forced cuts of sequestration by two months, to precisely the moment the country will be engaged in another ruinous debate about lifting our national debt ceiling to ensure the country can pay its bills. It thus creates a new, even more dangerous fiscal cliff....

Read it all.

Update: George Will has also written on this I see--Perils Of The Entitlement State And Our Decadent Democracy.

Filed under: * Economics, PoliticsEconomyThe U.S. GovernmentBudgetMedicareSocial SecurityThe National DeficitPolitics in GeneralHouse of RepresentativesOffice of the PresidentPresident Barack ObamaSenate* TheologyEthics / Moral Theology

2 Comments
Posted January 3, 2013 at 5:48 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

Congress' hectic resolution of the "fiscal cliff" crisis is the latest in a long series of decisions by lawmakers and the White House to do less than promised — and to ask Americans for little sacrifice — in confronting the nation's burgeoning debt.

The deal will generate $600 billion in new revenue over 10 years, less than half the amount President Barack Obama first called for. It will raise income tax rates only on the very rich, despite Obama's campaign for broader increases.

It puts off the toughest decisions about spending cuts for military and domestic programs, including Medicare and Social Security. And it does nothing to mitigate the looming partisan showdown on the debt ceiling, which must rise soon to avoid default on U.S. loans.

In short, the deal reached between Obama and congressional Republicans continues to let Americans enjoy relatively high levels of government service at low levels of taxation. The only way that's possible, of course, is through heavy borrowing, which future generations will inherit.

Read it all.

Filed under: * Economics, PoliticsEconomyTaxesThe U.S. GovernmentBudgetMedicareSocial SecurityThe National DeficitPolitics in GeneralHouse of RepresentativesOffice of the PresidentPresident Barack ObamaSenate

1 Comments
Posted January 2, 2013 at 3:54 pm [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

The budget deal passed by the U.S. Senate [and House]... would raise taxes on 77.1 percent of U.S. households, mostly because of the expiration of a payroll tax cut, according to preliminary estimates from the nonpartisan Tax Policy Center in Washington.

More than 80 percent of households with incomes between $50,000 and $200,000 would pay higher taxes. Among the households facing higher taxes, the average increase would be $1,635, the policy center said. A 2 percent payroll tax cut, enacted during the economic slowdown, is being allowed to expire as of [December 31]

Read it all.

Filed under: * Economics, PoliticsEconomyConsumer/consumer spendingPersonal FinanceTaxesThe U.S. GovernmentBudgetMedicareSocial SecurityThe National DeficitPolitics in GeneralHouse of RepresentativesOffice of the PresidentPresident Barack ObamaSenate

2 Comments
Posted January 2, 2013 at 6:41 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

Congress approved a plan to end Washington’s long drama over the “fiscal cliff” late Tuesday after House Republicans surrendered to President Obama’s demand to let taxes rise on the nation’s richest households.

The House voted 257 to 167 to send the measure to Obama for his signature; the vote came less than 24 hours after the Senate overwhelmingly approved the legislation.

Read it all.

Update: Here are the new numbers for 2013 in Congress--Democrats control of the Senate by 55 to 45 (change of 2) and Republicans control of the House of Representatives by 234-201 (change of 8)

Filed under: * Economics, PoliticsEconomyConsumer/consumer spendingCorporations/Corporate LifePersonal FinanceTaxesThe U.S. GovernmentBudgetMedicareSocial SecurityThe National DeficitPolitics in GeneralHouse of RepresentativesOffice of the PresidentPresident Barack ObamaSenate* TheologyEthics / Moral Theology

1 Comments
Posted January 2, 2013 at 6:22 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

A US Senate-backed deal [by a vote of 89-8] to stave off a "fiscal cliff" of drastic taxation and spending measures has passed to the House of Representatives.

President Barack Obama has urged the House to pass the bill "without delay".

However, several representatives have spoken out against it, with one calling it "bad for America".

Read it all.

Filed under: * Economics, PoliticsEconomyTaxesThe U.S. GovernmentBudgetMedicareSocial SecurityPolitics in GeneralHouse of RepresentativesOffice of the PresidentPresident Barack ObamaSenate

0 Comments
Posted January 1, 2013 at 1:00 pm [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

Senate leaders are racing against the clock to reach a "fiscal cliff" deal the House and Senate can approve on New Year's Eve.

Leaders in the upper chamber narrowed their differences Sunday as Republicans agreed to drop a demand to curb cost-of-living increases to entitlement benefits, while Democrats showed flexibility on taxes.

Yet after months of talks on ways to avoid the fiscal cliff of tax hikes and spending cuts at the end of 2012, House and Senate lawmakers find themselves approaching the new year without a bill to present to their members.
Significant differences remain over two key parts of a deal — the automatic spending cuts known as the sequester and the estate tax.

Read it all.

Update: a BBC article is there.

I will take comments on this submitted by email only to at KSHarmon[at]mindspring[dot]com.

Filed under: * Economics, PoliticsEconomyConsumer/consumer spendingCorporations/Corporate LifeTaxesThe U.S. GovernmentBudgetMedicareSocial SecurityThe National DeficitPolitics in GeneralHouse of RepresentativesOffice of the PresidentPresident Barack ObamaSenate

0 Comments
Posted December 31, 2012 at 5:45 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

When President Obama talks about taxing the rich, he means the top 2 percent of Americans. John A. Boehner, the House speaker, talks about an even thinner slice. But the current and future fiscal imbalances are too large to exempt 98 percent or more of the public from being part of the solution.

Ultimately, unless we scale back entitlement programs far more than anyone in Washington is now seriously considering, we will have no choice but to increase taxes on a vast majority of Americans. This could involve higher tax rates or an elimination of popular deductions. Or it could mean an entirely new tax, such as a value-added tax or a carbon tax.

To be sure, the path ahead is not easy. No politician who wants to be re-elected is eager to entertain the possibility of higher taxes on the middle class. But fiscal negotiations might become a bit easier if everyone started by agreeing that the policies we choose must be constrained by the laws of arithmetic.

Read it all.

Filed under: * Economics, PoliticsEconomyPersonal FinanceTaxesThe U.S. GovernmentBudgetMedicareSocial SecurityThe National DeficitPolitics in GeneralHouse of RepresentativesOffice of the PresidentPresident Barack ObamaSenate

1 Comments
Posted December 30, 2012 at 5:26 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

Whether or not there is a deal, the weeks since the election have produced a stark display of political gridlock. "The government is not working," said Steve Bell, senior director of the Bipartisan Policy Center, who was a senior budget adviser to Senate Republicans for many years. "There is no doubt that the policy-making apparatus in this town has collapsed."

Following the tea-party wave in the 2010 election, the 112th Congress looks set to be the least productive in recent history. By the end of November, the House had passed 146 bills over the previous two years, by far the smallest number for any Congress since 1948. The Senate passed fewer bills in 2012 than in any year since at least 1992.

Rather than smoothing over differences, the November election appears to have hardened them. "We came out of the election with both sides thinking they won and had an equal mandate," said Ross Baker, a professor at Rutgers University who is now interviewing lawmakers on Capitol Hill for a book on bipartisanship. "One problem is we don't have a common narrative to guide us."

Read it all.

I will take comments on this submitted by email only to at KSHarmon[at]mindspring[dot]com.


Filed under: * Culture-WatchHistoryPsychology* Economics, PoliticsEconomyConsumer/consumer spendingCorporations/Corporate LifeTaxesThe Credit Freeze Crisis of Fall 2008/The Recession of 2007--The U.S. GovernmentBudgetMedicareSocial SecurityThe National DeficitPolitics in GeneralHouse of RepresentativesOffice of the PresidentPresident Barack ObamaSenate* International News & CommentaryAmerica/U.S.A.


Posted December 28, 2012 at 6:30 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

A long line of America's top chief executives have rotated through Washington in recent weeks, loudly urging lawmakers and the White House to reach a broad deal to fix the budget. They once sounded optimistic. Now many of them aren't talking, and if they are, they're gloomy.

Mark Bertolini, chief executive of health-insurance company Aetna Inc., called the state of play "pitiful and embarrassing," saying the chances are growing that a deal might not be reached by the end of the year to avert $500 billion in tax increases and spending cuts.

"Set aside my interest as the CEO of a participant in the economy here—as an American, I'm embarrassed if that's where we end up," Mr. Bertolini said in an interview. "It feels like it's starting to fall apart."

Read it all.

Filed under: * Economics, PoliticsEconomyCorporations/Corporate LifeTaxesThe U.S. GovernmentBudgetMedicareSocial SecurityPolitics in GeneralHouse of RepresentativesOffice of the PresidentPresident Barack ObamaState Government

0 Comments
Posted December 21, 2012 at 6:31 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

Budget negotiations between the White House and Republican House Speaker John Boehner have progressed steadily in recent days, people close to the process said, breathing life into talks that appeared to have stalled.

Both sides still face sizable differences before any agreement might be reached by the end of the year, and talks could well falter again over such controversial issues as taxes and Medicare before any deal is ultimately reached.

The people familiar with the matter say talks have taken a marked shift in recent days as staff and leaders have consulted, becoming more "serious." Both sides have agreed to keep details private, according to the people, who declined to detail where new ground was being broken.

Read it all.

Filed under: * Economics, PoliticsEconomyConsumer/consumer spendingCorporations/Corporate LifeCredit MarketsCurrency MarketsTaxesThe Credit Freeze Crisis of Fall 2008/The Recession of 2007--The U.S. GovernmentBudgetMedicareSocial SecurityThe National DeficitPolitics in GeneralHouse of RepresentativesOffice of the PresidentPresident Barack Obama

0 Comments
Posted December 10, 2012 at 5:01 pm [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

From there:
[Here is a list of]...the most expensive tax breaks in the current tax code, based on what those breaks would cost the U.S. Treasury in lost revenue from 2013 to 2017:

1) Exclusion of employer contributions for medical insurance premiums & medical: $1 trillion

2) Mortgage interest deduction: $606 billion

3) Deduction for 401(k) plans: $429 billion

4) Accelerated depreciation of machinery & equipment: $375 billion

5) Exclusion of net imputed rental income: $337 billion

6) Capital gains: $321 billion

7) Charitable contributions: $293 billion


Filed under: * Economics, PoliticsEconomyConsumer/consumer spendingCorporations/Corporate LifeTaxesThe U.S. GovernmentBudgetThe National DeficitPolitics in GeneralHouse of RepresentativesOffice of the PresidentPresident Barack ObamaSenate* TheologyEthics / Moral Theology

3 Comments
Posted December 6, 2012 at 5:30 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

....seasoned Washington hands say that once this rather gloomy back and forth has played out - and it might take another week or more - the work towards reaching a solution that both sides can sell to their parties and their lawmakers will begin in earnest.

A deal by Christmas, a week before the fiscal cliff deadline, remains uncertain but not out of the question. The so-called fiscal cliff is a combination of U.S. government spending cuts and tax increases due to be implemented under existing law in early 2013 that may cut the federal budget deficit but also tip the economy back into recession.

The pattern of little happening until very close to a holiday is well-established on Capitol Hill. The past three pre-Christmas seasons brought important eleventh-hour developments on health care in 2009, tax cut extensions in 2010 and the payroll tax holiday in 2011.

Read it all.

Filed under: * Economics, PoliticsEconomyConsumer/consumer spendingCorporations/Corporate LifeHousing/Real Estate MarketLabor/Labor Unions/Labor MarketPersonal FinanceStock MarketTaxesThe U.S. GovernmentBudgetMedicareSocial SecurityThe National DeficitPolitics in GeneralHouse of RepresentativesOffice of the PresidentPresident Barack ObamaSenate

0 Comments
Posted December 3, 2012 at 3:26 pm [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

....President Obama's call for a return to Clinton-era tax rates is misleading: If the Bush upper-income tax cuts go away, tax rates will exceed those in place at the end of the 1990s.

The top effective federal marginal tax rate on work income would rise to roughly 44.6% from 37.9% in 2012.

That's higher than under President Clinton because of a 0.9-percentage-point Medicare payroll tax hike for upper-income households, which passed with Obama-Care and takes effect in January.

Tax rates on long-term capital gains also will be higher than when Clinton left office if Bush tax cuts expire as ObamaCare's new 3.8% Medicare tax on investment gains takes effect. Up to now, only wage and salary income has been subject to Medicare taxes.

Read it all.

Filed under: * Economics, PoliticsEconomyTaxesThe U.S. GovernmentBudgetMedicareSocial SecurityThe National DeficitPolitics in GeneralHouse of RepresentativesOffice of the PresidentPresident Barack ObamaSenate* TheologyEthics / Moral Theology

1 Comments
Posted December 3, 2012 at 9:01 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

At first blush, it seems to make policy sense, too. The rich fabric of America’s civic life, from Boy Scouts to community orchestras to soup kitchens, is the envy of the world. Its diversity reflects in part how much it depends on private givers with diverse interests and motives, and not just on the government. Their giving is encouraged by the charitable deduction, enacted in 1917, just four years after the income tax itself. The deduction lets people feel they are beating the system even as they practice virtue.

But there’s a question of fairness that complicates the issue. Overwhelmingly, the deduction benefits the wealthy — and the rest of the country has to make up the gap.

Read it all.

Filed under: * Culture-WatchCharities/Non-Profit Organizations* Economics, PoliticsEconomyTaxesThe U.S. GovernmentBudgetMedicareSocial SecurityThe National DeficitPolitics in GeneralHouse of RepresentativesOffice of the PresidentPresident Barack ObamaSenate

18 Comments
Posted December 3, 2012 at 8:00 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

I listened to NPR yesterday for over an hour back and forth from a doctors appointment.

The entire time they talked about President Obama's proposal to implement the middle class tax cut now.
Everywhere I turn its middle class tax cut, middle class tax cut...

Except it isn't but no one thinks about these things.

What is being proposed is not letting the current tax code STAY THE SAME.
So 98% of Americans WON"T HAVE A TAX INCREASE.

Since when is not having an increase a cut?

Anyone you know say I am getting the same number of days vacation this year as last year I am angry I get a benefits cut!

Filed under: * By Kendall* Economics, PoliticsEconomyPersonal FinanceTaxesThe U.S. GovernmentBudgetMedicareSocial SecurityThe National DeficitPolitics in GeneralHouse of RepresentativesOffice of the PresidentSenate


Posted November 29, 2012 at 9:07 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

President Obama’s re-election and Democratic gains in Congress were supposed to make it easier for the party to strike a deal with Republicans to resolve the year-end fiscal crisis by providing new leverage. But they could also make it harder as empowered Democrats, including some elected on liberal platforms, resist significant changes in entitlement programs like Social Security and Medicare.

As Congress returned Monday, the debate over those programs, which many Democrats see as the core of the party’s identity, was shaping up as the Democratic version of the higher-profile struggle among Republicans over taxes.

In failed deficit reduction talks last year, Mr. Obama signaled a willingness to consider substantial changes in the social safety net, including a gradual increase in the eligibility age for Medicare and limits in the growth rate of future Social Security benefits. An urgent question hanging over the new round of deficit talks is which of those changes Mr. Obama and Congressional Democrats would accept today....

Read it all.

Filed under: * Economics, PoliticsEconomyThe Credit Freeze Crisis of Fall 2008/The Recession of 2007--The U.S. GovernmentBudgetMedicareSocial SecurityThe National DeficitPolitics in GeneralHouse of RepresentativesOffice of the PresidentPresident Barack ObamaSenate

0 Comments
Posted November 27, 2012 at 5:30 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

For the first time in decades, a bipartisan consensus has emerged in Washington to raise taxes. But negotiators working to avert the year-end “fiscal cliff” remain far apart on crucial details, including how taxes should go up and who should pay more.

Neither side gave ground in an opening round of staff-level talks last week at the Capitol. As President Obama and congressional leaders prepare for a second face-to-face meeting as soon as this week, the divide over taxes presents the biggest obstacle to replacing the heap of abrupt tax hikes and spending cuts, set to hit in January, with a less-traumatic debt-reduction plan.

People in both parties are exploring ideas for bridging the gap. Without a deal on taxes, there is not much hope for agreement on a broader strategy for restraining the national debt that also tackles the skyrocketing cost of federal retirement programs such as Social Security and Medicare.

Read it all.

Filed under: * Economics, PoliticsEconomyTaxesThe U.S. GovernmentBudgetMedicareSocial SecurityThe National DeficitPolitics in GeneralHouse of RepresentativesOffice of the PresidentPresident Barack ObamaSenate

3 Comments
Posted November 26, 2012 at 6:30 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

Congressional negotiators, trying to avert a fiscal crisis in January, are examining ideas that would allow effective tax rates to rise for the wealthy without technically raising the top tax rate of 35 percent. They hope the proposals will advance negotiations by allowing both parties to claim they stood their ground.

One possible change would tax the entire salary earned by those making more than a certain level — $400,000 or so — at the top rate of 35 percent rather than allowing them to pay lower rates before they reach the target, as is the standard formula. That plan would allow Republicans to say they did not back down in their opposition to raising marginal tax rates and Democrats to say they prevailed by increasing effective tax rates on the rich. At the same time, it would provide an initial effort to reduce the deficit, which the negotiators call a down payment, as Congressional tax-writing committees hash out a broad overhaul of the tax code.

That idea could be combined with the reinstatement of tax code provisions that once prevented the rich from taking personal exemptions or itemizing deductions. Those rules were eliminated by the tax cut of 2001. Reinstating them would tack an additional one to two percentage points onto the effective tax rates of high-income households without raising the 35 percent rate, but which households would be affected has not been decided. In all, tax experts say, families in the top tax bracket would find their effective tax rate jump to 41 percent, even though the top statutory rate would remain 35 percent.

Read it all.

Filed under: * Economics, PoliticsEconomyConsumer/consumer spendingCorporations/Corporate LifeHousing/Real Estate MarketLabor/Labor Unions/Labor MarketThe U.S. GovernmentBudgetThe National DeficitPolitics in GeneralHouse of RepresentativesOffice of the PresidentPresident Barack ObamaSenateUS Presidential Election 2012

5 Comments
Posted November 23, 2012 at 9:27 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

Most of the increases would result from the expiration of Bush-era tax cuts, which would cause marginal rates to rise. Simultaneously, several temporary tax breaks pushed by President Barack Obamaafter the financial crisis also would end.

And most households—121 million in all—would be hit by an increase in the payroll tax that employees pay to 6.2% from 4.2%.

Also expiring at year-end is a provision to reduce the so-called marriage penalty, a set of tax provisions that require many couples to pay higher taxes when they file jointly. And millions more families' earnings this year would be subject to the alternative minimum tax. The AMT was originally intended to prevent the very wealthy from avoiding taxes but would apply to middle-class households if policy makers don't renew a provision that expired last year.

Read it all.

Filed under: * Economics, PoliticsEconomyConsumer/consumer spendingCorporations/Corporate LifePersonal FinanceTaxesThe Credit Freeze Crisis of Fall 2008/The Recession of 2007--The U.S. GovernmentBudgetThe National DeficitPolitics in GeneralHouse of RepresentativesOffice of the PresidentPresident Barack ObamaSenateUS Presidential Election 2012

0 Comments
Posted November 21, 2012 at 5:30 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

...the biggest loopholes in the U.S. Tax Code — generally referred to as tax expenditures — aren’t just the tricks of the trade for millionaires with offshore bank accounts. For the vast majority of Americans, they’re just how things work: You don’t pay taxes on your health insurance or Medicare benefits; you contribute tax-free to your 401(k); and your mortgage interest pushes down your tax bill each year.

And even if you dump the biggest of the set, these tax perks don’t even come close to closing the deficit. At best, the top 10 would pull in an extra $834 billion a year, according to Joint Committee on Taxation figures. Considering the hole lawmakers are trying to fill is several trillion dollars large, it’s clear they wouldn’t even come close.

Here are the 10 biggest tax loopholes — and the reasons why most of them will survive the fiscal cliff....

Read it all.

Filed under: * Culture-WatchHealth & Medicine* Economics, PoliticsEconomyConsumer/consumer spendingCorporations/Corporate LifePersonal FinanceTaxesThe U.S. GovernmentBudgetThe National DeficitPolitics in GeneralHouse of RepresentativesOffice of the PresidentPresident Barack ObamaSenateUS Presidential Election 2012

1 Comments
Posted November 20, 2012 at 12:04 pm [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

Of the two programs, Social Security is by far the easier to fix. In 1983, a bipartisan agreement shored up the program for decades. It can be rescued again, much as it was then, by gradually raising the retirement age for able-bodied workers and bumping up the payroll tax. Other options include slowly reducing the rate of benefit growth, raising the wage cap and tightening eligibility requirements for disability

The more urgent and difficult issue is the surge in spending on Medicare, Medicaid and related programs. The numbers tell the story. In 1990, Washington spent $180 billion on health care, accounting for 14% of federal spending. In 2017, the expected tab is $1.4 trillion, or 30% of federal spending. As President Obama said at his news conference Wednesday, "Health care costs continue to be the biggest driver of our deficits."

One obvious place to start is bringing the Medicare eligibility age in line with that of Social Security. In their failed budget negotiations in 2011, Obama and House Speaker John Boehner tentatively agreed to raise it from 65 to 67. Such a rise would cut the government's bill while increasing the share of the population in market-based health care.

Read it all.

Filed under: * Economics, PoliticsEconomyThe U.S. GovernmentBudgetMedicareSocial SecurityThe National DeficitPolitics in General

11 Comments
Posted November 15, 2012 at 11:55 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

The Federal Housing Administration is expected to report this week it could exhaust its reserves because of rising mortgage delinquencies, according to people familiar with the agency's finances, a development that could result in the agency needing to draw on taxpayer funding for the first time in its 78-year history.

Such a report would likely set off a political fight over the government's role in housing, as it raises the prospect of billions of dollars being added to the U.S. government's effort to stabilize the hard-hit sector in the aftermath of the 2008 financial crisis, which already includes $137 billion spent to bail out Fannie Mae and Freddie Mac. Together with Fannie and Freddie, federal agencies are backing nearly nine in 10 new mortgages.

Read it all.

Filed under: * Economics, PoliticsEconomyHousing/Real Estate MarketThe Credit Freeze Crisis of Fall 2008/The Recession of 2007--The U.S. GovernmentBudgetThe National Deficit

0 Comments
Posted November 15, 2012 at 5:15 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

As the high-stakes wrangling over the fiscal cliff gets underway, we though it might be the proper moment to remind everybody just how the United States managed to become the world's biggest debtor.

So, here's how....

Read it all.

Filed under: * Culture-WatchHistory* Economics, PoliticsEconomyTaxesThe U.S. GovernmentBudgetCensus/Census DataMedicareSocial SecurityThe National DeficitPolitics in General

1 Comments
Posted November 15, 2012 at 4:40 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

Should lawmakers not reach agreement prior to the end of the year, the US budget deficit for 2013 would be cut almost in half, to $560 billion.

Which doesn't sound like a bad thing. After all, the US is staggering under a monumental pile of debt and could potentially begin to face the kinds of difficulties that have plunged several euro-zone countries into crisis. It is a viewpoint shared by the ratings agencies -- a year ago, Standard & Poor's withdrew America's top rating, justifying the measure by pointing to the unending battle over the debt ceiling. The agency noted that "the political brinksmanship of recent months highlights what we see as America's governance and policymaking becoming less stable, less effective, and less predictable than what we previously believed."

From afar, it is difficult to argue; the ongoing battle between Democrats and Republicans in the face of a horrendously imbalanced budget looks catastrophically absurd. As their country heads toward the edge of the abyss, lawmakers preferred to debate whether or not French fries and pizza should be considered vegetables.

Read it all.

Filed under: * Economics, PoliticsEconomyTaxesThe U.S. GovernmentBudgetMedicareSocial SecurityThe National DeficitPolitics in GeneralHouse of RepresentativesOffice of the PresidentPresident Barack ObamaSenateUS Presidential Election 2012

15 Comments
Posted November 9, 2012 at 4:01 pm [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

Heavenly Father we ask that you will have mercy on America today and bless us in spite of ourselves. We ask that you will give wisdom to all who go to the polls to cast their votes. Help us as we make difficult decisions on a variety of issues and as we seek to elect men and women who will hunger for righteousness and seek the common good to positions of authority in our towns and cities, in our states and in our nation. We pray against any voter fraud or any corruption of proper voter access and ask that justice be done in each and every election, whatever the locale. We also pray for peace and grace with one another as the results are received and digested, through Jesus Christ our Lord, who with you and the Holy Spirit lives and reigns in glory everlasting, Amen--KSH.

Filed under: * By Kendall* Christian Life / Church LifeSpirituality/Prayer* Culture-WatchLaw & Legal Issues* Economics, PoliticsEconomyTaxesThe U.S. GovernmentBudgetPolitics in GeneralCity GovernmentHouse of RepresentativesOffice of the PresidentSenateState GovernmentUS Presidential Election 2012* TheologyEthics / Moral Theology

0 Comments
Posted November 6, 2012 at 5:46 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

Finance chiefs of the world's 20 leading economies are ringing alarm bells over the U.S. fiscal cliff and Europe's debt woes at a meeting in Mexico this weekend as they look to push back deficit reduction targets to help boost growth.

Unless a fractious U.S. Congress can reach a deal, about $600 billion in government spending cuts and higher taxes are set to kick in on January 1, threatening to push the American economy back into recession and hit world growth.

"The Americans themselves acknowledge that this is a problem," a G20 official said on condition of anonymity. "The U.S. administration says it doesn't want to fall off the fiscal cliff, but right now it can't tell us how exactly it will address it because that issue is on ice ahead of the election."

Read it all.

Filed under: * Economics, PoliticsEconomyConsumer/consumer spendingCorporations/Corporate LifeCredit MarketsCurrency MarketsG20 Housing/Real Estate MarketLabor/Labor Unions/Labor MarketPersonal FinanceStock MarketTaxesThe Banking System/SectorThe U.S. GovernmentBudgetThe National DeficitPolitics in GeneralHouse of RepresentativesOffice of the PresidentSenateUS Presidential Election 2012

0 Comments
Posted November 5, 2012 at 6:00 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

The CIA is urging the White House to approve a significant expansion of the agency’s fleet of armed drones, a move that would extend the spy service’s decade-long transformation into a paramilitary force, U.S. officials said.

The proposal by CIA Director David H. Petraeus would bolster the agency’s ability to sustain its campaigns of lethal strikes in Pakistan and Yemen and enable it, if directed, to shift aircraft to emerging al-Qaeda threats in North Africa or other trouble spots, officials said.

If approved, the CIA could add as many as 10 drones, the officials said, to an inventory that has ranged between 30 and 35 over the past few years.

Read it all.

Filed under: * Culture-WatchScience & Technology* Economics, PoliticsDefense, National Security, MilitaryEconomyThe U.S. GovernmentBudgetForeign RelationsPolitics in GeneralTerrorism* International News & CommentaryAmerica/U.S.A.

1 Comments
Posted October 22, 2012 at 6:30 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

Indeed, the impact of this latest round of unconventional monetary policy is already fading. Analysts at Morgan Stanley this week decided that returns in the high-yield market were no longer attractive in the face of deteriorating fundamentals. The stock market is struggling to make further headway, while yields on mortgage-backed securities have started to turn up after an initial drop. A drop in third-quarter capital expenditure suggests the Fed policy hasn’t been a catalyst for corporate investment at all.

One major reason for the lack of effectiveness of this latest round of quantitative easing may well be a growing concern with the “fiscal cliff”, automatic US tax rises and spending cuts due to kick in on January 1. Uncertainty over “cliff risk” – and the prospects of a deal in Congress on deficit reduction – seems to be offsetting any positive impact of Fed policies.

Read it all.

Filed under: * Economics, PoliticsEconomyConsumer/consumer spendingCorporations/Corporate LifeCredit MarketsCurrency MarketsHousing/Real Estate MarketLabor/Labor Unions/Labor MarketTaxesThe Banking System/SectorThe U.S. GovernmentBudgetFederal ReserveThe National DeficitPolitics in GeneralHouse of RepresentativesOffice of the PresidentSenate

0 Comments
Posted October 20, 2012 at 11:59 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

An Episcopal priest who, with her husband, brings in about $65,000 a year tells Marketplace that they are lower middle class. A woman posting at dcurbanmom.com identifies her family as middle class, and their income is $100,000 a year. CNN talks to a man struggling to save for his son’s education who defines “middle class” as families with too much to qualify for federal Pell Grants—which is at most about $48,000 for a family of three. I was eligible for Pell Grants, and before that for subsidized school lunches, but I’ve always understood my family of origin to be middle class.

A majority of Americans consider themselves middle class, a recent Pew survey found, despite a wide variance in their earnings. So what does “middle class” mean if it applies to most of the country? And if we are all middle class now, what are the political and cultural implications?

Read it all.

Filed under: * Culture-WatchGlobalizationPsychology* Economics, PoliticsEconomyPersonal FinanceTaxesThe U.S. GovernmentBudgetThe National DeficitPolitics in General* International News & CommentaryAmerica/U.S.A.

5 Comments
Posted October 17, 2012 at 6:15 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

From an interview with the authors of the Simpson-Bowles reform plan and Goldman Sachs CEO Lloyd Blankfein:

"...We just met with -- a dozen of the largest high-tech company CEOs in the country. Not only are they hoarding cash. All their customers, all their suppliers are. They're scared to death we're going to go over this cliff and it could be a catastrophe...."

You can find a summary article to read there, it has briefer video links, but the best use of your time is to watch the full interview over here or read the transcript (about 42 1/2 minutes). Also, David Brook's piece on the debt indulgence is worth a careful revisit.

Filed under: * Economics, PoliticsEconomyConsumer/consumer spendingCorporations/Corporate LifeCredit MarketsCurrency MarketsTaxesThe Credit Freeze Crisis of Fall 2008/The Recession of 2007--The U.S. GovernmentBudgetFederal ReserveMedicareSocial SecurityThe National DeficitPolitics in GeneralHouse of RepresentativesOffice of the PresidentSenate

4 Comments
Posted October 16, 2012 at 6:45 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

And to draw, dear reader, what I think are critical relative comparisons, look at who’s in that ring of fire alongside the U.S. There’s Japan, Greece, the U.K., Spain and France, sort of a rogues’ gallery of debtors. Look as well at which countries have their budgets and fiscal gaps under relative control – Canada, Italy, Brazil, Mexico, China and a host of other developing (many not shown) as opposed to developed countries. As a rule of thumb, developing countries have less debt and more underdeveloped financial systems. The U.S. and its fellow serial abusers have been inhaling debt’s methamphetamine crystals for some time now, and kicking the habit looks incredibly difficult.

As one of the “Ring” leaders, America’s abusive tendencies can be described in more ways than an 11% fiscal gap and a $1.6 trillion current dollar hole which needs to be filled. It’s well publicized that the U.S. has $16 trillion of outstanding debt, but its future liabilities in terms of Social Security, Medicare, and Medicaid are less tangible and therefore more difficult to comprehend. Suppose, though, that when paying payroll or income taxes for any of the above benefits, American citizens were issued a bond that they could cash in when required to pay those future bills. The bond would be worth more than the taxes paid because the benefits are increasing faster than inflation. The fact is that those bonds today would total nearly $60 trillion, a disparity that is four times our publicized number of outstanding debt. We owe, in other words, not only $16 trillion in outstanding, Treasury bonds and bills, but $60 trillion more. In my example, it just so happens that the $60 trillion comes not in the form of promises to pay bonds or bills at maturity, but the present value of future Social Security benefits, Medicaid expenses and expected costs for Medicare. Altogether, that’s a whopping total of 500% of GDP, dear reader, and I’m not making it up. Kindly consult the IMF and the CBO for verification. Kindly wonder, as well, how we’re going to get out of this mess.

Please take the time to read it all and examine the chart closely. The only difference on this between Mr. Gross and myself is that I believe he understates the problem with the 60 trillion dollar figure. As has been discussed on the blog in the past, the correct figure may be as much as three plus times that amount--KSH.

Filed under: * Culture-WatchGlobalizationHistoryPsychology* Economics, PoliticsEconomyCredit MarketsCurrency MarketsTaxesThe U.S. GovernmentBudgetMedicareSocial SecurityPolitics in GeneralHouse of RepresentativesOffice of the PresidentSenate

16 Comments
Posted October 2, 2012 at 7:00 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

According to the non-partisan Tax Policy Center, the U.S. is on the threshold of one of the largest tax increases in history, a tax hike that could average $3,500 for every American household.

Without actions from Congress, the report says taxes will go up next year by 20 percent, or $536 billion overall. It will hit Americans at every income level including those living below the poverty line. For a middle income family making $40,000 per year, the tax increase is $2,000.

Read it all.

Filed under: * Economics, PoliticsEconomyConsumer/consumer spendingPersonal FinanceTaxesThe Credit Freeze Crisis of Fall 2008/The Recession of 2007--The U.S. GovernmentBudgetThe National DeficitPolitics in GeneralHouse of RepresentativesOffice of the PresidentSenate* International News & CommentaryAmerica/U.S.A.

8 Comments
Posted October 2, 2012 at 6:30 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

Would an expansion of Medicaid under the federal health-care law help or hinder South Carolina’s finances? Depends who you ask.

Strains of disagreement are building against the backdrop of a campaign by Gov. Nikki Haley’s administration to build opposition to an expansion.

Generally opposed by Republicans and favored by Democrats, the debate over whether to expand the Medicaid program in the states is set to play out in many statehouses across the country. That’s because a June Supreme Court ruling made the extension of coverage optional.

In the Palmetto State, advocates for the expansion contend Haley’s administration is emphasizing the costs and underselling offsetting economic benefits of an expansion.

Read it all.

Filed under: * Culture-WatchAging / the ElderlyHealth & Medicine--The 2009 American Health Care Reform DebateLaw & Legal IssuesPoverty* Economics, PoliticsEconomyConsumer/consumer spendingCorporations/Corporate LifeThe U.S. GovernmentBudgetPolitics in GeneralState Government* South Carolina

0 Comments
Posted September 24, 2012 at 8:00 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon



Watch it all.



Filed under: * Economics, PoliticsEconomyTaxesThe U.S. GovernmentBudgetMedicareSocial SecurityThe National Deficit

0 Comments
Posted September 1, 2012 at 4:32 pm [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

More big U.S. companies are reincorporating abroad despite a 2004 federal law that sought to curb the practice. One big reason: Taxes.

Companies cite various reasons for moving, including expanding their operations and their geographic reach. But tax bills remain a primary concern. A few cite worries that U.S. taxes will rise in the future, especially if Washington revamps the tax code next year to shrink the federal budget deficit.

Read it all.

Filed under: * Culture-WatchGlobalizationLaw & Legal Issues* Economics, PoliticsEconomyCorporations/Corporate LifeTaxesThe U.S. GovernmentBudgetPolitics in General* TheologyEthics / Moral Theology

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Posted August 30, 2012 at 8:02 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

It's game on. But to understand the contest — and the associated scare tactics — it's best to first understand a few unpleasant facts that are not in dispute:

•The popular old-age health insurance plan is on a financially unsustainable course. Medicare's payroll tax and premiums that beneficiaries pay cover barely half the program's costs, and as Baby Boomers retire, things will get worse. The tab is projected to rise rapidly: 7.6% a year for the doctor-care part of Medicare and 8.8% for the program's prescription drug benefit, for example. The economy, a rough proxy for the nation's ability to afford this, is growing less than 2% a year, leaving a huge gap.
•There is no painless fix. Both presidential candidates have committed to detailed plans for curbing costs, and no matter who wins, beneficiaries will pay more or get less, likely both. People who say otherwise are deluding themselves. As economist Herb Stein famously said: Anything that can't go on forever won't.

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Filed under: * Culture-WatchAging / the ElderlyHealth & MedicineMiddle AgeYoung Adults* Economics, PoliticsEconomyConsumer/consumer spendingCorporations/Corporate LifePersonal FinanceTaxesThe U.S. GovernmentBudgetMedicareThe National DeficitPolitics in GeneralOffice of the President* TheologyEthics / Moral Theology

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Posted August 21, 2012 at 12:05 pm [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

Most economists surveyed by USA TODAY have little faith a divided Congress will adequately address looming tax increases and spending cuts, significantly hampering economic growth well into 2013.

The standoff in Washington, along with the global economic slowdown, threatens a U.S. economy that otherwise would be gaining steam on a strengthening U.S. housing market and improving private-sector balance sheets, economists say. The survey of 50 leading economists was conducted Aug. 3-8.

Fifty-three percent of those surveyed don't think Congress will be able to lessen the impact of $560 billion in tax increases and spending cuts, slated to take effect at year's end, in a way that avoids significant damage to the economy. The Congressional Budget Office says the so-called fiscal cliff would slice up to 4 percentage points off growth next year -- causing the economy to contract in the first half -- if all the deficit-slicing measures occur at once.

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Filed under: * Economics, PoliticsEconomyConsumer/consumer spendingCorporations/Corporate LifeTaxesThe Credit Freeze Crisis of Fall 2008/The Recession of 2007--The U.S. GovernmentBudgetThe National DeficitPolitics in GeneralHouse of RepresentativesOffice of the PresidentPresident Barack ObamaSenate

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Posted August 13, 2012 at 12:05 pm [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

Over at Capital Economics they’re spotlighting Aug. 9, 2007 as the “the unofficial onset of the global credit crunch” making tomorrow the fifth anniversary of, well, the beginning of the end of the uber-loose financial conditions that begat the U.S. housing boom, bust, financial crisis, bailout-a-palooza, deep recession and — if you believe Reinhart and Rogoff — the economic sluggishness we’re still contending with.

Of course, it’s a little bit squishy declaring any one moment the “start” of something. Some would argue that the birth of the securitization market way back in the 1980s might have been the true start of what eventually became the U.S. housing morass. Still, it’s instructive to remember what was going on in early August 2007, which was when the cracks in the foundation of global finance really started to get noticeable and the themes that have come to define the market for the last half-decade started to emerge.

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Filed under: * Culture-WatchGlobalization* Economics, PoliticsEconomyConsumer/consumer spendingCorporations/Corporate LifeCredit MarketsCurrency MarketsEuroEuropean Central BankThe Banking System/SectorThe Credit Freeze Crisis of Fall 2008/The Recession of 2007--The U.S. GovernmentBudgetFederal ReserveThe National DeficitPolitics in General* International News & CommentaryEurope--European Sovereign Debt Crisis of 2010

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Posted August 9, 2012 at 8:02 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

The greatest economic catastrophe of the postwar world began five years ago today. Its consequences are still with us.

On this day in 2007 BNP Paribas, the French bank, halted withdrawals from three investment funds linked to the US subprime mortgage market. Risky financial products had spread a contagion of bad debts through the banking system. The interbank lending market froze because banks feared that they would not get their money back. The consequences included the first run on a British bank in more than a century (Northern Rock), the biggest corporate failure in American history (Lehman Brothers), and a huge recession.

With hindsight, this was not merely a crisis but a catastrophe that still overshadows the global economy. The crash was a far-reaching problem of solvency. It was not simply a banking crisis, but a debt crisis. It has not simply sunk financial institutions, but submerged governments too. Five years on, there are three questions. How did it happen? When will it end? What, if anything, can we do about it?

Read it all (requires subscription).

Filed under: * Culture-WatchHistory* Economics, PoliticsEconomyConsumer/consumer spendingCorporations/Corporate LifeCredit MarketsCurrency MarketsEuroEuropean Central BankHousing/Real Estate MarketLabor/Labor Unions/Labor MarketThe Banking System/SectorThe Credit Freeze Crisis of Fall 2008/The Recession of 2007--The U.S. GovernmentBudgetFederal ReserveThe National DeficitPolitics in General* International News & CommentaryEurope--European Sovereign Debt Crisis of 2010

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Posted August 9, 2012 at 8:00 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

Quick Stats[:]
As of 2012-06 the civilian labor force was 155,163,000
As of 2012-06 there were 111,145,000 in the private workforce
As of 2012-06 there were 56,174,538 collecting some form of SS or disability benefit
Ratio of SS beneficiaries to private employment just passed the 50% mark (50.54%)
....As of May 2012, the outlays are $756.9 billion annualized. Fewer worker relatively speaking, support more and more recipients with exponentially growing payments. This is supposed to work?

Read it all from Mish's economics blog (another from the long queue of should-have-already-been-posted material).

Filed under: * Culture-WatchAging / the ElderlyMiddle AgePsychologyYoung Adults* Economics, PoliticsEconomyCredit MarketsLabor/Labor Unions/Labor MarketTaxesThe U.S. GovernmentBudgetCensus/Census DataMedicareSocial SecurityThe National DeficitPolitics in GeneralHouse of RepresentativesOffice of the PresidentSenate* International News & CommentaryAmerica/U.S.A.

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Posted August 9, 2012 at 4:40 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

“I voted for [Walker] in 2010 because I realized we have to do something about the deficit. I voted for him in the recall because I don’t believe recall elections are meant for what they’re doing with it,” said Katy Tomlanovich, who teaches at Northeast Wisconsin Technical College. She said recall elections should be reserved for politicians who commit gross malfeasance, not for those who make unpopular decisions.

Tomlanovich said she plans to vote for Obama in November but cast a ballot for the Republican on Tuesday. “Scott Walker is actually doing something about [spending], and I think he should be allowed to serve the rest of his term.”

Read it all.

Filed under: * Economics, PoliticsEconomyHousing/Real Estate MarketLabor/Labor Unions/Labor MarketTaxesThe Credit Freeze Crisis of Fall 2008/The Recession of 2007--The U.S. GovernmentBudgetThe National DeficitPolitics in GeneralHouse of RepresentativesOffice of the PresidentSenateState Government

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Posted June 6, 2012 at 7:15 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

...the diversity of the Washington economy is an illusion, for each of its business sectors is to some degree a creature of the region's single great industry--the federal government. According to a 2007 report by the Tax Foundation, for every dollar in taxes Washington sends to the federal government, it receives five in return. Fuller says that over the past 30 years, the federal government has spent $860 billion in the D.C. region, two-thirds of that since 9/11.

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Filed under: * Economics, PoliticsEconomyHousing/Real Estate MarketLabor/Labor Unions/Labor MarketThe U.S. GovernmentBudgetPolitics in GeneralHouse of RepresentativesOffice of the PresidentSenate

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Posted June 1, 2012 at 3:22 pm [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

A Senate panel expressed its outrage Thursday over Pakistan's conviction of a doctor who helped the United States track down Osama bin Laden, voting to cut aid to Islamabad by $33 million — $1 million for every year of the physician's 33-year sentence for high treason.

The punitive move came on top of deep reductions the Appropriations Committee already had made to President Barack Obama's budget request for Pakistan, a reflection of the growing congressional anger over its cooperation in combatting terrorism. The overall foreign aid budget for next year had slashed more than half of the proposed assistance and threatened further reductions if Islamabad failed to open overland supply routes to U.S.-led NATO forces in Afghanistan.

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Filed under: * Culture-WatchLaw & Legal Issues* Economics, PoliticsEconomyThe U.S. GovernmentBudgetForeign RelationsPolitics in GeneralSenateTerrorism* International News & CommentaryAmerica/U.S.A.AsiaPakistan

2 Comments
Posted May 24, 2012 at 4:34 pm [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

The nonpartisan Congressional Budget Office (CBO) said Tuesday that unless lawmakers act to prevent scheduled tax increases and spending cuts at the end of the year, a recession will likely result in early 2013.

Early next year income taxes are set to go up when the Bush-era tax rates expire. Automatic spending cuts totaling roughly $109 billion triggered by last August’s debt-ceiling deal are set to hit. Meanwhile, payments to physicians under Medicare will be slashed.

CBO projects that these and other elements of the so-called “fiscal cliff” will cause the economy to contract as demand dries up.

Read it all.

Filed under: * Economics, PoliticsEconomyTaxesThe U.S. GovernmentBudgetMedicareSocial SecurityThe National DeficitPolitics in GeneralHouse of RepresentativesOffice of the PresidentSenate

1 Comments
Posted May 23, 2012 at 6:50 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

Defense contractors have slowed hiring. Tax advisers are warning firms not to count on favorite breaks. And hospitals are scouring their books for ways to cut costs.

Across the U.S. economy, anxiety is rising about the potential for widespread disruptions after the November election, when a lame-duck Congress will have barely two months to resolve a grinding standoff over taxes and spending.

Read it all.

Filed under: * Economics, PoliticsEconomyConsumer/consumer spendingCorporations/Corporate LifeHousing/Real Estate MarketLabor/Labor Unions/Labor MarketPersonal FinanceTaxesThe Credit Freeze Crisis of Fall 2008/The Recession of 2007--The U.S. GovernmentBudgetThe National DeficitPolitics in GeneralHouse of RepresentativesOffice of the PresidentSenate

0 Comments
Posted May 15, 2012 at 4:52 pm [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

Government accounting for Social Security has devolved over time from deceptive to dishonest to desperate.

The latest Social Security Trustees report says that benefit promises are fully financed until 2033 and three-fourths financed after that. In short: no crisis.

Here's the truth, embedded between the lines: At the current payroll tax rate, Social Security would only bring in enough revenue to pay for 72% of all benefits through 2036.

Read it all.

Filed under: * Culture-WatchAging / the Elderly* Economics, PoliticsEconomyThe U.S. GovernmentBudgetSocial SecurityThe National DeficitPolitics in GeneralHouse of RepresentativesOffice of the PresidentSenate

1 Comments
Posted May 1, 2012 at 8:02 am [Printer Friendly] [Print w/ comments]




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