July 26, 2011

Major Holders of U.S. Debt

Major Holders of the United States Debt

Congress in the Lead - NYTimes.com

Do we have a failure of leadership and a triumph of politics in Washington at this critical hour? Did Congress really wrestle control of the the debt crisis from a petulant TeamObama as David Brooks suggests? Of course, over-spending has always been Congress' problem because they have the nation's spending reins under our Constitution.

[Chart from the Wall Street Journal 07/26/11]

Alas, the dream of a Grand Bargain died Friday evening for three reasons.
First, it was always going to be difficult to round up the necessary Congressional votes. Republicans didn’t want the tax increases. Democrats didn’t want the entitlement cuts.
Second, the White House negotiating process was inadequate. Neither the president nor the House speaker ever wrote down and released their negotiating positions. Everything was mysterious, shifting and slippery. One day the president was agreeing to an $800 billion revenue increase; the next day he was asking for $400 billion more. Spending cuts that seemed to be part of the package suddenly seemed hollow. Negotiating partners disappeared.It was phenomenally hard to figure out exactly who was offering what. Democrats in Congress were kept in the dark and were understandably suspicious. It was all a recipe for misunderstandings, hurt feelings and collapse.
Third, the president lost his cool. Obama never should have gone in front of the cameras just minutes after the talks faltered Friday evening. His appearance was suffused with that “I’m the only mature person in Washington” condescension that drives everybody else crazy. Obama lectured the leaders of the House and Senate in the sort of patronizing tone that a junior high principal might use with immature delinquents. He talked about unreturned phone calls and being left at the altar, personalizing the issue like a spurned prom date.
Obama’s Friday appearance had a gigantic unintended consequence. It brought members of Congress together. They decided to take control. The White House is now on the sidelines. Democratic and Republican Congressional leaders are negotiating directly with one another.

July 18, 2011

The True Debt Deficit Problem

Killing the Golden Goose

The U.S. deficit and debt problem in a nutshell. Those politicians and lobbyists advocating no entitlement reform will ruin our future. Will the true national leaders please stand up and defend our future?

(Hat tip to Steven Hansen at Seeking Alpha for the graphic.)

July 8, 2011, Cheryl Hanna: Vermont likely to foot legal bill no matter who wins | Vermont Yankee Lawsuit: Commentary

An easy-to-read legal examination of the Vermont Legislature's passage of Act 47 in the last session which "gives Vermont the authority to bill back costs associated with litigation in state or federal courts that involve an entity holding a certificate of public good."

Professor Hanna concludes: "It is my humble yet considered judgment that not only is the law unenforceable, but it is also likely unconstitutional."

Sadly, the Legislature in recent years has saddled Vermont with substantial legal fees as the Attorney General continues to lose cases at the Supreme Court. Vermonters should be alarmed that the Legislature has a penchant for passing unconstitutional laws.

I fault Legislative leadership for this sorry state of affairs. Now, one of those leaders is Vermont's Governor. When will they ever learn?

July 17, 2011

Governors See State Woes Regardless of How Debt Crisis Ends - NYTimes.com

All this wailing from the Governors is one more indication that government spending at all levels has exceeded the nation's ability to pay for it.

Meanwhile politicians of both parties are trying for political advantage when they should be seriously tackling the problem...too much spending. It's beyond time that elected officials act like statesmen rather than politicians angling for an advantage in the next election.

"Gov. Haley Barbour of Mississippi, a Republican, said that a default stemming from a failure to increase the borrowing limit would be “terrible” for states. But he said that states must also brace themselves for managing a new set of cuts even if the limit is raised. “No matter what happens, states are going to get less money from the federal government,” he said."

July 13, 2011

The Start-Up of You - NYTimes.com

The Start-Up of You - NYTimes.com:

Friedman has it right. Businesses aren't stupid. They have reexamined their operations during the recession and found ways to reduce costs, chief among them fewer employees.

We should expect no less from the private sector in a (relatively) free economy? Profitable businesses will always innovate to increase productivity.

Employees must similarly find within the capacity to reinvent themselves rather than become dependent on the government to take care of them. The last decade has shown that the country cannot afford that approach.

Now, if we could just get that attitude instilled in our political leadership!

"Indeed, what is most striking when you talk to employers today is how many of them have used the pressure of the recession to become even more productive by deploying more automation technologies, software, outsourcing, robotics — anything they can use to make better products with reduced head count and health care and pension liabilities. That is not going to change. And while many of them are hiring, they are increasingly picky. They are all looking for the same kind of people — people who not only have the critical thinking skills to do the value-adding jobs that technology can’t, but also people who can invent, adapt and reinvent their jobs every day, in a market that changes faster than ever."