Greece on the Great Lakes

Illinois is so far in the hole.... $12 billion!

Items of note:

“Their pension is the most underfunded in the nation,” said Karen S. Krop, a senior director at Fitch Ratings. “They have not made significant cuts or raised revenues. There’s no state out there like this. They can’t grow their way out of this.” 

The state’s income tax burden is not terribly high — Illinois ranks in the bottom half of states — and its government is not terribly large. (The budgets in New York and California, per capita, are much larger). Even if the state cut out all family and human services spending, more than half of the budget deficit would remain. 

 “We are a fiscal poster child for what not to do,” said Ralph Martire of the Center for Tax and Budget Accountability, a liberal-leaning policy group in Illinois. “We make California look as if it’s run by penurious accountants who sit in rooms trying to put together an honest budget all day.”

Illinois reports that it has $62.4 billion in unfunded pension liabilities, although many experts place that liability tens of billions of dollars higher.

So what do they do? Raise retirement age and slash benefits - for future workers.

NY Times, July 2, 2010

Wonder what Michigan, Ohio and New York look like?

This cannot continue. People, agencies and businesses will be literally bankrupt because the state cannot make payroll and won't even give letters of credit so agencies can borrow against future payments (not that more borrowing is a solution). Those people, businesses and agencies will in turn default on their obligations, causing a cascade of pain that will spread to other states.

And the rest of us (states and citizens alike) will be expected to pick up the tab. Look, I don't have a problem taking care of people who are victims of circumstances. But you can't claim victimhood when you keep electing irresponsible idiots to run your affairs. You can't cannot hold these pensions as untouchable while everyone else loses their job. And you can't keep funding all the things like mental health, after-school programs, and subsidized transportation. You need to eliminate half the things you do if you are buying twice what you can afford. Given the interest due on the Illinois loans, its citizens cannot afford to cross the street right now. More borrowing is not the solution as you won't make interest payments on your loans as it is. The time for tough choices and a change in stewardship is at hand.

If everything is important, nothing is important.

Citizens must hold their elected officials to account and force them to cut up the credit cards. You cannot continue to throw up your hands and claim it wasn't you, it was someone else that brought this on. If you don't, why should the more responsible (or perhaps luckier) people in other states come to your rescue?

This is a recipe for financial disaster and in the case of Illinois, the oven timer is beeping because the goose is cooked.

This is a microcosm of the US in general. Unfunded pensions (social security), unfunded benefits (medicare and veterans) and debt obligations are looming ahead like Jaws, and will consume better than half the federal budget in the near future. Military costs look small by comparison. The taxes you pay now for benefits you think you will get in the future are really taxes for benefits that were given in the past. There is no money set aside for those future benefits and we don't even count them as liabilities in the federal budget. We long ago spent the so-called social security and medicare trust funds. We are simply borrowing more and more money that is not even planned for the government's revenue stream.  Healthcare is no different, it is another ponzi scheme that will suck the revenue out of our economy like a large leech, leaving the middle class not only without medical care, but without the infrastructure to restore privately funded services.

Is the answer to grow the economy out of this? Here's the problem with that idea: interest payments are non-productive. They do not build infrastructure, provide any services, create any industries, improve education, save for the future or pay for expenses. Think of it like money thrown in the fire. Interest payments do not build the economy. It enriches the financial industry and is used to lend more to -- whom? To the "little people," the small businesses and the local governments who will be broke because of taxes (to pay the interest).  On the other hand, if we refuse to pay the interest, then we destroy the very financial institutions that we borrowed to the hilt to save just last year. The ones we say we need so we can borrow just to survive. They provide the mortgages, car loans, even the infrastructure we use now to pay "cash" for everything from gas and groceries to cable and phone bills.

It is a vicious cycle. It destroys your standard of living, therefore quality of life. It consumes your freedoms as the government makes your choices and you can't afford any alternatives. The more you make, the more you are taxed. It makes you a slave to the bank. And now we are doing it on a national scale. So, even if you are debt free with 6 months of food in your basement, your neighbors are not, your government is not, and both will be at your doorstep to take what you have.

Stop the madness, stop the spending!

Do you need more reasons to fire Congress?

Reason 1
Besides the fact that they are not doing the job they swore to do? 
One job that Congress is constitutionally charged to perform (as there is no other entity in the government that can do it) is pass a federal government budget. The senate can't, the president can't, the office of management and budget can't, the congressional budget office can't. Only the house of representatives can do this.

For the first time in history, the House has failed to pass a budget. Even more absurd, they "deemed" a fictitious $1.12 trillion budget as passed (well beyond what the government plans to bring in - deficit). That means the government can spend money starting October 1, just like the government has been doing this year.

From Human Events
Last night, as part of a procedural vote on the emergency war supplemental bill, House Democrats attached a document that "deemed as passed" a non-existent $1.12 trillion budget. The execution of the "deeming" document allows Democrats to start spending money for Fiscal Year 2011 without the pesky constraints of a budget.

The procedural vote passed 215-210 with no Republicans voting in favor and 38 Democrats crossing the aisle to vote against deeming the faux budget resolution passed.

Never before -- since the creation of the Congressional budget process -- has the House failed to pass a budget, failed to propose a budget then deemed the non-existent budget as passed as a means to avoid a direct, recorded vote on a budget, but still allow Congress to spend taxpayer money.

Reason 2
Largest tax hikes in history
From Americans for Tax Reform
Personal income tax rates will rise.  The top income tax rate will rise from 35 to 39.6 percent (this is also the rate at which two-thirds of small business profits are taxed).  The lowest rate will rise from 10 to 15 percent.  All the rates in between will also rise.  Itemized deductions and personal exemptions will again phase out, which has the same mathematical effect as higher marginal tax rates.  The full list of marginal rate hikes is below:

- The 10% bracket rises to an expanded 15%
- The 25% bracket rises to 28%
- The 28% bracket rises to 31%
- The 33% bracket rises to 36%
- The 35% bracket rises to 39.6%

Higher taxes on marriage and family.  The “marriage penalty” (narrower tax brackets for married couples) will return from the first dollar of income.  The child tax credit will be cut in half from $1000 to $500 per child.  The standard deduction will no longer be doubled for married couples relative to the single level.  The dependent care and adoption tax credits will be cut.

The AMT will ensnare over 28 million families, up from 4 million last year.  According to the left-leaning Tax Policy Center, Congress’ failure to index the AMT will lead to an explosion of AMT taxpaying families—rising from 4 million last year to 28.5 million.  These families will have to calculate their tax burdens twice, and pay taxes at the higher level.  The AMT was created in 1969 to ensnare a handful of taxpayers.

Obama Care. There are over twenty new or higher taxes in Obamacare.  Several will first go into effect on January 1, 2011.  They include:

The “Medicine Cabinet Tax”  Thanks to Obamacare, Americans will no longer be able to use health savings account (HSA), flexible spending account (FSA), or health reimbursement (HRA) pre-tax dollars to purchase non-prescription, over-the-counter medicines (except insulin).

The “Special Needs Kids Tax”  This provision of Obamacare imposes a cap on flexible spending accounts (FSAs) of $2500 (Currently, there is no federal government limit).  There is one group of FSA owners for whom this new cap will be particularly cruel and onerous: parents of special needs children.

So how's that hope and change thing working out for YOU?
Get your Obama Tax Exemption Card here

Expert credibility in climate change, as told by expert snarks

Expert credibility in climate change
an article in the Proceedings of the National Academy of Sciences (PNAS)

Just to make sure I have this correctly:

People who study climate like to have an income.
The income comes mostly from the government.
The government "grants" income if the answer is what they want (not being scientists, facts and evidence are not an issue of consequence to politics and revenue).
If you don't have the right answer, you don't get grants (economic forcing?).
If you don't get grants, you don't get published.
Leading to fewer grants, thereby having negative feedback on "prominence," reputation and credibility.
Or you go study something else because food and shelter are good things.
Therefore, you aren't qualified to debate the matter, having failed to develop relevant expertise, like railroad engineering for example.

Do I have this right? Just checking.

Political Theater Where the Findings are Preordained

Jerry Taylor of the libertarian Cato Institute described the investigation as "an exercise in political theater where the findings are preordained by the people put on the commission."

This should not surprise anyone. A commission appointed by OB doesn't seem to have much technical expertise. Rather, it seems to have a lot of policy wonks who have already have the answers.
Like I said, those of you in Gulf states, I hope you like your commission. After all, the prez knows best.

Obama spill panel big on policy, not engineering

About energy policy: get government out of the business.

Going (way) back to my issue about having government choose the winners and losers (especially when it is apparent the motives are anything but transparent, possibly criminal, and benefit the companies who are not in energy businesses to begin with). What BO has stated for years is that the path to alternative energy and a cleaner environment is to make carbon-based energy so expensive and/or scarce that you don't have an alternative (choice) except for what the government has developed for you (with your tax dollars, but without input from the very industry it destroys).

When was the last time government developed a successful product? Atom bomb (wait, that was technically "successful," just not an allowable source of energy)? Cure for cancer? Even decoding the human genome has produced nothing life changing for the billions we spent. The moon program produced a lot of valuable engineering, but it was private industry that produced products. Take the core research and patents behind Kevin Costner's oil separation centrifuges, one he bought from the Dept. of Energy after Valdez. My point is not about the effectiveness of his product, it is that DOE and the other government agencies failed to do anything with it (or anything else) where there was a clear need, and compelling government interest. An actor and dreamer built it instead. So why do we expect the government to produce any effective carbon energy alternatives?

What started this rant? Two articles from the same blog, Master Resource.

One is an excellent explanation about effective grass roots activism that goes contrary to what we usually expect from the green side. This approach addresses how to deal with the emotional blackmail like save the polar bears. The subject in this case is wind energy. The writer is equally passionate on the subject of why not wind turbines. Grass roots strategy: go for the juggler.

The other is an article that explains just how losers become winners by applying political influence they obtain, not by being knowledgeable about energy or alternative energy, rather by using credibility from being perceived as successful doing something else. Do they have energy solutions? No, they are spouting off the same drivel we have been getting for years: more committees, more theoretical speculators -- people who have your skin in the game not theirs, and who benefit from that whole process, not from the results.  These people are always around to make sure their interests and friends are first in line at the government trough. It has nothing to do with party.

This regime is a poster child for "the ends justifies the means" (classic Alinsky), with the post-modern twist of the means is the end. In other words, keep spending your tax dollars and never get anywhere, just drive around for a few decades. Let the good times roll on. And if having committees who borrow the credibility of scientists to promote their political agenda doesn't scare you, you haven't read my post here.

What are the priorities again?

Make BP pay.
Have the government give people BPs money.
Make BP capture the oil in a few weeks.
Watch what amounts to 10,000 people per state pick up tar balls.
Make BP pay.
Stop drilling.
Have BP give money to people that the government layed off by putting a moratorium on offshore drilling for 6 months (huh?!?).
Have people study the accident.
Have people study the gulf coast other crises and problems (hey Gulf Coast, hope you enjoy DC studying you and deciding what you need, like they did with Katrina).
Reorganize minerals management - whip those slackers into shape (butts to kick).
More regulations, standards and enforcement.
End our oil addiction (because we have run out of safe places to drill?!? NOT)
Embrace clean energy (go ahead, give it a big hug and a kiss).
Spend another $80 billion we don't have. Tax oil so we can pay for more unemployment benefits and medicare and tax benefits and...
Legislate more efficient buildings, make power companies use solar and wind (which not only costs more but is less efficient and has a bigger carbon footprint) and conduct R&D (if you know carbon or hydraulic operations, how are you qualified to do something unknown? It's like having your drug store perform cancer research.)
Pray for courage.

Yup, just read that over and I don't see anything about plugging the damn hole. Or saving the wildlife and wetlands. Or protecting the coasts. Or get the oil out of the water. Nope, don't see any of that.

This presidency: Reasons why what seemed like a great idea isn't working

An interesting article in American Thinker. HT to Doug
Selected text from the article:

How could a new president riding in on a wave of unprecedented promise and goodwill have forfeited his tenure and become a lame duck in six months? His poll ratings are in free fall. In generic balloting, the Republicans have now seized a five point advantage. This truly is unbelievable. What's going on?

No narrative. Obama doesn't have a narrative. No, not a narrative about himself. He has a self-narrative, much of it fabricated, cleverly disguised or written by someone else. But this self-narrative is isolated and doesn't connect with us.  He doesn't have an American narrative that draws upon the rest of us. All successful presidents have a narrative about the American character that intersects with their own where they display a command of history and reveal an authenticity at the core of their personality that resonates in a positive endearing way with the majority of Americans.

Dorothy Rabinowitz in the Wall Street Journal points out: He is failing because he has no understanding of the American people, and may indeed loathe them.

... he's dissed just about every one of us--financiers, energy producers, banks, insurance executives, police officers, doctors, nurses, hospital administrators, post office workers, and anybody else who has a non-green job.

If this much intrigues you, please click over to AT and read the rest.