Ominous omnibus

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The level of tone-deafness in DC has hit an all-time high. After an absolute thrashing of establishment politicians on both sides of the aisle, those good ole boys (and gals) decided to give the American people a giant middle finger on their way out of town.

They just introduced a ginormous spending bill. $1.1 trillion in discretionary spending, almost 6700 earmarks, to the tune of $8 billion and oh yeah – toss in another billion for Obamacare that doesn’t even go into effect until 2014. Unbelievable.

Soon-to-be-former Senator Bob Bennett remains defiant to the end, adding hundreds of earmarks that add up to over a billion dollars, then telling The Hill:

“That’s my intention,” said retiring Sen. Bob Bennett (R-Utah) when asked if he would support the package.
 
Bennett said earmarks in the bill might give some of his GOP colleagues reason to hesitate but wouldn’t affect his vote.
 
“It will be tough for some, but not for me,” he said.

Meanwhile, Utah’s Senator Hatch has pulled the visible earmark requests under his name and removed them from his website. His donors have no reason to fear, though – Senator Bennett is sponsoring those very earmark requests.

Additionally, he still has hidden goodies, according to Nacilbupera:

Hatch proposed a $1M bailout earmark for helping with the UTOPIA buildout for Perry City and Tremonton in a $132B appropriations bill which had yet to be voted on: S. 3606.

The proposed $1.1T Omnibus takes S. 3606 and adopts it in full or modified form (so sorry, like anybody else in Congress I haven’t had time to read it all) and combines it with the other pending appropriation bills Congress has failed to address. If you compare p. 55 of S. 3606 which authorizes the money to p. 63 of the Omnibus, they read exactly the same: both grant the continuation of the $18M in grant money (the grant money was separately earmarked on p. 76 of Senate report 111-221).

Some of the Christmas goodies include the following list from Senator John McCain (who, it appears, can be taught)

#10. Is a tie – $300,000 for the Iowa Orchestra & $106,000 for the Utah Symphony

#9. $1,500,000 for New England Multi-Species Surveys and Development in New Bedford, MA

#8. $300,000 for Groundfish research in Augusta, ME

#7 $500,000 for highly migratory shark fishery research program in San Jose, CA

#6. $2,500,000 for the Imiloa Astronomy Center in Honolulu, HI

#5. $425,000 to restore the Booneville Hardware Building in Booneville, MS – population 8,360!!

#4. $1 million to re-introduce upper floor housing in Des Moines, IA – what about the lower floor housing?

#3. $3 million for Chesapeake Bay Oyster restoration in Maryland.

#2. $500,000 for Blue Fin Tuna tagging and research in California

#1. $10,000,000 to the John P. Murtha Foundation – nuff said…

Only in government do people who are fired get two months free reign AND control of the checkbook. The first politician to introduce a no-lame-duck-session bill – and get it passed – will become an instant national hero.

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18 Responses to “Ominous omnibus”

  1. theSTARforum Says:

    I am so sick of this. This is totally because of the “good and plenty” clause. (Just kidding.)

  2. rmwarnick Says:

    Don’t forget that Senate Minority Leader McConnell and President Obama have proposed $900 billion in budget-busting tax cuts for the rich. The estate tax break alone costs $115 billion. The federal government has to borrow 40 cents of every dollar, because taxes are not high enough to pay for programs.

  3. John Says:

    Wasn’t there a multi-million-dollar earmark for a Ted Kennedy memorial in there? Surprised that didn’t make the top ten.

  4. Cherilyn Eagar Says:

    It should be no surprise that Senator Bennett would want to bail out Utopia cities. He sat on the Transatlantic Policy Network and is a One Worlder.

    The history of ObamaCare (as an example of an isolated issue) shows that both he and Hatch, along with other Republicans have always supported national health care, earmarks, big spending and the sell-out of American sovereignty. Whether through amnesty, central banking or free trade policies, Republicans are as much to blame for the disaster America is facing as a sovereign, free nation as are Democrats.

    Follow the money and watch closely what the people we elected do. Hold every single one of them in check – even the “rock stars.” The Pledge to America has some good principles in it, but it neglects the cause of our economic problems: one worlders on both sides of the aisle who support a world monetary system.

    Some people read Harry Potter. I read Foreign Relations. Do the research and you will find by going to original sources that all policy is generated from the United Nations. It is folly to believe that the world can be run by a consortium of unelected bureaucrats, which is the defintion of the U.N. The busy-bodies representing 3,500 NGOs who attend 7,000 meetings a year are running Congress which is run by all the federal agencies of the unelected.

    Have you ever wondered why every Utopia plan across this nation supported the League of Cities (League of Nations??? figure it out, my friends) comes up with the very same proposals of “sustainability” and environmental policies?

    Have you ever wondered why all the “stakeholders” gathered on these local committees – including the Health Care Task Force in Utah – include everyone BUT the most important stakeholders – the patients and the independent doctors?

    Where was Dan Liljenquist in the Health Care Task Force hearing when all these agencies reported on all their “great work” using hundreds of millions in federal grants? Chris Buttars had the guts to tell it like it was “Why are we having this discussion?” he said.

    Where was Dave Clark? “We can’t move fast enough” he said. Utah is instituting Obamacare-Lite through the “exchange” system with the monopoly of our glorified HMO called IHC orchestrates their position as gatekeeper. The exchange was the Wyden-Bennett plan. And our Utah legislators are doing it while we sing their praises? Local politics is not much different from national politics.

    Watch how lobbyists are used. Lobbyists run Washington DC for two prime reasons:
    1. To protect their businesses from government intrusion (a good reason). If the federal government was minding its own business, the need for them would dry up and go away.
    2. To use government to protect their business from competition (a bad reason). If government would stop being the nanny to businesses would don’t have the courage to buck up and take responsibility for their own failures, restructure and figure out how to compete on their own, they would disappear as well.

    It all boils down to elected leaders assuming more power than they ought to have and our allowing them to do it. At the end of the day, the American citizen must take responsibility and be sure they are standing behind candidates that can be trusted to do the right thing at all costs. We must be eternally vigilant in the cause of liberty.

  5. Pops Says:

    …taxes are not high enough to pay for programs.

    So cut the programs. That’s what every private citizen and business has to do. Taxes are already too high.

  6. rmwarnick Says:

    What programs do you want to cut, Pops, and how many hundreds of billions can you save by cutting them? Thanks to the Republican filibuster of the omnibus spending bill, we’re already headed for a government shutdown at the end of March next year.

  7. Ronald D. Hunt Says:

    And remember Pops you have to target programs that draw from the general budget.

    Social security by law doesn’t create deficits because when the trust fund runs out it will automatically lower the paid out benefits to whatever can be covered by the incoming payroll taxes(about 78% of benefits) and not a dime comes out of the general fund.

  8. Pops Says:

    You really don’t get the Social Security trick, do you? It goes like this: government securities held by the government have no value. Repeat it until you get it.

    Let’s put it another way. Let’s say I want to get a big loan but I have no collateral. So I sell myself shares of myself until the face value of the shares is equal to the collateral I need. Of course, I spend the money I used to “buy” the shares. I take my certificates down to the bank and apply for the loan. When they ask about collateral, I show them the certificates. The bank’s next move is either a) throw me out, or b) throw me out and call the cops.

    Social Security is paying out more than it takes in TODAY. Kill it before it kills us.

  9. Ronald D. Hunt Says:

    “It goes like this: government securities held by the government have no value.”

    The holder is not relevant, be it social security, China, American banks, or individual investors all government debt must be paid back to its holders. The governments general fund borrowed from the social security fund under the terms and conditions set in a T-bill, just like China, American banks, or individual investors who bought T-bills.

    “So I sell myself shares of myself until the face value of the shares is equal to the collateral I need. “

    Yes you can setup all kinds of farcical examples to try and construe the government as being a single monolithic entity, rather then a collection of agencies some funded via general tax revenue and some funded via their own revenue source such as Social Security.

    Social security collected real and factual money from the American people and put that money into T-bills effectively loaning it to the government general fund. The government general fund used that money and is now required to pay back that money under the conditions defined in the T-bills. And this is debt that occurred outside of anything doto with the social security program, this debt would still be their with or without social security, The only difference would be the holder.

    “Social Security is paying out more than it takes in TODAY. Kill it before it kills us.”

    Good thing for that $2.5 trillion dollars in the trust fund, and again Social security will never cause a deficit by law when the trust fund runs out Social security will automatically start paying lower benefits matching that of incoming tax revenue to the program.

    And again to the original question rmwarnick asked,

    “What programs do you want to cut, Pops, and how many hundreds of billions can you save by cutting them? Thanks to the Republican filibuster of the omnibus spending bill, we’re already headed for a government shutdown at the end of March next year.”

  10. Pops Says:

    Social Security collected real and factual money from the American people and spent it. The T-bills in the “trust fund” have no value.

    If there was no trust fund, how would the government pay benefits above and beyond current receipts? By borrowing, printing money, or raising taxes in the amount of the deficit.

    Given that there is a “trust fund”, how will the government redeem bonds in the trust fund to pay benefits above and beyond current receipts? By borrowing, printing money, or raising taxes in precisely the same amount as they would were there no trust fund.

    The trust fund has zero value.

  11. Ronald D. Hunt Says:

    Given that there is a China’s holdings, how will the government redeem bonds in the China’s holdings to pay benefits above and beyond current receipts? By borrowing, printing money, or raising taxes in precisely the same amount as they would were there no China’s holdings.

    The China’s holdings has zero value.

    Again their is no difference between social security and any other holder of government debt. We will have to find the revenue to pay back all of the governments debts to all debt holders sooner or later.

    Social security is very much able to redeem these T-bills on the terms under which they where issued, meaning that just like any other debt holder when the term of the bond is up they will have to paid the bond value, or at the bond holders option roll the bond into a new bond, or pay the bond holder and roll the debt to a new bond to a new bond holder.

    And again to the original question rmwarnick asked,

    “What programs do you want to cut, Pops, and how many hundreds of billions can you save by cutting them? Thanks to the Republican filibuster of the omnibus spending bill, we’re already headed for a government shutdown at the end of March next year.”

  12. Pops Says:

    Your China’s holdings example is correct, but somehow you missed your own point. The bonds held by China are a Chinese asset and a US liability. They’re definitely not an asset on our balance sheet.

    If the SSA had purchased shares of GM (or China) and put them in the trust fund, the redemption of those shares would not incur debt. The trust fund would have been an asset rather than a liability. Of course they didn’t want to do that because they wouldn’t have been able to spend the money for other stuff – they would have had to spend the money on the shares. Instead, they printed certificates.

  13. Ronald D. Hunt Says:

    “The bonds held by Social securityare a Social security asset and a General fund liability.”

    Their fixed it for yea.

    “If the SSA had purchased shares of GM (or China) and put them in the trust fund,”

    shares of stock are as much a liability as any other bet. After the 2007-8 crash 401k’s lost $18,000,000,000,000 that is eight teen Trillion dollars, or basically almost double 2075 projected shortfall in social security(which isn’t a deficit causing shortfall its a benefits short fall of about 22% as per design of the SS law).

    Social security is a bet that the US economy will continue growing as a whole and that tax revenue will grow or be enough to pay back the T-bills, this is a good bet btw. I should mention that even moderate amounts of wage growth above the flat line we have had sense Reagan will fill the SS shortfall as well.

    “they would have had to spend the money on the shares.

    We all saw what happened to shares in companies after 2007-8, buying little bits of companies(stock), is bets against slim slices of the economy, a bet that a particular industry and further a particular entity within a particular industry will do well. The understanding necessary to do this is well beyond Phd level, especially when you consider how the private market has created so many different ways to bet on the outcomes of slim slices of market activity, hell currently their is more economic activity related to betting on the outcomes of economic activity then their is on real factual growth from building things.

    Retirement “investment” savings is a terrible model for well over 90% of Americans, because nobody can predict the market outcomes of slim slices of the economy. And even in the case where the Retirement investment is a insurance fund its subject to the same problems with investment outcomes, look California’s retirement fund for example they had well over $100 billion dollars of AAA rated securities evaporate on them in 2007-8. btw Cali got rid of the 2/3 vote requirement to pass a budget in 2010 election, so in addition to state single payer their is a good chance they will start a state bank which will effectively turn their $600 billion dollar pension fund into part of a state sovereign wealth fund and save them $16 billion or so a year in banking fee’s or almost all of their budget shortfall without more cuts.

    And again to the original question rmwarnick asked,

    “What programs do you want to cut, Pops, and how many hundreds of billions can you save by cutting them? Thanks to the Republican filibuster of the omnibus spending bill, we’re already headed for a government shutdown at the end of March next year.”

  14. Pops Says:

    The bonds held by Social Security are a Social Security asset and a general fund liability.

    Well, that clears it up. It’s the Enron model in reverse – the wholly-owned subsidiary carries the pretend asset, while the owner carries the actual debt.

    …shares of stock are as much a liability as any other bet…

    Yeah, that’s why I have to list my 401(k) as debt. Not. Assume the SSA bought gold – they could then sell it to pay benefits. But I suppose you’ll say gold is a liability as well.

    The real problem is that any market the US government starts pouring money into is going to be distorted beyond belief. It’s better if they leave it alone and let people save for their own retirements. I would certainly have been better off – I could could have retired before now.

    Social security is a bet that the US economy will continue growing as a whole and that tax revenue will grow or be enough to pay back the T-bills

    Well, no, not really. It’s a Ponzi scheme, where the most-recent “investors” pay the early “investors”. It’s a bet that the demographics will support it, but the demographics are backwards so it’s a losing bet.

    And it really isn’t raising enough revenue to pay back the T-bills. It’s raising the money over again that was spent instead of saved.

  15. Ronald D. Hunt Says:

    “Yeah, that’s why I have to list my 401(k) as debt. Not. “

    You misunderstand, any holding of a variable value subject to risk is not truly an asset, its a liability until you cash out. Be it stocks, bonds, or gold.

    “Assume the SSA bought gold – they could then sell it to pay benefits. But I suppose you’ll say gold is a liability as well.”

    I can only image how much fun market speculators could have with that model of investment. Gold has a wildly inflated value currently, its very possible that give the 3-4 multiples of paper gold to total amounts of real gold(IE: derivatives based on speculation about the future price of gold) that your soft metal favorite will be at the center of the next economic downturn, likely next year when deflation starts to become a problem and the value of gold stops growing so fast likely leading to a sell off and crash of its value.

    No one can predict the future quality of any particular industry or commodity, which is one of the reasons social security works so well, its a bet that the economy as a whole will continue to grow and work.

    “It’s better if they leave it alone and let people save for their own retirements.”

    The numbers don’t favor your model of retirement savings, well over 80% of people need a retirement insurance plan not a retirement savings account.

    Nobody knows the exact age they are going to kick the bucket so the range of value required is unknown, The savings required can be anywhere from $0(die before retirement) to $1.2 million dollars(live to 100years of age assuming $40,000 working yearly income before retirement and living on 80% of that wage after retirement with no adjustments for increase in the cost of living).

    Now we can use lots of different return rate models, and different ways to account for eventual economic crashes, But the flat fact of the situation is that few people can afford to save 1/3 of their income throughout their entire working life to retire in their 60’s, and even if you did save a few hundred thousand dollars and managed to not loose any of it during periods of economic downturns, that money won’t last you through your retirement if you manage to live 8-9 years past retirement.

    Now give me a set of 300,000,000 people along with the last 100 years of statistics related to death rates/ age of death / life expectancy etc, And I model an insurance plan that can cover that will cover retirement for that set of 300,000,000 people and I can very easily project what it will cost. In fact with a set of data that large I can project the costs close enough to match monthly revenue to monthly payouts, and I can use a trust fund to even out periods between when their is a spike of retiree’s greater then long term slope.

    “And it really isn’t raising enough revenue to pay back the T-bills.”

    Social security doesn’t have to raise the funds to pay back the T-bills, that is the debtors problem aka the general fund needs to pay back social security not social security.

    “It’s raising the money over again that was spent instead of saved.”

    It was saved in T-bills, See the government in the current frame of time can use the funds to invest into infrastructure and defense of the nation which in turn leads to higher tax revenue later down the road with in which to pay the T-bills, pretty good setup actually. Of course republicans sense Reagan have used the additional income for the worst economic growth tool available tax cuts for upper brackets, but that is easily enough fixed, and the fact that abeit this year Social security payed more out then it brought in, in taxes it is still projected to have a surplus for another 15 years and for the trust fund to last another 27 after that.

    As it is, the government can’t just sit on the cash, money looses value over time, so the T-bills are the best approach. However If we had currency reform it would be possible to design an alternative SS trust fund savings method where just sitting on it would be an acceptable outcome.

  16. Pops Says:

    Look, you need to brush up on your accounting. Stocks, bonds, and gold can never be a liability, even if their value goes to zero. A liability has negative value – not zero value, not positive value. You also don’t seem to understand what was wrong with Enron’s accounting practices, why Arthur Anderson no long exists, and how the government’s accounting methods for the Social Security trust fund are the same as Enron’s.

    The numbers don’t favor your model of retirement savings…

    The numbers don’t favor Social Security. It’s the demographics, remember? When I run the numbers on the money I’ve contributed to Social Security over my lifetime, using actual market performance. I’m a wealthy retiree. Social Security made sure that didn’t happen, didn’t it?

    As it is, the government can’t just sit on the cash, money looses value over time…

    The reason money loses value over time is because government inflates the money supply.

    …so the T-bills are the best approach.

    No, it’s the dishonest approach. They spent the money and printed some certificates. Whoop-de-doo. Check out how well that worked for Ken Lay.

  17. Ronald D. Hunt Says:

    “Look, you need to brush up on your accounting. Stocks, bonds, and gold can never be a liability,”

    Their outcomes are uncertain so their a liability, you can invest $100 today and have $50 tomorrow, or zero.

    “You also don’t seem to understand what was wrong with Enron’s accounting practices,”

    No I understand very well the difference, SS is social insurance for retirement, and Enron is an investor fraud scam.

    “It’s the demographics, remember?”

    After 2037 when the trust fund is empty Social security can still pay 78% of benefits, And this assumes that wages flatline the entire time. even small increases in wages push this up so every 5-10 years then seem to add 5-10 years to the figure they quote for the fund running out, Social security is doing just fine. Hell wish I could double my investment in social security, I hate being forced to invest in the corrupt cobal known as well street(even know i am pretty good at it).

    “The reason money loses value over time is because government inflates the money supply.”

    This happened for 2 reasons, one being that constant manipulation in the gold market had lead to extreme changes in the value of the dollar prior to ending the gold standard, and the big thing that killed it globalization. We where getting clobbered by nations willing to engage in rampant currency manipulation after they ended the gold standard in their respective nations.

    We do need currency reform, I believe i have suggested a 2 tier system that replaces the fractional reserve system with a fractional currency system before.

    “They spent the money and printed some certificates. “

    So the Eisenhower Hiway system lead to no economic growth what so ever? So even as badly designed as they where the Reagan tax cuts funded by SS created no economic growth what so ever?

    You gotta spend money to make money!

  18. Pops Says:

    Their outcomes are uncertain so their a liability…

    You’re confusing risk with liability. (Communication is really hard when wrong terms are used.)

    SS is social insurance for retirement, and Enron is an investor fraud scam.

    If you ran a private insurance company the way SS is run, you would enjoy the same fate as Ken Lay.

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