The US Budget Explained in Simple English

Editor's Note:  Keep in mind that the call to "balance the budget" is about implementing budget cuts that usually have the greatest impact on the most vulnerable in our Society.  Remember when Bill Clinton "balanced the budget"...it was done on the backs of the poor.  I suggest that we balance the budget on the backs of the international banking elites before we get rid of the the social safety net.  Abolish the "income tax" which was never ratified by Congress, thus illegal, and instituted to fund the criminal activities of the Federal Reserve Private Banking Institution.

Slightly outdated numbers which have only gotten worse, but still relevant.

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US Senate blocks bill targeting oil firm subsidies

© AFP/Getty Images/File David Paul Morris

AFP

WASHINGTON (AFP) - The US Senate defeated a bill taking aim at some $2 billion in annual subsidies to some of the world's largest and most profitable oil companies amid deep voter anger at high gasoline prices.

Lawmakers voted 52-48 to end debate on the measure, falling short of the 60 required and effectively killing a proposal that the White House's Democratic allies had portrayed as a belt-tightening step in cash-strapped Washington.

Democrats planned to revive the proposal -- which would have affected oil giants BP America, Chevron, ConocoPhillips, ExxonMobil and Shell -- as part of broader spending-cut talks ahead of a vote on raising the US debt ceiling.

Obama warns on debt ceiling risk

© AFP/File Brendan Smialowski

AFP

WASHINGTON (AFP) - President Barack Obama warned the United States risked plunging back into recession if a standoff over the US debt ceiling lingers, as a top Republican said he was ready to cut a deal.

The United States is due to hit the $14.29-trillion ceiling set by Congress on Monday, creating a cash crunch that puts the country's credit standing at risk as politicians battle over its long-term deficit.

"If investors around the world thought that the full faith and credit of the United States was not being backed up, if they thought that we might renege on our IOUs, it could unravel the entire financial system," Obama warned at a CBS town hall meeting last week that was broadcast on Sunday.

Money-hungry US to hit borrowing cap

© AFP/File Shawn Thew

AFP

WASHINGTON (AFP) - The debt-laden US government's credit card will hit its limit Monday, creating a cash crunch that puts the country's credit standing at risk as politicians battle over its long-term deficit.

Reaching the $14.29 trillion ceiling set by Congress will not have an immediate impact on government finances, because the Treasury has found about ten weeks of wiggle-room in short-term adjustments and an unexpected April jump in tax revenues.

But with Republicans refusing to increase the ceiling without massive future spending cuts, the longer the fight over bridging the country's deficit goes on, the higher the stakes will get.

If nothing is done by about August 2, there is a chance the United States, which has always merited a top-grade credit rating, could do the unthinkable -- default on its debt payments.

Social Security, Medicare burning through funds

A health care activist
© AFP/Getty Images/File Chris Hondros

AFP

WASHINGTON (AFP) - The United States is burning through its health care and retirement fund pools faster than planned, with the Medicare trust fund to be exhausted by 2024, five years earlier than expected, officials said Friday.

A combination of higher costs and lower-than-expected revenues has worsened the outlook for Medicare as well as for Social Security, which will use up its huge trust fund in 2036, one year earlier than was projected last year, plan trustees said in their annual reports.

They emphasized that the forecasts point to dates when the level of payouts to beneficiaries to match incoming funds -- mostly payroll deductions and investment earnings -- will have to be reduced.

Medicare, which offers health care to retired and disabled Americans, would only be able to offset 90 percent of the costs of care, while Social Security would pay out only 75 percent of scheduled benefits, after the respective dates.

The Medicare report stressed that the program had gained a "sizable improvement" in its financial outlook due to the controversial Affordable Care Act of the administration of President Barack Obama.

Obama's Deficit Plan will Impoverish Main Street America

Global Research-President Obama announced the outlines of his deficit plan, leaving a lot up for negotiation. He planted his poll at the center right and where he ends up, with his history of compromising to bring right wing Republicans and Democratic corporatists together, can only be worse.


I was pleasantly surprised to see groups that usually side with Obama even criticizing him.  True Majority/US Action wrote “Obama wants to cut $4 trillion, but not $1 from the Pentagon,” in their headline.  They go on to point out that “President Obama today proposed reducing the deficit through almost $800 billion in cuts.”  They correctly point out that the country needs jobs not deficit cuts, and if cuts are going to be made they should not be made in domestic programs where funds are needed but in the military writing: “Over half of the money Congress makes decisions on goes directly into the Pentagon’s pocket, and that doesn't count the money for actual wars. But instead of cutting the Pentagon budget, Obama is proposing over $700 billion in cuts to programs that benefit the poor, seniors and children, while only trying to save $400 billion on war and weapons.”

Republicans will make US a 'Third World' country: Obama

© AFP/Getty Images Scott Olson

AFP

CHICAGO (AFP) - US President Barack Obama accused his Republican foes of wanting to turn the United States into a "Third World" country Thursday as he rallied support for his reelection campaign.

The attack came a day after Obama savaged Republican budget plans and unveiled his $4 trillion deficit reduction drive that aims to raise taxes on the wealthiest Americans in order to preserve key social services.

The debate over fiscal policy will prove critical to the 2012 campaign, and Obama sought to frame it as a "stark choice" between investing in the future or watching the country fall apart.

Get Ready for Federal Budget Gridlock

Greg Hunter
USA Watchdog

This week, President Obama gave a speech outlining his plan for long term deficit reduction.  He invited the Republican leadership for what many thought would be some sort of bi-partisan federal budget 2011 solution.  In reality, it was kind of a St. Valentine’s Day massacre because right off the bat, Mr. Obama pulled out the Presidential tommy-gun and started shooting. He said, “This debate over budgets and deficits is about more than just numbers on a page, more than just cutting and spending.  It’s about the kind of future we want.  It’s about the kind of country we believe in.” 

Surprise, surprise.  The kind of country President Obama “believes in” is a lot different than the Republicans.  The President said the Republican plan “ends Medicare as we know it.” Sounds to me the President will play the class warfare card during the 2012 election season because he went on to say, “The top 1% saw their income rise by an average of more than a quarter of a million dollars each.  And that’s who needs to pay less taxes?”  (Click here to read the entire text of the President’s deficit speech.) I can see why the President is playing to lower income people.  Recently, a poll revealed a majority of the poorest Americans no longer support Obama.  CNSNews.com reports, “President Barack Obama’s approval among the poorest Americans dropped to an all-time low of 48 percent last week, according to the Gallup poll, leaving the president with less-than-majority approval among all income brackets reported in Gallup’s presidential approval surveys.” (Click here to read the complete CNSNews.com story.)

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Playing the Lyre of Budget Madness as the Empire Burns

image - BATR

SARTRE, Contributing Writer

Activist Post

By Washington DC standards the just concluded budget agreement for funding the federal government through September, is a big win for Republicans. Emily Miller in Human Events describes, "The final agreement will be for $38.5 billion in cuts from current spending over the remaining six months of the current fiscal year, which ends on Sept. 30. The spending cuts, although historic in size, account for only 2.5% of this year's projected budget deficit of $1.6 trillion." Here lies the obscenity of the central government; namely, that a mere drop in the bucket reduction in a historic deficit is lauded as the great achievement of compromised negotiations. 

Viewing the inside partisan game and keeping score between two branches of the same corrupt party system guarantees habitual surrender to the curse of public debt. How can any far-sighted and judicious person accept that victory is defined as curbing the speed of an out of control train rushing to cross a trestle with rotten support timbers as a flood washes away the foundation of the structure? In today’s twilight zone of self-delusion, the mainstream media and political apologists pontificate that the ship of state was saved from crashing upon the reef of sunken vessels. 

REALLY !!!

Debt Jumped $54.1 Billion in 8 Days Preceding Obama-Boehner Deal to Cut $38.5 Billion for Rest of Year

wiki

Terrence P. Jeffrey 
CNS News

The federal debt increased $54.1 billion in the eight days preceding the deal made by President Barack Obama, Senate Majority Leader Harry Reid (D.-Nev.) and House Speaker John Boehner (R.-Ohio) to cut $38.5 billion in federal spending for the remainder of fiscal year 2011, which runs through September.

The debt was $14.2101 trillion on March 30, according to the Bureau of the Public Debt, and $14.2642 on April 7.

Since the beginning of the fiscal year on Oct. 1, 2010, the national debt has increase by $653.4 billion.

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US to reach debt limit by May 16: Treasury

"Default would cause a financial crisis potentially more severe than the crisis from which we are only now starting to recover," Geithner said. He warned that military pay, social assistance payments and tax refunds could be among the first things to be blocked.

US Treasury Department said US likely to hit
$14.29 trln debt limit sooner than thought
© AFP/File Karen Bleier

AFP

WASHINGTON (AFP) - The United States is likely to hit its $14.29 trillion debt limit sooner than thought, the Treasury Department said Monday, pressuring lawmakers to raise the ceiling or face a possible government default.

"The Treasury Department now projects that the debt limit will be reached no later than May 16, 2011," the Treasury said.

The department previously estimated it would hit the ceiling by May 31.

If it is not raised, the United States would only have weeks before it runs out of cash to pay its bills, according to government estimates.

Cronyism and Dictatorship in Michigan (Video)

Activist Post 

In this clip, Rachel Maddow naturally uses left-right political labeling to explain the situation.  Beyond this, however, the situation in Michigan is truly as alarming as she states.  The cronyism is on full display as Governor Rick Snyder will raise taxes on the backs of seniors and the poor by eliminating tax breaks, as well as income tax deductions for such things as donations to public universities. The $1.7 billion that is projected to be saved will immediately be given over to corporations as a $1.8 billion tax break, resulting in a less-than-zero benefit to the state of Michigan.

Even worse, in the case of "financial emergency" (which Snyder himself can create by cutting funding to cities and towns) the Governor becomes a de facto dictator of the state with the power to unilaterally choose his own local governments by employing financial overseers to determine fiscal health, then offer the remedy.  It would be a perfect microcosm of Problem-Reaction-Solution except for the fact that there will be no need for even a reaction; it's just straight from problem to solution with the Governor of Michigan as the creator of both -- the essence of a dictatorial policy.

Maddow correctly calls this out for what it is: using a "crisis" to push an agenda that would never be accepted without the declaration of a crisis situation. 

Predictably, the protests have begun, but they need to become a lot more vocal, or it won't only be a eulogy for unions being given; it will be a eulogy for the state of Michigan.



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Engineered Economic Collapse Approaching; Budget Cuts Will Only Accelerate the Inevitable

Eric Blair
Activist Post

Ron Paul constantly reminds us that money is created out of thin air, which is to say it's an illusion. Therefore, the debt must be an illusion too, correct? Yet, fiscal conservatives still use the debt as a tool of fear to make budget cuts that they selectively deem expendable.

Sure, they may think these cuts make them look "responsible," but ultimately it is still collectivism -- just more on their terms.  Make no mistake; budget cuts in our corrupt systems are just another form of wealth redistribution. After all, that money is being eliminated to pay off the debt, right? Thus, that money is removed from programs that employ people to pay off the issuers of credit (banks).

Additionally, the costs of the national debt, bank bailouts, war costs, and unfunded liabilities are fundamentally impossible to pay off.  So, the notion that cutting a "historical" $100 billion will have any positive affect on the long-term economy is absolute fiction.  And although many conservative lawmakers feel like it's the right thing to do, they know it will have no measurable affect on the debt. It's a scam, and if the history of modern lawmaking is any indicator, the establishment will surely stick it to the poor and middle classes with these cuts while the oligarchs continue to flourish.


Don't get me wrong; I am in full agreement with the philosophy of less government across the board. The fact that taxpayer funded subsidies, earmarks, foreign aid, and most domestic spending warps the free market is undeniable. In turn, this collectivized system has become so entrenched that determining genuine price discovery of anything is nearly impossible. This lack of price discovery deters private investment into the economy, which leaves the state as the primary economic driver.

When an economy is fundamentally bankrupt and no longer has a competitive productive capacity, government spending is the only thing propping up the economy.  However doomed the system may be, government spending does indeed represent jobs.  For example, even the flabby-assed NSA peon who is monitoring Internet activists all day still eats lunch, gets his lawn mowed, paints his house, raises a family, etc.  In other words, his needless job creates other jobs and supports other economic activity in the matrix.  So, if you cut his position, which I fully support doing, you bring economic hardship on him and the countless people his income contributes to.  This is simply a fact, and if the lost job isn't replaced in the private sector the economy will further contract.

Therefore, sadly, the debate about what to cut and what not to cut doesn't really matter. The controlled demolition of the economy will persist.  Since the U.S. is undoubtedly facing economic decline, and perhaps even a dramatic collapse, the private sector is unlikely to pick up the slack created by any public spending cuts.  And if there is one steadfast indicator, or instigator, of all recessions and depressions, it's that the available money supply in the economy shrinks.

Yes, despite the cranked-up printing presses at the Fed, the real money supply in America is shrinking to levels not seen since the Great Depression, leading some conservatives to call it "frightening." And it will continue to shrink even more with these proposed budget cuts.  It appears that most of the money printing is just being absorbed by the fraudulent financial system itself, and while the Fed's balance sheet continues to grow, inflation drives the price of essential goods like food and energy higher and higher.  In other words, inflation hits main street where it hurts at a time when main street has less dollars to spend.  It's the ultimate pinch.

Inversely, the budget cuts may indeed spur some short-term dollar strengthening in the matrix as the international banks will likely hype them as responsible governing.  This may cause dollar-based commodities to decline in price, which may temporarily simmer the outrage over record prices for food and other spiking commodities. However, this manufactured bliss for the dollar will be short-lived, as, again, the endless debt is not going away -- at least not until total default occurs.

Unfortunately, it seems that a return to a true free-market economy with sound money and limited government is only possible pending the total collapse of the current system. Perhaps free-market fiscal conservatives believe they can pragmatically chip away at entrenched collectivism of the State by incrementally de-funding the system. However, it would seem to only accelerate the slow demolition approach, and it definitely won't prevent the catastrophic debt-induced meltdown that America is headed for. What's more, budget cuts don't address the monopolistic control big business has over all industries.  Therefore, it appears unlikely that genuine free markets will manifest even after the money-illusion collapses so long as the global cartels control the real resources.

As much as I would like to believe these budget cuts will somehow erode the corporate collectivist state, it appears they will only cause more suffering to a good many people who had nothing to do with creating the suffocating national debt. In addition, the economic injustice in the recent past has been too great to believe those seeking these cuts have the people's interest at heart. Ultimately, I fear that the painful fallout will be used to discredit advocates for small government, and global corporate Statism will sprint to the endgame unchallenged.

Watch video below for an interesting perspective the national debt and collapse of the State:

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Banksters Give German Chancellor Her Marching Orders

Editor's Note:  How much more proof do you need that the U.S. Government is NOT working in your best interest!?!?

Laura Bassett
The Huffington Post

Despite soaring unemployment and the 19 million Americans currently living in "deep poverty," federal funds for the Temporary Assistance For Needy Families (TANF) program have entirely dried up for the first time since 1996, leaving states with an average of 15 percent less federal funding for the coming year to help an ever-increasing number of needy families.

TANF, the federal program that replaced welfare under the Clinton Administration, provides a lifeline for families and workers who have exhausted all of their unemployment benefits.

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U.S. Debt Woes Expose Hidden Austerity 

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The Austerity Hammer Starts to Fall on the U.S.


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Camden City Council Approves Massive Police And Fire Layoffs (Second Most Dangerous City in The Nation)

CBS Philly 

CAMDEN, NJ (CBS) – Camden City Council, as expected, voted Thursday to lay off almost 400 workers, half of them police officers and firefighters, to bridge a $26.5 million deficit.

That’s about a quarter of the city’s entire work force.

Five members of City Council voted unanimously to approve the layoff plan — two other members were absent. The cuts take effect in mid-January.

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RELATED ARTICLE:
10 Signs The U.S. is Becoming a Third World Country


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Cash-strapped governments ramping up tax-collection efforts

Markham Heid
Washington Examiner

Tax officials throughout the Washington region are trying new and often extraordinary measures to collect tens of millions of dollars in delinquent payments, as huge projected budget deficits threaten to slash public services.

Together, Washington-area localities are owed more than $40 million in overdue real estate taxes from fiscal 2010 alone. Additional millions in unrecovered fines, fees and personal property tax revenues compound those shortfalls.

They say they have been able to maintain historically high collection rates, but only by resorting to unusually aggressive collection methods.

"We give people appropriate notice, but if they ignore us, we'll just drive out to their house and remove their car from their driveway. That's an attention getter," said Arlington County Treasurer Frank O'Leary.

O'Leary said he has used such tactics in the past, but lately has encountered a startling new phenomenon.

"This year I sent my people out to collect some vehicles, and they came back and said the properties had been abandoned," O'Leary said. "That had never occurred in Arlington in all the years I'd been treasurer, and it was really sobering to hear that."

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RELATED ARTICLE:
US Debt Woes Expose Hidden Austerity and Looting of Public Assets

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11 State Pension Funds that May Run of Out Money

Provided by The Business Insider, October, 18, 2010:

Here's a shocker: The most immediate state pension crises aren't in New York or California. They're in Middle America.

When it comes to state pensions in the most trouble, do places like New Hampshire come to mind? Probably not, unless you live there, and maybe not even then.

After all, it makes sense that the biggest, most populous members of the union, where budget follies are fairly common, would be facing the most urgently needed fixes. The truth is considerably different. The Granite State claims the No. 11 slot, and it's not the only unexpected name facing pension woes.

Hawaii, Kansas and others made their way on to the list. Now, these pension plans aren't going to be obliterated tomorrow -- New Hampshire, for instance, is estimated to see its plan run out of money in 2022, so they've got 12 years to rectify the situation.

For some other states, the matter is more pressing, and no more so than for the Land of Lincoln.

Illinois is just 8 years away from exhausting its pension fund and creating a yearly $14 billion hole, according to data from Joshua Ruah an associate professor of finance at the Kellogg School of Management at Northwestern University.

That's a projected 32 percent of the state's revenue going to fill a pension hole. Every year.

Indiana, Louisiana, Oklahoma and Colorado are among the next pension funds to fall. The rest of the union is just around the corner.

But wait. Just to make sure the list is not a complete surprise, know that the New York City suburbs of Connecticut and New Jersey made it on board. They have until 2019 to sort it out.

And Now, 11 State Pension Funds That May Run of Out Money 

#1 Illinois

Year pension fund runs out: 2018

Bill in the following year: $13.6 billion

Share of state revenue: 32%

#2 Connecticut

Year pension fund runs out: 2019

Bill in the following year: $4.9 billion

Share of state revenue: 27%

#3 Indiana

Year pension fund runs out: 2019

Bill in the following year: $3.6 billion

Share of state revenue: 17%

#4 New Jersey

Year pension fund runs out: 2019

Bill in the following year: $14.4 billion

Share of state revenue: 34%

#5 Hawaii

Year pension fund runs out: 2020

Bill in the following year: $1.7 billion

Share of state revenue: 24%

#6 Louisiana

Year pension fund runs out: 2020

Bill in the following year: $4.3 billion

Share of state revenue: 27%

#7 Oklahoma

Year pension fund runs out: 2020

Bill in the following year: $3.7 billion

Share of state revenue: 30%

#8 Colorado

Year pension fund runs out: 2022

Bill in the following year: $7.8 billion

Share of state revenue: 54%

#9 Kansas

Year pension fund runs out: 2022

Bill in the following year: $2.5 billion

Share of state revenue: 23%

#10 Kentucky

Year pension fund runs out: 2022

Bill in the following year: $5.3 billion

Share of state revenue: 35%

#11 New Hampshire

Year pension fund runs out: 2022

Bill in the following year: $1.0 billion

Share of state revenue: 30%

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