Sunday, January 6, 2013

The National Debt Ceiling - The Next Crisis

The United States has already hit our $16.4 Trillion National Debt Ceiling as a result of Socialist President Obama's reckless spending.   We are borrowing 46 cents for every dollar that we spend.   Secretary of the Treasury Tim Geithner stated that he can play games with money to the tune of about $200 Billion to get us through the next few months; but then unless the Debt Ceiling is increased again, the United States will not be able to continue borrowing to fund Obama's deficit spending.  Keep in mind that Obama has added about $6 Trillion to the National Debt in his first four years in office; more than any other President in American history, with no end in sight. 

Despite what you hear from Socialists, or even Republican politicians, there have been no meaningful cuts in spending during Obama's Presidency.   The Trillion dollars that was supposed to be cut as part of the Fiscal Cliff deal has been put off for another two months, if it ever happens at all.   And, unless we see spending cuts of $4 - $5 Trillion in the next ten years and tax reform to spur economic growth, any amounts below are just chump change and will do nothing to deal with our National Debt and road to insolvency.  

Obama got his tax increases in ObamaCare and the Fiscal Cliff deal; though naturally as a Socialist he wants more as part of any "balanced" approach to dealing with deficit spending.   That is all BS.   The reality is that Social Security, Medicare and Medicaid are two thirds of the budget.    It is virtually impossible to deal with Obama's deficit spending and the National Debt problem without Entitlement Reform.   This does not have to be another crisis; but like always Drama Obama will cause another crisis by refusing to consider any common sense reform to save these programs. 

Every one knows that the Social Security age for full retirement benefits must continue to go up for people under 55 so that perhaps 30 year olds would not be able to access full benefits for Social Security until they are 70.   There is no need to means test Social Security since this Entitlement is already taxed.   So the "rich" only get a percentage of what they have earned anyway.   Everyone knows that Medicare must be means tested, even though only "rich" people have actually paid for their benefits through payroll contributions.   This must be done to protect the poor; but let's at least be honest about it. 

The cost of Medicaid is more problematic, especially since ObamaCare has added even more people to the roles.   Medicaid is a bottomless pit that can only be controlled by block grants to the states, based on what is affordable, not an endless amount of money that will be required to fund this program for the poor, as it is currently configured.  

This is all just common sense; but then Socialists, like Obama, suffer from Dream World Syndrome.   That is, they live in a Dream World related to spending.   They got their tax increases that are a job killer; yet Obama wants more that in the end will result in less government revenue because of slower economic growth that always comes from higher taxes.   This is just Economics 101; but Socialists never took that course.  So now, we will see the next crisis as Congress deals with the National Debt Ceiling. 

I have a $100 bottle of wine bet because I believe Obama will attempt to eliminate the Debt Ceiling altogether by Executive Order.   If Obama tries to do it, we will have a Constitutional Crisis that will end up in the Supreme Court; but Drama Obama is the King of Crisis so don't be surprised if it happens.   Here we go again. 

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