Drachmageddon

M2RB:  Rolling Stones, live at Twickenham, London

I see a red door and I want it painted black
No colors anymore I want them to turn black
I see the girls walk by dressed in their summer clothes
I have to turn my head until my darkness goes

I want to see your face painted black, black as night, black as coal
Don't want to see the sun, flying high in the sky
I want to see it painted, painted, painted, painted black, yea

 

By Robert Hardman

Antonis Perris was a devoted son. When his elderly mother was diagnosed with Alzheimer’s four years ago, there was no question of putting her in a state facility.

He would care for her at home in Athens and they would face the future together.

But then things started getting very much worse.

‘The problem is that I was not prepared when the economic crisis hit and I do not have enough money in my account,’ wrote the 60-year-old unemployed musician.

‘My credit card is overdrawn, we do not have enough food to feed ourselves. I live a drama with no end. Does anyone have a solution for me? World leaders, you who brought this financial crisis, you all need hanging!’

On the brink: Greeks will go to the polls again on Sunday, and the outcome of their votes will be critical for the country's future

Perris wrote of his despair in an internet chatroom three weeks ago. Then, one morning, he led his mother on to the roof of their five-storey apartment block. Hand-in-hand, they jumped off.

Not long ago, this episode would have been a national scandal. Today, it is just another tragic footnote to the story of a society on the brink of collapse.

On Monday morning, this modern European nation could be waking up to a nightmare scenario, which runs as follows. The cash machines start drying up. Supermarket shelves are cleared by families fearful that food supplies will run out.

There are queues round the block for the last dribbles from the petrol pumps, and deliveries come to a halt. Within a day or two, protests have turned to looting and random acts of violence against strangers. Overwhelmed, the police retreat to their bases. The most vulnerable citizens lock the doors and pray.

And gradually, the country that gave the world ‘democracy’ descends into another word it also created — ‘anarchy’.

Understandably, no one on the tense, graffiti-splattered streets of Athens wants to discuss this possibility ahead of tomorrow’s Greek election in case it becomes a self-fulfilling prophecy. For many, though, it is hard to envisage how much further they can fall.

Helen Papoutsi, 49, is a proud woman. A professor’s daughter, she has worked as a nurse for 27 years and has a daughter at university.

Yet she is one of many middle-class Greeks whom I find alongside homeless migrants and the mentally disabled in the early evening queue for a central Athens soup kitchen.

A plastic bowl of pasta will be Helen’s only square meal of the day.

‘They’ve cut my pay, I have to work longer hours and I can’t pay the bills any more,’ she says quietly, before dissolving into tears.

‘How can I be a good mother when I can’t even afford to support myself?’ She still has a faded carrier bag from a fancy Athens boutique and is clinging to what is left of her dignity. 

No hope: Greece's middle classes are facing crippling poverty, with many depending on hand-outs simply to eat

But like her unemployed friend and dinner companion, Georgia Goudi, she says she has no hope.

‘They want us to vote? For who? The rich will get richer and the poor poorer. It can only get worse.’

We are unlikely to see this nation implode in the immediate aftermath of tomorrow’s vote.

The most probable outcome is more procrastination and horse-trading — just like the dithering that followed the last, entirely inconclusive election in May, since when Greece has been without  a government.

But deep down, everyone knows that the status quo cannot go on much longer.

Greece is on borrowed time. Ultimately, Greeks face a choice between swallowing the austerity package imposed by the EU’s German paymasters — punitive taxation and a purge of the public sector — or they can be relegated from the euro and return to a much-devalued drachma.

The second option would see the country’s existing wealth cut by half.

And while it might enable Greece to rebuild itself over time, the first months of that journey would be perilous as a bankrupt nation found itself unable to buy essentials such as medicines, not to mention food.

It is a nightmare scenario that some have called ‘Drachmageddon’. And it is one we in Britain will feel acutely as billions are wiped off the value of our shareholdings and pension funds as the markets tumble amid fears that Spain and Italy might be next.

On a knife-edge: Supporters of the conservative New Democracy party waves flares during a rally at Syntagma square in Athens

One thing is certain. Absolutely no one in Athens expects any improvement in the dismal situation that constitutes ordinary life in Greece today.

In the days since I arrived here, the local news has included the following stories: a pharmacist shot dead for his day’s takings; chemists all over Athens running out of cancer drugs; a ferry company unable to pay for fuel, thus stranding thousands of people on several Aegean islands; a lynch mob attacking a fisherman on a government exchange programme — for being Egyptian.

Walking the streets, I have met a neo-Nazi party with a surging  popular vote and a proposal to halt illegal immigration with landmines.

I have wandered amid the weeds of derelict Olympic stadia built just eight years ago at vast expense for those ruinous 2004 Games. Anyone for softball? If not, how about planting some carrots on the pitch?

I have toured a bank vault without a single vacant deposit box because everyone wants to lock away their valuables in case the country descends into lawlessness. 

Even if the dreaded meltdown does not come to pass on Monday, the spectre is still not going to  go away.  There are two main players in this election. One is New Democracy, a centre-Right party that wants to renegotiate the German bail-out deal while staying in the euro. As far as Germany and the international markets are concerned, this lot would be the preferred option. 

The other front-runner is Syriza, an untried Far Left consortium that wants to tear up the German deal, abandon public sector cuts and yet, somehow, remain in the euro.

If Syriza wins an outright victory, watch the markets fall off a cliff on Monday morning.

The likely outcome, though, is some sort of fragile coalition involving elements of both these factions and a demand for a new deal. But if the Germans decide there is no further scope for negotiation (and the German public certainly feels that way), then tomorrow’s election could be immaterial.

After another period of fraught EU negotiations, Greece would be shown the door and it would be Drachmageddon time anyway.

There is a palpable sense of poverty almost everywhere. Some areas have become feral no-go zones after dark. And yet what I find most surprising is the sense of calm, almost defiant resignation.

There has been no stampede for petrol or food. True, people have been withdrawing cash at the rate of up to 800 million euros a day, and an estimated 70 billion euros is thought to have been squirrelled away in foreign bank accounts in recent months.

But what is perhaps more surprising is that 170 billion euros is still sitting in ordinary Greek bank accounts. There have been no queues outside Athenian banks this week. In short, there is no panic.

New Democracy: The party's supporters wait for a speech from its leader, Antonis Samaras, during a pre-election campaign rally

‘Perhaps this is what it feels like just before the volcano is about to explode,’ says Nikos Konstandaras, columnist and managing editor of the mainstream national newspaper, Kathimerini.

‘This election offers no clear solution, no clear choice between “in” or “out” of the euro. So many people have taken the view that what will happen, will happen.’

Ever since the Greek economy went into freefall after the global economic crisis of 2008, the Greeks have been blaming their politicians — and the Germans — for their plight. But wiser Greeks concede that the real culprit is to be found in the mirror. The fact is that for years, Greece juggled a ludicrously bloated public sector with a national allergy to paying tax.

Last month, Christine Lagarde, head of the International Monetary Fund, prescribed a simple path to Greek salvation: ‘I think they should help themselves collectively — by all paying their tax.’

She was castigated in Greece for her insensitivity, but she had one ally — the Greek taxman.

‘I agree wholeheartedly. Tax evasion in Greece amounts to 45 billion euros each year,’ said Nikos Lekkas, head of the Greek tax authority. ‘If we could raise even just half of that, Greece’s problems would be solved.’

His main problem, he added, was a conspiratorial lack of co-operation from the banks.

The Greek economy has long been a basket case. Until last year, anyone belonging to one of 600 ‘hazardous occupations’, including hair stylists, cashiers and radio announcers, could retire in their early 50s on a state pension equivalent to 80 per cent of their final salary. Just 5,000 people in a country of nine million admitted to earning more than £90,000 a year.

Greece’s shipping billionaires, meanwhile, enjoyed (and still enjoy) tax-free status on the basis their industry brings in 14 billion euros to the economy each year and they might go elsewhere if threatened. 

Threatening: Extreme right party Golden Dawn has said it will remove immigrants from hospitals and nurseries in Greece if it wins power (pictured is party candidate Ilias Panagiotaros)

The system has been tightened. The list of ‘hazardous occupations’ has been halved (though it still includes cheesemakers). Retirement ages have risen and pensions have been slashed by between 10 and 30 per cent. Yet most government offices are still overstaffed and incompetent. Buying something as simple as a car tax disc can take a day.

Just this week, it has emerged that Mr Lekkas and his team of tax collectors have had considerable success with a new innovation — a form of council tax.

Millions of Greeks were outraged by the suggestion that, having paid a purchase tax (what you and I know as stamp duty), they should also pay a further tax on their property. They call it haritsa — ‘the axe’.

But the taxman had the bright idea of attaching it to the electricity bill. So, if you dodge this tax, you get disconnected. As a result, it has already raised more than 2 billion euros.

Meanwhile, the inevitable rise of the extremists should worry us all. Certainly, a trip to the Athens headquarters of the Golden Dawn party is an alarming experience. Having had negligible support in recent years, this overtly fascistic organisation ended up with 21 seats at the last election.

Last week, a senior party figure hit a female Communist during a live TV debate and then ran from the studio — though he is now suing her for ‘provocation’.

Despite this, the party is expecting an increase in its votes tomorrow.

Shocking: This footage from Greece's private Antenna television station shows Elias Kassidiaris, front left, spokesman for Golden Dawn, slapping Liana Kanelli, a former MP for the Communist Party of Greece

Golden Dawn, frankly, make the BNP look fluffy. There are heavies from central casting on the door. They warn me that it is strictly forbidden to photograph the building, hilarious given that it is on a main road with an enormous banner draped over a second floor balcony saying: ‘Greece for the Greeks.’

Everything is decorated with the party’s symbol, a variation on the swastika inside a laurel wreath.

Inside, walls are lined with photographs of Nuremburg-style rallies with plenty of flaming torches. ‘We are not Nazis. We are nationalists,’ says Golden Dawn candidate Ioannis Vloudis firmly.

So how come they march around with torches and swastikas? ‘It is not a swastika,’ says the retired vet. ‘It’s a 2,500-year-old symbol from ancient Thrace. It’s not our fault if the Nazis stole our symbol.’

He says his party wants Greece to stay in the euro, renegotiate the bailout and get the rich to pay more tax. Just like every party on the opposite side of the political spectrum, then. What separates Golden Dawn is its naked xenophobia.

It not only wants to seal Greece’s eastern border — with landmines if necessary — and deport the country’s estimated 700,000 illegal immigrants. Its members have called for immigrants to be removed from hospitals and nurseries.

Meanwhile, attacks on ethnic minorities in Greece are increasingly commonplace.

Meltdown: Neo-Nazi attitudes are gaining ground in Greece - and the police and ethnic minorities are paying the price

For others, it is the Germans who are the villains. Everywhere I go, the level of casual anti-German vitriol is astonishing.

‘They slaughtered whole villages here, and now they want to tell us what to do? Merkel [the German chancellor] is like Hitler,’ says Stavros Vasilarkos, 58, in his near-empty bar in the shipbuilding district of Perama.

At the back of the bar, a handful of unemployed men make a coffee last all night as they play pool or backgammon. ‘Who are these Germans anyway?’ asks Vasilarkos. ‘They were in the trees with tails when Greeks were building beautiful buildings such as the Parthenon.’

He cites the story of a group of German holidaymakers who recently walked out of a Cretan nightclub without paying for their beers. They argued they didn’t need to pay since Germany had covered the cost with its latest bail-out. They were never going to win the brawl that followed.

Down at the port city of Piraeus, Father Andreas Marcopolos is starting the daily task of supplying 3,500 free meals to his flock, ranging from homeless immigrants to impoverished professionals. 

Can it hold? If Greece votes to reject the austerity package imposed by the IMF and World Bank, it will see its existing wealth cut in half

The imposing church of St Nicholas faces a huge cruise ship, the Noordam, on the other side of a thick fence.

‘The shipowners give us nothing. They have no heart,’ says the normally jovial 58-year-old priest.

‘We are a Third World country and it is getting worse.’

He introduces me to Diana Fanelaki, 45, a mother of four children. Her husband, a chef, has not worked since January and their electricity has been disconnected for months.

She has just been served with an eviction order and receives no benefits because her husband failed to pay enough into the state welfare scheme.

I try to explain how welfare is a very different prospect in Britain. But she thinks I am joking. For a second or two, I can almost detect a smile.

Whether she will find anything to lift her mood after tomorrow’s elections is another matter.

As the world watches and waits, the birthplace of democracy is a pitiful sight this weekend.



Paint It Black - Rolling Stones

I see a red door and I want it painted black
No colors anymore, I want them to turn black
I see the girls walk by dressed in their summer clothes
I have to turn my head until my darkness goes

I see a line of cars and they're all painted black
With flowers and my love, both never to come back
I see people turn their heads and quickly look away
Like a newborn baby it just happens ev'ryday

I look inside myself and see my heart is black
I see my red door and I must have it painted black
Maybe then I'll fade away and not have to face the facts
It's not easy facing up when your whole world is black

No more will my green sea go turn a deeper blue
I could not foresee this thing happening to you
If I look hard enough into the setting sun
My love will laugh with me before the morning comes

I see a red door and I want it painted black
No colors anymore I want them to turn black
I see the girls walk by dressed in their summer clothes
I have to turn my head until my darkness goes

I want to see your face painted black, black as night, black as coal
Don't want to see the sun, flying high in the sky
I want to see it painted, painted, painted, painted black, yea

The Rain Of Greek Pain May Have Ended On A Plain In Spain...But, Only Temporary Will Be The Gain

M2RB:  The GoGo's

Vacation
All I ever wanted
Vacation
Had to get away
Vacation

"Germans are not prepared to pay for anyone's 'vacation from reality'." 

- Der Spiegel

By Gwynne Dyer
Published in the Japanese Times as "Greek election decided in Spain"

It's probably the first time that events in Spain have decided the outcome of a Greek election. Last weekend the European Union agreed to loan Spain's nearly insolvent banks €100 billion on relatively easy terms. Syriza, the hard-left protest party that came from nowhere to dominate last month's election in Greece, will therefore almost certainly emerge from next Sunday's rerun of that election as the biggest party in parliament.

The party that wins the largest number of votes in a Greek election gets an extra 50 seats, so Syriza will probably lead the next Greek government. It would then demand a renegotiation of the EU's much harsher terms for bailing out the Greek economy — and it might even get it. 

That would prolong the agony of the euro, but it wouldn't actually save it. The common currency is doomed, at least in its current form, precisely because countries like Greece and Spain were allowed to join the euro.

It's not that they were more reckless and improvident than the Northern European countries who were really guaranteeing the common currency's value (though the Greeks certainly were). What dooms the euro is the fact that the Southern European economies are far less efficient.

The fundamental mistake was made in 1999, when the political attraction of a common European currency triumphed over the economic rationality that said countries with radically different economies should not be trapped in a single currency. The current financial crisis, which threatens to destroy Europe's prosperity and even its unity, is an inevitable consequence of that original error.

The economic logic argues that less productive economies should have their own currencies, which they can devalue from time to time in order to stay competitive. But the political imperative of European unity is still seen as linked to the euro (though it doesn't have to be). Endless dithering over bail-outs is the result.

What happened to Spain illustrates the problem. Spanish governments were responsible in their euro borrowing: they never ran a deficit of over 3 percent before the world financial crisis hit in 2008. The euro did, however, let Spanish consumers and companies borrow money at a very low rate of interest, since everybody assumed that the powerhouse economies of northern Europe were the ultimate guarantors of euro debt.

The result was one of history's biggest housing bubbles, a mountain of corporate debt as Spanish companies went in for headlong expansion — and huge exposure to bad risks by the Spanish banks that lent the money.

In 2008 the inflated property values crashed and the foolish investments came home to roost. The Spanish government's borrowing ballooned as it poured money into saving the banks — and when it could not raise any more funds either, the European Union stepped in last week with €100 billion to stave off a default.

Well, it had to. A Spanish default would bring the whole rickety structure crashing down, and nobody has yet figured out how to dismantle the euro without a huge amount of collateral damage. The EU is merely doing crisis management and has no strategy for fixing the euro (other than a unified European state, which is not going to happen). But what interests the Greeks is the terms of the EU loan to Spain.

Or rather, the lack of any restrictive conditions in the EU loan: 

It imposed no obligation for the Spanish government to raise taxes or cut spending further. That is exactly the deal that Alexis Tsipras, the charismatic leader of the Syriza party, says he can get for Greece, and in this last week before the Greek election he will use the evidence from Spain to good effect. He will, of course, make no mention of the fact that Spain's crisis and Greece's are very different.

From the day the euro was launched in 2002, Greek governments borrowed like there was no tomorrow, and lied to the EU both about the scale of the country's indebtedness and the purposes of the loans. (Much of the money went into the pockets of their own cronies and supporters.) The entire country was living far beyond its means, which is why the decline in Greek living standards since the crisis struck has been so steep.

Greek voters don't want to hear about that. They just want the pain to stop, and many of them believe Tsipras' promise that a new government led by the Syriza party can renegotiate the terms of the bail-out so it hurts less.

He may be right, at least in the short run. Even if there were some super-secret team of financial experts in Frankfurt working out how to wind the euro up without too much damage to the German economy, they would need to time their move very carefully. They would not want a Greek default to cause the euro to unravel prematurely, and a flat "no" to Tsipras could bring that on very fast.

In fact, there almost certainly is no such team. There is no "Plan B," and all the EU authorities are doing is endless day-to-day crisis management. One day it will fail, but they're not ready to admit that yet. So the Greeks may actually win some short-term relief by giving Syriza a mandate.

Gwynne Dyer is an independent journalist whose articles are published worldwide.

Vacation - The GoGo's

Can't seem to get my mind off of you
Back here at home there's nothin' to do
Now that I'm away
I wish I'd stayed
Tomorrow's a day of mine
That you won't be in

When you looked at me
I should've run
But I thought it was just for fun
I see I was wrong
And I'm not so strong
I should've known all along
That time would tell

A week without you
Thought I'd forget
Two weeks without you and I
Still haven't gotten over you yet

Vacation
All I ever wanted
Vacation
Had to get away
Vacation
Meant to be spent alone

Vacation
All I ever wanted
Vacation
Had to get away
Vacation
Meant to be spent alone

[Instrumental Interlude]

A week without you
Thought I'd forget
Two weeks without you and I
Still haven't gotten over you yet

Vacation
All I ever wanted
Vacation
Had to get away
Vacation
Meant to be spent alone

Vacation
All I ever wanted
Vacation
Had to get away
Vacation
Meant to be spent alone

Vacation
All I ever wanted
Vacation
Had to get away
Vacation
Meant to be spent alone

Robbing The Future To Pay For Promises Of The Past

M2RB:

 

 A live wire, barely a beginner
But just watch that lady go
She's on fire, 'cause dancin' gets her higher than-uh
Anything else she knows

Ooh, baby baby
Won't-cha turn your head my way?
Ooh, baby baby
Well don't skip romance 'cause
You're old enough to

Dance the night away
Oh-oh-oh (Ah) Come on g-girl, dance the night away

 There Are No Winners In The War Against The Young

By Walter Russell Mead

That’s the reality, writes Matt Miller in the Washington Post:

You [younger Americans] are in big trouble. You don’t even know it. You’re busy trying to get a degree, land a job, start a family, save for a home. You don’t follow the news. But trust me—you’ve been taken for a ride by your elders. . . .

The job market for young people is a disaster, the toll of a burst financial and housing bubble that both parties let fester. The crisis has reached the point where years of unpaid labor (in the form of internships) have become a way of life for millions of Americans in their 20s.

Our K-12 schools have slid from the best in the world to mediocre under both Republican and Democratic presidents and governors. That’s largely because for decades we’ve embraced a bipartisan policy of recruiting middling students to become teachers.

Our roads, bridges, sewers, airports and power grids desperately need upgrades. Our investments in research and development as a share of our economy trail that of our peers. Republicans don’t seem to care. Democrats care enough to propose token sums that would fund a fraction of the need.

There’s no cash for such investments in the future because pension and health-care programs for seniors (plus a bloated Pentagon) take up so much of the budget. At the federal level, seven dollars go to programs supporting elderly consumption for every dollar invested in people under 18. Nationally (after taking account of the fact that most education is paid for at the state and local level), the ratio is still 2 ¹ / ₂ to one…

Want more? For years, states have let public pension managers assume their investments would grow 7.5 or 8 percent a year, when 3 to 6 percent has been more realistic. This bipartisan ploy hides trillions more in pension shortfalls, funds that will have to be forked over one day by (you guessed it) younger Americans.

Read the whole thing. Miller echoes arguments Via Meadia has been making for some time. The evidence is devastating, but as Miller concludes, young people haven’t woken up to the dangers, even as the policies that turn the screws on them have gone on for years.

In 1995, when I was a (younger) generational equity worrywart, I asked then-Sen. Alan Simpson how to fix what was clearly coming. Simpson told me nothing would change until someone like me could walk into his office and say, “I’m from the American Association of Young People. We have 30 million members, and we’re watching you, Simpson. You [mess with] us and we’ll take you out.”

Will the kids wake up one day soon? Will anything be done to save them from paying their elders’ bills in addition to the hefty bills for other responsibilities and desires like having a family or buying a home?

This is partly because we’ve had two generations of older people behave with extreme shortsightedness and selfishness: the Boomers and their immediate heirs have been chasing unicorns and building their self esteem while neglecting their basic duties. But as Miller acknowledges it’s also partly because the challenges we face today are unusually hard. Many of our core systems — government, education, health care — are becoming impossibly expensive and unproductive given the demands that contemporary life puts on them.

America needs an upgrade, and young people need it more than anybody else. The old ways of doing things are gradually choking the life out of the country and making it harder and harder for people to do very simple things — like starting a family, raising, kids, preparing for retirement.

Generational equity is one of the reasons America has to change the way it does business; but every generation — including those not yet born — has a stake in breaking the chains that hold us back.

The IT revolution and globalization shouldn’t be impoverishing us; they offer unparalleled opportunities to give Americans the chance to live richer, more interesting and more fulfilling lives than ever before. But it’s raining soup, and America is still standing there with a fork — a blue model fork, and it’s just not what we need.

+++++++++++++++++++++++++++++++++++++

Sophie:

As I wrote in "'Lies' About Social Security and Medicare Pandering Politicians Never Told You," the demands that will be made on today's young to pay for promises made to seniors will grow to such an oppressive degree that it is entirely delusional for anyone to believe that it will not provoke widespread unrest and, perhaps, outright violence between generations.

It is true that the government made promises to pay Social Security and Medicare.  It is also true that when those promises were originally made demographics were on its side -- at least to a degree.  They no longer are:

Fact:  There were 159.4 workers for each Social Security recipient in 1940.

Fact:  There were 16.5 workers for each Social Security recipient in 1950.

Fact:  There were 5.1 workers for each Social Security recipient in 1960.

Fact:  There were 3.7 workers for each Social Security recipient in 1970.

Fact:  There were 3.2 workers for each Social Security recipient in 1980.

Fact:  There were 3.4 workers for each Social Security recipient in 1990.

Fact:  There were 3.4 workers for each Social Security recipient in 2000.

Fact:  There were 3.3 workers for each Social Security recipient in 2005. 

Fact:  There were only 1.75 full-time private-sector workers in the United States last year for each person receiving benefits from Social Security, according to data from the Bureau of Labor Statistics and the Social Security board of trustees.

Furthermore:

Fact:  The average senior receives in Social Security about a third of what the average worker makes.

Fact:  In 1940, the average worker had to pay only 0.2% of his salary to sustain the seniors of his time.

Fact:  In 1950, the average worker had to pay only 2% of his salary to sustain the seniors of his time.

Fact:  In 2011, the average worker has to pay 11% of his salary to sustain the seniors of his time.

Fact:  In 2131, the average worker will have to pay 17% of his salary to sustain the seniors of his time.  This is a staggering sum, considering that it is apart from all the other taxes he pays to sustain other functions of government, such as Medicare, whose costs are exploding. 

Projection: When today's college students reach retirement (about 2054), Social Security alone will require a 16.6% payroll tax, one-third greater than today's rate, according to the non-partisan Peterson-Pew Commission on Budget Reform.

Projection: When Medicare Part A is included, the payroll tax burden will rise to 25.7% - more than one of every four dollars workers will earn that year.

Projection: If Medicare Part B (physician services) and Part D are included, the total Social Security/Medicare burden will climb to 37% of payroll by 2054 - one in three dollars of taxable payroll, and twice the size of today's payroll tax burden, according to the non-partisan Peterson-Pew Commission on Budget Reform. 

Projection: More than one-third of the wages workers earn in 2054 will need to be committed to pay benefits promised under current law. That is before any bridges or highways are built and before any teachers' or police officers' salaries are paid. 

Projection: By 2030, about the midpoint of the baby boomer retirement years, the Medicare will require nearly half of all income tax dollars, according to the non-partisan Peterson-Pew Commission on Budget Reform. 

Projection: By 2060, Social Security and Medicare will require nearly three out of four income tax dollars. 

No one is arguing that the Greatest Generation didn't earn their due, but they were able to come home and start families, work to buy homes, and have decent lives.  Compare the life following the war to that what we would demand of American workers in the future:  A full 37% payroll tax to pay for the promises made by long-dead politicians in a completely different economic and geo-political environment.   The amount of money necessary to fulfill the promises made yesterday and today would cost future workers the ability to enjoy the very lifestyle that their forebears returned to create after freeing the world from the threats of Naziism, Fascism, and Japanese Imperialism.

Dance The Night Away - Van Halen

 

Have you seen her? So fine and pretty
Fooled me with her style and ease
And I feel her from across the room
Yes, it's love in the third degree

Ooh, baby baby
Won't-cha turn your head my way?
Ooh, baby baby
Ah come on! Take a chance
You're old enough to

Dance the night away
Whoa-oh (Ah) Come on g-girl, dance the night away

A live wire, barely a beginner
But just watch that lady go
She's on fire, 'cause dancin' gets her higher than-uh
Anything else she knows

Ooh, baby baby
Won't-cha turn your head my way?
Ooh, baby baby
Well don't skip romance 'cause
You're old enough to

Dance the night away
Oh-oh-oh (Ah) Come on g-girl, dance the night away

Oh, oh-oh-oh oh yeah

Dance (oh) the night away. Hey, hey, yeah!
Dance, dance, dance the night away
Ah come on baby (Dance the night away) Hey, hey yeah!
Dance, dance, dance the night away
Uh, come on baby, baby , Dance the night away Ooh, ooh, yeah
Dance, dance, dance the night away. Ah, ha ow!

Pic of the Day: Shovel-Ready BS

M2RB:  Guns 'n Roses

'Cause you're crazy
You're fuckin' crazy
Ya know you're crazy
I said you're crazy

h/t Legal Insurrection:

"Shovel-ready was not as ... uh .. shovel-ready as we expected." 

- President Barack Obama, smiling beside a laughing Jeffrey Immelt, Chairman of the Coard and CEO of General Electric and Chairperson of President Obama's Council on Jobs and Competitiveness, 13 June 2011

You're Crazy

I been lookin' for a trace
Lookin' for a heart
Lookin' for a lover in a world that's much too dark
You don't want my love
You want satisfaction
You don't need my love
You gotta find yourself another
Piece of the action
Said where you goin'
What you gonna do
I been lookin' evrywhere
I been lookin' for you
You don't want my love
You want satisfaction
You don't need my love
You gotta find yourself another
Piece of the action
'Cause you're crazy
You're fuckin' crazy
Ya know you're crazy
I said you're crazy
Say boy where ya comin' from
Where'd ya get that point of view
When I was younger
Said I knew someone like you
And they said
You don't want my love
You want satisfaction
You don't need my love
You gotta find yourself another
Piece of the action
'Cause you're crazy
You're fuckin' crazy
You know you're crazy
I said you're crazy
Ooh you're crazy
You know you're crazy
Well you're crazy
You know you're crazy
You know you are
Bring it down
You're fuckin' crazy

President Obama: The Biggest Government Spender In World History

M2RB:  Queen

 The minute you walked in the joint
I could see you were a man of distinction,
A real big spender,
Good looking, so refined.
Say wouldn't you like to know what's going on in my mind?

Let me get right to the point,
I don't pop my cork for every girl I see.
Hey, big spender,
Spend a little time with me.

By Peter Ferrara

The U.S. has never before had a President who thinks so little of the American people that he imagines he can win re-election running on the opposite of reality. But that is the reality of President Obama today.

Waving a planted press commentary, Obama recently claimed on the campaign stump, “federal spending since I took office has risen at the slowest pace of any President in almost 60 years.”

Peggy Noonan aptly summarized in last weekend’s Wall Street Journal the take away by the still holding majority of Americans living in the real world:

“There is, now, a house-of-cards feel about this administration.  It became apparent some weeks ago when the President talked on the stump – where else? – about an essay by a fellow who said spending growth [under Obama] is actually lower than that of previous Presidents.  This was startling to a lot of people, who looked into it and found the man had left out most spending from 2009, the first year of Mr. Obama’s Presidency.  People sneered: The President was deliberately using a misleading argument to paint a false picture!  But you know, why would he go out there waiving an article that could immediately be debunked?  Maybe because he thought it was true.  That’s more alarming, isn’t it, the idea that he knows so little about the effects of his own economic program that he thinks he really is a low spender.”

What this shows most importantly is that the recognition is starting to break through to the general public regarding the President’s rhetorical strategy that I’ve have been calling Calculated Deception.  The latter is deliberately using a misleading argument to paint a false picture.  That has been a central Obama practice not only throughout his entire presidency, but also as the foundation of his 2008 campaign strategy, and actually throughout his whole career.

Rest assured, Ms. Noonan, that the President is not as nuts as he may seem at times.  He knows very well that he is not a careful spender.  His whole mission is to transform the U.S. not into a Big Government country, but a Huge Government country, because only a country run by a Huge Government can be satisfactorily controlled by superior, all wise and beneficent individuals like himself.  That is why he is at minimum a Swedish socialist, if not worse.  Notice, though, how far behind the times he and his weak minded supporters are, as even the Swedes have abandoned Swedish socialism as a failure.

The analysis by Internet commentator Rex Nutting on which Obama based his claim begins by telling us “What people forget (or never knew) is that the first year of every presidential term starts with a budget approved by the previous administration and Congress.”  Not exactly.

The previous administration, or President, proposes a budget.  The previous Congress approves a budget.  And what Congress approves can be radically different from what the President proposes.

As Art Laffer and Steve Moore showed in the Wall Street Journal on Tuesday, President Bush began a spending spree in his term that erased most of the gains in reduced government spending as a percent of GDP achieved by the Republican Congress in the 1990s led by former House Speaker Newt Gingrich, in conjunction with President Clinton.  But for fiscal year 2009, President Bush in February, 2008 proposed a budget with just a 3% spending increase over the prior year.  Fiscal year 2009 ran from October 1, 2008 until September 30, 2009.  President Obama’s term began on January 20, 2009.

Recall, however, that in 2008 Congress was controlled by Democrat majorities, with Nancy Pelosi as Speaker of the House, and the restless Senator Obama already running for President, just four years removed from his glorious career as a state Senator in the Illinois legislature.  As Hans Bader reported on May 26 for the Washington Examiner, the budget approved and implemented by Pelosi, Obama and the rest of the Congressional Democrat majorities provided for a 17.9 percent increase in spending for fiscal 2009!

Actually, President Obama and the Democrats were even more deeply involved in the fiscal 2009 spending explosion than that.  As Bader also reports, “The Democrat Congress [in 2008], confident Obama was going to win in 2008, passed only three of fiscal 2009’s 12 appropriations bills (Defense, Military Construction and Veterans Affairs, and Homeland Security).  The Democrat Congress passed the rest of them [in 2009], and [President] Obama signed them.”  So Obama played a very direct role in the runaway fiscal 2009 spending explosion.

Note as well that President Reagan didn’t just go along with the wild spending binge of the previous Democratic Congress for fiscal year 1981 when he came into office on January 20 of that year.  Almost no one remembers now the much vilified at the time 1981 Reagan budget cuts, his first major legislative initiative. Then Democrat Rep. Phil Gramm joined with Ohio Republican Del Latta to push through the Democratic House $31 billion in Reagan proposed budget cuts to the fiscal year 1981 budget, which totaled $681 billion, resulting in a cut of nearly 5% in that budget.  Obama could have done the exact same thing when he entered office in January, 2009, even more so with the Congress totally controlled by his own party at the time.

Reagan then ramped up the spending cuts from there.  In nominal terms, non-defense discretionary spending actually declined by 7.1% from 1981 to 1982.  But roaring inflation at the time actually masks the true magnitude of the Reagan spending cut achievement.  In constant dollars, non-defense discretionary spending declined by 14.4% from 1981 to 1982, and by 16.8% from 1981 to 1983.  Moreover, in constant dollars, this non-defense discretionary spending never returned to its 1981 level for the rest of Reagan’s two terms!  By 1988, this spending was still down 14.4% from its 1981 level in constant dollars.

Even with the Reagan defense buildup, which, remember, won the Cold War without firing a shot, total federal spending as a percent of GDP declined from a high of 23.5% of GDP in 1983 to 21.3% in 1988 and 21.2% in 1989.  That’s a real reduction in the size of government relative to the economy of 10%, a huge achievement.

In sharp contrast to Reagan, Obama’s first major legislative initiative was the so-called stimulus, which increased future federal spending by nearly a trillion dollars, the most expensive legislation in history up till that point.  We know now, as thinking people knew at the time, that this record shattering spending bill only stimulated government spending, deficits and debt.  Contrary to official Democrat Keynesian witchcraft, you don’t promote economic recovery, growth and prosperity by borrowing a trillion dollars out of the economy to spend a trillion dollars back into it.

But this was just a warm up for Obama’s Swedish socialism.  Obama worked with Pelosi’s Democratic Congress to pass an additional, $410 billion, supplemental spending bill for fiscal year 2009, which was too much even for big spending President Bush, who had specifically rejected it in 2008.  Next in 2009 came a $40 billion expansion in the SCHIP entitlement program, as if we didn’t already have way more than too much entitlement spending.

 

But those were just the preliminaries for the biggest single spending bill in world history, Obamacare, enacted in March, 2010.  That legislation is not yet even counted in Obama’s spending record so far because it mostly does not go into effect until 2014.  But it is now scored by CBO as increasing federal spending by $1.6 trillion in the first 10 years alone, with trillions more to come in future years.

After just one year of the Obama spending binge, federal spending had already rocketed to 25.2% of GDP, the highest in American history except for World War II.  That compares to 20.8% in 2008, and an average of 19.6% during Bush’s two terms.  The average during President Clinton’s two terms was 19.8%, and during the 60-plus years from World War II until 2008 — 19.7%.  Obama’s own fiscal 2013 budget released in February projects the average during the entire 4 years of the Obama Administration to come in at 24.4% in just a few months.  That budget shows federal spending increasing from $2.983 trillion in 2008 to an all time record $3.796 trillion in 2012, an increase of 27.3%.

Moreover, before Obama there had never been a deficit anywhere near $1 trillion.  The highest previously was $458 billion, or less than half a trillion, in 2008. The federal deficit for the last budget adopted by a Republican controlled Congress was $161 billion for fiscal year 2007.  But the budget deficits for Obama’s four years were reported in Obama’s own 2013 budget as $1.413 trillion for 2009, $1.293 trillion for 2010, $1.3 trillion for 2011, and $1.327 trillion for 2012, four years in a row of deficits of $1.3 trillion or more, the highest in world history.

President Obama’s own 2013 budget shows that as a result federal debt held by the public will double during Obama’s four years as President.  That means in just one term President Obama will have increased the national debt as much as all prior Presidents, from George Washington to George Bush, combined.

But this 2012 election is defined for the voters by the future, not the past.  And that future is fully revealed by the stark contrast between President Obama’s spending, deficits and debt projected under his proposed 2013 budget, and the projections under House Budget Committee Chairman Paul Ryan’s budget, adopted by the Republican House, and endorsed by presumptive Republican Presidential nominee Mitt Romney.

Despite all the controversy in Washington and in the media over Ryan’s budget, what it all adds up to is just to restore federal spending to its long term, postwar, historical average of 20% of GDP.  That stable level of federal spending, with some modest variance, prevailed for over 60 years after the end of World War II, until 2009.  Ryan’s budget reduces federal spending from an average of 24.4% of GDP during the Obama years to 20.1% after just 3 years, by 2015.

By contrast, under the budget policies supported by President Obama and Congressional Democrats, federal spending soars to 30% of GDP by 2027, 40% by 2040, 50% by 2060, and 80% by 2080.  Obama’s 2013 budget proposes to spend $47 trillion over the next 10 years, the most in world history by far, increasing federal spending by $1.5 trillion above the current CBO baseline.  Ryan’s budget proposes to cut that by $6.8 trillion.  By 2022, Ryan’s budget would be spending nearly a trillion dollars less per year than President Obama’s budget.

Ryan proposes tax reform to consolidate the current 6 individual income tax rates, ranging up to 35%, to just two rates of 10% and 25%.  His budget would otherwise retain the Bush tax rates of 15% for capital gains and 15% for corporate dividends, and repeal the Alternative Minimum Tax.  Ryan also proposes corporate tax reform, closing loopholes and reducing the federal corporate tax rate from 35% to 25%, which is roughly the international average.  CBO scores these reforms, even with the rate cuts, as again restoring federal revenues to their long term, postwar, historical average of 18.3% of GDP by 2015.

Obama’s budget, in sharp contrast, proposes to increase federal taxes by nearly $2 trillion over the next 10 years above the CBO baseline.  The budget projects that under Obama’s tax policies federal income tax revenues will double by 2020, federal corporate tax revenues will double by 2017, and federal payroll taxes will double by 2022.

Next year, under President Obama’s policies, the top tax rates of virtually every major federal tax are already scheduled to increase under current law.  That is because the Obamacare tax increases are scheduled to go into effect, and the Bush tax cuts expire, which President Obama proposes refuses to renew for singles making over $200,000 a year, and couples making over $250,000.  President Obama is now proposing on top of that the Buffett Rule, which would increase tax rates on capital gains and dividends even further.  Counting that, next year the top tax rate for capital gains would increase by 100%, the top tax rate on corporate dividends would increase by 100%, the top two income tax rates would increase by nearly 20%, and the Medicare payroll tax again for singles making over $200,000 and couples making over $250,000 would increase by 62% (under Obamacare).

This is all on top of the corporate income tax rate, which counting state corporate rates is nearly 40%, the highest in the world now, except for the socialist one party state of Cameroon.  Under the Buffett Rule, America’s capital gains tax rate would be the fourth highest in the industrialized world.  Based on historical precedent, these tax rate increases are unlikely to raise anywhere near the revenue projected by CBO, meaning even higher future deficits and debt.

Under Ryan’s budget, even with CBO’s static scoring, the federal deficit in actual nominal dollars would be reduced to $182 billion by 2017, the fifth year of the budget.  That compares to $1,327 billion, or $1.327 trillion, today.  So in just 5 years, the deficit would be reduced by at least 86%.  The deficit under Ryan’s budget would be less than 1% of GDP by 2017, at 0.9%, where it stabilizes for 6 years to the end of the 10 year budget window.  Most importantly, given the sharp tax rate cuts in Ryan’s budget, with dynamic scoring the budget would probably be balanced by 2017.  That is because in the real world the rate cuts will not lose nearly as much revenue as CBO scores.

Under President Obama’s budget, his own projections show the deficit never gets anywhere near balance.  Indeed, the deficit never gets below or anywhere near the former all time record in 2008.  By 2022, his own budget projects the deficit rising over the previous 5 years to $704 billion.  But if Obama’s comprehensive tax rate increases throw the country back into recession next year, the deficits will soar much higher for several years, to new all time records.

Even under CBO’s horse and buggy static scoring, Ryan’s budget does serve to get federal debt under control and avoid any debt crisis, putting federal debt held by the public on a declining path from 77% of GDP in 2013 to 62% by 2022.  That debt continues on a sharp decline from there, as the long term effects of Ryan’s structural entitlement reforms phase in.  Debt held by the public is reduced to 53% of GDP by 2030, 38% by 2040, and 10% by 2050.  That means the national debt is all but paid off by 2050, and would be soon thereafter.  In fact, under dynamic scoring it probably would be paid off by then.

In stark contrast, on our current course, under President Obama’s budget policies, federal debt held by the public rockets to 140% of GDP by 2030, 220%by 2040, and 320% by 2050, on its way to over 700% by 2080.  That would undoubtedly create a Grecian style sovereign debt crisis for America before that point.

So which course will you choose America?

Big Spender - Queen

The minute you walked in the joint
I could see you were a man of distinction,
A real big spender,
Good looking, so refined.
Say wouldn't you like to know what's going on in my mind?

Let me get right to the point,
I don't pop my cork for every girl I see.
Hey, big spender,
Spend a little time with me.