Black People : Bail out and fatten Wall street, but FREEZE out Main street???

Discussion in 'Black People Open Forum' started by Ankhur, Jan 26, 2010.

  1. Ankhur

    Ankhur Well-Known Member MEMBER

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    The Huffington Post January 26, 2010



    Y| HuffPost Reporting Become a Fan Get Email Alerts from this Reporter Obama To Propose Major Spending Freeze Saving $250 Billion
    First Posted: 01-25-10 08:58 PM | Updated: 01-25-10 10:15 PM

    President Barack Obama will propose a three-year freeze in discretionary, "non-security" spending as part of a budget he will unveil one week from now, a senior administration official told the Huffington Post and other reporters Monday evening.

    The president will unveil the proposal during his State of the Union address on Wednesday and will describe it as saving $250 billion over 10 years, relative to what spending on those programs would have been otherwise. His goal is to keep the budget for the affected agencies at or below the $447 billion that was spent on them this past year.

    "We face the dual challenges of a massive GDP gap and also very substantial budget deficits out over time," said the administration official. "As we move forward to FY2011 that's a transition year in which we need to be shifting our focus, making sure we're getting as much as we can from each dollar that the federal government has. And this is not the end-all-be-all, but it is an important category of restoring discipline to an important component of the budget."

    The spending freeze is likely to meet with tepid support among the president's fellow Democrats, many of whom view self-imposed limitations as risky politics and policy at a time of deep economic recession. Last week, House lawmakers -- who will essentially have a larger role than the president in assuring that the spending freeze is implemented -- rejected the proposal after it was initially floated. One Democratic strategist jokingly quipped that the president was taking a page out of the Republican playbook for the sole purpose of placating his Republican critics.

    "So we already know Obama has now taken the McCain campaign's health care position on the excise tax," the strategist said. "Wasn't a freeze in discretionary spending also McCain's plan for when the economy tanked?"

    The senior administration official did not address these concerns directly. But in a 15-minute conference call with half a dozen reporters from online outlets, he did state that the White House "may well" pursue additional "jobs-related" legislation in 2010. As for the agencies that would now have to deal with spending limits -- the EPA, Commerce Department, Health and Human Services, and the Department of Interior to name a few -- the administration official noted that there would be some budgetary flexibility should emergencies arise. If more money is needed at one agency it can go there, but only at the expense of another.

    "This is not a blunt across-the-board freeze," said the senior administration official. "Some agencies will go up, others will go down; but in aggregate for those non-security agencies the total will remain constant."

    Exempt from the limits will be security and defense agencies, whose budgets will undoubtedly rise in the years ahead as the president pursues an aggressive foreign policy agenda. Asked whether the administration is concerned that the deficit reduction pursued by freezes on "non-security" spending would be wiped out by increases in military spending, the administration official said that the White House had and would continue to pursue budgetary discipline in the area of national defense.

    "I think it's worth separating money for the troops from the procurement budget. We will be funding the troops to the degree that is necessary to the degree that they are adequately protected," the official said. "But then, for example, on the procurement part of the budget, within the DoD, [we are] continuing to try and achieve more efficiencies."

    The official added that the discretionary "non-security" spending freeze was just the first bite of the apple when it came to the administration's efforts to rein in government spending. "You're going to see other components of deficit reduction strategy when we release the budget," the official said, noting earlier that if all goes to plan, by 2015 the administration will have brought this category of spending to its lowest point (as a share of the economy) in 50 years.

    http://www.huffingtonpost.com/2010/01/25/obama-to-propose-major-sp_n_436285.html?view=print
     
  2. Ankhur

    Ankhur Well-Known Member MEMBER

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    What Should We Make of Obama’s “Spending Freeze”
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    Washington’s Blog
    January 27, 2010

    The big news today is Obama’s proposed “spending freeze”.




    Obama talks about a government spending freeze, January 25, 2010.

    Fiscal liberals say this cuts spending at the exact time that we most need to increase it. See this and this.

    Fiscal conservatives say this doesn’t go nearly far enough. See this, this and this.

    But I think there’s a bigger issue that deserves some inquiry: is America being turned into a third world country?

    As I wrote last June:

    When the International Monetary Fund or World Bank offer to lend money to a struggling third-world country (or “emerging market”), they demand “austerity measures“.

    As Wikipedia describes it:

    In economics, austerity is when a national government reduces its spending in order to pay back creditors. Austerity is usually required when a government’s fiscal deficit spending is felt to be unsustainable.

    Development projects, welfare programs and other social spending are common areas of spending for cuts. In many countries, austerity measures have been associated with short-term standard of living declines until economic conditions improved once fiscal balance was achieved (such as in the United Kingdom under Margaret Thatcher, Canada under Jean Chrétien, and Spain under González).

    Private banks, or institutions like the International Monetary Fund (IMF), may require that a country pursues an ‘austerity policy’ if it wants to re-finance loans that are about to come due. The government may be asked to stop issuing subsidies or to otherwise reduce public spending. When the IMF requires such a policy, the terms are known as ‘IMF conditionalities’.

    Wikipedia goes on to point out :

    Austerity programs are frequently controversial, as they impact the poorest segments of the population and often lead to a wider separation between the rich and poor. In many situations, austerity programs are imposed on countries that were previously under dictatorial regimes, leading to criticism that populations are forced to repay the debts of their oppressors.


    A d v e r t i s e m e n t

    What Does This Have to Do With the First World?

    Since the IMF and World Bank lend to third world countries, you may reasonably assume that this has nothing to do with “first world” countries like the US and UK.

    But England’s economy is in dire straight, and rumors have abounded that the UK might have to rely on a loan from the IMF.

    And as former U.S. Comptroller General David Walker said :

    People seem to think the [American] government has money. The government doesn’t have any money.

    Indeed, the IMF has already performed a complete audit of the whole US financial system, something which they have only previously done to broke third world nations.

    Al Martin – former contributor to the Presidential Council of Economic Advisors and retired naval intelligence officer – observed in an April 2005 newsletter that the ratio of total U.S. debt to gross domestic product (GDP) rose from 78 percent in 2000 to 308 percent in April 2005. The International Monetary Fund considers a nation-state with a total debt-to-GDP ratio of 200 percent or more to be a “de-constructed Third World nation-state.”

    Martin explained:

    What “de-constructed” actually means is that a political regime in that country, or series of political regimes, have, through a long period of fraud, abuse, graft, corruption and mismanagement, effectively collapsed the economy of that country.

    What Does It Mean?

    Some have asked questions like, “Is the goal to force the US into the same kinds of IMF austerity programs that have caused riots in so many other nations?” Some predicted years ago that the “international bankers” would bring down the American economy.

    I used to think, frankly, that such kinds of talk were crazy-talk. I’m not so sure anymore.

    Catherine Austin Fitts – former managing director of a Wall Street investment bank and Assistant Secretary of the Department of Housing and Urban Development (HUD) under President George Bush Sr. – calls what is happening to the economy “a criminal leveraged buyout of America,” something she defines as “buying a country for cheap with its own money and then jacking up the rents and fees to steal the rest.” She also calls it the “American Tapeworm” model, explaining:

    [T]he American Tapeworm model is to simply finance the federal deficit through warfare, currency exports, Treasury and federal credit borrowing and cutbacks in domestic “discretionary” spending …. This will then place local municipalities and local leadership in a highly vulnerable position – one that will allow them to be persuaded with bogus but high-minded sounding arguments to further cut resources. Then, to “preserve bond ratings and the rights of creditors,” our leaders can he persuaded to sell our water, natural resources and infrastructure assets at significant discounts of their true value to global investors …. This will be described as a plan to “save America” by recapitalizing it on a sound financial footing. In fact, this process will simply shift more capital continuously from America to other continents and from the lower and middle classes to elites.

    Writer Mike Whitney wrote in CounterPunch in April 2005:

    [T]he towering [U.S.] national debt coupled with the staggering trade deficits have put the nation on a precipice and a seismic shift in the fortunes of middle-class Americans is looking more likely all the time… The country has been intentionally plundered and will eventually wind up in the hands of its creditors This same Ponzi scheme has been carried out repeatedly by the IMF and World Bank throughout the world Bankruptcy is a fairly straightforward way of delivering valuable public assets and resources to collaborative industries, and of annihilating national sovereignty. After a nation is successfully driven to destitution, public policy decisions are made by creditors and not by representatives of the people …. The catastrophe that middle class Americans face is what these elites breezily refer to as “shock therapy”; a sudden jolt, followed by fundamental changes to the system. In the near future we can expect tax reform, fiscal discipline, deregulation, free capital flows, lowered tariffs, reduced public services, and privatization.

    full article;
    http://www.infowars.com/what-should-we-make-of-obamas-spending-freeze/
     
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