Archive for the ‘Government Spending & Waste’ Category
In Egypt, the Muslim Brotherhood government that Obama arms, funds and supports is violently persecuting religious minorities, using our tax money to do it:
Egypt’s Muslim Brotherhood’s governing majority, is not actually crucifying the nation’s Christians. But they are nonetheless actively persecuting Coptic Christians who are said to be one-tenth of the population of the largest Arab country. A photograph of two young men set afire during recent demonstrations is pretty striking.
Demonstrations have turned into riots as Egypt’s police cracked down on the Copts. The Copts were protesting against increasing sectarian violence directed at the country’s Christian minority.
Typically, what has been happening is the Copts protest against Islamist violence directed at them and their churches. St. Mark’s Cathedral has been the target of Muslim extremists in recent week. When the Copts face police, they get tear gassed. And then they are the ones arrested. The Muslim Brotherhood authorities will pick up Coptic youth—hopefully the ones not yet set on fire—and jail them.
Then, the police grab some of the Islamists perpetrators and jail them. Later, following a much-ballyhooed “reconciliation,” the authorities release all—perpetrators and victims alike.
In Syria, the rebels that the U.S. is supporting – who are trying to overthrow Assad – are Islamic extremists who are threatening to exterminate any Christians left behind who don’t convert to Islam:
Syria’s Christians fear an Islamist takeover should the current government be overthrown. During the ongoing civil war there has been a well-documented rise in the number of salafi-jihadist groups operating in Syria that pose a direct threat to Syria’s Christian community. These militant opposition forces espouse an Islamist ideology, which incorporates elements of Wahhabism and Salafism and whose stated goals and objectives are by definition hostile towards Christians. Firsthand accounts from Syrian Christian refugees in Lebanon reported by award winning investigative journalist Nuri Kino detail the horror in which they described kidnappings, rapes, harassment, theft and other violent reprisals at the hands of Islamist groups.
Those who survived reported “just being Christian is enough to be a target,” disproving theories that violence and kidnapping directed towards Syrian Christians is purely incidental or for economic reasons.
Once again, our taxpayer money is going towards funding Islamic extremism and the suppression of religious liberty.
Last month, M. Stanton Evans pointed out that America’s demographics currently favor the Republicans in future elections:
As shown by demographer Eric Kaufman of the University of London, religious couples across all cultures are for obvious reasons (including but not limited to abortion) having more children per family than are the secular-irreligious, whose birthrates are below replacement — which means a declining population.
“After 2020,” says Kaufman, the devoutly religious of all faiths “will begin to tip the culture wars to the conservative side.”
The liberal-counterculture Democrats will of course continue fighting this war in the schools and through the media, but have only one major demographic weapon to counter the fertility gap that is working relentlessly against them.
That weapon is illegal immigration. As the population trends move steadily conservative, the liberals must bring into the country and enfranchise new voters who will reliably cast Democratic ballots.
That, and that alone, is the real issue in the battle over immigration and why the Democrats are so bent on gaining amnesty for illegals. All the rest is window dressing.
No wonder they’re pushing so hard for amnesty. The question is, why are Republicans so stupidly eager to help them?
How did we get to the point where we not only murder innocent children, but use tax dollars to pay the hit men?
“Indeed I tremble for my country when I reflect that God is just, that his justice cannot sleep forever.” ~ Thomas Jefferson
President Obama offered a defiant defense of government funding for Planned Parenthood Friday and urged the group’s members to help his administration sign up more women for benefits under his besieged health-care law.
The first sitting president to address Planned Parenthood, Mr. Obama accused conservative politicians of trying to “roll back the clock” on abortion rights and health-care services for women.
“They’ve been involved in an orchestrated and historic effort to roll back basic rights when it comes to women’s health,” Mr. Obama told the group’s annual convention in Washington. “When politicians try to turn Planned Parenthood into a punching bag, they’re not just talking about you, they’re talking about the millions of women who you serve. And when they talk about cutting off your funding, let’s be clear, they’re talking about telling many of those women, ‘You’re own your own.’
That is a bold-faced lie. Pro-life groups do more to support and provide services for women in crisis pregnancies than anyone else. And those services don’t involve murdering a child and scarring a woman for life!
Susan B. Anthony List President Marjorie Dannenfelser said Mr. Obama should have reproached Planned Parenthood officials for not doing more to stop the alleged violations at the clinic of Dr. Kermit Gosnell. Planned Parenthood officials in Philadelphia said they encouraged patients who complained to them about the clinic to report it to state authorities.
“President Obama blatantly ignored this inconvenient truth about the abortion industry’s horrific lack of oversight, and disparaged the pro-life advocates who wake up each morning with the goal of saving the lives of unborn children and women from the pain of abortion,” Ms. Dannenfelser said in a statement.
Instead, the president decried efforts across the country to limit women’s access to abortion services.
As he ended his speech, Obama blasphemously called on God to “bless” the largest child murder organization in the country.
“As long as we’ve got to fight to make sure women have access to quality, affordable health care, and as long as we’ve got to fight to protect a woman’s right to make her own choices about her own health, I want you to know that you’ve also got a president who’s going to be right there with you, fighting every step of the way,” said Obama. “Thank you, Planned Parenthood. God bless you.”
Murdering children is NOT health care, and the choice to kill a child is NOT a choice about one’s one health, but to end the life of another human being.
“Woe to those who call evil good and good evil, who put darkness for light and light for darkness, who put bitter for sweet and sweet for bitter.” ~ Isaiah 5:20
Margaret Sanger, the founder of Planned Parenthood, referred to blacks as “human weeds” and “reckless breeders.” Ironic the first black president is the first president to speak to a child killing organization founded by a racist who targeted blacks. KKK should be applauding Obama’s speech today, for they had the same goals as Sanger.
Funny how Marxists don’t recognize your unalienable right to keep the fruits of your labor (especially if you happen to be more successful than they think you should be), but they claim that they have a “right” to demand free goodies at the expense of others.
Speaking outside on a sunny day, Harris-Perry says in an ad that aired Wednesday morning:
Americans will always want some level of inequality, because it’s a representation of meritocracy. People who work hard and sacrifice and save their money and make major contributions — we think that they should earn a little more. They should have more resources, and that’s fine. But we also, however, have to have a floor under which nobody falls. And if you’re below that — especially if you’re a child and you’re below that — we are not going to accept that. You do have the the right to health care, and to education, and to decent housing and to quality food at all times. [Emphasis added]
When something is a “right” (your life or conscience, for instance), it means you don’t have to do anything to earn it. You get to have it just for existing. It’s a gift from your Creator.
When you describe goods and services like food and housing as “rights,” you are saying that the people who produce these goods and services are obligated to provide them for you, whether you pay for them or not. There’s a word for this: slavery. Only slaves are forced to produce for others without compensation. TRUE rights come from God, and are unalienable. They cannot be provided by others, who could just as easily take them away.
You have an unalienable right to work and trade for goods and services. You do NOT have a “right” to demand them free of charge from others.
Welcome to the “new normal” under Obamanomics. In Europe, where Keynesian economics and Democratic Socialism has dominated for decades, unemployment rates are in the 20’s. For the younger generation, they’re even higher. Yet, instead of learning from their mistakes, Obama and the Democrats insist on repeating them. Millions of innocent people are being hurt in the process.
After a full year of fruitless job hunting, Natasha Baebler just gave up.
She’d already abandoned hope of getting work in her field, working with the disabled. But she couldn’t land anything else, either — not even a job interview at a telephone call center.
Until she feels confident enough to send out resumes again, she’ll get by on food stamps and disability checks from Social Security and live with her parents in St. Louis.
“I’m not proud of it,” says Baebler, who is in her mid-30s and is blind. “The only way I’m able to sustain any semblance of self-preservation is to rely on government programs that I have no desire to be on.”
Baebler’s frustrating experience has become all too common nearly four years after the Great Recession ended: Many Americans are still so discouraged that they’ve given up on the job market.
Older Americans have retired early. Younger ones have enrolled in school. Others have suspended their job hunt until the employment landscape brightens. Some, like Baebler, are collecting disability checks.
It isn’t supposed to be this way. After a recession, an improving economy is supposed to bring people back into the job market.
Sadly, until we get rid of Obamanomics, the jobs won’t be coming back. Business aren’t hiring because they never know when they’re going to be hit with a costly new regulation or tax. Entrepreneurs aren’t willing to take the risk to start a new business in such a hostile business climate.
Donald Lambro at Human Events predicts that we’re in for “Four More Years of Pain“:
President Obama heads into the third month of his second term, still unable to find a cure for a sluggish economy, weak employment numbers and his own slipping job approval scores.
Second terms are usually challenging for presidents who have won re-election without having the slightest idea about what they will do over the next four years. And that’s what we are witnessing now with Obama, whose biggest problem is the anemic, job-challenged economy.
[…] The depressing headlines of the past few days tell a sad tale of what the economy is like under his presidency:
– “Weekly Jobless Claims Get Weaker as Outlook Dims” was the gloomy headline over a Reuters news wire story Thursday morning on the CNBC website.
“The number of Americans filing new claims for unemployment benefits rose to its highest level in four months last week, suggesting the labor market recovery lost some steam in March,” Reuters reported.
– “Hiring Is Weaker at Private Companies,” a Washington Post headline blared Thursday.
“Companies hired at the weakest pace in five months in March as recent strong demand for construction jobs evaporated and growth in the vast services sector slowed, signs that the economic recovery could be hitting a soft patch,” the newspaper reported.
That’s the conclusion of the ADP National Employment Report Wednesday, which showed “that private employers added 158,000 jobs last month.” The ADP job survey said “the gain was the smallest since October.”
A separate report Wednesday on the services industry, the economy’s largest job sector, showed that employment growth “pulled back in March.”
You do not hear any of these reports on the nightly TV news because the networks cherry-pick reports that feed the White House line of a continuing economic recovery.
[…] Thankfully, there are economic reporters who resist touting the White House line that everything is rosier under Obama’s policies.
“We’re approaching the four-year anniversary of the economic recovery, and it still doesn’t feel like much of one, what with the unemployment rate at 7.7 percent and wages stagnant over the past five years,” Neil Irwin, the Post’s veteran economic analyst, recently reported.
Obama is so blinded by ideology that the tragic results of his policies on display all around him aren’t enough to convince him that his policies need to change.
Even as the Obama White House prepares for a star-studded White House concert featuring Queen Latifah, Cyndi Lauper, and Justin Timberlake, figures from the U.S. Census Bureau reveal that roughly 50 million Americans—one in six—now live below the poverty line.
Additionally, one in five American children have fallen below the poverty line; the last time poverty levels were this high, Lyndon Baines Johnson was president.
“In the last three years, there’s been a great change in the kinds of people we are serving,” said Director of Community Services at Catholic Charities of Baltimore Mary Anne O’Donnell. “There are increasing numbers of people who owned a home, lost their jobs, end up living in their car and are coming with children to our soup kitchen.”
The U.S. government defines a family of four earning under $23,021 as living in poverty. Income used to compute poverty status does not include non-cash benefits, such as food stamps and housing subsidies.
Welfare program enrollments have exploded under President Barack Obama. Americans on food stamps now outnumber the combined populations of 24 U.S. states, costing taxpayers more than double the amount spent on food stamps five years ago. In January 2009, 31.9 million Americans received food stamps. Today, that figure is 47.79 million.
Boomtown 2: The Business Of Food Stamps
View on YouTube
For the Left, this is all part of the Cloward-Piven strategy to overwhelm the system with impossible demands, bringing about an inevitable collapse that will set the stage for a Communist revolution.
For corporations vying for their turn at the taxpayer trough, this is a dance with the devil…and they don’t even realize it.
“Boomtown 1: Washington, The Imperial City” exposed the cronyism and luxurious lifestyle of Washington, DC’s power elite. On Friday “Boomtown 2: The Business of Food Stamps” Government Accountability Institute (GAI) President Peter Schweizer and Breitbart News Executive Chairman Stephen K. Bannon exposed how politicians and corporations have used the country’s food stamps program to profit on the backs of tax payers.
Though the food stamps program was always meant to be a “safety net” to provide temporary assistance, Schweizer pointed out that it has “become an insider game of power and profit” for corporations who are attempting to get a slice of the $75 billiion provided by the taxpayers.
[…] The GAI president points out that the food stamps program was intended to provide basic foods, but has grown to include all types of things including soft drinks and fast food. We have also pointed out that the food stamps program has been used to purchase guns, drugs and pay for strippers and massage parlors, not to mention that the USDA has targeted illegal aliens for the program.
The fraud of the food stamps program has grown since EBT cards were issued in 2002, which gave no reason for either government or corporations to look to reform the system or limit the fraud.
The Obama administration is proudly shattering welfare records with an astonishing number of people collecting public benefits long term, especially food stamps.
In fact, as I discussed in a special to be aired on Hannity tonight, Obama and his friends have actually found a way to meld corporate cronyism with food stamp abuse to line their pockets while undermining our election systems at the same time.
Under Obama, the Supplemental Nutrition Assistance Program (SNAP), also known as food stamps, has exploded with a record number of people – 46 million and growing – getting free groceries from the American taxpayer. Adding insult to injury, a federal audit revealed last year that many who don’t qualify for food stamps now receive them under a new “broad-based” eligibility program that disregards income and asset requirements.
Obama says the food stamp extension is part of his intention to eradicate “food insecure households.” However, it’s really part of a massive redistribution of wealth. Last year, taxpayers were forced to pay more than $80 billion, including an estimated $750 million a year in outright fraud.
[…] According to the study, the current food stamp Electronic Benefit Transfer (EBT) card industry is dominated by three main players: J.P. Morgan Electronic Financial Services, Affiliated Computer Services, and eFunds. Together they collect money from 49 states and three territories. In fact, since 2004, 18 of 24 states that contract with J.P. Morgan have paid more than $560 million to the financial monolith.
There is little wonder then that those three companies appear to be perfectly content with the exploding food stamp rolls – and wholly unconcerned about rampant fraud and abuse. As the GAI study observed, “The more persons enrolled in the program, the more money the EBT industry makes.” That may also help explain why, when the state of Florida initiated an eight-month program to detect and prevent fraud among its three million EBT card users, J.P. Morgan saw fit to assign just one employee to the program.
And then there is this: During the 2008 election, Barack Obama received more than $800,000 from J.P. Morgan alone. After his election, the American Recovery and Reinvestment Act, initiated by Obama and passed by a compliant Congress, made two major changes to existing food stamp policies. First, it increased benefits by 13.6 percent. Second, it actively encouraged states to add more recipients to their food stamp rolls.
And the corporate cronyism and political payoffs don’t end there. The House and Senate Agricultural Committees have jurisdiction over all food assistance and distribution programs, including the food stamp program. So, just as one might expect, analysis by the GAI uncovered a clear trend of increasing contributions to Agriculture Committee members of both the House and Senate on the part of J.P. Morgan that clearly coincides with their entry into the lucrative EBT card, food stamp market.
Between 1998 and 2002, JP Morgan’s total contributions per election cycle averaged $82,897. After the bank entered the EBT services market until the 2010 election cycle, their average donation per cycle more than doubled to $215,120. And the Agriculture Committees, in turn, have broadly expanded the number of food stamp recipients.
Of course, the more recipients that are added to the food stamp rolls, the more voters Obama can count on at election time. And the offshoots of Obama’s former client and campaign partner ACORN not only assure that those voters are registered but also that they know to whom they are beholden for their government handouts.
ObamaCare provides millions of dollars in grants to hire community activists and others as “navigators” to assist individuals enroll in health insurance provided by state or federal exchanges and, according to recent reports, register people to vote. In a new rule proposed Wednesday, HHS lays out numerous guidelines for these “navigators”, including paying them up to $48/hour for their work. The rule, guidelines and voter registration effort are a potential vehicle to resurrect ACORN or an ACORN-like entity.
[…] Requirements for “navigators” is that they have no existing insurance licenses or certifications, conflicting with several recently enacted state laws. They also must be attuned to racial, ethnic and cultural sensitivities, understand “underserved communities” and provide translation services for virtually every language. AARP, NAACP and SEIU are prominent members of Enroll America’s advisory board.
One health expert with close ties to HHS told Breitbart News, “The navigator program, as evidenced by the leadership of Enroll America and yesterday’s rule from CMS, will be a jobs program for unemployable Obama For America campaign volunteers and ACORN remnants.”
[…] October 1st is the first day individuals can enroll for a program through the exchanges. The government, as a result, will have to hire and train tens of thousands of workers on the complex subject of health insurance over the next few months. Think of it as an enormous census program with less training for a more complex subject.
The rules allow navigators to come from the ranks of unions, health providers and community action groups such as ACORN and Planned Parenthood. They are required to provide unbiased advice.
Yeah, right. Good luck enforcing that!
Obama Proclaims April ‘Financial Capability Month,’ Plans To Teach Young People ‘How to Budget Responsibly’
You can’t make this stuff up! And no, it wasn’t an April Fools joke!
President Barack Obama, who has increased the national debt by $53,377 per household, has proclaimed April“National Financial Capability Month,” during which his administration will do things such as teach young people “how to budget responsibly.”
“I call upon all Americans to observe this month with programs and activities to improve their understanding of financial principles and practices,” Obama said in an official proclamation released Friday.
[…] The proclamation on the White House website links to two other government websites: the site for the Consumer Financial Protection Bureau, and MyMoney.gov, which includes materials from 21 federal agencies.
Listed among the “popular topics” on MyMoney.gov is “Managing Debt and Credit,” which includes a link to a page on the Federal Reserve’s website called “Getting the most from your credit card.” Tip 2 on that page is: “Stay Below Your Credit Limit.”
When Obama was inaugurated on Jan. 20, 2009, the total debt of the federal government was $10,626,877,048,913.08. As of the close of business on March 28, 2013, the total debt of the federal government was $16,766,988,432,792.62—an increase of $6,140,111,383,879.54 since Obama took office.
That means that under Obama the federal debt has increased $53,377 for each one of the 115,031,000 households the Census Bureau says there are now in the United States. The president is required by law to submit a budget proposal for the next fiscal year by the first Monday in February.
Thus far, Obama has not submitted his budget proposal for fiscal 2014.
It’s the liberal way to perceive yourself as diametrically opposed to what and who you actually are. Therefore, Barack Obama being a financially incapable liberal is precisely the reason why the man who has yet to submit a budget proposal for 2014 feels he’s qualified to teach young people “how to budget responsibly.”
What’s next, Bill and Hillary Clinton running a Marital Cohesiveness and Fidelity Seminar? How about first daughters Sasha and Malia, who took not one but two spring break vacations, sharing with the younger set how to spend a week at the Atlantis in the Bahamas and River Run in Sun Valley, Idaho on a limited budget? Sorry, but if Barack Obama is financially capable, then outgoing MSNBC host Ed Schultz is qualified to host a new “Eradicate Bias in the Media” show.
Then again, this is the president who is expert at exempting himself from what he insists others do. That is why a person who clearly has no understanding of sound financial principles can say with a straight face: “I call upon all Americans to observe this month with programs and activities to improve their understanding of financial principles and practices.”
Wait! When Obama says “all Americans” does “all” include himself and the $10 million dollar vacationer he’s married to, or does “all” just mean everybody except Mr. and Mrs. Obama?
Either way, the president must truly believe that he’s an authority on stretching a dollar, because in his “National Financial Capability Month” proclamation, he said that his “[a]dministration is dedicated to helping people make sound decisions in the marketplace.” That marketplace, by the way, is the same marketplace that he’s currently in the process of destroying. It could be that President Obama thinks that the soundest way to save money in the marketplace is to exchange the marketplace for something altogether different.
Planned Parenthood’s primary source of income is abortion. The purpose of their “sex ed” agenda is to encourage kids to experiment sexually and create as many new potential customers as possible. They will bulldoze anybody who dares to get in the way.
Last week, a Portland, Oregon math teacher was led out of his classroom by police and is expected to be fired for his opposition to Planned Parenthood. For years, Benson High School teacher Bill Diss has protested Planned Parenthood of Columbia Willamette (PPCW) building an abortion facility as well as their infiltration into the city’s schools.
This Fall, he refused to allow Planned Parenthood staffers to come into his class to push their agenda, under the auspices of the Teen Outreach Program – why was this interrupting a math class, of all things? – and ever since, the school’s administration (not to mention PPCW) has had it out for him.
Now that PPCW has completed the heroic task of stopping Mr. Diss, they can go back to their very important, regularly scheduled programing – promoting sex toys!
Tonight, as part of “Sexy Tuesdays,” PPCW is offering a “Sex Toy Workshop & Soiree.”
Ladies and gentlemen, THIS is the organization that Benson High School allows access to their students to, even to the point of interrupting class time against the wishes of teachers, and firing educators like Mr. Diss.
Sex toy seminars are just the tip of the iceberg. Planned Parenthood is determined to indoctrinate children as young as 5 with their sexual anarchist ideology:
While the White House says sequestration has eliminated funds for children touring the White House, President Obama has no problem spending $350 million federal tax dollars for sexual indoctrination programs starting in kindergarten for those same children.
This is not your grandmother’s sex education about how things work and what can go “wrong.” In fact, the exact opposite is the essence of the Personal Responsibility Education Program (PREP): Obamacare funnels $75 million annually into PREP, which must be used exclusively for Planned Parenthood-style “comprehensive” sex ed programs where no type of sex is wrong and the only sexual behavior PP considers “unsafe” is becoming pregnant.
More than one-fourth of the funds ‒ $20 million ‒ has been awarded to a coalition of six Planned Parenthood affiliates, operating under the name Northwest Coalition for Adolescent Health, to implement HHS’s TOP program across Montana, Oregon, Idaho, Washington, and Alaska at over 50 sites. In Oregon schools, Planned Parenthood is paying children cash incentives to participate.
PP is funded with our tax dollars to market sex to our children in our schools under the guise of sex education, anti-bullying, diversity, and tolerance. Once sexualized, those children then become PP sex customers for contraceptives, STD testing, and abortion.
In Cyprus, politicians are trying to bail themselves out by stealing directly from people’s bank accounts. In America, the government is more subtle.
It’s been stealing from us for years – through inflation. Thomas Sowell explains:
One of the big differences between the United States and Cyprus is that the U.S. government can simply print more money to get out of a financial crisis. But Cyprus cannot print more euros, which are controlled by international institutions.
Does that mean that Americans’ money is safe in banks? Yes and no.
The U.S. government is very unlikely to just seize money wholesale from people’s bank accounts, as is being done in Cyprus.
But does that mean that your life savings are safe?
No. There are more sophisticated ways for governments to take what you have put aside for yourself and use it for whatever the politicians feel like using it for.
If they do it slowly but steadily, they can take a big chunk of what you have sacrificed for years to save, before you are even aware, much less alarmed.
That is in fact already happening.
When officials of the Federal Reserve System speak in vague and lofty terms about “quantitative easing,” what they are talking about is creating more money out of thin air, as the Federal Reserve is authorized to do — and has been doing in recent years, to the tune of tens of billions of dollars a month.
When the federal government spends far beyond the tax revenues it has, it gets the extra money by selling bonds. The Federal Reserve has become the biggest buyer of these bonds, since it costs them nothing to create more money.
This new money buys just as much as the money you sacrificed to save for years. But more money in circulation, without a corresponding increase in output, means rising prices.
Although the numbers in your bank book may remain the same, part of the purchasing power of your money is transferred to the government. Is that really different from what Cyprus has done?
Through the centuries – in historic cultures like that of Yap Island who used giant, immovable stone disks for commerce, to today’s United States, whose Dollar fiat currency exists primarily in digital form – “money” is able to be exchanged for goods and services because society agrees to accept it (at a certain rate of exchange).
But what happens when a society starts doubting the value of its money?
Fed, the Great & Powerful
The podcast goes into the mind-blowingly simple process by which new money is created in America by the Federal Reserve (or the “Fed”). That is to say:
- The Fed holds a meeting
- Those in the room decide how many more dollars they think the world needs
- Someone walks over to a computer and adds that many dollars to the banks, with a few clicks of the keyboard
The banks then, if they want to, lend this new money out into the economy on a fractional basis, adding even more “thin air” dollars to the nation’s money supply.
This unique ability in America lends the Fed enormous power. The power to create new money from nothing. With no limit.
And with that power, the Fed can control and/or influence economies and markets the world over.
Should such power exist? And if so, should a single private entity owned by the major players in the banking system be allowed to wield it?
Such power certainly has its dangers.
[…] Money is not wealth. It is merely a claim on wealth.
You can’t print your way to prosperity. History is abundantly clear on that.
With the clarity of hindsight, it’s now obvious how the Fed has now painted itself into a corner.
[…] Cyprus has awakened the world to the reality that central planners can appropriate their money with the bang of a gavel. And while we don’t yet know with certainty how things will unfold in Cyprus, we can project that events there have shaken society’s confidence in the soundness of fiat currency in general. If we know it can be confiscated or devalued overnight, we are less likely to unquestioningly accept its stated value. This doubt that strikes at the very foundation of modern monetary systems.
Cyprus is meaningful in the way that it shines a light on both the importance of hard assets and the risk it poses to market stability. It certainly increases the risk of our prediction of a 40%+ stock-market correction by September, as investors begin to realize that current high values are simply the ephemeral effect of too much money, instead of a sign of true value.
At this point, prudence suggests we prepare for the worst (by parking capital on the sidelines, investing in our personal resilience, etc.) and add to our hard asset holdings (like precious metals bullion, productive real estate, etc.) as insurance to protect our purchasing power. The dollar may strengthen for a bit versus other currencies and perhaps the financial markets, but the long-term trend is a safer and surer bet: Dollars will be inflated. There will be more of them in the future than there are today. So, while our dollars still have the purchasing power they do, we should use the window of time we have now to exchange paper money for tangible wealth at today’s prices.
Cyprus is only the first domino.
Cypriot President Nicos Anastasiades has struck a deal with the European Union and International Monetary Fund that will seize up to 40% of uninsured funds from wealthier depositors with over 100,000 euros and will not siphon funds from those below that amount.
The 10 billion euros ($13 billion) bailout plan calls for the Cyprus Popular Bank to be dissolved and all its viable assets transferred to the country’s biggest bank, Bank of Cyprus.
Presently, Cypriot banks have imposed a 100 euros ATM withdraw limit, and Cyprus border officials at air and sea ports have been ordered to confiscate the funds of any traveler attempting to leave with over 10,000 euros.
How dare they try to keep the money they worked so hard for and saved AFTER taxes were already paid on it? Don’t they know that private property is an illusion under Socialism? That the government is free to spend as irresponsibly as it wants, and can steal your money at will to pay the tab? That’s what they’ve been voting for all this time, right? Or didn’t they realize it?
Understandably, Cypriots are desperately trying to get their money out, but it’s too late:
The president of Cyprus assured his people a bailout deal he struck with the European Union was in their best interests, but banks will remain closed until Thursday – and even then subject to capital controls to prevent a run on deposits.
The ruling class insists that stealing money out of their bank accounts is “in their best interests.” Doesn’t that make them feel better? They’ll be patriotic and happy to “share the sacrifice” for the greater good, right? Of course not!
Tyler Durden reports that there is a “Cash Exodus From Cyprus Surges Despite Bank Closures, Capital Controls“:
From FAZ, google translation edited:
Despite the closed banks and a lock for payments in the past week, more money flowed out of Cyprus than in previous weeks, Frankfurter experts report for payments. Prior to the escalation of the crisis in Cyprus accruing on the payment system Target liabilities of Cypriot central bank to the European Central Bank (ECB) had increased daily at approximately 100 to 200 million euros. In recent days was after Parliament the stabilization program initially had to fail, the daily has risen to more than double. Just in the last week so could cash assets have been withdrawn from Cyprus in the billions, although the Cypriot central bank has actually issued a lock.
How is it possible that cash is leaving the country even with a bank halt? It isn’t, unless of course, the banks aren’t really halted, and some outbound wire transfers, which are permitted, are more equal than other wire transfers which are stuck on the island. Of course, that would imply an “Europe Farm” type of arrangement, which in the bastion of fairness, equality and honesty which is Europe, would be absolutely impossible.
On the other hand, if indeed the drain of the Cypriot banking system has continued despite all the enacted halts during the past week, then it’s game over for Cyprus, which will soon have only the ECB to thank for providing liquidity, an arrangement that may not be the best long-term outcome for a nation whose economy has basically been gutted in the span of one week.
It also means game over for the bailout as envisioned, as the EUR17 billion is history, and much more cash will have to be injected to cover for the stealth outflows.
Cyprus won’t be the only one affected, of course. An unusually honest Eurozone official has made it clear that the EU will use the same confiscation tactics as Cyprus if things get worse (which of course they will):
Savings accounts in Spain, Italy and other European countries will be raided if needed to preserve Europe’s single currency by propping up failing banks, a senior eurozone official has announced.
The new policy will alarm hundreds of thousands of British expatriates who live and have transferred their savings, proceeds from house sales and other assets to eurozone bank accounts in countries such as France, Spain and Italy.
The euro fell on global markets after Jeroen Dijsselbloem, the Dutch chairman of the eurozone, told the FT and Reuters that the heavy losses inflicted on depositors in Cyprus would be the template for future banking crises across Europe.
Dijsselbloem tried to retract the statement after investors started panicking, but the damage is already done. Now the cat is out of the bag:
Translation: it now officially sucks to be an unsecured creditor in Europe. In other words: an uninsured depositor.
Why this ad hoc dramatic shift in the European approach to bank solvency, which if anything makes the link between bank and sovereign closer than ever, and crushes all that Draghi achieved in the summer of 2012?
Simple: because what Cyprus allowed was the effective usurpation of democracy – the only reason the Cypriot bailout “passed” (at least so far) is because it was structured as a bank restructuring, a financial system “resolution”, not a tax,and thus not in need of a parliamentary, democratic vote. Because as Cyprus also showed, votes to deprive depositors of cash, whether insured or uninsured, simply won’t fly.
Hence the shift.
However, there is a problem: it means that depositors are now fair game everywhere, and that the ESM or EFSF, with their unlimited scope but “democratic” impleention pathway, are on the backburner.
And now, the scramble to pull uninsured deposits out of banks everywhere begins. Thanks to the new Eurogroup head.
“You ask for miracles, Theo. I give you Diesel-BOOM”
And now, every European depositor is going to their local financial dictionary to look up the definition of General Unsecured Claims, only to see a picture of… themselves.
Simon Black at Sovereign Man blog tells readers to “Expect These Eight Steps From The Government’s Playbook“:
To anyone paying attention, reality is now painfully obvious. These bankrupt, insolvent governments have just about run out of fingers to plug the dikes. And history shows that, once this happens, governments fall back on a very limited playbook:
As Cyprus showed us, bankrupt governments are quite happy to plunder people’s bank accounts, especially if it’s a wealthy minority.
Aside from bank levies, though, this also includes things like seizing retirement accounts (Argentina), increases in civil asset forfeiture (United States), and gold criminalization.
Just another form of confiscation, taxation plunders the hard work and talent of the citizenry. But thanks to decades of brainwashing, it’s more socially acceptable. We’ve come to regard taxes as a ‘necessary evil,’ not realizing that the country existed for decades, even centuries, without an income tax.
Yet when bankrupt governments get desperate enough, they begin imposing new taxes… primarily WEALTH taxes (Argentina) or windfall profits taxes (United States in the 1970s).
This is indirect confiscation– the slow, gradual plundering of people’s savings. Again, governments have been quite successful at inculcating a belief that inflation is also a necessary evil. They’re also adept at fooling people with phony inflation statistics.
Governments can, do, and will restrict the free-flow of capital across borders. They’ll prevent you from moving your own money to a safer jurisdiction, forcing you to keep your hard earned savings at home where it can be plundered and devalued.
We’re seeing this everywhere in the developed world… from withdrawal limits in Europe to cash-sniffing dogs at border checkpoints. And it certainly doesn’t help when everyone from the IMF to Nobel laureate Paul Krugman argue in favor of Capital Controls.
Wage and Price controls
When even the lowest common denominator in society realizes that prices are getting higher, governments step in and ‘fix’ things by imposing price controls.
Occasionally this also includes wage controls… though wage increases tend to be vastly outpaced by price increases.
Of course, as any basic economics textbook can illustrate, price controls never work and typically lead to shortages and massive misallocations.
Wage and Price controls– on STEROIDS
When the first round of price controls don’t work, the next step is to impose severe penalties for not abiding by the terms.
In the days of Diocletian’s Edict on Prices in the 4th century AD, any Roman caught violating the price controls was put to death.
In post-revolutionary France, shopkeepers who violated the “Law of Maximum” were fleeced of their private property… and a national spy system was put into place to enforce the measures.
Despite being completely broke, governments will dramatically expand their ranks in a last desperate gasp to envelop the problem in sheer size.
In the early 1920s, for example, the number of bureaucratic officials in the Weimar Republic increased 242%, even though the country was flat broke from its Great War reparation payments and hyperinflation episode.
The increase in both regulations and government officials criminalizes and/or controls almost every aspect of our existence… from what we can/cannot put in our bodies to how we are allowed to raise our own children.
War and National Emergency
When all else fails, just invade another country. Pick a fight. Keep people distracted by work them into a frenzy over men in caves… or some completely irrelevant island.
Why do we have such massive deficits? Because if the government actually tried to collect the amount it needs to cover its current spending levels and unfunded liabilities, it would trigger a revolt – and that’s not a metaphor.
The truth is that our politicians have been very careful in their labeling of government receipts and payments so as to keep most of the coming bills associated with ‘Take As You Go’ off the books. Consider, for example, Uncle Sam’s promises to pay me my Social Security and Medicare benefits starting in roughly 10 years. The present value (the value in the present) of these promises is $400,000. How does this differ from my holding a Treasury bond valued at $400,000?
Fundamentally, it differs not at all, which means that the government has a lot more debt than it’s reporting.
How much more?
I’m not sure you want to know. I recently calculated the fiscal gap using the CBO’s AFS forecast. The fiscal gap measures the present value difference between all projected future federal expenditures (including servicing official debt) and all projected future taxes. The fiscal gap is thus the true measure of our government’s total indebtedness and the true measure of fiscal sustainability.
How big is the fiscal gap?
Brace yourself. It’s $222 trillion large! In comparison, official debt in the public’s hands is only $11 trillion.
Here’s one way to wrap your head around our $222 trillion fiscal hole: closing it via tax hikes would require an immediate and permanent 64 percent increase in all federal taxes. Alternatively, the government could cut all transfer payments, e.g., Social Security benefits, and discretionary federal expenditures, e.g., defense expenditures, by 40 percent. Waiting to raise taxes or cut spending makes these figures worse.
In short, our government is totally broke. And it’s not broke in 30 years or in 20 years or in 10 years. It’s broke today.
How do we know that a dollar bust is upcoming? The interest we pay on our national debt indicates our future. The interest the United States pays on its debt is now above $350 billion per year. Because more than 43 cents of every dollar the United States spends is now borrowed — and plans are in place to add about a trillion dollars more in debt each year — the interest payment on U.S. debt is expected to climb to a trillion dollars per year in 2017.
In other words, in four years, the interest on the debt will consume almost half of all revenue that the government collects, and each year after that it will get progressively worse — until it consumes all revenues.
As the interest on the debt grows, we won’t be able to borrow enough to pay our bills, and the government will have to either simply print more money to pay up or default. It will likely at least try printing money, and this is when inflation will zoom atmospherically. Even Ben Bernanke, the head of the Federal Reserve, acknowledged this scenario last year.
The chance that the United States will avoid this path in our near future is infinitesimal, but there is a chance. An unexpected business boom could spare us — socialist Norway stays solvent via exploiting oil revenues, and the United States has some of the biggest oil reserves in the world — or a massive downsizing of government could spark a boom — as happened during the Harding administration and at the end of WWII— but there’s little chance of either happening.
The government is issuing smothering business regulations and taxes, and the government will likely run higher debts than projected, not lower.
Debts will likely be higher for many reasons: Not only did the administration fight the minuscule sequester cuts tooth and nail,ObamaCare is much more expensive than promised and will only reduce costs if the death panel lives down to its name, as well as devastating the small businesses that most influence employment. Also, year-in and year-out, Congressional Budget Office figures used to project future tax revenues have predicted a rapidly growing economy and been consistently wrong; the federal flood insurance fund is empty; the Social Security Disability fund is almost empty; etc.
The great majority of U.S. spending is claimed to promote “fairness,” while critics have argued that it is immoral for Baby Boomers — the group mainly responsible for electing political spendthrifts — to heap devastating debt on their children and grandchildren. Ironically, the imminent demise of the dollar has accelerated to where the dollar will almost certainly crash during most Boomers’ lifetimes, so they will have to suffer along with their offspring.
I guess that’s fair.
I’ve heard some liberals excuse Obama’s frequent vacations by saying “Reagan and Bush used to go back to their ranches all the time.” Exactly. Those ranches were their own private property, and the only expense was security. No hotel bills, no lavish parties, no celebrity entertainment, no room service.
The Obamas, on the other hand, choose to vacation in the most expensive accommodations at the most exotic destinations that have NOTHING to do with building foreign relations.
Daniel Halper at the Weekly Standard points out that the first family’s pricey excursions average about once a month:
In the first three months of the year, members of the first family have been on three vacations, averaging a vacation a month. And now it’s being reported that the first daughters are on a spring break vacation in the Bahamas.
The Obamas began the new year in Hawaii. “President Obama departed Hawaii this morning for Washington, after spending NINE days vacationing with family and friends in his native state. Here’s a quick look at how he spent his vacation,” ABC reported on January 6, 2013.
[…] Then the first lady and their daughters vacationed in Aspen over President’s Day weekend. “First Lady Michelle Obama arrived in Aspen on Friday afternoon and is here with her daughters for a ski vacation,” Aspendailynews.com reported in February. “Few details about her trip were available. Sources said she is staying at the home of Jim and Paula Crown, owners of the Aspen Skiing Co. She is reportedly skiing at Buttermilk today, where the Crowns, of Chicago, own a home on the Tiehack side.”
While the rest of the family was in Colorado, Obama went to Florida for a golf weekend. […]
For spring break, Michelle and the girls kicked back at the Atlantis Resort in the Bahamas…at a time when millions of Americans are struggling to make ends meet (thanks to her husband’s policies) and White House tours have been cancelled supposedly due to sequestration:
Even First Daughters Sasha and Malia need a break — a spring break, to be exact — from the White House every once in a while. The sisters and mom Michelle escaped the cold wintry weather of Washington, D.C. in favor of sun and surf in the Bahamas on a recent trip, a source tells Us Weekly exclusively.
The siblings made the most of their vacation at the Reef Atlantis, the source says. In addition to soaking up the sun at the family-friendly cabanas and swimming with dolphins, Sasha, 11, and Malia, 14, also got the chance to dance the night away at CRUSH, Atlantis’ teen club, on Sunday, March 24.
How many children could have gotten to see “the People’s House” this spring break for the cost of the First family’s swanky vacation?
Too bad we can’t afford a vacation this year. We’re too busy busting our butts and paying taxes so the ruling class can go instead.
It’s not a “tax.” It is government stealing money directly out of people’s bank accounts – money that was deposited AFTER taxes were already paid on it.
Socialism = theft, pure and simple. Christians who support Socialism need to go back study what the Bible has to say about debt, envy, and theft!
An 11th-hour deal with the EU, which has saved the Cypriot economy from the brink, will see investors with more than €100,000 in the nation’s largest banks forfeit a large chunk of their deposits.
The punishing deal – which has been approved by the eurozone finance ministers – will allow the country to receive the €10bn (£8.5bn) bailout it needed before the European Central Bank pulled funding and sent the island on the path to bankruptcy and a possible exit from the single currency.
Under the new agreement, all bank deposits under €100,000 will be secured and guaranteed by the state. The country’s second-biggest bank, The Popular Bank of Cyprus – known as Laiki – will be wound down whilst holders of deposits of more than €100,000 face big losses.