The Pronk Pops Show 565, October 30, 2015, Story 1: Budget Busting Bastards of The Republican and Democratic Parties — No Dollar Ceiling on National Debt! — Two Party Tyranny with A Bad Habit — Spending Addiction Disorder (SAD) — America’s Warfare and Welfare Expanding Empire Burdening Future Generations — Videos

Posted on October 30, 2015. Filed under: 2016 Presidential Campaign, 2016 Presidential Candidates, Addiction, American History, Banking System, Blogroll, Bombs, Breaking News, Budgetary Policy, Business, Communications, Congress, Constitutional Law, Corruption, Cruise Missiles, Culture, Defense Spending, Drones, Drugs, Economics, Education, Empires, Employment, Eugenics, European History, Federal Government, Fiscal Policy, Food, Foreign Policy, Free Trade, Gangs, Genocide, Government, Government Dependency, Government Spending, Health, Health Care, Health Care Insurance, History, House of Representatives, Illegal Immigration, Immigration, Independence, Investments, Language, Law, Legal Immigration, Media, Medicare, Middle East, MIssiles, Monetary Policy, News, Nuclear, Philosophy, Photos, Pistols, Politics, President Barack Obama, Progressives, Radio, Raymond Thomas Pronk, Rifles, Scandals, Senate, Social Security, South America, Tax Policy, Taxation, Taxes, Terrorism, Trade Policy, Unemployment, Violence, War, Wealth, Weapons, Weapons of Mass Destruction, Welfare Spending, Wisdom | Tags: , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , |

Project_1

The Pronk Pops Show Podcasts

Pronk Pops Show 565: October 30, 2015

Pronk Pops Show 564: October 29, 2015 

Pronk Pops Show 563: October 28, 2015 

Pronk Pops Show 562: October 27, 2015 

Pronk Pops Show 561: October 26, 2015 

Pronk Pops Show 560: October 23, 2015

Pronk Pops Show 559: October 22, 2015 

Pronk Pops Show 558: October 21, 2015

Pronk Pops Show 557: October 20, 2015 

Pronk Pops Show 556: October 19, 2015

Pronk Pops Show 555: October 16, 2015

Pronk Pops Show 554: October 15, 2015 

Pronk Pops Show 553: October 14, 2015

Pronk Pops Show 552: October 13, 2015 

Pronk Pops Show 551: October 12, 2015 

Pronk Pops Show 550: October 9, 2015 

Pronk Pops Show 549: October 8, 2015 

Pronk Pops Show 548: October 7, 2015 

Pronk Pops Show 547: October 5, 2015

Pronk Pops Show 546: October 2, 2015 

Pronk Pops Show 545: October 1, 2015 

Pronk Pops Show 544: September 30, 2015 

Pronk Pops Show 543: September 29, 2015 

Pronk Pops Show 542: September 28, 2015 

Pronk Pops Show 541: September 25, 2015 

Pronk Pops Show 540: September 24, 2015 

Pronk Pops Show 539: September 23, 2015 

Pronk Pops Show 538: September 22, 2015 

Pronk Pops Show 537: September 21, 2015 

Pronk Pops Show 536: September 18, 2015 

Pronk Pops Show 535: September 17, 2015 

Pronk Pops Show 534: September 16, 2015 

Pronk Pops Show 533: September 15, 2015  

Pronk Pops Show 532: September 14, 2015 

Pronk Pops Show 531: September 11, 2015

Pronk Pops Show 530: September 10, 2015 

Pronk Pops Show 529: September 9, 2015 

Pronk Pops Show 528: September 8, 2015 

Pronk Pops Show 527: September 4, 2015 

Pronk Pops Show 526: September 3, 2015  

Pronk Pops Show 525: September 2, 2015 

Pronk Pops Show 524: August 31, 2015  

Pronk Pops Show 523: August 27, 2015  

Pronk Pops Show 522: August 26, 2015 

Pronk Pops Show 521: August 25, 2015 

Pronk Pops Show 520: August 24, 2015 

Pronk Pops Show 519: August 21, 2015 

Pronk Pops Show 518: August 20, 2015  

Pronk Pops Show 517: August 19, 2015 

Pronk Pops Show 516: August 18, 2015

Pronk Pops Show 515: August 17, 2015

Pronk Pops Show 514: August 14, 2015

Pronk Pops Show 513: August 13, 2015

Pronk Pops Show 512: August 12, 2015

Pronk Pops Show 511: August 11, 2015

Pronk Pops Show 510: August 10, 2015

Pronk Pops Show 509: July 24, 2015

Pronk Pops Show 508: July 20, 2015

Pronk Pops Show 507: July 17, 2015

Pronk Pops Show 506: July 16, 2015

Pronk Pops Show 505: July 15, 2015

Pronk Pops Show 504: July 14, 2015

Pronk Pops Show 503: July 13, 2015

Pronk Pops Show 502: July 10, 2015

Pronk Pops Show 501: July 9, 2015

Pronk Pops Show 500: July 8, 2015

Pronk Pops Show 499: July 6, 2015

Pronk Pops Show 498: July 2, 2015

Pronk Pops Show 497: July 1, 2015

Story 1: Budget Busting Bastards of The Republican and Democratic Parties — No Dollar Ceiling on National Debt! — Two Party Tyranny with A Bad Habit — Spending Addiction Disorder (SAD) — America’s Warfare and Welfare Expanding Empire Burdening Future Generations — Videos

Sen. Cruz: The Budget Deal Is a Corrupt Betrayal of the American People

Rand Paul Speech against Obama’s Debt Deal | Senate Floor CSPAN

Senator Rand Paul speaks on the US Senate floor to speak on President Obama’s debt deal to raise the debt ceiling. Paul will filibuster the debt deal into the morning to hopefully slow down the passing of the debt bill.

Sen. Mike Lee: Budget Deal Is ‘Last Gasping Breath Of A Disgraced Bipartisan Beltway Establishment’

Senate Republicans Who Betrayed The American People by voting YEA:

Screen-Shot-2015-10-30-at-9.34.59-AM

cruz and mcconnell

“Senator McConnell has proven to be the most effective Democratic leader of all time.”

~Senator Ted Cruz

What Pisses Me Off About Government Debt | The Debt Ceiling and Budget Act

Ted Cruz On Debate Performance, Mainstream Media, Budget Deal

Presidential Candidates Ted Cruz, Rand Paul Opposed Budget Bill

Senate votes to pass bipartisan budget deal overnight

Senate Passes 2-Year Budget Deal, Raising The Debt Ceiling – Newsy

Cruz: It’s not two parties, it’s one party; Washington Cartel; 10-29-2015

Clueless Charlie Rose — Obama and Clinton Are Liars! 

CBS’s Charlie Rose Desperately Tries To Lecture Marco Rubio On Benghazi

Following Wednesday night’s CNBC Republican presidential debate, on Thursday’s CBS This Morning, co-host Charlie Rose repeatedly tried to lecture Senator Marco Rubio over Hillary Clinton’s role in the 2012 Benghazi attack. After Rubio stated that he had not engaged in personal attacks throughout this campaign, Rose immediately rushed to defend Clinton and proclaimed that on the issue of Benghazi “[w]ell, well, you called Hillary Clinton a liar, senator. You called Hillary Clinton a liar.”

Hillary_Obama_Poster_Liar

Hillary Clinton: A Lying Compilation

Jim Jordan GRILLS Hillary Clinton About Video

Jim Jordan (R-Ohio) relentlessly questioned former Secretary of State Hillary Clinton on Thursday over why she and other administration officials initially blamed a YouTube video for the Benghazi terror attacks, a claim contrary to available intelligence at the time. “Your experts knew the truth, your spokesperson knew the truth, Greg Hicks knew the truth,” Jordan said during a House Benghazi Committee hearing. “But what troubles me more is I think you knew the truth. Jordan accused Clinton of telling the president of Libya, Egyptian prime minister and even family members that terrorists were behind the attack, but later suggested an anti-Muslim video sparked the attack.
“The American people want to know why,” Jordan added. “If you look at the statement that I made, I clearly said it was an attack,” Clinton replied. “Calling it an attack is like saying the sky is blue — of course it was an attack,” Jordan shot back.

Confirmed: Hillary Clinton Repeatedly Lied Under Oath During Benghazi Committee Hearing

YouTube Video Maker Blamed for Benghazi Attacks Breaks Silence on CNN

Obama and Hillary Blame Youtube Video for Benghazi Terrorist Attack as Coffins Arrive

Hillary Clinton Still Says A Video Was A Factor In The Benghazi Attacks

liars

See How Your Senator Voted on the Boehner-Obama Budget Deal

Less than five days after it was introduced, the Senate passed the 144-page, two-year budget deal that suspends the debt limit until March 2017 and raises spending caps.

The Senate passed the budget deal, 64-35, just after 3 a.m. on Friday. Thirty-five Republican senators opposed the deal, though it was not enough to stop the bill from heading to President Obama’s desk.

Screen Shot 2015-10-30 at 9.34.59 AM

The bill was approved after a 1 a.m. procedural vote which passed, 63-35, and allowed the budget plan to proceed.

The Daily Signal is the multimedia news organization of The Heritage Foundation.  We’ll respect your inbox and keep you informed.

The budget deal, the result of weeks of closed-door negotiations between McConnell, Senate Minority Leader Harry Reid, former House Speaker John Boehner and House Minority Leader Nancy Pelosi, passed the House of Representatives Wednesday night.

The president is expected to sign the two-year budget agreement, called the Bipartisan Budget Act of 2015, within the next few days.

Though the deal passed by the House and Senate with support from members of both parties, the fiscal plan was protested by conservative senators who opposed both the substance of the deal and the manner in which it was negotiated.

Republican Sens. Mike Lee of Utah and Jeff Sessions of Alabama—the current and former chairmen of the Senate Steering Committee, respectively—sent a letter to their GOP colleagues calling on them to oppose the deal. In their message, Lee and Sessions criticized the deal for being “crafted in secret without the involvement of the vast majority of our conference.”

Additionally, Sen. Rand Paul, R-Ky., threatened to filibuster the legislation in what many believed would be an overnight protest. Paul, however, spoke on the Senate floor for just 18 minutes.

The Kentucky senator did appear on the Senate floor later in the night and criticized the deal for giving Obama unlimited borrowing authority.

“Both sides of the aisle have what I would call sacred cows. On the right, they have the sacred cow of military contracts. …The left wants more welfare,” he said, adding, “Should we give Congress more money? Hell no.”

Conservative senators went head-to-head with Republican leadership before the vote.

“The budget deal before the Senate today is not just a horrible piece of legislation that is undeserving of this chamber’s support. It also represents the last gasping breath of a disgraced, bipartisan Beltway establishment on the verge of collapse,” Lee said on the Senate floor. “The bill is a product of an unfair, dysfunctional and fundamentally undemocratic process, a process that is virtually indistinguishable from what we promised the American people a GOP-controlled Congress would bring to an end.”

McConnell, though, stressed that the agreement satisfied the list of demands Republicans had during negotiations with Democrats.

“This agreement isn’t perfect. I share some concerns other colleagues have raised. But here’s the bottom line: this is a fully offset agreement that rejects tax hikes, secures long-term savings through entitlement reforms and provides increased support for our military, all this at a time when we confront threats in multiple theaters,” McConnell said on the Senate floor. “Each of these was a Republican goal heading into negotiations. Each of these items was achieved in the agreement before us.”

The Bipartisan Budget Act of 2015 lifts spending caps by $80 billion—$50 billion in 2016 and $30 billion in 2017—with the increases split evenly between defense and nondefense spending.

It also suspends the debt limit until March 2017, and shifts $150 billion from the Social Security Trust Fund to the Disability Insurance Trust Fund

The budget deal was viewed by Boehner, who resigned from his post earlier this month, as a way to “clean the barn” for his successor, the newly elected Speaker Paul Ryan, R-Wis.

gdp_largeUS_GDP_second_quarter_2015_July2015

quarter-to-quarter-growth-in-real-gdp-2005-2009_q2

spreas of empireCG-map-3bases  US_military_bases_in_the_world_2007globalmilitarism58_14

U.S.Gov_SafetyNetProgramsUS Welfare State

Budget buster: Senate passes debt and spending hike in dead of night

144-page bill amounts to $558 million in new spending per page

Senate Republicans managed to wrangle enough of their troops to overcome a filibuster early Friday morning and pass the new budget deal, granting President Obama yet another debt holiday, busting the budget caps and boosting spending some $80 billion over the next two years.

Democrats, who are far more thrilled with the deal, did the heavy lifting, providing most of the votes as they won some $40 billion in new domestic spending in 2016 and 2017. They also forced the GOP to retreat on the hard-fought 2011 budget agreement that had helped bring deficits back under control.

Conservative Republicans were irate at their leaders and at defense hawks within the GOP who forced the deal by saying it was worth busting the caps in order to get the Pentagon more money at a time when the U.S. is fighting the war on terror.

“This deal represents the worst of Washington culture,” said Rep. Rand Paul, a Kentucky Republican and presidential candidate who’d vowed to lead the filibuster, but who saw his efforts fall short to what he called an “unholy compromise between right and left.”

The bill cleared on a 64-35 vote, with just 18 Republicans joining all Democrats in backing the bill.

President Obama said the deal will “break the cycle of shutdowns and manufactured crises” that he and Congress have been through the last few years.

http://www.washingtontimes.com/news/2015/oct/30/senate-passes-debt-and-spending-hike-dead-night/

Senate passes two-year budget deal

Jim DeMint

When I had just started to raise a family, and I struggled to make my small business turn a profit, I had to make decisions about what bills to pay based on priorities and due dates. Sometimes, the struggle to balance the checkbook would be a painful one, and we had to do without some things as “luxuries”—even if we hadn’t considered them luxuries before.

This wasn’t some unique experience of mine. Too many Americans these days are forced to make sacrifices to keep the lights on.

But the federal government doesn’t do the same—in fact, it rarely even tries. Instead, the impending Boehner-Obama agreement allows Congress to rack up new debt and guarantees even more spending without putting any checks in place.

This is an insult to the American families whose tax dollars pay their salaries. It is slap in the face to families who are forced to shell out for every single irresponsible spending bill and wrecked entitlement system, because their representatives are too cowardly to tighten the belt and work on some hard reforms.

Instead, the current budget deal keeps our government on a trajectory to spend another $7 trillion more over the next 10 years than it will receive in taxes, according to the Congressional Budget Office. So, like clockwork, Congress raises the debt limit.

Just as credit cards have limits that serve as warning signs for reckless spending, the debt limit is Congress’ self-imposed warning sign that our spending problem needs to be addressed. They’ve ignored it to the tune of $18.1 trillion and counting.

The Boehner-Obama deal has gimmicky savings that will not materialize—if ever—until 10 to 15 years from now. It bails out the Social Security Disability Insurance trust fund by robbing the general Social Security Trust Fund without putting in any meaningful reforms. This is no help to the next generation of retirees.

Insultingly, the deal also turns Overseas Contingency Operations (an emergency spending provision that was meant to help the troops) into a slush fund for non-defense spending. If that disgusts you, welcome to the club—your annual dues are paid every April 15.

Congress hasn’t been forced into this. Better options have been proposed, but they require holding to budget caps and building on them with real spending and entitlement reforms.

Until Washington is forced by the voters into fiscal sanity, American families can expect to continue making those painful budget decisions at home while watching their leaders pile more debt on their heads from afar. Unfortunately, government debt will eventually lead to less opportunity and lower quality of life for all Americans.

http://dailysignal.com/2015/10/28/lame-ducks-lame-deal-the-boehner-obama-budget-plan/

EMBARGOED UNTIL RELEASE AT 8:30 A.M. EDT, Thursday, October 29, 2015
BEA 15—50

* See the navigation bar at the right side of the news release text for links to data tables,
contact personnel and their telephone numbers, and supplementary materials.

Lisa Mataloni: (202) 606-5304 (GDP) gdpniwd@bea.gov
Jeannine Aversa: (202) 606-2649 (News Media)
National Income and Product Accounts
Gross Domestic Product: Third Quarter 2015 (Advance Estimate)
      Real gross domestic product -- the value of the goods and services produced by the nation’s
economy less the value of the goods and services used up in production, adjusted for price
changes -- increased at an annual rate of 1.5 percent in the third quarter of 2015, according to the
"advance" estimate released by the Bureau of Economic Analysis.  In the second quarter, real GDP
increased 3.9 percent.

      The Bureau emphasized that the third-quarter advance estimate released today is based on source
data that are incomplete or subject to further revision by the source agency (see the box on page 2 and
"Comparisons of Revisions to GDP" on page 4).  The "second" estimate for the third quarter, based on
more complete data, will be released on November 24, 2015.

      The increase in real GDP in the third quarter primarily reflected positive contributions from
personal consumption expenditures (PCE), state and local government spending, nonresidential fixed
investment, exports, and residential fixed investment that were partly offset by negative contributions
from private inventory investment. Imports, which are a subtraction in the calculation of GDP,
increased.

      Real GDP increased 1.5 percent in the third quarter, after increasing 3.9 percent in the second.
The deceleration in real GDP in the third quarter primarily reflected a downturn in private inventory
investment and decelerations in exports, in nonresidential fixed investment, in PCE, in state and local
government spending, and in residential fixed investment that were partly offset by a deceleration in
imports.

_____

      FOOTNOTE.  Quarterly estimates are expressed at seasonally adjusted annual rates, unless otherwise
specified.  Percent changes are calculated from unrounded data and are annualized.  "Real" estimates are
in chained (2009) dollars.  Price indexes are chain-type measures.

      This news release is available on BEA's Web site.
_____

      Real gross domestic purchases -- purchases by U.S. residents of goods and services wherever
produced -- increased 1.5 percent in the third quarter, compared with an increase of 3.6 percent in the
second.

      Current-dollar GDP -- the market value of the goods and services produced by the nation’s
economy less the value of the goods and services used up in production -- increased 2.7 percent, or
$121.1 billion, in the third quarter to a level of $18,034.8 billion.  In the second quarter, current-dollar
GDP increased 6.1 percent, or $264.4 billion.
Disposition of personal income

      Current-dollar personal income increased $171.6 billion in the third quarter, compared with an
increase of $139.5 billion in the second.  The acceleration in personal income primarily reflected an
acceleration in wages and salaries and an upturn in farm proprietors’ income that were partly offset by a
deceleration in personal interest income.

      Personal current taxes increased $15.8 billion in the third quarter, compared with an increase of
$27.3 billion in the second.

      Disposable personal income increased $155.9 billion, or 4.8 percent, in the third quarter,
compared with an increase of $112.2 billion, or 3.4 percent, in the second.  Real disposable personal
income increased 3.5 percent, compared with an increase of 1.2 percent.

      Personal outlays increased $136.6 billion in the third quarter, compared with an increase of
$182.3 billion in the second.

      Personal saving -- disposable personal income less personal outlays -- was $636.7 billion in the
third quarter, compared with $617.5 billion in the second.

      The personal saving rate -- personal saving as a percentage of disposable personal income --
was 4.7 percent in the third quarter, compared with an increase of 4.6 percent in the second.  For a 
comparison of personal saving in BEA's national income and product accounts with personal saving in the 
Federal Reserve Board's financial accounts of the United States and data on changes in net worth, go to
www.bea.gov/national/nipaweb/Nipa-Frb.asp.

_____

      BOX.  Information on the assumptions used for unavailable source data is provided in a technical note
that is posted with the news release on BEA's Web site.  Within a few days after the release, a detailed
"Key Source Data and Assumptions" file is posted on the Web site.  In the middle of each month, an
analysis of the current quarterly estimate of GDP and related series is made available on the Web site;
click on Survey of Current Business, "GDP and the Economy."  For information on revisions, see
"Revisions to GDP, GDI, and Their Major Components."
_____

      BEA's national, international, regional, and industry estimates; the Survey of Current Business;
and BEA news releases are available without charge on BEA's Web site at www.bea.gov.  By visiting
the site, you can also subscribe to receive free e-mail summaries of BEA releases and announcements.



                                      *          *          *



                       Next release -- November 24, 2015 at 8:30 A.M. EST for:
                   Gross Domestic Product:  Third Quarter 2015 (Second Estimate)
                   Corporate Profits:  Third Quarter 2015 (Preliminary Estimate)


                                      *          *          *

Release dates in 2016

Gross Domestic Product

                 2015: IV and 2015 annual      2016: I            2016: II           2016: III

Advance....            January 29             April 28             July 29          October 28
Second.....           February 26               May 27           August 26         November 29
Third......              March 25              June 28        September 29         December 22


Corporate Profits

Preliminary...            ...                   May 27           August 26         November 29
Revised.......           March 25              June 28        September 29         December 22




                                        Comparisons of Revisions to GDP


	Current quarterly estimates of GDP are released on the following schedule: "Advance" estimates, based on source
data that are incomplete or subject to further revision by the source agency, are released near the end of the first
month following the end of the quarter; as more detailed and more comprehensive data become available,
"second" and "third" estimates are released near the end of the second and third months, respectively.  "Latest"
quarterly estimates reflect the results of both annual and comprehensive revisions, which are typically released in late July.

	Annual revisions generally cover at least the 3 most recent calendar years (and the associated quarters) and
incorporate newly available major annual source data.  Comprehensive (or benchmark) revisions are carried out at
about 5-year intervals and incorporate major periodic source data, as well as improvements in concepts and
methods that update the accounts to portray more accurately the evolving U.S. economy.

	The table below presents the average revisions to the quarterly percent changes in real and current-dollar
GDP for the different estimate vintages.  From the advance estimate to the second estimate (1 month later), the
average revision to real GDP growth without regard to sign is 0.5 percentage point, while from the advance
estimate to the third estimate (2 months later), it is 0.6 percentage point.  From the advance estimate to the latest
estimate, the average revision without regard to sign is 1.2 percentage points.  Larger average revisions for the
latest estimates reflect the fact that comprehensive revisions include major improvements to the accounts, such as
the incorporation of BEA's latest benchmark input-output accounts.  The current quarterly estimates correctly indicate the
direction of change in real GDP 96 percent of the time, correctly indicate whether GDP is accelerating or
decelerating about 75 percent of the time, and correctly indicate whether real GDP growth is above, near, or
below trend growth about 83 percent of the time.


                      Revisions Between Quarterly Percent Changes of GDP: Vintage Comparisons
                                                  [Annual rates]

       Vintages                                   Average         Average without     Standard deviation of
       compared                                                    regard to sign      revisions without
                                                                                         regard to sign

________________________________________________________Real GDP_____________________________________________________

Advance to second....................               0.1                 0.5                  0.4
Advance to third.....................               0.1                 0.6                  0.5
Second to third......................               0.0                 0.2                  0.3

Advance to latest....................              -0.1                 1.2                  1.0


____________________________________________________Current-dollar GDP_______________________________________________

Advance to second....................               0.1                 0.5                  0.4
Advance to third.....................               0.2                 0.7                  0.5
Second to third......................               0.1                 0.3                  0.3
Advance to latest....................               0.1                 1.3                  1.0

_____________________________________________________________________________________________________________________
 NOTE.  These comparisons are based on the period from 1993 through 2014.

http://www.bea.gov/newsreleases/national/gdp/gdpnewsrelease.htm

Fiscal Year 2015, Budget Deficit $438,889,000,000 or $438 Billion

National Debt Clock

$18,425,566,000,000 Plus or $18.4 Trillion

national_debt_chart2014totalusdebtobligationsUS-Unfunded-Liabilities

Overdose: The Next Financial Crisis

America’s Debt Crisis Explained

Published on Feb 24, 2014

Fact: America’s national debt stands at $17 trillion. That’s a tough number to grasp. Most people will never come close to making $1 million in any given year. How can we understand the magnitude of the hole our country is in? Well, imagine you owed your credit card company $200,000. On top of that you have to pay them about $4,000 per year in interest. You are bringing in $150,000 per year, but you are spending way more than that. How are you going to ever pay back that $200,000 debt? And what happens if you default? Well, that is America today.

‘US hides real debt, in worse shape than Greece’

The US national debt is twenty times higher than is officially reported, approaching $222 trillion, and today’s children could soon be paying their parent’s debts, reputed American economist Laurence Kotlikoff told RT. TRANSCRIPT of the interview: http://on.rt.com/81u1ac

How Big Is the U.S. Debt?

Uploaded on Feb 11, 2011

Do you know how much debt the U.S. is really in? Learn more: http://bit.ly/1HVAtKP

Economics professor Antony Davies illustrates the size the U.S. federal government’s debt and unfunded obligations. He breaks down the total U.S. debt and obligations into parts and compares them with the size of the GDP of countries around the world, showing the magnitude of America’s fiscal situation.

Deficits, Debts and Unfunded Liabilities: The Consequences of Excessive Government Spending

Uploaded on May 10, 2010

Huge budget deficits and record levels of national debt are getting a lot of attention, but this video explains that unfunded liabilities for entitlement programs are Americas real red-ink challenge. More important, this CF&P mini-documentary reveals that deficits and debt are symptoms of the real problem of an excessive burden of government spending. http://www.freedomandprosperity.org

I.O.U.S.A.: Byte-Sized – The 30 Minute Version

Uploaded on Oct 31, 2008

By now, you may have heard about our acclaimed documentary I.O.U.S.A., a film that boldly examines the rapidly growing national debt and its consequences for the United States and its citizens. The film has been a huge hit, getting rave reviews from Roger Ebert and others.

Now, we proudly release a 30-minute condensed version of I.O.U.S.A. designed specifically for watching and sharing on the web – for free.

IOUSA Solutions: Part 1 of 5

The award-winning documentary I.O.U.S.A. opened up America’s eyes to the consequences of our nation’s debt and the need for our government to show more fiscal responsibility. Now that more Americans and elected officials are aware of our fiscal challenges, the producers of I.O.U.S.A. created I.O.U.S.A.: Solutions, a follow-up special focusing on solutions to the fiscal crisis. Learn more athttp://www.iousathemovie.com/.

IOUSA Solutions: Part 2 of 5

IOUSA Solutions: Part 3 of 5

IOUSA Solutions: Part 4 of 5

IOUSA Solutions: Part 5 of 5

FIAT EMPIRE: Why the Federal Reserve Violates the U.S. Constitution

$205 Trillion in Unfunded Liabilities

By Gary North

The nonpartisan Congressional Budget Office is acting in a bipartisan way to cover up the biggest single threat to the bipartisan political alliance that is stripping America of its wealth: the United States Congress.

There is no question that the following policy is bipartisan. Democrats and Republicans in Congress are completely agreed that the following information should not get out to the American people, namely, that the present value of the United States government’s off-budget liabilities is over $200 trillion.

…the government needs $205 trillion… to invest in the private sector, in order to fund its legal liabilities.

The man who has followed this for the longest time is Prof. Laurence Kotlikoff of Boston University. He has created a great deal of embarrassment for the government by his relentless pursuit of the statistical implications of the statistics released by the Congressional Budget Office.

The Congressional Budget Office has a way to avoid this, namely, to cease publishing the statistics that Kotlikoff has used to expose the real condition of the United States government.

Kotlikoff referred to this suppression of information in an article that appeared in Forbes.

The CBO has two sets of books. This is what any Ponzi scheme requires. It releases one set of books to the rubes in the financial media, who are perfectly content to quote from it, when they are even aware of it. This is called the Extended Baseline Forecast or EBF.

The second set of books is called the Alternative Fiscal Scenario or AFS. Here’s how Kotlikoff describes the difference.

In past years, the CBO simultaneously released what it calls its Alternative Fiscal Scenario. This forecast is what CBO actually projects future taxes and spending to be given not just the laws in place, but also how Congress and the Administration have been bending and changing the laws through time. In short, the Alternative Fiscal Scenario (AFS) is what the CBO thinks we’re facing absent a truly dramatic and sustained shift in fiscal policy.

Because of Kotlikoff’s ability to get news coverage for the AFS, the CBO decided this year not to publish it.

Those of us who track U.S. fiscal policy eagerly await each year’s release of the AFS. But this year, the CBO’s long-term forecast included only the EBF. The AFS was nowhere to be seen. It wasn’t mentioned in the CBO’s lengthy report. Nor was it included in the downloadable data CBO provided on its website.

The national media, which generally “covers” fiscal affairs by repeating what it’s told, missed this omission entirely. Indeed, it spent an entire news cycle discussing the EBF figures as if they had real meaning.

The CBO did not get away with this, at least not to the extent that it had hoped. There were complaints. Kotlikoff says that enough people did complain to persuade the CBO to release a summary of the projections in an obscure spot in the CBO’s spreadsheet. The CBO posted this information, but it did not alert the financial media to the update.

He predicted that the link would soon be removed. This was in early October.

The EBF and AFS projections differ dramatically, yet the AFS is hidden away in one tab of one spreadsheet called Supplementary Data, the small link to which will shortly disappear from the CBO’s homepage, making it even harder for we taxpayers to find.

He was correct. It’s gone. It’s “page not found.”

[Ed. Note: We tried accessing the link, but nothing came up.]

He points out that the CBO’s projections on the deficit which it has posted in full public view, namely, the ESB, has the fiscal gap at $47 trillion. Now, just between you and me, $47 trillion is a large chunk of change. But it is such a low-ball estimate that the public has no real conception of how big the liability really is. Of course, the public doesn’t care one way or the other, because the public has never heard of the CBO, let alone the ESB. When I say “public,” I mean the financial media.

Using the AFS figures, the unfunded liability is $205 trillion. This is the figure that the CBO does not want the general public, meaning the financial media, to be aware of.

Understand, this is not the unfunded liabilities added up in all future years. This is the present value of the unfunded liabilities, discounted to today. This means that the government needs $205 trillion, cash on hand, to invest in the private sector, in order to fund its legal liabilities. This is not the deficit long after we are dead. This is the present value of the deficit long after we are dead.

The only fiscal measure that’s free of this classification problem, known as economics labeling problem, is what economists call the infinite horizon fiscal gap. This measure puts everything on the books — all future spending obligations, whether they are called official or not as well as all future tax and other receipts. The difference valued in the present (the present value) of future spending less future receipts is the infinite horizon fiscal gap.

Kotlikoff explains this in layman’s terms. He explains it in terms of the taxing and spending consequences of the present value of the unfunded liabilities. He tells us what must be done today.

The $205 trillion fiscal gap is enormous. It’s 10% of the present value of all future GDP. Equivalently, it corresponds to 10% of GDP year in and year out for as far as the eye can see. To raise 10% of GDP each year we could (a) raise all federal taxes, immediately and permanently, by 57%, (b) cut all federal spending, apart from interest on the debt, by 37%, immediately and permanently, or (c) do some combination of (a) and (b).

The odds of Congress agreeing on a bill to this effect, and then having President Obama sign this bill into law, are a good deal lower than the odds of your winning the state lottery. Three times in a row. One ticket per year.

This is the softcore version that he wrote for Forbes. He released a hard-core version in an interview on the Financial Sense website. He called this a conspiracy. But he made it clear that it is a bipartisan conspiracy.

I sent him [head of the CBO] an email and asked whether he was under some sort of political pressure to withhold this information and he said that was a big insult, and he was very upset with me for suggesting that. But then he said that the reason he hadn’t released it was because they didn’t think anyone was interested. I said, well obviously we’re interested — it’s the only thing worth looking at.

I love it when bureaucrats cover up the obvious. They do not even try to be clever. They give some obviously screwball explanation, and leave it at that. They cannot be fired. We cannot do anything about it.

This has gone on for a long time.

This is a pattern, you know. The Clinton administration — we put out the fiscal gap studies for a couple of years on the President’s budget. The Clinton administration then censored it. The guy who’s now head of the National Economic Council, the Chief Economic Advisor to President Obama, was the one who did the censorship back in 1994. President Bush’s Treasury Secretary O’Neil wanted us to do a fiscal gap accounting for the President’s budget in 2003 and he was fired in December 7, 2002, and that study was censored two days after he was fired.

So, this is not accidental. This is more or less a conspiracy to hide the truth to keep ourselves and our kids in the dark about what the politicians are really doing, which is trying to garner the votes of older people and then get reelected and leave a bigger mess for our kids to handle.

Our kids will handle this effectively. They will elect people to Congress who will vote to stop paying the oldsters and their physicians, the vast majority of whom will be dependent on Medicare payments. I call this “stiff the geezers.” I also call it the Great Default. The surviving generations that ran up the liabilities will bear the brunt of the pain, as well they should.

There is no way out, other than default. This will have profound consequences politically, economically, and socially. It will be the end of the Keynesian welfare state. The Keynesians will be left holding the empty bag.

This is how all Ponzi schemes end. But those deluded souls who buy into them refuse to face statistical reality until the scheme blows up, leaving them empty-handed.

Will they be wiser after the Great Default? It is our job to explain to them what happened. We must begin with this: “We told you so. We also told you why.”

Regards,

Gary North
for The Daily Reckoning

You Think The Deficit Is Bad? Federal Unfunded Liabilities Exceed $127 Trillion

By Vance Ginn

Although the battle over a two-year budget deal and the national debt limit in Washington, D.C. has received the lion’s share of media attention recently , the bigger, more ominous threat facing taxpayers are unfunded liabilities—the difference between the net present value of expected future government spending and the net present value of projected future tax revenue, particularly those associated with Social Security and Medicare.

While federal unfunded liabilities are important, state-level unfunded pension liabilities also pose serious obstacles. In Texas, the recent 2013 Employees Retirement System (ERS) Valuation Report outlines the funding shortages this pension system faces and there is some indication it may be unable to pay beneficiaries by 2052.

The federal unfunded liabilities are catastrophic for future taxpayers and economic growth. At usdebtclock.org, federal unfunded liabilities are estimated at near $127 trillion, which is roughly $1.1 million per taxpayer and nearly double 2012’s total world output.
With about 134,000 active members in Texas’ ERS at the end of fiscal year 2013, the total unfunded liability was $7.2 billion—or $54,000 per active member. Despite the much smaller future net debt obligations in ERS compared with federal programs, there are similarities how we got here.

Laurence Kotlikoff and Scott Burns’ book entitled The Coming Generational Storm: What You Need to Know About America’s Future argue federal unfunded liabilities are primarily from a generational accounting problem, in which the dependency ratio of retirees to taxpayers is declining from an aging population.

The authors’ state, “today there are about 4 payees for every 1 beneficiary, but by the year 2030 there will only be 2 payees for every 1 beneficiary. Simple arithmetic will note that this is not sustainable over the long run.”

To understand the magnitude of this problem, the authors note one solution that includes all the following: “raise income taxes by 17 percent, raise payroll taxes by 24 percent, cut federal purchases by 26 percent, and cut Social Security and Medicare benefits by 11 percent.”

In the current political and economic environment, these changes are highly unlikely, but it shows the substantial economic costs associated with these large unfunded liabilities.

State pensions across the country also face this generational accounting problem, whereby an author discusses his research in a recent Wall Street Journal op-ed entitled “The Hidden Danger in Public Pension Funds” stating, “The ratio of active public employees to retirees has fallen drastically, according to the State Budget Crisis Task Force. Today it is 1.75 to 1; in 1950, it was 7 to 1. This means that a loss in pension investments has three times the impact on state and local budgets than 40 years ago.”

In addition to an aging population in Texas creating substantial challenges with funding ERS, it is also riddled with a problem many state pension portfolio managers face: low rates of return on risk-free assets, such as a one-year Treasury security that returns less than 1 percent.

As these managers choose riskier investments to gain a higher rate of return, the study cited in the WSJ op-ed notes that the standard deviation of public pension investments to state and local budgets—a good measure of risk—has increased 10-fold from about 2 percent in 1975 to 20 percent today. Along with fewer people contributing to these pensions, riskier investments should be of grave concern to all.

Since the actuarial funded ratio of ERS is 77 percent based on an 8 percent annual rate of return, this rate of return and the risk-taking portfolio managers must use to gain this return are vital. Over the last five years, the fund’s annual return was 6 percent and 7.1 percent over the last ten years. Although the ten-year annual average was close to 8 percent, there is no guarantee this will continue, which could dramatically lower the funded ratio.

Clearly, the generational accounting problem burdening programs at the federal level also burden Texas’ pensions and the more risky assets portfolio managers must invest in are increasing the susceptibility of an even lower funded ratio in the future.

http://www.forbes.com/sites/realspin/2014/01/17/you-think-the-deficit-is-bad-federal-unfunded-liabilities-exceed-127-trillion/

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