Budget War Threatens America’s Survival
Greg Hunter’s USA Watchdog.com
President Barak Obama gave a speech to newspaper executives about the recently passed Republican budget in the House of Representatives. It proposes to cut spending by more than $5 trillion over the next ten years. Yesterday’s speech was, basically, a declaration of war against the GOP and its vision of the government’s budget. The President said, “This Congressional Republican budget is something different altogether. It is a Trojan horse disguised as deficit reduction plans. It is really an attempt to impose a radical vision on our country. It is thinly veiled social Darwinism. It is antithetical to our entire history as a land of opportunity and upward mobility for everybody who is willing to work for it. A place where prosperity doesn’t trickle down from the top but grows outward from the heart of middle class.” (Click here for the full transcript of President Obama’s speech.)
It didn’t take long for the Republicans to fire back. The AP reports, “House Speaker John Boehner said Obama is resorting to ‘distortions and partisan potshots’ — while standing behind policies that the speaker says ‘have made our country’s debt crisis worse.’ And a Mitt Romney spokeswoman says Obama’s in no position to lecture about ‘responsible federal spending.” (Click here for more from the AP.) Folks, it is officially “game on,” and every American should be scared speechless about this budget showdown. It is unlike any the nation has ever faced.
The country has never been more in debt, and this comes at a time when countries like China are shunning U.S. Treasuries. There are more than 12 million “officially unemployed.” (The unofficial is 22 million.) Home prices are falling despite near record low mortgage rates. The BRICS nations are actively seeking an alternative to the U.S dollar for settlement of trade, which could threaten the dollar’s reserve currency status. We are threatening financial war with any country that trades with Iran, and the nation is facing yet another shooting war in the Middle East. The only question is will it come before or after the election.
Last August, Congress raised the debt ceiling by $2.1trillion in exchange for at least $2.1 trillion in budget cuts over the next 10 years. A so-called “Super Committee” of Democrats and Republicans was supposed to agree on a deficit reduction plan, but they couldn’t agree on a single dime of spending cuts or tax increases. That’s right, the deficit was not cut, but the nation went in the hole by another $2.1 trillion. Currently, the deficit is more than $15.6 trillion, and the debt ceiling stands at nearly $16.4 trillion. (Click here to see the U.S. debt clock.) Some predict the U.S. will hit the debt ceiling or, better put, run out of money by September 2012— two months before the November election. Zerohedge.com charted the trajectory of the nation’s debt a few weeks ago. 
Can you see the budget battle shaping up in this election year? Republicans will want deep cuts to social programs and not a lot of tax increases. Democrats will want tax increases and to minimize cuts to social programs. Neither side wants to give an inch, especially in an election year. This is the exact same deadlock that took shape last year. Now, both sides want to play political football with the nation’s finances, and the country is running out of time to get its financial house in order before we suffer the same fate as Greece. This will be a monumental budget battle that may crush the nation as we know it. I think it is a safe bet the next increase to the debt ceiling will be in the neighborhood of $2 trillion.
In the aftermath of the budget battle last year, the credit rating of the U.S. was downgraded. There is no doubt it will be downgraded again. Only this time, will the government, also, be shut down? Will the dollar tumble in value? Will the present administration take the money of federal retirement accounts to keep the country from falling into the black hole of insolvency? Will the 47 million people on food stamps be cut off? Will the stock market crash? Will the government stop paying some or all of its bills? Will this turn into a national security issue? Will enemies of the U.S. attack while the donkeys and elephants play chicken with the lives and fortunes of more than 300 million Americans? Will the coming budget war threaten America’s survival? The answer to these questions may all be YES, and no one should be under the illusion that this nightmare could not become reality. I’ve said it before, and I’ll say it again: The country needs statesmen, but what we have are bagmen who are pandering to the special interests that fund them.
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About the Author
Greg Hunter
Greg is the producer and creator of USAWatchdog.com. The site’s slogan is “analyzing the news to give you a clear picture of what’s really going on.” The site will keep an eye on the government, your financial interests and cut through the media spin. USAWatchdog.com is neither Democrat nor Republican, Liberal or Conservative. Before creating and producing the site, Greg spent nearly 9 years as a network and investigative correspondent. He worked for ABC News and Good Morning America for nearly 6 years. Most recently, Greg worked for CNN for shows such as Paula Zahn Now, American Morning and various CNN business shows.
It would seem that for the past few months the President has been showing his true colors. Gone is his fluffy marketing of hope and change, teachable moments, and beer summits. Nowadays we get “Pass This Bill!,” and “Trayvon was my son too.” His crackdown on civil liberties has been swift and extreme. His taunting of Supreme Court judges as “unelected” is unprecedented, and he mocks them even as two of the nine are his own appointees! After three years, this guy is tired of pretending, and now America is seeing exactly who they voted for, and are likely to be stuck with for another four years as the Republican Party implodes.
As for the defecit, you provide an accurate analysis. No one wants to compromise and risk losing face, or actually cut anything and risk losing votes and the cushy jobs that they provide. But the problem really goes beyond that. There is no practical way to repay the debt. Taxing the rich at 100% won’t do it, neither will cutting everything except for entitlements. As the politicians know this, the goal is now only about positioning themselves to deflect the blame when the average American finally gets wise to this fact. The debt is the biggest hot potato in modern history and no one in Washington wants to be caught holding it when the music stops.
Thank you Serapis and Sean S for the pointed comments.
Greg
Well said Greg – as usual.
No the country will not go the way of Greece because, as you know, unlike Greece, the Government will continue to be able to issue Treasury debt securities which will be purchased in large volumes by the Fed by way of issuing additional currency. So the USD money supply will continue to be diluted in this way and it’s value/purchasing power will continue to diminish significantly.
Does this really worry most US Federal politicians. Apparently not. At the end of the day they did not stand in the way of the last debt ceiling increase and the “super committee” was seemingly a total farce in the congressional style. Despite the posturing, they all know only too well that there will be pressure for another debt ceiling increase which – you just wait – ultimately won’t be blocked either.
There is one revenue budget that almost all Politicians are much more concerned about than anything else on their plate. It takes priority over working hard to place the country on a long term stable/sustainable financial footing. This budget is called …………campaign contributions.
Greg,
You are looking at this the wrong way. In a previous response I had made the comment that “we weren’t uncomfortable enough to change anything.”. This is exactly the type of idiotic behavior we need to occur and hopefully follow through to all of the above scenarios you listed. If all of the above occur then maybe, just maybe the people will be galvanized enough to force some real “change we can believe in”. Let them them play chicken, let them use us as political chess pieces. Only then will they see how fast the pitchforks come out and how sharp they really are.
Steve
P.S. I am not trying to incite a revolt but merely pointing at the scenario of taking away the last thing that anybody has and how it could result in an uprising.
Stephen Clifton,
Understood,thanks for weighing in.
Greg
Stephen,
Unfortunately; there is much truth in your comment.
People will live in denial, until such a time that they have ‘NO’ other choice.
Too many questions and not enough solutions. The cards are stacked too high against the American people. If you think we are making some hard choices now, just wait till later. When you have the President, make what is in my opinion, a veiled threat to the Supreme Court, you know your not far from a dictatorship. At this point in time, even if the President was unseated because of his birth certificate, can you imagine what turmoil the country would face. There are those who believe what this Administration is saying and there are those who do not. Complicate this by a news media that has failed to properly investigate and you have successfully divided people into two camps. One who believes everything from the mouth of government and the other who will not believe anything due to the barrage of lies or half truths being constantly fed to them. I have been doing a lot of soul searching the past few weeks and I fear the only way this country is going to make it, is by passing through some type of crucible.
Greg, “the country needs statesmen, but what we have are bagmen who are pandering to the special interests that fund them” is so sad but true. This is happening all the while the nation worries about grade school bullies and other such nonsense. The sad fact is that most historical superpowers were arguing among themselves when they looked up and lost their empire by war or economics (or both), our arrogance will be rewarded with a third world status.
Good stuff Art and NM!!
Greg
I was just listening to Ron Paul and he had the following to say about government budgets: The only budget that counts is this years budget. Anything else is just pie in the sky rubbish (my word). All those 5, 10, 15 year projections are an illusion and election gimmick.
Agree with your summary of the situation, Greg, and give you credit for having the Cojones to speak the truth. The hard truth is that this nation faces 2 options: 1) establish a glide-path to fiscal sustainability that results in a deflationary depression or 2) kick the can toward a hyper-inflationary depression that lays waste to every part of our society. There really are no other choices. Option #1 will be very hard and painful, but it is nothing compared to the danger of option #2. The ironic thing is that in an effort to maintain the status quo, the powers that be will drive us toward option #2, which is exactly the scenario that will lead to their being swept away.
Thank you ABR, George and Jay! Folks like you and your comments manke the site!!
Greg
Correction, Greg, YOU make the site and we appreciate your efforts tremendously. Maybe its time to bring up the fact that Republicans in Congress are now trying to roll back even the limited regulations on derivatives that the Democrats were willing to pass in Dodd-Frank. God help us all.
http://www.reuters.com/article/2012/04/02/us-financial-regulation-derivatives-idUSBRE8310Z820120402?feedType=RSS&feedName=GCA-Economy2010
ABR,
God help us. Thank you for your kind words and support.
Greg
President Obama said, “It is antithetical to our entire history as a land of opportunity and upward mobility for everybody who is willing to work for it. A place where prosperity doesn’t trickle down from the top but grows outward from the heart of middle class.”
This is a non sequitur. How does freebies for half the population paid out of the efforts of the producer equate to prosperity growing outward? Or prosperity at all. When parasites kill the host, where do they go next?
WOW WOW WOW.
GREG.
So well stated im ashamed to be able to congratulate you on this artical. CNN dont know what they lost.
Greg: the key to solving our debt problem is an objective analysis of its scope, how we got there, and the willingness to change. That aint gonna happen in public discourse. Unfortunately, the great majority of our Congresscritters are wedded to the status quo of corrupt power and influence as the key determinent of public policy; the people be damned. The can will be kicked until all of the possible paths reach the inevitable brick wall. Although the people are awakening, it is too little, too late especially as the police state is already in place to counter any pushbacks by the general populace.
IMO that our only remaining hope will be to rebuild from the ashes through nullification and the re-establishment of states’ rights as envisioned by the Founders.
Andyb
The can will be kicked until all of the possible paths reach the inevitable brick wall.
I must add, Then blame the wall.
When I was a kid I learned that if I wanted extra money that I didn’t earn from a paper route or weekly allowance, I had to make a very strong case and I didn’t always get as much money as I needed. So I came up with a strategy.
If I wanted to attend a $30 concert and I only had $10, I would ask for $40 dollars. My parents would put up a fuss and tell me that I should already have some money of my own, and that $40 is more than I need even if I had no money at all. I would protest and say that’s true, but they’re not considering the concert t-shirt and grabbing some food or whatever after the show with my friends.
Most times they would say “You’ve got $10, we’ll give you another $20 for the ticket. But we’re not paying for the t-shirt or the snacks. Have fun.”
If I’d asked for $20 up front, I probably would have been given $10 and told to save it towards the next concert.
And that’s how the federal budget works. We (the voters) are the parents, and the Congress (Dem and GOP working together) are the kids asking for the funding. The Congress concocts the story, creates the conflict, inflates the numbers, and then scalse them back to settle on a figure that the voters would never have approved in the first place if they weren’t walked throught the planned back-and-forth drama to justify a budget number that was agreed upon long before the controlled media stepped up to the plate to generate an acceptable level of voter approval.
Regarding Obama’s comment on a “Trojan Horse”, I find it interesting that he used that analogy. I’ve been using Trojan Horse for years as an analogy to represent how the finance globalists have controlled the White House for the last 40 years. It’s a Trojan Horse occupation, under the guise of GOP/Dem party control as determined by voters, but in reality, the White House is populated by figures who are selected by private globalist finance who control the media, under the guise of representing the voters when their true role is faithful implementation of domestic and international globalist policy, regardless of it’s impact on the US Constitution.
You are right Greg, the bagmen are running the country!!!
God forbid if Roomney gets in, he would totally do the bidding of Wall St and the One Percenters without any reservations at all. Vulture Capitalism would rule absolutely!!!
Someone should tell Obozo that “a radical vision” is exactly what this country needs. Other than Ron Paul, they’re all morons.
The agenda for the left, expand and grow the government and make the government, all goods and energy so costly that the economy collapses and all are dependent on the government…is anyone missing the point of this administration?
Can we not just pass out bread and increase the allowances for the circus?
NC,
Too funny man!!!!! Love the sarcasm!!!!
Greg, it’s time for every one to think of their own survival,no? I have found physical silver premiums is very small while physical gold premiums for AGE’s & Maples is still getting wider! I found silver junk $1000.00 bags for 5 cents under spot, ASE’s $2.59 over spot with a purchase of 60 coins to 100 coins & 500 1oz coins or more $2.39 above spot. Gold coins minted by the U.S. mint & Canada’s mint need no assay & in a time of need you may swap them easy for cash if needed, but if one is smart, set on any gold if possible & don’t fall for the tricks by the CB’s to pry the gold from your hands as they issue more lies about any recovery.
These times remind me of a TV show called “It Take A Thief to Catch One”, so you must think like these crooks, they scare the public to sell their PM’s so they can cover their bets & gain more gold to stack for themselves, they know it’s money or they would not be buying it. Europe CB’s are way aheah of the U.S., each quater they ‘mark their gold reserves to market’, but not the U.S., not yet, but that day is coming, would you agree? Stack if you can!
M Smith,
Protecting you and your family is a very smart thing to do at this point.
Greg
I listen to Obama trash the GOP budget plan and talk about how much money would be taken out of the various programs, and how devastating this would be to America. It would certainly be felt, I’m sure, but all this money printing thats been going on is even more devastating to America and we are all ending up with even less. (Dollar devaluation). After his latest actions and comments, I hope people realize what type of individual he is and what he is trying to do to this country. He desperatly needs to be voted out.
Excellent article Greg, count me as scared speechless. Our candidates have been chosen for us. We must now choose the lessor of two evils. This one is the most evil and has got to go:
http://www.breitbart.com/Big-Government/2012/04/04/WHite-House-Rich-Pay-Nothing
Turning Americans against each other to win votes is beyond evil, it is dangerous. NDAA is in place and ready to go, all he has to do is goad the crowds into tearing the country apart so he can use his new powers to save us from the rabble?
Double check your emergency supplies, it is going to be a long hot summer.
Thank you Jan for the comment!
Even a hillbilly boy can own farmland if he don’t care about the house. The barn is worth the expense the house is for show.
You haven’t seen the farm land go down in price. The investor class holds worthless paper,big over size houses and cars that no one want.
If a investment goes bad maybe it was bad from the start and no law can change that.
The D.C. boys and girls are just up to the same old tricks, cutting up the pie. They don’t help pick the berries but they want some pie.
Wall street is just one big welfare case , waiting on the next QE. Soon they will be picking weeds for a meal. PEACE
Well said Greg.Gregory
One thing that always bothers me when mr. Obama speaks is the Orwellian Duckspeak he uses. He claims the oil companies are getting tax subsudie whenwhat ia really happening is the tax code which covers many industries. Why.would you single out one industry.and not the.others.
Mr Obama makes Gobbles look like a white house intern
Greg, How can you say that those who want to necessarily cut the federal budget are “bagmen”? If given the opportunity, I would eliminate ALL federal welfare, subsidies, aid, etc., overnight. You would see in instant resurgence in the strength of family, community, and eventually, the nation, as those who made poor choices would no longer be rewarded by those who did not. Take a few more steps such as elimanating the income tax, many federal agencies, and fiat currency, and we could return to real prosperity and opportunity. I see nothing wrong with the Republican plan, other than it does not cut enough!
RetiredPara,
Do you hear anyone on either side of the aisle talking about cutting all the backdoor bank bailouts? Fannie and Freddie burned through $20 billion in tha last quarter alone and now they’re talking about using $100 billion in “unused” TARP money to pump into The failed GSE’s. How about 0% interest rates for the bankers at the Fed? n Can you borrow money at a negative interest rate? The first thing I would cut is all the ongoing banker bailouts. The system will not truly recover with our real accounting and zero bailouts. This is the big problem, and the Republican plan does not address it. Thank you for your comment.
Greg
Why when you see talks about cuts corporate welfare is never mentioned? Time to cut off the tap to the big corporations and banks that have driven this country towards third world status by shipping jobs overseas while getting huge payoffs to “bail” them out.
Mary,
The first thing that needs to get the ax are the backdoor bailouts to the big banks through Fannie and Freddie. I agree, if we are going to cut spendig then let’s cut it all!!
Greg