Wednesday, July 20, 2011

Must Read: Ron Paul's Statement On Debt Limit Legislation

To start, I wanted to link a statement issued by Moody's yesterday that suggested that Congress should get rid of the debt ceiling limit entirely.  I had to rub my eyes and drink more coffee before I reread the headline to make sure I read it correctly.  Here's the LINK

To say that this idea is absurd truly underestimates the meaning of the word.  I understand the notion of getting rid of any future uncertainty over whether or not funding will be available to pay off bondholders by eliminating the all limitations on the amout debt the Government can issue.  However, this idea makes me wonder if the people running Moody's might perhaps be a consortium of "mentally challenged," aka retarded, individuals.  This nonsensical statement by Moody's is Orwellian in the extreme...

As Ron Paul argues eloquently and logically in the link below, the only way to solve what is right now a seemingly unsolvable problem is to start taking a giant butcher's knife to the entire Government, across the board.

As Congressman Paul states, we need to first start by drastically reducing the "sacred cows" of defense spending, entitlements and Social Security/Medicare:
These three budget items already cost nearly $1 trillion apiece annually. This means we can cut every other area of federal spending to zero and still have a $3 trillion budget. Since annual federal tax revenues almost certainly will not exceed $2.5 trillion for several years, this Act cannot balance the budget under any plausible scenario.
The heart of the underlying issue is the overall size of Government and Congress needs act against Obama and Bernanke and start aggressively reducing the size, power and scope of Government:  Here is the link to Mr. Paul's speech, and I would urge everyone to read it:  LINK
As Milton Friedman famously argued, what we really need is a constitutional amendment to limit taxes and spending, not simply to balance the budget. What we need is a dramatically smaller federal government; if we achieve this a balanced budget will take care of itself.


  1. SS takes in more then they pay. Additionally they have about $4 trillion that the feds borrowed from them. To lump SS with defense or welfare is dishonest. The government should seperate the SS from the budget and get congress out of the decision process. Force the SS adminstration to manage the money for the people and not the politicians.
    Medicare is in a similar position except that they do not take in as much in Medicare revenues as they pay out. The system should be designed to either pay for itself or if it must be subsidized then at least recognize it is one of only two federal programs with dedicated funding.

    The Medicaid program is 100% funded from the general fund. That means the people who benefit from Medicaid don't pay for medicaid. This is true for all the other various forms of welfare. If the budget needs to be cut then the programs of this nature should be cut and/or eliminated before even touching SS or Medicare.

    Eliminate the Department of Education, NASA, USDA, DOC, DOE, HHS, DHS, HUD, DOL, DOT, etc. None of these programs are self funded. None of these programs are required/allowed by the constitution.

  2. You want Summers op-ed ...this was our Treasury secretary...

    Only Poor People Should Be Allowed To Fail

    My regular readers surely remember George Carlin’s Great Big Club, the
    one you’re not in. The club’s members are the elites who have a large
    say in how the U.S. (and world) economy is run. They often come from
    the world of Big Finance. Usually they are former (and future)
    employees of the big Wall Street banks. There is no overt conspiracy
    to run the world. Instead, there is a loose but incredibly effective
    coalition of common interests. Washington politicians, at least the
    important ones, are often in their pocket.

    Larry Summers carries water for those interests. He is their
    mouthpiece and back in 1999 under Clinton, he was their enforcer.
    There he is (far right) on the cover of Time Magazine in February,
    1999 along with Bob Rubin and Alan Greenspan. And how was this 3-man
    committee to save the world going to accomplish this great feat? By
    deregulating derivative securities, repealing Glass-Steagall, etc.

  3. Ron Paul is right-on about what needs to happen to safe our country from the banksters. Ron Paul also introduce H.R. 459 to do a full audit of the Federal Reserve. It's about time we see what it is our central bank has been doing with swaps and loans to foreign countries (including Libya and China).

  4. Excellent post Dave!

  5. (Dave)

    I'd like to see your source for showing that SS takes in more than it pays. Actually I believe sometime in the last 12 months the payout started to exceed the revenue. SS was never meant to be expense subsidy for retirees. It was originally intended to assist widowed women. Now a majority of those receiving it require it. Plus there are many getting it that don't need it.

    But it doesn't matter how you slice up the Govt expense line, it still exceeds the revenue line by a couple trillion per year now (you measure the cash in/cash out defiicit by looking at net debt issuance every year) and that situation will eventually come to an end, either willingly with pain or unwillingly with twice as much pain.

  6. Immediately cease military adventurism. If corporate interests need protection while looting sovereign states, let them hire their own mercenaries. Why should US citizens pick up the tab? Paul Craig Roberts just published an excellent piece on this:
    An Economy Destroyed: The Enemy Is Washington