Archive for the ‘Deficit’ Category

Ener1 — a lithium-ion battery-maker whose EnerDel subsidiary received a $118.5 million grant from DOE as part of the 2009 stimulus — has filed for Chapter 11 protection, the company announced Thursday.

Ener1 owns 80.5 percent of EnerDel, while 19.5 percent is owned by the auto parts manufacturer Delphi, according a company press release last week.

The news comes just as President Barack Obama tours the country touting his energy plan. It’s also exactly a year since Vice President Joe Biden visited the company to highlight Obama’s 2011 State of the Union promise to put 1 million electric vehicles on the road by 2015, a plan that has largely fallen by the wayside.

Ener1’s filing, in U.S. Bankruptcy Court for the Southern District of New York, is part of a “pre-packaged” plan that will restructure the company and bring in as much as $81 million in new capital.
The plan is designed to keep the Ener1’s operations going and not lose any jobs, according to the company.

But House Republicans are already up in arms over the failures of Solyndra and Beacon Power, which received loan guarantees under a different DOE program, and say the latest news fits a pattern.

“Instead of producing thousands of ‘clean energy’ jobs, the administration’s loan guarantee and grant programs are yielding another bankruptcy and the squandering of taxpayer dollars,” said Rep. Cliff Stearns (R-Fla.), chairman of the House Energy and Commerce Committee’s oversight panel. “This is another reason why the White House should not be picking winners and losers among American manufacturers.”

Stearns also questioned the timing of the announcement, which came just days after Obama touted renewable energy during his State of the Union address.
“It is interesting that Ener1 made the filing after the president touted subsidies for batteries given that the administration asked Solyndra to hold off the announcement of job losses until after the 2010 elections,” Stearns said.

In November, House Republicans released emails in which an adviser to Argonaut Private Equity, a major backer of Solyndra, wrote that DOE officials “did push very hard for us to hold our announcement of the consolidation to employees and vendors to Nov. 3,” the day after the midterm elections. The adviser added that “oddly they didn’t give a reason for that date.”

DOE stressed that Ener1 is not going under and said its technology is sound.
“This grant is part of the department’s efforts to commercialize promising vehicle technologies that will help America to reduce our dependence on foreign oil and ensure U.S. companies can compete in the global auto industry,” DOE spokeswoman Jen Stutsman said in an email. “While it’s unfortunate that Ener1, the parent company, has entered a restructuring process, the new infusion of $80 million in private capital demonstrates that the technology has merit.”

DOE has paid out almost $55 million of the grant. It stopped payments last year after Ener1 began faltering and was pulled from trading on NASDAQ.
Stutsman said DOE will pay out the remainder of the grant dollar for dollar to match the company’s investments.

EnerDel also received some federal contracts during the George W. Bush administration, including a $6.5 million contract in 2007 with DOE and a consortium of auto manufacturers that shared half the cost, and a $4 million battery R&D deal in 2008 from the Defense Department.

“Our business plan was impacted when demand for lithium-ion batteries slowed due to lower-than-expected adoption for electric passenger vehicles,” Ener1 CEO Alex Sorokin said in a statement. “We believe that the restructuring plan will enable us to address our business and financial challenges comprehensively, quickly and efficiently, and position us to compete much more effectively in the energy storage market.”
The company said all of its creditors are on board with the plan, which a district bankruptcy court must approve.

Read more: http://www.politico.com/news/stories/0112/72032_Page2.html#ixzz1kfko4wyF

Americans instinctively understand that Washington needs to stop borrowing money.

Every public opinion poll done last year showed overwhelming support for freezing the debt limit. Republican voters were in favor by about 80 percent, but even a majority of Democratic voters wanted to see this drastic action taken.

Nevertheless, Congress, including the House Republicans, voted overwhelmingly to give Barack Obama all the money he needed to keep bankrupting America through the end of his term.Americans instinctively understand that Washington needs to stop borrowing money.

Every public opinion poll done last year showed overwhelming support for freezing the debt limit. Republican voters were in favor by about 80 percent, but even a majority of Democratic voters wanted to see this drastic action taken.

Nevertheless, Congress, including the House Republicans, voted overwhelmingly to give Barack Obama all the money he needed to keep bankrupting America through the end of his term.

Click here to learn more about the “Red Ink Campaign”
and how it can help stop congress from raising the debt limit.

In 2011, U.S. tax revenue equaled about $2.2 trillion. Washington politicians didn’t think that was enough to do all the good work they needed to do. So they agreed to spend $3.8 trillion, borrowing another $1.65 trillion in the process. To do that, they voted to increase the debt limit beyond $14.3 trillion.

That’s how America lost its top credit rating. But most of the politicians still don’t get it. In fact, they claimed that the top credit rating would be lost if they didn’t raise the debt limit. In fact, almost immediately after they took that action, the credit rating was lowered.

But America has a lot more to worry about with debt than a lower credit rating. Our entire way of life depends on getting borrowing under control.

There is only one solution: Cut spending – by about $1 trillion a year. Instead, Washington cut planned spending by only $38 billion. If you want to understand how insignificant that cut was, let me put it in perspective.

Speaker of the House John BoehnerLet’s say your family income is $21,700 a year, but you spend $38,200 using credit cards. Obviously, you can’t go on much longer living like that. But instead of cutting up the credit cards and living within your means, you decide to cut spending by only $385 a year.

That’s what Washington did in 2011.

Another way to understand it is like this: Let’s say there’s a sewer backup in your neighborhood that causes your house to be filled up with sludge.

What do you do?

1.Raise the ceilings of your house?

2.Pump out the sludge?

I think the choice is pretty obvious. Most of us would pump out the sludge. But that’s not what Congress and Barack Obama did. Instead, they decided to raise the ceilings.

We can’t go on like this much longer.

The day of reckoning is coming. Congress is about to raise the debt limit again this year, and Republicans have already compromised away their 100-percent authority to stop it with the silly compromise last year to cut only $38 billion. There’s not much we can do about that right now. But we can start a massive brushfire throughout this country to ensure that Republicans get their heads on straight in 2013 and say no more to borrowing.

You simply can’t address this explosive debt bomb by continuing to borrow, while claiming to be working on a balanced budget five years from now or 10 years from now. We don’t have five or 10 more years.

The debt has reached about $15 trillion already – exceeding the total gross domestic product of the U.S.

Worse yet, by allowing Washington to borrow, we allow them to destroy the Constitution and its strict limits on what the federal government can do. If Washington can spend whatever it wants without accountability to the people, we no longer have constitutionally limited government – and tyranny is right around the corner.

That’s why I need your urgent help in my “No More Red Ink” campaign – the only grass-roots lobbying effort around focused on freezing debt and forcing responsibility on Washington in the short term.

Click here to take part today and send every Republican member of the House majority a letter putting them on notice that you expect them to freeze the debt in 2013 and return our country to constitutionally limited government and a balanced budget next year. So far we have generated 1 million letters. We may need to generate 10 million. But it’s simple, fast and very inexpensive to participate.

By Charles Pope, The Oregonian

WASHINGTON — At least $7 million in federal stimulus money intended to provide jobs to unemployed Oregonians instead paid wages to 254 foreign workers, federal investigators have concluded.

The money was for forest clean-up jobs in central Oregon where thousands of experienced workers were idle. When the contracts were announced in 2009, Oregon had the third-highest unemployment rate in the nation at 11.1 percent, with rates in the state’s rural forest counties nearly 15 percent and higher.

Even so, the contractors told federal regulators they could not find enough local workers for the jobs.

That came as a surprise to local officials, who said they often got hundreds of responses to every job opening.

“This is a timber area and we hadn’t been cutting trees for years,” said state Sen. Chris Telfer, R-Bend. “It really ticked off a lot of people here.”

In a report on the investigation this week, the Department of Labor’s Inspector General found that contractors who brought in foreign workers violated no laws or regulations, but used legal loopholes to hire foreign workers.

While legal, the hiring practices appear to violate the spirit and purpose of the $840 billion American Recovery and Reinvestment Act of 2009, better known as the stimulus, which was designed to create jobs that would jumpstart the country out of recession.

“The goal of the stimulus bill was to put Americans back to work, not foreign nationals,” said Rep. Peter DeFazio, D-Ore., who asked for the investigation in September 2010.

“It is obscene that U.S. companies were rewarded for abusing our American workers and immigration laws to undercut competition and squeeze more profits out of contracts,” DeFazio said. “Oregonians have been logging for over a century, our workforce is one of the best in the world, and these contracts should have been awarded to companies that hire Oregon loggers.”

The federal investigation looked at 14 contracts to clear federal forests in central Oregon. The contracts were controlled by four Oregon companies: Medford Cutting Edge Forestry, Summitt Forestry, Ponderosa Reforestations, and G.E. Forestry. All hired foreign workers, according to the report, though they didn’t all handle hiring in the same way.

The contractors applied for H-2B visas allowing them to hire workers for seasonal jobs, according to the report. In order to get clearance, contractors must prove the jobs can’t be filled with local residents and that pay won’t dilute local prevailing wages.

But there is a loophole. Under federal rules, notice of the job openings must be made where the job “originates.” And while the bulk of the work took place in Oregon, smaller jobs originated in other states.

According to reports by The Bend Bulletin, which revealed the foreign hires in a series of stories last year that triggered DeFazio’s call for an investigation, contractors advertised the jobs in tiny newspapers in California and Washington state for several days.

“Employers were not required to recruit U.S. workers in Oregon, and we were provided no evidence that they did,” federal investigators said. “Workers in Oregon were likely unaware that these job opportunities were available.”

In fact, although 146 U.S. workers were contacted for possible employment, investigators found that none was hired.

Contractors used another regulation to dampen response from Oregon residents, the report said. The visa regulations allowed the contractors to do all their hiring four months before work started. That made unemployed workers who needed jobs immediately reluctant to commit to temporary jobs four months later.

Despite the barriers, 29 U.S. workers learned of the jobs and asked about employment. The report did not say if they were from Oregon.

“We verified with the employers that none of these workers actually began employment with them,” the report says.

The reason?

“We spoke with two workers who reported that the employer used discouraging language, such as references to age and inquiries about speaking another language, which are not valid conditions of employment,” the report says.

The report does not address the nationality of the workers who were hired.

As required, the employers also notified state workforce agencies of the openings. But just as with obscure newspaper ads, the state postings were far-afield, with the notices sent to Arizona, California, Idaho, Washington and Wyoming.

The Labor Department did not respond to a request for comment, but agency officials have announced plans to revise regulations dealing with H-2B visas.

Congress is likely to act, too. Aides to DeFazio said he is closely monitoring the Labor Department’s proposals for fixing the problems and is not ruling out other action. And in the Senate, Oregon Democrat Ron Wyden said he is watching as well.

“Right now there are 14 million job seekers in the U.S. and three million job openings.” Wyden said. “Given those numbers, there is absolutely no reason why hard-working Oregonians should be passed over en masse for Oregon jobs in favor of foreign workers.”

– Charles Pope

An energy company that received a $43 million loan guarantee through the same federal program that backed Solyndra has followed the path of the failed solar firm and filed for bankruptcy.
Beacon Power Corporation filed for Chapter 11 bankruptcy on Sunday in U.S. Bankruptcy Court in Delaware. The company, which develops energy storage systems based on what are known as “flywheels,” had received the federal guarantee for a 20-megawatt energy storage plant in Stephentown, N.Y., back in August 2010.

The loan was expected to cover the lion’s share of the $69 million project, one of several that Beacon was developing across the country.
But the company’s CEO said in a statement to the court that all those projects are “capital intensive,” and the firm is struggling to attract the additional investment needed to keep everything running. The fact that the company faced being de-listed from the NASDAQ didn’t help, he said.

“At present, the revenues generated from the operation … are not sufficient to fully support those business operations, and the debtors currently operate at a loss,” CEO F. William Capp said in the court statement. “In addition, the current economic and political climate, the financing terms mandated by DOE and Beacon’s recent de-listing notice from NASDAQ have together severely restricted Beacon’s access to additional investments through the equity markets.”
The Massachusetts-based company also received $29 million in grants from the Energy Department and the state of Pennsylvania through separate programs for a plant in Hazle Township, Pa.
Beacon Power Corporation has not responded to a request for comment from FoxNews.com.

The bankruptcy filing comes as members of Congress dig deeper in their investigation into the billions of dollars in federal loan guarantees that were committed to alternative energy companies, including Solyndra. The Obama administration has also opened an inquiry.
Rep. Morgan Griffith, R-Va., who sits on the House Energy and Commerce oversight subcommittee probing the program, said the news about Beacon Power is troubling.

“We’re very, very concerned about this and many other loans that have been made by the Department of Energy over the last several years,” he told Fox News on Monday. Griffith said plenty of companies in the U.S. would make “good prospects” for federal help, but the committee investigation is trying to find out whether the government was “just trying to get the money out the door.”

Sen. Jeff Sessions, R-Ala., ranking member of the Senate Banking Committee, called the revelation of the bankruptcy another example of “the reckless abuse of taxpayers’ dollars in the pursuit of green jobs.” He also suggested that crony capitalism had a hand in the decision to give Beacon a loan.

One of the most controversial aspects of the Solyndra case — aside from the sheer size of the $535 million guarantee — was a decision earlier this year to prioritize private investors over taxpayers in case of bankruptcy. Republicans have accused the administration of giving precedence to investors in the companies who are also Obama backers.

“As with Solyndra, the head of Beacon Power appears to have been a supporter of President Obama’s,” Sessions said in a statement.
“Increasingly, we are moving away from our capitalist heritage and towards a system where most Americans play by the rules while some are able to rig the game in their favor. The real divide is not split along income lines, but between the politically-connected and those—whether businesses or individuals—who just want the freedom to earn a living.”

But an Energy Department spokesman said the agreement with Beacon included “many protections for the taxpayer” and that the government is the only “senior, secured lender” in the project.
“Protecting taxpayer dollars remains the top priority for Secretary (Steven) Chu and the department,” spokesman Damien LaVera said in a statement. “The department’s loan guarantee is for the project Stephentown Regulation Services, LLC, not the parent company, and the loan was set up in a way that ensures the department is not directly exposed to the liabilities of the parent company.”

LaVera noted that the New York plant, “which is operational and generating revenue,” is a “valuable collateral asset” for the company as it enters bankruptcy proceedings.
“Under the terms of our loan guarantee agreement, Stephentown Regulation Services, LLC currently has cash reserves and proceeds from the plant that it was required to hold as collateral on the loan,” LaVera said.

According to court filings, the company owes the government $39.1 million under the loan – though it had authority to borrow up to $43 million. LaVera said the company did not borrow the full amount because the plant was under budget.
When the project was approved, the Energy Department reported that the loan guarantee would help save or create 14 permanent jobs and 20 construction jobs.
Capp emphasized in the court filing that the company has a number of positive factors going for it.
After investing $200 million on “research and development” and racking up nearly three dozen patents, Capp said the company’s “long-term prospects are strong.”
He said the company’s “engineering and other technical personnel are excellent” and can produce “niche” products demanded by the marketplace.

He also noted a recent Federal Energy Regulatory Commission decision would make grid operators pay more for faster services — and said Beacon’s systems, which “react in seconds,” should allow the company to “earn significantly increased revenues” this way.
Energy Department spokesman Dan Leistikow also cited the FERC decision in touting the Beacon loan guarantee on an Energy Department blog Monday. He said the decision could help the company generate more revenue.

Defending the decision to back Beacon, Leistikow said the company is trying to address a lack of energy storage in the U.S., which accounts for a weakness in the country’s power grid.
“Even a small increase in America’s energy storage capacity would make our system more flexible, stable, and reliable, and play an important role in our overall effort to reduce the number of costly power disruptions each year,” he said. “One promising new technology for dealing with the moment-to-moment fluctuations in our power grid is flywheel energy storage.”

Flywheels like those developed by Beacon, he said, “are ‘charged’ by using electricity to spin them faster and ‘discharged’ by using flywheels to spin a turbine and generate electricity.”
He described the Beacon plant as a “shock absorber” for the grid, and said it was the first of its kind in the world.
He also noted that, unlike with Solyndra, the plant funded with help from DOE is still operational.

Campaign finance records show top Beacon officials contributing to Democratic candidates. Capp apparently was an Obama supporter, giving at least $500 to the Obama campaign in 2008. He also donated to Rep. Niki Tsongas, D-Mass.
Beacon employee Matthew Polimeno has donated $750 since 2008 to Tsongas’ campaign and another $250 to the failed campaign of Massachusetts Democratic Senate candidate Martha Coakley. CFO James Spiezio also donated $250 to the Coakley campaign in 2009.

By DICK MORRIS
Published on TheHill.com on October 18, 2011

In 1980, facing a terrible economy, Ronald Reagan called for a new tax program: 10-10-10. Based on the Kemp-Roth bill, he called for 10 percent cuts in income taxes for three years. He got it, and it kindled 20 years of prosperity.

Now, Herman Cain understands that we need fundamental reform to get our economy moving. He calls for replacing the current system with just three levies of 9 percent each on personal income, corporate income and consumption. There would be no capital gains tax, inheritance tax, Social Security tax or Medicare tax. Just 9-9-9.

His proposal is breathtaking. Currently, the lowest top tax rate is Poland’s 18 percent. And Poland is the only European nation that had no recession. If Cain passes 9-9-9, we will thrive and become the destination of choice for every business and businessman. Look at what Reagan’s tax cuts achieved, and at the best-performing state economies, where there is no income tax.

The proposal, naturally, attracts critics and skeptics.

Some worry that it will add to the deficit. But that’s not likely.

· Americans now earn $12.5 trillion of personal income. Tax it at 9 percent with no deductions and you generate about $1.125 billion.

· We spend $10.3 trillion. A 9 percent tax would yield about $927 billion.

· Net corporate income (after dividends) is $1.1 trillion. A 9 percent levy would generate $100 billion.

· That comes to $2.152 billion, about the same as our actual revenues of $2.162 billion for fiscal 2010.

And then, when you factor in the economic growth this plan will engender, the scenario becomes even better.

Liberals worry that the tax would shift the burden from the rich to the middle class. No, sir. Americans making $50,000 to $60,000 a year now pay an average of 6 percent of their income in income taxes. But they also pay 6.5 percent in FICA levies and 2.9 percent in Medicare payroll taxes (a total of 15.4 percent). The Cain proposal would replace these with a flat 9 percent, saving them 6.4 percent.

Of course, the middle class would also have to pay a 9 percent sales tax, but it would be largely offset by the savings in their payroll taxes.

Cain says that competitive pressures would hold down prices and force businesses to eat much of the 9 percent sales tax. Employers would not have to pay their 6.5 percent share of payroll in Social Security taxes, and their corporate taxes would be cut. For commodities with high price elasticity — like cars — competition will hold down prices. But for inelastic purchases — like food and drugs — some of the tax would probably be passed on. For the middle class? It’s a wash.

More compelling is the possible impact on the poor. A family making $20,000 to $30,000 a year pays only 3 percent of its income in taxes (much of it more than offset by tax credits). But it still pays 6.5 percent in FICA and 2.9 percent in Medicare taxes. So the requirement that such a family pay 9 percent in personal income taxes would probably be fully offset by the cut in payroll taxes. But the poor might face higher prices. Cain plans to spell out how he can mitigate the impact on the poor through special empowerment zones. We need to see the details. Certainly, the poor would benefit from the increased employment, wages and growth the Cain tax cuts would generate.

Conservatives worry that 9-9-9 will open the door to a European Value-Added Tax that starts at 9 percent but goes up each year. Cain proposes that a two-thirds vote be required to raise rates. But a simple act of Congress could change that.

The real answer is political. If the Republican Party surges back to power in 2012, captures the Senate, keeps the House and takes the presidency, it can make sure the rates don’t go up. Republicans usually can count on 40 votes in the Senate; we just have to use them.

The 9-9-9 is a good, good plan that can save our economy.

The Washington County Tea Party has released an excellent letter about the debt election on November the 8th.  They and Secure Arkansas are leading a growing campaign against more state debt that now includes the following groups:

Secure Arkansas (securearkansas.com)

Washington County Tea Party (washingtoncountyteaparty.com)

Pulaski County Tea Party (pulaskicountyteaparty.com)

River Valley Tea Party (on FB)

Boone County Tea Party (boonecountyteaparty.com)

Little River Patriots (on Facebook)

Americans for Constitutional Government (Fort Smith)

Northeast Arkansas Tea Party (northeastarkansasteaparty.jigsy.com) Miller County Patriots (millercountypatriots.com)

Of particular note: a similar bond plan started in 1999 appears to have cost us $264 million highway dollars in interest to get $575 million a few years early.   That does not include bond fees, brokers commissions, or legal fees.  We could have had over half that $575 million in only four years simply by spending the money as it came in.

The letter follows…..

*************************************************************

“I go on the principle that a public debt is a public curse.” -James Madison, the Father of the Constitution

Everyone is on “issue overload,” but public debt is an important issue, and once again a “special election” is being called (November 8), hoping you won’t pay attention or care so they can keep us loaded down in more debt.  This is becoming a disturbing trend in Arkansas–”special elections” where 2% to 5% of voters turn out and vote more taxes on the thousands of other citizens who were not even aware of the election but will now have to pay the tax.  This needs toSTOP.

Washington County Tea Party has created a flyer which is being distributed around the state for educating the public (attached).  Notice the list of tea party groups who stand in agreement in opposing debt. Every corner of the state has been reached with activists who agree with the anti-debt message and are distributing this flyer.  Can you help print and distribute a few to people you know?  Can you forward this to your Arkansas contacts and ask them to forward it to their Arkansas contacts?  We have potential to reach a lot more people that way.

We are finding that even some activists had misunderstandings about the “debt election” on November 8, but most are 100% on board with opposing more debt, a major tenet of tea parties across the country.  We have compiled some “frequently asked questions” (below) which may answer some questions you might have about this so you can be informed and able to educate people you know about why we must stand opposed to debt. This information is also on our web site, so you may refer your friends to www.washingtoncountyteaparty.com.

“We the People” still have power to stop this if enough people do just a little bit and help spread the word.

Frequently Asked Questions

1)   The roads in my area of the state need to be repaired. I want my roads fixed, so isn’t this a legitimate means to do that?

This debt measure does not affect any state or local roads, so your local roads will not get fixed just because this bond passes.  The bond money is supposed to be used only for maintaining existing interstates.  .

2) I am a conservative, but I think maintaining roads is something the public should spend money for.

Please understand, we all want properly maintained roads. We agree that maintaining roads should be a priority as a legitimate use of taxpayer money. Since Arkansas is known as the highest taxed Southern state, why can they not find a way to maintain roads without going into debt? We need to address that issue before we agree to continue the vicious cycle of debt for routine road maintenance.

Put another way, if it is really true, as “Move Arkansas Forward” is claiming, that we must maintain or “modernize” our roads by going into debt to do so, then that proves our point that highway funds have been mismanaged, and the answer is not to keep repeating the same mistake.

By the way, Move Arkansas Forward is co-chaired by the same man who chairs the Arkansas Highway Commission (Madison Murphy of Murphy Oil–Wal-Mart gas pumps), and they are putting out conflicting information about what this bond money would do.  They insist on one hand that this is only about maintaining what we already have, while also promising to “modernize” and add exits, ramps, and bridges. So which is true?  How can we know?  The Arkansas Highway Commission is not elected or accountable to us for how the funds will be spent.

Which brings us to the next point–how can anyone know what roads will need maintenance 15 years from now?  No one can, so why not just use existing federal funds to pay as we go where it is needed most?

3)  Since this does not raise taxes, why should we not agree to a bond measure if it will fix our roads?

First of all, a bond is still debt, and debt is a still a form of enslavement, as it has been throughout time.

“We must not let our rulers load us with perpetual debt” – Thomas Jefferson

Secondly, the ballot language clearly states that if revenues from federal highway funds or fuel taxes do not come in, repayment will have to be made from the general fund.  That means we taxpayers will be on the hook should those funds not come through.  There is a potential then for a tax increase to cover it, or else spending will have to be cut somewhere else, and how likely is that?

4) Wouldn’t we save money in the long run if we go ahead and invest now while they are able to get this reduced interest rate?

Interest rates were not very high in 2000 either, yet we will have paid an estimated $264 MILLION* in interest to get that $575 million a few years early.  You read that right. That figure does not include bond commission fees or legal fees.  It does not make economic sense to keep letting our highway funds be eaten up in interest and fees.  If we just spend the money as it comes in, we would have over half of it in just four years with no interest or fees!  Bear in mind they took three years to get the full $575 million the first time, and no one can guarantee what interest rates will be 3 years from now.

5)  Businesses, particularly tourism businesses, need good roads.  If businesses lose revenue because of poor roads, it takes years to attract business back to the state.

Agreed, and again, this is only about interstates, and debt is not the solution.  The fact is, the high taxes in this state are an even bigger deterrent to business, and there is potential for even higher taxes if we end up without enough revenue to pay back these bonds.

Republican presidential candidate Ron Paul on Monday unveiled a radical new economic plan that would cut $1 trillion from the federal budget within a year, eliminate five cabinet-level departments — and even slash the president’s salary.
Paul maintains that his plan will create a balanced federal budget by the third year of his presidency.

The Texas congressman “is the only candidate with a plan to cut spending and truly balance the budget,” according to an executive summary of the plan. “This is the only plan that will deliver what America needs in these difficult times: Major regulatory relief, large spending cuts, sound monetary policy, and a balanced budget.”

Paul would eliminate the Departments of Education, Commerce, Energy, Interior, and Housing and Urban Development. But some functions of the eliminated departments would be continued elsewhere in the federal bureaucracy.

His plan would cut spending by the Environmental Protection Agency by 30 percent, slash 40 percent from the Food and Drug Administration’s budget, and immediately freeze spending by numerous agencies at 2006 levels, the last time Republicans had complete control of the budget.

Paul would also “take an ax to Pentagon funding for wars,” and foreign aid would be “zeroed out immediately,” Politico reports.

Among other provisions of Paul’s plan:
Medicaid, food stamps, family support programs, and the children’s nutrition program are block-granted to the states.
Congressional pay and perks are slashed, and the president’s salary is reduced to $39,336 a year, which Paul maintains is about equal to the median personal income of the American worker. The president currently earns $400,000.
The federal workforce is reduced by 10 percent.
Young workers are allowed to opt out of Social Security.
The top corporate income tax rate is cut from 35 percent to 15 percent.
All taxes on capital gains and dividends are eliminated, as well as the estate tax, and the Bush-era tax cuts are extended.
Obamacare is repealed, along with the Dodd-Frank financial regulatory reform law.
Paul also calls for an audit of the Federal Reserve, and legislation to strengthen the dollar.

Jesse Benton, Paul’s campaign chairman and a co-author of the plan, said in a statement: “It’s the only plan offered by a presidential candidate that actually balances the budget and begins to pay down the debt.”

Read more on Newsmax.com: Ron Paul: Cut Cabinet and President’s Salary
Important: Do You Support Pres. Obama’s Re-Election? Vote Here Now!

The party’s over and it’s time to pay the bill.  Our government has been on a spending binge for as long as I can remember.  With Clinton and Newt’s slight-of-hand accounting back in the late 90s notwithstanding, which wouldn’t withstand the level of scrutiny we give a tab at our local burger joint, there have been yearly deficits every year since I was born back in the 40s. The debt piled up to a record amount under Bush the Younger, and under Obama it has sky rocketed to the point where people have actually begun to notice that the emperor has no clothes.   

It isn’t that our nation is broke since our assets still outweigh our debt, but who wants to sell Yellowstone to satisfy the Chinese?  It isn’t just our government who has buried us buying $640 toilet seats, $436 hammers, or a $797,400 outhouse.  All of us have had an apple out of that sack.  We have pushed our personal credit to the max, our plastic to the limit, and our “Gotta have it now” culture to the breaking point.  It isn’t just the 51% who pay no federal taxes but seem to have an insatiable appetite for federal services that are to blame.  Those of us who make enough to merit a tax target on our backs have also drunk deep from the government trough.  Social Security, Medicare, disaster relief, and student loans have added billions if not trillions to the national debt transferring money to the middle class. 

All of us have contributed to this problem.  If not by accepting the money or services ourselves than by voting for people who’ve made careers doling out the plunder, robbing Peter to pay Paul, buying votes, and corrupting the system.  The entire edifice of Western Civilization teeters on the brink of financial collapse due to the last three generations squandering the as yet unearned income of the next three.  We invested the great grand kid’s future in Ponzi schemes so that we could play today and they could pay tomorrow.  This is the national version of “I will gladly pay you Tuesday for a hamburger today.” 

Our lack of interest allowed politicians to run amuck.  Our personal greed and lack of restraint have all of us living in houses made of plastic cards.  We look at Greece and ask for whom the bell tolls ignoring the answer that it tolls for thee. 

The enemies of capitalism learned the wisdom of Alinsky that “Change comes from power and power comes from organization.”  They followed gurus such as Richard Andrew Cloward and Frances Fox Piven two Columbia professors who advocated overwhelming the government bureaucracy with entitlement demands.  They followed leaders such as Barney Frank and Christopher Dodd who have pushed legislation that created the bubbles and then strangled the recovery.  Now these well organized and well financed Progressives have come to the end game.  In the great tradition of all socialist power grabs now that the crisis has arrived they have taken to the streets. 

The Corporations Once Known as the Mainstream Media are falling all over themselves trying to equate the current Occupy Everywhere movement with the Tea party.  I’ve known the Tea Party. The Tea Party is a friend of mine, and this is no Tea Party.  I have attended many Tea Party Events and they were all peaceful.  They all respected the police, and stayed within the limits of lawful protest.  When the events were over they left the areas cleaner than when they arrived.  The only people arrested at Tea Party events have been Progressive street thugs who have attempted to disrupt a peaceful protest. The liberal version is trashing every place they lay their head and threatening violence.  In all the Tea Party events over the last few years not one persona has been arrested.  In the Occupy Movement in just a few weeks hundreds have had to be hauled away. 

I personally know a professional agitator who glories in the title of the Rude Guy.  He has made a lifestyle out of pushing for the socialist agenda he imbibed as a youth in public school.  He has spent decades moving from protest to protest advocating an end to capitalism while supporting himself through the sale of his books and paintings.  This Rude Guy has moved from the implosion of Europe to what some enemies of our nation are calling the American Spring seeking free room and board in New York to continue his work.  Given the fact that Van Jones has spent years, George Soros has spent millions through his front groups, and that professional organizers are flocking in from around the world it is hard to buy the Corporate Media line that this Occupy Everywhere movement is spontaneous.   

However, there are the Howard Beale types who want to scream “I’m mad as hell and I’m not going to take it anymore!”  And there are also the young party people who are looking for an opportunity to have an experience, to recreate the golden years of the 60s when they fantasize the Summer of Love produced something of value besides a generational overdose and a rise in STDs.  These naive sheep will be driven before the organizers into the police truncheons.  It is these unengaged warm bodies being interviewed nightly.  These are the ones who come across as unfocused, confused, and almost comical.  They do not represent the well-oiled machinery behind the curtain. 

The list of millionaire entertainers who stop by to step out of their air-conditioned limousine to shout, “Power to the people” as they shake their bejeweled fist grows every day.  The union bosses express solidarity and send in their shock troops.  Leading Democrats praise the movement.  The Chairman of the Democratic National Committee, Debbie Wasserman Schultz, has said the Occupy Everywhere Movement is more in the mainstream than the current crop of Republican candidates for president.  This movement is not spontaneous, and it is not going to end well.  In some places the leaders of this leaderless movement are calling for violence and socialism.  In other places they are leaving the public square to march on private residences to intimidate and threaten.  Is this organized anarchism or militant apathy?   

Some of the issues their signs rail against: bank bailouts, corporate welfare, and other aspects of crony capitalism are issues they do share with the Tea Party.  However, the Tea Party Movement has directed their anger at government which is the culprit as far as wasting our national treasure to support their donors.  The Occupy Movement is focused on attacking the donors who have received the payouts.  The people who invested with Bernie Madoff thought they had found the goose that laid golden eggs, and yes they did receive unrealistic and what are now called unearned payouts, but at the end of the day it wasn’t the investors who were arrested it was Madoff.  The Tea Party offers concrete proposals: end the over spending, cut taxes and regulations, and free the economy to free the people.  The Occupy Movement offers no solution besides more of the same government intervention that caused the problems to begin with. 

As stated at the beginning, we have all had a hand in leading our great nation to the edge of the abyss.  And it seems as if our inability to agree upon who the culprits are or what the answers are may push us over the edge.  A great contraction in our economy and in our life styles is coming.  We must choose.  Are we willing to make the changes that will right the ship of state and begin to bail out the rushing tide of debt that threatens to capsize us?  Or, will we continue to argue ourselves into paralysis until our creditors demand the austerity we dread?   

The one thing worse than being poor is being poor again.  Most of us individually and all of us as a nation have been living far beyond our means charging extravagance to a credit card that has reached its limit.  We can either send back the steak and have a hamburger on our own now or eventually sit powerless as our card is cut up by the foreign maître.  We can either change our menu from caviar to corn flakes now or end up eating rubber biscuits as we wash dishes in the back room. 

One thing is for sure the contraction is coming, how do you want to deal with it?  

Dr. Owens teaches History, Political Science, and Religion for Southside Virginia Community College.  He is the author of the History of the Future @ http://drrobertowens.com © 2011 Robert R. Owens drrobertowens@hotmail.com  Follow Dr. Robert Owens on Facebook or Twitter @ Drrobertowens

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Well, well, well. It seems Solyndra isn’t the only company to have crashed and burned, despite a massive injection of stimulus money. FoxNews reports that at least four other companies received government funding, and subsequently filed for bankruptcy. Adding insult to injury, two of these companies were supposed to create (or was it save?) “green jobs.”

Evergreen Solar Inc., indirectly received $5.3 million through a state grant to open a $450 million facility in 2007 that employed roughly 800 people. The company, once a rock star in the solar industry, filed for bankruptcy protection last month, saying it couldn’t compete with Chinese rivals without reorganizing. The company intends to focus on building up its manufacturing facility in China.

SpectraWatt, based in Hopewell Junction, N.Y., is also a solar cell company that was spun out of Intel in 2008. In June 2009, SpectraWatt received a $500,000 grant from the National Renewable Energy Laboratory as part of the stimulus package. SpectraWatt was one of 13 compaines to receive the money to help develop ways to improve solar cells without changing current manufacturing processes. 

The company filed for bankruptcy last month, saying it could not compete with its Chinese competitors, which receive “considerable government and financial support.”

Deputy Secretary of Energy Daniel Poneman also took to the papers to bemoan our failure to keep up with China’s cheap, high-quality solar panels. His argument? We didn’t sink enough money into these failed ventures. After all, the Chinese government subsidizes the heck out of their solar panel industry!

Oh yeah, and there hasn’t been substantial demand for solar panels, so no one is buying the commodity we’re producing expensively anyway. Minor detail.

More damning evidence that the “stimulus” didn’t stimulate anything, except perhaps Debbie Wasserman Schultz‘s imagination.

Reagan inherited economic problems and fixed them. Obama’s strategy is to blame Bush and Standard & Poor’s.

The Wall Street Journal     August 8, 2011 

‘He becomes visibly agitated. . . . He does not like to be challenged on policy grounds,’ says the House majority leader of the president.

The Wall Street Journal August 6, 2011

What we’ve got here is far worse than a failure to communicate.

Central Falls’s receiver raised taxes, which drove people out of town.

The Wall Street Journal         August 5, 2011

Monday the small Rhode Island town of Central Falls declared bankruptcy because its sky-high labor costs had impaired its ability to pay its bills. The ratings agencies say the development is no surprise, but we wonder whether they’ll be saying the same thing when a bigger city falls off a cliff.

Cruel history turned against the president and the left’s long-term spending dreams.

The Wall Street Journal Aug 4, 2011

Godfather Politics

While watching the whole debt ceiling debacle unfold I can’t help but watch how the President of the United States steers his ship. He is called the Commander in Chief, the Leader of this Nation, the “One.” All of which insists that he is, well, the President. But let’s look at it like this. The nation itself is a ship, (that’s why it’s often called the “Ship of State”), the American people are its passengers, the men and women of Congress are the ship’s crewmen and the president is its captain. It must run as a well oiled machine. Everyone needs to be doing his or her part, and it needs an authoritative figure for guidance and direction when the situation is dire.
If the crews cleaning the decks aren’t doing their part, than the crews hoisting the sails aren’t able to move around appropriately to propel the ship. If the crews hoisting the sails aren’t propelling the ship, the captain is unable to steer the ship. If the captain is unable to steer the ship, the ship could hit a reef, sink. Think Titanic. When the ship is in treacherous waters, there needs to be a leader stating “come together, clean the deck, raise or strike the sails, and do it now.” The Caine Mutiny(1954) comes to mind.How a captain runs his ship is how the ship makes it from point A to point B in one piece and able to sail again. Let’s look at why Captain Obama is heading for the rocks.Now, in a management situation where there is a mistake that has been made, the number one rule is “I don’t care who did it, fix it.” President Obama is doing the opposite. He is glaring at the right side and saying “You ran the car into the ditch and now you are sipping on a Slurpee asking if you can drive after we get it out.” He has even gone so far as to compare Republicans to his elementary-aged daughters. He is blaming everyone but himself. It’s like he’s lying down in the middle of the floor holding his breath until he gets his way.

If you are going to captain a ship, run a bakery, drive a nation . . .the main requirement is teamwork. One team working on averting a disaster is much better than two teams going in opposite directions. You, Mr. President, need to put your big boy Dungarees on and state, “We are in a horrible situation, I don’t care who did. Let’s fix it.” Our President needs to stop pointing his finger and start bringing people together. Instead of pitting two sides of Congress against one another, get them to realize that they are in their position for one thing and one thing only: The well being of the passengers of the ship. Get up there and tell the crewmen to pick up the slack, come to an agreement and get us out of this situation without sinking the ship or posturing for political accolades.

A President is someone who is supposed to keep a country together, not rip it down the center.

Godfather Politics

July 26, 2011 by Pentangeli

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