Free Republic

In general terms, politicians and the press may be referring to what has been happening in Washington, D.C., over the past few days as a government “shutdown” or a “partial government shutdown,” but the actual accounting sheets of the U.S. Treasury show that massive amounts of taxed and borrowed money were flowing in and out of the government during the first two days of fiscal 2014. … To put things in perspective, in the first two days of fiscal 2013 (Oct. 1-Oct. 2, 2012), when there was not a “shutdown,” the federal government spent $124.409 billion, collected $29.057 billion in...

Treasury Secretary Jacob Lew said Wednesday the government will have exhausted its borrowing authority by Oct. 17, leaving the United States just $30 billion cash on hand to pay its bills. That’s a slightly worse financial position than Treasury predicted last month and adds to the pressure on Congress to increase the government’s borrowing cap soon to avert a first-ever U.S. default on its obligations. In a letter to top congressional leaders, Lew warned that a repeat of the debt brinksmanship of 2011 could inflict great harm on the economy and that “if the government should ultimately become unable to...

It's a rough job market for anyone looking for work as we continue to just barely break stagnation levels in the Slowest Recovery Ever, but the picture is particularly bleak for the fresh-faced youths looking start careers. According to a new economic report, the situation is going to be “extremely difficult” for the crop of 2013 college graduates: Unemployment remains high for young college grads. For those who will find jobs, many will probably have to settle for low-level positions, the Economic Policy Institute said Wednesday.The unemployment rate for recent college grads between the ages of 21 to 24 has...

You know the unpleasant facts. The federal government has been and will likely continue to run an annual deficit of $1 trillion indefinitely. It borrows or prints approximately 40% of every dollar spent. federal debt amounts to over $16 trillion. The debt/GDP ratio ranges between 70% and 100% (depending on the methodology you use) – historically dangerous territory for a government. Future entitlement obligations amount to tens of trillions and will overtake the budget in future years unless something significant changes. During the election campaign, the debate centered on whether our fiscal course should be stabilized with an emphasis on...

Americans live in a consumer culture. We like to buy things. When we can’t afford to purchase something we really want, we turn to credit cards and loans, even though we end up paying more due to interest payments. Over half the population paid interest on credit cards in the past year. “Buy now – pay later”. This mindset has resulted in the plague of personal debt many families struggling with. Unfortunately the “buy now – pay later” mentality is not limited to the individual consumer, Americans are also inclined to incur debt to fund government projects we can’t afford....

House Speaker John Boehner (R-Ohio) said there was “zero” chance that Senate Majority Leader Harry Reid (D-Nev.) and then-Sen. Barack Obama would have supported giving President George W. Bush the power to unilaterally raise the debt ceiling, as they propose giving the chief executive today. … “Do you think that Senator Reid or then-Senator Obama would have ever given to President George W. Bush the unlimited ability to raise the debt limit?” Boehner said. “They’re talking about doing it now,” a reporter replied. “I know they’re talking about doing it now,” Boehner said, jokingly. “Do you think there’s any chance...

The GOP needs to use their one big chit in the tax negotiation. They need to demand that included in this deal is increasing the national debt limit. In return for increasing the national debt limit they need to get something tangible. Something like no tax increase. They can not accept illusions of spending cuts that will never happen. They could link the debt ceiling to the current tax code and everytime the debt limit comes up, the tax code would too.

Today’s weak economic growth numbers were as predictable as they are disheartening — and the blame lies squarely with those who opposed the president’s American Jobs Act nearly a year ago, and have in fact opposed an array of sensible economic policies to expand public investments that create jobs and economic growth ever since President Barack Obama took office [Snip] Economists have known at least since last summer’s debt ceiling standoff in Congress that an economic slowdown was a high probability outcome if policy makers failed to reverse steep retrenchments in public investments that create jobs and strengthen growth. The...

In the mid-1800s, a cousin of Charles Darwin by the name of Francis Galton wrote a series of works expanding on an old idea of selective breeding in human beings. Galton’s theory became known as eugenics. At its core, eugenics was underpinned by an assumption that talent and genius were hereditary traits, and that deliberate breeding could improve the human race. Within decades, intellectuals were spending their entire careers studying these ideas, quickly spawning a number of different fields dedicated to ‘racial sciences.’ Scholars began closely examining racial differences and building volumes of statistics on everything ranging from intelligence to...

Maryland Gov. Martin O’Malley signed into law a package of tax increases Tuesday targeting six-figure earners, tobacco users and companies engaged in real estate transactions to cover record spending on education. In a two-hour ceremony, it was easily the most recognizable measure O’Malley (D) signed but hardly the most popular. Rather, union members, minorities and interest groups crowded the State House to celebrate more than 200 lesser-known and often narrowly tailored bills. They passed the General Assembly with little fanfare but, taken together, will color the state’s social and political identity a slightly deeper shade of blue. The bills included...

Borrowing Your Way Out Of Debt And Other Normal Abnormalities By Bill Bonner 02/20/12 Buenos Aires, Argentina – Dow up 45 points on Friday. The 10-year T-note right on the 2% yield mark. Almost all the news is good. It looks like recovery is finally here. Or, are we just getting used to a punky economy…where even a little improvement looks like a boom? As far as we know, the US economy is still in a Great Correction…with plenty more correction ahead. But people get used to correction…and used to the feds pumping in cash and credit to keep things...

The U.S. Senate, in an unusual procedure, cleared the way Thursday for the U.S. to lift its borrowing authority by $500 billion to $15.19 trillion, enough to keep the support federal government borrowing through late January or early February. The action came under an unusual legislative procedure spelled out under the August agreement to raise the U.S. debt ceiling and avoid a U.S. credit default. In a 52-45 vote, the Senate blocked an attempt by Republicans to slow down the process that will result in the $500 billion debt-ceiling increase. The increase stems from a deal between Congress and the...

If you've been watching the news today, you know the stock markets are plunging. The markets have only been open about four hours, but the DOW has already plunged over 300 points, update, make that over 600 points.. Everyone knows this is because Standard and Poor downgraded the credit rating of the USA from AAA to AA+. Add in the fact that they downgraded the credit of institutions such as Freddie Mac and Fannie Mae for being too reliant on government (shocker!), are mulling downgrades of Britain and France, and said they might downgrade the USA again in a few...

The White House is pushing back against the growing narrative that Obama is "sitting on the sidelines," as reported by the New York Times yesterday, and letting Congress do all the work. As John Boehner spent the night trying to wrestle members into place to support his debt ceiling deal, Valerie Jarret reminded reporters yesterday that it was President Obama who was losing sleep over the issue. "He's getting absolutely no sleep. He's working tirelessly, meeting with his economic team, doing a lot of outreach, exploring all kinds of possibilities for compromise," Jarrett said. Chief of Staff William Daley...

  Amy Winehouse Economics David C. Stolinsky July 28, 2011 Amy Winehouse’s mother Janis stated that she believed it was “only a matter of time” before her daughter died.− News item Let me apologize in advance for using the name of a recently deceased young woman as a descriptor of our economic problems. But I mean no disrespect for Amy Winehouse. On the contrary, my disrespect is aimed at those responsible for wrecking our economic system to the point that the only options remaining are rehab or premature death. Beautiful, talented, wealthy Amy Winehouse was found dead at age...

But sometimes there's less than meets the eye. Generally, banks that repaid CPP funds did so with cash raised from earnings, or by raising new outside capital. In finance and banking you always have to read the fine print. And if you go back to the report, you'll notice that the fine print accompanying the entries for each of the above exits makes reference either to Footnote 49 or Footnote 50. Footnote 49 reads: "Repayment pursuant to Title VII, Section 7001(g) of the American Recovery and Reinvestment Act of 2009 using proceeds received in connection with the institution's participation in...

Ron Paul's recent idea on how to ease the national debt is hardly original but none the less worthy of consideration. He has proposed what leftist critics of the status quo monetary system have been proposing for decades: that money printing should be used to fund the government. To give Ron due credit, he is not proposing exactly that. More precisely, he is proposing that the Fed should tear up a bundle of its Treasury securities, which would lower our overall debt total bringing us below the current debt ceiling. Still, the mechanics are identical, if not in reverse order....

Half way into a third year of economic recession during his term, President Obama offered his advice to families suffering from the effects of high unemployment and home mortgage defaults. “First, don’t spend all your money,” Obama said. “As hard up as you may be, your finances can’t be in as bad a shape as the government’s. Chances are the government is going to need more of your money. What you’ve saved could be crucial to keeping government up and running.” “Second, there’s a difference between saving and investing,” the President went on. “Saving just means you haven’t spent the...

About a year ago Zero Hedge posted an article titled: "Record Number Of Americans Using Retirement Funds As Source Of Immediate Cash" after a report by Fidelity uncovered that "plan participants with loans outstanding against their 401(k) accounts had reached 22 percent versus 20 percent a year earlier." It is now time to revisit this very important topic because if recent press reports are true, last year's record number has just increased by another 50%. "On "The Early Show" Thursday, financial journalist and Newsweek columnist Joanne Lipman said, "Right now we have 30 percent of people who have 401(k)s have...

Yesterday, Tuesday, Treasury Secretary Timothy Geithner gave a speech in New York on the debt default crisis, which tried to shift blame for the nation's finances away from the Administration (reported by USA Today: "If Republicans try to impose that plan on this country as a condition for raising the debt limit, then they will own the responsibility for the first default in our history, with devastating damage to the nation." Talk about chutzpah! First, as Treasury Secretary, Geithner is the Administration official most responsible for monitoring the spending as well as the revenue-raising of the federal government. It is...