Obama Tax Hikes will hit Retirees, Middle Class, Veterans, Medicare…

Associated Press
September 19, 2011

WASHINGTON (AP) — It’s not just millionaires who’d pay more under President Barack Obama’s latest plan to combat the deficit.

Air travelers, federal workers, military retirees, wealthier Medicare beneficiaries and people taking out new mortgages are among those who would pay more than $130 billion in government revenues raised through new or increased fees.

Airline passengers would see their federal security fees double from $5 to $10 for a nonstop round-trip flight and triple to $15 by 2017, raising $25 billion over the coming decade. Federal workers would face an additional 1.2 percentage point deduction from their paychecks to contribute $21 billion more for their pensions over the same period. Military retirees would pay a $200 fee upon turning 65 to have the government pay their out-of-pocket Medicare expenses. They’d also pay more for non-generic prescription drugs.

And it’ll cost corporate jet owners a new $100 fee for each flight.

The fees aren’t taxes. They’re charged to people who use government services or receive benefits such as taxpayer-subsidized health care, and they typically defray the government’s cost of providing a service. The fee on corporate jets and other private passenger planes, for example, would raise about $1 billion a year to help finance the cost of air traffic control. Recreational flyers won’t have to pay.

Many of Obama’s proposals are retreads from earlier budget proposals, including those submitted by his predecessors. Most have been rejected year after year. Some ideas, like requiring wealthier veterans to pay more for their health care, stir up opposition from powerful interest groups. Others, like the bigger security fee for flyers, seem too close to a ticket tax increase.

Administration budget documents describe the fees as savings.

But unlike Obama’s tax proposals, the new fees aren’t necessarily dead on arrival with Republicans. A group led by Vice President Joe Biden had tentatively agreed to increase the airline security fee before talks between the White House and Congress collapsed in June. The Biden-led group was also weighing an increase in pension contributions by federal workers, an idea that has riled organized labor and other Democratic-friendly interest groups.

“Why (would) the administration … propose a Social Security payroll tax holiday in its jobs bill, but simultaneously suggest a tax increase for middle-class federal workers?” asked Joseph Beaudoin, president of the National Active and Retired Federal Employees Association.

Another new fee would increase by one-tenth of a percentage point the fee that mortgage giants Fannie Mae and Freddie Mac charge lenders to guarantee repayment of new mortgage loans. The administration says the fee increase would add $15 a month to the monthly cost of an average new mortgage. Even without existing mortgages being affected, the fee increase would raise $28 billion over 10 years.

Some of the fees tilt toward the arcane. There’s a plan to save $3 million a year by developing an electronic records system for hazardous waste shipments. Another would produce $7 million more a year by giving the federal government a 50 percent share of receipts from geothermal leases on federal lands instead of 25 percent, with the remainder going to the states.

Another proposal would charge $4 an acre on non-producing oil and gas leases on federal lands, raising $1 billion over a decade. The idea is to prod energy companies to get their leases into production or give them up and allow others to develop them.

Debt Deal: ”It’s like Curing a Drunk with Vodka”

By David Lawder
Reuters
August 1, 2011

The tentative deal to avoid a crushing debt default is at best a mild relief for the U.S. economy that nearly stalled in the first half of the year and has yet to show signs of any realistic pickup.

The plan for $2.4 trillion in spending cuts over a decade, if backed by lawmakers, would help lift some of the uncertainty that has weighed on investors, businesses and consumers unsettled by talk about a possible new and deep U.S. financial meltdown.

Still, it does not decisively remove the threat that the nation’s AAA credit rating could be downgraded, an action that would raise borrowing costs across the board, and the prospect of further cuts ahead will cut short any celebrating.

“This will have minimal impact on the economy. The cuts are not there for the first couple of years, which really makes you wonder if they’re really going to happen at all,” said Peter Morici, an economics professor at the University of Maryland.

The prospect of spending cuts is the last thing the U.S. economy needs right now, many commentators say.

Economists were stunned on Friday when data showed the U.S. economy grew just 0.4 percent in the first three months of this year — perilously close to contraction — and picked up unimpressively to 1.3 percent in the second quarter.

Against the backdrop of the weak economic recovery, the divided political parties in Congress appear to have agreed on one thing early on in their dispute over how to raise the U.S. debt ceiling: that spending cuts to narrow the deficit should be phased in slowly. They will be phased in from 2013.

President Barack Obama told reporters on Sunday that the initial discretionary cuts, expected to be about $917 billion, “wouldn’t happen so abruptly that they’d be a drag on a fragile economy.” He added that “job-creating” investments in education and research would be preserved.

But the bulk of the austerity has yet to be defined.

About $1.5 trillion of the planned savings will be decided by a bipartisan congressional commission, leaving unanswered the question as to whether the United States has the political will to tame the country’s growing debt pile once and for all.

Troy Davig, U.S. economist at Barclays Capital, estimated that the deal would only cut $25-30 billion from government spending in the first year, which could shave about a tenth of a percentage point off economic growth.

“It’s not a major drag on growth but when the economy is only growing a point and a half, a lot of economists feel that this is not the right time to be finding fiscal restraint. We will be shifting from massive stimulus to massive restraint.”

Steeper and faster spending cuts could have dealt a knockout blow to an economy reeling from high fuel prices, bad weather, Japan’s earthquake and a depressed housing market, plus a labor market that shows few signs of recovery.

LITTLE SCOPE FOR STIMULUS

Proposals discussed just a week ago included possible new fiscal stimulus measures, such as extending payroll tax cuts for employees and offering them to employers as well.

There appeared to be no room for them in Sunday’s preliminary deal which is expected to be voted on in the Senate on Monday and sent to the House of Representatives for approval. The bipartisan panel, which must draft more cuts by November, could revisit the issue.

There could be some relief among U.S. employers and consumers that taxes won’t rise under the new, hard-fought deal and that the worst-case scenario has been avoided.

The talks have been punctuated by warnings from the Obama administration that financial chaos would ensue if the $14.3 trillion federal borrowing limit is not raised by Tuesday.

That angst has added to a pile of worries slowing consumer spending decisions such as car purchases, according to Detroit executives. Existing home sales in June fell sharply due a big jump in canceled sales contracts.

Obama, too, said he has been concerned about the debt limit battle’s impact on consumer and business confidence. He said he hoped Sunday’s deal “will begin to lift the cloud of debt and the cloud of uncertainty that hangs over our economy.”

Any relief, however, is likely to be short-lived. U.S. jobs data on Friday will probably prove another reminder of the weak U.S. economy. Unemployment is expected to remain at 9.2 percent, according to a Reuters poll.

The budget deal “does nothing to restore household and corporate confidence,” said Mohammed El-Erian, chief executive of bond fund investment giant PIMCO.

“So unemployment will be higher than it would have been otherwise, growth will be lower than it would be otherwise, and inequality will be worse than it would be otherwise,” El-Erian told ABC’s This Week with Christiane Amanpour.

Just as Washington’s political leaders have run out of money to throw at the U.S. economy, the Federal Reserve looks lacking in ammunition too.

The U.S. central bank waged an massive experiment in monetary policy over the last few years to prevent the 2007-2009 recession from spiraling into a depression, slashing interest rates to zero and pumping $2.3 trillion into the ailing economy by buying debt,

The Federal Reserve is not expected to rush in to make up for the loss of any stimulus to boost growth.

Atlanta Federal Reserve President Dennis Lockhart said on Friday there would be a “very high bar” for more stimulus.

At least the deal taking shape in Washington would push the scary prospect of a U.S. debt default out until after the 2012 presidential election. But investors worldwide will still worry about the ability of the United States to avoid future downgrades of its debt, a move that would probably push up borrowing costs and act as yet another drag on the economy.

“Talk about kicking the can down the road, this is probably the biggest can that’s ever been kicked — appointing another commission to do the heavy lifting another day,” Yale University economist Stephen Roach told Reuters Insider.

The Debt Deal Meaning? It’s Meaningless

by Zeke Miller
Business Insider
August 1, 2011

The “historic, bipartisan compromise” reached to raise the debt limit does not end the struggle to reign in the federal deficit — in fact, it pushes the most difficult decisions off into the future.

More surprising, the debt deal actually cuts almost nothing now–it just promises future cuts that may or may not materialize.

There are very few specific cuts in the deal — and the $1 trillion in immediate cuts are almost entirely constituted of caps on future spending. And those caps are not required to be honored by future congresses.

The “real” spending cuts to current programs will come out of a bipartisan committee of Representatives and Senators, which is charged with finding an additional $1.5 trillion in savings from the federal deficit.

But White House and Republican leaders appear split on exactly what the so-called “Super Committee” can do.

In a presentation to his caucus, Speaker of the House John Boehner said it would “be effectively…impossible for [the] Joint Committee to increase taxes,” even though it could consider reforming the tax code.

White House officials strongly pushed back on that remark, saying revenue-increasing reform is possible — even though it almost certainly would not be able to get through Congress.

The committee is modeled on “BRAC” or the Base Realignment and Closure Commission, whose recommendations are presented to Congress for a straight up-or-down vote with no amendments allowed. Instead of non-partisan commissioners, each congressional leader will appoint three members of Congress to the committee.

If the Super-Committee can’t reach an agreement, or their recommendations cannot pass Congress, deep “real” spending cuts, which are painful to both sides, would take effect. For Democrats, entitlement cuts are at risk, while Republicans would see cuts to defense spending.

Additionally, President Barack Obama has the ability to veto an extension of the Bush tax cuts if he deems the committee’s solution insufficiently “balanced.”

So, again, other than cuts to federally subsidized student loans to graduate and professional school students, the debt deal actually cuts NOTHING now, and only promises future reductions that may never materialize.

In short, for the past month, Congress has been arguing about little more than an agreement to reach an agreement at some point in the future. Your tax dollars at work.

G20: Banks must hold on to Cash for coming Crisis

The International Crime Syndicate, better known as the G20, determined at its last meeting that the collapse and consolidation of the global economy will begin around 2012 and finish in 2016 with the liquidation of all countries who are in debt with the IMF and the World Bank.

By Luis Miranda
The Real Agenda
June 29, 2010

Bankers and G20 members have direct and indirect ways to speak to the public. At the end of the latest G20 meeting in Toronto, both

From right to left: Canadian Prime Minister Stephen Harper, UK Prime Minister David Cameron and U.S. President Barack Hussein Obama.

groups spoke very clearly about what they have in mind for the foreseeable future. First, they are all in the run to help the process of global consolidation. Second, they will extend the current depression by slowly cutting the available cash for lending. Third, they will continue their austerity programs in a country by country basis to slowly kill their economies and consolidate each nation. Fourth, now that they have robbed the people’s taxes through their rescue packages, they plan to rob shareholders by putting the burden of future rescues on them when the next crisis comes. Fifth, they are disingenuous or irresponsible by thinking that putting aside 130 billion pounds will create any security for the economy, given that only the derivative schemed debt ascends into the quadrillion of dollars. And lastly, they intend to seed and water the final implosion, which according to their communique, can come as soon as 2012.

If all these sounds confusing, please let me explain.

Let’s start by remembering that the G20, and mainly the G8 were the ones who caused the current financial crisis. They did it through their front companies e.g. banks, which implemented a series of corrupt schemes to bankrupt economies and whole countries through investment and betting into risky and sometimes nonexistent financial products e.g. derivatives. These schemes were allowed to exist given the fact that for the past two decades most of the regulations put in place to stop financial fraud were eliminated as an excuse to enable “free markets”. What deregulation effectively permitted was the creation of bogus investing plans which the banks later offered to countries, states and municipalities -often times through governments- and used them to acquire all their infrastructure and cash through the issuance of debt or fraudulent investment.

It has become clear that the G8 and the bankers are not interested in improving current economic conditions. They simply want to extend the crisis as long as they need to, in order to execute their final plan of global implosion. That is what emerges from the idea of cutting lending money and asking banks to hoard the cash for the next crisis, as the G20 communique says. Although 130 billion pounds is peanuts in comparison with the debt most G8 countries hold today, the action of keeping the cash in reserve paints a clear picture of what the ‘leaders’ have in mind. What they want is a slowly and painfully grind down the economies in order to cause the greatest damage. Such policy will assure them the consolidation of more resources before the final blow to the global economy is given.

One of the most important tools the bankers have used along the last 100 years is to create an artificial bubble of money abundance -Fiat money- in order to get the countries and the public to trust them. This is what many describe as economic booms. But given the fact that the global economy is based on debt and fractional reserve banking, the only goal the money bubbles had was to hook up the greatest amount of debt on consumers to then pull the cash off the markets. By doing this, the bankers accelerate their consolidation process. Along with the reduction in lending, G8 nations agreed to continue the austerity plans in each individual country. Austerity will be implanted on the working class by cutting services such as police, hospitals, school funding, and social programs. This will in turn cause civil unrest, which is what the bankers want in order to officially freely unleash their military and technological control grid. A preview of what this grid would look like was seen on the streets of Toronto during the last G20 meeting. It was also seen during Argentina’s collapse in 2001.

The infamous rescue packages glorified by the IMF and the World Bank as the best way to avoid a complete collapse of the global economy -which as explained before was caused by the bankers themselves- were the biggest transfer of money and resources in the history of the world. Only the United States gave the bankers around $25 trillion in tax payer money so Goldman Sachs, Iberia Bank, JP Morgan Chase, Bank of America and others could pay their shareholders their chunk of the loot. See a complete list of what banks got the cash here. But those $25 trillion were not enough, of course. Germany for example, voted to give 66% of its annual revenue to the banks. Going by the G20’s communique it is clear they are planning another big collapse, possibly the last one. It is also clear they will have to rob someone else this time and that is what the bankers and the ‘leaders’ have said. They will stick the next rescue package to the banks’ shareholders -not to the big ones, though-. So if you have investments in any bank, it is advised to rescue yourself out of it before the new banking package comes along. Shamelessly, they will obligate the banks to hold billions so when the next crisis comes, taxpayers will not be burdened as if we don’t know those billions are the same they stole last 2009. Now that they consolidated and stabilized their fraudulent financial system, it won’t matter if other banks fail, because they are all covered.

The idea that 130 billion pounds is a safety net for a future crisis, or double dip recession as they like to call it, is preposterous. Derivative-produced debt is, depending who you ask, between $600 trillion and $1 quadrillion. According to Robert Chapman, from the theinternationalforecaster.com, buying derivatives is not investing.  It is gambling, insurance and high stakes bookmaking.  Derivatives create nothing.” According to the Bank of International Settlements, the derivative bubble has grown exponentially to a point where the amounts negotiated under this scheme has long surpassed the world’s GDP. “Derivative trades have grown exponentially, until now they are larger than the entire global economy.”Credit default swaps (CDS) is the most common form of derivatives. CDS are bets between two parties on whether or not a company will default on its bonds. They are indeed illegal insurance policies, with no requirement to hold any asset. CDS are used to increase profits by gambling on market changes.

The WEB of DEBT in which the current economy was built throughout the past 100 years was the tool used in a process to reverse everything humans achieved. It was not unintended however, as this was the mechanism the globalist bankers planned on using from the beginning. Every time the world experienced a financial crisis like in 1929-1933, the grip of control tightened more and more. The measures to avoid a total collapse, as we were told, were not such. They were simply ways to postpone the imminent collapse.  But the measures the bankers implemented cannot be used forever. Sooner rather than later something will give in. The step by step, ad hoc and non-holistic approach of Fed and Treasury to crisis management has been a failure. . . . [P]lugging and filling one hole at [a] time is useless when the entire system of levies is collapsing in the perfect financial storm of the century. A much more radical, holistic and systemic approach to crisis management is now necessary,” says professor Nouriel Roubini. founder of Roubini Global Economics.

After turning the global economy into a service-based system, where no quality products are manufactured; after driving developing countries into massive debt while collapsing the economies of the western world, the bankers are ready for their last move: a one last crisis. According to the G20 communique, its members must cut their deficits by 2013, a process that already started. This process is supposed to end in 2016, when the nations should have stabilized their deficits. Cutting and then stabilizing deficits means that debtor countries will have to find a way to pay their debts in full to the IMF and World Bank according to the conditions imposed by those entities. Every country that does not pay in full will be liquidated and their resources will be automatically transferred to the globalist bankers. Imagine what happened to Argentina, Greece and Iceland in the last decade, but instead of being those countries, the debtors will be the United States, Spain, Portugal, England and Germany.