Speaking on one of the political television shows before the election, Vice President Joe Biden proposed to make a deal with Republicans on tax increases. Democrats, who just raised the Medicare tax by 0.9 percent on those earning over $200,000 ($250,000 for joint filers), want to increase their political capital by making the Bush tax cuts — due to expire this year — permanent. The sticking point is the $250,000 threshold at which Democrats want “the rich” to begin to pay higher tax rates. Biden said the Obama administration was willing to consider raising the threshold. “I don’t have any problem with wealthy people getting a tax cut. I mean, for real,” Biden explained. “I mean, these are good guys.”
Before the Internet, Robert Zoellick’s brief outline of suggested topics for the G20 meeting this week in Seoul, Korea, might have been considered just an interoffice memo. It appeared in London’s Financial Times, contained obscure references to arcane subjects that would be of interest only to international bankers determined to push their agenda for a world currency, and was written by a certified member of the internationalist “insider” cabal. But when Zoellick wrote that the “cooperative monetary system … should also consider employing gold as an international reference point…,” Internet bloggers picked up on it immediately, and the cover was blown.
Even though 151,000 new real jobs were added in October, according to the Bureau of Labor Statistics, the unemployment rate stayed at 9.6 percent. This announcement not only successfully masked the fact that fewer people were looking for work, which made the rate look better, but also that more people are staying unemployed longer.
Central planning seldom makes economic sense. However good a scheme looks on paper in some politician’s office, planned on the taxpayer’s dime, it's probably not worthwhile. If it really was a good scheme, then private enterprise would have already implemented the project.
Government never “stimulates” economic growth. Left quite alone, people engage in rational commerce guided only by enlightened self-interest. More crucially, government cannot predict the real consequences of its efforts to stimulate the economy. Republicans around the country are telling Americans that the ocean of dollars which the federal government spent on the future credit of our children in order to stimulate growth in America is actually being spent in China.
In yet another economically destructive ploy to “go green,” the Environmental Protection Agency has recommended an unprecedented barrage of harsh federal regulations on fuel efficiency standards for semi-trucks, buses, delivery vans, garbage trucks, and heavy-duty pickup tricks.
Let us be blunt: The mortgage foreclosure crisis, which first burst into full public view with Bank of America’s suspension of all foreclosures only a few days ago, has the potential to completely destroy the American real estate sector in an epic legal and economic meltdown that would make the crisis of 2007-2008 look like the proverbial Chinese tea party.
The notes of the latest meeting of the Federal Reserve, released on Tuesday, clearly show the Fed’s next step in trying to solve the problem it has created: Quantitative Easing II, or QE2 (qualitative easing is Fed-speak for increasing the money supply). The meeting lasted more than five hours and consisted of a debate about when to start the process: now, or later.