We hear about the problems of U.S. government debt and deficits all the time. In an election year, politicians make claims about how they will work to solve these problems while keeping benefits in place and leaving taxes low. In reality, solving the budget deficit will require painful tradeoffs that are politically unpopular. Let’s roll up our sleeves, crunch some numbers and identify the major tradeoffs.

To get a better sense of how current budget problems are working against each other, let’s take a look at the U.S. government’s income statement. The government’s revenues come primarily from taxes and social insurance and retirement receipts, while its expenses are made up of the government’s entire budget.

According to the Office of Management and Budget’s (OMB) historical tables for the Budget of the U.S. Government for fiscal year 2011, here are the estimated figures for what the government’s income statement would look like for 2010:

Revenues

Individual Income Taxes                                   $936 billion

Corporation Income Taxes                               $157 billion

Social Insurance & Retirement Receipts            $876 billion

Excise Taxes                                                    $73 billion

Other                                                               $124 billion

Total Revenues                                     $2.165 trillion

Expenses

Health & Medicare                                           $829 billion

Social Security                                      $721 billion

Defense                                                            $719 billion

Income Security                                                $686 billion

All Other Expenses                                           $577 billion

Interest Expense                                               $188 billion

Total Expenses                                     $3.720 trillion

Net Income (Deficit)                                         ($1.556 trillion)

Before we discuss what each of these line items means, we should put the magnitude of these numbers in perspective. According to the Bureau of Economic Analysis — part of the U.S. Department of Commerce — U.S. gross domestic product (GDP) for 2010 is expected to be around $14.5 trillion. This means that the U.S. government budget, at $3.7 trillion, makes up just over 25% of the U.S. economy.

The Bottom Line

So let’s cut right to the chase. The bottom line is that under current OMB projections, the deficit for fiscal year 2010 will come to about $1.6 trillion. That means the government will have to borrow $1.6 trillion to cover expenses because it does not have enough revenues.

Currently, the total U.S. debt stands at around $11.9 trillion ($4.3 trillion held by federal government accounts and $7.5 trillion held by the public). This means that the 2010 deficit will cause the national debt to grow by 13% in a single year.

We won’t get into which administrations had the largest deficits, however, the OMB’s historical tables for the budget have information on the budget, the deficit and national debt going back for decades for those who want to trace the current problem. The point here is that the deficit is unsustainable, and even if a large deficit is unavoidable during the current recession, significant measures will have to be taken soon to tackle this problem.

Government Revenues

Jumping back up to the top of the government’s income statement, we have revenues. The government’s revenues are composed of individual and corporate income taxes, social insurance and retirement receipts (Social Security and Medicare premiums), excise taxes and other receipts.

For fiscal year 2010, all these revenues are projected to amount to $2.2 trillion. This represents approximately 15% of GDP. In other words, if we were to tax the economy as a whole to fund all the government’s revenues for 2010, the effective tax rate would be 15%. The problem here is that these revenues are simply not enough to cover current expenses.

Let’s pretend, for a moment, that all of the government’s current expenses are absolutely necessary and that the deficit must be overcome by increasing revenues. There are essentially two ways this can be achieved: The economy can grow, increasing tax revenues or the tax rate can be increased to generate more revenues.

Increasing the tax rate is politically unpopular — especially if you had to increase it by 66% (10 percentage points), which is what it would take to balance the budget. But the economy would have to grow by 66% in order balance the budget while keeping tax rates where they are.

It is clear that growing our way out of the deficit is simply not possible in the short run, and in the long run, it is likely that expenses will continue to grow making it difficult to ever catch up. A 25% tax rate on the economy as a whole would balance the budget, but such a tax increase may wind up slowing down the economy and reducing revenues the following year.

Cutting into the Budget

Raising government revenues alone cannot solve the deficit, so let’s take a look at expenses. Health and Medicare are the biggest ticket items, racking up $829 billion — 5.7% of GDP. $462 billion of that is Medicare alone.

Next comes Social Security, which amounts to $721 billion — about 5% of GDP. Adding these first two expense items together comes to about $1.5 trillion or roughly the same size as the current deficit. But before we get excited about eliminating these programs to balance the budget, we have to remember that most of the $876 billion in social insurance and retirement receipt revenues are tied to these programs. Cutting them would mean losing the revenues from them as well.

Defense spending is the next big ticket item on the list, weighing in at $719 billion, roughly the same amount as social security. If we cut all three of these programs entirely — health, social security and defense — that would about balance the budget. Of course GDP would also fall by 15% because that’s what these programs amount to. Jobs would be destroyed and tax revenues would fall resulting in another deficit.

Let’s focus on this for a second. Completely eliminating the three largest spending areas of government — over 60% of the total budget — would still not quite guarantee a balanced budget. There are no painless solutions to the deficit. Defense, social security and Medicare are all programs that many Americans care deeply about, and significant cuts to any of them would hurt.

Moving down the expense list, Income Security amounts to nearly $686 billion. Income Security is composed of federal employee pensions, housing assistance, food stamps, unemployment insurance and other programs designed to provide a safety net for Americans during economic downturns. This line item is clearly going to be high during a recession and politically difficult to cut during hard times.

The next category we have on the government’s income statement is All Other Expenses. That’s right: Anything else we haven’t covered falls into this $576 billion bucket. All these programs are barely over one third the size of the deficit. When politicians want to sound tough on government spending, they pick some unpopular program from this bucket and attack it.

There may certainly be a lot of programs in this catch-all category that could be trimmed, but cut them all and you’ve only made a dent in the deficit. Here are just a few of the programs we’d lose if we wiped out this area: veterans’ benefits, transportation, education, international affairs, justice department, energy, science, agriculture, community and economic development, etc.

Finally we come to our last expense item — and perhaps the scariest. Interest expense on the national debt will amount to $187 billion. It may sound like a lot of money, but it’s actually a deal right now. Since our total debt is roughly $11.9 trillion, that would mean that our weighted average interest rate on that debt is around 1.6%.

As recently as 2006, that weighted average rate was around 2.7%. With today’s level of debt that would put interest expense at $317 billion. And every year we have a deficit, that debt continues to grow. With the growth in debt comes increased risk and increased rates on that debt. Interest expense can quickly get out of hand, and the only way to control it is to balance the budget and pay down the debt.

What to Cut?

No matter how you slice it, Americans will have to pay their debts — either through higher taxes or lost government services and benefits (or both). Yet, we still haven’t heard any politicians stand up and say they’ll take the heat for giving the country its medicine.

And this analysis of the deficit problem is in many ways overly simplistic, because it only looks at the current snapshot of the problem. In reality, the issues are even more complex given the fact that many government expenses will continue to rise (Medicare and Social Security obligations), and the source of revenues will fluctuate with the state of the economy.  But this makes it all the more imperative that politicians tackle this problem now, and that Americans make the hard sacrifices necessary to avoid bankrupting the country.

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About the Author:
 
Looking for charts and graphs on the U.S. budget deficit, visit www.financeocean.org.
 
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Back in the shadowy days of the Clinton administration of the stained black dress, wagging fingers telling us he did not have sex with that intern, and friends that got murdered with the Park Police in charge, we have a change that happened in 1994 that allowed the Clinton crew to change the Bureau of Labor Statistics. The methodology included an alternative unemployment rate that removed from the unemployment rolls those that were categorized as the long term discouraged workers which the BLS crossed off the list of those that were considered unemployed.

A Politically Skewed Manipulation

With a politically skewed manipulation of the real unemployment figures getting whittled down to 8.3%, when the real unemployed are figured in it looks like a more truthful picture is found at the logical number of 22.5%. The manipulation of the numbers by the BLS makes it look like the Obama Administration is making headway when in fact real unemployment, when you count in the totals for workers that are no longer looking, runs to 1920′s depression levels of the previous real number of 22.5% that John Williams of the “Shadow Government Statistics” who has railed for years that the fed twists the numbers to make them say what they want them to say.

What is a Depression?

The media in the financial world usually defines a financial depression as being a loss of 10% in the Gross Domestic Product (GDP) which is more than anything just a rule of thumb. Ronald Reagan once said, “Recession is when a neighbor loses his job. Depression is when you lose yours.”

Numbers Are Skewed for Political Reasons

In a world where the very thought of trying to analyze a macroeconomic happening measured in dollars in a world where cash is electronic debt, property is still declining in value, capital investments flows freely across economic borders, cheap labor immigrates across our southern borders uninhibited, and politicians leave the government’s biggest expenses off the books has become increasingly absurd over time. How could you ever try to figure out if the economy is expanding or contracting when the numbers used are skewed for political purposes?

News Release Says

A Feb. 2012 news release from BLS told the public that the rate of unemployment had fallen 0.2% from the previous 8.5% we previously had in Dec. of 2011. However, the part of the report that did not make the evening news is the BLS reports the U6 unemployment is 15.6%, U6 meaning those people that were marginally attached to the work force in what is now called the under employed, people looking for full time wages but had to settle for part time jobs. So in not releasing those figures, then dropping those workers who had fallen off the radar after looking for jobs for a year, it is quite clear what the present administration is trying to do. Williams reported that the stats of 8.3% that made the media sound bites were mathematically manipulated and just simply not believable.

Adding Back

Williams put it this way in a report, his official Alternative Unemployment Rate comes out to be 22.5% when you add back into the Bureau of Labor Statistics U6 numbers, the long termed laborers that have fallen off the radar, and have stopped looking for jobs the past year. The BLS of course only reports the U3 stats that are adjusted seasonally which was the 8.3% that was blared out over every news media station.

Keystone Nuked

You can tell just by looking at the BLS own fully reported stats that the nation is in fact in trouble, has been for quite some time, is getting better no time soon, and there seems to be no remedy on the horizon coming down the road. The torpedoing of the Keystone pipeline that was to run from Canada down into Houston Texas would have employed at the peak at least 100,000 jobs directly and another 20,000 jobs indirectly, has been moved to the back burner.

Jobless Recovery

The jobless recovery scenario is a little more nebulous, with the precise timing of the recovery unknown, with little growth for the future estimated, and in danger of turning into a double dip recession, the uncertainty of the foreign export markets, contractions in the European and Asian markets, the double dip looks like the ice cream of the future.

Obama Stimulus a Bust

While the Obama stimulus package looks like a bust, the call for more recovery money not looking good, the pundits and the economists saying that whatever economic growth we do have will not sufficiently reduce the unemployment numbers and the figures will be much higher than normal, the look for economic growth looks grim for 2012 with little or no growth predicted.

The Straight Ahead Future

Looking into this crystal ball into the straight ahead future, while car sales have been good, manufacturing up slightly, and enough money flowing into the treasury to pay the necessary bills on time, if things just stay the same the double dip still looks like it could happen with the jobless recovery in full bloom. Those who adhere to variants of the jobless recovery say the USA is headed for a prolonged jobless recovery where only certain parts of the economy will recover while other segments will remain stagnant.

The Truth Is Different

What we really have waiting for us is historical warning signs that there are increasing numbers of consumer bankruptcies and mortgage defaults, credit debt is out of sight, there is also the unknown impact of enough possible bank failures to render the FDIC insolvent, the possibility of a U.S. state like California going bankrupt, or a possible crash in the derivatives market. Not speaking to the fact that being 4 trillion in debt will do anything good for the future economy or that the out of control printing of money by the Fed might have on our inflation scale when the working class will be unable to keep up. My take on this is the future looks so bright I have to wear shades.

Sincerely,
Gary Kent Boyd | My Blog

Originally seen here.

Times Are Tough, But An Upbeat Outlook Will Prevail

To the Editor:

Today, the news is dominated by the story of 33 Chilean miners being rescued after 69 days trapped more than two thousand feet below the Earth’s surface. It’s a profound story of love, faith, redemption, and of the bright side of human nature. Look at what we can do for each other when we put forth our best efforts!

Metaphorically speaking, we are all trapped underground at different times in our lives. Maybe there was a time when your job, for instance, made you feel like a king in a castle… but now (after things went badly and shook your confidence) you feel trapped under the rubble of it all. Perhaps you are feeling your age, and what was once a strong body that would obey your every command now feels trapped under years of fat-building sloth and avarice. Maybe you used to wake up with smile on your face and a song in your heart, but now, after a steady diet of bad news and setbacks, you feel like you’re trapped in a funeral procession. On bad days, it can even feel like your own!

They say you are what you eat… I think the same is true of your mind. You want to be informed and engaged, but with so much bad news out there, it’s hard to feed your mind anything like a balanced diet, and it’s easy to slide into negativity, anxiety, even depression. Great, positive stories like today’s report on the miner rescue do seem to come by too infrequently – so take some time today to absorb it. Reflect on how heroic the rescuers have been, and how patient and faithful the miners must’ve been. Is there a lesson in all this for you? Like the miners being pulled back to the surface, see if you can pull something up out of yourself that will help you escape whatever’s trapping you. It may be as simple as the realization that, for all your troubles and woes, you have it good. You are lucky. You’re blessed. You’ve been sleeping in a bed for the last 69 days, not in a smelly hole half-a-mile below the ground.

Then, take action. Action is the best prescription against the greatest threat to your well-being (worry). If your job is crumbling, make a new one for yourself. Starting a home-based business could be like drilling a hole to the surface through which you can escape if things go badly. If you’re feeling fat and lazy, make a change… you can at least start drinking more water, taking a good vitamin, and refusing some of the processed food-garbage you sometimes find within your reach.

And you can seek out the good news. Upbeat, “feel good” stories are hard to find these days (and you REALLY want to mute those campaign commercials)… but if you dig around, occasionally you find a nugget of pure gold.

by Michael D. Hume, M.S. 

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About the Author:
 
Michael Hume is a speaker, writer, and consultant specializing in helping people maximize their potential and enjoy inspiring lives. As part of his inspirational leadership mission, he coaches executives and leaders in growing their personal sense of well-being through wealth creation and management, along with personal vitality.
Those with an entrepreneurial spirit who want to make money “one less thing to worry about” can learn more about working with Michael at http://oneyearplan.net/michaeldhume
Anyone wanting to jump-start their vitality can browse through the best (and most travel-friendly) nutraceuticals on the market at http://shop.enivausa.com/239824
Michael and his wife, Kathryn, divide their time between homes in California and Colorado. They are very proud of their offspring, who grew up to include a homemaker, a rock star, a service talent, and a television expert. Two grandchildren also warm their hearts! Visit Michael’s web site at http://michaelhume.net
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We sit at the table of crisis but also at the table of opportunity. Clearly we must bail out the mistakes of “Wall Street”. Let’s fix it all for good.

One Trillion dollars for stabilizing the markets…why stop there?

How about printing TEN TRILLION DOLLARS and shipping all of those dollars to those that hold our National Debt?

The underlying problem is that the price of real estate is sliding. The solution to fixing this is to create inflation so that real estate stabilizes and rises.

Printing more money will create that inflation.

Paying off our National Debt will create 30% more available money in our National Budget and allow us to fix Social Security for good.

Most of the debt is held by foreign entities…if we ship actual “cash” overseas it will come back very slowly if ever. What it will do is establish the “dollar” as the global currency because so much of the trade that will occur overseas will be done in the “cash” dollars that we ship to pay off the debt. We limit visitors to our country to transporting no more than $10,000 in cash at any one time. With the Patriot Act we make it difficult to move money into the country… so this TRILLIONS of dollars would hit us slowly.

We deregulated everything. Now “Wall Street” has created derivatives on everything… this cannot continue. This needs to be fixed. “Margin Requirements” need to be placed upon every form of leverage… taking an asset and leveraging it 30 to 100 times its worth just isn’t prudent. It is time that we get back to sound banking principles. We switched from the “Gold Standard” and replaced it with a “Real Estate” backed currency… it is time that we make this more than just implied. Merge Freddie and Fannie into one entity and clear the log jam by allowing a mortgage to any person or entity regardless of credit history as long as they put up 30% of the value of the property – 20% if there are solar panels on the roof contributing electricity to our power grid.

Now if we end our dependence on foreign oil over the next five years we will have surplus money to begin spending on building our failed infrastructure.

Sincerely,
Michael Douglas Carlin

Carlin is the author of “A Prescription For Peace” (available at Amazon.com) He is credited with the quote: “Our work will not be done until every man, woman and child alive has three square meals a day, a roof over their heads, access to quality health care, personal security, an education, and a job.”

Source:http://www.articlesbase.com/politics-articles/fix-it-all-1325095.html

We can have peace in our lifetime if we all do our part.

This must be a partnership of every individual, non-profit organization, corporation, and government – all working together to bring the basic needs to all of humanity.

It is time for humanity to grow up. Our “Identity Crisis” is ridiculous. We run around like little spoiled brats sweeping our messes under the carpet rather than deal with them in a forthright manner. Turning a blind eye to problems like homelessness ends up costing more than facing the problem with housing, meals, and services that recycle lives and get them back on the road as productive members of society.

The debate between Socialism and Capitalism continues because of the merits of both systems. We hear the entrepreneur say, “I pulled myself up by my own bootstraps and was never given a thing…why should we give them anything?” We also hear those that have been helped by social programs say, “I reached out to the government for help during a time of crisis in my life and now, I own my own business.” The engine of capitalism cannot be refuted. It is what has driven the global economy. The benefits of socialism cannot be refuted either. That is why the debate is so compelling.

The overused phrase, “give a man a fish and he eats for a day, teach a man to fish and he eats for a lifetime” also has merits. We need to assume nothing during the education process that teaches men, women and children to “fish”. We need to understand that in today’s complicated world the process of teaching men women and children to fish is a process that may take time. Not everyone has the ability to fish while learning. The reason why we should help people that can’t pull themselves up by their own bootstraps is that it is the right thing to do. Helping people while they learn is more humane and costs less than sweeping them under the carpet.

Let’s put the debate of Capitalism and Socialism to rest. Turning a blind eye to people who have no ability to “fish” is no longer acceptable. A layer of socialism where not only do we teach men, women and children to “fish” but where that burden is shared by government, corporations, non-profits, and individuals, fueled by Capitalism for those who take personal responsibility and want all that capitalism provides. Two systems living side by side coexisting and flourishing.

Let’s move the debate forward to renewable systems that prepare and plan for the next thousand years.

This is A Prescription For Peace:

1. Food
2. Shelter
3. Health Care
4. Personal Safety
5. Education
6. Livelihood
7. Empower Women
All leading to HOPE

Thomas Jefferson wrote the words: “We hold these truths to be self evident that all men are created equal and are endowed by their creator with certain unalienable rights that among them are life, liberty and the pursuit of happiness”

If we have the right to life then we have the right to three square meals a day, a roof over our head, access to quality health care, personal security, an education and a job. For how could we ever begin to experience liberty or pursue happiness without the basic needs being met.

Sincerely,
Michael Douglas Carlin

Carlin is the author of “A Prescription For Peace” (available at Amazon.com) He is credited with the quote: “Our work will not be done until every man, woman and child alive has three square meals a day, a roof over their heads, access to quality health care, personal security, an education, and a job.”

Source:http://www.articlesbase.com/politics-articles/capitalism-vs-socialism-why-not-have-both-1325103.html

The United States has been in a recession since December, 2007, as defined by the National Bureau of Economic Research, a private, nonprofit research organization. But the American people, and the Obama administration along with the democrat majority congress, seem to be at odds on how to fix the American economy.

A robust economy means companies expand which results in job creation. Currently, the American people are not spending because many are not working, and those who are working are spending less, most likely due to the possibility of losing their job. Current unemployment rate stands at 9.6% as of August, 2009. A decrease in spending by the American people results in a decrease in company profits, company non expansion, and more layoffs.

Reporting on a survey by Watson Wyatt, a consulting firm, the HRSpecialist.com reported in November of 2008 that one-fourth of U.S. employers plan to have staff reductions during the following calendar year. We are now seeing this come to fruition for 2009.

So how can the US economy improve? Improvement being defined as two consecutive quarters where we do not have negative growth in the GDP (gross domestic product). The following is what we call the Steps to Economic Improvement. These are steps for consideration which hopefully result in a healthy bipartisan discussion between our elected congressman and their constituency. These steps may result in non-recessionary growth of our economy.

You may or may not agree with these steps, but at a bare minimum, these are points to consider, and ideally result in a healthy discussion with our elected congressmen, which at last check, is one of the unchanged notions of a free democratic society.

Steps to Economic Improvement:

1) The first step is to realize that it is business and not government that creates jobs and wealth within the American society.  This is where we believe is the heart of the problem. It is evident that the Obama administration believes it is government that will lead Americans to economic prosperity. This is why the federal government has put forth a $780 billion stimulus package. So where is this money really going. Let’s take a look at the breakdown. (source Republican Senate office, CNN.com AC360)

$780 Billion Stimulus Package:

MORE THAN $43 BILLION IN TRANSPORTATION INFRASTRUCTURE INVESTMENTS
$27 BILLION FOR HIGHWAY, ROAD AND BRIDGE INVESTMENTS
$8.4 BILLION FOR PUBLIC TRANSIT INVESTMENT
$2 BILLION FOR HIGH SPEED RAIL
$1.3 BILLION FOR FAA AIRPORT IMPROVEMENT FACILITIES AND EQUIPMENT
$850 MILLION FOR AMTRAK
$250 MILLION FOR GRANTS TO STATES FOR INVESTMENT IN HIGH SPEED AND INNER CITY PASSENGER RAIL
$100 MILLION TO MARITIME ADMINISTRATION FOR ASSISTANCE TO SMALL SHIPYARDS
$76.8 BILLION IN EDUCATION INVESTMENTS
$39 BILLION FOR STATE FISCAL RELIEF TARGETED DIRECTLY FOR EDUCATION
$13.9 BILLION FOR PELL GRANTS
$13.5 BILLION FOR SPECIAL EDUCATION FUNDING
$10.4 BILLION FOR TITLE I
$6.4 BILLION FOR WATER AND SEWER INFRASTRUCTURE
$3 BILLION FOR JOB TRAINING
$3.25 BILLION FOR WORKFORCE INVESTMENT PROGRAMS
$160 MILLION FOR JOB CORPS
$87 BILLION IN TEMPORARY AND TARGETED MEDICAID RELIEF TO STATES
$5 BILLION FOR SUPPLEMENTAL GRANTS TO PUBLIC HOUSING AUTHORITIES FOR CAPITAL NEEDS
$4.7 BILLION FOR STATE AND LOCAL ENERGY EFFICIENCY BLOCK GRANTS
$4.4 BILLION FOR SMART GRID
$2.9 BILLION FOR WEATHERIZATION PROGRAMS
$2 BILLION FOR ADVANCED BATTERY MANUFACTURING
$7 BILLION FOR LOAN GUARANTEES FOR STANDARD RENEWABLES
$800 MILLION FOR CONSTRUCTION OF PORTS OF ENTRY
$500 MILLION FOR FIREFIGHTERS ASSISTANCE GRANTS
$1.2 BILLION FOR NATIONAL SCIENCE FOUNDATION

As part of the 2010 budget proposal, the Obama administration has also proposed additional measures to attempt to stabilize the economy, including a $2–3 trillion measure aimed at stabilizing the financial system and freeing up credit. In a nutshell, auditors from the Congressional Budget Office have said that Obama’s budget would produce $9.3 trillion in deficits over the next decade.

This is a large chunk of change that needs to be provided by the American taxpayer! But the question is, will all of this spending help the long term growth of the US economy? Growth being during the period of not just the next few years, but rather 10 to 15 years. We believe it will not and here is why.

2) These programs burden the tax payer. History has shown that long sustained economic growth can not take place when the tax payer is over burdened by a federal deficit. Also, when the government spends money they do not have, they print more money, which results in a devaluation of the US dollar. This results in inflation.

3) Small businesses employ just over half of U.S. workers. How do you define a small business. The Office of Advocacy defines a small business for research purposes as an independent business having fewer than 500 employees. In examining the $780 billion stimulus package, you can see that there is no real help for small business. Remember, job creation is needed for economic recovery.

4) The socializing of America will not result in long term economic growth. The massive spending that the Obama administration has proposed will result in an even greater tax burden to the American people.

Most Americans believe in the frame work and meaning of The Constitution of the United States. The first words of the Constitution “We the People” make it clear that our government was established to serve the people. The essence of a democracy was eloquently stated by President Lincoln in his Gettysburg Address “that government of the people, by the people, for the people, shall not perish from the earth.” This simply means that our elected president and congress have a responsibility to listen to the American people.

And it can be said that most Americans do not want a socialistic society for the United States. Government needs to stop spending the American tax dollar, simply because an escalating government deficit will not result in an overall improvement in our economy.

5) Programs such as Cash for Clunkers, auto industry bailouts, and the like, only in the end increase the tax burden on the American people. These massively expensive programs do very little to improve the viability and strength of most small business. Based on 2008 figures, there are 155 million workers in the United States. The car industry accounts for about 13 million of these workers. Therefore, most Americans will not benefit from the bailout of the auto industry. There is only a marginal at best improvement in the economy from such programs.

6) We do applaud the Obama administration for the injection of capital into the financial institutions, because for small business to flourish, there needs to be capital available, and commercial banks and other depository institutions are the largest lenders of capital to small business.

7) The economy will do much better when companies are left to compete in the market place with minimal government involvement. A case in point, the Reagan administration had a policy of less government during the 1980s. This resulted in long term economic growth. This is the exact opposite of what the Obama administration is trying to do.

The Obama administration was given a bad economy when Barack Obama took office. But the Obama administration has taken a bad situation and made it much worse. Many economists believe that our economy would return anyway, with minimal government involvement. In terms of the economy, the government many times creates or prolongs problems and really does not solve them. A case in point, the deregulation of the banking industry which resulted in sub-prime lending. This created an eventual financial collapse, which resulted in the down turn in our economy and our current economic meltdown.

To conclude, the concept of minimal government is an important component for a strong American economy. Letting companies naturally compete within a free democratic society, with minimal government involvement, produces a robust economy, which benefits all Americans. The writers of the Constitution of the United Sates, our founding fathers, believed that the role of government in the lives of people should be minimal. Should we not adhere to the principles of our Constitution?

By letting your voice be heard, it is the American people who in the end control the destiny of the United States. And in the end, it is the American people who will control the destiny of the American economy. Go to your congressman’s website and contact them, discuss these points, express your opinion, and let them know how you feel. It is your right and duty as an American citizen.

Sincerely,
Thomas Sullivan

Sullivan is a web publisher and developer who resides within the Boston, MA area. He is the creator and webmaster of many job seeking sites, such as Sales Representative Jobs, Bookkeeping Jobs, and Programmer Jobs.

Article Source:http://www.articlesbase.com/politics-articles/how-to-improve-the-us-economy-a-political-perspective-1295859.html

How much is one billion dollars? On the other hand, even a bigger question, how much is one trillion dollars? We hear on the news every day our government is spending a billion dollars here and a billion dollars there. Most of us have grown numb to hearing those large amounts so much that very few of us even stop and think how much money that really is.

Back in December 2007 when George Bush was president, someone sent me an e-mail complaining how much our politicians were proposing spending in New Orleans after the hurricane. The amount was $250 billion. The person writing the e-mail was extremely upset with the Bush administration thinking about spending that kind of money. The person that sent the e-mail back in December 2007 stated the following five pieces of information.

A. A billion seconds ago it was 1959. B. A billion minutes ago Jesus was alive. C. A billion hours ago, our ancestors lived in caves. D. A billion days ago, no one walked on earth on two feet. E. A billion dollars ago was only 8 hours and 20 minutes ago (at the rate the Bush administration was spending it.)

A year later, the Bush administration voted to spend $750 billion to bail out the banks. Sense then the Obama administration has proposed to spend four times that amount. I can only assume the original person that was upset about the $250 billion and sent me that first e-mail has had a stroke or massive heart attack and died over today’s government spending.

For a little more perspective about the number one billion, the current number of stars in the Milky Way is estimated to range from 100 to 400 billion. A tightly packed stack of new $100 dollar bills totaling a billion dollars would be 4,000 feet high or about three Sears Tower buildings stacked one on top of each other. A stack of new $100 bills totaling one trillion dollars would be 789 miles tall or about equal to the distance from New York City to Chicago, Dallas to Atlanta, and Los Angeles to El Paso, Texas or the distance from Washington, DC to Jacksonville, Florida.

One trillion dollars is truly a huge amount of money. To pay off a trillion dollars of debt at a dollar a second would take about 32,000 years. This years Federal Budget just reached the 4 trillion dollar mark. That amount of money made up of tightly stacked new $100 bills would stack 3,156 miles high, about equal to the distance from Anchorage, Alaska to Honolulu, Hawaii or from Boston, Mass. to Ireland, England, or Spain. Almost unbelievable isn’t it?

In many ways, our new young President is awesome. He made history by being the first Black President of the United States of America and weekly he is making history with all of his new changes. He is bright, handsome, articulate and possibly the smoothest politician in history. You might say he is to politics what Denzel Washington is to Hollywood and many Americans love him. We want him to be success leading this wonderful country of ours on to greatness. However, he has surrounded himself with Democrats and Republicans, who want to remain in his favor, remain in power and ride his coattails into history. As a “family first” thinking American this massive government spending is unsustainable and will break our country, the numbers are just too large.

For any young people reading this, at the present rate of government spending (about $53,900 a second or $4.657 billion a day) each and every one of you will have to pay the government a minimum of $100 more a week for the rest of your life just in new taxes (or what ever they will call it) just to make a dent in what they are planning to spend. That does not count the future increased cost of electricity, water, gas, heating oil, gasoline, and food that is attached to this environmental (cap and trade) program.

It is estimated that the average family of four will pay an additional $20,000 per year for these items by 2035 due to cap and trade. This is without any personal extra benefit over what you have right now. That does not include the cost of the medical insurance you will be forced to buy whether you want to or not and the new taxes that will go along with this so-called free medical coverage for everyone.

I urge all of you young people to study politics and pay attention to what is going on. Learn the names of your Senator and Congressman, and follow how they vote. Write them, call them, text them, twitter them, email them or see them in person and let them know how you think they should vote on any issue. Always be very respectful but let them know if they vote against you on the issues, you will vote against them in their next election.

If they do not vote in whatever way you think is in your best interest vote them out of office. It does not matter, if you vote for a Republican, a Democrat or an Independent vote for someone who shares your same views and values. If you are ever going to retire, you are going to have to stay on top of things (unfortunately, that includes politics). You will have to budget your own money, save for your retirement and your government should be doing the same for you.

For those of us that are already retired we must do the same. We can no longer just vote straight Democrat or straight Republican. Things are changing so fast we must become much sharper. We must stay on top of the issues. We must pay attention to how the people we put into office vote on the issues, especially when it comes to how much of our money they are spending. Many of our politicians are voting to spend hundreds of millions of dollars without even knowing what is in the bill. That would be like buying a million dollar house without ever seeing it and having the real estate person say, “It is a real good buy just trust me and sign here.”

Unless you are born wealthy, it takes most people a lifetime to accumulate one million dollars or more. When our politicians spend one billion dollars (1,000 million dollars), they are spending the equivalent to one thousand lifetimes of wealth accumulation. When they say they are going to spend a trillion dollars that is equal to a million lifetimes of wealth accumulation. That means that many of our young people that have the potential of accumulating a million dollars in their lifetime will not be able to do so because of this wild spending in Washington by both parties.

When you look at it that way it becomes somewhat overwhelming doesn’t it? This wild spending (no matter what they call it) affects us all like a big tax increase. At some point, this out of control spending will affect our very freedom and democracy. Let your politicians hear from you today about the issues.

Sincerely,
Carl Wheeler

Wheeler is the Author and Publisher of http://www.sixsaturdaysaweek.com

Have you been laid off from your current job? Are you looking for employment? With so many layoffs and a struggling economy what do we do? I think that everyone has skills, talents and qualities that they can contribute to society, if they so choose. I also believe that even though the economy is struggling we can rise above it and come out better on the other side. Remember the old saying; what doesn’t kill you, only makes you stronger.

Instead of seeing gloom and doom I’ve chosen to look at our struggling economy as an opportunity to serve and help my community with my skills and resources that are available to me. Maybe you will decide to do the same? Do you ever consider that there is something out there that would be more rewarding and that you may actually truly enjoy? Maybe you’re already doing exactly what you love to do and just want to get your name out there? Regardless of the fact that people are getting laid off from work, there ARE certain jobs out there that will always be needed and could even be considered recession proof.

If you have children, at some point you are going to need child care. You may not have the time to give your aging parent the attention they deserve and need, so you’ll need to find a companion to help them. Do you have a pet? Who is going to take care of them if you have to go out of town? If your car breaks down, do you know a good mechanic? Maybe you cut your own hair, but if not, you’re eventually going to need a good a barber or beautician. What about your home, auto and life insurance? I personally have an agent that actually called to tell me that I qualified for a discount and saved me forty dollars a month! Would your insurance agent do that?

Recently, the woman that does my taxes told me a story that a few of her clients wanted her to teach them how to do their own taxes because they had been laid off and couldn’t afford to pay her. Instead of snubbing her nose at them, she told them she would still do their taxes and they could pay her when they could afford to, but she asked if they would please refer their family and friends to her. She ended up getting new clients because of her kindness, amazing!!

There are so many exceptional people in your community that provide personal services, which you may not be aware of. Maybe you are one of them? Like I said before, YOU have special talents and skills that would benefit YOUR community.

My name is Kim Cross, and I’m the founder of NeighborhoodProviders.com. I live in the small town of Newton Falls, Ohio and have seen first hand the effects of layoffs. I decided maybe there was something I could do that would be of value to help my community. So, with the help of my partner, Bob Baumann, we created a company that is dedicated to giving you the tools and resources to help you find a personal provider or employment in your neighborhood.

Please note that Neighborhood Providers truly believes in supporting local communities and that the small business owners are the backbone to society. To show our support Neighborhood Providers will yearly donate 5% of all the advertising sales back into the communities that use our services. Donations will be made to local community centers or non profit organizations that support local communities. We also have a volunteer program for individuals or families in need, NPVP-Neighborhood Providers Volunteer Program. If you or someone you know is struggling and in need of assistance please contact 877-756-1955 or send an email to npvp@neighborhoodproviders.com.

If you would like to volunteer your services to an individual or family in need please contact us at npvp@neighborhoodproviders.com or go to www.neighborhoodproviders.com for more details and contact information.
In closing, we would like to invite you to tour Neighborhoodproviders.com. It is our hope you will take advantage of the resources provided to you. We want YOU to thrive and rise above any negative influences and focus on YOUR talents and special qualities that only YOU have. Become an active member of our community!
Respectfully,
Kim Cross
Kim Cross is the CO-Founder and President of Neighborhood Providers .

First let me say I’m no expert. I’m just an average person trying to make a living, enjoy life with my family, but it is my perspective. Many good people can agree or disagree on this topic without being disagreeable.

We have seen our stock market accounts fall approximately (40) forty percent over the past year. We have see major banking institutions failing and we have all seen our government bailing failed companies out. I realize they may see information that we are not privy to, but basic common sense says that we probably should not be bailing out companies that will fail later regardless of what we do now.

In regards to the stock market many people think that the market will go up (40) forty percent and everything will be fine, but the problem is if you had $100,000 and it’s now worth $60,000 and the market goes up (40) forty percent than you have $84,000 not $100,000. You can see that the market has to go up much more to reach the prior level. Will it go up again? History shows that it will, but it will take time and current retirees need their money now.

The politicians use our emotions against us and sell it to the American people as a must do action or helping another person out. They give you part of the facts. In my opinion they do not tell you all of the facts. For example, the trillions of dollars spent will have to be paid back. Who will pay it back? It will be you and I and our children and perhaps our grandchildren. I guess all I’m saying is don’t treat us as though we are stupid. Give us all the facts, not just the ones that make the case for one side of the argument.

I’m not against helping people so they don’t loose their retirement, but we do have to realize that the money the tax payer pays to help them effects other families. It may indeed cause other people not to retire as planned or at a minimum be forced to delay their hard earned, long waited retirement. Be honest about the facts!

It’s like the housing meltdown. Many of the politicians forced banks to give sub prime loans, but now the very same politicians won’t stand behind their decision. Bill O’ Reilly of Fox News called one of them a coward as I recall. People make mistakes, but don’t point the finger at someone else when you were a major part of the problem. Stand behind your decisions and admit to your mistakes. After we forced the banks to make these sub prime loans we then decide to bail out companies like AIG and they act like a company that is making a fortune rather than a company in need of repair. Spending our money like its extra cash that has to be spent or lost. Sad!

I’m no expert, but I know fairness when I see it and this is not it. When will we get government officials that will be honest with the people that elected them? I’m sad to say we probably won’t and we are part of the problem.

Here is why. For example, lets say you have two people running for public office. The first person tells you that they will have to have major cuts that will effect your pocket book and it will take a while for things to get better, but they will get better over time if we all cut back and work together. You then have person two says that things are horrible, but we have to spend more money, give people stimulus checks and find ways to help people out to make things better now. The government budget is much like a family budget you cannot spend more than you make with one exception the government can print more money that has to be paid back at some time in the future. Which person do you think will win?

You got it the person who paints a rosy picture. Most people care as long as it does not affects them or their family. They don’t want to give up anything they have now. You may be thinking that these bailouts fall into this category, but I personally don’t think they do, because they are such a massive amount of money the American people have to have all of the facts and be part of the decision making process.

Oh, you will hear the arguments they don’t have time and it’s an emergency or we elected the politicians to make decisions for us. There are many ways they can find out what the majority of the people want. That’s just an excuse, because they know the people will not go along with them. They already know what most people think by polls that show they do not agree, yet the go ahead and spend the money. It’s not a particular party, because both parties are at fault.

The affects of these events will cause more loss of jobs, long-term effects on the markets and foreclosures in the United States.

What can we do? I think we can write articles like this, call our politicians, send them emails and at least make an effort. Our children and grand children deserve at least that.

People who are currently retirees or will be entering retirement over the next (5) five years deserves better.

Thank you for taking the time to read this article and letting me vent.

Michael Comeau has been owner of many successful businesses over the years including his current online business which can be viewed at [http://www.workfromhome4dollars.com/Article-2009-Economy.php]http://www.workfromhome4dollars.com/Article-2009-Economy.php. You may also find more articles by Michael Comeau at [http://www.workfromhome4dollars.com]http://www.workfromhome4dollars.com.

Article Source: http://EzineArticles.com/?expert=Michael_Comeau http://EzineArticles.com/?The-Economic-Crisis,-How-Will-it-Affect-You?&id=1905056

I was under the impression we lived in a democratic capitalistic society, which encouraged and supported ambitious people to go after their dreams, where only the strong survive in a business arena?
There are still intelligent individuals out there with that burning desire to succeed, and willing to take the risks required to make their ideas a reality. New entrepreneurs are the ones willing to work countless hours, roll up their sleeves doing the dirty jobs if necessary. Perhaps the heads of these large corporations looking for bailouts forgot that basic principal, which is most likely the very reason for their companies’ poor performance.
There should be a contractual clause saying in order for these bigwigs to get their bailout money; they should be required to work on the floor for 6 months as laborers low person on the totem pole. Learning once again what a hard physical day’s work is about? In that time frame no fancy clubs, no private planes, no big offices, just pure meat and potatoes basic work principals.
These North American auto executives have fallen asleep at the wheel, or are resting on their laurels. Foreign carmakers have had a better pulse on technological auto trends, with a focus on lower fuel usage per gallon for decades. It would seem more people are buying foreign automobiles anyways, why put good money into bad bailing out a losing cause.

From my viewpoint take some of those billions of bailout dollars allocate them to people like auto works for retraining in other industries. The balance of the money being used for new entrepreneurs, with a solid business plans, who require startup capital in order to employee those out of work employees afterwards. Bailing out these companies seems like nonsense to me.
It is as though they were not given the opportunities to change their business practices in the past, but chose to virtually sit back and bleed their companies dry, not offering a life raft to any of their drowning laid off employees. We have allowed the foreign car market to over take our North American industry, time to switch gears get back to basics. Either make the import taxes so high people can not afford those cars, therefore having no alternative but to buy locally made automobiles, or move on to greener pastures.

If people such as Benjamin Franklin, Ben & Jerry, Bill Gates were never given a chance to excel, the world would not be what it is today. We are actually doing a disservice to ourselves because a few of these new entrepreneurs could make a positive change in our way of living, just like the fellows I mentioned above. Instead we are shelling out money to people with no vision, providing themselves luxurious lifestyles on our tax dollar backs.

This whole big business franchise box store life we live is very convenient, but limiting our growth as a nation, and in my opinion a few steps away from communism. Everyone eats the same places, shops at the same places, stands in line at the same places, and in doing so squishes out the chances of a new entrepreneur being successful providing maybe better service, North American made products and better job security with growth potential for employees.
Does anyone out there remember the days of a person could start in a low end job position and move up to become upper management, or even the president of the company? Working for established large corporate stores at minimum wage or just above with no future is not a way for national prosperity. The only thing these type jobs have provided is an economic debt for their workers who are not earning enough to survive.

As the title of this article implies “We need to support the concept of small business again to change the economy”, because in way of thinking without those new entrepreneurs we might as well throw in our own proverbial economical prosperity towels.

Arnold Nadler has been an entreprenuer for over the last 25 yrs, and enjoys writing articles that inspire thought and change.

Article Source: http://EzineArticles.com/?expert=Arnold_Nadler http://EzineArticles.com/?We-Need-to-Support-the-Concept-of-Small-Business-Again-to-Change-the-Economy&id=1905175