No Runny Eggs

The repository of one hard-boiled egg from the south suburbs of Milwaukee, Wisconsin (and the occassional guest-blogger). The ramblings within may or may not offend, shock and awe you, but they are what I (or my guest-bloggers) think.

Archive for the 'Politics' Category

March 25, 2010

The New York Times catches up to NRE – admits Social Security is running a cash deficit

by @ 10:50. Filed under Social Security crater.

It’s nice to see The New York Times catch up to what Ed Morrissey and I have been noting since September (with the first alarm bells rung in May), and what the Associated Press noticed ten days ago. I’ll go with Ed’s take on the catch-up:

We’ve been writing about this for the last few years, and when we wrote about it, we presented the entire political backstory, including how Barack Obama’s OMB Director Peter Orszag predicted in 2008, while running the CBO, that this day would come — in 2019. We included mentions of how Harry Reid and other Democrats insisted in 2005 that George Bush was scaremongering when he attempted to reform SSA through partial, elective privatization, and how they assured us that Social Security was safe for decades without reform.

Does the Times mention any of this? Not exactly. In fact, the name “Orszag” doesn’t appear once, nor does the name “Reid.” Guess how many times the name “Greenspan” appears in this article by Mary Williams Walsh? Five:

One thing Ed left out of that – in the FY2010 budget prepared by Orszag, he predicted there would be a $21 billion primary (cash) surplus in Social Security. Depending on whether one believes the OMB or the Congressional Budget Office, the primary deficit is somewhere between $29 billion and $34 billion, or a miss of $50 billion-$55 billion in a program with somewhere around $700 billion of cash outflow.

One more thing – that CBO $29 billion estimate might yet be low – it is unclear whether the money to pay for the second round of $250 pay-o…er, “stimulus” checks that Obama wants to hand out would come out of the “Trust Funds” or the general fund. If it’s the former, it would add another $12 billion to the former estimate, making that hole $41 billion.

Back to Ed:

Forget those two years of black ink, too. That will only happen under the rosiest of scenarios for economic growth and employment. As the recession’s effects continue, people will continue retiring earlier or not going back to work. SSA’s revenues will continue to plateau before dropping steeply as the rest of the Baby Boomers leave the workforce and demand their benefits.

Some people predicted this day would arrive at about this time; those were the people Democrats accused of attempting to frighten seniors out of their benefits. Some predicted that this day wouldn’t come for almost a decade longer than it did and argued that reform wasn’t necessary in 2005, when it may have helped extend SSA’s life. Those are the people making the economic decisions in the White House now.

The country’s in the best of hands.

That leads me to another item from the Times, this one from Monday (H/T – Allahpundit):

That leaves Social Security, the other big entitlement benefits program and one that Mr. Obama has suggested in the past that he is willing to tackle. While its looming problems are not of the scale of those afflicting Medicare, it now stands as the likeliest source of the sort of large savings needed to bring projected annual deficits to sustainable levels, many budget analysts agree.

And, they say, packaging future reductions in the retirement program that Democrats zealously defend with tax increases that Republicans typically oppose would have the makings of a grand compromise to shrink the debt.

“You would think that there ought to be a way to get together and talk about a balanced package of some changes in benefits and some increases in revenues that would actually help Social Security,” said James R. Horney, the director of federal fiscal policy at the Center on Budget and Policy Priorities, a liberal-leaning research organization….

Yet Representative Steny H. Hoyer, the moderate Democrat who is the House majority leader, gave a speech this month in which he called for the two parties to compromise on a mix of tax increases and benefit reductions to avert fiscal chaos. Among his options were proposals to gradually raise the retirement age for future Social Security recipients and to reduce benefits for those with high incomes.

I’ll ignore the misapplication of “moderate” to Hoyer. This was tried in 1983, with benefit reductions (in the form of taxation of benefits, and a raising of the “full-benefits” retirement age from 65 to 67) and tax increases (a 14% increase on both sides of the withholding tax and a 64% increase in the self-employment tax). At the time, it was deemed a “forever” fix. That “forever” fix has lasted 22 years on a combined yearly cash-surplus basis, almost certainly won’t last 30 years for the Disability Insurance portion of Social Security, and likely won’t last 50 for the bigger Old-Age and Survivors Insurance portoin.

I’ll go back to what I said last month when Obama floated the idea of lifting the cap on those taxes out in Henderson, Nevada:

As for Obama’s claim that eliminating the cap would make Social Security solvent long into the future, let’s take a quick look at that. Assuming that it has no effect on on the economy, removing the cap would increase the FICA/SECA tax take by roughly 21%. Some very-back-of-the-envelope number-crunching refreshes my memory of a semi-forgotten study that found that lifting the cap entirely would only delay the inevitable decline and collapse of Social Security by roughly 15 years. Ever-so-conveniently, that would move fund exhaustion barely beyond Obama’s life expectency.

March 24, 2010

Latest Thompson rumor – 75% there, final decision Easter week

by @ 7:04. Filed under Politics - Wisconsin.

The Weekly Standard‘s Stephen Hayes posted a pair of Tweets that strongly suggest that Tommy Thompson will in fact announce he’s running for the Republican nomination for US Senate to run against Russ Feingold, and that decision will come sooner rather than later:

Tommy Thompson doing what a candidate-to-be does prepping to run for Sen. Quit a corp board Friday. Final dec on vacation over Easter w/fam.

Those talking to Thompson generally believe he’ll run, seems gen interested in being a senator. One source says he’s 75 percent there.

Revisions/extensions (7:15 am 3/24/2010) – And the story has hit The Weekly Standard blog. Two items from the story:

  • That corporate board of directors Thompson resigned from is CNS Response, Inc., a health-care data company. That was more of a sideways move, as Thompson agreed to become chairman of its advisory board.
  • The latest Democrat-affiliated Public Policy Poll had Thompson down 3 to Feingold 47%-44%, a significant improvement over its previous poll in November (50%-41%). Meanwhile, Rasmussen recently had Thompson up 47%-45% (a narrowing of a prior lead), WPRI recently had Thompson up 51%-39%, and a GOP internal poll had Thompson up by 5 points.

March 23, 2010

Tuesday Hot Read – The Republican Party of Dane County “apologizes”

Lance Burri thoughtfully reposted an e-mail from the Republican Party of Dane County (for those of you outside Wisconsin, that would be the county with Madison as its county seat):

Republican Party of Dane County Apologizes For Its Opposition To Obamacare

We at the Republican Party of Dane County would like to publicly apologize for opposing the Obamacare health care bill. We have now seen the light and support it. There are a few reasons for our change of heart:

The Democrats are correct that the health insurance companies don’t make enough money. Obamacare will be the largest transfer of wealth to the health insurance industry in history. The Democrats are also correct that our budget deficit isn’t large enough. Moody’s has warned that passing this bill will likely cost the United States its AAA bond rating – and we agree with the Democrats in saying “good riddance!”

The Democrats are correct that it’s ridiculous that all Americans now have access to health care. Obamacare will dramatically decrease the number of doctors, and will dramatically decrease the amount of medical innovation in this nation. Who needs new cancer drugs anyway? More than 6% of United Kingdom citizens have reported pulling out their own teeth because they can’t get access to a dentist, despite “universal” health care. That’s the spirit!

Finally, we agree with Democrats that the electoral chances of the Democratic Party in 2010 are far more important than whether a new unfunded entitlement system that we’ll be stuck with forever is good for this nation. They have argued incessantly that even Democratic congressmen who hate the bill should vote for it because of the electoral consequences in 2010 and 2012. Absolutely!

So we applaud the Democratic Party. It takes a great amount of courage to simultaneously put aside the US Constitution, the laws of economics, the negative effects of a bill on the quality of health care in this nation, and the will of the people. Open the fridge and crack open a cold one, Democrats. You’ve earned it!

While you can put all the Republicans who actually live in Dane County in a phone booth, they sometimes do come up with a real winner.

Quote of the day – PlaceboCare edition

by @ 7:15. Filed under Politics - National.

The Godfather of the Badger Blog Alliance, Jib, broke his near-silence with this gem on the passage of PlaceboCare:

I’m not happy and I don’t have much to say except for this:

Dear President Bush,

If you are destined for low approval ratings, this is how you spend political capital. Wish you would have spent yours more wisely.

Toodles,
Jib

Point of order – outside the 2003 tax cuts (and a couple elements of the 2001 edition), the War on Terror, and the aborted attempt to reform Social Security, governing from the Left is pretty much how Bush spent his political capital – from the 2001 stimulus checks (repeated in 2008) to Medicare Part D, from No Child Left Behind to the 2008 stimulus checks, from the pre-TARP bailouts of certain well-connected Wall Street firms to TARP itself (and the attendant bailout of GM and Chrysler, which ultimately begat Government Motors and UAW Motors).

One item – because of a problem with Jib’s template, you have to head to his blog’s home page to comment.

March 22, 2010

Pay No Attention to That Flashing Red Light

From Bloomberg:

Obama Paying More Than Buffett as Bonds Show U.S. Losing AAA

Yup, in short order, we the American taxpayer are paying more than Warren Buffet and his green companies for debt.  Hell, we’re even paying more now than the Germans!

Haven’t the debt markets heard that the deficit problem has been solved?  Yeah, you see, we’re going to pay for 30 million more people to have all the health coverage they want, none of them will pay a dime for it and yet it won’t cost the government an extra nickle.  In fact, they’ve got this health thing so figured out that by paying for more people, we’re actually going to save money as a nation!

OK, to be fair, the article does say that part of the reason that the corporate debt yield is lower than the Treasury is that high credit companies don’t seem to be borrowing as much anymore.  Huh, why do you suppose that is?  Do they know something the Federal Government doesn’t?  Yeah, probably one thing; any money they borrow they’ll eventually have to pay back without the ability to make wage slaves of their customers.

We’re so screwed!

March 19, 2010

They Put One of Yours in the Hospital…

You put one of theirs in the morgue.

March 17, 2010

Wednesday HOT read – Field v. Clark

Yes, there is a reason why I fully-capitalized “HOT” in the title. Once you’re done reading the portion of the opinion of the Supreme Court in Field v. Clark (courtesy Justia.com) dealing with a challenge regarding differences between an “enrolled” bill as signed by the President and the same bill as voted out of Congress, your blood will be boiling at the worst decision of SCOTUS ever, yes, even worse than the Dred Scott decision.

First, a bit of background. Yesterday, Mark Tapscott kicked over an anthill when he found that Nancy Pelosi and Louise Slaughter are hypocrites when it comes to the Constitutional requirement that a bill that is presented to the President be voted on by both Houses in identical form. Ed Morrissey, among others, noted that the group Pelosi and Slaughter sided with in 2005 lost their challenge that the House passed a slightly-different (specifically, a two-character difference) version of a bill than the Senate, with the appellate court relying on Marshall.

That led me to the actual Marshall decision, and I note that, while there is a dissent-in-part, that dissent does not extend to this portion of the opinion of the Court. Rather than excerpt it, I’ll give you the entire section that deals with the differences between the “enrolled” and “voted upon” versions of the bill in question, starting at 143 U.S. 662:

MR. JUSTICE HARLAN delivered the opinion of the Court.

Duties were assessed and collected, according to the rates established by what is known as the “Tariff Act of October 1, 1890,” on woolen dress goods, woolen wearing apparel, and silk embroideries, imported by Marshall Field & Co., on silk and cotton laces imported by Boyd, Sutton & Co., and on colored cotton cloths imported by Herman, Sternbach & Co. 26 Stat. 567, c. 1244, § 1.

The importers severally protested against the assessment upon the ground that the act was not a law of the United States. Upon appeal to the Board of General Appraisers under the Act of June 10, 1890, known as the “Customs Administrative Act,” the decision of the collector in each case was approved, c. 407, secs. 14, 15, pp. 131, 137. The judgment of the board having been affirmed by the circuit courts of the United States in the respective districts in which these matters arose, the cases have been brought here for review.
The appellants question the validity of the Act of October 1, 1890, upon three grounds, to be separately examined.

First. The seventh section of Article I of the Constitution of the United States provides:

“All bills for raising revenue shall originate in the House of Representatives, but the Senate may propose or concur with amendments as on other bills. Every bill which shall have passed the House of Representatives and the Senate shall, before it becomes a law, be presented to the President of the United States; if the approve, he shall sign it, but if not he shall return it, with his objections, to that house in which it shall have originated, who shall enter the objections at large on their journal, and proceed to reconsider it. If, after such reconsideration, two-thirds of that house shall agree to pass the bill, it shall be sent, together with the objections, to the other house, by which it shall likewise be reconsidered, and, if approved by two-thirds of that house, it shall become a law. But in all such cases, the votes of both houses shall be determined by yeas and nays, and the names of the persons voting for and against the bill shall be entered on the journal of each house, respectively. If any bill shall not be returned by the President within ten days (Sundays excepted) after it shall have been presented to him, the same shall be a law, in like manner as if he had signed it, unless the Congress by their adjournment prevent its return, in which case it shall not be a law.”

“Every order, resolution, or vote to which the concurrence of the Senate and House of Representatives may be necessary (except on a question of adjournment) shall be presented to the President of the United States, and, before the same shall take effect, shall be approved by him, or, being disapproved by him, shall be repassed by two-thirds of the Senate and House of Representatives, according to the rules and limitations prescribed in the case of a bill.”
The Revised Statutes provide that

“Whenever a bill, order, resolution, or vote of the Senate and House of Representatives, having been approved by the President or not having been returned by him with his objections, becomes a law or takes effect, it shall forthwith be received by the Secretary of State from the President, and whenever a bill, order, resolution, or vote is returned by the President with his objections, and, on being reconsidered, is agreed to be passed, and is approved by two-thirds of both houses of Congress, and thereby becomes a law or takes effect, it shall be received by the Secretary of State from the President of the Senate, or Speaker of the House of Representatives, in whichsoever house it shall last have been so approved, and he shall carefully preserve the originals.”

The original enrolled act in question, designated on its face “H.R. 9416,” was received at the Department of State October 1, 1890, and, when so received, was attested by the signatures of Thomas B. Reed, Speaker of the House of Representatives, and Levi P. Morton, Vice-President of the United States and President of the Senate, and had thereon these endorsements:

“Approved October 1, 1890 BENJ. HARRISON”

“I certify that this act originated in the House of Representatives.”

“EDW. MCPHERSON, Clerk

It is made the duty of the Secretary of State to furnish to the congressional printer

“a correct copy of every act and joint resolution as soon as possible after its approval by the President or after it has become a law, in accordance with the Constitution, without such approval.”
That duty was performed by the Secretary of State with respect to the act in question, and the act appears in the volume of statutes published and distributed under the authority of the United States. Rev.Stat. §§ 210, 3803, 3805, 3807, 3808.

The contention of the appellants is that this enrolled act, in the custody of the Secretary of State and appearing upon its face, to have become a law in the mode prescribed by the Constitution, is to be deemed an absolute nullity in all its parts, because — such is the allegation — it is shown by the congressional records of proceedings, reports of committees of each house, reports of committees of conference, and other papers printed by authority of Congress, and having reference to House Bill 9416, that a section of the bill, as it finally passed, was not in the bill authenticated by the signatures of the presiding officers of the respective houses of Congress and approved by the President. The section alleged to have been omitted was as follows:

“SEC. 30. That on all original and unbroken factory packages of smoking and manufactured tobacco and snuff, held by manufacturers or dealers at the time the reduction herein provided for shall go into effect, upon which the tax has been paid, there shall be allowed a drawback or rebate of the full amount of the reduction, but the same shall not apply in any case where the claim has not been presented within sixty days following the date of reduction, and such rebate to manufacturers may be paid in stamps at the reduced rate, and no claim shall be allowed or drawback paid for a less amount than five dollars. It shall be the duty of the Commissioner of Internal Revenue, with the approval of the Secretary of the Treasury, to adopt such rules and regulations, and to prescribe and furnish such blanks and forms, as may be necessary to carry this section into effect. For the payment of the rebates provided for in this section there is hereby appropriated any money in the Treasury not otherwise appropriated.”

The argument, in behalf of the appellants, is that a bill, signed by the Speaker of the House of Representatives and by the President of the Senate, presented to and approved by the President of the United States, and delivered by the latter to the Secretary of State, as an act passed by Congress, does not become a law of the United States if it had not in fact been passed by Congress. In view of the express requirements of the Constitution, the correctness of this general principle cannot be doubted. There is no authority in the presiding officers of the House of Representatives and the Senate to attest by their signatures, not in the President to approve, nor in the Secretary of State to receive and cause to be published, as a legislative act, any bill not passed by Congress.

But this concession of the correctness of the general principle for which the appellants contend does not determine the precise question before the Court, for it remains to inquire as to the nature of the evidence upon which a court may act when the issue is made as to whether a bill, originating in the House of Representatives or the Senate, and asserted to have become a law, was or was not passed by Congress. This question is now presented for the first time in this Court. It has received, as its importance required that it should receive, the most deliberate consideration. We recognize, on one hand, the duty of this Court, from the performance of which it may not shrink, to give full effect to the provisions of the Constitution relating to the enactment of laws that are to operate wherever the authority and jurisdiction of the United States extend. On the other hand, we cannot be unmindful of the consequences that must result if this Court should feel obliged, in fidelity to the Constitution, to declare that an enrolled bill, on which depend public and private interests of vast magnitude, and which has been authenticated by the signatures of the presiding officers of the two houses of Congress, and by the approval of the President, and been deposited in the public archives as an act of Congress, was not in fact passed by the House of Representatives and the Senate, and therefore did not become a law.

The clause of the Constitution upon which the appellants rest their contention that the act in question was never passed by Congress is the one declaring that

“Each house shall keep a journal of its proceedings, and from time to time publish the same, except such parts as may in their judgment require secrecy, and the yeas and nays of the members of either house on any question shall at the desire of one-fifth of those present, be entered on the journal.”

Article I, Section 5. It was assumed in argument that the object of this clause was to make the journal the best, if not conclusive, evidence upon the issue as to whether a bill was in fact passed by the two houses of Congress. But the words used do not require such interpretation. On the contrary, as Mr. Justice Story has well said,

“the object of the whole clause is to insure publicity to the proceedings of the legislature and a correspondent responsibility of the members to their respective constituents. And it is founded in sound policy and deep political foresight. Intrigue and cabal are thus deprived of some of their main resources by plotting and devising measures in secrecy. The public mind is enlightened by an attentive examination of the public measures; patriotism and integrity and wisdom obtain their due reward, and votes are ascertained, not by vague conjecture, but by positive facts. . . . So long as known and open responsibility is valuable as a check or an incentive among the representatives of a free people, so long a journal of their proceedings and their votes, published in the face of the world, will continue to enjoy public favor and be demanded by public opinion.”

2 Story on the Constitution §§ 840, 841.

In regard to certain matters, the Constitution expressly requires that they shall be entered on the journal. To what extent the validity of legislative action may be affected by the failure to have those matters entered on the journal we need not inquire. No such question is presented for determination. But it is clear that in respect to the particular mode in which, or with what fullness, shall be kept the proceedings of either house relating to matters not expressly required to be entered on the journals; whether bills, orders, resolutions, reports, and amendments shall be entered at large on the journal, or only referred to and designated by their titles or by numbers — these and like matters were left to the discretion of the respective houses of Congress. Nor does any clause of that instrument either expressly or by necessary implication prescribe the mode in which the fact of the original passage of a bill by the House of Representatives and the Senate shall be authenticated or preclude Congress from adopting any mode to that end which its wisdom suggests. Although the Constitution does not expressly require bills that have passed Congress to be attested by the signatures of the presiding officers of the two houses, usage, the orderly conduct of legislative proceedings, and the rules under which the two bodies have acted since the organization of the government require that mode of authentication.

The signing by the Speaker of the House of Representatives and by the President of the Senate, in open session, of an enrolled bill is an official attestation by the two houses of such bill as one that has passed Congress. It is a declaration by the two houses, through their presiding officers, to the President that a bill, thus attested, has received, in due form, the sanction of the legislative branch of the government and that it is delivered to him in obedience to the constitutional requirement that all bills which pass Congress shall be presented to him. And when a bill thus attested receives his approval and is deposited in the public archives, its authentication as a bill that has passed Congress should be deemed complete and unimpeachable. As the President has no authority to approve a bill not passed by Congress, an enrolled act in the custody of the Secretary of State, and having the official attestations of the Speaker of the House of Representatives, of the President of the Senate, and of the President of the United States carries on its face a solemn assurance by the legislative and executive departments of the government, charged, respectively, with the duty of enacting and executing the laws, that it was passed by Congress. The respect due to coequal and independent departments requires the judicial department to act upon that assurance, and to accept as having passed Congress all bills authenticated in the manner stated, leaving the courts to determine, when the question properly arises, whether the act so authenticated is in conformity with the Constitution.

It is admitted that an enrolled act thus authenticated is sufficient evidence of itself — nothing to the contrary appearing upon its face — that it passed Congress. But the contention is that it cannot be regarded as a law of the United States if the journal of either house fails to show that it passed in the precise form in which it was signed by the presiding officers of the two houses and approved by the President. It is said that under any other view, it becomes possible for the Speaker of the House of Representatives and the President of the Senate to impose upon the people as a law a bill that was never passed by Congress. But this possibility is too remote to be seriously considered in the present inquiry. It suggests a deliberate conspiracy to which the presiding officers, the committees on enrolled bills, and the clerks of the two houses must necessarily be parties, all acting with a common purpose to defeat an expression of the popular will in the mode prescribed by the Constitution. Judicial action based upon such a suggestion is forbidden by the respect due to a coordinate branch of the government. The evils that may result from the recognition of the principle that an enrolled act in the custody of the Secretary of State, attested by the signatures of the presiding officers of the two houses of Congress and the approval of the President, is conclusive evidence that it was passed by Congress according to the forms of the Constitution would be far less than those that would certainly result from a rule making the validity of congressional enactments depend upon the manner in which the journals of the respective houses are kept by the subordinate officers charged with the duty of keeping them.

The views we have expressed are supported by numerous adjudications in this country, to some of which it is well to refer. In Pangborn v. Young, 32 N.J.Law 29, 37, the question arose as to the relative value as evidence of the passage of a bill of the journals of the respective houses of the legislature and the enrolled act, authenticated by the signatures of the speakers of the two houses and by the approval of the governor. The bill there in question, it was alleged, originated in the House and was amended in the Senate, but as presented to and approved by the governor did not contain all the amendments made in the Senate. Referring to the provision in the Constitution of New Jersey requiring each house of the legislature to keep a journal of its proceeding — which provision is in almost the same words as the above clause quoted from the federal Constitution — the court, speaking by Chief Justice Beasley, said that it was impossible for the mind not to incline to the opinion that the framers of the Constitution, in exacting the keeping of the journals, did not design to create records that were to be the ultimate and conclusive evidence of the conformity of legislative action to the constitutional provisions relating to the enactment of laws. In the nature of things, it was observed, these journals must have been constructed out of loose and hasty memoranda made in the pressure of business and amid the distractions of a numerous assembly. The Chief Justice said:

“Can anyone deny that if the laws of the state are to be tested by a comparison with these journals, so imperfect, so unauthenticated, that the stability of all written law will be shaken to its very foundation? Certainly no person can venture to say that many of our statutes, perhaps some of the oldest and most important, those which affect large classes of persons or on which great interests depend, will not be found defective, even in constitutional particulars, if judged by this criterion. . . . In addition to these considerations, in judging of consequences, we are to remember the danger, under the prevalence of such a doctrine, to be apprehended from the intentional corruption of evidences of this character. It is scarcely too much to say that the legal existence of almost every legisaltive act would be at the mercy of all persons having access to these journals, for it is obvious that any law can be invalidated by the interpolation of a few lines or the obliteration of one name and the substitution of another in its stead. I cannot consent to expose the state legislature to the hazards of such probable error or facile fraud. The doctrine contended for on the part of the evidence has no foundation, in my estimation, on any considerations of public policy.”

The conclusion was that, upon grounds of public policy as well as upon the ancient and well settled rules of law, a copy of a bill bearing the signatures of the presiding officers of the two houses of the legislature and the approval of the governor, and found in the custody of the Secretary of State, was conclusive proof of the enactment and contents of a statute, and could not be contradicted by the legislative journals or in any other mode. These principles were affirmed by the New Jersey Court of Errors and Appeals in Freeholders of Passaic v. Stevenson, 46 N.J.Law 173, 184, and in Standard Underground Co. v. Attorney General, 46 N.J.Eq. 270, 276.

In Sherman v. Story, 30 Cal. 253, 276, the whole subject was carefully considered. The court, speaking through Mr. Justice Sawyer, said:

“Better, far better, that a provision should occasionally find its way into the statute through mistake, or even fraud, than that every act, state and national, should at any and all times, be liable to be put in issue and impeached by the journals, loose papers of the legislature, and parol evidence. Such a state of uncertainty in the statute laws of the land would lead to mischiefs absolutely intolerable. . . . The result of the authorities in England and in the other states clearly is that at common law, whenever a general statute is misrecited, or its existence denied, the question is to tried and determined by the court as a question of law — that is to say, the court is bound to take notice of it and inform itself the best way it can; that there is no plea by which its existence can be put in issue and tried as a question of fact; that if the enrollment of the statute is in existence, the enrollment itself is the record, which is conclusive as to what the statute is, and cannot be impeached, destroyed, or weakened by the journals of Parliament or any other less authentic or less satisfactory memorials, and that there has been no departure from the principles in the United States except in instances where a departure has been grounded on, or taken in pursuance of, some express constitutional or statutory provision requiring some relaxation of the rule in order that full effect might be given to such provisions, and in such instances the rule has been relaxed by judges with great caution and hesitation, and the departure has never been extended beyond an inspection of the journals of both branches of the legislature.”

The provisions of the California Constitution, in force when the above case was decided relating to the journals of legislative proceedings, were substantially like the clause upon that subject in the Constitution of the United States. The doctrines of the above case were reaffirmed in People v. Burt, 43 Cal. 560. But it should be observed that at a subsequent date, a new Constitution was adopted in California under which the journals have been examined to impeach an enrolled bill. County of San Mateo v Southern Pacific Railroad Co., 13 F.7d 2.

A case very much in point is Ex Parte Wren, 63 Miss. 512, 527, 532. The validity of a certain act was there questioned on the ground that although signed by the presiding officers of the two houses of the legislature and approved by the governor, it was not law because it appeared from the journals of those bodies, kept in pursuance of the constitution, that the original bill, having passed the house, was sent to the senate, which passed it with numerous amendments, in all of which the house concurred, but the bill as approved by the governor did not contain certain amendments which bore directly upon the issues in the case before the court. The court, in a vigorous opinion delivered by Mr. Justice Campbell, held that the enrolled act, signed by the president of the senate and the speaker of the house of representatives and the governor, is the sole exposition of its contents, and the conclusive evidence of its existence according to its purport, and that it is not allowable to look further to discover the history of the act or ascertain its provisions. After a careful analysis of the adjudged cases, the court said:

“Every other view subordinates the legislature and disregards that coequal position in our system of the three departments of government. If the validity of every act published as law is to be tested by examining its history, as shown by the journals of the two houses of the legislature, there will be an amount of litigation, difficulty, and painful uncertainty appalling in its contemplation, and multiplying a hundred-fold the alleged uncertainty of the law. Every suit before every court where the validity of a statute may be called in question as affecting the right of a litigant will be in the nature of an appeal or writ of error or bill of review for errors apparent on the face of the legislative records, and the journals must be explored to determine if some contradiction does not exist between the journals and the bill signed by the presiding officers of the two houses. Where the law is to be declared by the court, it must inform itself as best it can what is the law. If it may go beyond the enrolled and signed bill, and try its validity by the record contained in the journals, it must perform this task as often as called on, and every court must do it. A justice of the peace must do it, for he has as much right, and is as much bound, to preserve the Constitution and declare and apply the law as any other court, and we will have the spectacle of examination of journals by justices of the peace, and statutes declared to be not law as the result of their journalistic inquiry, and the circuit and chancery courts will be constantly engaged in like manner, and this court, on appeal, have often to try the correctness of the determination of the court below as to the conclusion to be drawn from the legislative journals on the inquiry as to the validity of the statutes thus tested. . . . Let the courts accept as statutes, duly enacted, such bills as are delivered by the legislature as their acts, authenticated as such in the prescribed mode.”

In Weeks v. Smith, 81 Me. 538, 547, it was said:

“Legislative journals are made amid the confusion of a dispatch of business, and therefore much more likely to contain errors than the certificates of the presiding officers to be untrue. Moreover, public policy requires that the enrolled statures of our state, fair upon their faces, should not be put in question after the public have given faith to their validity. No man should be required to hunt through the journals of a legislature to determine whether a statute, properly certified by the speaker of the house and the president of the senate and approved by the governor, is a statute or not. The enrolled act, if a public law, and the original, if a private act, have always been held in England to be records of the highest order, and, if they carry no ‘death wounds’ in themselves, to be absolute verity, and of themselves conclusive.”

To the same general effect are Brodnax v. Commissioners, 64 N.C. 244, 248; Nevada v. Swift, 10 Nev. 176; Evans v. Browne, 30 Ind. 514; Edger v. Randolph County Comm’rs, 70 Ind. 331, 338; Pacific Railroad v. Governor, 23 Mo. 353, 362, et seq.; Lottery Co. v. Richoux, 23 La.Ann. 743. There are cases in other state courts which proceed upon opposite grounds from those we have indicated as proper. But it will be found upon examination that many of them rested upon constitutional or statutory provisions of a peculiar character, which, expressly or by necessary implication, required or authorized the court to go behind the enrolled act when the question was whether the act, as authenticated and deposited in the proper office, was duly passed by the legislature. This is particularly the case in reference to the decisions in Illinois. Spangler v. Jacoby, 14 Ill, 297; Turley v. County of Logan, 17 Ill. 151; Prescott v. Canal Trustees, 19 Ill. 324; Supervisors v. People, 25 Ill. 181; Ryan v. Lynch, 68 Ill. 160; People v. Baranes, 35 Ill. 121. In the last-named case, it was said:

“Were it not for the somewhat peculiar provision of our constitution, which requires that all bills, before they can become laws, shall be read three several times in each house and shall be passed by a vote of a majority of all the members-elect, a bill thus signed an approved would be conclusive of its validity and binding force as a law. . . . According to the theory of our legislation, when a bill has become a law, there must be record evidence of every material requirement, from its introduction until it becomes a law. And this evidence is found upon the journals of the two houses.”

But the court added:

“We are not, however, prepared to say that a different rule might not have subserved the public interest equally well, leaving the legislature and the executive to guard the public interest in this regard, or to become responsible for its neglect.”

The case of @ 73 U. S. 511, was relied on in argument as supporting the contention of the appellants. The question there was as to the time when an act of Congress took effect, the doubt upon that point arising from the fact that the month and day, but not the year, of the approval of the act by the President appeared upon the enrolled act in the custody of the Department of State. This omission, it was held, could be supplied in support of the act from the legislative journals. It was said by the Court:

“We are of opinion, therefore, on principle as well as authority, that whenever a question arises in a court of law of the existence of a statute, or of the time when a statute took effect, or of the precise terms of a statute, the judges who are called upon to decide it have a right to resort to any source of information which in its nature is capable of conveying to the judicial mind a clear and satisfactory answer to such question, always seeking first for that which in its nature is most appropriate, unless the positive law has enacted a different rule.”

There was no question in that case as to the existence or terms of a statute, and the point in judgment was that the time when an admitted statute took effect, not appearing from the enrolled act, could be shown by the legislative journals. It is scarcely necessary to say that that case does not meet the question here presented.

Nor do the cases of South Ottawa v. Perkins, 94 U. S. 260; Walnut v. Wade, 103 U. S. 683, and Post v. Supervisors, 105 U. S. 667, proceed upon any ground inconsistent with the views we have expressed. In each of those cases, it was held that the question whether a seeming act of the legislature became a law in accordance with the Constitution was a judicial one, to be decided by the courts and judges, and not a question of fact to be tried by a jury, and without considering the question on principle, this Court held, in deference to the decisions of the Supreme Court of Illinois interpreting the constitution of that state, that it was competent for the court, in determining the validity of an enrolled act, to consult the legislative journals.

Some reliance was also placed by appellants upon section 895 of the Revised Statutes, providing that
“Extracts from the journals of the Senate, or of the House of Representatives, and of the executive journal of the Senate when the injunction of secrecy is removed, certified by the Secretary of the Senate or by the Clerk of the House of Representatives, shall be admitted as evidence in the courts of the United States, and shall have the same force and effect as the originals would have if produced and authenticated in court.”

But referring now only to matters which the Constitution does not require to be entered on the journals, it is clear that this is not a statutory declaration that the journals are the highest evidence of the facts stated in them, or complete evidence of all that occurs in the progress of business in the respective houses, much less that the authentication of an enrolled bill by the official signatures of the presiding officers of the two houses and of the President, as an act which has passed Congress and been approved by the President, may be overcome by what the journal of either house shows or fails to show.

We are of opinion, for the reasons stated, that it is not competent for the appellants to show, from the journals of either house, from the reports of committees, or from other documents printed by authority of Congress, that the enrolled bill, designated “H.R. 9416,” as finally passed, contained a section that does not appear in the enrolled act in the custody of the State Department.

Allow me to translate that for you – as of right now, the ONLY court-acceptable evidence that an “enrolled bill” actually passed Congress, or was even introduced into either House of Congress, is the signatures of the Speaker of the House and the Vice President (or presumably the Senate President Pro Tempore) on said “enrolled bill”. That’s right – a troka of the Speaker, Vice President and President have had the power to unilaterally enact law regardless of the other 534 members of Congress and indeed the Constitution for the last 118 years.

March 16, 2010

Give them an inch, they’ll take you a mile

Mark Tapscott has this morning’s episode of Rank Hypocrisy. Paraphrasing Mark:

  • In 2005, due to a transcription error by the Senate secretary on a single item, the House passed a debt-ceiling-raising bill that was slightly different than the version that passed the Senate. The Senate clerk, realizing the error after the House passed it, changed the item, presented it to the presiding officers, who both signed it and sent it to President Bush, who proceeded to sign it.
  • Public Citizen filed suit in an attempt to annul the law (ultimately unsuccessful), saying that it violated the requirement that identitcal version of a bill be passed by both Houses of Congress before it becomes law.
  • Joining Public Citizen with amicus briefs – Nancy Pelosi, Louise Slaughter and Henry Waxman.

Nothing more needs to be said.

March 15, 2010

Would the “lockbox” have worked?

by @ 18:57. Filed under Social Security crater.

The Associated Press praised the AlGore “lockbox” in its story discussed earlier, and Glenn Reynolds and Andy McCarthy asked where the “lockbox” was, so I figure it’s time to explore what creating said “lockbox” would do for the current cash-negative situation. The very-short version is that while there would be actual money in the “Trust Funds” to pay for the cash shortfall, which still would exist at the same level with or without the “lockbox”, that same money would have already needed to be borrowed on the open Treasury securities market. The longer version is a bit lengthier.

First, let’s take a look at Social Security as it was at the end of January 2001. The Old-Age and Survivors Insurance (OASI) Fund was “worth” $945 billion, with the weighted average interest of the securities held at 6.640% and the average time to maturity at 6.914 years (note; while most of those securities have since matured and been rolled over into new securities, some of those securities don’t mature until 2015). The Disability Insurance (DI) Fund was “worth” $121 billion, with the weighted average interest of the securities held (which included some since-retired public-issue debt) of 6.426% and average time to maturity at 6.828 years.

Since then, the OASI Fund has taken in $630 billion more in cash than it has paid out (i.e. primary surplus) with $776 billion in interest credited to it, giving it a “value” of $2,350 billion. Meanwhile, the DI Fund has had a primary deficit of $10 billion with $93 billion in interest credited to it, giving it a “value” of $203 billion. Between February 2009 and January 2010, the OASI Fund has had a primary surplus of $23,504 billion (down from a $71,637 billion primary deficit between 2/2008 and 1/2009) with $107.901 billion in interest credited to it, while the DI Fund has had a primary deficit of $23.611 billion (up from $10,687 billion primary deficit between 2/2008 and 1/2009) with $10.467 billion in interest credited to it. Signifcantly, that’s an overall 12-month deficit of $13.144 billion for the DI fund.

Now, let’s try to define the “lockbox”. There’s actually several different flavors possible, involving what gets put into the “lockbox” (just the taxes received after creation, the “new” taxes and interest, the entirety of the “Trust Funds” immediately upon creation, the values of the various securities as they mature), and on what interest gets paid (just those items in the “legacy Trust Fund”, everything). Some of those scenarios are beyond my ability to model, so I’ll just take four of the relatively-easy-to-model scenarios, while noting that while economically it makes no sense to credit interest to funds in the “lockbox”, it would also be political suicide even as it would require cash that the Treasury doesn’t have.

First, I’ll take just “future revenues” locked away, with no interest credited to them, and the current “legacy Trust Funds” along with interest credited to them rolled over into fresh Treasury securities as they are now. I’m likely overestimating the interest that would have been credited to the “legacy Trust Funds”, which would get put right back into the Treasury as it is now, but it’s close enough for government work. The “lockbox” amounts would have been the 9-year amounts listed above (+$630 billion for OASI, -$10 billion for DI). That’s right – that DI “lockbox” would have been emptied by this point. Meanwhile, the “legacy funds” would have been about $1,520 billion for OASI and $179 billion for DI, bringing the total nominal OASI fund amount to about $2,150 billion. That would have moved up the fund-exhaustion dates by a couple years. Assuming nothing in the budget would have been cut, the 9-year deficit spending would have increased by $640 billion, or an average of about $71 billion per year.

Next, I’ll add the interest earned by the “legacy funds” to the lockbox as cash. Since it no longer would have compounded, that interest would have been a bit less than in the first option, or about $470 billion for OASI and about $57 billion for DI. However, since it would have been added to the “lockbox”, both OASI and DI “lockboxes” would have been in positive territory (+$1,100 billion for OASI, +$47 billion for DI). However, since the “legacy funds” would have remained at the January 2001 levels, that would have left the total nominal funds at $2,050 billion for OASI and $177 billion for DI. Again, that would have meant the funds would be a bit closer to exhaustion, and it would have increased the 9-year deficit spending by $1,157 billion (or roughly $129 billion per year).

Third, I’ll look at the full-on “lockbox”, immediately liquidating the entirety of the “Trust Funds”, putting everything in the “lockbox”, and foregoing all future interest payments. Because interest earned in January 2001 would have been paid out, the total amount going into the “lockbox”, would have been about $956 billion for OASI and $122 billion for DI. That would have created a rather massive deficit for 2001, as to create that “lockbox”, the federal government would have needed to come up with $1,078 billion. With only primary surpluses and deficits affecting the “lockbox”, that would have left the balances at $1,586 billion for OASI and $112 billion for DI. That would have really cut into the lifetime of the funds, but they would at least have been fully-funded until exhaustion. Further, the 9-year deficit spending would have further increased by the same $640 billion as the first scenario.

Finally, I’ll take that full-out “lockbox” in scenario three, but still credit the interest. As I noted above, while it would fly politically, it would make no sense economically, as the Treasury, and by extension, we the taxpayers, would be paying for the use of money that we wouldn’t be able to use. The only difference between that scenario and the current scenario is that instead of $2,554 billion in unfunded IOUs, there would be $2,554 billion in cash. Of course, that would also mean the 9-year deficit spending increase would have been that same $2,554 billion.

The Associated Press starts to catch up on the Social Security Crater

by @ 13:04. Filed under Social Security crater.

(H/Ts – Ed Morrissey and Owen)

The Associated Press finally noticed that the cash Social Security is taking in won’t cover its current obligations:

For more than two decades, Social Security collected more money in payroll taxes than it paid out in benefits — billions more each year.

Not anymore. This year, for the first time since the 1980s, when Congress last overhauled Social Security, the retirement program is projected to pay out more in benefits than it collects in taxes — nearly $29 billion more.

Sounds like a good time to start tapping the nest egg. Too bad the federal government already spent that money over the years on other programs, preferring to borrow from Social Security rather than foreign creditors. In return, the Treasury Department issued a stack of IOUs — in the form of Treasury bonds — which are kept in a nondescript office building just down the street from Parkersburg’s municipal offices.

Now the government will have to borrow even more money, much of it abroad, to start paying back the IOUs, and the timing couldn’t be worse. The government is projected to post a record $1.5 trillion budget deficit this year, followed by trillion dollar deficits for years to come.

I give the writer, Stephen Ohlemacher, credit for remembering that even the net interest paid on the bonds is, if it needs to be paid out in cash, something the Treasury Department doesn’t have so much as a penny to pay out. A few points of order:

  • Those 12-month primary (or cash, if you prefer) deficits actually began in the February 2009-January 2010 period, when Social Security ran a $114 million primary deficit. An estimation using numbers from the Febraury 2010 Monthly Treasury Statement, which shows a $7.59 billion “gross” deficit (including the interest paid out on securities cashed in February) and a $7.71 billion primary deficit, bumps that 12-month primary deficit to $6.47 billion (between March 2009 and February 2010).
  • That nearly-$29 billion cash deficit for FY2010, or $34 billion if one prefers to go with the Office of Budget and Management numbers, tells only half the story. The FY2010 budget counted on $21 billion in primary surpluses from the Social Security “Trust Funds” to spend on other items in the budget, which makes the total amount of unplanned borrowing on the open Treasury market $50 billion-$55 billion.
  • Also from the OMB, for at least FY2010, the Old-Age and Survivors Insurance Fund is expected to run a primary deficit. It would join the Disability Fund, which began running primary deficits in 2005 and running gross deficits (i.e. shrinking its “Trust Fund” and entering the final stage of collapse) in 2009.

A quick note about the February 2010 numbers – while they are not the final numbers from Social Security’s Office of the Chief Actuary, they are rather reliable. They also represent, outside of the anomalous month of August 1990, when almost all of September 1990’s benefits were shown as paid out in August, the second-largest primary deficit (behind December 2009’s $11.307 billion primary deficit) and the largest gross deficit since monthly records have been kept in January 1987.

Even if we had taken Al Gore’s suggestion and put it the “Trust Funds” into a “lockbox”, it would, at best, only delay the inevitable. Between March 2001 and February 2010, the funds accumulated $869 billion in interest, and the primary growth was $607 billion, which together masked $1,475 billion in deficit spending over the last 9 years. Given the current problem is converting the “Trust Funds” to cash, and the problems both parties have had in saying no to spending, I don’t see how that “lockbox” would have helped any.

Revisions/extensions (3:19 pm 3/15/2010) – I really need to pay more attention to my feed reader over the weekend – Owen had it up yesterday.

R&E part 2 (7:00 pm 3/15/2010) – First, thanks to Ed for linking to me. Sorry about the problems that you may have experienced in loading this site; StatCounter had some issues.

Since Glenn Reynolds wanted to know what happened to the “lockbox”, I decided to take a somewhat-quick back-of-the-spreadsheet look at what would have happened had a “lockbox” been in existence the last 9 years. Do note that it would not have affected the primary deficits in the least, but it would have put at least some actual money into the “Trust Funds” for the future.

Monday Good Read – John Hawkins interviews Karl Rove

by @ 6:46. Filed under Politics - National.

The reason why I say “good” instead of “hot” is the Wreckonciliation version of PlaceboCare (which I believe is now up to 5.0) is out, and it left me white-hot with anger. John Hawkins got some interview time with Karl Rove, who has a new book, Courage and Consequence: My Life as a Conservative in the Fight, on Friday. Here’s one of the shorter question-answer exchanges:

One of the things that has puzzled conservatives about the Bush presidency, particularly in the second term — and I’ve heard this again and again and again — is they don’t feel like there was an effective communication strategy. The general feeling was that the Left turned George Bush into a punching bag and just beat him into the ground, while the White House really didn’t do much to stop it. Can you talk about that a little bit?

Well, I do think that there are instances, particularly on the issue of Iraq’s WMDs, where the administration didn’t punch back hard enough. I talk about that at length in the book.

It’s principally my responsibility because I should have seen it for what it was, which was a corrosive dagger aimed at the heart of the Bush Administration. But I would say this: in the last two years of the term, Bush was on the receiving end of daily blows from every Democratic presidential candidate and it was impossible for me to respond to those. The Republicans were disorganized, distressed, and didn’t come to his aid while others said the President can defend himself.

But when you’re receiving daily blows like that, you can either do your job or defend yourself, but you can’t do both every single day. It’s just the way life works.

March 13, 2010

Quick conversation – Ed Thompson

Most of my material from the Wisconsin Defending the American Dream Summit will have to wait until I get home tomorrow (or possibly Monday), but I had the chance to briefly speak with Tomah mayor Ed Thomspon, who is running for the 31st Senate seat currently held by Democrat Kathleen Vinehout.

Thompson stressed that he is a conservative. In fact, he signed the Americans for Tax Reform no-tax-increase pledge just yesterday. He also touts his business credentials as a supper club owner.

He knows he has a hard road against him. The 31st has produced one Republican in the last 100 years, Ron Brown, and it was Vinehout that beat him after only one term. While that election was in the Democratic wipeout of 2006. In fact, he outspent Vinehout by roughly a 2-1 margin.

Of interest to everybody, especially to those not in the 31st, Thompson answered that he thinks his brother Tommy will run for Senate against Russ Feingold. He further said that Tommy does need to give an answer, one way or the other, soon.

March 9, 2010

Fishing soon to be banned?

by @ 9:04. Filed under Envirowhackos, Politics - National.

(H/T – Marcus Wilder)

ESPN reports on what is likely coming down the pike for anglers on virtually every body of water in the United States:

The Obama administration will accept no more public input for a federal strategy that could prohibit U.S. citizens from fishing the nation’s oceans, coastal areas, Great Lakes, and even inland waters.

This announcement comes at the time when the situation supposedly still is “fluid” and the Interagency Ocean Policy Task Force still hasn’t issued its final report on zoning uses of these waters.

That’s a disappointment, but not really a surprise for fishing industry insiders who have negotiated for months with officials at the Council on Environmental Quality and bureaucrats on the task force. These angling advocates have come to suspect that public input into the process was a charade from the beginning….

Consequently, unless anglers speak up and convince their Congressional representatives to stop this bureaucratic freight train, it appears that the task force will issue a final report for “marine spatial planning” by late March, with President Barack Obama then issuing an Executive Order to implement its recommendations — whatever they may be.

Led by NOAA’s Jane Lubchenco, the task force has shown no overt dislike of recreational angling, but its indifference to the economic, social and biological value of the sport has been deafening.

Additionally, Lubchenco and others in the administration have close ties to environmental groups who would like nothing better than to ban recreational angling. And evidence suggests that these organizations have been the engine behind the task force since before Obama issued a memo creating it last June.

As ESPN previously reported, WWF, Greenpeace, Defenders of Wildlife, Pew Environment Group and others produced a document entitled “Transition Green” shortly after Obama was elected in 2008. What has happened since suggests that the task force has been in lockstep with that position paper.

Then in late summer, just after he created the task force, these groups produced “Recommendations for the Adoption and Implementation of an Oceans, Coasts, and Great Lakes National Policy.” This document makes repeated references to “overfishing,” but doesn’t once reference recreational angling, its importance, and its benefits, both to participants and the resource.

As a reminder, fishermen and hunters have done more to protect the environment than the EPA, the environment-enforcement part of the DNR, Greenpeace, the WWF, et al. We have a unique stake in a clean environment. In fact, when I go canoeing, I drink right out of the lake.

Revisions/extensions (6:20 pm 3/9/2010) – Allahpundit tracked down an old campaign promise Obama made to Sport Fishing (emphasis in AP’s post):

My administration would place the emphasis in fishery management where it belongs: in ensuring the long-term health and sustainability of stocks through the use of effective and appropriate conservation measures. Such an approach would not provide a preference for one management tool, such as a marine reserve, over another. Given sufficient management controls and data, a fishery can meet conservation objectives through a variety of catch controls and habitat-protection measures, including gear restrictions, bag limits or closures. In some cases, additional conservation measures may need to be taken to ensure a positive recreational marine-fishing experience for future generations of Americans. Recreational fishermen have not shirked from embracing such measures when needed to achieve long-term stock sustainability, as long as measures are matched to the problem. While marine reserves may be an effective means of achieving important goals, their use and design must be based on an assessment of impacts and balanced by a strong respect for the ability of recreational anglers to practice their sport. In my view, we need to be open to the use of a variety of innovative conservation tools and be prepared to use them if the science justifies their establishment, and if it has been determined that less-restrictive options will not achieve critical goals like rebuilding fish stocks. The decision to establish marine reserves should be made as a result of a transparent, science-based process and be the least intrusive possible to get the job done. Such a process should include outreach to the sport-fishing community to explain both the scientific basis for the action and the expected conservation benefits to future fishing generations if it is to gain the community’s active support.

As AP notes, it is an “official Barack Obama campaign promise”, which means that under the Jim Geraghty Principle, sooner or later, it will reach its expiration date.

It likely won’t happen all at once, but it will happen in bits and pieces, with the ultimate goal of no legal fishing happening if Obama stays in office the full two terms.

March 8, 2010

Social Security now running 12-month cash deficits – UPDATE – Worse than expected

by @ 10:16. Filed under Social Security crater.

Revisions/extensions part 2 (10:16 am 3/8/2010) – I originally posted this on February 22 using estimates from the January 2010 Monthly Treasury Report to fill in the numbers for January 2010. The Social Security Office of the Chief Actuary has now released the final numbers for that month, and the news is worse. The original post is below the fold (unless you’re reading just this post, in which case it’s below the update). I decided to append to this and bump it up to today’s date.

Between February 2009 and January 2010, the combined OASDI Social Security “Trust Funds” spent $112 million more than it took in in taxes. As noted in the original post (below), the 12-month primary (or cash) deficit is the first since monthly records were kept in 1987, and likely the first since the “forever” fix of 1983.

The estimate using the Treasury’s numbers was a $91 million primary deficit, which instead of proving too pessimistic based on recent analysis of the difference between the Treasury Monthly Statements and the OACT final numbers, proved to be too optimistic.

To contrast, just last year, the Obama administration expected the FY2010 primary surplus in the combined “Trust Funds” to be $21,028 million (or $21.028 billion – I will use a single base to make sure the numbers hit home) as part of its FY2010 budget. Now, it’s estimated to be a $33,754 million deficit, a shift of $54,782 million to the red. That’s $54,782 million that, thanks to the well-over $1,000,000 million (or $1 trillion) deficit that was already planned for this year, needs to be borrowed by the Treasury on the open market.

The situation is not yet as dire as it was between 1975 and 1981, when the combined funds ran overall yearly deficits, or 1982, when the Old-Age and Survivors Insurance fund borrowed from the Hospital Insurance (Medicare Part A) fund to stay fully-capitalized. However, raising the withholding tax 14% and the self-employment tax 64% isn’t exactly going to play well, and like the previous time, it will only slow the inevitable.

(more…)

Legislative Democrats trying to freeze Insurance Commissioner for the next 3 years

by @ 6:00. Filed under Politics - Wisconsin.

Rep. Bill Kramer (R-Waukesha) tipped me to this little power freeze, known as AB 787 introduced into the Assembly to keep control of the Office of the Commissioner of Insurance for another three years after losing the governor’s office. To wit, it changes the appointment from an “at the pleasure of the governor” appointment to a fixed 4-year appointment ending in the third year of the governor’s term.

Why is this so noxious? The OCI pretty much has free hand in regulating the entire insurance industry. Given every driver in the state has to have auto insurance, and if PlaceboCare gets put into law, every person would have to have health insurance, the philosophy of the operation of that power is something that should not be divorced by three years from the expression of will by the public.

Oh, and before you Democrats scream that it was a partisan Tommy Thompson that got the term changed from a fixed term to one of the governor’s discretion, it was done by a Democratic Legislature.

March 6, 2010

Sean Duffy endorsed by the 7th District Republican caucus

by @ 19:36. Filed under Politics - Wisconsin.

This came in today from the Sean Duffy campaign:

Wisconsin’s 7th Congressional District Republican Party today voted in overwhelming numbers to officially endorse Ashland County District Attorney Sean Duffy as their choice to defeat Chairman David Obey in November.

Of those who voted to endorse, Sean Duffy received 406 delegate votes, or 84 percent of the vote to Dan Mielke’s 78 delegate votes, or 16 percent of the vote.

“I’m humbled and extremely grateful to Republicans in the 7th District for their official endorsement. I’ve never seen the Party more unified or more energized. Our positive message of job creation and fiscal responsibility has clearly resonated,” said District Attorney Duffy. “Dave Obey’s big government spending spree has mortgaged our children’s future, slowed our economic recovery and driven American into record debt. The contrast between us is clear and simple – Obey puts his faith in government bureaucrats, and I put my faith in the American people.”

The Duffy for Congress Campaign has raised a record $400,000 – twice as much as any previous Obey challenger raised in an entire election cycle – while being highlighted by the Wall Street Journal and National Review Online, and named by the Washington Independent as the #3 conservative in America to watch in 2010.

Sean Duffy was first elected as Ashland County District Attorney in 2002 and has served in that role for seven years. As District Attorney, Duffy has aggressively compiled a 90 percent conviction rate. He is three-time World Champion Lumberjack athlete, ESPN Outdoor Games analyst, and former MTV Real World cast member.

Good luck Sean.

Weekend Hot Read – Tom Blumer’s “Should the ‘Smarties’ Really Be Put in Charge of Health Care?”

Tom Blumer’s latest column at Pajamas Media uses the history of Social Security, Medicare, and Fannie Mae/Freddie Mac to knock down the continuing myth that liberals are smarter than everybody else, as well as explode the idea that the federal government be awarded the remainder of the health care system. Since my acquired “specialty” is Social Security, I’ll give you the meat of that portion of the beatdown:

Yet the reported $7.677 trillion liability shows that it’s still nowhere near enough to meet future promises, primarily because:

  • FDR and his smarties didn’t build the improved life expectancy of future generations into the program. If they had, today’s normal retirement age would be somewhere between 70 and 75, instead of its current 66-67, depending on one’s year of birth.
  • The method of indexing chosen in the mid-1970s has caused benefits to go up faster than the real living standards of everyone else, and has subtly changed the program’s perceived purpose from preventing destitution to providing the means to ensure a lower middle-class lifestyle.
  • The smarties also didn’t anticipate lower birth rates that were already occurring, and which were then dampened even further almost 40 years later by legalized abortion. As a result, at the end of 2008 there were less than 2.6 employed workers for each Social Security beneficiary (143.3 million divided by 55.8 million).
  • Additionally, as shown in several previous columns (one is here), the so-called Social Security “trust fund” has been wantonly raided for the past 40 years and used to pay for the government’s everyday operations. The “trust fund” contains virtually nothing except $2-plus trillion in IOUs from the rest of the government, which is itself trillions of dollars in debt.

Because of all of this, even the astronomical taxes noted earlier have been less than benefits paid for most of the past year — and it’s going to get worse. The crisis that supposedly didn’t exist in 2005 is here. Thanks, smarties.

The bad news is that is the good news, and that was based mostly on the Trustees’ look at the long-term health of Social Security from last year. Medicare’s unfunded liabilities are much worse – $38.1 trillion (again, as of last year), while Fannie Mae/Freddie Mac, which aren’t even accounted for in the Treasury Department’s 2009 Financial Report, lost $100 billion last year and may end up costing the government between $1 trillion and $5 trillion in losses.

A bonus item from Tom’s tease back at BizzyBlog – that employed/beneficiary ratio dropped from 2.56 (rounded up to 2.6 in the column) at the end of 2008 to 2.39 at the end of January 2010, and is likely to worsen through the end of the year.

March 5, 2010

CBO estimate of the FY2011-FY2020 deficits – $9.761 trillion

by @ 22:59. Filed under Politics - National.

I guess we could call this part 2 to the prior post on the long-term situation of the government. The Congressional Budget Office scored Obama’s FY2011 budget, and the picture is not pretty. The summary of deficits:

  • FY2010 – $1,500 billion (which The Hill notes is $56 billion less than the White House Office of Management and Budget estimate due to the CBO estimating less spending – H/T Zip)
  • FY2011 – $1,341 billion (versus OMB’s $1,267 billion)
  • FY2012 – $915 billion (versus OMB’s $828 billion)
  • FY2013 – $747 billion (versus OMB’s $727 billion)
  • FY2014 – $724 billion (versus OMB’s $706 billion)
  • FY2015 – $793 billion (versus OMB’s $752 billion)
  • FY2016 – $894 billion (versus OMB’s $778 billion)
  • FY2017 – $940 billion (versus OMB’s $778 billion)
  • FY2018 – $1,001 billion (versus OMB’s $785 billion)
  • FY2019 – $1,152 billion (versus OMB’s $908 billion)
  • FY2020 – $1,253 billion (versus OMB’s $1,003 billion)

The total sum of the deficits as estimated by the CBO is $9,761 billion (or $9.761 trillion), versus the OMB’s $8,532 billion estimate. That is attributable to a higher estimate of tax revenue by the OMB; both the OMB and CBO estimate that there will be about $45 trillion in government spending over the next 10 years.

Further, I note that, while the bulk of the Bush tax cuts would be allowed to expire (something the Government Accountability Office does not assume in its “alternate” scenario touched on in the prior post), and discretionary spending is lower than in the baseline (due entirely to lowered spending in defense), the increased costs of PlaceboCare make the overall picture in FY2020 look quite a bit like the free-spending “alternate”, which assumes discretionary spending remains at the bloated 8.7% GDP. Indeed, the cost of “mandatory” spending and net interest would be roughly 94.7% of the entire tax take of the federal government, higher than said GAO “alternate” (approximately 93%) or the pre-budget “baseline” (81.7%).

GAO – Unfunded liabilities over the next 75 years – $41.1-$76.4 trillion

by @ 15:03. Filed under Politics - National.

Rep. Paul Ryan (R-WI) and the Republicans on the House Budget Committee point to a pair of publications from the Treasury Department and the Government Accountability Office that both show that the amount of unfunded liabilities going completely off the charts. I’ll focus on the GAO report, mostly because it is less than a tenth the size of the Treasury Department one, but also because the GAO can’t render an opinion on the bulk of the Treasury Department one because of “widespread material internal control weaknesses”.

Before I really delve into the GAO’s January 2010 update on “The Federal Government’s Long-Term Fiscal Outlook”, I have to briefly explain the two major scenarios they use; the “Baseline Extended” and the “Alternate”. Both are based on the Congressional Budget Office’s January 2010 10-year baseline. The major difference on the revenue side is the Baseline Adjusted assumes that the expiring tax cuts (both Bush’s and Obama’s) expire on schedule and the Alternate Minimum Tax does not get indexed for inflation (the indexing currently must be done by Congress yearly), then continue to be at 20.2% of GDP (the 2020 level) after 2020, while the Alternate assumes that the tax cuts continue through 2020 and the AMT continues to be indexed through 2020, then adjust to the 40-year historical average of 18.1% of GDP. On the spending side, unlike the Baseline Extended, the Medicare “Doc Fix” (again, done by Congress yearly) continues to be done, the refundable portion of tax credits due to expire don’t through 2020, and discretionary spending goes up at the rate of economic growth (or a constant 8.7% of GDP, versus the Baseline Extended assumption of going up by the rate of inflation through 2020 then remaining at 6.7% of GDP).

Under the Baseline Extended scenario, which the GAO notes has revenues higher than historical average and discretionary spending below historical average, the unfunded liability over the next 75 years is $41.1 trillion. That compares very unfavorably to the fall 2009 estimate of $36.1 trillion in unfunded liability. Of note, the GAO says that either taxes would immediately need to go up 24.2% and remain that much higher than their projections throughout the next 75 years, which would leave taxes at 25.3% of GDP by 2020, or discretionary spending be immediately reduced by 20.0% and remain down at that level throughout the next 75 years, to close that gap.

However, we know that government will not allow spending to grow by only the rate of inflation; hence the Alternate scenario is operative. The GAO notes that both revenues and discretionary spending under that scenario are roughly the same as their historical averages. Under that scenario, the unfunded liability over the next 75 years is $76.4 trillion. That’s right – a $1 trillion deficit every year for the next 75 years. That is also a $14.3 trillion increase in unfunded liabilities since last fall, when it was $62.1 trillion.

Some items of note from Ryan and the House Republicans on the Budget Committee:

  • By 2020, roughly 93 cents of every dollar of Federal revenue will be spent on major
    entitlement programs and net interest costs.
  • By 2030, net interest payments on the Federal Government’s accumulating debt will
    exceed 8 percent of gross domestic product [GDP] – making them the largest single
    expenditure in the Federal budget.
  • To close the fiscal gap today, the government would have to immediately raise taxes by
    50.5 percent (note, that would raise the tax take beyond 2020 to 27.2% of GDP), or cut non-interest spending by 34.2 percent.
  • If no action is taken in the next 10 years, in 2020 the government would have to raise
    taxes by 60.7 percent (or to 29.1% of GDP), or cut noninterest spending by 40.2 percent

Figures 3 and 4 in the GAO report, which outline revenues and composition of spending under the Baseline Extended and Alternate scenarios respectively, are must-sees. Even under the Baseline Extended model, spending on interest, Social Security, Medicare and Medicaid will exceed total revenues by 2040. It’s worse under the Alternate scenario – the major entitlements and interest will exceed total revenues long before 2030, and Social Security alone plus interest will exceed total revenues in 2040.

For those of you who think that the problem is low revenues, I decided to mash the Baseline Extended revenue projection into the Alternate spending chart, which is the most-likely scenario given that the majority of “Republican” Senators refused to find $10 billion in a $3,600 billion budget to cut to pay for a month’s worth of additional unemployment benefits.

Friday Hot Read – Charles Krauthammer’s “Why the Health Care Bill is a Failure”

I don’t believe I can do a better job than Charles Krauthammer explaining the failure of PlaceboCare. I’ll “borrow” the part where Krauthammer explains why the sum is worse than the parts:

Allow me to demystify. Imagine a bill granting every American a free federally delivered ice cream every Sunday morning. Provision 2: steak on Monday, also home delivered. Provision 3: A dozen red roses every Tuesday. You get the idea. Would each individual provision be popular in the polls? Of course.

However (life is a vale of howevers) suppose these provisions were bundled into a bill that also spelled out how the goodies are to be paid for and managed — say, half a trillion dollars in new taxes, half a trillion in Medicare cuts (cuts not to keep Medicare solvent but to pay for the ice cream, steak and flowers), 118 new boards and commissions to administer the bounty-giving, and government regulation dictating, for example, how your steak was to be cooked. How do you think this would poll?

Perhaps something like 3-1 against, which is what the latest CNN poll shows is the citizenry’s feeling about the current Democratic health care bills.

However, I do disagree that the body blow was how to pay for it. The Senate had before it, at a point when they needed absolutely no Republican support and no need for what Michelle Malkin has aptly called “Wreconciliation”, a bill that did everything the Left has ever wanted out of PlaceboCare but one “minor” detail – full federal funding for and a mandate on private insurance to provide abortion-on-demand. In order to get that into PlaceboCare, they sacrificed the official public “option” (with no real change in the cost), shifted a big part of the payment of the costs from “the rich” to businesses deemed to be too generous with their health-care plans, and threw in so much bribery that the House initially blanched at taking it up.

Hope, change, return to military commissions

(H/T – Ed Morrissey)

The Washingotn Post is reporting that key advisers in the Obama administration are set to recommend that Attorney General Eric Holder be overridden and the trials of Khalid Sheik Mohammed and several others be conducted in the military tribunal system instead of civilian courts.

It remains to be seen whether the expiration of this particular promise to the Islamokazi-appeasing Left is due more to the incredible amount of bipartisan (original meaning) backlash it has caused or a cynical deal to unexpire the promise to close Club Gitmo.

American Jihadists

If you hear the word “jihad,” what comes to mind?  Outside of an immediate thought of “Islam,” how about one of this: 

A crusade or struggle characterized by the participants willingness to sacrifice their own lives for the benefit of said crusade or struggle.

It’s now apparent that the Democrat leadership of President Obama, Nancy Pelosi and Harry, dancing on another 36,000 job deaths, Reid, have decided to do anything and everything they can to pass Placebocare.  Which version or what is actually contained in Placebocare doesn’t even matter to them anymore.  They will enact any version or combination of the government takeover of health care that they can find enough votes or contrivance of procedures to get it passed. 

The vehicle that is getting the most focus for enacting Placebocare is via reconciliation.  For the life of me I can’t figure out how they use reconciliation as there isn’t a bill that both Houses are working on.  In my mind, the only way to get Placebocare passed, as things stand today, is to convince the House to pass the Senate bill just as it stands.

Whether the Democrats attempt reconciliation, pass the Senate bill or use some other mechanism, the implications on their November prospects are the same; Horrible!  Note the following quotes and polls:

“What the President is really asking House Democrats to do is hold hands, jump off a cliff and hope Harry Reid catches them,” Sen. Lamar Alexander (R-Tenn.), chairman of the Senate Republican Conference said.  “And, Harry Reid will have no incentive to catch them because by the time he gets to the reconciliation bill, the President will have already signed the health care bill into law.”

“It was another emphatic denunciation by [Democratic Rep. Stephanie] Herseth Sandlin of the reconciliation process, a controversial technique allowing Democratic leadership in the Senate to bypass an otherwise required 60-vote super majority. And it also was a clear rejection of the Senate version of health-care reform, approved when Democrats still had the 60 votes needed for a super majority.” (Kevin Woster, “Herseth Sandlin says no to Senate health bill, reconciliation,” Rapid City Journal, 03/04/10)

House Democrats have said they don’t trust the Senate to actto make changes to the Senate bill, which the House would likely have to pass before they’re able to take up a new bill to make changes to that original legislation.” (Michael O’Brien, “Stabenow: House and Dems hammering out final health bill details,” The Hill, 03/04/10)

 “… 48 percent saying lawmakers should work on an entirely new bill and a quarter saying Congress should stop all work on health care reform.” (Paul Steinhauser, “CNN Poll: Health care provisions popular but overall bills unpopular,” CNN, 02/24/10)

Even Howard Dean, no shrinking violet when it comes to larger government and bureaucratic controls, recognizes that budget gimmickry of Placebocare will cause the Democrats pain not only in 2010 but also in the 2012 election:

“The plan, as it comes from the Senate, hangs out every Democrat who’s running for office to dry — including the president, in 2012, because it makes him defend a plan that isn’t in effect essentially yet,” Dean said during an appearance on the liberal Bill Press Radio Show.

With the heated, negative perception of Placebocare, even amongst the Democrats themselves, a reasonable question would be, “Why, if the results are surely political death, would Obama, Pelosi and Reid push for the passage of Placebocare?”  The answer is very straight forward; the Democrat leadership is perfectly willing to commit political suicide for themselves and all those around them, if they are able to move their crusade forward.  Obama, Pelosi and Reid are American jihadists.

If you believe that my use of the term “jihadist” is nothing but hyperbole, you haven’t been paying attention.  Look at the words of Nancy Pelosi.  Numerous publications including the WSJ, have reported Pelosi telling members of her caucus that she is willing to lose seats if they can pass Placebocare.  More to the point, were the Democrats to lose the number of seats that they are now estimated to lose, Pelosi herself would certainly lose the Speaker position.

One of the confounding challenges of combating Islamic jihadists is that they don’t fear their own death.  In fact, Islamic jihadists are told that they will garner a great reward in the afterlife if they sacrifice their physical bodies.  In like manner, the Democrats are willing to sacrifice their political lives to ensure the securing a key victory in their crusade.  President Obama and Nancy Pelosi have been working hard to ensure the House jihadists that they too will receive great rewards should they lose their political life.

In the end, whether Placebocare succeeds or fails in the House will depend on one thing; will the House members choose the life they know or will they choose the rewards promised them in their political afterlife?

March 4, 2010

Thursday Hot Read – Andrew C. McCarthy’s “AWOL in the Bunning Battle”

by @ 16:29. Filed under Health Care Reform, Politics - National.

(H/T – Michelle Malkin)

Andrew McCarthy unloaded on the Senate “Republicans” who dumped all over Sen. Jim Bunning (R-KY) for daring to ask that, in a budget of $3,600 billion, that $10 billion in excessive spending (or 0.28%) be found to pay for a month’s extension of unemployment benefits that were already extended from 6 months to 15-17 months depending on the state:

In sum, Bunning’s battle gave Republicans a chance to make points about runaway deficit spending, the fraudulence of PAYGO posturing, the foolish redistribution of wealth to create expensive and unproductive government jobs, unemployment-benefit extensions that Democrats refuse to pay for and that actually increase unemployment, and the monstrous rationing that would be wrought by Obamacare. So, did Republicans rally behind Bunning? Not a chance.

Why? Why abandon this fight when the GOP has the facts on its side? Why no enthusiasm when a year of Obama’s forced march to crony socialism has the public more receptive than ever to the case for slashing government? Simple: Republicans are afraid of being demagogued — as Democrats and the media demagogued Bunning — as wanting to cut off funding (i.e., money we don’t have) for unemployment insurance and the usual laundry list of other Big Government baubles like COBRA coverage, satellite TV dishes, the “highway trust fund,” etc. Republicans also did not want their own sorry PAYGO history rehashed.

Here’s the sad truth: For all the shining they did at last week’s White House “summit” on health care, when it gets down to actually putting the brakes on the Big Gummint Express, most of today’s Republicans are AWOL. They’re great at the debate society. But making the fight on something concrete, really saying no when it means grinding redistribution to a halt, means taking the slings and arrows. No thanks, they say, let’s just make the whole thing go away on a voice vote, the sooner the better. Indeed, while Senator Bunning should be lauded for engaging this fight, it is telling that he took it on only after deciding not to seek reelection.

In a Corner post this past weekend called “Transformation,” I dissented from the heady palaver on the Right about how Democrats are headed for a November Waterloo. I think the Left has already factored in the inevitability of setbacks — perhaps heavy setbacks — in the next few election cycles. While our side swoons over the prospect, the statists coldly calculate that these losses are a price well worth paying in order to impose a transformative takeover of the economy.

It is a perfectly rational calculation for two reasons.

First, with a significantly bigger and more powerful government bureaucracy, there will be many avenues for leadership to reward Democrats who lose their seats after casting the unpopular votes necessary to enact the Left’s program. White House chief of staff Rahm Emanuel, who spent his post-Clinton wilderness months in a lucrative sinecure at Freddie Mac, knows well how this game works — and, under Obama’s command, the economy is becoming one big Freddie.

Second, and more important, Democrats know the electoral setbacks will only be temporary. They are banking on the assurance that Republicans merely want to win elections and have no intention of rolling back Obamacare, much less of dismantling Leviathan.

For my money (while I still have some), that’s an eminently sound bet. The Bunning battle, in which the GOP was nowhere to be found, is the proof. Bunning just wanted Congress to live within its gargantuan means. Yet, the Washington Post ridiculed him: “angry and alone, a one-man blockade against unemployment benefits, Medicare payments to doctors, satellite TV to rural Americans and paychecks to highway workers.” That’s outrageously unfair, but it is a day at the beach compared to the Armageddon that would be unleashed upon any attempt to undo Obama’s welfare state on steroids.

As it turns out, Republicans didn’t have the stomach for a fight over wealth transfers that plainly exacerbate the problem of unemployment. Why would anyone think they’d take on a far more demanding war, in which Democrats and the legacy media would relentlessly indict them for “denying health insurance to millions of Americans”?

Even if the GOP gets a majority for a couple of cycles, even if President Obama is defeated in his 2012 reelection bid, Obamacare will be forever. And once the public sees that the GOP won’t try to dismantle Obamacare, it will lose any enthusiasm for Republicans. Democrats will eventually return to power, and it will be power over a much bigger, much more intrusive government.

The historical strategy of the Left has been to create a new Leviathan growth of Socialist government every 30 years, stave off defeat of said Leviathan until it becomes so ingrained into the culture that even those that would have worked to kill it both before it its creation and during its infancy accept its place in the culture (which usually takes 15-20 years), then repeat the cycle.

March 3, 2010

Number of the day – $100,005

by @ 17:29. Filed under Education, Politics - Milwaukee.

The MacIver News Service reports on the average compensation at Milwaukee Public Schools:

2009-2010 school year (aka FY2010) – $56,500 in salary, $95,316 including benefits
2010-2011 school year – $56,500 in salary, $100,005 including benefits (or a 4.92% increase overall)

Meanwhile, according to the Census Bureau, the median per-capita income between 2006 and 2008 in the city was $19,092, with the median family income $42,950. I doubt the average resident in the private sector had $40,000 in benefits to boost their total compensation, or the equivalent of 12 weeks of vacation.

Californication of the House continues – Stark in for Rangel – UPDATE – Levin in for Stark

by @ 13:30. Filed under Politics - National.

Fox News is reporting that while Rep. Charlie Rangel (D-NY) takes a “leave of absence” from his House Ways and Means Committee chairmanship to rehab his image (actually, wait for the ethics clock to run out), Pete Stark (D-CA), who was “cleared” by the same “Ethics” Committee for essentially the same charges, will take over for him.

Fox notes that places Californians at the head of all three of the committees that will deal with PlaceboCare 4.1 (the aforementioned Stark “temporarily” heading Ways and Means, Henry Waxman running Energy and Commerce, and George Miller running Education and Labor), as well as a fourth major committee (Howard Berman running Foreign Affairs), and said “Ethics” Committee (Zoe Lofgren).

Guess it’s time to to dip into the video vault…

[youtube]http://www.youtube.com/watch?v=sFMLARtqxCY[/youtube]

Revisions/extensions (7:37 pm 3/3/2010) – Roger L. Simon lists just some of the lowlights of Stark’s raving madness. As Simon says, “Do these Democrats have a death wish? Have they gone completely bonkers? Or did Nancy Pelosi’s plastic surgeon misfire and accidentally inject the Botox into her brain?”

R&E part 2 (2:35 pm 3/5/2010) – It’s now Rangel ally Sander Levin “in charge”. As Ed notes, it’s actually SanFranNan and Chris Van Hollen that run Ways and Means.

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