Showing posts with label budget. Show all posts
Showing posts with label budget. Show all posts

Tuesday, April 23, 2013

Obama: Risking Lives In The Name Of Politics

There is absolutely no reason for the “Sequestration” to have cut any government services outside of the Military.

We keep getting emails from people that do not understand why “Sequestration” was not a real cut in spending. One of the more resent emails shed some light on why people don’t grasp the situation. The author offered this, “We ordinary folks just don’t think in terms like trillions, billions and millions.”

So let’s try explaining in terms that 'ordinary folks' will understand.

Assume that you earn $500 per week and your boss has expressed his intent to increase your pay by $50 per week on May 1. May 1 arrives and your boss tells you that sales have been less than expected and you will only get an increase of $45 per week. You now have a salary of $545 per week. Not what you expected but still a nice 9% raise. You my friend have been “Sequestered”.  I don’t know about you, but I would have welcomed that type of 'pay cut' every year.

The reason that services are being cut is because and only because your President is having a temper-tantrum in response to his being denied a second $800 Billion tax increase on the top 1%; less than two months after getting an $800 Billion tax increase on the same group!

Obama has ordered every agency to make “Sequestration” as “painful as possible” for everyone!

He wants you to push Congress to increase taxes and also to make you believe that it is the Republicans fault on every single issue, so that he can finish screwing the nation when you give him a Democrat controlled House in 2014! 

The most insidious of these White House mandated cut backs (Sequestration was Obama’s brain child) in services is the furloughing of air-traffic controllers.

Note: An addition tidbit--It is a fact that the FAA has a larger budget than Obama had proposed for 2013.

The major problem with furloughing the flight-controllers is that an already burdened system has become dangerously more overloaded. This exposes passengers and air crews at a far greater risk than is necessary. In addition to the inconvenience of delays and cancelled flights that Mr. Obama has hoisted on the air travelers, the already fragile airlines are losing Millions of dollars per day—some airlines may not survive!

The Department of Defense (DOD) is seriously impacted by Sequestration. The DOD had a real budget cut of 11% ($50 Billion) from their 2012 budget ($455 Billion) before Sequestration. One half of the total Sequestration or $44 Billion were piled on the DOD budget. As a result DOD has real budget cuts totaling $94 Billion (21%) less than they had in 2012.

Furthermore, the White House will not permit the DOD to make the cuts in a prudent manor. 

This administration is completely void of honesty, leadership, common  sense, and could not care less about American citizens regardless of skin color.

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Tuesday, February 26, 2013

The Lying King

This nation began with a President of whom it was said that he could not tell a lie.

At this moment in times, it looks as though the nation will end with a president who cannot or will not tell the truth.

In his most recent series of gratuitous lies, Obama makes it sound as if the ‘Sequestration’ will trigger the ‘Apocalypse‘.

Let’s get a few facts established:

1. The Sequestration clause was inserted into a finance bill because Obama demanded it.

2. The Sequestration will be a mere 2.4% of the entire budget (if we actually had a budget).

3. The Pentagon is bearing 50% of the total cuts.

Note: Every agency’s budget has a built-in baseline increase before Congress acts on a budget. As a result, every department other than the Department of Defense actually has more money, after Sequestration, than they had in 2012.

If the 2.4% reduction in growth will cause all the havoc that Obama claims, what in hell does the other 97% do? May be, the Congress should give back the all damaging 2.4% and reduce the 97% that according to the administration is doing nothing.

Obama and his butt kissing friends in the media are blaming the Republicans for the Sequester. In truth, it was at Osama’s insistence that the Sequestration clause was inserted into “The Budget Control Act of 2011”. The clause specified an incentive for Congress to act. If Congress failed to produce a deficit reduction bill with at least $1.2 trillion in cuts, then Congress could grant a $1.2 trillion increase in the debt ceiling but this would trigger across-the-board cuts (Sequestration”, as of January 2, 2013.

The House submitted several budgets that met these goals, but none were brought to the floor in the Senate and Obama made it clear that he would not sign a budget with any spending reductions.

If a 2.4% cut were mandated across the board, every government entity could absorb the cut with zero effect of the public. In fact, most agencies could handle a 10% reduction in their annual budget. Some, like the ‘Department of Energy’, could be cut 100% with no ill effect what-so-ever.

The Department of Defense is a different story. They already faced a massive budget reduction which when combined with the Sequestration ‘cut’ results in a1 trillion dollar cut over 10 years! That is a very large cut for them to absorb.

To make matters worse, the Commander-in-Grief will not grant any of the services the authority to manage where the cuts are made.


The Democrats have over the past few days expressed fear that the ‘cuts’ won’t cause the panic that they seek, and therefore, the public won’t turn on the Republicans in Congress. Even worse, they fear that the ‘workers’ might see ‘cuts’ as a good thing.

The Democrats keep telling us that we need a ‘comprehensive agreement’. The problem with that is that they already have lots of new taxes but there have been zero cuts. Let’s catch up on those cuts so that we have a ‘balanced /comprehensive agreement’.

Obama is out to destroy this nation and will continue to push his tax-of-the-month campaign.

If you want a shot at saving the country, keep letting Congress know that you want more spending cuts!


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Sunday, September 23, 2012

Even The Fed Doesn’t Believe It’ll Work

by Austin Hill
Breaking news: officials in our U.S. Federal Government do not know how to solve all our woes.

This actually shouldn’t be “news.” Leaders from none other than the Federal Reserve, itself, have repeatedly admitted this in recent months.

Fed Chairman Ben Bernanke has admitted this multiple times, and in a variety of different contexts (a point I’ll review momentarily). But last Wednesday, the President and C.E.O. of the Federal Reserve Bank of Dallas reiterated this point himself, and his announcements have largely been ignored.

In a Speech before the Harvard Club of New York City, bank President Richard Foster publicly restated his opposition to the Fed’s recent decision to launch “QE3,” its third attempt in three years to use monetary policy to stimulate the economy. Foster began his speech noting that “with each program we undertake to venture further in that direction (in the direction of using monetary policy as stimulus), we are sailing deeper into uncharted waters. We are blessed at the Fed with sophisticated econometric models and superb analysts. We can easily conjure up plausible theories as to what we will do when it comes to our next tack or eventually reversing course. The truth, however, is that nobody on the committee, nor on our staffs at the Board of Governors and the 12 Banks, really knows what is holding back the economy.”

Later in the speech, Mr. Foster noted that our economy “is already flush with $1.6 trillion in excess private bank reserves owned by the banking sector and held by the 12 Federal Reserve Banks. Trillions more are sitting on the sidelines in corporate coffers. On top of all that, a significant amount of underemployed cash—or fuel for investment—is burning a hole in the pockets of money market funds and other non-depository financial operators. This begs the question: Why would the Fed provision to shovel billions in additional liquidity into the economy’s boiler when so much is presently lying fallow?”

The economy is being held back despite trillions of dollars “lying fallow,” and the highly educated experts at the Federal Reserve can’t figure out why. Mr. Foster deserves our thanks for being so truthful – yet we should all be concerned about his observations.

Of course, it was only three months ago when Chairman Ben Bernanke admitted that he had “no idea” why our economy is so “fragile.” This is the man who has overseen the lending of more than $3 trillion American taxpayer dollars to foreign banks; the rapid-fire acquisition of the former giant Merrill Lynch by the gargantuan Bank of America; the multi-billion dollar taxpayer bailout of Wall Street; and – although he cannot craft legislation nor sign bills in to law, he nonetheless supported the $800 billion “economic stimulus bill” from the Congress and the Obama Administration.

And after all that – and before the latest stimulus effort announced less than two weeks ago – the Fed Chairman nonetheless admits that he has “no idea” what is wrong with our economy.

The talent, econometric models, and superb analysts at the Federal Reserve notwithstanding, Americans of all stripes need to come to grips with some basic economic realities. If it is still a goal of our country to create wealth and opportunity for all, then we’ll have to start demanding that our government officials think and act differently.

For example, we will not have entrepreneurs once again using those “fallow trillions” to create new businesses and jobs in large quantities, until we demand that government stops bullying private enterprise. Despite the claims at the recent Democratic National Convention that President Obama “saved G.M” with government bailouts, last week General Motors announced that it wants to sever ties with our government. According to G.M. leadership, the restrictions on executive salaries that President Obama has forced upon the company have put G.M. at a competitive disadvantage with other car companies.

The fact that the Obama Administration would use an entire car company to satisfy its political agenda of cutting executive salaries, even at the expense of the company’s wellbeing, does not create a business-friendly environment. It conveys to entrepreneurs that President Obama’s agenda is preeminently important, and prosperity is secondary.

And did you hear about the Gallup organization? After publishing both political polling data and unemployment data that reflected poorly on the President, Obama campaign strategist David Axelrod engaged Gallup in a series of intimidating conversations demanding that Gallup change their methodologies. Gallup didn’t budge – and mysteriously found themselves targeted with a lawsuit from the Department of Justice lawsuit over an “unrelated issue.”

Americans must also demand that both Washington, and Wall Street, embrace the economic wisdom of Main Street. Most of us realize that, just as a drunken person cannot drink himself sober, no individual, household, nor organization can borrow and spend itself out of debt. This reality applies to our government, as well.

Americans deserve, and must demand, better.


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Sunday, September 16, 2012

Downgrade Nation: Seeing Through The Charade Of Presidential Politics

by Austin Hill
The U.S. Federal Reserve initiated more economic stimulus. And the very next day the U.S. Government received another debt downgrade.

Did one lead to the other- or is there more to the story?

Amid last week’s headlines of Islamic terrorist attacks and domestic bomb threats, the news about another U.S. debt downgrade may have seemed anticlimactic. Yet this additional downgrade for the U.S. has been a long time in the making, has long-term ramifications, and was not triggered by the Federal Reserve alone.

After months of speculation, pressure, and mostly bad economic data, Federal Reserve Chairman Ben Bernanke announced last Thursday that he would launch a third round of economic stimulus code-named “QE3” (several media outlets, including CNBC and Yahoo! Finance, quickly nicknamed it “QE infinity” owing to its open-ended, no-end-in-sight nature). The plan, as Mr. Bernanke explained, is for the Federal Reserve to purchase $40 billion worth of mortgage-backed securities every month, and to do so for as long as he thinks it is necessary.

Of course, it was only five months ago that the Egan-Jones Ratings company downgraded the U.S. Government because of its profligate spending and total lack of interest in reducing its deficits, lowering it from a ”AA+” to a “AA” rating. After last week’s announcement about even more deficit spending by the Federal Reserve, our government continued its downward spiral on credit-worthiness by achieving Egan-Jones ‘ latest evaluation: a rating of “AA-.” Each of the other major credit ratings companies (Moody’s, Fitch, and Standard & Poor) gives the U.S. a slightly better rating, yet all of them forecast negative outlook” for our government’s credit worthiness.

In making its downgrade announcement, Egan-Jones stated that our government’s decision to issue more currency and to artificially depress interest rates by purchasing mortgage-backed securities will likely do very little to expand America’s actual gross domestic product, yet at the same time it will likely reduce the value of the dollar. The agency further noted that this decision will increase the cost of commodities, which in turn will hurt the profitability of businesses, and will increase the prices of consumer products thereby reducing consumer purchasing power.

The team at Egan Jones seems to be seeing things clearly, and, if nothing else, is displaying a sound grasp of some very basic economic ideas. Just as a drunken person cannot drink their way back to sobriety, no entity of any sort – no individual, no household, no organization nor any government – can borrow and spend its way out of debt. And the more indebted one becomes, the less trust-worthy one becomes with creditors – which ultimately leads to less prosperity.

What is perhaps most striking about Egan Jones’ response to the Fed is that it was the complete antithesis of the collective response from the stock market. Investors, traders and brokers were so exuberant over Chairman Bernanke’s choice to spend more of our non-existent tax dollars that the Dow was driven to a 5-year high on Thursday. Those who are entrusted to offer honest assessments of our government’s credit worthiness see the U.S. as inviting more trouble upon itself. Those, on the other hand, who are not so concerned with honest assessments, are apparently quite happy to trust in the gamesmanship and hocus-pocus of politicians and government bureaucrats- despite the preponderance of evidence that such government manipulation of the marketplace produces only short-term pleasure and a lot of long term pain.

And herein resides the greater problem for the United States and its debt: credit ratings agencies, foreign governments, and private individuals around the world are watching our country and observing our near-total lack of “political will” to get our fiscal house in order. Granted the Chairmanship of the Federal Reserve is, at least in theory, a non-political position in our government, and its occupant is not beholden to electoral politics. Presumably Chairman Bernanke has chosen to act in this way because he believes it is the right thing for him to do (although his choice to implement such a short-sided policy within two months of a presidential election has nonetheless raised doubts about his independence of the President).

But the fiscal recklessness of our government does not begin and end with Bernanke. It rests with the President and the Congress primarily – and especially with President Obama, given that he and his party controlled both the Executive and Legislative branches of our government for two years, yet he chose to harness that power for to create more government spending and debt and not less.

Our current presidential campaigns also give the impression abroad of an “out of touch America.” Vice presidential nominee Paul Ryan dares to address our dangerous condition, but only in the most minimal of terms – and for this he has been labeled “the Flim Flam Man” by the New York Times’ Paul Krugman, and is accused of allegedly hurting children, the elderly, and ethnic minorities with his proposed reductions in entitlements.

Add to this the reality that our President’s foreign policy is going up in flames before a global stage – yet he remains politically viable and popular – and it’s not difficult to understand why other countries are getting nervous. The real question in this, however, is when will Americans get nervous – nervous enough – that they demand fiscal sanity from their elected leaders?

It won’t happen between now and the next election day. But will it happen soon enough-before the politicians have done irreparable damage?


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Tuesday, December 13, 2011

Is This What Democrats Want For Our Future?

By Austin Hill

Terrorist threats are on the rise, government debt threatens the world, and the value of our currency is being questioned almost daily. Is this the “fundamental change” that Democrats wanted from President Barack Obama?

Like it or not, President Obama sets the agenda for the Democrats. And it’s time for every elected Democrat – especially those in Congress – to answer some questions. Is this your idea of the American future? Is this your vision for the United States? We should be asking these questions in light of two broad areas of domestic policy:

National security policies that ignore trends of murderous behavior:

Within the first eighteen months of the Obama presidency, the United States sustained no less than three terrorist attacks on American soil. The first one quickly became known as the “Ft. Hood Massacre,” an inside job wherein Nidal Hasan, a U.S. Army Major, a psychiatrist – and a devout Muslim - killed 13 Army service members and wounded 29 others, all within the confines of the otherwise “secure” Fort Hood Army Base in Killeen, Texas.

At the memorial service for the murdered service members, President Obama noted that “no faith justifies these murderous and craven acts” – implying that the Islamic faith had nothing to do with Mr. Hasan’s murderous behavior – this, despite the fact that Hasan himself claimed that he was acting in accordance with his religion.

Weeks later Umar Farouk Abdulmutallab was permitted to board a Northwest Airlines jet in Amsterdam and fly to Detroit on Christmas Day, despite repeated warning signs that the passenger intended to do harm in the U.S. While the explosives that the now-famous “underwear bomber” was able to smuggle on to the flight did not detonate to their intended extent, they did nonetheless cause an in-flight explosion.

After the attack – and after Homeland Security Secretary Janet Napolitano declared that “the system worked” (she admitted a day later that our air security system had failed), we were to learn that the man about whom repeated warnings were ignored was a “devout Muslim” and claimed to be operating at the direction of Al-Qaeda.

On May 1st 2010, NYPD officers were able to disarm an ignited bomb planted in a parked vehicle in Times Square. Two days later federal authorities arrested Faisal Shahzad in connection with the attack, whereupon federal agencies rushed to point out that Shahzad was an American citizen and that the attack was “home grown.” The authorities also tried to downplay the fact that Shahzad had only been a U.S. citizen for 14 months, was originally from Pakistan, and was also a self-described Muslim.

While seemingly ignoring the proliferation of terrorist attacks carried-out by people who call themselves Muslims, President Obama and members of his Administration have largely refused to acknowledge the pattern. Even this past week the Obama Administration officially classified the Fort Hood Massacre as merely a matter of “workplace violence,” as though the immense security breaches of a military compound were to be taken no more seriously than an angry outburst at any other business establishment.

Economic policies that encourage dependency and malign productivity:

President Obama’s speech at Osawatomie high school in Kansas last week is being heralded by some as his most profound speech thus far. But few of the President’s supporters have bothered to question if his rhetoric bares any resemblance to reality.

Prior to his inauguration, he claimed, America had been a nation where “those at the very top grew wealthier from their incomes and investments…but everyone else struggled with costs that were growing and paychecks that weren’t.”

Really? Do the President’s supporters realize that over half of the American population has private investment and savings accounts, and that such items are not merely luxuries afforded only to those “at the top?”

Elsewhere in the speech, the President noted that the upcoming election will be, in part, about “whether this will be a country where working people can earn enough to raise a family, build a modest savings, own a home, and secure a retirement.” Yet the very fact that any of us can even hope for these things demonstrates the functionality of American-styled capitalism over the past many decades.

The President, of course, ignores these economic realities. Instead, he insists that our pathway to prosperity is higher taxes, and more governmental spending of our resources – in short, more of his control over our nation’s wealth. Policies of these sorts have been painful failures for years in Venezuela, Indonesia, and his father’s homeland of Kenya. Yet the President who has positioned himself as a de facto CEO of huge chunks of the economy – with authority over everything from banks to car companies – is still vying for more control. Is this what Democrats envision for another four years – an economy that revolves around the selfish needs and desires of one man?

Email: Austin Hill

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Monday, August 8, 2011

Down Grade Is No Big Deal; But Spending Is!

Late Friday, Standard and Poor’s (S&P) announced that they had lowered the United State’s credit rating from an AAA to an AA+.  Moody's also followed suit with a down grade of their own.

In the real world, this reduction in credit rating is not a big deal. The stock market will be volatile for a few days or perhaps a week for investors to figure this out, but in the long run this reduction will have no lasting effect. The U.S. role in the World economy has not changed.

The only exception would be if the Obama administration intentionally creates a crisis.

As soon as the White House heard about the down grade, their spin machine was set into motion. They accused S&P of incompetence, they blamed Bush, they blamed the House of Representatives, they blamed the Tea Party, and they blamed the kitchen sink. Most of all, they blamed the House because of the drawn out negotiations to finally raise the debt ceiling in the eleventh hour.

You will note that they do not see themselves responsible at all. Nor did they point out that they had inherited an AAA rating from George Bush.

The down grade came as no surprise to those who were paying attention! The credit rating agencies had told anyone that would listen that the U.S. needed to cut spending by at least $4 trillion, in real spending, if we wanted to retain an AAA rating.

According to at least one S&P spokesman, the first bill PASSED by the House of Representatives and backed by the “Tea Party” would have met ALL the requirements. But as we all know the White House and Harry Reid declared it dead on arrival. Throughout the discussions on raising the Debt Ceiling, it was the Senate Democrats and the White House that stood as obstructionist’s and offered no plans of their own. And it was the Democrats that opposed all real spending cuts.

It has been made very clear that the only path back to an AAA rating must contain a ‘Balanced Budget Amendment’, because Congress cannot pass a bill that any future Congress or even by themselves cannot change.

Both parties are too blame for the massive debt. However, 80% of the current problem lies squarely on the shoulders of the Obama regime. A quote from S&P specifically said that Obamacare would require significant modifications to bring down the growing costs associated with it.

S&P never, in spite of the Democrats claims, stated that tax increases were needed and neither did Moody's.  In fact, one of their concerns was that we keep going to a relatively small number of sources with our ever growing taxation.

A GAO report stated that if we doubled the amount of taxes received from all current payers, we would still fall short of our annual expenditures by about ½ a trillion dollars.

It is the “Tea Party” that was pushing for a ‘Debt Ceiling’ bill that would have protected the AAA credit rating and moved the nation toward a sound financial policy by insisting that a ‘Balanced Budget Amendment” be moved through Congress and sent to the states.

The Democrats have been terrified by the grassroots ‘Tea Party’ movement and take every opportunity to attack them. “Why? Because that is what they do!” (line borrowed from Chris Plante/talk radio host).

However, if we are going to save this nation, Democrats, Republicans, Independents, Conservatives, and others had better adopt the ‘Tea Party’ values of getting back to the Constitution, while reducing the size and cost of the Federal government.

Ronald Reagan used to say, “The government is not the solution to the problem, the government is the problem.”

Never has that been truer than it is today. We have the EPA about to cost millions of jobs and trillions of dollars with phony baloney, Cap and Trade’ carbon regulations, Obamacare is already on its way to bankrupt the nation while destroying the best heath care system in the World, and there is the planned energy policy which will cost even more  jobs and kill the economy, just in case all else fails.

If you don’t believe that Obama wants to economically destroy America, ask yourself, If he wanted to destroy America’s economy and prestige, what would he have done differently? The answer is nothing would have been different!

No one could be that wrong or that stupid by accident!

Wake up People!  You have to be the ones that save America!

God bless the ‘Tea Party’ and all others that think like them.

Sunday, July 3, 2011

California,The “Failed State”

By Austin Hill
“Failed state.”

That sounds harsh, doesn’t it? Do a web search with the words “failed state” and names like Somalia, Haiti, and Sudan will appear on your computer screen.

Unfortunately, the 31st state in our union – California – is looking more and more like a “failed state” as well. And this should matter to every American, because like it or not, California is both a global economic epicenter and a spectacular place in the world.

My native homeland of California is home to the highest mountain in the contiguous forty-eight states (Mount Whitney), the lowest valley (Death Valley), Facebook, “Surf City, U.S.A.”(Huntington Beach), Apple Computers, The World Champion San Francisco Giants, the most fertile farm land in the world (San Joaquin Valley), eBay, Legoland, Cisco Systems, “the entertainment capitol of the world” (Hollywood), three U.S. Presidents (Richard Nixon by birth, and Herbert Hoover and Ronald Reagan by “adoption”), and Mitsubishi Motors of North America. It remains a global leader in the agricultural, information technology, and aerospace sectors. If it were its own country, it would comprise the eight largest national economy in the world.

This is to say that California can be and should be a place of robust economic opportunity across multiple sectors. But politicians and government employee labor unions have a stranglehold on the state (sound familiar?). Businesses and capital are now leaving while actual economic output is slumping.

Most academicians and government bureaucrats who keep track of the world’s “failed states” still won’t admit that Greece belongs on their lists, so the idea that California has in any sense “failed” isn’t even considered. But if we take seriously the criteria for determining a “failed state,” then the sad truth about California becomes painfully clear.

One of the most often quoted authorities on failed states is The Fund for Peace, a Washington, DC-based non-profit think tank organization, and among the many indicators of a failed state that “FFP” notes is “uneven economic development among group lines.” This notion of “uneven economic development” often has “life or death” implications in places like Zimbabwe or the Democratic Republic of the Congo, yet the idea is every bit as real in California as it regards the disparity between the government, and the private sector economy.

For the record, the government of California presently entails a budget deficit of somewhere between $10 and $15 billion – a deficit that is expected to swell to about $25 billion by the middle of 2012. With this as his backdrop, Governor Jerry Brown took office in January noting at the time that California had a history of “kickin’ the can down the road” with its budget woes, and that his plan to solve California’s dreadful fiscal problems would involve both cuts in government spending, and – if California voters approved – tax increases.

Yet Governor Brown is a life-long government employee, and will have nothing to do with cutting state spending where it is most problematic – in the arena of government employee salaries, benefits, and retirement pensions. In fact, while he has been completely unable to implement his plan of “temporarily extending” certain “temporarily inflated tax rates” (which de facto amounts to a tax increase plan), he has continued lining the pockets of unionized government employees with more lavish expenditures on their salaries, benefits, and retirement pensions.

In April, for example, Brown approved a new contract for the California Prison Guard’s union, which allows guards to accrue unlimited numbers of un-used paid vacation days each year. When a guard retires, the un-used vacation time can now be “cashed-in” at the guard’s highest salary rate- a sweet pay-off from Governor Brown to a labor union that spent nearly $2 million on his campaign last year.

And here’s where yet another set of criteria comes in to play for determining a “failed state.” According to the Fund for Peace, failed states often exhibit “a disappearance of basic state functions that serve the people, including a failure to protect citizens from terrorism and violence…” The high-minded folks at the FFP may not know this, but – shocking news! – California has so horribly mismanaged its prison system that it can’t afford to facilitate all of its prisoners.

After being taken to court over the conditions in which they were detaining convicts – which included as many as 54 prisoners sharing one toilet – the California government was ordered by the U.S. Supreme Court in May of this year to release huge numbers of prisoners. This is to say that California’s leaders had plenty of money to spend on their unionized prison guards, yet it doesn’t have enough money to properly facilitate prisoners so as to comply with federal requirements.

Is this “failure enough” to get anybody’s attention? By the FFP’s own criteria, California has failed to fulfill a “basic state function” and to protect “citizens” from “violence.”

The Fund for Peace needs to sound the alarm bells over the California government’s failures, but they probably won’t. It’s up to the state’s citizenry to demand better leadership in Sacramento – before it’s too late.

Email: Austin Hill


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Sunday, May 15, 2011

The Feds, The Economy, Your State And Your School Board

By Austin Hill The wisdom of the American people is prevailing in some of the most unlikely places.

Unfortunately, the local public school board is typically not one of those places.

As the federal government goes deficit-crazy and state governments continue to feel the recession’s impact, some good things are actually starting to develop. Fiscally conservative ideals are emerging in states as diverse as Wisconsin, Idaho, New Jersey and Ohio.

In these states and in others, governors and legislatures have stood-up to the ever-expanding demands of government employee unions, reigned-in employee compensation growth, and have cut state spending. Even in liberal Massachusetts the Democrat-led House of Representatives voted last week to limit the powers of their state government employees’ unions.

This is good news for the American taxpayer, and good news for the overall U.S. economy. But when state governments start to spend fewer tax dollars, that often means fewer state tax dollars are flowing to local public school districts. And when that happens, the affairs of local public school districts can get especially outrageous.

Your local school district may be the exception, and its collective behavior may be entirely “above the board.” But the sad reality for teachers, students, and parents, is simply this: in the face of tight budgets, most local school boards across the nation would rather fire teachers, than reign-in other school district expenses. The reason for this is simple: when teachers lose their jobs, students suffer – and “student suffering” gets parents and other voters in the mood for a tax increase.

It sounds cynical, I know. But think about it from the vantage point of political strategy. if school boards actually tried to manage the taxpayers’ money in such a way as to serve the students, first and foremost, then every effort would be made to retain good teachers and keep class sizes small. This would mean that school boards would look “up the food chain” in to the administrative ranks, rather than “down to the classrooms,” when the need arose to cut the budget.

But that’s generally not what happens in most public school districts. The preference for board members is usually to eliminate teacher positions, or at least to “threaten to eliminate” teacher positions – because when budget cuts are felt in the classroom, voters become more amenable to tax hikes – and tax hikes usually provide more money for the school district to spend.

Consider the case of the Mount Diablo School District in the San Francisco suburb of Concord. Like every other public school district in California, Mount Diablo is being threatened with a dramatic shut-off of state tax revenues, as the bankrupt state government grapples with a budget deficit of somewhere between $10 and $15 billion – a deficit that is expected to swell to about $25 billion by the middle of 2012.

So the elected members of the Mount Diablo School District met in open session last week. They heard public testimony, with local residents pleading to “spare the teachers jobs” at the open microphone. Members of the board even offered their own impassioned dissertations about how “every one of our teachers is a human being,” and many of the teachers “have their own families,” and they all “touch our families in such important and necessary ways…” And then the board voted unanimously to terminate one-hundred eleven of those “human being” teachers. Unanimously. No dissenting voters.

After getting the “dirty work” completed, the elected board members at the Mount Diablo School District then proceeded to vote in favor of spending over $9 million on school building upgrades. All in the same school board meeting, all on the same night.

The board made it clear that the $9 million or so that they were spending on structural enhancements was money approved directly by voters and designated for such purposes, and could not possibly have been spent on retaining teachers. Legally speaking, it was probably accurate that the revenues could not simply be used for “more urgent purposes.”

But doesn’t this speak to a degree of mismanagement by the district board? Why wouldn’t a school board in California be anticipating a shortfall in state tax revenues, given that the state government is broke, and begin strategizing a way to retain teachers, rather than enhancing buildings?

The mismanagement of the Mount Diablo School District becomes even more apparent when you turn the calendar back a couple of months. In March of this year, the district board voted to raise the salary paid to the district legal counsel by $28,000.00 (that person now takes home $190,000 annually), the facilities and projects manager got a raise of $11,000, and the director of certificated personnel got a nice $6,000.00 annual income boost (each one of these employees also receives taxpayer funded healthcare and retirement benefits).

If school districts genuinely cared for students, then budget cuts would more often happen at the district office rather than in the classroom. But nobody wants to raise their taxes just so the Superintendent or the staff Attorney can keep their six-figure salary and benefits. Thus, “firing teachers” becomes the best political strategy.

Students, parents, and teachers deserve much better.

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