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CNSNews.com – Chief Treasury Economist Says White House Economic Forecast is ‘Smoother’ than Can Be Expected in Reality.

(entire article reposted here – please comment!)

Alan B. Krueger, U.S. Assistant Secretary of the Treasury for Economic Policy

Tuesday, September 08, 2009
By Matt Cover

(CNSNews.com) – Alan Krueger, assistant secretary for economic policy and chief economist at the Treasury Department, told reporters that the economic projections used by the White House–which foresee a decade of uninterrupted economic growth ahead–are “smoother” than what can be expected in reality.

Even with this smoother-than-reality economic forecast, the administration is predicting that the federal government will run up an additional $905 billion in deficit spending over the next decade, almost doubling the national debt.

Krueger, speaking to reporters at a Friday briefing, said that while the administration’s Gross Domestic Product (GDP) growth forecasts were largely in line with private estimates, numerous factors could affect and alter those estimates.

“It’s the nature of forecasting that forecasts typically are smoother than the realizations,” he said. “Your hope is that the ups and downs balance out and, on average, are on the forecasted path.”

What Krueger did not mention is that, while the administration’s projections are close to those of private economists, known as the Blue Chip Consensus, those private forecasts only extend through 2010, while the White House’s extend through 2019.

When asked by CNSNews.com if the fragility of the administration’s projections meant higher budget deficits in the future, Krueger said that deficits were inevitable during bad economic times.

“Deficits are inevitable when you’re trying to recover from such a steep recession,” he said.

Krueger also said that, because of that steep recession, it was impossible for the administration to produce a balanced budget in the short term, saying such an idea was not “advisable” for Obama.

“In fact, it wouldn’t be advisable to have a balanced budget at this point or anything close to a balanced budget at this point,” he said.

In the longer run, however, Krueger said that the administration planned to put the budget back on a path toward fiscal responsibility, saying that the country relies far too much on borrowing and not enough on public investment.

“One has to draw a distinction between the short run and the long run,” he said. “Certainly in the longer run the administration plans to put the budget on a path that’s fiscally responsible.”

“In the U.S., I think that we rely too much on borrowing and short-term consumption at the expense of longer-run investment, public infrastructure,” he said. “The president has said that it’s very important that when we emerge from this recession that we build a stronger foundation, one that’s less susceptible to these kinds of boom-and-bust cycles.”

However, the Obama administration’s projected budgets rely on what Krueger criticizes: borrowing to finance short-term consumption.

For example, the Obama administration projects that, as a result of its 2010 budget, the federal government will run a cumulative deficit of $9.05 trillion by the year 2019. In total, the government plans to spend $43 trillion during the next decade while taking in only $34 trillion in tax revenue.

In no year between now and 2019 does the administration plan to balance the budget. In fact, the smallest single-year deficit Obama plans to incur is $739 billion in 2015, after which time the deficit will begin climbing again until it hits nearly $1 trillion ($917 billion) in 2019.

However, Krueger claimed that it was a “very important” part of Obama’s budget to move the country toward “responsible budgeting” and a “more sustainable” path.

“That’s why it’s very important, in the administration’s budget, that we make the critical investments in human capital and physical infrastructure, responsible budgeting, health care reform, clean energy, to move the U.S. to a more sustainable economic path,” he said.

Deflation Vs. Inflation: The Great Debate Rages On – Marc Courtenay — Seeking Alpha.

“Suppressed during the war, wages and prices exploded. Autoworkers, steelworkers and others went on strike for higher pay. In 1946 and 1947, consumer prices rose 8.5% and 14.4%, respectively.

I have wasted most of this past 13 months on Digg.com, in futile jousting with immoral collectivists who do not and will not understand the morality of the personal right to life of each individual on this planet, who seek to use the Force of government to negate our right to property, and don’t give one rip about the objective of happiness.  Our right to property is now diverted from sustaining our life and enhancing our happiness, and is now instead being ripped from our hands (stolen) toward furthering the immoral goals of collectivism via Force.

Much time was simply wasted, trying to avoid reading trivia completely irrelevant to the ongoing economic collapse, and even more trivia wading thru irrelevant comments often nothing more than ignorant abusive blurbs consisting of nothing more than FU, FTW.  While we still hang onto the thread of freedom of speech, having to deal with such ignorance wastes everyone’s time and energy for naught.

During this period we have been clobbered by the burst housing bubble, bailouts serving only to increase the national debt, to the election of a non-citizen communist who now purports to be the president of this new USSA, to an infinitely broad “stimulus bill” which we have now seen serving only to increase the already impossible mountain of national debt.  This cannot be funded because the Federal Reserve cannot find buyers for the T-bills and T-bonds, thus Government cannot pay it’s bills nor even fund the bailouts and stimulus.  This is a GOOD thing, although we doubt the liberals and socialists and collectivists will not understand this just yet!

So what has this to do with Digg?  Well, just yesterday Digg ended it’s Shout feature, which was the way we could pass good articles to our friends.  Digg now suggests Facebook and Twitter be used to compensate.  Now I don’t know that you feel this way, but having to play KissyFace and Tweeting is not my idea of useful productive time on the internet, so you’ll not find me there.  If someone knows an equally active social website devoted to active and serious discussion of philosophical political issues and ideas, PLEASE comment and let me know.

But worse with Digg is it’s now blatant attempts to promote bleeding heart crap and to conceal or even delete anything relevant to true Liberty and the current actions of Government seeking to destroy that last vestage of Freedom. For that reason alone, I am done with Digg.com.  I may submit more (of Morality101) articles to Digg, but will not be otherwise participating.  I see no compelling reason that Digg will survive these fatal mistakes.  Leave that to the collectivists to have a mutual admiration society and continue to scheme how to gain more powers to Force.

I hope to convert this blogger into THE major forum for the serious ongoing discussion mentioned.  I wlll need your help to accomplish this, there is too much for me to learn about doing this and so I need the collaboration of others.  I barely know how to “Submit” an article here via WordPress, much less to set up the tools for good interaction between us.

So, requested action(s)

• My email address is available only  to my Friends who know me as Striker101 on Digg.  If you are one of those, please either use your Digg handle or else email me so I know who you are.  You will be authorized as Authors and thus allowed to Post and to Submit.
• To others, you will find my eaddy at the root website of http://morality101.net.
• ONLY to those who understand the foundations of Objectivist or Libertarian philosophy, REGISTER here at  Morality101 so that you can participate, and then DO participate.
• We are not here to argue with collectivists, who are wholly without virtue.  We are here to expand upon the likes of Ayn Rand and Ludwig von Mises.  We are here to destroy collectivism before it destroys Capitalism, the free market and Liberty.

Leave your comments HERE, don’t even bother with Digg anymore.

Nobody wants to mention tax rises just ahead of the elections,” said Thorolfur Matthiasson, an economics professor at the University of Iceland. “But if the budget deficit is 10 percent of GDP and the official debt is approximately what the nation can produce in one year, then the politicians will have to raise tax and reduce public spending.

Striker

It’s hard to pay attention to what’s happening in such a seemingly small, remote and insignificant country as Iceland, but the parallels of retro-progress in Iceland and USA are stunning and terrifying. Think for a moment, this is a part of global collapse begun here in our USSA with the last trigger on this shotgun being the CRA. Then note our Rulers now considering renewal of the CRA to cure the problems caused by the CRA.

Please read this article and review the Digg comments.

read more | digg story

This article is quite in line with our thinking

The Ponzi scheme that U.S. Congress has been running, since 1933, is about to collapse the nation. It may take out the world, as well.

What’s the scheme?

It “takes” from taxpayers and “gives” to recipients, while taking a cut of the action for their magnanimous administration of the legalized thievery. And each shortfall is the excuse for deficits (borrowing credit, at usury).

However, this tax scheme is based upon fraudulent consent, via enrollment into Social Security. Since there is no law compelling participation, and no law punishing those who choose not to participate, it is 100% voluntary. If it was compulsory, it would be involuntary servitude and unconstitutional.

Due to the impossible contract (via usury) with creditors, evidenced by the unpayable national debt (in excess of ten trillions), the millions of “Human Resources” are burdened with an obligation that is tantamount to grand larceny on a national scale.

Though the government tries to keep us in the dark about the “voluntary” nature of national socialism, and misleads the nation into believing that “everyone” must have “the number” before they can work in the U.S.A., the law is the law. And you can ask them to produce the constitutional law that obligates all Americans to enroll, but they cannot provide it.

What will happen when 51% of the American people wake up and just say “NO” to (in)voluntary socialism?

If an American is no longer a participant in Social Security, he no longer is obligated to pay the withholding tax (FICA) on his wages, and his employer is also no longer liable.

Without a SSN/TIN, one is not a “person liable” for the individual income tax on wages. (The uniform rate Corporate Income tax is the constitutional excise tax. The Individual Income tax is graduated, and based on a private compact with the Social Security Administration and the Federal Reserve corporation.) Without an account and number, one cannot be held criminally liable for “willful failure to file.” (Again, try and find the law that makes “all Americans” into persons liable for paying a tax on wages, or the law that compels “all Americans” to make a “return of income” and file an IRS Form 1040.)

What will Congress do when 51% of the most productive Americans cease to be “voluntary slaves”? When tax revenues are slashed by 51% or more? What will the creditor do when Congress stops paying the interest on the national debt? What will holders of Federal Reserve Notes do, when their worthless nature is made clear?

Will the government capitulate to the “Will of the People”? Or will it impose martial law, and expose the awful truth of the subjugation of the American people to the foreign corporation known as the “United States”, in Congress assembled, in bankruptcy to usurers?

————- Notes: Pursuant to the Coinage Act of 1792, the national debt computes to an obligation to pay the creditor a sum of gold bullion, stamped into lawful money, that is 99.2 times the total world supply of above ground bullion. That means the national debt is impossible to pay, for all practical purposes. But due to the 14th amendment, the public debt shall not be questioned – no matter how insane it is.

The Social Security Administration’s form letter response to questions about compulsory enrollment states that the sole legal reason to enroll is to participate in the “Entitlement” program.

Congressional Research Service defines “Entitlements” as synonymous with “gifts”. Congress is under no legal or contractual obligation to pay benefits, and anything given is entirely at their discretion. There is no “Insurance contract” nor “Trust Fund”. In fact, the “Trust Fund” consists of IOUs that can only be redeemed by higher taxes in the future. All taxes collected, are spent, as part of the General Fund. (It is a Ponzi bribery scheme, paying present beneficiaries with the indentured servitude of future generations.)

In 2007, Congress borrowed MORE than it paid in debt service. In short, the Congress can no longer afford to pay the interest on the national debt. It is only a short step to the point where it can no longer borrow on the “credit” of the United States.

Pursuant to Title 12 United States Code, Sec. 411, every Federal Reserve Note (aka dollar bill) is an obligation (debt) of the Congress to pay face value in lawful money (gold / silver coin) on demand. That promise was repudiated, in 1933, in House Joint Resolution 192. But due to the “Contributors” (obligated parties) who signed up with Socialist InSecurity, the worthless notes became THEIR obligation, and thus legal tender for all debts, public AND private. When 51% leave national socialism, the FRNs will no longer be legal tender for all private debt, and may be objected to – as they have no par value. At that point, the banking / finance system will collapse, and the perpetrators may abandon the country, in fear for their lives.

JG  December 23, 2008

http://tekgnosis.typepad.com/tekgnosis/2008/12/counter-revolution.html

Last night, as soon as the polls closed in California, Obama was declared the Almighty.  Millions of cheering idiots gathered throughout our land and celebrated the end of America.

I am happy that those millions will suffer along with all who know better.  However, if you are amongst the moral, you know we must TAKE ACTION!

America has elected a lying and evasive socialist>communist illegal alien as it’s president, socialist-liberals as it’s congress, and immorality, irrationality and force as its mandate.

Public reaction to George W Bush and the policies resulting from his Hitler-maniac mentality, along with his Republican Party which lost all principle and direction, resulted in public rejection evidenced by election of liberal-socialist Democrats to Congress.

Beginning long befor Bush, but accelerated greatly during this decade,  our  nation, already in trouble, abandoned the Constitution and it’s citizens, moved into fascism and increased socialism, and wildly increased the national debt to impossible levels.  Government became all-powerful, and the screams of our citizens are now safely totally ignored.

The three generations beginning with FDR have been victimized by subtle brainwashing and have become a nation of sheeple, unthinkingly adopting a creed of sacrifice, “for the greater good”, being our “Brother’s Keeper”, and Marx’s “from each according to his ability, to each according to his need”.

The morality of the free individual and personal responsibility has been rejected.

America has led the entire world into a depression of almost unimaginable scope.  Today you are seeing only the beginning.  The America which became the greatest country on earth is gone, and is taking the world down with it.

As are we all … gone, we are entering the new Dark Age from which we may never return.

The only possibility for the survival of mankind ever seeing again the light of freedom, is that somehow mankind learns true morality.

Morality is very simple, don’t be terrified of that word.  Morality comes not of  Mysticism; it comes not of Force; it comes from the sanctity of the individual.

If you do not understand this…
Philosopher and author Ayn Rand, born in Russia and living thru the Bolshevik revolution with pure unadulterated horrible communism,  wrote the philosophy of Objectivism during much of the last century.  If anything should be required reading, it would be her works.  Many have begun with “Atlas Shrugged”, my personal “bible”. Despite that it is a long and redundant tirade, it is truth.  Others of her writings are more specific and concise.  Her books are widely available on the internet; there is no excuse for continuing one’s ignorance.

True morality is based solely on your right to life, your right to sustain that life, and your right make your own personal choices about all affects your life.  Morality demands first that you respect and honor those same rights for all others, and finally, morality also demands rejection of all who seek to control you and thereby remove your freedoms.

Digg Posted

http://digg.com/world_news/Election_Over_America_is_Lost_Time_for_Action

The fatal flaws of our two-party system are obvious. We always end up voting for the lesser of two evils. On top of this neither candidate is willing to address the real issues facing our country right now. Inflation is running rampant. Our national debt is at record levels, we are…
News with an attitude that makes sense

read more

I believe this to be the most important blurb I’ve ever written.  I have submitted this to Digg, so help us all, both at Digg It!, and have the courage to comment here at Morality101.

I am very disappointed that Ron Paul abandoned us today, telling us to ‘vote no’ by voting for any other 3rd party candidate.  Horsefeathers!  I am equally disappointed that Dr Paul chose to abandon his former Libertarian Party and play Republican.  Pseudo-Libertarian Bob Barr doesn’t even grasp libertarian principles, and has never addressed the issues and possible solutions of our economic collapse.  All the other parties and their candidates are a joke, yes, absolutely including the Republicans and Democrats.

While I might waste the gas to go write in Ron Paul, the fact is voting just became an exercise in futility.

So, back to after Digg truncated a post for me, my point is…

It seems clear to me that America can survive but little longer unless it takes immediate and drastic steps to reverse it’s progression into economic collapse.  Failing that, we may not survive even to this coming election.  Given the horrible choices for our next leadership, certainly we cannot continue on this path for another four years.  I am 70 years old; I am not and never have been a Gloom & Doom guy, but folks, we are at the end of this rope!  Unless somehow the goons in government suddenly show signs of life and rationality, which we have no reason to anticipate, the show is all over.

The economic collapse will be triggered by inflation running to hyperinflation, caused by overwhelming national debt which grows with every stimulus, every bailout, and every new socialist scheme.  There is no money for any of this, so it’s all simply being piled atop the national debt.  Our dollar will become worthless and unacceptable to the rest of the world.  The USA will have to admit it is bankrupt, however that might be accomplished, and disavow not only the national debt, but also will default on all it’s other obligations, e.g social security and medicare and welfare and highway maintenance — you name it, it will disappear.

Few of us will have enough to buy food or pay our utility bills, plain survival will make life interesting indeed!  The rich (bless ‘em) will be able to pay off their mortgages and other debt with hyperinflated money, and find tremendous bargains to the extent of their bankrolls.  But most of them will run out of money too, and find themselves holding a whole truckload of worthless T-Bills and investments as our government and private interest also collapse.

The only way I see of saving our butts depends on two key actions:

1.  Congress immediately acting to rein in or abolish the Federal Reserve.  The Fed’s manipulation of the economy must end, NOW!  The Fed must be barred from more debt and thereby expanding the money supply.  It must also be barred from tinkering with monetary policy, that which destabilizes our economy and interferes with free market capitalism, throwing us back and forth between boom and depression.

2.  Congress must reverse course immediately on everything adding to the national debt, and show the world HUGE progress toward paying that debt down.  Nothing impromptu can be added to the debt – e.g. no bailouts, no takeovers, no stimulus, no subsidies… all must end.  We may have to tell Iraq and Afghanistan and Israel that we believe we have accomplished our objectives and we’re going home.  We must tell the world we can’t support them anymore because we must deal with our own issues here at home.  We must seek to collect the abandoned debts due us around the world.  Here at home, we must eliminate most of our bureaucracy, first because of it’s immorality, and also because we can’t afford it.  Among other moves we might take would be selling off the government lands, e.g. those held by the BLM — and yes I know that would be very disruptive to the market enjoyed by big real estate investors, but perhaps they’ll take advantage, so ???  We must put an end to all support to immigrants, legal and illegal, while making it simple for enter legally for anything serving our American interests.

The above is the “short list”.  If you have something helpful to add to the above, or can contribute other solutions to our national dilemma,  registering is as easy as possible, please join us!

I may return to edit this page later, simply because both the underlying casual morality and the longer-term solutions could well be included here.

Meanwhile, those are already written in several pages you’ll find in my Tax-Strike category, along with the Libertarian and Objectivism tabs in the header at the top of all blogger pages here on Morality101.

at Yahoo! Answers: Question in regards to the Federal Reserve?
The Federal Reserve was established in 1913 and is, therefore, a creature of Congress. The President of the United States nominates members of the Board of Governors of the Federal Reserve, subject to confirmation by the Senate. However, the Federal Reserve is basically free to pursue monetary policy independent of Congress or the President. Should the Federal Reserve remain independent of the President and Congress or should the President and Congress control monetary policy? Why?

I wrote this answer, but by the time I’d finished the Q had been withdrawn.  No problem, I’d rather have it here on morality101 anyway.

Our problems with the Federal Reserve stem from, perhaps from it’s very existence, but certainly from it’s freedom to manipulate the money supply at will.

Over the last couple of years prior, in an effort to slow down inflation, the Fed caused interest rates to rise.  Among other effects, those naive souls who had taken Adjustable Rate Mortgages found their payments rising beyond their means, which caused foreclosures to increase perhaps six-fold, which resulted in mortgage bankers losing liquidity (e.g. Bear-Sterns, there will be more), which resulted in too many homes on the market, which resulted in falling home prices and the virtual shutdown of the construction industry.  All these were factors in resulting in yet another recession.

So during 2008, the Fed switched gears and lowered the discount rate several times, which bailed out illiquid mortgage bankers, which increased available mortgage money, which is enabling home buyers to purchase homes (foreclosed or otherwise) at better prices with lower loan rates again.

The whole game is predictable.  One needs understand only the very basics of economics (supply and demand applies) in order to predict the future maneuvers of the Fed.  I

In due course, the Fed will cycle us back to even greater inflation.  Inflation WILL be greater because of the rapidly increasing national debt, caused by the politicians voting for war, socialist schemes, subsidies, “stimulus” etc etc ad nauseum.  All are  passed by our politicians despite not having the money to pay for them.  Thus the congress routinely raises the national debt limit so they can borrow the funds, the Fed makes the bookkeeping entries creating more “money” (federal reserve NOTES), and like magic, it’s all a done deal.  Reason enough not to give politicians control of monetary policy, right?

Nothing in all this should be construed as my justifying the continuing existence of the Fed.  If, for the time being at least,  the Fed continues, then congress must cause the Fed to cease  manipulation of the money supply and forbid expansion of the money supply in beyond indexes of population, income, GDP and/or such other indexes as may are appropriate.  Perhaps we will rediscover that applied economics actually has some value in our world for this indexing chore.  Natural market forces will provide the monetary stability which has been absent from the beginning of the Fed.

There are many proponents for going back to the gold standard, but I’m not convinced that is necessary.  You may want to check out as a free-market alternative to the dollar – the Valun.

Up thru most of 1972 I built custom homes for $15 per SqFt, decent homes with redwood exteriors, turnkey with appliances and carpeting for a small family cost about $17,500.  30 years later, you know it, that same house cost $120,000 or more.  You bought your house from a tract builder, and paid $200,000 with a lot,

Okay, you took an adjustable rate mortgage because you couldn’t afford fixed-rate.  Then a couple of things went sour, your ARM shot up and now the bank owns your house.  C’mon, you were in over your head when you signed that mortgage!.  So now you’re crying to the government to help your sorry ass because you screwed up?  Get a grip, people, it’s not my fault and I won’t pay taxes to support you!

But maybe the government will pass a welfare bill for you anyway, because I really have nothing to say about it, do I?  It’s called taxation without representation – today that’s supposedly okay, but I will disagree with that immoral bullfeathers to the day I die.

Well let’s look at what may have REALLY happened here.

The Fed opined that the economy had heated up a too much, so they tightened money.  Things slowed down, so maybe you lost your job?  For sure, when your lender saw interest rates rising, he caught you by the ARM and raised interest/payments over your head.  Happened to many folks, so don’t feel like the Lone Ranger. So there were a bunch of foreclosures on homes bought at inflated prices.

So the bankers start whining about their Owned-Real-Estate portfolios growing out of control, and the banks had lost their liquidity.  They couldn’t resell the foreclosed homes and they didn’t have $$ to make new loans, awwwwwwwww.  Bear-Stearns then became the first of many on the brink of disaster, so the Fed quickly gave them a huge loan guarantee which saved B-S’s butt while it was sold to someone else.  But then, realizing the foreclosures were continuing, the Fed acted to make more money available by dropping the discount rate, not once, but several times, down to record low rates!  This enabled the bankers to come to the Fed window and borrow needed liquidity.  By this the bankers were temporarily saved, but you?  You aren’t allowed in the line to the Fed window, that’s a banker’s-only club.

So all this manipulation by the Fed, plus the mushrooming national debt, have weakened our dollar to the brink of collapse.  So what should we expect the Fed to do next?  They’ll soon enough be tightening money again, in a misguided attempt to strengthen the dollar.  When that happens, I suppose we’ll see some more foreclosures, but we will also start seeing the bankers tumble, and that could be domino-time.  There’s really nothing much else to be done, it’s about over, folks.  It won’t matter one whit who wins the next election.