Fiscal Debt: Charging Ahead

By:  Charles Scaliger
02/20/2013
       
Fiscal Debt: Charging Ahead

Congressional fiscal debates are making headlines, but in reality our representatives are unlikely to substantially cut spending — despite the harsh consequences of failing to do so.

What’s a liberal to do? At the very time that President Obama and his Democratic allies in Congress are moving aggressively to fulfill two of the most cherished leftist conceits — confiscation of firearms and general amnesty for millions of illegal immigrants — economic woes continue to rear their ugly heads. Already reeling from massive tax hikes that few Americans were even expecting, the country now awaits the outcome of the other half of the fiscal cliff debate — the seemingly impossible decision to actually cut government spending.

In May, something will need to be done about the debt ceiling, although congressional Republicans have managed to kick that particular fiscal can just a little further down the road. And to top it all, the economy has begun contracting once more, with figures from the fourth quarter of 2012 pointing to a stagnant 0.1 percent decline, according to the Commerce Department. These bad tidings came a day after the government announced a steep decline in consumer confidence at year’s end, effectively erasing all the putative gains for 2012. The downturn that started with the Great Recession grinds on and on, with no end in sight, prompting many Americans to wonder where our government’s seemingly incurable addiction to debt, excessive spending, tax hikes, and expansion of its own powers will ultimately lead.

The Obama administration and its courtier-economists were quick to dismiss the dismal fourth-quarter economic figures as consequences of one-time aberrations, such as a more than 20-percent decline in end-of-the-year defense spending, in anticipation of a fizzled fiscal cliff. But as we go to press budget cuts are coming — automatically, under the “sequestration” deal reached during the last debt ceiling set-to, on March 1, unless Congress comes up with an alternative.

Meanwhile, the latest job figures, released on the first day of February, will prove harder for the Obama administration to dismiss. While the economy created 157,000 new jobs in January and 127,000 more jobs in November and December than had previously been acknowledged, the official unemployment rate crept up once again to 7.9 percent, stoking fears that it would once again breach eight percent. Unemployment, while not as acute as a few years ago in the depths of the recession, is still more than twice what America enjoyed during headier times (and, as has often been pointed out, the real unemployment numbers are well into the double digits, but newer, looser standards of reporting conceal the true extent of the problem).

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