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Written by Ann Shibler on Wednesday, May 05 2010 14:30.

The credit card mentality of today’s society is having a rather stultifying effect on the average citizen’s ability to objectively assess legislation, its direct costs, cost effectiveness, and payback terms. Combine that with a reliance on government solutions to any and all problems with highly bureaucratic schemes, add in the loud voices of big unions, and you have a recipe for ... smooth and easy passage of the Local Jobs for America Act, H.R. 4812.

Introduced by Madam Pelosi friend and fellow California Democrat, Rep. George Miller, this bill now has 154 cosponsors. The details of the bill indicate that it is a gigantic bailout of government employees and union jobs. Miller insists that the first stimulus did a “pretty fair job” but "clearly is not going to be sufficient" to reduce the current 9.7 percent national unemployment rate, so he’d like to get another stimulus-type bill passed. However, this new piece of deficit spending will come at the expense of hardworking American taxpayers.

In a summary provided by the House Committee on Education and Labor, the bill will miraculously create jobs out of thin air with no budgetary concerns — no pay-as-you-go restrictions on this measure — support public sector jobs, help community organizations (ACORN?) and thereby stimulate local business in a trickle down effect, all without raising taxes.

The U.S. Department of Labor will oversee the distribution of $75 billion over two years to local governments, community-based organizations and states to save and create jobs. Cities of 50,000 or more will receive 70 percent direct funding, those under 50,000 will have to somehow snag a portion of 30 percent of the funds from state governments. Poverty numbers come into play also; cities with higher poverty levels — usually larger cities — and higher unemployment will get first dibs.

Clearly a temporary stop-gap measure that serves an immediate purpose besides the obvious union job protection — think how effectively such legislation would win the support of unions, government employees of all stripes, teachers, etc., for the bill sponsor, cosponsors, and congressmen who vote for its passage. Those who accept the money will be left holding the bag when it all runs out in two years, and will be back to square one.

The perks for unionized government employees are pretty nice. No wage or salary cuts nor cuts to cushy benefits need to be taken according to the House Committee on Education and Labor:

Employees would have to be hired full-time with benefits, under existing contracts or agreements. The federal funding can be used to cover all costs, including salaries and benefits.

There is no cap on per-employee costs, however, no more than 20 percent of the funds can be used for management employees.

Fifty percent of funding received can be used to retain employees — or bring back ones already laid off. This is a sweet symphony to the ears of mayors in places like San Francisco. That city is already planning on rehiring 17,000 laid off workers. This will be no small chunk of change.  In a city like San Francisco, over 9,000 employees earn at least $100,000 a year, and many earn well over $200,000. A clearer picture emerges when you search the overall earners in the various departments.

Across the Bay smaller municipalities, about 15, are salivating over their share of tax money as well, expecting as much as $340 million between them.

Rep. Miller is a firm believer in spending more than the government has, courtesy of taxpayer’s wallets, as a necessity for boosting the economy: “I think it should be considered part of the Recovery Act, funded out of the deficit," Miller said. "You cannot cure the deficit when you're running with 15 million unemployed, and you can't cure it at the local level by laying people off and raising taxes.” Of course, you can’t cure the deficit by continuing to increase the deficit, but somehow Miller fails to grasp this concept.

Politico actually ran an article entitled “Address jobs now and deficits later,” authored by a member of the Economic Policy Institute — solidly behind the Local Jobs for America Act — and the CEO of the Peter G. Peterson Foundation, that bastion of the tax-and-spend power elite. These power elites would have us believe that a short-term deficit is a good thing — they completely ignore the long-term effects — as long as this country’s structural deficit is addressed.  Any reference to long-term deficits and national debt is termed a “useless dichotomy” and they say they believe that public spending (government spending of taxpayer money) easily substitutes for private spending in boosting the economy. Apparently they are not graduates of Austrian economics, or even a high school class in basic economics.

The bill provides an additional $23 billion to help support 250,000 education jobs, $1.18 billion for 5,500 more cops on the beat, and $500 million for firefighters. One concession to Main Street America, as opposed to the perks contained for unions and government employees, is $500 million for job training. The details certainly make a misnomer out of the title of the bill, don’t they?

Aside from Rep. Miller’s legislative pork for the folks back home, the bill’s union elements are serious and frightening. The Heritage Foundation’s “Morning Bell” ran a highly interesting expose and well-documented piece on the Service Employees International Union’s (SEIU) troubles and also on Obama’s admitted debt to that union. It’s easy to connect the dots and conclude that perhaps this bill is partial payback for the 2008 elections.

It’s no wonder that every major union, from SEIU to the AFL-CIO, teacher’s unions, mayor’s organizations, county employee associations, global think tanks like the Peter G. Peterson Foundation, every socialist, Marxist community organization, and hosts of liberal foundations, institutes, committees, centers, and policy makers obviously favor a bill they stand to benefit from at the expense of the American work force’s overly-taxed wages.

H.R. 4812 would bail out union jobs for large cities and postpone large public sector layoffs until after election time. While many Americans are losing their jobs, having their wages frozen, or seeing their wages or salaries cut back along with all sorts of benefits, this newest scheme would keep the unionized government employees in the pink. Private sector workers will once again bailout out the fat cats in the public sector and in the community organizations that have no constitutional right to taxpayer money. The ridiculous claim that one million jobs will be created by this legislation must be seen for what it is — a ludicrous lie to get Main Street Americans to look the other way while their money is being poured into the pockets of those who elected the present administration and Congress.

If you are not in favor of this bill that keeps on giving to unionized government employees and unnamed community organizations, contact your congressmen and let them know your feelings on the matter.

Written by Ann Shibler on Wednesday, April 21 2010 15:55.

federal reserveAs early as next week, the Senate floor will become the battleground for the next item on the Obama agenda that would dramatically affect all Americans, the economy, jobs, and basic freedoms. This is the financial regulatory overhaul legislation, the Restoring American Financial Stability Act of 2010 (S. 3217), which was introduced by Senator Christopher Dodd on April 15 after Dodd's Senate Banking Committee had approved the bill on March 22. This highly complex and lengthy bill is yet another bureaucratic regulatory nightmare.

Written by Ann Shibler on Wednesday, February 03 2010 10:34.

real moneyThe legal tender laws of the United States are found in Article I, Section 8 of the Constitution and grant power to Congress to “coin money, regulate the value thereof, and of foreign coin, and fix the standard of weights and measures.”  Nothing more.

In the Constitution’s Article I, Section 10, the states were restricted in regard to money: “No state shall ... coin money; emit bills of credit; make anything but gold and silver coin a tender in payment of debts.”  Bills of credit is a term used by the Founders to describe what we have come to know as unbacked paper currency, or fiat money.

So, we know that the federal government was never given the authority to issue paper currency, while the states were specifically prohibited from doing so. In 1792 the U.S. Mint set to work, constitutionally authorized to do so, stamping coinage of a fixed size, weight and purity for people who brought in their gold and silver. There were also private mints that did the same work.  There was no government monopoly and no unbacked paper money issued by the federal government.

However, U.S. Treasury notes, unbacked by gold or silver, were issued beginning in 1862 during the Civil War. Known as "greenbacks," this fiat paper currency was made official legal tender by an act of Congress in 1862. This legal tender status guaranteed that creditors would have to accept greenbacks despite the fact that they were not backed by gold, bank deposits, or government reserves, and bore no interest. Then in January of 1875, Congress passed the Specie Payment Resumption Act, which returned gold backing for these notes beginning the first of January 1879.

Jumping ahead to 1913 when the Federal Reserve was created, we see the Fed issuing its Federal Reserve Notes, circulated side-by-side with U.S. Treasury Notes, bearing the phrase “redeemable in gold.” That didn’t last long. In 1933 FDR’s administration outlawed possession of gold and the people were ordered to turn in all they had. Almost simultaneously, the Federal Reserve notes declared they were “redeemable in lawful money.” But gold was no longer lawful money; silver still was, but silver redemption was abolished in 1968.

The transformation, then, from honest money, backed by gold and silver, to fiat money redeemable in absolutely nothing, was complete. The nation barely noticed the new debased and devalued currency, perhaps because they were mesmerized by the growing stack of greenbacks in their pockets. The purchasing power of the dollar has shrunk by almost 95 percent since 1913 because of the takeover of the money supply by the Fed; inflation is rampant and the Fed continues to ratchet up the printing presses, further devaluing the dollar.

But there is a way out of the downward spiraling valuation of fiat money. 

Congressman Ron Paul (R-Texas), has once again prescribed just the right medicine for what ails this country’s monetary system by introducing H.R. 4248,  the Free Competition in Currency Act of 2009 (See 5-minute video explanation by Rep. Paul.). An advocate of sound money, Congressman Paul noted that, to be useful and honest, currency has to be, just as it has historically been, durable, portable, divisible, uniform, stable, reproducible and scarce -- gold and silver certainly fit the bill. “Currency, or money, is what allows civilization to flourish,” he stated upon introducing his very short, clear, precise and understandable bill.

The purpose of the Act is to reintroduce a system of competition in currencies. By eliminating legal tender laws that give the Federal Reserve a monopoly over our money supply, the Federal Reserve would lose its power to manipulate the money supply and therefore its value. Doing away with laws that prohibit private mints from creating coinage would also end the Federal Reserve’s money monopoly. Eradicating the capital gains and sales taxes on gold and silver coins, platinum palladium or rhodium bullion coins is just plain common sense -- after all, a sales tax is not applied every time we exchange a $10 bill for a roll of quarters -- and would set the groundwork for real prosperity.  And along with the above, repealing federal criminal code pertaining to precious metals would be a protection against government confiscation and penalties.

Rep. Paul’s concluding paragraph in his "Statement Introducing the Free Competition in Currency Act" properly proclaims:

Allowing for competing currencies will allow market participants to choose a currency that suits their needs, rather than the needs of the government. The prospect of American citizens turning away from the dollar towards alternate currencies will provide the necessary impetus to the US government to regain control of the dollar and halt its downward spiral. Restoring soundness to the dollar will remove the government’s ability and incentive to inflate the currency, and keep us from launching unconstitutional wars that burden our economy to excess. With a sound currency, everyone is better off, not just those who control the monetary system.

A case to help illustrate what sound money can do rests in the once-great, agriculturally-based bread basket of Africa, Zimbabwe. Suffering from a dictatorship that imposed wage and price controls and bad economic policies that resulted in massive hyperinflation that destroyed the manufacturing and production base that in turn effected an enormous rise in hunger and poverty, Zimbabwe has recently seen a remarkable turnaround in the last year. 

Zimbabwe’s Finance Minister Tendai Biti suspended the use of their completely worthless currency and instead legalized the U.S. dollar as currency. Zimbabwe resident Cathy Buckle wrote that Biti’s move “eradicated the black market almost overnight, stopped super-hyperinflation instantly and put real money in people’s pockets.  But, more importantly to everyday life, Mr. Biti’s policy put food back in the shops.”  Ms. Buckle went on to relate how badly state control damaged even the communication system of the nation.  Since the introduction of the U.S. dollar, cell phones proliferate which she credits with having an impact on the reduction of crime and the increase in freedom.

Once one grasps the concept that sound money is necessary for the prosperity of any nation, that sound money can be the difference between freedom and tyranny, and that it is certainly the prescription for reversing the approaching economic tsunami created by the Federal Reserve, it becomes even more difficult to accept the current political rhetoric that emphasizes increasing the national debt, installing a national health care system through a gargantuan 2,000 page bill, increasing spending toward the idea of creating jobs, etc.

H.R. 4248 was introduced in early December and as yet has no cosponsors. It probably won’t see the light of day as it is buried in several committees -- Financial Services, Ways and Means, and Judiciary -- unless Americans make clear to their elected representatives that a true stimulus is needed, in the form of sound money that can only come about by eliminating the Federal Reserve’s current chokehold on the money system.

Contact your representative and senators today and urge them to commit themselves to really stimulating the economy by supporting H.R. 4248. Any other policy or program is disingenuous, no matter how it’s sugarcoated, painted, or marketed to we, the people.

Written by JBS Staff on Tuesday, January 26 2010 14:01.

Obama, deficitAs if Americans are not getting enough good news about the U.S. economy, the Congressional Budget Office just came out with the projected estimate for the 2010 federal deficit. It is projected to hit a whopping $1.35 trillion.

Fortunately, President Obama has a solution to our economic woes. Although we endured a government spending spree including a $787 billion stimulus package by the Obama administration, the President has now reversed course and has come up with a spending freeze — excluding entitlement programs such as Medicare and Social Security, International affairs, homeland security, defense spending and veterans affairs — as a solution. The proposed freeze would cap our current discretionary spending level each year to $447 billion.

Written by Ann Shibler on Wednesday, January 20 2010 12:48.

Jobs listingThe miserable failure of the first job stimulus package is well known.  Fraught with typical government waste, little accountability, and success statistics that proved to be blatantly false, the jobs that were supposed to be created did not materialize, because government cannot create jobs, only subsidize them with taxpayer money.  Now, with as many as 3 million Americans losing their jobs since the first Recovery Act, a second jobs bill, stimulus round two, is set to take center stage in the upcoming congressional session. While the House passed H.R. 2847 on December 16, a new version is said to be in the works for the Senate.

Back in November President Obama said about the jobs package, “We all know that there are limits to what government can and should do, even during such difficult times.”  One cannot spend one’s way into a job, anymore than one can spend one’s way out of debt. Nonetheless Obama left the door open to take another whack at it saying, “But we have an obligation to consider every additional, responsible step that we can [take] to encourage and accelerate job creation in this country.”

So, the Obamanomics policy, while Madame Speaker Pelosi cheerleads, “jobs, jobs, jobs,”  in the background, is to “invest”—spend, spend, spend—in a second opportunity for political graft and corruption with yet another extremely expensive jobs program that will be as ineffectual in creating real jobs as the first failure was.

The Jobs for Main Street Act of 2010 as it has been dubbed, H.R. 2847, authorized spending $154 billion. Some money was earmarked for infrastructure projects, housing, and clean water. While other areas of spending the $154 indicate that sustaining or growing the bureaucracy is priority with the protection of public employees, teachers, and prison guards, with additional police positions in the works as well.  Highway and transit projects are also top priority. Keep in mind these are just possibilities though; anything can happen, or not, after the bill is passed.

One problem is that spending on infrastructure, highway projects, and bridges doesn’t affect unemployment rates, so says an Associated Press analysis which was reviewed by independent economists from five universities. "There seems to me to be very little evidence that it's making a difference," said Todd Steen, an economics professor at Hope College in Michigan who took part in the review. Emory University economist Thomas Smith told the AP. "As a policy tool for creating jobs, this doesn't seem to have much bite."

In just one example, AP reported that per capita, Marshall County, Tennessee, received more money than most other counties with no improvement in unemployment:

Obama's stimulus is paying the salaries of dozens of workers there, but local officials said the unemployment rate continues to rise and is expected to top 20 percent soon. The new money for road projects isn't enough to offset the thousands of local jobs lost from the closing of manufacturing plants and automotive parts suppliers.

"The stimulus has not benefited the working-class people of Marshall County at all," said Isaac Zimmerle, a local contractor.

Rep. Jerry Lewis, (R-Calif.) commented, "Why don't we just put everyone in the United States on the federal government payroll and call it a day?" From a practical point of view, this would be far more effective, as the entire bureaucratic tangle would be avoided, and checks would go out directly to the citizens with far less chance of abuse and corruption taking place. Rep. Paul Ryan (R-Wis.) compared the new House jobs bill as a "second stimulus" with just a different name. "They're already trying to use different rhetoric to sell (the legislation)," he said. "It's nothing but a new spending spree."

Another problem that will resurface in the ensuing debate on the new jobs bill is just how “jobs saved, jobs created,” is measured, and by whom.  Conflicts abound.

The three-member White House Council of Economic Advisers came out, just last week and in time for the upcoming debates on the new bill, with a fantastically positive report that employment was boosted to the tune of 1.5 to 2 million jobs (wide spread) because of the Recovery Act.  Upon inspection however, a council member admitted that they never looked at what the unemployment rate would have been without the Recovery Act. So much for accuracy.  Add to that the breakdown in job-reporting calculations that were much in evidence and the recipe is there for less than precise results, even if jobs created is something that could be measured.

This, however, will all be glossed over with a new measuring standard -- or lack thereof.  The White House has applied a new method to their madness of measuring stimulus jobs “saved or created.”  Under the new rules the White House will tally jobs by each quarter, and all recipients of stimulus funds will report all jobs, doesn’t matter whether they were new or existing -- exit the “jobs saved” designation.  One wonders if a new designation will be “Jobama” or “Jobamania.”

The changes were made in order to “make it as easy and simple for the funding recipients,” as possible, said White House Office of Management and Budget spokesman Tom Gavin. Rep. Darrell Issa (R-Calif.), didn’t fall for that one at all: “"They are trying to inflate the numbers because the numbers don't look that good," he said. "They want a better number."

Using the new perspective that failure is success, big government will increase heavy taxation of successful businesses and citizens in order to shift jobs from the private sector where they originate and create wealth, to the public sector that is unproductive and wasteful -- it is the exploitation of the free market. All increases in government spending lead to decreases in private savings; the only thing that grows is government.

In the Senate debate we can look forward to highly inflated “jobs created, jobs saved” numbers, positive rhetoric like “investment” being used to justify another spending spree, and a sinister definition of job success based on “proven [government] methods” for helping America’s jobless return to work. The focus will be that the Senate version is a scaled down version that is less costly and more workable.

What we can expect in reality if a second jobs bill is passed, is a lowering of living standards, redistribution of jobs and money from the “haves” to the “have nots,” more bureaucratic mismanagement, disappearance of many jobs, and another example of a temporary government program becoming a permanent tax-and-spend debacle.
 
Workers will keep jobs, or find new ones, only when the burdensome anchor of big-government interference is removed from the free market system, and when sound money has been restored, so that investors and employers are free to engage in the entrepreneurship and job creation Americans are famous for.

Contact your representative and senators and tell them to vote “No” on any Senate version of the Jobs for Main Street Act of 2010 (H.R. 2847) and any similar House-Senate compromise jobs bill. Urge them instead to reduce the tax and regulatory burden on American businesses so that investors and employers, via the free market, can engage in the entrepreneurship and job creation that Americans are famous for and which built this once-great nation.
 

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