As 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.

The 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.
 

UPDATE, 12/17/09: The House passed H.R. 4314 to raise the national debt ceiling by $290 billion by a vote of 218 to 214 on December 16. The Senate is expected to vote on this $290 billion debt limit increase sometime before Jan. 1. Since both House and Senate will be voting on yet another debt limit increase, probably amounting to $2 trillion, in the first couple months of 2010, be sure to let both your representative and senators know just how much you oppose the continuation of huge federal deficits which these debt limit increases enable.

The annual federal deficit (amount by which government’s expenditures exceed its tax revenues or income) for fiscal year 2009 was the largest in history at over $1.4 trillion. The national debt, which is an accumulation of the annual federal deficits and other government debts, now stands at precisely $12,081,709,382,532.35. By the time you read this, it will have climbed even higher. The national debt now amounts to about 90 percent of the size of our nation's gross domestic product for one year!

The current national debt limit stands at $12.1 trillion and predictions are we’ll smash into that on New Year’s Eve -- Happy New Year! When the debt hits the statutory limit, the U.S. Treasury would be unable to borrow more money, and wouldn’t be able to pay the interest on government bonds. If Congress had been exercising fiscal responsibility during the past year, there wouldn't be this emergency need for a debt limit increase.

Congressional leaders had been planning to raise the debt ceiling by another $1.8 to $2 trillion this month, which they hoped would be large enough to avoid another politically unpopular vote on a debt limit increase in the election year of 2010. However, some centrist Democrats have recently vowed to vote against such a large debt increase unless it would be tied to the creation of a new commission that would consider ways to solve the federal deficit problem.

Since Congress can't avoid raising the national debt before the end of the year, the latest plan is to vote on a smaller increase, $290 billion, which would get the federal government through another couple months. The House is voting on H.R. 4314 today to increase the national debt ceiling by $290 billion with the understanding that another vote will be required to raise the debt ceiling again in a couple months.

We need to take advantage of these votes on debt limit increases to pressure Congress to restore fiscal responsibility now. Click here to send an email message to your representative and senators telling them to vote no on any bill to increase the debt limit ceiling unless that bill, or a companion bill that would have to be passed at the same time, would restore fiscal responsibility by requiring Congress to have a balanced budget for fiscal year 2010 and each year after that.

The Federal Reserve Act was originally rushed through Congress just before Christmas in 1913. The inherent dangers in creating the central but quasi-private bank were noted by some congressmen at the time, and warnings issued about the dangers of monetary inflation if such a centralized monopoly was created.

Today those warnings have materialized with the Federal Reserve controlling the amount of currency in circulation, the value of that currency, and even the interest rates on borrowed currency. In essence an independent and separate financial government resides in the Federal Reserve, and it all takes place without congressional input or oversight. This state of affairs is unconstitutional and needs to be reversed.

A hold changes voting requirements. Instead of the usual 50 votes, democrats would need 60 senators to agree to bring the nomination to a vote. “The American people did not bargain for ... another four years for one of the key architects of the Bush economy,” said Sanders as he pointed to Bernanke’s failure as fed chairman.

Installed on February 1, 2006 by George Bush to take the place of Alan Greenspan, Bernanke is the establishment’s man, supported by President Obama and leftist and centrist Democrats and Republicans.

Bernanke has been much criticized for his role in the current economic crisis. Since Bernanke took the helm of the Fed, the dollar has lost about 50% of its value as measured by the price of gold. During the same time as the dollar was losing 50% of its value against gold, the money supply of dollars increased by twofold as measured by the "monetary base" of the Federal Reserve. In brief, during this time of unprecedented economic and financial crisis, including the extraordinary increases in our nation's federal deficits and national debt of the past couple years, the Bernanke-led Federal Reserve has papered over these problems with large-scale increases in the money supply. While such increases in the money supply might appear to be benign over the short term of days, weeks, and months, these money supply increases have a devastating long-term effect on virtually all Americans by devaluing their income (both current earnings and retirement), investments, and insurance. For example, the dollar has lost about 95% of its value since the Federal Reserve was established in 1913.

While Bernanke is strongly in favor of maintaining the Federal Reserve’s independency and even refused to answer questions about the Fed’s role in the economic crisis, there is a growing demand for the end of Bernanke’s leadership and also for real transparency in the form of a Federal Reserve audit. Writing on the effort to audit the Federal Reserve John F. McManus pointed out, “The American people are being cleverly divested of their wealth. And power over what happens in our nation sits more with the Fed than it does with Congress.”

In order to end the illegitimate power of the Federal Reserve and the guarded secrecy of elitist money managers like Ben Bernanke, a good first step would be in opposing his reappointment.

Many Banking Committee members have already announced their support for Bernanke’s confirmation, with Committee Chairman Christopher Dodd (D-Conn.), leading the way., saying the nomination will be easily approved. However, three committee Republicans, Jim DeMint (S.C.), David Vitter (La.), and Jim Bunning (Ky.) are opposed to the nomination. The panel’s ranking Republican Richard Shelby's (Ala.) view, is an unknown at this time. 

For now the Senate Banking Committee will be voting on Bernanke’s nomination.  If approved, the nomination will then move to the Senate floor where it will probably be scheduled for a vote sometime in early 2010. Although his term ends Jan. 31, Bernanke will most likely continue at the helm of the Fed as “acting chairman” until a permanent appointment is made.

Contact your senators and let them know they should oppose the reappointment of Ben Bernanke as Chairman of the Federal Reserve.