Big Money

The size of President Obama’s is staggering.  What is perhaps more staggering, as we recoil from the numbers is the fact that for once, those numbers are real.  The budgets of George W. Bush were a joke.  Not one single Bush budget ever allowed for so much as a single dime for the wars in Iraq and Afghanistan.  We spent two and a half billion dollars a week over there—every single week--and it never made the budget.  It was an insult to the American people.  Now the question is; will we be more offended by the truth?

The pills are big and bitter.  If the President has his way we’ll be roughly paying for half the new budget with revenues and simply borrowing the rest.  He wants to borrow to restart our economy and redirect some of our national priorities.  He wants universal health care as part of the deal.  He wants to protect the millions of Americans with no health insurance.  He also wants to take the burden off American industry from having to add the health care costs to our products as we try to sell them.  It’s a brand new way of looking at the American way, but I doubt you’ll hear much about it.

Mostly you’ll hear about how the new Obama taxes are going to stall our economy.  Don’t believe it.  In the first place, our economy is already stalled.  Years of phonies running our financial community have given us trillions in bonds and more exotica which are not only indecipherable, but largely worthless.  The former president of NASDAQ has admitted to running the largest Ponzi scheme in history and swindling investors out of nearly $50 billion.  Our banking industry received hundreds of billions in bailouts, but haven’t bailed out the banks or anyone else.  The auto industry that lost a thousand dollars a minute last year is now asking for more on top of the billions they’ve already received.  Now, some of these problems are endemic to their industries and some are due to a combination of greed and colossal bad management, but all were happening years before Barack Obama came along.

In the second place, the taxes are just what he proposed during the campaign.  He intends to raise taxes on the top 5% of earners.  If you listen to the right, this will cripple investment.  It’s a myth.  His plan is to raise taxes on the rich from 35% to 39%, the same as they were under Bill Clinton.  He also plans to raise the capital gains tax, from 15% to 20%.  These are not huge increases and they’re probably not big enough.  But they are what he promised and they are logical, in that they intend to provide more money to 95% of tax payers. 

We’re going to have to be honest and we’re going to have to cut.  One obvious place is our military.  We spend more on our troops than the next 5 biggest countries combined.  We can cut.  On the top of our list should be the cold war holdovers.  We don’t need supersonic jets to fight terrorist nations.  We don’t need nuclear subs and we probably don’t need new aircraft carriers.  We do need more unmanned drones, more rapid deployment capabilities, more language skills and more electronic weapons, to name a few.  Either way, the mantra remains the same.  We need to change America and it’s going to cost us.  However, the biggest cost won’t be dollars.  The biggest cost will be the fear of stepping toward an uncertain future and I hope we’re up to it.