Last gasp of the lame duck Congress
This week has been a busy one for our elected representatives. Many of them will not be returning in the New Year as they were resoundingly defeated in the November 2 elections. The members are now working overtime in their last attempt to pass their bills before they are thrown out of office. Obviously Mr. Reid and Mrs. Pelosi did not listen to the message that taxpayers sent to them in the election. Instead they want to ram through legislation on immigration, unemployment insurance and taxes as well as bypass the budgetary process. This is their last kick at the cat for at least two years and they are using it! As I watched the news coverage of the tax legislation, I realized that our politicians are using the British Imperial concept of divide and conquer to obliterate any opposition.
The tax bill provides for the extension of the Bush tax cuts including tax cuts for the wealthy. The Democrats claim this is a giveaway to the rich at the expense of the poor. The bill also extends unemployment insurance for another 13 months. The Republicans are ranting that they do not want to pass this, but are "seeking common ground" to get the tax cut. The legislation permits those out of work to get up to 155 weeks of unemployment insurance payments. This upsets the working class who still have jobs. I heard one person this week say that "he works for their food". Clearly it is the intention of this government to pit the working population against the nonworking population and the "rich" against the poor.
The death tax portion of the bill is codifies the last chance to rip off the taxpayers. Our Congress wants to grab taxpayers' estates, and tax them before their children get a dime! We all worked hard for our money and when we leave this earth most of us do not want to see 35% to 55% of our wealth go to the government. They've already taxed us and they continue to tax us on everything we earn. I don't mind paying taxes on my earnings, but I don't want the government to rob our nation's children of the little bit of money their parents and grandparents have put aside. (There is a $5 million exemption, but that could change). Representative Weiner made a fool of himself when he attempted to explain that there is no double taxation. He stated that it is not a double tax because the taxpayer is dead. He continued to claim that he was not taxing the dead. If you did not see the video of his foolish defense of this tax yet, you must watch it. (http://www.youtube.com/watch?v=JO9PqfGUFZE). He continued to rant throughout the interview that the taxpayers are dead therefore they are not being taxed. Well, our estate is being taxed and the wealth is being taken from our children and our grandchildren. Was Mr. Weiner's intent to pit the dead against the living? Now that is something no Democrat has ever done and no Republican would even consider. This bill passed the Senate on Wednesday and may pass the House before you read this article.
On the housing front, the government favors people who have not paid their mortgage over those who pay their debt each and every month or have paid off their mortgage entirely. By encouraging renegotiation of payments for those who are delinquent, the government is slowing the eviction and foreclosure processes. The administration has created a generation of squatters who live in houses that they do not pay for. Currently it takes up to two years for the eviction process to be completed. When the bulk of these foreclosures are finalized, it is possible that the housing market will be flooded and prices will decline. This will hurt those who pay their mortgage on time each month as the value of their property may end up to be less than the value of the mortgage. The lame duck Congress clearly supports the deadbeats who can't pay their bills and penalizes those who make their payments on time.
Another example of the rush to utilize the lame duck session is the 1,924 page omnibus spending bill. The bill finally made it to the Senate, three days before the Christmas break. As I write this article, Senator Reid stated that he is willing to keep the Congress in session until January 4th. Will he let the Congress go home for Christmas? Or is this just another threat to force those who are against this legislation to give in and vote for it? There is no time for this bill to be properly considered or studied. The supporters of this bill say it must be passed or else the government will shut down on Saturday (December 18th). This Congress had many months to go through the budgetary process, yet they chose not to do so. They knew that they could not get their pork through committee, so they waited until the last minute to place thousands of earmarks in this bill. If it passes, they can claim they brought the bacon home to their districts. This bill must be stopped as it will result in a massive increase in spending and additions to an unsustainable deficit.
There must be a penalty for the foolhardy behavior of our representatives. Shutting down the government for a few days is not out of the question. Our representatives can pass another one of their crazy continuing resolutions to fund the government until the end of February. This will give the new Congress, which will be seated January 5th, a chance to create a budget following the normal process. The outgoing Congress believes that the new Congress will not accept much of the pork in the current Omnibus bill. This is their last chance to get their favorite projects funded and they are not going to miss the opportunity if they can help it.
There certainly has been no "transparency" that the President talked about during his election campaign. I suspect this will be another one of those "pass it then find out what is in it bills" like the health care bill passed last Christmas. Billions of dollars have been allocated to the pet projects of senators and congressmen on both sides of the aisle. Our representatives may see this bill as an attempt to buy votes at home but I see it as an attempt to squander what is left of our nation's wealth. Our national debt is approaching $14 trillion and these bills will certainly take it up to $16 trillion by the end of 2011. It will take several generations to pay off this debt.
The massive deficit needs to be funded. This means the Federal Reserve must create money by buying bonds through a process called Quantitative Easing, which results in the devaluation of the dollar. In my opinion, it is another way to cause class warfare. The poor have few if any investments. They have nothing to lose with inflation while the rich will watch their investments devalue over the next few months. If it continues for several years, they too could be poor. Inflation could make paupers out of all of us. The stimulus failed, Quantitative Easing 1 failed, Quantitative Easing 2 (QE2) is also doomed to fail. Since QE2 is doomed, I suggest that the Federal Reserve forgo selling $600 billion in bonds. Instead they should just print $600 billion in $100 bills. They could then load up airplanes and carpet bomb our cities with the $100 bills. As ridiculous as this sounds, it would certainly get the money into the hands of the people. To me, this makes more sense than giving it to the financial institutions.
Please don't fret. There is hope. We are in the last days of this Congress. On January 5th the new Congress will be seated. They know why they were elected. To ensure they do, we need to send them emails, faxes and letters. We want the new Congress to rein in spending, cut the size of government and reduce the deficit. If they succeed, then our country will be stronger. If they fail, then our nation very likely will default on our debt within the next five years. What will China and Saudi Arabia do if we default on the debt they funded? We may find out if Congress does not tighten their belts, act responsibly to address our deficit, create a favorable investment environment for business, and reduce unemployment.
© 2010 Gordon Smith All Rights Reserved