A Good Friday Thought

Jesus paid it all. All to Him I owe.

What Does "As a share of GDP" Mean?

From the top story at Foxnews.com at this hour, dealing with Standard & Poor's lowered outlook for U.S. sovereign debt:

"Both political parties now agree that it is time to begin bringing down deficits as a share of GDP," Mary Miller, assistant secretary for financial markets at the Treasury Department, said in a written statement. "We believe S&P's negative outlook underestimates the ability of America's leaders to come together to address the difficult fiscal challenges facing the nation."

"...as a share of GDP..." What does that mean to you? Let's convert the numbers (presently in the trillions) to ones we more commonly understand. Suppose the "gross domestic product" of your household—for this example, all of the income generated by all the people in the household—is $50,000 in the year 2011. Because you spend like the government, you have spent $60,000 and generated $10,000 debt this year, which is 20% of your household GDP. [This would be in addition to the many years of debt you've been racking up prior to 2011.] As the leaders of your household come together for a meeting, they all agree that annual debt consisting of 20% of household GDP—up from, say, 12% in previous years—is pretty high, and that something needs to be done about it. After all, it's getting harder to make all the credit card, car, vacation home, jet ski, timeshare, home alarm system, and charity payments to lazy neighbors simultaneously.

So here's what one of them says:

We need to rein in our debt by keeping it at the level of 20% of household GDP.

And the rest of them? They all should look at the speaker and, as politely as possible, point out how stupid that is and how utterly ineffective it is in dealing with the problem...and once the speaker understands that, they should point out that in the long-term, this will only make the problem worse.

What the speaker is implying is this: That if next year's household income rises to $60,000—a very optimistic forecast in the current economy—it will be OK to incur $12,000 (that's 20% of $60,000) more in debt, to add to all those prior years' worth of debt. For that matter, even if one of these people should recommend that the debt be limited to 12% of household GDP, it's still a bad idea; the way to get rid of debt is to reduce spending to below the level of income!

And this the federal government does not yet seem to understand. Our leaders in Washington DC need to determine what needs to be done, as soon as possible, to get the level of government spending to less than the level of government income.

If they want suggestions, I will be happy to offer them.

Who Voted for the Ryan Bill?

Today the U.S. House passed a bill on a 235-193 vote for a budget plan which was spearheaded by Paul Ryan (R-WI). It likely won't even see a vote in the Senate, but even if it got through there, it is likely the president would veto it.

Every single D in the House voted against it. Every Republican except four of them voted for it. (Not sure what those four—Jones, McKinley, Paul, and Rehberg—were thinking.) Feel free to contact your Congressman and let him know what you think about his vote.

Full details on the vote can be found here.

Who Voted for the Budget Bill?

Earlier today, the House and Senate passed a budget for the remainder of the fiscal year. President Obama is expected to sign the bill on Friday, April 15. [Ponder the irony for a moment.]

It did, however, receive bipartisan opposition. In the House, 108 D's opposed it while only 81 supported it; 59 R's opposed it while 179 carried the bill to passage. The Senate saw it passed by a 81-19 vote, with 3 D's and the quasi-democrat Sanders (I-VT) in the "Nay" column.

The bill, if looked upon as a serious attempt to deal with annual federal spending, is actually a joke. Consider this quote from the afore-linked FoxNews article:

Conservatives in particular were disappointed after a Congressional Budget Office report showed the package only saves $352 million from non-war accounts this year -- compared with the $38.5 billion in cuts Boehner had claimed.

The CBO study confirmed the measure trims more than $38 billion in new spending authority relative to current levels, but many of the cuts come in slow-spending accounts like water-and-sewer grants that don't have an immediate deficit impact. Other cuts come in areas where the government was unlikely to spend the money anyway, CBO suggested.

$352 million?? At the rate of the past two years, that's about 2 hours' worth of deficit!! And it's slightly less that 1% of what was "claimed" as a $38.5 billion cut. In short, this is merely a token. It should not be claimed as any sort of serious effort at reducing federal spending.

I am happy to say that my U.S. Representative, Trey Gowdy (R-SC 4th district), and both my U.S. Senators (Jim DeMint and Lindsay Graham) voted against the bill. Had I still lived in MI today, my U.S. Representative, Fred Upton (R-MI 6th district) and one of my U.S. Senators (Debbie Stabenow, D-MI) voted for it. The other senator, Carl Levin (D-MI), voted against it.

Find how your U.S. Representative voted here.

Find how your U.S. Senators voted here.

My Manny Ramirez dia-Tribe

In general, I can't stand Manny Ramirez.

He is the absolute antithesis of a role model. His career, aside from his impressive statistics, has been tainted by multiple drug scandals, apathy, lack of effort, and a bizarre eccentricity some have labeled as "Manny being Manny" (that some find it pleasantly amusing says something about them).

He was drafted by the Cleveland Indians and played for them from 1993 to 2000. His career there was generally good but when he was able in 2000, he signed an enormous eight-year deal with the Boston Red Sox. During that span of time his eccentricities became more and more obvious. In 2003, the Red Sox put him on waivers, meaning that basically any team that was willing to assume his enormous salary could have him outright, and there were no takers. His 2004 season was memorable, and the Red Sox won the World Series that year. Various problems began to surface in the final four years with the Red Sox, both in the clubhouse and elsewhere. He seemed to express disapproval with his contract situation in 2008 [how you express disapproval making $20M/year is beyond me] by giving less-than-full effort and the Red Sox, by then fully disgusted, sent him packing to the Los Angeles Dodgers, where he miraculously revived and finished the season with great results. The Dodgers then signed him to a two-year deal paying him $45M.

Within the first two months of the season, Ramirez received a 50-game suspension for violating MLB drug rules. It would later come out that this had not been his first drug-related interaction with MLB. His 2010 season included both time on the DL and increasing Dodger frustration with him. They put him on waivers and the Chicago White Sox, willing to pick up the balance of the salary, claimed him. He hit 1 home run in 24 games and became a free agent.

He signed a one-year, $2M deal with the Tampa Bay Rays in early 2011. He batted 1-for-17 (.059) and, when informed of a forthcoming 100-game suspension from MLB for yet another drug violation, decided to retire instead of serving the suspension.

To summarize: Except for perhaps Cleveland, every team that has had Ramirez on their team has either actively sought to get rid of him or let him walk at the end of a season (or in the case of Tampa Bay, he retired in disgrace). He plays hard when he wants to and loses focus when he doesn't. He has manipulated his effort (ask Boston) in attempts to manipulate a bigger contract. He has talent without character and skills without morals. He repeatedly violated the rules. Despite his massive talent, teams did not want him. While you might want your son to earn his contract, you wouldn't want him to emulate Manny's personal life.

I sincerely hope that Manny Ramirez is never elected to the Hall of Fame.

How Democrats Historically Respond to Losing

Earlier this year 14 Wisconsin senators and a bunch of Indiana representatives, who found themselves in the minority party in their chambers, decided to hightail it to Illinois [formerly known as "Land of Lincoln" but new nicknames like "Land of Democrat Refugees" should be considered] to simply stop business from occurring in the legislatures of their states. In so doing they showed contempt for their offices and the citizens who voted for them. They also showed deep contempt for the democratic process. We live in a country where "We, the People" elect representatives to our government. These people—like it or not—were the elected representatives. But instead of doing the honored job which they were elected to do, they behaved like the pouting 5-year-old who takes his proverbial ball and heads home. It probably goes without saying that if Republicans tried something like this, they would be publicly demonized for years to come. Now rewind to the years 1860-1861. Democrats had been the majority party for about a decade due to the demise of the Whig party and other events. The 1850's saw multiple pieces of legislation which the Democratic party supported—and the infamous Dred Scott Supreme Court decision, the second worst decision of the Court in our nation's history—passed and signed into law by democrat presidents. These pieces of legislation infuriated many who saw them as contrary to the principles and freedoms which America was founded upon. Members of other parties stayed in their seats and dutifully voted, even when in the minority. In 1860, Abraham Lincoln, a Republican, was elected president. Before he even took the oath of office, seven entire states—commandeered by democrats—seceded from the Union. Within weeks after the inauguration, four more entire states—also commandeered by democrats—seceded also. I'm predicting that if our current president gets voted out next year, we may see members of the Democratic Party try similar stunts in Washington in 2013.