July 6th, 2009 | 
Author: Obama’s Health Care Package
California Controller John Chiang says the state plans to issue $3.3 billion in IOU’s in July, meaning that anyone that does business with the State will get slips of paper instead of dollars.
Obama is close to wagering everything on passing health care this year and the media hype surrounding the California debt fiasco almost assures his resounding defeat.
California has long engaged in an orgy of spend now and pay later, but compared with our present federal government, its legislators should feel unsullied.
This year’s California deficit already exceeds $26 billion but the U.S. federal deficit is now likely to be seventy times more than that!
Democrats in Washington are increasingly worried, that if Obama’s health-care plan passes that it might have to be paid for with Federal IOUs that would be worth a whole lot less than even California’s.
California’s problem is that its politics make spending cuts and tax increases impossible, and it’s easy to see Washington as a mirror image.
Professor Alexander Fraser Tyler, a Scottish historian who in 1787, writing about the decline and fall of the Athenian Republic over two thousand years before, said:
“A democracy cannot exist as a permanent form of government. It can only exist until the voters discover that they can vote themselves largesse from the public treasury. From that moment on, the majority always votes for the candidates promising the most benefits from the public treasury, with the result that a democracy always collapses over loose fiscal policy, always followed by a dictatorship.”
“The average age of the world’s greatest civilizations has been 200 years. These nations have progressed through this sequence:
From bondage to spiritual faith
From spiritual faith to great courage
From courage to liberty
From liberty to abundance
From abundance to complacency
From complacency to apathy
From apathy to dependence
From dependence back again into bondage”.
Reagan ran up huge deficits because he believed that his tax cuts would produce economic growth, and ultimately pay for themselves, but the Obama administration is apparently ready to bury the country in long term debt, simply to achieve its short-term political goals.
Do you believe;
That expansion of the welfare state will lead to economic growth?
That it will pay for itself?
Of course you don’t, and neither does anybody else, and that’s why Democrats are sweating.
Who Might Stop The Carnage?
Senator Evan Bayh and fifteen other Senate Democrats who formed a coalition of moderates might, because they believe that the $1 trillion price tag for the health care package is undoable, and they are making headway.
Opponents of the bill fear that one of the most expensive components of the Obama plan entitled, The Public-Insurance Option would result in massive government subsidies, and Senator Mary Landrieu has already said that she is “not open to a public option that will compete with private insurance”.
As the cost estimates increase and support fades, the Senate Finance Committee is even going as far as to pursue its own health-care plan and other Democratic Senators, including Ben Nelson, Blanche Lincoln, and Tom Carper are climbing on board.
Obama could get more support from moderates, if the bill also included tax increases to cover the spending increases, but such tax increases would be so unpopular that it would be impossible to pass a bill.
What Is The Most Likely Scenario?
Al Franken’s arrival will give the Democrats a crucial 60th vote, and a bill will be passed that costs nothing, and does even less.
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Posted in aid, bailout, California, economy, federal debt, government, Obama, president, Senate, taxes, US economy, USA, Washington, White House
