Category Archives: Political economy

Political economy originally was the term for studying production, buying, and selling, and their relations with law, custom, and government, as well as with the distribution of national income and wealth, including through the budget process. Political economy originated in moral philosophy. It developed in the 18th century as the study of the economies of states, polities, hence political economy.

In the late nineteenth century, the term ‘economics’ came to replace ‘political economy’, coinciding with publication of an influential textbook by Alfred Marshall in 1890 Earlier, William Stanley Jevons, a proponent of mathematical methods applied to the subject, advocated ‘economics’ for brevity and with the hope of the term becoming “the recognised name of a science.

Today, political economy, where it is not used as a synonym for economics, may refer to very different things, including Marxian analysis, applied public-choice approaches emanating from the Chicago school and the Virginia School, or simply the advice given by economists to the government or public on general economic policy or on specific proposals.[3] A rapidly-growing mainstream literature from the 1970s has expanded beyond the model of economic policy in which planners maximize utility of a representative individual toward examining how political forces affect the choice of policies, especially as to distributional conflicts and political institutions. It is available as an area of study in certain colleges and universities.

Circus Politics: Will Our Freedoms Survive Another Presidential Election?

By John W. Whitehead
January 26, 2016

“Never has our future been more unpredictable, never have we depended so much on political forces that cannot be trusted to follow the rules of common sense and self-interest—forces that look like sheer insanity, if judged by the standards of other centuries.” ― Hannah Arendt, The Origins of Totalitarianism

Adding yet another layer of farce to an already comical spectacle, the 2016 presidential election has been given its own reality show. Presented by Showtime, The Circus: Inside the Greatest Political Show on Earth will follow the various presidential candidates from now until Election Day.

As if we need any more proof that politics in America has been reduced to a three-ring circus complete with carnival barkers, acrobats, contortionists, jugglers, lion tamers, animal trainers, tight rope walkers, freaks, strong men, magicians, snake charmers, fire eaters, sword swallowers, knife throwers, ringmasters and clowns.

Truly, who needs bread and circuses when you have the assortment of clowns and contortionists that are running for the White House?

No matter who wins the presidential election come November, it’s a sure bet that the losers will be the American people.

Despite what is taught in school and the propaganda that is peddled by the media, the 2016 presidential election is not a populist election for a representative. Rather, it’s a gathering of shareholders to select the next CEO, a fact reinforced by the nation’s archaic electoral college system.

Anyone who believes that this election will bring about any real change in how the American government does business is either incredibly naïve, woefully out-of-touch, or oblivious to the fact that as an in-depth Princeton University study shows, we now live in an oligarchy that is “of the rich, by the rich and for the rich.”

When a country spends close to $5 billion to select what is, for all intents and purposes, a glorified homecoming king or queen to occupy the White House, while 46 million of its people live in poverty, nearly 300,000 Americans are out of work, and more than 500,000 Americans are homeless, that’s a country whose priorities are out of step with the needs of its people.

As author Noam Chomsky rightly observed, “It is important to bear in mind that political campaigns are designed by the same people who sell toothpaste and cars.”

In other words, we’re being sold a carefully crafted product by a monied elite who are masters in the art of making the public believe that they need exactly what is being sold to them, whether it’s the latest high-tech gadget, the hottest toy, or the most charismatic politician.

As political science professor Gene Sharp notes in starker terms, “Dictators are not in the business of allowing elections that could remove them from their thrones.”

To put it another way, the Establishment—the shadow government and its corporate partners that really run the show, pull the strings and dictate the policies, no matter who occupies the Oval Office—are not going to allow anyone to take office who will unravel their power structures. Those who have attempted to do so in the past have been effectively put out of commission.

So what is the solution to this blatant display of imperial elitism disguising itself as a populist exercise in representative government?

Stop playing the game. Stop supporting the system. Stop defending the insanity. Just stop.

Washington thrives on money, so stop giving them your money. Stop throwing your hard-earned dollars away on politicians and Super PACs who view you as nothing more than a means to an end. There are countless worthy grassroots organizations and nonprofits working in your community to address real needs like injustice, poverty, homelessness, etc. Support them and you’ll see change you really can believe in in your own backyard.

Politicians depend on votes, so stop giving them your vote unless they have a proven track record of listening to their constituents, abiding by their wishes and working hard to earn and keep their trust.

Stop buying into the lie that your vote matters. Your vote doesn’t elect a president. Despite the fact that there are 218 million eligible voters in this country (only half of whom actually vote), it is the electoral college, made up of 538 individuals handpicked by the candidates’ respective parties, that actually selects the next president.

The only thing you’re accomplishing by taking part in the “reassurance ritual” of voting is sustaining the illusion that we have a democratic republic. What we have is a dictatorship, or as political scientists Martin Gilens and Benjamin Page more accurately term it, we are suffering from an “economic élite domination.”

Of course, we’ve done it to ourselves.

The American people have a history of choosing bread-and-circus distractions over the tedious work involved in self-government.

As a result, we have created an environment in which the economic elite (lobbyists, corporations, monied special interest groups) could dominate, rather than insisting that the views and opinions of the masses—“we the people”—dictate national policy. As the Princeton University oligarchy study indicates, our elected officials, especially those in the nation’s capital, represent the interests of the rich and powerful rather than the average citizen. As such, the citizenry has little if any impact on the policies of government.

We allowed our so-called representatives to distance themselves from us, so much so that we are prohibited from approaching them in public, all the while they enjoy intimate relationships with those who can pay for access—primarily the Wall Street financiers. There are 131 lobbyists to every Senator, reinforcing concerns that the government represents the corporate elite rather than the citizenry.

We said nothing while our elections were turned into popularity contests populated by individuals better suited to be talk-show hosts rather than intelligent, reasoned debates on issues of domestic and foreign policy by individuals with solid experience, proven track records and tested integrity.

We turned our backs on things like wisdom, sound judgment, morality and truth, shrugging them off as old-fashioned, only to find ourselves saddled with lying politicians incapable of making fair and impartial decisions.

We let ourselves be persuaded that those yokels in Washington could do a better job of running this country than we could. It’s not a new problem. As former Senator Joseph S. Clark Jr. acknowledged in a 1955 article titled, “Wanted: Better Politicians”: “[W]e have too much mediocrity in the business of running the government of the country, and it troubles me that this should be so at a time of such complexity and crisis… Government by amateurs, semi-pros, and minor-leaguers will not meet the challenge of our times. We must realize that it takes great competence to run a country which, in spite of itself, has succeeded to world leadership in a time of deadly peril.”

We indulged our craving for entertainment news at the expense of our need for balanced reporting by a news media committed to asking the hard questions of government officials. The result, as former congressman Jim Leach points out, leaves us at a grave disadvantage: “At a time when in-depth analysis of the issues of the day has never been more important, quality journalism has been jeopardized by financial considerations and undercut by purveyors of ideology who facilely design news, like clothes, to appeal to a market segment.”

We bought into the fairytale that politicians are saviors, capable of fixing what’s wrong with our communities and our lives, when in fact, most politicians lead such sheltered lives that they have no clue about what their constituents must do to make ends meet. As political scientists Morris Fiorina and Samuel Abrams conclude, “In America today, there is a disconnect between an unrepresentative political class and the citizenry it purports to represent. The political process today not only is less representative than it was a generation ago and less supported by the citizenry, but the outcomes of that process are at a minimum no better.”

We let ourselves be saddled with a two-party system and fooled into believing that there’s a difference between the Republicans and Democrats, when in fact, the two parties are exactly the same. As one commentator noted, both parties support endless war, engage in out-of-control spending, ignore the citizenry’s basic rights, have no respect for the rule of law, are bought and paid for by Big Business, care most about their own power, and have a long record of expanding government and shrinking liberty.

Then, when faced with the prospect of voting for the lesser of two evils, many simply compromise their principles and overlook the fact that the lesser of two evils is still evil.

Perhaps worst of all, we allowed the cynicism of our age and the cronyism and corruption of Beltway politics to discourage us from believing that there was any hope for the American experiment in liberty.

Granted, it’s easy to become discouraged about the state of our nation. We’re drowning under the weight of too much debt, too many wars, too much power in the hands of a centralized government, too many militarized police, too many laws, too many lobbyists, and generally too much bad news.

It’s harder to believe that change is possible, that the system can be reformed, that politicians can be principled, that courts can be just, that good can overcome evil, and that freedom will prevail.

So where does that leave us?

Benjamin Franklin provided the answer. As the delegates to the Constitutional Convention trudged out of Independence Hall on September 17, 1787, an anxious woman in the crowd waiting at the entrance inquired of Franklin, “Well, Doctor, what have we got, a republic or a monarchy?” “A republic,” Franklin replied, “if you can keep it.”

What Franklin meant, of course, is that when all is said and done, we get the government we deserve.

A healthy, representative government is hard work. It takes a citizenry that is informed about the issues, educated about how the government operates, and willing to make the sacrifices necessary to stay involved, whether that means forgoing Monday night football in order to attend a city council meeting or risking arrest by picketing in front of a politician’s office.

Most of all, it takes a citizenry willing to do more than grouse and complain.

We must act—and act responsibly—keeping in mind that the duties of citizenship extend beyond the act of voting.

The powers-that-be want us to believe that our job as citizens begins and ends on Election Day. They want us to believe that we have no right to complain about the state of the nation unless we’ve cast our vote one way or the other. They want us to remain divided over politics, hostile to those with whom we disagree politically, and intolerant of anyone or anything whose solutions to what ails this country differ from our own.

What they don’t want us talking about is the fact that the government is corrupt, the system is rigged, the politicians don’t represent us, the electoral college is a joke, most of the candidates are frauds, and, as I point out in my book Battlefield America: The War on the American People, we as a nation are repeating the mistakes of history—namely, allowing a totalitarian state to reign over us.

Former concentration camp inmate Hannah Arendt warned against this when she wrote, “No matter what the specifically national tradition or the particular spiritual source of its ideology, totalitarian government always transformed classes into masses, supplanted the party system, not by one-party dictatorships, but by mass movement, shifted the center of power from the army to the police, and established a foreign policy openly directed toward world domination.”

Clearly, “we the people” have a decision to make.

Do we simply participate in the collapse of the American republic as it degenerates toward a totalitarian regime, or do we take a stand at this moment in history and reject the pathetic excuse for government that is being fobbed off on us?

Source

Memo to the Fed and its Media Tool Hilsenrath: We’re Not Here to Enrich Your Corporate Cronies

June 5, 2015
Memo to the Fed: you are the enemy of the middle class, capitalism and the nation.

The Federal Reserve is appalled that we’re not spending enough to further inflate the value of its corporate and banking cronies. In the Fed’s eyes, your reason for being is to channel whatever income you have to the Fed’s private-sector cronies–banks and corporations.

If you’re being “stingy” and actually conserving some of your income for savings and investment, you are Public Enemy #1 to the Fed. Your financial security is nothing compared to the need of banks and corporations to earn even more obscene profits. According to the Fed, all our problems stem from not funneling enough money to the Fed’s private-sector cronies.

Fed media tool Jon Hilsenrath recently gave voice to the Fed’s obsessive concern for its cronies’ profits, and received a rebuke from the middle class he chastised as “stingy.” Hilsenrath Confused Midde-Class “Responded Strongly” To “Offensive” Question Why It Isn’t Spending.

Memo to the Fed and its media tool Hilsenrath: we’re not here to further enrich your already obscenely rich banker and corporate cronies by buying overpriced goods and services we don’t need. Our job is not to spend every cent we earn on interest to banks and mostly-garbage corporate goods and services. Our job is to limit the amount we squander on interest and needless spending. Our job is to build the financial security of our families by saving capital and prudently investing it in assets we control (as opposed to letting Wall Street control our assets parked in equity and bond funds).

Your zero-interest rate policy (ZIRP) has gutted our ability to build capital safely. For that alone, you are an enemy of the middle class. Let’s say we wanted to buy a real asset that we control, for example, a rental house, rather than gamble our retirement funds on Wall Street’s Scam du Jour (stock buybacks funded by debt, to name the latest and greatest scam).

Thanks to your policies of ZIRP and unlimited liquidity for financiers, we’ve been outbid by the Wall Street/private-equity crowd–your cronies and pals. They pay almost nothing for their money and they don’t need a down payment, while we’re paying 4.5% on mortgages and need 30% down payment for a non-owner occupied home. Who wins that bidding process? Those with 100% financing at near-zero rates.

Here’s a short list of stuff we don’t need to buy:

1. New house: overpriced. Debt-serfdom for a wafer-board/sawdust-and-glue mansion? Pay your banker buddies $250,000 in interest to buy a $300,000 house? Hope the bursting of the real estate bubble doesn’t wipe out whatever equity we might have? No thanks.

2. New vehicle: overpriced. We can buy a good used car and a can of “new car smell” for half the price, or abandon car ownership entirely if we live in a city with peer-to-peer transport services. We can bicycle or ride a motorscooter.

3. Anything paid with credit cards.

4. Any processed food.

5. A subscription to the Wall Street Journal and other financial-media cheerleaders for you, your banker buddies and Corporate America.

How Wall Street Devoured Corporate America: Thirty years ago, the financial sector claimed around a tenth of U.S. corporate profits. Today, it’s almost 30 percent

Here’s how your cronies have fared since you started your low-interest rate/free money for financiers policies circa 2001: corporate profits have soared:

Now look at median household income adjusted for inflation: down 4%–inflation which we know is skewed to under-weight the big ticket items such as healthcare and college education that are skyrocketing in cost:

And here’s how the middle class has fared since the Federal Reserve made boosting Wall Street and the too big to fail banks its primary goal, circa 1982: the bottom 90% have treaded water for decades, the top 9% did well and the top 1% reaped fabulous gains as a result of your policies.

If you’re wondering why we’re not spending, look at our incomes (going nowhere), earnings on savings (essentially zero) and the future you’ve created: ever-widening income disparity, ever-greater financial insecurity, ever-higher risks for those forced to gamble in your rigged casino, and a political/financial system firmly in the hands of your ever-wealthier cronies.

Capital–which includes savings–is the foundation of capitalism. If you attack savings as the scourge limiting corporate profits, you are attacking capitalism and upward mobility. The Fed is not supporting capitalism; rather, the Fed’s raison d’etre is crony-capitalism, in which insiders and financiers get essentially free money from the Fed in unlimited quantities that they then use to buy up all the productive assets.

Everyone else–the bottom 99.5%–is relegated to consumer: you are not supposed to accumulate productive capital, you are supposed to spend every penny you earn on interest paid to banks and buying goods and services that further boost corporate profits.

This inversion of capitalism is not just destructive to the nation–it is evil. Funneling trillions of dollars in free money for financiers while chiding Americans for not going deeper into debt is evil.

Memo to the Fed: you are the enemy of capitalism, the middle class and the nation.

Source

Amnesty shocker! The secret behind Obama’s ‘order’

President accused of ‘sleight of hand’ to protect self from impeachment

by Jerome R. Corsi

NEW YORK – Did President Obama just set up Department of Homeland Security Secretary Jeh Johnson to be a candidate for impeachment instead of himself if conservatives convince the Republican majorities in the House and the Senate that his “executive actions” on immigration are unconstitutional?

The inquiry begins with the question: Where are the executive orders Obama supposedly signed to permit up to 5 million parents of young illegal aliens to remain in the United States for three years?

The White House appears to have engaged in administrative sleight of hand, changing U.S. immigration law not by executive order but by a memorandum “exercising prosecutorial discretion” Johnson signed the day of Obama’s Nov. 20 nationwide address that so far has not been filed in the Federal Register.

Tom Fitton, president of Washington-based watchdog institution Judicial Watch, told WND in an interview the legal status of Johnson’s memo is a serious constitutional question that deserves to be adjudicated.

“The entire implementing authority involves a memorandum published by DHS Secretary Jeh Johnson that changes the immigration law, directing federal money to be spent that has not been appropriated by Congress,” he said.

“In my view, there is a serious question whether Jeh Johnson should be impeached for taking this action, and a criminal investigation should be initiated to determine how and why federal funds are being misappropriated,” he declared.

Fitton said DHS “is being hijacked to implement actions Congress has neither authorized nor appropriated funds to accomplish.”

“All remedy options need to be on the table when attacking this threat to the Constitution,” he said.

On Wednesday, attorneys general in 17 states joined in a lawsuit filed by Texas attorney general and governor-elect Greg Abbott that charges the Obama’s immigration action violated the U.S. Constitution’s “Take Care” clause and failed to follow the Administrative Procedure Act’s guidelines for implementing new policies, including a comment period to outline the changes’ benefits, National Review’s Andrew Johnson reported.

Abbot said in a statement the president “is abdicating his responsibility to faithfully enforce laws that were duly enacted by Congress and attempting to rewrite immigration laws, which he has no authority to do — something the president himself has previously admitted.”

The 16 other states are Alabama, Georgia, Idaho, Indiana, Kansas, Louisiana, Maine, Mississippi, Montana, Nebraska, North Carolina, South Carolina, South Dakota, Utah, West Virginia and Wisconsin.

Showtime in Vegas

The White House drew attention to President Obama’s trip to Las Vegas Nov. 21, where he was expected to sign two executive orders that would revise his Deferred Action for Childhood Arrivals, or DACA. But a close examination of the executive actions Obama actually signed shows they had nothing to do with implementing the move he announced in his Nov. 20 White House address to the nation.

According to the White House website, on Nov. 21 Obama signed a presidential proclamation titled “Creating Welcoming Communities Fully Integrating Immigrants and Refugees” and a presidential memorandum titled “Modernizing and Streamlining the U.S. Immigration Visa System for the 21st Century.”

The first of the presidential actions, “Creating Welcoming Communities Fully Integrating Immigrants and Refugees,” filed Nov. 26 in the Federal Register at Vol. 79, No. 228, in the category “Presidential Documents” at page 70769, created a White House Task Force on New Americans to “engage with community, business, and faith leaders, as well as State and local elected officials.” The task force is designed to “help determine additional steps the Federal Government can take to ensure its programs and policies are serving diverse communities that include new Americans.”

The second of the presidential actions, “Modernizing and Streamlining the U.S. Immigration Visa System for the 21st Century,” filed Nov. 26 in the Federal Register at Vol. 79, No. 228, in the category “Presidential Documents” at page 70765, empowered the secretaries of State and Homeland Security, in consultation with the director of the Office of Management and Budget, the director of the National Economic Council, the assistant to the president for homeland security and counterterrorism, the director of the Domestic Policy Council, the director of the Office of Science and Technology Policy, the attorney general, and the secretaries of Agriculture, Commerce, Labor and Education, to make a series of recommendations “to reduce government costs, improve services for applicants, reduce burdens on employers, and combat waste, fraud, and abuse in the system” of issuing immigrant and non-immigrant visas.

The only Obama administration document relevant to altering DACA to accommodate the legislative changes announced in Obama’s address to the nation Nov. 21 is a DHS memorandum signed by DHS Secretary Johnson titled “Exercising Prosecutorial Discretion with Respect to Individuals Who Came to the United States as Children with Respect to Certain Individuals Who Are the Parents of U.S. Citizens or Permanent Residents.”

The Federal Register lists 26 executive orders President Obama has signed this year, with the most recent being “Improving the Security of Consumer Financial Transactions,” signed Oct. 17 and published in the Federal Register Oct. 23.

The last item DHS filed in the Federal Register relevant to DACA was a form revision filed April 4 that had nothing to do with the actions Obama announced Nov. 20.

Who has the authority?

“What is clear is that Jeh Johnson was the vehicle chosen by the Obama administration to extend temporary residency status and work authorization to millions of illegal immigrants currently in the country,” Fitton told WND.

The “Guide to the Federal Rulemaking Process” published by the Office of the Federal Register specifies agencies “get their authority to issue regulations from laws (statutes) enacted by Congress.”

The guide states further:

In some cases, the President may delegate existing Presidential authority to an agency. Typically, when Congress passes a law to create an agency, it grants that agency general authority to regulate certain activities within our society. Congress may also pass a law that more specifically directs an agency to solve a particular problem or accomplish a certain goal.

An agency must not take action that goes beyond its statutory authority or violates the Constitution. Agencies must follow an open public process when they issue regulations, according to the Administrative Procedure Act (APA). This includes publishing a statement of rulemaking authority in the Federal Register for all proposed and final rules.

Johnson’s Nov. 20 implementing memo is technically the announcement of a decision to exercise prosecutorial discretion, not a change in rules.

“Deferred action is a long-standing administrative mechanism dating back decades, by which the Secretary of Homeland Security may defer the removal of an undocumented immigrant for a period of time,” Johnson’s memo noted.

Fitton said an important question is whether or not the Johnson memo is subject to public comment provisions.

“This is a legal question given the impact of the Johnson memo is to stop effectively deportations of illegal immigrants that have been in the United States prior to Jan. 1, 2010, and are parents of children who are U.S. citizens or legal U.S. residents,” he said.

Johnson’s memo attempts to make the deferred prosecution decision announced for the DACA program equivalent to an executive action taken by two recent Republican presidents.

“A form of administrative relief similar to deferred action, known then as ‘indefinite voluntary departure,’ was originally authorized by the Reagan and Bush administrations to defer the deportations of an estimated 1.5 million undocumented spouses and minor children who did not qualify for legalization under the Immigration Reform and Control Act of 1986,” the memo said “Known as the ‘Family Fairness’ program, the policy was specifically implemented to promote the humane enforcement of the law and ensure family unity.”

The memo then attempted to further distinguish deferred action from rulemaking by noting the temporary aspects of the prosecutorial discretion involved:

Deferred action is a form of prosecutorial discretion by which the Secretary deprioritizes an individual’s case for humanitarian reasons, administrative convenience, or in the interest of the Department’s overall enforcement mission. As an act of prosecutorial discretion, deferred action is legally available so long as it is granted on a case-by-case basis, and it may be terminated at any time at the agency’s discretion. Deferred action does not confer any form of legal status in this country, much less citizenship; it simply means that, for a specified period of time, an individual is permitted to be lawfully present in the United States. Nor can deferred action itself lead to a green card.

Finally, the memo acknowledges that the actions taken with respect to the DACA program are not specifically authorized in any legislation passed by Congress and signed into law by the president.

Although deferred action is not expressly conferred by statute, the practice is referenced and therefore endorsed by implication in several federal statutes.

Fitton told WND that while Obama has maintained that his administration has issued executive orders just as prior administrations have done,” he’s now saying the memo signed by Johnson ‘”changed the law.”

In a speech in Chicago after his Nov. 20 announcement, Obama told hecklers, “I took action to change the law.” Confronted with the statement by reporters, White House press secretary Josh Earnest insisted the president was “speaking colloquially.”

But Fitton said there is nothing comparable to Obama’s admission in recent presidential history.

“Obama’s statement is an admission of tyranny.”

Source

August In Mid-America”Psst” :: Obama; Come On Out And Bring Pelosi, Schumer And Reid With You

August 3, 2014
By Cultural Limits
 

The Secret Service would probably ruin a good time

One afternoon last week, another member of the Limits household and I played hooky and floated a pretty flat five-mile stretch of a river no one outside of Missouri has ever heard of.  At one point, as we passed a fairly organized campground, the smell of a wood fire wafted over the river along with eau de old and moldy canvas tent.  With that, nostalgia set in.  When we were growing up, those were the smells of summer vacation.

Martha’s Vineyard was just out of Mom and Dad’s price range.

To be honest, in this part of the country, from Friday to Sunday (mostly Saturday, but there has to be some travel time) during June, July and the first two weeks of August, every quiet, still. picturesque river teaming with turtles, snakes, trout, tadpoles and the occasional black tailed deer becomes a bank to bank party zone.  The working stiffs get out of the city, lose the cell phones and kick back for a couple days.  SUVs and pick-ups are traded for canoes, inner tubes and rafts (not necessarily in that order).  Every tree hanging over a remotely deep part of the river becomes an opportunity for a swing rope.  (Thoughtful floaters have left many in the trees for those who follow, too.)  Cliffs over five feet are for jumping – if you dare.  Hermetically sealed air-conditioned houses are left behind for all the nylon tents and air mattresses Coleman sells.  (Actually saw somebody use a window unit run off a generator to cool off a tent once.)  Natural waterways are polluted with sunscreen, among other fluids.  And many adult beverages are consumed.

Out here in this part of flyover country, this is standard summer unwinding procedure.  In other states, there are methods of R & R in the great outdoors that are more of the hiking and cycling variety.  It’s not for everybody, but, hey, neither is lobster and cosmos.  To each his or her own.

Working people everywhere need a chance to shut down for so many reasons.  Take a break from all the stress, the angst, the constant bombardment of information, etc.  We all do.  Rest is essential for not just health, but effectiveness.  That is why in United States we call time away to recharge “vacation” as in “vacate” or leave.

The problem we are having this August in the United States is that our vaunted government – at least the top of the food chain – is bound to the beach, vineyards, lakes, and spas without having really done any work.

Somehow, we all doubt that they are headed to the party zones for less than the cost of one of Nancy Pelosi’s broomsticks to spend an afternoon doing jello shots in their bikinis and cut-offs.

But that did start me thinking:

  • What would San Fran Nan look like wearing one of those old-fashioned orange life jackets that are basically nylon over squared off foam three inches thick with a hole for the head?  And does she have earrings to match in her collection?
  • Does Chuck Schumer know what to do with a canoe paddle or would he bring a driver from the New York State motor pool to steer?
  • Once Dingy Harry got a bath in the river and settled in his inner tube, would he get stuck there?  And would he remember to bring a lanyard for his glasses?
  • Would any of them drink Busch Light from a can and then actually put the can in the trash bags provided by the canoe rental companies?  Conservation, recycling and all that jazz since no glass is allowed on the rivers.
  • How about drinking wine from a box?  There’s a Chardonnay that’s actually not bad, but somehow it’s doubtful that after refining an international palate, Inside the Beltway types would appreciate the finish.  Especially when river water mingles with it.
  • Joe Biden, please keep your swim trunks on.  One should not skinny dip in the rivers.  Scares the fish.
  • Michelle in a bikini… [shudder] or eating s’mores with marshmallows roasted over an improvised beach fire…she probably wouldn’t even be able to fathom packing lunch in a cooler.
  • And, of course, there’s Sheila Jackson Lee, Eleanor Holmes Norton, and Maxine Waters.  They’d be forced to talk to each other which would echo off of every flat surface for miles and they might get their hair wet or break a nail…on second thought, leave them behind.  After all, their shoes would definitely get wet and that might start a riot.

Was that racist?

Now that it’s August and the city here has pretty much emptied out, as it always does for the first two weeks of August (seriously, no meetings happen because there’s so many people vacating), and Congress has decided to recess with all sorts of national and international fires that need tending (not that Congress can do much about it by themselves), how’s about Obama and the gang come out here to flyover country and find out how we bourgeoisie vacate in a hurry.  No oysters, caviar or Dom, but we can offer fresh fruits and veggies, summer sausage, brats, hot dogs, hamburgers and cereal.  Anything more than that is a little fancy for the camp-site.  (Okay, if one brings along a sterno or camp stove, eggs and bacon for breakfast can happen.)

Think we’d get any takers?

Yeah, me neither.

Note to the White House: Vacations are possible without involving the swanky shores of Martha’s Vineyard.  At least the Reagans and Bushes vacayed at their own property and the Clintons used the Presidential Retreat House on St. John in the USVIs that’s already secure.  They didn’t inconvenience regular people and they were able to unwind just fine.

Source

The President’s Legal Authority at the Debt Limit

By Andrew Kloster

Some time between the middle and the end of October, the federal government will reach a hard limit on the amount of debt it can issue, and its ability to finance governmental operations will be affected. Confusion about the debt limit abounds, and this Issue Brief will address some common questions.

What Is the Debt Limit?

The United States debt limit, or debt ceiling, is the statutorily defined amount of debt the U.S. Treasury can issue, either by borrowing from the public or issuing an intragovernmental receipt to special accounts, such as the Social Security or Medicare trust funds.[1]

The Treasury Department has to have liquidity, or cash on hand, to disburse the funds necessary to meet its contractual obligations. The federal government maintains this liquidity by managing governmental receipts (such as income tax payments) and selling debt (such as Treasury bonds).

Will a Government Shutdown Occur If the Debt Limit Is Not Raised?

The debt limit is often confused with the expiration of appropriations bills. Reaching the debt limit is distinct from a government shutdown. A government shutdown occurs when appropriations authorization expires: Unless there is a law saying that money may be spent on a project, money may not be spent on that project.[2] A debate over an appropriations bill is a debate over whether to fund a specific government function. When the government shutdown began, only certain statutorily defined “essential” government functions have continued to operate.[3]

The debate over the debt limit, however, is a debate over how to finance governmental operations—reaching the debt limit would not force a government shutdown. Currently, the debt limit is $16.699 trillion.[4] The federal government reached this limit on May 19, 2013, and Treasury has since used statutorily allowed “extraordinary measures” to avoid issuing additional debt and still have the cash on hand to finance day-to-day operations. When the Treasury exhausts these extraordinary measures, the federal government will continue operating. However, the President might decide that federal employees, for example, will not necessarily be issued checks available to cash immediately.

Even without the ability to issue additional debt, the government will continue to accrue legal obligations; it will simply not be able to immediately liquidate (pay cash for) those obligations.[5]

What Happens to the U.S. Debt If We Reach the Debt Limit?

It is impossible to tell what would happen if the debt limit is not raised.[6] If Congress and the President are unable to reach an agreement on raising the debt ceiling, markets and credit rating agencies might interpret this negatively as unwillingness of the U.S. government to honor its obligation. If the President chooses to default on all obligations rather than a few (discussed below), this could exacerbate the problem. Market perception of U.S. sovereign debt directly affects bond yields (interest rate paid) on U.S. debt, so decisions the President makes can actually save or cost the government money in the long term.

The Prompt Payment Act[7] provides that the “temporary unavailability of funds to make a timely payment” does not excuse delayed payment and that the government is responsible for paying interest charges on such delayed payments. Over time, these interest penalties capitalize, so the federal government ends up paying compound interest. Depending on how the President manages payments, statutory interest payments may be greater or smaller.

What Would the President Prioritize?

While there have been proposals to cabin the authority of the executive to prioritize payments,[8] as it stands there is no statute governing how to manage government finances past the debt limit. Since governmental obligations would exceed receipts, exceeding the debt limit logically implies that at least some obligations would be delayed. These obligations would thus, by definition, be in default. There is no general “governmental default” past the debt limit; default would occur with respect to specific obligations that the President chooses not to prioritize.

There are constitutional backstops on the President’s otherwise plenary authority to prioritize payments.[9] Of these, the most important is that the President may not prioritize payment in violation of the Due Process Clause of the Fifteenth Amendment. He may not, for example, choose to pay the salaries of federal employees of one race before paying the salaries of federal employees of another race. Subject to this limitation, the President’s prioritization choices are essentially unbounded.

The President could, of course, play a game of political brinksmanship and fail to pay any obligations until the debt ceiling is raised. He could argue that all obligations are on an equal footing and that prioritizing payments violates some principle of fairness. Former Treasury Secretary Timothy Geithner made statements about the political unworkability of prioritization in the past,[10] but to date, Treasury has not disavowed its legal authority in this area. Failing to prioritize debt obligations would have far-reaching consequences, however, including potentially increasing the cost of servicing the debt long after the debt limit crisis ends.

Further, to the extent that this situation would involve having cash on hand and failing to pay some receipts, this option implicates the Congressional Budget and Impoundment Act of 1974, which prevents the President from deferring any “budget authority.” This phrase is defined to include “borrowing authority, which means authority granted to a federal entity to borrow and obligate and expend the borrowed funds.”[11] Holding cash until such time that the Treasury can meet all of its payments necessarily includes deferring expenditures of borrowed funds until such time as the debt ceiling is raised, which would implicate these statutory limitations.[12]

The President could also choose to continue payments for “essential” services analogous to those defined in the appropriations context.[13] There is no statutory requirement for this decision, but the idea that there are “core” functions of the federal government that ought to remain liquid is easily understandable. Meeting debt obligations and paying military personnel might be prioritized at the expense of other obligations, such as issuing certain grants and loans to private-sector firms and to state and local governments, for example. So-called mandatory spending, such as Social Security payments, do continue during a government shutdown, but they need not be prioritized at the debt limit.[14]

The President could also pick and choose among programs he likes and those he does not like. He might direct Treasury to pay Department of Defense employees before Department of Education employees, or vice versa. Whatever decision he makes would be essentially unchallengable in court.

Ultimately, however the President chooses to manage payments, delays will accumulate and worsen until either spending is cut or the debt ceiling is raised.

Broad Authority

In brief, the President has broad authority to manage government payments to avoid defaulting on federal obligations. He can choose which payments to make and in which order, and these choices will impact the effects on the average U.S. taxpayer and the economy.

—Andrew Kloster is a Legal Fellow in the Edwin Meese III Center for Legal and Judicial Studies at The Heritage Foundation.

Show references in this report

Source

%d bloggers like this: