National Debt reaches $14.3 Trillion!! Financial Terror

[Guest Hang em High]

34 GOP Senators (around 75% of the GOP Senators) and 91 GOP Congressmen (50% of the GOP Congressmen) voted for Bush’s TARP Socialist bailout of Wall Street, a transfer of 700 billion dollars of taxpayers’ money to their campaign-financing buddies on Wall Street along with the Dems. The vote was on October 1st right before the October re-election recess. It was found shortly thereafter that $53,000,000 dollars was transferred to the campaign funds of Democrat and GOP Congressmen and Senators who had voted for TARP. The money was traced to Wall Street banking and securities firms. Source: “Meltdown” by Thomas E. Woods Jr, p. 5, a book endorsed by Ron Paul.

[Guest pingback]

Good topic. In 1965 America was the largest creditor nation in the world. Today America is the world’s largest debtor.

[Bluto]

How many zeros in a trillion?

 

The next time you hear a politician use the word 'trillion' in a casual manner, think about whether you want the 'politicians' spending YOUR tax money.

 

A trillion is a difficult number to comprehend, but after some serious drinking on this I had an epiphany while watching Land of the Lost.

 

10 trillion seconds ago it was 314,870 BC. Neanderthals were living in Europe. I am sure they could open beer bottles with their teeth. But, could they imagine owing 96 million woolly mammoth carcasses?

 

This may be the reason for the extinction of the megafauna. And possibly the Neanderthals. The politicians may have indirectly killed Chaka.

 

 

Note. I used today's current value for beef stock.

Edited December 31, 2009 by Sen. Blutarsky

[Guest Human]

Russia’s' infrastructure is falling apart, and currently the Russians WILL need a massive amount

Of money to rebuild their infrastructure. More than their current strategic holdings, as well as their monetary system combined.

 

------------------------------------------------------------------------------------------------

The largest currency reserve managers, namely China and Russia want a new alternative global reserve currency, including expanded SDR to incorporate the yuan and ruble.

[Guest 420]

The U.S. Debt Clock show the trouble we are in.

 

http://www.usdebtclock.org/

 

We need to do something to stop this.

[Guest Bob Dobbs]

National Debt Understanding Test

 

This test only has one question, but it's a very important one.

 

By giving an honest answer, you will discover where you stand morally in our economic crisis. The test features an unlikely, completely fictional situation in which you will have to make a decision. Remember that your answer needs to be honest, yet spontaneous.

 

THE SITUATION:

 

You are in Florida , Miami to be specific. There is chaos all around you caused by a hurricane with severe flooding. This is a flood of biblical proportions. You are a photojournalist working for a major newspaper, and you're caught in the middle of this epic disaster. The situation is nearly hopeless. You're trying to shoot career-making photos. There are houses and people swirling around you, some disappearing under the water. Nature is unleashing all of its destructive fury.

 

THE TEST:

 

Suddenly you see a bunch of old men screaming in the water. They are fighting for their lives, trying not to be taken down with the debris. You move closer. Somehow they look familiar. You suddenly realize who theses men are: It's Alan Greenspan, Phil Gramm, John Thain, Timothy F. Geithner, Ben Bernanke, Lloyd C. Blankfein, Gary Cohn, and Jon S. Corzine!! At the same time you notice that the raging waters are about to take them under forever.

 

You have two options:

 

OPTION A - You can save their lives

OPTION B - You can shoot a dramatic Pulitzer Prize-winning photo, documenting the deaths of the world's most powerful cartel.

 

Here's the question, and please give an honest answer....

 

THE QUESTION:

 

Would you select High Contrast Color film, or would you go with the classic simplicity of Black and White?

[Guest Amy]

The Democrats have done a horrible job repairing our economy. They put so many restrictions on companies it makes me wonder why any business would want to be here. Scott Brown is going to spearhead REAL CHANGE in Washington.

[Guest Daniel]

The U.S. has allowed the total federal debt (including debt held by government agencies, like the Social Security fund) to balloon by 50% since 2006 to $12.3 trillion. The pain of repayment is not yet being felt, because interest rates are so low--close to 0% on short-term Treasury bills. Someday those rates are going to rise. Then the taxpayer will have the devil to pay.

[Guest LAW]

Today Congressman Chris Van Hollen (D-MD) issued the following statement on final passage to establish statutory pay-as-you-go (PAYGO) requirements:

 

“Today is an important day for budget discipline in America. For the first time since 2002, Congress is once again bringing the force of law to the common sense proposition that the federal government should pay for what it buys. The history is clear – when Congress lived under PAYGO in the 1990s, we turned deficits into record surpluses. After PAYGO was abandoned, deficits skyrocketed and our national debt nearly doubled.

 

“Everyone is entitled to their own opinions, but not their own facts. It is a fact that before President Obama was sworn in last year, America faced a record budget deficit of $1.3 trillion. It is also a fact that virtually all of last year’s fiscal imbalance is attributable to the legacy of financial mismanagement that President Obama inherited from the previous Administration. The Bush Administration felt no need to pay for a variety of programs, including tax cuts for the wealthiest Americans, the war in Iraq, and the prescription drug program. All of that was placed on our national credit card, pushing us further into the red. We are working now to address the damage that reckless spending caused.

 

“PAYGO is proven, common sense fiscal policy. It will force Congress to prioritize and make the same kinds of choices our constituents make every day. Under this legislation, virtually any new policy that reduces revenue or increases mandatory spending will have to be offset elsewhere in the budget. In reinstating PAYGO, we’ve put our nation back on the path to fiscal responsibility.”

[Guest Fedup]

This was my favorite Superbowl commercial.

 

Children: I pledge allegiance to Americaʼs debt, and to the Chinese government that lends us money. And to the interest, for which we pay, compoundable, with higher taxes and lower pay until the day we die.

 

VO: American tax payers owe more than $500 million in interest payments every day to cover our governmentʼs debt, much of that debt is owe to foreign governments. Go to DefeatTheDebt.com.

 

[Guest Paul Craig Roberts]

The global crisis is understood as a banking crisis brought on by the mindless deregulation of the U.S. financial arena. Investment banks leveraged assets to highly irresponsible levels, issued questionable financial instruments with fraudulent investment grade ratings, and issued the instruments through direct sales to customers rather than through markets.

 

The crisis was initiated when the U.S. allowed Lehman Brothers to fail, thus threatening money market funds everywhere. The crisis was used by the investment banks, which controlled U.S. economic policy, to secure massive subsidies to their profits from a taxpayer bailout and from the Federal Reserve. How much of the crisis was real and how much was hype is not known at this time.

 

As most of the derivative instruments had never been priced in the market, and as their exact composition between good and bad loans was unknown (the instruments are based on packages of securitized loans), the mark-to-market rule drove the values very low, thus threatening the solvency of many financial institutions. Also, the rule prohibiting continuous shorting had been removed, making it possible for hedge funds and speculators to destroy the market capitalization of targeted firms by driving down their share prices.

 

The obvious solution was to suspend the mark-to-market rule until some better idea of the values of the derivative instruments could be established and to prevent the abuse of shorting that was destroying market capitalization. Instead, the Goldman Sachs people in charge of the U.S. Treasury and, perhaps, the Federal Reserve as well, used the crisis to secure subsidies for the banks from U.S. taxpayers and from the Federal Reserve. It looks like a manipulated crisis as well as a real one due to greed unleashed by financial deregulation.

 

The crisis will not be over until financial regulation is restored, but Wall Street has been able to block re-regulation. Moreover, the response to the crisis has planted seeds for new crises. Government budget deficits have exploded. In the U.S. the fiscal year 2009 federal budget deficit was $1.4 trillion, three times higher than the 2008 deficit. President Obama’s budget deficits for 2010 and 2011, according to the latest report, will total $2.9 trillion, and this estimate is based on the assumption that the Great Recession is over. Where is the U.S. Treasury to borrow $4.3 trillion in three years?

 

This sum greatly exceeds the combined trade surpluses of America’s trading partners, the recycling of which has financed past U.S. budget deficits, and perhaps exceeds total world savings.

 

It is unclear how the 2009 budget deficit was financed. A likely source was the bank reserves created for financial institutions by the Federal Reserve when it purchased their toxic financial instruments. These reserves were then used to purchase the new Treasury debt. In other words, the budget deficit was financed by deterioration in the balance sheet of the Federal Reserve. How long can such an exchange of assets continue before the Federal Reserve has to finance the government’s deficit by creating new money?

 

Similar deficits and financing problems have affected the EU, particularly its financially weaker members. To conclude: the initial crisis has planted seeds for two new crises: rising government debt and inflation.

 

A third crisis is also in place. This crisis will occur when confidence is lost in the U.S. dollar as world reserve currency. This crisis will disrupt the international payments mechanism. It will be especially difficult for the U.S. as the country will lose the ability to pay for its imports with its own currency. U.S. living standards will decline as the ability to import declines.

 

The financial crisis is essentially a U.S. crisis, spread abroad by the sale of toxic financial instruments. The rest of the world got into trouble by trusting Wall Street. The real American crisis is much worse than the financial crisis. The real American crisis is the offshoring of U.S. manufacturing, industrial, and professional service jobs such as software engineering and information technology.

 

Jobs offshoring was initiated by Wall Street pressures on corporations for higher earnings and by performance-related bonuses becoming the main form of managerial compensation. Corporate executives increased profits and obtained bonuses by substituting cheaper foreign labor for U.S. labor in the production of goods and services marketed in the U.S.

 

Jobs offshoring is destroying the ladders of upward mobility that made the U.S. an opportunity society and eroding the value of a university education. For the first decade of the 21st century, the U.S. economy has been able to create net new jobs only in domestic nontradable services, such as waitresses, bartenders, sales, health and social assistance and, prior to the real estate collapse, construction. These jobs are lower paid than the jobs were that have been offshored, and these jobs do not produce goods and services for export.

 

Jobs offshoring has increased the U.S. trade deficit, putting more pressure on the dollar’s role as reserve currency. When offshored goods and services return to the U.S., they add to imports, thus worsening the trade imbalance.

 

The policy of jobs offshoring is insane. It is shifting U.S. GDP growth to the offshored locations, such as China, thus halting growth in U.S. consumer incomes. For the past decade, U.S. households substituted an increase in indebtedness for the lack of growth in income in order to continue increasing their consumption. With their home equity refinanced and spent, real estate values down, and credit card debt at unsustainable levels, it is no longer possible for the U.S. economy to base its growth on a rise in consumer debt. This fact is a brake on U.S. economic recovery.

 

Stimulus packages cannot substitute for the growth in real income. As so many high value-added, high productivity U.S. jobs have been offshored, there is no way to achieve real growth in U.S. personal incomes. Stimulus spending simply adds to government debt and pressure on the dollar, and sows seeds for high inflation.

 

The U.S. dollar survives as reserve currency because there is no apparent substitute. The euro has its own problems. Moreover, the euro is the currency of a non-existent political entity. National sovereignty continues despite the existence of a common currency on the continent (but not in Great Britain). If the dollar is abandoned, then the result is likely to be bilateral settlements in countries’ own currencies, as Brazil and China now are doing. Alternatively, John Maynard Keynes’ bancor scheme could be implemented, as it does not require a reserve currency country. Keynes’ plan is designed to maintain a country’s trade balance. Only a reserve currency country can get its trade and budget deficits so out of balance as the U.S. has done. The prospect of U.S. default and/or inflation and decline in the dollar’s exchange value is a threat to the reserve system.

 

The threats to the U.S. economy are extreme. Yet, neither the Obama administration, the Republican opposition, economists, Wall Street, nor the media show any awareness. Instead, the public is provided with spin about recovery and with higher spending on pointless wars that are hastening America’s economic and financial ruin.

[Guest GIJoe]

How about putting $11T back into our economy via repatriation of foreign accounts? Strengthens U.S. dollar vs. foreign currencies.

[Guest LAW]

http://www.gather.com/viewArticle.action?articleId=281474978042902

 

How ingrained is deficit spending in Congress? Consider this: Over the forty years ending in 2008, revenues have averaged about 18.3 percent of our economy, while spending has averaged over 20.6 percent, resulting in an average deficit of about 2.4 percent.

 

The federal government's long term “fiscal exposure” – the sum of all the benefits, programs, debt payments, and other expenses – will cost taxpayers huge sums in the future, regardless of whether or not it cuts discretionary spending.

 

In the first eight years of this century, that fiscal exposure has grown from $20.4 trillion to $56.4 trillion – a 176 percent increase. That is a financial obligation of unimaginable size and scope.

 

For decades, government revenues have not kept up with spending. Or, perhaps it's best to say that government spending has continually, and significantly, exceeded government revenues. As a result, the government has borrowed vast sums of money – and pays huge sums interest – to make up the difference.

 

Based on the GAO’s latest long-range alternative budget simulation, within about twelve years, our interest payments will become the largest single expenditure in the federal budget. By 2040, all of our federal tax revenues will add up to cover only our two biggest expenses: interest on our debt plus Medicare and Medicaid. Everything else – Social Security, defense, education, road building, you name it – will fail to be funded.

 

The Republicans and Democrats are all acting as if they've suddenly found religion as it applies to spending and debt. Recently, President Obama proposed freezing one-sixth of the federal budget in order to bring government revenues in line with spending.

 

While it's a nice gesture, it's largely symbolic and will be ineffectual since it doesn't address the real problems.

 

We've reached a critical mass where government spending on the military and entitlement programs is literally out of control.

 

Benefits payments are the biggest chunk of the government’s massive obligation, and total defense spending has increased in recent years as the military fights two foreign wars.

 

In addition, the government has added new and prodigious resources for homeland security. The U.S. now spends more on its military than all of the other nations on the planet – combined!

[Guest HUMAN]

Let’s talk/type plain Hard religion in here.

 

The democrats have so indoctrinated the African American Community that the African American Community WILL vote democrat no matter what.

 

The Republican Party "minus me" is Actively after the African American Community for their vote.

 

For I believe that the indoctrination of the African American has been so Successful that there is NO CHANCE for the Republican Party to get the African American vote , no matter what My party does.

 

For the simple truth is that the democrats have a new group to indoctrinate LATINOS, and hence fourth The democrats will throw the African American Community to the wolves, and the African American Community Will still vote democrat.

 

I am as far as I can get from this. I want NO PART OF IT. There is not a chance in heck that I will get in the middle of this one.

 

The Latino Community is central for the economic recovery of this country "Which is true", and I still DO NOT WANT ANY PART OF THIS.

[Guest Kurfco]

Why should the LATINOS, with their relatively high standard of living, get to take all the jobs for minimum wage just because they are close by? I'll bet we could get Somali's or Bangladeshi's or Bolivians if we just did the right recruiting. And then just think how cheap our lettuce could be!

[Guest Kurfco]

If we legalize existing illegal aliens, and they go on to better themselves, it leaves a void in the labor force for more illegal aliens to backfill all the spots in restaurants and fields and car washes. What we need to do is enforce our laws, get aggressive about deportations, spread the word, create fear, and send the signal around the world that we have a front door and we expect it to be used. This will allow wages to rise to attract Americans to perform tasks they currently won't do or will kill off businesses that only exist because shadow workers will do it. Now, if someone wants to argue that the front door is too small or squeaky or admits the wrong people, I am totally open to having the political process sort that out. But, amnesty -- NO WAY, not ever!! We cannot do the 1986 fiasco another time.

[Guest NIA]

Greece Distracting from Real Debt Crisis in U.S.

 

The current sovereign debt crisis in Greece and the potential for euro-zone countries to bailout the nation, has created a rush out of the Euro, which in October became the currency of choice for foreign central banks adding to their reserves. The declining Euro has added fuel to the strengthening U.S. dollar, and the ill-conceived notion that as bad as things are in the U.S., it's worse everywhere else and with the U.S. economy beginning to recover, Europe will be next to experience the financial crisis we experienced in 2008.

 

Unlike the U.S., the nation of Greece doesn't have their own printing press and the ability to create Euros out of thin air, in order to avoid default on their debt. While Greece's debt rating is currently an A2 with a negative outlook, the U.S.'s debt rating remains at AAA, despite the fact that the U.S.'s national debt (including unfunded liabilities) is currently 600% of GDP. If the U.S. was a corporation instead of a nation, its credit rating would be junk.

 

We hope that Greece doesn't get bailed out, because a bailout would cause foreign investors to become more irresponsible than ever and create even greater moral hazards. Unfortunately, not only is it likely that Greece will get bailed out, it's possible our own Federal Reserve will get involved. The U.S. Federal Reserve has the ability to make loans to foreign central banks without disclosure to the U.S. public. European banks have already benefited $50 billion from the U.S.'s bailouts of AIG, so it's not out of the realm of possibility that the Federal Reserve will intervene due to euro-zone countries being key U.S. trading partners.

 

Greece's budget deficit is currently 12.8% of their GDP, only slightly higher than the U.S.'s projected deficit as a percentage of GDP this year of 10.64%. Greece's economy is roughly 1/5 the size of California's economy and while Greece makes up just 3% of the total euro-zone GDP, California makes up 13.5% of the U.S. GDP. If the potential default of Greece is causing a flight from the Euro, imagine what is going to happen to the U.S. dollar later in 2010 if the state of California nears default. Just like Greece, California can't print money on their own.

 

We believe the U.S. dollar will ultimately win a race to the bottom with the Euro, but the only real winners (as far as retaining purchasing power) will be gold and silver. Although precious metals have declined during the recent weeks with a weakening Euro and strengthening U.S. dollar, gold and silver will soon benefit from a complete loss of confidence in western fiat currencies.

 

Many economists are beginning to call the Euro a failed experiment, because of the problems in Greece. A fiat U.S. dollar has only been around for 28 more years than the Euro. Fiat currencies are the root cause of all the economic problems in the U.S. and Europe. NIA believes all fiat currencies will be looked back at as failed experiments.

[Guest x]

The Dollar Bubble starring Peter Schiff, Ron Paul, Marc Faber, Gerald Celente, Jim Rogers, and others. Prepare now for the U.S. dollar collapse.

 

Who owns the FED? The Rothschilds of London and Berlin; Lazard Brothers of Paris; Israel Moses Seif of Italy; Kuhn, Loeb and Warburg of Germany; and Goldman, Sachs and the Rockefeller families of New York.

 

[Guest Eileen McMenamin]

Dr. Alice Rivlin, Co-Chair of the Bipartisan Policy Center’s (BPC) Debt Reduction Task Force, today testified before the U.S. Senate Budget Committee. In her testimony, Dr. Rivlin discussed the dangerous trajectory of the national debt and the need for bipartisan solutions. Dr. Rivlin co-chairs the BPC’s Debt Reduction Task Force with former Senate Budget Committee Chairman and BPC Senior Fellow Pete Domenici (R-NM).

 

“The U.S. budget is on an unsustainable track. There is no disagreement among the Office of Management and Budget (OMB), The Congressional Budget Office (CBO), The Government Accountability Office (GAO), and leading private forecasters on where the budget is headed if we do not change course,” said Dr. Rivlin, former Office of Management and Budget and Congressional Budget Office Director, in her testimony. “Complacency about the fiscal threat is no longer possible. Unfortunately, complacency has been replaced by strident partisan blaming--not yet by a willingness to cooperate on crafting solutions.”

 

“As our debt mounts, the risk grows that our creditors, especially the foreign creditors who own half our debt, will lose confidence in our ability to get our house in order and will demand dramatically higher interest rates to lend us more. Rapidly rising rates would derail the economic recovery and balloon the cost of servicing the federal debt,” Dr. Rivlin stated in her testimony. “Moreover, while there are persuasive economic reasons for curbing the increase in our debt, the moral case is even stronger. It is unconscionable for today’s Americans to live persistently beyond our means and pass our bills on to future taxpayers.”

 

Last month, the BPC launched its Debt Reduction Task Force. The Domenici-Rivlin Task Force is composed of the nation’s leading budget experts, former cabinet officers and elected officials, as well as representatives of the academic, faith, seniors, business, and labor sectors. The Task Force will release its budget plan by year’s end.

 

“Former Senator Pete Domenici and I have recently launched a Bipartisan Debt Reduction Task Force that we hope will demonstrate that Republicans and Democrats can work together to produce a sensible, viable debt reduction plan,” said Dr. Rivlin in her testimony. “We hope to support the efforts of an official Commission, whether statutory or created by executive order, and in any case to make our recommendations available to the public to foster discussion and debate.”

[Guest Human]

All I did was type the truth, nothing more, nothing less.

 

The democrats have raised the debt ceiling by 1.8 or 1.9 trillion dollars, but all of you knew that. So there was really no point in adding that part.

 

Also by "Laws" posts I think the rest of you in here are figuring out that the democrats are pivoting in trying to minimize their loss in the upcoming elections.

 

Which is all that they are doing, but nothing more then that. Since the "Jobs Bill" has already been written by the democrats.

 

If you think that I'm playing politics? NOPE!!!!!!

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If we legalize existing illegal aliens, and they go on to better themselves, it leaves a void in the labor force for more illegal aliens to backfill all the spots in restaurants and fields and car washes. What we need to do is enforce our laws, get aggressive about deportations, spread the word, create fear, and send the signal around the world that we have a front door and we expect it to be used. This will allow wages to rise to attract Americans to perform tasks they currently won't do or will kill off businesses that only exist because shadow workers will do it. Now, if someone wants to argue that the front door is too small or squeaky or admits the wrong people, I am totally open to having the political process sort that out. But, amnesty -- NO WAY, not ever!! We cannot do the 1986 fiasco another time.

[Guest LAW]

What? Either you are playing politics or an obstacle of reason. The bipartisan targeted manufacturing job creation initiative introduced by U.S. Sen. Charles Schumer D-New York and Orrin Hatch, R-Utah, this week in the U.S. Senate, is on track to be voted on by the House of Representative next week and ready for President Obama's signature by March 1.

 

http://hatch.senate....esslayouts=true

 

U.S. Senator Orrin Hatch, R-Utah, unveiled targeted legislation that he believes would be most effective at putting the American people back to work.

 

The bipartisan Hire Now Tax Cut Act of 2010, which is co-sponsored by Sen. Charles Schumer, D-N.Y., would allow any private-sector employer that hires a worker who had been unemployed for at least 60 days to not have to pay the employer's share (6.2 percent) of the Social Security payroll tax on that employee for the remainder of 2010.

 

"This is an affordable, effective and targeted proposal to get the American people back to work," said Hatch. "As a conservative, I appreciate that this proposal isn't about more and more government spending; it's about tax relief to get employers hiring again, which is exactly what millions of unemployed Americans most desperately need."

 

Hatch cites five reasons why the pay-roll tax holiday is the best means of spurring job creation:

• Simple. This proposal is not only easy to explain, but easy to administer – avoiding waste, fraud and abuse.

• Focused. It is exclusively focused on hiring unemployed workers.

• Front-loaded. It provides an incentive for businesses to hire workers earlier in the year.

• Immediate. It puts money into a business to start hiring immediately.

• Affordable. It will cost less than other proposals.

 

Unlike various other tax credit proposals, this payroll tax holiday would immediately impact a business' bottom line – there would be no waiting until 2011 to receive a tax credit. As an additional incentive, for any qualifying worker hired under this initiative that the employer keeps on payroll for a continuous 52 weeks, the employer is eligible for an additional $1,000 tax credit.

 

Workers hired after the date of introduction (Feb. 3, 2010) are eligible for the payroll tax forgiveness and the retention bonus, but only wages paid after the date of enactment receive the exemption from payroll taxes.

A document fully outlining the proposal follows:

 

"HIRE NOW TAX CUT ACT OF 2010"

February 2, 2010

 

BASIC CONCEPT: Starting immediately after enactment, any business that hires a worker that had been without full-time work for at least 60 days prior to employment can avoid paying the employer's share of Social Security taxes on that worker for the duration of 2010. The more a business pays a worker (up to the maximum Social Security wage of $106,800), and the longer a business has a worker on its payroll, the greater the tax benefit – so there is an incentive to hire people sooner, and pay them more.

 

Unlike various tax credit proposals, the benefits under the "Hire Now Tax Cut" go immediately into a business' bottom line – no waiting until 2011 to receive a tax credit. And since the benefit starts immediately after enactment and does not have an arbitrary cap, it will facilitate utilization because some of the past issues with payroll software are avoided.

 

For any qualifying worker hired under this incentive that the employer keeps on payroll for a continuous 52 weeks, that employer is eligible for an additional $1,000 tax credit after the 52-week threshold is reached, to be taken on their 2011 tax return. In order to be eligible, the employee's pay in the second 26-week period must be at least 80 percent of the pay in the first 26-week period. Workers hired after the date of introduction (February 2) are eligible for the payroll tax forgiveness and the retention bonus, but only wages paid after the date of enactment receive the exemption from payroll taxes.

 

EXAMPLES OF TAX SAVINGS:

* Hire a $50,000 worker on March 1, save $2,583.

* Hire an $90,000 worker on April 1, save $4,185.

* Hire a $60,000 worker on May 1, save $2,480.

 

ADDITIONAL FEATURES:

The tax benefit applies only to private-sector employment, including nonprofit organizations – public sector jobs are not eligible for either benefit.

 

Employees who are immediate family members of the employer do not qualify.

There is no minimum weekly number of hours that the new employee must work for the employer to be eligible, and there is no maximum on the dollar amount of payroll taxes per employer that may be forgiven.

 

For workers that would otherwise be eligible for the Work Opportunity Tax Credit, the employer must select one benefit or the other for 2010 – no double-dipping. A worker who replaces another employee who performed the same job for the employer is not eligible for the benefit, unless the prior employee left the job voluntarily or for cause. For the retention bonus to be paid, the worker's wages during the second 26-week period must be at least 80 percent of the wages during the first 26-week period. Lost Social Security Trust Fund revenues will be supplemented by the General Fund.

 

ADVANTAGES/BENEFITS:

• Simple. The idea is easy to explain and administer: "No employer payroll taxes on unemployed workers hired in 2010." Since the proposal is for a complete elimination of the 6.2 percent payroll tax for eligible workers, rather than a fixed or capped dollar amount, employers will know to simply zero out the tax for eligible workers.

• Focused. Given our budgetary constraints and the nagging problem of long-term unemployment, any employment incentive should be focused on the hiring of workers who are currently unemployed. Only by focusing on the unemployed can we get people off the unemployment rolls at an affordable cost to taxpayers. Plus, unlike some versions of a payroll tax holiday, this proposal is not biased towards either low-wage or high-wage workers. Under the plan, a business saves 6.2 percent on both a $40,000 worker and a $90,000 worker.

• Front-Loaded. The proposal provides an incentive for businesses to hire workers earlier in the year, because the tax benefit will be greater. A $60,000 worker hired on March 1 will save a business about $3,100 in taxes, while that same hire delayed until May 1 will save about $2,500.

• Immediate. In the current environment, no business should have to wait until 2011 to receive tax relief for hiring. Our proposal puts money into a business' cash flow immediately, since the tax is simply not collected in the first place.

• Affordable. Because this provision is targeted towards hiring the unemployed, as opposed to providing a tax benefit for any increase in payroll, its cost should be more affordable at a time of record budget deficits.

[Luke_Wilbur]

A tax cut is a start, but it will do hardly anything to jump start the economy. I guess it takes alot of name calling to get the jobs train moving.

[Guest Human]

There it is; Have at it.

 

http://news.yahoo.com/s/ap/20100212/ap_on_bi_ge/us_congress_jobs;_ylt=AgAf3MCSAefxCH2WAlfYFLiyFz4D;_ylu=X3oDMTJobjJrOTQzBGFzc2V0A2FwLzIwMTAwMjEyL3VzX2NvbmdyZXNzX2pvYnMEY3BvcwMyBHBvcwM1BHNlYwN5bl90b3Bfc3RvcnkEc2xrA3NlbmF0ZWRlbXNheA--

[Guest LAW]

A group of Republican Senators led Senator Orrin Hatch (R-Utah), the Chairman of the Senate Republican High-Tech Task Force, today urged President Obama to take steps to strengthen the economy and create much-needed jobs by focusing on tax relief that would spur growth in the hi-tech sector, a powerful engine of job creation.

 

In a letter sent to the President today, the Senators praised the President for proposing to fully extend the research tax credit in his fiscal year (FY) 2011 budget, while also calling for its immediate extension and for improvements that would further encourage economic growth. They also urged the President to abandon tax hikes that threaten America’s international competitiveness, and to move forward with a reduction in the corporate tax rate, which is amongst the highest in the world.

 

The senators wrote, “As we look to execute on our common goal to help our economy grow stronger and create new and better jobs, we believe it is important for your administration to embrace several proposals that will further these goals, particularly in the high-tech sector of our economy. As you know, the high-tech sector has historically been a powerful job creation engine for the U.S. economy attracting capital investment, developing new products which improve our quality of life and providing needed exports that improve our balance of trade deficit with countries around the globe.”

 

Senators Robert Bennett (R-Utah), Jim Bunning (R-Kentucky), John Cornyn (R-Texas), Mike Crapo (R-Idaho), Mike Enzi (R-Wyoming), Kay Bailey Hutchison (R-Texas), Johnny Isaakson (R-Georgia), James Risch (R-Idaho), Pat Roberts (R-Kansas), joined Hatch in sending the letter to President Obama.

 

Below is the full letter to the President:

 

The President

The White House

Washington, DC 20500

 

Dear Mr. President:

 

As we look to execute on our common goal to help our economy grow stronger and create new and better jobs, we believe it is important for your administration to embrace several proposals that will further these goals, particularly in the high-tech sector of our economy. As you know, the high-tech sector has historically been a powerful job creation engine for the U.S. economy attracting capital investment, developing new products which improve our quality of life and providing needed exports that improve our balance of trade deficit with countries around the globe.

 

We are very concerned that the research tax credit has expired, leaving the U.S. without a tax incentive to counter the ever-growing array of attractive research inducements offered by many of our trading partners. We realize that your budget calls for a permanent extension of the credit, for which we commend you. However, we believe that in order to gain the full effect of the incentive and to keep the U.S. as the premiere location for research in the world, we must improve the credit as well as extend it. A recent report has estimated that an expansion of the credit as proposed in bipartisan legislation in the Senate and House would lead to an additional $90 billion in annual GDP, a significant increase in patents generated by American inventors, and would generate additional revenues for the Treasury through economic growth. We urge you to help us enact a strong research incentive to keep us first in the world by endorsing the strengthening of the credit as well as its extension.

 

We also are deeply concerned that your new budget again includes certain tax increases on America’s most innovative companies doing business overseas. We recognize that some of the more onerous international tax proposals contained in last year’s budget have been wisely omitted this year and other ones have been moderated. However, we still believe that the thrust of your proposals to reform the U.S. international tax system are driven by a misguided sense that U.S.-based firms are abusing the tax rules by effectively moving U.S. jobs and investment to foreign locations. In reality, U.S. firms compete on a global scale, and our current worldwide system of taxation often leaves our companies at a serious disadvantage to those based in other nations. The tax proposals in your budget would even further tilt the playing field away from U.S. competitiveness. We urge you to abandon these proposals and join us in moving in the other direction by lowering our corporate tax rates, which are among the world’s highest, and making other changes that would make our international tax system more competitive, not less.

 

We look forward to working with you on these critical issues, and hope you will join us in our quest to keep our high-tech sector the most vibrant and innovative in the world, which will in turn bless our nation with more economic growth and more and better jobs.

 

Sincerely,

Orrin G. Hatch

Robert F. Bennett

Jim Bunning

John Cornyn

Mike Crapo

Mike Enzi

Kay Bailey Hutchison

Johnny Isakson

JimRisch

Pat Roberts

 

cc: Senate Majority Leader Harry Reid

Senate Minority Leader Mitch McConnell

Senate Finance Committee Chairman Max Baucus

Senate Finance Committee Ranking Member Chuck Grassley

[Guest LAW]

Briefing by White House Press Secretary Robert Gibbs, 2/16/10

James S. Brady Press Briefing Room

 

1:12 P.M. EST

 

Q Switching topics, then, to the stimulus, the Recovery Act. Tomorrow is the anniversary, I believe. What is the number of jobs now that the administration believes were created or saved -- what is the phrase, and how are you counting them now?

 

MR. GIBBS: Let me get you the CEA report that I think says 1.5 [million] to 2 million. And I can also send you the Congressional Budget Office, a nonpartisan -- I think their number -- I don’t have it handy -- I think was something like 1.6 [million] to 2.4 [million]. As you know there’s a Web site for recipient statistics for a portion of --

 

Q But the numbers are -- that's really my point, that the numbers are so all over the map.

 

MR. GIBBS: No, 1.5 [million] to 2 [million] and 1.6 [million] and 2.4 [million] I think are very much in the same ballpark.

 

Q -- like counting jobs is they differ by a half a million.

 

MR. GIBBS: Well, again, Chip, you should call Doug Elmendorf over at the Congressional Budget Office, who I think --

 

Q -- I'm just trying to get from you what is the --

 

MR. GIBBS: Well, what did he say?

 

Q Everybody quotes all these different numbers that are all over the map.

 

MR. GIBBS: Well, again, I'm not an economist. I don't know the theory that the Congressional Budget Office, which has scored pieces of legislation that we consider that gives those budgetary and policy impact scores -- I would point you to the report that says that's how many jobs were created.

 

But, look, I think -- understand, look at the recipient reports. Again, the recipient reports that I think are online cover a portion of the Recovery Act, but we've seen hundreds of thousands of teachers that, as a result of pretty drastic cutbacks in state and local government funding, would have required teachers to be laid off. Class sizes would have rose -- would have risen. Schools would have likely been closed as a result of those harmful budget cuts. That's why the Recovery Act has a significant amount of state and local assistance to ensure that police and firefighters and teachers and the like are not laid off.

 

Q The reason I'm asking this is because in CBS/New York Times' recent poll, one number just leaps out at you, and it's -- when you ask people, has the Recovery Act created jobs, 6 percent say yes. So either they are just massively confused by all these numbers, or they just -- you've just done a bad job of selling this and convincing people. Why do you think -- I mean, 6 percent is --

 

MR. GIBBS: Well, Chip --

 

Q -- so close to zero it's almost --

 

MR. GIBBS: Or it could be plus or minus 6 percent, building off your previous example. I mean, that's on a magnitude of 6, Chip, if you were to take --

 

Q Six percent is incredible. Why do you think it's so small, and is it because the administration has done that bad a job of selling it?

 

MR. GIBBS: I think we're living in an environment where the unemployment rate is 9.7 percent. I think we're living in an environment where 8.4 million people since December of 2007 have lost their job.

 

Chip, let me give you the answer the President would give when he's asked about his approval ratings in an economy with 9.7 unemployment. I'm sure it's very true, when you call somebody who lives in Elkhart, Indiana, whose unemployment rate has come down in the last year but is still probably 13 or 14 percent or close to 15 percent -- an entire industry -- motor homes -- has decimated -- you live in Elkhart, you just lost your job, your wife just lost her job, you're having trouble figuring out how you're going to pay for your kids' college, and somebody says, "How's the Recovery Act working?" I mean, you know --

 

Q Well, has it created any jobs, is the question. It's still a pretty --

 

MR. GIBBS: Again, every economist says the answer to that is yes. The problem, Chip, is, as I said before and as we've talked about, 8.4 million people since December 2007 have lost their jobs. The frustration of economic anxiety didn't start in December of 2007. It started -- it's been going back 10 years where people have seen their wages decline, people have worked longer and harder, they've seen their productivity rise, yet the money in their pocket doesn't rise at the end of every week when they cash their paycheck.

 

Home values have plummeted and continue to have a hard time sustaining their value. We have gone through an economic trauma unlike anything that we've seen in this country since the last 1920s. I think that's a significant number.