US Aid to Israel Must Stop

Israel is a relatively tiny place, a country whose entire population of 7.5 million people is less than the number of people that live in New York City.

Since its formation in 1948, Israel has become a robust democracy and now boasts one of the highest per capita GDP's in the world ($26,800).

Given its highly-developed status, why does the US continue to provide it with annual aid in the billions of dollars?

The US has been its chief benefactor, providing Israel with upwards of $104 billion of aid since its formation, and in 2010 alone, is scheduled to give it almost $2.8 billion.

However, news today indicating that Israeli commandos stormed an aid flotilla, killing 10 people in the process, is enough of a prompting to cause the US to rethink its continued financial support of Israel.

Israel assuredly does not need US taxpayer money in order to survive as a country. Its annual stipend is an expensive symbolic gesture, meant to demonstrate to the world the support and commitment that the US has for Israel.

Removing Israel from the trough of US taxpayer dollars would force it to try harder to coexist with its Arab neighbors, and to come up with a good-faith, sensible plan to share its land with the Palestinians.

Why Does The US Military Still Have Bases in Japan?

Recent reports indicate that President Obama and Japan's Prime Minister are holding discussions about relocating the US base situated on the Japanese island of Okinawa.

"The White House says President Barack Obama and Japanese prime minister have expressed satisfaction with plans to move a U.S. Marine base to a less crowded part of the Japanese island of Okinawa.

Details of their conversation came as Washington and Tokyo issued a joint statement outlining a new agreement on keeping the base on the island of Okinawa. Hatoyama's decision disappointed many of the island's residents, who complain about base-related noise, pollution and crime."

The article discusses some concerns that certain Japanese have with the US retaining a base on the island. However, there is no discussion of any possible misgivings that Americans might have to operating an overseas military base in this day and age.

An American taxpayer might ask: why does the US need to maintain a military base in Japan (or anywhere in Europe for that matter), more than a half a century after the second world war concluded? The cost is prohibitive, and given the sky-high deficits and monstrous public debt we face as a country, surely the taxes used to fund this and other bases are better off being used to retire our public debt, or better yet, not even be collected in the first place.

The annual funding required by the American military is astronomical - reports have it totaling at least $700 billion per year. And that does not include the cost of state reserve units, that are often co-opted to fight overseas wars on behalf of the federal government.

Is anyone in the federal government capable of rethinking America's priorities, and to stop mindlessly continuing whatever policies were put in place in prior years?

Let's bring the troops home, and make the annual cost of our military a small fraction of what it is today.

Hillary Clinton: We Should Be More Like Brazil!

In a speech given to the uber-liberal Brookings Institution, Secretary of State Hillary Clinton declared that the rich in America don't pay their "fair share" of taxes.

Of course, she made no mention of what constitutes a "fair share", as she likely believes it is sufficient for her to simply point out their shortcomings in general now, and she'll figure out the appropriate tax rate when she becomes President.

She also mentioned that the US should look to, of all countries, Brazil as an example of a country that is being taxed to death, and yet still manages to grow.

"Brazil has the highest tax-to-GDP rate in the Western Hemisphere and guess what — they're growing like crazy," Clinton said. "And the rich are getting richer, but they're pulling people out of poverty."

Yes, the Brazil that is affectionately known as "the country of the future...and always will be!" is now apparently what the greatest country on earth should model itself after.

Clinton unsurprisingly does not point out that Brazil's growth is largely coming from mining vast quantities of iron ore and selling it to the China.

Is she perhaps signaling a newfound admiration and support for US mining companies, and will work to ensure their continued worldwide competitiveness (just like the Brazilian government)? That is unlikely.

What she reveals herself to be time and time again is an opportunistic politician that wants to be able to use more and more of the private property of Americans for her own statist, redistributionist agenda.

Senator Kerry: Tea Partiers are Hypocrites

In a nonesensical statement by a man who has made a career out of the same, Senator John Kerry (D-MA) recently remarked that Americans that are angry at Washington are being hypocritical.

"But he said that the D.C.-directed attacks are hypocritical, since many of those attacking Washington spending presumably want to keep their Social Security and Medicare and want Washington to play a big role in the Gulf Oil cleanup. "There's a huge contradiction on a daily basis," he said."

So because Tea Partiers believe that politicians in Washington are overspending in a multitude of areas, it's hypocritical for some of them to support any type of spending that is undertaken from Washington?

I think the essential issue here is that Mr. Kerry does not understand the Tea Party, does not understand why it has sprung into existence and does not understand the issues that its supporters believe are important.

Many Tea Partiers (myself included) would support making Social Security and Medicare contributions voluntary and not mandatory (of course, that would mean we were not able to receive those benefits either, to the extent we did not "contribute"). Any many Tea Partiers believe that regulators in Washington or at the state level in Louisiana should oversee the clean-up efforts being undertaken by BP (which at least has access to cutting edge technology, and is not bogged down in red tape like government bureaucrats would be) but not play a "big role" (which in his definition presumably means taking over the clean-up process).

The fact is, Senator Kerry and the Democrats ignore and mock the Tea Party at their own peril, and risk a devastating defeat in November.

As for why the Tea Party has just now come to life, it was one thing for the overspending to be approved by previous Administrations (i.e., Reagan, Bush 2) that were pro-growth and kept taxes somewhat low, which created the hope that once we got spending under control we could grow our way out of the mess. It's quite another for the Obama Administration to overspend, have no pro-growth policies and talk of massive tax hikes (e.g., repeal of Bush tax cuts, European-style VAT, etc.) as a means to fulfill their statist agenda.

CA Budget Mess a Harbinger of Future Federal Issues

The massive budget deficit that the state of California currently faces should seemingly be an opportunity for lawmakers in the Golden State to finally face up to the fact that, at some point, chronic overspending needs to be reigned in.

Unfortunately, that's not the way things work in the world that politicians live in.

Consider Democratic lawmakers proposal to "solve" the state's $19 billion budget deficit, which counters the budget cuts that Governor Schwarzenegger had proposed.

"Assembly Democrats weighed in Tuesday with their own state budget plan that relies on borrowing nearly $9 billion from Wall Street and installing a new tax on oil production to pay back that loan over 20 years."

The $9 billion loan from "Wall Street" is basically securitized by the nickels and dimes that roll in over the next 20 years from the state's bottle recycling tax.

And I wonder how much additional tax revenue that new tax on oil production will actually bring in, once producers factor in the new cost into their estimates and decide that, "hey, maybe we should tap those oil rights we have in Texas or Oklahoma instead of bringing anything new on-line in California."

This sort of fiscal recklessness is foreboding for what Democrats in national office will do when it ultimately becomes clear that printing money is not the panacea for exploding budget deficits.

One can only imagine that instead of ultimately trimming costs as they by all rights should do, perhaps Congress will ultimately decide to securitize future gate receipts at the Smithsonian or sell burial plots at the Arlington National Cemetery.

We're a long ways away from lawmakers and their supporters in this country actually facing up to the destructive fiscal policies that they embrace.

Sarah Palin: Feds Should Be More Involved in the Gulf Clean-Up?!?

Still-not-ready-for-prime-time former Alaska Governor Sarah Palin recently lashed out at President Obama for his lack of immediate appreciation of the effect and impact of BP's oil spill in the Gulf of Mexico.

"Pointing to what she termed the White House's relationship with "the oil companies who have so supported President Obama in his campaign and are supportive of him now," Palin questioned whether "there's any connection there to President Obama taking so doggone long to get in there, to dive in there, and grasp the complexity and the potential tragedy that we are seeing here in the Gulf of Mexico."

Uhhhhhh, Sarah, as the nominal head of the Tea Party (although hopefully not for long), you are not supposed to be advocating for increased federal involvement in these types of things.

The fact is, BP has (rightfully) committed to paying billions of dollars out of its own pocket to remedy the damage done by the spill, and is currently acting on that commitment.

We should be happy that the federal government hasn't tried (to date) to take over the clean-up efforts, as doing so would likely quadruple the current estimated costs and make an even bigger mess of what already exists.

Having President Obama fly down to New Orleans to bloviate about the spill would not have actually accomplished anything, and we should be thankful he hasn't done that yet.

Ms. Palin should quickly recognize that what people who support the Tea Party want out of government is not more political posturing and grandstanding, but rather for government to get out of the way and let people and private enterprise mingle, contract and co-exist with minimal intervention. Demanding that President Obama get down to the Gulf and meddle in the clean-up efforts does not further that agenda.

The Rand Paul Non-Story

Rand Paul's (R-KY) victory in the Senate primary last week is a testament to the people in Kentucky who showed themselves willing to take a chance on a relative newcomer to politics, a man who made many promises about ending the way business is currently done in Washington.

However, there is no ignoring the fact that Paul is now a marked man to the mainstream media and those in power in Washington.

To wit, in a post-election interview on MSNBC, interviewer Rachel Maddow employed a bit of "gotcha" journalism in fishing on-camera for Paul's views on the 1964 Civil Right Act legislation.

In a very refreshing bit of candor, Paul suggested that the Act had possibly outlived its usefulness, and in securing rights for one party (African Americans) had potentially ridden roughshod over the rights of others (property-owning Americans).

"Does the owner of the restaurant own his restaurant? Or does the government own his restaurant?" Paul remarked during his interview with Maddow. He went on to say that, had he been in office when the Civil Rights Act came under debate, he would have tried to change it because it undermines the first amendment rights of property owners. He also compared the federal government ordering business owners not to racially discriminate to the government telling business owners not to refuse service to patrons armed with guns."

It is certainly arguable that the Civil Rights Act was necessary back in 1964. However, have people changed, have the opportunities for those who wish to show their disdain against those who seek to discriminate been significantly multiplied since 1964 with the advent of the internet?

In today's world, the racists among us (whether individuals, whole cities or even states) would be subjected to economic boycotts and public scorn from the rest of us, and their policies and goals would be justly vilified until they were reversed, without the need for any state intervention.

Apparently, those on the Left are still stuck in 1960's and believe that not only should business-owners be hauled off to jail for failing to promptly serve a cheeseburger, but anyone who even remotely questions the wisdom of that kind of thinking should be publicly drawn and quartered.

Much to their surprise I'm sure, the views of Rand Paul much better fit the views of most Americans than Rachel Maddow and those of similar ilk on the Left.

America can not be turned around until more people like Rand Paul are elected to public office. We need more legislators like Mr. Paul, people that believe that ordinary, hard-working, entrepreneurial Americans are what make this country great, and who actively strive to make Big Government a much less intrusive presence in people's lives.

Let's hope and pray that the people of Kentucky don't fall for the demonization of Rand Paul and give him a resounding win in November, a win that would rally and encourage freedom-loving Americans.

BCS Head Stands Up to the US Senate

In a time when members of Congress think they should weigh in on any contemporary issue that interests them (instead of, you know, focusing on their Constitutionally-mandated responsibilities), it's refreshing to hear of a person in a position of national renown in effect publicly and plainly telling them to spend their time on other issues, rather than pliantly responding to their missives like most would.

Sens. Orrin Hatch (R-UT), and Max Baucus (D-MT) started the exchange recently when they sent a letter to the BCS.

"Their letter, which was posted on Hatch’s official Web site, asks for details about how the BCS calculates which conferences get automatic bowl bids, how money will be divvied up under a new TV deal and what sort of legal status the organization has."

BCS executive director Bill Hancock responded as follows:

“I’m looking forward to taking a longer look at the letter. I sure do think that Congress has more important things to do, with all the issues facing our country,” Hancock said in a telephone interview with The Associated Press. “The BCS is fair. Access is fair. Revenue is distributed fairly. And frankly, we welcome the opportunity to tell our story every chance we get.”

I couldn't agree more with Hancock.

Perhaps if Messrs' Hatch and Baucus would spend more time thinking about ways to reduce our budget deficit and less time worrying about whether certain colleges can compete for the college football championship game, we wouldn't be in quite the financial pickle we find ourselves as a country today.

NJ Governor Christie Impresses Again

New Jersey Republican Governor Chris Christie once again demonstrated excellent fiscal sanity, by rejecting a "millionaires tax" that had been proposed by New Jersey lawmakers.

The vote came within minutes of the Democratic Assembly passing a bill that they projected would raise over $500m, but be immediately spent on various items.

"The Assembly voted 46-32 to pass a bill that would raise taxes on income over $1 million to pay for property tax rebates and prescription drug benefits for seniors and the disabled."

Christie's response while vetoing the bill was priceless:

"While I have little doubt that the sponsors and supporters of this bill sincerely believe that the state can tax its way out of this financial crisis, I believe that this bill does nothing more than repeat the failed, irresponsible and unsustainable fiscal policies of the past," wrote Christie in his veto statement. "Now is not the time for more of the same. Ultimately, another tax increase will punish the state’s struggling small businesses and set our economy further back from recovery."

Why are there so few Chris Christie's (i.e., elected men and women with some fiscal sense and a backbone) in statewide and national office around the country?

Every state needs a Chris Christie running it, to stand up to special interest unions, corporations and citizens demanding more and more handouts and sweetheart deals from government.

Taxpayer Bailout of State Pension Plans?

A recent CNN/Money article suggests that state pension plans will need a bailout from the federal government in the coming years.

"This is a problem of monumental proportion," said Rauh, an assistant professor of finance at the Kellogg School of Management. "Given that we see the same issue in many states, the total size of a federal rescue plan could exceed the seriousness of the recent economic crisis and potentially cost more than $1 trillion total."

Let's see if I have this right. States are either unable or unwilling to raise enough taxes from their own residents to make their pension plans solvent. So, instead, they may want the federal government to tax those same people, and then transfer the money back to the states?

Huh?

Here's a better idea. How about the states that have massive pension shortfalls simply reduce the defined benefits that have been promised to state workers to a degree that the pension plans are, voila, no longer insolvent?

Annual compensation (i.e., salaries and benefits) for workers at the federal and state level are already significantly higher than pay for workers doing similar jobs within the private sector.

Simply put, there is simply no plausible reason that the fatcats working for government should be bailed out at the expense of the rest of us.

Taxpayer-funded Higher Education

In a familiar rite of spring, colleges across the country are waving farewell to recent graduates, as the young lads and lasses march off to the workforce to put their shiny new degrees to work.

Well, at least that's the way things used to work.

With the economy still in the doldrums, significant amounts of college graduates have not found a job, and their prospects for finding a job look pretty bleak.

Which brings us to the main point: government subsidies of higher education.

The White House touts the government's efforts in making college more "affordable": Pell grants, support of community colleges, loan forgiveness programs and most importantly, direct subsidized loans for students to attend college.

Of course, it's good for a country to have a well-educated populace. But an education can be gained in many different forms. Should that education be funded at taxpayer expense, while basically expecting the recipient to sit for four years in a cushy environment living a bohemian lifestyle?

More and more students are discovering that government subsidies only increase the cost of college, as colleges simply increase tuition and fees to capture the money coming in from the government to pay for it. This ultimately leaves students in worse financial predicament after graduating than they'd be without the subsidies, when factoring in the significant debt they are saddled with in order to pay for that education.

Far better for the government to end all of its college subsidies, which would have the effect of encouraging students to pursue much more cost-effective educational programs, like distance-learning or internet-based studies, that enables them to work part-time while studying, therefore avoiding significant student debts that need to be reckoned with after graduation.

Anti-Incumbent Fever Spreading

Yesterday's primary win for Senate candidate Rand Paul in Kentucky, Arlen Specter's defeat in the Pennsylvania Senate primary and Bob Bennett's recent defeat in the Utah Republican primary all signal the same thing - voters are tired of politicians in Washington foolishly spending their money.

Rand Paul's victory is a 'feather in the cap' for the Tea Party and their efforts in propelling him to this win, particularly since his primary opponent was backed by Republican heavyweights:

"Paul's victory represented a defeat for Kentucky's Republican hierarchy, which solidly backed Grayson. Powerful Kentucky senior senator and Senate Minority Leader Mitch McConnell put his weight behind Grayson as did former Vice President Dick Cheney , who called Grayson the real conservative in the race."

A post-election statement made by Robert Menendez, head of the Democratic Senatorial Campaign Committee, should give Rand Paul and Tea Party folks some additional cheer, as Menendez has now gone on record in saying that he believes Paul is actually better for Democrats to face in the general election.

"Rand Paul would abolish the Department of Education, would disband the Federal Reserve, and would end farm subsidies for Kentucky's farmers," Menendez said in a statement. "Rand Paul may love the national media spotlight but he has shown no interest in growing Kentucky's economy or creating new jobs."

Robert Menendez has shown how empty and meaningless Democratic rhetoric is. In effect, because Rand Paul is opposed to excessive taxes and excessive interference by politicians in our lives and in the economy, this should somehow be interpreted as him having no interest in growing the economy or creating new jobs?

With talk like this helping people increasingly take notice that the entrenched political class is nothing more than a bunch of lying, stealing empty suits, I'm increasingly optimistic that shills like Menendez and the people he supports will be out of office in November.

Taxpayer Losses Roll In From the Bailout

The US Government is beginning to acknowledge what most people have known for the past year - the 2009 bailouts were the equivalent of flushing money down the toilet.

"The Treasury Department said Monday it will lose $1.6 billion on a loan made to Chrysler in early 2009. Taxpayer losses from bailing out Chrysler and General Motors are expected to rise as high as $34 billion, congressional auditors have said.

Treasury said Monday that Chrysler repaid $1.9 billion of a $4 billion loan, which was extended before the company filed for Chapter 11. The government hopes to get another $500 million from the company that emerged from bankruptcy, Chrysler Group LLC."

The 2009 bailouts of Chrysler and GM were always about protecting union jobs, union contracts and union benefits. Nothing more, nothing less.

Making below-market loans to loss-making companies with astronomical labor costs and that have made little effort to reign those same costs was never a sound idea, and had failure written all over it from the beginning.

Unfortunately the loss reported here is nothing compared to what taxpayers will see from the amounts extended to Fannie Mae, Freddie Mac and the rest.

This titanic waste of taxpayer money is yet another in the long list of reasons that the politicians that voted for the 2009 federal bailouts, Democrat or Republican, should be tossed out of office as soon as they stand for reelection.

What's With The Recent Calls for Global Taxes?

Add the World Health Organization to the list of international bodies that wants to directly impose taxes on countries around the world.

"The World Health Organization (WHO), the United Nations' public health arm, is moving full speed ahead with a controversial plan to impose global consumer taxes on such things as Internet activity and everyday financial transactions like paying bills online — while its spending soars and its own financial house is in disarray.

The aim of its taxing plans is to raise "tens of billions" of dollars for WHO that would be used to radically reorganize the research, development, production and distribution of medicines around the world, with greater emphasis on drugs for communicable diseases in poor countries."

This comes on the heels of recent calls for an international bank tax (proposed by the IMF) as a slush fund to be used to clean-up future financial excesses, as well as a tax on international air travel (a United Nations proposal), to be used to combat "climate change."

Apparently these international bodies aren't content with being funded by countries with whatever funds are leftover after domestic priorities are addressed; no, they'd rather impose taxes directly to ensure there own sources of revenue.

Fortunately, none of the proposals have generated much traction in the United States. If politicians here think raising taxes in general to pay for more warfare, bailouts and welfare will be controversial and would endanger their reelection chances (as slight as the chances of them returning to Washington after November might be), they know they might as well start packing their bags now if they support raising taxes on Americans to pay even more to already overfunded, unaccountable international bodies.

Massive Tax Cheating By US Companies?

By asserting in the title line in his Bloomberg article yesterday that US companies are "dodging" $60 billion in US taxes through the use of transfer pricing, Jesse Drucker apparently thinks so.

In fairness however, he does later on refer to the tax move he objects to as being "legal", but the gist and tone of the article ultimately belies that concession.

"Transfer pricing lets companies such as Forest, Oracle Corp, Eli Lilly & Co. and Pfizer Inc. legally avoid some income taxes by converting sales in one country to profits in another -- on paper only, and often in places where they have few employees or actual sales.

Let's be clear. Mr. Drucker provides no evidence and does not even argue that the focus of his article, Forest Laboratories, has in fact cheated on or falsified any of its required US tax filings.

The fact that the US IRS has not chosen to take Forest Laboratories to court in order to fight their transfer pricing practices speaks loudly to the idea that they are doing nothing illegal or shady.

Mr. Drucker's primary objection is simply that the US corporate tax system in effect encourages US corporations to establish Intellectual Property holding companies outside the US, and use those same entities to sell branded products back into the US.

The profits earned by the offshore subsidiaries will be subject to US tax when the profits are ultimately sent back to the parent company. In order to avoid that day of reckoning, US multinationals typically reinvest the profits offshore.

Perhaps Mr. Drucker would be happier if the US employed a "territorial" tax system (as opposed to its current "deferral" system). However, a territorial tax system, which is used by the vast majority of industrialized nations, basically exempts most income generated by offshore subsidiaries from ever being subjected to tax by the home country.

In a deferral tax system, which the US and a few other tax-hungry nations still use, offshore profits are in fact ultimately subjected to tax in the home country, albeit on a deferral basis until the underlying profits are sent back for reinvestment in the home country or for dividend payments made to shareholders.

The best course of action here is to avoid scapegoating US companies, who are already saddled with some of the highest tax rates in the world. If the Jesse Drucker's of the world want to encourage US companies to increase their investment in the US, they should think in terms of reducing US tax rates (down to say Ireland's level), rather than subjecting their non-US earnings to tax in the US.

Lastly, a manufactured scandal wouldn't be complete without a left-leaning politician attempting to pile on:

“Transfer pricing is the corporate equivalent of the secret offshore accounts of individual tax dodgers,” said Sen. Carl Levin, a Michigan Democrat and chairman of the Senate’s Permanent Subcommittee on Investigations, in a statement to Bloomberg News. Levin has overseen hearings on tax shelters including those sold to wealthy people by KPMG LLP. “Now that progress has been made in addressing offshore tax abuse by individuals, transfer pricing is an issue that deserves scrutiny.”

It might be time to think about hanging it up, Carl. Despite your illogical contention, there's simply no comparison between US individuals who hide money offshore and report neither the money nor their accounts as they are required to do, and US companies that attempt to navigate the US transfer pricing rules (written by you and your cohorts in Congress, as well as the IRS!) as best they can and report all accounts and profits to the full satisfaction of the IRS.

The Illogical and Misguided War on Independent Contractors

It is well understood to be a fundamental right that when two parties come together, with one person asking the other person to perform lawful services in exchange for payment, the two should be free to decide among themselves how that arrangement is structured, right?

Not so fast.

The Obama Administration believes that depending on the level of oversight, among other items, exercised by the person who will make payment, the person being paid MUST be treated as an employee for federal tax purposes.

President Obama's proposed 2011 budget suggests tough times ahead for employers who rely heavily on independent contractors in order to keep down labor costs.

If the budget is approved, the IRS will add 100 new enforcement personnel as part of a $25 million plan to crack down the misclassification of workers as independent contractors."

The reasons for the heightened attention of the federales on this issue are not altruistic. Forcing these arrangements to be treated as employer/employee can result in much more tax revenue pouring into Washington DC.

"In 2000, Microsoft had to hand over nearly $100 million in taxes, missed payments, and penalties."

This very issue is what drove Joseph Stack over the edge when he crashed his Cessna into the IRS' offices in Austin, Texas a couple of months ago.

This is yet another example of an over-arching federal government attempting to dictate to Americans how to conduct business. The fact that the Obama Administration is heavily populated with people who have never actually run a business makes this incredibly ironic but no less frustrating and troubling.

At a time when employers are reluctant to add more headcount due to cost concerns, adding this issue as another reason not to bring in more labor is nonsensical.

US Government Continues to Overspend

Reports today indicate that the federal budget deficit in April was the highest ever for the month, and demonstrate that clueless politicians in Washington DC continue to have no idea how to get the federal budget under control.

"The United States posted an $82.69 billion deficit in April, nearly four times the $20.91 billion shortfall registered in April 2009 and the largest on record for that month, the Treasury Department said on Wednesday.

It was more than twice the $40-billion deficit that Wall Street economists surveyed by Reuters had forecast and was striking since April marks the filing deadline for individual income taxes that are the main source of government revenue.

Department officials said that in prior years, there was a surplus during April in 43 out of the past 56 years."

What's it going to take to have our elected officials show some backbone and reduce spending so that all of this borrowing ceases?

It's absolutely ridiculous to continue borrowing money at this point, which will have to be paid back by future generations, only to spend it on frivolous federal programs.

Hopefully the American populace is paying attention and will take appropriate action at the Senate and House level in November by voting for candidates that promise to reduce spending in Washington.

Gold Price Should Be A Wake-up Call for Politicians Everywhere

The recent surge in the price of gold to an all-time high should serve as a wake-up call to politicians across the globe to the fact that their fiscal policies are destroying their currencies.

"Concerns about the European debt crisis, which have kept markets seesawing since the Dow's near 1,000-point drop last Thursday, have amplified uncertainties about a global economic recovery. In turn, that has boosted the appeal of tangible commodities over paper currencies or equities, which are seen as higher risk, analysts said."

Gold has appreciated almost 500% against the U.S. dollar over the past 10 years, as concerns about spiraling budget deficits, unfunded future entitlement benefits and the size of the public debt have fueled future inflation concerns, thus propelling the gold price.

Analysts agree:

"Safe-haven demand has been boosting gold prices, according to James Moore, analyst at TheBullionDesk.com.

"The sheer scale of fiscal deficits facing numerous countries is likely to prompt further diversification from fiat currencies and should ultimately propel gold to fresh highs," Moore wrote in a note."

Politicians should take the lesson of the skyrocketing gold price to heart: eliminate budget deficits by slashing public spending, before their currencies are subjected to a Weimar or Zimbabwe-like fate.

Let The Public Employee Furloughs Begin

In a move that will be increasingly common across the country in the coming years, New York state legislators approved a furlough affecting 100,000 New York public employees.

"Legislators on Monday night reluctantly approved furloughing 100,000 state workers for the first time in New York history.

The unprecedented move forcing employees to take one unpaid day off per week came after Governor Patterson threatened to shut down state government."

The measure being taken by New York State was largely avoidable. If public sector employee had been willing to reduce their already incredibly lavish pay and benefits across the board by as a little as 10%, furloughs would have been unnecessary.

Of course, agreeing to such concessions would go against the bull-headed nature of public sector unions.

In time however, for states like New York, California and New Jersey that have nightmare fiscal deficits , furloughs will ultimately prove to be insufficient and mass layoffs of public employees and slashing of promised pension benefits will be required in order to get state budgets in line with tax receipts.

For taxpayers that are sick and tired of funding lavish retirements of public employees (good luck to anyone who think they can get these types of retirement benefits in the private sector), this type of fiscal reckoning can't come soon enough.

Defense Secretary Admits Wasting Taxpayer Money

In making a rare admission that a department of the federal government is squandering taxpayer money, Defense Secretary Robert Gates said on Saturday than Pentagon officials will seek to cut overhead costs.

"The Pentagon must hold down its spending and make choices that will anger "powerful people" in an era of economic strain, Defense Secretary Robert Gates said in a weekend speech in Kansas.

Increasing health care costs, a top-heavy uniformed and civilian management force, and big-ticket weapons systems are swelling the military's budget at an "unsustainable" rate, Gates said. In response, Gates said, he has ordered the Defense Department's military and civilian leaders to find savings of 2 to 3 percent -- more than $10 billion of the Pentagon's roughly $550 billion base budget -- and shift spending toward war-fighting costs."

Given the US military is thought to have a fixed presence in 135 countries around the world, there's no reason that we can't take Mr. Gates one step further and slash 50% of its budget in an effort to return it to its true roots of defending the United States from foreign aggression.

Putting America's military overseas in so many countries stirs up foreign distrust of the United States (who see the US military presence as unwanted intervention in their affairs), wastes taxpayer money, strays from the Constitutional mandate of using the military to protect our own borders and probably ends up inadvertently propping up more dictatorships overseas than it does in attaining its hoped-for goal of spreading freedom.

Amnesty that Pays for Itself?!

Senators Charles Schumer (D-NY) and Lindsey Graham (R-SC) have emerged with a plan to address the illegal immigration issue that is currently at the forefront of public debate.

"Americans overwhelmingly oppose illegal immigration and support legal immigration. Throughout our history, immigrants have contributed to making this country more vibrant and economically dynamic. Once it is clear that in 20 years our nation will not again confront the specter of another 11 million people coming here illegally, Americans will embrace more welcoming immigration policies.

Our plan has four pillars: requiring biometric Social Security cards to ensure that illegal workers cannot get jobs; fulfilling and strengthening our commitments on border security and interior enforcement; creating a process for admitting temporary workers; and implementing a tough but fair path to legalization for those already here."

Most Americans can probably get on board with the first three "pillars".

It's the last one that most Americans would object to. Giving full citizenship to illegal aliens, who by definition broke existing immigration laws to come to America, would set a horrible precedent and would give a meaningful reward to those who have committed illegal acts.

The "price" that Senators Schumer and Graham suggest that illegal immigrants should pay for full citizenship is ripe for cheating and non-compliance.

"For the 11 million immigrants already in this country illegally, we would provide a tough but fair path forward. They would be required to admit they broke the law and to pay their debt to society by performing community service and paying fines and back taxes. These people would be required to pass background checks and be proficient in English before going to the back of the line of prospective immigrants to earn the opportunity to work toward lawful permanent residence."

The Center for Immigration Studies has done an outstanding job discussing why it would be a challenge to collect even a smidgen of the back taxes the illegal immigrants owe.

Giving full citizenship to 11 million illegal immigrants should not simply be an economic bargain in which the price to be paid is in effect whatever the illegal immigrants say it should be.

Consequently, this is yet another bill in Congress that should not and hopefully will not ever be passed.

US Government Gives $656m to Pakistan?

At a time when US budget deficits are out of control, why is the American government taxing Americans in order to transfer over a half a billion dollars to Pakistan?

"The United States has released $656 million to Pakistan for some of the costs incurred last year in military operations against Taliban militants, a U.S. embassy spokesman said on Tuesday.

The funds are part of a program called the coalition support fund (CSF), a U.S. program used to reimburse countries that have incurred costs in supporting counter-terrorist and counter-insurgency operations.

Pakistan, a vital ally for the United States as it struggles to stabilize Afghanistan and end the global threat posed by al Qaeda and its allies, has been heavily burdened by the cost of battling Taliban insurgents along its Afghan border."

Given the resurgence of the Taliban in Afghanistan, it would be hard to argue that the Pakistani military has provided much help.

This money would have been better kept in the US to repay our public debt, in order to lessen the massive federal debts our future generations are already expected to repay.

Times Square Bombing Suspect and the "No Fly" List

Recent news reports show mounting frustration with the federal government's enforcement of the official "no fly" list, after the suspect in the recent Times Square bombing attempt was able to gain access to an airplane at JFK airport for a planned flight to the UAE before being pulled off the plane and arrested.

"New York City Mayor Michael Bloomberg, while refusing to criticize agencies, said the suspect was "clearly on the plane and shouldn't have been." Homeland Security Secretary Janet Napolitano declined to say how Shahzad was able to board the flight if he was on the no-fly list."

It's ironic that no one is alleging that the suspect boarded the plane with explosives or any other type of bomb-making or havoc-wreaking equipment.

How could he after having been strip-seached at security and possibly several points afterwards?

Perhaps the government should spare us the money and effort it puts into maintaining and updating these "no fly" lists, and focus on simply arresting these suspects when their whereabouts become known.

Better cooperation with other governments around the world, who would be more willing to help us if we weren't constantly saber-rattling at every perceived or imagined threat, could help us achieve that outcome.

School Districts Forecasted to Cut Jobs

Given the downturn in the economy and falling tax receipts, school districts across the country are expected to dramatically reduce headcount in the upcoming year.

Based on a survey of school administrators from 49 states, a total of 275,000
education jobs are expected to be cut in 2011, according to the American
Association of School Administrators.

"Faced with continued budgetary constraints, school leaders across the nation are forced to consider an unprecedented level of layoffs that would negatively impact economic recovery and deal a devastating blow to public education," said AASA Executive Director Dan Domenech.

It's high time that school districts around the country were forced to tighten their belts a bit and respond to market realities just like other businesses, instead of relying on ever-higher tax revenues to hide their bloated staff and pay.

Of the projected job cuts, about 54% are teacher positions, 9% are support personnel, such as nurses and guidance counselors, 5% are administrative and 31% are classified, a category including maintenance employees and cafeteria workers.

It's telling that such a high proportion of the job cuts (46%) are expected to come from non-teaching positions. This is further evidence that school districts have turned into a bloated bureaucracy that is ripe for downsizing.

The Gulf Oil Spill

The oil spill that has ravaged the Gulf of Mexico over the past week will prove to be an expensive clean-up operation for British Petroleum, the company whose operations are the responsible for the disaster.

"There are a lot of uncertainties right now about the Gulf oil spill. But one thing is clear: In addition to the intangible loss of wildlife, it's going to cost BP a lot of money.

Under current law an oil well's owner is responsible to foot the bill for the entire cost of clean up in the event of a disaster. In this case that includes BP and minority partners Anadarko and Mitsui."

President Obama has mobilized an extensive federal response to the spill. However, all of the U.S. taxpayer money being used to aid the closing of the well will assuredly have to be reimbursed by BP.

On Friday, a research note Friday from Bank of America/Merrill Lynch estimated the total clean up costs at $3 billion.

By Sunday, another estimate put the cost at $14 billion.

When it's all said and done (meaning, once the lawsuits have been settled), we'll be surprised if BP (and its suppliers and subcontractors implicated as part of this spill) emerges from this debacle having paid less than $100 billion.

Poll: Stimulus Plan Wasted Taxpayer Money

A recent poll by the Pew Research Center indicates that most Americans are skeptical about the impact of the $787 billion bailout signed by President Obama in February 2009.

"Nearly two-thirds of Americans do not believe the $787 billion stimulus package the president passed last year has helped create jobs".

So in a nutshell, the signature economic plan of the current Administration is viewed as a failure by most Americans.

All that has been accomplished is burdening future generations with an enormous public debt.

It's time taxpayers in America woke up and stopped electing politicians who promise benefits today at tomorrow's expense.

The bills will still show up tomorrow, but the failed stimulus plan again shows that the promised benefits never arrive.