Have nothing to do with the [evil] things that people do, things that belong to the darkness. Instead, bring them out to the light... [For] when all things are brought out into the light, then their true nature is clearly revealed...

-Ephesians 5:11-13

Category Archives: Economics

Nine of 12 Super Committee Members Named: Tea Party Marginalized

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Senate Majority Leader Harry Reid was the first to announce his three nominees to the “Super Committee” created by the recent debt ceiling increase, and all three fit the mold of big-spending liberals: Senators John Kerry (D-Mass.), Max Baucus (D-Mont.), and Patty Murray (D-Wash, right.), the latter of whom will also serve as co-chairman of the committee. Reid observed of his picks:

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Standard and Poor’s Extends, Defends and Explains Its Downgrade

Standard and Poor - not the most popular build...

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In a series of expected additional press releases, the Standard & Poor’s credit rating agency is expanding its downgrade of debt securities tied to the now-lower-rated sovereign debt of the United States, including Israeli bondsFannie Mae and Freddie Mac, and “pre-funded” municipal bonds. Other credits tied closely to U.S. sovereign debt are also expected to be downgraded shortly, with only a few exceptions.

Most municipal bond issues are not pre-funded with U.S. Treasury securities, and so they aren’t likely to

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S&P Downgrade: Does It Portend a Death Spiral?

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Standard and Poor’s was blunt in its assessment of America’s deteriorating financial condition when it announced Friday night that it was cutting its credit rating on United States’ Treasury securities from AAA to the second-tier AA+, with a negative outlook. S&P said:

Progress [in] containing the growth of public spending, especially on entitlements, or on reaching an agreement on raising revenues, is less likely than we previously assumed

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Corzine to Replace Geithner as Treasury Secretary?

HOBOKEN, NJ - NOVEMBER 02:  New Jersey Gov. Jo...

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Despite protestations from Jon Corzine, former New Jersey governor, that he has no interest in taking Treasury Secretary Timothy Geithner’s place if Geithner decides to step down, Corzine did manage to have a clause put into his company’s bond offering prospectus that if he did accept the position, bond holders would be paid an extra one percent interest, just in case.

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U.S. Credit Rating Still at Risk


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Moody’s announcement on Tuesday that it would retain its AAA rating of U.S. government sovereign debt as a result of the debt-limit agreement came with a warning: the government must rein in spending or risk a downgrade anyway. The deal “virtually eliminated the risk of [a] default,” but the agency warned that “Should the new mechanism put in place by the Budget Control Act prove ineffective, this could affect the rating negatively.” Moody’s added that it wanted to see the United States lower its debt-to-GDP ratio, now approaching 100 percent, to around

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Debt-Limit Deal’s Trojan Horse: The “Special” Committee of 12

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The debt ceiling is to rise initially by $900 billion under the Revised Budget Control Act of 2011. And then, the debt limit is to rise again by either $1.2 trillion or $1.5 trillion depending upon how successful the 12-member Joint Committee of Congress is in finding sufficient cuts in government spending to avoid a “trigger” that would do the cutting automatically. The committee will be made up of

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Debt Ceiling Crisis: Putting Things Into Perspective

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The compromise bill that emerged Sunday night from behind closed doors is being loudly trumpeted in an attempt to persuade recalcitrant conservatives in both houses to vote for something—anything—in time to avoid the August 2 deadline.

A careful analysis of the ultimate compromise bill yields some important conclusions. First of all, there is nothing in the law or statutes that

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County in Alabama is Bankrupt, Just Like the U.S.


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At the very last minute, county commissioners in Jefferson County, home to the metropolis of Birmingham, Alabama, decided to postpone a final decision on whether or not to declare bankruptcy over their excessive indebtedness. The bonded indebtedness incurred to build a state-of-the-art sewage treatment plant exceeds $3 billion, far beyond what the county can afford to service. And raising sewer fees for a fourth time in ten years

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Lacking Support, Boehner Delays Debt-Limit Vote

John Boehner - Caricature

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House Speaker John Boehner’s last-minute “pep talk” to his Republican caucus early Thursday morning failed to turn the tide of Tea Partier “nays” to “yeas,” and the vote on his debt-limit bill has been postponed. Calling on them to “get…in line” because “I can’t do this job unless you’re behind me,” Boehner failed in getting the 216 votes he needed. He claimed, “The Republican proposal includes real spending cuts and reforms that will restrain future spending—and the spending cuts are larger than the debt limit increase.”

He went on to say his bill represents “the best opportunity we have to hold the president’s feet to the fire. [Obama] wants a $2.4 trillion blank check that lets him continue his spending binge through the next election. This is the time to

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“Extremist” Presidential Candidate Ron Paul

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Claiming that presidential candidate Ron Paul leads the “economic suicide wing” of the Republican Party, Brent Budowsky, writing for The Hill, says that Paul is the “worst possible role model” for Republicans because he suggested that a default by the government “would be OK.” Budowsky calls Paul a “Banana Republican,” claiming that Paul is taking an extremist position, adding that keeping the debt ceiling in place and putting the government on a diet would “literally crash American and global markets…that would do grave damage to our nation.”

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Debt Ceiling Talks: from Disagreement to Impasse to Crisis

Partisan Fail

Image by colarusso via Flickr depicting a political take on the Twitter "FAIL Whale" screen.

House Speaker John Boehner walked away Friday from debt ceiling negotiations with President Obama, saying that the White House had “moved the goalposts” in their weeks-long effort to come to terms acceptable to both Republicans in the House and Democrats in the Senate.

In his letter to members of the House, Boehner said, “During these discussions…it became evident that the White House is simply not serious about ending the spending binge that is destroying jobs and endangering our children’s future…. In the end, we couldn’t connect. Not because of different personalities, but because of different visions for our country.”

He went on to say:

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Obama’s Letter to Americans: Stand Behind Efforts to Raise Debt Limit

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President Obama’s open letter to the American people published yesterday in USA Today challenges them “to do something big and meaningful” and stand behind his efforts to raise the debt ceiling.

This debate [over the debt ceiling] offers the chance to put our economy on stronger footing, and [to] secure a better future for our children. I want to seize that opportunity, and [to] ask Americans of both parties and no party to join me in that effort.

Obama’s letter is carefully crafted to persuade the average reader that the country’s present perilous financial condition was not caused by the Ruling Class at all but by all citizens working out their daily lives.

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Minnesota Shutdown Ends with Compromise Pleasing No One

Minnesota State Representative Mindy Greiling

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Now that the Minnesota state government shutdown has ended, details of the compromise between Governor Mark Dayton and the Republicans are now public—and no one is happy.

At issue was the $5-billion shortfall between revenues and spending. Liberal Governor Mark Dayton had his own plan for bringing in more revenue: “I believe the wealthiest Minnesotans can afford to pay more taxes,” he commented. Conservative Republicans in the state House and Senate, including House Speaker Kurt Zellers and Senate Majority Leader Amy Koch, dug in their heels on any tax increase whatsoever. In the end, both sides lost. As noted when the Minnesota state government shut down, the real bottom-line question had

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President Obama Pledges Spending Cuts to Eisenhower Era

Dwight D. Eisenhower

Cover of Dwight D. Eisenhower

At last Friday’s press conference, President Obama reviewed the status of talks with Republicans over the debt ceiling and reiterated his determination to “get our fiscal house in order.” He added:

We have a unique opportunity to do something big. We have a chance to stabilize America’s finances for a decade, for 15 years, or 20 years, if we’re willing to seize the moment.

Now, what that would require would be some shared sacrifice and a balanced approach that says we’re going to make significant cuts in domestic spending. And I have already said I am willing to take down domestic spending to the lowest percentage of our overall economy since Dwight Eisenhower. (emphasis added)

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Looking for Green Shoots in the Economy

Cracked Mud Texture

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Just a month ago one of the most accurate economic forecasters on the planet looked at the economy and concluded that another recession is 99 percent certain.

David Rosenberg of Gluskin Sheff, a Canadian private money management firm, noted at the time that consumers were still trying to reduce their debt load, which reduces their ability to purchase consumer goods and services. That continued reduction in demand is being felt all across the economy with no end in sight:

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August 3: Day of Reckoning

Obama money!

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On Tuesday evening, President Obama was being interviewed by Scott Pelley, who asked the President whether he could guarantee that Americans would get their Social Security checks if the debt ceiling weren’t raised:

Pelley: Can you tell the folks at home that, no matter what happens, the[ir] Social Security checks are going to go out on August the 3rd?

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Food Crisis Used to Push Global Governance

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According to internationally acclaimed author and highly regarded expert Lester Brown, writing in the January 10 issue of Foreign Policy magazine:

Tonight there will be 219,000 additional mouths to feed at the dinner table, and many of them will be greeted with empty plates.

Another 219,000 will join us tomorrow night.

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Fed Insiders Selling Inside Information

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In an effort to plug leaks at the Federal Reserve, the U.S.’s central bank issued a statement yesterday that members of the Federal Open Market Committee “will refrain” from sharing insider information “with any individual, firm, or organization who could profit financially from…that information.”

Since the establishment of the Federal Reserve in 1913, its operations and decision-making processes have been deliberately opaque. In the 1990s the minutes of its policy meetings weren’t made public for

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Food Prices Rocket

Eighty-year-old Dottie Bell is a volunteer at the Community Market food bank in Opelika, Alabama, and every day she sees the impact of high food prices on people in her community.

In the last 12 months, more than 3,000 families have come to her food bank for food assistance. Michael Davis is just one of them. When Dottie asked him for his identification, he pulled out his driver’s license and Social Security card from a worn ZipLoc bag and handed them to her. When she asked when the last time was that he’d eaten anything, he said: “About two days. It’s not a good feeling. You have to

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Economists Are at a Loss; So Are Jobs

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Once the awful job numbers announced by the Bureau of Labor Statistics on Friday were digested, it was clear that the clairvoyant economists looking into their crystal balls were dead wrong—again.

Most economists were expecting a pickup from May, with job growth estimates ranging from 100,000 to 175,000, and an upward revision on the May numbers as well. Neither happened. A mere 18,000 jobs were created in June, and the May numbers were revised downward from

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Many of the articles on Light from the Right first appeared on either The New American or the McAlvany Intelligence Advisor.