Obama's Attempts to Turn the U.S. Into a European-Style Welfare State

For decades, western European countries have increasingly become what are known as welfare states.  By that, I mean that most of them use wealth redistribution (taxing the rich) in order to provide hefty and numerous social welfare programs such as universal free healthcare, social security, and welfare pay to those in poverty.  Some countries even provide free tuition for higher education.  Also, there are heavy mandates placed on businesses such as the promotion of collective bargaining and a guaranteed minimum wage.

Now, if all this sounds familiar, it is Barack Obama's philosophy in a nutshell.  Mr. "free" for some but not all.  What he wants is the Europeanisation of the United States.  But, while the President is trying to spend this country in to more and more debt for social programs such as free community college, Europe is trying to extricate itself from the massive debt that these programs have caused.  So, as a result, many European countries are reversing the existence of wide-spread social programs through something they refer to as "austerity".

Lots of social programs are fine until a recession hits. When the Great Recession in the U.S. spread to Europe, it sent its heaviest socialized countries reeling.   Countries, who today, are still in trouble since the recession ended years ago.  Probably, the best indicator of how troubled some of them are is their youth (15-24 years of age) unemployment rates.  After all, they are supposed to be the future of any country.  In Greece, the youth unemployment rate is an astounding 58.4%.  Spain isn't far behind that at 57.3%.  Then, there's Italy at 39.7%;  Portugal 37.8%;  Ireland 26.7%; and, France at 23.7%.  Only Germany is doing well at 7.8%.  In the U.S., youth unemployment is still historically high at 15.8%; though nothing like most of our socialized friends in Europe.

Poverty, too, is high throughout the European Union (EU) and its member states.  While the poverty rate in this country is about 14.5%,  the EU has a collective rate of 16.4%.  And, poverty is on the rise as austerity programs kick in.  Simply, too many Europeans were on the government dole through social programs.  Remove or reduce those programs and more and more people fall into poverty.  Thus, there is a rising backlash against the continuation of austerity programs; resulting in the potential of more European countries become leftist.  A fact that will only deepen debt and dependence on the government.  Except for the rich. Of course!

Basically, Europe is telling us what "not" to do and, Obama and his Democrats aren't listening.  Taxing the rich and giving people a lot of free stuff is putting us at the kind of risk that Europe, now, finds itself in.  In 2014, our top 1% will paid 37% of all taxes; while only earning 19% of this nations wages/incomes.  The top 10% pay 71% of all the taxes.

When recessions hit, rich people also take a hit on their incomes from their investments or companies they may own.   They, also, can lose their jobs as companies go under. As a result, taxes fall and debt increases.  That is what happened in Europe and that is what the President is setting this country up for in the future by making us too dependent on too few rich incomes.  In light of all this, there is an old saying that definitely bears repeating:  "Social programs are a lot like a big red [communist/socialist] wagon.  At some point, you get to a place where there's too many people riding in that wagon and not enough people left behind to pull it."

References:

European social model: http://en.wikipedia.org/wiki/European_social_model

Welfare State:  http://en.wikipedia.org/wiki/Welfare_state

The European Welfare State and Its Lessons for America:  http://www.cato.org/policy-report/julyaugust-2013/european-welfare-state-its-lessons-america

Youth Unemployment by Country: http://data.worldbank.org/indicator/SL.UEM.1524.ZS

Discussion:  Why do Europeans come to the US when college is free over there: http://talk.collegeconfidential.com/international-students/1129831-why-do-europeans-come-to-the-us-when-college-is-free-over-their.html

Up to 25 million more Europeans at risk of poverty by 2025 if austerity drags on:  http://www.oxfam.org/en/pressroom/pressreleases/2013-09-12/25-million-more-europeans-risk-poverty-2025-if-austerity-drags

Europeanisation - Wikipedia:  http://en.wikipedia.org/wiki/Europeanisation

Enough With European Austerity, Bring on the Stimulus: https://www.google.com/search?q=Enough+With+European+Austerity%2C+Bring+on+the+Stimulus&ie=utf-8&oe=utf-8

A radical left-wing party that is demanding an end to Greece's painful austerity measures won Sunday's parliamentary elections: http://hosted.ap.org/dynamic/stories/E/EU_GREECE_ELECTION?SITE=AP&SECTION=HOME&TEMPLATE=DEFAULT&CTIME=2015-01-25-12-09-15

Poverty in Europe: the Current Situation: http://www.inequalitywatch.eu/spip.php?article99

2014 Tax Day Chart: Who Pays the Most?: http://dailysignal.com/2014/04/15/2014-tax-day-chart-pays/

The Rich Are No Longer Recession-Proof - Newsweek: http://www.newsweek.com/rich-are-no-longer-recession-proof-81901

Spain's Current And Future Hikes In Electricity Rates Should Be A Wake Up Call On Obama's Going-Green Initiate

When it comes to going green, Spain is a world leader.  Subsequently, the environmental left just loves them for their "greenness".  In fact, if you view many of the eco websites around the Internet, you will see Spain referred to quite often.

Take, for example, this article, Wind Energy Output Hit Record High in Spain (Kept Electricity Prices Lower than Neighbors’), from the website CleanTechnica.com.  In it, there is nothing but glowing praises on how clean energy has helped Spain keep electricity costs down and created jobs. But, that article was written at the end of February.  By March and based on a prior-year Supreme Court ruling, the Spanish government announced that it must allow electricity rates to rise in order to reflect the "true" cost of energy production.  As a result, Spaniards were hit with a 7 percent rate increase in April.  At the time that the rate increase was announced, their energy minister also indicated that rates should have gone up by 40% to meet the Supreme Court mandate; but, didn't because of the hardship it would impose.  (Click here to see the official announcement)  So, you see, Spain's "lower than neighbors" energy costs just was just a lie; hidden by government subsidies. They are a perfect example of how expensive going green can be.

In the U.S., the average electricity bill is just under $1500 a year. In places like the desert Southwest and deep South, that amount can be twice as high. If President Obama is allowed to proceed with his green agenda for the U.S. by installing wind turbines and solar panels and by killing the coal industry, our rates, too, could easily go up by 40%. For an average family, that's $600 more per year that will have to go to pay the electric bill; hurting the poor and low income families the hardest. And let's also not forget that Spain's debt problems are partly a result of going green. Do we really want to become another Spain? I think it should be a true wake up call for all of us.

Spain's Bailout: Did Obama Get His Way On Aid Without Austerity

When it was announced that Spain was getting a $125 billion banking bailout, everyone thought that the European Union dodged another potential bankruptcy bullet and, with it, Spain would be on a path to getting it's fiscal house in order.  But, then, it was uncovered that Spain got that money without any commitment to austerity.  It was as if the powers to be had just given up on their austerity kick; those prior commitments that came along with previous handouts to Greece, Portugal, and Italy.  For President Obama, it was his dream come true and a put-down of German Chancellor Angela Merkel and her constant calls for bailouts with committed austerity.

To many, the Spanish bailout is just a band aid.  It does nothing to fix the underlying fiscal mess that necessitated it in the first place.  For that reason, the Spanish bailout is so typical Obama.  It's like hisa bailout of GM.  GM's biggest problem, before bankruptcy, was underfunded pension commitments; and that problem, quite frankly, still exists.  It's just been swept under the carpet and is literally a ticking time-bomb that could go off and put GM right back into bankruptcy.  Obama has to know this but, from a political standpoint, he also knows that day will probably come long after he's out of office. 

If Only PIIGS Could Fly!

There's an acronym floating around that seems to be spot-on with regard to the fiscal problems of the European Union. It's called PIIGS. Actually, PIIGS is simple shorthand for Portugal, Ireland, Italy, Greece, and Spain. But, more than anything, these countries truly are "pigs" when it comes to spending and social programs. They are all in debt up to their eyeballs.

Because of these PIIGS, the EuroDollar has been sliding faster than a speeding bullet. Also, these PIIGS may be the reason that the entire European Union disintegrates after having only been in existence for a few years since its founding in 1993. But, for us, the weakening of the EuroDollar is going to kill our trade with Europe because any American made products will become increasingly more expensive for Europeans to buy.

Our stock market and our recovery was being partly driven by our dollar being weak against the EuroDollar. It gave us a trading advantage and the stock prices of heavily exporting companies were continually bid up by higher export sales. Now, with that reality now disappearing, we just might see our economy slip into a secondary or double-dip recession. The dramatic drop in our stock markets over the last 3 weeks says it all. If only those PIIGS could fly!

Is There A Greek Tragedy In Our Future?

Greece is a highly socialist and quasi-capitalist country that is trying to operate within a capitalist environment. One-third of their workforce works for the government. The balance works to literally support all those government workers. That's because government workers are non-contributors to the economics of the country. In reality, they are leeches. And, like too many leeches attached to any body, the body will finally die for the lack of blood.

The blood letting really stems from the fact the unions are so strong in Greece. A union worker, working for the government, can retire at age 53 with full benefits and at their highest pay for life. This is unsustainable. Because of this and other factors, the Greek debt is now more than 90% of their total Gross Domestic Product (GDP). Please understand that this is not a percentage of "gross domestic profit" that would be capable of generating tax revenues for the country. Instead it is total value of the products that Greece produces and, from which, the actual taxable income is less than 10%. This, then, makes it almost impossible to pay back any debt without years and years of reduced spending and increased taxes. Making things worse, the Greek debt is so high, that the rating agency, Standard and Poors, has had to downgrade Greece to junk status for their bonds. This in effect has caused the amount of interest that Greeks pay on their debt to skyrocket; making it even harder for them to avoid defaulting on all their loans.

The European Central Bank (ECB) and the International Monetary Fund (IMF) have come up with the equivalent of $146 billion to bailout Greece. But, the money has strings attached. Those strings are primarily aimed at labor with mandated reductions in government worker pay and benefits; including retirement pay. Thus, the riots in the streets.

The ultimate survival of Greece lies in the hands all the unions. But, as you can see, the riots tell a story of a labor element within Greece that is not willing to budge on pay and benefits. So, it is my opinion, as well as others, that Greece will fail to recover. Ultimately, the European Union will have to shed Greece out of its need for self-preservation. Greece is a gangrenous appendage that could take down the rest of the European economic union, and as such, it must be amputated.

As a result of this excision, Greece will default on all of its debt obligations. No one will want to trade with that country without extreme guarantees or by forced higher prices for everything that the Greeks need to survive. That means that Greece will plunge itself into a deep economic (and, probably mental) depression with double-digit inflation. In effect, it will become a mini version of what this country looked like in the 1930's.

Is this outcome in our future? It might just be. In states like California, New Jersey, and Michigan and in so many others, the amount of unionized government workers with similar pay and benefits guarantees is very high. And, as we have already seen in California and New Jersey, the unions refuse to budge on any more cuts in jobs, pay, or benefits; while, in the non-government sector, people are sustaining heavy unemployment levels. To make things worse, this President and this Democratic Congress have poured billions into state governments vis a vis the Stimulus Package to keep them from making the needed, hard decision to cut back on any unionized government workers; including teachers, police, and firemen. But, the spending continues and their deficits keep increasing and a Greece-like situation is already sitting at their doorsteps; with our Federal government being the only recourse to keep these states alive. But, that too, could accelerate the country's path to higher and higher debt in less time than was previously thought.

I am concerned that we have the same problem ahead of us that the European Union is having with Greece and other countries like Portugal, Spain, and Ireland. Except, in our case, it is the very socialist nanny-states like California who will become our equivalent of the current Greek Tragedy. And, let's not forget, our national debt is expected to exceed Greece's 90+ percent of GDP by the year 2020 and become as high as 125% of GDP by 2030. So, if we don't heed Greece as the Skull & Crossbones warning in our path to increasing social programs, it won't just be California but this whole country that collapses.

The Grecian Formula?

As I write this, the Central Bank of the European Union (the ECB) is putting together a $60 billion (in U.S. dollars) rescue package (a loan) to save Greece's bacon and keep it from completely collapsing into utter financial chaos. But, all this loan will do is delay the inevitable if Greece doesn't comes to grips with the bad financial housekeeping that got it into this problem.

Greece is like so many countries who are heavily burdened by too many expensive social programs and labor union related issues. Raising taxes just won't do it because taxes are already high and any new ones will just kill what's left of a fast declining economic environment. The problem of trying to cut back on social programs, excessive union labor rates, and spiraling expenses for fat retirement packages is that no one wants to give up their particular "program" or a "percentage of their wages" or "retirement pay and benefits". But, if Greece doesn't cut into all these costly programs, it will just burn through that $60 billion dollar loan like a brush fire in a drought-ravaged forest and, once again, find itself facing collapse. Greece, itself, has claimed that it really needs $160 billion to remain solvent over the next three years.

What is happening in Greece is bound spread to other Euro-Socialist countries. Licking the heals of their financial morass is Portugal, Spain, Ireland, and Iceland. Not far from that pack is Italy. So, if it spreads, you've got to wonder if the European banking system will be able to float another $100 billion more for Greece and, then, bailout Portugal. Or, another $100 billion for Spain; and, so on. I don't think so. If that should happen, and in a worst case scenario, the world could literally see a complete collapse of Europe's banking system.

If so, would the U.S. and other nations come to Europe's aid with the equivalent of an international TARP rescue program? Just maybe! And, that could actually put us at risk for collapse, also. That's because some of our own "states" are quickly closing in on their own financial crises. Right now, California is close. Like Greece, it has all the earmarks of a government gone wild with social programs, union wages, and generous pensions. Other states like New Jersey, New York, Arizona, and Illinois aren't that far behind. All together, our 50 states had a near-$50 billion combined shortfall for last year, alone; and, all see those numbers growing into this year and beyond.

These are very troubled times. Perhaps, just a calm before the ultimate storm.

Stop The Green Jobs Insanity Mr. Obama!

Wind and solar might create new jobs, but it will do so at the cost of losing an equal or greater amount of fossil fuel energy related jobs.

Obama keeps hyping "green" jobs as if every new green job will result in a net increase in overall jobs. But, nothing could be further from the truth.

In Spain, it was determined that two jobs were lost for every new green job that was created as the nation's energy costs were more than doubled in that country's "green" efforts (Click to See Full Story: "Job Losses From Obama Green Stimulus Foreseen in Spanish Study").

In the U.S., the losses could be even higher if the last vestiges of manufacturing operations in this country are moved off shore in order to remain globally competitive as our energy costs keep rising. Furthermore, other jobs could be lost to overseas locations if the EPA creates oppressive carbon regulations or if "Cap and Trade" legislation is passed.

China, India, and Indonesia must be doing cartwheels over Obama's green jobs program. China should be especially happy because billions of dollars in wind turbines are being imported into this country -- giving their economy (not ours) a big boost in job creation. Here's just "one" example: (Click to See Full Story: "Chinese and American Partners to Build Big West Texas Wind Farm").

The Green jobs plan is the "liberal" agenda of the eco nuts of this world. In the end, jobs will be lost and businesses will be killed by extremely high energy costs.

By The Way: Besides Greece and Portugal, Spain -- a leader in creating green jobs in Europe -- is one of the three current European Union countries who are near financial collapse. Obama keeps saying "green jobs" will save our economy. Obviously, Spain didn't benefit from their efforts to go green. In fact, it might be why they are in such bad shape.