Join Jim and Greg as they explore some of the ideas on China that ought to unite conservatives, moderates, and even some Democrats. They also shudder as Bernie Sanders is about to become chairman of the Senate Budget Committee and plans to use the reconciliation process a lot to avoid Senate filibusters. And they unload on Don Lemon for demonizing all Trump voters because some repulsive figures supported him too.
Sen. Rand Paul is not holding back his disgust for the bloated spending contained in the bills to fund the federal government through September 2020.
“The nicest thing I can say about them would be they’re an abomination,” laughed Paul. “They’re terrible. People who vote for this are not fiscally conservative. There’s nothing conservative about this.”
In the podcast, Paul also explains why a majority of Republicans are uninterested in fiscal discipline along with the vast majority of Democrats.
Sen. Paul also reacts to the Washington Post reports revealing that the Bush and Obama administrations really didn’t know what to do in Afghanistan and both actively deceived the American people about progress that wasn’t really happening. What policy does Paul think would make the most sense and prevent Afghanistan from breeding more terrorist attacks.
And listen as Sen. Paul offers his preview of the impeachment trial headed to the U.S. Senate come January.
Eager to avoid a debt ceiling showdown, the Treasury Department and congressional Democrats appear to be on the brink of a budget agreement that could saddle taxpayers with an additional $2 trillion in debt over the next decade.
According to reports, the agreement runs through July 31, 2021. It would effectively end all remaining elements of the 2011 Budget Control Act known as sequester, while adding $350 billion in new spending in exchange for about $75 billion in offsets.
If that seems lopsided in favor of more spending, that’s because it is. But National Taxpayers Union President Pete Sepp says it’s even worse than it looks.
“The things is there are ripple effects past two years. If you do a decade-long total, you’re talking about something closer to $2 trillion of additional spending permitted by this deal,” said Sepp.
Sepp also points out that a lot of new spending never goes away.
“Many of the spending increases called for will be baked into future budgets going down the line even if they try to re-establish the debt ceiling a couple of years from now. So this is a real problem for taxpayers and, unfortunately, it represents the final retreat from the Budget Control Act of 2011, which established that sequester process,” said Sepp.
National Taxpayers Union research shows the sequester process saved the average American household roughly $7,400 by 2017. Sepp says removing those restraints is nothing more than a massive tax hike on future generations and the future is coming sooner than wee realize.
“Deficit spending is really just tax increases on a future type of taxpayer: unborn taxpayers, or young taxpayers, even taxpayers who are currently filing their taxes down the line would face higher taxes to service all of these debts,” said Sepp.
Listen to the full podcast to hear Sepp respond to suggestions that sequestration cuts were “mindless and irresponsible.” He also explains why spending “offsets” are often a mirage, why the Trump administration isn’t demanding more fiscal restraint, and why so few people seem to care about the mounting debt.
The partial government shutdown is ratcheting up political tensions in Washington and cranking up the financial tensions for federal workers going without a paycheck, but one personal finance expert says an important lesson from this impasse is to be financially prepared in case the income suddenly stops.
An increasing number of media stories highlight government employees struggling to make ends meet or even put food on the table. But they’re more the rule than the exception. Dave Ramsey Financial Expert Chris Hogan says millions of Americans are also facing dire straits if they miss a paycheck or two.\
“Almost 80 percent of people are living paycheck to paycheck,” said Hogan, who is also author of the new book “Everyday Millionaires: How Ordinary People Build Extraordinary Wealth. “You’ve got people who are running out of money before the end of the month.”
While empathizing with the uncertainty those employees face in awaiting their next paycheck, Hogan says careful planning and budgeting can better prepare people for any unforeseen income stoppages.
He says the first two steps are addressing any debt and stripping away frivolous expenses to focus on basics such as food, clothing, shelter, and transportation.
Ramsey is well known for imploring people to avoid going into debt and Hogan is preaching the same message. But he says there are smart ways to free yourself from those burdens, including eliminating your smallest debts first and building momentum to pay off student loans and other expensive obligation.
As for what to do once your head is above water, Hogan says there are proven methods to follow in order to build savings and wealth.
“You’ve got to learn to live on less. Even with your budgeting and understanding what it requires for you to live on, we’ve got to figure out those things to stop doing immediately,” said Hogan.
Some of his suggestions include far less use of debit cards and eliminating unnecessary expenses like cable television.
He then suggests starting with a goal of saving $1,000 and eventually putting away three to six months worth of savings. As the money builds, he recommends investing in retirement accounts, putting money away for higher education, and eventually being in a position to be a charitable donor.
Listen to the full podcast to hear Hogan offer much more detail on the steps to no longer living paycheck to paycheck and how to pull yourself out of debt.
Listen to “Schumer’s Silly SCOTUS Strategy, Bernie’s $3.2 Trillion Single-Payer Scheme, TSA Monitors Sweaty People” on Spreaker.
Jim Geraghty of National Review and Rich McFadden of Radio America break down Senate Minority Leader Chuck Schumer’s request that red-state Democrats remain neutral on Brett Kavanaugh’s nomination to the Supreme Court. They also cannot believe that some Democrats are seriously considering the idea of almost doubling the federal budget to pay for Sen. Bernie Sander’s Medicare-for-all program. And they cannot find any examples of malfeasance in the Boston Globe’s story about the TSA’s passenger-monitoring program that tracks people who sweat too much and urinate too often.
Earlier this year, a $1.3 trillion dollar omnibus spending bill left many fiscal conservatives wretching over the rise in domestic spending, but Hillsdale College Prof. Gary Wolfram says mandatory spending is real emergency and we’ve got less than a decade to do something before it gobbles up all of our revenue.
Wolfram teaches economics and public policy at Hillsdale. He also served as chief of staff to former Rep. Nick Smith, R-Mich, in the mid-1990’s and on the Michigan State Board of Education.
The omnibus controversy arose when President Trump and Republican congressional leaders agreed to huge increases in domestic spending in exchange for lifting the spending caps on national defense spending.
In a recent column, Wolfram explains that mandatory spending – Social Security, Medicare, Medicaid – is the much greater threat. What makes it mandatory is specific congressional acts dictating how much is spent on those programs.
In our interview, he discussed how much federal revenue goes towards mandatory spending now and what it will look like in a few years if the problem is not addressed.
“If you look at mandatory spending plus interest on the debt, in 2019 it’s going to be 70 percent of the budget outlays and 89 percent of the revenue. So if Congress didn;t enact anything, 89 percent of the revenue’s going out the door already with mandatory spending.
“If you get to 2028, according to the Congressional Budget Office, 98.5 percent of all the revenue that comes into the federal government is going to be spent already, either through Social Security, Medicare, Medicaid, and some other items that are already mandated, plus net interest,” said Wolfram.
“So if you do not do something about Social Security and Medicare, which between them are almost two trillion dollars in 2019 and are going to be $3.3 trillion in 2028, you’re not going to do anything about the deficit,” said Wolfram.
While Wolfram believes each mandatory program must be reformed, his first recommendation is to change the appropriations process. In Wolfram’s home state of Michigan, the legislature determined how much is spent on each program every year, regardless of what is mandated in statute. He says the same principle should be applied in Washington.
“Let’s say Social Security is supposed to spend $1.043 trillion in 2019. If this were the way the Constitution worked in the federal government, Congress appropriates a trillion dollars. Everybody gets their proportionate share of the trillion dollars. I think that’s the type of thing we’ve got to be looking at,” said Wolfram.
Wolfram says Congress won’t get serious about reforming programs until members are faced with passing a massive hike on Medicare and Social Security taxes.
He ought to know. When serving for Rep. Smith, Wolfram pushed legislation that would allow taxpayers to set aside a portion of the their Social Security tax payments into a private account in exchange for receiving smaller checks when they retire. Only one other members showed up at the press conference announcing the bill.
But he says there are still measures that could do some good.
He says keeping the system in place for Americans 55 years and older is doable if younger people are told they won’t get Social Security benefits until they are 70 or 75. However, he believes Medicare needs a far more drastic overhaul.
“With Medicare, you’ve got to change the way the system works. You’ve got to make it like health savings accounts are in the private sector, where it’s a high deductible policy where you get so much and then you ask the question, ‘How much does it cost when you go to get your blood test?'” said Wolfram.
He says there are simple ways to drastically reduce Medicaid costs as well.
“Think of what the incentives are in Medicare or Medicaid. It’s to produce something that the government will pay for, even if it’s inordinately expensive, because the person buying it is not the person receiving it,” he said.
Wolfram says the health savings account approach works well on Medicaid as well.
“If you apply that to Medicare and Medicaid, it’ll change the whole incentives of the system. I’ll be Walmart or Walgreens and I’ll have a nurse practitioner there, charge you ten bucks to tell you your kid’s got pink eye and then provide you with a prescription,” said Wolfram.
Congress refuses to deal with the problem, but Wolfram still holds out hope that lawmakers will do the right thing when they have no other choice.
“I believe at some point things are going to get bad enough that they’re going to have to deal with it,” said Wolfram.
Jim Geraghty of National Review and Greg Corombos of Radio America are encouraged that six months before the midterms, DNC Vice Chairman Keith Ellison is promising that people will die if Democrats don’t win. It’s an indication that Democrats don’t have much of an agenda to run on other than fear and opposing President Trump. They also throw up their hands as congressional Republicans reportedly have no plans to try to pass a budget this year because it will be really hard to pass in the Senate. They react to Sean Hannity being named as one of Michael Cohen’s clients, and while there may be no legal scandal, Hannity is definitely wrong to have not disclosed this connection. And Jim has some theories about the man in the sketch released by Stormy Daniels.
Republicans cleared a major hurdle on the march towards tax reform legislation last week when the House and Senate agreed on a budget bill, but one House member says GOP members have their heads in the sand and are limiting the scope of tax reform by scrapping their own conservative budget for a status quo approach from the Senate.
Rather than head to a House-Senate conference committee, the House agreed to vote on the Senate’s budget bill. It passed 216-212, with 20 Republicans voting against it. One of the them was Rep. Matt Gaetz, R-Florida.
Critics accused Gaetz and the other Republicans opposed to the budget of opposing tax cuts. Gaetz says the explanation for his vote is simple.
“While I’m all about getting the economy moving with productive tax cuts, we’ve got to be honest with ourselves about the challenged we face with spending. I’m going to use my position on the budget committee to try to advocate for spending cuts so that wee don’t drive up deficits while we’re working to get the economy moving again,” said Gaetz.
He says the original House budget bill was one he was proud to support.
“The House of Representatives passed a conservative budget that cuts spending by over $200 billion. We actually laid out a plan to accomplish those spending cuts, by ensuring that able-bodied, childless adults, who can choose to work, would actually have to meet a work requirement before getting benefits from the government,” said Gaetz.
He says the Senate wanted no part of that.
“When we sent these conservative ideas over to the United States Senate, unfortunately the Senate did not agree to cut a single nickel in spending. Instead, they merely sent a budget back that kept things the way they were and preserved the status quo,” said Gaetz.
He says that not only kicks the can down the road on fiscal responsibility but chokes off a more aggressive approach to tax reform.
“I was very disappointed that the swamp creatures over in the Senate didn’t have the guts to cut spending. We’re going to keep fighting for spending cuts in the House. I think that’s the way that we get the full value out of tax reform. If businesses in our country have the capital to be able to hire more people, it will all be for naught if we don’t deal with the workforce challenges that incentivize people to stay home,” said Gaetz.
He’s also tired of the House playing second fiddle to a Senate that can’t make good on the GOP agenda.
“I didn’t run for the House of Representatives to come here and be a rubber stamp for the Senate. I think too often in the House, we’re the Senate’s lapdog. Look at health care. We would have passed whatever the Senate passed. Look at the budget. We take whatever the Senate gives us.
“My hope is when we get to tax cuts, we won’t whittle down the value of tax cuts, we won’t fail to deliver on the promises President Trump has made regarding massive tax cuts, just because the Senate cannot do both things,” said Gaetz.
Gaetz is also frustrated with the Senate catering to the whims of the most liberal Republicans who he says ran on the same agenda of cutting spending, repealing Obamacare and cutting taxes only to embrace the status quo once they came back to Washington.
He says tax reform is going to present more hurdles as senators get bombarded by special interests to keep their special provisions in the tax code.
“[Fiscal conservatives} are becoming a bit of an endangered species on Capitol Hill. It’s indicative of the environment we live in, where every special interest wants the government to spend more money because then there’s more room in the trough for their respective snouts,” said Gaetz.
He says the bottom line is lawmakers must stop piling up debt for future generations, a problem he says ought to be blamed on both parties.
“They’re all fighting for more spending in different areas. So we’ve got to have courageous conservatives ready to stand up and say, ‘No more. We are not going to participate in this great wave of generational theft. In the last 15 years, we’ve stolen more than $15 trillion from the next generation. And they’re going to have to pay that back with interest,'” said Gaetz.
He says the mounting debt is also a burden on efforts to jump start the economy.
“The debt is a wet blanket over our economy and there is no amount of tax cuts that will ever allow us to grow to meet the obligations we’ve set forth in the absence of spending cuts,” said Gaetz.
Jim Geraghty of National Review and Greg Corombos of Radio America discuss rapidly dropping rates in illegal immigration across the southern border. They also reproach Illinois state representatives – especially Republicans – for agreeing to tax hikes instead of dealing with major fiscal problems. And they question CNN’s decision to intimidate an anonymous Reddit user over the controversial GIF President Trump re-tweeted on Sunday. To finish off the day, they criticize the History Channel for concluding what happened to Amelia Earhart based largely on one photograph.
After concluding Washington is incapable of solving some of America’s biggest problems over his 16 years in Congress, former Sen. Tom Coburn, R-Okla., says a constitutionally provided convention of the states is the only realistic remedy to what ails us.
Article V of the Constitution allows for amendments through a convention of two-thirds of the states proposing changes that would then need to be ratified by three-quarters of the states. Currently, 34 states would need to get on board to force Congress to call a convention and 38 states would need to approve any proposed amendments.
“Before our constitutional convention, everything was decided through a convention like this,” said Coburn, who points out George Mason insisted on the inclusion of the convention of the states option after pointing out no government in history has ever given back power to the people.
Coburn further explained the process.
“You have to an application that aggregates (among the states). You have to have the same application everywhere. You can’t have one application for a balanced budget and one application for something else. You have to have 34 that say the same thing,” said Coburn.
The current push for a convention of the states calls for three amendments: one to balance the budget, one to rein in the reach of the federal government , and one to limit the length of terms in the House and Senate.
Coburn says a balanced budget amendment is desperately needed.
“We think the federal government ought to be fiscally responsible. They ought to have to live under the same accounting guidelines everybody else does and they ought to have to live within their means,” said Coburn. “That’s a balanced budget amendment but it also means you can’t just go and add mandates to the states to balance the budget. You have to make hard choices.”
Congress came within one vote of approving a balanced budget amendment in 1995, just months after Republicans won control of both chambers. The plan passed the House 300-132, but the 65-35 tally in the Senate was just shy of sending the amendment to the states.
The vote was really 66-34, but when it was clear the measure would fail then-Senate Majority Leader Bob Dole, changed his vote to no so he would be eligible under Senate rules to reconsider the issue. A subsequent vote also failed.
Since 1995, no balanced budget proposal has come anywhere close to passing, and Coburn says that should come as no surprise.
“They don’t want to balance the budget, because then they have to make hard choices, then they have to be accountable to their electorate. If the electorate doesn’t like the choices that they made, they’ll replace them. It’s an insurance policy if I don’t have to have a balanced budget,” said Coburn.
“The easiest thing in the world is to spend somebody else’s money and that’s what they do every day. They spend our grandchildren’s money because we’re certainly not spending our own right now,” said Coburn.
Next on the amendment list is to “limit the scope and jurisdiction of the federal government.” Coburn says a ridiculous case from 1942 effectively gave the federal government to meddle far too intimately in our lives.
“An Ohio wheat farmer grew 18 acres more wheat than he was allotted, but he used every bit of it to feed his own cattle, his own family and used it for feed the next year. The federal government said that’s interstate commerce because you didn’t buy that 18 acres worth of wheat from somewhere else,” said Coburn.
“So they expanded the commerce clause and that is what has allowed the federal government to tell every state – in everything they do now – what to do,” said Coburn.
Coburn says returning power to state and local authorities also heightens accountability, pointing out it is much easier to get an appointment with your state representative than a member of the House or Senate.
Coburn cited a recent poll showing 86 percent of Americans don’t trust the federal government. He says that places America in a crisis that returning power to states and locales can help to address.
“When you quit trusting the central authority, then you will no longer follow its will. That’s called anarchy. So we have to take back our freedom. We have to re-establish the rule of law and make sure it’s followed. But also it has to have the integrity of the central government in terms of a limited federal government,” said Coburn.
The third and final amendment Coburn and his allies are pushing would limit lawmakers to 12 years in the U.S. House of Representatives and 12 years in the U.S. Senate.
“Prior to a Supreme Court ruling in 1994, 26 states had limited the terms of their members of Congress. In an Arkansas case, the Supreme Court decided that we as citizens can’t decide whether we want to limit the terms of our federal representatives. Well that’s ludicrous. So what you do is pass an amendment that puts a limit on the amount of time people can serve,” said Coburn.
Coburn says 12 states are already on board. He expects another 10-12 states to join the effort in the next 12 months and another 10-12 in the year after that, meaning a convention of states could take place within two to three years.
He is quick to stress that the convention itself cannot ratify the amendments. That role still belongs to the states. Coburn is bullish on that front as well, noting that Republicans are just 24 seats away from controlling the legislatures in 38 states.
Ultimately, Coburn believes the success or failure of this campaign will depend upon the courage to do what has to be done.
“Do we have the moral structure with which to make these hard decisions for the future or do we just let this train run out of control down the mountain? That’s the real question,” said Coburn.
“If you love your kids, you love your country, and you love your future, you ought to be about choking down the federal government and having it live within its means, lessening it’s impact on the economy so the economy can actually grow,” said Coburn.