For a time last week, Madison, Wis., resembled Cairo, Egypt as thousands of protesters descended on the Wisconsin capital to protest Governor Scott Walker’s proposal to strip some government workers of some of their rights to collectively bargain. Teachers called in sick and their students marched in protest. Union members bused in protesters for the occasion, and the media said there were as many as 25,000 protestors on hand.
Walker’s battle against the unions is his first step at getting a handle on his State’s budget. The State is short $137 million this year and looking at a $3.6 billion deficit over the next two years.
If Wisconsin were the United States, it would just fire up the printing presses to cover the deficit. But States can’t do that. They must balance their budgets or default.
A scene like the one in Wisconsin may very well come to a State capital near you very soon as States across the country grapple with budget shortfalls. Some State lawmakers are talking about raising taxes, but most of the elected elites on the State and local level recognize that they have pillaged their citizens as much as possible. The folks are bled out, as the saying goes.
So State lawmakers are beginning to make hard choices on cutting services, payrolls and state worker benefits — like the one Walker’s making — that won’t endear them to their constituency… especially the hand-out expecting “gimme, gimme” class.
The U.S., on the other hand, can spend at will, and it has done so to the tune of a deficit that President Barack Obama’s rosiest projections expect to be $1.6 trillion next year. Now a battle is brewing over the budget between Obama, Democrat lawmakers and Republican lawmakers. More and more, the mainstream media is glooming over the possibility of a government shutdown, which will come if the political elites can’t reach an agreement on how best to waste your money.
You can be sure that neither side will make hard choices about cutting spending like Walker and other governors and State lawmakers will have to make. Even the “toughest” Republican budget cutters — excepting those with the surname of Paul — aren’t really proposing cutting anything. Their “cuts” are mere window dressing, put up while the house burns down around them.
Due to pork barrel stimulus programs and bailouts for Wall Street, corrupt banksters and favored special interests, the Federal Government went from a deficit of $167 billion in 2007 to $1.8 trillion 2009 — an increase of 11,000 percent.
None of these did anything to help Main Street. Out here… outside of Washington, D.C., — one in five people are either unemployed or underemployed. For blacks, the unemployment rate is near 50 percent. Businesses are closed or closing, houses are going into foreclosure or stand empty and more and more people need assistance of some kind. Welfare and food stamp rolls are exploding.
So Obama says cuts are needed and he promises they’re coming… right after he spends more on failed mass transit systems (like the little-used AMTRAK and, a bigger boondoggle, high speed rail) and wireless Internet and after he taxes businesses even more, after he raises energy taxes and throws more fiat into the black hole called “green jobs.”
Keynesian economics is thriving, but people living under that failed system of deficit spending are not. They’re looking for a way out, and thought they elected some new leaders last November who were going to show the way. They thought elections meant something, but now they’re waking to the realization that elections mean nothing.
Washington is broken. Elected elites — even many of those newly elected — quickly see a way to enrich themselves and their corporatist sugar daddies and the cycle continues. Electing a bunch of new people running under a new banner just leads to a dashing of hope that makes a big splash but is as futile as a single wave against the sea wall of graft and corruption.
With Federal Reserve Chairman Ben Bernanke helplessly spinning his deluded pronouncements of green shoots (in a television interview in March 2009, Bernanke said the recession would end that year and a recovery would gather steam in 2010), quantitative easing (he said QE would reduce longer-term interest rates on U.S. Treasuries but the rates on 10-year notes have risen from 2.49 percent last November to 3.65 percent last week) and other equally moronic statements, you can be sure things won’t get any better as long as Obama follows his lead.
Watch for much theater out of Washington in the coming days. Elected elites will posture and preen. The press will wail and gnash its teeth over the “draconian cuts” that will lead to “starving children, displaced elderly and hardships for the weakest among us.” And the money printers will continue to churn and dollars will continue to fly out the door.
Meanwhile, when State lawmakers do make the hard choices, those who long sucked off the government teat — led by the thugs directing the government employee unions and egged on by the press — will march on their capitals demanding that its government rape the taxpayers one more time to ensure their cushy arrangement.
Hyperinflation is coming. Bernanke wants a little inflation and thinks he can control it once it’s started. But just as he was wrong about everything else — from missing the indicators of a coming housing collapse to missing the coming recession to the effects of the bailouts — he will be wrong again.
Americans have been pushed to the brink. To quote trends forecaster Gerald Celente, “When the people lose everything, they have nothing left to lose, and they lose it.” Once the line is finally crossed, a citizenry fed up with a pandering, do-nothing, wasteful government will rise up and throw it out. When that happens, the unrest in Egypt will pale in comparison.
If you have taken our advice and own gold and silver and have food and water stockpiled, you’ll weather the storm. Those who choose to depend on big daddy government will suffer.