Totally Out of Touch with Reality

By: Mike Shedlock | Tue, Oct 25, 2005
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Congress is totally out of touch with reality. Now most people have long been aware of that for quite some time, but following are a few extreme cases reported just today. The first is a New York Times interview with Connie Mack, the Chairman of the President's Advisory Panel on Tax Reform.

Here are some Questions for Connie Mack, followed by his replies.

NYT: You have already announced a proposal to eliminate the alternative minimum tax for individuals, which will cost the government $1.2 trillion in lost income over the next decade. Do you find it difficult to cut taxes post-Katrina, when the government is desperate for revenue?
CM: The Congress and the president can address that issue. Of course, the president already has addressed that issue. He said there won't be any increases in taxes.

NYT: Well, the U.S. government has to get money from somewhere. As a two-term former Republican senator from Florida, where do you suggest we get money from?
CM: What money?

NYT: The money to run this country.
CM: We'll borrow it.

NYT: I never understand where all this money comes from.
CM: When the president says we need another $200 billion for Katrina repairs, does he just go and borrow it from the Saudis? In a sense, we do. Maybe the Chinese.

There you have it. The President's Advisory Panel on Tax Reform and has no idea where money comes from other than we borrow it from the Saudis and perhaps the Chinese. If the president needs another $200 billion, no problem, we just borrow it.

These are the clueless people running our country. There is no hint of fiscal sanity by anyone in this administration or this Congress. Here we are, well into Bush's second term and the President has yet to veto a single appropriations bill, or for that matter any bill. No one seems to think of this as real money. We just borrow it.

Well it really isn't real money since it is not backed by gold or any other assets for that matter. We need money, we just borrow it. If no one will loan it to us, we just print it. No one cares, for now anyway.

Given that the appropriations process is painless (until this mess blows up in a credit crunch), there is simply no limit to the stupid things we spend this borrowed money on incluing (as ridiculous as it may seem) spending money to prevent terrorists from playing Bingo.

Are Terrorists playing Bingo?

One might think so given this funding to prevent it:

Kentucky lands grant to protect bingo halls from terrorists.

Kentucky has been awarded a federal Homeland Security grant aimed at keeping terrorists from using charitable gaming to raise money.

The state Office of Charitable Gaming won the $36,300 grant and will use it to provide five investigators with laptop computers and access to a commercially operated law-enforcement data base, said John Holiday, enforcement director at the Office of Charitable Gaming.

The idea is to keep terrorists from playing bingo or running a charitable game to raise large amounts of cash, Holiday said.

"The idea is to keep terrorists from playing bingo...". Wow, I sure am glad we are solving that problem. The devastation that could be caused if terrorists started playing bingo instead of blowing up subways could be catastrophic.

It's hard enough to believe someone would even propose such silliness let alone it would receive actual funding. Granted, the amount of funding is small, then again this stupidity all adds up.

Speaking of stupidity adding up, please consider the Bridge to Nowhere.

Sen. Ted Stevens, R-Alaska, sponsored legislation to build a "bridge to nowhere" that would connect Ketchikan, Alaska, to an offshore island where only 50 people live, appears to be indestructible. The highway bill allots $223 million for that project and $229 million for another boondoggle bridge near Anchorage.

Sen. Tom Coburn, R-Okla., violated an unwritten rule when he dared to advance a measure to trim some of his colleagues' expensive and unnecessary pet projects from that bill. Coburn wanted to withdraw funds for the bridges and shift $75 million to rebuild a Louisiana bridge damaged by Hurricane Katrina. It should be a no-brainer that the needs of the devastated Gulf Coast are greater.

Sen. Ted Stevens, R-Alaska, was personally insulted, however. Alaska, which ranks No. 1 in per capita federal spending, was being unjustly singled out, he argued. The 37-year Senate veteran threatened to resign and "be taken out of here on a stretcher" if the Senate killed off perhaps the most egregious example of wasteful spending in the massive highway bill.

Senators were so moved by Stevens' sense of outrage - or the idea that their own pet projects could be next - that they voted 82-15 to keep funding the bridges. The Senate also refused to defund a $500,000 sculpture park in Seattle and $950,000 for a Nebraska museum parking facility.

Those wasteful projects are only a few of the 6,371 "earmarks" legislators pushed into the transportation bill alone.

With our federal highways in a sad state of repair (at least they are around Chicago), I sure am glad we have our priorities straight. I can think of no finer use for transportation funding than a $500,000 Sculpture Park in Seattle. Can you?

Pray tell, what else is buried in that transportation bill? Bah, who cares? It's all borrowed money anyway. Or so says, the Chairman of the President's Advisory Panel on Tax Reform.


Mike Shedlock

Author: Mike Shedlock

Mike Shedlock / Mish
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Mike Shedlock

Michael "Mish" Shedlock is a registered investment advisor representative for SitkaPacific Capital Management. Visit to learn more about wealth management for investors seeking strong performance with low volatility.

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