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Spending Daily January 17, 2013

WASTE: Interior Secretary’s Bathroom Cost Taxpayers $222,000 ABC reports, “Maybe the Pentagon’s legendary $600 toilet seat was a bargain. The personal bathroom used by the secretary of the Interior is so swanky that its renovation cost $222,000. No detail was overlooked: It has a $3,500 sub-zero refrigerator (hey, if you’re going to have a fridge in the bathroom, it might as well be a good one) and a $689 faucet.



Spending Daily | January 17, 2013

WASTE: Interior Secretary’s Bathroom Cost Taxpayers $222,000
ABC reports, “Maybe the Pentagon’s legendary $600 toilet seat was a bargain. The personal bathroom used by the secretary of the Interior is so swanky that its renovation cost $222,000. No detail was overlooked: It has a $3,500 sub-zero refrigerator (hey, if you’re going to have a fridge in the bathroom, it might as well be a good one) and a $689 faucet. At least the ‘vintage tissue holder’ was cheap: just $65 bucks. The renovation was done in 2007 under President George W. Bush’s Interior Secretary Dirk Kempthorne, but is only now coming to light, thanks to the dogged reporting by ABC News Atlanta affiliate WSB-TV, which first filed a Freedom of Information Act request on the renovation four years ago. The renovations were the subject of an internal audit by the General Services Administration, which has responsibility for most federal government properties. In a classic bureaucratic understatement, the audit report noted, ‘A number of the items incorporated into the renovation project call into question the need for luxurious materials.’” Read more on Bankrupting

McKeon: More Warning Needed on Sequester, “perfect storm brewing” for More Than One Year
The Hill reports, “The Joint Chiefs of Staff warned congressional leaders that a multitude of budget problems the federal government is facing could create a ‘hollow force’ unless Congress takes action. In a letter to Armed Services Committee leaders obtained by The Hill, the seven members of the Joint Chiefs said that the combination of across-the-board cuts through sequestration and the prospect of a continuing resolution through the end of the year could cut 20 percent from the Joint Forces compared to the president’s budget. … The Pentagon could be cut roughly $45 billion in the last seven months of fiscal 2013. … ‘I only wish the service chiefs’ warning had come sooner. For well over a year we have seen this perfect storm brewing.'” said House Harmed Services Committee Chairman Buck McKeon.

“Promises, Promises: Obama Curbs Ambition This Time”
Calvin Woodward of the Associated Press writes, “Despite a relentless workload ahead, President Barack Obama is lighter on his feet in one sense as he opens his second term. Gone are the hundreds of promises of the past. He’s toting carry-ons instead of heavy cargo this time. Obama’s first presidential campaign and the years that followed were distinguished by an overflowing ambition, converted into a checklist of things he swore to do. … [D]eficits have shot up, not dropped by half as he pledged in his 2008 campaign and again as president when the recession was raging. That inherited recession, the halting recovery and his heavy spending to spur growth yielded four straight years of trillion-dollar deficits.”

Gallup: Employment “Deteriorates” In January
Gallup reports, “The U.S. Payroll to Population employment rate (P2P), as measured by Gallup, deteriorated steadily in early January. P2P fell to 43.7% on Jan. 15, based on a 30-day rolling average, from 44.1% for the 30 days ending Jan. 3, the first reading for 2013. The P2P rate is also lower compared with the same time last year, when it was in the low 44% range. … U.S. unemployment, as measured by Gallup without seasonal adjustment, is 8.0% in mid-January, worsening from 7.7% on Jan. 3 and 7.7% for the month of December. However, the unadjusted unemployment rate remains lower than that of January 2012.”

GOP Pushes Federal Pay Freeze Extension
The Washington Post reports, “It’s not surprising that House Republicans are continuing their assault on federal employee compensation. But Majority Leader Eric Cantor’s decision to quickly call for a vote on a new bill shows just how strong their determination is to hold down federal pay. … No sooner had Rep. Ron DeSantis (R-Fla.) and 28 co-sponsors introduced H.R. 273 on Wednesday than Cantor (R-Va.) announced a vote for next week. The measure would extend the freeze on basic pay rates until the end of the year. ‘At a time when we should be focused on helping families get on solid financial footing, members of Congress, the vice president, Cabinet secretaries and federal employees don’t need a raise,’ Cantor said. ‘This across-the-board pay hike issued by President Obama through executive order will cost hardworking taxpayers $11 billion. . . . We simply can’t afford it.'”

Incoming Senate Budget Committee Chair Pushes For Higher Taxes
Senator Patty Murray writes for POLITICO, “Republicans are claiming that we got all the revenue we needed from the year-end deal and now we should only focus on cutting spending and entitlements — but that is simply wrong. The year-end deal raised $600 billion from the wealthiest Americans on top of the $1.5 trillion we cut in spending over the past two years, which is approaching a 3-to-1 ratio of spending cuts to revenue increases. If we replace sequestration with cuts alone, that ratio will jump to 4-to-1, which is far higher than ratios recommended by the bipartisan groups that have examined the issue. … So we need to replace sequestration with an equal mix of revenue and responsible spending cuts — and finding that revenue shouldn’t be too difficult. We all know that our Tax Code is riddled with giveaways for the wealthiest Americans and biggest corporations.”

Obama Standing Firm on Debt Ceiling
The Associated Press reports, “President Barack Obama is assembling an ambitious second-term agenda, pushing aggressively where he thinks he has political leverage but moving more cautiously on issues where he has less control. Obama is hiking pressure on congressional Republicans on the debt ceiling and immigration, two big issues in which public sentiment and political risks seem to favor him. His refusal to negotiate on the debt ceiling is an especially sharp departure from his usually accommodating style. Obama is gambling that Republicans will yield to fears of a ferocious public backlash if they leave the government unable to pay its bills in their push for spending cuts.”

Some Argue Prioritizing Payments Can’t Be Done
According to The Hill, “Experts argue that proposals to prioritize payments in the event of a debt-ceiling breach would be nearly impossible to carry out. Experts are dismissing Republican proposals to prioritize federal payments in the event of a debt-ceiling breach, arguing they would be nearly impossible for the Obama administration to carry out. A growing number of Republicans are looking to sap the drama from the debt-ceiling fight by pushing measures they say would protect the country from the most damaging aspects of hitting the borrowing limit. … At a press conference on Monday, Obama rattled off a series of negative consequences that he said could come if Congress failed to raise the debt limit in time. Social Security checks, veterans’ benefits and military pay could be delayed, the president declared, and investors would begin to question America’s reputation as a safe haven. But some Republicans believe the president and his allies are chanting doom and gloom to paint the GOP as an economic saboteur.”

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Wealth is not Created at the Top: It is Only Devoured There



The UK has left the EU and we can argue about the minutiae of Wealth until we’re blue in the face. But the overriding factors are apparent and in one of the richest countries in the world it is shocking that so many people can’t even be sure if they are going to be able to eat enough today or provide for their loved ones.

These days, politicians from the left to the right assume that most wealth is created at the top. By the visionaries, by the job creators, and by the people who have “made it”. By the go-getters oozing talent and entrepreneurial-ism that are helping to advance the whole world – Opinion by 


… across the spectrum virtually all agree that wealth is created primarily at the top and so entrenched is this assumption that it’s even embedded in our language. When economists talk about “productivity”, what they really mean is the size of your paycheck. And when we use terms like “welfare state”, “redistribution” and “solidarity”, we’re implicitly subscribing to the view that there are two strata: the makers and the takers, the producers and the couch potatoes, the hardworking citizens – and everybody else.

Bankers, pharmaceutical giants, Google, Facebook … a new breed of  rentiers are at the very top of the pyramid and they’re sucking the rest of us dry


In reality, it is precisely the other way around. In reality, it is the waste collectors, the nurses, and the cleaners whose shoulders are supporting the apex of the pyramid. They are the true mechanism of social solidarity. Meanwhile, a growing share of those we hail as “successful” and “innovative” are earning their wealth at the expense of others. The people getting the biggest handouts are not down around the bottom, but at the very top. Yet their perilous dependence on others goes unseen. Almost no one talks about it. Even for politicians on the left, it’s a non-issue.

To understand why, we need to recognise that there are two ways of making money. The first is what most of us do: work. That means tapping into our knowledge and know-how (our “human capital” in economic terms) to create something new, whether that’s a takeout app, a wedding cake, a stylish updo, or a perfectly poured pint. To work is to create. Ergo, to work is to create new wealth.


But there is also a second way to make money. That’s the rentier way: by leveraging control over something that already exists, such as land, knowledge, or money, to increase your wealth. You produce nothing, yet profit nonetheless. By definition, the rentier makes his living at others’ expense, using his power to claim economic benefit.

But here comes the rub. Most rentiers are not as easily identified as the greedy banker or manager. Many are disguised. On the face of it, they look like industrious folks, because for part of the time they really are doing something worthwhile. Precisely that makes us overlook their massive rent-seeking…


The problems we face are that the politicians are firmly in the hands (pockets) of the uber wealthy. We live in a corporate plutocracy and those holding all the wealth and therefore power have no intention of changing the status quo, even if it isn’t sustainable. They remind me of bacteria (or cancer) devouring the host body more and more even though eventually it will kill them too.

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Donald Trump Forgets Important Lesson From Grandad:




Harper’s Magazine reprints an interesting letter from US President Donald J. Trump’s own grandfather that may get you thinking. Here is it then:

The Emigrants – By Friedrich Trump – From a letter written in 1905 by Friedrich Trump, Donald Trump’s grandfather, to Luitpold, prince regent of Bavaria. Trump had been ordered to leave Bavaria for failing to complete mandatory military service and to register his initial emigration to the United States twenty years earlier.


Prince Luitpold rejected Trump’s request for repatriation; the family later settled in New York. Translated from the German by Austen Hinkley.

Most Serene, Most Powerful Prince Regent! Most Gracious Regent and Lord!

I was born in Kallstadt on March 14, 1869. My parents were honest, plain, pious vineyard workers. They strictly held me to everything good — to diligence and piety, to regular attendance in school and church, to absolute obedience toward the high authority.

After my confirmation, in 1882, I apprenticed to become a barber. I emigrated in 1885, in my sixteenth year. In America I carried on my business with diligence, discretion, and prudence. God’s blessing was with me, and I became rich. I obtained American citizenship in 1892. In 1902 I met my current wife. Sadly, she could not tolerate the climate in New York, and I went with my dear family back to Kallstadt.

The town was glad to have received a capable and productive citizen. My old mother was happy to see her son, her dear daughter-in-law, and her granddaughter around her; she knows now that I will take care of her in her old age.

But we were confronted all at once, as if by a lightning strike from fair skies, with the news that the High Royal State Ministry had decided that we must leave our residence in the Kingdom of Bavaria. We were paralyzed with fright; our happy family life was tarnished. My wife has been overcome by anxiety, and my lovely child has become sick.

Why should we be deported? This is very, very hard for a family. What will our fellow citizens think if honest subjects are faced with such a decree — not to mention the great material losses it would incur. I would like to become a Bavarian citizen again.

In this urgent situation I have no other recourse than to turn to our adored, noble, wise, and just sovereign lord, our exalted ruler His Royal Highness, highest of all, who has already dried so many tears, who has ruled so beneficially and justly and wisely and softly and is warmly and deeply loved, with the most humble request that the highest of all will himself in mercy deign to allow the applicant to stay in the most gracious Kingdom of Bavaria.

Your most humble and obedient,

Friedrich Trump

… Well then. Long ago, yes.. Still applies? You tell me.

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