Truth Before Dishonor

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Archive for October 8th, 2011

How Are The Banks Getting Wealthier?

Posted by John Hitchcock on 2011/10/08

Jazz Shaw wrote an article about the increasing Federal spending (despite the Left’s whining claims of “draconian” cuts), which caused me to write my own article on the subject. In doing the research for my article, I found some very interesting data. But it didn’t dawn on me what I found until a couple hours later, when I was playing with my grandson. Then, it was an “Aha!” moment.

According to the Federal Government, the Consumer Price Index rose 3.8 percent for the twelve months ending in August. You can get a 30-year fixed rate mortgage for 3.5 percent, with a 3.772 percent APY. Even if inflation stays at 3.8 percent and doesn’t increase (and I guarantee it will increase by quite a bit in that 30-year window), the bank is losing buying power by writing that mortgage. And that’s before taxes and paying employees. Add in the tax burden and paying employees, and the bank is losing even more. And the bank has to pay interest on the money it borrows that it lends to other people, so the bank is losing yet more.

If the bank made a 100,000 loan with a 3.772 APY, that means, basically, that the bank would gain 3,772 dollars in a year on its 100,000 investment. But a purchase that cost 100,000 would have increased in cost to 103,800 dollars. Meaning the bank’s buying power, with its investment, has actually shrunk.

And the US has either the highest or second highest corporate tax rate in the world, depending on whether Japan went through with its planned corporate tax cuts or not. So that 3,772 dollar profit, which doesn’t even keep up with inflation, gets taxed heavily.

So, how are the banks getting wealthier? Definitely not by writing 30-year mortgages with 3.5 percent interest rates, that’s for certain.

Posted in Conservative, economics, Liberal, media, Obama, politically correct, stereotype, Tax, TEA Party | Tagged: , , | 1 Comment »

RS McCain Interviews US Senate Candidate Ted Cruz (R – TX)

Posted by John Hitchcock on 2011/10/08

RS McCain had an exclusive interview with former Texas Solicitor General Ted Cruz (R), who is running in the Primary for the US Senate seat currently held by Kay Bailey Hutchison (R – TX), at the Values Voter Summit.

Since RS McCain was very busy with the Summit and catching people to interview, he requested his readers to transcribe a couple of his interviews for him, which I was only too happy to do on this one.

McCain: We’re here at the Values Voters Summit in Washington, DC, with Ted Cruz, former Solicitor-General of Texas. How are you today, Mr Cruz?

Cruz: Doing fantastic, Robert.

McCain: And I understand you’re running for Senate.

Cruz: I am, running for US Senate in Texas, and we have seen some incredible momentum and excitement. We’ve really seen Conservatives across the state of Texas and nationally uniting behind our campaign.

McCain: And as some people have compared you to Marco Rubio, as the “Marco Rubio of Texas”, you are yourself also Cuban.

Cruz: Well, that’s right. And that’s an incredibly kind comparison. Marco and I share a very similar personal story, which is that my dad is from Cuba, he was born there, he grew up there, and he was imprisoned and tortured in Cuba as a teenager when he was 17. And he fled Cuba, he came to the United States. When he was 18, he showed up in Austin. Had no money, didn’t speak English, had 100 dollars sewn into his underwear, and he went and got a job as a dishwasher making 50 cents an hour. And he worked 7 days a week and he paid his way through school at the University of Texas. And I’ll tell you, Robert, when I was a kid my dad used to say to me all the time, “when we faced depression in Cuba, I had a place to flee to. If we lose our freedom here, where do we go?” And there’s no question that better explains why it is I’m running for Senate than that question right there.

McCain: And so your website is?

Cruz: It’s and we’re also on FaceBook. We’ve got over 64,000 supporters on FaceBook nationwide. What we are doing is building a Conservative TEA Party Army all across Texas and all across the country. And we have seen tremendous support. Just this week, National Review magazine made the very generous decision to put our campaign on the cover of the magazine. And I’ll tell you, Robert, the last US Senate candidate who they put on the cover was Marco Rubio almost exactly two years ago. And it worked out pretty well the last time. I hope we see the same result here.

McCain: Alright, well good luck to you, Ted Cruz. That’s

Cruz: That’s it.

McCain: Alright, thank you.

RS McCain is definitely in Cruz’ corner, as is Senator Jim DeMint. Jazz Shaw at Hot Air (who linked to RS McCain’s interview and quoted part of my transcription (woohoo)) seems to think Cruz may well be a strong Republican up-and-comer. And Instapundit thought well enough of the Ted Cruz interview that he gave RS McCain an Instalanche.

As Jazz Shaw said, “It’s probably worth your time to check him out.” And I believe I have found who I will be voting for in the US Senate Primary in Texas next year.

Posted in Conservative, Elections, Over-regulation, Personal Responsibility, Philosophy, Politically Incorrect, politics, society, TEA Party | Tagged: , , , | Comments Off on RS McCain Interviews US Senate Candidate Ted Cruz (R – TX)

About Those “Draconian” Spending Cuts

Posted by John Hitchcock on 2011/10/08

As most Americans expected, they didn’t happen. According to the CBO, Federal spending increased by 4.2 percent in Fiscal Year 2011 over Fiscal Year 2010. So, all that Democrat screaming about all those horrible and draconian spending cuts didn’t actually happen. What a surprise.

Jazz Shaw reports:

We still have a long way to go in sorting out the pressing issues facing the nation, and we don’t all agree on the solutions. Foreign policy questions abound, our energy policy is a mess and we still need to bring down those unemployment numbers. But at least there’s one thing we’ve managed to nail down, and that’s spending. Everyone figured out that we have to cut costs and stop running up the deficit, leading us to take quick, substantive action. So… how’s that working out for you? According to the latest CBO report… meh.

Defense spending, where Democrats look first for any cutting? It increased a lethargic 1 percent, as did Medicaid spending. Social Security and Medicare, on the other hand, increased 4 percent, according to The Hill’s reporting. That would mean none of those four even reached the total Federal Budget increase of 4.2 percent. So where was the huge increase?

According to the OMB, Defense spending in 2010 accounted for 19 percent of the Federal Budget, Social Security was 20.4 percent, and Medicare and Medicaid combined for another 19 percent. That means an entire 58.4 percent of the Federal Budget fell below the overall increase in Budget spending, large chunks of it well below. That really leaves only interest on the debt and non-defense discretionary spending as places to look for the major increases in spending. And the interest rate is near zero, record-low territory.

All these draconian cuts? Didn’t happen. All these draconian cuts in non-defense discretionary spending? Absolutely didn’t happen. But, hey, maybe the Federal Government increased spending by less than the inflation rate? We can hope. Oh well, that hope would be dashed. According to the Federal Government, the Consumer Price Index rose by 3.8 percent in the 12 months ending in August. That would mean that, while Defense spending didn’t come close to matching inflation, the overall Federal Budget increased faster than inflation. And as I’ve shown, non-defense discretionary spending necessarily increased much faster. Draconian cuts in non-defense discretionary spending? That was a big lie.

And here’s a real kicker for people putting money in savings accounts. You can get 1 percent interest on your money. That means, if you put 10 dollars in a savings account last year, it would be 10 dollars and 10 cents now. But what cost 10.00 last year costs 10.38 this year. Your ten bucks you saved and got interest on just lost 28 cents in buying power, so you’re 28 cents worse off than when you started. But then again, you get the added pleasure of paying taxes on that dime you got in interest. So you’re actually worse off than that 28 cent loss in buying power.

All while the government keeps spending more and more while claiming to make “draconian” cuts.

Posted in economics, Elections, Liberal, media, Obama, politically correct, politics, society, Tax, TEA Party | Tagged: , , , , , | 3 Comments »

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