Hospitals & Asylums
Standard & Poor’s Debt Ceiling and Balanced Budget Amendment Crisis HA-16-7-11
As edited July 26, 2011
By Anthony J. Sanders
Fruitless propaganda between the President and Speaker of the House regarding the federal budget is making me sick. The criminal insanity regarding Nobel laureate President Oma killer and Speaker of the Mother Rapist is too much for my health to bear. Federal hackers have made it clear even the HA U.S. Constitution requires amendment. Lawmakers are threatening our permanent Constitutional record with an AA in my writing class to apologize for their D in my math class, if I do not explain the fine point of the repeal of the Second Amendment by a Balanced Budget Amendment to greet petitioners suing the government for a redress of grievances as politely as the AAA/A+1 rating from Standard and Poor’s that might be downgraded as low as AA if S & P cannot be made to understand that economy actually functions on the HA budget, rather than CBO or OMB budget these days. The problem seems to be that the United States is not capable of reading the Federal Budget in Balance FY 2011: Comparison of Bush and Obama HA-28-2-10, that’s $1,000 license would assure Standard and Poor’s that the United States is in no mathematical danger of defaulting on our debt payments. Even without the inevitable radical nationalization of the health insurance industry, HA has a found that a nearly normal deficit of 3.1% of GDP is achievable in FY 2011 and eases within the reason of a 3% of GDP deficit thereafter if only a few simple and necessary spending limits are imposed on the military and medicine and all the greedy pigs in the Cabinet are impeached and surplus funds returned to the Treasurer. Senator Sanders, a social security support delinquent of $1,000 month himself, must email to the author receipt of the Defense of Social Security Caucus brief HA-1-7-11. The Constitution needs the option of a AAA/A+1 rating for thoroughly repealing paid-off war debts and discrimination as directed by an Optional and Second Optional Protocol to the Balanced Budget Amendment. Perhaps there will be enough HA statute to squeak past the censure of displeasure and amend both the Constitution of the United States of America and the Constitution of Hospitals & Asylums Non-Governmental Economy (CHANGE) this day? There is certainly more than enough gold in my sinuses for immediate national needs.
Gross Federal Debt 2005-2012 (in billions)
2005 / 2006 / 2007 / 2008 / 2009 / 2010 / 2011 / 2012Gross Federal Debt / 7,905 / 8,451 / 8,951 / 9,986 / 11,876 / 13,787 / 15,144 / 16,336
% GDP / 63.5% / 63.9% / 64.4% / 69.2% / 83.4% / 94.3% / 99.0% / 100.8%
Change / 546 / 500 / 1,035 / 1,890 / 1,911 / 1,357 / 1,192
% Change / 6.9% / 5.9% / 11.6% / 18.9% / 16.1% / 9.8% / 7.9%
Federal Reserve Debt / 736 / 769 / 780 / 490 / 769
% GDP / 5.9% / 5.8% / 5.6% / 3.4% / 5.4%
Change / 33 / 11 / -290 / 279
% Change / 4.5% / 1.4% / -37% / 57%
Source: OMB Historical Table 7.1 Federal Debt at End of Year 1940-2015. Table 5 HA-28-2-10
On May 16, 2011, the U.S. government reached its Congressionally mandated ceiling for federal debt of $14,294 billion. The Treasury currently estimates that it will have exhausted these exceptional measures on or about Aug. 2, 2011, at which time it will either have to curtail certain current expenses or risk missing a scheduled payment of interest or principal on Treasury securities held by the public. Standard & Poor (S&P) has placed its 'AAA' long-term and 'A-1+' short-term sovereign credit ratings on the United States of America on CreditWatch with negative implications, owing to the dynamics of the political debate on the debt ceiling, there is at least a one-in-two likelihood that S&P could lower the long-term rating on the U.S. within the next 90 days. S&P may lower the long-term rating on the U.S. by one or more notches into the 'AA' category in the next three months, if S&P conclude that Congress and the Administration have not achieved a credible solution to the rising U.S. government debt burden and are not likely to achieve one in the foreseeable future. The CreditWatch action reflects S&P’s view of two separate but related issues. The first issue is the continuing failure to raise the U.S. government debt ceiling so as to ensure that the government will be able to continue to make scheduled payments on its debt obligations. The second pertains to S&P’s current view of the likelihood that Congress and the Administration will agree upon a credible, medium-term fiscal consolidation plan in the foreseeable future (Nikola et al ’11). It would be shame for the Congress and President to raise the debt ceiling when there is so many hundred billion dollars bills of imaginary debt that could be eliminated because they were nothing but accounting errors from the beginning and were never actually administrated. If the President and Congress cannot appease S&P with their revision of the budget the federal government will be expected to agree on raising the debt ceiling by August 2, 2011.
Department of Treasury Balance 2008-2012 (in millions)
2008 / 2009 / 2010 / 2011 / 2012Treasury OMB / 548,797 / 701,775 / 502,980 / 593,550 / 685,279
% Change / 11.9% / 27.9% / -28.3% / 18.0% / 15.5%
Treasury Operations Budget Justification / 14,582 / 15,591 / 17,002 / 17,500
Treasury Net Interest on Debt / 372,518 / 388,637 / 455,941 / 500,000
Treasury Mandatory Accounts / 511,515 / 1,717 / 90,989 / 91,000
Treasury Total / 896,972 / 400,472 / 560,863 / 600,000
Savings / -195,197 / 102,508 / 32,697 / 85,000
Source: US Treasury. Budget Documents. FY 2011. February 1, 2010 Table 10 HA-28-2-10
The net interest on the debt is not all that much, $450 - $500 billion FY 2011 - 2012. Social security, public health and military are bigger federal expenses. The Treasury Department seems to need some money to reassure S&P that debt limit does not need to be raised. S & P claims to want $4 trillion in collateral. S & P reports that Congress and the Administration are debating various fiscal consolidation proposals. At the high end, budget savings of $4 trillion phased in over 10 to 12 years proposed by the Administration, (separately) by Congressional leaders, as well as by the Fiscal Commission in its December 2010 report, if accompanied by growth-enhancing reforms, could slow the deterioration of the U.S. net general government debt-to-GDP ratio, which is currently nearing 75%. Under S&P’s baseline macroeconomic scenario, net general government debt would reach 84% of GDP by 2013. (Our baseline scenario assumes near 3% annual real growth and a post-2012 phase-out of the December 2010 extension of the 2001 and 2003 tax cuts.) Such a percentage indicates a relatively weak government debt trajectory compared with those of the U.S.' closest 'AAA' rated peers (France, Germany, the U.K., and Canada). S&P expects the debt trajectory to continue increasing in the medium term if a medium-term fiscal consolidation plan of $4 trillion is not agreed upon. If Congress and the Administration reach an agreement of about $4 trillion, and if we to conclude that such an agreement would be enacted and maintained throughout the decade, we could, other things unchanged, affirm the 'AAA' long-term rating and A-1+ short-term ratings on the U.S (Nikola et al ’11). We do not find S & Ps national debt statistics to be very credible as a percentage of GDP OMB projects national debt to exceed 100% by the end of FY 2011. Why is the more than $5 trillion scheduled to be paid as net interest on the debt by the Treasury over the next 10 years, not enough to satisfy S & P’s $4 trillion demand? The answer is because the tax collector is having a shortfall of funds on August 2. Are there no medical or military assets that can be liquidated to appease the Treasury’s insatiable appetite for credit? Why is the Treasurer unable to take of the Revenues to pay the Interest on the National Debt without burdening the National Debt or angering S & P? When will Congress and the President stop the incessant babble of savings over ten years and balance the budget as I have done.
Department of Health and Human Services Spending 2008-2012 (in millions)
2008 / 2009 / 2010 / 2011 / 2012Health and Human Services OMB / 700,442 / 796,267 / 868,762 / 934,426 / 911,291
% Change / 4.2% / 13.7% / 9.1% / 7.6% / -2.5%
HHS Budget Authority / ARRA / 779,419 / 800,271 / 880,861
HHS Recovery Act ARRA Total of 3 yr. spread / 121,315 / 55,087 / 45,162 / 21,066
HHS Budget 3.0% Growth Limit from 2008 / 721,455 / 743,099 / 765,392 / 788,354
HHS Savings 3.0% / -62,686 / 132,860 / 189,127 / 138,134
Source: HHS FY 2011 President’s Budget for HHS. February 1, 2010 Table 16 shortened and recalculated for 3% although 2.5% is a historically more normal rate of spending growth 3% is more significant HA-28-2-10
A $1.5 trillion annual deficit cannot be balanced with $1.5 trillion in savings over ten years, this ten year variable impossibly complicates the difficult task of eliminating the $1.5 trillion deficit, and completely obsesses the body politic, so as to gain absolutely no benefit from the statement to the news media. I am calling for two core spending reductions. The first is simply that military spending, cresting at $711 billion in FY 2011, must be limited to $500 billion for the rest of the decade, for $211 billion savings. The Department of Defense (DoD) is neither an investment nor a research firm and should return treasonous monies to the Treasury. The second is that public health spending has been hopelessly distorted by the Recovery Act and OMB and CBO records of spending on the Department must drop from $911 billion to $733 billion for $138 billion in savings in FY2012. If the Treasury actually needs any money the Treasury should have no trouble getting it from the Department of Health and Human Services (DHHS) who desperately need to stop paying for medical care the patient reports they didn’t like. Medical payments escalated dramatically under the Recovery Act. The Secretary’s actual budget request is much lower than the money credited by OMB. OMB must recognize that the actual spending of HHS is $50 billion less than what OMB estimates. HHS must not be corrupted by the Recovery Act. Nor should tax collectors be corrupted by HHS. We need to go back to 2008 to find a natural rate of public health spending, undistorted by Recovery Act funds the Department never asked for, $700 billion in FY 2008 as a base year. Whereas we have long been disgusted with the greediness of the health sector we have decided to impose a health industry-wide 3% cap on inflation of prices. A 3% annual inflation of public health spending from $700 in base year FY 2008, $765 billion in FY 2011 and $788 billion in FY 2012. In FY 2011 the Secretary spent $881 billion, including Recovery Act distortion, but OMB credited HHS with $934 billion spending. This discrepancy between OMB and CBO is valued at savings of $50 billion if the President and Congress would only listen to reasonable demands of their Secretary. To balance the budget HHS should reduce spending as much as $100 billion to $788 billion. Growth has been wild and completely defies both the law of supply of demand and the law of diminishing returns. $788 billion in FY 2012 would be a better normal for HHS spending recovering from the Recovery Act distortion. Spending could be reduced by enabling Medicare and Medicaid patients the opportunity to refuse to pay for harmful medical treatment and unspent funds and unethical research and subsidies for the rich should be returned to the Treasury thereby enforcing the law of supply and patient demand. Historically and according to the law of diminishing returns increases in the costs of macro-economic government programs should never increase more than 3% annually. Surely between the returns of medical and military overpayments the Treasurer should be able to earn enough money to pay the net interest on the national debt to the satisfaction of the S & P.
Tenth term Congressman Bob Goodlatte from the 6th District of Virginia, submitted H.J. RES. 1 to the 111th Congress on January 6, 2009 when he proposed a three part balanced budget amendment, that would (1) amend the Constitution to require that total spending for any fiscal year not exceed total receipts; (2) require that bills to raise revenues pass each House of Congress by a 2/3 majority; and (3) establish an annual spending cap such that total federal spending could not exceed 18% of the economic output of the United States. H.J. Res. 1 has so far received only 179 sponsors in the House it was by far the most popular of several Proposals for a balanced budget amendment to the Constitution of the United States H.J.RES.78, H.J. RES 89, S.J. RES 22, S.J. RES 27 and S.J. RES 38. Having won the 111th Congress, that failed so miserably to balance the budget that not only the 111th Congress but the Democratic and Republican (DR) duelist system were permanently and totally dissolved, Congressman Goodlatte introduced another balanced budget Constitutional amendment, H.J.Res. 2, that now has 221 cosponsors, and will be introduced after budget negotiations have faltered. The proposed amendments, that might spare the 112th Congress the dignity of being impartially dissolved in the history books, states in its entirety:
Joint Resolution
Proposing a balanced budget amendment to the Constitution of the United States.
Resolved by the Senate and House of Representatives of the United States of America in Congress assembled (two-thirds of each House concurring therein), That the following article is proposed as an amendment to the Constitution of the United States, which shall be valid to all intents and purposes as part of the Constitution when ratified by the legislatures of three-fourths of the several States within seven years after the date of its submission for ratification: