December 21, 2012

NATIONAL REVIEW
Inside the Meltdown
by Robert Costa
December 21, 2012

At a quarter to 8 p.m. on Thursday night, House Republicans gathered in the Capitol basement for an urgent, closed-door conference meeting. The scene was hushed and confused. Instead of huddling in a windowless room, members thought they’d spend the evening on the House floor, voting on “Plan B,” Speaker John Boehner’s fiscal-cliff proposal. But as they took their seats and looked at Boehner’s face, the reason for the gathering became clear: The speaker didn’t have the votes. The whipping was over. “Plan B” was dead.

Boehner’s speech to the group was short and curt: He said his plan didn’t have enough support, and that the House would adjourn until after Christmas, perhaps even later. But it was Boehner’s tone and body language that caught most Republicans off guard. The speaker looked defeated, unhappy, and exhausted after hours of wrangling. He didn’t want to fight. There was no name-calling. As a devout Roman Catholic, Boehner wanted to pray. “God grant me the serenity to accept the things I cannot change,” he told the crowd, according to attendees.

There were audible gasps of surprise, especially from freshman lawmakers who didn’t see the meltdown coming. Boehner’s friends were shocked, and voiced their disappointment so the speaker’s foes could hear. “My buddies and I said the same thing to each other,” a Boehner ally told me later. “We looked at each other, rolled our eyes, and just groaned. This is a disaster.”

Representative Mike Kelly of Pennsylvania, a burly former car dealer, stood up and urged the conference to get behind the speaker. “How the hell can you do this?” Kelly asked, according to several people inside the room. A few of Boehner’s critics told Kelly to stop lecturing, but most were silent. They had been battling against “Plan B” all week, and quite suddenly, they had crippled the leadership. Boehner sensed the tension, requested calm, and then exited the room.

Since the meeting lasted only a few minutes, several members, such as Representative Tim Huelskamp of Kansas, missed the session. As Huelskamp, a leading “Plan B” adversary, rushed to get there, he saw a stream of his colleagues exiting. They were on their phones with aides and family members, sharing the news. They’d be coming home for the holidays since the House was in a state of chaos. Some of them, however, seemed bewildered by the turn of events. They walked slowly down the basement hallway, whispering with other members. One freshman asked a senior member, “Are we really not coming back?” The senior member simply nodded. Almost everyone avoided the press. Feelings were raw. Representative Steve King of Iowa, a frequent Boehner critic, looked at me, shook his head, and said, “I have nothing to say.”

Boehner and his leadership team soon departed. Kevin McCarthy, the GOP whip, who hours earlier was meeting with on-the-fence members over Chick-fil-A sandwiches in his office, left the Capitol looking distressed. So did Eric Cantor, the majority leader, who had spent the past two days wooing backbenchers. Representative Paul Ryan of Wisconsin, the Budget Committee chairman and recent Republican vice-presidential candidate, strolled out of the Capitol with Representative Tom Price of Georgia, a popular conservative who has expressed his unhappiness with Boehner’s cliff strategy. The pair declined to discuss the drama, but they both looked tired and frustrated.

Read more: http://goo.gl/xwElu

THE CATO INSTITUTE
Behind the Smears
by Walter Olson
December 20, 2012

Here’s something you may not know about the 1987 battle that kept Robert Bork off the Supreme Court: Opponents pursued a whispering campaign against him on the grounds that he wasn’t enough of a religious believer.

Back then, many Democrats still held seats in the rural South, and the religion angle gave them an easier way to explain their stance to constituents than, We’ve been asked to oppose him as a party-line matter.

Thus Rep. John Bryant (D-Texas) warned that Bork was “an agnostic who is not a member of any church.”

And Sen. Bennett Johnston (D-La.), while disclaiming any “religious test for judges,” advised “fundamental religious people” back home to “look, in addition to what he has written, at [Bork’s] statements on morals or lack thereof — and I don’t mean to suggest he is immoral — but his lack of occupation with morals and with religion.”

“Never in memory had a judicial nomination

been fought in such language. Why?”

Sen. Howell Heflin (D-Ala.) told constituents he was “disturbed by [Bork’s] refusal to discuss his belief in God — or the lack thereof.” Heflin also alluded darkly to the nominee’s beard and “strange lifestyle” as a Yale law professor.

Judge Robert Bork died yesterday at 85, and as one of the smartest persons ever nominated to the high court — George Will called him ‘the most intellectually distinguished nominee since Felix Frankfurter’ — he was well situated to appreciate the many historical ironies.

One was that opponents like Heflin could exploit prejudice against him as a former Yale law professor and presumed Northeastern elitist. In fact his views were so far from his former colleagues’ that in later years he was to joke of seeing a bumper sticker that read, Save America. Close Yale Law School.

The religious angle adds another irony. Particularly after his defeat and retirement from the bench, Bork’s views drifted steadily rightward; in the wake of his best-selling 1997 book Slouching Toward Gomorrah, he became a favorite of “secularism is destroying America” culture warriors.

Of course the confirmation critique that makes it into every Bork obituary isn’t Heflin’s or Johnston’s. It’s Ted Kennedy’s blowhard caricature, intended for northern liberal consumption, of “Robert Bork’s America” as “a land in which women would be forced into back alley abortions, blacks would sit at segregated lunch counters, rogue police could break down citizens’ doors in midnight raids, school children could not be taught about evolution,” and so on.

Never in memory had a judicial nomination been fought in such language. Why?

As a constitutional law scholar, Bork had distinguished himself even among conservatives for his scathing critique of the Warren Court, which he accused essentially of having made up constitutional law as it went along.

To organized liberal groups, on whose behalf Kennedy was acting, this was the next thing to a declaration of war. Yet they couldn’t exactly come out and defend making up constitutional law as you went along as their own vision for the high court.

Instead, they served up a steady diet of vitriol and wild oversimplification, especially in TV ads and other messages delivered outside the confirmation hearings.

The Washington Post itself opposed Bork’s confirmation, yet nonetheless editorialized against the “intellectual vulgarization and personal savagery” to which some of his opponents had descended, “profoundly distorting the record and the nature of the man.”

Once “Borking” had been coined as a word and as a practice, it didn’t take long for nominees of both sides to pay the price. Some didn’t care to put themselves or their families through months of mudslinging.

Within a few years, presidents of both parties were taking care to pick nominees with schmoozy as opposed to prickly personalities — and willing to submit to coaching on how to give off that oh-so-important empathetic vibe without actually committing to anything.

Read more: http://goo.gl/zIGfR

AMERICAN THINKER
How to Downsize the Federal Government
by Bill Weckesser
December 21, 2012

Maybe Republicans need go back to the Gipper's playbook on the deficit. Reagan once said, "I'm not worried the deficit. It's big enough to take care of itself." He certainly had a point. Reagan was charged with massively increasing spending and borrowing on defense so that liberals would be sort of handcuffed from any big new spending programs for a while. And, arguably, for a while it may have worked.

Now the New York Times laments-in an article I found at CNBC-that instead of defense, entitlements are swallowing all the money.

Consider the president's budget, which by law must include projections of taxing and spending over the next decade. Loath to raise taxes on the middle class yet unwilling to cut deeply into the budgets for Social Security or Medicare, the president and his advisers proposed cutting the discretionary part of the budget devoted to everything except defense and other security agencies to 1.7 percent of economic output by 2022, down from 3.1 percent last year. 

This is not irrelevant spending. It accounts for every government expenditure except entitlements, security and interest. It pays subsidies for higher education and housing assistance for the poor. It finances the National Institutes of Health and the Food and Drug Administration. It pays for the Federal Emergency Management Agency and training programs for unemployed workers. Without such spending, the government becomes little more than a heavily armed pension plan with a health insurer on the side.
House Republicans are equally if not more frugal. The House budget resolution, the Republicans' last detailed proposal about taxes and spending, refers to discretionary spending except national defense, a broader category than that considered in the president's budget. They too cut it to the bone: to about 2.1 percent of economic output in 2022, from 4.3 percent last year. 

To put it in perspective, this would cut the government's civilian discretionary budget to the smallest it has been as a share of the economy at least since the Eisenhower administration -- when a quarter of the population lived under the poverty line, thousands of children still contracted polio each year and fewer than one in 12 Americans older than 25 had a college degree. According to estimates by the Congressional Budget Office, even going over the so-called fiscal cliff would not cut it as deeply.

Hey, the Eisenhower years weren't so bad. This could be a road back.

Conservatives need to turn the table on the debate. Instead of arguing that entitlements will soon swallow everything else, so let's cut them, let's work on cutting all the rest. House republicans should consider making every cut a tradeoff versus cutting Social Security/Medicare. For instance, either downsize the EPA...or cut Social Security/Medicare. Reduce the Energy department...or reduce Social Security/Medicare. Scale back the Department of Education...or trim Social Security/Medicare. The list is endless. A lot of Americans have more affection for Social Security/Medicare than any government agency. This could be a stealth way to pursue some healthy de-regulation. Would this meaningfully reduce the deficit? Of course not.

But, to paraphrase Reagan, "entitlements are a big enough problem to take care of themselves." In the meantime, maybe conservatives can win some other battles

Read more: http://goo.gl/USzE5

December 20, 2012

THE WALL STREET JOURNAL
America's Dangerous Powerball Economy
by Arthur Brooks
December 19, 2012

What can the state lottery teach us about how to deal with the fiscal cliff? Quite a bit, actually.

Last month, two families in Missouri and Arizona had their dreams come true when they shared the largest Powerball lottery jackpot in history: $587 million. "We are truly blessed," one of the winners told the press.

Perhaps. People always imagine all the nice things that would happen to them if they won the lottery: They would travel more, buy a beautiful home, start a foundation or quit a tiresome job. Rarely do people say, "If I won the lottery, I'd marry somebody who doesn't love me, buy a bunch of things I don't really want, and then start an ugly alcoholic spiral."

But hitting the jackpot generally leads to unhappiness. A famous 1978 study of major lottery winners in the Journal of Personality and Social Psychology showed that while the winners experienced an immediate happiness boost right after winning, it didn't last. Within a few months, their happiness levels receded to where they had been before winning. As time passed, they found they were actually less happy than they had been before winning.

Does this suggest that money makes us unhappy? Not at all. There is a huge amount of research showing that money, when earned, has a generally positive association with happiness. The problem is when it is unearned, when raw purchasing power is untethered from hard work and merit. Above basic subsistence, happiness comes not from money per se, but from the value creation it is rewarding.

The University of Chicago's General Social Survey reveals that people are twice as likely to feel "very happy" about their lives if they feel "very successful" or "completely successful" at work, rather than "somewhat successful." The differences persist whether they earn more or less income.

Entrepreneurs of all types rate their well-being higher than do members of all other professional groups in America, according to years of polling by the Gallup organization. And it's not because of the money. The employment website CareerBuilder.com reported in 2011 that small business owners made 19% less per year than government managers.

While earned success facilitates the pursuit of happiness, unearned transfers generally impede it. According to the Panel Study of Income Dynamics, going on the welfare rolls increases by 16% the likelihood of a person saying he or she has felt inconsolably sad over the past month (even after controlling for poverty and unemployment). A study by economist John Ifcher at Santa Clara University shows that single mothers who were required by the 1990s welfare reform to work for their benefits—and therefore lost leisure time, had to find child care and the like—were still significantly happier about their lives after the reforms than before.

All this data relates to our policy debates because every year, fewer and fewer people earn their way in America without a government subsidy. As my colleague Nicholas Eberstadt has written, entitlements have doubled as a percentage of the ballooning federal budget since 1960. Today, more than half of American households receive government transfer benefits.

And this isn't just a case of senior citizens taking the Social Security they have paid for. Unearned transfers are exploding. Consider that the number of Americans receiving disability benefits has increased almost 20-fold since 1960, to 8.6 million today from 455,000. The Tax Foundation notes that nearly 70% of Americans now take more out of the tax system than they pay into it.

It is a simple fact that the United States is becoming an entitlement state. The problem with this is not just that it is bankrupting the country. It is that the entitlement state is impoverishing the lives of the growing millions dependent on unearned resources. The good news is that we have a golden opportunity to rein in entitlements, for the first time in many years.

But there is bad news, too. President Obama argues that the real problem is undertaxing the public, not overspending on entitlements. He is currently asking Congress for $1.3 trillion in tax increases over a decade but less than $1 trillion in spending cuts—largely deferred, meaning much of that may not even take place. A study by Ernst & Young shows that Mr. Obama's proposed tax hikes would force small businesses to eliminate about 710,000 jobs.

Mr. Obama's proposal suggests he is entirely comfortable with an entitlement state. His telling entrepreneurs that they weren't responsible for their success on the specious grounds that government was responsible for the country's infrastructure—"You didn't build that"—wasn't just an inartful turn of phrase. It implied he is blind to the moral difference between what is earned and what is unearned.

Before us today is a chance to improve the true welfare of our nation while changing our overspending ways. By reforming entitlements and the tax system instead of extracting more money with higher tax rates, the economy could be reoriented away from unearned transfers to earned wages. This would make the economy fairer and sounder. And in the process it could build a happier country for ourselves and our children.

Read more: http://goo.gl/nYVqT

AMERICAN THINKER
A Crack in Obama's Armor?
by Matt C. Abbott
December 20, 2012
Just when you're about to give up entirely on the federal courts, a small sign of hope emerges.

From The Becket Fund for Religious Liberty:

Today [Dec. 18], a federal appeals court in Washington, D.C. handed Wheaton College and Belmont Abbey College a major victory in their challenges to the HHS mandate. Last summer, two lower courts had dismissed the Colleges' cases as premature. Today, the appellate court reinstated those cases, and ordered the Obama Administration to report back every 60 days-starting in mid-February-until the Administration makes good on its promise to issue a new rule that protects the Colleges' religious freedom. The new rule must be issued by March 31, 2013.... 

'This is a win not just for Belmont Abbey and Wheaton, but for all religious non-profits challenging the mandate,' said [Kyle Duncan, general counsel of The Becket Fund for Religious Liberty]. 'The government has now been forced to promise that it will never enforce the current mandate against religious employers like Wheaton and Belmont Abbey and a federal appellate court will hold the government to its word.'

A win? Perhaps. Still, I think it's a bit premature to declare victory. One can hope that these legal challenges to the HHS mandate are making the Obama administration sweat a little, so to speak. Or maybe the president will actually have a pang of conscience. After all, the least he can do is allow for authentic religious freedom here in the United States of America.

As Pope Benedict XVI recently stated, religious freedom is a fundamental human right. (Granted, I'm not holding my breath that the president will embrace the pope's wisdom.) In his message for the 46th World Day of Peace on Dec. 14, the pope said:

'One of the fundamental human rights, also with reference to international peace, is the right of individuals and communities to religious freedom. 

'At this stage in history, it is becoming increasingly important to promote this right not only from the negative point of view, as freedom from-for example, obligations or limitations involving the freedom to choose one's religion-but also from the positive point of view, in its various expressions, as freedom for-for example, bearing witness to one's religion, making its teachings known, engaging in activities in the educational, benevolent and charitable fields which permit the practice of religious precepts, and existing and acting as social bodies structured in accordance with the proper doctrinal principles and institutional ends of each. 

'Sadly, even in countries of long-standing Christian tradition, instances of religious intolerance are becoming more numerous, especially in relation to Christianity and those who simply wear identifying signs of their religion.'

Read more: http://goo.gl/8DGSs

NATIONAL REVIEW
The New Racial-Derangement Syndrome
by Victor Davis Hanson 
December 20, 2012

There is a different sort of racialist derangement spreading in the country — and it is getting ugly.

Here is actor Jamie Foxx joking recently about his new movie role: “I kill all the white people in the movie. How great is that?” Reverse white and black in the relevant ways and even a comedian would hear national outrage. Instead, his hip Saturday Night Live audience even gave Foxx applause.

Race-obsessed comedian Chris Rock tweeted on the Fourth of July, “Happy white peoples [sic] independence day . . . ”

Actor Samuel L. Jackson, in a recent interview, sounded about as unapologetically reactionary as you can get: “I voted for Barack because he was black. . . . I hope Obama gets scary in the next four years.”
No one in Hollywood used to be more admired than Morgan Freeman, who once lectured interviewers on the need to transcend race. Not now, in the new age of racial regression. Freeman has accused Obama critics and the Tea Party of being racists. He went on to editorialize on Obama’s racial bloodlines: “Barack had a mama, and she was white . . . very white, American, Kansas, middle of America . . . America’s first black president hasn’t arisen yet.”

Freeman’s racial-purity obsessions were echoed on the CNN website, where an ad for the network’s recent special report on race included a crude quote from three teen poets: “Black enough to be a n. White enough to be a good one.”

In the 21st century, are we returning to the racial labyrinth of the 19th-century Old Confederacy, when we measured our supposed racial DNA to the nth degree? Apparently, yes. ESPN sports commentator Rob Parker blasted Washington Redskins quarterback Robert Griffin III last week for admirably stating that he did not wish to be defined by his race rather than by his character: “He’s black, he does his thing, but he’s not really down with the cause.” Parker added: “He’s not one of us. He’s kind of black, but he’s not really like the kind of guy you really want to hang out with.” (ESPN suspended Parker for his remarks.)

Unfortunately, the new racialist derangement is not confined to sports and entertainment. The Reverend Joseph Lowery — who gave the benediction at President Obama’s first inauguration — sounded as venomous as the Reverend Jeremiah Wright in a speech that Lowery delivered to a black congregation shortly before this year’s election: “I don’t know what kind of a n***** wouldn’t vote with a black man running.” Lowery reportedly preceded that rant by stating that when he was younger, he believed that all whites were going to hell, but now he merely believes that most of them are. And in his 2009 inauguration prayer, Lowery ended with his hopes for a future day when “white will embrace what is right.”

Wasn’t Obama’s election supposed to mark a new post-racial era? What happened?

Read more: http://goo.gl/IGO7b

November 27, 2012

NEWSMAX

Fiscal Cliff in U.S. Raises Risk of Global Recession, OECD Says

by Bloomberg News

November 27, 2012

Failure to prevent the so-called fiscal cliff in the U.S. would increase the risk of a global recession, the Organization for Economic Cooperation and Development said, while adding that the “greatest threats” to the world economy lie in the euro area.

“If the fiscal cliff is not avoided, a large negative shock could bring the U.S. and the global economy into recession,” the Paris-based OECD said in its Economic Outlook report released today.

As the administration of President Barack Obama prepares to negotiate a budget agreement with Republicans in Congress, the OECD urged “smooth” implementation of tax increases, spending curbs and a higher debt ceiling in the medium term.

“Reducing the large federal budget deficit is necessary to restore fiscal sustainability, but this should be done gradually and in the context of a well-identified medium-term consolidation plan,” today’s report said.

The fiscal cliff refers to the $607 billion in federal spending cuts and tax increases scheduled to take effect early next year unless Congress acts. Treasury Secretary Timothy F. Geithner said Nov. 16 the deadlock can be resolved “within several weeks” while the uncertainty it has created “already is having an effect on consumer confidence and the economy.”

Absent the automatic spending cuts and most of the tax increases currently set to take effect next year, the U.S. federal deficit would come to $1.04 trillion in fiscal year 2013, the fifth consecutive year of budget gaps exceeding $1 trillion, according to the non-partisan Congressional Budget Office.

Europe Crisis

The OECD report also said it is “urgent” to solve Europe’s debt crisis.

“In the euro area, where the greatest threats to the world economy remain, progress in adjustment and in strengthening institutions has been significant over the recent past,” the OECD said. “However, challenging fiscal sustainability conditions in some countries risk sparking a chain of events that could considerably harm activity in the monetary union and push the global economy into recession.”

A “major financial event” in the euro zone “would spill over into the rest of the global economy, including the United States,” Pier Carlo Padoan, OECD chief economist, said during a conference call with reporters yesterday.

Federal Reserve

The Federal Reserve should stand ready to enlarge its third round of quantitative easing program if the U.S. economy deteriorates, the OECD said.

“If the economic situation were to turn out significantly worse than expected, the Federal Reserve should further expand the size of its purchases of government and mortgage-backed securities and start purchasing other types of assets if necessary to ease financial conditions,” according to today’s report.

Read more: http://goo.gl/5D57A

THE WALL STREET JOURNAL

$16 Trillion Only Hints at the True U.S. Debt

Hiding the government's liabilities from the public makes it seem that we can tax our way out of mounting deficits. We can't.

by Chris Cox and Bill Archer

November 26, 2012

A decade and a half ago, both of us served on President Clinton's Bipartisan Commission on Entitlement and Tax Reform, the forerunner to President Obama's recent National Commission on Fiscal Responsibility and Reform. In 1994 we predicted that, unless something was done to control runaway entitlement spending, Medicare and Social Security would eventually go bankrupt or confront severe benefit cuts.

Eighteen years later, nothing has been done. Why? The usual reason is that entitlement reform is the third rail of American politics. That explanation presupposes voter demand for entitlements at any cost, even if it means bankrupting the nation.

A better explanation is that the full extent of the problem has remained hidden from policy makers and the public because of less than transparent government financial statements. How else could responsible officials claim that Medicare and Social Security have the resources they need to fulfill their commitments for years to come?

As Washington wrestles with the roughly $600 billion "fiscal cliff" and the 2013 budget, the far greater fiscal challenge of the U.S. government's unfunded pension and health-care liabilities remains offstage. The truly important figures would appear on the federal balance sheet—if the government prepared an accurate one.

But it hasn't. For years, the government has gotten by without having to produce the kind of financial statements that are required of most significant for-profit and nonprofit enterprises. The U.S. Treasury "balance sheet" does list liabilities such as Treasury debt issued to the public, federal employee pensions, and post-retirement health benefits. But it does not include the unfunded liabilities of Medicare, Social Security and other outsized and very real obligations.

As a result, fiscal policy discussions generally focus on current-year budget deficits, the accumulated national debt, and the relationships between these two items and gross domestic product. We most often hear about the alarming $15.96 trillion national debt (more than 100% of GDP), and the 2012 budget deficit of $1.1 trillion (6.97% of GDP). As dangerous as those numbers are, they do not begin to tell the story of the federal government's true liabilities.

The actual liabilities of the federal government—including Social Security, Medicare, and federal employees' future retirement benefits—already exceed $86.8 trillion, or 550% of GDP. For the year ending Dec. 31, 2011, the annual accrued expense of Medicare and Social Security was $7 trillion. Nothing like that figure is used in calculating the deficit. In reality, the reported budget deficit is less than one-fifth of the more accurate figure.

Why haven't Americans heard about the titanic $86.8 trillion liability from these programs? One reason: The actual figures do not appear in black and white on any balance sheet. But it is possible to discover them. Included in the annual Medicare Trustees' report are separate actuarial estimates of the unfunded liability for Medicare Part A (the hospital portion), Part B (medical insurance) and Part D (prescription drug coverage).

As of the most recent Trustees' report in April, the net present value of the unfunded liability of Medicare was $42.8 trillion. The comparable balance sheet liability for Social Security is $20.5 trillion.

Were American policy makers to have the benefit of transparent financial statements prepared the way public companies must report their pension liabilities, they would see clearly the magnitude of the future borrowing that these liabilities imply. Borrowing on this scale could eclipse the capacity of global capital markets—and bankrupt not only the programs themselves but the entire federal government.

These real-world impacts will be felt when currently unfunded liabilities need to be paid. In theory, the Medicare and Social Security trust funds have at least some money to pay a portion of the bills that are coming due. In actuality, the cupboard is bare: 100% of the payroll taxes for these programs were spent in the same year they were collected.

In exchange for the payroll taxes that aren't paid out in benefits to current retirees in any given year, the trust funds got nonmarketable Treasury debt. Now, as the baby boomers' promised benefits swamp the payroll-tax collections from today's workers, the government has to swap the trust funds' nonmarketable securities for marketable Treasury debt. The Treasury will then have to sell not only this debt, but far more, in order to pay the benefits as they come due.

When combined with funding the general cash deficits, these multitrillion-dollar Treasury operations will dominate the capital markets in the years ahead, particularly given China's de-emphasis of new investment in U.S. Treasurys in favor of increasing foreign direct investment, and Japan's and Europe's own sovereign-debt challenges.

When the accrued expenses of the government's entitlement programs are counted, it becomes clear that to collect enough tax revenue just to avoid going deeper into debt would require over $8 trillion in tax collections annually. That is the total of the average annual accrued liabilities of just the two largest entitlement programs, plus the annual cash deficit.

Nothing like that $8 trillion amount is available for the IRS to target. According to the most recent tax data, all individuals filing tax returns in America and earning more than $66,193 per year have a total adjusted gross income of $5.1 trillion. In 2006, when corporate taxable income peaked before the recession, all corporations in the U.S. had total income for tax purposes of $1.6 trillion. That comes to $6.7 trillion available to tax from these individuals and corporations under existing tax laws.

In short, if the government confiscated the entire adjusted gross income of these American taxpayers, plus all of the corporate taxable income in the year before the recession, it wouldn't be nearly enough to fund the over $8 trillion per year in the growth of U.S. liabilities. Some public officials and pundits claim we can dig our way out through tax increases on upper-income earners, or even all taxpayers. In reality, that would amount to bailing out the Pacific Ocean with a teaspoon. Only by addressing these unsustainable spending commitments can the nation's debt and deficit problems be solved.

Neither the public nor policy makers will be able to fully understand and deal with these issues unless the government publishes financial statements that present the government's largest financial liabilities in accordance with well-established norms in the private sector. When the new Congress convenes in January, making the numbers clear—and establishing policies that finally address them before it is too late—should be a top order of business.

Read more: http://goo.gl/thbZY