Right Opposition

Does your wallet feel a little lighter? It should. Uncle Sam just bumped the debt ceiling to $1.9 trillion. That means you have even more that you have to pay back in the form of taxes in coming years.

Politico reports that Congress approved the record $1.9 trillion debt ceiling increase Thursday together with legislation to reinstate “pay-as-you-go” rules credited with helping to rein in deficits during the 1990s. CNN reports that the total U.S. Federal debt now stands at a staggering $12.3 trillion.

Earlier Alabama’s Senators Sessions and Shelby voted against the debt resolution in the upper chamber. Joe Bonner of Alabama’s 1st voted against it in the House.In fact, every single Republican in the House voted against the debt increase – every one. 37 Democrats voted against it.

This isn’t the end either. Remember the Obama budget? It is full of even more red ink and continues to ignore the economic reality that government cannot spend us out of debt. The roost is ready and the chickens are on their way in.

Oh and by the way, only one Alabama Congressman voted to raise the debt ceiling: Artur Davis (D-Birmingham). Davis is a leftist who has introduced a bill to provide federal loans to small businesses. Davis should remember that such loans are the province of banks. If left alone the banks will lend to any credit worthy organization or business. Fortunately Davis is the only Democrat among Alabama’s entire delegation.

Full vote results from the House are here:

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The 5.7% jump in the 4th quarter 2009 has excited many who claim that this is evidence that government intervention in the markets has worked. Some think we are saved because of the government’s intervention via the stimulus prorgrams of the past year. But let’s look at three important points.

GDP Is Still Low

The actual GDP in the 4th quarter stood at 14,463.4 billion dollars. The high was in the 3rd quarter of 2008 and we aren’t back there yet. The number may be an improvement but we are still below where we were. This is not surprising because we know unemployment is still high.

GDP Report is Incomplete

The 5.7% report is “incomplete” according to the Bureau of Economic Analysis. Most economist expect that the number will drop when all factors are finally factored in. Don’t count your chickens just yet.

GDP is Built on Government Deficit Spending

The present economy is growing, in part, because of deficit government spending. Every penny of the stimulus comes from taxpayers. But much is deficit. That means we have a massive federal debt hanging over our heads which must be repaid.

The number is good and is a slow improvement but keep it in perspective.

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