In this week's Liberty Update we highlight the potentially catastrophic threat of H.R. 3, the healthcare…
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Notable Quote: WSJ on H.R. 3, Biden & Pelosi's Dangerous Healthcare Bill

In this week's Liberty Update we highlight the potentially catastrophic threat of H.R. 3, the healthcare and drug price control bill that Joe Biden and Nancy Pelosi are attempting to rush through Congress.  The Wall Street Journal helpfully offers further insight this morning on how H.R. 3 would threaten lifesaving U.S. pharmaceutical innovation and leadership, including on things like the Covid vaccines:

Companies that refuse the government’s price must pay a 95% excise tax on all revenue they generate from that drug in the U.S.  They’d also have to offer the government price to private insurers.  There’s no “negotiation” when a gun is pointed at your head.  A new study in the Journal of the American Medical Association estimates that drug spending in the U.S. would…[more]

September 23, 2021 • 10:23 AM

Liberty Update

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Obama’s Big Fat Greek Bailout Print
By Timothy H. Lee
Thursday, April 29 2010
According to the nonpartisan Congressional Budget Office, Obama’s new spending and deficit agenda will more than double federal debt in just ten years (from 40% to 90% of GDP), approaching Greece’s current debt levels.

Amusing entertainment news this week comes out of Britain, where Deadline London reports an upcoming Barack Obama miniseries based upon journalist Richard Wolffe’s book, The Making of a President

Here’s an idea for a better title:  Obama’s Big Fat Greek Bailout. 

After all, Obama’s enormous and unsustainable entitlement agenda perilously tracks Greece’s, and the future consequences will be the same unless someone interrupts his bad sequel. 

That British entertainment news dovetails with less humorous news elsewhere in Europe this week, as the Greek fiscal meltdown suddenly escalated into a European contagion.  Subsequent credit downgrades in Portugal and Spain triggered alarm that the entire euro zone faces a debt crisis, and increasingly-panicked investors abandoned euro zone stocks and bonds.  Additionally, the cost of insuring European companies against debt defaults jumped following this news, and the euro’s value declined. 

Previous cost estimates of a €45 billion ($60 billion) Greek bailout suddenly reached €120 billion ($160 billion). 

Beginning to sound familiar? 

Unfortunately, no one can say whether this Greek bailout would be just the beginning.  Recall that Argentina plummeted from one of the world’s more prosperous countries to basket-case status after continuing fiscal recklessness and repeated IMF bailouts.  Similarly, this could merely be the first in a series of rescues whenever Greek citizens riot in the streets to selfishly demand that German or Belgian taxpayers perpetuate the bloated social welfare payments to which they feel entitled. 

So how does this relate to Obama and the United States? 

Well, consider the alarming similarity between Greek and American debt levels.  According to the nonpartisan Congressional Budget Office, Obama’s new spending and deficit agenda will more than double federal debt in just ten years (from 40% to 90% of GDP), approaching Greece’s current debt levels.  As Fortune also noted, America’s course under Obama dangerously resembles Greece: 

Historically, a debt-to-GDP ratio north of 90% and a deficit-as-a-percentage-of-GDP north of 10% have been the lines in the sand to watch.  As governments cross those barriers, they enter into the Pig Zone.  While the leaders of Greece can try to blame speculators for their fiscal issues, the reality is that hedge funds are betting against Greece based on years of the country budgeting far beyond its means.  The Greek leaders have managed their nation to a debt-to-GDP ratio north of 110% and deficit-as-a-percentage-of-GDP that exceeds 12.7%.  Blaming speculators may be politically convenient, but it doesn’t change the facts.  As we watch the Greece situation unfold, the fiscal metrics in the United States become even more concerning.  According to estimates, the United States is running a debt-to-GDP ratio of 84% and a deficit-to-GDP of almost 11%. 

Consider also Obama’s performance record to date in other areas.  This month, the official Centers for Medicare & Medicaid Office of the Actuary (CMS) acknowledged that ObamaCare will increase healthcare spending, breaking his assurances that it would instead reduce spending.  The CMS now projects that total costs will increase by $251 billion over the next ten years. 

That’s not a rounding error – it’s one-quarter of a trillion dollars. 

Perhaps the “O” symbol used by Obama supporters now stands for “Oops?” 

That is merely one very recent example.  Recall that Obama also projected that his “stimulus” bill would keep unemployment below 8%, but it continues to hover near 10% over one year later.  We also face tens of trillions of dollars in unfunded future obligations under Medicare and Social Security, as well as the cautionary example of California and its potential bailout request after years of fiscal recklessness.

Combine Obama’s burgeoning record of budgetary miscalculation with his affinity for bailouts, and we suddenly have a script for a very bad sequel to My Big Fat Greek Wedding

Obama and liberals mindlessly seek to make America more like Europe, but Greece illustrates the tragic ultimate destination.  Deficit spending certainly didn’t begin under Obama, but he took the historical average deficit of 2.9% of GDP and quadrupled it to 11% in just one year.  By way of comparison, since Obama seems to enjoy scapegoating his predecessor, President Bush’s average was just 3.2%. 

Fortunately, there’s a way we can avoid the Greek path upon which Obama is taking America.  Namely, by returning to fundamental principles of spending and entitlement discipline in the manner boldly suggested by Congressman Paul Ryan (R – Wisconsin). 

Otherwise, we can prepare for a big fat Greek fiasco with Obama playing the starring role. 

Quiz Question   
What is the single deadliest disease epidemic to the U.S. population in history?
More Questions
Notable Quote   
 
"According to the left-of-center Tax Policy Center, Biden's tax plan will raise taxes on 75% of middle-class families next year and 95% of families over the long term. Biden's policies are already slowing the economy. In August, the U.S. added just 235,000 jobs, a far cry from estimates that 720,000 jobs would be created. The economy has over 600,000 fewer jobs than the Biden administration boasted…[more]
 
 
—Grover Norquist, President of Americans for Tax Reform
— Grover Norquist, President of Americans for Tax Reform
 
Liberty Poll   

Pres. Biden is seeking IRS authority to monitor every American financial transaction exceeding $600. Is there any legitimate government reason you can think of for such micro-monitoring of individual financial transactions?