Can the President refuse to defend a law?

After it was announced that the Obama Administration would no longer defend DOMA in court, Republican Massachusetts Senator Scott Brown had the following comment today:

"...We can't have presidents deciding what laws are constitutional and what laws are not. That is a function of the judicial branch, not the executive."

Brown is echoing what many Republicans have said. He is also betraying his own ignorance of the American political system. As a sitting United States Senator, that is rather sad.

In reality, *no* branch of government has been designated the specific function of declaring laws unconstitutional - not even the Judiciary. While it is often said the Judiciary fills that role, the fact is that nowhere does the US Constitution authorize the Supreme Court to do so. The seed of that 'authority' was planted in 1803, when the Court decided in Marbury vs. Madison that a Congressionally-enacted law was invalid due to its unconstitutionality.

However, the development of that authority within the Judiciary does not mean that other branches of government are free to ignore issues on Constitutionality. When the President takes his oath of office, he specifically swears the following:

"I do solemnly swear (or affirm) that I will faithfully execute the office of President of the United States, and will to the best of my ability, preserve, protect and defend the Constitution of the United States."

The President takes an oath to defend the US Constitution. He is not defending the Constitution if he or his administration are trying to preserve laws which violate that same Constitution.

The error Scott Brown makes - and one which many critics of Obama's decision are making - is the adoption of a simplistic view of government that ignores the overriding importance of the concept of the separation and balance of powers between the three branches of government.

On a simple level, it is often said that the Legislature "makes" the laws, and the Executive "carries out the laws." But that view skews the balance of power and makes it appear as if the President is merely a servant or administrator to Congress, whose only function is to do as he is told. Such a view sees the Legislature as superior to the President, and able to order him about to carry out their orders.

That is NOT how the structure of our national government was envisioned. Rather, it was conceived as being comprised of three separate branches, co-equal, each providing checks and balances to the others...and deliberately inefficient and inexact in the exercise of its powers. The ability of one branch to "check" another branch is one of the most basic features of the American System.

In 1788, within months of the adoption of the Constitution, James Madison, quoting the great political philosopher Baron de Montesquieu, wrote in Federalist Paper No. 47,

"When the legislative and executive powers are united in the same person or body," says he, "there can be no liberty, because apprehensions may arise lest the same monarch or senate should enact tyrannical laws to execute them in a tyrannical manner."

In other words, when these two branches 'merge' - or when one branch of government has the authority both to create laws AND force them to be carried out - tyranny may result.

It IS the President's responsibility to defend the Constitution...just as it is the Legislature's responsibility, AND the Judiciary's responsibility. No branch of government is 'superior,' and none is merely a servant to carry out the wishes of the other.

We see this all the time in less controversial settings:

Congress passes a law, and the Supreme Court refuses to convict someone under it.

The President authorizes a program, and Congress refuses to authorize spending to carry it out.

A Legislature passes laws against smoking marijuana, and the Executive branch (Mayors, Police Departments) choose NOT to enforce that law during a huge rock concert.

A president nominates Judges and Cabinet Appointees, and the Senate refuses to vote them up or down.

This happens on a regular basis. There is nothing different in the present case. Congress passed a law, DOMA, that is clearly Unconstitutional on multiple levels. Several Courts have already held that DOMA is Unconstitutional. The President is merely carrying out his responsibilities under the US Constitution to defend that document against laws which violate both its letter and spirit. It is a messy system, but it is messy on purpose...and any effort to insist that the President merely do as Congress tells him is certainly as un-American as it gets.

BREAKING: Obama will not defend DOMA

US Attorney General Eric Holder has announced that the US will no longer defend Sec 3of DOMA (“Defense of Marriage Act”) in court. This section prevented the Federal Government (and is agencies, such as the IRS) from recognizing the legitimacy of same-sex marriages validly performed in the 5 states and District of Columbia where such marriages are legal, and resulted in tax and survivorship inequities. This means that for all practical purposes, the recent rulings by Federal Courts in the northeast holding DOMA to be an unconstitutional overreach of federal authority into state matters will stand.

From Holders statement:

“...After careful consideration, including a review of my recommendation, the President has concluded that given a number of factors, including a documented history of discrimination, classifications based on sexual orientation should be subject to a more heightened standard of scrutiny. The President has also concluded that Section 3 of DOMA, as applied to legally married same-sex couples, fails to meet that standard and is therefore unconstitutional. Given that conclusion, the President has instructed the Department not to defend the statute in such cases. I fully concur with the President’s determination.

Consequently, the Department will not defend the constitutionality of Section 3 of DOMA as applied to same-sex married couples in the two cases filed in the Second Circuit. We will, however, remain parties to the cases and continue to represent the interests of the United States throughout the litigation. I have informed Members of Congress of this decision, so Members who wish to defend the statute may pursue that option. The Department will also work closely with the courts to ensure that Congress has a full and fair opportunity to participate in pending litigation...”

The Debt Reduction Commission, Part 2: Social Security

In a previous post, we addressed this commission's proposals for changes to the federal income tax. We generally agreed with them, and suggested they should even a bit bolder. In this post, we will revisit a topic I have blogged on at least twice before...the "social security" system.

Facing the prospect of a bubble of "baby-boomer" retirees, longer life expectancies (with higher medical costs), and fewer young workers paying taxes to support them...addressing this looming crisis is long overdue. The Obama Commission, in it's preliminary stages, has suggested the following:

1) Cost-of-living increases would be reduced for seniors (these increases are currently tied to the Consumer Price Index, which measures inflation. This year seniors received a big fat zero.)

2) Social Security benefits would be adjusted based on recipients’ incomes. Most retirees would receive less, but those with lower overall incomes would receive more.

3) Gradually raising the retirement age for full benefits from 67 to 69 — though not until 2075 (It would appear that this element is drawing the most fire so far)

4) More of workers’ incomes would be subject to Social Security taxes. Currently, workers are only taxed (at 7.65%) on their first $106,000 of income. In order to close the funding ga, the Commission is likely to propose raising this to $190,000. While this might seem prudent at first glance, many forget that businesses must match their employees social security contributions...and in the current economy (hell, ANY economy), this is a price too high for many businesses to absorb.

On this set of recommendations, we must disagree with the Commission's suggestions. To be fair, they deserve applause for tackling perhaps the most sacred of all sacred cows in the US. However, their approach still amounts to treating a compound fracture by wrapping it up in gauze.And so once again, we are lead to ask:

"If the Social Security System is such a good deal, why are thousands of federal and state government employees exempt from being involved in it? Why have they chosen federal and state pension systems, and private retirement options instead?"

And why haven’t the rest of America’s workers had that right? If we can cut through the political rhetoric, we might just be able to give our kids and grandkids better choices than we have had.

Social Security is a financial time bomb as a natural result of changing demographics. And the single biggest problem is how it is funded: current workers pay for current retirees. When today’s worker pays social security tax, it does not go into a ‘safe place’ to be held for his future retirement; rather, it is used to fund the checks of current retirees. As the Social Security system currently operates, that means that today’s workers will have to rely on their grandchildren’s taxes for retirement income.

When this system was devised more than eighty years ago, there were forty working people for each retiree. Today, as family size shrinks, that ratio is approaching only two young workers for every retiree. In the 1930s, the average life expectancy was only sixty-five; today, we have two generations of retirees living into the eighties and nineties. That means that as originally conceived, forty young people supported one senior for a relatively short period of time. It was seen as a caring social responsibility. But in today’s world, that means two young workers will need to support themselves, their family, and a retiree for almost twenty years. That’s neither ‘caring’ nor ‘socially responsible.’

In fact, it is the opposite: it is socially irresponsible because we are turning our grandchildren into indentured servants with a tax burden that can not be sustained, while asking our seniors to work longer and live on less.

In addition, one of the most distressing trends in America is the growing wealth disparity between the wealthy and poor. The Federal Reserve has found that the difference in median net wealth between the richest and poorest jumped 20% between 1998 and 2001 alone...and that was before the current unemployment mess.

Worse is the dirty little social security 'secret': The gap between whites and blacks has grown 21% , and the social security system has played a significant role in that widening gap. 52% of Americans invest privately, but the poorest, after paying for clothing, housing, food, transportation and medical care, have little or nothing left to invest. Yet, they are forced to pay 7.65% of their income as a social security tax. This worker may pay this tax for 40 years, but if he dies without minor children or a spouse over 65, none of that money passes to his heirs.

In essence, the current system robs the poor of their ability to get ahead. One in three African-American men will die without ever collecting a cent of social security, and with no investment inheritance to pass along, in spite of paying a compulsory retirement tax his entire life.

Personal Lifelong Investment Accounts are the answer to these inequities.

Workers should have the right to invest their own money, long-term, in their own accounts, so they may collect interest and bequeath their funds should they predecease their spouse. Retirement should be something that people work for and save for throughout their lifetime...not a tax on the next generation.

We are not suggesting that people place all their retirement funds in a single gamble (the “Enron” scare tactic.) Rather, investments should be placed in a highly-diverse, long-term, broad basket of stocks, bonds, and mutual funds that easily survive even should one company have trouble – precisely the plan that I, as a State employee, have the right to do.

Yes, the market has ups and downs. But no one planning to retire in 2010 begins by starting to invest in 2005. Long-term investments in the market have always yielded significant results, and retirement is a long-term process. Just as workers currently must pay a tax today to fund a check tomorrow, so may they be required to save today in an IRA that will garner growth, interest, and dividends over the course of the next 30 years. And yes, the federal government could and should continue to provide a safety net to guarantee a minimum income for ALL seniors.

Those who would seek to ‘save’ the current social security system always choose to accomplish that task through using coercion: they would tell you when you may retire, what your benefits would be, how much you would pay in taxes, and how much you would receive and on what schedule when you retire. It presupposes that government can somehow decide what is best for you. In a nation like Chile, workers decide how much they will put aside, when they will retire, where and how their money is invested, and what payment schedule they would prefer upon retirement. If they should pre-decease their retirement, their account still belongs to their estate, and their family is not left at the mercy of government payments. Returns on Chilean workers’ money has averaged 13%, far more than Americans can ever hope to make back on their social security contributions.

No wonder US government workers have permitted themselves to opt out of Social Security. It's time that right was given to the rest of America as well.

Obama's Debt-Reduction Commission: Income Tax & the Mortgage Interest Deduction

This week, leaders of a special bi-partisan White House Commission on Deficit Reduction released some of its preliminary recommendations. The recommendations, to be finalized next month, touch on hot-button issues such as the federal tax code (particularly the mortgage interest deduction and tax brackets), military spending, the corporate income tax, and social security. Interest groups on both the Left and Right immediately criticized those areas where their particular ox was gored.

But frankly, we think the Obama Commission is on the right track, and the suggestions deserve support. In fact, if anything, we think the proposal can be made even bolder than it is (My friends who are anti-tax advocates, real estate agents, and home-owners are screaming, "What?!?!?") We will attempt to address these in a series of separate posts. Today, we tackle the mortgage interest deduction and tax brackets.

Here are the Facts: The federal government's financial state has never been worse. EVER.

The current National Debt - the amount our expenses have exceeded our tax revenues - is at 13.7 trillion dollars. To put that in perspective, the total value of all the goods and services created in the United States over the course a year (our GDP)...is between 13 and 14 Trillion....which means our debt is as great as everything we are capable of producing. Or, put another way, the debt is $42,000 per man, woman, and child in the US.

And that is just the current debt. Since the US actually borrows money to engage in deficit spending, interest is continually added to this figure. Currently, almost 25 cents of every tax dollar goes simply to pay the interest on this debt. That's 25 cents that could otherwise be used for actual productive purposes...instead, that interest is paid to institutions enormous enough to be able to lend money to the US government to fund its deficit spending: The government of China, Goldman-Sachs, Lloyds of London, Credit-Suisse, the House of Saud, Morgan Stanley, and Citibank.

As long as we continue to pay interest like this, we are institutionalizing a situation where wealth leaves the hands of the general citizenry and is concentrated in the hands of those who already have enormous wealth. In other words: The rich get richer, while the poor - and the middle class, and our children - get poorer.

NEVER have we been this close to a financial catastrophe. And the time for playing politics is over.

According to the Wall Street Journal, "...The preliminary plan in its current form would end or cap a wide range of breaks relied on by the middle class—including the deduction for home-mortgage interest....To compensate, one version of the plan would dramatically lower and simplify individual rates, to 9%, 15% and 24%.."

Let's take these one at a time.

Home Mortgage Interest Deduction: This is one of the favorite income tax deductions used by middle class, home-owning Americans. (I wonder how many homeowners who are worried about the federal deficit will be willing to support changes in their personal sacred cow?)

The Federal Income Tax is, supposedly, a "Progressive Tax," meaning that the more money you make, a higher percentage of that income is paid in income tax. Of course, that's the theory...in reality, the use of deductions like the Home mortgage interest deduction actually reverses this, and places a higher tax burden on those with less wealth.

When a new mortgage is made for a home, the homeowner pays mostly interest in the earliest years. A new mortgage that runs $1500/month, for instance, might be as much as $1,400 interest and $100 in principle each month. The portion that represents interest is deducted from the homeowners gross income before the tax rate is applied. In the above example, a family earning $50,000/year could have an annual deduction of $16,800, reducing their taxable income to $33,200. The same family, if they were renting their home for $1,500 month, would have a deduction of ZERO. The Home Mortgage interest deduction results in penalizing those with fewer assets and rewarding those who already have wealth in the form of real estate assets. Rather then being a "progressive" tax, this deduction creates the opposite result.

In addition to these two families having different "taxable income," the renter may actually have to pay a larger tax rate because of the Federal Income Tax "Brackets:" A family making over $68,000 is taxed at 25%, while a family making $67,000 is only taxed at 15%. As a result, the mortgage interest deduction has become an almost necessary deduction used by American families to push them down into lower tax brackets to avoid punitively high taxes...again, at the expense of those who rent, or who bought their homes years ago, and have no such deductions, who must pick up the slack.

Bottom line: if Americans are to 'get on board' with the elimination of the mortgage interest deduction, they must first be convinced that it is part of a comprehensive tax reform package that is not going to drown them in taxes.


Tax Brackets: The Federal tax code currently utilizes six tax brackets: 10%, 15%, 25%, 28%, 33%, and 35%. The commission is proposing reducing this to only three tax brackets: 9%, 15%, and 24%. This still leaves the problem that taxpayers will seek deductions to 'push' them down into lower tax brackets. The time has come for a long-discussed, long-overdue idea: a simple Flat Tax. The commission (and more importantly, Congress) should be convinced to eliminate tax brackets altogether, and use a simple percent applied to income, with no 'deductions' for special vested interests.

A legitimate argument against a Flat Tax is that those at the very lowest end of the income earning spectrum are hurt. Not only are they unable to meet basic needs of shelter, heat, clothing, food, transportation, and health care...now they would need to pay 10% of what little they make to the government, further impoverishing them.

This could actually be addressed with one simple adjustment to the Flat Tax.

Each year, the Federal Government determines the 'poverty' level; in 2010, for a family of 4, that figure is $22,050. If one agrees that no family should be pushed into poverty because of taxes, then A Flat Tax could be applied to Gross Income less the poverty level income amount for that year. In other words, our family of 4 above, making $50,000, would subtract $22,050 from their gross income, and be taxed on the remaining $27,950. If the tax rate was a flat 15%, that family would pay 4,192 in taxes, regardless of whether they owned or rented. A family earning less than $22,050 would pay nothing; a family earning $200,000 would pay $30,000.

Simplification of the tax code by enacting a single Flat Tax rate, applied only to earnings above the poverty level, would eliminate the need for taxpayers to seek out special deductions, make the federal income tax far more equitable than it currently is, and help move us back on a track towards fiscal sanity.

Of course, now that we have hopefully calmed some of the real estate agents fears, the accountants who thrive on the Byzantine tax code will be up in arms....

NYC Islamic Center: Mayor Bloomberg is right and Peter King is Wrong.

NYC Mayor Michael Bloomberg has shown leadership and statesmanship on the subject of the planned Islamic Community Center in lower Manhattan. By contrast, Rep. Peter King is being disingenuous as he engages in hate-mongering and patently anti-American rhetoric. It is yet another confirmation of why I am no longer a Republican. President Obama, who began to take a strong stand, has immediately backtracked after criticism, and has proved to be a disappointment.

As a native New Yorker, I understand that every community on Long Island lost loved ones and neighbors in the 9/11 attacks. The entire ordeal still pushes my emotional buttons, and probably will until I die. But I am just as outraged by the barely-hidden, discriminatory, Constitution-shredding opposition to the Islamic Center's plans.

The issue before NYC was NOT whether a mosque should be allowed ‘near’ ground zero. In fact, a mosque has existed in that neighborhood since 1970. The issue was whether the specific building idenitifed for the Center should be preserved under historic commission guidelines and regulations.

Now, very often in government processes, "polite" objections are used to justify personal agendas. At many public hearings, issues such as traffic, noise, light, endangered species, and native american graves are all raised when residents want to oppose something in their back yard - whether or not those are legitimate issues. Much to the NYC Historic Commission's credit, they voted *unanimously* that there was no historic value to this building which was the ruse being used to obstruct the project.

If the question then, is “can a mosque be built?,” then clearly the answer is a resounding YES.

This nation has enshrined in the First Amendment of the Constitution the right of all people to practice their religion…PERIOD. We do not ignore Constitutional Rights because we don’t like “those people.” Once we do that, the terrorists have indeed won, and the American way of life has gone the way of every other tinhorn dictatorship.

We are NOT a nation with a National Religion. We are a nation that ascribes to Freedom of Religion, and a Prohibition on the Establishment of one religion over others.

Representative Peter King - who for 20 years openly met with and supported the IRA, a terrorist organization - suddenly developed a soft spot in his heart for the victims of terrorism. He called President Obama "wrong" and and issued the following statement:

"It is insensitive and uncaring for the Muslim community to build a mosque in the shadow of ground zero...While the Muslim community has the right to build the mosque, they are abusing that right by needlessly offending so many people who have suffered so much...The right and moral thing for President Obama to have done was to urge Muslim leaders to respect the families of those who died and move their mosque away from ground zero. Unfortunately, the president caved into political correctness..."

This is entirely disingenuous. King knows that opponents of the Islamic Center have no legal leg to stand on under the U. S. Constitution. Rather than taking the high road and promoting healing and the rule of law, he is giving official voice to the "I-don't-care-what-the-Constitution-says, we-don't-want-them-here, those-people-are-being-mean" mentality, and couching it in warm fuzzy terms, like some Big Brother Social Worker.

What is truly an affront affront to every New Yorker (like me), every NY Firefighter’s Family (like me), and everyone who lost people they knew in the WTC attacks (like me) are people like King who PRESUME to believe that we are delicate flowers who can’t handle Constitutional Rights and diversity, who believe that the proper response to the 9/11 attacks is to rip up the First Amendment.

That speech that is most odious is precisely that speech that must be protected.

That press that is most critical of the government is that press that must be protected.

That criminal who has committed the most heinous acts is precisely the criminal most in need of the Constitutional Rights afforded the accused.

That gun owner who is most despised by his pacifist neighbors is the person most in need ot the protection of the Second Amendment.

And that religous Faith that is most antithetical to the majority is the very faith that must be protected and granted equal standing before the law.

It is by granting freedom for Muslims to worship in that spot that we show how great America is. There IS no other option for Constitutionally-minded, patriotic Americans.

The President has not caved into "political correctness" as King asserts... if anything, he is caving into his own political cowardice. Obama and King could both learn something from Bloomberg.

DOMA, Prop 8 and Appeals: Outcomes and Next Steps

Yesterday's holding by a Federal District Court Judge that DOMA is Unconstitutional is a big step...but not the end. This was a decision issued by a federal judge on a federal law, but only in a "local" (Massachusetts) case. The question remains of how we turn a Federal District Court holding into a national holding. It would be very unusual for the entire federal government to just roll over and say, "OK, we gotta change now, Congress was wrong on this" as a result of a single District Court holding.

In the best of all worlds, the decision would need to be appealed to (and affirmed by) the Appellate level (and maybe moved on certiorari to the Supreme Court) strictly on the 10th Amendement aspect of the holding, to create a national holding. The 10th Amendment specifically grants to the States the right to legislate in those areas not given Federal jurisdiction, and this was the legal basis for yesterday's decision: States, not the Federal Government, are the entities with authority to define Marriage. DOMA attempted to allow the Federal Government to ignore State Marriage laws that recognize same-sex unions.

Meanwhile, on the West Coast, another decision looms. California's Proposition 8 overturned same-sex marriage in that state, and the Proposition has been challenged on other federal grounds: this one, however, is not based on "State's Rights," but on the Equal Protection Clause of the 14th Amendment to the US Constitution. The specific holding of that trial - which could be released any day - may very well provide a second Federal ruling requiring clarification or appeal...which could accelerate the process.

I expect that, if appealed, the two cases would be joined at the Supreme Court.

Back to yesterday's DOMA ruling: This puts Obama in a very difficult position. On one hand, he could decide to support the Massachusetts District Court decision nationwide; this would be highly unusual, maybe even unprecedented. District Court level Judges issue rulings all the time, often contradictory with each other and almost never with national application overnight.

On the other hand, Obama's Justice Department could Appeal the Massachusetts ruling, thus angering the less-than-critically-thinking gay blogosphere that understands that it *won* at the District Court level.

Whatever Obama decides to do, he must articulate his reasoning WELL both publicly and "within" party and GLBT leadership so its clear what is going on.

Obama and the Democrats' "Gay Problem"

The Problem: The gay community is (pick one: annoyed, frustrated, outraged) at the slow pace of the Obama administration in delivering on campaign promises. The only serious legal challenge to DADT is being waged by the Log Cabin Republicans, and the Obama Justice Department is defending DADT in homophobic language. If the Log Cabin wins, the Republicans can make legitimate inroads into the formerly-solidly Democratic gay community. If they lose, the Obama administration will be blamed. Either way, Obama and the Democrats LOSE.

So...My Prediction:


1) Obama proposes a Freeze on federal spending.

2) Obama cuts a deal with the Pentagon that he will exempt the Defense budget from that freeze, if they will accept DADT.

3) Pentagon generals lukewarmly support DADT at Congressional hearings.

4) DADT repeal is embedded in the Defense budget. Conservative Republicans dont like to oppose defense budgets. Liberal Democrats see a way to end DADT. Differences in the Defense budget can be reconciled by the House-Senate Conference Committee, and passed by a simple majority, thus thwarting GOP efforts to filibuster now that Scott Brown is "the Forty-First."

5) With DADT repealed, the Federal Courts must throw out the lawsuit filed by the Log Cabin Republicans against DADT as it is now moot.

6) Obama claims that he and the Dems have saved the day for the GLBT community.

7) Obama then back tracks with Fundamentalists and reiterates his support for DOMA and for the idea that marriage should be reserved for "one-man-one-woman."

8) Gay Activists applaud Obama for ending DADT, dismiss the GOP, and ask the gay grass roots to "give Obama time" on DOMA. Gay money and votes continue to flow to the Democrats in lemming-like fashion.

Anyone wanna place bets?

GDP up 3.5%? Obama's Hollow Cheerleading....

Apparently, we're supposed to pop the champagne corks and celebrate: GDP is up 3.5%, the recession is over, and the Recovery has begun. At least that's what the prObama Media outlets and White House are telling us.

My ECO 101 students could do a better job analyzing that statistic than most of the talking heads currently reporting it.

GDP (Gross Domestic Product) is a measure of all the goods and services created within a society's economy. Due to the work of noted Economist Arthur Okun, we know that GDP and Employment move in the same direction: when Employment increases, GDP increases, and vice versa. After four or five quarters of negative GDP, an increase of 3.5% would normally be a welcome sign. Except in this case, the figure is highly deceptive and manipulated, for the following reasons:

1) While GDP increased 3.5%, Consumer Spending - purchases by you and me - decreased by .5% AGAIN. In other words, the increase in purchases of goods and services did NOT come from "the people." Our spending fell. Rather, this spending came from the Federal Government as it purchased flashy orange signs to erect around the country proclaiming that our tax dollars were at work.

2) This additional spending was a one-time shot in the arm by the government. Does the White House and Congress expect to authorize 787 Billion every quarter to keep that up? Much of the increase in spending was in the "Cash for Clunkers" Program....which is now over, and which did not create a single job anywhere.

3) The White House claims that One Million jobs were saved or created through the stimulus. Since the stimulus was 787 Billion, that amounts to $787,000 tax dollars (not including future interest) spent per job. I would rate that as a FAILED effort.

4) The White House also claims that most of these jobs were in Construction and Education. How Convenient...construction jobs are considered highly seasonal, and when these workers lose their jobs in the winter, they are often excluded from the unemployment figures, which are usually presented as "seasonally adjusted unemployment" figures. The White House is now *counting* these jobs when they are created to credit the Stimulus Package, but you can bet these job losses will be *excluded* when the winter unemployment figures are released because they will be 'seasonally adjusted.'

5) Education, while important, doesn't create products or jobs. Saving jobs in education may ingratiate Obama to teacher's unions, but this sector does not create products or create wealth in the economy as other sectors do. It is no surprise that while GDP increased, Unemployment increased to 9.8%, and most economists expect it to hit double-digits this month - a month when pre-Christmas hiring would normally reduce this figure.

With unemployment increasing and consumer confidence and purchases falling, the 3.5% GDP increase is a make-believe number based on the Federal Government maxing out it's credit cards with few places left to turn when they come due.