Monthly Archives: March 2015

The President’s flawed defense policy, and Republican complicity

As the President enters into his seventh federal budget era, it is clear that his defense policy can be summarized in a single concept: drain as much funding from national security as possible in order to continue to provide more dollars for his greatly expanded entitlement programs.

To accomplish its goal, the White House has essentially surrendered the safety both of the United States and its allies. Several examples:

  • Budget cuts forced the departure of experienced armed forces personnel,
  • The U.S. Army will soon be reduced to levels below that of North Korea,
  • the U.S. Navy is dwindling from a global defense force to one that is rapidly becoming a mere regional power, (for the first time since WWII ended, no U.S. aircraft carrier is available for regular patrol in the East Pacific.)
  • missile defense programs were cancelled or delayed,
  • key allies have been or are in the process of being alienated,
  • American tanks were withdrawn from Europe,
  • a treaty was signed allowing Russia to gain or retain strategic and conventional nuclear superiority,
  • While every other atomic weapons-bearing nation has modernized extensively, only belated and inadequate updates have been planned for the U.S. nuclear deterrent.

As noted in recent budget hearings, the Pentagon’s 10-year budget projections have absorbed more than $750 billion in cuts, or more than three-quarters of the trillion-dollar cuts that would be required if sequestration is allowed to run its course. The fiscal year 2016 budget is at a near-historic low, representing about 14 percent of total federal discretionary and nondiscretionary outlays.

The results have been staggeringly dangerous. Moscow has entered into a new era of expansionism, not just in beginning the process of reconstituting the Soviet Empire but in rapidly moving into Latin America, as well as threatening NATO members in Europe.  It has embarked on a vast and costly program to make its armed forces the most modern and best equipped in the world.

China’s unprecedented military buildup and U.S. timidity combined to allow Beijing to steal resources from the Philippines and assert flawed territorial claims against almost all of its neighbors.

North Korea has expanded its nuclear prowess into a force that can threaten any spot on the planet, and Iran is poised to become the dominant power in the Middle East.

The White House’s lessening of sanctions against its nuclear program remains a text-book example of how not to succeed in negotiations. Terrorist forces are moving confidently into Africa. The premature withdrawal from Iraq led directly to the conditions allowing ISIS to flourish, and the impending withdrawal from Afghanistan may lead that region to a similar fate. The U.S. didn’t even respond with force when its own ambassador was assassinated in Benghazi.

Traditionally, Republicans have served to check the impulse of the hard left to divert excessive funds from defense to social welfare programs.  However, despite words of bluster, the Republican leadership continues to adhere to the sequester, which, in response to budget deficits that are largely the results of excessive entitlement spending, slices all programs indiscriminately. They have failed to respond effectively, either by legislation, budgetary means, or public statements to the reckless disregard for national security evidenced by the Obama Administration.  The revolt of several Republican potential presidential candidates may be a long-overdue reality check for the GOP brass.

Undercutting defense against nuke attack

In the 1980’s,  President Reagan challenged the U.S. scientific community to develop antiballistic missile technologies to defend the nation against a potential nuclear attack. Before fielding a single rocket, the concept proved successful, serving as part of a combination of existing and potential weapons systems that convinced Moscow it could not militarily overtake America.

The technology matured, and is now a reality. But continued underfunding has prevented the full promise of this defensive capability from being developed.  Opposition has been fierce.  Running for office, Barack Obama once demanded that the budget for the program be cut by a greater amount than was actually allocated to it.

Rep. Mike Rogers (R-AL),  Chairman of the Subcommittee on Strategic Forces, has noted that “missile defense is a core mission; it is not a nice to have, it is a must do.”  Rogers noted that for missile defense to become effective, it requires adequate funding.

The Wall Street Journal  recently noted that “Of $4 trillion for the federal government overall … Mr. Obama wants $8.1 billion for the Pentagon’s Missile Defense Agency. That’s up from $7.5 billion last year—the first real-dollar increase since 2011—but the overall trend remains downward. Funding is set to drop again after fiscal 2016, leaving missile defense slashed 25% in real dollars over the Obama Presidency.”

The need for this shield has become greater than ever.  Pentagon officials have testified before Congress, noting:

“The threat continues to grow as our potential adversaries acquire a greater number of ballistic missiles, increasing their range, incorporating BMD countermeasures, and making them more complex, survivable, reliable, and accurate. Space-launch activities involve multistage systems that further the development of technologies for intercontinental ballistic missiles (ICBMs). In addition to the Taepo Dong 2 space launch vehicle/ICBM, North Korea is developing and has paraded the KN08 road-mobile ICBM and an intermediate-range ballistic missile (IRBM) capable of 3 reaching Guam and the Aleutian Islands. As part of a series of provocations last year, North Korea conducted multiple short- and medium-range ballistic missile launches and threatened to conduct additional longer-range launches. Today it fields hundreds of Scud and No Dong missiles that can reach U.S. forces forward deployed to the Republic of Korea and Japan. Iran has publicly stated it intends to launch a space launch vehicle as early as this year (2015) that could be capable of intercontinental ballistic missile ranges if configured as such. Iran also has steadily increased its ballistic missile force, deploying next-generation short- and medium-range ballistic missiles (SRBMs and MRBMs) with increasing accuracy and new submunition payloads. Tehran’s overall defense strategy relies on a substantial inventory of theater ballistic missiles capable of striking targets in southeastern Europe. Iran continues to develop more sophisticated missiles and improve the range and accuracy of current missile systems, and it has publicly demonstrated the ability to launch simultaneous salvos of multiple rockets and missiles. Demonstrating it is capable of modifying currently deployed ballistic missile systems, Iran has flight-tested a Fateh-110 ballistic missile in an anti-ship role. By adding a seeker to improve the missile’s accuracy against sea-based targets, Iran could threaten maritime activity throughout the Persian Gulf and Strait of Hormuz.”

Iran, Yemen rebels in conflict with regional coalition

Fighting between the Iranian-backed Houthis movement against the elected government of Yemen threatens to be the start of a long-feared wider conflict in the Middle East, with Iran and  its client groups supporting the Houthis side and Saudi Arabia, Egypt, Jordan, Morocco, Bahrain, Kuwait, Qatar and the United Arab Emirates assisting the government. Although not in the region, Pakistan and Sudan have supported the effort. Israel has allowed the use of its air space for Saudi air forces to conduct sorties—part of the mainstream Arab states “Operation Decisive Storm”– in Yemen. Russia, which has supplied Iran with nuclear technology and other military assistance, appears to be siding with Iran and the Houthis on the issue. Both nations have called for a halt to the Saudi coalition’s support for the Yemeni government.

Regional governments have long feared the increasing military power and nuclear potential of Iran, as well as that regime’s proclivity to support and profit from radical groups. Washington’s premature withdrawal of U.S. forces from Iraq, its failure to react militarily to the assassination of Ambassador Stevens, the failure to support the “red line” in Syria, the weak American response to ISIS, and the diminishing size of American armed forces in general have unleashed tensions in the Middle East and elsewhere.

A White House Statement https://www.whitehouse.gov/the-press-office/2015/03/25/statement-nsc-spokesperson-bernadette-meehan-situation-yemen delivered by NSC Spokesperson Bernadette Meehan noted:

“The United States strongly condemns ongoing military actions taken by the Houthis against the elected government of Yemen.  These actions have caused widespread instability and chaos that threaten the safety and well-being of all Yemeni citizens. The United States has been in close contact with President Hadi and our regional partners.  In response to the deteriorating security situation, Saudi Arabia, Gulf Cooperation Council (GCC) members, and others will undertake military action to defend Saudi Arabia’s border and to protect Yemen’s legitimate government.  As announced by GCC members earlier tonight, they are taking this action at the request of Yemeni President Abdo Rabbo Mansour Hadi.

“The United States coordinates closely with Saudi Arabia and our GCC partners on issues related to their security and our shared interests.  In support of GCC actions to defend against Houthi violence, President Obama has authorized the provision of logistical and intelligence support to GCC-led military operations.  While U.S. forces are not taking direct military action in Yemen in support of this effort, we are establishing a Joint Planning Cell with Saudi Arabia to coordinate U.S. military and intelligence support.

 

“At the same time, the United States continues to closely monitor terrorist threats posed by al-Qa’ida in the Arabian Peninsula and will continue to take action as necessary to disrupt continuing, imminent threats to the United States and our citizens.

 

We strongly urge the Houthis to halt immediately their destabilizing military actions and return to negotiations as part of the political dialogue.  The international community has spoken clearly through the UN Security Council and in other fora that the violent takeover of Yemen by an armed faction is unacceptable and that a legitimate political transition – long sought by the Yemeni people – can be accomplished only through political negotiations and a consensus agreement among all of the parties.”

 

Washington’s Worst Mistake

Proposals for Washington’s 2016 budget, like so many before it, allow for the continuation of  a failed effort that is so vast it hampers the federal government’s ability to fulfill its traditional responsibilities.  it’s clear that the “War on Poverty” hasn’t produced results.  So why do the programs and concepts of this failed effort continue?

The federal debt was $18 trillion as of the filing of this New York Analysis report in late March 2015, a figure that grew by $483 billion in 2014.  The future looks grim. According to the Congressional Budget Office (CBO) “The deficit in 2025 is projected to be $1.1 trillion, or 4.0 percent of GDP, and cumulative deficits over the 2016–2025 period are projected to total $7.6 trillion. CBO expects that federal debt held by the public will amount to 74 percent of GDP at the end of this fiscal year—more than twice what it was at the end of 2007 and higher than in any year since 1950. By 2025, in CBO’s baseline projections, federal debt rises to nearly 79 percent of GDP.”

The lion’s share of the federal budget goes to War on Poverty-type entitlement programs. According to a Heritage  study, “In 2003, the entitlement share of the budget was 44 percent, compared with 49 percent today. Without reform of these massive and growing programs, Washington will have to borrow increasing amounts of money, piling debt onto younger generations and putting the nation on a dangerous economic course.”  (By contrast, 2014 spending on defense was 3.5 percent of GDP, or less than half of what it was in 1965, and falling.)

Heritage notes that “In his January 1964 State of the Union address, President Lyndon Johnson proclaimed, ‘This administration today, here and now, declares unconditional war on poverty in America.’ In the 50 years since that time, U.S. taxpayers have spent over $22 trillion on anti-poverty programs. Adjusted for inflation, this spending (which does not include Social Security or Medicare) is three times the cost of all U.S. military wars since the American Revolution. Yet progress against poverty, as measured by the U.S. Census Bureau, has been minimal, and in terms of President Johnson’s main goal of reducing the ‘causes’ rather than the mere ‘consequences’ of poverty, the War on Poverty has failed completely. In fact, a significant portion of the population is now less capable of self-sufficiency than it was when the War on Poverty began.”

A New American study, discussing the rise in entitlements, emphasized that “Even more troubling is that analysts say the trends look set to accelerate as Washington, D.C., intensifies its failed efforts to supposedly achieve “victory” in the “war” while the Federal Reserve conjures ever greater quantities of currency into existence…Since Obama took office, 13 million more Americans have become dependent on food stamps, with the numbers now hitting a record 47 million — about a third more than when he was sworn in. In 2007, there were 26 million recipients. Spending on the scheme has more than doubled just since 2008. The explosion of the program, along with other welfare schemes, has resulted in countless commentators and critics labeling Obama ‘the Food Stamp President.”

Ironically, the National Tax Limitation Foundation notes that before the War on Poverty began, the U.S. poverty rate had been declining precipitously.  “The poverty rate fell from 32% in 1950 to 17.3% in 1965 to 14.7% in 1966.

A Forbes review, which termed the war on poverty to be a “catastrophic” failure, found that “Between 1967 and 2012, U.S. real GDP (RGDP) per capita (in 4Q2013 dollars) increased by 127.3%, from $23,706 to $52,809.  In other words, to stay out of poverty in 1967, the two adults in a typical family of four had to capture 26.9% of their family’s proportionate share of RGDP (i.e., average RGDP per capita, times four).  To accomplish the same thing in 2012, they only had to pull in 12.1% of their family’s share of RGDP.  And yet, fewer people were able to manage this in 2012 than in 1967.”

The CATO Institute outlined the amounts spent in a single year: “In 2012, the federal government spent $668 billion to fund 126 separate anti-poverty programs. State and local governments kicked in another $284 billion, bringing total anti-poverty spending to nearly $1 trillion. That amounts to $20,610 for every poor person in America, or $61,830 per poor family of three. Spending on the major anti-poverty programs increased in 2013, pushing the total even higher. Over the last 50 years, the government spent more than $16 trillion to fight poverty. Yet today, 15 percent of Americans still live in poverty. That’s scarcely better than the 19 percent living in poverty at the time of Johnson’s speech. Nearly 22 percent of children live in poverty today. In 1964, it was 23 percent. How could we have spent so much and achieved so little?”

In their book, The Poverty of Nations,” by Dr. Wayne Grudem and economist Barry Asmus explain why they believe government programs have largely failed. They summarized their  analysis in a recent WND interview: “The solutions to poverty come when people … are enabled to produce their own prosperity. The question is not equality. The question is, ‘Is there opportunity? Is there freedom in the workplace? Is there economic freedom? Is there governmental freedom from excessive regulations so that people who are at the lower end of the income bracket can progress and hope to progress toward higher income?…What about the things we’re doing in the United States? Aren’t we having more government regulation, higher taxation, disincentives to productivity, disincentives to work? Aren’t we having moral breakdown in the way that people think of honesty and truthfulness, not breaking contracts and obedience to the rule of law?’” he said. “There are many things our country is doing that are actually hindering our economic growth and, of course, that results in a stagnant economy essentially.”

Why do the failed concepts of the War on Poverty continue to exist, and continue to deplete the taxpayer’s pockets?  Part of the answer is politics. Progressive candidates, who depend on class warfare for their electoral success, view them as a war of redistributing the “wealth” to those on the lower rungs of the economy. But there is another, heavily vested interest as well.  The War on Poverty has created an entire special interest of bureaucratic jobs. As noted in a Philly.com article written decades ago,

“Whatever this approach does for poverty, it’s going to be a boon to poverty workers, the one class that benefits most from anti-poverty programs. They’ll be the ones running the classrooms, job training sessions, work programs, and child-care centers authorized by this bill – all in the name of making the poor independent. Some early studies have shown that any training beyond the most basic seldom gets people off the dole…Back when government actually put millions to work – through the Works Progress Administration, the Civilian Conservation Corps, and a spate of other New Deal programs – job preparation might consist of showing up and being handed a shovel. Yet the country is still rich in libraries built, roads paved, and lands reforested that way.”

It is troubling that the War on Poverty, despite failing to address the problem it was created to resolve, has, due to politics and special interests, grown to the point where it dominates the federal budget.

Obamacare’s new and increased taxes

As Americans, as families, individuals or small businesses, prepare their tax returns, the burden created by Obamacare becomes increasingly evident.  The Americans for Tax Reform has compiled a comprehensive list of the measure’s 20 new or increased tax hikes, listed by size.

$123 Billion: Surtax on Investment Income (Takes effect Jan. 2013): A new, 3.8 percent surtax on investment income earned in households making at least $250,000 ($200,000 single). This would result in the following top tax rates on investment income:

Capital Gains Dividends Other*
2012 15% 15% 35%
2013+ 23.8% 43.4% 43.4%

 

*Other unearned income includes (for surtax purposes) gross income from interest, annuities, royalties, net rents, and passive income in partnerships and Subchapter-S corporations.  It does not include municipal bond interest or life insurance proceeds, since those do not add to gross income.  It does not include active trade or business income, fair market value sales of ownership in pass-through entities, or distributions from retirement plans.  The 3.8% surtax does not apply to non-resident aliens. (Bill: Reconciliation Act; Page: 87-93)

$86 Billion: Hike in Medicare Payroll Tax (Takes effect Jan. 2013): Current law and changes:

First $200,000
($250,000 Married)
Employer/Employee
All Remaining Wages
Employer/Employee
Current Law 1.45%/1.45%
2.9% self-employed
1.45%/1.45%
2.9% self-employed
Obamacare Tax Hike 1.45%/1.45%
2.9% self-employed
1.45%/2.35%
3.8% self-employed

 

Bill: PPACA, Reconciliation Act; Page: 2000-2003; 87-93

 

$65 Billion: Individual Mandate Excise Tax and Employer Mandate Tax (Both taxes take effect Jan. 2014):

Individual: Anyone not buying “qualifying” health insurance as defined by Obama-appointed HHS bureaucrats must pay an income surtax according to the higher of the following

1 Adult 2 Adults 3+ Adults
2014 1% AGI/$95 1% AGI/$190 1% AGI/$285
2015 2% AGI/$325 2% AGI/$650 2% AGI/$975
2016 + 2.5% AGI/$695 2.5% AGI/$1390 2.5% AGI/$2085

 

Exemptions for religious objectors, undocumented immigrants, prisoners, those earning less than the poverty line, members of Indian tribes, and hardship cases (determined by HHS). Bill: PPACA; Page: 317-337

 

Employer: If an employer does not offer health coverage, and at least one employee qualifies for a health tax credit, the employer must pay an additional non-deductible tax of $2000 for all full-time employees.  Applies to all employers with 50 or more employees. If any employee actually receives coverage through the exchange, the penalty on the employer for that employee rises to $3000. If the employer requires a waiting period to enroll in coverage of 30-60 days, there is a $400 tax per employee ($600 if the period is 60 days or longer). Bill: PPACA; Page: 345-346

(Combined score of individual and employer mandate tax penalty: $65 billion)

$60.1 Billion: Tax on Health Insurers (Takes effect Jan. 2014): Annual tax on the industry imposed relative to health insurance premiums collected that year.  Phases in gradually until 2018.  Fully-imposed on firms with $50 million in profits. Bill: PPACA; Page: 1,986-1,993

$32 Billion: Excise Tax on Comprehensive Health Insurance Plans (Takes effect Jan. 2018): Starting in 2018, new 40 percent excise tax on “Cadillac” health insurance plans ($10,200 single/$27,500 family).  Higher threshold ($11,500 single/$29,450 family) for early retirees and high-risk professions.  CPI +1 percentage point indexed. Bill: PPACA; Page: 1,941-1,956

$23.6 Billion: “Black liquor” tax hike (Took effect in 2010) This is a tax increase on a type of bio-fuel. Bill: Reconciliation Act; Page: 105

$22.2 Billion: Tax on Innovator Drug Companies (Took effect in 2010): $2.3 billion annual tax on the industry imposed relative to share of sales made that year. Bill: PPACA; Page: 1,971-1,980

$20 Billion: Tax on Medical Device Manufacturers (Takes effect Jan. 2013): Medical device manufacturers employ 360,000 people in 6000 plants across the country. This law imposes a new 2.3% excise tax.  Exempts items retailing for <$100. Bill: PPACA; Page: 1,980-1,986

$15.2 Billion: High Medical Bills Tax (Takes effect Jan 1. 2013): Currently, those facing high medical expenses are allowed a deduction for medical expenses to the extent that those expenses exceed 7.5 percent of adjusted gross income (AGI).  The new provision imposes a threshold of 10 percent of AGI. Waived for 65+ taxpayers in 2013-2016 only. Bill: PPACA; Page: 1,994-1,995

$13.2 Billion: Flexible Spending Account Cap – aka “Special Needs Kids Tax” (Takes effect Jan. 2013): Imposes cap on FSAs of $2500 (now unlimited).  Indexed to inflation after 2013. There is one group of FSA owners for whom this new cap will be particularly cruel and onerous: parents of special needs children.  There are thousands of families with special needs children in the United States, and many of them use FSAs to pay for special needs education.  Tuition rates at one leading school that teaches special needs children in Washington, D.C. (National Child Research Center(link is external)) can easily exceed $14,000 per year. Under tax rules, FSA dollars can be used to pay for this type of special needs education. Bill: PPACA; Page: 2,388-2,389

$5 Billion: Medicine Cabinet Tax (Took effect Jan. 2011): Americans no longer able to use health savings account (HSA), flexible spending account (FSA), or health reimbursement (HRA) pre-tax dollars to purchase non-prescription, over-the-counter medicines (except insulin). Bill: PPACA; Page: 1,957-1,959

$4.5 Billion: Elimination of tax deduction for employer-provided retirement Rx drug coverage in coordination with Medicare Part D (Takes effect Jan. 2013) Bill: PPACA; Page: 1,994

$4.5 Billion: Codification of the “economic substance doctrine” (Took effect in 2010): This provision allows the IRS to disallow completely-legal tax deductions and other legal tax-minimizing plans just because the IRS deems that the action lacks “substance” and is merely intended to reduce taxes owed. Bill: Reconciliation Act; Page: 108-113

$2.7 Billion: Tax on Indoor Tanning Services (Took effect July 1, 2010): New 10 percent excise tax on Americans using indoor tanning salons. Bill: PPACA; Page: 2,397-2,399

$1.4 Billion: HSA Withdrawal Tax Hike (Took effect Jan. 2011): Increases additional tax on non-medical early withdrawals from an HSA from 10 to 20 percent, disadvantaging them relative to IRAs and other tax-advantaged accounts, which remain at 10 percent. Bill: PPACA; Page: 1,959

$0.6 Billion: $500,000 Annual Executive Compensation Limit for Health Insurance Executives (Takes effect Jan. 2013): Bill: PPACA; Page: 1,995-2,000

$0.4 Billion: Blue Cross/Blue Shield Tax Hike (Took effect in 2010): The special tax deduction in current law for Blue Cross/Blue Shield companies would only be allowed if 85 percent or more of premium revenues are spent on clinical services. Bill: PPACA; Page: 2,004

$ Negligible: Excise Tax on Charitable Hospitals (Took effect in 2010): $50,000 per hospital if they fail to meet new “community health assessment needs,” “financial assistance,” and “billing and collection” rules set by HHS. Bill: PPACA; Page: 1,961-1,971

$ Negligible: Employer Reporting of Insurance on W-2 (Took effect in Jan. 2012): Preamble to taxing health benefits on individual tax returns. Bill: PPACA; Page: 1,957

 

The Future of Middle Eastern Conflict

Tune into a fascinating interview with renowned Middle East experts Andrew Bostom and William Jacobson this Friday on the Vernuccio/Novak Report.  The program can be heard on your local affiliated station or by clicking on to usagovpolicy.com.

U.S. defense spending at crisis point

During the past several years, Washington’s response to the vast and growing threats from Russia, China, Iran, North Korea and Islamic terrorism has been, irrationally, to sharply reduce the defense budget.

Defense Secretary  Ashton B. Carter recently noted  that “DoD’s 10-year budget projections have absorbed more than $750 billion in cuts, or more than three-quarters of the trillion-dollar cuts that would be required if sequestration is allowed to run its course…DoD’s fiscal year 2016 budget is at a near-historic low, representing about 14 percent of total federal discretionary and nondiscretionary outlays.”

In 2010, the total defense budget was $757 billion.  The 2016 budget is approximately $585 billion. Although the President and Congress differ somewhat in the way the funding is provided, the figure for both is essentially similar, and is in keeping with the sequester.

Writing in the Wall Street Journal, Senator John McCain (R-Arizona) and Rep. Mac Thornberry (R-Texas) noted that “We believe that [we] cannot continue to [to defend the nation] within the caps imposed by the 2011 Budget Control Act [sequestration.] They blame both President Obama as well as Republicans who continue to abide by sequestration. “There is no national security basis for sequestration. Within the past year Russia has challenged the postwar order in Europe by invading and annexing the territory of another sovereign nation. A terrorist army that has proclaimed its desire to attack the United States and its allies now controls a vast swath of territory in the heart of the middle east. Iran continues its pursuit of nuclear weapons while expanding its malign influence throughout the region. And China has stepped up its coercive behavior in Asia, backed by its rapid military modernization…Military spending is not to blame for out-of-control deficits and debt.  It is now [at] the lowest [share of federal spending] since before World War 2.

America’s nuclear arsenal, the only such force among the nuclear powers that has not undergone substantial modernization, has been cut from several thousand two decades ago to just several hundred today. Deployed war heads have been reduced from 9,000 twenty years ago to just 1,600 currently.  For the first time in history, Russia has more strategic nuclear firepower than the America, and a commanding ten to one advantage in tactical weapons.

Key parts of the U.S. defense establishment are at the breaking point, including the Air Force’s Drone fleet, as reported in the Daily Beast which reports that “overworked drone crews have had their leaves cancelled and suffered damage to their careers because they could not attend required professional military education courses.”

The U.S. Army will soon reach its lowest level since before World War 2, leaving a force smaller than North Korea’s. The Navy will be the smallest since World War I, and the Air Force will be at historic lows. The Marine Corps suffers drastic shortfalls in equipment, training and personnel. All this occurs while Russia and China build up their forces to unprecedented levels of size and capability.

Democrat, Republican Party leaders: Out of Touch?

The American political environment may be reaching a mood similar to the 1850’s, when the Republican Party was born, and the Whig Party saw its demise. The policies and practices of the leadership of both Democrat and Republican organizations appear to be drifting away from the beliefs of their membership.

President Obama’s extreme left wing politics, his isolationist and pacifist foreign policy, tolerance towards the Moslem Brotherhood, thinly disguised race baiting, and his anti-U.S. worker advocacy of high taxes, amnesty for illegal immigrants and environmental radicalism disturbs many. Heir apparent Hillary Clinton, co-architect of the utterly failed “reset”with Russia and advocate of “identity” politics is essentially similar in her beliefs.

Several key components of the Democrat formula for electoral success are becoming alienated. Blue collar workers who traditionally tilt towards the Democrats are uncomfortably viewing a landscape in which unemployment remains at a crisis level. Mr. Obama’s hostility towards Israel is beginning to weaken support among Jewish voters. Women are beginning to look askance at the politicization of their children’s education, escalating food prices, and diminished health care.

While Mr. Obama’s popularity as the first black president remains high within inner city voters, his economic and immigration policies have resulted in astronomical rates of unemployment in the black community, as well as the same price hikes that have disturbed all. His personal appeal may not translate into continued overall enthusiasm for other Democrats in 2016.

In the face of the Obama Administration’s dismal record, the Republican leadership has failed to vigorously push the alternative and vastly different perspectives of its adherents, essentially ignoring the formula for success that produced twelve years of dominance during the Reagan/Bush (41) era, and continuing even during the Clinton presidency when the Gingrich “Contract for America” forced some of the GOP agenda on the White House. Many question why House Speaker John Boehner did not pursue more legal action against what many saw as overreaches of executive authority by the White House.

Republicans have succeeded when advocating the dominating concepts of strong national defense, low taxes, restrained spending, a strict interpretation of Constitutional rights and procedures, and a more traditional cultural outlook. Many view the GOP’s response to the unprecedented failures of the Obama Administration to be timid and inconsequential, and more concerned with avoiding criticism from the media than in pursuing its beliefs.

There is, indeed, an inexplicable split within the Republican Party between the most vigorous advocates for its traditional positions, frequently identified as theTea Party, and the GOP leadership. Rather than latch onto the enthusiasm of that movement, it has been kept at arms-length. A further split can be observed between those demanding that the dramatic new military threats from Russia, China, Iran and North Korea be met with significant increases in the U.S. defense budget, and those advocating less expensive financing of the Pentagon as part of an overall approach to lowering deficit spending.

Complex election laws make it unlikely that new nationwide parties will spring up. But the organizational and communications abilities derived from new technologies will increasingly allow insurgents to go “over the heads” of party leadership to appeal for support directly from the voters. That same capability will allow temporary coalitions to form in response to specific issues supported by party leaders but opposed by the rank-and-file. In 2000, an unusual coalition of defense hawks, human rights advocates, and union leaders came together unsuccessfully to oppose a trade deal with China, supported by both President Clinton and GOP leaders, that they correctly feared would adversely affect U.S. national security, individual Chinese rights, and the job security of American manufacturing workers. That same opposition could meet with more success today.

The increasing burdens of the Sandwich Generation

Rep. Randy Forbes (R-Va.)  recently reported that “Almost half (47%) of Americans in their 40’s and 50’s have a parent who is 65 or older and are either raising a minor child or financially supporting an adult child at the same time. The Sandwich Generation will continue to grow. An increasing number of baby boomers are moving into retirement age, living longer lives, and, as a result, requiring costlier care.”

 

The White House notes that “An estimated 38 million Americans provide unpaid care to an aging relative, including approximately 23 million caregivers with jobs and 12 million who are also caring for their own children.”

 

A Texas A&M study found that “dealing with age-related changes in our older parents is a relatively new phenomenon. In 1900, for example, only one out of 25 people were age 65 or older. Today, one out of ten people are in this age category. Life expectancy at birth has increased 25 years in this century, to 69 years for males and 74 years for females. A male reaching age 65 can expect to live another 14 years and a female 18 more years. The most dramatic demographic change is the increase in the “old-old” population-persons 85 and over. This is the fastest growing age group and is expected to increase by 200 percent in the next 20 years. The older a person, the greater the likelihood of increasing health problems and frailty and the need for family support and assistance. Furthermore, it is no longer unusual for retirees age 65 and over to have a parent still living.”

 

INCREASING BURDEN


The Pew Research Center has outlined the increasing burdens faced by middle income Americans, particularly in regards to caring for longer-living parents and grown children who cannot find adequate employment in the faltering U.S. economy. The report finds:

 

   “With an aging population and a generation of young adults struggling to achieve financial independence, the burdens and responsibilities of middle-aged Americans are increasing. Nearly half (47%) of adults in their 40s and 50s have a parent age 65 or older and are either raising a young child or financially supporting a grown child (age 18 or older). And about one-in-seven middle-aged adults (15%) is providing financial support to both an aging parent and a child… While the share of middle-aged adults living in the so-called sandwich generation has increased only marginally in recent years, the financial burdens associated with caring for multiple generations of family members are mounting. The increased pressure is coming primarily from grown children rather than aging parents.

 

“According to a new nationwide Pew Research Center survey, roughly half (48%) of adults ages 40 to 59 have provided some financial support to at least one grown child in the past year, with 27% providing the primary support. These shares are up significantly from 2005. By contrast, about one-in-five middle-aged adults (21%) have provided financial support to a parent age 65 or older in the past year, basically unchanged from 2005. The new survey was conducted Nov. 28-Dec. 5, 2012 among 2,511 adults nationwide.

 

“Looking just at adults in their 40s and 50s who have at least one child age 18 or older, fully 73% have provided at least some financial help in the past year to at least one such child. Many are supporting children who are still in school, but a significant share say they are doing so for other reasons. By contrast, among adults that age who have a parent age 65 or older, just 32% provided financial help to a parent in the past year.

 

“One likely explanation for the increase in the prevalence of parents providing financial assistance to grown children is that the Great Recession and sluggish recovery have taken a disproportionate toll on young adults. In 2010, the share of young adults who were employed was the lowest it had been since the government started collecting these data in 1948. Moreover, from 2007 to 2011 those young adults who were employed full time experienced a greater drop in average weekly earnings than any other age group.”

 

POOR ECONOMY BRINGS YOUNG ADULTS HOME 


Forbes reports that “It’s an understatement to say that the stagnant 8% unemployment rate has far-reaching and profound effects. An unsteady job market is causing pain points across the demographic spectrum – young workers are saddled with student loan debt and low wages, while older adults face dual challenges of record-high life expectancy ratesand minimal retirement savings. Caught between the two are the middle-aged, who are delaying their own retirement to help their family members.” 

 

The Department of Labor Statistics found that  “ …by age 27, about 90 percent of …individuals had left their parental households at least once and more than 50 percent of them had moved back at some point after moving out.”


WOMEN HEAVILY AFFECTED


The Family Wealth Advisors Council Women of Wealth (“WoW Study”) national study revealed that “the Sandwich Generation dilemma was the single most significant transition challenge that women would face in the coming years. Studies have shown that the extreme stress of being a family caregiver causes premature aging and can take as much as 20 years off a family caregiver’s life. More than 90% of the women in the WoW Study told us that they were very concerned about having to make financial decisions during stressful moments – being called upon to meet the needs of multiple generations surely qualifies as stressful! Understanding the complexities and strategies to successfully navigate the pressure of caring for multiple generations is critical.”