To WSJ: Get the Headline Right: “Europe [Does Not] Delay Bailout Payment"

The WSJ headline reads: “Europe Delays Bailout Payment.” If you read the article, it says that the Eurozone lenders  released only 4.2 billion Euro instead of the agreed-upon 5.2 billion. The remainder, Eurozone governments threaten, will not be paid unless Greece forms a coalition government that will honor its austerity pact.  Remarkably the 4.3 billion covers the 3.3 billion Greece must pay next week. The slow drip-drip torture continues.

There is no way Greece can form a government that will adhere to its austerity agreements. The Eurozone leaders might as well bite the bullet now and save a few billion Euros.

It is time to recognize that the heart patient is terminal. There is nothing to be done short of a heart transplant of a blank check.

The Speech of a Grown-Up President

My Fellow Americans:

I come before you tonight as the President of all the people, Republican, Democrat, and Independent. Just as your Commander in Chief is responsible for our national defense, so must  he or she guarantee the full faith and credit of the United States of America.

We are now engaged in a national debate over the future of our country. In this debate, we have put forth a vision of a country in which its government forcefully provides for the health and welfare of our people. The opposition Party puts forward a different vision of smaller government with more self reliance of the people. This is a legitimate and valuable political debate. In our democracy such issues are resolved by the ballot box, and the voters will be called upon to decide in the looming 2012 election.

Issues such as the proper size of government, how that government will pay for itself, and its expanding role in health care and regulation are not resolved overnight. They must be carefully debated for the voter to decide.

We have engaged this debate. We can see how difficult it is to resolve, but in the mean time, we must make sure that this healthy and ongoing debate does not harm the full faith and credit of the United States of America. We cannot allow politics, in any way, to jeopardize our national creditworthiness. We must remove any fear mongering on this issue from the political discourse.

Therefore, I have instructed the Secretary of Treasury to prepare a plan that insures that due interest and principle by paid to all of our bondholders, both at home and abroad, until we reach an agreement on raising the debt limit. We have sufficient revenues incoming to make sure we will meet our debt obligations as a nation.

I have also instructed my administration that all social security checks be sent out on schedule. The American people have made their Social Security Contributions into the Social Security Trust Fund in good faith, and we must honor our obligations to them as well. The Social Security Trust Fund is solvent, as we have stated in the past. There is no reason not to meet our obligations to retirees and other recipients who rely on these checks.

The plan that the Secretary of Treasury is preparing will prioritize our needs and see us through this difficult period, if necessary, by minimizing the impact of any disruptions in government services.

In closing, let us resolve this national debate in an orderly fashion through normal political processes without scare tactics and fear mongering, which will only make things worse. As President Roosevelt said many years ago: “We have nothing to fear but fear itself.”  We have seen the harmful effects of fear in the past three years. We have had enough of it.

Must We Sacrifice Social Security Checks? Whatever Became of the GAO Report on Waste and Duplication in the Federal Government?

Today’s Sunday talk shows obsessed with the possibility of default. Treasury Secretary Geithner made the rounds with doomsday warnings: The elderly will not get social security checks, the unemployed will miss unemployment benefits, and the poor will be denied medical care, if the rascally Republicans force a default on sacred government debt.

Geithner refused to spell out what steps his treasury department is taking to prepare for the possibility that a deal will not be reached in time. According to him, there are no plans. There is no prioritization. The only possibility is a disaster from which we will not recover. Surely, it is time for the recalcitrant Republicans to come to their senses.

We seem to have forgotten the May 25, 2011 GAO report entitled “Potential Duplication in Government Programs, Save Tax Dollars, and Enhance Revenue.” Less than two months have passed since its release. Washington, I guess, has a very short memory span.

The GAO report was prepared to meet the statutory requirement to identify federal programs, agencies, offices, and initiatives—either within departments or government-wide—that have duplicative goals or activities. In this report, the GAO identified 81 areas of opportunities for eliminating duplication, reducing operational costs, or enhancing revenue. Although the total savings are difficult to add up, they equal hundreds of billions of wasted federal dollars.

The reaction of one Senator to the report sums it up well: “At a time when our country has an unsustainable debt of $14 trillion, there simply can be no excuse for such waste, duplication, and inefficiencies.”

I include for Secretary Geithner a link to the GAO appendix (Appendix 1) that identifies federal-government waste and duplication. (http://www.gao.gov/new.items/d11635t.pdf)

In particular, he might look at the seven agencies for the homeless, ten agencies on teacher quality, twenty four agencies on federal data, thirty one agencies for war fighter urgent needs, and five agencies for surface transportation.

I recommend to the treasury secretary that he consult this appendix to prepare for the doomsday scenario. There are more than enough cuts that can be made without jeopardizing the effectiveness of the federal government. More than one agency is already taking care of the problem. In some cases, we have more than thirty doing the same thing.

The treasury secretary is fortunate that the GAO has done his work for him. Let him cut the areas of waste and duplication so that he can send out the social security checks on time.

Media Slant: Guess Which Newspaper Ran Which Story: Wall Street Journal or New York Times?

1. "Grand Bargain Talks Collapse"

WASHINGTON—A high-stakes effort by President Barack Obama and House Speaker John Boehner to hatch a landmark deficit reduction deal collapsed in anger Friday, sending Washington into a weekend of negotiations over how the world's top financial power can make good on its debt obligations.

In a letter to his colleagues, Mr. Boehner said he called off talks with the president. He informed Mr. Obama Friday night he planned to start negotiations with the Senate to seek what would likely be a smaller deal.

"In the end we couldn't connect. Not because of different personalities, but because of different visions for our country,

2. "Debt Ceiling Talks Collapse as Boehner Walks Out"

WASHINGTON — Negotiations over a broad deficit reduction plan collapsed in acrimony on Friday after Speaker John A. Boehner suddenly broke off talks with President Obama, raising the risk of an economy-shaking default.

A visibly angry President Obama, in a hastily scheduled White House news conference, demanded that Congressional leaders come to the White House on Saturday morning. “I want them here at 11 a.m. tomorrow,” he said. “They are going to have to explain to me how it is that we are going to avoid default.”

Answer (if you need an answer: WSJ =1, NYT =2)