Posted by WARREN MOSLER on November 24th, 2009
Yes, the deficit reduction polls are likely having a lot of influence on policy going into the 2010 elections and are a major obstacle to any kind of meaningful recovery.
And, worst of all, it was reported that Budget Director Peter Orszag was also sitting in on these discussions:
By Tony Capaccio and Roger Runningen
Nov. 24 (Bloomberg) — President Barack Obama will announce his decision on the next steps in the war in Afghanistan on or about Dec. 1, according to a U.S. official familiar with the issue.
Defense Secretary Robert Gates, Secretary of State Hillary Clinton and Admiral Michael Mullen, chairman of the Joint Chiefs of Staff, are expected to discuss the decision before Congress that same week, and General Stanley McChrystal, the top U.S. commander in Afghanistan, would testify the following week, the official said.
White House Budget Director Peter Orszag has estimated that each additional soldier in Afghanistan could cost $1 million, for a total that could reach $40 billion if 40,000 more troops are added.
This is clear evidence that budget myths are, indeed, influencing national security issues, and therefore posing a security risk. I’d go so far as to say the deficit terrorists are currently the greatest risk to both national security and national prosperity.
Voters Continue to See Deficit Reduction as Top Priority (Rasmussen) While official Washington has seen many twists and turns in the legislative process this year, voter priorities have remained unchanged. Deficit reduction has remained number one for voters ever since President Obama listed his four top budget priorities in a speech to Congress in February. Forty-two percent (42%) say cutting the deficit in half by the end of the president’s first term is most important, followed by 24% who say health care reform should be the top priority. Fifteen percent (15%) say the emphasis should be on the development of new energy sources, while 13% say the same about education.
1 in 4 Borrowers Under Water (WSJ) The proportion of U.S. homeowners who owe more on their mortgages than the properties are worth has swelled to about 23%. Nearly 10.7 million households had negative equity in their homes in the third quarter, according to First American CoreLogic. Home prices have fallen so far that 5.3 million U.S. households are tied to mortgages that are at least 20% higher than their home’s value, the First American report said. More than 520,000 of these borrowers have received a notice of default, according to First American. Most U.S. homeowners still have some equity, and nearly 24 million owner-occupied homes don’t have any mortgage, according to the Census Bureau. More than 40% of borrowers who took out a mortgage in 2006 are under water. Even recent bargain hunters have been hit: 11% of borrowers who took out mortgages in 2009 already owe more than their home’s value.
AP-GfK Poll: Debt turning shoppers into Scrooges (AP) 93 percent of Americans say they’ll spend less or about the same as last year, according to an Associated Press-GfK poll. Half of all those polled say they’re suffering at least some debt-related stress, and 22 percent say they’re feeling it greatly or quite a bit. That second figure is up from 17 percent just last spring. 80 percent say they’ll use mostly cash to pay for their holiday shopping.
PC shipment forecast raised as 3Q sales pick up (AP) A rebound in purchases of personal computers worldwide will lead to a 2.8 percent increase in shipments this year. Gartner Inc. sees worldwide PC shipments topping 298.9 million in 2009, a reversal from its prior forecast of a 2 percent decline. PC shipments fell in the first half of this year. Gartner sees shipments for 2010 rising 12.6 percent to 336.6 million. But the value of computer sales is expected to drop by 10.7 percent to $217 billion this year because manufacturers are cutting prices to move product.
Businesses still cautious on borrowing (Reuters) The Equipment Leasing and Finance Association’s capex financing index fell to $4.3 billion in October, down 32.8 percent from last October and down 8.5 percent from September. The group said the percentage of borrowers delinquent 30 days or more on their capex loans, leases or lines of credit rose to 4.2 percent last month, up from 3.6 percent last year but down from 5.6 percent in September. Charge-offs as a percentage of all receivables rose to 1.7 percent in October, from 1.36 percent last year but down from 3.01 percent in September. Only 66.2 percent of applicants got the green light from lenders in October, down from 71.7 percent last year and 67.9 percent in September. More than half the money invested in plants, equipment and software in the United States in any given year is financed with loans, leases and lines of credit.