Obama orders cuts by Cabinet

Boston Globe - ?5 hours ago? AP And Globe Staff / April 21, 2009 Convening his first Cabinet meeting yesterday, President Obama ordered his agency chiefs to join many American families in penny-pinching, but acknowledged that slicing at least $100 million in administrative costs ...

President Obama has asked his cabinet to come up with 100 million in savings over a 90 day period. This sure sounds good on the surface, until you realize our budget is running around 200 billion per month or 600 billion in 90 days. If this is broken down to be understandable to most of us, it looks like this: 600,000,000,000/100,000,000 To put it another way it amounts to one dollar in savings for every six thousand spent.
Wow, I feel better already!
President Obama promised the country a sharp knife in dealing with the budget, but it seems like he got the butter knife out instead.
"To put those numbers in perspective, imagine that the head of a household with annual spending of $100,000 called everyone in the family together to deal with a $34,000 budget shortfall," Harvard University economist N. Greg Mankiw, a Bush administration official, wrote on his blog. "How much would he or she announce that spending [be] cut? By $3 over the course of the year -- approximately the cost of one latte at Starbucks. The other $33,997? We can put that on the family credit card and worry about it next year."

I predict future happiness for Americans if they can prevent the
government from wasting the labors of the people under
the pretense of taking care of them.
Thomas Jefferson

LAYOFFS AND DOWNSIZING....

Has anyone out there ever been laid-off or downsized?

I can tell you one group that never has suffered this indignity. Our ELECTED REPRESENTATIVES!!

When a company falls on difficult times, one of the things that seems to happen is they reduce their staff and workers. The remaining workers need to find ways to continue to do a good job or risk that their job would be eliminated as well. Wall street, and the media normally congratulate the CEO for making this type of "tough decision", and his board of directors gives him a big bonus.

Our government should not be immune from similar risks.

Therefore: Reduce the House of Representatives from the current 435 members to 218 members and Senate members from 100 to 50 (one per State). Also reduce remaining staff by 25%.

Accomplish this over the next 8 years. (two steps / two elections) and of course this would require some redistricting.

Some Yearly Monetary Gains Include:

$44,108,400 for elimination of base pay for congress. (267 members X $165,200 pay / member / yr.)

$97,175,000 for elimination of the above people's staff. (estimate $1.3 Million in staff per each member of the House, and $3 Million in staff per each member of the Senate every year)

$240,294 for the reduction in remaining staff by 25%.

$7,500,000,000 reduction in pork barrel ear-marks each year. (those members whose jobs are gone. Current estimates for total government pork earmarks are at $15 Billion / yr)

The remaining representatives would need to work smarter and would need to improve efficiencies. It might even be in their best interests to work together for the good of our country?

We may also expect that smaller committees might lead to a more efficient resolution of issues as well. It might even be easier to keep track of what your representative is doing.

Congress has more tools available to do their jobs than it had back in 1911 when the current number of representatives was established. (telephone, computers, cell phones to name a few)

Note:
Congress did not hesitate to head home when it was a holiday, when the nation needed a real fix to the economic problems. Also, there were 3 senators that were not doing their jobs while on the campaign trail for 18+ months) but were still accepting full pay. These facts alone support a reduction in senators & congress.

Summary of opportunity:

$ 44,108,400 reduction of congress members.

$282,100, 000 for elimination of the reduced house member staff.

$150,000,000 for elimination of reduced senate member staff.

$59,675,000 for 25% reduction of staff for remaining house members.

$37,500,000 for 25% reduction of staff for remaining senate members.

$7,500,000,000 reduction in pork added to bills by the reduction of congress members.

$8,073,383,400.00 per year, estimated total savings. (that's 8-BILLION just to start!)

Big business does these types of cuts all the time.

If Congresspersons were required to serve 20, 25 or 30 years (like everyone else) in order to collect retirement benefits there is no telling how much we would save. Now they get full retirement after serving only ONE term.

IF you are happy how the Congress spends our taxes, then just ignore this post. IF you are NOT at all happy, then I assume you know what to do.

Next Week: The Administration! What we might call the CEO and Staff!

A.M.

YOU'RE FIRED!

John Deere Wins New Contract!!!!

Despite the cozy relationship that this Administration has with Caterpillar it has awarded it's first agricultural contract for new machinery to rival John Deere.
In his promise to "work smart and make government work smart", President Obama has chosen John Deere to build new machinery needed for the Tax Stimulus Plan.
"We have had a lot of proposals that involved new design and manufacturing, that would only push up the cost of the equipment needed. The good folks at John Deere have come up with a plan to inexpensively modify an old piece of equipment with readily available parts. This is American ingenuity at work, and the kind of forward thinking all of us need to be doing!"
When asked what he thought of the first test run with the prototype the President stated:
"Actually I just kind of teared up looking at it".

John Deere has renamed it's 1941 Manure and Compost Spreader and promised to retro fit all existing equipment as a way of helping this Administration "Work Smart for the American People".
What we will see with the Tax Stimulus Plan;

Workers who make less than $75,000 a year (or married couples who make $150,000 or less) will receive $400 tax credits in 2009 and 2010. Those who make more will receive reduced amounts. But instead of mailing out checks, as the Bush administration did with its stimulus plan last year, the government will withhold a little less -- leaving average workers with perhaps $8 extra per week.

Health insurance subsidies for the unemployed could also have a direct effect, but even with the federal help many may find it hard to afford continued coverage. Workers who lose their jobs must arrange with their employers to continue the coverage and must pay the premiums themselves -- a hefty outlay even with the government now picking up 65% of the cost for nine months for individuals earning up to $125,000 a year ($250,000 for couples). Of course we have already extended the length of time that benefits can be collected.

The federal government will deliver $54 billion in aid to cash-strapped states, with some of the money available to prop up state budgets, help maintain services and keep employees on the job.

Other money could help keep teachers and day-care workers on the payroll. That alone could save or create hundreds of thousands of jobs nationwide, Democrats say.

Counties, cities and municipalities that receive a chunk of stimulus money are expected to green-light so-called shovel-ready projects, using workers and equipment that otherwise might sit idle. The U.S. Conference of Mayors has projected that such projects could yield 1.6 million jobs by the end of next year.

It is pretty obvious that 'creating and saving' jobs means government jobs!

This is known in the business world as more overhead.

Obama sets executive pay limits

Obama Lays Out Limits on Executive Pay

"For top executives to award themselves these kinds of compensation packages in the midst of this economic crisis is not only in bad taste — it’s a bad strategy — and I will not tolerate it as President. We’re going to be demanding some restraint in exchange for federal aid — so that when firms seek new federal dollars, we won’t find them up to the same old tricks".
--Barack Obama

The plan, which represents the most aggressive assault on executive pay by federal officials, includes salary caps of $500,000 for top executives at firms that accept "extraordinary assistance" from the government.

Sounds good doesn’t it? Let’s punish those bad boys and make ‘em
Hurt! But is there any teeth to this pay cap or is it just empty rhetoric?

Let’s look at how the new plan will affect James Owens, one of the members of President Obama’s Economic Recovery Team.

"The board will be chaired by former Federal Reserve Chairman Paul Volcker. Its members include Jeffrey Immelt, chief executive of General Electric, and James Owens, chief executive of Caterpillar. Both companies have strong sales around the world, though both are coping with hard times amid the slowing global economy; Caterpillar said last month that it would cut 20,000 jobs".

According to Forbes, this is James Owens compensation package for
2007. Now personally, I don’t care how much any CEO or Executive
Makes. I think that is between them and the shareholders. But, just for the heck of it, let’s see how this ‘salary cap’ will affect him.

$ 1,512,504.00 Salary
$ 300,000.00 Bonus
$ 0.00 Other Annual Compensation
$ 0.00 Long term incentive plan payouts
$ 918,626.00 Restricted stock awards
$ 0.00 Security underlying options
$ 221,307.00 All other compensation
$ 7,136,911.00 Option awards $
$ 4,442,998.00 Non-equity incentive plan compensation
$ 2,575,395.00 Change in pension value and nonqualified deferred
compensation earnings
$17,107,741.00 Total Compensation

So at first glance, it appears that Mr. Owens would lose $1,012,504.00.
Or would he? Might he just put oh, lets say $200,000 into his bonus plan and $800,000
into the item labeled 'Other Annual Compensation'?
Even if he did take the 1 million dollar pay cut, does it really hurt him? Of course not. CEO
salaries are nothing more than 'walking around money, for many of them.
I am all for CHANGE and a better method of doing things,but I firmly believe that I don't appreciate being misled by meaningless DoubleSpeak.

Where's the beef?