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Venezuela's public finances are unravelling, with oil prices at $40 a barrel, while the national budget is calculated at $60 a barrel. Inflation is running at over 30 per cent, yet with the new measures Mr Chavez is seeking to ensure that his core support, the poor, can still fill their shopping baskets with food.
"If any industry wants to ride roughshod over the consumers, with a view to getting better dividends, we are going to act," said Carlos Osorio, the national superintendent of silos and storage. "For the government, access to food is a matter of national security."
Production quotas and prices have now been set for cooking oil, white rice, sugar, coffee, flour, margarine, pasta, cheeses and tomato sauce.
White rice, the staple for many Venezuelans, can now only be sold at a price of 2.15 bolivares (71p) per kilo. Private companies insist that production of that kilo costs 4.41 bolivares (£1.46) and that government regulations are impossible to fulfil and companies will quickly go broke. Companies that are dedicated to rice production must ensure that 80 per cent of their efforts are dedicated to white rice. The new regulations set production percentages, as companies were rebranding their products to avoid the government controls, like flavouring the rice, as the price restrictions apply only to white rice.
"Forcing companies to produce rice at a loss will not resolve the situation, simply make it worse," said Luis Carmona of Polar, a rice company that has been singled out by the government for trying to sidestep restrictions.
Government price controls on basic goods have been in place, in various forms, since 2003. But the restrictions have forced Venezuela to become increasingly reliant on imports of these products as local farmers will not supply the selected food staples at government prices.
Mr Chavez last month won a referendum allowing him to stand indefinitely for re-election. With that now achieved the Venezuelan leader, who has vowed to turn his South American nation into a model Socialist state, is now taking some unpopular decisions needed to stabilise his floundering economy.
The budget will triple the FY09 deficit of $459 Billion to $1.8 trillion for FY 10: the highest ever in dollar terms - amounting to a 12.3 percent share of the economy, which is the largest since 1945.
Entitlement spending will increase from $1.6 Trillion to $2.5 Trillion; a 73% increase! More entitlements = more socialism = power grab = buying votes with tax payer money!
Currently, if someone in the top bracket makes a gift to charity, for instance, they get a 35 percent write-off. Under Obama's plan, beginning in 2011, they would get a smaller write-off at the 28 percent rate - a change that worries charity groups.
The Bush tax cuts will expire for families earning more than $250,000 a year, which would raise the highest rate from 35 percent to 39.6 percent. (This includes many small business owners; you know the people that actually create jobs. This will have a negative impact on unemployment.)
Obama would also impose a 20 percent capital-gains rate on top earners, up from the current 15 percent.
Taxes on the wealthy would raise $635 billion over 10 years, with most of the funds going to tackle health care, which is sucking up an increasing share of the national budget and household finances.
Corporate tax increases will provide the Fed with nearly $350 billion. (Keep in mind, corporatios do not pay taxes; they pass the cost on to the consumer. So essentially, it's an economic stalemate, but will allow Obama more entitlements.)
The budget forecasts a jump in government spending by 7 points - to 28 percent of the total economy this year.
Proof once again that Democrats want to enlarge welfare rolls, destroy the lives of citizens, make everyone poorer, and create a permanent underclass that they can count on for votes.
What they've done is murder welfare reform in the middle of the night!
Prior to 1996, the way welfare worked: the more people a state put on welfare, the more money they received from the Federal government.
With the reforms, states were issued a flat amount of money. If they reduced the welfare rolls, they got to keep the surplus, if the rolls went up, the states would have to deal with that.
What the CRAPulus Bill has done, it reverse this completely.
The Under Cover of Darkness Generational Theft Act of 2009 provides that for every additional person a state puts on welfare, the Federal government will cover 80% of the cost.
"They're effectively bribing the states to raise their welfare rolls."
Now why do you suppose President Obama and the Liberals would want to encourage the states to increase their welfare rolls?
I've said it before and I'll say it again. They don't want people to succeed; they want as many people as possible dependant on the government. The more people who remain underprivileged and shackled to Uncle Sam's wallet, the more votes the Democrats can secure.
It's all very simple, albeit highly clever on the part of Democrats. Yes, it's true the "Stimulus" bill has absolutely nothing to do with helping the American economy and it has everything to do with establishing a permanent voting majority.
This is socialism, folks! In just one month Obama and Pelosi have successfully altered the philosophy and foundation of American society.
Yet again, we have proof that the Obama-Pelosi CRAPulus Generational Theft Act of 2009 has nothing to do with with creating jobs and stimulating the economy.
Simply put, it's an Orwellian attempt to establish a permanent voting block of Americans reliant on government. AKA Socialism, bordering on Totalitarianism.
And yet again, we have to rely on our fair and balance English journalist for the truth.
RONALD REAGAN started it, Bill Clinton finished it and last week Barack Obama was accused of engineering its destruction. One of the few undisputed triumphs of American government of the past 20 years – the sweeping welfare reform programme that sent millions of dole claimants back to work – has been plunged into jeopardy by billions of dollars in state handouts included in the president’s controversial economic stimulus package.
...
Robert Rector, a prominent welfare researcher who was one of the architects of Clinton's 1996 reform bill, warned last week that Obama’s stimulus plan was a “welfare spendathon” that would amount to the largest one-year increase in government handouts in American history.
Douglas Besharov, author of a big study on welfare reform, said the stimulus bill passed by Congress and the Senate in separate votes on Friday would “unravel” most of the 1996 reforms that led to a 65% reduction in welfare caseloads and prompted the British and several other governments to consider similar measures.
...
The dangers are beginning to pile up for the novice president and his struggling economic crew. Tim Geithner, his treasury secretary, tripped up with opaque attempts to explain how the administration would fix the banking crisis, while from every corner of the country there were alarming indications that increased government intervention in the lives of ordinary Americans could prove an invitation to waste.
In Wisconsin, the state that forged a pioneering path in welfare reforms in the 1990s, residents were astonished by a newspaper investigation that disclosed that a $340m (£236m) programme offering taxpayer-financed child care to low-income working parents was riddled with fraud and expensive loopholes. In one case, a family of four sisters who had 17 children between them put all of them together, took it in turns to babysit them and over the past three years claimed $540,000 (£374,000) in perfectly legal state childcare subsidies.
Examples like that fuel American suspicion that so-called “big government” invariably turns out to be inefficient, expensive and easily exploitable. And there has been no bigger government action in the US than the stimulus package presented by Obama.
Few dispute the need for some kind of stimulus, but has Obama got the details right? The Republicans do not think so and, led by Gregg, they are already shunning the president’s bipartisan overtures.
Perhaps more worrying for the president is that some of his natural liberal supporters are not feeling all that confident either. In a telling commentary last week, Paul Krugman, the 2008 Nobel prize-winning economist, declared that Obama’s stimulus victory “feels more than a bit like defeat”.
Krugman added: “I’ve got a sick feeling in the pit of my stomach – a feeling that America just isn’t rising to the greatest economic challenge in 70 years.”
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As conservatives, we can only hope these policies fail. Pray that America escapes from it's Obama-blinders.
It's very important that bloggers unite to report the facts that the MSM will not.
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