Cliff Crisis Averted: Next Crisis—Debt Ceiling

Cliff Crisis Averted: Next Crisis—Debt Ceiling

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Ever feel like it is just one crisis after another? Get used to it.

While everyone focused on avoiding the fiscal cliff, we cracked our head on the debt ceiling. On Monday, the U.S. government reached the statutory limit on how much money it can borrow. Get ready for the next big budgetary fight—and this time expect a much bigger hit to your pocketbook.

Treasury Secretary Timothy Geithner told Congress on Monday that emergency measures were now in effect to prevent Washington from defaulting on its debt. America has begun a “debt issuance suspension period” that would last through February 28, he said. We have less than 60 days to raise the debt ceiling, which is currently set at $16.394 trillion. If we don’t, our creditors will soon stop being paid. A debt default could have drastic implications on how much America pays to borrow money.

Last year, due to concerns over the debt ceiling, a major credit rating agency downgraded U.S. debt. It was a first in U.S. history. It won’t be the last.

Now, after passing an unpopular last-minute “fiscal cliff,” Washington is set for the next set of crisis negotiations. The difference this time is that Republicans seem more determined to tackle government spending—and that means potential reforms to Social Security, Medicare and Medicaid. Any reforms will almost certainly mean cuts to services and payouts. Democrats are sure to oppose. Democrats won the fiscal cliff battle by winning increased government spending and taxation. Who will win the next one?

If you thought the last battle over the debt ceiling was bad, wait till you see what this year’s could bring. And the debt ceiling crisis is only the beginning.

There is also the looming sequester issue—a legacy of 2011’s debt ceiling battle. Sequester involves $110 billion worth of automatic, across the board spending cuts to every single government department. The cuts were scheduled for January 1, but due to an inability to agree on how to avoid the cuts, Congress postponed the date two months.

Indebted America has few choices to deal with its budget issues. It can cut spending—and hurt the economy. It can raise taxes—and hurt the economy. It can increase borrowing—and hurt the economy. It can print money—and hurt the economy. Alternatively, it can do some combination of the four—and hurt the economy. Some options hurt more than others. Some hurt more immediately. Others hurt much later.

But here is the point: There is no way to avoid the consequences of our debt. Political attempts to avoid paying the price will make matters worse, not better. There will be no end to the crisis. It will be one crisis after the other until you think they have gone on forever. This is America’s future. This is reality. You can choose to prepare for it, or suffer the worst of it.

Preparing for it would involve reading: Does God Exist?, Repentance Toward God and The Song Of Songs—God’s Greatest Love Song.

A Lot of People Lie a Little

“Why We Lie” is an interesting piece in the Wall Street Journal from last May by Dan Ariely, author of The (Honest) Truth About Dishonesty. It exposes an ugly truth about human nature: that people tend to cheat—but only to the degree that they can still consider themselves honest. He writes,

Over the past decade or so, my colleagues and I have taken a close look at why people cheat, using a variety of experiments and looking at a panoply of unique data sets—from insurance claims to employment histories to the treatment records of doctors and dentists. What we have found, in a nutshell: Everybody has the capacity to be dishonest, and almost everybody cheats—just by a little. Except for a few outliers at the top and bottom, the behavior of almost everyone is driven by two opposing motivations. On the one hand, we want to benefit from cheating and get as much money and glory as possible; on the other hand, we want to view ourselves as honest, honorable people. Sadly, it is this kind of small-scale mass cheating, not the high-profile cases, that is most corrosive to society.

As Herbert Armstrong said, “Human nature wants to be good—or think it is good—but it does not want to do good.”

This widespread, small-potatoes cheating has an enormously corrosive effect on society. It makes you shake your head to think about it.

In short, very few people steal to a maximal degree, but many good people cheat just a little here and there. We fib to round up our billable hours, claim higher losses on our insurance claims, recommend unnecessary treatments and so on.Companies also find many ways to game the system just a little. Think about credit-card companies that raise interest rates ever so slightly for no apparent reason and invent all kinds of hidden fees and penalties (which are often referred to, within companies, as “revenue enhancements”). Think about banks that slow down check processing so that they can hold on to our money for an extra day or two or charge exorbitant fees for overdraft protection and for using atms.All of this means that, although it is obviously important to pay attention to flagrant misbehaviors, it is probably even more important to discourage the small and more ubiquitous forms of dishonesty—the misbehavior that affects all of us, as both perpetrators and victims. This is especially true given what we know about the contagious nature of cheating and the way that small transgressions can grease the psychological skids to larger ones.

It reminded me of Dennis Leap’s terrific article “To Lie or Not to Lie.”

Pope Brings English Church to Heel

Pope Brings English Church to Heel

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Total victory for the pope as the English Catholic Church finally submits to the Vatican.

It’s hard to think of a more complete victory in the Vatican’s long-running battle with the English Catholic Church. To fully understand the magnitude of this victory, please bear with me while we go over some history first.

Catholic officials in Rome have long been frustrated by England’s liberal Catholic bishops.

One of the biggest reasons for this is the liberals’ refusal to follow Rome’s strict line on homosexuality. Archbishop of Westminster Vincent Nichols, the senior Catholic leader in England, has consistently given the impression that the Catholic Church supported homosexuals forming marriage-like unions in the form of civil partnerships. In approving homosexual partnerships, Nichols has been accused of defying Vatican guidelines.

But perhaps more brazenly, Nichols has consistently supported the Soho Masses. These masses deliberately cater to homosexual Catholics—again prompting accusations that Nichols and the English bishops are defying the Vatican. The Catholic Herald’s Dr. William Oddie called the issue “the most potentially inflammatory source of division between Rome and Westminster.”

Last year, Gerhard Ludwig Müller was appointed prefect of the Congregation for the Doctrine of the Faith. Formerly known as prefect of the Supreme Sacred Congregation of the Roman and Universal Inquisition, this role is the Vatican’s enforcer. And one of Müller’s top goals was, reportedly, to end the Soho Masses.

A German magazine, Katholisches Magazin für Kirche und Kultur, wrote that Müller “intends, very firmly, to address the problem of the Mass.”

The other big bone of contention between the Vatican and the English bishops has been the bishops’ unenthusiastic welcome for Anglicans defecting to Rome.

Pope Benedict xvi personally orchestrated the creation of a personal ordinariate, to allow defecting Anglicans to retain their traditions. He even donated a quarter of a million dollars toward its upkeep.

But the English bishops have refused to support it. They’ve given the ordinariate no buildings to hold its own church services in. The last thing the English Catholics want is for the Church of England’s most conservative members and priests to cross over into the Catholic Church. That’s not to say that England’s Catholics are liberal. But the bishops are, and they don’t want Anglican conservatives.

Many Catholic commentators believe that Nichols’s defiance over these issues is the reason he is still Archbishop Nichols, not Cardinal Nichols—a promotion he traditionally would have received by now.

With all that in mind, now appreciate the magnitude of the English church’s January 2 announcement.

The Soho Masses will be shut down, and the building they were held in will be given to the Anglican Ordinariate.

The Vatican suddenly got its way on the two issues that have frustrated it for years. The Soho Masses are gone, and, for the first time, Anglicans returning to Rome will be able to worship in their own church building, all with one stroke. It’s hard to think of a better sign that the Vatican is now getting its way in England.

If the change translates into a more welcoming attitude toward the ex-Anglican Catholics, many more may cross over into the Catholic Church.

Just a few days earlier, in his Christmas Eve message, Nichols strongly condemned the government’s plan to introduce same-sex “marriage”—bringing himself back in line with the Vatican.

This all shows the progress the Vatican has made in reasserting control over the more liberal areas of the church. As we’ve point out before, the pope is cementing his control over the church. With England brought to heel, this process seems almost over.

With unity imposed on the church, it will be ready for its new public role. The Trumpet has long forecast that the Catholic Church will rise in power. Now that the dissenters have been defeated, it’s ready for this rise.

For more information on the role the Catholic Church will soon play in world events, read our article “Europe: The Next Chapter.”

Iranian Meddling in the Gulf Triggers GCC Coalition

Iranian Meddling in the Gulf Triggers GCC Coalition

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The Gulf Cooperation Council (gcc) has condemned Iran’s interference in the region and is working together to set up a unified, military command.

At the conclusion of a two-day summit December 24-25, the six-member, Saudi-led gcc—which includes Bahrain, the United Arab Emirates, Oman, Qatar and Kuwait—issued a statement that slammed “the continuing Iranian interference in the affairs of the Gulf Cooperation Council’s states and called on Iran to stop these policies.”

Iran has denied any interference in the Gulf—a region that Iran clearly sees as its own backyard, as Reuters reports. Of particular note is Iran’s “backyard” pastime in the nation of Bahrain. Bordering Saudi Arabia and in the neighborhood of the rich Saudi oil fields, Bahrain is strategic for maintaining the economic and geopolitical influence of the Saudis. Bahraini Foreign Minister Khalid Bin Ahmed Bin Mohammed Al Khalifa commented on the “very serious threat” that Iran poses: “Politically, [there is] lots of meddling in the affairs of gcc states … and there is of course the looming nuclear program. [T]he threat level is quite high, but we are ready if faced with circumstances that require action.”

One way the Gulf Cooperation Council is getting “ready” is by integrating its members’ foreign and security polices, and enhancing defense cooperation. The gcc summit communique said the Council had “supported the creation of a unified military command that organizes and plans and leads the ground, naval and air forces.”

The Wall Street Journal wrote that “Saudi Arabia is rallying Muslim nations across the Middle East and Asia to join an informal Arab alliance against Iran.”

Back in 1994, based on Bible prophecy Trumpet editor in chief Gerald Flurry said many of these nations will comprise the prophesied Psalm 83 alliance. Watch for that alliance to team up with Germany against an Iranian-led bloc of nations and, ultimately, against Israel. For the biblical identities of the states that will make up this alliance and more, request Mr. Flurry’s booklet The King of the South.

America’s New Best Friend?

America’s New Best Friend?

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The United States is abandoning Britain in favor of a new friend—the European Union.

British Euroskeptics have long dreamed of leaving the European Union and forming a new relationship with the Commonwealth and the United States. Unlike the EU, this alliance would share Britain’s fundamental values—their laws flow from the same tradition. It would be a trade alliance that would benefit all involved.

The problem is, America’s not interested. It’s more pro-European than most of Europe is.

America’s response to Britain’s growing Euroskepticism shows that it views Britain as a bridge to Europe, rather than an important ally in its own right. If Britain leaves the EU, its usefulness to America is over.

The UK Independence Party is growing in popularity. Prime Minister David Cameron recently said that a British EU exit was “imaginable.” Faced with this shift, U.S. President Barack Obama himself is reportedly lobbying Cameron to keep Britain in.

The Telegraph’s diplomatic correspondent Alex Spillius reported that “the issue was raised by President Barack Obama in a video-conference call with the prime minister” on December 18.

American diplomats are also raising the issue. “It is important to state very clearly that a strong UK in a strong Europe is in America’s national interest,” Spillius reported a “senior U.S. administration official” as saying.

The sheer hypocrisy of a nation formed because it didn’t want foreign control over its affairs (no taxation without representation) telling Britain that it must subordinate itself to Brussels has offended many in Britain. But America’s shift in priorities has some logic. Britain used to be a major power, and the European Union used to be a bickering trading organization. Now, Britain is steadily shrinking in power and prestige while Europe is growing into a more powerful political union (though the bickering continues.)

Britain doesn’t have the clout that it used to, so America is looking for a new ally that does.

The fact is, the U.S. administration no longer sees Britain as its friend. Its friend is Europe. The administration’s European track record proves it.

Washington-based foreign affairs correspondent Nile Gardiner details this track record in a blog post for the Telegraph. In January 2011, America’s ambassador to the UK, Louis Susman, said, “I want to stress that the UK needs to remain in the EU.”

Stronger British participation in Europe “is crucial if, together, we are going to meet all the global challenges facing us, including climate change and security,” he said. “But let’s be clear: All key issues must run through Europe.”

In 2010, U.S. Vice President Joe Biden said Brussels could claim the title of “capital of the free world.” He praised steps toward closer integration, like the signing of the Lisbon Treaty. “The Obama-Biden administration has no doubt about the need for and strongly supports a vibrant European Union,” he said. “We believe it’s absolutely essential to American prosperity and long-term security.”

Now, America’s support for Europe could be set to move beyond rhetoric. Many commentators expect a new U.S.-EU trade initiative to be announced early this year.

“Despite approving noises from both sides of the ocean over the years, a comprehensive EU-U.S. trade deal has never seriously been attempted,” wrote the Wall Street Journal last month. “That could be about to change, and a good thing too.”

Both sides see a transatlantic free-trade deal as a cost-free way to boost the economy.

European Commissioner for Trade Karel De Gucht recently said that “Perhaps not a marriage, but certainly a closer partnership” between the EU and the U.S. was in order. De Gucht is still discussing the feasibility of such a plan with U.S. authorities, but said, “I am confident we will be able to deliver it very soon.”

The idea also has strong support in the U.S. In November, U.S. Secretary of State Hillary Clinton supported the idea, saying, “If we work at it, and if we get this right, an agreement that opens markets and liberalizes trade would shore up our global competitiveness for the next century, creating jobs and generating hundreds of billions of dollars for our economies.”

President Obama, European Commission President José Manuel Barroso and European Council President Herman Van Rompuy called for “a bold initiative to expand trade and investment” in a joint statement earlier in the year.

“2013 presents the best moment for a serious U.S. trade initiative since Mr. Obama was first elected,” wrote Edward Luce in the Financial Times just over a week ago. “Most European governments, including the French and particularly the Germans and British, are also enthusiastic.”

Luce sees the deal as more than an economic partnership. He heralded “the geostrategic benefits to what is likely to be called the ‘transatlantic partnership.’”

“By 2030, Asia’s economy will be larger than that of the U.S. and EU combined according to the U.S. National Intelligence Council’s Global Trends report,” he wrote.

“By acting now when they still account for half the world’s economy, the U.S. and EU still possess the leverage to set the global standards that others, including China, are likely to follow,” he continued. “Five years on, it may be too late. In the words of a senior EU official, the round would be ‘strategic not tactical, global not bilateral.’”

Such a free-trade deal would not be easy. It would require many compromises, which Brussels may not be willing to make. But the recent surge in interest in a transatlantic free-trade partnership shows that America is keen on pursuing an alliance with Europe.

Even America’s so-called “Asian pivot” is pushing it toward this alliance. It’s a little counterintuitive, but if America wants to focus more attention on Asia, then it must have a strong, reliable partner across the Atlantic to cover for it. This is why America is trying to persuade EU countries to spend more on defense, rather than relying on the U.S. The U.S. seems like it would even favor a strong military union in Europe.

It’s still a bit of an exaggeration to say the EU is now America’s new best friend. It’s the direction transatlantic relations are heading, not a destination that has already been reached.

But they will get there. Two important trends the Trumpet has watched for years are the breakdown in relations between Britain, America and Israel, and America’s growing love for Europe, and especially Europe’s leader, Germany.

America can see that its global power is diminishing. But rather than addressing the cause of it, it is trying to build up a new power in Europe.

The loss of America’s power ultimately gets back to individual morality and a refusal to trust God for deliverance. This loss of power isn’t causing the U.S. to turn back to God in repentance; instead America is turning to its new European ally.

Bible prophecy reveals that this trust will be betrayed in a frightening and horrible way, but it will teach America a vital lesson. The American people will ultimately learn to trust God, not other nations, for protection.

For more information on how America will learn this lesson, see Trumpet editor in chief Gerald Flurry’s article “A Special Warning: Germany’s Long History of Deadly Deceit.”

U.S. Avoids Fiscal Cliff for Fiscal Nuclear Explosion

The United States Senate passed legislation early on Tuesday, New Year’s Day, to neutralize across-the-board tax increases and spending cuts that kicked in at midnight.

The pre-dawn vote was heavily one-sided in favor of the legislation with 89 senators voting for and eight against.

The Senate passage set the stage for a final showdown in the House of Representatives, where a vote on the legislation is expected later on Tuesday or Wednesday.

Without legislation, economists in and out of government had warned of a possible new recession and spike in unemployment if the fragile U.S. economy were allowed to fall over the so-called “fiscal cliff” of tax increases and spending cuts.

Shortly after the Senate vote, President Barack Obama said the agreement was the right thing to do and encouraged the House to pass it “without delay.”

Under the deal, taxes would remain steady for the middle class, but increase for individual incomes over $400,000 and incomes over $450,000 for couples.

Spending cuts totaling $24 billion aimed at the Defense Department and domestic programs would be deferred.

In essence, this deal does nothing to fix the economy or America’s debt problem. As one analyst said, it is like a 400-pound diabetic deciding to eat more vegetables, and then ordering meat-lovers pizza with olives—and then not even eating the olives.

Don’t expect politicians to take any meaningful action on the economy until another full-blown crisis hits. And by then, just as it was in 2008, it will be too late.

In the year ahead, look for the U.S. economy to continue to struggle, because no one is willing to face the cause of the crisis.

As President Abraham Lincoln said, “Those nations only are blessed whose God is the Lord.” President Lincoln was quoting Psalm 33:12, and as he indicated, there is a direct link between morality and prosperity.

Without national repentance and a return to God’s law, no amount of voting or legislation will permanently fix the very broken U.S. economy. For a clear perspective on the current U.S. economy, read the article, “‘They Can Print Money.’