In March, ABC News’ Website reported that “The top tax bracket for U.S. corporations stands at 35 percent, one of the highest rates in the world. So how is it possible that a giant of American business, General Electric, paid nothing in federal taxes last year, even as it made billions in profit?” the story asked. And it then questioned if GE CEO, Jeffrey Immelt, should be advising the president on business.
The story continued, “GE's success at avoiding taxes is nothing short of extraordinary. The company … earned $14.2 billion in profits in 2010, but it paid not a penny in taxes because the bulk of those profits, some $9 billion, were offshore.”
ABC was unable to connect the dots between the U.S. corporate tax rate of 35 percent, which it noted is “one of the highest rates in the world,” and the fact that most of GE’s profits come from operations that the company owns outside the U.S. Indeed, GE is a major sore spot among those who believe that heavily taxing corporations actually makes sense, and who complain that some corporations pay little or no taxes.
Among countries with a lower corporate rate than the U.S. are Mexico, Canada, Chile and Ireland – 30, 29.5, 17, and 12.5 percent respectively. Only Japan, at 39.5 percent, has a higher rate than the U.S.
You might expect an organization like ABC News, that has both a staff of professionals and the obligation to provide Americans with accurate and relevant information, to understand the topics it covers, like business and taxes. But ABC and nearly all of the major media either do not understand the intricacies of business and taxation, or an honest discussion of those topics gets in the way of their agenda. It’s no wonder the American people don’t understand business and taxation, being continually misinformed by the American media.
Why do so many Americans think taxing business is a good thing? Is it the widely held idea that the owners of businesses that pay little or no tax are collecting “ill-gotten” gains? After all, we have exempted 51 percent of U.S. households from paying personal income tax, so where is the money to run the government going to come from if not from businesses?
Corporate taxation enthusiasts think corporations are greedy for wanting to pay less in taxes. But businesses have to keep expenses as low as possible in order to make a reasonable profit and keep their doors open, and taxes are one of the expenses they need to control, a big one.
Consider how tax rates affect a business. A company with $5 million of taxable income will pay $1,750,000 in the U.S. at 35 percent, but only $625,000 in Ireland at 12.5 percent. To businesses, Ireland’s lower rate looks pretty appealing, helping them keep expenses low, and saying in effect, “Move your company to Ireland. We’ll save you money.”
However, the main thing the “tax the corporations” folks don’t understand is that corporations don’t really pay taxes, an occasional theme here; they just write the check.
A U.S. Treasury research paper titled "A Review of the Evidence on the Incidence of the Corporate Income Tax" looked at three different studies on corporate taxation, and noted the following:
1. It is estimated that 61% of any additional corporate tax is passed on in lower wages in the short run, and around 100% in the long run.
2. Using cross-country panel data from the Luxembourg Income Study, it is estimated that a 10% increase in the corporate tax rate decreases annual gross wages by 7% percent.
3. The results in this paper suggest that corporate tax rates affect wage levels across countries, and that higher corporate taxes lead to lower wages. A 1% increase in corporate tax rates is associated with nearly a 1% drop in wage rates.
The paper concludes: “Corporations don't pay taxes, individuals pay taxes in their roles as shareholders, workers and consumers. Higher corporate taxes translate to lower dividends for shareholders, lower wages for workers and/or higher prices for consumers. According to the empirical evidence presented in this paper, it appears that a substantial burden of increases in corporate taxes fall on the workers employed by corporations. Higher corporate taxes = lower wages.”
Raising corporate taxes is a terrible idea, unless we want prices to remain high or get higher, or want wages to go down, and corporate dividends to be cut.
Put into the context of the on-going failing recovery, raising taxes on corporations, or even keeping the corporate tax rate near the top of world-wide rates will perpetuate the recent pitiful economic performance, not encourage businesses to expand and create jobs.
As the U.S. Treasury research paper noted, over-taxing business hurts workers, shareholders and consumers, and also damages the country by driving business activity to more business-friendly countries, killing jobs and lowering GDP.
Our government spends far too much money, and then punishes businesses and the most productive individuals with ridiculous tax rates to raise the money to pay the bills. It just doesn’t work, and the sooner that reality takes hold, the better for us all.
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Technorati Tags: Taxation, Politics, Liberalism, Economy
Tuesday, June 28, 2011
Sunday, June 26, 2011
Tuesday, June 21, 2011
Education department does more than just
spoil public education
If you thought the biggest offense of the Department of Education has committed was messing up public education, you may be dismayed to learn that it has done much worse than that. According to KXTV News 10 in Stockton, CA, at 6:00 one morning, hearing noise outside his home, “I look out of my window and I see 15 police officers,” Kenneth Wright said.
Wright came downstairs in his boxer shorts as a S.W.A.T team barged through his front door. Wright said an officer grabbed him by the neck and led him outside on his front lawn.
“He had his knee on my back and I had no idea why they were there,” Wright said. According to Wright, officers also woke his three young children ages 3, 7, and 11 and put them in a Stockton police patrol car with him. Officers then searched his house.
“They put me in handcuffs in that hot patrol car for six hours, traumatizing my kids,” Wright said.
And what monstrous, heinous, unspeakable atrocity did Kenneth Wright commit to warrant a S.W.A.T. team breaking down his door at 6 a.m.?
None. He does not have a criminal record and was not even who the S.W.A.T team was looking for that morning. They were looking for his wife, Michelle – his estranged wife.
And what monstrous, heinous, unspeakable atrocity did Mrs. Wright commit to warrant this gross intrusion of an innocent man’s home?
According to the TV station, DOE spokesman Justin Hamilton confirmed that the department did issue the search warrant at Mr. Wright’s home as part of an ongoing criminal investigation, but would not say what crime his estranged wife was suspected of committing. Such searches are utilized for offenses like student aid fraud, embezzlement of federal aid and bribery, the spokesman said.
So, on the mere suspicion that Mrs. Wright may have committed a non-violent crime like bribery, embezzlement or fraud in the student loan program, the DOE’s militarized police force attacked the wrong residence, physically assaulted an innocent man and terrorized him and his three children. Remember that in America we are innocent until proven guilty, and none of those crimes posed any danger, and did not justify a S.W.A.T. team intervention.
This incident invites a few questions:
• Did you know that the DOE utilizes a S.W.A.T. team?
• Did you know that the DOE can issue warrants authorizing deadly force for non-violent crimes without a judge’s authorization, or issue warrants for any reason without a judge’s authorization?
• Do you think this is proper for a non-police agency, or any federal agency?
• What is there within the realm of education policy that could ever justify using armed force?
S.W.A.T. stands for Special Weapons and Tactics, and a S.W.A.T. team is a special group of police trained to deal with unusually dangerous or violent situations, and having special weapons, such as rifles more powerful than those carried by regular police officers. They are employed, for example, in situations when hostages are being held, or heavily armed persons need to be captured.
The DOE spokesman said that the people who broke into Mr. Wright’s home were federal agents with the DOE’s Office of the Inspector General, not local S.W.A.T., a distinction that most likely means very little to Mr. Wright and his frightened children.
Another pertinent question goes to the judgment behind the decision to unleash a S.W.A.T. team on this innocent family. Even if Mrs. Wright is guilty of one of the crimes mentioned, was there no other way to gain entry and to search for evidence, like knocking on the door and asking to speak to Mrs. Wright, and showing the search warrant? And perhaps first, make sure Mrs. Wright still lived in the place and was likely at home?
This attack was grossly improper as it was, but could have been much, much worse. What if Mr. Wright had heard someone break down his door and tried to protect his children and his property with a weapon, as is his right? He or some of the police could have been injured or killed.
Realizing that S.W.A.T. teams are special units used in “unusually dangerous or violent situations,” and knowing that Mrs. Wright is not suspected of holding hostages or threatening to blow up a building, just who thought this situation warranted such an extreme measure?
This action by the Department of Education is intolerable. The person responsible for authorizing it should be immediately fired and prosecuted to the fullest extent possible.
The idea that the DOE thinks it needs and uses a S.W.A.T. team is a clear signal that something is terribly wrong in that agency, and perhaps in the federal government generally. Do the FDA, Interior, Commerce, the EPA and other federal bureaucracies also have armed S.W.A.T. teams ready to be unleashed against citizens? Do these other agencies also trample citizens’ rights to privacy and security in their homes?
Americans are increasingly becoming the servants and the government the master, which is exactly backward. The people in Washington need a strong message that things have gotten turned upside-down, and are going to have to change.
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Technorati Tags: Government, Politics, Bill of Rights, America
Sunday, June 19, 2011
Who’s dumber: Sarah Palin, or the liberals
who think she’s dumb?
Okay, that’s a rhetorical question. But it is really interesting to watch how people react to Sarah Palin. Mrs. Palin has done as good a job as anyone I can remember at twisting the mainstream media and other liberals into quivering puddles of hyper-frenzied protoplasm. They watch her every move, parse her every word, and ridicule and criticize her at every turn.For the record, I’m more or less neutral where Mrs. Palin is concerned; I’m not one of her legion of raving fans, and I’m not one of the legion of irrational haters. And I’ll give the media and the liberals more benefit of the doubt than they give to Mrs. Palin by saying that she does say things sometimes in a manner that invites negative attention.
The latest example of that was her comment about Paul Revere’s famous ride. One of the stops on her current bus tour was a visit to the Freedom Trail, and Paul Revere’s house, where after visiting the house she was asked about the famous messenger’s activities that April night in 1775. In response, she said: “He who warned, uh, the British that they weren’t going to be taking away our arms uh by ringing those bells and making sure as he’s riding his horse through town to send those warning shots and bells that we were going to be secure and we were going to be free and we were going to be armed.”
Okay, that wasn't the smoothest delivery and, hey, everybody knows that Paul Revere warned the colonists that the British were coming, and he didn't warn the British that the colonists were ready for them, right?
Well, no, according to several historians, and Paul Revere’s own account. The story we all learned in school is not exactly correct; at least, it’s not the whole story.
Dr. Robert Allison, Harvard Ph.D., and Chairman of the History Department at Suffolk University in Boston, told a National Public Radio interviewer, “But in fact, the British were going to Concord to seize the colonists’ arms.”
NPR Interviewer: “So you think basically, on the whole, Sarah Palin got her history right.”
Allison: “Well, yeah, she did. Remember, she is a politician. She’s not an historian.”
Still not convinced? Paul Revere himself said in a written account of what happened after he warned the colonists that he was confronted by six British Regulars, and one of them ordered him to dismount and asked him some questions. Asked his name, he replied “Revere,” and the British officer asked if he was “Paul” Revere, and if he was a courier. “I told him … that there would be five hundred Americans there in a short time, for I had alarmed the Country all the way up” Revere said.
Sounds like a warning to the British to me.
Folks who issue their criticisms judiciously might stop to double-check facts before they criticize, but, given the prejudices and arrogance of the liberals and their brothers-in-arms in the media, that’s not necessary where Sarah Palin is concerned. Her vast body of self-appointed and self-credentialed critics, denigrators, and ridiculers is convinced that the woman knows nothing, and certainly not as much as they know, so they felt comfortable automatically ridiculing her over this statement, no questions asked.
You won’t have as easy a time finding stories telling you that Mrs. Palin was essentially right and setting the record straight as you will have finding stories ridiculing her. There are at least two reasons for that: First, those shoot-from-the-lip critics don’t have the gumption to fess up to their unprofessional and idiotic behavior, and second, some of them don’t know enough to realize that they screwed up.
Even when confronted with evidence and authoritative support for her account, some folks refuse to accept that she was factually correct. That sort of thing is indicative of a mental disorder: when you are looking at the bark of a tree, but insist that you are looking at a fish, you have a serious problem.
When you know their attitude about the former governor, then observe their behavior, you can’t help asking “If she is so stupid, why do they expend so much emotion and energy attacking her?”
This compulsive behavior is another sign of mental trouble.
Once again Sarah Palin has shown herself to be much brighter than her detractors give her credit for, and much more savvy than they are.
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Technorati Tags: Sarah Palin, Politics, Liberalism, Media
Tuesday, June 14, 2011
Energy solutions and job creation
handcuffed by liberal ideology
The lack of a logical, well-thought-out US energy policy – or any kind of energy policy, for that matter – is now being felt through high gasoline prices and unemployment. This is not new with the Obama administration; the US hasn’t had a sound energy policy in recent memory. But the situation has reached unimagined levels of incoherence under Mr. Obama.At a time when the country was suffering, the Obama administration banned drilling for oil in the Gulf of Mexico after the tragic Macondo well explosion last year, idling thousands of workers in the oil industry and related businesses, and halting efforts to open new drilling projects that would provide new jobs and increase the oil supply. Production on every existing and potential project in the Gulf is at a standstill, except for one exploratory project, and some drilling rigs once operating there have been repositioned to other countries where there is a friendlier atmosphere for oil projects and jobs.
The left doesn’t like fossil fuels, and our president is a prisoner of leftist ideology. Coal and oil are the primary fuels in use today to produce electricity. Opponents don’t like coal because it produces pollution when it is burned, underground mining is dangerous to miners, and surface mining destroys the physical environment, they say. Oil is also a poor choice for energy, because it, too, pollutes the air when it is burned, and pollutes water and land if a drilling accident occurs.
Fossil fuels, however, offer significant advantages over newer, “greener” forms of energy. They produce 86 percent of our energy; there are proven reserves that will last dozens of years, at least; we have systems in place to utilize them to provide all of our energy; and they are relatively inexpensive, and would be less expensive still if the excessive regulations that raise the costs of acquisition and production are removed.
The costly and obstacle-ridden regulatory atmosphere has beaten the energy industry into submission as illustrated by American Electric Power’s announcement last week that it would retire or down-size 11 coal-fired power plants in seven states, costing 600 power plant jobs worth $40 million in wages rather than spend $6 billion to $8 billion in capital investment over the next decade to comply with EPA regulations. The industry has begun looking to natural gas to gradually replace coal and oil for electricity production. It is abundant and produces less pollution.
The Marcellus Shale Natural Gas Field Formation extends through West Virginia, Ohio, Pennsylvania and New York, and holds a huge amount of natural gas, perhaps more than 500 trillion cubic feet of gas. It is estimated that some horizontal drilling and hydraulic fracturing methods could recover as much as 10 percent of that, about 50 trillion cubic feet, enough to supply the entire United States for about two years, with a wellhead value of about one trillion dollars.
The American Petroleum Institute (API) notes that natural gas production in the Marcellus added 57,000 new jobs, mostly in Pennsylvania and West Virginia, as production increased in 2009. “This new analysis predicts that many tens of thousands of more jobs could be created in the coming years if public policies do not drastically limit production,” said Dr. Timothy J. Considine of Natural Resource Economics. "Under the best scenarios the development of Marcellus could mean $24 billion in total economic value to the region, which would positively impact all sectors of the economy.”
But the environmental faction is trying to accomplish through fear and distortion what it cannot accomplish by using reason and science. Opponents claim that deep drilling technologies such as hydraulic fracturing (fracking) pollute groundwater, a concern the API attributes largely to fear-mongering by environmental groups. “Hydraulic fracturing has been used in more than one million wells in the United States in the past 60+ years, and there is not one confirmed case of groundwater contamination,” API said, likely because the water table is usually 100 feet or less below the surface, while these gas reserves are more than 5,000 feet down.
The National Center for Policy Analysis (NCPA) calls fracking a technique with “startling” implications, saying that “natural gas may be only the beginning. Fracking also permits the extraction of previously-unrecoverable ‘tight oil,’ thereby postponing the day when the world runs out of petroleum.
“If gas hydrates, as well as shale gas, tight oil, oil sands and other unconventional sources can be tapped at reasonable cost, then the global energy picture looks radically different than it did only a few years ago. Suddenly it appears that there may be enough accessible hydrocarbons to power industrial civilization for centuries, if not millennia, to come,” NCAP wrote.
If we don’t shoot ourselves in the foot by doing to natural gas what we have done to coal and oil, our energy problems could be solved pretty soon.
However, leftist ideology is harming the country. It is impeding the recovery, killing jobs, and destroying our energy infrastructure in favor of an alternate one that isn’t yet able to replace the existing infrastructure.
So long as Washington is controlled by liberal ideologues, the future for both energy and jobs looks grim.
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Technorati Tags: Energy, Politics, Liberalism, Government
Tuesday, June 07, 2011
Responsible budget policy missing-in-action
in Washington, DC
Here are some important numbers to think about:
When you borrow money, you generally make monthly payments that cover the interest on the loan and some of the principal, but Joe only pays the interest. He borrows $1,200 each month and each year he adds $14,400 to his debt.
The lender put a limit on how much Joe can borrow based upon his financial circumstances. At some point he will have taken all the money available on his line of credit, and will have to make some hard choices, some lifestyle changes, start living within his means and start paying down his debt, unless he can convince the lender to raise his credit limit, which the lender likely wouldn’t do.
Here the comparison breaks down, because unlike Joe and the rest of us, the federal government can raise its own debt limit whenever it wants to borrow more money through an act of Congress, and has done so five times over the last several years. The spending-addicted Washington elite want to raise it again.
Where Joe is forced to begin living within his means and start paying down his debt, the federal government can theoretically just keep endlessly borrowing and avoiding fiscal responsibility.
Over the years the irresponsible, self-serving spenders have accumulated so much debt that every man, woman and child in America would have to pony up $45,000 to pay it off. Contrast that with the fact that the country produces only about $8,400 per person. Clear thinking people recognize that we have a debt crisis, but in the fantasy land that is Washington, DC, politicians think it is a signal to borrow more and spend more.
Our president, demonstrating the leadership qualities he developed in a few years of organizing communities and lecturing college students, leads the charge, proposing budget deficits exceeding $1 trillion in 2011, 2012 and beyond.
The dire circumstances the president and his cronies in DC are unable to comprehend, however, do not escape the understanding of a majority of Americans. An April Gallup poll reflects that two out of three Americans believe Social Security and Medicare costs are already creating a crisis for the federal government (34 percent) or will do so within 10 years (33 percent), while only 7 percent believe the cost of these programs will not create a crisis for the foreseeable future.
The spending-addicted ruling class believes we should just go merrily along spending, spending, spending, while they continue to selfishly put their political futures and big government ideology ahead of their duty to the country and its citizens.
Republican Rep. Paul Ryan, Chairman of the House Budget Committee, has done what should be done and what previous House leaders have refused to do: put forth a plan to address the fiscal crisis. However, Congressional Democrats who apparently want to continue spending 40 percent more than the country collects in taxes annually responded not with a good faith effort to find responsible ways to reduce spending, but by clouding the issue. Their answer is to scare elderly Americans, who are the target of a commercial showing a man pushing an elderly lady in a wheel chair toward a cliff and then dumping her over. This ad is the most idiotic, the most dishonest, and the most perverse piece of political fraud trotted out so far in the young 2012 political season. Congratulations, Democrats!
Rep. Ryan’s budget plan would not take away Granny’s Medicare coverage, as this cheap-shot, deceptive ad suggests, and the Democrats know it. His plan does not affect anyone 55 years of age or older.
We can have a discussion about whether Mr. Ryan’s proposal is a better way forward or not, and we should have that discussion, but it appears Congressional Democrats are unable to offer sensible arguments, and instead prefer to maintain the status quo and demagogue the issue. They falsely claim ObamaCare will take care of the problem, or most of it, and say, “Not to worry. We’ve got ten years to work on a solution.” That is simply not acceptable at this point.
It is time the folks in Congress earn their pay, make the hard but responsible decisions they were sent there to make, and return fiscal stability to our country.
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- Through the years the US has amassed a national debt of $14 trillion ($14,000,000,000,000).
- President George W. Bush increased the national debt by $4.2 trillion to $10.4 trillion over his eight years in office.
- President Barack Obama has increased the debt by $3.5 trillion to $13.954 trillion in his two-plus years in office.
- The debt now exceeds 90 percent of GDP; we owe nearly as much as we produce each year.
- The U.S. now borrows 40 cents of every dollar it spends.
- Social Security, Medicare, and Medicaid account for 43 percent of federal spending.
When you borrow money, you generally make monthly payments that cover the interest on the loan and some of the principal, but Joe only pays the interest. He borrows $1,200 each month and each year he adds $14,400 to his debt.
The lender put a limit on how much Joe can borrow based upon his financial circumstances. At some point he will have taken all the money available on his line of credit, and will have to make some hard choices, some lifestyle changes, start living within his means and start paying down his debt, unless he can convince the lender to raise his credit limit, which the lender likely wouldn’t do.
Here the comparison breaks down, because unlike Joe and the rest of us, the federal government can raise its own debt limit whenever it wants to borrow more money through an act of Congress, and has done so five times over the last several years. The spending-addicted Washington elite want to raise it again.
Where Joe is forced to begin living within his means and start paying down his debt, the federal government can theoretically just keep endlessly borrowing and avoiding fiscal responsibility.
Over the years the irresponsible, self-serving spenders have accumulated so much debt that every man, woman and child in America would have to pony up $45,000 to pay it off. Contrast that with the fact that the country produces only about $8,400 per person. Clear thinking people recognize that we have a debt crisis, but in the fantasy land that is Washington, DC, politicians think it is a signal to borrow more and spend more.
Our president, demonstrating the leadership qualities he developed in a few years of organizing communities and lecturing college students, leads the charge, proposing budget deficits exceeding $1 trillion in 2011, 2012 and beyond.
The dire circumstances the president and his cronies in DC are unable to comprehend, however, do not escape the understanding of a majority of Americans. An April Gallup poll reflects that two out of three Americans believe Social Security and Medicare costs are already creating a crisis for the federal government (34 percent) or will do so within 10 years (33 percent), while only 7 percent believe the cost of these programs will not create a crisis for the foreseeable future.
The spending-addicted ruling class believes we should just go merrily along spending, spending, spending, while they continue to selfishly put their political futures and big government ideology ahead of their duty to the country and its citizens.
Republican Rep. Paul Ryan, Chairman of the House Budget Committee, has done what should be done and what previous House leaders have refused to do: put forth a plan to address the fiscal crisis. However, Congressional Democrats who apparently want to continue spending 40 percent more than the country collects in taxes annually responded not with a good faith effort to find responsible ways to reduce spending, but by clouding the issue. Their answer is to scare elderly Americans, who are the target of a commercial showing a man pushing an elderly lady in a wheel chair toward a cliff and then dumping her over. This ad is the most idiotic, the most dishonest, and the most perverse piece of political fraud trotted out so far in the young 2012 political season. Congratulations, Democrats!
Rep. Ryan’s budget plan would not take away Granny’s Medicare coverage, as this cheap-shot, deceptive ad suggests, and the Democrats know it. His plan does not affect anyone 55 years of age or older.
We can have a discussion about whether Mr. Ryan’s proposal is a better way forward or not, and we should have that discussion, but it appears Congressional Democrats are unable to offer sensible arguments, and instead prefer to maintain the status quo and demagogue the issue. They falsely claim ObamaCare will take care of the problem, or most of it, and say, “Not to worry. We’ve got ten years to work on a solution.” That is simply not acceptable at this point.
It is time the folks in Congress earn their pay, make the hard but responsible decisions they were sent there to make, and return fiscal stability to our country.
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Technorati Tags: Economy, Politics, Government, Democrats
Tuesday, May 31, 2011
Business climate has many companies
singing “California, here I go”
California has been losing businesses at a ridiculous rate; 70 of them this year, as of mid-April, or nearly 5 each week. That number is up almost one company per week from last year. The Golden State has lost 1.2 million jobs in the last three years, and in April had an unemployment rate of 11.9 percent, second highest in the nation.
According to Chief Executive magazine, California sits atop the Worst States for Business list, for the second straight year. To rank the states the publication consulted more than 500 CEOs on “a wide range of criteria, from taxation and regulation to workforce quality and living environment.”
So why are businesses and jobs leaving the Golden State, and where are they going?
The painful reality is that businesses will pick up and move from a state that makes life difficult to a friendlier atmosphere, something California authorities, and those in some other states, apparently do not understand. But their counterparts in Texas do understand, and their state is one that attracts businesses that are unhappy elsewhere. Texas is rated as the best state in the nation for business, and when California lost 70 businesses, Texas gained 14 of them. While California lost more than a million jobs, Texas added 165,000 (61,000 of those came from California in 2009). While California has a 12 percent unemployment rate, Texas sports an 8 percent rate. Other states that benefited from the Golden State’s poor business environment are Kentucky, Florida, South Dakota, Utah and Georgia.
According to Chief Executive magazine, the ten worst states for business are: California, New York, Illinois, New Jersey, Michigan, Massachusetts, Connecticut, Hawaii, West Virginia, and Ohio. And the magazine’s ten best states are: Texas, North Carolina, Florida, Tennessee, Georgia, Indiana, Virginia, South Carolina, Utah, and Nevada.
Columnist John Fund of The Wall Street Journal wrote about California’s plight last month, discussing a trip to Texas by a group consisting mostly of Republican California lawmakers and Democrat Lt. Gov. Gavin Newsom to learn why firms abandoned California for the Lone Star State.
Mr. Fund recounted the negative experience of Andy Puzder, the CEO of Hardee's Restaurants. “He said it takes six months to two years to secure permits to build a new Carl's Jr. restaurant in the Golden State, versus the six weeks it takes in Texas,” Mr. Fund wrote. “California is also one of only three states that demands overtime pay after an eight-hour day, rather than after a 40-hour week. Such rules wreak havoc on flexible work schedules based on actual need. … ‘You can't build in California, you can't manage in California and you have to pay a big tax,’ Mr. Puzder told the legislators. ‘In Texas, it's the opposite—which is why we're building 300 new stores there this year.’"
More evidence demonstrating California’s anti-business atmosphere came from Mark Tolley, managing partner of real estate developer B. Knightly Homes. Mr. Tolley’s company left Long Beach back in 2005 for Austin. "The red tape is ridiculous," he said. "Regulators see developers as wearing a black hat and the environmental laws have run amok."
“I’m a pro-jobs Democrat,” Lt. Gov. Newsom told Mr. Fund. “My party needs to get back into the business of jobs.” We can give state Democrats credit for finally waking up to reality and taking steps to repair California’s business environment, but it really isn’t a secret what attracts businesses. The problem is that the things it takes to attract businesses run counter to the ideology and political methodology of many politicians, who show favoritism for workers over the people who employ them. In fact, several Democrat legislators who had planned to go on the trip yielded to pressure from public-employee unions, and didn’t go along to find out how to create jobs and attract businesses.
Despite the fact that businesses make and sell things people want and need, pay people wages to make and sell those things, pay taxes and fees that keep governments running, and generally do good things in their communities, politicians and governments often treat them as an enemy, making them the subjects of scorn and derision, and the targets of heavy regulation, punishing taxation, and adverse legal systems. Business is the engine that powers our economy and we need lots of them making enough of a profit to keep their doors open and keep people working.
Most of us believe that it is better to work and earn a living than to depend upon others to support us. However, today 15 of every 100 people wanting to work cannot find a job that meets their needs, or any job at all. Government policies like those of the Worst States for Business, and those so loved by Congress and administrative departments and agencies in Washington, DC, are designed not to foster business and job creation, but to serve special interests. Since January 2008, the US lost 8.7 million jobs, and so far only 1.8 million have been regained.
If the world we want is a world with 15 percent unemployment and underemployment, we should just keep on making it difficult for businesses to start up and operate.
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Technorati Tags: Business, Politics, Liberalism, Government
According to Chief Executive magazine, California sits atop the Worst States for Business list, for the second straight year. To rank the states the publication consulted more than 500 CEOs on “a wide range of criteria, from taxation and regulation to workforce quality and living environment.”
So why are businesses and jobs leaving the Golden State, and where are they going?
The painful reality is that businesses will pick up and move from a state that makes life difficult to a friendlier atmosphere, something California authorities, and those in some other states, apparently do not understand. But their counterparts in Texas do understand, and their state is one that attracts businesses that are unhappy elsewhere. Texas is rated as the best state in the nation for business, and when California lost 70 businesses, Texas gained 14 of them. While California lost more than a million jobs, Texas added 165,000 (61,000 of those came from California in 2009). While California has a 12 percent unemployment rate, Texas sports an 8 percent rate. Other states that benefited from the Golden State’s poor business environment are Kentucky, Florida, South Dakota, Utah and Georgia.
According to Chief Executive magazine, the ten worst states for business are: California, New York, Illinois, New Jersey, Michigan, Massachusetts, Connecticut, Hawaii, West Virginia, and Ohio. And the magazine’s ten best states are: Texas, North Carolina, Florida, Tennessee, Georgia, Indiana, Virginia, South Carolina, Utah, and Nevada.
Columnist John Fund of The Wall Street Journal wrote about California’s plight last month, discussing a trip to Texas by a group consisting mostly of Republican California lawmakers and Democrat Lt. Gov. Gavin Newsom to learn why firms abandoned California for the Lone Star State.
Mr. Fund recounted the negative experience of Andy Puzder, the CEO of Hardee's Restaurants. “He said it takes six months to two years to secure permits to build a new Carl's Jr. restaurant in the Golden State, versus the six weeks it takes in Texas,” Mr. Fund wrote. “California is also one of only three states that demands overtime pay after an eight-hour day, rather than after a 40-hour week. Such rules wreak havoc on flexible work schedules based on actual need. … ‘You can't build in California, you can't manage in California and you have to pay a big tax,’ Mr. Puzder told the legislators. ‘In Texas, it's the opposite—which is why we're building 300 new stores there this year.’"
More evidence demonstrating California’s anti-business atmosphere came from Mark Tolley, managing partner of real estate developer B. Knightly Homes. Mr. Tolley’s company left Long Beach back in 2005 for Austin. "The red tape is ridiculous," he said. "Regulators see developers as wearing a black hat and the environmental laws have run amok."
“I’m a pro-jobs Democrat,” Lt. Gov. Newsom told Mr. Fund. “My party needs to get back into the business of jobs.” We can give state Democrats credit for finally waking up to reality and taking steps to repair California’s business environment, but it really isn’t a secret what attracts businesses. The problem is that the things it takes to attract businesses run counter to the ideology and political methodology of many politicians, who show favoritism for workers over the people who employ them. In fact, several Democrat legislators who had planned to go on the trip yielded to pressure from public-employee unions, and didn’t go along to find out how to create jobs and attract businesses.
Despite the fact that businesses make and sell things people want and need, pay people wages to make and sell those things, pay taxes and fees that keep governments running, and generally do good things in their communities, politicians and governments often treat them as an enemy, making them the subjects of scorn and derision, and the targets of heavy regulation, punishing taxation, and adverse legal systems. Business is the engine that powers our economy and we need lots of them making enough of a profit to keep their doors open and keep people working.
Most of us believe that it is better to work and earn a living than to depend upon others to support us. However, today 15 of every 100 people wanting to work cannot find a job that meets their needs, or any job at all. Government policies like those of the Worst States for Business, and those so loved by Congress and administrative departments and agencies in Washington, DC, are designed not to foster business and job creation, but to serve special interests. Since January 2008, the US lost 8.7 million jobs, and so far only 1.8 million have been regained.
If the world we want is a world with 15 percent unemployment and underemployment, we should just keep on making it difficult for businesses to start up and operate.
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Technorati Tags: Business, Politics, Liberalism, Government
Tuesday, May 24, 2011
Dismantling the Constitution:
the 4th Amendment is under attack
As the delegates to the Constitutional Convention wrangled over the precise form of the document for governing their new nation some delegates refused to sign a draft because it did not include a bill of rights, a feature typical of the constitutions of the several states. Those delegates wanted there to be no question that certain rights were to be honored by the federal government, and this issue was so important to the Anti-Federalists that they used the absence of a bill of rights as reason enough to not ratify the Constitution. Eventually, it was agreed to include a Bill of Rights comprised of 10 amendments in the Constitution of the United States of America. Of the 10 rights considered important enough to be specifically guaranteed, the 4th Amendment states: “The right of the people to be secure in their persons, houses, papers, and effects, against unreasonable searches and seizures, shall not be violated, and no Warrants shall issue, but upon probable cause, supported by Oath or affirmation, and particularly describing the place to be searched, and the persons or things to be seized.”
Go back and read that statement carefully.
The 4th Amendment is about as plain a statement of the sanctity of one’s home, person and personal property as can be made, and it states as clearly as it can be stated that strict procedures must be followed in order to suspend the right of citizens to be free of government intrusion, even when there is legitimate suspicion that a crime may have been committed.
So, how do we explain educated people, trained in the law, and presumably fluent in the King’s English, failing to understand this simple, straightforward, and unambiguous statement – a forthright guarantee of the personal right to privacy – except when strict standards are met to justify suspending that right?
One body that should be held to account is the Indiana Supreme Court, whose majority in one case stated that “[we] hold that there is no right to reasonably resist unlawful entry by police officers.”
Another body to be held to account is the Supreme Court of the United States, whose failure to obey the clear language of our Constitution was reported by the Los Angeles Times: “The Supreme Court … gave police more leeway to break into residences in search of illegal drugs. The justices in an 8-1 decision said officers who loudly knock on a door and then hear sounds suggesting evidence is being destroyed may break down the door and enter without a search warrant.” The ruling came in an appeal of a Kentucky case in which the state Supreme Court overturned a lower court’s conviction of a man whose apartment police broke into in the manner described.
Justice Samuel Alito wrote that people who "attempt to destroy evidence have only themselves to blame," when police break down their door. But the lone dissenter, Justice Ruth Bader Ginsburg, wrote that “police officers may not knock, listen and then break the door down.” That violates the 4th Amendment, she correctly noted.
The judicially conservative Justice Alito and the judicially liberal Justice Ginsburg have switched places on this issue.
Justice Alito’s comment begs the question, “just what does evidence being destroyed sound like through a closed door?” After knocking on the door the police hear a toilet flush. “Uh-oh,” one of them says, “someone is destroying evidence,” and they break the door down. Leaving aside the issue of how likely it is that someone at the front door could hear a toilet flush inside a residence, what if someone inside was merely using the bathroom?
Under this ultra-liberal standard police conceivably could go to any residence for any reason, or for no reason in particular, knock on the door, then break it down because they “thought” evidence was being destroyed. That is precisely what the 4th Amendment is intended to prevent.
Remember, just because the police knock on your door, you are not obligated to open it, or let them in. It’s your residence; you decide who to let in, as Justice Alito himself stated before he forgot that we have a 4th Amendment: "When law enforcement officers who are not armed with a warrant knock on a door, they [may] do no more than any private citizen may do." Thus, if a private citizen breaks down the door, the resident would be justified in using necessary force in defending himself from an intruder who has no authority to enter the premises.
If there is probable cause to believe there are illegal drugs in a residence, police must take the time and follow procedures to get a warrant. Catching every drug dealer at every single opportunity is not more important than the right of the people to be free from government tyranny and over-zealous police.
Justice Ginsburg, apparently the only justice in command of good sense, said the court's approach "arms the police with a way routinely to dishonor the 4th Amendment's warrant requirement in drug cases.”
The 4th Amendment is what separates the United States from tyrannical police states. Someone should remind our judges of that crucial fact.
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Technorati Tags: US Constitution, Government, Liberalism, America
Tuesday, May 17, 2011
Here are three important questions
Americans should think about
1. Why have so many Americans traded liberty for government control?
The federal tax code is 17,000 pages and involves more than 700 different forms. According to the IRS, Americans spend something like 5.1 billion hours each year preparing their taxes, and tax preparation drains an estimated $194 billion annually from the U.S. economy, according to the Tax Foundation.
The Code of Federal Regulations, the codification of the general and permanent rules created by Congress and the executive departments and agencies of the federal government, comprises a mind-blowing 163,000 pages, weighs more than 1,600 pounds, and stands 54 feet high.
Should government decide the kind of light bulbs we can use, or the kind of toilets we can own, or the kind of sheets hotels put on their beds, or be able to tell us we have to buy a particular item? Now that the feds have taken over General Motors, is it okay that they require us to buy a Chevy instead of a Ford or a Dodge or a VW or a Subaru? (Chevy dealers may not participate in this poll.)
The answers to those questions are: “No, no, no, no, and absolutely not.”
2. Why have so many Americans traded self-sufficiency for dependency?
In 2009 there were 37.2 million food stamp recipients, 4.1 million on welfare and 9.1 million receiving unemployment support. In 2010 Medicaid had 58 million participants. Allowing for duplications of aid for some Americans, it is likely that more than one-fourth of the people living in the U.S. receive one or more forms of financial assistance from the federal government, not including Medicare.
And, 51 percent of the households in the country paid no income taxes to support their federal government in 2010. The Atlantic magazine reports in its online edition that “about fifteen million American households, or 10 percent of all taxpayers, receive more cash from the IRS than they contribute in federal income taxes and payroll taxes. That's thanks to ‘refundable credits,’ tax credits that can bring your tax bill into negative territory.”
Since President Lyndon B. Johnson launched the War on Poverty in 1964, welfare spending increased 13 times by FY 2008, rising from $50 billion to over $700 billion in inflation-adjusted dollars.
Despite having spent trillions of dollars on the War on Poverty, record numbers of Americans get federal assistance today. Obviously, some of these folks genuinely need help, but some of them are taking advantage of the situation, and are taking advantage of their tax-paying fellow Americans. We’ve made it attractive for people to become dependent.
3. Why have so many Americans forsaken our traditional values, like marriage and family?
In 2007 nearly 40 percent of babies born in the United States were born to unwed females, according to the National Center for Health Statistics. The 1.7 million out-of-wedlock births represent an increase of more than 25 percent over five years. The Guttmacher Institute estimates that nearly half of pregnancies among American women are unintended, and 40 percent of them end with abortion.
Heritage Foundation senior researcher Robert Rector wrote last year, “The principal cause of child poverty in the U.S. is the absence of married fathers in the home,” yet marriage continues to decline.
Columnist Cal Thomas wrote recently about Robert Woodson, president of the Center for Neighborhood Enterprise, an organization helping people rise out of poverty. He suggests that Mr. Woodson “would probably wince if you called him a ‘community organizer.’ That's because for the last 30 years … he has not spent time organizing the poor around ineffective government programs and other addictions, he has been helping them become self-sufficient.”
Mr. Woodson subscribes to the idea that life is 10 percent what happens to us and 90 percent how we respond to it, and says unlike other approaches, "takes time-tested principles and virtues and applies them to addictions, homelessness and other conditions. We have moral consistency," he believes. He also believes that "you can't learn anything by studying failure. If you want to learn anything, you must study the successful."
Cal Thomas recounts a day “visiting housing projects Woodson's organization supports and studying his success. I met former drug addicts, dealers, prostitutes and pimps – all of whom testify to having been through failed government programs – who now say they are clean, sober and off the streets.” The keys, Mr. Thomas concludes, are discipline, and raised expectations within a family atmosphere infused with tough love, imposed morality, and yes, hope.
Robert Woodson shows that what many, perhaps most, of the poor need in order to improve their lot in life is some good, old fashioned, traditional American values, personal liberty, and self-reliance. What they don’t need, and what has failed to help them, is more expensive government programs funded by high taxation and operated by a huge inefficient bureaucracy.
Tens of thousands of pages of government regulations, people depending upon government instead of themselves, and an eroding moral base reflect a society that has forsaken the standards that built it into the bright light of the world. Our infidelity to the founding principles is reducing the United States to another failing socialistic welfare state.
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The federal tax code is 17,000 pages and involves more than 700 different forms. According to the IRS, Americans spend something like 5.1 billion hours each year preparing their taxes, and tax preparation drains an estimated $194 billion annually from the U.S. economy, according to the Tax Foundation.
The Code of Federal Regulations, the codification of the general and permanent rules created by Congress and the executive departments and agencies of the federal government, comprises a mind-blowing 163,000 pages, weighs more than 1,600 pounds, and stands 54 feet high.
Should government decide the kind of light bulbs we can use, or the kind of toilets we can own, or the kind of sheets hotels put on their beds, or be able to tell us we have to buy a particular item? Now that the feds have taken over General Motors, is it okay that they require us to buy a Chevy instead of a Ford or a Dodge or a VW or a Subaru? (Chevy dealers may not participate in this poll.)
The answers to those questions are: “No, no, no, no, and absolutely not.”
2. Why have so many Americans traded self-sufficiency for dependency?
In 2009 there were 37.2 million food stamp recipients, 4.1 million on welfare and 9.1 million receiving unemployment support. In 2010 Medicaid had 58 million participants. Allowing for duplications of aid for some Americans, it is likely that more than one-fourth of the people living in the U.S. receive one or more forms of financial assistance from the federal government, not including Medicare.
And, 51 percent of the households in the country paid no income taxes to support their federal government in 2010. The Atlantic magazine reports in its online edition that “about fifteen million American households, or 10 percent of all taxpayers, receive more cash from the IRS than they contribute in federal income taxes and payroll taxes. That's thanks to ‘refundable credits,’ tax credits that can bring your tax bill into negative territory.”
Since President Lyndon B. Johnson launched the War on Poverty in 1964, welfare spending increased 13 times by FY 2008, rising from $50 billion to over $700 billion in inflation-adjusted dollars.
Despite having spent trillions of dollars on the War on Poverty, record numbers of Americans get federal assistance today. Obviously, some of these folks genuinely need help, but some of them are taking advantage of the situation, and are taking advantage of their tax-paying fellow Americans. We’ve made it attractive for people to become dependent.
3. Why have so many Americans forsaken our traditional values, like marriage and family?
In 2007 nearly 40 percent of babies born in the United States were born to unwed females, according to the National Center for Health Statistics. The 1.7 million out-of-wedlock births represent an increase of more than 25 percent over five years. The Guttmacher Institute estimates that nearly half of pregnancies among American women are unintended, and 40 percent of them end with abortion.
Heritage Foundation senior researcher Robert Rector wrote last year, “The principal cause of child poverty in the U.S. is the absence of married fathers in the home,” yet marriage continues to decline.
Columnist Cal Thomas wrote recently about Robert Woodson, president of the Center for Neighborhood Enterprise, an organization helping people rise out of poverty. He suggests that Mr. Woodson “would probably wince if you called him a ‘community organizer.’ That's because for the last 30 years … he has not spent time organizing the poor around ineffective government programs and other addictions, he has been helping them become self-sufficient.”
Mr. Woodson subscribes to the idea that life is 10 percent what happens to us and 90 percent how we respond to it, and says unlike other approaches, "takes time-tested principles and virtues and applies them to addictions, homelessness and other conditions. We have moral consistency," he believes. He also believes that "you can't learn anything by studying failure. If you want to learn anything, you must study the successful."
Cal Thomas recounts a day “visiting housing projects Woodson's organization supports and studying his success. I met former drug addicts, dealers, prostitutes and pimps – all of whom testify to having been through failed government programs – who now say they are clean, sober and off the streets.” The keys, Mr. Thomas concludes, are discipline, and raised expectations within a family atmosphere infused with tough love, imposed morality, and yes, hope.
Robert Woodson shows that what many, perhaps most, of the poor need in order to improve their lot in life is some good, old fashioned, traditional American values, personal liberty, and self-reliance. What they don’t need, and what has failed to help them, is more expensive government programs funded by high taxation and operated by a huge inefficient bureaucracy.
Tens of thousands of pages of government regulations, people depending upon government instead of themselves, and an eroding moral base reflect a society that has forsaken the standards that built it into the bright light of the world. Our infidelity to the founding principles is reducing the United States to another failing socialistic welfare state.
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Technorati Tags: Culture, Politics, Liberalism, Government
Tuesday, May 10, 2011
Barack Obama’s ideology produces pain
for the American people
As President, Barack Obama has shown the occasional capacity to recognize good policies when he sees them. As a candidate for president, Mr. Obama continuously condemned George W. Bush for the Guantanamo Bay enemy combatant facility, for enhanced interrogation techniques, rendition, black site interrogation facilities, virtually everything else the nation was doing in the “War on Terror,” and also for the wars in Iraq and Afghanistan. That technique played well with voters and helped him win the election.
But as president he learned that things look different from inside the Oval Office than from outside on the campaign trail, and he used and benefitted from those same anti-terrorism policies he so bitterly criticized in finding and disposing of Osama bin Laden.
If he can recognize and utilize successful policies in the areas of war and terrorism, he ought to be able to also do so in other important areas, such as economic policy and energy policy, particularly when the two are so critically important and so inextricably linked. And surely he understands that an unemployment rate above 7.0 percent, two full points below where it stands today, will sink his re-election in 2012.
Yes, the election is 19 months away, an eternity in politics, and a lot can happen. But none of the president’s leftist/socialist efforts to turn the economy around has accomplished much, and he shows no signs of getting government out of the way so that the economy can fix itself, as it has always done when government stays out of the way.
The White House keeps publicizing the number of jobs created each month, but notice that the unemployment rate has been above 8.0 percent since Mr. Obama took office, as high as 10.1, and it rose again to 9.0 in April. The more important number is the U-6, which includes those who are unemployed, underemployed, and who have given up looking for work. That number is 16.6 percent.
Creating jobs is obviously important, but maintaining existing jobs is just as important, and the Obama policies have failed spectacularly in that regard. We’re told of the thousands of new jobs created each month, but the unemployment rate is still 80 percent above normal levels. Unemployment rates were below 6.0 percent every year but one from 1995 through 2008.
Tim Cavanaugh notes on Reason.com that “less than a year after the trough of the 1958 recession, the economy had reversed an unemployment spike of more than four percentage points,” and “in 1981-1982, job growth more than erased a 3.1 percentage point increase in unemployment within 11 months, leaving the rate lower than it was before the recession.” The Obama solutions are not working.
Furthermore, the Obama administration’s moratorium on offshore drilling is not only keeping thousands of American oil industry workers on the unemployment rolls; it also deprives governments of needed revenue, and that problem will grow unless new drilling leases in the Gulf of Mexico are sold this year and drilling resumes.
After the Deepwater Horizon explosion in the Gulf last spring, the Obama administration issued a moratorium on all drilling, suspending 33 separate projects in various stages of development, halting new lease sales and suspending permitting on existing leases, producing a decline of an estimated 240,000 barrels a day in oil production in the Gulf this year, according to the U.S. Energy Information Administration. The Heritage Foundation’s Rob Bluey estimates that this loss of royalties, lease bids, and taxes “represents billions of dollars in potential revenue that could help close the federal deficit.”
Mr. Obama lifted the moratorium last October, but since then virtually nothing has changed; oil companies are faced with a deliberate slowing of the permitting process. This year could be the first since 1965 that the federal government did not sell leases in the Gulf.
Policy over-reactions like the drilling ban impede the recovery and keep unemployment high. This one also reduces the world-wide supply of oil.
Less American oil in the system lowers the world supply and pushes oil prices higher; the higher the price of oil, the higher the price of gasoline; the more expensive gasoline becomes, the more pain the American people feel and the less objectionable those inefficient and expensive electric cars and hybrids that Mr. Obama loves so become.
“Never let a crisis go to waste,” the theory goes, and the administration is still trying to shove immature, undeveloped, inefficient and expensive green energy down our throats. Now the administration is promoting a transportation authorization bill that would require the study and implementation of a plan to tax automobile drivers on how many miles they drive. More pain from the Obama administration in its attempt to force green energy on the American people.
We would not put an adolescent into any position of responsibility, but that is precisely what Mr. Obama is attempting to do with regard to his green energy vision.
If the president can understand how sensible and effective the anti-terror policies of George W. Bush are, he ought to be able to understand that “green” technologies will be naturally and enthusiastically accepted when they are practical and make economic sense.
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Technorati Tags: Economy, Politics, Liberalism, Government
Tuesday, May 03, 2011
The left is at it again,
demonizing business for fun and profit
With the current brouhaha over the national debt and projected trillion dollar budget deficits, one side wants to cut spending to solve the problem, the other wants to raise taxes on the wealthy and on businesses. The tax raisers talk about cutting spending, and make a token effort to cut a little bit, but mostly they’re just talking. They don’t do spending cuts; they only want to raise taxes.Like many liberal solutions this one sounds good in the abstract. After all, when you want money, where better to get it than from those that have it? The notorious bank robber Willie Sutton apparently understood this. When asked why he robbed banks he is rumored to have answered, “Because that’s where the money is!” But he found there was a downside to going where the money was, spending about half of his adult life in prison.
And like many liberal solutions to problems there is also a downside to going after wealthy Americans and businesses to satisfy the government’s obsessive spending, and we hear a lot less about the downsides to these solutions than we hear about the wonders they supposedly will produce.
All jobs in the US are the result of activity in the private sector. Even government workers owe their jobs to American businesses, because without them there would be no one to tax to get the money to pay government employees.
Every dollar taken from the private sector by government through taxation is a dollar that can’t be used to buy stuff. The more money people have the more goods and services they will buy. The more goods and services people want to buy, the more of them that have to be produced, and that is where jobs come from. Over-taxing the wealthy and businesses is in effect biting the hand that feeds you.
The left is fond of finding someone or something it can portray as evil and greedy, and get people all riled up about it. One of the most popular of those is the oil industry.
Conventional wisdom holds that the oil industry is one of the most profitable industries in the country, raking in billions of dollars each year, and it’s the greedy oil companies that control gasoline prices that are punishing Americans today. And since our leaders have spent us into a deep hole and want to spend even more, oil companies are a juicy target for additional tax revenue, and no one will complain if taxes are raised on oil companies.
But the oil industry is in the bottom half of industries on the profit list, as reported by the American Petroleum Institute (API) with nine industry groups that make higher profit margins than “Big Oil,” while seven have lower profit margins. The upper group includes chemicals, pharmaceuticals and medicines, computer and peripheral equipment, apparel and leather products, machinery, electrical equipment and related items, aerospace products and parts, and a category called “all manufacturing.”
The highest earning industry group, beverage and tobacco products, makes more than three times the profit margin (21.7 percent) of oil companies (5.7 percent). For every dollar of an oil company’s sales, after all expenses are paid the oil company has 5.7 cents left as profit. By no reasonable measure can that be called excessive profit.
The oil industry makes tens of billions in profits because it spends hundreds of billions doing business. The oil industry spent well in excess of $250 billion just on capital projects in the U.S. in 2010, and more than $58 billion on new low-and-zero emissions technologies for carbon mitigation, which is 44 percent of all expenditures for that purpose.
And on the subject of taxes, API reports that U.S. oil and natural gas companies pay considerably more in taxes than the average manufacturing company. In 2010 income tax expenses (as a share of net income before income taxes) averaged 41.1 percent, compared to 26.5 percent for other S&P Industrial companies.”
Market forces and government policies are responsible for raising gasoline prices, and higher gasoline prices only increase industry profits.
People believe taxing oil profits punishes greedy oil companies. They’re wrong. API explains: “If you’re wondering who owns ‘Big Oil,’ chances are good the answer is ‘you do.’ If you have a mutual fund account, and 55 million U.S. households do, there’s a good chance it invests in oil and natural gas stocks. If you have an IRA or personal retirement account, and 45 million U.S. households do, there’s a good chance it invests in energy stocks.” And, API says, only 1.5 percent of oil industry stock is owned by corporate management. “The rest is owned by tens of millions of Americans, many of them middle class, such as teachers, police and firefighters.”
While President Barack Obama and other liberal big spenders like to get folks all fired up about greedy “Big Oil” as a source for tax revenue, what he’s not telling you is that raising taxes on oil companies is raising taxes on you.
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Technorati Tags: Economy, Politics, Taxes, Government
Sunday, May 01, 2011
Westboro church creeps meet their match
No decent person defends the disgraceful behavior of members of the Westboro Baptist Church, and may of us are angered by their pultroonishness.The following story recounts their defeat.
Brandon, Mississippi will go down in history as the town where the Westboro Baptist Church met its match.
The lunatics showed up to protest at the funeral of local hero Staff Sgt Jason Rogers who was killed in Afghanistan, but left town without making a peep. They may have made a few moans and groans, but no peeps.
Westboro Baptist is really more of an asylum than a church
The Hayride has the righteous report:
A couple of days before, one of them (Westboro protestors) ran his mouth at a Brandon gas station and got his arse waxed. Police were called and the beaten man could not give much of a description of who beat him. When they canvassed the station and spoke to the large crowd that had gathered around, no one seemed to remember anything about what had happened.
Rankin County handled this thing perfectly. There were many things that were put into place that most will never know about and at great expense to the county.
Most of the morons never made it out of their hotel parking lot. It seems that certain Rankin county pickup trucks were parked directly behind any car that had Kansas plates in the hotel parking lot and the drivers mysteriously disappeared until after the funeral was over. Police were called but their wrecker service was running behind and it was going to be a few hours before they could tow the trucks so the Kansas plated cars could get out.
A few made it to the funeral but were ushered away to be questioned about a crime they might have possibly been involved in. Turns out, after a few hours of questioning, that they were not involved and they were allowed to go on about their business.
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Tuesday, April 26, 2011
Government’s fiscal malfeasance should be
grounds for impeachment
Did you know that the United States paid $413 billion in interest on the national debt in 2010, and that was more than we spent running a dozen federal departments and agencies (Health and Human Services, Transportation, Energy, Veterans Affairs, Housing and Urban Development, Justice, Homeland Security, Agriculture, Commerce, Treasury, Labor, and the Small Business Administration) combined?
The US spending addiction is so bad that since 1988 we have spent $8 trillion on interest payments alone. According to governmentgonewild.com, that’s enough to buy every taxpayer – more than 140 million of us – a really expensive Lotus sports car. The debt is so enormous, the Web site asserts, that if we started today paying $100 million a day against the debt, it would take 389 years to pay it down.
The Congressional Budget Office estimates that at the rate we are going, by 2021 we will spend $1.1 trillion on interest annually, and by 2046, the CBO says all tax revenue collected will be required just to pay the interest on the national debt.
Even at that point you may rest assured that big government types will want to borrow even more money, and will whine and stomp their feet over suggestions that they cut spending to match tax collections. We’ll be treated to the same pathetic efforts they use today to demonize those who advocate fiscal responsibility, such as charging that fiscal conservatives are mean and cruel, and spouting absurdities such as cutting spending will deny children health care, put poor people out on the street and kill old people, or at least make them eat dog food. That’s what passes for honest debate these days, and it is intended to scare the public away from responsible fiscal policies. Then the demagogues can keep giving handouts to their supportive constituencies, and if that bankrupts the country, well, that’s the price we have to pay.
But, as they say in certain parts of the US where common sense is not an alien concept, “That dog won’t hunt.” Last week the Associated Press reported that Standard & Poor's Ratings Service “downgraded its outlook on U.S. government debt, expressing unprecedented doubts (emphasis added) over the ability of Washington to bring the massive federal budget deficits under control,” lowering the long-term outlook to “Negative” from “Stable,” “saying there is a one in three chance the United States could lose its top investment rating on its debt in the next two years.”
Will that message get through to spending-addicted Washington?
Then we have the debt ceiling, a device designed to prevent the very thing that has occurred: runaway debt. Currently, the debt ceiling is $14.3 trillion, a limit the US will tear through this summer unless the ceiling is raised yet again, or, better yet, unless more sensible action is taken to reduce spending and pay down the debt. Failing to raise the debt ceiling is now being portrayed by our spending-addicted politicos as a calamity greater even than a Barack Obama presidency. But it’s just more fear-mongering; another ploy to scare the masses.
However, Andrew Moylan of the National Taxpayers Union told The Daily Caller that “failing to raise the debt ceiling would merely trigger a 10-12 week period where ‘extraordinary measures’ could be taken by the Treasury Department to ‘shift things around.’” Maybe that includes furloughing “non-essential” government employees. Why does government have “non-essential” employees?
While failing to raise the debt ceiling isn’t the looming catastrophe that we are being told it is, raising it likely will have the same effect that it has had the five times it has been raised since 2002: it will do nothing more than allow the government to postpone behaving responsibly.
There are legitimate reasons to increase a credit limit, but they are rare, and increasing the limit on borrowed money five times in nine years reflects something altogether different than emergency circumstances: it indicates a strong and irresponsible compulsion to spend, spend, spend, rather than live within our means.
The good news is that we common folk out here in fly-over country realize what Washington’s ruling elite either doesn’t realize, or ignores. A recent poll by CBS News and The New York Times shows that by a margin of 63 percent to 27 percent, participants oppose raising the debt limit, including 83 percent of Republicans, 64 percent of independents, and nearly half of the Democrats (48 percent). And 70 percent of those opposed hold to that position even if it means that interest rates will go up.
Yet President Barack Obama hasn’t gotten the message. As reported by MSNBC: he “sent Congress a $3.73 trillion budget Monday that holds out the prospect of eventually bringing deficits under control through spending cuts and tax increases. But the fiscal blueprint largely ignores his own deficit commission's view that the nation is imperiled unless huge entitlement programs like Social Security and Medicare are slashed,” and includes yet another huge $1.1 trillion budget deficit.
Taxpayers are being disserved by most of their elected federal officials, who refuse to do their job. If you or a co-worker behaved this way, you or they would be fired.
This process should commence immediately.
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Technorati Tags: National Debt, Economy, Liberalism, Government
The US spending addiction is so bad that since 1988 we have spent $8 trillion on interest payments alone. According to governmentgonewild.com, that’s enough to buy every taxpayer – more than 140 million of us – a really expensive Lotus sports car. The debt is so enormous, the Web site asserts, that if we started today paying $100 million a day against the debt, it would take 389 years to pay it down.
The Congressional Budget Office estimates that at the rate we are going, by 2021 we will spend $1.1 trillion on interest annually, and by 2046, the CBO says all tax revenue collected will be required just to pay the interest on the national debt.
Even at that point you may rest assured that big government types will want to borrow even more money, and will whine and stomp their feet over suggestions that they cut spending to match tax collections. We’ll be treated to the same pathetic efforts they use today to demonize those who advocate fiscal responsibility, such as charging that fiscal conservatives are mean and cruel, and spouting absurdities such as cutting spending will deny children health care, put poor people out on the street and kill old people, or at least make them eat dog food. That’s what passes for honest debate these days, and it is intended to scare the public away from responsible fiscal policies. Then the demagogues can keep giving handouts to their supportive constituencies, and if that bankrupts the country, well, that’s the price we have to pay.
But, as they say in certain parts of the US where common sense is not an alien concept, “That dog won’t hunt.” Last week the Associated Press reported that Standard & Poor's Ratings Service “downgraded its outlook on U.S. government debt, expressing unprecedented doubts (emphasis added) over the ability of Washington to bring the massive federal budget deficits under control,” lowering the long-term outlook to “Negative” from “Stable,” “saying there is a one in three chance the United States could lose its top investment rating on its debt in the next two years.”
Will that message get through to spending-addicted Washington?
Then we have the debt ceiling, a device designed to prevent the very thing that has occurred: runaway debt. Currently, the debt ceiling is $14.3 trillion, a limit the US will tear through this summer unless the ceiling is raised yet again, or, better yet, unless more sensible action is taken to reduce spending and pay down the debt. Failing to raise the debt ceiling is now being portrayed by our spending-addicted politicos as a calamity greater even than a Barack Obama presidency. But it’s just more fear-mongering; another ploy to scare the masses.
However, Andrew Moylan of the National Taxpayers Union told The Daily Caller that “failing to raise the debt ceiling would merely trigger a 10-12 week period where ‘extraordinary measures’ could be taken by the Treasury Department to ‘shift things around.’” Maybe that includes furloughing “non-essential” government employees. Why does government have “non-essential” employees?
While failing to raise the debt ceiling isn’t the looming catastrophe that we are being told it is, raising it likely will have the same effect that it has had the five times it has been raised since 2002: it will do nothing more than allow the government to postpone behaving responsibly.
There are legitimate reasons to increase a credit limit, but they are rare, and increasing the limit on borrowed money five times in nine years reflects something altogether different than emergency circumstances: it indicates a strong and irresponsible compulsion to spend, spend, spend, rather than live within our means.
The good news is that we common folk out here in fly-over country realize what Washington’s ruling elite either doesn’t realize, or ignores. A recent poll by CBS News and The New York Times shows that by a margin of 63 percent to 27 percent, participants oppose raising the debt limit, including 83 percent of Republicans, 64 percent of independents, and nearly half of the Democrats (48 percent). And 70 percent of those opposed hold to that position even if it means that interest rates will go up.
Yet President Barack Obama hasn’t gotten the message. As reported by MSNBC: he “sent Congress a $3.73 trillion budget Monday that holds out the prospect of eventually bringing deficits under control through spending cuts and tax increases. But the fiscal blueprint largely ignores his own deficit commission's view that the nation is imperiled unless huge entitlement programs like Social Security and Medicare are slashed,” and includes yet another huge $1.1 trillion budget deficit.
Taxpayers are being disserved by most of their elected federal officials, who refuse to do their job. If you or a co-worker behaved this way, you or they would be fired.
This process should commence immediately.
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Technorati Tags: National Debt, Economy, Liberalism, Government
Tuesday, April 19, 2011
Our tax system is broken, ridiculously complex,
and horribly costly
“The fundamental principles of economics are not hard to understand,” writes Hoover Institute fellow and economist Dr. Thomas Sowell, “but they are easy to forget, especially amid the heady rhetoric of politics and the media.” Perhaps that helps to explain why so many Americans seem to think a $14 trillion national debt and annual deficits of $1.5 trillion aren’t really a problem.Misunderstanding or misapplying sensible economic principles is easily observed in the US government, the governments of several of the United States, as well as the socialist governments of several European countries (that our leaders for some odd reason seem to think we should emulate). There is ample evidence illustrating that the path we are on leads over a very steep cliff, but many of our elected public servants seem undisturbed by this.
Current “progressive” reasoning holds that everyone should be financially equal. There should not be rich, poor and middle class; everyone should be middle class. Despite the fact that achieving this fairy tale is not possible, many in government attempt to equalize financial circumstances, but they do so by treating people unequally, which seems to be a logical inconsistency of that flawed philosophy. Logical inconsistency and hypocritical processes are apparently okay when you are trying to impose equality on people who are legitimately and inherently unequal.
In order to make Peter, a physician earning $250,000 a year, and Paul, a high school dropout who can’t hold a job, equal, the American government has been tailored to take money from Peter through a high income tax rate and give it to Paul in the form of government support like welfare or unemployment payments. Socialist playwright George Bernard Shaw explained this concept thusly: “A government which robs Peter to pay Paul, can always count on the support of Paul.”
This viewpoint has produced one of the most progressive tax systems in the world, according to Cato Institute senior fellow Richard Rahn, one that has become much more progressive in the past 30 years.
A “progressive” tax system is one in which higher income earners pay higher tax rates than lower income earners, never mind that wealthier individuals pay more dollars in taxes than those earning less, even if they aren’t targeted with a higher tax rate.
Not only does our tax system depend upon unequal treatment to make everyone equal, its complexity robs the economy of billions of dollars. Economist Arthur Laffer notes that taxpayers pay an amount approximately equal to 30 percent of total collected income tax to comply with and administer the US tax code, about $431 billion. Of that amount the Internal Revenue Service requires $12.4 billion in administrative costs, and racks up another $9.3 billion in costs for comprehensive audits.
And so, Mr. Rahn writes in The Washington Times, whereas the top one percent of taxpayers earns just 20 percent of total income, it pays 38 percent of all income taxes; the top 10 percent earns 46 percent of total income, but pays 70 percent of income taxes; and the bottom 50 percent earns 13 percent of total income, but pays less than three percent of income taxes. At some earnings level people do not make enough to warrant taxing them, but currently 47 percent of American households pay no income taxes. Is that right and fair? What stake do the non-payers have in how their government works?
Those who foment class warfare look foolish when they screech about the rich not paying enough: they already pay far more than anyone else; 38 times their proportion among taxpayers.
Mr. Rahn says that when a relatively small minority of taxpayers pays the bulk of the taxes and most Americans pay little or no income tax, there’s an increasing disconnect between benefits from government and what most citizens pay for. “One result is a greater polarization in the political realm where a majority of citizens increasingly demand (sic) more government benefits for which they want others to pay,” he wrote.
Furthermore, “the Swedes were on this same destructive path, but they reversed course over the last couple of decades and made their tax system far less progressive …,” he noted. “The result has been a tempering of demand for new government services as people at all income levels realize they will be the ones paying for those services and not some mythical ‘rich’ person. The side benefit is that Sweden, as a result of tax and other reforms, now has one of the highest economic growth rates in the world.”
President Obama, who was against extending the Bush tax cuts for all taxpayers before he took credit for extending them, now has a "debt reduction" plan of his own that would supposedly cut $4 trillion from the national debt. If this sounds strange coming from someone who had to be dragged kicking and screaming to acknowledge that spending had to be brought under control, don’t think a transformation has occurred. His plan relies on tax increases, including ending the Bush tax cuts for everyone and increasing taxes on those making more than $200,000 a year, not spending cuts, the opposite of what worked for Sweden.
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Technorati Tags: Taxes, Politics, Liberalism, Government
Tuesday, April 12, 2011
Democrats behaving badly: Hysteria on display
over spending cuts
As last week progressed the prospect of a government shutdown loomed, and some Americans had a hissy-fit. Demagogues did their level best to make it seem as if the world would end if the government was shut down, although not long ago a snowstorm in DC shut things down for a couple of days, and no one seemed to notice.The Heritage Foundation provided some insight on just what a government shutdown really means: “During the last shutdowns, only 20 percent of Washington-area federal contracts were suspended, as were visa and passport applications, bankruptcy cases, and firearm applications. About 368 national parks closed. But the Department of Defense, power grid maintenance, border patrol, Coast Guard, air traffic controllers, inpatient and emergency outpatient medical care, and other vital services continued.”
Not so bad, really. The world didn’t stop spinning. Some inconveniences, to be sure, but you know what? Sometimes stuff happens, and we have to behave like adults when it does.
Still, even though our government is grossly inefficient, wastes tons of taxpayer money, and needs a major overhaul, there is something unseemly about having it “shut down.”
Customarily, government operates year-to-year on revenue/spending plan, a budget, the process for which is guided by a set of procedures laid out in the Congressional Budget Act of 1974, beginning with the President’s annual budget request, then action by Congress.
But not for FY2011.
Ask Congressional Democrats why no budget was enacted. At the time it should have been proposed, debated and approved they held a solid majority in both houses of Congress. They must have been busy doing other things.
So, dereliction of duty by the Congressional majority means the government has kept running through a series of short-term Continuing Resolutions that fund government functions, essential and non-essential alike, and whether we can afford them or not. Along the way many members of the Democrat majorities were replaced in the November election by new faces that ran on fiscal irresponsibility, because voters understand that we must dramatically cut spending, and said so loudly on Election Day.
Congressional Democrats, however, still haven’t gotten the message and would prefer not to make any cuts. When pressed they grudgingly agreed to cut spending by $38 billion, which sounds like a lot. But this year we will spend $1.65 trillion more than we collect, and a cut of $38 billion is comparable to cutting 38 cents off of a $165 invoice.
And for some reason, everyone is celebrating.
And after having created this crisis by not passing a budget, Congressional Democrats like DC Rep. Eleanor Holmes Norton, and New York Rep. Louise Slaughter adopted hysteria and hyperbole as their mode of response to Republican efforts to tie spending cuts to the Continuing Resolution to keep the government running. Rep. Norton shrieked, “We are absolutely outraged. This is the functional equivalent of bombing innocent civilians.” And Rep. Slaughter: “In 1994, people were elected simply to come here to kill the National Endowment for the Arts, now they’re here to kill women,” she ranted. (Reports that they held their breath and stomped their feet could not be confirmed.)
Did alien beings take control of these two women? In response to these absurd performances, a corps (not corpse!) of psychiatrists has been dispatched to the Nation’s Capital to try to calm down the frenzied pair, or failing that, find a couple of spare beds for them in the nervous hospital.
Such gross exaggerations are out of bounds and likely reflect the disdain with which these elected public servants regard their bosses’ demand for spending cuts.
What we see today is the predictable, perhaps unavoidable result of government giving money to segments of the private sector, a situation where government largesse has reached an unsustainable level, and must be stopped. And the reaction of the recipients of that largesse and their government enablers is loud, angry and, as illustrated above, sometimes irrational. It would have been better to not have given these hand-outs in the first place than to have to stop giving them because they are not economically feasible.
And that would have been the constitutionally appropriate course. Government should not subsidize private sector entities; not oil companies, green energy companies, farmers, Planned Parenthood, banks, public broadcasting, or anything else. That’s what is wrong here, and such imprudence was not contemplated by the Founders, who figured future Americans would be smarter than we have turned out to be.
However, Democrats and Republicans were able to find a funding plan that was mutually acceptable and ward off a shutdown for a few days, leaving the details of funding the government through September 30 for this week. Unfortunately, the spending cuts agreed to are far too modest to make a noticeable dent in the deficit.
No sensible person believes we can continue spending billions more than we take in. We have to stop that, and immediately begin to reduce spending to a sensible level, like 18 percent of GDP. That would produce a budget of $2.63 trillion, and if we can’t run a constitutionally proper and efficient government on that amount, we ought to ask Great Britain to take us back.
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Technorati Tags: Economy, Government Shutdown, Liberalism, Democrats
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