Even though the recession officially ended in June of 2009, America’s economy continues to languish:
In 1992, when Bill Clinton was running for president against incumbent George H.W. Bush in a much stronger economy than we have today, the major focus of Democrats was, “It’s the economy, stupid.” That is not their focus today. Mitt Romney’s tax returns are far more important to them. If you are one of those wondering about Mr. Romney’s tax returns, ask yourself this question: If the tax laws are written to encourage people to do certain things that limit their tax liability through deductions or credits (such as charitable contributions), and if a high earner like Mitt Romney does some or all of those things the tax laws encourage taxpayers to do, and by doing those thing he pays little or no taxes to the federal government, why should anyone be concerned about that, or try to make Mitt Romney out to be some sort of un-American tax-dodger? The answer, of course, is that the Democrat’s record provides nothing for them to talk about. They have made little if any progress against the nation’s substantial economic problems. Actually, if it was just that Democrat policies haven’t improved things, we would be better off than we are. But Democrat policies have made things worse, and more bad news is on the horizon. A July survey by the National Federation of Independent Business revealed that the top three concerns of small businesses were taxes, regulations, and poor sales. These concerns pose a significant problem, because small businesses are America’s job creators, the engine of the American economy. The Small Business Administration estimates that small businesses create about 65 percent of the nation's net new jobs, or jobs created minus jobs eliminated. There are 1.2 million small businesses that employ workers and make more than $200,000 a year, and which pay taxes as individuals. The expiration of the “Bush tax cuts” raises their taxes and Ernst & Young estimates that more than 700,000 jobs will be lost. The Heritage Foundation reports that "During the first three years of the Obama Administration, 106 new major federal regulations added more than $46 billion per year in new costs for Americans. Hundreds more regulations are winding through the rulemaking pipeline as a consequence of the Dodd–Frank financial-regulation law, the Patient Protection and Affordable Care Act, and the Environmental Protection Agency's global warming crusade, threatening to further weaken an anemic economy and job creation."
- The national debt will have grown from $10.7 trillion at the end of 2008 to $15.8 trillion by the end of 2012 – that’s about $51,000 for every American citizen (adults and children) – and will exceed total Gross Domestic Product for the first time since right after WWII.
- Of every dollar the federal government spends, 40 cents is borrowed.
- The unemployment rate has been above 8 percent since February of 2009.
- As of this July 13.4 million Americans were unemployed, and nearly 21 million others were underemployed or have given up looking for work, about 22 percent of the workforce, altogether.
- At July's rate of job growth – 163,000 new jobs – it would take more than eight years to get back to full employment.
- Gross Domestic Product was negative for several months and has been mostly 1.0 to 2.5 percent for the last three years. In only two of the last 13 quarters has GDP been what is regarded as relatively strong growth of 4 percent or more.
- The United States’ economic freedom score of 76.3 puts it in 10th place in the 2012 Index. Its score is 1.5 points lower than last year, reflecting deteriorating scores for government spending, freedom from corruption, and investment freedom. The U.S. is among 23 countries rated “mostly free.”
- Social Security owes $11.3 trillion more in benefits than it will receive in taxes. That includes $2.7 trillion to repay special-issue bonds and $6.5 trillion for benefits after the trust fund is exhausted in 2033. That is an increase of $2.2 trillion from last year’s report, and is the largest one-year drop in the program’s finances in nearly two decades. The system ran a deficit for 2011 of $11.5 billion.
- The U.S. Senate has not acted on proposed budgets in over three years.
- One of every three Americans – more than 100 million of us – receives some form of support from the government, and nearly half of American workers pay nothing to support the federal government.
Businesses are also suffering from reduced sales, since so many people are out of work, and further impacted by rising fuel prices. This forces businesses either to raise prices to recoup the additional costs, which further discourages sales, or to absorb the costs, affecting profitability. Higher costs discourage hiring, and lower profits put businesses at risk of closing. But let’s not let these dire circumstances cause us to take our eye off the ball. As the election approaches, we have to focus on Mitt Romney’s tax returns and other similar less significant things than the horrible economic and jobs pictures.
The purpose of every investment – however ordinary or unusual; however simple or complex – is to make money through earned interest or dividends, or profiting from sales of items, services or businesses.
Whether it is a passbook savings account or a Certificate of Deposit; corporate or municipal bonds or shares of stocks; your employer’s pension plan that grows in value to fund retirement; investing in a business and working to have more revenue than expenses; or investing in a private equity firm that buys existing businesses and hopes to build the value of those businesses, profit is the reason people invest.
Nearly everyone understands and accepts that they should collect earnings from a savings account or a stock purchase, but many of these same people are horrified when business owners sometimes make a good living or private equity firm partners make significant money in their activities.
Some seem to think that the purpose of business is to achieve social goals, and try to impose all sorts of their favored ideals on the business world. While many businesses do support community or charitable programs, these are secondary activities. Making a profit so they can remain in business is their primary purpose.
Like every other investment, the purpose of putting money at risk by investing in a private equity (PE) firm is to make a profit, and PE firms do that by buying companies and selling them. They don’t buy successful companies because the price of a successful company is already high, and trying to make a successful company even more successful, and therefore more valuable, is mostly a no-win situation.
Instead, they buy companies that are failing or underperforming, because like a house that hasn’t been taken care of and needs a lot of work, these companies can be purchased at a relatively low price.
Perhaps the company needs to upgrade its equipment or processes; maybe management is stagnant, failing to make good decisions or timely decisions; or it spreads production components too thinly over too many products; or sometimes it must reduce employment to save the company. A fresh look by new owners with particular expertise in what the company does may very well turn it into a profitable entity. That is the bet that private equity firms make.
The firm then uses its expertise to recommend steps to improve the operation and performance, and the company most often prospers, grows, and creates jobs. The improved company is naturally more valuable than when it was purchased, thus the selling price is higher, and sometimes much higher. In three to five years the PE firm would sell the company at a profit, making money for its investors.
This isn’t magic. This isn’t criminal. This isn’t greedy. It is purely logical. And, furthermore, it was the intention from the start, along with producing the positive economic benefits it created and the products and services that it produced to satisfy the wants and needs of consumers.
So, the people investing in private equity firms put their money on the line, risking it on the hope that the firm will successfully buy and turn around poorly performing companies, and sell them at a profit.
However, private equity firms do not always succeed in turning around a purchased company, and in such cases the failed company is closed and people lose their jobs, and yes, the investors lose money.
The private equity folks can’t win. They get criticized as greedy when they succeed in turning around a failing company and then selling it for a handsome profit, and when it fails to turn a company around and the company closes and people lose their jobs, they get portrayed as profit-hungry, selfish capitalists.
What many people do not or cannot understand is the fact that the companies PE firms cannot save likely would have shut down had they not stepped in, and likely much sooner if it had not been acquired. And then there are those who use the pain of lost jobs and closed businesses as opportunities to further their political goals.
This is yet another example of how the American public’s abysmal understanding of how the economy works not only impedes the process of implementing favorable policies that will allow the economy to grow, but also arms demagogues with tools to take advantage of us for their selfish purposes.
There are other facts that need to be emphasized. First, if PE firms weren’t successful most of the time, savvy people would not invest in them. And, private equity investors use their own money in these endeavors, rather than taxpayer money, so no public money is lost in the relatively few times that they fail to turn a company around.
In “American Restoration: The Role of Private Equity,” an article on the Heritage Foundation’s website by J.D. Foster, Ph.D., the author explains that private equity firms “don’t always succeed. But their very existence and the [large] profits they reportedly make testify that they succeed far more often than they fail, and a lot of Americans can thank their continued employment to the prowess of these American restorers.”
- The Center for Immigration Studies released a detailed report that correlates high levels of illegal/legal immigrant poverty as contributing to the increase in welfare programs in the U.S. A study by the Federation for American Immigration Reform shows that illegal immigration costs U.S. taxpayers about $113 billion a year at the federal, state and local level. About $84 billion is absorbed by state and local governments. Strong border control by the federal government, and eliminating federal interference with state efforts to control illegal immigration could substantially reduce this wasteful expense.
- The Heritage Foundation reported last year that “Texas created 37 percent of all jobs since the beginning of the economic recovery, more than any other state. Excluding New York and Pennsylvania, Texas has created nearly as many jobs as all other states combined.” According to Richard Fisher, president of the Federal Reserve Bank of Dallas, “Texas is doing so well relative to other states precisely because it has rejected the economic model that now prevails in Washington. … Texas stands out for its free market and business-friendly climate.” Among other factors, Texas has right-to-work laws, ongoing tort reform, has no state income tax, and has generally been a fiscally responsible state. As a percentage of its economy, the state’s budget is lower than the majority of other states.
- “I don’t think Mitt Romney understands what he’s done to people’s lives by closing the plant,” Joe Soptic, a former employee at GST Steel in Kansas City, said in a Democrat PAC TV spot. He says he lost his health care, and then his wife became ill and died shortly after that. The Washington Post reports, however, that Republican candidate Romney left Bain Capital two years before the GST’s 2001 bankruptcy; Politico notes that Ranae Soptic died in 2006, long after the plant closed; and CNN reports that at some points during that time she had insurance through her own employer. Hmmm. Senator Majority Leader Harry Reid (D-Nev.) said in an interview with the Huffington Post recently that someone had called him to tell him that Mitt Romney didn’t pay taxes for 10 years. "Harry, he didn't pay any taxes for 10 years," Reid recounted the person as saying. "He didn't pay taxes for 10 years! Now, do I know that that's true? Well, I'm not certain," Senator Reid said. A very good friend of mine who lives and works in Washington, DC, called me after hearing this, and said that “ol' Harry has been seen frequently peeking in Nancy Pelosi's windows and eating at Chick-fil-A.” Well, that’s what he said. Paraphrasing a popular saying, there are lies, damned lies, and the Obama campaign.
- Voter-registration forms being mailed to Virginia residents are addressed to dead relatives, children, family members in other states, non-U.S. citizens, people with similar names, existing registered voters and residents' cats and dogs. These forms are among tens of thousands being distributed in Virginia by Voter Participation Center, a Washington-based national voter-registration group. The organization pre-populates the documents with key information, including names and addresses of prospective voters. This worries election officials, who say the mailings can create opportunities for voter fraud. But, of course, Attorney General Eric Holder opposes requiring voters to show proof of their eligibility, saying that doing so would suppress voter participation.
- Anyone who has spent much time watching the Olympics likely believes that the success of the remarkable people on the American team is due to a lot of individual dedication and hard work. However, the success of American Olympic athletes and the success of American small businesses are analogous. Like business people who didn’t build the roads, and other infrastructure that they used to make their companies successful, the Olympic athletes didn’t build the training facilities or the fields and courts that they utilized to become successful in their sport, and they didn’t start the Olympic Games that they now participate in. They didn’t earn those medals. Somebody else did that.
- Seeking to rally a crucial constituency, President Barack Obama on Wednesday warned women in swing-state Colorado that Mitt Romney and the Republicans “want to take us back to the policies more suited to the 1950s than the 21st century.” Ah, yes, the 50s, when health care costs were so low you didn’t need health insurance (and it wasn’t even available); where you didn’t call the doctor or go to the hospital unless you were really sick; where doctors made house calls; a day in the hospital cost tens of dollars; healthcare was about 5 percent of GDP; “prospecting” lawsuits didn’t exist ... some things back then were way better than today. A new Congressional Budget Office report says that under Obamacare, 30 million non-elderly Americans will remain without health insurance in 2022. Wasn't the whole reason for Obamacare destroying our healthcare system to insure the uninsured?
More important than the lofty generalities candidate Barack Obama fed his fans about healing the planet, slowing the rise of the oceans, ending political divisions in America, and ushering in an era of hope and change, as President he and his administration gave Americans strong assurances of better things to come.
He promised to create five million new jobs just in the energy sector, and in promoting the $767 billion stimulus plan his economic advisors Christina Romer and Jared Bernstein predicted unemployment would not rise above 8 percent. In the first year of his presidency, Mr. Obama pledged to “cut the deficit we inherited in half by the end of my first term in office,” to “lift two million Americans from poverty,” and “jolt our economy back to life.”
The President told NBC’s Matt Lauer January of 2009, “If I don't have this done in three years, then there's gonna be a one-term proposition.”
Last week’s July jobs numbers show continued misery across the nation, again calling attention to Mr. Obama’s failure to deliver on his economic pledges. Since he didn’t “have this done in three years,” why is he running for re-election?
The unemployment rate ticked up to 8.3 percent, far above the 5.6 percent rate that his economic team predicted for July 2012 if Congress passed the $767 billion stimulus plan.
The Bureau of Labor Statistics (BLS) report for July showed that 195,000 fewer people were working in the U.S. than in June. Further, the BLS figures showed that 150,000 more people became discouraged and dropped out of the labor force.
Nevertheless, Mr. Obama struggled to put a positive spin on these dismal numbers, boasting, “we tried our plan — and it worked.”
Really? Let’s review the results: Forty-two straight months of unemployment above 8 percent; 8.2 million people working part-time who want full-time work; a record 88 million Americans who are not in the labor force; 1.9 percent GDP growth in the past quarter; $5 trillion in new debt; the downgrading of the U.S. credit rating; 38 percent of Americans living paycheck to paycheck; 45 million Americans on food stamps; food prices continuing to increase dramatically; and the poverty level likely to rise to the highest level in nearly fifty years.
If this is what a successful Obama economic policy looks like, let’s go back to the Bush years, where those “top-down” economic policies Mr. Obama so loves to hate created 52 straight months of job creation, and an unemployment rate that never exceeded 6.3 percent following the September 11, 2001 terrorist attacks, despite the attending chaos they caused. Oh, for the good old days.
The continued poor economy and dismal jobs pictures since he won the office he so aggressively sought are precisely what would we should expect from Mr. Obama’s big spending economic philosophy.
On the campaign trail, he said, “You grow an economy from the middle out, and from the bottom up. …When middle-class families have money in their pockets, they go out and buy that new car or that new appliance or the new computer for their kids or they go out to a restaurant – heaven forbid they take a vacation once in a while – and that money goes back into the economy and businesses do well because they’ve got more customers.” That same example applies to wealthy Americans.
The example supports leaving more money in the private economy, which is a point in favor of low income taxes for all. However, it omits a critical element: Before mom and dad can buy a new car or even a toaster, at least one of them has to have a job.
However, if they work in the coal industry or the space industry, or in a related business, thanks to the Obama administration there’s a good chance they either don’t have a job, or soon will lose it.
At a time of dangerously high unemployment, Mr. Obama’s jobs program focuses not on creating jobs, but on killing jobs. The coal industry is dying – or rather is being executed – as extreme air quality goals imposed by the Environmental Protection Agency force coal-fired generators to shut down, meaning consumers could see their electricity bills jump an estimated 40 to 60 percent in the next few years. The decreased demand for American coal shuts down mining and related companies, putting more people on the unemployment line.
His policies have produced high unemployment in Brevard County, Florida, the home of the Kennedy Space Center, which peaked in double digits, but now is about nine percent. That is somewhat lower than it otherwise would be because space industry workers had to leave the County to try to find work after the President scrapped the second manned moon mission in 2010.
In the grand scheme of things the jobs lost in the space and coal industries and in supporting businesses may be only a fraction of the total. But Mr. Obama should be held to account for policies that deliberately kill jobs in a time of already high unemployment.
This callous disregard for American jobs is not among the characteristics that voters should expect to find in their president.
Following the theater shooting in Aurora, Colorado the predictable calls for gun control have surfaced once again. These emotional reactions are understandable in the face of evil, horrific events like this one. However, some objectivity on this subject is needed, so the following information may help establish some needed context. Some of the data in the following categories is not very recent, but is the most recent data that is available.
According to the Website justfacts.com, in 2009 the population of the United States was 307 million, and there were approximately 300 million firearms owned by civilians.
Nearly 45 percent of households, about 53 million, possessed a firearm, and one in three adults, nearly 80 million, owned a firearm. Among gun owners 67 percent said they owned a firearm for protection against crime, 66 percent for target shooting, and 41 percent for hunting.
U.S. Department of Justice data reveals that roughly 5,340,000 violent crimes (assaults, robberies, sexual assaults, rapes, and murders) were committed in the United States during 2008, and that about 436,000 or 8 percent were committed by offenders visibly armed with a gun.
A paper published in the Journal of Criminal Law and Criminology
discussed a 1993 nationwide survey of nearly 5,000 households that showed that over a five-year period “at least 3.5 percent of households had members who had used a gun ‘for self-protection or for the protection of property at home, work, or elsewhere,’" and that totaled more than one million incidents per year.
The Website for the Bureau of Justice Standards (BJS) at the U.S. Department of Justice contains the following relevant points:
- As of 2008, data showed that firearm-related crime had plummeted since 1993.
- The 1997 Survey of State Prison Inmates, showed that among those possessing a gun, the source of the gun was from a flea market or gun show less than 2 percent of the time; a retail store or pawnshop about 12 percent of the time; and from family, friends, a street buy, or an illegal source about 80 percent of the time.
- Two sources, an article in the journal Society and in the Journal of Criminal Law and Criminology reported in 1993 and 1995 respectively that gun-related violence is most common in poor urban areas and in conjunction with gang violence, often involving juveniles or young adults.
So, firearm-related crimes were substantially down in 2008; earlier surveys showed prison inmates admitted getting guns primarily from family, friends, a street buy or an illegal source; and only 8 percent of crimes were committed by criminals who definitely had a gun. Couple that with the fact that some cities with high rates of gun crimes – Chicago, Washington, DC, New York and Detroit, to name four – have some of the strongest gun control laws. Those data argue against, not for, more stringent gun control laws.
Colorado’s Democrat Governor John Hickenlooper acknowledged that stricter gun control laws would not have prevented the carnage in Aurora during an interview on CNN’s “State of the Union”: “This person, if there were no assault weapons available, if there were no this or no that, this guy’s going to find something, right? He’s going to know how to create a bomb. Who knows where his mind would have gone. Clearly a very intelligent individual however twisted.”
Gov. Hickenlooper understands what so many people do not understand: that what is at the root of horrific events like this one, and the Columbine High School shooting, the 9-11 terrorist attacks, the Virginia Tech shooting, the Fort Hood shooting, and every other such incident, is what is in the mind and heart of the perpetrators.
Someone offered the idea that if at least one person with a concealed-carry permit had been allowed to carry a firearm into that theater, the killer might have been stopped. Unfortunately, it is against the law for anyone to carry a concealed weapon in Aurora, so the only one with a weapon in that theater was the perpetrator. All of the gun owners there that morning were law abiding citizens, except the shooter. Odd, isn’t it: murderers and other criminals do not obey laws. And even though police were nearby for crowd and traffic control for the midnight movie, they didn’t stop this miscreant.
Some will counter that if some movie-goers were armed their efforts to stop the murderer would have produced even more carnage. We’ll never know for sure, but it’s hard to imagine that more than 70 people would have been injured or killed. However, it is possible that if the murderer knew that people in that theater were armed, he might not have gone there.
Most ideas for new gun laws are simplistic and won’t work, and they won’t work because they focus on the wrong thing. It isn’t guns that kill people; it is the people misusing the guns.
Fortunately, the sentiment to pass more gun control laws is not strong, although the United Nations Arms Trade Treaty and proposed amendments to the Cybersecurity Act still represent back-door efforts to subvert the constitutional protections contained in the Second Amendment.
Recent dishonesty demonstrates why the mainstream media is largely no longer worthy of the trust of the American people.
Following the massacre of movie-goers in an Aurora, Colorado theater early last Friday morning, ABC’s Brian Ross twisted himself into knots to connect the violence with the Tea Party on “Good Morning America” with George Stephanopoulos. Here is the text.
Stephanopoulos: I’m going to go to Brian Ross. You’ve been investigating the background of Jim Holmes here. You found something that might be significant. Ross: There’s a Jim Holmes of Aurora, Colorado, page on the Colorado Tea Party site as well, talking about him joining the Tea Party last year. Now, we don’t know if this is the same Jim Holmes. But it’s Jim Holmes of Aurora, Colorado.
So, Mr. Ross, if you don’t know “if this is the same Jim Holmes,” why even mention this? It’s not like “Jim Holmes” is so unusual a name that it couldn’t be shared by multiple individuals. Is wild speculation your idea of responsible journalism? Or, are you just taking advantage of a horrible crime and the pain it caused to score cheap political points for your own ideology?
Even if it was the same Jim Holmes, there was no indication that the shooting had any connection whatsoever with the Tea Party. Like the shooting of Congresswoman Gabrielle Giffords last year, this is another pitiful and failed media attempt to tie the Tea Party to violent acts.
ABC issued a correction, and then an apology, and that likely will be the extent of its efforts at contrition. However, the family of the man Mr. Ross falsely connected to the shooting was still getting death threats days later.
Question: How can anyone trust Brian Ross’ reporting hereafter, or that of ABC?
The cable network MSNBC got caught manipulating a comment by Republican presidential candidate Mitt Romney, totally changing the context of a statement he made in order to ridicule and demean him.
The fraud that MSNBC anchor Andrea Mitchell palmed off on her viewers painted Mr. Romney as an out-of-touch elitist who doesn’t understand how retail commerce works.
Ms. Mitchell introduced a video clip, saying “I get the feeling – take a look at this – that Mitt Romney has not been to too many Wawa’s [convenience stores] along the roadside in Pennsylvania.” In the clip, Mr. Romney comments: “I was at Wawa’s, I wanted to order a sandwich. You press the little touch tone keypad, alright, you just touch that, and you know, the sandwich comes at you, touch this, touch this, touch this, go pay the cashier, there’s your sandwich. It’s amazing.”
Ms. Mitchell and her accomplice yuck it up at the candidate’s obvious ignorance of this common method of selling food: “It’s amazing,” she smirks.
But she pulled a fast one on viewers who trust her to honestly tell them what is going on the in the world. What actually happened was that Mr. Romney, prior to relating the Wawa’s anecdote, commented on how a friend had a simple procedure badly mangled by incompetent government bureaucracy that required him to fill out a 33-page form to notify the government of his change of address. Twice.
He was contrasting government inefficiency with the efficiency and innovative nature of the private sector. But that’s not the message Ms. Mitchell wanted her viewers to get, apparently.
Question: Is Andrea Mitchell’s reporting trustworthy?
After the shooting death of 17 year-old Trayvon Martin by George Zimmerman in Florida, a large number of people, aided by media reports, rushed to judgment accusing Mr. Zimmerman of a racially motivated killing of the young man we all came to know from the photo of an angelic-looking youngster taken when he was 12 years-old.
Whether Mr. Zimmerman committed a crime, or merely defended himself will be determined at trial, which every American – even those knee-jerks who jumped to the conclusion that the shooting was racially motivated – needs to understand is the proper setting for such determinations.
News organizations are expected to accurately report to the public what is known about events. A well-informed public is less likely to react emotionally and inappropriately, as so many did in the Trayvon Martin shooting. These days it seems the mainstream media frequently ignores ethical standards.
Supporting that point is the way NBC News edited the recording of Mr. Zimmerman talking with a police dispatcher, and creating the impression that Mr. Zimmerman had a racial prejudice against Trayvon Martin. It then broadcast this deception on the “Today Show”: “This guy looks like he’s up to no good. He looks black,” George Zimmerman tells police in NBC’s edited version.
Here, however, is original text of the call: Zimmerman: This guy looks like he’s up to no good. Or he’s on drugs or something. It’s raining and he’s just walking around, looking about. Dispatcher: OK, and this guy — is he black, white or Hispanic? Zimmerman: He looks black.
In these examples, people were deliberately trying to manipulate you with fraudulent reporting, or they are incompetent. When news organizations slant the news, or manufacture the news, whatever the cause, it is unethical, underhanded and unforgiveable.
“Regulation and litigation are the bane of business,” according to CNBC in its 2012 America’s Top State for Business survey. “Sure, some of each is inevitable. But we graded the states on the perceived ‘friendliness’ of their legal and regulatory frameworks to business.”
While some states, counties and municipalities are friendly to businesses, others employ policies that drive them away. Among states, Texas and California epitomize these two extremes. With its free-market economic reforms of the last several years Texas has created more than 410,000 jobs since the recession began in 2007, while California has lost nearly 900,000 over that same period. Once again, Texas tops the CNBC list, the third time in five years, besting last year’s winner, Virginia, which dropped to third place.
If a state wants to create jobs, what should its governor and legislature do? Well, they could seek the wisdom of a professor of sociology, a police officer, or a pathologist, an NBA star, or a Nobel Laureate in physics, all knowledgeable people in their field. But to find out how to encourage job creation, you might get the most useful information from employers about what they look for in choosing a suitable environment in which to operate, and then make the state’s environment as close to what they told you as possible.
This common sense prescription desperately needs to be applied at the federal level, where anti-business policies that have kept the United States in recession-like conditions for the last 41 months thrive. Perhaps someone in a position of power in Washington will take notice of how states work to attract or repel business and it will serve as a wake-up call, although recent history argues strongly against that happening.
In answer to the question of how to create jobs, one CEO told Chief Executive Magazine the following: “Do not overtax business. Make sure your tax scheme does not drive business to another state,” he said. “Have a regulatory environment and regulators that encourage good business—not one that punishes businesses for minor infractions. Good employment laws help too. Let companies decide what benefits and terms will attract and keep the quality of employee they need. Rules that make it hard, if not impossible, to separate from a non-productive employee make companies fearful to hire or locate in a state.”
Businesses also seek an environment with consistent policies and regulations that allow them to plan for a significant period into the future, as well as an overall positive attitude toward business and a productive work ethic among its population.
None of that seems particularly radical, and in fact seems very logical. It just makes sense to keep taxes and regulations from impeding job creation, and during times of high unemployment to at least relax those that get in the way. Destructive federal policies have been in effect and stifling job creation throughout President Barack Obama’s term. In February 2009 the unemployment rate shot through the 8.0 percent barrier that the president assured us would never be breached, and it remains above that mark today.
The top five business friendly states in the CNBC survey are: Texas, Utah, Virginia, North Carolina, and North Dakota, while the bottom five are: Mississippi, Alaska, West Virginia, Hawaii, and finishing last, Rhode Island.
Most of the highest ranking states share features like lower tax burdens, governments more amenable to allowing economic growth, little or no union labor, and, as it turns out, state governments dominated by Republicans.
Of the top 10 states in the survey, seven have both Republican governors and legislatures, and of the bottom 10 states, six have Democrat governors and legislatures. Of the top ten states, only two have Democrat governors and in the top 20 there are only five Democrat governors.
It is also worth noting that Republican leaders in the high ranking states support economic policies that mirror the national Republican platform.
Obviously, facts illustrating which political party has policies that generally foster a better job creating environment will not please Democrats, but it is what it is. Of course, policies that promote a positive business environment are not necessarily restricted to Republicans, and Colorado’s business-friendly Democrat Governor John Hickenlooper proves the point: His state sits eighth among CNBC’s top states. It just happens that Republicans generally promote policies that encourage job creation, economic growth, and wealth creation, whereas Democrats, who adhere to liberal, or so-called “progressive,” values generally promote policies that obstruct these things.
It is not difficult to find the answer to the question, “in times of high unemployment and economic stress, which political party will be most likely to create an atmosphere that will allow the private sector to correct these problems?”
And once that answer is found, everyone who cares about creating jobs and improving the economy must vote for candidates that support policies like those adopted by the states at the top of the CNBC survey that will make it possible to improve the economy and create jobs, and finally turn Mr. Obama’s stagnated economy into a recovering economy.
CNN Money reported in April that “more than one in three Americans lived in households that received Medicaid, food stamps or other means-based government assistance in mid-2010,” citing a study by the Mercatus Center at George Mason University.
“Some 26 percent of Americans lived in households where someone received Medicaid, while the figure was 15 percent for food stamps,” the report continued. “Those programs were by far the largest of the safety net.”
And, when Social Security, Medicare and unemployment benefits are included, nearly half of the nation -- more than 148 million Americans – lived in a household that received a government check, the CNN Money report continued.
It is shocking enough that so many of us get some form of government support – although Social Security and Medicare recipients are receiving money they paid into the system – but most stunning is that the price tag for all of that support hit the $2 trillion mark for fiscal 2010 and that the 2010 figure is nearly 75 percent higher than ten years ago.
Government Gone Wild reports that 41 percent of all births and 60 percent of all elderly long-term care is paid for by government, and that one out of three Americans lives in a household that receives food stamps, subsidized housing, cash welfare or Medicaid.
The food stamp program has been given the stigma-free title “SNAP” (Supplemental Nutrition Assistance Program) and the government now spends our tax money advertising food stamps to attract even more takers.
And, according to Judicial Watch, as part of the administrations’ campaign to eradicate “food insecure households,” the U.S. Department of Agriculture (USDA) awarded what the Oregon Department of Human Services (DHS) called a $5 million “performance bonus” for ensuring that Oregonians eligible for food benefits receive them and for its “swift processing of applications.”
It is the fifth consecutive year that Oregon has been recognized by the federal government for “exceptional administration” of the entitlement program, according to the DHS new release. One of every five Oregon residents receives food stamps, 780,000 in all, and that is 60 percent higher than in 2008.
And then there are unemployment benefits, at one point lasting up to 99 weeks – nearly two years. Even in times of high unemployment there are jobs available, but generous benefits provided for an extended period dulls the incentive for people to look for work, or even to start up their own business to earn a living.
The owner of a temporary staffing agency told a Florida newspaper that some prospects just aren't interested in working; they'd rather pick up unemployment checks. Other sources say many of those out of work feel it would be silly to take a job that pays less than the unemployment benefit, while some are comfortable waiting until the “right” job comes along to go back to work or wait until benefits have almost run out to look for work.
Programs that are supposed to provide temporary assistance for people in poverty or out of work have turned into long-term welfare programs that are so generous that they remove the incentive to earn one’s own way from those they are intended to help and turn them into dependents.
President Barack Obama reminded a campaign audience recently, “We’re the country that built the Intercontinental Railroad [yes, that’s what he said], the Interstate Highway System. We built the Hoover Dam. We built the Grand Central Station.” He’s correct about that. Well, not about the Intercontinental Railroad. But America accomplished those great things through self-reliance and positive ambition; it wasn’t done with only about half of us paying taxes to support the federal government while one-third received support from the federal government.
Tax payers are the ones who fund these federal support programs, but Government Gone Wild reports that while the number receiving these benefits is on the rise, the number of tax payers is falling. During Ronald Reagan’s administration only 19 percent of households didn’t pay any federal income tax, under Bill Clinton it jumped to 25 percent, it rose to 30 percent under George W. Bush, and under Barack Obama it has jumped to 47 percent.
A warning about what results from providing too much help to people is making the rounds on the social medium Facebook. It appears in the form of a photo of a newspaper clipping that reads: “The Food Stamp Program, administered by the U.S. Department of Agriculture, is proud be distributing the greatest amount of free meals and food stamps ever. Meanwhile, the National Park Service, administered by the U.S. Department of the Interior, asks us to ‘Please Do Not Feed the Animals.’ Their stated reason is because the animals will grow dependent on handouts and will not learn to take care of themselves.”
America is fast becoming a nation of dependents, and that is dangerous for two reasons. First, we simply can’t afford the cost of supporting so many people. But perhaps more important, continuing to rob people of the incentive to provide for themselves through over-generous government benefits is weakening the strong spirit of individualism that made this nation great. We need more, not less, of that.
Last week U.S. Supreme Court Chief Justice John Roberts joined Justices Antonin Scalia, Clarence Thomas, Samuel Alito and Anthony Kennedy in correctly identifying the individual mandate in the Patient Protection and Affordable Care Act as unconstitutional. That is what the Supreme Court is expected to do: follow the original intent of the authors, who created a document to protect America from over-reaching government actions like this one.
Writing for the Court’s majority, Chief Justice Roberts said: "The individual mandate, however, does not regulate existing commercial activity. It instead compels individuals to become active in commerce by purchasing a product, on the ground that their failure to do so affects interstate commerce." He continued, correctly identifying the chaos that would result from finding the mandate constitutional: "Construing the Commerce Clause to permit Congress to regulate individuals precisely because they are doing nothing would open a new and potentially vast domain to congressional authority." Exactly. But the majority didn’t stop there.
Instead they decided the individual mandate is not really a mandate, it is a tax, essentially rewriting the statute and thereby making “Obamacare” the law of the land. But if, as Justice Roberts wrote, you cannot regulate individuals “because they are doing nothing,” how then can you tax individuals because they are doing nothing? This turns the definition of “taxation” on its head, taxes typically being levied on working, buying and owning, as opposed to levying taxes on not working, not buying, or not owning.
What exactly caused the Chief Justice, criticized by liberals for his judicial conservatism, to depart from his expected position? Many of those familiar with his thinking say the decision is in keeping with his values — conservative in his judicial views, but also considering the Court’s reputation. If the Court is seen as too conservative – adhering to the Constitution’s original intent too often – it may become unpopular with liberals.
Others believe he worked a brilliant bit of judicial magic by striking down the mandate, but upholding the statute’s constitutionality as a tax, preserving President Barack Obama’s signature accomplishment and allowing him to save face, but at the same time giving the law’s opponents a way to correct its many flaws.
Whatever the motivation, the ruling unfortunately opens the door for darn near any activity – or lack of activity – to be taxed by the federal government. As the legendary Chief Justice John Marshall famously said, “The power to tax is the power to destroy.”
Andrew P. Napolitano, former judge of the Superior Court of New Jersey, writing in The Washington Times, sees it this way: “If the feds can tax us for not doing as they have commanded, and if that which is commanded need not be grounded in the Constitution, then there is no constitutional limit to their power, and the ruling that the power to regulate commerce does not encompass the power to compel commerce is mere sophistry.”
This statute epitomizes dishonorable legislative methodology and bad law-making. Obamacare has been very unpopular with the public since it was first hatched, and it still is. Yet the Democrat majority in the House of Representatives lurched ahead, conceiving the bill behind locked doors, and the 2,700-page monstrosity was passed by the House before members even had time to read it. Remember then-House Speaker Nancy Pelosi arrogantly telling American citizens that they couldn’t know what was in the bill until Congress passed it? Senate Democrats bought enough votes with pricey concessions to key states to eventually pass the bill.
The measure was advertised vociferously by President Obama and his fellow statists as a mandate, not a tax, and it would not cause any American “making less than $250,000 a year to pay one dime more in tax.” The Act has now been upheld by the highest court in the land because it is a tax, not a mandate, and among the 21 new taxes are seven affecting those making less than $250,000 a year, some already in effect, according to Forbes.com.
They are: 1. The Individual Mandate Excise Tax, the higher of $1,360 or 2.5 percent of adjusted gross income; 2. The Over-The-Counter Drugs Trap denying use of pre-tax funds in special accounts to buy over-the-counter medicines for allergy relief and the like without a doctor’s prescription; 3. The Healthcare Flexible Spending Account Cap of $2,500; 4. The Medical Itemized Deduction Hurdle, increased from 7 to 10 percent of adjusted gross income; 5. The Health Savings Account Withdrawal Penalty of 20 percent, up from 10 percent; 6. The Indoor Tanning Services Tax of 10 percent; 7. The Cadillac Health Insurance Plan Tax of 40 percent.
The Democrats are celebrating their prize legislation’s Alice-in-Wonderland survival of judicial review, but now have to figure out how to explain to the American people that the bill they swore was not a tax on the poor and middle class really is a tax on the poor and middle class, in fact, the biggest tax hike in history.
You cannot sensibly praise the Supreme Court for upholding your flawed law, and then claim that the basis upon which it was upheld was incorrect. That twisted logic is beyond even the Obama administration.
In March of this year the federal Energy Information Administration (EIA)
released data showing that in 2011 coal was responsible for 42 percent of U.S. power production, a little lower than years past, but coal still is the most
commonly used fuel in producing domestic electricity.
Burning coal is dirty, but it is cleaner today than any time in the last 60 years. And mining coal is risky for workers, but so is commercial fishing, logging, flying airplanes, and farming/ranching, the four most dangerous occupations in the country. Yes, coal has its negatives, but so does every one of the energy sources suggested to replace it.
On the plus side, coal not only produces energy, it produces direct and indirect employment for hundreds of thousands of Americans, and billions in tax revenue from its production and sale, and from the income of industry businesses and workers.
Coal generates electricity in 48 states and is mined in 25 states. According to the National Mining Association (NMA) U.S. coal mining directly employs nearly 136,000 people, and the average coal miner earns $73,000 per year. For each coal mining job, an additional 3.5 jobs are createdelsewhere in the economy. For example, 60,000 people work in coal-fired power plants, and thousands more work in the transportation industry delivering coal to customers. The NMA estimates that 50,000 new employees will be needed in coal mining over the next 10 years to meet demand and to replace retiring workers. And, coal is projected to be the dominant fuel for electricity generation in the U.S. through 2035, according to the EIA.
This information ought to be seriously considered when the vast army of government regulators is hard at work making life more expensive, but not necessarily better. It was clearly ignored when the Environmental Protection Agency developed the Utility MACT Rule, which establishes the maximum achievable control technology (MACT) standards for emissions of hazardous air pollutants from coal- and oil-fired power plants. Primarily, Utility MACT targets mercury emissions.
You remember mercury. It’s the poison contained in every one of the new miracle light bulbs, called CFLs, which Congress mandated to replace the popular, inexpensive and safe incandescent bulbs we have used for decades. It is also released by coal combustion and the EPA fears it will settle into water supplies and cause birth defects when consumed by pregnant women.
The National Center for Policy Analysis (NCPA) recently commented on a study by the Competitive Enterprise Institute that
disputes the EPA’s data.“The EPA's December 2000 determination that triggered the rule assumed that 7 percent of pregnant women in the United States have blood mercury concentrations exceeding the agency's reference dose. In reality,
only 0.4 percent (one in every 250 pregnant women) had blood mercury levels exceeding the reference dose.”
“Furthermore, the EPA's reference dose is overly cautious: the EPA's reference dose is 1/15th the lowest exposure level
associated with mild, subclinical effects in epidemiological studies,” the NCPA reports. “Finally, the EPA produces no evidence of mercury exposure at these levels having any effect on unborn children.”
The report also says “EPA estimates that each year 240,000 pregnant women in subsistence fishing households eat enough self-caught fish to endanger their children's cognitive or neurological health, yet the agency has yet to identify a single woman who fits this description.”
The EPA justifies implementing this rule by claiming that the public health benefits of limiting coal burning will be greater than
the compliance costs. It claims the Rule will save $80 billion a year, but relies on achieving levels of particulate matter discharge well beyond levels generally recognized as safe.
Furthermore, the Federal Energy Regulatory Commission projects the Rule will result in losing 81,000 megawatts of electricity generation, almost eight times the EPA’s estimate.
American coal plants are vastly cleaner than those in other countries, where pollution control is virtually non-existent. China now emits more mercury than the United States, India, and Europe combined, and mercury pollution wafts across the Pacific to foul our air and water. The EPA would better serve Americans if it regulated China’s coal burning.
Americans for Prosperity predicts American families and businesses will see electricity bills rise by an average of 12 percent
nationwide and by as much as 24 percent in coal country, and this “burdensome regulation” will destroy over a million American jobs in the coming years.
The U.S. Senate had the opportunity last Wednesday to put a halt to this anti-coal, anti-common-sense scheme, but failed by a 53-46 vote.
Incomprehensibly, two coal-state senators, West Virginia Democrat Jay Rockefeller and Tennessee Republican Lamar Alexander, voted against the measure, along with four other Republicans. Clearly, Senators Rockefeller and Alexander have failed their constituents and their states.
The EPA grossly overstated the dangers of mercury from burning fossil fuels and grossly understated the harmful effects of
Utility MACT on the public. These folks will not be satisfied until every detectable particle of every substance that at some level of concentration might be harmful to something or someone is eliminated from the Earth, and they are eager to force job losses and higher consumer costs on us trying to achieve that impossible goal.