Politics

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What a real gov does – NYPOST.com

In the NYPost.com editorial, What a real gov does, I think we are likely seeing a break through in the process of constructing a balanced budget. If the polling confirms his position of “no new taxes”, we will likely see major cuts in those school districts, cities, and states across the country “who kicked the can down the road” for the next group of legislators to deal with. I would not be surprised if the polling reveals a preference by the voters to deal with these budget deficit problems now rather later. Although these budget cuts will be very painful the more interesting question is whether the legislators will cut deep enough to start offering modest tax breaks for new business startups and expansions that create jobs in the private sector.

New Jersey Gov. Chris Christie clearly is serious about doing what he was elected to do — getting the budget under control, without reflexively raising taxes.

Noting that Jersey’s current budget contains "the same worn-out tricks of the trade that have become commonplace in Trenton, that have driven our citizens to anger and frustration and our wonderful state to the edge of bankruptcy," Christie on Thursday declared a new day.

Facing a $2.2 billion deficit in the current budget, the governor imposed fiscal emergency measures: By executive order, he froze $1.6 billion in unused state funds and started chopping in the areas where the money is — education and health care.

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Obama’s Bank Tax: Missing the Target

I must give a hearty thanks to the Heritage Foundation for this article. I have been pursuing a better understanding of Fannie Mae subsidies ever since the Wall Street Journal published Katrina’s no-brainer idea that everyone should rally around the idea to tax the big banks to recoup the taxpayer-funded bailout. In an interesting twist of word meanings I agree with Katrina that taxing the big banks is no brain idea. It is difficult to understand how the average person finds the wisdom of picking a fight with commercial banks while we ignore the continuing financial disaster at Fannie Mae and Freddie Mac. So while the CBO and the Administration quietly debate when to recognize the increase in the national debt due to Fannie Mae and Freddie Mac and the Federal Reserve frets who will buy the mortgage backed security debt in April, the average person is presumed to be more interested in taxing banks rather than efforts to fix the biggest financial crisis of our generation.

In his State of the Union address Wednesday night, President Obama repeated his call for a tax on banks, calling it “a modest fee to pay back the taxpayers who rescued them in their time of need.” That sounds good, everyone agrees the taxpayer’s money should be paid back. But there’s a bit of misdirection going on here.

As shown in the chart above, most big banks have already paid back the government money they received, with interest. On the other hand, most of the big companies that still owe billions to taxpayers, including Fannie Mae and Freddie Mac, and auto firms GM and Chrysler would not be subject to the tax. Only two big firms, AIG and GMAC, owe the government and would pay the tax. Even in these cases, the “modest fee” won’t add anything to the government’s coffers ”” any taxes they pay would simply reduce the amount the amounts they pay back.

The plan will do nothing to help taxpayers or get bailout money returned to the Treasury. It makes for good rhetoric ”” what politician doesn’t want to sound anti-bank nowadays? ”” but is no substitute for real policy.

Obama’s Bank Tax: Missing the Target
James Gattuso
Fri, 29 Jan 2010 14:51:59 GMT

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Geithner on the Hot Seat

Wow! I could almost vote Republican after this exchange between Congressman Burgess and Treasury Secretary Geithner before the Joint Economic Committee. Since I work for a small business I would say Congressman Burgess is just touching the surface of the fear running rampant through small business owners. Surviving the next six months is scary enough. The recycled Keynesian economic policies of this administration remind us why our government has not used them for over forty years. They just don’t work!

BURGESS: What’s happening in small businesses is people are frightened to add jobs, because they don’t know what we’re going to do to them in health care. They don’t know what we’re going to do to them in financial regulation. They’re scared of what we might do with energy prices in the future with cap and trade. Small business — medium sized business is frightened at jobs right now.

I could help the president and his panel. He doesn’t need another program. We don’t need another stimulus. We need to provide some tax relief and then get the heck out of the way, and the American economy will recover as it has always done.

GEITHNER: That broad philosophy helped produce the worst financial crisis and the worst recession we’d seen in generations. We had a pretty good test of that philosophy — a pretty good test of those policies that did not serve the country well. Now…

BURGESS: Mr. Geithner, when I came here in 2003, we were in a jobless recovery. Tax relief was passed in May of 2003, and as a consequence by July of that year, we were adding jobs at a significant rate. It seems to have worked fairly well.

Geithner on the Hot Seat
John
Fri, 20 Nov 2009 01:35:33 GMT

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Why did the stimulus bill not create jobs?

 

Half of the 2009 stimulus spending is attributable to two programs: $32 billion for Medicaid, and $22 billion in payments for unemployment insurance. A one-time payment to Social Security beneficiaries added another $13 billion; spending for financial assistance to states (from the new State Stabilization Fund) added $12 billion; and other direct assistance to college students (mostly for Pell grants) added $7 billion. Together, those five programs account for almost 80 percent of stimulus spending in fiscal year 2009.

ARRA Spending for 2009 Close to CBO’s Estimate
Douglas Elmendorf
Tue, 03 Nov 2009 00:14:29 GMT

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Warner, Dunkelberg spar on leading small-business problem

I work for a small business and we are reducing our inventory further in response to the continued drought in sales. Although we do not carry any debt, I doubt any small business would be willing to increase debt with such weak sales. Increased debt would increase the risk of bankruptcy if sales do not perk up. On the other hand if government could implement policies that would encourage increased sales, that would fix a multitude of business problems. In my humble opinion Dunkelberg is the winner of this debate.

Sen. Mark R. Warner, D-Va., told CNBC’s Larry Kudlow that NFIB is not talking to small businesses in Virginia when it claims credit demand is low. NFIB Chief Economist William Dunkelberg responded saying that small-business owners across the country all say the same thing. "The top problem today is not credit … it’s no customers," Dunkelberg says. "All this nonsense we’re doing in Washington is not bringing in customers. They ought to be giving money to the taxpayers, to the citizens."

CNBC | 10/15

Warner, Dunkelberg spar on leading small-business problem
(author unknown)
Fri, 16 Oct 2009 05:00:00 GMT

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The Best Jokes about Obama and the 2016 Olympic games selection

The best jokes about the IOC selection of Rio for the 2016 Olympic games over Chicago, Tokyo, and Madrid came from Rush Limbaugh. Frankly I think the IOC made the right decision. Brazil is a rising economic star and will likely be a great representative for South America. Rio is definitely a more exciting travel destination than Chicago or Tokyo.

"Who knew the Olympic Committee was a bunch of racists?" Limbaugh joked at the start of his program, saying he was waiting on official confirmation from former president Jimmy Carter, before turning to the gravity of the nation’s embarrassment. 

"When you stop to think about it, folks, doesn’t it make sense?" Limbaugh asked.  "Our president, Barack Hussein Obama, has been running around the world for nine months telling everybody how much our country sucks…. Why would anybody award the Olympics to such a crappy place?"

Limbaugh: Obama "Failed" in Copenhagen, Unmasking Weakness and Ego – The Note

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An open letter to America

Here’s what I think one of our “dis-respectful” elderly might say to Stevie about his post,  An open letter to America, in which he says,

Dear Everyone,
Stop debating health care reform. You have no idea what you are talking about. …

Stephen, you need to calm down a bit. The sound you hear from these town hall meetings is just our legislators going through a California legislative moment. Our elderly are taking their Congressman and Congresswoman back to the wood shed for a little Bible study. Stephen, we are old but we are not senile. The TARP bill was supposed to stem the tide of foreclosures. It didn’t. The stimulus bill was supposed to stimulate the economy and stem the rate of unemployment. It didn’t. Now you are trying to ram a Health Care Reform bill through Congress and the bulk of the “savings” is going to come out of Medicare benefits for the elderly and you want us to believe that we won’t notice it! Which part of “Thou shall not lie” do you not understand?

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What we need is a fresh group of plantation owners!

In this piece, The Death of the Middle Class?, Chris Larsen tries to make the argument that the middle class is over with this statement.

Unfortunately this middle class will not recover; the patient died.

For a person who got his first real job during the Carter administration I reject Chris’s reasoning on both a personal experience level and and a pragmatic level. On a personal level I got a degree in Electrical Engineering in 1976 but my interests were in computers and networks. I could of taken a job in the power industry but I pursued jobs in the practically unknown computer industry. Today I am maintaining a web site for an internet retailer. The words "web site" and "internet retailer" did not exist when I graduated and now it is part of my resume. I do not consider myself unique since I have met a lot of people whose career path has been equally diverse. Chris is asking me to believe that the middle class can not adapt to changes in the market place when my experience shouts "Yes, we can adapt because I have done it!".

Then Chris tries to make the following argument .

If you’re part of the rich elite, you’re also much better off.

Legislators from California to Washington D.C. are saddened by the hardships facing the poor and the middle class but the problems facing the "rich elite" is a disaster of biblical proportions. When the top 1% are paying as much taxes as the bottom 95%, the one group you really do not want to get sick is the rich elite. As California voters showed us the average voter would rather cut social programs than raise taxes on the stressed middle class. If the rich elite are so well off, why did Boone Pickens cancel his massive wind farm? A few months ago Boone was confident he would proceed with or without government support.

The plain and simple fact is that the drop in tax revenues at the state and federal level shows that the rich elite got clobbered with the recession. My guess is that the rich elite are also looking at massive unreported losses in their stock portfolio and real estate. The rich do not feel very rich right now! The real tragedy is when you combine the loss of income with huge paper losses on their investments and a Democratic party that is actively pursuing increased taxes, fees, and other penalties targeted at the rich, you have an almost impossible environment to create wealth. Without the lure of wealth you will have a very diminished base of willing entrepreneurs. I do not think I know a single entrepreneur who does not dream of making lots of money. Its not the only motive for an entrepreneur but it is a very important one. Although you may find if difficult to sympathize with the plight of the rich elite, the impact on our future entrepreneurs is a more serious problem. More than ever this country needs the a group of entrepreneurs to take the chance and start working on the "next great idea". Some of these entrepreneurs will fail and lose all of their money. The successful few will create businesses that will create lots of good paying jobs and become the heroes of future businessmen and women. Eventually our admiration and gratefulness for the successful few will fade and we will see them like the plantation owners in our country’s early history.

So what should the country do? A pragmatic Democratic party should be stealing a page from the Republican playbook and embracing policies for a more enticing business climate for investment. History shows that the Reagan and Bush tax cuts when combined with reduced government spending stimulated the economy and lowered unemployment. Since the administration’s plan is widely viewed as a failure at stimulating the economy and creating jobs, it makes sense to try something that has worked in the past. The time for increasing the tax on the rich has come and gone. Redistribution of wealth is so 2007. Now is the time to entice the next of group plantation owners out of their seats and get this country working again.

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Obama Exacerbates Racial Divide

I am not sure where Mr. Gates grew up but I learned early in life you do not mess with the police. On at least two different occasions I found that treating the police with courtesy and respect helped keep two of my friends from being arrested for public intoxication. I knew that when I talked with a police officer that there was a fine line between respectful and argumentative and I was not going to cross it. From reading the police report it appears that Gates got mad and crossed the line. I am about 99% sure that if I told the officer, "I’ll speak with your mama outside", both my friend and I would be booked for disorderly conduct, public intoxication, or both. I bet there are plenty of Harvard undergraduates who are willing to lecture Mr. Gates on the foolishness of arguing with the police on such a trivial matter. It is better to be thought a fool than to open your mouth are remove all doubt.

You know, I know everybody has a different temperament  and personality.  But I remember being with my father when I’m ten years old and my brother and parents were all in the car. We were driving back home from someplace in Arkansas and it was at night and we got pulled over by state trooper. 

And I remember the way my dad dealt with the guy.  He just sirred the trooper out: "Yes, sir. Yes, sir. Yes, sir." He didn’t argue, was not belligerent. He was totally cooperative.  And whenever I’ve had any encounters like that, and there have been few, but, you know, I just don’t start yelling at people. It just doesn’t occur to me. It’s not in my makeup, especially if everything’s okay. I’m going to do what I can to prove everything’s okay and end the situation.  Let the cops get on their way and let me get back in my house or whatever. This business of Gates continuing to yell as though he had some special privilege because maybe he’s a teacher at Harvard or whatever? This whole thing is just… Especially when you learn that the cop is trained in racial profiling.  None of this makes a whole lot of sense.

Obama Exacerbates Racial Divide

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California governor signals key budget concession (Reuters)

I was wondering when some pragmatic souls in the California legislature would  step forward and give the voters what they asked for, a balanced budget with no tax or fee increases. Hopefully the legislators will present an accurate but conservative budget so that they do not have to go through this process again.

California State Senator Leland Yee (D-San Francisco) talks in his office about the state's budget impasse in San Francisco, California July 3, 2009. State officials have begun issuing billions of dollars in Reuters – Governor Arnold Schwarzenegger, optimistic California can finish its budget negotiations in a few days, is willing to reconsider his proposed cuts to education in hopes of averting a cash crisis, the San Francisco Chronicle said on Saturday.

California governor signals key budget concession (Reuters)
Sat, 04 Jul 2009 17:51:26 GMT