Fighting to Preserve Liberty in America
The New Year has begun and hopefully, we haven’t broken all our New Year’s resolutions yet. There is still a lot of talk about fairness and inequality. It is the last best hope of a message for the progressives and it is time we did take a look at fairness.
As we approach the mid-point of his term we, once again, hear President Obama with another scheme to create jobs. This time he really, really means it. For a mere $50 billion we can build roads, rails and runways and we can create an “infrastructure bank” to boot. I guess the government wants to get into the banking business now that they have swallowed up two thirds of the domestic auto companies and passed a law to take over health care. But, hey, who are you calling a socialist?
The infrastructure bank has supporters: Arnold Schwarzenegger, Ed Rendell the Democratic governor of Pennsylvania and Michal Bloomberg the Democratic, Republican, Independent mayor of New York, but they want it to support more projects such as water and clean energy projects. But here’s the really good news, according to the New York Times “They say such a bank would spur innovation by allowing a panel of experts to approve projects on merit, rather than having lawmakers simply steer transportation money back home.” We get a brand new panel of experts to tell us morons what is good for us!
How about this idea, get the Federal government out of the roads, rails and runways business. Unless the road is part of the Interstate highway system, and that means interstate, the feds should stay away from it. If a road within a city needs maintenance, that city and its citizens should pay for it, not taxpayers elsewhere in the country. That’s how the whole process got screwed up. You build my road, I’ll build your road and nobody will know who pays for what, until we find out we are $13 trillion in debt.
One of the good ideas Jimmy Carter had was to deregulate the airlines. Airlines became competitive and prices came down. The problem is that air travel consists of three components: the airlines, the airports and air traffic control. Complete the process, deregulate the airports and air traffic control. If you do that, airports can charge different prices for takeoff and landing slots. No more will we see thirty-two flights all scheduled to take off at 7:30 AM from one airport. Private investors would also have an incentive to build a state of the art air traffic control system.
By the way, what happened to all those “shovel ready” projects from the first stimulus plan? Did we actually finish building all the turtle crossings that this country needs?
On another front, Obama continues to tinker with the mortgage market rather than getting out of the way, letting housing prices find their bottom and then going from there. George Mason economist Anthony B. Sanders said in the New York Times, ““Housing needs to go back to reasonable levels. If we keep trying to stimulate the market, that’s the definition of insanity.” Even Democrats are piling on:
“The administration made a bet that a rising economy would solve the housing problem and now they are out of chips,” said Howard Glaser, a former Clinton administration housing official with close ties to policy makers in the administration. “They are deeply worried and don’t really know what to do.”
Who would have thought that a president and vice president with no executive experience prior to taking office would not know what to do once they got there? After all everyone knew that Obama was a really nice guy with an even temperament, what went wrong? Now we hear that Fannie Mae wants to back mortgages with nothing down. But not to worry, this time they are actually going to require the lenders to check to make sure the borrower has income. I feel better already.
Since this administration seems to like experts how about listening to these experts:
“We have had enough artificial support and need to let the free market do its thing,” said the housing analyst Ivy Zelman.
Michael L. Moskowitz, president of Equity Now, a direct mortgage lender that operates in New York and seven other states, also advocates letting the market fall. “Prices are still artificially high,” he said. “The government is discriminating against the renters who are able to buy at $200,000 but can’t at $250,000.”
It’s time for President Obama and his administration to get his boot off of the neck of the economy. Ours is the strongest most resilient economy in the world, if you set it free. All of the tinkering and the anti-business threats have pushed employers to the sidelines. The uncertainty over the economy has led businesses to take a wait and see attitude.
The rhetoric the Democrats have been trying to muster to save their skins is that “eight years of failed policies,” yada, yada, yada. The reality is that this recession started one year after Nancy Pelosi and Harry Reid took over Congress. This recession started in the last year of the Bush administration, not the first seven. This recession has lasted nearly twice as long and counting under Obama than it did under Bush, and it shows no sign of changing anytime soon. A recent poll in Ohio by Public Policy Polling asked respondents who they would prefer to see in the White House right now and the results were George W. Bush 50%, Barack Obama 42%; what does that tell you?
So, Mr. Obama, keeps your hands were we can see them and slowly step away from the economy.
In the August 23, 2010, New York Times, Paul Krugman decries that if we don’t let the Bush Tax cuts expire and thus have a massive tax increase in the midst of a weak Obama recovery, it will be so unfair, so evil…
First let’s look at how twisted the logic of the left has become. Mr. Krugman says, “These same politicians are eager to cut checks averaging $3 million each to the richest 120,000 people in the country.” Er, not really, Paul, unless the richest 120,000 people are stupid enough, with all their financial advisors, to have that much tax withheld from their incomes. You see, Paul, the only reason the government would have to cut them checks is if they paid too much in taxes during the year, and since the current rates are already in place it is unlikely that they would change their behavior to suddenly have an extra $3 million sent to Washington. Here’s the problem with your thinking, Paul. It is not your money, it is not my money, it is not the government’s money to begin with. It belongs to the people who have earned it. It is the people to provide revenue to the government. It is not the government who gives money to those who produce. Got it?
Like most on the left Mr. Krugman always associates tax cuts with a loss of revenue and tax increases with a gain in revenue, and ignores how people change their behavior with regard to these changes.
As this chart shows, at the end of the Clinton administration and the dot.com bubble the economy fell into recession. The Bush tax cuts were implemented in 2001 and they were across the board tax cuts, not just for the wealthy. A second set of tax cuts came in 2003. As you can see revenues started to fall before the tax cuts, but bounced back sharply after the cuts in 2001 and 2003. But Mr. Krugman would have you believe that if you cut taxes, revenues fall and if you leave them along or increase them, revenues increase. You can also see that Clinton’s tax increase in 1993, didn’t have much effect in changing the rate of revenue growth, but when the Republicans took over Congress in 1994 and instituted tax cuts in 1997 you can see the slope of the curve bend upwards and it is even steeper with the Bush tax cuts. So in the absence of the 2001 recession, revenues collected increased with tax cuts, not tax increases.
Let’s look at who is paying what share of the taxes. The follow chart shows what percentage of the tax burden was paid by what percentile of the income earners by Adjusted Gross Income.
| Year | Top 1% | Top 5% | Top 10% | Top 25% | Top 50% | Bot 50% |
| 1999 | 36.18% | 55.45% | 66.45% | 83.54% | 96.% | 4.00% |
| 2007 | 40.42% | 60.63% | 71.22% | 86.59% | 97.11% | 2.89% |
So even as the Bush tax cuts reduced tax rates across the board, the “evil” rich still ended up carrying a larger share of the overall tax burden than they did before the cuts. So just what is Mr. Krugman’s beef?
I argue that were are nearing a dangerous threshold politically, where the majority of voters may soon find they pay no taxes and the minority pays all. If that tipping point is reached, what is to prevent this majority from voting for massive tax increases that will only affect the minority? All Americans should carry some share of the cost of government. It should not be a free ride for some and a minority pays the tab.
To further emphasize the fairness issue look at the following chart from the IRS in 2004. The brown bars show the share of the income that the percentile on the vertical axis earns. The blue bar shows the share of the total income tax bill they pay.
The problem folks is spending. As the first chart makes pretty clear, we have not been suffering from a revenue problem, we have been suffering from a spending problem. This administration and their instigators, like Mr. Krugman, have been urging reckless spending upon reckless spending and even decrying that the administration has not spent nearly enough. Krugman is sloppy in making his case and tries to convince his readers that we will be carrying buckets of money to the wealthy when the truth is that he wants to open the spigot wider from those who produce in this country to the profligate government who can then spend it on more turtle crossings in Florida, and to prop up the unions, and bankrupt states. Stop spending, cut taxes, shrink the federal beast, and we will be in good shape in short order.
As many people have said, “I never got a job from a poor man.” In looking back at my own career, I have worked for several companies that were started by entrepreneurs and who became wealthy. Do I care if they were wealthy? No. Do I wish they were taxed to the eyeballs? No. If they were, those are jobs I would probably wouldn’t have had. Opportunity is what made America the country where people around the world fight to get into, not bashing the successful. All who stive to come here want to become those wealthy successful people and give the same opportunity to their children.
In today’s New York Times there is a story about Rick Lazio latching on to the Ground Zero mosque issue as his new campaign theme. The first television ads I have seen regarding his run for governor are about this issue. He is strongly opposed. Okay, but he wants us to elect him governor to do what, exactly? New York has a lot of problems, from a state government that is completely dysfunctional to being broke and since everyone seems to agree that the mosque at Ground Zero is not about the right to build there but about the propriety of building there, what does it have to do with the office of governor?
When he pinch hit for Rudy Giuliani running for the senate against Hillary Clinton, after Mr. Giuliani dropped out of the race with prostate cancer, Mr. Lazio took a similar tack. You probably remember their first debate when Mr. Lazio famously walked across the stage to a startled Mrs. Clinton and asked her to sign his pledge on campaign finance reform. She refused and that was his theme. The problem is that although many people feel our political process is corrupt, when it comes to campaign finance reform, most people don’t care about it. Those who care about it are incumbents, who want to cripple those who run against them. Some of the so called “reforms” have politicians spending so much time chasing $50 donations that they can’t do what they were elected to do. Either that or we can only run multi-millionaire candidates who can spend their own money without limits. (Simple solution: let anyone contribute any amount to any campaign at any time and just post the information on the Internet within 72 hours in a database that is fully searchable. Done.) It only took a little time for the novelty of the debate video to fade and Mr. Lazio had no campaign.
Another challenger in this year’s governor’s race, Carl Paladino, one of the aforementioned millionaires, has been hitting the airwaves more frequently and more effectively than Mr. Lazio. He is not a one trick pony. His first ads hit Andrew Cuomo on being a career politician and that he, Paladino, was a business man who knows how to create jobs. What do we desperately need now? Jobs. What are we sick of? Career politicians, like Mr. Cuomo, who played a role as HUD Secretary in the Clinton administration of feeding the real estate frenzy and the subsequent housing collapse that created the financial crisis.
On the mosque situation, agree or disagree with him but Mr. Paladino says exactly what he will do about it. He will take the property away under Eminent Domain (thanks to the activist judges on the Supreme Court who gave us Kelo v. City of New London) and use the property to create a war memorial. He doesn’t just say he will oppose it he tells us what he will do about it.
In the interest of full disclosure, I contributed to Rick Lazio’s senate run in 2000 and I have no connection with the Paladino campaign. But if Mr. Lazio is serious about defeating Andrew Cuomo for governor, he has to find some issues that not only resonate with the people of New York but that are the responsibility of the governor to address. If not, rather than split the conservative vote, he should step aside and help ride the anti-incumbent wave that Carl Paladino is surfing.
Although it is getting very tiresome and it is losing it’s bite, Democrats still are desperately clinging to “we inherited eight years of Bush policies, yada, yada, yada.” Was it eight years? If so, how did he get re-elected in 2004? I will be among the first to say that Bush wandered off the conservative reservation with his spending, but Bush didn’t create Fannie Mae and Freddie Mac either.
What Have We Inherited?
Let’s take a look at everything else we have inherited. Why stop at Bush?
“Urged on by ACORN, congressional Democrats and the Clinton administration helped push tolerance for high-risk loans through every sector of the banking system — far beyond the sort of banks originally subject to the CRA. So it was the efforts of ACORN and its Democratic allies that first spread the subprime virus from the CRA to Fannie and Freddie and thence to the entire financial system. Soon, Democratic politicians and regulators actually began to take pride in lowered credit standards as a sign of ‘fairness’ — and the contagion spread.”
Gee, all of this we inherited from the pantheon of Democratic gods. It makes Bush sound like a piker.
Will We Never Learn?
When this country was founded Congress created three departments: Department of War, the Department of State, and the Department of the Treasury. That pretty much fits what the founders intended. A limited federal government that would deal with external issues and defend us from our enemies. There are now fifteen federal cabinet level agencies. Why is it that Democrats feel this need to create massive new bureaucracies? Why don’t they ever go away when they have achieved their mission? We are now facing crushing deficits brought about by decades of government growth brought about by the Democrats.
It’s time to stop blaming Bush. Mr. Obama, you wanted this job. You won this job. Now, do this job and stop bitching about what you inherited. If anyone has something to bitch about it is we Americans, because you and your fellow travelers have built this house of cards and you think the only solution is to build it bigger, faster. If the load is too heavy to carry, we don’t need vitamins (VAT tax) to get stronger, we need to lighten the load. We have to shrink this beast down to a manageable size, NOW.
You hear a lot of talk these days about the Senate being broken because nothing can get passed with a majority vote. Everything has to get sixty votes to pass and that’s just un-American. Is it?
The House of Representatives
The Founding Fathers were brilliant in designing the government that has survived longer than any other, and it wasn’t an accident. The House of Representatives was designed to be the branch of government closest to the people. The members come from districts that are sized based on population. It is also in the House of Representatives that all revenue bills (i.e., tax increases) must originate. The Senate cannot create legislation to raise taxes.
The Senate
The Senate was designed with a different purpose in mind. In the form of federalism that they created, the Senate was supposed to represent the individual states. Originally Senators were appointed by the state legislatures and this continued until the ratification of the Seventeenth Amendment in 1913, which provided for the direct election of Senators by the people. The Senate was designed to be a check on the tyranny of the majority. In the House, populous states like New York, California, Texas and Florida, have a lot of representation. To prevent a handful of states from pushing around everyone else, representation in the Senate is the same for Rhode Island as it is for California, two each. In the House, California trumps Rhode Island. In the Senate they do not. Are you picking up the theme?
The Dreaded Filibuster
Being able to filibuster in the Senate is another way of allowing cooler heads to prevail. If legislation before the Senate cannot win over some reasonable number of Senators, then it’s probably not a very good idea for the country.
As proof that things are more partisan today, pundits point to how the number of filibusters has greatly increased over time.
In the entire 19th century, including the struggle against slavery, fewer than two dozen filibusters were mounted.
It is reported that things really took off during the Clinton administration. Hmm, what else was going on then… Hillary Care? We have also seen the out of control growth of the federal government’s involvement in almost every aspect of our lives, such as, how much we can be paid, how much a bushel of wheat should cost, how schools are funded; none of which is in the Constitution as powers the federal government should have. Those are all things that, according to the 10th Amendment, are the purview of the states or the people.
The Filibuster Fix
So if you don’t like the way the Senate is bogged down, instead of taking the brakes off the car, how about dumping the junk in the trunk? The less minutia the federal government gets involved in (let’s start with health care), the less reason, reasonable Senators will have to filibuster.
Sometimes I wonder if this is all a bad dream and I will wake up at some point, in a cold sweat, comforted in knowing that it was just that. With the enhanced interrogation techniques, aka waterboarding, that was used on exactly three very bad men, and yielded 60% of what we learned about Al Qaeda, we are now Mirandizing terrorists on the battlefield. For those who never got a sufficient dose of crime dramas on TV here is how the Miranda rights start:
“You have the right to remain silent…”
Say no more. That is all you have to know. From using a technique to compel these murderous fiends to give up information about their likeminded associates, we have moved to telling them it is their right not to say anything. Here’s my advice… steer clear of tall or government buildings.
How 9/11 Happened
This is exactly how 9/11 happened. The Clinton Administration treated terrorism as a law and order issue rather than a war on our way of life. They constructed walls between the FBI and CIA forbidding them to share information. What the CIA learned about the terrorists before 9/11 they couldn’t tell the FBI and vice versa. As a result we got blindsided.
It is interesting to note that in putting together the 9/11 Commission to investigate how it all happened and what we could do to prevent it happening again, Jamie Gorelick, the individual who constructed this barrier in her role in the Clinton White House, was added to the Commission panel when she should have been testifying before it. (Later, without any financial background she was appointed Vice Chairman of Fannie Mae, made millions during her tenure, and Fannie Mae’s actions led to the current financial debacle).
What more will the Obama Administration do to weaken our defenses?
We heard President Obama say pretty starkly that the enormous Wall Street bonuses were outrageous. While I stop short of government dictating compensation to private businesses, I do put the Wall Street clowns in the same category of the Big Three auto CEOs flying to Washington in their private jets looking for handouts. Very bad form.
The more I pondered the idea of salary caps, whether they were fair or not, whether it was government taking away another liberty, it finally hit me, that this just might work. So I now propose a salary cap, on the FEDERAL GOVERNMENT. And why not?
Who Got Us Into This Mess?
It was the housing bubble that triggered the financial debacle. What drove the housing bubble? Let’s start with Fannie and Freddie. They were created by Congress. Next came the Community Reinvestment Act that forced banks to make riskier housing loans. Next the Clinton Administration under the direction of Janet Reno, drove the banks harder to make more housing loans to people who couldn’t afford them. Then was the Federal Reserve that kept interest rates too low for too long. And right up until the end we had Barney Frank and Christopher Dodd saying all was well with Fannie and Freddie.
We have Charlie Rangel, chairman of the House Ways and Means Committee, the committee responsible for writing the tax laws, cheats on his income taxes.
Bernie Madoff runs a Ponzi scheme that bilks people out of $50 billion while a guy named Markopolis figured the whole thing out in five minutes and spent the last nine years trying to get someone in government to care.
The government imposes CAFE standards on the auto industry and drives them to the brink of bankruptcy and then says we have to bail them out.
Now they are proposing a “stimulus” package that is just a bunch of pork.
Solution
So I propose that we, their employers, cap their salaries at $100,000 (from their current $162,500) until such time as they fix this mess. I further propose that if a congressman/woman can prove that they didn’t vote for any of the crap that got us into this mess, that they be exempt from the cap.
What say you?
