Free Markets, Free People
Are you wearing a cotton shirt? Undies? Neal Boortz is wondering:
Now while you’re sitting there surrounded by all that cottony comfort, I thought you might like to hear about the $20 million dollars that was spent last year by the Cotton Council International. Spent where? Spent in India, that’s where. Spent on what? Well …how about a reality show? Sounds like a good idea, doesn’t it? $20 million for an Indian reality show.
Not much right? But here’s the point. This is something repeated over and over and over again through unnecessary programs such as this using your tax dollars. Crony capitalism. The Cotton Council International needs your tax money like you need a hole in your head. They have members, let them finance the Cotton Council International. My bet is you wouldn’t see money spent like that.
Want to cut waste? Here’s a perfect example of where to begin cutting. As Boortz emphasizes:
Oh … and the $20 million? That came from YOU. It’s taxpayer money. Part of the Department of Agriculture’s Market Access Program.
Now just remember that $20 million. That $20 million represents the entire federal income tax liability of about 2000 American families. That money is money taken from these families that could have been used to pay some past-due bills, get a home out of foreclosure, pay for a family vacation, or put that new roof on the house. But those families didn’t have that money to spend. They didn’t have it because some sharp lobbyist for the Cotton Council managed to talk some political types to seize that money instead and send it to India to swath some Indian babes in brightly colored sarongs for an Indian TV reality show.
Then there’s this little beauty for you to consider.
Amtrak, the heavily government subsidized and controlled passenger rail system, sent out this email to its customers:
Yes, it says exactly what you think it says. If you join a lobbying group that works to increase Amtrak subsidies, you will get a discount. Those who don’t join the lobbying group will pay full fare (such that it is). Or as the recipient of this email says:
Whatever you think of government funding for train travel in the United States, is it problematic that a government corporation will give people discounts if they pay to join an organization that will lobby the government for more subsidies?
Put another way, Americans who pay to support more subsidies get charged less to travel on subsidized trains than those who oppose the subsidies. Two classes of citizens, based on political beliefs, when riding the train?
Apparently that’s fine.
But remember, any cuts we make in spending will lay off police, teachers and fireman. Because everything else that’s being spent right now is both critical and necessary.
Tell me if you know which Republican Congressman said this:
"President Obama and others in Washington need to realize that we cannot spend our way to prosperity and that to in order to create jobs," … "We need to address unfair trade deals that ship jobs overseas and enact policies that allow us to take advantage of our vast natural resources such as coal and natural gas in a safe and responsible manner which will lower energy costs and create jobs and approving the Keystone XL Pipeline would be a good first step."
House Speaker Boehner? Paul Ryan? Eric Cantor?
Uh, no … it wasn’t a Republican at all. It was Rep. Mark Critz, D-PA. The guy who represents most of John Murtha’s old district. Does this sound like a guy who is wanting the president anywhere near his district as he runs for re-election?
Meanwhile the President gave a “major speech” yesterday in Ohio that was 54 minutes long and could be boiled down into one sentence – No change: more spending, more taxes, same old failed economic policies and blame Bush.
President Obama’s much-anticipated speech Thursday on the economy didn’t lay out any new initiatives or make any new arguments. It often sounded like a recap of his first three years, or another version of the familiar "how we got here" blamefest.
Meanwhile, going back to part of Rep. Critz criticism, the Keystone XL pipeline, something which would mean jobs for this country and a big step toward increasing our energy security, is indeed proceeding – toward China or elsewhere:
While Joe Oliver, Canada’s minister of natural resources, said in an interview that the United States would remain Canada’s “most important customer,” billions of barrels of oil that would have been refined and used in the United States are now poised to head elsewhere. Expansion of Canada’s fast-growing oil-sands industry will be restricted by the lack of pipeline capacity before the decade’s end, he said, which “adds to the urgency of building them so that the resources will not be stranded.”
Three new pipeline network proposals — two that call for heading west and the other east — have been put forward.
If ever there were a blunder of historic proportions, Obama’s petulant and politically motivated disapproval of the pipeline rank up in the top.
The scale of this blunder, which the President made ostensibly on environmental grounds, is compounded by the fact that there is no putting the genie back in the bottle. Once a new pipeline is built, Canada has no reason to return to selling its oil products solely to the U.S. at a reduced price. The decision not to approve Keystone XL makes Solyndra look like a stroke of genius.
Oh and finally, can anyone guess what was required to attend the President’s Ohio speech?
Yeah, that’s right – a photo ID.
The indispensible e21 goes after what it calls “the government sector of the economy canard”.
A recurring theme of commentary appearing in the New York Times and elsewhere is that the government is shrinking as a share of the economy. According to Floyd Norris, “the government sector of the American economy has shrunk during the first three years of a presidential administration” for the first time since the 1960s. This dangerous decline in government spending is thought by Norris and others to be responsible for the slow growth since the recovery officially began in July 2009.
The most straightforward way to assess the burden of government is by comparing total government outlays to gross domestic product (GDP). By this standard, the federal government is currently larger than at any point in post-War history. Between fiscal years 2009 and 2012, federal outlays averaged 24.4% of GDP, the highest government-to-GDP ratio since 1946 and 22% (4.4 percentage points) larger than the average size of government since the military demobilization following World War II of 20.0%.
The politics of the Norris approach is to make the canard seem to be reality in an attempt to portray the last three years as a conservative approach to our economic problems by the Obama administration:
Rather than measure actual government spending, which is at record levels, Norris instead focuses on the “government sector of the economy,” which is different conceptually from the actual size of government. Each dollar of government spending does not automatically contribute to GDP. The Bureau of Economic Analysis (BEA) only counts direct government purchases of goods and services or investments in capital equipment or infrastructure in the National Income and Product Accounts (NIPA). When the government buys an airplane from Boeing, for example, it counts the same in the GDP as if the aircraft were purchased by United Airlines. The same accounting generally works for employee salaries, as government purchases of services provided by Commerce Department employees, for example, count as government consumption spending in GDP.
The difference between government spending and the government contribution to GDP is largely attributable to transfer payments, entitlements, and subsidies. In recent years, transfer payments have exploded upwards. As of March 2012, transfer payments were running at a $2.3 trillion annualized rate, or 15.2% of GDP. Over the past four years, transfer payments have grown at a compound annualized rate of 9.1%, or about 3.5-times faster than the economy. Since passage of the Obama Administration stimulus, transfer payments have accounted for more than 18% of household income. As the composition of government spending has shifted away from capital investments and towards transfers, the “government sector” of the economy has fallen even as government spending has reached record highs.
e21 then does a further analysis of the Norris claims and says while it would be easy to dismiss the Norris critique out of hand, it does have some resonance.
Norris’ talk of the decline in the “government sector” provides insight into the changing role of government – specifically as provider of infrastructure to one of enabling transfer payments:
As e21 explained previously, the growth in state and local government has come with no corresponding increase in public goods like infrastructure to show for it.
Not all spending cuts are the same:
Spending cuts for sequestration aimed at defense, for example, will reduce GDP on a dollar-for-dollar basis. Spending cuts on transfer payments and subsidies only reduce GDP to the extent that the dollar would have been spent or not otherwise earned. A dollar devoted to unemployment insurance that lengthens the duration of unemployment, for example, may actually reduce GDP.
Finally, given those explanations, why did the stimulus bomb?
President Obama’s stimulus was very poorly constructed. In 2009, Republicans criticized the stimulus as a “spending bill.” The President responded that increased government spending was the “whole point” of a stimulus. But based on the analysis of Norris and other commentators, the spending increase was obviously too oriented towards transfers instead of real purchases of goods and services. An effective stimulus based on government spending would have looked like the plan advocated by Martin Feldstein, which would have increased government purchases of military equipment and hardware. While left-leaning economists often lament the size of the President’s stimulus (i.e. wishing that it was even bigger), the composition or relative share of the type of spending was likely a much bigger problem.
It gives further credence to the assertion than economically, Mr. Obama is out of his element. He and Krugman (and most of the left) talk about the size of the stimulus. In fact, what it is spent on is more important than the size.
Meanwhile we’re headed into sequestration where precisely what would help the GDP on the government size of the ledger is on the chopping block (military equipment spending, etc.).
Couple that with "taxmageddon” and you can imagine the economic carnage possible in January.
One of the more persistent memes coming out of Wisconsin is the Democrats were badly outspent by the Republicans in the Wisconsin recall elections. Various ratios of 6, 7 or 8 to 1 have been tossed around.
But is that the case?
Altogether, at least $77.1 million surged into Wisconsin campaigns and political groups between Jan. 1, 2011 — two days before Walker took office — and April 23 of this year, according to campaign finance statements filed with the state Government Accountability Board.
The period covers the first 16 months of Walker’s tenure, including his controversial measure to effectively eliminate public sector collective bargaining, which turned the state into a national battleground and sparked 15 recall elections.
The bulk of that money — $71.9 million — was split about in half between Democratic candidates and affiliated organizations, and Republican candidates and their affiliated groups.
What some of those tossing around the ratios mentioned will do when pinned down about their numbers is then claim the ratio represents the amount spent by the Walker campaign as opposed to Tom Barrett’s campaign. Barrett, of course, entered the race at a fairly late date (primary), so certainly Walker, who had been under the recall gun for a while, had obviously raised and probably spent much more than Barrett was able to do.
But is that a fair point? Not really.
Katherine Cramer Walsh, a UW-Madison associate professor of political science, said the relative parity in fundraising was surprising, especially in light of a provision in state law that allows the targets of a recall to raise unlimited money between the time a recall drive is initiated and the time an election is called. That provision helped Walker raise millions more than he could otherwise. Through April, his campaign had raised at least $22.8 million, smothering his Democratic rivals.
“The perception out there is that the Republicans are much more flush with cash, and that isn’t supported here,” Cramer Walsh said.
Why? Because the vast majority of the money on the left went to other organizations instead of candidates and was spent during the entire time of the recall by these organizations, just as Walker was forced to do:
The State Journal’s analysis found that at least $35 million went to the Democratic Party of Wisconsin, Democratic candidates in recall elections and union groups including the AFL-CIO, the American Federation of State, County and Municipal Employees, the Service Employees International Union, Wisconsin Education Association Council and others.
On the right:
On the other side, at least $36.9 million flowed into the Walker campaign, the Republican Party of Wisconsin, pro-Walker groups and GOP officeholders tagged for recall, the analysis showed.
In the real world, that’s pretty much dead even on the money side of things (about $5.2 million in contributions went to third parties.)
Regardless though, it is soothing to the leftist ego to believe that their righteous cause was smothered by massive spending by the other side. It fits their ideology to a tee. So expect it to continue to be the excuse du jure coming out of Wisconsin and the main reason they will dismiss the results as a portent of national disaster and blame “outside corporate money” for all the evils in the world.
Frankly I hope they do continue to believe that to be true. It reminds me of their eternal belief that there’s nothing wrong with their message, it’s just the packaging and delivery that are faulty. Let’s add “massively outspent” to the false litany of woe for the left.
If this is any indication of how France’s new president elect, Francois Hollande, plans to govern, I pity the French as well as the rest of Europe:
The 57-year-old Socialist has openly admitted that he “does not like the rich” and declared that “my real enemy is the world of finance”. This means taxing the wealthy by up to 75 per cent, curtailing the activities of Paris as a centre for financial dealing, and ploughing millions into creating more civil service jobs.
Add an explicit threat to renegotiate the euro pact to replace austerity with “growth-creating” spending, and you have one of the most vehemently left-wing programmes in recent history.
Of course reading through that helps one understand why, after learning of his victory, President Obama immediately invited him to the White House. Let’s see, tax the rich, go after the financial sector, grow government jobs and borrow, borrow, borrow to spend, spend, spend.
Huh … sounds familiar.
Mark Twain said, “A lie can travel halfway around the world while the truth is putting on its shoes.” And of course, politicians know that. So some of them use that truism to push a lie that will help them hoping that when, if ever, the truth is told, it will be moot. It is all about establishing a narrative and making it last long enough to benefit them.
The internet has made that ploy a lot more difficult. But that doesn’t mean the they don’t continue to try. Glenn Kessler at the Washington Post awards Obama’s latest falsehood their highest, or lowest depending on how you look at it, rating – four Pinocchio’s. Kessler describes that rating with a single word: “Whoppers”.
The lies have to do with decrepit bridges and, of course, Republicans. The great healer, the man who promised to change the way politics was practiced in Washington, falsely attacked his opposition – again:
“I sent them a jobs bill that would have put hundreds of thousands of construction workers back to work repairing our roads, our bridges, schools, transit systems, along with saving the jobs of cops and teachers and firefighters, creating a new tax cut for businesses. They said no. I went to the Speaker’s hometown, stood under a bridge that was crumbling. Everybody acknowledges it needs to be rebuilt. Maybe he doesn’t drive anymore. Maybe he doesn’t notice how messed up it was. They still said no. There are bridges between Kentucky and Ohio where some of the key Republican leadership come from, where folks are having to do detours an extra hour, hour-and-a-half drive every day on their commute because these bridges don’t work. They still said no.”
–President Obama, remarks to the Building and Construction Trades Department conference, April 30, 2012
You have to love the little veiled bits of populism he pitches in there – “maybe he doesn’t drive anymore”, as if Obama does.
The point, however, is every bit of that is baloney per Kessler:
Back in September, when President Obama first unveiled his jobs bill, we gave him Three Pinocchios for remarks he made regarding the aging Brent Spence Bridge on the Ohio River. The bridge connects Kentucky and Ohio, the home states of House Speaker John A. Boehner (R-Ohio) and Senate Minority Leader Mitch McConnell (R-Ky.), and it was irresistible symbolism for the White House.
The crumbling infrastructure of the nation’s bridges is certainly an important issue, but symbolism can only go so far. The administration could never explain what, if anything, the jobs bill would do to improve the Brent Spence Bridge, especially since construction was not slated to start until 2015 — and Obama’s jobs bill would spend most of its money in its first year.
Moreover, there is a long history of bipartisan support for this project, but Obama framed it as if the Republicans were blocking its reconstruction with their opposition to his legislation.
When we heard the president’s words Monday, we feared he was slipping back into his old habits. Once again he framed it as GOP opposition to fixing the Brent Spence Bridge. But then he upped the ante by mentioning other bridges “between Kentucky and Ohio” that “don’t work.” So what’s he talking about?
Of course the three Pinocchios awarded then didn’t slow him down a bit, did it. I’ve always been careful when I use the word “lie” or “liar”, because of the propensity today for people to call mistakes and the like lies. A lie is a knowing falsehood. So, after having this “mistake" pointed out previously (and don’t ever think the White House didn’t see that previous rating), Obama doubles down and throws it out there again. That, my friends, makes it a lie.
When the administration was confronted with the facts of the case, the usual prevarication began:
An administration official said the president was referring to the Sherman Milton Bridge, which actually connects Indiana and Kentucky, near Louisville. Back in September, Indiana Gov. Mitch Daniels (R) had to shut down the bridge because a 2 ½ inch crack had been discovered.
The bridge carries Interstate 64, so the bridge’s closure forced drivers to make major changes in their driving routes. Shortly after the shutdown, a Transportation Department blog declared that this bridge was “another example of why this [the president’s jobs bill] is so crucial.”
But here’s the rub: While Obama claimed “these bridges don’t work,” the Sherman Milton Bridge has already been repaired, ahead of schedule, and motorists are driving over it again.
But again, the claim is found to be baseless.
It turned out that, rather than being an example of an aging bridge, the crack that had been discovered actually had been there ever since the bridge was constructed in 1962, because of the type of steel used at the time. Other repairs were ordered, and the bridge reopened nearly three months ago — without needing any of Obama’s jobs-bill funds.
Another nearby bridge, the Kennedy Bridge, will soon undergo redecking, but officials said the work will not lead to a shutdown. Again, the work is being done without Obama’s jobs-bill money.
The facts don’t at all support the President’s statement. So what was the purpose of the lie? To cast political opponents in an unfavorable light – the usual purpose of deliberate political lies. And these were deliberate political lies.
Of course you’d think, confronted with the facts, the administration might back down a bit? But instead they apparently thought that doubling down was the best way to go:
“The President was making a point about the need to rebuild our infrastructure and the job creation opportunities that come with that, and was pointing to Ohio River area projects to illustrate the point that these kinds of projects are right in the Congressional Republican leadership’s backyards,” the administration official said.
Yup. And they were being handled by a bi-partisan state level coalition without a dollar of Obama’s “jobs-bill funds”.
Kinda stings, doesn’t it Mr. Obama?
Well done, Mr. President. A record that may be tied but never bested.
I sometimes wonder what world the editorial board of the New York Times calls home. It certainly isn’t the one the rest of us live in. But I guess it is necessary to live in an alternative world to be able to push narratives like it pushes in an editorial today. The NY Times has decided, to use a poker term, to go “all in” on Obama’s “right-wing extremism” and “dishonesty” meme.
Referencing the Obama speech yesterday, the editorial board says:
Mr. Obama provided a powerful signal on Tuesday that he intends to make this election about the Republican Party’s failure to confront, what he called, “the defining issue of our time”: restoring a sense of economic security while giving everyone a fair shot, rather than enabling only a shrinking number of people to do exceedingly well. His remarks promise a tough-minded campaign that will call extremism and dishonesty by name.
Remember Obama, who’s answer to the “defining issue of our time”, submitted each of the two years (I’m talking about his budgets) has gone a collective 0-511. That’s right, the two budgets he’s submitted to address the “defining issue of our time” hasn’t garnered a single vote in two years.
Why? Primarily because neither of the budgets convinced a single legislator of either party, to include the President’s own, that they addressed that issue at all.
Yet he presumes to lecture the GOP on the failure to confront this issue? And the NYT somehow manages to buy into that nonsense?
The GOP budget at least passed the House. The NYT presumes that no negotiations are possible because, again, it buys into the Obama claim that the GOP won’t compromise. Nonsense. Compromise doesn’t mean wholesale capitulation. In an negotiation or compromise there are lines drawn over which the two parties won’t give in. Each side has them. The NYT and Obama, naturally, want to characterize the lack of movement as GOP intransigence. But the Democrats are equally intransigent. They want more money in taxes. The GOP continues to point out that taxes aren’t the problem. The problem is spending.
Says the NYT:
Mr. Obama has, in recent months, urged Republicans to put aside their destructive agenda. But, in this speech, he finally conceded that the party has demonstrated no interest in the values of compromise and realism. Even Ronald Reagan, who raised taxes in multiple budget deals, “could not get through a Republican primary today,” Mr. Obama said. While Democrats have repeatedly shown a willingness to cut entitlements and have agreed to trillions in domestic spending cuts, he said, Republicans won’t agree to any tax increases and, in fact, want to shower the rich with even more tax cuts.
Ronald Regan agreed to raising taxes in return for what from the Democrats?
Spending cuts. In fact as I recall, his deal was 1 1/2 to 2 times the spending cuts to the tax increases. Guess what never happened?
That’s right – spending cuts.
So call it a lesson learned. What the GOP is pointing out that until the spending cuts are implemented and take effect, there is no reason to discuss revenue increases.
That’s a common sense approach that best safeguards the citizenry’s money and is based on a history that says the Democrats don’t keep their word about spending cuts.
I don’t blame the GOP for refusing to compromise on taxes.
Finally, and I’ve flipped the paragraph order in the editorial, consider the NYT lede:
President Obama’s fruitless three-year search for compromise with the Republicans ended in a thunderclap of a speech on Tuesday, as he denounced the party and its presidential candidates for cruelty and extremism. He accused his opponents of imposing on the country a “radical vision” that “is antithetical to our entire history as a land of opportunity.”
There has been no search for compromise with President “I won”. None. And it is amazing to see smaller and less intrusive government being characterized as a “radical vision” that is “antithetical to our entire history”. It is the basis of our entire history up until the welfare state came into being.
“The land of opportunity” was such because of a lack of government interference, not because of it. Obama and the left continue to attempt to rewrite history in a manner in which they redefine the words and key phrases that characterized our nation differently than they’d like prior to the institution of the welfare state.
The radical vision is that which Obama, the NYT and the Democrats continue to push, not the GOP. They don’t seem to understand that the majority of the American people have come to understand that we just can’t afford their radical vision and that government control of more and more of our lives is not a “good thing”.
If there is anyone out of touch with the American people it is Mr. 0-511. He hasn’t a clue.
And neither does the New York Times editorial board.
UPDATE: A further thought sparked by a comment by The Shark. If compromise is what Obama and the Democrats really want, they’ve had two opportunities to actually force that or at least make the argument they attempted it. For two years the GOP House has passed a budget. The way the Congress works is the Senate then passes its version of the budget and the two houses of Congress get together and hash out the differences (known commonly as “compromise).
Except the Democratically controlled Senate hasn’t passed a budget in over 1000 days. So who isn’t interested in compromise, Mr. President? And why aren’t you exerting a little leadership and confronting the Senate about its dereliction of duty? If “compromise” is so all fired important to you, why are you neglecting the easiest way of forcing it?
Bruce Bartlett takes a look at Britain’s experience and a study that documents it and concludes the same is probably true for here:
The study concluded that the behavioral effect of raising the top rate was much more powerful than anticipated. Two factors in particular had a large effect on revenues.
There was a timing effect. People moved income that they anticipated receiving forward so it would be taxed before the new higher rate took effect. They also postponed the receipt of income into the future in anticipation of a change in the tax rate after the election of a new government.
Also, because the British top rate had increased above that in all other major countries except Japan, many Britons relocated in reaction. For example, 1,379 people in high-income occupations moved to Switzerland in 2010, a 29 percent increase over the previous year.
The point, of course, is those who fall in the bracket in which the tax is increased are going to do what is necessary to minimize the impact of that tax.
Human nature 101. Consequently, the revenue projections are almost always high – and wrong.
Additionally, the Democrats like to imply that taxing the rich is a panacea for the spending problems we have. In the name of “fairness” they imply that if the rich would only pay their “fair share” well everything would be hunky dory. Of course we know the real problem is spending not revenue. But regardless, the real effect of the “Buffet Rule” for instance, is negligible:
But a March 20 analysis from Congress’s Joint Committee on Taxation estimates that implementation of the so-called Buffett rule, which would require those making $1 million or more a year to pay an effective federal income tax rate of at least 30 percent, would raise only $46.7 billion over the next 10 years. That’s a drop in the bucket compared with the $41.2 trillion in federal revenues expected to be collected under current law.
Note that last number and remember, this is a government which is claiming that it can’t get by on $41.2 TRILLION over 10 years.
Where again is the problem?
In case all this contraception talk has distracted you (as it surely was intended to do), you need to know that the deficit continues to grow and is on pace to go over a trillion dollars for the 4th year in a row:
The federal government set a new monthly record deficit of $232 billion in February and has notched a total of $581 billion in the first five months of the fiscal year, according to the Treasury Department’s official count released Monday.
February’s record is $8 billion more than the previous monthly record, set in February 2011, and came chiefly because of a drop in individual income tax receipts.
The overall deficit remains on pace to top $1 trillion this year for the fourth year in a row — but is down slightly from its pace last year …
Sorry to intrude with such boring reality.
Now back to “slutgate”.