A recent guest article in the Orlando Sentinel by Charles O. Kroncke and William L. Holahan maintains that we should not raise taxes or decrease spending while the unemployment rate is still too high. It would be nice if we could just wave our magic wands, have the government spend money created from the ether and reap the benefits into perpetuity. Unfortunately, reality eventually happens. It is certainly true that economic orthodoxy over the last many decades would agree that you do not raise taxes or decrease spending in a recession. But I thought we were no longer in recession? Hmmmm…. Okay so you don’t do those things if GDP is growing less than 3% or pick another number. Then how do we ever reduce the deficit and the debt? Continue reading ‘Jobs Now, Spending Cuts Later Say Economists’ »
Mike Riggs wrote an article for reason purporting to show that Florida’s new drug testing requirement for welfare benefits was not cost effective because the costs of paying for the test exceed the savings from benefits not paid out. I am a fan of reason, but this article simply misses the mark badly. It would be one thing to write on a simple principle that depriving somebody of access to tax revenues based upon drug screenings is a violation of their civil liberties, but to claim that the cost benefit analysis shows the inefficacy of the rule requires a thorough review of significant data. Instead this articles concludes that because only 2 families out of 40 have failed the test that the cost of paying for the passed tests is unjustified to save the small cost of the benefits denied. This is an absurd conclusion based upon a sample size of 40 taken immediately after the new policy is put into place. Continue reading ‘Reason, You Can Do Better’ »
Having just witnessed a drawn out battle over raising the debt ceiling, are we going to be treated to a reprise in short order when the new federal fiscal year begins on October 1? At least some commentators have suggested that this is a real possibility. Some liberals appear terrified that the Tea Party Republicans will use every opportunity to threaten a shutdown in order to extract more compromise and spending cuts from the President and Senate Democrats. We should be so lucky. As we all know now, the debt ceiling deal that was supposedly so catastrophic actually cuts almost nothing immediately and is very unlikely to produce real cuts in the future as future Congresses are not bound by the deal. The only concrete thing that was accomplished by approving the rise in the debt ceiling is that the national debt is going up some $2.4 trillion, the largest ever increase. So, spending is not being cut, the debt is increasing, but taxes were not raised. Not exactly a home run by the Republicans. Continue reading ‘Next Budget Battle Sooner Than Later?’ »
If you work or have any interest in Standard and Poors or The McGraw-Hill Companies, Inc., beware. In the wake of the S&P downgrade of United States sovereign debt you can expect some severe consequences for stating the obvious. Hysterical threats from the general public and questions about how you can be trusted after missing the blowups in 2008 are trivial in comparison to what the agents of government could soon be doing. The first things that come to mind are that some attorneys general may now be motivated to file suits against you for negligence, conspiracy and RICO for your role in the collapse of our financial institutions in 2008. Then there are calls for new regulation of ratings agencies from sources as lofty as the International Monetary Fund; well they funded the research at least. Lets not forget that the government itself grants the franchise rights to be a ratings agency in the first place. Continue reading ‘Warning to S&P’ »
The joint worksession with SCPS, the County Commission and many of the mayors and city council members of Seminole County was quite interesting. It appears that the school board is focusing at this point on a millage raise at this point because the revenues from the property levy can be applied to operating expenditures rather than limited to capital expenditures like the sales tax. I did not hear any voices from the School Board in opposition to the millage increase. In fact, just as suggested by Mayor Triplett, it seemed as though we were there to be told what the School Board was going to do rather than heare options and consider input. Continue reading ‘Seminole County School Board to Raise Taxes’ »
So we are giving away billions in subsidies to Big Oil, according to The New York Times; upwards of $4 billion a year according to this article. I am only picking on this particular article as it seems to echo the assertions being thrown around in our current political discussion. So let’s review the points made in that article.
First a point of emphatic agreement: there is absolutely no reason to favor oil companies over any others or to subsidize any business at all. Apparently the Times agrees as to oil companies, but not in principle. It is only the subsidies to Big Oil that need to stop and mostly because they make too much money and are not environmentally friendly. The real reason to oppose subsidies as a matter of course is that government should not be in the business of running businesses. The marketplace should pick and chose winners and losers in the free economy, not Congress by grant of government license to make money. This type of central planning of economies does not work and should be discouraged in all circumstances and for all types of businesses, whether they are popular or not. Continue reading ‘Subsidies For Big Oil’ »
Even though the Florida Legislature is struggling with budget problems and deficits, the corporate welfare keeps flowing. A few people will remember that Darden Restaurants was given millions of dollars to fund a new corporate headquarters in the Orlando area. This was not an incentive to steal the headquarters from another state or even another part of Florida. It was a payoff to prevent Darden from considering a move away from Orlando. As previously discussed, this is a horrible precedent in that we are now not only paying tax dollars to attract certain businesses but also to retain them. It would be far more simple just to grant these companies tax immunity rather than play this charade where they are incentivized to invest or create jobs and then later incentivized to prevent the loss of jobs if they should leave. Now, to add insult to injury, since the economic downturn has not allowed Darden to realize the full value of its tax exemption graft, it is seeking to capture that “benefit” even though it has not qualified under the original terms of the agreement. Continue reading ‘Corporate Welfare in Lean Times’ »
I am sick of hearing the Democrat Party talking points about the debt repeated as if they rebut the need to reduce spending. You have heard them; they usually go something along the lines that President Reagan tripled the national debt, President Clinton produced a surplus, and President George W. Bush nearly doubled the national debt. The further conclusion suggested by those citing these theses is that President Obama is suffering from the bad Republican tax policies and is therefore not responsible for the current budget deficits. Continue reading ‘Democrats Claim Fiscal Responsibility’ »
Today we “learned” from credit ratings firms that our national credit is threatened by our debt, deficits, and inability of Washington DC to make any meaningful reductions in the annual deficits. This is hardly surprising since the Democrats have been perfectly frank about their desire to raise taxes on the rich to fund grand new entitlement programs, despite the fact that there are not enough rich people to tax to make up for the existing deficits, let alone new programs. On the Republican front, even the supposedly bold “Ryan Plan” does not proposed to make any serious reductions in spending and does not purport to balance the budget for about 40 years. Neither approach is serious, but we are nonetheless informed by our intrepid tax dodging Treasury Secretary that the parties are in agreement that serious reductions in the deficits must be achieved. We were just treated to the political theater of a potential government shutdown and supposedly “draconian” cuts over less than 1% of this years budget and we are supposed to believe that a new-found agreement on the necessity of action will lead to real reductions in deficits? I don’t think so. Continue reading ‘Home Mortgage Deduction Tax Loophole’ »
We are all aware that driving is, as most things are, an inherently dangerous undertaking. Every year in the United States tens of thousands die in traffic accidents and many more are seriously injured. Regardless of the cause, those accidents are devastating personal tragedies to all involved. Because we all recognize the harm and sympathize with the effects, we are easily tempted to try to come up with solutions to prevent the harm from occurring in the first place. Many of these proposed solutions have evolved into legislation designed to make everybody safer, e.g. speed limits, helmet laws, seatbelt laws, etc. Despite all of the efforts made to date, people still die in traffic accidents, and always will. One thing that many people tend to forget is that passing legislation merely puts words on paper; action is required to give those words any effect at all and, since we are talking about government, we are ultimately talking about using force upon the people to implement the legislative enactments. Continue reading ‘No Refusal DUI Checkpoints?’ »
