I noticed some posts at the Maritime Sentry about Governor Mark Sanford. If Bobby Jindal can’t save us in 2012, then Mark Sanford is my second choice. Everybody knows that Jindal is turning down bailout funds. Here is Bobby Jindal on the Hugh Hewitt show explaining why he is refusing the bailout funds, on how he intends to deal with the economic downturn in his state budget. Dynamite!
But Maritime Sentry has the story on Mark Sanford’s refusal to take bailout funds. Here, they link to this Forbes article, entitled “Why Mark Sanford Matters: Small-government conservatives have found their champion.”
Here is an excerpt from the article:
Sanford’s opposition to President Obama’s American Recovery and Reinvestment Act, and in particular his insistence on using up to a fourth of his state’s stimulus funds to pay down debt or refusing it outright, has fast made him a folk hero to conservatives.
I am a little concerned by his opposition to the Iraq war, because I feel that it was a successful action against terrorism with strategic gains that far outweighed the costs. I approve of his small government stand, though. The National Taxpayer’s Union also approves:
The 362,000-member National Taxpayers Union (NTU) has applauded South Carolina Gov. Mark Sanford (R) and Texas Gov. Rick Perry (R) for their decisions this week to refuse part of the federal stimulus package earmarked for their respective states. Sanford will accept $700 million only if the President allows him to use it to pay down debts rather than create new spending obligations. Perry has refused outright $555 million for expansion of state unemployment benefits.
Maritime Sentry also links to this 5-minute video, in which Sanford explains why he is turning down the bailout money. He doesn’t want Obama to be able to impose taxes on his state later, if he takes the bailout money today.
The Democrats doesn’t like federalism much. The DNC is even running ads in South Carolina against Sanford for refusing to take the money, and the attached strings. I found a statement about these DNC ads over at his blog. Jindal is also taking heat from unions and other economically-illiterate left-wing groups in his state.
UPDATE 2: Here is the first part of an interview with Mark Sanford conducted by the Acton Institute, which specializes in free market capitalism and its relationship to religious liberty. (H/T Binky @ Free Canuckistan!)
Everyone who reads Thomas Sowell knows that the most important question to ask when talking about any economic proposal is “And Then What Happens?” That was the point of his one-two punch of introductory books on economics, “Basic Economics: A Citizen’s Guide to the Economy” and “Applied Economics: Thinking Beyond Stage One”. Don’t examine the intentions of the proposal. Examine the incentives it creates.
But this idea goes back even earlier to Henry Hazlitt, who wrote about it in “Economics in One Lesson”. (The link goes to a statement of the “one lesson”)
…the whole of economics can be reduced to a single lesson, and that lesson can be reduced to a single sentence:
The art of economics consists in looking not merely at the immediate but at the longer effects of any act or policy; it consists in tracing the consequences of that policy not merely for one group but for all groups.
Well, what are the long-term effects of Obama’s federal budget, for all groups?
Congressman John Boehner has a breakdown of some of the budget numbers on his blog.
The President’s budget calls for $1.4 trillion in new taxes that will affect every American. There’s a $646 billion “cap and trade” energy tax; a $636 billion tax on income and small businesses; new taxes on investors by raising capital gains and dividend rates; a resurrection of the death tax; and a reduction in charitable deductions which will result in $4 billion less in donations each year to charities across America.
But it’s worse than that. A while back, I wrote about how Obama wanted to discriminate against religious schools by denying them renovation funds. In the budget, he continues his anti-religious trend by de-funding private charities. This is the part that Christians who voted for Obama need to pay attention to, because this matters to us.
The proposed reduction in charitable deductions is especially troubling, since it would hurt charities at a time when American families are struggling and in need of assistance.
But remember, when government expands, the state becomes more secular. The capabilities and influence of private religious groups decreases as the state de-funds them and takes over their duties. Instead of people depending on their neighbors’ charity, they now depend on the state. Instead of letting workers decide where to give charity, workers are forced to fund secular government programs.
According to the Center on Philanthropy at Indiana University, total itemized contributions from the highest income households would have dropped 4.8% — or $3.87 billion — in 2006 if the Obama policy had been in place. That year, Americans gave $186.6 billion to charity, more than 40% from those in the highest tax bracket. A back of the envelope calculation by the Tax Policy Center, a left-of-center think tank, estimates the Obama plan will reduce annual giving by 2%, or some $9 billion.
Before Obama’s budget, you might have given charity to a Crisis Pregnancy Center. Now that money could be spent by the government on coerced abortions abroad. Before Obama’s budget, you might have given charity to support William Lane Craig’s web site Reasonable Faith. Now that money could be spent destroying human embryos. Elections matter.
The following is a summary of the Administration’s plans to increase taxes by $1.4 trillion over the next ten years.
Taxing Small Businesses: In 2010, the President’s budget will increase taxes on all taxpayers that earn more than $250,000. The majority of the burden for this $637 billion tax increase will be borne by small businesses that pay taxes as individuals. Small businesses create 60 to 80 percent of all new jobs in America. These new taxes will stifle job creation and economic growth in the midst of a recession.
Taxing Energy Consumers: The budget also proposes to raise taxes by $646 billion on consumers of oil, coal, and natural gas through a complicated “cap and tax” program that will increase the cost of energy for every American. These carbon-based fuels provide about 85% of all energy output in the U.S. This new tax will increase the cost of energy by up to $3,128 per household annually, taking more money out of the pockets of hard working families struggling to pay their bills each month.
Taxing Investors Part I: Under the President’s budget, taxes on capital gains and dividends would increase from 15 to 20 percent, increasing taxes on investors by $338 billion over ten years. These taxes would directly affect investors and shareholders, including many 401k holders and pension funds, most impacted by the declining stock market and would further discourage investments during a time when new investments are essential to jumpstarting our economy.
Taxing Charitable Giving: The budget also caps the value of itemized deductions at 28% for those with an income over $250,000 (married) and $200,000 (single), which will reduce charitable giving by $9 billion a year. The current economic crisis has severely damaged charitable organization’s ability to provide for people who are most affected by the recession, and the budget would leave these charities with at least a $9 billion deficit.
Taxing Death: The budget reinstates the death tax scheduled to be fully repealed in 2010. According to the Joint Committee on Taxation, the death tax has “broad economic effects” and one study has found that the death tax is responsible for lowering overall employment by 1.5 million jobs.
Taxing Investors Part II: The budget would more than double taxes on carried interest, increasing taxes up from the capital gains rate (15%) to the income tax rate (35%). Carried interest is interest gained on profits from investments and is generally used to pay investment fund managers based on the fund’s performance for investors. This tax hike is yet another attack on profit, private equities, and investments in the middle of a recession.
High taxes and big spending is not good for business, and therefore not good for job growth. I predict double-digit unemployment (around 12%) by year’s end as a result of this socialist budget.
Already, Gateway Pundit is reporting that Caterpillar has laid off 2,454 employees, with more layoffs on the way. Hot Air has video on the layoffs here: Obama saying that his bailout will reduce layoffs, and the CEO saying that the bailout will not prevent layoffs.
Found this article on Mercator Net, an Australian site that is really getting my attention with the quality and scope of their articles. This is more than just politics, it’s policy analysis. Here’s Kevin Ryan’s article on Obama’s education plan.
The plan is composed of 5 points:
He promises his administration will promote five reforms in particular: major funding for early childhood education; increased funding for and emphasis on standards and assessment; new funding to recruit, educate and reward teachers; a substantial increase in the number of the country’s charter schools and new funding for programs to expanding life-long learning with a special emphasis on all American’s having another year of education.
Obama is obviously equating more spending with better student performance, an approach that I like to analogize as throwing gasoline on a fire to put it out. The rest of the article deals with the policy implications of the 5 points. The article contains a couple of examples.
Here’s one of the examples:
Historically, it is a very modern idea that money will buy a quality education. Our current experience with funding education hardly supports such a view. Arguably the worst school system in America, the Washington DC schools spends the most dollars per pupil, US$16,650. On the other hand, Utah schools, which relative to the rest of the nation, are outstanding schools spend a third, $5,700, of what is spent in the nation’s capital.
Here’s an excerpt from the analysis of the 5 points:
Every one of the President’s five-point plan means more jobs and influence for the teachers’ union. More early childhood means more teachers and administrators, even though the effects pre-kindergarten and day care are increasingly in doubt. (Finland, whose students recently earned the highest scores in international achievement tests, doesn’t send its children to school until they are seven years old) The Obama Plan ought perhaps be called the NEA’s Full Employment Plan.
Having every America spend an additional year in a classroom sounds wonderful. It will mean a staggering increase tax dollars to fund such an increase. On the other hand, the opportunity costs for an individual student staying away from meaningful salaried work will also be huge.
The article concludes its analysis of the plan with this observation about Obama’s personal life:
As a Chicago politician and now as president, he has exercised school choice for the education of his two daughters, while, de facto, denying it to those parents without his income. The fact of the President’s stonewalling parents’ efforts to get real educational choice, plus the picture of his daughters being driven out the their tony private school, passing the orange school busses delivering Washington’s children to those failing public schools, is the unstated message of his speech.
Politico is reporting that the Democrats are spending like drunken sailors.
“In just 50 days, Congress has voted to spend about $1.2 trillion between the Stimulus and the Omnibus,” McConnell says. “To put that in perspective, that’s about $24 billion a day, or about $1 billion an hour—most of it borrowed. There’s simply no question: government spending has spun out of control.”
The math: 50 days times 24 hours equals 1,200 hours. 1,200 times 1 billion equals 1.2 trillion (a thousand billions is a trillion).
I was browsing over at the Anchoress and I found some very interesting links in her link-filled post here. She runs a blog that features a mix of Catholic-oriented reflections and a conservative perspective on the news of the day.
Here’s the part of her post that caught my attention:
Disagreements between the European Union and the US over how to combat the global recession widened on Tuesday as EU governments made clear they had little appetite for piling up more debt to fight the collapse in output and jobs.
Finance ministers from the 27-nation bloc insisted in Brussels that it was doing enough to support world demand and did not need at present to adopt another fiscal stimulus plan, as Washington is urging.
The US-European differences are casting a shadow over next month’s summit in London of leaders from the G20 group of advanced and emerging economies, an event to be attended by Barack Obama on his first visit to Europe as US president.
It’s true that France, Germany and Italy have all elected conservative leaders recently, (along with Japan, Canada, the Czech Republic and Mexico). I thought that these European socialist countries were to the left of the USA. Are we now to the left of France, Germany and Italy?
You might remember that I posted recently about former-communist Russia warning Obama about the dangers of socialism. Former-communist China also warned Obama to stimulate the economy with tax cuts, not spending. Instead, Obama raised taxes and spent trillions.
Canada, Japan and Mexico also elected conservatives governments. Why can’t we be more like them? Why do we have to embrace Obama’s unilateral, cowboy-communism? Why must Obama anger the world with unpopular economic policies that fail the “global test”? Why does Obama make the world hate us?