Here's Another Prediction I Hope Is Wrong

Greetings from the Left Coast!

Last week, I heard Arthur Laffer interviewed on a national radio program. Laffer is a pretty bright guy who, by the way, supported President Bill Clinton in 1992 and 1996 because of Clinton's conservative fiscal policies. He's the guy who reportedly drew the "Laffer Curve" on the back of a cocktail napkin during a 1974 meeting with Dick Cheney and Donald Rumsfeld. The Laffer Curve basically states that at a 0% tax rate, and at a 100% tax rate, tax revenues would be zero. Therefore, somewhere between those two extremes is a point where tax revenues are maximized. Therefore, raising tax rates beyond that point will actually reduce revenues, and if rates are beyond that point, lowering them will actually increase revenues.

This absolutely worked during the Reagan administration, despite what you may have been told. Every time in modern history that federal taxes have been reduced, federal tax revenue has actually increased. The problem is that Congress is congenitally unable to stop itself from spending more money than it has - so even though tax revenue went up, spending went up even more, and debt increased. But I digress.

Back in June, Laffer wrote a column in the Wall Street Journal predicting what would happen if the "Bush Tax Cuts" were allowed to expire. This is now almost certain to happen, for reasons I'll explain later. Here are the salient points of Laffer's column:

• If people believe that taxes are going to be higher next year, they will attempt to shift production and income into this year if possible. This was demonstrated in the early 1990s when "high income taxpayers" shifted income into 1992 to avoid the expected increase in the top tax rate in 1993, then again at the end of 1993 to avoid the increase in Medicare taxes that went into effect in 1994.
• It is entirely likely that at least part of the reason that the economy is looking as good as it is in 2010 is because that's already happening.
• "When we pass the tax boundary of Jan. 1, 2011, my best guess is that the train goes off the tracks and we get our worst nightmare of a severe 'double dip' recession."

Laffer's estimate is that if the Bush tax cuts expire, Americans will see an average 3% tax increase. If you take away an additional 3% of people's disposable income through added taxation, it's logical to conclude that spending will drop by at least that 3%. Since the economy is currently growing at less than a 3% annual rate, if spending drops by 3% next year, we're back in recession - and that doesn't even take into account the effect the higher tax rates will have on investment and job growth.

The Democrats already chose to kick the ball down the road, and recess for their last-ditch campaign efforts without passing a tax cut extension. It probably won't get any better when they reconvene after the election, either, and here's why.

Even if the Republicans do see a sweeping victory on election day, they won't take office until next year. So the "lame duck" Congress that reconvenes after the election will be the same Congress that we have today. And here's what the math looks like. Nancy Pelosi already has in her hands a letter from 31 Democrats saying that the tax cuts should be extended for all Americans. So, although Pelosi is committed to extending the tax cuts only for the middle class, and allowing the "tax cuts for the rich" to expire, she may not have the votes to pass such a bill. So here is Laffer's prediction of what she'll do:

House rules allow her to bring a bill to the floor under "suspension" of debate, meaning that an immediate up or down vote must be held on the bill, without any debate taking place. However, such a bill requires a 2/3 majority for passage, which the Speaker does not have. So she will bring to the floor, under "suspension," a bill that extends the tax cuts only for the middle class, knowing she doesn't have the votes to pass it. Then, when it fails to pass, she will immediately blame the Republicans for voting against tax relief for the middle class. And if the economy does go off the rails next year, as Laffer predicts, she will blame the Republicans for that, too.

You see, for the Democrat leadership, it's all about their power. They were perfectly willing to see America lose the war in Iraq and come home in disgrace, as long as they could blame the Republicans for it. (Remember Harry Reid's "This war is lost?" And Obama's comment after he took office and saw that the surge was clearly working that, even knowing what he knew now, he would still have opposed it?) And they're perfectly willing to see the economy go off the rails, no matter how many Americans are hurt, as long as they can blame Republicans for it.

Thanks for listening.

Liberal Myth Number...Oh, Heck, I Lost Count...

Greetings from the Left Coast!

One of the many liberal talking points that just won't die is how our economic problems and ballooning deficit are due to all the spending on those "illegal" wars in Iraq and Afghanistan. I recently had the following comment exchange with one of my Liberal Facebook Friends ("LFF"):

ME: (...Facebook status update grumping about references to the "cost" of tax cuts, as though our tax money was something the government is entitled to, and it's some kind of sacrifice for them to take less of it...)

LFF: "I think they want the top 2% to start paying their part so we can get out of debt or something like that."

ME: "I think if you run the numbers, you'll find that you could tax the top 2% at a 100% tax rate and we still couldn't get out of debt at the current level of spending. But that's another issue - I was objecting to the use of the word 'cost' in the context of a tax cut."

LFF: "Good point.... Sadly. I hate to think how long it will take to pay off these wars and all the bailouts. None of which have done any good for the [people] of America."

ME: "According to the Congressional Research Service, the cumulative cost of the War On Terror, from 9/11 through the FY2010 defense appropriation, is approximately $1 Trillion. That includes all of the costs of the Iraq and Afghanistan operations. This year's budget deficit alone is more than that. So it ain't the wars that are causing all the budget problems. (See http://www.fas.org/sgp/crs/natsec/RL33110.pdf)"

LFF: ...(recap of how government debt grew from 2000 - 2007...) "Increased spending was needed last year to boost the economy out of recession. There are plenty facts to support that this is working. To ensure the economy did not falter, spending has continued this year. So by 2011, deficit spending should be reduced. The most recent budget forecast from the Office of Management and Budget (OMB) showed the budget deficit at $1.3 trillion in FY 2011, more than the $1.17 trillion deficit for FY 2010, but down from the $1.7 trillion deficit for FY 2009."

LFF: "By the way… Babyboomers paid extra into Social Security to ensure there would be enough funds to support our retirement. Well it’s all gone and do you know what it was spent on? Yep. the stupid, winless wars all about greed."(...more stuff on the Social Security mess...)

ME: "I think you're making my point for me. The single-year budget deficits in FY2009, FY2010, and projected deficit for 2011, are all greater than the total amount spent on Iraq and Afghanistan in the last nine years. The War On Terror represents only a small part of the spending problem."

LFF: (Silence)

Now you, gentle reader, have no doubt spotted a number of other points in LFF's comments that could have been challenged:

• Reference to the top 2% "paying their part." For the love of God, the top 1% of income earners already pay nearly 40% of all income taxes collected, and the top 5% pay over 50%, while 47% of households pay no income tax at all. How much do they have to pay before they're "paying their part?"
• The comment that none of the wars and bailouts have done any good. I'm tempted to agree on the bailouts, but the wars haven't done any good for the people of America? That comment alone is worth several blog posts.
• The comment that increased spending was needed last year to boost us out of recession. Really? Can I see a show of hands of all of you who feel boosted out of the recession?
• There are plenty of facts to support that this is working? Care to share any of them?
• By 2011, deficit spending should be reduced. Yes, I believe it will be, but only because so many Democrats are going to be kicked out of office in November.
• The "stupid winless wars" were all about greed. That's odd, because I thought they were all about terrorist attacks on American soil that killed thousands of our fellow citizens.

And that, gentle reader, illustrates one of the biggest challenges of talking to your liberal friends: it's difficult to stick to one subject, because so many fallacies get dumped on you so quickly that your first reaction is to just walk away shaking your head and wondering what universe they've been living in for the last several years. Be patient with them, and try to stick with whatever the original point was without getting sidetracked. If that doesn't work, you can always walk away shaking your head.

Thanks for listening.

And They Call Themselves Christians...

Greetings from the Left Coast!

I have several Facebook Friends who are, shall we say, quite a ways to the left side of the political spectrum. Wonderful people otherwise, but definitely part of the group for which the Left Coast is named. On several occasions, I've seen conservative political views criticized as lacking basic human compassion, and heard some variation of, "And they call themselves Christians? What must Jesus be thinking now?" This has always bothered me at a visceral level, but it took me a while to figure out exactly why:

Jesus taught that we should care for the needy personally. He never taught that we should turn that job over to government and let government do it for us. I believe there are two good reasons why personal involvement is better than government involvement.

First, Jesus never taught that anyone should be forced to care for the needy. There is no spiritual benefit in doing the right thing because you are forced to do it. That, in fact, is the essence of the doctrine of human "agency" - that we are free to choose to do what God asks of us, or not to do so. But when the government forcibly takes money from someone (which, after all, is what taxation fundamentally amounts to), even for the best of causes, that person's agency had nothing to do with it. Left to his or her own devices, that person might or might not have chosen to give to the cause in question...but it's a moot point. That person won't get the opportunity to make that moral judgment, for better or for worse.

Second, and this is possibly more subtle, by shifting the responsibility to the government, we don't have to take any responsibility ourselves. We don't have to personally face the poor, the orphan, the widow, the sick, the dying. We can, in fact, ignore them and go on with our lives, because, after all, there's a government program to take care of them.

So I submit that it is not at all a violation of Christian principles to want to place limits on government-imposed income redistribution and the creeping expansion of the "Nanny State." And I find it interesting that conservatives, who tend to want those limits, are, statistically, more charitable personally than liberals. Conservative families give more than liberal families, across the board, in every income bracket. Republicans, statistically, are more charitable than Democrats. "Red" states are more charitable than "blue" states. The residents there volunteer more, both for religious and secular causes. They're even more likely to donate blood.

Does that mean that we should remove all government safety nets? No, not at all. But if I had to judge which philosophy was more consistent with the teachings of Jesus - to say, "We need to raise taxes so we can fund another government program," or to say, "No, it's not the government's job to do this, it's my job, and I'll put my money where my mouth is!" - I would have to say it's the latter.

Thanks for listening.

Thanks, Newsweek, Now I KNOW I'm Gonna Love It!

Greetings from the Left Coast!

When I woke up this morning and first launched my browser, two things caught my eye on the msn.com home page: first, a big headline that said "GOP Pledges to Cut Taxes, Spending." Hmmmm. Republican leaders are circulating a draft of a new "Pledge to America." OK. A couple of lines below that? Another link that said, "Analysis: 'Pledge' Unlikely to Inspire Voters," that led to a Newsweek article that - surprise, surprise - didn't think much of the new Pledge.

Since I am somewhat familiar with the political slant of Newsweek, i.e., if you offered me a free copy, I wouldn't bother to walk across the street to get it, that suggested to me that I might, indeed, find this new pledge inspiring.

So I did what I would urge everyone to do - I read it for myself. It's only 21 pages long (less than 1% the size of, say, the ObamaCare bill), so it didn't take me all that long.

Over the coming days and weeks, lots and lots of people are going to try to tell you what it says and why it should, or shouldn't, matter. Ignore them all and read it for yourself, then draw your own conclusions.

My personal reaction to it? If I could have presented a document to Congress in a big red binder labeled, "PLEASE - just do these things for me, and I'll be content!" this is the document I would have written. Yes, I know it's only a draft at the moment. Yes, there's a little, cynical voice in the back of my mind that whispers, "Yeah, it sounds good, but will they really follow through?" But it's being drowned out by the louder voice that's saying, "My God, if they actually do these things, it will make such a difference!"

OK, OK, here are a couple of teasers:

In a self-governing society, the only bulwark against the power of the state is the consent of the governed, and regarding the policies of the current government, the governed do not consent...

We pledge to honor the Constitution as constructed by its framers and honor the original intent of those precepts that have been consistently ignored – particularly the Tenth Amendment, which grants that all powers not delegated to the United States by the Constitution, nor prohibited by it to the states, are reserved to the states respectively, or to the people...

The American people know that to boost the economy, spending must be slashed, tax increases must be prevented, and small businesses must have certainty that the rules won’t change every few months so they can get back on their feet. The constant threat of new taxes and new regulations prevents investors and entrepreneurs from putting capital at risk. These private sector employers must be given the certainty that if they take a risk to expand their company or hire a new employee, Washington won’t yank the rug from under their feet...

We will ensure that bills are debated and discussed in the public square by publishing the text online for at least three days before coming up for a vote in the House of Representatives. No more hiding legislative language from the minority party, opponents, and the public. Legislation should be understood by all interested parties before it is voted on...

We will require each bill moving through Congress to include a clause citing the specific constitutional authority upon which the bill is justified....

Got your interest yet? By the way, Newsweek really didn't like that last point, for the very convoluted reason that it somehow encroached on the power of the judiciary, which is supposed to determine whether or not legislation is constitutional. But, dang, if I didn't know better, I'd think they (the GOP, not Newsweek) had been reading this blog!

Please. Just read it. Don't take anybody else's word for it - not even mine. Read it for yourself, then make up your mind.

Thanks for listening.

Why Political Parties Are Important

Greetings from the Left Coast!

All his life, my father was an independent voter. He never joined a political party, and took pride in voting "for the man, not the party." When I became old enough to vote, my first inclination was to do the same. But in the forty years since then, I've discovered why my father was wrong:

First, after politicians get into office, they generally vote the way their party tells them to vote. This has never been more obvious than in the last 18 months. Why? Well, there isn't much of a future for a freshman Senator or Congressman who opposes his party leadership. You don't get the choice committee assignments that way. In fact, you may find that you don't even get any help the next time you're up for re-election. So you may think that you're voting "for the man," but you're really voting for the party, whether you intended to or not.

Second, with the sole exception of the Senate Ethics Committee (a.k.a. the Oxymoron Committee), the membership of every committee in each house of Congress is determined by the ratio of Democrats to Republicans in that house. E.g., if the House of Representatives is 60% Democrat, then the Democrats will also have 60% of the seats on each and every House committee. Moreover, the majority party will also hold the chairmanship of each and every committee.

And that's where the work gets done. The committees determine what legislation gets drafted, and are largely responsible for drafting it. The committees determine whether a particular piece of legislation even gets brought to the floor of the chamber for a vote. When the Senate and House pass slightly different versions of a bill, a joint reconciliation committee tries to come up with an acceptable compromise.

In short, the committees are where the power resides. Yet there is little or no personal accountability for the members. Everybody knows who the President is - he's an easy target. But can you name even one member of the House Committee on Energy and Commerce? This lack of personal accountability explains why, although the overall approval rating of Congress is lower than the proverbial snake's belly, individual incumbents keep getting re-elected over and over again.

The takeaway from all this is clear: if you want to change the direction of the country, you must change the party that controls Congress. It's just that simple.

Thanks for listening.

Flash: The Great Recession Is Over!

Greetings from the Left Coast!

Well, it's official: the Great Recession is over! In fact, according to the National Bureau of Economic Research, it's been over for more than a year - the economy has been expanding since June, 2009! Don't you feel better now? You don't? Hmmmm. Maybe that's because, although we may have been expanding since June, 2009, it's been at a snail's pace. And when unemployment is still hovering around 10%, and you're upside down on your home mortgage, it sure doesn't feel like a recovery. Economists estimate that the economy needs to grow at twice the rate that's expected for this year in order to reduce the unemployment rate by a single percentage point.

But let's talk a little about this thing called an economic recession. If you've been in the work force for less than 10 years, this recession probably came as a real shock to you, because you had never seen anything but prosperity. In fact, throughout our nation's history, long periods of economic expansion have been the exception, not the rule. Until the early 1960s, it seemed like a recession came along every 2 to 4 years. (See http://en.wikipedia.org/wiki/List_of_recessions_in_the_United_States for details.) The nearly 9 years of sustained economic growth from February, 1961, to December, 1969, was the longest uninterrupted period of growth ever up to that point in time.

And the last 30 years or so have really been remarkable. Between the recession that ended in November, 1982, and the one that started in December, 2007 - a span of just over 25 years, the economy was in recession a total of only 16 months. And had it not been for the September 11 terrorist attacks, we might have avoided the 2001 recession altogether (provided you weren't in the high-tech sector, which suffered the double-whammy of the dot-bomb bust and the inevitable dropoff in corporate technology spending that followed the Y2K spending spree).

The fact is that good times never last forever. Economic contractions happen. Honest men differ over what causes the contractions - whether they're caused by outside "shocks" to the economic system, or whether they're simply an inevitable part of economic growth and adjustment. But recessions happen. They happen when Republicans are in the White House. They happen when Democrats are in the White House. It's a safe bet that no one will ever completely eliminate them. And despite what you hear from politicians on either side, it's seldom the "fault" of the person in the Oval Office - he's just the most convenient target. Which is not to say that government policies can't make things worse. Obviously, they can, and we're living through that right now.

The burning question of the moment is what, if anything, government should do when a recession hits, to mitigate the effects as much as possible and encourage a return to growth. Again, honest men differ. The current administration obviously adheres to the Keynesian theory that the right thing to do is to spend massive amounts of money to get things moving again. Unfortunately for President Obama and his fellow Democrats, it doesn't seem to be working any better this time than it's worked in the past.

Obama sees himself as a modern-day Franklin Roosevelt. Unfortunately, he's taking all the wrong pages from FDR's playbook. FDR was a brilliant public speaker who lifted everyone's expectations with his promises of how great the New Deal was going to be. He blamed his predecessor, Herbert Hoover, for being the "greatest spender in history." He promised to reduce the federal budget by 25%, and work toward a balanced budget. Yet, by the time his first term ended, federal spending had doubled. In May, 1939, Treasury Secretary Henry Morgenthau told a congressional committee: "We are spending more money than we have ever spent before and it does not work... We have never made good on our promises...I say after eight years of this Administration we have just as much unemployment as when we started...and an enormous debt to boot."

Does any of this sound familiar? (For more on the parallels between Obama and FDR, I'd recommend an excellent article on thenewamerican.com written by William P. Hoar back in February, 2009, when Obama had barely taken office.)

An objective look at history will tell you two things:

1. First, when people are allowed to keep more of their own money, consumer spending will generally increase. And when wealthy people are allowed to keep more of their own money, they will tend to invest it in ways that create jobs. Yes, that means that we need to stop playing this stupid class-warfare game that crys about "tax cuts for the wealthy." As we've written here before, the wealthy already pay a disproportionate share of all income taxes. It would therefore be impossible to craft a meaningful tax cut that wouldn't disproportionately benefit the wealthy.
2. The one thing business hates more than anything else is uncertainty. Whether it's the small business down on the corner trying to decide whether they can afford to add one employee, or a large business trying to decide whether to invest in a new factory, new equipment, or a branch office, not having a predictable business climate will delay or kill those plans. And right now nothing is certain. The current administration's behavior can only be interpreted in one of two ways - either they're totally clueless about how the private sector operates, or they're hostile toward it. Business people don't know whether they're going to be the next group demonized by the Obama administration. They don't know what kind of tax is going to hit them next. They don't know what's going to happen to their energy costs. They don't know what their health care costs are going to be. And until that changes, you're not going to see substantial growth in the private sector.

In the recession of 2001, the Bush Administration and Congress acted quickly to cut taxes, and reassure businesses. Despite the threat of terrorism, and the fear of where the terrorists might strike next, the recession lasted only 8 months, GDP (Gross Domestic Product) contracted by only 0.3%, and unemployment topped out at 6.3%.

In early 2008, hampered by a hostile Democrat-controlled Congress that cared more about winning back the White House than anything else, there were limits to what the Bush Administration could do. Still, if we are to believe the National Bureau of Economic Research, the decline in GDP bottomed out in June of 2009 - far too soon for any of Obama's actions to have had any material effect on it - but jobs continued to be lost at an alarming rate even while the economy was, technically, beginning its anemic growth. In July, 2010 (a year after the recession supposedly ended), the unemployment rate of people who were seeking full-time employment stood at 10.2%. The "U6" rate - which also counts "discouraged workers" who have given up looking for work, "marginally attached" workers who "would like" to work but have not looked for work recently, and the underemployed who are working part time but would like to work full time if they only could - was at 16.7% last month (August).

The inescapable truth is that just about every economic move the Obama Administration has made has made things worse, not better, yet their only response is to want to do more of it. We need to, first, take Congress away from the Democrats so there will at least be some check on Obama's blind ambition. Then, in 2012, we need to turn him into former President Obama. If he still wants to push hope and change, maybe he can team up with former President Carter and help build houses for some of the people who have lost theirs to foreclosure while historians argue over which of them was the worst President since World War II.

Thanks for listening.

The Summer of Recovery Draws To a Close

Greetings from the Left Coast!

As the "Summer of Recovery" draws to a close, we have the chance to reflect on what an amazing summer it was. The Democrat juggernaught that looked unstoppable only a few months ago is coming apart at the seams, as the American public begins to realize that, in a brief spasm of credulity, they have managed to put the fox in charge of the chicken-house. President Obama's approval ratings have fallen through the floor: as of today, according to Rasmussen's Daily Presidential Tracking Poll, 44% of the nation's voters "strongly disapprove" of his performance, with only 27% strongly approving - an "approval index" of -17. In fact, President Obama has more people in the "Strongly Disapprove" column than George W. Bush did in his last full month in office - President Bush was only at 43%!

Why? Because the American people have discovered that nearly everything he claimed to be, he is not:

• He was supposed to be the post-racial candidate, yet he and his supporters are the ones who pull out the "race card" regularly and predictably. Apparently it is not possible for anyone to be opposed to President Obama's policies, any opposition to his agenda must be racism.
• He was supposed to be the great uniter - the one who would reach across the aisle and bring us all back together. Put an end to the partisan bickering. But his actual approach to bipartisanship, once his party actually controlled both houses of Congress, amounted to, "I won, you lost. So either fall in line, or sit down and shut up."
• His adminstration was to have been a paragon of openness. Yet we have seen multi-thousand-page bills crafted entirely by Democrats behind closed doors, and rammed through with not only no opportunity for Republicans to participate in the process, but without even the opportunity for the rest of the country to know what the bills actually said.
• His health care bill is now being exposed as the debacle that it is. Health insurance premiums are going up substantially across the board as insurance companies are being forced to comply with all of the new requirements. And that's just the beginning - there's not enough room in this post to do justice to the subject.

And, in the minds of many voters, it has become obvious that his administration has absolutely no clue how to actually make the economy better. All they've done is to spend money like proverbial drunken sailors, and distort every market they touch:

• State and local governments across the country have been spending beyond their means for years. Obama's stimulus package allowed them to dodge taking responsibility for their irresponsibility by pouring billions of tax dollars into preserving public sector jobs...for a while. Now the money is spent, and those state and local government budgets are still upside down, because it's the private sector economy that has to pay for those public sector jobs, and the private sector is still on its lips.
• The "Cash for Clunkers" program did indeed boost new automobile purchases...until the money ran out. Then automobile sales dropped through the floor again. Moreover, the used car market was hurt, and the auto repair business was hurt, because of regulations that required that cars traded in had to be junked. And the engines had to be deliberately ruined by replacing its engine oil with a sodium silicate solution and running it for a while - which meant that engine blocks and parts like pistons couldn't be sold by automobile recyclers. (The Law of Unintended Consequences strikes again.)
• Subsidies for new home purchases boosted home sales for a while...until the program ended. New home sales in May dropped off 32.7% compared to April, and were 18.3% below the May 2009 figure.

In fact, the main effects of the automobile and home purchase experiments were to prove - if it needed proving - that if you offered free money, a lot of people would take it (gee, who would have guessed that?), and to distort the markets by artificially boosting demand for a short period of time, followed by a drop off in demand to a lower level than it was in the beginning.

The one thing that apparently has never occurred to them is that letting people actually keep more of the money they earned might be a good thing. If they got to keep more of it, they just might spend more of it. And if the people who had money to invest - you know, those evil "rich people" - got to keep more of their money, they might invest more of it in ways that created private sector jobs. But, as John Kerry famously said last year, there's no guarantee that, left to our own devices, we would invest in the right things - which is why government has to do it for us.

And that's proven to be the last straw. The American people are just plain tired of having things rammed down their throats by the federal government that they don't want, and being told in the process that it's for their own good and they're just too stupid to realize it. We're tired of being called names like "racist," "hater," "islamophobe," or all of the above, ever time we disagree with something.

This whole American experiment in self government got started nearly 250 years ago over the issue of taxation without representation. And the Democrats are about to discover that there is no better way to feel the wrath of the American voter than to ignore the fact that they work for the people, not the other way around. Many of them are already trying to run from the tsunami of voter disapproval that's coming. In the next couple of months, you're going to hear more and more Democrats start sounding like Republicans. They're going to continue to try to distance themselves from Obama's policies. They're going to start talking about how unwise it would be to raise taxes on anybody while we're still mired in recession. Don't you believe it. If they somehow manage to hold onto power, they'll be right back to their old ways in a heartbeat.

If you want to change the direction the country is headed in, you must change who is in control of Congress this November. It's just that simple.

Thanks for listening.

A Message to that Lucky 47 Percent

Greetings from the Left Coast, where we here at Left Coast Blues do the heavy thinking for those who just can't be bothered.

NEWS FLASH: The Associated Press has apparently just discovered that nearly half of all Americans will pay no federal income tax this year! And that almost 40% will actually get money from the government! And that 73% of all federal income tax collected comes from only 10% of the population! Wow! Who knew?

Well, you did, if you've been following this blog, because we've written about this before. But, now that it's actually being reported by the national press, I'd like to point out a few things that should be intuitively obvious:

• First of all, it's obviously unfair (and if you've been listening to Obama and the rest of the Democrat leadership, you know they care deeply about fairness) that 73% of the tax burden should be paid by only 10% of the people, and that nearly half of the population should pay nothing toward services that benefit everyone.


• Second, this should, once and for all, settle the issue of whether or not the government is advocating the redistribution of income. If a small portion of the population is shouldering a disproportionate share of the tax burden, and a large portion of the population is being given (not refunded) money that they didn't pay into the system, that is redistribution of income. End of story.


• Third, we are getting uncomfortably close to the point where a majority of the electorate has nothing to lose by voting for higher taxes and spending, because (they will think) the tax burden is going to be paid by somebody else (the "rich").

But here's where it all falls down. The federal budget deficit is now so unimaginably huge that you could tax "the rich" at a rate of 100% and still not cover it. Even liberal Democrats are now saying that it is unsustainable and must be brought under control. This, of course, would be laughable if it wasn't so tragic for the nation, since they are largely the ones who created it. And, of course, their solution isn't to bring it under control by reducing federal spending...they want to raise your taxes - hence the recent trial balloon regarding a "value-added tax."

So, just for a moment, let me talk directly to the 47% of my fellow Americans who aren't paying any federal income tax. You should know that federal income taxes account for only about half of the government's revenue. You're paying a big chunk of that other half in ways you never see - like Social Security taxes that are not going into some kind of "trust fund," but in fact are being used to run one of the biggest Ponzi schemes ever perpetrated. Oh, I know you see the portion of Social Security taxes that are taken out of your paycheck, but you never see the matching amount that your employer pays (unless you're self-employed, in which case you get to pay both halves). That's money your employer doesn't have available to give you a raise, or some other kind of benefit, because it's going to the government. You're also impacted by other kinds of taxes levied on businesses, who ultimately pass the costs along to you when you buy their products.

Here's an example everyone should be able to understand: Let's say that a loaf of bread costs $2.00, and you've got $4.00 in your pocket. You can buy two loaves of bread. If the federal government directly levies a $2.00 tax on you, you can now buy only one loaf of bread. That's easy to understand - everybody gets that. But if the federal government, through some other policy decision, causes the price of bread to rise to $4.00 per loaf, that also results in your being able to buy only one loaf of bread. So there is no difference in terms of the effect it has on your life.

There are many ways for this to happen. One is to simply keep up that deficit spending until inflation kicks back in. And, if we stay on the path we're on, it will - with a vengeance. Another is to pass laws that cause the cost of energy to go up - thereby increasing the cost of plowing, planting, and harvesting the wheat, transporting it to market, milling it into flour, baking it into bread, and delivering the bread to your local grocer. In fact anything the government does that increases the cost of doing business is ultimately going to get passed along to you, the consumer, in the form of higher prices. What's the difference between seeing your purchasing power erode because of higher prices, and seeing your purchasing power erode because you're paying more taxes? None. Either way, your standard of living goes down.

It has been said that, while capitalism may be the unequal distribution of wealth, socialism is the equal distribution of misery. We are already on that slope, and it's slippery as hell. We have to elect leaders who will reverse course, before it's too late, or our grandchildren and great-grandchildren will look back and curse us for being so selfish and short-sighted.

Thanks for listening.

You Go, Rob!

Greetings from the Left Coast, where we here at Left Coast Blues do the heavy thinking for those who just can't be bothered.

Today, Washington State Attorney General Rob McKenna announced that he would be joining a law suit against the Democrat's health care reform bill. Governor Christine Gregoire wasted no time attacking him for that decision. Fortunately, it is his decision to make, not hers. The Attorney General represents the State of Washington and its citizens, not the governor.

In fact, he has a sworn duty to defend the interests of the State of Washington when, in his judgment, its rights have been infringed. And only blind partisanship could claim that they have not been infringed by the health care bill.

We have this annoying document called the Bill of Rights. Some of you may remember it. It consists of the first ten amendments to the Constitution. The tenth amendment states quite clearly that any powers not explicitly granted to the federal government by the Constitution are reserved to the states and to the people.

Nowhere in the Constitution is the federal government given the power to mandate that the citizens of the United States must purchase a specific product. Yet the health care bill attempts just such a mandate by requiring that everyone must purchase a health insurance policy, or be punished for not doing so.

This is, as we stated back in early November, the first step on a very slippery slope. This is a very dangerous precedent to set. There is no telling where this will end. Why, you might end up being told that you had to buy florescent bulbs for your lights instead of incandescent ones! (Oh, wait - I guess we started down this slippery slope quite some time ago, didn't we?)

The loss of individual freedom has been likened to the "frog in the pot" phenomenon: if you try to drop a frog into boiling water, he'll fight like the dickens to get out of it. But if you put him into cool water and gradually turn up the heat, he'll sit there and die before he realizes that he's in danger.

Maybe people are finally waking up and deciding it's gone too far. I just hope that Rob McKenna and the other state attorneys general can get us out of the pot before it's too late.

Thanks for listening.

Why the Party Is Important

Greetings from the Left Coast, where we here at Left Coast Blues do the heavy thinking for those who just can’t be bothered.

If the last several months have taught us anything, it should have taught us about the importance of political parties, and laid to rest the old fallacy that “voting for the candidate, not the party” is somehow a noble or virtuous approach to elections.

My father, God rest his soul, was proud of the fact that he didn’t belong to any political party, and was a firm believer in voting for the person he believed was the best candidate, regardless of party affiliation. Since that’s the way I was raised, that was the philosophy I took with me into the voting booth, starting way back in 1970 when I voted for the first time, and for a long time after that.

No more. I can state unequivocally that there are no circumstances that I can imagine that would ever cause me to vote for a Democrat again. It has become painfully obvious that when it comes down to crunch time, in the majority of cases, politicians vote their party affiliation regardless of whether it’s in the best interests of the American people in general or their constituents in particular. Nowhere has this been more obvious than in the debate over the health insurance legislation, which has now been rammed down the throats of the American people despite the fact that a large majority of the people didn’t want it.

When a particular party holds a majority in either the House or the Senate (and, of course, the Democrats currently hold majorities in both), that means that all of the committees are chaired by that party. It also means that the majority party will compose a majority of the members of each committee (with the sole exception of the Senate Ethics Committee, which was explicitly created as a committee with equal party representation). Since Congressional committees ultimately control what legislation does and does not make it to the floor of the House or Senate for a vote, the majority party pretty much controls the legislative process, if they can hold their members together.

The only real check on this kind of power is the fact that, in most cases, it takes a “supermajority” in the Senate to agree to end debate on a bill and call for an up or down vote. If that supermajority doesn’t exist, then debate can theoretically continue indefinitely, with the bill never coming to a vote. That’s called a filibuster.

For the past two years, we’ve been living with a “perfect storm” that gave the Democrats nearly absolute power: they held a majority in the House, they held a supermajority in the Senate, and they held the White House. We’ve now seen the abuse of power that results when the traditional checks and balances of government aren’t functioning.

Thanks to Scott Brown’s victory in Massachusetts, the Democrats no longer hold a supermajority in the Senate. That’s why it was crucially important to the party leaders that the Senate version of the legislation should be passed unaltered by the House – because any changes they House made would have to go back to the Senate for approval, and approval could no longer be guaranteed.

Don’t be misled. The “House Reconciliation Bill” that was passed at the same time the House passed the Senate bill is a long ways from being law – and the Representatives that voted for it are well aware that they may never see any actual changes in the Senate bill. The reconciliation bill must now go to the Senate. It’s debatable, by they way, whether it even falls under the Senate’s “reconciliation” rules. The Democrats are going to try to shove it through that way, because it would therefore be exempt from the supermajority requirement. But the Senate’s own rules state that the substance of any provisions in a reconciliation bill must be substantially weighted to the budget, and not to policy.

Violating this rule will set a precedent that is sure to lead to more and greater abuse in the future. Senator Barak Obama was strongly opposed to this sort of thing back when the Republicans were considering it. Funny how things change, isn’t it?

By the way, if the Senate makes any changes to the reconciliation bill, it has to go back to the House again. So we could see a protracted game of ping-pong with this reconciliation bill, while the original bill the Senate passed gets signed into law by President Obama. And you’ve got to ask yourself what motivation exists for the Senate to approve a bunch of changes that the House wants to make to their bill, when at this point all they need to do is to do nothing, and their own version becomes law. But, amazingly, Nancy Pelosi said, “Trust me,” and apparently 218 of her fellow Democrats did. Which brings me back to my original assertion: it’s stupid to vote for the person and not for the party – because when the chips are down, odds are that the person you elected is going to vote for the party and not for you.

So what can we do? Not much between now and November other than to give our money to the opponents of the people who voted for this monstrosity. Then, when November rolls around, vote them out of office. Every single one, if possible. And I sincerely hope that the voters in Louisiana’s 2nd Congressional District have a better Republican candidate this fall than Representative Anh Cao, who was the single Republican to vote in favor of this bill.

And what of the 39 Democrats that voted against it? Well, I appreciate their courage in breaking from their leadership. But please go back and re-read the section above where I discuss the implications of a given party holding a majority in the House or the Senate. The fact is that as long as there is a “D” after their names, they affect that balance of power and, in my opinion, must be targeted for defeat.

Thanks for listening.

Giving Credit Where Credit Is Due

Greetings from the Left Coast, where we here at Left Coast Blues do the heavy thinking for those who just can't be bothered.

On Wednesday, I was pleased to see an editorial in my morning Everett Herald that brought some much needed honesty and perspective to the coverage of Sen. Jim Bunning. Sen. Bunning, you may recall, was the Senator who was allegedly blocking the $10 Billion package that would extend unemployment benefits, health insurance subsidies for the jobless, highway programs, and Medicare payments to doctors.

Most of the news coverage portrayed Sen. Bunning as the callous, heartless guy who, indifferent to the suffering he was inflicting on countless fellow Americans, was unreasonably standing in the way of a compassionate piece of legislation just because he could. In fact, what he was saying was that, instead of just continuing to give lip service to how concerned we all are about our unsustainable deficit spending, maybe we should tap into the more than $500 Billion in unspent stimulus money to pay for the legislation instead of going another $10 Billion into debt.

That, as the Herald editorial pointed out, hardly seemed unreasonable. But it was rejected by Senate Majority Leader Harry Reid.

Moreover, Sen. Reid could have moved the legislation forward at any time by simply holding a "roll call" vote. But, no, Senate Democrats wanted a "voice vote," where the "ayes" and "nays" are said as a group, and the presiding leader gets to decide which was the largest group. One can only conclude that this was because a roll call vote would have involved having each individual Senator go on the record with his or her vote, which might have led to some actual accountability to the public for how they voted. Why risk that - especially when they saw an opportunity to further demonize the evil, obstructionist Republicans with the all-too-willing help of their friends in the media?

So, kudos to the Herald editorial staff for having the courage to break with the accepted media template. And to all the others who collaborated in this charade, including Washington's own Sen. Patty Murray: Shame on you!

Thanks for listening.

Three Important Axioms

Greetings from the Left Coast, where we here at Left Coast Blues do the heavy thinking for those who just can't be bothered.

As you think about what you heard in last night's State of the Union Speech - or read about what you didn't hear if you're among those who had more important things to do than listen to another campaign speech - please keep three important things in mind. In fact, we would do well to remember these three things any time we're listening to a politician, and any time we're about to step into a voting booth. (Or sit down at the kitchen table to fill out that mail-in ballot if you're like us Washington voters who don't have voting booths anymore.)

1. The government cannot give anything to anybody without first taking it from somebody else.


2. When someone receives from the government something they did not work for, it means that somebody else worked for it without receiving it.


3. The government cannot create wealth. It can only redistribute it.

If you stop and think about these axioms, you will find that they logically lead to several other conclusions, one of which is: The government cannot create jobs - unless they're government jobs, which then increase the tax burden on the private sector, thus reducing wealth creation and the ability of the private sector to create jobs. The best that the government can do is to try to create an environment in which the private sector can flourish.

Who does create jobs? Well, it's well known that most jobs in this country are created by small businesses - a fact that's at least given lip service by the current administration. Who are the people who start small businesses? They are people who have managed to accumulate enough wealth that they're willing to take a financial risk in order to try to create more. It takes capital to start a small business. It takes more capital to run it for the first few years and (hopefully) nurse it into sustained profitability. That capital typically comes out of the savings of the person who started the business - who typically works extremely long hours for little or no pay in the hope that the business will pay off before the savings run out.

These are the "rich" people that the Democrats want to pile even more of the tax burden on. Problem is, when you take their wealth away, fewer businesses - thus fewer jobs - get created. Plus the incentive to work those long hours is reduced when you know that a bigger chunk of what you're working for is just going to be taken away from you anyway.

So keep those things in mind - particularly when you hear the wild claims about how many jobs were "created or saved" by the stimulus package, and the calls, which will become louder and more numerous as we approach the mid-term election, for a "jobs package" that will spend even more money that we don't have in an attempt to create jobs.

Print out the three axioms above. Tape them to your bathroom mirror. Read them out loud several times a day. If enough people really came to understand the truth in them, we would really start to see some change we could believe in.

Thanks for listening.

How Did We Come to This?

Greetings from the Left Coast, where we here at Left Coast Blues do the heavy thinking for those who just can’t be bothered.

Today we set our sights a little closer to home. We here in the great State of Washington are facing some pretty serious budget shortfalls. We’ve been hearing that budget cuts alone can’t address all of it – there will simply have to be some tax increases. In fact, Governor Christine Gregoire told us in December that she “can’t live” with the level of cuts that would be necessary to deal with a $2.6 billion budget deficit – “…That’s not my values, and I don’t believe it’s the values of the people of the State of Washington,” she told us.

She may be right – after all, the handwriting was already on the wall when the people of the State of Washington re-elected her in 2008. The Seattle Times (not exactly a bastion of conservative thought) reported in July, 2008, that state spending had increased by $8 Billion during her first term of office – a 31% increase in the two-year general-fund budget. At the time the article was written, the Senate Ways and Means Committee was already predicting a $2.7 Billion shortfall when the time came in January 2009 to write a new two-year budget…and at that time, the recession was just beginning to be felt here in Washington.

We managed to skate by for the last year with some creative accounting and Federal "stimulus" money, but we're now halfway through the budget period, and it's becoming clear that we're in serious trouble for 2010.

During the 2008 campaign, things were still going pretty well here in Washington... and Gov. Gregoire was quick to jump on the “blame Bush” bandwagon: if Washington State should happen to sink into recession, she told us, we should blame Bush, not her. ("Pay no attention to those Democrats behind the curtain!") Of course, according to the U.S. Constitution, Congress controls the purse strings of the federal government, and the Democrats have held majorities in both houses of Congress since 2006…but I digress.

Let’s take a closer look look at the math. The Times article cited above only dealt with the General Fund portion of the budget. If we look at all three components of the budget - the General Budget, the Capital Budget, and the Transportation Budget - you'll find that the budget grew from $52.2 Billion in the 2003 - 2005 biennium to $69.2 Billion in the 2007 - 2009 biennium. (The biennium runs from July 1 of an odd-numbered year through June 30 of the next odd numbered year, which is why the dates look a little funny.) That's a $17 Billion increase - almost 33%. Population growth from mid-2003 to mid-2007 was only about 6.5% (from a little over 6.1 million to about 6.5 million). That means that the state budget grew at almost five times the rate of population growth!

By the state’s own figures, since the beginning of the recession, nearly 13% of manufacturing jobs and nearly 27% of all construction jobs in the state have been eliminated. The seasonally-adjusted unemployment rate hit 9.3% in October – up a full 3 percentage points from the year before. Have a similar percentage of State government jobs been eliminated? Um…no. In November, 2008, The Seattle Times reported that there were roughly 66,000 state employees. That was down about 1,200 from early August, 2008, as a result of a hiring freeze, but much of that decrease was in seasonal jobs with parks or the Department of Natural Resources. The State’s 2009 State Workforce Report reported total employment at 65, 290 as of June 30, 2009. That’s a drop of only about 1%.

But that’s the pattern we’ve seen over and over again from Democrat-controlled governments: during good times, government spending increases way out of proportion to any other measure of population or economic growth – then when the bad times hit, gosh, we simply can’t reduce spending by that much! It would require cuts to vital services and too much hardship for people who have become dependent on that government spending. And I will guarantee you that any cuts that are proposed this year will be the most visible and painful that the legislature can find – because maximum visible pain means maximum odds that voters will accept tax increases instead of insisting on budget cuts.

If you want to see where that pattern ultimately leads, just look two states to the south. California’s plight was highlighted by The Guardian in the U.K. last October in an article entitled “Will California become America’s first failed state?” Unfortunately, The Guardian fails to answer its own question of “where did it all go wrong?” other than to highlight the effects of the crash of the housing market.

American Thinker does a better job of identifying the causes of California’s demise: “California is facing economic failure resulting from years of a liberal legislature pursuing a liberal version of utopia.” After years of tax-and-spend policies, the voters finally revolted and insisted on lower taxes. Unfortunately, that same liberal legislature refused to rein in spending, ultimately bringing the state to the crisis it faces today, with unemployment over 12%, its government bonds rated barely above “junk,” and so many people leaving the state that it could lose a Congressman when the 2010 census is tabulated.

Want to end up like California? Then let Gov. Gregoire and the rest of the Democrats in Olympia keep on running things, and I guarantee you that’s where we’ll end up. It’s past time for Washingtonians – and all Americans – to start holding our politicians accountable for their actions. That means insisting on fiscal responsibility from them, and voting out the people who don’t get the message. That also means paying sufficiently close attention to politics that you know who’s fiscally responsible and who isn’t.

Thanks for listening.