Weekly Musing 7-28-13
Obamacare: the most blatant liberal failure of public policy that should be repealed. No ill-conceived socialization of an industry has led to greater loss of jobs and increased cost. A disaster. Repeal it.
Defund the IRS: only “bold” and “big” reform will provide us with an opportunity to defund or virtually shut down the IRS. Either a “flat tax” or “fair tax” offer us an chance for real change.
Syria: stay out. Not our fight and a policy objective of “status quo” or helping promote constant chaos is stupid.
Detroit: a managed bankruptcy that addresses the root of most of the problems is the ONLY viable solution. A bailout is little more than throwing good “borrowed” money after bad “borrowed” money!
Senate Immigration Bill: finally, the pork filled, “comprehensive” mess of a bill appears to be dead. There are legitimate ways to deal with our current problem without “amnesty” and a “new path to citizenship”. We can legalize, document and show compassion to all and by the way, we do have a path to citizenship ANYONE is free to follow….legally.
Republican Circular Firing Squad: be careful what you wish for.
Bill O’Reilly says what many are thinking…
You may or may not agree with everything he says….but there is NO doubt that the typical liberal solution of more government and/or money is NOT the answer. Now we have a “conversation”.
R.I.P. Betty Jane Hershey
Our thoughts and prayers go out to Jane Abraham and her family. Her mother who has lived with the Abrahams for the last several years passed away July 20th. As most of you know, Jane served as our Co-Chairman of the MIGOP when I was Chairman and her husband was a State Chairman, U.S. Senator and Secretary of Energy. Our deepest condolences go out to the Hershey & Abraham families.
THE NEW FLAT TAX: Encourages Growth and Job Creation
The New Flat Tax, as outlined in Heritage’s ‘Saving the American Dream’ plan, would replace today’s convoluted tax system with a simple, neutral, and transparent tax system that would allow America to achieve its full economic potential.
One Tax System with One Rate for All: In addition to the income tax, the federal government imposes payroll tax, death tax, and a slew of excises. The New Flat Tax replaces them all for individuals, families, and businesses with one tax system with one tax rate of roughly 28 percent.
Two Tax Credits: The New Flat Tax retains the Earned Income Credit to preserve the level of income support for low-wage workers. And low- and middle-income families also receive a tax credit of $3,000 ($2,500 for singles) toward the purchase of health insurance.
Three Deductions: The only remaining deductions are for higher education, gifts and charitable contributions, and an optional home mortgage interest deduction.
ANOTHER viable alternative is the “Fair Tax” which would be a flat sales or consumption tax.
In Much-Hyped Speech On The Economy, Obama Offers Up More Of The Same – Double downs on Obamanomics
Obama doubled down on his approach in 2012: division, polarization and moving to the left.
Much like in 2012, the President placed little emphasis on tax reform or growth. He spoke of bringing jobs back to America – specifically in manufacturing – but did not reveal many details of how he would achieve this.
We heard some talk of balancing the budget and deficit reduction, cornerstone issues of the protracted battle in the House at the end of last year and beginning of 2013. But there was no talk of a long-term deficit reduction plan or plan for entitlement reform that will save crucial programs like Social Security, Medicare and Medicaid.
The President emphasized redistribution above all else, but with, again, no long-term plan as to how he would finally make this approach an effective one. Indeed, he hid behind the terms “ineffective government” and “broken Washington,” giving himself leeway in not having solved the economic problems that he promised to fix in both 2008 and 2012.
When Did Obama Decide That The Scandals He Once Thought Were Serious Are Now ‘Phony’?
On Wednesday, President Barack Obama set the tone for the debate surrounding the many controversies that have plagued his administration since the spring. The president called those scandals “phony” and denigrated those who find any worth in their investigation. But, as one prominent conservative opinion writer noted yesterday, it was not long ago that the White House was acknowledging the seriousness of the scandals he now derides as contrived.
“With an endless parade of distractions, political posturing and phony scandals, Washington has taken its eye off the ball,” Obama said during a marathon speech in Illinois.
The Unsteady States of America – It is not just Detroit. American cities and states must promise less or face disaster
WHEN Greece ran into financial trouble three years ago, the problem soon spread. Many observers were mystified. How could such a little country set off a continental crisis? The Greeks were stereotyped as a nation of tax-dodgers who had been living high on borrowed money for years. The Portuguese, Italians and Spanish insisted that their finances were fundamentally sound. The Germans wondered what it had to do with them at all. But the contagion was powerful, and Europe’s economy has yet to recover.
America seems in a similar state of denial about Detroit filing for bankruptcy (see article). Many people think Motown is such an exceptional case that it holds few lessons for other places. What was once the country’s fourth-most-populous city grew rich thanks largely to a single industry. General Motors, Ford and Chrysler once made nearly all the cars sold in America; now, thanks to competition from foreign brands built in non-union states, they sell less than half. Detroit’s population has fallen by 60% since 1950. The murder rate is 11 times the national average. The previous mayor is in prison. Shrubs, weeds and raccoons have reclaimed empty neighbourhoods. The debts racked up when Detroit was big and rich are unpayable now that it is smaller and poor.
Other states and cities should pay heed, not because they might end up like Detroit next year, but because the city is a flashing warning light on America’s fiscal dashboard. Though some of its woes are unique, a crucial one is not. Many other state and city governments across America have made impossible-to-keep promises to do with pensions and health care. Detroit shows what can happen when leaders put off reforming the public sector for too long.
Carl Levin: GOP lawmakers taking an ‘unfair and unbecoming potshot’ at Detroit with bailout talk
Democratic U.S. Sen. Carl Levin on Thursday criticized a series of Republican-authored amendments seeking to deny federal funding to
Detroit or other struggling cities.
“The city of Detroit has not asked for a bailout,” Levin, a former Detroit City councilman and long-time resident, said in a released statement. “But it is surely entitled to seek federal funding from existing programs. The approach a few senators have taken, raising the specter of a bailout in pursuit of some perceived political advantage, is an unfair and unbecoming potshot at our city and its people that I will strongly oppose.”
“There’s no good reason why Detroit or any other American city ought to receive a taxpayer-funded bailout from Washington,” Cornyn said, per The Hill. “I hope that the normal bankruptcy process will be allowed to go forward, and I hope that the bankruptcy follows the rule of law, and the Obama Administration resists any temptation to meddle in the process and play politics.”
Look to China to Revitalize Detroit
Detroit can learn from China about how to turn adversity into strength. China suffered through a century of humiliation to an unprecedented rise that continues today.
Wei Yuan, a Chinese scholar (1794 – 1857) attempted to combine traditional scholarly knowledge with practical experience to find workable solutions to problems of the day. In his book, Records of the Conquest, Wei writes, “Humiliation stimulates effort; when a country (city) is humiliated, its spirit will be aroused” or “To feel shame is to approach courage.”
China’s insight and leadership could help revitalize the once iconic American city.
Detroit Is Dead. Long Live Oakland County
Since 1950 the population of Detroit has fallen by more than 60 percent, from 1.8 million to 700,000. Over that same period the population of Oakland County—a square comprising Ferndale, Southfield, Birmingham, and a cluster of other cities and towns—tripled, to 1.2 million. The county today is one of the wealthiest in the country, and 8 Mile Road has the feel of an international border. The relationship between Detroit, the nation’s poorest city, and its northern neighbors often resembles a border dispute, characterized on both sides by anger, resentment, fear, and caricature. Detroit’s July 18 bankruptcy filing is merely the latest chapter in the long dysfunctional marriage between a once-thriving city and its suburbs.
If there’s one person who best embodies this psychodrama, it’s L. Brooks Patterson, the county executive of Oakland and for decades one of Detroit’s harshest critics. Patterson, 74, who was elected to his sixth term last fall, has held the post since 1993. He previously made a name for himself as county prosecutor by leading the fight against school desegregation through busing. He’s a unique combination of green-eyeshade superego and raging demagogic id. His pitch—both to voters and businesses—is that Oakland County is everything Detroit is not, and that it doesn’t need Detroit to survive. “In the old days they’d say, ‘As Detroit goes, so goes Michigan,’ ” he says in his office in Waterford. “That’s bulls---. As Oakland County goes, so goes Michigan.”
Broken City: Detroit – How Detroit’s epic bankruptcy could help the rest of the country
The lights have gone out in Detroit, literally. Forty percent of the streetlights don’t work, since there isn’t enough money to keep them on, or up, in a city that some 60 years ago was the richest in the country and perhaps the world. But that was another time, when the city’s manufacturing might powered the Arsenal of Democracy and its factories turned out the cars that shaped the map of modern America.
Now, Detroit has acquired bragging rights that make it the envy of no one. By declaring bankruptcy on July 18, it became the largest-ever municipal failure in the U.S. Creditors — including big-name investors and pension funds — are already knocking at the door, waiting to see who will get paid first, or at all. Public workers are bracing for pension cuts that may leave their retirement plans in ruins. Residents can look for taxes to go up even as services continue to decline.
Detroit’s pain is unavoidable if the city is to save itself — but it may ultimately help save other cities too. That’s because America’s cities desperately need a wake-up call to fix their finances. Though nearly everyone agrees that Detroit is in particularly bad shape, many of its underlying issues — crushing debt and unfunded and unsustainable retiree benefits — are not unique. And those legacy costs are at the heart of what many experts believe is a coming municipal-finance crisis in the U.S.
Saving Detroit From Itself
One myth is that Detroit is a victim of the U.S. auto industry. But the city’s breakdown preceded the decline of GM, GM -1.11%Ford and Chrysler and has continued despite their resurgence. American car makers have been doing better for three years, but Detroit is getting little benefit because the industry long ago left the city. Michigan’s jobless rate has fallen to 8.7% from 14.2% in August 2009, and the rate is now 6.2% in suburban Dearborn (Ford headquarters), but still 16.3% in Detroit.
Detroit’s decline really began with the middle-class migration to the suburbs in the 1950s, which accelerated after the 1967 race riot and election of labor organizer Coleman Young as mayor in 1973. During his 20-year reign, Mr. Coleman ignored crime, inflamed racial tensions and built a patronage machine. (See Steve Malanga’s history nearby.)
Local politicians bought union support with generous labor agreements. Pensions were sweetened retroactively. In good investment years, retirement funds issued bonus checks. Until two years ago public-safety officers didn’t have to pay a penny to their pensions and could retire at 55 with roughly 85% of their salary, a 2.25% annual cost-of-living increase and nearly free health benefits.
Stein’s Law: Liberalism can’t go on forever?!?
Detroit, for example, can no longer go on borrowing, spending, raising taxes and dangerously cutting such essential services as street lighting and police protection. So it stops. It goes bust.
Cause of death? Corruption, both legal and illegal, plus a classic case of reactionary liberalism in which the governing Democrats — there’s been no Republican mayor in half a century — simply refused to adapt to the straitened economic circumstances that followed the post-World War II auto boom.
RNC launches ’50 State Strategy’ to catch up to Dem ground game
The Republican National Committee is launching its own “50 State Strategy” aimed at putting GOP staff in every state and catch up to Democrats’ superior ground game before the 2014 elections.
“While the Obama campaign built this for one candidate, we are building a permanent campaign to help the Republican party up and down the ticket,” RNC spokeswoman Kirsten Kukowski said.
GOP’s new tech strategy leads to Silicon Valley in quest to ‘leapfrog’ Democrats
The Republican Party is turning to the Democratic den of Silicon Valley to launch a start-up — laying plans to open a new office there and hire dozens of software developers tasked with reinventing the GOP’s technology operation for the 2014 mid-term elections.
Officials say the new multi-million-dollar program will give GOP candidates the ability to amass more detailed information than ever about individual voters. The data would help candidates narrowly tailor appeals for votes and money. The system would, in many ways, try to mimic many of the digital innovations that helped President Obama’s reelection campaign last year.
The move follows a scathing spring review by the Republican National Committee, which assailed the party and the campaign of its 2012 presidential nominee, Mitt Romney, for falling short in digital marketing and voter outreach. The report called for more “intellectual curiosity” and for party members to be “more sophisticated” with data and to improve collaboration. In short, it said: “Republicans do not do this very well.”
State Republican parties mired in dysfunction
Plagued by infighting and deep ideological divisions, state Republican parties from Alaska to Maine are mired in dysfunction. Several state Republican leaders have been forced out or resigned in recent months, and many state GOP parties face financial problems and skeptical national leaders.
Democrats are not immune to such problems, but the conflicts on the Republican side highlight the tug of war over the GOP’s future as national leaders work to improve the party’s brand. At the same time, the Republican dysfunction raises questions about the GOP’s ability to coordinate political activities in key battleground states ahead of next year’s midterm congressional elections.
“There’s been a lot of division and disharmony in the Republican Party,” newly elected Maine GOP Chairman Rick Bennett told The Associated Press.
National GOP officials say help is on the way.
Libertarianism and the coming Republican political war
Two things happened this week that revealed the basic dynamic of the fight for control of the Republican party in 2016.
The first was a vote on the House floor that would have significantly curtailed the the NSA’s phone-surveillance program as outlined in the Patriot Act. A vote that was widely regarded by Congressional sharps as a sort of “blow off steam” vote for civil libertarians nearly passed the House. In total, 134 Republicans (59 percent of House GOP) voted against the measure — including almost all of the party leadership — while 94 (41 percent) voted for it.
The second were comments made by New Jersey Gov. Chris Christie at a panel at the Aspen Institute on Thursday. “As a former prosecutor who was appointed by President George W. Bush on Sept. 10, 2001, I just want us to be really cautious, because this strain of libertarianism that’s going through both parties right now and making big headlines, I think, is a very dangerous thought,” Christie said.
Taken together, it’s quite clear that the choice in 2016 will be heavily defined by just how much libertarianism Republicans want in their party. The answer isn’t clear yet. But, that more than 40 percent of the Republican conference voted for legislation that would significantly curtail the reach of a government agency designed, at least in part, to preventing future terrorist attacks is telling. So, too, is the fact that Christie, widely expected to run in 2016, picked a fight with libertarians — and Kentucky Sen. Rand Paul, in particular — in the summer of 2013.
Senate 2014 and Beyond
First, a little history: Aside from a brief, roughly half-year period between the seating of Sen. Al Franken (D-MN) after a disputed election in the summer of 2009 and the election of Sen. Scott Brown (R-MA) in early 2010, neither party has held 60 senate seats at any point since the 95th Congress (1977-78), when the Democrats controlled 62 seats. (The Republicans have never held 60+ Senate seats since the advent of popular U.S. Senate elections in 1913).
The current Senate is made up of 52 Democrats; two independents who caucus with the Democrats; and 46 Republicans. Let’s assume, for the sake of argument, that Democrats win back the Senate seat held by appointed Sen. Jeff Chiesa (R-NJ) in an October special election. With that in mind, here’s what the Senate is likely to look like by late October — 55 members of the Democratic caucus, and 45 members of the Republican caucus:
Where Obama Fails, GOP Governors Find Solutions
Almost half the jobs created during the Obama recovery have been created in Texas. Which perhaps means it should be called the Obama-Perry recovery. Or the Perry-Obama recovery – it’s not clear who should get top billing, though outgoing Texas Gov. Rick Perry certainly has pushed a better pro-growth agenda than the president.
In fact, while the “blue states” are running up debt and flirting with bankruptcy, the “red states” continue to take the lead in cutting taxes, streamlining government and job creation, according to a report issued Monday by the State Government Leadership Foundation and being distributed by the Republican Legislative Campaign Committee.
The full report, which can be found here, shows the contrast in performance by states where the Republicans are in charge measured against states where Democrats hold the reins of power. “Reviewing the accomplishments of state legislatures across the country reveals a clear pattern – that Republican legislatures are not only right on the issues voters care about most, they have also focused on issues that benefit their entire state’s population,” the RLCC said in a release accompanying the report.
Remember When Obama Said Detroit Was Coming Back?
Detroit’s failings are many and its debts staggering. Obama did not cause them. But his economic remedies and intervention have achieved little. And his unhinged enthusiasm about what was happening in Detroit in 2011, and how it fit into the larger story of American economic life, provides an inconvenient backdrop for Obama’s economic address Wednesday and those that follow.
Statism is turning America into Detroit – Ayn Rand’s Starnesville come to life
The population of Motown has fallen from two million to 700,000, and once prosperous neighbourhoods have become derelict. Seventy six thousand homes have been abandoned; estate agents are unable to shift three-bedroom houses for a dollar.
The Observer, naturally, quotes a native complaining that ‘capitalism has failed us,’ but capitalism is the one thing the place desperately needs. Detroit has been under Leftist administrations for half a century. It has spent too much and borrowed too much, driving away business and becoming a tool of the government unions.
Stalled Motor City
Detroit has been a “model city” for big-government! All Detroit’s mayors since 1962 were Democrats who were eager to micromanage. And spend. Detroit has the only utility tax in Michigan, and its income tax is the third-highest of any big city in America (only Philadelphia and Louisville take more, and they aren’t doing great, either).
Detroit’s automakers got billions in federal bailouts.
The Detroit News revealed that Detroit in 2011 had around twice as many municipal employees per capita as cities with comparable populations. The city water and sewer department employed a “horseshoer” even though it keeps no horses.
Facing Up to America’s Pension Woes
As recently as three years ago, the conventional wisdom held that public-pension promises, no matter how extravagant, are sacrosanct even if a city files under Chapter 9, the provisions of federal law that govern municipal bankruptcies. The first hint that this thinking might be wrong came after Vallejo, Calif., filed for bankruptcy in 2008.
Vallejo successfully restructured its collective-bargaining agreements and, as then-City Manager Robert Stout reported, the city believed that Chapter 9 gave Vallejo the legal authority to alter its pensions as well. But Calpers, the giant bureaucracy that administers California’s state and local pensions, threatened litigation. The city concluded that any reduced pension costs wouldn’t be great enough to offset the legal costs and backed off.
Obamacare forces work hour limits for CMU students
College students at one Mid-Michigan school who work more than 25 hours a week will take a big pay cut beginning next year.
Central Michigan University says to meet requirements under the federal healthcare reform law, students cannot exceed that workload.
This policy change is a big blow to students who rely on the extra cash to pay for books, rent and other expenses.
So Much for Immigration Reform
It’s hard to be optimistic about the prospects for comprehensive immigration reform when you talk to House Republicans. My conversations suggest that if anything passes the House, it will most likely be small, bite-sized morsels of largely noncontroversial ideas—lowest-common-denominator items that bear little resemblance to the sweeping immigration measure that passed the Senate on June 27.
I recently asked a very smart House Republican to rate the prospects for immigration reform in the chamber on a scale of zero to 100—with zero meaning the House passes nothing in this Congress and 100 meaning it approves the Senate-passed comprehensive plan. The answer was 35. In my view, a 35 would represent something along the lines of the Dream Act, legislation that would provide legal status to those who came to the United States as undocumented children and have gone on to college or joined the military. A version of the Dream Act passed the House in 2010, when Democrats controlled the chamber, but it failed to clear the Senate. House Republicans are working on a new version of the measure, which could be more restrictive than the 2010 legislation in terms of the number of immigrants who qualify. And even a restrictive version could be too ambitious for this House.
Paul Ryan lays out immigration proposals in Racine town hall meeting
The U.S. Senate has already passed an immigration reform bill that included a 13-year path to citizenship for the estimated 11 million people who are in the country illegally.
“A lot of people are saying, just pass the Senate bill,” Ryan said. “That’s not what the House is going to do.
“I think we can make it better.”
“I’m not doing this for politics,” Ryan later said. “I think it’s the right thing to do for the country.”
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