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Archive for April 13th, 2010

The politicians in Washington act as if businesses are ATM machines that can be fleeced every time there’s a new boondoggle to finance. That is a deeply flawed assumption even in the case of big corporations, but it is utterly absurd when considering the challenges of creating a small business. Here’s a video produced by my Cato colleague Caleb Brown that gives a personal perspective on what it means to be an entrepreneur. And since Caleb has submitted this video for a contest being sponsored by the Chamber of Commerce, do me a favor and share it widely so he gets more views.

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This video from the folks at Reason TV shows how excessive government – especially a bloated government workforce – is debilitating California’s economy. The comparisons with Texas are a powerful example of why good policies are important.

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I have a column in the Washington Times speculating on ways we could lower our tax bills if we could use the same creative accounting that the Congressional Budget Office and Joint Committee on Taxation used to help impose Obamacare on the nation. Lots of tongue-in-cheek sarcasm:

If you’re still struggling over your tax return, wondering why you pay so much to finance a dysfunctional and wasteful government, maybe it’s time you adopted the same rules used by government number crunchers. The Congressional Budget Office (CBO) and Joint Committee on Taxation (JCT) helped push the health bill across the finish line by forecasting that (don’t laugh) a giant new entitlement program for government-run health care would reduce long-run budget deficits. A closer look at what they did suggests that as we approach April 15, taxpayers could save a bundle of money if they used the same creative accounting as CBO and JCT. For example: When CBO and JCT concoct their official scores about increases or decreases in government spending or revenue, they use “base-line” math. So when CBO said Medicare spending would be cut by several hundred billion dollars over the next 10 years, the first thing you need to understand is that Medicare spending actually will be increasing during that time period from $528 billion this year to about $1 trillion in 2020. But CBO says Medicare spending will be “cut” because it is not increasing even faster. Imagine if you got to do the same thing with your tax return. Not many of us received raises last year because of an economy weakened by bad government policy. But let’s say you were one of the lucky ones (a government employee, perhaps?) and you got a $5,000 raise. Unfortunately, Uncle Sam is going to want a big chunk of that additional money. Here’s where CBO accounting would be a big help. Why don’t you assume that you were going to get a raise of $10,000. Because your pay “only” went up by $5,000, you can claim your pay was reduced. The IRS will come down on you like a ton of bricks, but you can tell the agents as they cart you away that you were following official government methodology. (Maybe they’ll go easy on you when you tell them that an identical approach helped push the IRS budget up to $12 billion.)

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