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Archive for February, 2010

The United States may not have the freest economy in the world. And America may not be the best place to live. But we do have the most hotties, at least according to a poll of British travelers that was linked on Instapundit. Having done a bit of travel myself, I’d put Estonia at the top of the list for those who prefer blondes and Montenegro for those who prefer brunettes. But what do I know? Here’s a report on the survey from the Daily Telegraph:

The United States, home to George Clooney and Jessica Simpson, came top in a poll of more than 5,000 globe-trotting Britons. In second place was Brazil while Spain, which boasts Hollywood actress Penelope Cruz as one of its natives, was third. Blonde, tanned surfers of Australia saw it voted into fourth place, while Italy came fifth. Sexy Swedes, such as model Victoria Silvstedt, helped it into sixth spot, but England only made it into seventh place in the poll. India was eighth, France ninth, and Canada finished off the top 10. …A spokeswoman for www.OnePoll.com, which carried out the study, said: ”America has got a lot on offer and boasts some of the sexiest people on the planet.

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One of the many reprehensible features of Washington is how companies climb into bed with government. They do this either because they want legislation to get undeserved wealth by screwing consumers or competitors, or they do it because they think they the government is going to do something bad to them and they hope to reduce the pain by acting like cringing curs. This is a good description of the global-warming/climate-change/whatever-they’re-calling-it-now issue, where many big companies are part of a coalition to support the Administration’s statist agenda. The good news is that this coalition is now beginning to fall apart, as thee big companies have decided that having a “seat at the table” isn’t such a good idea if it’s Thanksgiving and you’re a turkey. The Wall Street Journal reports:

Three big companies quit an influential lobbying group that had focused on shaping climate-change legislation, in the latest sign that support for an ambitious bill is melting away. Oil giants BP PLC and Conoco-Phillips and heavy-equipment maker Caterpillar Inc. said Tuesday they won’t renew their membership in the three-year-old U.S. Climate Action Partnership… “We think there’s momentum to get [a climate bill] done,” USCAP spokesman Tad Segal said. “President [Barack] Obama’s State of the Union address made it clear the administration is behind us.” But experts said the companies’ decision to withdraw from USCAP is a sign the politics of climate change is shifting in Washington. When Mr. Obama took office, Congress appeared to have momentum for a climate bill that would push the economy toward lower-carbon alternatives. But as the economy soured, support waned.

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Many of the leaders of the conservative movement just released the Mount Vernon Statement, which is supposed to identify a common set of principles. It culminates with these words:

A Constitutional conservatism based on first principles provides the framework for a consistent and meaningful policy agenda. It applies the principle of limited government based on the rule of law to every proposal. It honors the central place of individual liberty in American politics and life. It encourages free enterprise, the individual entrepreneur, and economic reforms grounded in market solutions. It supports America’s national interest in advancing freedom and opposing tyranny in the world and prudently considers what we can and should do to that end. It informs conservatism’s firm defense of family, neighborhood, community, and faith.

These are fine words, but what do they achieve? Should there be a no-tax increase pledge? A commitment to reduce the size of government, or to shut down agencies, programs, and departments that are not proper functions of the federal government?

To be sure, a statement of principles is not supposed to be a policy platform, so perhaps it’s not the right place to call for, say, replacing a bankrupt Social Security system with individual accounts.

On the other hand, it isn’t too much of a stretch to imagine President Obama’s speechwriters putting very similar language in one of his speeches. So if the principles of the conservative movement are so vague that collectivists and statists can pretend to support them, what exactly is the point?

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Barack Obama wants higher tax rates on the so-called rich, including steeper levies on income, capital gains, dividends, and even death! Along with other greedy politicians in Washington, he acts as if successful taxpayers are like sheep meekly awaiting slaughter. In reality, class-warfare tax policies generally backfire because of the five reasons outlined in this video:

A new study from Boston College provides additional evidence about the consequences of hate-and-envy tax policy. The research reveals that high tax rates in New Jersey have helped cause wealthy people to leave the state, leading to a net wealth reduction of $70 billion between 2004 and 2008. Wealth and income are different, of course, so it is worth pointing out that another study from 2007 estimated that the state lost $8 billion of gross income in 2005. That’s a huge amount of income that is now beyond the reach of the state’s greedy politicians. Here’s a report from the New Jersey Business News:

More than $70 billion in wealth left New Jersey between 2004 and 2008 as affluent residents moved elsewhere, according to a report released Wednesday that marks a swift reversal of fortune for a state once considered the nation’s wealthiest. Conducted by the Center on Wealth and Philanthropy at Boston College, the report found wealthy households in New Jersey were leaving for other states — mainly Florida, Pennsylvania and New York — at a faster rate than they were being replaced. …The study – the first on interstate wealth migration in the country — noted the state actually saw an influx of $98 billion in the five years preceding 2004. The exodus of wealth, then, local experts and economists concluded, was a reaction to a series of changes in the state’s tax structure — including increases in the income, sales, property and “millionaire” taxes. “This study makes it crystal clear that New Jersey’s tax policies are resulting in a significant decline in the state’s wealth,” said Dennis Bone, chairman of the New Jersey Chamber of Commerce and president of Verizon New Jersey. …In New Jersey, the top 1 percent of taxpayers pay more than 40 percent of the state’s income tax, he said. “That’s probably why we have these massive income shortfalls in the state budget, especially this year,” he said. Until the tax structure is improved, he said, “we’ll probably see a continuation of the trend, until there are no more high-wealth individuals left.” He added the report reinforces findings from a similar study he conducted in 2007 with fellow Rutgers professor Joseph Seneca, which found a sharp acceleration in residents leaving the state. That report, which focused on income rather than wealth, found the state lost nearly $8 billion in gross income in 2005. …Ken Hydock, a certified public accountant with Sobel and Company in Livingston, said in this 30-year-career he’s never seen so many of his wealthy clients leave for “purely tax reasons” for states like Florida, where property taxes are lower and there is no personal income or estate tax. In New Jersey, residents pay an estate tax if their assets amount to more than $675,000. That’s compared to a $3.5 million federal exemption for 2009. Several years ago, he recalled, one of his clients stood to make $60 million from stock options in a company that was being acquired by another. Before he cashed out, however, the client put his home up for sale, moved to Las Vegas, and “never stepped foot back in New Jersey again,” Hydock said. “He avoided paying about $6 million in taxes,” he said. “He passed away two years later and also saved a huge estate tax, so he probably saved $7 million.”

Still not convinced that high tax rates are causing wealth and income to escape from New Jersey? The Wall Street Journal wrote a very powerful editorial about the Boston College study, noting that New Jersey “…was once a fast-growing state but has now joined California and New York as high-tax, high-debt states with budget crises.” But the most powerful part of the editorial was this simple image. Prior to 1976, there was no state income tax in New Jersey. Now, by contrast, highly-productive people are getting fleeced by a 10.75 percent tax rate. No wonder so many of them are leaving.

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TRADITIONAL VERSION

The ant works  hard in the withering heat all summer long, building his house and  laying up supplies for the winter.

The grasshopper thinks the ant is a fool and laughs and dances and plays the summer away.

Come winter, the ant is warm and well fed.

The grasshopper has no food or shelter, so he dies out in the cold.

MORAL OF THE STORY: Be responsible for yourself!

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OBAMA-REID-PELOSI VERSION

The ant works hard in the withering heat and the rain all summer long, building his house and laying up supplies for the winter.

The grasshopper thinks the ant is a fool and laughs and dances and plays the summer away.

Come winter, the shivering grasshopper calls a press conference and demands to know why the ant should be allowed to be warm and well fed while he is cold and starving.

CBS, NBC, PBS, CNN, and ABC show up to provide pictures of the shivering grasshopper next to a video of the ant in his comfortable home with a table filled with food.

America is stunned by the sharp contrast.

How can this be, that in a country of such wealth, this poor grasshopper is allowed to suffer so?

Kermit the Frog appears on Oprah with the grasshopper and everybody cries when they sing, ‘It’s Not Easy Being Green.’

ACORN stages a demonstration in front of the ant’s house where the news stations film the group singing, “We shall overcome.” Then Rev. Jeremiah Wright has the group kneel down to pray to God for the grasshopper’s sake.

President Obama condemns the ant and blames capitalism for the grasshopper’s plight.

Nancy Pelosi & Harry Reid exclaim in an interview with Larry  King  that the ant  has  gotten rich off the back of the grasshopper, and both call for an immediate tax hike on  the ant to make him pay his fair share.

Finally, the EEOC drafts the Economic Equity & Anti-Grasshopper Act retroactive to the beginning of the summer.

The ant is fined for failing to hire a proportionate number of green bugs and, having nothing left to pay his retroactive taxes, his home is confiscated by the Government Green Czar and given to the grasshopper.

The story ends as we see the grasshopper and his free-loading friends finishing up the last bits of the ant’s food while the government house he is in, which, as you recall, just happens to be the ant’s old house, crumbles around them because the grasshopper doesn’t maintain it.

The ant has disappeared in the snow, never to be seen again.

The grasshopper is found dead in a drug related incident, and the house, now abandoned, is taken over by a gang of spiders who terrorize the ramshackle, once prosperous and once peaceful, neighborhood.

The entire Nation collapses bringing the rest of the free world with it.

MORAL OF THE STORY: If you choose to become a parasite, don’t kill your victim.

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Saw something very interestin on the National Review blog. We finally have some good news in the battle between government workers and the serfs who support them (i.e., taxpayers). A Rhode Island town, frustrated by the intransigence of the teacher union, decided to fire the entire staff of the local high school. The union was upset that teachers were being asked to work harder, even though teachers make more than three times as much as the town’s median income. Hopefully, this is a sign that taxpayers have finally become fed up and state and local politicians will decide that they need to side with the people pulling the wagon rather than those riding in the wagon. Here’s an excerpt from the Providence Journal:

Under threat of losing their jobs if they didn’t go along with extra work for not a lot of extra pay, the Central Falls Teachers’ Union refused Friday morning to accept a reform plan for one of the worst-performing high schools in the state. The superintendent didn’t blink either. After learning of the union’s position, School Supt. Frances Gallo notified the state that she was switching to an alternative she was hoping to avoid: firing the entire staff at Central Falls High School. In total, about 100 teachers, administrators and assistants will lose their jobs. Gallo blamed the union’s “callous disregard” for the situation, saying union leaders “knew full well what would happen” if they rejected the six conditions Gallo said were crucial to improving the school. …In an interview, Jane M. Sessums, union president, said the union intends to fight the terminations, although she was not ready to say how.

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A story from the U.K.’s Daily Mail shocked me for two reasons. First, a supermarket has announced that it won’t offer valuable savings on infant formula because it violates European law. Apparently, there are lots of bored bureaucrats in Brussels who apparently have nothing better to do than concoct such inane policies. That was bad enough, but the story also reveals that the government sends bureaucrats to the homes of new mothers to badger them back in the workforce (presumably to pay taxes to support needless bureaucrats). Can anyone from England tell me if this is a mandatory program? Do families have to accept visits from these baby-ogling bureaucrats?

New mothers are being denied valuable money saving offers on infant milk formula because of ‘politically correct’ pressure to breast feed. Boots says it cannot award loyalty points on milk for newborns because it is against EU law to ‘promote’ bottle feeding. …Under European legislation, Boots and other stores with loyalty schemes can be penalised by trading standards officers for ‘incentives’ to buy formula milk for babies up to six months. …Health visitors sent to help new mothers have been told to ask them when they will go back to work. They have been instructed to find out about job plans as part of routine checks on the health of the baby. The pressure on mothers to think about an early return to work has come as part of a Government drive to widen the role of health visitors. But their union last night called the edict ‘unethical’, while mothers said the intrusive questioning made them feel guilty for wanting to stay at home to look after their families.

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The bureaucrats at the TSA must be trying to surpass their colleagues at various motor vehicles departments in the race for bone-headed and inane bureaucracy. Here’s a story from Philadelphia about abusive treatment of a 4-year old kid with leg braces. Even though I think it’s ridiculous, I can understand the rule about not allowing metal to go through without more inspection. But what possible purpose does it serve not to allow a parent to carry a child through?

This happened to Bob Thomas, a 53-year-old officer in Camden’s emergency crime suppression team, who was flying to Orlando in March with his wife, Leona, and their son, Ryan. Ryan was taking his first flight, to Walt Disney World, for his fourth birthday. The boy is developmentally delayed, one of the effects of being born 16 weeks prematurely. His ankles are malformed and his legs have low muscle tone. In March he was just starting to walk. …The boy’s father broke down the stroller and put it on the conveyor belt as Leona Thomas walked Ryan through the metal detector. The alarm went off. The screener told them to take off the boy’s braces. The Thomases were dumbfounded. “I told them he can’t walk without them on his own,” Bob Thomas said. “He said, ‘He’ll need to take them off.’ ” Ryan’s mother offered to walk him through the detector after they removed the braces, which are custom-made of metal and hardened plastic. No, the screener replied. The boy had to walk on his own. …Bob Thomas was furious. He demanded to see a supervisor. The supervisor asked what was wrong. “I told him, ‘This is overkill. He’s 4 years old. I don’t think he’s a terrorist.’ ” The supervisor replied, “You know why we’re doing this,” Thomas said. Thomas said he told the supervisor he was going to file a report, and at that point the man turned and walked away.

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Saw this linked on Instapundit. It’s poetic justice when scam artists and moochers get mocked.

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Prime Minister Gordon Brown has done a terrible job and is widely unpopular.. But even if the opposition party wins control later this year, it may not make much of a difference. The leader of the Tory party, David Cameron, is a British version of a RINO. He has not pledged to reduce the burden of government spending (which, as the chart illustrates, has skyrocketed). He has not pledged to reverse Brown’s dramatic increase in the top tax rate. And now the Conservative Party is expressing support for a huge increase in the value-added tax. The UK-based Times reports:

A rise in VAT is looming whichever party wins the general election, as Labour and the Conservatives draw up plans to balance Britain’s books. Alistair Darling and George Osborne, the Shadow Chancellor, are both considering raising VAT to as high as 20 per cent — the European average — from the current rate of 17.5 per cent, The Times has learnt. …One City source close to the Tory tax team said: “There is a view across the Conservative Party that VAT is going to have to go up.” The Chancellor is also keenly aware that Britain needs to retain the confidence of the credit-rating agencies. He has privately ruled out either raising income taxes or increasing the scope of VAT, but has deliberately left open the possibility of increasing the sales tax in the next Parliament.

P.S. As usual, my technical skills are grossly deficient and I can’t figure out how to get the graph to appear, but click on the box to see how the burden of government has exploded in the United Kingdom (makes George W. Bush and Barack Obama look like fiscal conservatives by comparison).

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Mark Steyn has a typically witty column that covers everything from the infamous Audi Superbowl commercial to the kid who was stopped by TSA for having Arabic-language flash cards. But he closes his piece with this powerful statement:

…the difference between America and Europe is that, when the global economy nosedived, everywhere from Iceland to Bulgaria mobs took to the streets and besieged Parliament demanding to know why government didn’t do more for them. This is the only country in the developed world where a mass movement took to the streets to say we can do just fine if you control-freak statists would just stay the hell out of our lives, and our pockets. You can shove your non-stimulating stimulus, your jobless jobs bill, and your multi-trillion-dollar porkathons.

There are obviously millions of Europeans who want to be left alone and millions of Americans who like sticking their snouts in the public trough, but Mark’s observation is generally true. The United States is the only major nation that still has a libertarian tradition of individual liberty and personal responsibility. This is why we need to stop government-run healthcare and roll back the nanny state. Yes, it is bad that bigger government undermines growth and prosperity, but the real danger is that collectivism will destroy the American soul.

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The healthcare fight in Washington is not about access to doctors and hospitals, or the cost of those services. It is an effort by the left to create more dependency on government. George Will examines this theme in a Washington Post column:

Killing this small program, which currently benefits 1,300 mostly poor and minority children, is odious and indicative. It is a small piece of something large — the Democrats’ dependency agenda, which aims to multiply the ways Americans are dependent on government. Democrats, in their canine devotion to teachers unions, oppose empowering poor children to escape dependency on even terrible government schools. …For congressional Democrats, however, expanding dependency on government is an end in itself. They began the Obama administration by expanding the State Children’s Health Insurance Program. It was created for children of the working poor but the expansion made millions of middle-class children eligible — some in households earning $125,000. The aim was to swell the number of people who grow up assuming that dependency on government health care is normal. …Democrats’ “reforms” of the financial sector may aim to reduce financial institutions to dependent appendages of the government. By reducing banks to public utilities, credit, which is the lifeblood of capitalism, could be priced and allocated by government. …Many Democrats, opposing the Supreme Court, advocate new campaign finance “reforms” that will further empower government to regulate the quantity, timing and content of speech about government. Otherwise voters will hear more such speech than government considers good for them.

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The Union Leader newspaper in New Hampshire has a correct view of the absurd $130 million “census awareness budget,” inlcuding the reprehensible decision to squander $2.5 million on an ad during the Super Bowl. It’s bad enough that the Census has evolved into an exercise in nanny-state intrusion, rather than the simple head-counting exercise as our Founders envisioned. But it adds insult to injury (or should it be injury to insult?) that our tax dollars are being wasted to publicize the exercise. Anybody want to guess whether the public relations agency that got the contract for this boondoggle donated money to Obama?

Did you see that Super Bowl ad for the U.S. Census? If not, too bad, because you paid $2.5 million for it. Maybe you can catch it on YouTube. If you think that’s outrageous, it gets worse. The $2.5 million is just 1.9 percent of the government’s $130 million “census awareness budget.” Oh, yes. Just in case you didn’t know that Census Bureau workers will be coming to your home this year to do what they have done every 10 years for more than two centuries, Washington is spending $130 million of your money to tell you. …It’s also par for the course in a Washington so awash in money that $130 million isn’t considered serious spending, and yet the government still manages to outspend revenues by $1.6 trillion.

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Even though the American people don’t want government-run healthcare, and even though Democrats are very nervous after losing a supposedly-safe Senate seat in Massachusetts, Obamacare is not dead. The Democrats still have huge majorities in the House and Senate and the White House clearly is trying to put the GOP back on the defensive. Exhibit A is the President’s invitation for a televised healthcare summit on February 25. Exhibit B is the fact that the Congressional Budget Office has greased the skids by concocting preposterous estimates that government-run healthcare will reduce the budget deficit. This may seem like meaningless wonkery, but it could allow the Democrats to use the “reconciliation” process to impose Obamacare with just 51 votes in the Senate. Here are two reminders of why it is utterly absurd to think that a giant new entitlement program will reduce red. First, we have an excerpt from a Wall Street Journal column about how the “cost curve” is bending up rather than down. Second, we have a Center for Freedom and Prosperity video that looks at the evidence confirming that government-run healthcare will be a budget buster:

Richard Foster, the chief actuary for the Centers for Medicare and Medicaid Services, reports that under his analysis national health spending will rise under the bills by $222 billion over the next 10 years. In other words, ObamaCare really does “bend the cost curve”—up. Even that estimate exists only on paper, as Mr. Foster has the honesty to admit. Because “most of the coverage provisions would be in effect for only six of the 10 years of the budget period, the cost estimates shown in this memorandum do not represent a full 10-year cost for the proposed legislation,” he writes. The report is punctuated by phrases like “unrealistic” and “doubtful,” and Mr. Foster adds that “the scope and magnitude of these changes are such that few precedents exist for use in estimation.” …ObamaCare is “paid for” only in the sense that Medicare’s payments to doctors are assumed in the bill to be cut by more than 20% this spring and even deeper after that, which will never happen in practice. …As for the White House’s promise that it will reduce health spending painlessly by cutting “waste,” Mr. Foster isn’t buying it. He writes that “we find the language as it now reads is not sufficiently specific to provide estimates.” The report also calls out the new entitlement program for long-term care, which is included only because it will start collecting premiums five years before it starts paying benefits. In return for this accounting gimmick, the fisc will be saddled with a program that Mr. Foster estimates will be bankrupt by 2025.

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I’m told these posters are created by a guy named Oleg Volk. All I know is that I got an email with a bunch of them and they are right on message. The two I posted earlier and these two are my favorites. That’s the good news.

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In a rational world, Switzerland would be a role model for other nations. It is quite prosperous thanks largely to a modest burden of government. There is remarkable ethnic and religoius diversity, but virtually no tension because power is decentralized (sort of what America’s Founders envisioned for the United States). Yet despite these – and many other – attractive features, Switzerland is being persecuted because of strong human rights laws that protect financial privacy. Money-hungry politicians from other nations resent Swtizerland’s attractive policies, and they would rather trample Swiss sovereignty rather than fix their own oppressive tax laws. An official from the Swiss Bankers Association provides some background in a New York Times column:

In Switzerland, this tradition of treating a client’s financial affairs in confidence became law in 1934 when it was codified in Article 47 of the country’s first-ever federal banking act as a contemporary reaction to the economic crisis, various domestic political considerations and well-publicized cases of espionage involving France and Germany. …Banking secrecy, therefore, is not some gimmick the Swiss devised to attract foreign clients to their banks. It reflects the very high degree of trust that exists between the Swiss state and its citizens and it has strong democratic foundations. …The Swiss are proud of their system and they reward it with a high level of taxpayer honesty. It works because the Swiss vote their own taxes, they have a high degree of control over the way tax revenues are spent and over all they believe their tax system to be reasonable, comprehensible, transparent and fair. The principle of self-declaration backed up with withholding taxes and, if necessary, stiff fines supports this “honesty box” system. …Doesn’t Switzerland hear the snapping jaws and cracking whips of foreign finance ministers, tax collectors, O.E.C.D. bureaucrats, cash-dispensing government agents and other denizens of the encroaching real world as they circle round Mother Helvetia intent on biting huge chunks out of her banking secrecy, if not swallowing it whole? …In March last year the Swiss announced they would give up the evasion-fraud distinction for foreign bank clients and adopt  the O.E.C.D. standards on information exchange in tax matters. …However, requests for assistance must be made with regard to a specific individual, and “fishing expeditions” — any indiscriminate trawling through bank accounts in the hope of finding something interesting — remain ruled out. …Switzerland demonstrates to the world that it is possible for a state to collect taxes with a high degree of taxpayer honesty and without the authorities being corroded with suspicion about the financial activities of their citizens. Citizens in a democracy would never allow their police force to have an automatic right of forced entry into their homes just on the off-chance of finding some stolen goods, so why on earth should the state have an automatic right of forced entry into citizens’ banks accounts just on the off-chance of discovering some tax evasion? There must be a limit to the extent to which respect for an individual’s privacy is sacrificed on the altar of international cooperation in tax matters.

Sadly, the United States is part of the effort to create a global tax cartel. An “OPEC for politicians” would be terrible news for taxpayers, though, much as a cartel of gas stations would be bad for driviers. So-called tax havens play a valuable role in curtailing the greed of the political class. Ask yourself a simple question: Would politicians be more likely or less likely to raise tax rates if they knew taxpayers had no escape options?

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The White House recently released the Economic Report of the President. In a post at the White House blog, Christina Romer brags that the stimulus legislation was a big success.

This Act is the great unsung hero of the past year.  It has provided a tax cut to 95 percent of America’s working families and thousands of small businesses.  It has meant the difference between hanging on and destitution for millions of unemployed workers who had exhausted their conventional unemployment insurance benefits.  It has kept hundreds of thousands of teachers, police, and firefighters employed by helping to fill the yawning hole in state and local budgets.  And, it has made crucial long-run investments in our country’s infrastructure and jump-started the transition to the clean energy economy.  All told, the Recovery Act has saved or created some 1½ to 2 million jobs so far, and is on track to have raised employment relative to what it otherwise would have been by 3.5 million by the end of this year. 

Let’s set aside some of the disingenuous components of her post, such as categorizing income redistribution as tax relief, and focus on her claim that the legislation created at least 1.5 million new jobs when total employment has dropped by 3 million. Romer is not bad at math. Instead, she is saying that the economy would have lost 4.5 without the $787 billion increase in government spending. This what-might-have-been analysis is completely legitimate, assuming that there is good theory and evidence to back the assertion. Unfortunately (at least for the White House’s credibility), Ms. Romer and another colleague last year prepared a supposedly rigorous what-might-have-been report, where they estimated that the so-called stimulus would keep the unemployment rate at 8 percent and that failure to increase the burden of government spending would drive the unemployment rate to 9 percent. Yet as this chart from their paper indicates, when we add in the data for what actually has happened, in turns out that bigger government is not only theoretically misguided, but it also doesn’t work in the real world.

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According to a new article from the Mackinac Center, Michigan has below-average income compared to other states. But even though it is in 37th place for per-capita income, the politicians in the state are currying favor with union bosses by paying the 8th-highest teacher salaries:

The president of the Michigan Education Association stated on the radio recently that school employees have “given and given and given and given.” Comparing teacher salaries to personal income demonstrates that the taxpayers who pay for teacher salaries have “given” a lot more. The National Education Association just released its annual report that compares average teacher salaries throughout the country. For 2009-2010, Michigan ranks 8th. …Public school teachers are government employees and are paid with tax dollars, and therefore their wages are inextricably linked to the economic well-being of the state and the wealth of its citizens. …Michigan has many difficult decisions ahead, especially if Lansing continues its failed economic policies. Based on the numbers above, one issue that must be addressed is whether Michigan can continue to pay teachers “rich state” wages while the taxpayers footing the bill have “poor state” incomes.

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If you want to get depressed or angry, the New York Times has an article celebrating the effort by politicians at all levels of government to lure more people into the food stamp program. New York City is running ads in foreign languagues asking people to stick their snouts in the public trough. The City is even signing up prisoners when they get out of jail. The state of New York, meanwhile, actually set up quotas for enrolling new recipients. And on the federal level, there apparently is a program that gives states “bonuses” for putting more people on the dole. No wonder one out of every eight Americans is receiving food stamps. By the way, this is not just the fault of Democrats. The ranking Republican on the Agriculture Committee is a big defender of the program, in part because of the sordid pact among urban and rural politicians to support each other’s handouts. And President George W. Bush’s food stamp administrator actually had the gall to assert “food stamps is not welfare.” No wonder the burden of federal spending skyrocketed during the reign of so-called compassionate conservatism. The correct policy, of course, is to get the federal government out of the welfare business. If Mayor Bloomberg thinks it is a “civic duty” to expand food stamps, he should see whether New York City voters agree with him – and want to foot the bill.

A decade ago, New York City officials were so reluctant to give out food stamps, they made people register one day and return the next just to get an application. The welfare commissioner said the program caused dependency and the poor were “better off” without it. Now the city urges the needy to seek aid (in languages from Albanian to Yiddish). Neighborhood groups recruit clients at churches and grocery stores, with materials that all but proclaim a civic duty to apply — to “help New York farmers, grocers, and businesses.” There is even a program on Rikers Island to enroll inmates leaving the jail. “Applying for food stamps is easier than ever,” city posters say. …These changes, combined with soaring unemployment, have pushed enrollment to record highs, with one in eight Americans now getting aid. “I’ve seen a remarkable shift,” said Senator Richard G. Lugar, an Indiana Republican and prominent food stamp supporter. “People now see that it’s necessary to have a strong food stamp program.” …The program has commercial allies, in farmers and grocery stores, and it got an unexpected boost from President George W. Bush, whose food stamp administrator, Eric Bost, proved an ardent supporter. “I assure you, food stamps is not welfare,” Mr. Bost said in a recent interview. Still, some critics see it as welfare in disguise and advocate more restraints. …The federal government now gives bonuses to states that enroll the most eligible people. …In 2008, the program got an upbeat new name: the Supplemental Nutrition Assistance Program — SNAP. …Since Mayor Michael R. Bloomberg took office eight years ago, the rolls have doubled, to 1.6 million people… Albany made a parallel push to enroll the working poor, setting an explicit goal for caseload growth. “This is all federal money — it drives dollars to local economies,” said Russell Sykes, a senior program official. But Mr. Turner, now a consultant in Milwaukee, warns that the aid encourages the poor to work less and therefore remain in need. “It’s going to be very difficult with large swaths of the lower middle class tasting the fruits of dependency to be weaned from this,” he said.

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Since we’ve been talking about the snow, here’s a story about city that must have no real crime. At least, that’s the only sensible thing to conclude after reading that cops in Harrisonburg, VA, arrested (on felony charges!) two college kids for the horrific offense of tossing snowballs (technically they were charged with “throwing a missile at an occupied vehicle”). This would be understandable if the kids embedded rocks in the snowballs, or even if they compacted slush to make ice balls, which also can be dangerous. But the city’s press release offered no evidence of anything other than kids having fun. The Smoking Gun has the details:

Felony snowball throwing charges have been leveled against two Virginia college students for allegedly pelting a city plow and an undercover police car during Saturday’s blizzard. Charles Gill and Ryan Knight, both 21, were nabbed by cops in Harrisonburg, where they attend James Madison University. According to police, the pair first targeted a city plow last Saturday afternoon. …If convicted of the felonious snowball tossing, the men each face between one and five years in prison, and a maximum $2,500 fine.

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For the fourth day in a row, the federal government is shut down because of snow. This causes me mixed feelings. Because federal workers already are so vastly overpaid, part of me is irritated that they are getting what are, for all intents and purposes, extra vacation days. On the other hand, isn’t it better to have bureaucrats sitting at home instead of hunched over their desks figuring out new ways to tax and regulate? And let’s not forget that Harry Reid has been forced to delay the so-called jobs bill because of the snow, so the economy at least will be temporarily spared this new stimulus scam. But then I saw a story that it costs $100 million for each day the government is shut down. This perplexed me. While I have great faith in the ability of government to waste money, how could it cost even more for bureaucrats to stay home? It turns out this number is fake. As the story excerpted below indicates, the $100 million figure is a government estimate of “lost productivity.” For people in the real world, however, fewer IRS audits, fewer OSHA inspections, and fewer Dept. of Energy subsidies translate into higher productivity:

While D.C. residents take out their snow shovels for untold hours of back-breaking labor, the Office of Personnel Management estimates that the shuttering of the federal government is breaking the bank as well — costing taxpayers about $100 million every day in lost productivity, or work that’s not getting done. With Friday’s half day, and three full days of government shut-down this week, that adds up to $350 million — and it could top $500 million if the government, with its 230,000 D.C.-area employees, remains closed through the end of the week.

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Insanity is sometimes defined as doing the same thing over and over again while expecting a different result. On this basis the Euro-statists are clinically over the edge. They keep centralizing more power in Brussels and then they complain that European economies remain stagnant. On this basis, the new EU President must have escaped from the sanitarium, because he is asking for “economic government.” This means, not surprisingly, more power for Brussels to harmonize and regulate in hopes of creating the imaginary nirvana of a competitive social model. But I have to admire the perseverance of the “federalists,” as they are known. Every time they expand power, such as the recent Lisbon Treaty (basically a sanitized version of the statist EU constitution), they claim that they don’t intend to push for more centralization. Yet the ink is barely dry on one agreement before they start pushing for more powers. You would think European citizens would wake up to this boy-who-cried-wolf scam, but since the “European project” is fundamentally anti-democratic, most of them have ceased paying attention.

The European Union’s new president, Herman Van Rompuy, is calling for an “economic government” for the bloc, with closer policy coordination and financial incentives for good performers. …”Whether it is called coordination of policies or economic government,” only the European nations working are “capable of delivering and sustaining a common European strategy for more growth and more jobs,” he underlined. …The evocation of a European “economic government” will please France which has lobbied in this direction for years without success. …Thursday’s summit will also will also prepare the ground for a new EU economic strategy, focussing on investing in research, innovation and the green economy. This will replace the bloc’s Lisbon Strategy launched in 2000. The ambitious Lisbon Strategy was supposed to make Europe’s economy the most competitive and dynamic in the world. It failed to do so and Van Rompuy was happy to bury it. …For Van Rompuy it the matter is urgent and strikes at the very heart of the European project. …”Our structural growth rate is not high enough to create jobs and sustain our social model,” he warned.

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The fiscal crisis in Greece is fascinating political theater, in part because the Balkan nation is a leading indicator for what will probably happen in many other countries. The most puzzling feature of the crisis is the assumption in other European capitals, discussed in the BBC article below, that a Greek default is the worst possible result. It certainly would not be good news, especially for investors who thought it was safe to lend money to the government, but there are several reasons why the long-term pain resulting from a bailout would be even worse.

1. Bailing out Greece will reward over-spending politicians and make future fiscal crises more likely. In a four-year period between 2005 and 2009, Greek politicians expanded the burden of government spending from an already excessive level of 43.8 percent of GDP to an even more excessive level of 51.3 percent of GDP. Subsidies are rampant, the public sector is bloated, civil service pay is way too high, and entitlements are wildly unsustainable. A fiscal crisis – with no escape options – is probably the only hope of reversing these disastrous policies. So why, then, would it make sense for Germany and other nations to provide an escape option?

2. Bailing out Greece will reward greedy and short-sighted interest groups, particularly overpaid government workers. Greece is in trouble because the the people riding in society’s wagon assumed that there would always be enough chumps to pull the wagon. In reality, Greece is turning into a real-world version of Atlas Shrugged. Government has become such a burden that the job creators and wealth generators have given up and/or moved their money out of the country. Should taxpayers in other nations reward the greed and narcissism of Greece’s interest groups by being forced to pull the wagon instead?

3. Bailing out Greece will encourage profligacy in Spain, Italy, and other nations. The hot acronym in public finance circles is PIIGS, which is shorthand for Portugal, Ireland, Italy, Greece, and Spain. Greece is getting all the attention now, but these other countries have the same problems of excessive spending, bloated and dysfunctional public sectors, and unsustainable finances. What happens in Greece will send a very clear signal to the politicians in these nations, much as a parent who lets the oldest child run rampant is sending signals the younger siblings. Does anybody doubt that a bailout of Greece will discourage the other PIIGS from undertaking needed reforms?

4. Bailing out Greece is not necessary to save the euro. This is the most puzzling feature of this Greek tragedy (sorry, I couldn’t resist). There is a pervasive assumption that a default somehow would cripple the common currency of most European Union nations. But why would a default in Greece undermine the euro? If California went under, after all, that would not cripple the US dollar. There are unpleasant things that would probably happen following a Greek default, but the stability and strength of a currency is a function of central bank behavior. And so long as the European Central Bank does not crank up the proverbial printing press to monetize Greece’s debt, the euro should be fine.

In my darker moments, I have sometimes warned audiences of what will happen when a majority of voters in a country or a state become dependent on government. In such an environment, it obviously becomes much more difficult to put together an electoral coalition that will lead to fiscal changes that shrink the burden of government and curtail the predatory state. This is what has happened to Greece, and what is soon going to happen in other European nations (and, barring reform, what will eventually happen in the United States). The irony of this situation is that even the folks riding in the wagon should favor reform. After all, a parasite needs a healthy host.

For background info, here’s an excerpt from the BBC article:

Despite heavy rain, there have been rallies across Greece throughout the day, with thousands of striking workers and pensioners gathering in the capital, Athens. Several thousand people were also reported to have protested in Greece’s second city, Thessaloniki. The rallies have been mainly peaceful, but in one incident police fired tear gas at rubbish collectors who tried to drive through a police cordon. …The unions regard the austerity programme as a declaration of war against the working and middle classes, the BBC’s Malcolm Brabant reports from the capital. He says their resolve is strengthened by their belief that this crisis has been engineered by external forces, such as international speculators and European central bankers. “It’s a war against workers and we will answer with war, with constant struggles until this policy is overturned,” said Christos Katsiotis, a union member affiliated to the Communist Party, at the Athens rally. …On Tuesday, Prime Minister George Papandreou’s socialist government announced that it intends to raise the average retirement age from 61 to 63 by 2015 in a bid to save the cash-strapped pensions system. …Mr Papandreou has already faced down a three-week protest by farmers demanding higher government subsidies. …The markets remain sceptical that Greece will be able to pay its debts and many investors believe the country will have to be bailed out. The uncertainty has recently buffeted the euro and the problems have extended to Spain and Portugal, which are also struggling with their deficits. The possibility of Greece or one of the other stricken countries being unable to pay its debts – and either needing an EU bailout or having to abandon the euro – has been called the biggest threat yet to the single currency. Ahead of the talks between EU leaders in Brussels on Thursday, some business media reported that Germany is preparing to lead a possible bail-out, supported by France and other eurozone members.

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I’m not sure if this is better or worse than the infamous Bridge to Nowhere, but the U.K. government has been spending millions of dollars in a futile effort to exterminate a duck. And because they are relying on government bureaucrats to kill the ducks, the cost-per-dead-duck is well over $750. I would suggest that they simply offer regular citizens a $50 bounty on each dead duck, but that might not work since the government has banned private gun ownership. Not surprisingly, this foolish program was instigated by the bureaucrats at the European Commission. Here’s a report from the Daily Telegraph:

For five years it has been subject to a ruthless European Union-inspired campaign of extermination. But now the ruddy duck could be about to have the last laugh. …The cull was supposed to have been completed this year, but despite the killing of 6,200 ruddy ducks, the population is starting to increase again. …And while the British government has been trying to kill off its population, ruddy ducks in Holland and France have grown in number, undermining the British effort. …Lee Evans, from the British Birding Association, said: “It is a pointless farce. They will never be able to kill every last bird. …“The cull has been a complete and utter waste of money because the government would have to kill every one and there is no possibility of that.” …The five year project to kill off the ruddy duck, co-ordinated by the Department for Environment, Food and Rural Affairs (Defra), is due to finish this summer. But 687 birds are still alive in the UK, up from an estimated 400 to 500 two years ago. …Andrew Tyler, director of Animal Aid, said: “This has been a completely hopeless slaughter. The whole premise is nonsense, as well as the logistics, and it has also been extraordinarily expensive. “The birds from Britain don’t seem to be going to Spain anyway, but even if ruddies are breeding with white headed ducks, that is a natural hybridisation that occurs in many birds.” …At one shoot earlier this month, an estimated 12 Defra officials, in eight boats, killed a total of 14 ducks on Ibsley Water, near the New Forest. …Half the cost of the UK’s £3.3 million ruddy duck cull has been met by the EU, with the other half provided by Defra. It follows earlier research by the department into eradicating ruddy ducks, said to have cost a further £1.3 million.

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My Cato colleague Izzy Santa explains why a free-market approach is the key to better schools.

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Arizona was hit hard by the housing bubble and that is causing considerable headaches for politicians – particularly since they allowed spending to explode during the boom years. Phoenix could be a poster child for this version of fiscal excess. The city budget grew by nearly 10 percent annually when revenues were buoyant, in part because government employees have compensation that is almost twice as high as workers in the productive sector of the economy:

Phoenix City Councilman Sal DiCiccio has pointed out that the average cost for a Phoenix city employee is $100,000. In just the past six years, the City of Phoenix budget grew by 59.6 percent, more than double the sum of inflation and population growth. …Clearly, there is a failure by the City of Phoenix to address fundamental reform in the face of shrinking tax revenues. Public safety should be the city’s first priority for funding, not an afterthought that depends on the promise of additional taxes. Many of the funds in the city’s total budget are dedicated for various purposes such as public art.

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Political Humor

Perfect for next year’s State-of-the-Union address…or just about any other political speech. Not sure why I can’t get the picture to show up (at least on my computer), but you’ll see it if you click on the box. Amusing.

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Here’s another study showing the benefits of comprehensive school choice in a foreign country. Interestingly, the author of the report about the Chilean system clearly is not a fan of competition, yet even his data shows higher scores for private schools and rising overall scores, even in the government schools – which is exactly what one would expect since competition encourages every type of school to do a better job:

Chile’s education system was decentralized in 1980, and a voucher-type subsidy was introduced to encourage private providers to enter the market. …Following the reform…, the subsidized private sector rapidly expanded…with 56 percent of enrollments in the municipal sector and 34 percent in subsidized private schools. The fee-paying private sector has expanded…to account for 10 percent of total enrollment. …test results have tended to improve over time, especially at 4th grade, but there are significant differences…fee-paying private schools on average score 19 more points than municipal schools in the SIMCE test, whereas subsidized private schools score 4.5 more.

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It’s almost amusing to see the Securities and Exchange Commission jumping on the sinking ship of global warming alarmism. After all, only a government bureaucracy would take such a step at precisely the moment that the scam has been exposed. But I said it’s “almost amusing” because the added costs imposed on companies will be real, and this will hurt workers, shareholders, and consumers. But I will tip my proverbial hat to the Democrats. I remember several years ago trying to get the SEC to give shareholders more accurate information by having dividend checks show that corporate tax already was paid on the money. This would help people realize, of course, that declaring dividend income on personal tax returns was a punitive form of double taxation. Yet even though this was squarely in the SEC’s mission of supposedly serving investors, the Republicans in charge were politely dismissive. The moment Democrats get in charge, however, they move forward with a politically-motivated change that has nothing to do with helping investors. This is a good example of the old saying that Republicans are the stupid party and Democrats are the evil party:

A politically divided Securities and Exchange Commission voted on Wednesday to make clear when companies must provide information to investors about the business risks associated with climate change. The commission, in a 3 to 2 vote, decided to require that companies disclose in their public filings the impact of climate change on their businesses — from new regulations or legislation they may face domestically or abroad to potential changes in economic trends or physical risks to a company. Chairman Mary L. Schapiro and the two Democrats on the commission supported the new requirements, while the two Republicans vehemently opposed them. “I can only conclude that the purpose of this release is to place the imprimatur of the commission on the agenda of the social and environmental policy lobby, an agenda that falls outside of our expertise and beyond our fundamental mission of investor protection,” Republican commissioner Kathleen L. Casey said.

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