Posts Tagged ‘ unemployment ’

Surprise, Surprise. . .The universal laws of economics are still alive!

I know it’s been a while since I last wrote to you, but at some point, I felt as though I had made my case and the need for a daily chronicle of how we were doing everything wrong was draining on me and pointless for you. I write today to add fuel to a growing fire. As elections loom and the country seems to have had enough with the depressed economic situation we find ourselves in, it’s time to compare our plight with those who have taken a different course.

Last year I wrote an article about the enormous amount of government programs the new administration was passing through. They were spending like there was no tomorrow, telling us all the while that government was the only one who could get us out of this mess. The private sector had tried and failed. The article was “That’s Great, but what do you do for an encore.” Feel free to take time to read it now if you like. . .I’ll wait. . .OK, done? I liked to turn your attention to the massive THROW DOWN I issued to Germany and Hungary. While we are spending like crazy, those two countries decided to cut taxes. Not much mind you. But cut they did. I told Germany and Hungary IT. . .IS. . .ON!!! Let’s see if spending beats cutting. . .you know. . .for like. . .the first time. . .EVER! Come on America, we can do it this time!

A year has passed and let’s check the report card. Continue reading

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Democrats defy logic and the public

At least we see people are starting to get it.  Unfortunately, the administration looks at polls and dismisses them.  They are undounted.  Let’s review:  Health care that will raise a family’s health insurance cost while at the same time requiring that coverage under penalty of prison is not welcome by the American public.  The administration and the leadership in Congress flip America the bird and push harder.  Global warming is revealed to be a hoax complete with intentionally destroyed data and explicit written evidence of number tampering.  Does the Administration pause and investigate?  No they defiantly press harder, seeking an international treaty that would crush what’s left of American industry, impose a global tax on Americans, then pour salt on U.S. industry by announcing CO² a hazardous waste to be regulated. Stand-by for the breathing tax, trust me it’s coming. Meanwhile unemployment remains in the double digits.  Does any of this create jobs for Americans?  Not really.

I’ll give Obama kudos, he does not craft his agenda by following polls.  President Clinton seemed obsessed, chasing  polls, however Obama seems obsessed by ideological fervor.  I’ve heard him called an empty suit and while I have not come to any solid conclusion on that, I doubt it.  I do believe he is a front man for greater powers, but I think he is completely in line with those who sponsor him.  He has a clear agenda to socialize America.  He was raised and mentored by communists, by his own admission he chose to associate himself with radicals and communist professors while in college, why then should it surprise anyone when his administrative agenda is aggressively socialist?

I’ll answer that.  I believe it is due to two things.  Continue reading

What America Needs Now Is Job Creation

The Administration is using a faulty model

The Obama Administration can talk about saving jobs until they are blue in the face.  They can tell us they created a million new jobs – no wait, why not tell us it’s five million, it doesn’t matter what the number is.  As someone I admire once said, “Facts are stubborn things,”  10.2% vs. the promised 7.8%.  Phony job creation claims do not improve the unemployment numbers.  I don’t know about you, but I am nearly depressed every time I see the latest unemployment figures.  10.2% only counts those actively looking for work.  The situation is so desperate that many people are simply too depressed and despondent to continue looking.  They’re still unemployed but they are no longer counted in the official statistics.  Arriving at the true unemployment numbers can be a bit of an art rather than pure science.  According to the New York Times, true unemployment now stands at 17.5%, nearly a half percent higher than the previous record set in 1982.  And there is no sign the trend has reversed.  It will likely climb ever higher.

In the early 1980s the Reagan administration countered the Carter recession by encouraging new business.  New businesses hire new employees.  The Kauffman Foundation released a study Nov. 5th illustrating this fact.  The study shows that since 2007, two-thirds of all new jobs were created by companies less than five years old.  Contrary to current Washington thinking, these jobs are not public sector jobs, temporary jobs, or welfare entitlements.  Job creation that benefits the nation comes from companies employing people with the express purpose of making money for themselves and their employees.  Making money motivates job creation.  Imagine that!

A maxim that accurately defines the federal government’s role in managing the economy is, if you want to discourage a behavior tax it, if you want to encourage a behavior offer a tax credit.  Instead we have a government that adheres to another maxim, “If it moves, tax it. If it keeps moving, regulate it. And if it stops moving, subsidize it.” Or more accurately, nationalize it.

The economy has stopped moving and all we see is from our huge stimulus package are temporary jobs and a continuing rise in unemployment.  Big established companies are receiving billions in bailout money and for what?  Are they hiring?  Are they even maintaining their employees?  No they are only continuing to be mismanaged by overpaid and persecuted CEO’s, corrupt boards, and now, meddling Czars.  It would have done more good to have evenly divided that money between all the unemployed people and sent out checks.  At least some mortgages and car payments would have been paid.

New ventures, small new ventures, are the fuel for the economic engine.  Washington, OBAMA, yo, how about encouraging new business?  Maybe even a bit of protection against foreign threats, definitely low interest loans to start-ups, decrease business taxes, and enact tax credits for companies hiring new employees.  This phoney job creation has to end.  If you don’t want to preside over the Second Great Depression, do something constructive, something that grows jobs and rebuilds the economy.  Stop pursuing new government bureaucracies that only suck more money out of the economy.  Stop seeking more government control that only inhibits the economy.  Do not engage in any action that would slow or stop economic productivity.  Be a positive factor in the economy by protecting and encouraging growth and new business ventures.

Mr. President, look at your models, then look at the actual economy since you took office.  Are your models accurate?  Are they within an acceptable margin of error?  If the answer is no, then you must reject those models and embrace new ones.  Partisan politics are what got us here and you continue to play that game.  We, the people, are sick of it.  You promised change.  We voted for positive change and have only received radical negative change.  You seem more concerned about political ideology than actually helping people find employment.  Employed people pay taxes, unemployed people consume tax revenues.  Want to increase revenues for the government?  Encourage new business, encourage real job creation in the private sector.

It is not working and you must change.  As for those in Congress, your days are numbered.  Change or be changed.  Government cannot create jobs, but they can create an environment conducive to job creation.

outrAIGeous outrage

outrAIGeous outrage

Just since Sunday, I have read at least a hundred blog entries concerning AIG, perhaps two or three dozen different newspaper stories, original source material such as Edward Liddy’s letter to the White House, and the CDS list.  The blogosphere is ablaze with more rage and hatred toward AIG than I have ever seen – even more than the outrage Enron created.  We have reasons to be angry and I don’t need to reiterate them here.  Anyone who has read my take on this issue knows I am just as outraged at AIG as the next person, but I find Americans are reacting primarily from their gut on this topic.

If Americans were truly outraged at having a portion of their tax money wasted, they would demonstrate outrage every time Congress submits a budget filled with pork projects.  Pork projects are a waste of taxpayer money.  Recently we saw a budget signed into law that contained $8 billion in wasteful spending.  Only a few people were outraged – mostly Republicans and Conservatives (they aren’t the same anymore.)  The pork amounted to 2% of the budget.  The AIG bonuses amount to 0.3% of the bailout money.  So when you wave your hand in imitation of Barack, dismissing the pork as insignificant, recall how angry you became when AIG wasted 0.3% of your money.  Just something for you to think about.

THE SUBCOMMITTEE

Today a House subcommittee (House Financial Services Subcommittee on Capital Markets,) became the focus of national attention when it began hearings on AIG.  Normally subcommittees attract very little attention.  During the hearing, the Representatives spewed their hypocritical indignation for more than an hour.  Code Pink showed up bearing sign demanding AIG employees be jailed.  At least one blogger demanded that AIG employees be brutally beaten and killed in the streets.  (I figured he was joking but soon his comments were filled by enthusiastic agreement.) Moreover, Senator Charles Grassley (R-IA) suggested that AIG executives should commit suicide!


Has our society really broken down to this – hatred so intense that we wish violence on those who disagree or offend us?  America was not founded on hatred.  Yes, AIG ripped us off.  Nevertheless, every year your government rips you off for far more and none of you damn cows so much as moos.

AIG AIN’T THE ONLY BAILED OUT COMPANY PASSING OUT BONUSES

Meanwhile a couple of other bailed out messes are getting ready to dole out bonuses and most of you know nothing about it.  I am talking about Fannie Mae and Freddie Mac. Once again, I must ask, what has anyone at Fannie or Freddie done to deserve a bonus?  Nothing they ran a sinking ship.  Why did these losers need a bailout?  Subprime loans.  These loans were made primarily due to social engineering policies at Freddie and Fannie, encouraged by ACORN and the Democrats in Congress.

While our hard earned tax dollars are being passed out like free party favors at two unhealthy lending institutions the Federal Housing Authority tells reporters, “it’s a reasonable and well-thought out plan … The most important thing in those companies are the human assets … It would have been catastrophic if people had walked out…”  Reuter’s reporter Patrick Rucker seems to sympathize with Fannie and Freddie employees noting, “Many company employees lost large sums as the value of Fannie Mae and Freddie Mac shares collapsed when the companies were seized.”  Unfortunately, in companies where bailouts were not received, employees also lost large sums as their companies lost value, but there was no money in the company coffers to provide bonuses to compensate them.  No these unlucky folks instead have to pay for bonuses at Fannie and Freddie.  Furthermore, in this economy, where banks are consolidating and going bust faster than changing weather, who is going to quit because they didn’t get a bonus?

MANIPULATED MASSES

So where is your outrage folks?  I think the anger will all depend on how the President and the media react.  AIG is a huge insurance company that has swallowed up $180 billion in taxpayer bailout money.  When the arrogant CEO defended doling out that money to the people responsible for ruining the company, he made an easy target.  He represented evil corporate America.  Naturally, the President was quick to respond and denounce AIG.  On the other hand, Fannie and Freddie are the darlings of Congress.  Yes, they gobbled up billions in taxpayer money (Freddie has received $45 billion and will likely be requesting more,) however, Democrats have a lot invested in them.  Unless the news media gets angry about the bonuses at these enterprises, expect only mild objections.

EASY SOLUTION – SLOW TO ARRIVE

On Monday, I heard water cooler talk about how the contracts were unbreakable and how Congress should tax the bonuses.  It occurred to me that the solution was simple and AIG CEO, Edward Liddy should have arrived at it prior to the publicity.  Liddy should have issued a memo to his bonus receiving staff demanding they sign a letter refusing the bonus.  He should have explained, as recipients of the largest public bailout in history, these bonuses would touch off a firestorm of criticism and jeopardize future assistance the company might require. Unfortunately, for everyone, he was either too arrogant or too ignorant to come up with this on his own before Sunday.

Today under tremendous pressure from all sides, Liddy, asked his employees to return at least half of the awarded bonuses.  I don’t know about you, but my wife would have had that money spent the day it hit the bank.  It’s much easier and politically correct to do the right thing in the first place.

Who will pay?

The Obama administration and those idiots in Congress are on a spending spree like this nation has never seen before.  They are spending faster than a drunk in a liquor store.  The debt they are incurring will not likely be paid back even when in our great-grandchildren retire.  In fact, I fear, this spending spree may trigger a national default before sooner rather than later.  (Perhaps sooner than 2020.)  I have great difficulty understanding what the President might have been thinking when he said we had the responsibility “to ensure that we do not pass on to [our children] a debt that they cannot pay.”  The morons in Congress enthusiastically applauded but did they hear anything?  Hello?  What the hell are they doing if not exactly that. It isn’t getting better either.  President Obama is proposing a 2010 budget that is nearing the entire income of the wealthiest 2% – $3.5 TRILLION.  That’s before earmarks!  (If you, like most people, can’t even imagine what a trillion dollars really looks like, click here!)

Maybe I heard wrong.  Did the President say he did not want anymore earmarks?  I believe the quote was, “sacrifice some worthy priorities for which there are no dollars,” Did the House then pass a budget with 8600 earmarks ($7.7 Billion) the next day?  Did Obama threaten to veto it?  No, I cannot even find a story that quotes him as opposing it.  Perhaps the most outrageous claim I read in the Detroit Free Press story was when House Rules Committee Chairman Louise Slaughter, D-N.Y. said this budget has nothing to do with Obama but rather, “This has to do with President Bush’s budget.” I suppose this gives them a blank check since Bush will not be around to sign it, yet somehow in their warped logic it is his budget.  There is a term I’d apply to Ms. Slaughter, but I’ll stick to “idiot”, the meaning is the same.

nomoreearmarksI want to start a protest campaign.  We should all fax our senators a photo of an ear with the caption, “NO MORE EARMARKS!” These people are IDIOTS!  I am angry about this.  The trouble is getting worse NOT better.  Watching CNN yesterday I heard one interviewed Representative say earmarks were a necessary part of the stimulus package.  In the vernacular of the web, OMG!  Furthermore, the Justice Department is investigating likely connections between earmarks and campaign contributions.  I present as evidence that the House killed a proposal by Representative Jeff Flake, R-AZ, calling on the House ethics committee to investigate such connections, by a vote of 226 to 182.  I’m faxing an ear.  Moving on.

If you are one of those who thinks the rich will carry the burden of this stimulus and the coming health-care system you need to put down your crack pipe, pull off the rose-colored glasses, screw the cap back on the beer bottle, and wake up to reality.  Everyone wants free stuff.  Everyone expects someone else to pay.  There are always people out there who are overpaid and under-taxed but it is never us.  We are always under-paid and overtaxed and it’s about time someone else pays “their fair share.” Well guess what?  Right now, the wealthiest 1% of Americans pay 40% of all taxes paid yet they only earn 22% of all the money earned.  Even if we took their entire combined income there would not be enough money to cover this year’s budget.  So, if you just love Obama and can’t wait for the new national health-care system, hold on to your wallet.  You thought health insurance was expensive before?  Wait until you see your pay check.  The best part is you likely won’t be able to opt out.

There is a very good editorial in the Wall Street Journal that I want everyone to read.  I had begun to steam about this topic after I decided to see if there was enough money in the U.S. economy to fund this massive deficit and ensuing debt.  When I found this wonderful editorial I decided to stop right here and reproduce it here.

___________________________

The 2% Illusion

Take everything they earn, and it still won’t be enough.

President Obama has laid out the most ambitious and expensive domestic agenda since LBJ, and now all he has to do is figure out how to pay for it. On Tuesday, he left the impression that we need merely end “tax breaks for the wealthiest 2% of Americans,” and he promised that households earning less than $250,000 won’t see their taxes increased by “one single dime.”

[Review & Outlook]

This is going to be some trick. Even the most basic inspection of the IRS income tax statistics shows that raising taxes on the salaries, dividends and capital gains of those making more than $250,000 can’t possibly raise enough revenue to fund Mr. Obama’s new spending ambitions.

Consider the IRS data for 2006, the most recent year that such tax data are available and a good year for the economy and “the wealthiest 2%.” Roughly 3.8 million filers had adjusted gross incomes above $200,000 in 2006. (That’s about 7% of all returns; the data aren’t broken down at the $250,000 point.) These people paid about $522 billion in income taxes, or roughly 62% of all federal individual income receipts. The richest 1% — about 1.65 million filers making above $388,806 — paid some $408 billion, or 39.9% of all income tax revenues, while earning about 22% of all reported U.S. income.

Note that federal income taxes are already “progressive” with a 35% top marginal rate, and that Mr. Obama is (so far) proposing to raise it only to 39.6%, plus another two percentage points in hidden deduction phase-outs. He’d also raise capital gains and dividend rates, but those both yield far less revenue than the income tax. These combined increases won’t come close to raising the hundreds of billions of dollars in revenue that Mr. Obama is going to need.

But let’s not stop at a 42% top rate; as a thought experiment, let’s go all the way. A tax policy that confiscated 100% of the taxable income of everyone in America earning over $500,000 in 2006 would only have given Congress an extra $1.3 trillion in revenue. That’s less than half the 2006 federal budget of $2.7 trillion and looks tiny compared to the more than $4 trillion Congress will spend in fiscal 2010. Even taking every taxable “dime” of everyone earning more than $75,000 in 2006 would have barely yielded enough to cover that $4 trillion.

Fast forward to this year (and 2010) when the Wall Street meltdown and recession are going to mean far few taxpayers earning more than $500,000. Profits are plunging, businesses are cutting or eliminating dividends, hedge funds are rolling up, and, most of all, capital nationwide is on strike. Raising taxes now will thus yield far less revenue than it would have in 2006.

Mr. Obama is of course counting on an economic recovery. And he’s also assuming along with the new liberal economic consensus that taxes don’t matter to growth or job creation. The truth, though, is that they do. Small- and medium-sized businesses are the nation’s primary employers, and lower individual tax rates have induced thousands of them to shift from filing under the corporate tax system to the individual system, often as limited liability companies or Subchapter S corporations. The Tax Foundation calculates that merely restoring the higher, Clinton-era tax rates on the top two brackets would hit 45% to 55% of small-business income, depending on how inclusively “small business” is defined. These owners will find a way to declare less taxable income.

The bottom line is that Mr. Obama is selling the country on a 2% illusion. Unwinding the U.S. commitment in Iraq and allowing the Bush tax cuts to expire can’t possibly pay for his agenda. Taxes on the not-so-rich will need to rise as well.

On that point, by the way, it’s unclear why Mr. Obama thinks his climate-change scheme won’t hit all Americans with higher taxes. Selling the right to emit greenhouse gases amounts to a steep new tax on most types of energy and, therefore, on all Americans who use energy. There’s a reason that Charlie Rangel’s Ways and Means panel, which writes tax law, is holding hearings this week on cap-and-trade regulation.

Mr. Obama is very good at portraying his agenda as nothing more than center-left pragmatism. But pragmatists don’t ignore the data. And the reality is that the only way to pay for Mr. Obama’s ambitions is to reach ever deeper into the pockets of the American middle class.  –wsj

The only thing we have to fear is…

Fear will kill you

If you have read my essays on Free Trade you will know that I believe the source of America’s economic weakness comes from outside the country.  Sure, the banking and housing crisis played roles but Free Trade policies are causing permanent damage.  As long as American companies employ Americans they are disadvantaged to those who don’t.   Not only do foreign companies not pay U.S. wages but they are exempt from U.S. corporate taxes.  Corporate taxes in the United States range from 35% to a top end of 41.6%.  The top end is greater than Japan’s 40% rate.  Do you understand why American businesses outsource?  They have to.

The Tax Foundation reported that the United States would need to reduce corporate taxes 20% just to rank in the middle of the international pack.  It would be an unrealistic expectation for this Democratically controlled government to cut corporate taxes like this.  It would be like asking a child to voluntarily give up candy – permanently.

No, we can expect them to fund the non-stimulus programs by increasing rather than decreasing corporate taxes.  After all, businesses are the bad guys.  They do nothing for this nation except abuse employees and charge actual money for their goods and services.  As a rule, they tend not to engage in social engineering, and rarely do they give away all their money (or borrow money to give) to unproductive or worthless employees.  They actually demand something in return for their money.  This simply is not fair and such evil entities should be punished, right?  Wrong, of coarse.

I do not understand which economic theory the current administration is following.  (I have studied economics too.)  Someone explain how giving money, through tax credits, rebates, or outright handouts, stimulates the economy?  I thought this spurious when Bush did it and we received no results.  So why are we doing it again and in a bigger way?  When people are losing their jobs, they won’t take this money and run out to Best Buy and buy a new iPhone.  If they did this still would have little lasting effect on the economy, iPhones are made in China.

If they were serious about stimulating the economy they would encourage, through tax breaks and other incentives, new business opportunities, the hiring of new employees, or create disincentives for businesses that cut jobs or outsource overseas.  What about a tax break for companies who expand and a new tax on American companies who employ non-American third party vendors?  How about reducing the corporate tax from 35% to 25% and then add a corresponding excise fee on non-essential goods.  Currently we punish businesses who call America home and reward them for moving jobs overseas where they can benefit from lower taxes and virtual slave-labor;  AND we give huge tax breaks to foreign companies who export to us.

youareallidiotsThere is no such thing as “bottom up stimulus.”  The bottom doesn’t create jobs they consume resources unless they are employed.  Businesses employ people.  Employment enables the economy to work because people are producing to meet demand.  The fact that they are producing allows them to create demand.  Business is at the top and when they employ people they are stimulating the economy and in turn are being stimulated by it.  Reagan called this “trickle-down,” a term abused by the left and successfully made to insinuate that the money stays mostly at the top.  Today’s conservatives need to rename this, perhaps “top-down job creation.”

The U.S. government is funded 95% through payroll, corporate, and income taxes.  Every time a business sheds an employee the government loses tax revenue both from the employee and the business, furthermore they incur additional entitlement payments.  When businesses shutter the impact is greater.  “Bottom up” simply adds  to the government burden and does nothing to address the underlying issue.

Last week I discovered an undated corporate memo on another blog that I want to reproduce here.  (I attempted to verify its authenticity, but the author refused to respond.  Therefore I cannot be certain the memo is real, so if you work for this company, let me know.) The memo boldly paints a picture of a situation I believe will become commonplace if Democrats increase taxes to fund their stimulus, ah, social engineering plan.  This memo clearly illustrates what we have to fear and from whom the threat comes.

To All My Valued Employees,

There have been some rumblings around the office about the future of this company, and more specifically, your job. As you know, the economy has changed for the worse and presents many challenges.  However, the good news is this: The economy doesn’t pose a threat to your job. What does threaten your job however, is the changing political landscape in this country. However, let me tell you some little tidbits of fact which might help you decide what is in your best interest.

First, while it is easy to spew rhetoric that casts employers against employees, you have to understand that for every business owner there is a back story”. This back story is often neglected and overshadowed by what you see and hear. Sure, you see me park my Mercedes outside. You’ve seen my big home at last years Christmas party. I’m sure; all these flashy icons of luxury conjure up some idealized thoughts about my life. However, what you don’t see is the back story.

I started this company 28 years ago. At that time, I lived in a 300 square foot studio apartment for 3 years. My entire living
apartment was converted into an office so I could put forth 100% effort into building a company, which by the way, would eventually employ you. My diet consisted of Ramen Pride noodles because every dollar I spent went back into this company. I drove a rusty Toyota Corolla with a defective transmission. I didn’t have time to date. Often times, I stayed home on weekends, while my friends went out drinking and partying. In fact, I was married to my business — hard
work, discipline, and sacrifice. Meanwhile, my friends got jobs. They worked 40 hours a week and made a  modest $50K a year and spent every dime they earned. They drove flashy cars and lived in expensive homes and wore fancy designer
clothes.  Instead of hitting the Nordstrom’s for the latest hot fashion item, I was trolling through the Goodwill store extracting any clothing item that didn’t look like it was birthed in the 70’s. My friends refinanced their mortgages and lived a life of luxury. I, however, did not. I put my time, my money, and my life into a business with a vision that eventually, some day, I too, will be able to afford these luxuries my friends supposedly had.

So, while you physically arrive at the office at 9am, mentally check in at about noon, and then leave at 5pm, I don’t. There is no “off” button for me. When you leave the office, you are done and you have a weekend all to yourself. I unfortunately do not have the freedom. I eat and breathe this company every minute of the day. There is no rest. There is no weekend. There is no happy hour. Every day this business is attached to my hip like a 1 year old special-needs child. You, of course, only see the fruits of that garden — the nice house, the Mercedes, the vacations… You never realize the back story and the sacrifices I’ve made.

Now, the economy is falling apart and I, the guy that made all the right decisions and saved his money, have to bail-out all the people who didn’t. The people that overspent their pay checks suddenly feel entitled to the same luxuries that I earned and sacrificed a decade of my life for.

Yes, business ownership has its benefits but the price I’ve paid is steep and not without wounds. Unfortunately, the cost of running this business, and employing you, is starting to eclipse the threshold of marginal benefit and let me tell you why:

I am being taxed to death and the government thinks I don’t pay enough. I have state taxes. Federal taxes. Property taxes. Sales and use taxes. Payroll taxes. Workers compensation taxes.  Unemployment taxes. Taxes on taxes. I have to hire a tax man to manage all these taxes and then guess what? I have to pay taxes for employing him. Government mandates and regulations and all the accounting that goes with it, now occupy most of my time. On Oct 15th, I wrote a check to the US Treasury for $288,000 for quarterly taxes. You know what my “stimulus” check was? Zero. Nada. Zilch.

The question I have is this: Who is stimulating the economy? Me, the guy who has provided 14 people good paying jobs and serves over 2,200,000 people per year with a flourishing business? Or, the single mother sitting at home pregnant with her fourth child waiting for her next welfare check? Obviously, government feels the latter is the economic stimulus of this country.

The fact is, if I deducted (Read: Stole) 50% of your paycheck you’d quit and you wouldn’t work here. I mean, why should you? That’s nuts. Who wants to get rewarded only 50% of their hard work? Well, I agree which is why your job is in jeopardy.

Here is what many of you don’t understand … to stimulate the economy you need to stimulate what runs the economy. Had suddenly government mandated to me that I didn’t need to pay taxes, guess what? Instead of depositing that $288,000 into the Washington black-hole, I would have spent it, hired more employees, and generated substantial economic growth. My employees would have enjoyed the wealth of that tax cut in the form of promotions and better salaries. But you can forget it, now.

When you have a comatose man on the verge of death, you don’t defibrillate and shock his thumb, thinking that will bring him back to life, do you? Or, do you defibrillate his heart? Business is at the heart of America and always has been. To restart it, you must stimulate it, not kill it. Suddenly, the power brokers in Washington believe the poor of America are the essential drivers of the American economic engine. Nothing could be further from the truth and this is the type of change you can keep.

So where am I going with all this? It’s quite simple. If any new taxes are levied on me, or my company, my reaction will be swift and simple.  I fire you. I fire your co-workers. You can then plead with the government to pay for your mortgage, your SUV, and your child’s future. Frankly, it isn’t my problem any more. Then, I will close this company down, move to another country, and retire. You see, I’m done.  I’m done with a country that penalizes the productive and gives to the unproductive. My motivation to work and to provide jobs will be destroyed, and with it, will be my citizenship.

If you lose your job, it won’t be at the hands of the economy; it will be at the hands of a political hurricane that swept through this country, steamrolled the constitution, and will have changed its landscape forever. If that happens, you can find me sitting on a beach, retired, and with no employees to worry about….

Regards,

Mark Harger

Superior Mechanical Contractors

Do it for the CHILDREN

How can you say no to this?

I think most of us realize the government must do something to help fix the ailing economy.  Where we disagree is the details and as they say the Devil is in the details. My knee-jerk reaction to any politician trying to ram-rod legislation through is that there must be details they are trying to hide.  The more quickly they move a bill through the less the chance anyone will read it.  To make the plan fool-proof make sure the wording is flowery and verbose.  This bill stood at 1,434 pages as of early this morning.  Another security measure Pelosi is employing is to shut the opposition out of the process and not let them read the bill.

The Dictator(You know, I have stated my intention not to demonize my opponents.  I strive to assume good motives even when methods might be less than pure.  However, I cannot escape my deep down intense distrust of Pelosi.  In the past I have jokingly said she was Satan in a skirt but her actions, from turning the lights out on House Republicans during the gas crisis last August, to shutting Republicans out of the stimulus process, demonstrate to me that she has little in the way of good intentions.  But I digress.)

Unless you have been hiding under a log, and believe me I have wanted to do so a few times in recent months, you are aware that President Obama has been back on the campaign trail promoting this stimulus plan.  Today, I read, that the DNC and Obama’s own, Organizing for America, are using testimonies from selected supporters affected by the bad economy to promote the passage of the bill.  Now, I have a problem with this.  Not because I lack compassion for those affected by the economic downturn, but because anecdotal evidence is so easily manipulated and falsified.  Furthermore, the sole purpose of such stories is emotional manipulation and distraction from the real facts of the plan.  Simply put, will the plan work and is it an effective use of taxpayer monies.

As long as I have been voting politicians have used manipulation to push through taxes and other unpopular legislation.  The most effective tool in the emotional manipulation tool box is children.  I once joked to my friends that you could sell Americans on anything if you simply added the line, “it’s for the children” into the campaign rhetoric.  The Florida county I resided in during the 1980s once passed an unpopular gas tax by claiming it would help the children.  How many state lotteries have been championed with those words?  Logic be damned, it’s for the children!

Have families been displaced from their homes?  Yes, and that is very unfortunate.  How will the $789.2 billion bill help these poor people in the long-term?  This is perhaps the single most important fact and one that has been obfuscated by Democrats.  Can we truly know?  CNN, like other media sources has attempted to give voters an overview of what is in the plan.  The entire article is only 1150 words as compared to the 1,434 page bill, not even a word per page.  CNN’s Jeanne Sahadi has no clue what is in the plan and is relying on Congressional sources to summarize for her through various promotional press releases and such.   She emphasizes only the money being given away to the poor and fails to demonstrate one point that stimulates business.  (Makes sense since liberals are all excited about an upside down stimulus.)  The bill, as far as I can tell, seems to show a pandering to the poor and seems to attempt to create as many dependents as possible.  The following is based on my reading of the CNN and Wall Street Journal reports on the current package.  Feel free to correct me if my understanding is off on anything here.

$116.2 Billion for “Making work pay credit”. This provision “gives” (remember this is the employee’s money yet it is suggested the gov’t is giving the employee money) each “worker” making less than $75,000 regardless of whether the individual pays taxes or not, $400.  (Oh whatever happened to the $250,000 income cutoff we heard repeated so often during the campaign?  Right, as I predicted to my friends the final cut off was between $40 and $75k – so they came in at the top.)

$14.2 Billion for people who don’t work.  (Yes, you read that right.  They want to give each unemployed person whether they lost their job, are retired, disabled, or on crack, $250.  Nothing like buying votes.)

$69.8 Billion for people who might have to pay the Alternative Minimum Tax.  This tax applies to people who normally can afford it, or so the Democrats say, but it seems the tax has been affecting too many people in the lower upper class and hey, why not spread the love and buy a vote or two.  After all $70 billion ain’t so bad a price to pay.

$1.7 Billion comes in the form of allowing tax deductions for state and local taxes on qualifying vehicle purchases.  (Whoa, this is tantamount to a tax cut!  Surely it will be hailed as such and is in the WSJ account.  Wow, what a great auto industry bailout plan.  Sheez, this is useless.)

$6.6 Billion to expand the home buyer tax credit.  (But wait this money is for first-time buyers, how does this help?  Well, obviously it will encourage new home sales from yet more people who really cannot afford to be buying a home in the first place.  Right? After all, this applies only to households making less than $75k/$150k joint.)

$13.9 Billion for college tax credit.  (I am in favor of supporting and encouraging young people to go to college.  I don’t, however, like the provision for non-taxpayers to receive money from this without any qualification.  The CNN article seems to suggest a Hope Scholarship tie in but I don’t see a clear connection since the Hope has requirements, I don’t see requirements on the American Opportunity Tax Credit.)

$15.6 Billion to temporarily increase the Pell Grant by $500.

14.8 Billion to expand the child tax credit.  People earning as little as $3000 could claim this credit.  (Now am I not understanding this, doesn’t this mean these people who pay NO taxes will be receiving the full amount I can deduct as a refund?  This must be the bottom up stimulus Obama was referring to.)

$4.6 Billion to temporarily increase the earned income tax credit.  (Hey this is actually a tax reduction, however, temporary and limited to people who do not create jobs.)

$24.7 Billion in healthcare benefits to those who have lost their benefits.  (I doubt very much if this will stimulate the economy, but I do sympathize with those who have to pay those crazy COBRA insurance rates.)

$8.8 Billion for extended unemployment benefits.  (Again no stimulus to the economy but a compassionate move I can sympathize with at least.)

$19.9 to increase the food stamp program.  (I am truly conflicted on this program.  It is completely abused and broke but it has a good purpose.  Rather than expand it I’d like to see the program shutdown.  I’d like to see farm subsidies used to buy excess crops and government food ditributions direct to the needy rather than this food stamp program that lacks accountability.)

$2.75 Billion other aid to the needy.  (Again, no stimulus here.  I don’t oppose aid to the poor but in what I read I see little stimulating.)

$87 Billion in temporary Medicaid payments to states.  (I feel like a broken record here, where is the stimulus?)

$200 Million for work-study grants.  (I see minimal benefit here but what’s $200 million except chump change.)

And finally the part no successful bill can go without, $40.6 Billion for local school districts to balance education budgets, prevent cutbacks and modernize schools.  (It’s for the children.)

Now we move to the stimulating parts of the bill:

$30 billion to modernize the electric grid, encourage advanced battery manufacturing, and energy efficiency grants.  (Hmm, I’ll believe it when I see it.  Somehow environmental concerns will surely drown out nearly all productive use of this $30 B.)

$19 billion in payments to hospitals and physicians who computerize medical-records systems.  (Clears throat, Ahem, excuse me but while this will help hospitals and doctors save money it will not add one job to the economy and will in fact result in more unemployment for low paid workers.)

$8.5 billion for the National Institutes of Health biomedical research into diseases such as Alzheimer’s, Parkinson’s, cancer and heart disease.  (Not bad if we see a result, which is a gamble.)

$5 billion for home weatherization grants to low and middle-income families.  (This has potential if the money must be spent as it is allocated, and not diverted.)

$6.3 billion for energy efficiency upgrades to federally-supported and public housing, including new insulation, windows and frames.  (Sure this will create or save a few jobs.)

$29 billion to modernize Road and bridge infrastructure.  (This is one of the few programs I like not for its job creation but because some of our bridges have become death traps waiting to be sprung.  Maybe some low-end jobs will be maintained in the process.)

$8.4 billion for public transit improvements and infrastructure investments.  (Here I read government waste.  The buddy system will absorb this faster than you can say money grab.)

$8 billion for high-speed rail investments.  (Having traveled and lived abroad, I can say I would love to see high-speed rail service here.  Our culture, however, is simply not conducive to it and this will be a huge failure.  I predict most of the money being spent in legal disputes trying to get rights, property, and overcome opposition.  — The not-in-my-neighborhood crowd.)

$18 billion in grants and loans for water infrastructure, flood prevention and environmental cleanup.  (Projects that would have been pursued with or without the bill.)

This bill is being labelled a “stimulus bill.”  The economy, any economy, is driven by business.  Businesses employ people, businesses pay taxes and businesses enable individuals to pay taxes and buy products and services from businesses. In short, business is the economy.  So any stimulus package should stimulate business activities and encourage job creation within those businesses.  There is very little in this bill that actually stimulates business and creates new jobs.  Far more emphasis seems placed on education benefits and taxpayer give-aways to those who don’t pay taxes rather thanputting the emphasis where it does lasting good – job creation. But hey, it is not really about stimulating those greedy bastards in business, it’s all for the children.



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