Some of the highest paying jobs in America are created by companies that make things. Manufacturing has been a mainstay in the U.S. economy since the beginning of the industrial revolution. Some say that manufacturing is passé, that technology is the future, and that it doesn’t matter if manufacturing dries up and blows away.
The flaw in those arguments (actually there are numerous flaws) is that one of the biggest users of technology today is manufacturers.
Modern manufacturing operations are the showcase for innovative technology. Gone are the days, for instance, when hundreds of laborers engaged in the back-breaking activity of wrestling with logs in a forest products plant. A typical worker in those facilities today is more of a technician than a log wrestler.
State-of-the-art machinery moves the logs, determines the best possible value that can be extracted from them, and turns them into profitable products. The same is true of many industries, such as steel, durable goods, petroleum refining, and chemical manufacturing. Technology is the driving force that has increased productivity in American manufacturing, which has kept us a global leader in manufacturing output.
As noted above, advancements in technology have led directly to a diminution of manufacturing employment in the U.S. Many Americans believe that most of the manufacturing job losses—and there have been millions in the last few decades—are due to plants closing in the U.S. and moving to less-developed countries.
Certainly there has been some of that phenomenon occurring, particularly with low-technology industries. But, until this point, the majority of manufacturing job losses has been due more to productivity advances through technology than out-sourcing manufacturing jobs to foreign countries.
That may change soon. Government policies can have a major impact on any industry, and manufacturing is no exception.
Several issues pending in Congress could accelerate the departure of manufacturing industries and jobs from the U.S. Enactment of “cap and trade” legislation tops the list.
If energy costs rise exponentially for manufacturers in the U.S., companies will undoubtedly look more favorably at countries that do not artificially raise their cost of doing business by raising their energy costs.
Another federal issue that will impact the future of American manufacturing is the “card check” legislation pending in Congress. Some manufacturers work with a union agreement. Others do not. Manufacturers are not generally concerned about the wages involved with a collective bargaining agreement. They already have some of the highest wage scales in the private sector.
What troubles them are the voluminous work rules that come with a union contract. These contract requirements inhibit the productivity advancements necessary for manufacturing to survive in the modern world.
The current health care debate also has the full attention of U.S. manufacturers. The vast majority of our domestic manufacturers provide quality health insurance coverage for their workers. Proposals in Congress would mandate that coverage and possibly tax manufacturers for providing it.
The manufacturing community is very wary of government-imposed mandates from past experience involving many issues. Limiting their ability to design quality, affordable insurance plans for their workers—and possibly making them pay taxes to provide it—will not make them more likely to keep or expand their operations in the U.S.
If America is to remain a world leader in making things, government officials should step lightly when considering policies that could make more of our best jobs leave our shores.
Improving the quality of education, encouraging more research and development, and maintaining job-friendly tax policies will help keep manufacturing jobs in America. Passing some of the proposals pending in Congress will definitely have the opposite effect.
Tuesday, August 25, 2009
Friday, August 7, 2009
Independents Are Taking a Second Look
By Dan Juneau
Presidential campaigns are in some respects like a gruesome war. Large, well-financed armies of partisans slug it out in battles designed to rally their voters into action and to drive down the favorable impressions of the opposing candidate.
But the growing trend in modern elections centers on securing the votes of independent voters not affiliated with either party. This block of voters has increased significantly in the last few decades. They tend to be more conservative than most Democrats on fiscal issues and more liberal than most Republicans on social issues. Recent Democratic successes in both congressional and presidential elections have revolved around securing a majority of these independent voters to back Democrats.
A recent public opinion survey by the Gallup organization contains a clear message that independent voters may be becoming concerned about their decision to place one-party rule in the hands of the Democrats.
The poll, conducted July 17-19, had some interesting findings. Some 59 percent of the respondents said that the Obama administration’s proposals called for too much federal spending. Not surprisingly, 90 percent of Republicans felt that way, compared to only 28 percent of Democrats. But a solid 66 percent of independents expressed strong concern about the high level of federal spending.
In a similar vein, 52 percent of the respondents felt that the Obama agenda was moving toward too great an expansion of the federal government. Again, 83 percent of Republicans held that view while only 17 percent of Democrats concurred. But 60 percent of independent voters expressed a concern that the federal government is growing too large, too fast.
Other recent polling data show that the president’s popularity is falling, support for his handling of key issues is diminished, and the generic ballot question of whether the voters would prefer a Democrat or Republican in Congress is moving more in the direction of the Republicans. Next year is an election year in which every House member and roughly a third of the Senate face elections. That being the case, this recent Gallup poll should be a wake-up call for the president and the congressional members of his party.
Americans have recently seen the enactment of a “stimulus” package totaling almost $800 billion. But they have seen few positive results from that huge amount of government spending.
Voters have also seen the House pass a thousand-page energy/climate change bill that will expand the government’s role in the economy and pit winners against losers in various states and industries. And now Congress is debating perhaps the largest and most expensive expansion of government ever in the form of health care legislation, including a public insurance option backed by the federal treasury.
Many Democrats in Congress are getting uncomfortable with the rush to enact huge new spending programs that will lead to an increase of direct government intervention in the economy. The Gallup poll indicates those Democrats have good reasons to feel that way. The president and the Democratic leaders in Congress are getting concerned that public opinion is shifting away from them on these crucial issues.
They are trying to ram the health care legislation through before members of Congress go home for their August recess. But moderate Democrats are not moving lockstep behind President Obama and the Democratic leadership at this juncture.
One of the major reasons why they are getting cold feet is the fact that they know they must have the votes of those fiscally conservative independent voters if they are going to retain the seats that many of them won from Republicans in the last few elections.
Presidential campaigns are in some respects like a gruesome war. Large, well-financed armies of partisans slug it out in battles designed to rally their voters into action and to drive down the favorable impressions of the opposing candidate.
But the growing trend in modern elections centers on securing the votes of independent voters not affiliated with either party. This block of voters has increased significantly in the last few decades. They tend to be more conservative than most Democrats on fiscal issues and more liberal than most Republicans on social issues. Recent Democratic successes in both congressional and presidential elections have revolved around securing a majority of these independent voters to back Democrats.
A recent public opinion survey by the Gallup organization contains a clear message that independent voters may be becoming concerned about their decision to place one-party rule in the hands of the Democrats.
The poll, conducted July 17-19, had some interesting findings. Some 59 percent of the respondents said that the Obama administration’s proposals called for too much federal spending. Not surprisingly, 90 percent of Republicans felt that way, compared to only 28 percent of Democrats. But a solid 66 percent of independents expressed strong concern about the high level of federal spending.
In a similar vein, 52 percent of the respondents felt that the Obama agenda was moving toward too great an expansion of the federal government. Again, 83 percent of Republicans held that view while only 17 percent of Democrats concurred. But 60 percent of independent voters expressed a concern that the federal government is growing too large, too fast.
Other recent polling data show that the president’s popularity is falling, support for his handling of key issues is diminished, and the generic ballot question of whether the voters would prefer a Democrat or Republican in Congress is moving more in the direction of the Republicans. Next year is an election year in which every House member and roughly a third of the Senate face elections. That being the case, this recent Gallup poll should be a wake-up call for the president and the congressional members of his party.
Americans have recently seen the enactment of a “stimulus” package totaling almost $800 billion. But they have seen few positive results from that huge amount of government spending.
Voters have also seen the House pass a thousand-page energy/climate change bill that will expand the government’s role in the economy and pit winners against losers in various states and industries. And now Congress is debating perhaps the largest and most expensive expansion of government ever in the form of health care legislation, including a public insurance option backed by the federal treasury.
Many Democrats in Congress are getting uncomfortable with the rush to enact huge new spending programs that will lead to an increase of direct government intervention in the economy. The Gallup poll indicates those Democrats have good reasons to feel that way. The president and the Democratic leaders in Congress are getting concerned that public opinion is shifting away from them on these crucial issues.
They are trying to ram the health care legislation through before members of Congress go home for their August recess. But moderate Democrats are not moving lockstep behind President Obama and the Democratic leadership at this juncture.
One of the major reasons why they are getting cold feet is the fact that they know they must have the votes of those fiscally conservative independent voters if they are going to retain the seats that many of them won from Republicans in the last few elections.
Tuesday, July 21, 2009
Where Do We Go From Here?
The Legislature has adjourned, but the dust from this session probably will not settle before next year's session begins. Louisiana, like many other states, is at a critical crossroads. Two governors and two different Legislatures significantly overspent volatile oil and gas revenues in the two years prior to the current one. That was the major cause of the budget crisis state government faced this year. The problem is easy to identify. Simply go back to the decision made under the Blanco administration to fully fund the Rainy Day Trust Fund and allow skyrocketing oil and gas revenues to flow into the state general fund where they could be spent on recurring expenditures. That is exactly what the Legislature did in Governor Blanco's last year and again in Governor Jindal's first year in office. This year, the chickens came home to roost. Unfortunately, even more chickens will be looking for roosting space in the next few years.
Last Thursday, the head of the Congressional Budget Office told Congress that the federal budget is unsustainable going forward with current spending levels-much less the increases being proposed. Some well-credentialed fiscal guru needs to give our governor and Legislature the same message.
In addition to Louisiana's declining revenue problem, the federal government has informed us that, due to a temporary upward blip in personal income, we will be paid $1 billion less in Medicaid money next year. Our state leaders are on their knees begging for mercy from that decision, but there is a strong likelihood that their pleas will go unanswered. Compounding the problem is the fact that in two years, hundreds of millions in "stimulus" dollars will no longer be coming from Washington. The time to plan for that is now, not two years from now.
Another ominous sign on the horizon is the very negative attitude the Obama administration and the majority in Congress is showing toward the oil and gas industry. The industry is facing a drastic increase in taxes and more restrictions on domestic exploration and production. If domestic oil and gas activity is curtailed by new federal laws and regulations, our state revenue picture will become even bleaker.
Governor Jindal is first up at bat in addressing these problems since he must submit an executive budget proposal to the Legislature early next year. What the governor submits in his annual executive budget usually provides the basic blueprint for what comes out of the process. Certainly, the governor can't expect any increase in revenues coming from natural growth in the foreseeable future. That being the case, he will supply the early vision as to how state government must be reconfigured to match appropriate spending levels with real-world revenue projections. His executive budget should also clearly indicate what his spending priorities will be.
The executive and legislative branches should not wait for next year to begin reshaping the delivery of state services to match new revenue realities. Close scrutiny should be given to state funding of local government services, consolidation of functions in post-secondary education, civil service reforms that would enhance state government's ability to consolidate its workforce, and other spending reforms that would reduce the expense side of the state fiscal ledger.
It was fun to be governor or a legislator in the revenue-boom years after the hurricanes when recovery money was flowing and oil and gas prices were setting records. The party is now over. It is time to clean up the excesses and make government work as best as possible with the revenues that are available. That is what families are doing all across Louisiana. Their elected leaders should follow suit.
Last Thursday, the head of the Congressional Budget Office told Congress that the federal budget is unsustainable going forward with current spending levels-much less the increases being proposed. Some well-credentialed fiscal guru needs to give our governor and Legislature the same message.
In addition to Louisiana's declining revenue problem, the federal government has informed us that, due to a temporary upward blip in personal income, we will be paid $1 billion less in Medicaid money next year. Our state leaders are on their knees begging for mercy from that decision, but there is a strong likelihood that their pleas will go unanswered. Compounding the problem is the fact that in two years, hundreds of millions in "stimulus" dollars will no longer be coming from Washington. The time to plan for that is now, not two years from now.
Another ominous sign on the horizon is the very negative attitude the Obama administration and the majority in Congress is showing toward the oil and gas industry. The industry is facing a drastic increase in taxes and more restrictions on domestic exploration and production. If domestic oil and gas activity is curtailed by new federal laws and regulations, our state revenue picture will become even bleaker.
Governor Jindal is first up at bat in addressing these problems since he must submit an executive budget proposal to the Legislature early next year. What the governor submits in his annual executive budget usually provides the basic blueprint for what comes out of the process. Certainly, the governor can't expect any increase in revenues coming from natural growth in the foreseeable future. That being the case, he will supply the early vision as to how state government must be reconfigured to match appropriate spending levels with real-world revenue projections. His executive budget should also clearly indicate what his spending priorities will be.
The executive and legislative branches should not wait for next year to begin reshaping the delivery of state services to match new revenue realities. Close scrutiny should be given to state funding of local government services, consolidation of functions in post-secondary education, civil service reforms that would enhance state government's ability to consolidate its workforce, and other spending reforms that would reduce the expense side of the state fiscal ledger.
It was fun to be governor or a legislator in the revenue-boom years after the hurricanes when recovery money was flowing and oil and gas prices were setting records. The party is now over. It is time to clean up the excesses and make government work as best as possible with the revenues that are available. That is what families are doing all across Louisiana. Their elected leaders should follow suit.
Thursday, July 9, 2009
Action Picks Up In Washington
By Dan Juneau
Major committees in Congress are moving quickly—some would say too quickly—on legislation that will have a great impact on our health and our pocketbooks. The bills that are advancing are quite momentous. If they were being shaped by sound, well-researched analysis, perhaps the proposals wouldn’t be as scary. Unfortunately, much of the health care and energy legislation is being developed more by deal-cutting than by what works in the real world.
The health care legislation is a prime example. The cost estimates for the bills being shaped in various committees range from $1 trillion to $3.5 trillion over a 10-year period. With the budget deficit for next year already slated to be almost $2 trillion, even the spend-happy Congress is under pressure to pay for whatever is proposed and not simply add the cost to the ever-increasing federal deficit.
One of the major taxes being discussed to pay for the health care bills is a tax on employer-provided health insurance. Such a tax could raise almost $500 billion to offset the cost of covering more of the uninsured and underinsured. The problem is it could blow a hole in the foundation of our health care system that is based on coverage paid for all or in part by employers.
Some of the loudest critics of this tax proposal are the labor unions that have negotiated labor contracts with Cadillac benefits largely paid for by their employers. The staunch opposition of the unions is leaving its mark. One of the major Senate proposals now calls for creating an exemption from this tax for—you guessed it!—labor unions. If such a plan passes, non-union workers could be subject to having their employer-provided health insurance premium payments taxed as ordinary income.
That means that, in addition to the regular income tax rate they are subject to applying to this benefit, they would have to pay Medicare and Medicaid taxes on the amount as well. Their employers would also have to pay their share of the Medicare and Medicaid taxes. Non-union employers and employees would have to pay the tax while their union counterparts would escape the burden.
Substituting politics for sound policy decisions is very much at play with the energy legislation under consideration in Congress as well. Speaker of the House Nancy Pelosi is determined to have “cap and trade” legislation—that would limit carbon dioxide emissions and drive up energy costs—enacted by the end of summer.
But Pelosi and Company ran into a wall of opposition from many members of their own Democratic Caucus who are concerned about the economic impact of the legislation on their constituents. Particularly upset are farm state Democrats who believe the legislation could jeopardize their re-elections. The Waxman-Markey bill cannot pass without those key votes. So what happened? Deals were cut to placate the concerns of some but left the constituents of other congressmen (many in “Red States”) on the hook for paying potentially huge increases in energy costs.
This is no way to run a railroad. If a complete revamp of the nation’s health care system is a necessity, then everyone—union members included—should have to pick up the huge cost of paying for it. If significantly increased energy costs are the price that must be paid for reducing carbon dioxide emissions, then everyone in every region of the nation should have to bear those costs. There are sound reasons for opposing both the “cap and trade” legislation and the health care bills. Playing politics with who gets the bill for them only adds fuel to the fire.
Major committees in Congress are moving quickly—some would say too quickly—on legislation that will have a great impact on our health and our pocketbooks. The bills that are advancing are quite momentous. If they were being shaped by sound, well-researched analysis, perhaps the proposals wouldn’t be as scary. Unfortunately, much of the health care and energy legislation is being developed more by deal-cutting than by what works in the real world.
The health care legislation is a prime example. The cost estimates for the bills being shaped in various committees range from $1 trillion to $3.5 trillion over a 10-year period. With the budget deficit for next year already slated to be almost $2 trillion, even the spend-happy Congress is under pressure to pay for whatever is proposed and not simply add the cost to the ever-increasing federal deficit.
One of the major taxes being discussed to pay for the health care bills is a tax on employer-provided health insurance. Such a tax could raise almost $500 billion to offset the cost of covering more of the uninsured and underinsured. The problem is it could blow a hole in the foundation of our health care system that is based on coverage paid for all or in part by employers.
Some of the loudest critics of this tax proposal are the labor unions that have negotiated labor contracts with Cadillac benefits largely paid for by their employers. The staunch opposition of the unions is leaving its mark. One of the major Senate proposals now calls for creating an exemption from this tax for—you guessed it!—labor unions. If such a plan passes, non-union workers could be subject to having their employer-provided health insurance premium payments taxed as ordinary income.
That means that, in addition to the regular income tax rate they are subject to applying to this benefit, they would have to pay Medicare and Medicaid taxes on the amount as well. Their employers would also have to pay their share of the Medicare and Medicaid taxes. Non-union employers and employees would have to pay the tax while their union counterparts would escape the burden.
Substituting politics for sound policy decisions is very much at play with the energy legislation under consideration in Congress as well. Speaker of the House Nancy Pelosi is determined to have “cap and trade” legislation—that would limit carbon dioxide emissions and drive up energy costs—enacted by the end of summer.
But Pelosi and Company ran into a wall of opposition from many members of their own Democratic Caucus who are concerned about the economic impact of the legislation on their constituents. Particularly upset are farm state Democrats who believe the legislation could jeopardize their re-elections. The Waxman-Markey bill cannot pass without those key votes. So what happened? Deals were cut to placate the concerns of some but left the constituents of other congressmen (many in “Red States”) on the hook for paying potentially huge increases in energy costs.
This is no way to run a railroad. If a complete revamp of the nation’s health care system is a necessity, then everyone—union members included—should have to pick up the huge cost of paying for it. If significantly increased energy costs are the price that must be paid for reducing carbon dioxide emissions, then everyone in every region of the nation should have to bear those costs. There are sound reasons for opposing both the “cap and trade” legislation and the health care bills. Playing politics with who gets the bill for them only adds fuel to the fire.
Wednesday, June 24, 2009
Not One For The Record Books
The 2009 Regular Session of the Legislature is approaching its conclusion, and it probably will not generate fond memories in the minds of most individuals. Gertrude Stein once described Oakland, California by saying: "There is no 'there' there." It is difficult at this juncture to capture the "there" in this convocation of the Legislature.
Granted, the budget shortfall usurped almost every other potential topic during the session. Trying to plug a billion-dollar-plus hole in the operating budget was acts one, two, and three of the three-act play that was this legislative session. And, as with most acting performances, there was a lot of posturing and over-playing of roles.
The current battle of the budget centers around the House that wants to make a significant amount of cuts now (believing that there is more fiscal pain coming in the next two budgets), and the Senate that feels the amount of cuts proposed by the House is too severe. The Senate wants to take a significant amount of money from the Rainy Day Fund and to increase tax revenues to supplement the budget. Many members of the House have concerns about tapping the Rainy Day Fund at this juncture and are dead set against raising taxes. The two chambers are on a collision course with only a week left in the session.
Fiscal disputes such as the current one are somewhat rare. Why? Because the Legislature usually follows the governor's lead on budget matters. Governor Jindal has been a player but not necessarily a dominant one thus far in the budget debate. Yes, he said he would not allow any taxes to become law, but that didn't stop the Senate from (illegally) trying to advance one. Perhaps that was just posturing on the Senate's part so they could appear to be funding unfunded elements of the budget and jamming the House with the issue.
But the House wasn't in the mood for a jam. In an interesting move, the House concurred with the Senate amendments to the budget instead of sending the legislation to a conference committee. The Senate then loudly protested that the House had the audacity to adopt the amended version of the budget that the Senate had sent them. (Talk about audacity!) Now the Senate is amending House bills to send more revenue raising measures back to them in order to put pressure on the House to lessen the amount of cuts in the budget that is now sitting on the governor's desk.
The clock is ticking and the outcome of the battle over the budget is still up in the air. One of two scenarios is going to prevail in some fashion: Either the House's view (serious budget cutting needs to begin now because the news only gets worse in subsequent budgets) or the Senate's plan (raise more money now and hope for better times going forward) will become dominant. The outcome could be resolved fairly quickly if Governor Jindal sold the public on exactly what he thinks the solution to the problem should be-and why. He has stated in the past that he is not for raising taxes or tapping the Rainy Day Fund (except for perhaps $50 million) to address the budget shortfall. If that is where he still is in the deliberations, a forceful statement by him would likely conclude the issue. If he has changed his mind, it is time to let the world know.
Granted, the budget shortfall usurped almost every other potential topic during the session. Trying to plug a billion-dollar-plus hole in the operating budget was acts one, two, and three of the three-act play that was this legislative session. And, as with most acting performances, there was a lot of posturing and over-playing of roles.
The current battle of the budget centers around the House that wants to make a significant amount of cuts now (believing that there is more fiscal pain coming in the next two budgets), and the Senate that feels the amount of cuts proposed by the House is too severe. The Senate wants to take a significant amount of money from the Rainy Day Fund and to increase tax revenues to supplement the budget. Many members of the House have concerns about tapping the Rainy Day Fund at this juncture and are dead set against raising taxes. The two chambers are on a collision course with only a week left in the session.
Fiscal disputes such as the current one are somewhat rare. Why? Because the Legislature usually follows the governor's lead on budget matters. Governor Jindal has been a player but not necessarily a dominant one thus far in the budget debate. Yes, he said he would not allow any taxes to become law, but that didn't stop the Senate from (illegally) trying to advance one. Perhaps that was just posturing on the Senate's part so they could appear to be funding unfunded elements of the budget and jamming the House with the issue.
But the House wasn't in the mood for a jam. In an interesting move, the House concurred with the Senate amendments to the budget instead of sending the legislation to a conference committee. The Senate then loudly protested that the House had the audacity to adopt the amended version of the budget that the Senate had sent them. (Talk about audacity!) Now the Senate is amending House bills to send more revenue raising measures back to them in order to put pressure on the House to lessen the amount of cuts in the budget that is now sitting on the governor's desk.
The clock is ticking and the outcome of the battle over the budget is still up in the air. One of two scenarios is going to prevail in some fashion: Either the House's view (serious budget cutting needs to begin now because the news only gets worse in subsequent budgets) or the Senate's plan (raise more money now and hope for better times going forward) will become dominant. The outcome could be resolved fairly quickly if Governor Jindal sold the public on exactly what he thinks the solution to the problem should be-and why. He has stated in the past that he is not for raising taxes or tapping the Rainy Day Fund (except for perhaps $50 million) to address the budget shortfall. If that is where he still is in the deliberations, a forceful statement by him would likely conclude the issue. If he has changed his mind, it is time to let the world know.
Tuesday, June 9, 2009
The Games People Play
Dan Juneau
A recent ruckus in the state legislature has created a lot of anger and garnered national media attention. The incident involved a sneak attack amendment that Representative Avon Honey managed to get tacked onto one of his bills. The result was a 99-0 vote in the House of Representatives for a bill that, as amended, would enact changes in Louisiana’s unemployment compensation law to be eligible for unemployment compensation stimulus money approved by Congress.
There is more than meets the eye in this maneuver. The bill that was amended was on the “consent calendar” of the House agenda. That part of the agenda is reserved for bills that are totally non-controversial and can be considered quickly in order to speed up the legislative process. The original bill pertained to changes in the workers’ compensation law—not unemployment compensation.
Placing an unemployment compensation amendment on the bill violates the “dual object” provision in the Louisiana Constitution. That provision is designed to maintain order in the legislative process by preventing bills from being hijacked willy-nilly by amending them to have more than one objective.
Essentially, Representative Honey’s last second, unconstitutional amendment to his bill on a calendar reserved for totally non-controversial bills violated the legislative process on several levels, but that was just the opening act. When the bill arrived in the Senate, another game was played when it was referred to committee.
Under the Senate’s rules, the bill should have either not been referred due to its dual object flaw or, if referred, it should have gone to the Senate Labor and Industrial Relations Committee. Instead, the bill was referred to the Senate Finance Committee, presumably under the pretext that it has an impact on state finances.
Senate rules do provide for the dual referral of bills that have a significant fiscal impact. However, the rules clearly state that those bills must first go to the substantive committee (in this case, Labor and Industrial Relations), and only if they advance from that committee should they go to the Finance Committee for the fiscal impact review. The rules of procedure were abused and violated in both the House and the Senate on Rep. Honey’s bill.
Why?
Unfortunately, it has a lot to do with game-playing and message-sending. The unemployment compensation stimulus issue has devolved, to a significant degree, into a Republican versus Democrat and Jindal versus Obama spat. Other bills were filed to do exactly what Rep. Honey’s unconstitutional amendment attempts to do.
However, each time those bills were scheduled for hearing in the House committee, the authors declined to have them considered in a free and open debate on their merits. Instead, the route of subterfuge and abuse of legislative rules was taken.
Governor Jindal’s opposition to taking this portion of the stimulus money has to do with future tax increases on struggling employers to pay for the added benefits once the federal money is gone. His objection is a valid one. Some claim that the stimulus money in question is needed to delay tax increases and benefit cuts that will occur as unemployment claims climb in the future.
That is a bogus argument. Those tax increases and benefit cuts will occur next January regardless of the stimulus money. What the changes in our unemployment compensation law will do is bring us closer to additional employer tax increases and unemployment benefit cuts in the future as the unemployment trust fund has to continue to pay for the new benefits once the stimulus money is used up.
There is room for honest debate about the unemployment compensation stimulus money. There shouldn’t be any tolerance for abuse of the process so that some folks can play games and send messages.
A recent ruckus in the state legislature has created a lot of anger and garnered national media attention. The incident involved a sneak attack amendment that Representative Avon Honey managed to get tacked onto one of his bills. The result was a 99-0 vote in the House of Representatives for a bill that, as amended, would enact changes in Louisiana’s unemployment compensation law to be eligible for unemployment compensation stimulus money approved by Congress.
There is more than meets the eye in this maneuver. The bill that was amended was on the “consent calendar” of the House agenda. That part of the agenda is reserved for bills that are totally non-controversial and can be considered quickly in order to speed up the legislative process. The original bill pertained to changes in the workers’ compensation law—not unemployment compensation.
Placing an unemployment compensation amendment on the bill violates the “dual object” provision in the Louisiana Constitution. That provision is designed to maintain order in the legislative process by preventing bills from being hijacked willy-nilly by amending them to have more than one objective.
Essentially, Representative Honey’s last second, unconstitutional amendment to his bill on a calendar reserved for totally non-controversial bills violated the legislative process on several levels, but that was just the opening act. When the bill arrived in the Senate, another game was played when it was referred to committee.
Under the Senate’s rules, the bill should have either not been referred due to its dual object flaw or, if referred, it should have gone to the Senate Labor and Industrial Relations Committee. Instead, the bill was referred to the Senate Finance Committee, presumably under the pretext that it has an impact on state finances.
Senate rules do provide for the dual referral of bills that have a significant fiscal impact. However, the rules clearly state that those bills must first go to the substantive committee (in this case, Labor and Industrial Relations), and only if they advance from that committee should they go to the Finance Committee for the fiscal impact review. The rules of procedure were abused and violated in both the House and the Senate on Rep. Honey’s bill.
Why?
Unfortunately, it has a lot to do with game-playing and message-sending. The unemployment compensation stimulus issue has devolved, to a significant degree, into a Republican versus Democrat and Jindal versus Obama spat. Other bills were filed to do exactly what Rep. Honey’s unconstitutional amendment attempts to do.
However, each time those bills were scheduled for hearing in the House committee, the authors declined to have them considered in a free and open debate on their merits. Instead, the route of subterfuge and abuse of legislative rules was taken.
Governor Jindal’s opposition to taking this portion of the stimulus money has to do with future tax increases on struggling employers to pay for the added benefits once the federal money is gone. His objection is a valid one. Some claim that the stimulus money in question is needed to delay tax increases and benefit cuts that will occur as unemployment claims climb in the future.
That is a bogus argument. Those tax increases and benefit cuts will occur next January regardless of the stimulus money. What the changes in our unemployment compensation law will do is bring us closer to additional employer tax increases and unemployment benefit cuts in the future as the unemployment trust fund has to continue to pay for the new benefits once the stimulus money is used up.
There is room for honest debate about the unemployment compensation stimulus money. There shouldn’t be any tolerance for abuse of the process so that some folks can play games and send messages.
Sunday, May 24, 2009
Focus on the Millages
Dan Juneau
There is a lot of debate going on at the State Capitol on the issue of property taxation. Some of it centers on raising the homestead exemption, some on freezing or capping tax assessments, and some on carving out special property tax safe harbors for relatively small groups of people. The property tax issue is a complex one and few understand exactly how their property tax bills work.
Individuals with concerns about property taxes should focus on one main aspect: millages. The millage amount is applied to the assessed valuation of taxpayers’ property to determine the amount of taxes owed: the higher the millages, the higher the tax bill.
How do millages go up? Taxpayers can vote to increase the millages in a tax election. If the tax proposition passes, the new millages are added to the next tax bill. Perhaps the most common way millages go up relates to something called roll-forwards. Every four years, residential property is reappraised by the local assessors. If values rise (which is common), the state constitution requires that millages must automatically be rolled back to a level that collects the same amount of tax revenue on the books before the reassessment of property. However, the constitution also gives local governing authorities the option to roll the millages forward to their previous levels—without a vote of the people—in order to collect more revenue. Millages also will rise significantly if the homestead exemption is increased. An increase in the exemption narrows the tax base and millages then automatically roll forward (with no vote required on anyone’s part) to higher levels.
Some of the proponents of raising the homestead exemption say it would result in a reduction of property taxes. That isn’t correct. It would simply result in a transfer of property taxes from some taxpayers to others. It would become a tax increase to many homeowners whose homes are valued higher than the exempted levels, to businesses that already pay almost 80 percent of the property taxes, and to renters whose landlords would pass on their tax increases in the form of higher rents.
According to the Tax Foundation, Louisiana ranks dead last (51st among the 50 states and the District of Columbia) in residential property taxes paid. At the same time, Louisiana has the highest homestead exemption in the nation ($75,000 of home value). The taxpayers who have seen their property tax bills go up a noticeable amount are looking at the wrong element of relief if they think raising the homestead exemption is the answer. Most of the increases are coming from the roll-forward of millages by local governments after reassessments are done.
Everyone benefits from public education, public safety, roads, water, and sewerage infrastructure improvements, libraries, and other public services. The individuals who are pushing for a higher homestead exemption think only a small group of taxpayers—primarily business owners and homeowners who are already paying more than their fair share of property taxes—should be the exclusive source for funding those necessary services. Others in the Legislature are carving out property tax exclusions for small groups of homeowners, not by giving them a direct credit for lower taxes on their tax bills, but by having someone else pay their taxes.
Some members of the Legislature appear hell-bent on making a bad situation worse when it comes to our property tax system. Unfortunately, our Governor is voicing his support for some of the legislation that would be the antithesis of the fiscal reform needed to improve tax fairness and the business climate of Louisiana.
There is a lot of debate going on at the State Capitol on the issue of property taxation. Some of it centers on raising the homestead exemption, some on freezing or capping tax assessments, and some on carving out special property tax safe harbors for relatively small groups of people. The property tax issue is a complex one and few understand exactly how their property tax bills work.
Individuals with concerns about property taxes should focus on one main aspect: millages. The millage amount is applied to the assessed valuation of taxpayers’ property to determine the amount of taxes owed: the higher the millages, the higher the tax bill.
How do millages go up? Taxpayers can vote to increase the millages in a tax election. If the tax proposition passes, the new millages are added to the next tax bill. Perhaps the most common way millages go up relates to something called roll-forwards. Every four years, residential property is reappraised by the local assessors. If values rise (which is common), the state constitution requires that millages must automatically be rolled back to a level that collects the same amount of tax revenue on the books before the reassessment of property. However, the constitution also gives local governing authorities the option to roll the millages forward to their previous levels—without a vote of the people—in order to collect more revenue. Millages also will rise significantly if the homestead exemption is increased. An increase in the exemption narrows the tax base and millages then automatically roll forward (with no vote required on anyone’s part) to higher levels.
Some of the proponents of raising the homestead exemption say it would result in a reduction of property taxes. That isn’t correct. It would simply result in a transfer of property taxes from some taxpayers to others. It would become a tax increase to many homeowners whose homes are valued higher than the exempted levels, to businesses that already pay almost 80 percent of the property taxes, and to renters whose landlords would pass on their tax increases in the form of higher rents.
According to the Tax Foundation, Louisiana ranks dead last (51st among the 50 states and the District of Columbia) in residential property taxes paid. At the same time, Louisiana has the highest homestead exemption in the nation ($75,000 of home value). The taxpayers who have seen their property tax bills go up a noticeable amount are looking at the wrong element of relief if they think raising the homestead exemption is the answer. Most of the increases are coming from the roll-forward of millages by local governments after reassessments are done.
Everyone benefits from public education, public safety, roads, water, and sewerage infrastructure improvements, libraries, and other public services. The individuals who are pushing for a higher homestead exemption think only a small group of taxpayers—primarily business owners and homeowners who are already paying more than their fair share of property taxes—should be the exclusive source for funding those necessary services. Others in the Legislature are carving out property tax exclusions for small groups of homeowners, not by giving them a direct credit for lower taxes on their tax bills, but by having someone else pay their taxes.
Some members of the Legislature appear hell-bent on making a bad situation worse when it comes to our property tax system. Unfortunately, our Governor is voicing his support for some of the legislation that would be the antithesis of the fiscal reform needed to improve tax fairness and the business climate of Louisiana.
Tuesday, May 19, 2009
The Champagne of the Hydrocarbons
05/15/2009
Some 30 years ago, I was coordinating a group of independent oil and gas operators from the Lafayette area lobbying members of Congress on energy legislation. During that time, we pushed successfully for some of the critical production incentives that are now being threatened by the Obama administration and their supporters on Capitol Hill. On one of my visits, I met with the chief legislative aide of then-Senator Lowell Weicker of Connecticut. She was the most intelligent person I met on the Hill-elected or non-elected. The first time I mentioned the words "natural gas," she replied: "Ah yes, the champagne of the hydrocarbons." As Congress and the Obama team thrash about in search of an energy policy, they would be well served to start with a tall glass of that champagne.
A sound energy policy for America should focus on what we have, what we need, and what reduces dependence on foreign energy sources. We need reliable sources for electricity and transportation. We have abundant energy sources in place. We need a rational energy policy to maximize domestic sources with national energy needs. We may get the opposite.
A few years ago, the conventional wisdom was that natural gas supplies had peaked and were entering a period of decline. That "conventional wisdom" was wrong. During the last two years, natural gas production increased by a total of 10 percent and new discoveries expanded proven reserves by 12.6 percent to 6.73 trillion cubic meters. The outlook for natural gas reserves is now improving, not declining, due to the huge amounts of gas located in shale deposits such as the Haynesville Shale field in northwest Louisiana (estimated to be the fourth largest natural gas field in the world). A sound energy policy should maximize the use of compressed natural gas (CNG) in vehicles, lessening dependence on foreign oil to meet those needs.
An increase in nuclear-generated electrical power is also a no-brainer. France gets most of its electricity from these plants, and 30 years ago the U.S. was moving in the same direction. America's electrical generation mix should see an increase in nuclear generation to bring more stability and reliability to the effort of meeting ever-increasing electricity demands.
The powers that be in Washington talk about spending trillions of dollars to increase "alternative" energy sources. Wind and solar power seem to be their favored candidates for huge amounts of federal funding. Science and economics indicate that these alternatives can be minor players in diversifying our energy mix, but cannot become major replacements for the fossil fuels that light our homes and power our cars.
Investments in clean coal technology, incentives for the natural gas vehicle marketplace, and a more streamlined permitting process for nuclear power plants should be the foundation of an energy policy that better protects the environment and has a decent chance of meeting future energy needs. It currently takes about 10 years to permit a nuclear reactor, seven years to permit a coal-fired power plant, and five years for a natural gas-powered facility. Bringing nuclear plant permitting more in line with other generation facilities would be a significant step forward.
Oil and natural gas are not going to disappear from our energy mix any time soon. Current efforts to subsidize solar and wind technologies by removing incentives for exploration and production of domestic oil and natural gas supplies are counterintuitive. We should maximize our domestic energy stocks, particularly those that wean us away from foreign sources of energy. If we don't, we are tilting at windmills in our quest for energy independence and reliability.
Some 30 years ago, I was coordinating a group of independent oil and gas operators from the Lafayette area lobbying members of Congress on energy legislation. During that time, we pushed successfully for some of the critical production incentives that are now being threatened by the Obama administration and their supporters on Capitol Hill. On one of my visits, I met with the chief legislative aide of then-Senator Lowell Weicker of Connecticut. She was the most intelligent person I met on the Hill-elected or non-elected. The first time I mentioned the words "natural gas," she replied: "Ah yes, the champagne of the hydrocarbons." As Congress and the Obama team thrash about in search of an energy policy, they would be well served to start with a tall glass of that champagne.
A sound energy policy for America should focus on what we have, what we need, and what reduces dependence on foreign energy sources. We need reliable sources for electricity and transportation. We have abundant energy sources in place. We need a rational energy policy to maximize domestic sources with national energy needs. We may get the opposite.
A few years ago, the conventional wisdom was that natural gas supplies had peaked and were entering a period of decline. That "conventional wisdom" was wrong. During the last two years, natural gas production increased by a total of 10 percent and new discoveries expanded proven reserves by 12.6 percent to 6.73 trillion cubic meters. The outlook for natural gas reserves is now improving, not declining, due to the huge amounts of gas located in shale deposits such as the Haynesville Shale field in northwest Louisiana (estimated to be the fourth largest natural gas field in the world). A sound energy policy should maximize the use of compressed natural gas (CNG) in vehicles, lessening dependence on foreign oil to meet those needs.
An increase in nuclear-generated electrical power is also a no-brainer. France gets most of its electricity from these plants, and 30 years ago the U.S. was moving in the same direction. America's electrical generation mix should see an increase in nuclear generation to bring more stability and reliability to the effort of meeting ever-increasing electricity demands.
The powers that be in Washington talk about spending trillions of dollars to increase "alternative" energy sources. Wind and solar power seem to be their favored candidates for huge amounts of federal funding. Science and economics indicate that these alternatives can be minor players in diversifying our energy mix, but cannot become major replacements for the fossil fuels that light our homes and power our cars.
Investments in clean coal technology, incentives for the natural gas vehicle marketplace, and a more streamlined permitting process for nuclear power plants should be the foundation of an energy policy that better protects the environment and has a decent chance of meeting future energy needs. It currently takes about 10 years to permit a nuclear reactor, seven years to permit a coal-fired power plant, and five years for a natural gas-powered facility. Bringing nuclear plant permitting more in line with other generation facilities would be a significant step forward.
Oil and natural gas are not going to disappear from our energy mix any time soon. Current efforts to subsidize solar and wind technologies by removing incentives for exploration and production of domestic oil and natural gas supplies are counterintuitive. We should maximize our domestic energy stocks, particularly those that wean us away from foreign sources of energy. If we don't, we are tilting at windmills in our quest for energy independence and reliability.
Wednesday, May 13, 2009
The “Louisiana Way”
Dan Juneau
Louisiana has suffered over the years from a reputation of
having politics unduly and negatively influence the business
climate of the state. Louisiana’s nearly unique system for
collecting and administering sales tax revenues is a
particular problem when the Bayou State is compared to others.
These two factors converged recently in a way that sends
another negative message regarding how Louisiana businesses
are treated in matters of taxation.
The issue centers on Louisiana’s system of sales tax
collection, in particular the lack of centralized collection
of sales taxes. In almost every other state, there is only one
collector of the sales tax: the state. The money is collected
centrally and disbursed back to the local governments in
proportion to their local rate of taxation.
Local jurisdictions pay the state a small fee to collect their
taxes; however, they save money by not having to maintain an
expensive and duplicative local bureaucracy to do the
collections. In the other states, the central collector also
conducts audits of taxpayers. If taxes have not been paid
properly, the state collects the principal, interest, and
penalties for both the state and the local taxing entities.
Businesses have to fill out only one form—not a multiplicity
of them—when they submit their sales taxes. And they are
subject to only one auditing entity—not scores of them.
Our antiquated system of sales tax administration results in
Louisiana ranking at the bottom of “tax fairness” indicators
among the 50 states. Our laws in this regard are bad enough.
Unfortunately, a recent opinion written by our Attorney
General, Buddy Caldwell, makes a bad situation worse.
Louisiana law prohibits entities that collect local sales
taxes from contracting with private auditors on a contingency
fee basis to audit sales tax returns. The logic for this is
simple: auditing entities should not be tempted to treat
taxpayers unfairly in order to increase their compensation
from the local governments. These auditors have contracts that
give them a percentage of the amount of money collected
instead of being paid a flat fee or billing on an hourly basis
to do the audits.
Some local governments have defied the law and continue to use
contingency fee contracts. They have hidden behind the fig
leaf of a flawed Attorney General’s opinion from years ago
that found the contingency contracts not in conflict with the
law. An Attorney General’s opinion is just that—one lawyer’s
opinion, not something that changes a statute.
Senator Jack Donahue requested that Attorney General
Caldwell’s office revisit the opinion written by one of his
predecessors. Caldwell’s office did that and issued two new
opinions that clearly cited legal reasons why the previous
opinion was flawed. Then politics entered the equation. The
contract auditors and the local collectors they work for
leaned heavily on Caldwell to withdraw his new opinions.
Their arguments centered upon their desire not to pay auditors out
of their own funds rather than on any sound legal doctrine
proving that the current law somehow allows contingency fee
contracts. Attorney General Caldwell succumbed to the
“pressure” put on him by a few sales tax collectors and
reinstated the opinion written years ago.
In doing so, he confirmed to the national business community that anti-
business political chicanery is alive and well in Louisiana.
In the Bayou State, it often seems like for every step we take
forward in improving our business climate, we tend to take two
steps backward. Attorney General Caldwell’s recent sales tax
opinion is a prime example of that syndrome. Some call it the
“Louisiana Way.” It is the path to fewer jobs and less outside
investment, things that are sorely needed in these trying
times.
Louisiana has suffered over the years from a reputation of
having politics unduly and negatively influence the business
climate of the state. Louisiana’s nearly unique system for
collecting and administering sales tax revenues is a
particular problem when the Bayou State is compared to others.
These two factors converged recently in a way that sends
another negative message regarding how Louisiana businesses
are treated in matters of taxation.
The issue centers on Louisiana’s system of sales tax
collection, in particular the lack of centralized collection
of sales taxes. In almost every other state, there is only one
collector of the sales tax: the state. The money is collected
centrally and disbursed back to the local governments in
proportion to their local rate of taxation.
Local jurisdictions pay the state a small fee to collect their
taxes; however, they save money by not having to maintain an
expensive and duplicative local bureaucracy to do the
collections. In the other states, the central collector also
conducts audits of taxpayers. If taxes have not been paid
properly, the state collects the principal, interest, and
penalties for both the state and the local taxing entities.
Businesses have to fill out only one form—not a multiplicity
of them—when they submit their sales taxes. And they are
subject to only one auditing entity—not scores of them.
Our antiquated system of sales tax administration results in
Louisiana ranking at the bottom of “tax fairness” indicators
among the 50 states. Our laws in this regard are bad enough.
Unfortunately, a recent opinion written by our Attorney
General, Buddy Caldwell, makes a bad situation worse.
Louisiana law prohibits entities that collect local sales
taxes from contracting with private auditors on a contingency
fee basis to audit sales tax returns. The logic for this is
simple: auditing entities should not be tempted to treat
taxpayers unfairly in order to increase their compensation
from the local governments. These auditors have contracts that
give them a percentage of the amount of money collected
instead of being paid a flat fee or billing on an hourly basis
to do the audits.
Some local governments have defied the law and continue to use
contingency fee contracts. They have hidden behind the fig
leaf of a flawed Attorney General’s opinion from years ago
that found the contingency contracts not in conflict with the
law. An Attorney General’s opinion is just that—one lawyer’s
opinion, not something that changes a statute.
Senator Jack Donahue requested that Attorney General
Caldwell’s office revisit the opinion written by one of his
predecessors. Caldwell’s office did that and issued two new
opinions that clearly cited legal reasons why the previous
opinion was flawed. Then politics entered the equation. The
contract auditors and the local collectors they work for
leaned heavily on Caldwell to withdraw his new opinions.
Their arguments centered upon their desire not to pay auditors out
of their own funds rather than on any sound legal doctrine
proving that the current law somehow allows contingency fee
contracts. Attorney General Caldwell succumbed to the
“pressure” put on him by a few sales tax collectors and
reinstated the opinion written years ago.
In doing so, he confirmed to the national business community that anti-
business political chicanery is alive and well in Louisiana.
In the Bayou State, it often seems like for every step we take
forward in improving our business climate, we tend to take two
steps backward. Attorney General Caldwell’s recent sales tax
opinion is a prime example of that syndrome. Some call it the
“Louisiana Way.” It is the path to fewer jobs and less outside
investment, things that are sorely needed in these trying
times.
Tuesday, April 14, 2009
Guaranteeing The Guarantees
04/03/2009
Occasionally you hear things that you find hard to believe. That happened recently when I heard the 44th President of the United States giving a government guarantee for the warranties of cars purchased from General Motors and Chrysler. It was the perfect metaphor for the unparalleled intrusion of government into the marketplace that accelerated with the 43rd President's bailout of financial institutions deemed "too big to fail." It is now at warp speed with the policies of the current administration. Our federal government is now favoring certain companies over others-both in the financial sector and the automobile industry. These policies are ripe for conflict of interest, cronyism, and more manifestations of the cruel law of unintended consequences.
Guaranteeing the automotive warranties is perhaps a symbol for the new approach to governance in America. The federal government is lining up a bevy of "guarantees" that, if enacted, would significantly change our social compact.
One of the "guarantees" is in health care. President Obama and many of his allies in Congress want to move to a universal health care system in which every American is guaranteed health care coverage. While the plan is not designed to be a "single payer" system with the federal government making all of the payments for (and many of the decisions regarding) health care procedures, it could eventually default into such a system. The cost for the health care plan the president advocates would be enormous. Greatly expanding health care coverage will place escalating demands on the providers within the system. When costs rise (and they will), the government no doubt will employ the same "cost saving" measure it uses for Medicare and Medicaid: reducing the amount of compensation paid to providers. That would likely drive more providers out of the system and could result in rationed care.
President Obama plans to raise the money for his health care initiative from a huge "hidden" tax on carbon emissions. His "cap and trade" approach would have the federal government "guarantee" success in the fight against "manmade" global warming by limiting the amount of carbon dioxide emissions permitted and taxing those that exceed the limits. The president and his congressional supporters, disregard the fact that the amount of atmospheric warming has only risen 0.4 of a degree centigrade in the last 100 years and none in the last 11. They are on a jihad that could cost the U.S. economy as much as $1.9 trillion if this plan is implemented. The effect on jobs and economic growth would be so damaging that even many members of the "tax and spend" crowd in Congress are starting to put the brakes on this idea.
President Obama and many in Congress are pursuing a goal of "guaranteeing" a comfortable life for every citizen of the U.S. In their scenario, the government would see to it that every American will have a good job, a good education, high quality health care and a sound retirement. That is a noble goal that is easier to promote than to accomplish. Historically, those ends are achieved by hard work, a diligent approach to studies and saving for the future. Our leaders in Washington should perhaps eschew the temptation to promise so many guarantees and instead concentrate on making the massive behemoth of the federal government do less and do it much better for the folks who pay dearly to finance it. Promises quickly turn empty fast when the models that deliver them don't work and the cost for providing them brings with it the specter of fiscal insolvency.
Occasionally you hear things that you find hard to believe. That happened recently when I heard the 44th President of the United States giving a government guarantee for the warranties of cars purchased from General Motors and Chrysler. It was the perfect metaphor for the unparalleled intrusion of government into the marketplace that accelerated with the 43rd President's bailout of financial institutions deemed "too big to fail." It is now at warp speed with the policies of the current administration. Our federal government is now favoring certain companies over others-both in the financial sector and the automobile industry. These policies are ripe for conflict of interest, cronyism, and more manifestations of the cruel law of unintended consequences.
Guaranteeing the automotive warranties is perhaps a symbol for the new approach to governance in America. The federal government is lining up a bevy of "guarantees" that, if enacted, would significantly change our social compact.
One of the "guarantees" is in health care. President Obama and many of his allies in Congress want to move to a universal health care system in which every American is guaranteed health care coverage. While the plan is not designed to be a "single payer" system with the federal government making all of the payments for (and many of the decisions regarding) health care procedures, it could eventually default into such a system. The cost for the health care plan the president advocates would be enormous. Greatly expanding health care coverage will place escalating demands on the providers within the system. When costs rise (and they will), the government no doubt will employ the same "cost saving" measure it uses for Medicare and Medicaid: reducing the amount of compensation paid to providers. That would likely drive more providers out of the system and could result in rationed care.
President Obama plans to raise the money for his health care initiative from a huge "hidden" tax on carbon emissions. His "cap and trade" approach would have the federal government "guarantee" success in the fight against "manmade" global warming by limiting the amount of carbon dioxide emissions permitted and taxing those that exceed the limits. The president and his congressional supporters, disregard the fact that the amount of atmospheric warming has only risen 0.4 of a degree centigrade in the last 100 years and none in the last 11. They are on a jihad that could cost the U.S. economy as much as $1.9 trillion if this plan is implemented. The effect on jobs and economic growth would be so damaging that even many members of the "tax and spend" crowd in Congress are starting to put the brakes on this idea.
President Obama and many in Congress are pursuing a goal of "guaranteeing" a comfortable life for every citizen of the U.S. In their scenario, the government would see to it that every American will have a good job, a good education, high quality health care and a sound retirement. That is a noble goal that is easier to promote than to accomplish. Historically, those ends are achieved by hard work, a diligent approach to studies and saving for the future. Our leaders in Washington should perhaps eschew the temptation to promise so many guarantees and instead concentrate on making the massive behemoth of the federal government do less and do it much better for the folks who pay dearly to finance it. Promises quickly turn empty fast when the models that deliver them don't work and the cost for providing them brings with it the specter of fiscal insolvency.
Subscribe to:
Posts (Atom)
