Martin O'Malley's War on Maryland Taxpayers

Here is a succinct article from the Daily Caller that sums up the state of affairs in Maryland, as we face a torrent of tax hikes next year:

This past July, a 50 percent increase in the state’s sales tax on liquor went into effect. The measure was rammed through by Democrat legislators and signed by O’Malley, despite opposition from small business owners and taxpayers. In its first year, it will raise $88 million in revenue on the backs of low- and middle-income Marylanders.

Now, O’Malley is pushing for a $1-per-pack cigarette tax increase. Lifestyle taxes, because they are generally not value-added — as is the case with the cigarette tax proposal — disproportionally affect the poor. O’Malley’s cigarette tax proposal would come on top of President Obama’s 61-cents-per-pack federal tobacco excise tax, which Obama signed into law in 2009.

In addition to increasing taxes on cigarettes, O’Malley wants to increase Maryland’s gas tax by 15 cents per gallon, which is expected to raise $491 million in its first year of implementation. An increase in the gas tax would disproportionately hit small business owners and working families who have to travel in order to find employment in Maryland’s weak economy.

You can read the entire article here.

Tax hikes and the impending redistricting plan will be our biggest battles during the coming months.

Telling the Truth About Medicare

We must end the vicious cycle of third-party payer and rising healthcare costs

By far, our largest unfunded liabilities are Social Security and Medicare.  According to recent actuarial reports, Medicare faces a $25 trillion liability and Social Security has an unfunded liability of $21 trillion.  And those numbers are regarded as low-ball figures, due to their unrealistic accounting for cost-cutting measures.  They already represent the largest expenditures of the federal government, with Social Security and Medicare consuming 20.2% and 14.6% of the budget respectively.  Those numbers are slated to skyrocket as the retirement population doubles over the next three decades.  Hence, any meaningful discussion of balanced budgets must include a plan to fix these two entitlement behemoths – brought to you by previous Democrat presidents.

The first step to entitlement reform must include an acknowledgement of the dichotomy between the two largest programs.  Social Security and Medicare are very different programs.  Consequently, they face divergent problems and require dissimilar solutions.

Last week, healthcare expert Christopher Conover posted an analysis at the American Enterprise Institute, illustrating the differences between Social Security and Medicare.  He found that while most people (except low-income earners) receive Social Security benefits that are roughly commensurate to their contributions from the 12.4% payroll tax, the same cannot be said of Medicare benefits.  The average Medicare recipient, according to Conover, received $2-$6 per every dollar paid into the system via the 2.9% Medicare tax.  Moreover, the only people who earn all of their Medicare benefits are those earning an average of $130,000 a year over their entire career – the very people who will see a payroll tax increase under Obamacare.

Reagan's Recovery vs. Obama's "Recovery"

The media is truncating the latest GDP report, which shows a mild improvement in economic growth.  Aside for the fact that the internal numbers of the report aren't nearly as promising as the top-line 2.5% figure, the historical context of such a lackluster recovery is jarring.  Compare our current economic recovery to the same time period following the 1981 recession during Regan's presidency:

 (Courtesy of Market Watch)

Indeed!

The CBO Has Been Occupied by OWS's Intellectual Inequality

We already are the most progressive redistributive country in the world – and that is the problem

One fundamental liberal desideratum is the achievement of equal results at the expense of equal opportunity.  Conservatives believe in implementing policies that protect our God-given rights, which provide every human being with an equal opportunity to succeed.  Liberals reject policies that foster unfettered equal opportunity because they invariably produce unequal results, being that human beings have different talents, capabilities, work ethic, and luck.  On Tuesday, the CBO decided to throw in with the left-wing affinity for highlighting income inequality and advocacy for equal outcomes – outcomes that would be dictated by our venerable federal government.

While the focus on income inequality in itself is a dubious endeavor for the CBO, their conclusions are downright scandalous.  Their most outlandish conclusion was that income inequality has increased between 1979 and 2007 due to a decrease in “government transfers” and tax cuts for the rich.  Here was their punch line:

Government Transfers and Federal Taxes Became Less Redistributive

Government transfers and federal taxes both help to even out the income distribution. Transfers boost income the most for lower-income households, while taxes claim a larger share of income as people’s income rises.
In 2007, federal taxes and transfers reduced the dispersion of income by 20 percent, but that equalizing effect was larger in 1979.

• The share of transfer payments to the lowest-income households declined.
• The overall average federal tax rate fell.

You might be scratching your head wondering how CBO can posit such a falsehood at a time when welfare spending is at an all-time high, the top 1% pay 36.7% of income taxes, even though they only earn 16.9% of AGI, and 47% pay zero income taxes.

Stop Harry Reid's Egregious Budget Power Grab

Don't let the fox guard the hen house

Senate Democrats (and all other Democrats, for that matter) have not passed a budget for over 900 days, yet they are planning to come late to the game and commandeer the appropriations process.  After delaying the process for over two years, Harry Reid, with the help of some Senate Republicans, is planning to expedite appropriations bills in a way that disavows standard procedures of transparency.  House Republicans must rebuff this insidious plan.

When Republicans assumed control of the House earlier this year, they completed the job that Democrats refused to do regarding the FY 2011 budget.  Additionally, they passed a concurrent budget resolution for FY 2012, and proceeded to complete half of the 12 annual appropriations bills.  When it became clear that Senate Democrats were dithering with roll call votes and speeches, and had no intention of even passing a budget resolution, Republicans held back the remaining approps bills, in an effort to wait for the Senate to get its act together.

Now, instead of coming to the table and passing the 12 individual appropriations bills along with a budget resolution, Harry Reid is seeking to circumvent the process by using “Minibus” bills.  He rightfully perceives that a 12-bill omnibus package would be politically unpopular, so he is planning to bundle the 12 appropriations bill into four minibus bills, containing three spending bills apiece.

Why does Reid want to use this awkward and obscure process for appropriations bills?

Obama's Government Behemoth

This chart detailing the trend-line of growth in government workers speaks for itself.

(Courtesy of Veronique de Rugby of the Mercatus Center)

A Conservative Look at Perry's Economic Plan

When Herman Cain proposed his 9-9-9 plan, many conservatives became energized, despite their misgivings with the fine print of the plan.  It wasn’t so much the details of the proposal that excited the base, as most conservatives intuitively recoiled from a consumption tax; it was the boldness of the plan that resonated with them.  Cain’s 9-9-9 brought some excitement to a race that was defined by a frontrunner who offered 160 pages of banal fluff.  Nevertheless, his plan was too flawed to be utilized as a viable rallying cry in the general election.  Perry appears to have proposed both a viable and bold economic plan, albeit with some inevitable flaws.

Here is a synopsis of all of the major components.

Tax Plan

The centerpiece of the plan is a flat individual income tax of 20%.  This would serve as a vehicle for massive economic growth, as it offers a huge tax cut for job-creators who currently pay as much as 35%.  However, unlike the traditional Steve Forbes flat tax, this proposal would keep the deductions for mortgage interest, charitable contributions, and state and local taxes for those earning less than $500,000 (over 99% of taxpayers).  It would also offer a standard deduction of $12,500 per household members.  Consequently, a family of four earning $50,000 would have a zero tax liability.  Update: Phillip Klein reports that the employer tax exclusion for healthcare would remain until Obamacare is repealed.

Moreover, the entire system would preserve the option to remain under the current tax code.  As such, the 47% who have zero tax liability and the 29% who have a positive tax liability (as a result of the EITC and Additional Child Tax Credit), would have no incentive to move to the flat tax.  Accordingly, there would be two shortcomings to this plan:

The Myth that Oil Companies Pay No Taxes

The media has widely disseminated a fallacious notion that oil companies use so many loopholes that they barely pay any taxes.  Well, Investor's Business Daily has a nice graphic showing the effective tax rates of some major companies in the U.S.  It turns out that it is Obama's cronies at General Electric that get away with all of the loopholes.

As you can see, ExxonMobile pays an effective rate of 45%, while GE enjoys a paltry 7.4% rate.  This is why we must flatten out the corporate tax rate to one low and fair number.

Barack the $15 Trillion Man

A truly historic presidency

Amidst the hype concerning the so-called era of austerity and budget cuts, the national debt is rapidly marching towards the $15 trillion milestone.  As of late last week, the national debt stood at $14.94 trillion.  For those of you keeping score, that number has grown by $646 billion since the debt ceiling was raised on August 2, as part of the great bipartisan Budget Control Act of 2011.  In other words, the debt has increased by over $8 billion per day during the past 11 weeks.

Let's put these numbers in historical perspective.

Barack Obama likes to blame all of our economic woes on his predecessor.  The burgeoning national debt is no different, as he blames its precipitous rise on the Bush tax cuts.  Well, President Bush and his merry band of big-government conservatives were anything but budget hawks; nonetheless, it took them 92 months – almost the entire 8-year tenure – to accrue $4.3 trillion in debt.  Obama has accumulated that much debt in just 33 months.  Put another way, it wasn't until 1997 that we amassed as much debt as Obama has in 2.5 years.

There is also another grim, but often overlooked statistic of Obama's empire of debt.

The national debt consists of two components; debt held by the public and intra-government debt.  The debt held by the public is the sum of the treasury securities held by those outside the federal government, with the lion's share owned by foreign countries.  The debt held by the public currently stands at $10.2 trillion.  The other component, the intra-governmental share, is owed to other federal agencies and accounts, most prominently, the non-existent Social Security Trust Fund, as well as accounts holding pensions for military veterans and government workers.  That share of the debt currently stands at $4.73 trillion.

OWS Flag Desecration

Amidst the fawning coverage from the media, the OWS crowd as already gotten away with rabid anti-semitism and other forms of extremism.  Now they are resorting to desecration of the American flag.  Don't expect this to be covered outside of the new media:

(HT: Weasel Zippers)

Watch Romney Praise Ted Kennedy Over Romneycare

Is this what we fought for in the conservative movement for the past half century?

Chris Christie is Intellectually Dishonest

Earlier today, Chris Christie endorsed Mitt Romney for president, describing him as “a real hero in Republican circles.”  During his announcement, he disparaged conservatives who oppose Romneycare, by suggesting that any attempt to compare it to Obamacare is “completely intellectually dishonest.”  Governor Christie might want to look in the mirror or step down as a prominent spokesman for the Republican Party.
Any attempt to suggest that the two healthcare plans are fundamentally different is completely intellectually dishonest.

Romney on Romneycare


“Let me tell you this about our system in Massachusetts: 92 percent of our people were insured before we put our plan in place. Nothing’s changed for them. The system is the same. They have private market-based insurance.  We had 8 percent of our people that weren’t insured. And so what we did is we said let’s find a way to get them insurance, again, market-based private insurance. We didn’t come up with some new government insurance plan.” (FoxNews-Google Debate, Sept. 22)

Reality


Like every egregious government intervention in the private sector, MassCare drove up total health insurance costs in Massachusetts by $4.311 billion.  Massachusetts individual health premiums are now the highest in the nation.   The other 92% are being forced to pay higher premiums for what is no longer “market-based insurance.”  The 8% that are “uninsured” were put on government programs, primarily Medicaid.  That’s exactly what Obama seeks to do with Obamacare.  The costs will be even higher once the federal government stops subsidizing Romneycare through extra Medicaid grants.

Green Border Security is as Effective as Green Energy

Energy productivity isn't the only thing that is hampered by laws governing so-called endangered species.  For decades, the Departments of Interior and Agriculture have encumbered border security operations with layers of environmental restrictions and regulations.  Additionally, the US Customs and Border Patrol (CBP) has been forced to pay millions in taxpayer dollars, known as mitigation funds, to offset the "environmental effects" of their roads, fences, and surveillance towers in or near national parks and other federally owned lands.  Now, Rep. Rob Bishop is seeking to exempt the border patrol agents from these laws, so they can focus on their real job – protecting the border.

Bishop's bill (H.R. 1505) prohibits the secretaries of Agriculture and Interior from impeding border security operations that are currently stymied by three dozen environmental regulations, including the Wilderness Act, National Environmental Policy Act, Clean Water Act, and the 1965 law known as the Solid Waste Disposal Act.  This bill allows CPB to construct roads and fences, use patrol vehicles, and set up monitoring equipment within on all federal lands within 100 miles of both the northern and southern borders.

The bill passed the Natural Resources Committee on a party line vote.  Now Republican leaders must schedule a floor vote on this vital legislation.

Romney Finally Getting Hit on Romneycare

While there is much needless focus on whether a Mormon can be elected, there is much less focus on whether the man who created the antecedent to Obamacare can win the Republican nomination.  Until recently, the Republican presidential field has largely left Romney unscathed.  That is about to change, as Rick Perry goes full throttle on Romneycare.  Here is his latest ad:

The Disgrace of MD Democrats' Gerrymandering

This week, the Maryland state legislature will meet in a special session to vote on the proposed changes to our congressional districts.  The map that the Democrats have proposed is arguably the most politically convoluted map in the country.  It disregards the demography and natural geographical boundaries of the entire central part of the state.  This will ultimately be decided in court.

Professor Todd Eberly at FreeState blogger has a great analysis of the proposed redistricting plan.  Here is his conclusion:

The House of Representatives was meant to be the most democratic of all federal institutions. It was meant to be the body where the diverse interests of the people mingled and produced compromise. It was to be the place where the baneful influence of factions would be countered and moderated. Gerrymandering subverts all of that and subjugates the interests of the people to the interests of political parties.

Perhaps it was  naive to have expected more from Governor O'Malley, but it certainly was not wrong to have expected better. I will confess to being a pretty liberal person (I know, a liberal college professor - shocking). I support a truly progressive tax code, I want the death penalty to end, I want single-payer national health insurance, I support marriage equality, and think we need comprehensive immigration reform with a path to citizenship and in-state tuition for the children of illegal immigrants. I know that all of these things will only happen if Democrats are the folks making the laws. But process matters, the ends can never be used to justify the means, and democracy demands that the diverse interests and beliefs of the people be represented. It is better to lose a fair fight, than to win a rigged game.

The proposed maps for Maryland, as well as the GOP proposed maps in states like Texas, are supreme acts of political cowardice. If Democrats and Republicans truly believed that their ideas, their vision for America, were more powerful there would be no need rig the system like this. Maps such as these, represent a clear acknowledgement by the parties that they do not believe they can win a fair fight in the battlefield of ideas.

The Handouts in the Tax Code that Nobody Wants to Discuss

The forgotten "30% club" that makes money off the tax system

For years, Democrats (and Republicans) have surreptitiously created dependency by manipulating the tax code.  Liberals often refer to handouts as tax cuts, and tax cuts as handouts to the rich.  To that end, they have perpetuated a travesty in which millions of people are able to obtain welfare payouts without ever applying for them.  Most people don’t even realize that they are receiving handouts because they view them as “tax credits.”  Accordingly, all efforts to eliminate these handouts are viewed as insidious tax increases.
These handouts are better known as refundable tax credits.

While most (conservative) commentators focus on the fact that 51% of tax filers paid no income taxes in 2009, the more egregious fact is that 30% of filers had a negative income tax liability.  Over 95% of these handouts came from the Earned Income Tax Credit (EITC) and the Additional Child Tax Credit (ACTC).  As part of the Stimulus, Obama created a third refundable credit; the Making Work Pay Tax Credit.

Here are the relevant statistics for those refundable tax credits in 2009 (CRS report):

All You Need to Know About Mitt Romney

in his own liberal words:

After a half century of robust growth in the conservative movement, it would be a travesty to nominate this guy.

Attrition Through Enforcement Immigration Policy Works in Alabama

Proponents of illegal immigration and open borders are constantly propagating a straw-man argument for amnesty that offers false policy choices.  They contend that "we cannot possibly send back the illegals without physically deporting every one of them, and therefore, we are forced to grant them amnesty, in addition to a 'pathway to citizenship.'  Those with some sense of sanity have always realized that the source of the problem is our incentivizing of illegal behavior, and that a concerted effort to enforce the laws would drain the illegal population through "attrition by enforcement."

Now Alabama is showing the rest of the country how we can solve the problem simply by enforcing the laws on the books, or, more accurately, performing the job that the federal government refuses to do.

Last Wednesday, federal district court Judge Sharon Blackburn refused the Obama administration's request to issue an injunction on the major provisions of Alabama's new immigration law (H.B. 56).  Consequently, state and local police are authorized to check the immigration status of those already apprehended for breaking a law or those caught driving without a license.  In addition to upholding the "Arizona SB 1070 provision," Judge Blackburn upheld the provision which requires every public school in Alabama to determine if an enrolling student was born outside the United States or is a child of an illegal alien.

Well, it didn't take long for the illegals to do the jobs that the Feds refuse to do; namely, self-deportation.  Fox News is reporting that many illegals are getting the message that it is a new day for the rule of law in Alabama:

Hispanic students have started vanishing from Alabama public schools in the wake of a court ruling that upheld the state's tough new law cracking down on illegal immigration.
Education officials say scores of immigrant families have withdrawn their children from classes or kept them home this week, afraid that sending the kids to school would draw attention from authorities.
There are no precise statewide numbers. But several districts with large immigrant enrollments -- from small towns to large urban districts -- reported a sudden exodus of children of Hispanic parents, some of whom told officials they planned to leave the state to avoid trouble with the law, which requires schools to check students' immigration status. (emphasis added)

Yes – indeed people vote with their feet.  They did the same thing in Arizona.  Even though SB 1070 was never implemented, roughly 100,000 illegals left the state.  The bottom line is that when they are not collecting $4.2 billion in refundable tax handouts, receiving some form of welfare on behalf of their American-born children, or obtaining employment, they will leave.

In that sense, even Obama has demonstrated attrition through the removal of incentives.  He has perpetuated joblessness and stagnation, engendering a sharp decline in illegal migration (CRS report p.3).  Not surprisingly, Texas, which has experienced an economic boom, is the only state with a growing population of illegals.  200,000 more illegals have invaded the Lone Star State from 2007-2009.  Now, if only we could actually remove the magnet without destroying our economy, we would solve the illegal problem without mass deportation or amnesty – or even worse, a pathway to citizenship.  In other words, treating illegals as illegal actually works.

Cross-posted to RedState.com

Joe Walsh as the Model for 2012 House Candidates

In order to 'fundamentally restore' America, we will need to win back the House and Senate in 2012, in addition to the White House.  Yes – you read that correctly.  We don't control the House yet.

There is a popular misconception that all of the 87 freshmen members are intrepid conservatives – members of the "Tea Party Congress."  Sadly, many of the newbies are 'business as usual' types.  As Erick pointed out last week, there are members like Martha Roby, who represent conservative districts, yet, they are anything but conservative.  We will continue to name names.  These uninspiring Republicans don't vote with the Democrats and cannot be classified as RINOs, but they are lock-step followers of leadership.  If we continue electing more of the play-it-safe crowd, we will never reverse the inexorable march toward socialism and fiscal insolvency.

On Tuesday, House leadership is planning to pass Harry Reid's CR with unanimous consent.  In other words, they will lock in spending levels and policies that completely void the House-passed "Ryan" budget – without any debate.  How ironic that Boehner is celebrating the one-year anniversary of the Pledge to America with this emphatic declaration: "we’ve kept that pledge, and will continue to keep our promise to the millions of Americans who remain out of work and the small businesses hamstrung by today’s economic uncertainty."  In the pledge, they promised to "fight the growth of government" and "efforts to fund the costly new healthcare law."  Well, this CR will continue $26.3 billion in funding for Obamacare, and will pave the road for an Omnibus bill in November that will grow the size of government.  It will also continue the solar energy loan program that led to Solar-gate.

All of this would not have been possible had we elected a real "Tea Party Congress" – one that would have challenged the status quo mentality of leadership.  Undoubtedly, it is quite arduous for a new member to challenge the agenda of leadership; however, it is precisely that sort of indomitability that we will need to restore this country to its constitutional roots.

Oil Will be the Future of Our Energy Production

While our government is pouring billions of dollars into impotent energy sources of corrupt Solar venture socialists, there are real enturopaners that are working on making American the Saudi Arabia of both oil and natural gas.  They are developing and revolutionizing fracking on the vast Bakken fields in North Dakota.  Stephen Moore put out a great article in the Weekend edition of the WSJ, detailing the success of Harald Hamm in developing the Bakken fields.

In the article, he references a conversation Mr. Hamm had with the president.  Here is how it went:

When it was Mr. Hamm's turn to talk briefly with President Obama, "I told him of the revolution in the oil and gas industry and how we have the capacity to produce enough oil to enable America to replace OPEC. I wanted to make sure he knew about this."
The president's reaction? "He turned to me and said, 'Oil and gas will be important for the next few years. But we need to go on to green and alternative energy. [Energy] Secretary [Steven] Chu has assured me that within five years, we can have a battery developed that will make a car with the equivalent of 130 miles per gallon.'" Mr. Hamm holds his head in his hands and says, "Even if you believed that, why would you want to stop oil and gas development? It was pretty disappointing."
Washington keeps "sticking a regulatory boot at our necks and then turns around and asks: 'Why aren't you creating more jobs,'" he says. He roils at the Interior Department delays of months and sometimes years to get permits for drilling. "These delays kill projects," he says. Even the Securities and Exchange Commission is now tightening the screws on the oil industry, requiring companies like Continental to report their production and federal royalties on thousands of individual leases under the Sarbanes-Oxley accounting rules. "I could go to jail because a local operator misreported the production in the field," he says.

It is men like Harold Hamm who truly embody the American spirit.  They don't receive any venture socialism monies from the government, yet the produce more than any of the corporate cronies could ever wish to accomplish.  Imagine how much more they could do if government would stop obstructing oil production.