Obama's Taxpayer-Funded Bus Tour
At LAT, "Pivoting from debt fight, Obama plans jobs-focused bus tour."
But see CNS News, "Taxpayers Will Pay for Obama Bus Tour of Battleground States, Says White House."
Double-Dip Recession May Be Returning
At New York Times:
Until recently, most observers believed the American economy was in a slow recovery, albeit one with very disappointing job growth. The official figures on gross domestic product showed the United States economy grew to a record size in the final three months of 2010, having erased the loss of 4.1 percent in G.D.P. from top to bottom.PREVIOUSLY: "Commerce Department Downward Revision on GDP Growth, 2007-2010."
Then last week the government announced its annual revision to the numbers for the last several years. New government surveys indicated Americans had spent less than previously estimated in 2009 and 2010 on a wide range of things, including food, clothing and computers. Tax returns showed Americans even cut back on gambling. The recession now appears to have been deeper — a top-to-bottom fall of 5.1 percent — and the recovery even less impressive. The economy is still smaller than it was in 2007.
In June, more American manufacturers said new orders fell than rose, according to a survey by the Institute for Supply Management. The margin was small, but the survey had shown rising orders for 24 consecutive months. Manufacturers in most European countries, including Germany and Britain, also reported weaker new orders.
RELATED: From Roger Simon, "Dow Down 500: Should Obama Resign?" (via Memeorandum).
'I Love Rich People'
We hurt ourselves by envying, over-taxing and slandering the rich. Anti-wealth public policies will only persuade independently wealthy Americans to shut down their businesses, stop hiring and retire early to their hammocks in the tropics. On the other hand, if we “love” the rich, we will receive the love back in the form of ample jobs, loans, innovations and investments.Come to think of it, I'm amazed at how infrequently we hear this argument. A great essay. (Via Linkiest.)
Debt Compromise
Check NYT on the debt ceiling debate, "Amid New Talks, Some Optimism on Debt Crisis."
And from LAT, "Congress 'very, very close' to debt-ceiling deal, Mitch McConnell says":
The Senate's top-ranking Republican said Sunday lawmakers are "very, very close" to an agreement to raise the nation's debt limit, as the Congress works to meet an imminent deadline to stave off an unprecedented federal default.Also at Bloomberg, "White House, Republicans Said to Reach Tentative Deal on U.S. Debt Ceiling." (Via Memeorandum.)
In separate interviews, Sen. Mitch McConnell (R-Ky.) indicated that progress had been made late Saturday in conversations between the White House and congressional leaders on a debt-ceiling plan that could meet with enough support from both parties to move to President Obama's desk by Aug. 2.
McConnell, on CNN's "State of the Union," described a $3 trillion package that included cuts in discretionary spending, caps on future spending and a vote on a Balanced Budget Amendment. A special joint committee would be formed to consider further cuts and entitlement reforms that could be put to a vote in Congress this fall.
The debt ceiling would be raised until after the 2012 presidential election – a key priority for Obama.
"This deal has not been finalized but I think we're very, very close to something I could comfortably recommend to my members, and I believe the Democratic leadership will be doing the same," McConnell said on CBS' "Face The Nation."
I'm going to look more closely at this deal in an update later. Some reports indicate that this is basically the same deal that House Republcans offered weeks ago, and thus Harry Reid and the White House placed America at risk for higher taxes. We know they want more taxes, but everyone's been talking about financial Armageddon, so it pisses me off even more to think about not only our bottomless pit of leftist collectivism, but the lengths of deceit progressives will go to maintain it.
More later ...
Economy Grew at Weak 1.3 Percent in Second Quarter
And at Sundries Shack, "Let’s Stop the Clubbing of America":
It’s not so much that President Obama has hamstrung the economy but that he’s methodically stalked it over the past two and a half years.And hear it from the Stalker-in-Chief himself:See also, Dan Riehl, "O'petulance: Master Barry's Childish Temperament," and Weasel Zippers, "Obama Demands Congress Give Him Debt Bill By Tuesday, Still Refusing To Come Up With His Own Plan…"
And now he’s clubbing it to death.
Boehner Still Rounding Up Support Ahead of Debt Vote
At New York Times, "Boehner Seems Confident of Passing House Debt Vote."
WASHINGTON — The House and Senate headed for a pivotal showdown on Thursday evening over how to cut spending and increase the debt limit before the federal government loses its ability to borrow.Lots at Memeorandum on this. And also at Los Angeles Times, "Boehner risking much by going to brink over debt."
House Republican leaders convened a closed-door party meeting Thursday and appeared confident of winning over holdouts to pass their plan, which would make $900 million in cuts, raise the debt ceiling for a few months, and come back for more of the same later. But Senate Democratic leaders said that if that happened they would waste no time rejecting the legislation.
The Senate majority leader, Harry Reid of Nevada, said Senate Democrats would move immediately Thursday night to set aside the House proposal if it wins passage and then take steps to force a vote on Mr. Reid’s own proposal to raise the debt limit through 2012 in exchange for more than $2 trillion in cuts.
“No Democrat will vote for a short-term Band-Aid that would put our economy at risk and put the nation back in this untenable situation a few short months from now,” Mr. Reid said.
Alabama Still Collecting Tax for Confederate Veterans
Via Thomas Ricks, "Alabama still collecting taxes to support Confederate pensioners."
And this is evidence that conservatives like taxes? See AP Newswire:
Despite fire-and-brimstone opposition to taxes among many in a state that still has "Heart of Dixie" on its license plates, officials never stopped collecting a property tax that once funded the Alabama Confederate Soldiers' Home, which closed 72 years ago. The tax now pays for Confederate Memorial Park, which sits on the same 102-acre tract where elderly veterans used to stroll.Seems to me that if a memorial park is important and valued, people will agree to be taxed to pay for it. And this is another example of the power of government to tilt toward corruption and malfeasance. A memorial park is worth it, but not at the expense of deceit. See the Gadsden Times, "Time to end this tax":
The tax once brought in millions for Confederate pensions, but lawmakers sliced up the levy and sent money elsewhere as the men and their wives died. No one has seriously challenged the continued use of the money for a memorial to the "Lost Cause," in part because few realize it exists; one long-serving black legislator who thought the tax had been done away with said he wants to eliminate state funding for the park.
We’re happy to see the park flourishing, and expect it to get a lot of business during the ongoing sesquicentennial celebration of the Civil War.
However, we question the fairness of this particular facility being subsidized to this level by the state — through a tax intended to pay for something that long ago ceased to exist — at a time when other historic tourist attractions in Alabama that receive money from the state’s General Fund are suffering because of budget cuts.
When those cuts were being formulated, Confederate history groups and others made it known they wanted the Mountain Creek park’s earmarked funding left alone, and it was. Support for the park is strong, so it’s likely to survive a vow by Rep. Alvin Holmes, D-Montgomery, to cut off its state money.
We don’t have an issue with the park getting state money, but it ought to come from the same pot similar attractions draw from.
Amazon Wants Voter Referendum to Decide Online Sales Tax
I hate government by ballot box, although this one's a referendum rather than initiative, so what the heck? Besides, I miss running Amazon at the blog, and Governor Brown's a blithering idiot.
Taxes Upon Taxes Upon...
So the fondest Washington hopes for a grand debt-limit deal have broken down over taxes. House Speaker John Boehner said late Saturday that he couldn't move ahead with a $4 trillion deal because President Obama was insisting on a $1 trillion tax increase, and the White House quickly denounced House Republicans for scuttling debt reduction and preventing "the very wealthiest and special interests from paying their fair share."Continue reading.
How dare Republicans not agree to break their campaign promises and raise taxes when the jobless rate is 9.2% and President Obama's economic recovery is in jeopardy?
We think Mr. Boehner is making the sensible choice. No one wants to reform the tax code more than we do, but passing a $1 trillion tax increase first on the promise of tax reform later is a political trap. If the President were really sincere about reform and a willingness to keep the top tax rate at or below 35%, he'd negotiate that at the same time he does a debt deal. Mr. Boehner will have a hard enough time getting any debt-limit increase through the House, much less one that raises tax rates.
Keep in mind that Mr. Obama has already signed the largest tax increase since 1993. While everyone focuses on the Bush tax rates that expire after 2012, other tax increases are already set to hit the economy thanks to the 2010 Affordable Care Act. As a refresher, here's a non-exhaustive list of ObamaCare's tax increases ...
The New York Times wants folks to believe otherwise, calling for "additional sources of revenue," but that's a laugh, after 28 months and trillions later:RELATED: From James Pethokoukis, "Goldman Sachs: Debt default is 'extremely unlikely'."
More on Amazon Affiliates
Somebody got a sweet deal — only $499! — on that piece of high-end home video equipment via one of the Amazon links here, which earned me a sweet $20 commission through the Amazon Associates program.And Robert shares this video of Jeff Bezos:
Meanwhile, I rarely link him but I'll break my rule to send readers to Little Green Footballs for some lulz. Charles Johnson is perterbed by Amazon's decision to pull out of the state, but not so much that Democrat tax hikes are destroying free enterprise in California.
Typical. Charles Johnson's a bleeding-heart progressive with psychological problems. No surprise he'd back big government over business.Anyway, Common Sense Political Thought has an entry, "Amazon.com going Galt Updated, Saturday morning."
And at Los Angeles Times, "Amazon, California play waiting game in sales tax fight":
Amazon.com Inc. is sticking by its vow not to collect California sales tax on Internet purchases — and state officials must decide what to do about it.More at that link above, but California officials are looking to novel ways at making this unconstitutional law work:
But the showdown over the new tax collection law that took effect Friday could be months away. Companies don't send the taxes to the state until the end of each quarter, which means the California Board of Equalization won't know officially about Amazon's refusal to collect them until Oct. 1.
The tax-collecting agency said Amazon accounts for about half the Internet sales in California from large out-of-state firms that, prior to the new law, did not have to collect sales tax for the state. It said the new law would capture about $317 million a year in sales taxes that previously went uncollected.
Amazon, based in Seattle, has said repeatedly that it would not collect the California sales tax, calling it an unconstitutional infringement on interstate commerce.
Such defiance sets up a major legal battle by this fall, though Amazon could first challenge the law in court, as it has in New York. It has lost a trial court ruling there and has an appeal pending.
Amazon is "going to fight in every state where it can fight," said Tracey G. Sellers, managing director of the Tampa, Fla., office of tax firm True Partners Consulting. "It's going to be years before this whole issue is settled" in the courts.
Amazon declined to say whether it would sue to overturn the new California statute, though state officials expect a lawsuit.
The new law also gives the Board of Equalization the authority to develop new theories that would establish a nexus or legal connection, making Amazon liable for collecting California sales taxes.As wee see fit? Gotcha.
"This swings the gate wide open to establish nexus as we see fit," said Betty Yee, a board member who spearheaded the agency's support for the law. But she acknowledged that any other theories the board devises would probably be tested in court.
California's Amazon Tax Driving Business — and People — Out of State
The natural result of California doing yet more to make the state uninhabitable for business comes at the end of the story. Californians who earned and spent money in California as part of the Internet remote sales ecosystem plan to move elsewhere:See also, Robert Stacy McCain, "Amazon Goes Galt, Cuts Off California to Avoid Internet Tax in Zimbabwe, U.S.A."One affiliate, Ken Rockwell of San Diego, the owner of a 12-year-old photography website, said he planned to move out of state. “Will it be Las Vegas or Scottsdale or Ensenada?” he said. “It’s a question of where, not if.”
There's a disgruntled former affiliate, at Fox News, "An Open Letter to Jeff Bezos On Terminating the Amazon Affiliate Program In California." It's interesting but unpersuasive. Taxes disrupt markets, and while affiliates are getting burned, it's not good business policy to be magnanimous. Competition is fierce. Tax systems vary by state and the U.S. Supreme Court has said out-of-state companies cannot be taxed without actual physical presence at the point of sale. This is not to discount the fairness issue, or arguments that Amazon market share enables it compete in sales tax markets. It's more than California is simply hostile to business. I've noted a couple of times recently how companies and individuals are fleeing the state. Jan Norman's "Small Business" column at the Orange County Register reports frequently on the uncompetitive marketplace for California firms. (See, for example, "O.C. manufacturer to move, create 270 jobs in D.C.") And she has this on Amazon's decision, "How do Amazon affiliates lose out?":
If the online retailer has a physical presence in California — such as Walmart or Target, which have been supporters of the new law — it must charge California sales tax from California buyers.RELATED: At Instapundit, "THEY REALLY DO SELL EVERYTHING AT AMAZON."
But many of these online retailers have no physical presence (stores, warehouses, headquarters etc.) in California. And they have not been collecting California sales tax.
Understand that retailers don’t pay sales tax. They collect it for the state or local government entity.
Brick and mortar retailers say they are at a big price disadvantage because they have to collect sales tax (as much as 10% in California right now) that online retailers don’t.
However, in 1992, the U.S. Supreme Court ruled that a state could only require retailers with some physical presence (stores, warehouses etc.) within the state’s borders to collect the sales tax.
So a California firm that only sells online must collect sales tax for California but not for the other 44 states that charge sales tax (5 states don’t charge sales tax). But an online retailer in Oregon, which has no sales tax, doesn’t have to add sales tax to any of its sales.
States have been trying to figure a way around that Supreme Court ruling ever since.
EXTRA: At Sundries Shack, "Clearing the Browser Tabs – Why Does California Hurt Its People Thursday Edition."
Jerry Brown's Budget Soap Opera
'All My Children" may be off the air, but the soap opera is still running in Sacramento. In the latest installment, Governor Jerry Brown divorced his fellow Democrats by vetoing their budget. Democrats and unions are furious and plotting revenge, while both sides blame the evil Republicans for refusing to sanction a referendum that would give voters a chance to endorse a tax increase.More at the link.
Where's Susan Lucci when you need her?
Mr. Brown deserves credit for vetoing the Democratic budget that reverted to Sacramento form to close a $9.6 billion deficit, deferring several billion dollars of bills into the future, borrowing from special funds, and raising the state's sales tax and vehicle registration fee without the constitutionally required supermajority vote. Even the Democratic treasurer warned that the state couldn't finance its short-term debt with such a risky plan, and Mr. Brown cashiered it.
Democrats are now blasting him for suggesting that an "all cuts" budget is the only alternative if Republicans won't agree to allow a vote on a five-year extension of what was supposed to be a temporary income tax surcharge, among other tax hikes. Democrats are frustrated because they expected Republicans to cave months ago. But Republicans have shown laudable discipline, and they know that their relevance in state politics hinges on extracting concessions from employee unions that will reduce the future cost of government.
Mr. Brown needs at least two GOP votes in each chamber to put the tax increases on the ballot. And Republican lawmakers have said for months that they're willing to do so in return for modest pension and regulatory reforms and a hard spending cap.
Unions are basically killing any deal, even one that includes GOP concessions to Jerry Brown tax increases.
RELATED: At Instapundit, "SHOCKER: Companies Leaving California In Record Numbers."
'Tax, Tax, Tax the Rich, Walker You F**king Son of a Bitch'
Via Althouse:And progressive extremism: "Photos: Protesters lock selves to Senate railing."
MediCare: Too Good to Last
“Social Security and Medicare Taxes and Benefits Over a Lifetime,” a study by C. Eugene Steuerle and Stephanie Rennane for the Urban Institute that was released in January, demonstrates quite vividly why senior citizens like Medicare so much. A single man earning the average wage, $43,100 in 2010 dollars, who retired in 2010 will pay an average of $55,000 in Medicare taxes over his lifetime and will receive $161,000 in Medicare benefits. A similarly situated woman will pay the same $55,000 in Medicare taxes but will get $181,000 in Medicare benefits (because women live longer than men). A one-earner couple in that situation, again paying $55,000 in Medicare taxes, would receive $342,000 in benefits. If you’re a Medicare recipient, why wouldn’t you think that the program as we know it is a great deal?That's the key nugget, but read it all. Democrats are getting a free ride on this politically, despite the fact that the GOP's got the honest approach to policy. As usual.
But, obviously, it’s not sustainable. With federal budget deficits soaring and worries about a national-debt crisis in our future rising, how is it possible to keep Medicare as we know it? If the federal government, over the long haul, isn’t in a position to make up the gap between what people are paying and the benefits they’re receiving, Medicare taxes have to go up, benefits have to be cut, or deductibles have to be raised on high-income retirees.
RELATED: See also Andrew McCarthy, "Not Entitled."
Progressives Take Aim at Bush Tax Cuts
Here's Think Progress, "Ten Years Of The Bush Tax Cuts." And here's Joan Walsh, who just got beaten up on Twitter over her attacks on Andrew Breitbart and Weinergate, "Happy anniversary: Bush tax cuts turn 10." Folks can go back and forth on this forever. The truth is that higher taxes stifle initiative and entrepreneurship, and small businesses are among the hardest hit. Besides, no single variable explains current growth trends, least of all the first round up Bush tax cuts on 2001. As Mark Murray points out, "Judging the Bush tax cuts -- 10 years later":
Chris Edwards, the director of tax policy studies at the libertarian-leaning Cato Institute, has a different take on the Bush tax cuts.See also Martin Feldstein, at Wall Street Journal, "The Economy Is Worse Than You Think":
Edwards says the 2001 cuts (which included lower individual tax rates) turned out to be less effective than the later ones enacted in 2003 (on dividends and capital gains). "Bush's cuts were half and half in my view."
He also contends that it's too simplistic to extrapolate from the last 10 years that tax cuts -- in general -- don't work. "So much goes on in the economy," Edwards said, referring to external events, trade policies, and spending. "Clinton's higher tax rate doesn't prove any kind of relationship."
The current crop of Republican presidential hopefuls are continuing to bet on lower taxes. In his speech at the University of Chicago today, former Minnesota Gov. Tim Pawlenty proposed decreasing individual income-tax rates to just two levels: 10% and 25%; 35% is the current top level. And he also called for a lower corporate-tax rate.
"Growing at 5% a year -- rather than at the current level of 1.8% -- would net us millions of new jobs," Pawlenty said. "How do we do it? In short, we create more economic growth by creating more economic freedom."
The policies of the Obama administration have led to the weak condition of the American economy. Growth during the coming year will be subpar at best, leaving high or rising levels of unemployment and underemployment.More at the link.
The drop in GDP growth to just 1.8% in the first quarter of 2011, from 3.1% in the final quarter of last year, understates the extent of the decline. Two-thirds of that 1.8% went into business inventories rather than sales to consumers or other final buyers. This means that final sales growth was at an annual rate of just 0.6% and the actual quarterly increase was just 0.15%—dangerously close to no rise at all. A sustained expansion cannot be built on inventory investment. It takes final sales to induce businesses to hire and to invest.
The picture is even gloomier if we look in more detail. Estimates of monthly GDP indicate that the only growth in the first quarter of 2011 was from February to March. After a temporary rise in March, the economy began sliding again in April, with declines in real wages, in durable-goods orders and manufacturing production, in existing home sales, and in real per-capita disposable incomes. It is not surprising that the index of leading indicators fell in April, only the second decline since it began to rise in the spring of 2009.
The data for May are beginning to arrive and are even worse than April's. They are marked by a collapse in payroll-employment gains; a higher unemployment rate; manufacturers' reports of slower orders and production; weak chain-store sales; and a sharp drop in consumer confidence.
How has the Obama administration contributed to this failure to achieve a robust and sustainable recovery?
The administration's most obvious failure was its misguided fiscal policies: the cash-for-clunkers subsidy for car buyers, the tax credit for first-time home buyers, and the $830 billion "stimulus" package. Cash-for-clunkers gave a temporary boost to motor-vehicle production but had no lasting impact on the economy. The home-buyer credit stimulated the demand for homes only temporarily.
As for the "stimulus" package, both its size and structure were inadequate to offset the enormous decline in aggregate demand. The fall in household wealth by the end of 2008 reduced the annual level of consumer spending by more than $500 billion. The drop in home building subtracted another $200 billion from GDP. The total GDP shortfall was therefore more than $700 billion. The Obama stimulus package that started at less than $300 billion in 2009 and reached a maximum of $400 billion in 2010 wouldn't have been big enough to fill the $700 billion annual GDP gap even if every dollar of the stimulus raised GDP by a dollar.
In fact, each dollar of extra deficit added much less than a dollar to GDP. Experience shows that the most cost-effective form of temporary fiscal stimulus is direct government spending. The most obvious way to achieve that in 2009 was to repair and replace the military equipment used in Iraq and Afghanistan that would otherwise have to be done in the future. But the Obama stimulus had nothing for the Defense Department. Instead, President Obama allowed the Democratic leadership in Congress to design a hodgepodge package of transfers to state and local governments, increased transfers to individuals, temporary tax cuts for lower-income taxpayers, etc. So we got a bigger deficit without economic growth.
The bottom line is that the economy will continue to stagnate until the Democrats cut spending and lower taxes to spur entrepreneurship and investment.
Soak the High Achieving Students
Mary Katharine Ham — 'A Taxpayer Can Dream: My Special Day with the IRS'
Tax Day Rallies in Mission Viejo and Oceanside — Stop Spending Money!
There's some mainstream media coverage of yesterday's tea parties in Mission Viejo and Oceanside.
Here's the scene at La Paz Road and Marguerite Parkway yesterday:
Folks might want to stay with this message, or Think Progress will be all over it:
Ted Hayes, self-described "Black U.S. Citizen Patriot," was in the house. Folks might remember Ted from my coverage of the Arizona rallies last year:
Some folks want Donald Trump to dump the Obama Chump:
Oceanside's hard to beat for beautiful tea party locations:
Here's the lady who wanted my picture with her tea party sign. That was also a first:
Here's the shot I'm talking about:
This guy was hard to miss. He obviously spoke for a lot of people:
Those signs read "Project 2012 - Vote." Folks talked a lot about November 2012, "the most important election ever" (again). People just want to get that sucker out:
Rick Roberts, a popular San Diego talk radio personality, gave the keynote speech. A great guy and a real patriot: