Wednesday, November 28, 2012

Move on, Conservatives!

You were right to fight Obamacare, right to fight legal challenges, right to fight state exchanges. Now move on, conservatives, and turn your intellectual energy to fixing the national health care mess, including Obamacare. That's essentially the message Avik Roy argues here and here. He suggests that once conservatives get over their grief, "they may realize Obamacare presents them with a counter-intuitive opportunity."

Drawing upon Switzerland's model — which uses health insurance exchanges and has NO government-run public option — Roy outlines a four-step plan.
  1. Leverage Obamacare's state government-run exchanges into market-oriented exchanges (with no government option) and repeal O'Care's "community rating" provisions so young people can afford insurance.
  2. Migrate Medicare enrollees (government's seniors plan) into exchanges and offer premium support (somewhat like the Paul Ryan plan).
  3. Accept that many employers will move away from providing insurance, so enable more people to buy insurance on their own via free-market exchanges.
  4. Move patients of Medicaid (government's welfare plan) — "America's worst health care program" — into exchanges to eliminate the disincentive they currently have to avoid work (for fear of losing Medicaid) and to ease the financial burden O'Care puts on states.
Read the whole argument. It's worth the intellectual energy.

The Tax Fight Begins

Only in the Land of Oz (or Obama) would this be "fair." Big business and small business could be pitted against each other in Obama's "over-$250K" tax hike demand. If nothing else, it shows just how insane the current tax code is.  Tim Cavanaugh explains,

Big Businesses
  • they file as Subchapter C corporations;
  • they include GE, IBM, Ford, Pepsi, etc.;
  • they pay a federal tax rate of 35%, but that's not their real rate because of countless loopholes carved out for certain industries: retail's real tax rate is an average 36.4%; most industries real rate is 26.6%; and 8 sectors (including finance/insurance, food services, and manufacturing) pay a mere 13.5% tax rate;
  • GE, by the way, paid a tax rate of zip-zero-nada in 2010; and
  • this group, often represented by the Business Roundtable, was invited to the White House recently to plead their case for lowering Subchapter C tax rate to 25%.
Small Businesses
  • they file as Subchapter S corporations (i.e., as partnerships or sole proprietorships);
  • they include your neighborhood hairdresser, deli, coffee shop, doctor, pet store, etc.;
  • they pay the same tax rate as individuals (not as a business) — 10%, 15%, 25%, 28%, 33% or 35% — but they get to claim individual deductions like you;
  • there are 26 million S corporations in the U.S, they employ 70 million people, and they account for the majority of business activity in the U.S.;
  • this group, often represented by the Chamber of Commerce, doesn't get invited to the White House;
  • Obama doesn't see them as businesses — just as 'rich people' — and he wants to raise their tax rates (if they earn more than $250K in a year) to 39.6% (from 35%) so they pay their "fair share."
Read Cavanaugh's article, and ask yourself:  how could any sane person think that raising small businesses' tax rate — while lowering big businesses' tax rate — is "fair"?

Wednesday, November 21, 2012

S.E. Cupp, Katie Pavlich: the Future of Conservatism

Columnists S.E. Cupp and Katie Pavlich (also editor of townhall.com) discussed the 2012 election results and the future of conservatism at the Conservative Women's Network in Washington DC, a monthly event co-sponsored by the Luce Institute and The Heritage Foundation. Watch below, or on YouTube

Fellowships for Print, Online Journalists

The Phillips Foundation is now accepting applications for its Robert Novak Journalism Fellowship Program, which offers full-time $50,000, and part-time $25,000, one-year fellowships to working journalists, with less than 10 years of professional experience in print or online journalism, who share their mission to advance constitutional principles, a democratic society and a vibrant free enterprise system. Applications must be postmarked by February 12, 2013. Contact John Farley or visit the website for more information.

Monday, November 19, 2012

California: #1 Welfare State

"Can conservatives prevent the U.S. from becoming California?" asks Conn Carroll. We'd better, or the nation will soon become the United States of Welfare and as unsustainable as Greece. Currently one-third of all the nation's welfare recipients live in California. Noting that middle-class, job-seeking families are fleeing California in droves, Carroll warns that if conservatives allow "what has happened to California happen to the rest of America ... middle-class families will have nowhere to go."

Gender Gap No; Marriage Gap Yes

Ignore the media hype about a Gender Gap, argues Kay Hymowitz at City Journal. It's really a Marriage Gap, and it isn't limited to gender: a majority of female and male marrieds voted Republican, while a majority of female and male singles voted Democrat.

Friday, November 16, 2012

Interactive "Soak-the-Rich" Calculator

The left loves to demonize large corporations and their CEOs as a greedy lot who should pay more taxes to reduce the federal debt. Now there's an interactive website, http://soaktherich.us, to calculate how much revenue the federal government would collect if it doubled corporate taxes and confiscated CEOs' pay of each, some, or all of the largest employers in 33 different U.S. industries, from aerospace to utilities. The results may surprise.

Thursday, November 15, 2012

Election May Not Save Obamacare

The left may be cheering Obama's reelection as protection for his signature achievement, but 6 major flaws may leave it so weak as to be unworkable in its present form, concludes NCPA's John Goodman:
[The flaws] are so serious that the Democrats are going to have to perform major surgery on the legislation in the next few years, even if all the Republicans do is stand by and twiddle their thumbs. Here is a brief overview.

Wednesday, November 14, 2012

Strange Voting Patterns

Investor's Business Daily editors pulled together just a few of the strange voting patterns spotted on election day in states with no voter ID requirements.

Pennsylvania — a state where a judge blocked a voter ID law for 2012 and "where 75 legal and credentialed GOP election workers were blocked or removed from the polls" — had 59 Philadelphia voting divisions report Obama 19,605 votes, Romney 0 votes.
The Obama Justice Department might not be concerned about that, but one man who studies voting patterns is dubious. University of Virginia political scientist Larry Sabato told the Philadelphia Inquirer that it deserves scrutiny. "Not a single vote for Romney or even an error?" he asked. "That's worth looking into."
Ohio — Romney faced a similar shutout in 9 districts in Cuyahoga County "where he did even worse than the third-party candidates."
Seem impossible? Yes, it does. And that's not just our opinion. Rich Exner, the Cleveland Plain Dealer's data analysis editor, said he doesn't find the shutout credible.
Colorado — two counties reported more votes cast than their total voter-age populations.

Federal Welfare Spending Now Single Largest Federal Expense

"Means-tested welfare spending is currently the single largest category of spending in the federal budget — more than Medicare, Social Security, and national defense," reports the GOP U.S. Senate Budget Committee. Citing a Congressional Research Service (CRS) report, the Committee said that federal and state spending on the 80-plus federal welfare programs is up 32% since 2008, now comprises 21% of federal outlays (spending), and amounts to roughly $1.03 trillion.

This doesn't count the Obama Phone, which is a separate welfare benefit paid for via fees assessed on those who pay for their telephone service:


Tuesday, November 13, 2012

What the "Fiscal Cliff" Means

In a tweet, it's bye-bye to those 'evil' Bush tax cuts and hello to across-the-board federal spending cuts and new taxes. Below is a list via AP, followed by an argument that the cliff could save us from a worse crisis.

Say goodbye to:
  • Bush's decade-old package of(1) cuts to lower marginal tax rates for everyone [rates below], (2) the elimination of the marriage penalty on working couples, (3)larger personal tax deductions for dependent children, (4) lower tax rates on dividends and capital gains, and (5) a variety of smaller tax cuts for businesses, research and development, and some state sales tax deductions;
  • Obama's temporary 2% cut in the paycheck FICA tax; and
  • Unemployment benefits for the long-term jobless.
Say hello to:
  • the imposition of the Alternative Minimum Tax on some 26 million households, which will raise their taxes by an average of $3,700;
  • a sharp cut in Medicare reimbursements to doctors taking care of grannies (the "doc fix");
  • the Sequestration: an automatic across-the-board cut next year of $55 billion in federal domestic programs, including another 2% cut to grannies' Medicare doctors; and $55 billion, 9% cut in defense spending.
(New taxes are also slated to begin in January 2013 to pay for Obamacare, but those are not part of the "fiscal cliff.")

Some see the fiscal cliff as the lesser of two evils. The economists @ idealtaxes.com blog argue:
The entire discussion of the "fiscal cliff" has things a bit backward. People talk of "going off" the fiscal cliff — and the natural image is of the disaster that awaits one who tumbles from the edge of a precipice. Instead, perhaps we should say "running into" the fiscal cliff — the cliff being a force that stops a tumble.

Running into a cliff isn't fun. It would raise nearly everyone's taxes. It would cut spending on most of the programs everyone uses. It would temporarily raise unemployment rates. But the fiscal cliff would back us away from a true disaster scenario, and it would slow the growth of the government debt.
While media focus on one warning from the Congressional Budget Office (CBO) report (i.e., that unemployment could go up if we hit the cliff), the authors argue a greater disaster awaits if the cliff doesn't slow the federal debt:
The media has been relatively quiet about the second paragraph of the CBO report -- that without fiscal responsibility, the U.S. economy faces imminent disaster. The CBO wrote:
If the fiscal tightening was removed and the policies that are currently in effect were kept in place indefinitely, a continued surge in federal debt during the rest of this decade and beyond would raise the risk of a fiscal crisis (in which the government would lose the ability to borrow money at affordable interest rates) and would eventually reduce the nation's output and income below what would occur if the fiscal tightening was allowed to take place as currently set by law.
The actual scenario is even worse than the CBO makes out.  If the U.S. national debt continues to explode, then, eventually, when the Federal Reserve raises interest rates to prevent inflation, the rising interest rates will greatly increase the interest component of the federal budget.

From then on, either alternative would be a disaster: (1) the federal government could default, or (2) the Federal Reserve could take the brakes off inflation. In either case, the dollar would collapse in the currency exchange markets, interest rates and import prices would go sky-high, and the U.S. standard of living would hit the bottom with a splat.
UPDATE: John Hinderaker breaks down the marginal tax rate changes.
  • Bush rate 35% goes up to Obama rate 39.6%
  • Bush rate 33%  ... to ... Obama rate 36%
  • Bush rate 28% ... to ... Obama rate 31%
  • Bush rate 25% ... to ... Obama rate 28%
  • Bush rate 10% ... to ... Obama rate 15%

Monday, November 12, 2012

Quote of the Day

from Steven Hayward @ powerline.com:
Well, how to begin?  What’s on your mind this week?  Perhaps we should start with H.L. Mencken, who once wrote that democracy is the theory that the people know what they want—and deserve to get it good and hard.

Or as New York Mayor Ed Koch put it, “The people have spoken . . . and they must be punished.”  I think that’s just been arranged.

Hispanics Vote Welfare - Not Immigration - Policy

Immigration policy isn't the key issue for Hispanics, explains Heather Macdonald at NRO. Welfare policy is. And conservatives can thank 'official and defacto immigration policy favoring low-skilled over high-skilled immigrants' for setting in motion a large wave of liberal voters seeking 'a more generous safety net, strong government intervention in the economy, and progressive taxation'.

MacDonald warns that the call for conservatives to 'discard their opposition to immigration amnesty' to enhance their electoral prospects is very misguided. She argues that California—a state undergoing a demographic revolution—is the wave of the future of the U.S., and it does not bode well for those who favor limited government and individual responsibility:
  • U.S.-born Hispanic households in California use welfare programs at twice the rate of native-born non-Hispanic households;
  • 1/4th of all Hispanics are poor in California, compared to a little over 1/10th of non-Hispanics;
  • nearly 7 in 10 poor children in the state are Hispanic;
  • 1 in 3 Hispanic children is poor, compared to less than 1 in 6 non-Hispanic children; and
  • the idea of the “social issues” Hispanic voter is a mirage. A majority of Hispanics now support gay marriage, a Pew Research Center poll from last month found. The Hispanic out-of-wedlock birth rate is 53 percent, about twice that of whites.
In Immigration: Turning the Tide, Dr. Barry R. Chiswick explains how the demographic revolution began:
The 1986 Immigration Reform and Control Act (IRCA) was sold to the American public as having two major features—amnesty which was to “wipe the slate clean” of undocumented workers, and employer sanctions which was to “keep the slate clean”—along with some increased border enforcement of the immigration law. Employer sanctions were intended to cut off the “jobs magnet” that attracted undocumented workers to the United States. Half of the political bargain was fulfilled.

Under its two major amnesty provisions legal status was granted to nearly 3 million undocumented individuals, nearly all of whom were low-skilled workers, and millions more have subsequently been able to immigrate as their relatives. It is noteworthy that while in 1986 the word “amnesty” was used outright, in the current political debate the “A” word is anathema to the proponents of what is euphemistically called “earned legalization.” This by itself is testimony to public perception of the failures of the 1986 Act.
Can the 'snowball effect' of low-skilled immigrants be reversed? Yes, but only with substantial change in immigration policy. In testimony before a previous Congress, Dr. Chiswick — a University of Illinois at Chicago economist with international expertise in researching the economics of immigration and minorities — argued that the 'current legal immigration system is not serving the best economic interests of the United States', and recommended these among several changes to legal immigration policies:
  • end the "nepotism" immigration policy system that encourages low-skilled workers to bring extended family to the U.S.; and
  • replace it with "skills-based" immigration policies, such as those adopted by Canada, Australia and New Zealand, that give preference to immigrants who are most likely — by their age, schooling, technical training and proficiency — to add value and strength to the U.S. economy and tax revenues (rather than drain from them).
Don't expect such economy-boosting policy changes to be made in the next four years, however.

Friday, November 9, 2012

What will Mainstream Media Do Now?

With the election over, MSM will now be forced to report serious issues they largely covered up during the campaign. IBD lists a few of the stories MSM will soon "discover."

The economy really does stink.
The press studiously ignored the ongoing economic catastrophe under Obama, while parading any "green shoot" they could find that suggested growth was around the corner.

Don't be surprised if, after the election, they start to notice that three years of subpar growth have left the middle class further behind and more mired in poverty, and created a vast pool of long-term unemployed.
Massive debt and entitlement crisis loom.
Despite four straight years of $1 trillion-plus deficits and a national debt that now exceeds total GDP, the media largely treated the debt crisis with a collective yawn.

Ditto the looming bankruptcy of Medicare and Social Security. These crises are nevertheless real and will have to be dealt with soon, a fact the press will almost certainly acknowledge after Nov. 6.
The debt ceiling is fast approaching.
The Treasury Dept. warned last week that it expects the government to reach its borrowing limit before the end of the year. Congress and the White House will have to deal with that just as they're trying to avoid the fiscal cliff.
ObamaCare is fundamentally flawed.
Reports are sure to appear pointing out the law's lack of cost controls, its adverse impact on doctors and hospitals, and the fact that, after spending $1.76 trillion, it will still leave 30 million uninsured.
Obama's deficit cutting plan won't work.
The press let the president get away with one of the biggest whoppers yet — that his tax hikes on "the rich" would be enough to pay for his spending binge and bring down the deficit $4 trillion. Obama's own budget proved this wasn't the case. And after the election, you can bet the media will be "shocked" to find that his numbers didn't add up.
Questions about Benghazi still remain.
After almost two full months spent burying the Benghazi story, expect the mainstream press to wake up and notice that, as the Washington Post admitted in an editorial last Friday, "a host of unanswered questions" remains. So far, only Fox News has bothered to pursue this story, but we expect that other outlets will pick up on it after the elections.

Thursday, November 8, 2012

Conservatives: Don't Panic

After Mitt Romney's loss, there's been plenty of talk about how demographic trends will require Republicans to move to the center if they want to capture the White House, writes John Merline at IBD. What's missing from all this handwringing is the fact that conservatives today account for a bigger share of voters than they did when Reagan won his 1980 landslide.

He uses exit polling data to make these points:
  • The country remains center-right:  In 1980, 32% of voters were conservative, according to exit polls at the time. By 1996, when Clinton won reelection, that share had risen to 33%. This year, exit polls show that 35% of voters are conservative, far more than 25% who identify themselves as liberal. The share of moderates has remained relatively steady at 40% to 45%.
  • Voters haven't suddenly decided they love big government. Voters who say government is doing too much climbed from 43% in 2008 to 51% in 2012. 
  • This election exposed a glaring disconnect between voters' ideology and the person they picked to run the country.  51% say the federal government is too big and does too much, 52% said the country is seriously off track; 63% said taxes should not be raised to help cut the deficit; and almost half want ObamaCare repealed either in whole or in part. Yet substantial portions of these conservative-leaning voters actually cast their ballots for Obama, the one candidate who opposes them on each of these issues.
Concludes Merline:
All this suggests that if conservatives want to win presidential elections, they don't need to dust off their "compassionate conservative" hats, or make peace with high taxes and an intrusive federal state.

They do, however, need to learn how to communicate with today's voters and help them understand how a limited federal government and a thriving private sector will deliver unmatched prosperity to everyone.
Read the full article here, and bookmark Investor's Business Daily for always reliably insightful articles.