February 25, 2018

Dining with Big Government

My article as originally published in American Thinker:

Government regulation is a hidden tax that now consumes an astonishing $1.9 trillion of the U.S. economy per year. I’m preaching to the choir here, but for those seeking ways to converse with others about how destructive and unnecessary most regulations are, try discussing the voluntary exchanges that occur while dining out at a favorite restaurant. People may go for the food, atmosphere, or for economic reasons, but they do so primarily out of self-interest. And neither local politician nor D.C. bureaucrat is needed to tell them where to go, what to eat, how much to eat, how to eat it or how much money to spend. If the food sucks, the service is terrible, if someone gets food poisoning, no form of regulation is needed to tell even low-info types it’s time to dine elsewhere.

Regulatory aficionados (such as Obama, Bloomberg, and Jonathan Gruber) think otherwise and believe we’re all too stupid to make everyday decisions on our own. And unfortunately, too many Americans appear to feel that much of this regulation is both necessary and innocuous. But people should understand that just as government regulation isn’t needed to “save” them from a terrible dining experience, the same holds true with regard to nearly all the voluntary transactions that occur within the marketplace, e.g., what size soda to buy; the securing of a payday loan; ensuring restaurant employees wash their hands; the amount of salt preferred in food or the minimum wage that is paid to an individual.

Additionally, those in support of being “protected” by the nanny-state should be aware the cost to society is even greater than what is easily seen (to borrow from Bastiat). Sure, it’s easy to envision the added expense of compliance: the permits; the mountains of paperwork; the time-consuming inspections or costly signage that regulations impose upon businesses. But what also needs to be visualized is the enormous, ever-growing army of unelected bureaucrats that politicians put in place to bring about and enforce all of this needless regulation.

So while dining out, it’s as if a large group of regulators are seated with us in the restaurant, unnecessarily making numerous decisions for the patrons, restaurant owners, employees, vendors, and about darn near everything else — bolted down or otherwise. These “public servants” consume resources as if they’re at an all-you-can-eat buffet, continually search for new things to regulate and compliance is never optional. In the end, it is “We the People” who are stuck paying the entire bill, part of which now ends up on the “credit card” for future generations to labor over.

The crux of the problem is that even if these regulators were to do as efficient a job as the free market — they can’t and don’t — they are merely “dining” at the expense of everyone else in the “restaurant.”  It’s impossible for society to truly “progress” when a growing number of unaccountable bureaucrats are gobbling up tax dollars for no reason and driving up product and service prices with an ever-growing number of superfluous dictates. Free markets (combined with equal protection under the law) are already self-regulating because unlike the DMV, Post Office or Amtrak, businesses that fail to modify bad or inefficient ways will eventually go out of business. So why then are we constantly being force-fed more and more of these redundant regulations?

The dirty little secret — the rancid meat statists attempt to heavily season over with the promise of Utopia — is that coupled with an entourage of hungry bureaucrats and cronies, top-down regulatory control enables folks like Hillary Clinton, Harry Reid, Barack Obama, and a host of status quo Republicans and Democrats to gain real power and become fantastically wealthy without ever having to provide anything of real economic value to society. Making a living in this way is a much easier task than having to provide a product or service to citizens (like a restaurant owner or the Koch brothers must do) who are able to freely vote yea or nay with their pocketbooks.

This is in part why the zip codes that surround the D.C. area have become among the wealthiest in the nation. All while the labor participation rate is at a thirty-year low, food stamp usage is near an all-time high, and more American small businesses are dying than being created.

The fact that government regulation isn’t needed to enjoy a night out at a restaurant should be a fairly easy concept to grasp. But we’re not just dining with big-government, we’re being forced to live with it on a nearly 24/7 basis. And as Governor Moonbeam (a connoisseur of all things regulatory) recently said while discussing California’s government-caused water shortages: “that’s the beauty of government, it doesn’t go away.”

Nanny-state regulations and the regulators who impose them won’t “go away” unless more Americans become enlightened and begin to lose their appetite for big-government.


Thomas Sowell Talks Taxes

Two must-read articles by Thomas Sowell:

The Invincible Lie

Part 1:

Anyone who wants to study the tricks of propaganda rhetoric has a rich source of examples in the statements of President Barack Obama. On Monday, July 9th, for example, he said that Republicans “believe that prosperity comes from the top down, so that if we spend trillions more on tax cuts for the wealthiest Americans, that that will somehow unleash jobs and economic growth.”

Let us begin with the word “spend.” Is the government “spending” money on people whenever it does not tax them as much as it can? Such convoluted reasoning would never pass muster if the mainstream media were not so determined to see no evil, hear no evil and speak no evil when it comes to Barack Obama.

Read the rest at The American Spectator

Part 2:

Nothing produces more of a sense of the futility of facts than seeing someone in the mass media repeating some notion that has been refuted innumerable times over the years.

On July 9th, on CNN’s program “The Situation Room” with Wolf Blitzer, commentator Gloria Borger discussed President Obama’s plan to continue the temporary extension of the tax rates established under the Bush administration — except for the top brackets, where Obama wanted the tax rates raised.

Ms. Borger said, “if you’re going to lower the tax rates, where are you going to get the money from?”

Read the rest at The American Spectator       

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Why High Tax Rates are Harmful

So what is the true cost of tax “fairness.”

Raising tax rates on upper-income earners is an appealing idea to many people. The President certainly hopes that it is. The most common argument against the idea is that it would diminish the incentive for business owners to invest, hire, and grow their businesses. Although that is all too true, it’s only one kind of damage done by high marginal tax rates. Even if we were not in a recession, more tax progressivity would still be a bad idea.

It’s well known that taxes reduce economic effort. If you want less of something, tax it. That, by itself, reduces wealth creation and economic growth. Less well recognized, however, is that high tax rates misdirect and misallocate economic activity.

Read the rest at The American Spectator    

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Marco Rubio on NPR

Marco Rubio does a good job conveying the conservative message to an NPR audience.

From The American Spectator:

As millions of NPR listeners made their way home in Thursday afternoon’s oppressive heat, their windows rolled up and AC on (incidentally allowing them to hear the radio more clearly), Florida Sen. Marco Rubio managed to achieve three important goals: 1. Sound simultaneously intelligent, principled, and likeable; 2. Make a principled case against raising taxes; 3. Make an equally principled case for compromising with the opposition to fix the nation’s federal budget mess before it becomes an irreversible disaster.

Read the rest at The American Spectator     

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Hoarding Tax Dollars

My article as originally published in American Thinker:   California is headed for the fiscal cliff even sooner than was expected, as the budget deficit has suddenly grown from a projected $9.2 billion to $16 billion. Governor Brown, who helped put California on its current unsustainable path during a prior term as governor, wants to raise taxes even higher, which will further cripple the economy of this already over-taxed state.

Of course, Brown and the Democrat-controlled legislature can’t find any legitimate areas where spending could be cut and instead threaten to slash spending for schools and public safety. This is akin to an alcoholic who, when confronted with a lower income, claims he can no longer feed his children while pushing a shopping cart full of booze toward the cash register.

I’m an electrical contractor in California, and if the level of construction activity is indicative of the health of an economy, this state is on its deathbed. I recently gained not only a tiny glimpse of the true state of the economy, but also another example of why California and the federal government are always broke, no matter how much additional money is confiscated in the form of taxes.

I was recently invited to a job walk for a very small residential remodel in a small Northern California city by one of the general contractors I frequently work with. It was for a federally funded city program that provides zero-interest, zero-payment 30-year “loans” for low-income households.

Given the size of this project (no more than $60K), what I first found striking was that there were eight general contractors present to compete for this small amount of work. This was the kind of project where if the economy were even remotely healthy, the owners would be forced to offer cash incentives just to get people to show up to offer a proposal. Not exactly a ringing endorsement for current economic conditions.

Once I set foot in the residence, I quickly forgot about the hordes of competitors surrounding me and was instead focused on conditions that made me think I was suddenly stuck within an episode of Hoarders. These were some of the worst living conditions I had ever personally witnessed. There were piles of junk everywhere, and the filth was unimaginable. One of the city inspectors even commented on how the owners had done a good job of cleaning things up so far and that we “should have seen it before,” but that some dumpsters would be brought out so the clean-up could be continued. I was totally shocked.

The existing bathroom, which was going to be remodeled, unfortunately had carpet on the floor. I say unfortunately because the stench of urine was almost unbearable as I surveyed the necessary electrical requirements. This is a house that should have had the doormat placed on the inside so that people could wipe their feet before returning to the outdoors.

The money for this program comes from HOME (Home Investment Partnerships Program) and is given to the cities by the State and to the State through HUD. A “low-income” family of four that lives in San Francisco County can earn up to $88,800 per year and still qualify for this program. The loans are secured by the property and are supposed to be repaid after 30 years of zero interest and zero payments.

While I question the validity of this program’s existence in the first place, why is taxpayer money being used to “improve” a property when it’s clear that the “investment” will be totally trashed once complete? Just because someone is poor doesn’t mean he doesn’t have the ability to take care of what he does own. And how many truly poor people own their own homes — in California?

As bad as the above scenario may sound, the situation gets even worse from a taxpayer’s perspective. City and county building departments have been hit hard by the housing bust, which means the associated government employees have much less work to do these days. A small “free-market” project like the one described would require the pulling of the appropriate permits, and after that, several inspections by building officials would take place once various milestones had been met. Even with residential projects much larger than this one, there is really no reason for a building official to come out for a job-site pre-bid meeting such as this.

This felt more like a job-walk for a large public works project, as there were no fewer than three building officials present at the meeting for this one tiny project. There may have been a fourth, but I’m not 100% positive. Believe me: there is no reason why one person couldn’t have handled this job-walk. There is no way permit fees alone could cover this level of involvement on the part of city employees.

So according to Governor Brown and the Democrat-controlled legislature, there is no room for austerity, yet we have federal money being given to the states to be handed out in the form of loans for “low-income” housing rehabilitations that are supposed to eventually be repaid (unless the “investment” is turned into a worthless pile of trash) and then recycled for the same purpose. But in addition to the initial cost to U.S. taxpayers, there are also the hidden costs that the state and local governments (which are already broke) are incurring as a result of this program. So what are the true costs to California? How many other examples of fraud, waste, and abuse are out there?

Federal, state, and local governments have been hoarding more and more of the taxpayers’ money, yet you won’t find a giant pile of this money stashed somewhere. The only thing that is truly piling up is an enormous mountain of debt.

Just a little something to think about the next time a politician tells you’re not paying your “fair share.”

California Teeters on the Edge (Update)

A stern warning for California — and from a Democrat.

‘California is God’s best moment,” says Joel Kotkin. “It’s the best place in the world to live.” Or at least it used to be.


Now, however, the Golden State’s fastest-growing entity is government and its biggest product is red tape. The first thing that comes to many American minds when you mention California isn’t Hollywood or tanned girls on a beach, but Greece. Many progressives in California take that as a compliment since Greeks are ostensibly happier. But as Mr. Kotkin notes, Californians are increasingly pursuing happiness elsewhere.

Read the whole thing at The Wall Street Journal   


More from Hot Air:

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Prosperity Lost?

So could it be done today?  Would it be worth doing today? 

Good MRC article:

…But Flagler invested at a time when there was no federal income tax or tax on profits, so he could easily afford great risk and very patient capital investment. He not only built Key West, he invested throughoutFlorida, and was a driving force in converting a minimally inhabited and minimally inhabitable swamp into a thriving state providing millions of jobs.

Today, everything Flagler did would be impossible due to hundreds of bureaucratic agencies’ thousands of laws, rules, regulations, licenses, interminable delays. It would be infinitely safer and more attractive for a man like Flagler to merely hoard his wealth and enjoy long years of leisurely retirement or to invest his capital outside theU.S.or in tech companies that place most of their jobs outside theU.S.– which is what the Henry Flaglers of today do. Warren Buffet recently bought a railroad, but that’s a very rare Flagler-like move these days.

Read the whole thing at Media Research Center       

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Forced Fairness

Government forced “fairness” always results in shared misery.  Good piece by John Stossel at Human Events:

President Obama says he wants to make society more fair. Advocates of big government believe fairness means taking from rich people and giving to others: poor people; or people who do things politicians approve of, like making “green” energy equipment (Solyndra); or old people (even rich ones) through Social Security and Medicare.

The idea that government can “make life fair” is intuitively appealing to people — at least until they think about it. I’ll try to help.

Read the whole thing at Human Events    

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Stop California Dreamin’ — It’s Time to Wake Up

Brown wants to double down on trying to tax us into prosperity defying all economic reason.

California Governor Jerry Brown’s answer to the State’s failing economy and crumbling tax revenue is to place a $6 billion tax increase initiative on the ballot to support K-12 public schools. He promises to only “temporarily” raise personal income rates by 25% on any of the rich folk who haven’t already left.

This would be really funny if I didn’t live in California.

And speaking of an improving economy, another electrical supply house just closed near my office. 

Read the rest at     

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Obama’s Corporate Tax Sleight-of-Hand

If there was ever an Administration that could truly benefit from the suspension of the First Amendment it would be this one.  Fortunately that’s not the case and people such as David Limbaugh are there to give up the secrets of Obama’s magic tricks.

 So we should all be grateful that President Obama is just now coming out for a corporate tax rate cut? But does anyone really believe he’s had a supply-side epiphany?

That this is an election year surely wouldn’t have anything to do with his apparent change of heart, would it? He’s been president for more than three years, and Republicans have been clamoring all that time for a reduction in the world’s second-highest corporate tax rate. So don’t you think that if Obama truly favored this, it would have happened long ago?

But there’s something more cynical about Obama’s new proposal. It wouldn’t operate as advertised.

Read the whole thing at      

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