With less than four months to go until Election Day, presumptive G.O.P. presidential candidate Mitt Romney spoke at the Bowling Green Community Center on Wednesday. It was the former Massachusetts governor’s second stop in the area that day, coming straight to Bowling Green from a $50,000-a-person fundraiser at the Toledo Club. An estimated 12,000 people joined the governor, so many that some were directed to an overflow room to hear him.

Ohio Gov. John Kasich introduced Romney, but not before endorsing him. After talking about Ohio’s newly discovered budget surplus, Kasich focused on Romney’s success at the 2002 Winter Olympics, an event in which he sat as the CEO. He also spoke about Romney’s ability to balance the Massachusetts’s state budget and touted his job creation ability. “We need people that know business creates jobs; this is our guy.”

When Romney took the stage, he was quick to use Ohio as a protocol for what needs to happen in D.C. “My optimism comes from states like these, that balance their budgets and create business-friendly environments. … These are the principles that we need in D.C.” He then focused on small business job creation and the failings of the Obama administration in relation to them. The former governor took the opportunity to lambaste policies like “Obamacare” and the Dodd-Frank Act and their negative effects for small businesses. He also spoke about the proposed increase in small business taxes from 35 percent to 40 percent, a reference to the looming Bush tax cuts set to expire on Jan. 1. Romney also took the opportunity to comment on President Obama’s remark about business creators. At a campaign stop last week, Obama had said that people who own businesses did not build them. To that point, Romney asked every business owner in attendance to stand and join him in protest of the remark.

In recent weeks, Romney has been pressured by Democrats and even select Republicans to release his tax returns from before 2010. Although the issue was never brought up, he did lay out a five-point plan for jump-starting the economy: tapping into domestic energy resources, increasing free trade, balancing the national budget, increasing students’ learning ability by decreasing the power of teachers’ unions, and reducing corporate tax rates.

The event ended with Romney taking some questions from the crowd. When asked if he would chose a tea party candidate to be his vice president, Romney stated that although he has not decided yet, his choice was no doubt going to be a conservative. When asked whether he could guarantee that Social Security would be available for the retired, Romney affirmed. Although he did not give a specific plan, Romney stated that for people older than the retirement age, Social Security and Medicare would be available. However he did note that both programs would need to be reformed to be sustainable for future generations. Finally, when asked about job training, Romney said that, to reform the programs he would give states more power to implement them, as well as food stamps and Medicaid.

Tags: Ben Osburn, Decision 2012, John Kasich, Mitt Romney, Opinion

This entry was posted on Friday, July 20th, 2012 at 1:08 am and is filed under Decision 2012, Opinion.
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The Syrian Uprising has not only proven to be a civil war, but an ongoing international conflict, one in which little rectitude has been shown. As part of the broader Arab Spring, the uprising started back in March 2011, when protestors flooded the Syrian streets calling for the resignation of Bashar al-Assad and the end of the Ba’ath Party’s rule. The violence has escalated ever since. Participation from the international community, namely the U.N., has convoluted the consensus process.

The insurgents, known as the Free Syrian Army, have been the driving force behind Assad’s fall. Former Syrian Air Force colonel Riad-al Assad leads the group. Assad, as well as the majority of the organization’s members, defected from the Syrian Armed Forces. The group is largely unorganized and has no political goals other than to throw Bashar from power. Though claiming not to be sectarian, the group has formed alliances with other segments of the population. One of them is the Alawis, a Syrian government opposition group who follows Shia Islam. They label members of the Syrian Army who pursue civilian attacks as being enemy combatants.

Bashar has been subject to international and domestic criticism for the past decade. He has been a vocal critic of the United States’ defense of Israel and been accused of providing aid to militant foes of that country. During the 2003 invasion of Iraq, Bashar had been accused by former U.S. General George Casey of financing the Iraqi insurgents. The bulk of the criticism from the Syrian people has been due to Bashar’s denial of basic human rights. The government impedes Syrian right to privacy by blocking the use of social networking sites and recording all comments left in Internet chat rooms. International travel is also banned for dissidents of the regime. A 2010 report released by The Human Rights Watch organization stated Bashar’s administration routinely murders, tortures and imprisons political opponents who speak against the regime, a process done with intentional secrecy.

Violence in the region has consistently risen. According the United Nations, nearly 10,000 people have died in the conflict, including children. Hundreds of civilians from human rights, political activist, and even media groups have been arrested during the uprising, many of which are accused of spying on behalf of opposition groups. The uprising had caused many to leave their homes and seek refuge in countries like Jordan and Turkey. An estimated 120,000 Syrians are in the process of moving.

Western nations as well as the Arab League have been condemning the use of violence against the protesters since the uprising’s start. Nations including Britain, Spain and Canada have cut ties to Bashar’s government, mostly in the form of economic aid. The Arab League and the United Nations have been the most successful in creating peace plans, though their implementation has been quelled. Working with the Arab League, the United Nations has been slow to impose sanctions against Syria due to lack of international consensus. China, and Russia have provided roadblocks to the process.

Both China and Russia vetoed U.N. measures that would have called for an Assad resignation and sanctions until the occurrence. The veto represents a continued stance taken by both nations in opposing Syrian intervention, be it military or a regime change. However, this declaration conflicts with reports that Russia, a long time Syrian ally, has been involved militarily in the conflict. Russian news reports released in previous months have stated that the country has both armed Syrian government supporters and has sent military ships to assist the Syrian army.

Conversely, both nations do support the U.N. created Peace Plan. The peace plan, spearheaded by Ghanaian diplomat Kofi Annan, was at one point considered the most viable plan to end the violence. The six-point plan called for a cease-fire and negotiations led by Annan to address both parties’ concerns. The plan, although initially agreed to by Bashar, deteriorated due to lack of the regime’s commitment. A new peace plan has been proposed by Annan to the United Nations.

Iran provides another obstacle for peace in Syria. The nation, another Syrian ally, has been indirectly involved in the conflict as well. Both the United States and the United Nations have accused the Iranians of funneling weapons to the Syrian army as well as intelligence. The involvement of Iran puts America and its U.N. allies in a conundrum. Iran is already under intense pressure from the international community because of its nuclear weapons program. Should the U.N. decide to seek further action against Iran because of this, it could escalate the Syrian conflict.

One thing that is for certain is that American or international military intervention does not appear to be in the future. A 60-nation meeting of the group Friends of Syria will discuss ways to, as Secretary of State Hilary Clinton calls it, “allow the transition to a democratic Syria to begin.” Those ways include further economic sanctions, but no use of military force. The United States sends humanitarian aid to the Syrian opposition. While some members of Congress have called for a more aggressive stance, including arms funneling and bombings, critics say the cost would too great and would lead to a lack of clarity as to how long the U.S. would be engaged in the conflict.

Tags: Arab Spring, Bashar al-Assad, Ben Osburn, Free Syrian Army, Opinion, Riad-al Assad, Syria

This entry was posted on Saturday, June 9th, 2012 at 3:12 am and is filed under Opinion.
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I have recently written a couple of pieces about the continuing (some would say mind-numbing, endless, and boring) debate going on in Congress over raising the debt ceiling. I have attempted to use humor and popular culture references, logic and reason, and even simplification of the subject to a single question to make it easier to understand. Perhaps however, it’s time to make this a class in basic Economics.

So let’s start with a simple premise. If an individual or family spends more than they take in, they go deeper into debt. If this process continues, they reach a point where it’s not only no longer possible to pay back the money they owe, it’s impossible to even pay back the interest on the money that they are forced to borrow in order to meet their obligations. This result is what’s actually meant by the default on a debt, something often better known as bankruptcy.

If a government follows the same path, they call it something far different (and seemingly more acceptable), deficit spending. As it goes for the individual or family however, so too does it follow for a nation. Continuing to spend beyond its means is a recipe for disaster that eventually reaches a point of no return.

Beyond this point, a government has two options to bail itself out. The first is to oppressively tax its citizens, in the misguided hope that they can beat the law of diminishing returns that will set in when they confiscate the capital that could otherwise be used to expand the economy (and the tax base) in order to pay their day-to-day bills. Inevitably, such practices increase the speed of the death spiral of that monetary system (often accompanied by a loud flushing sound).

The second method of irresponsible evasion is to run the government printing presses non-stop in order to create an inflationary spiral. If the value of the currency decreases, so too does the value of the debt incurred. While this works for a while; eventually the chickens come home to roost, usually about the time that a piece of paper currency with far too many zeros on it is required to purchase a loaf of bread.

In his book, “Applied Economics”, Thomas Sowell calls this ‘Stage One Thinking’, a practice of not thinking beyond the immediate consequence to the longer term effects of an action. While Congressional budgets are often rife with this behavior, this is not the only concept that seems to be misunderstood however. So since those in the government and media insist on misdirection or code words in their discussions of the subject, let’s clear up a few of the most important.

Revenue enhancements are tax increases! The only money that government has is what it gathers through taxation and tariff. The only way that government can enhance revenue is through taking more of it from its citizens. A spending cut is reduction in the amount of spending done. It’s not a reduction in the budgetary growth of a program or a reduction of a previously inflated budgetary number. Fair … Sorry. This word can simply no longer be allowed when talking about economics by either the government or the media. Neither should it be used in judgment of taxes or spending (and never with the word ‘share’). Its current definition has become more a product of emotion and ideology than one of objective fact. Somebody is just going to have to come up with a different measure of these subjects and a better descriptive term, since this one is damaged beyond repair.

Its past time for Congress in fact to stop using misapplied terminology and accounting tricks to hide their lack of backbone and economic acumen. It’s obvious that they don’t understand basic economics or we wouldn’t be in this jam in the first place. A little more plain language and bit less double bookkeeping (that would be illegal in the private sector) might be just what’s in order.

While we’re at it, can we please stop having them talk about 10-year budget reductions where no reducing happens for the first 3-5 years. Legislators need to show at least enough honesty to cut spending immediately when necessary, and while they’re still in office; and not (like the deficit) leave it to those who come after. It’s time to quit substituting ‘Wimpy Economics” for real budget debate, “I will gladly give you spending cuts Tuesday, for a tax increase today.” Such nonsense simply won’t cut any longer.

That’s Economics 101… class dismissed.

Tags: Just Blowing Smoke, Opinion, Tim Higgins

This entry was posted on Friday, July 22nd, 2011 at 4:00 pm and is filed under Just Blowing Smoke, Opinion.
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During his April 13 speech on the federal deficit, the President tried to prove the fallacy that tax cuts are an expense that must be paid for. To do this, he introduced a new unit of economic measure when he said, “They want to give people like me a $200,000 tax cut that’s paid for by asking 33 seniors each to pay $6,000 more in health costs.” Let’s call that $6,000 figure the ISHPI – Individual Senior Health (Care) Payment Increase. He wants to limit the ISHPI’s use to quantifying what he opposes; but let’s apply it to some of what he favors.

A week after this speech, the President had a campaign fundraiser in San Francisco. Price of a dinner was $35,800, or 5.967 ISHPIs. 85 people attended, for a total of $3,043,000, or 507.167 ISHPIs, raised. This means, by his own reasoning, that 507 senior citizens have to pay $6,000 more apiece in health care costs because this money went into the President’s campaign fund rather than to their assistance.

President Obama has taken more foreign trips than any of his predecessors in this time in office. Last fall, the National Taxpayers Union reported that it costs $181,757, or 30.293 ISHPIs, per hour to operate Air Force One. His 26-hour round trip between Washington and Bagram Air Force Base last December cost roughly $4,700,000, or 783.33 ISHPIs, just for the plane; and its costs are only a small part of the overall price tag of his jaunts. (In fairness, the claim that last fall’s trip to India cost $200,000,000, or 33,333.33 ISHPIs, per day was unverifiable and highly exaggerated; but then, Obama stated in 2008 that a hedge fund manager earns $580,000,000, or 9,666.67 ISHPIs, a year.)

The Porkulus bill of 2009 generated a fresh round of outrage this May when handouts of $24,000,000,000, or 4,000,000 ISHPIs, to 4,000 recipients owing $757,000,000 in unpaid payroll, corporate and other taxes were discovered. (Don’t pay taxes, and Obama gives you money at the expense of sick seniors.) When the Porkulus was passed, the Office of Management and Budget and the General Accountability Office identified $54,000,000,000, or 9,000,000 ISHPIs, in it that were allocated to programs these offices identified as ineffective or unable to pass muster in a financial audit.

So, between the cost of Air Force One for just one of many Presidential trips, Porkulus handouts to tax cheats, and the waste and redundancy that was initially – and only initially, letting alone what’s been discovered since – identified in the Porkuklus, President Obama has said to 13,033,033.33 senior citizens, “Well, tough luck – you’re on your own.” That quote is from his blatant misrepresentation four paragraphs prior in the speech of how the Ryan budget proposal would affect people in need of health insurance.

The Ryan proposal never cites dollar amounts for tax cuts; it only proposes a reduction of the marginal rate and broadening of the tax base. When applied to his own spending, the President’s idea of measuring the alleged “cost” of these lower marginal tax rates in terms of health care costs for senior citizens exposes the dishonesty and fraudulence of the comparison.

The President is far out on a very tenuous limb. To this day, he still argues from false comparisons and phony data. His claim this week that Social Security checks will be delayed unless the government is allowed to go even further into debt, after his spending more than doubled the deficit and pushed the government to the brink of default, cements his reputation as a liar and a demagogue.

Thomas Berry, for the Children of Liberty,www.meetup.com/The-children-of-liberty

Tags: Children of Liberty, Opinion, Thomas Berry

This entry was posted on Monday, July 18th, 2011 at 7:29 pm and is filed under Children of Liberty, Opinion.
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As the debate over raising the debt ceiling drags on longer than the line at the DMV to renew your driver’s license; politicians and pundits want to tell us what this debate is really all about. Of course, mostly what they try to tell us is who’s at fault and why not solving it will cause the sky to fall, dogs and cats to live together, and a financial meltdown that will make Chernobyl look like a camp fire.

I’d like to say that their statements are not driven by political agendas, entrenched ideology, and the desire to tell us in a way that won’t offend us that we are too stupid to understand what’s going on and what’s at stake here. If I did however, I’d be as guilty of misleading you as they are. For strangely enough, the problem is a pretty simple one: More or Less?

This issue has finally drawn the battle lines (though most seem unable to realize it), not only for debt ceiling debate and the coming election of 2012; but perhaps for many days to come. Do we want more or less government? Should we expect more or less from government? Should the US be doing more or less to ‘police’ countries unable to do so for themselves? Should we be doing more or less in the way of nation-building around the world? Perhaps most importantly to this discussion, should government spend more or less than it takes in?

We all know some of the arguments calling for more. In times of war and natural disaster, the government may find itself in a position where it simply must spend what’s required to fulfill its obligations to citizens. The world needs the US, as the beacon of freedom in the world, to come to the aid of those seeking it. We cannot stand idly by while those facing oppression or devastation are in need. The arguments for less can be just as compelling in the discussion however.

Setting aside that we don’t appear to fight ‘wars’ anymore, or at least ones where a formal ‘Declaration of War’ is voted on by Congress, we must face the fact that we have been engaged in military action continuously (actively or passively) since the beginning of WWII. Even if we concede that the President has the right to send troops into situations to protect US citizens or ‘vital interests’; this hardly makes the argument for basing troops around the world ‘just in case’, sending troops to fight at the request of the UN, or putting troops in harm’s way in the efforts of NATO not directly tied to the treaty obligations of this organization.

Coming to the aid of areas hit by earthquake, wind, fire, or flood in this country (and others) might reasonably be said to take precedence over military problems around the world. This nation has always been among the first to do so. Must we always accept the greatest responsibility in these efforts however?

Besides, there’s also no reason why doing any of these things might not also demand commensurate spending cuts in other places. When expending funds in military and humanitarian efforts, are we not also obligated to reduce spending (or at least the growth of spending) in other programs, in the name of fiscal responsibility? Should not such necessary aid bring an equal reduction in non-essential programs, ear-marked projects, and other discretionary spending as an offset?

And oh by the way, when did we redefine something as a ‘spending cut’ when all we are doing is reducing the rate of its growth? When did government programs take on a life of their own, granting them automatic increases in their budgets regardless of the rate of inflation or the fiscal state of the union? When did any attempt at such negligible growth reductions become ‘draconian’ in nature, a term ostensibly reserved for subtraction of a cruel or unusually severe nature.

But don’t look for the answers to any of these questions to come from the discussion going on in Washington, nor from the mainstream media punditry over the fiscal debate going on across the country. Look instead for some super-glue to hold duct tape onto the Band-Aid that covers the seeping wound of the national debt. Look as well, for the congratulatory back-patting, handshakes, and ‘job well done’ acknowledgment of legislators for whatever they do come up with; along with the mandatory “we wish we could have done more, if only the other side were willing to compromise” invective.

You should expect little more than this from those who can’t come up with up with the answer because they can’t or won’t understand the question: More or Less?

Tags: Just Blowing Smoke, Opinion, Tim Higgins

This entry was posted on Monday, July 18th, 2011 at 1:24 pm and is filed under Just Blowing Smoke, Opinion.
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First, a few disclaimers: I live in Wood County; I have a job where my housing is provided so I am not directly affected by increases in property taxes; and my wife works for the Toledo Metroparks system. With that out on the table, I would like to share a few thoughts about the decision made by the commissioners of my county to deny the Toledo Zoo’s request for a tax levy in Wood County.

I suspect they are right, a significant number of our county’s population, especially those in the southern end of our county would not support paying additional taxes for something that is so far, far, far away in Toledo. But I am not so sure one could make the argument that the zoo, or any other community amenity such as the Port of Toledo, the Airport, The Toledo Symphony, The Imagination Station, The Toledo Museum of Art and dare I say it … conflict of interest aside, the Toledo Metropark System does not benefit, in many ways, the broader region we might call Northwest Ohio.

I am curious how many times a mayor or a trustee or a commissioner in my fair county has included in their sales pitch to get a factory or a business to settle in my fair county, the fact that we are a ten to thirty to forty-five minute drive to all the treasures found in Toledo … such as the Zoo, the Port of Toledo, the Airport, The Toledo Symphony, The Imagination Station, The Toledo Museum of Art, and dare I say it … conflict of interest aside, the Toledo Metropark System. I am equally curious what would be the economic impact on my fair county if none of these things existed a short drive up I 75.

My point is very simple here, even if we do not make use of these amenities in our personal lives, their existence enriches us in many ways. They make our communities more attractive to others, they enrich the common good, and they elevate the culture around us. For those who can’t see anything but their pocket book or bank account, their existence makes our property more valuable.

I know we live in a difficult economic time. I know that we have been told that everyone from public education to public parks must do more with less. But that can only go so far. There is a tipping point where the cutting of personnel and services becomes too great that productivity and quality gets lost. The very integrity of the work suffers. I have lived in the Toledo area now for six years.

These things you have in your midst … the Zoo, the Port of Toledo, the Airport, The Toledo Symphony, The Imagination Station, The Toledo Museum of Art, and dare I say it … conflict of interest aside, the Toledo Metropark System are incredible gifts that benefit the lives of those who live on both sides of the Maumee. To suggest that people who live outside of Lucas County and yet derive benefit from these amenities do not have any obligation to the maintenance of their health and well-being because of the placement of a geographical boundary seems unfair and arbitrary.

Maybe the Wood County Commissioners are right, a tax levy for the Zoo is not the way to go. But we need to be clear here, what the Zoo is seeking from us in Wood County is not unreasonable. For years we have been reaping many benefits from being a neighbor to a metropolitan area that has given us great art and music, clean parks with fascinating historical and natural programing, a port to the world, and one of the finest Zoos in the region. Those of us who live on the other side of the river need to be thinking about claiming our fair share of the responsibility.

Eric McGlade is a United Methodist Pastor living in Bowling Green, Ohio

Tags: Eric McGlade, Opinion, The Communitarian Soul, Toledo Zoo, Wood County Commissioners

This entry was posted on Sunday, July 17th, 2011 at 6:50 am and is filed under Opinion, The Communitarian Soul.
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Not being the pop culture pundit that Michael Miller is, I find myself on foreign turf when using such references in writing about politics. I cannot help but be drawn to some rather obscure cinematic references however as I watch some of the debate going on in this country about raising the debt ceiling. This is not to say that we don’t expect more than a little theater in these days where speech writers and media consultants manage sound bites for elected officials far better than the major movie studios did for stars back in the day. Perhaps in fact, this media management makes it natural (and perhaps foreordained) that we draw such references to this latest national drama as it is being played out. Bear with me then, as I try to paint a rather confusing cinematic picture.

For starters we have the national debt itself, an imposing creature reminiscent of that in the 1958 classic “The Blob”, which grows to seemingly insurmountable size by swallowing every living thing it comes into contact with. Congress could certainly take some lessons from Steve McQueen, who seemed to understand that the only way to defeat such a creature is not by trying to kill it (which you can never do) but instead by trying to freeze it until it begins to shrink to a more manageable size.

To that, you can add a touch of Pat O’Brien playing “Knute Rockne All-American” from 1940, when the president delivers a classic half-time speech; informing both Congress and the public that it’s time to “pull off the Band-Aid” and “eat our peas”, before sending them out for the second half. (Perhaps his speech writers stumbled on these rather dubious references after seeing a similar comparison and determining that using, ‘winning one for the Gipper’ would fall far short of the mark; since that part in the movie was played by former Republican President Ronald Reagan.)

Throw in a healthy dose of the 1960 classic “Inherit the Wind” with legislators of both parties attempting to capture the spotlight by imitating the outstanding performance of Frederick March; and using belligerent pontification to define the principled stances of their own party, while demonizing those of their opponents as little more than political blasphemy.

Leaven in a dose of 1976’s Peter Finch performance as Howard Beale in “Network” to describe the reactions of most in the audience to the whole thing, that ‘they’re mad as hell, and they’re not going to take it any more’. And don’t forget to sprinkle in some of the shameless opportunism of Faye Dunaway, who sees the process as a chance to advance her own power and fortune; and the jaded disgust of William Holden’s character to represent those of us who have seen this kind of thing going on in Washington far too many times before to be moved by it.

Perhaps before we’re done, we’ll even be treated to a finale worthy of Cecil B DeMille’s “The Ten Commandments”, with the taxpayers being led out of the bondage of a trillion dollar deficit by the handing down of a compromise being written by fire in stone, and President Obama doing his best Charlton Heston performance as Moses handing down tablets worthy of the dramatic effort (and occasional over-acting) that has been exhibited.

Far more likely however, is that we will end up with an agreement in last moments of before the latest ‘deadline’ more like something from the 1974 Mel Brooks classic “Blazing Saddles”. I suspect that we could find a backroom in Washington DC where we will find a group of politicians mimicking Governor William J. LePetomane, as he informs the assembled cronies, “We have to protect our phony baloney jobs here, gentlemen! We must do something about this immediately! Immediately! Immediately! Harrumph! Harrumph! Harrumph!”

Tags: Just Blowing Smoke, Opinion, Tim Higgins

This entry was posted on Friday, July 15th, 2011 at 8:51 pm and is filed under Just Blowing Smoke, Opinion.
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Recent polls show the economy is the top issue for the 2012 election. With unemployment at roughly 9% and gas prices near historical highs, it’s no shock that voters are looking for a candidate that can help get the U.S. economy back on the path to growth and prosperity.

Throughout history markets have cycled up and down, that’s just the nature of the beast. Unfortunately our current situation is not due to economic cycles, but to greed, crony capitalism and horrendous policies coming out of Capitol Hill from both sides of the aisle.

It is more than clear that the policies being pursued are not working, and history has shown us that they will never work. Call it amnesia, call it arrogance, call it what you will, but this state of mind needs to be corrected in order to see real growth in the private sector. If only politicians and economists in Washington knew just how simple and easy it would be to correct the economy. The course of action is simplistic, but the impact to their back room deals and special interests would be devastating.

In any Capitalist society, consumers drive the economy. That’s not a thought or personal belief — it’s a fact of life. The consumer must have money in their pocket in order to spark demand for a given product or service. An excess supply of goods will not force consumers to buy and a heightened demand with no supply to match doesn’t help anyone either. The $14 Trillion question now is how do we spark demand? Simply put, we need to put more money back in the pockets of Americans … ALL Americans. Lower class, middle class, upper class, high class and no class, give consumers and businesses more money to spend. This will result not only in a push to buy consumer goods but business owners will likely reinvest profits into their inventories and maybe even job hiring. Increased demand from the consumer side will result in a need for increased supply which will be met by businesses hiring more laborers.

A counter-argument often heard is that this is not the case, the Bush stimulus being a prime example which did no good for the economy in the long run (remember, you got a check in the mail). The Bush stimulus can best be equated to a caffeine buzz. For a brief moment in time the economy saw an influx of cash and goods were being bought and all was well. However once the cash was spent and the buzz wore off, there was no more money in the pockets of the consumer to substantiate an increased supply.

Now that the problem has been identified we have to ask, how do we put more money back in Americans’ wallets? Again it is a very simple answer with potentially drastic consequences: we cut taxes across the board and lower government spending substantially.

Spending must be cut first so that less tax revenue will not contribute to increasing the budget deficit. Cap the corporate tax rate down to 25% max (35% is currently one of the highest in the world), allow corporations to repatriate funds without tax liabilities (i.e. GE’s money from Ireland coming back onshore), cut capital gains taxes, lower property taxes, and most importantly drop income tax by 5% per each bracket. This allows for corporations to have more cash to hire individuals and gives individuals more money to spend on goods and services.

As for government spending, funding for certain special interests and programs should be cut or removed altogether, but that is why these groups need to start looking to the private sector for donations instead of holding their hands out to the government. Charities are fantastic and need our help (keyword our, not the government’s), but when tax dollars are forcibly taken and distributed to certain causes, that no longer is charity, it is wealth redistribution. Besides, with all the extra cash put back in to the pockets of US consumers they will have plenty of money to donate to whatever causes they see fit instead of seeing their tax dollars go to hundreds of causes they find silly or insignificant.

Furthermore, I think our politicians in D.C. deserve a pay cut due to the mess they have gotten us in. Each member of the House of Representatives currently earns $174,000 a year, with Speaker, Majority and Minority leaders earning $223,500 a year and $193,400 for Party Leaders (legistorm.com, usgovinfo.about.com). That’s almost $77,000,000 a year just in salaries JUST for the US House of Representatives (excluding health benefits and retirement packages).

These policies that have been outlined are not extreme, radical or out of line; it is pure common sense and deductive reasoning. Everyone makes the economy out to be a fragile machine that could collapse at any moment, which is not the case whatsoever. If we truly want to boost the economy, see unemployment drop and GDP growth reach the 5%+ range, we must allow the consumer to keep more of their hard earned money, spend (or save) it as they see fit, and stop the federal government from frivolously spending your hard earned dollars.

Ben Treece is a 2009 Graduate from the University of Miami (FL), BBA International Finance and Marketing. He is a discretionary money manager with Treece Investment Advisory Corp (http://www.TreeceInvestments.com) and a stockbroker licensed with FINRA, working for Treece Financial Services Corp. The above information is the express opinion of Ben Treece and should not be construed as investment advice or used without outside verification.

Tags: Ben Treece, Economics 101, Opinion

This entry was posted on Friday, July 15th, 2011 at 5:06 am and is filed under Opinion.
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Guest Opinion by Douglas E. Schoen

Although President Obama continues to meet with top House and Senate Republicans in an effort to reach a budget agreement before the August 2nd deadline for raising the debt limit, it is unclear how far-reaching the final deal will be.

Obama wants to achieve the boldest possible package through an agreement that would save up to $4 trillion over the next decade, which would consist of large cuts in Medicare and other entitlement programs — while requiring new tax revenue. Meanwhile Republicans advocate for a more modest deal to avoid a default on the national debt that contains some spending cuts and has no tax increases.

Despite these differences the President and the Republicans have agreed that the nation’s budget problems must be addressed, and Medicare reform is a critical part of any agreement.

Throughout negotiations, it is critical that cuts to the Medicare program are responsible and productive. Medicare reform must still protect policies and programs that work while eliminating those that are no longer effective.

One productive Medicare program that must be kept intact is Part D, the prescription drug benefit program. Part D is the most cost-effective and successful entitlement program the federal government runs. Thanks to strong competition, the program costs the government and beneficiaries far less than initial projections. This year, the Congressional Budget Office (CBO) reduced its baseline 10-year spending projection for all of Medicare by $186 billion, two-thirds of which is accounted for by a reduction in Part D spending.

The Medicare Trustees report released this year says that this competition will continue to drive savings. Research shows that in the Part D program, the proportion of prescriptions filled with a generic drug has increased each year, as plans strive to keep premiums low.

While Medicare Part D is an example of an effective Medicare program, it is clear that not all Medicare policies and programs are as productive.

The Independent Payment Advisory Board (IPAB) that was created with the passage of last year’s health care law is one such provision that should be eliminated. Essentially, IPAB would allow an unelected board make binding “recommendations,” or rather, demands, to reduce Medicare spending.

IPAB is a threat to all Medicare beneficiaries. Proponents of the board argue that IPAB will lead to improved quality of care as a result of the cost-cutting measures it enacts in order to save. This is doubtful.

The board must make cuts that reach annual targets, and can only look at specific parts of the health care system when making these decisions. Standard line item cuts will result, only reinforcing systemic problems — not fixing them — meaning unsustainable savings.

Major changes in the Medicare program should be decided by elected officials who are held accountable for their decisions. IPAB’s arbitrary system lacks transparency and oversight.

Our political leaders should look at other ways to help reduce Medicare spending and increase savings as negotiations progress.

For example, increasing the savings mechanisms in the current health care law could be done by guaranteeing the law’s $500 billion worth of savings from reduced Medicare payments to health providers and insurers by accepting a “trigger” for further cost cutting if those savings don’t materialize.

Lawmakers could also cut subsidies for beneficiaries to buy supplemental “Medigap” insurance, and save $92 billion by 2021. While increasing premiums that beneficiaries pay for Medicare doctors’ coverage by just 10 percent would save $241 billion. Also, raising the eligibility age for Medicare to 67 from 65 would save $124 billion.

Employers and employees could be incentivized to select more cost-effective health plans by capping the tax exclusion of employer-provided health benefits in 2018, and then phasing it out over ten years. The exclusion of employer-provided health care benefits is the single largest tax expenditure. It is estimated to cost the government more than $1 trillion over the next five years.

Medicare’s copayment structure could be modernized with a deductible and out-of-pocket maximum that is indexed to increases in spending per beneficiary — saving about $14 billion through 2018.

Bundling Medicare’s payments for post-acute care to reduce costs and increase incentives for efficiency would result in cumulative budget savings from 2012 through 2018 of $5 billion.

There are many options lawmakers have to reform Medicare without resorting to drastic measures. Cuts must be made, but not at the expense of programs that work. Parts of the Medicare program that are effective must be left alone, while those that are not must be changed.

Douglas Schoen is a political strategist and author of Mad as Hell: How the Tea Party Movement is Fundamentally Remaking Our Two-Party System, published by Harper, an imprint of HarperCollins.

Tags: Douglas E. Schoen, Guest Opinion, Opinion

This entry was posted on Wednesday, July 13th, 2011 at 3:07 pm and is filed under Guest Opinion, Opinion.
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As the deadline for solving the political impasse over increasing debt limit that this nation can carry fast approaches, the president and lawmakers are looking at anything and everything to attempt to find an agreement that allows them to maintain the ‘full faith and credit of the United States’. Democrats however, appear adamantly opposed to any significant decrease spending without a corresponding increase in revenue (code words for higher taxes). For their part, Republicans are equally opposed to increasing taxes; taking the position that the nation faces a ‘spending’ problem, not a ‘revenue’ one. While I tend to agree with the latter rather than the former, any compromise will probably have to be achieved by nibbling around the edges of the debate and calling both sides a winner.

In attempts by both parties to appease their base, discussion turns to attempts to close ‘loopholes’ in the tax system to realize an increase in revenue without appearing to do so. Subsidies for ‘evil corporations’ are seen as potential targets, as are tax credits and accelerated depreciations granted to businesses for capital expenditures. Tax loopholes are not the only object in the crosshairs however, nor are discussions limited to corporate concerns.

Also under consideration is elimination of tax deductions for mortgage interest and charitable contributions. While the former certainly promises a setback to an already depressed housing market, the latter should be of far greater concern.

Such concern is not over the potential revenue realized; but over the concept that in trying financial times, government would discourage the charity of its citizens. We can certainly agree that such deductions will benefit those with more than with less. After all, they not only have more money to donate to charity; but based on the taxes they pay, more reason to seek such deductions. Certainly the result of such contributions has far more benefit for those less fortunate that it does for those with a fortune to give.

Likewise, few if any can argue that there are plenty of worthy charities out there to donate to. United Way, the Salvation Army and the Red Cross quickly come to mind as groups worthy of potential contribution for the commendable work they perform. Donating to a charity funding research seeking a cure to disease are similarly both worthy in effort and far too numerous to count.

But perhaps the attempt to close this loophole is not about the revenue however, but about removing the competition. After all, government is playing an increasing role in the distribution of donations to those in need; and they are not one to suffer contestation of situational primacy calmly. (If you don’t believe me, try delivering letters from door to door and see how far you get.) In fact, government is the only entity allowed to operate as a monopoly in this country. As such, they often look with far more than disdain at those choosing to dare to compete in their ‘reindeer games’.

Of course the other difference that we must take notice of in such discussions is that donations that the government hands out come from taxes, which are anything but voluntary. What the government lacks in altruism however, they more than make up for in the sheer volume of what they hand out. Welfare, Food Stamps, Subsidized Housing, and Unemployment Insurance could all be considered a form of government-sponsored charity; and their budgets are increasing every year.

Now we could argue endlessly (and perhaps pointlessly) over the responsibility that government has to ‘care’ for its citizens. While we were doing so however, we would likewise need to review the rampant waste and fraud that seems to follow every government program wherever it leads. We might also want to talk about the high administrative costs of programs administered under the auspices of well-paid government bureaucrats versus those of private charities.

What cannot and should not be disputed however is that a time of great need in this country, government is potentially seeking to remove encouragement from voluntary participation in charity. And while there is little doubt that the government-enforced variety will continue (and probably grow), such thinking is liable to leave many feeling uncharitable.

Tags: Just Blowing Smoke, Opinion, Tim Higgins

This entry was posted on Thursday, July 7th, 2011 at 3:52 pm and is filed under Just Blowing Smoke, Opinion.
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