Wednesday, December 29, 2010

The Business section today is depressing.

In the Review Journal business section today, there were 3 articles with bad news. The first was about home prices falling again. All major cities showed declines in home prices in October.

The second article was about Las Vegas loses 13,400 construction jobs. Construction employment grow or remained steady in 120 out of 337 large cities, but Las Vegas was not one of them.

The third article was about consumer confidence fading in December. It said that holiday spending surged this year, but Americans still have their doubts about the economy. This article also discusses home prices.

It is obvious that the economy is still in trouble. With the all government looking at raising taxes, how can the economy grow? People are losing the homes, jobs, and investments. How can they pay more taxes?

Tuesday, December 28, 2010

New beginning: Cut here, invest there

This Review Journal article is about cutting government spending. It tells about how the mayor of Atlanta solved an out of control budget. It states,
The politicians we need are what I’d call “pay-as-you-go progressives” — those who combine fiscal prudence with growth initiatives to make their cities, their states or our country great again. Everyone knows the first rule of holes: When you’re in one, stop digging. But people often forget the second rule of holes: You can only grow your way out. You can’t borrow your way out.

One of the best of this new breed of leaders is Atlanta’s inspiring mayor, 41-year-old Kasim Reed. A former Georgia state senator, Reed won Atlanta’s mayoral race in December 2009 by 714 votes. The day he took office, Atlanta had $7.4 million in reserves, an out-of-control budget and was laying off so many firefighters there were only three personnel on a truck, below national standards. A year later, it has $58 million in reserves, and Reed has a 70 percent approval rating — which he earned the hard way.

Then it tells how he did it.
Then Reed tackled the city’s biggest problem: runaway pensions, which were eating up 20 percent of tax revenues and are rising.

Reed couldn’t cut existing pensions without lawsuits, but he cut back pensions for all new employees to pre-2000 levels and raised the vesting period to 15 years from 10.

The article ends by saying,
In a recent address, Reed elaborated: “The bottom line is that for the country to do and to be what we have been ... there must be a generation tough enough to stick out its chin and take the hit. ... It is time to begin having the types of mature and honest conversations necessary to deal effectively with the new economic realities we are facing as a nation. We simply cannot keep kicking the can down the road.”

While I don't agree with all of the article, it does make a good point about how we must be willing to sacrifice and cut back.

Was Karl Marx a Founding Father?

This is a depressing article in the Review Journal about the lack of knowledge Americans have about the Bill of Rights. It states,
Americans are woefully ignorant, correctly answering questions about the document only 32 percent of the time.

Most revealing is that 42 percent of Americans believe the concept of "from each according to his ability, to each according to his needs" appears in one of the nation's founding documents, usually attributed to the Bill of Rights.

It is, of course, Karl Marx's central tenet for communism.

No wonder that this country is in such bad shape. The electorate is woefully uninformed and uneducated. Elections are being bought with big advertising dollars and the public is voting for the politician with the biggest budget.

Baby boomers face going bust in retirement

This article was in the Review Journal, but I could not find the link so I used this one. It points out that many have not prepared for retirement and states,
"The situation is extremely serious because baby boomers have not saved very effectively for retirement and are still retiring too early," says Olivia Mitchell, director of the Boettner Center for Pensions and Retirement Research at the University of Pennsylvania.

In another Review Journal article which is on the same topic, it states,
The oldest Baby Boomers turn 65 on Jan. 1. Then, each day of 2011 and for the next 19 years, 10,000 more will turn 65

This article points out surveys which show that the baby boomers are pessimistic about our county and the economy.

Unless the government reduces spending and eliminates regulatory agencies, we will have big financial problems.

Monday, December 27, 2010

Taxing the rich to solve the budget and other economic problems.

One article on taxing the rich, one article on what has happened when the rich were taxed, and one article on the blame for job losses show how the government is really the problem.

The first article states,
Two percent of the people in America control trillions of dollars and spend millions to get folks elected who will allow them to amass more.

Trickle-down economics never worked and it never will. Greed is a sickness, just like drug addiction and alcoholism.

This does make it sound like increasing the taxes on the rich is a good idea. However, consider this article which says,
Attempting to close its budget gap without doing what it should have done -- cut spending -- Oregon raised its "piggy-back" state income tax on the richest 2 percent of its residents last year.

As a result -- Nevada legislators, please note -- Oregon tax receipts are now ... falling. Receipts from the new tax fell from $180 million to $130 million in one year.

The article points out the the rich just either moved, moved their assets, or found other ways to avoid the tax.

Finally, the last article which says,
In her Dec. 14 letter, Joan Ivins blames our industry leaders’ greed for the loss of jobs to foreign countries. However, there is plenty of blame to go around to everyone, including:

1. Environmental laws have driven up costs of manufacturing and raw materials.

2. Safety requirements and training have increased costs and slowed production.

3. Foreign students are much more ambitious than ours, creating a superior workforce.

4. Foreign workers are willing to work harder and at a lesser wage.

5. Americans have come to expect a very high standard of living with little effort.

6. Unions have driven up wages and benefits without increasing production to a point when, combined with other factors, it is hard for manufacturers to compete.

The actual problem is government spending, taxing, regulating, and interfering in the economic process.

Wednesday, December 22, 2010

Many recruits too dumb for Army

This article is depressing. I had to use a non RJ link, but it is the same article. It states,
Nearly one-fourth of the students who try to join the U.S. Army fail its entrance exam, painting a grim picture of an education system that produces graduates who can't answer basic math, science and reading questions, according to a new study released Tuesday.

It continues,
The report by The Education Trust found that 23 percent of recent high school graduates don't get the minimum score needed on the enlistment test to join any branch of the military. Questions are often basic, such as: "If 2 plus x equals 4, what is the value of x?"

The military exam results are also worrisome because the test is given to a limited pool of people: Pentagon data shows that 75 percent of those aged 17 to 24 don't even qualify to take the test because they are physically unfit, have a criminal record or didn't graduate high school.

I advise you to read this entire article. We are failing our children in many ways. We are leaving them broke because they will be in debt to the government and uneducated so that they will not be prepared to earn a living.

We must stop babying our children and demand that they learn the curriculum before they can pass up to the next grade. We must not lower the standards of our schools so that we can pass every child.

Without an education, our children are doomed to poverty.

To revive economy, pull back red tape

This is another article that was in the Review Journal that I could not find a link in the RJ, so I am using this Washington Post link. This article is the effect of red tape on business expansion and about reducing the regulations. It states,
One reason often cited for this unwillingness to invest is executives' belief that Washington regulators are stifling fresh investment and discouraging innovation through new rules and requirements.

If Washington expects to partner with the private sector to lead the effort toward economic recovery, we must address the regulatory uncertainty felt by many of our small and large businesses.

I feel that this applies to the state level as well as the national level. We need to make Nevada more business friendly by reducing the red tape and restrictions faced by a new business.

In my opinion, it is not constitutional for a regulation agency to pass regulation which as actually laws. Congress is the only branch of the federal government that is given the power to pass laws by the Constitution. Congress should not give that power away.

Folly of belief in failed ideas

This was an article in the Sun. I could not find the link to the Sun article, but I found a link to the same article titled "When Zombies Win". It states,
When historians look back at 2008-10, what will puzzle them most, I believe, is the strange triumph of failed ideas. Free-market fundamentalists have been wrong about everything — yet they now dominate the political scene more thoroughly than ever.

I also believe that when historians look back at the century, what will puzzle them most is the strange triumph of failed ideas. The failed ideas that government can and should control the economy. Capitalism was responsible for the rise of the United States. When the government tried to control the ups and downs of the economic cycle, it created more problems than it solved.

The problems of today were caused by the government limiting the free market with rules and regulations. Even charities who are trying to help the poor and homeless have had to shut down due to government regulations.

Take the FDA. How many drugs have been approved that have resulted in lawsuits against the companies selling them? Shouldn't the FDA prevent harmful drugs from reaching the market place? Isn't that the reason that we have a FDA?

Take the Department of Education. Shouldn't education be better now that we have a Department of Education. An article in the Review Journal has the title."Many recruits too dumb for the Army". Our education is worse now than it was 60 years ago.

Government spending, taxing, and regulations are ruining this country.

Closing ranks

This Review Journal Article states,
Earlier this month, an audit of state contracts with current and former state employees revealed sweetheart deals that have led some lawmakers to suspect "criminal activity."

The irregularities include one employee billing the state for working 25 hours a day -- talk about dedication! -- and another receiving $350 an hour for a job usually rated at $65 an hour. The audit also found numerous cases when employees billed the state for doing contract work at times they were supposed to be working their regular state jobs.

Until waste like this is eliminated, the budget should not be increased.

The article continues,
If you listen closely, the snorting and foot-stomping you will now hear are the state bureaucratic equivalent of the way a herd of musk ox signal each other to form their defensive circle, with all horns pointing outward and each beast's unarmed posterior thus perfectly protected.

It is time to name names and fire the people who are responsible for this waste.

Health care and interstate commerce

This article was in the Review Journal, but I couldn't find the link so I used this one. It is about the legislature's abuse of the government's authority to regulate commerce. It states,
U.S. District Judge Henry E. Hudson took a stand for the principle that Congress may exercise only those powers that are specifically enumerated in the Constitution.

It's about time someone did. Over the years, the Supreme Court, acceding to the legislative branch's power grabs, has transformed a provision aimed at eliminating internal trade barriers into an all-purpose excuse for nearly anything Congress decides to do.

In 1942, for instance, the court ruled that the Commerce Clause authorized punishing a farmer for violating federal crop quotas by growing wheat for his own consumption. Although the grain never left his farm, let alone crossed state lines, the court reasoned that such self-sufficiency, writ large, had a "substantial economic effect" on interstate commerce in wheat.

I agree. We have let the government expand its power and authority to the point where soon the government will have control of our lives.

The article continues
In Obama's view, the failure to buy medical coverage can be treated as a federal offense because that failure, aggregated across millions of people, has a substantial effect on the interstate market in health care. But the same thing can be said of the failure to exercise, the failure to get enough sleep, the failure to brush your teeth, the failure to wear a coat in cold weather and the failure to eat a proper diet.

We must elect legislators who will uphold the Constitution as they swear to do when they take office.

Tuesday, December 14, 2010

Spreading wealth, trapping poor

This article in the Review Journal states,
There's an economic parable that has been floating around for several years that hits this nail on the head. It's titled: "The tax system explained in beer." There are a number of variations, but here's the quick version:

"Ten men go out for beer, and the bill comes to $100.

"They paid their bill the way Americans pay taxes.

"The first four men (the poorest) paid nothing. The fifth, $1. The sixth, $3. The seventh, $7. The eighth, $12. The ninth, $18. The 10th (the richest) paid $59.

"One day, the owner threw them a curve ball. 'Since you are good customers, I'm reducing the cost of your daily beer by $20.'

"The group still wanted to pay their bill the way Americans pay taxes. So the first four men were unaffected. They drank for free. But what about the other six men? How could they divide the $20 windfall so that everyone would get his fair share?

"They realized that $20 divided by six is $3.33. But if they subtracted that from everybody's share, then the fifth man and the sixth man would each end up being paid to drink his beer.

"So the bar owner suggested that it would be fair to reduce each man's bill by a higher percentage the poorer he was, to follow American tax principle.

"And so the fifth man, like the first four, now paid nothing (100 percent savings). The sixth now paid $2 instead of $3 (a savings of 33 percent). The seventh now paid $5 instead of $7 (28 percent savings). The eighth now paid $9 instead of $12 (25 percent savings). The ninth now paid $14 instead of $18 (22 percent savings). The 10th now paid $49 instead of $59 (16 percent savings).

"Each of the six was better off than before. And the first four continued to drink for free. But once outside the bar, the men began to compare their savings.

" 'I only got a dollar out of the $20 savings,' declared the sixth man. He pointed to the 10th man. 'But he got $10!'

" 'Yeah, that's right,' they all exclaimed, 'The wealthy get all the breaks. This new tax system exploits the poor!"

"The nine men surrounded the 10th and beat him up.

"The next night, the 10th man didn't show up for drinks, so the nine sat down and had their beers without him. But when it came time to pay the bill, they discovered they didn't have enough money between all of them for even half of the bill."

I know supporters of the president discount this as stupid spam. But there's truth behind it. When you "spread the wealth around" in this way, you legitimize citizen freeloaders. And that is most definitely not "good for everybody."

Supersized Government?

In this article in the Orlando Sentinel, it states,
People who wonder what America's budget problem is ultimately about should look to Europe. In the streets of Dublin, Athens and London, angry citizens are protesting government plans to cut programs and raise taxes. The social contract is being broken. People are furious; they feel betrayed.

Modern democracies have created a new morality. Government benefits, once conferred, cannot be revoked. People expect them and consider them property rights. Just as government cannot randomly confiscate property, it cannot withdraw benefits without violating a moral code.

The idea of individual responsibility has given way to government responsibility. A lady spills hot McDonald's coffee on her legs while driving and it is the McDonald's fault for not warning her.

As soon as something happens that we don't like, we ask the government to fix it. It is time that we take responsibility for our own actions.

The writer points out that,
If everyone feels morally entitled to existing benefits and tax breaks, public opinion will remain hopelessly muddled: desirous in the abstract of curbing budget deficits but adamant about keeping all of Social Security, Medicare and everything else. Politicians will be scared to make tough decisions for fear of voter reprisals.

How true. It will take courage and fortitude by the people and the politician to cut government spending. I fear that both qualities are lacking in most people and politicians.

Jobless-tax rate for employers raised

This article in the Review Journal states,
State Employment Security Division administrator Cindy Jones decided Tuesday to increase the average unemployment tax rate paid by employers by 50 percent starting in January.

Later, it states,
Because of Nevada's highest-in-the-nation unemployment rate of 14.2 percent, the state has had to borrow more than $579 million from the federal government in the past 14 months to keep paying the state portion of unemployment benefits.

It continues later saying,
Even with the higher rate, Jones expects the state to have to borrow an additional $250 million from the federal government by Sept. 30.

With Nevada's unemployment at the highest in the nation, the state is raising taxes on employers based on the wages paid. Employers will be looking for ways to reduce employees. They will not be trying to hire more.

The Nevada legislature will also be looking at additional taxes on businesses in their next session. No wonder Nevada has the largest unemployment in the nation.

I suggest that we pass immigration legislation similar to Arizona or Oklahoma. The money saved on health care and schooling of illegal aliens could be used instead of raising taxes.

Greenbacks ain't what they used to be

This article is about inflation and our fiat money. A reader sent a letter that said,
"No, our money is just fine, Vin," writes in one correspondent, answering my column of Nov. 21. "In spite of what the gold bugs would have you believe; the value of the dollar is still, historically and relatively speaking, at the place it was a century ago."

The author replied,
It's hard to believe anyone who's allowed unsupervised use of a computer can think the dollar is worth as much as it was a century ago -- or even 50 years ago, for that matter.

Later, the author states,
"No, our money is just fine, Vin," writes in one correspondent, answering my column of Nov. 21. "In spite of what the gold bugs would have you believe; the value of the dollar is still, historically and relatively speaking, at the place it was a century ago."

He continues,
Still, I suppose there's no convincing anyone who insists on believing their paper dollars have not lost value, that someone who was promised years ago their widow would be fine on a $2,000-a-year railroad pension was not cheated in any way by the banksters printing up all their new Monopoly money at the Federal Reserve.

The point is that fiat money is not real money and that when the United States stopped backing its money with gold, the people were being robbed of their savings.

The Federal Reserve has not prevented recessions or depressions like the government expected it to do. The Fed has actually caused more problems.

We need to get back to real silver and gold money. In fact, soon there will be an organization in Nevada that will provide a means to use real silver and gold money as currency as it should be used.

Potential costs of new law worry officials in Nevada

This is an interesting article in the Review Journal. It states,
The stakes are high for Nevada in the cases seeking to block implementation of the law overhauling health care.

If the law were struck down, it would save taxpayers in the economically depressed state as much as $574 million in costs to the state's general fund through 2019, according to the latest state estimates.

Wasn't this supposed to cut health care costs? You can not get something for nothing unless you live in socialistic country, but in the end, someone has to pay.

The article also states,
Hutchison is representing Nevada in the case pro bono. Nevada Attorney General Catherine Cortez Masto refused a directive from Gibbons to join the lawsuit, arguing that she thought the plaintiffs' case was frivolous.

Either the Attorney General was playing politics or she doesn't know her law because the case must have had merit since the ruling by U.S. District Judge Henry E. Hudson in Richmond, Va.declared the heart of the legislation is unconstitutional.

How did she get reelected? Even the Review Journal before the election said that she was a disappointment.

If the people of Nevada continue to vote by party instead of voting for the best candidate, we will continue to lose our liberty and freedom.

Saturday, December 4, 2010

Job licensing

This article in the Review Journal states,
Anyone who argues state government has been cut to the bone hasn't visited Nevada's website.

Clicking on the "Boards & Commissions" button reveals flab begging to be carved away. More than 160 panels are listed alphabetically. Most of them serve dubious purposes -- especially licensing boards that exist solely to deny low-skill workers the chance to earn a living while protecting regulated industries from new competition.

I wonder how many people died from a bad haircut before we had licensed barbers. How many people died from unlicensed landscapers? These licensing boards are also just a way for government to get more money.

The article continues,
With so many Nevadans unemployed, licensing standards make it extremely difficult for the jobless to start businesses, especially home-based ones. The state needs a culture of opportunity, not bureaucracy, to grow its battered economy.

If we want Nevada to grow and if we want to stimulate Nevada's economy, we must make it easier to do business in Nevada.

Obama proposes pay freeze

This article was in the Review Journal, but it is from the Washington Post. It states,
President Obama on Monday announced a two-year pay freeze for most of the 1.9 million civilians who work for the federal government, as he tried to address concerns over a mushrooming deficit and placate Republicans who have targeted the workforce for big cuts.

While I am against the federal government ordering pay freezes, since they are the employers, they have the right to determine the salaries of their employees. This is a very good idea.

The article also states,
The freeze, which must be approved by Congress, would be the first two-year halt to federal raises in modern history.

The private sector has had to deal with the economic slow down for several years. It is time that the federal government stops spending money that it doesn't have and starts to balance the expenses and income like the rest of us.

Cutting the national debt

This article in the Sun states,
Bowles and Simpson call for a wide range of cuts, including in Social Security, Medicare and the Defense Department. They suggest overhauling the tax code to reduce rates while eliminating many loopholes. And they also call for raising the gas tax to pay for roads.

Why aren't they suggesting the elimination of some ot the regulatory agencies which can create laws in violation of the Constitution? The Constitution says that only congress has the power to legislate.

It also states,
During the Bush administration, for example, the nation entered two wars, and the Republican Congress went on a spending spree — on credit. Republicans also pushed tax cuts, as they are doing now, but trickle-down economics doesn’t work — it has only added to the debt.

This statement is illogical. Just because the national debt increased during the Bush administration doesn't prove that tax cuts don't work. What it does prove is that increased government spending increases government debt.

Here is a novel concept. Control government spending. However, our politicians don't want to do that.