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Pay for Performance: the Logical Extension, by Monique Chartier
Under the Government's Wing
9:51 PM, 03/31/09
Justification for Being Upset?, by Justin Katz
Mainstream Media
7:49 PM, 03/31/09
House Judiciary Committee Throws a Spanner into Voter ID, by Monique Chartier
Election Reform
4:04 PM, 03/31/09
What Makes a Life?, by Justin Katz
Culture
1:57 PM, 03/31/09
Councilman Emilio Navarro on the Cranston Police Contract, by Carroll Andrew Morse
Cranston
12:05 PM, 03/31/09
Funding Cranston, by Carroll Andrew Morse
Cranston
11:05 AM, 03/31/09
Soft Appeasement in the Service of Evil, by Justin Katz
Culture
9:56 AM, 03/31/09
Anchor Rising's Top 10 Right-of-Center Rhode Islanders: 10, 9, 8, by Justin Katz
Conservatism
5:55 AM, 03/31/09
A Special Town Council Meeting, by Justin Katz
Tiverton
7:25 PM, 03/30/09
High Budget Noon in Cranston, by Carroll Andrew Morse
Cranston
7:08 PM, 03/30/09
March 31, 2009
Pay for Performance: the Logical Extension
Thanks to WPRO's Matt Allen for the heads-up about the "Pay for Performance Act of 2009" bill that got voted out of Elmer Fudd's ... er, Barney Frank's committee last week. Byron York at the Washington Examiner reports.
But now, in a little-noticed move, the House Financial Services Committee, led by chairman Barney Frank, has approved a measure that would, in some key ways, go beyond the most draconian features of the original AIG bill. The new legislation, the "Pay for Performance Act of 2009," would impose government controls on the pay of all employees -- not just top executives -- of companies that have received a capital investment from the U.S. government. It would, like the tax measure, be retroactive, changing the terms of compensation agreements already in place.
NewsBusters' Tom Blume points out why this bill is a really bad idea.
Geez, it wouldn't be much of a stretch to extend Geithner's reach to:- Any company with a Small Business Administration loan.
- Any university with students who have borrowed money from the government to attend (i.e., almost every institution of higher learning in the US).
- Any company whose employees use government services (i.e., an interstate highway or a subsidized mass-transit ride) to get to work.That is, it's not a very far trip to controlling everyone's earnings.
So, responding to this amazingly bad idea, Matt Allen this evening proposed a trade: we allow the government to void those contracts and retroactively set those wages; in exchange, we get to open all state and local collective bargaining contracts touched by TARP or stimulus money and adjust the compensation therein.
I would go one step further. No trade is necessary. If Barney's bill (did I mention what a bad idea it is?) does become law, it enables exactly what Matt proposes. We could reach back and retroactively adjust public employee contracts. And not just contracts that get TARP or federal stimulus money. State and municipal contracts are funded with public tax dollars, the same type of funds as TARP and stimulus money. Barney's Law could become the precedent for all states and municipalities to unilaterally revisit their contracts across the board. No trade, bankruptcy or court order needed.
As Matt said, "Who's in?"
Justification for Being Upset?
In a comment to Harriet Lloyd's Engaged Citizen piece decrying the lack of press coverage of Rhode Island Statewide Coalition's recent meeting, an anonymous reader suggested:
I don't remember the Journal or any local papers covering any other special interest group's "Annual Winter Meeting" either. Until that happens, I'm not sure you have much to be upset about.
Well, it looks like Harriet can now feel free to be upset (emphasis added):
The state is losing the war on homelessness, leaders of the Rhode Island Coalition for the Homeless said at the organization's annual awards luncheon Monday.
House Judiciary Committee Throws a Spanner into Voter ID
Chairman Lally and the House Judiciary Committee have voted to hold Bill H 5097 "AN ACT RELATING TO ELECTIONS - VOTER IDENTIFICATION" over "for further study". The vote to do so was thirteen to one; the one "nay" was Rep Rod Driver.
What aspect of this concept might still need to be studied?
Let's see, there's the question of necessity.
The lack of a photo ID system creates the perception of voter fraud, shakes voter confidence and leads to lack of voter participation
Some of us would have stated the case a little more strongly than Secretary of State Mollis in 2007 by omitting the words "the perception of" and by appending a long list of instances of voter fraud, including here in Rhode Island. Excessive tact aside, does the Committee disagree with the substance of the Secretary's statement?
Secondly, the potential that a financial burden might be placed on the voter by this new law. Ah, but Section 2(a) of the bill stipulates that
voter identification cards will be issued upon request, and at no expense to the voters ...... to provide voter identification cards to those voters who do not possess the identification listed in subdivision (a)(1) and (2) above.
Thirdly, constitutionality. But surely the Committee would be pleased to learn that the US Supreme Court settled that issue last year in Crawford v. Marion County Election Board when they affirmed the State of Indiana's voter identification law. In the main opinion, Justice John Paul Stevens wrote
The application of the statute to the vast majority of Indiana voters is amply justified by the valid interest in protecting the integrity and reliability of the electoral process
Necessity, cost, constitutionality - fully studied and answered. Why wasn't this bill given the green light to be voted on by the full House? Doesn't Rhode Island's electoral process deserve the same "integrity and reliability" as Indiana's?
What Makes a Life?
Charles Murray's piece appearing in yesterday's Providence Journal is sure to spark distinct lines between people of different worldviews:
The stuff of life — the elemental events surrounding birth, death, raising children, fulfilling one’s personal potential, dealing with adversity, intimate relationships — occurs within just four institutions: family, community, vocation and faith. Seen in this light, the goal of social policy is to ensure that those institutions are robust and vital. The European model doesn't do that. It enfeebles every single one of them.Drive through rural Sweden, as I did a few years ago. In every town was a beautiful Lutheran church, freshly painted, on meticulously tended grounds, all subsidized by the Swedish government. And the churches are empty. Including on Sundays. The nations of Scandinavia and Western Europe pride themselves on their "child-friendly" policies, providing generous child allowances, free day-care centers and long maternity leaves. Those same countries have fertility rates far below replacement and plunging marriage rates. They are countries where jobs are most carefully protected by government regulation and mandated benefits are most lavish. And with only a few exceptions, they are countries where work is most often seen as a necessary evil, and where the proportions of people who say they love their jobs are the lowest. ...
... It conformed to both journalistic and scholarly accounts of a spreading European mentality that goes something like this: Human beings are a collection of chemicals that activate and, after a period of time, deactivate. The purpose of life is to wile away the intervening time as pleasantly as possible.
Councilman Emilio Navarro on the Cranston Police Contract
Readers may be aware that I have been somewhat critical of the Cranston City Council's tabling of the police union contract recently negotiated by Mayor Allan Fung. Since I believe it's flat-out wimpy to be in a room with officials you have recently criticized without offering them a chance to respond, after last night's City Council meeting, I asked several of the Councilmen if they'd be interested in answering an open-ended question on the subject of the police contract.
Ward 2 Councilman and City Council Finance Chair Emilio Navarro was willing to offer the following detailed response…
Cranston City Councilman Emilio Navarro: One of the main issues is the holiday mandate. The proposal is for some up-front cash to be given up on 3 holidays. It is an immediate savings, but the Mayor also agreed with the police union to give them 48 hours of comp time for those holidays, a total of 16 hours for each one. So we’re eventually going to have to pay that comp time down the road, 48 hours for 148 police officers. There's an immediate giveback from the union, but eventually the city is going to have to pay it back.
There are also raises in the contract. There’s a raise in the second year, which is 1.5% and a raise in the third year which is 2.9% if I’m not mistaken. A big part of the savings that the Mayor is touting in the police contract is 1.2 million dollars of vacancies. Right now there are 5 existing vacancies, with a potential of 5 more, with police officers that may retire. When you calculate the raises and you calculate the $1.2 million, it all washes out, and you basically have a net savings of about $200,000 overall. There’s also a clothing allowance that the police are giving back in the first year, but that’s the only monies we're getting that don’t involve some kind of payback down the road at the end of the contract.
AR: Do you think there's any merit to the Mayor's position that because last year's council budgeted for a salary freeze, he has to get the concessions?
EN: He could choose to budget it or not, but the bottom line is that Mayor wants to have an agreement with the union where they’re going to agree to freeze five vacancies, or else he says the union will force him to hire 5. Now look at the situation we’re in. We’re in some very, very tough economic times. All he is doing is creating what I’ll call a structural deficit, because those five and up to ten positions carry to the end of the contract and all it’s doing is making the Mayor not have to budget for those positions right now. Obviously, the money is not there. At the end of the contract, the Mayor is saying we can renegotiate the contract, but the union will be coming into negotiations strong with up to 10 vacancies. They’ll be able to say we’ll be able to force you to hire 10. So how are we going to get any givebacks from the union, when we’re negotiating from a weak point?
Here’s another fundamental change that I think needs to happen, and that I put forth. If we got all of the bargaining units to a 20% co-pay with no cap, I project through fiscal year 2012 that the City would save over 16 million dollars. Now, this is something I think is just sharing the burden with the rest of the taxpayers and what’s going on in their lives everyday, where they’re paying a 20% co-share.
And the Mayor’s savings is not 15%. There’s no percentage savings co-share here. This is a flat fee. They’re going from $25 to $30 for this current budget and for a family plan from $35 to $40. That’s a flat fee, not a percentage. The Mayor equated the $40 to what our 15% is now, but as the cost of health insurance goes up every year, in the third year, they will really be paying a 13% co-share, because there is a cap. What needs to happen is that we need to eliminate the caps from these exiting co-shares, because the taxpayer is bearing the burden when the cost of health care goes up. That’s a fundamental change that needs to happen throughout all of the bargaining units, in order to start stabilizing the financial situation of the City, long term, for my kids and my kids’ kids. We really need to make these kinds of structural changes.
Another structural change that I think they Mayor had an opportunity to do is with new hires. Let’s bring them in in the contract with language that says 20% for co-shares. That way, you’re not taking anything away from existing retirees or potential retirees. Let’s start anew, starting with new hires, so when they read the fine print when they're coming onboard to become a Cranston police officer, it’s a 20% co-share with no cap, 10% co-share towards your healthcare when you retire. Right now, the taxpayer pays 100% of the health care costs for firemen and police. We need to start establishing new rules going forward, because of the economic times that we’re in. The taxpayers can’t afford these types of benefits out of their pockets anymore.
We’re cutting services. We’re losing employees and it’s because of fundamental changes that need to happen. I want my kids to be able to live in the City of Cranston in the future. We need to start making these changes. There’s no reason why we can’t start negotiating these contracts for the future, for future employees, for future hires. These 10 vacancies that we have to carry, if we have to hire them, let’s hire them under new terms. How else are we going to start working down longevity? How are we going to start working all these things down that the taxpayer can’t afford anymore?
Those are the structural issues that I thought the Mayor had an opportunity to bring to the table. Even if the sky’s falling down in the City of Cranston, we still need to try to bring those things to the table for the taxpayer, because they demand it. That’s the way I feel.
Funding Cranston
At last night's meeting of the Cranston City Council, Mayor Allan Fung offered his budget for fiscal year 2009-2010, and his plans for closing this year's large budget deficit.
Mayor Fung began by relating the budget situation in Cranston to the national and state situaion: "Cranston, like every municipality in the state, is living through an economic crisis unparalelled for our generation".
Turning the focus to more local matters, Mayor Fung outlined the recent history of Cranston's budget issues – union concessions budgeted for but not achieved, a $2.9 million dollar overrun in total expenses and unrealistic expectations for interest income, for starters. The result: a deficit for this fiscal year, from expenses too high plus revenues to low, of about $7.4 million.
The Mayor is proposing two sets of actions to get to the end of this fiscal year: 1) Layoffs over the next several weeks and 2) tapping the rainy day fund for this fiscal year.
The Mayor also provided an update of the status of police union negotiations and other union negotiations in Cranston, outlined his steps on dealing with two drivers of continuing deficits that don't always get the attention they deserve, pension payments and other debt payments, and offered an update on Cranston's never ending battle between the School Committee and the rest of city government.
The bottom line tax number for next year is a 5.46% increase in the City's total tax levy, which will require going beyond this year's tax cap figure of 4.75%. And in summation, "there's no one that's going to bail us out of this crisis ".
Finally, I'll make a special note of one short but important and very fiscally conservative statement made by Mayor Fung.
Soft Appeasement in the Service of Evil
As with the strained morality of modernism, what galls about rationalizations for the invitation of President Obama to be commencement speaker for and to receive an honorary degree from the Catholic Notre Dame University is the dishonesty of the rationalizations:
The Obama invitation, [Notre Dame President Rev. John] Jenkins emphasized, does not condone or endorse Obama's positions on stem cells or abortion but the visit is "a basis for further positive engagement."
As George Weigel subsequently points out in the linked article, "Commencement is not an occasion for debate." Obama will be receiving an honorary degree.
[Catholic law professor and Reagan lawyer Doug] Kmiec, who taught at Notre Dame for 20 years and supports the invitation to Obama, called it a sign of a mature university and further evidence that religion is firmly part of the public discourse.
This about a president who has pledged to disallow religiously founded morals from guiding public policy concerning science.
The invitation and subsequent justifications point to an intention to coo the masses to slumber because they don't comprehend the nuanced relationships between power and morality. And Father Jenkins's emphasis of Obama's race illustrates the soft racism whereby ethnicity trumps all, leaving the moral actor powerless in bonds of sensitivity.
Anchor Rising's Top 10 Right-of-Center Rhode Islanders: 10, 9, 8
Last week, we began a conversation about how one would gauge the top 10 conservative Rhode Islanders. To be sure, the conversation didn't stay on topic very long, but it did spark some discussion among the contributors. Once we defined criteria and a scoring system, we felt capable of providing a veneer of objectivity to our guesswork. Such rankings are inherently subjective and often based more on impressions than quantifiable metrics, but in an attempt at control, we rated each person on a ten point scale in each of the following three categories:
- Ability to affect the news cycle: In the ideological game, the message makes the messenger, so affecting the public discussion is a critical power. Some folks are go-to quotables for news stories; others can effectively create news from press releases; others can drive their opinions into the news even though their names never appear there.
- Native power of position: Since we're measuring "power" in a general sense, it's important to tease out different forms thereof. An influential media personality may reach thousands, but his or her ability to make decisions that change people's lives is indirect. Prominent executives top this category, with average legislators in the middle of the pack.
- Opportunity to influence others: It's one thing to provide quotes and stories to others (who may or may not report them accurately); it's another to have a personal audience or following. Conveyance of one's positions to other people and persuasion of them to act, or at least think, differently is the form of power generally called "influence."
Especially given the prominence of moderates in Rhode Island's right-of-center coalition, we thought it reasonable to work the person's degree of conservatism into the formula. Therefore, candidates could earn another six points — three on social issues and three on economic — with one point being at least moderation/ambivalence and three being a full fledged conservatism. Consequently, the highest possible score was 36.
We realize that opinions vary on what matters and how the criteria apply to each person on the list, and this being our first attempt at such an inquiry, we welcome comments or even corrections.
Starting off the top 10 is 630AM/99.7FM WPRO's evening host Matt Allen. Yes, he's the new host on the schedule; yes, he's on late. But Matt's got the top show on the radio waves during his slot, and we run into his listeners often. His power derives almost entirely from his microphone and his ability to make a thing news simply by discussing it. On the ideological scorecard, his libertarian streak softens his social conservatism, but Matt's well within the inner chambers of right's big tent.
Nobody would deny that the leader of a such a tiny band as the state House GOP is far from the top of the political hill, but certain powers and privileges accrue to the role. (Right?) More importantly, where there is discussion of budgetary matters, Mr. Watson is very often the agitated "opposing voice." When corruption and procedural leftism rear their heads in the General Assembly, he often leads the attack from the right (albeit, sometimes requiring prompting from folks farther up our list)... for what it's worth. Although, from what we hear, it's best that the leader remain mum on social issues, he's definitely a man of the right by Rhode Island standards.
You've heard the significance of having all the right enemies? Well, WPRO's morning host John DePetro drives those enemies crazy. We're not entirely sure why that is — assuming it's not the quick-take style of his show — but the size of his audience and local familiarity with his name (having snagged the "independent man" brand) are enough to land him on our list. He also carries the native Rhode Islander's advantage of having personal connections throughout the state.
ADDENDUM:
To make the title of the list more accurate, we've changed it from Top 10 Conservative Rhode Islanders to Top 10 Right-of-Center Rhode Islanders. Sometimes a shift in emphasis emerges between concept and publication without the resulting changes' being as thorough as they should be; such was the case here.
March 30, 2009
A Special Town Council Meeting
Interested in the process of the town's postponing the financial town meeting, I made room in my schedule to attend a special meeting of the town council at which we'll find out whether the town solicitor believes the town can legally seek to move the meeting to September.
Immediately upon opening the meeting the council voted to move the executive session that had been scheduled as a sort of intermission between the special meeting and a "workshop" to the beginning of the meeting. Solicitor Teitz had estimated the length of the executive session at seven minutes; I'm pretty sure that we're now over twenty.
7:27 p.m.
They're back, reviewing a handout from Teitz, with no copies for the audience.
Teitz: "I do think that it would be possible for the General Assembly to change the date for all the towns in the state." Broad, sweeping crisis stuff. He spoke to somebody who spoke with somebody who spoke with somebody, and that does not appear likely.
"There's nothing stopping the FTM, itself, from continuing it... however, you'd still have to have a budget prepared for them, and there's really no way of knowing what would happen."
"My philosophy is always to accomplish the goals of the client... So, I will tell you that it is my opinion that it is not constitutional for the General Assembly to change the date of Tiverton's financial town meeting alone."
7:32 p.m.
Teitz: "We're asking to unilaterally amend our charter without going through the charter amendment process."
"The only way that I see to do it is if you had an elect --- put the question to the voters of the town."
The special election would be "practical," "difficult," but "doable."
The authority to postpone the meeting is "only with the people." The special election might still require a special bill at the General Assembly, as well.
7:36 p.m.
Louise Durfee: "I think it would be easier to have the financial town meeting."
Teitz: "You are able to call a special town meeting afterwards." So, if budget considerations change, the council has the authority to call a meeting to change the budget.
Jay Lambert: "This General Assembly is not going to address the real issues, and we will have no more information in July, August, and September."
Broad agreement that the General Assembly sucks.
7:47 p.m.
Don Bollin: "I think we're better off going into that financial town meeting with the understanding that we're not getting that aid."
They've now adjourned the special meeting and entered into a scheduled workshop about the council's goals, etc.
8:11 p.m.
They're talking budgets and revaluations of properties in town. Town Administrator Jim Goncalo just said that the last he looked, the revals were running, overall, 15-18% lower than last year.
High Budget Noon in Cranston
That's it?!! The meeting just adjourned. Apparently the hearing with public input is not until Thursday.
Mayor Fung will ask for a 5.46% increase in the tax levy, requiring some kind of bypass of the state tax cap, possible because of the probable cut in state aid.
Greetings from the City of Cranston. where Mayor Allan Fung's is presently delivering his FY10 budget address in front of the City Council and several hundred people in the auditorium. I'll let you know if anything exciting happens...
House Republicans' "Form Letter"
... as promised. House Republicans have suggested that representatives who vote in favor of the General Assembly's pending supplemental budget send the following letter to the city or town which they represent.
(A press release is public, right? Okay, then.)
April 1, 2009Dear Town Council President /Mayor;
I wanted to drop you a quick note to let you know that today I will be voting in favor of the Democratic version of House Bill H-5019: An Act Making Revised Appropriations For the Fiscal Year Ending June 30, 2009.
Among other things, the Speaker’s budget bill cuts off all money for our city/town, reduces aid for our schools, includes tax increases that will devastate local businesses, make those few remaining citizens who have jobs pay more for gas and includes absolutely none of the management rights you have repeatedly asked for from the General Assembly.
The bill also puts off any relief you seek from pension reform and we even get to skip our required contribution to the state pension system. Too bad you can’t skip your payments as well!
Being an effective legislator is not easy, but it’s important for you to know, that no matter how bad this bill is for our city / town, Speaker Murphy wants me to vote for it. I always do what the Speaker asks, that’s how I am able to get my legislative grants (your tax dollars) that help me get my picture in the local paper. I have also been promised that one or more of the bills that I have introduced, which have nothing to do with actually helping our citizens, will be passed out of committee and voted into law – more publicity for me. Now that’s what I call a great trade!
One positive is that I do have permission to vote against some of the specific articles in the Democratic budget to make it look like I am on your side, but when it comes to the vote on the Speaker’s budget as a whole, Speaker Murphy needs my vote to pass it, and I always do what I am told.
The good news is that you can always raise property taxes to cover the shortfall or maybe layoff some more teachers, firefighters or municipal employees.
Well, I have to go now, we are celebrating National Peach Week and the Speaker has set up some delicious peach cobbler and peach wine for us in the House lounge.
Have a great day!
Your State Democratic Representative.
House Republicans React to the G.A. Supplemental Budget
... in a Press Release of today.
House Minority Leader Robert A. Watson (R-Dist.30 East Greenwich, West Greenwich) and the members of the House Minority Caucus today said that tax increases and the failure to provide our cities and towns management rights advocated by Governor Carcieri are unacceptable.“House Republicans have drawn a line in the sand and want to be clear, all tax and fee increases are unacceptable and must come out,” says Watson, “furthermore, the management and funding proposals contained in the Governor's initial budget must be restored."
"Absent such changes, we urge our house colleagues to reject this budget and we would urge the Governor to veto it should it reach his desk, as is," Watson said.
House Minority Whip John Loughlin (R-Dist. 71 Tiverton, Portsmouth, Little Compton) also called into question the way in which major elements of the budget, such as the gasoline tax, were inserted without pubic hearings or legislative input. "I can not understand how anyone could vote for a budget that is so detrimental to our local communities without having any meaningful input on the decision making process." Loughlin said.
“Mayors and Town Managers will not be pleased when they get their budgets cut and lose any hope of making local decisions to save money,” said Loughlin
"In order to help our House colleagues who want to vote for the supplemental budget, we have prepared a form letter * they can send to the communities they represent," he said.
Indeed, for cities and towns, the General Assembly's budget is the worst of all worlds: "they get their budgets cut and lose any hope of making local decisions to save money".
* Republican's suggested form letter to follow shortly.
What's Rhode Island's Corruption Tax
Unfortunately, the "corruption tax," as described here, is not a tax on corruption, but a tax to support corruption:
As taxpayers look down the barrel of a major income tax increase, another tax already is draining their wallets. But this one isn’t found anywhere in the tax code.It's the "corruption tax" — the extra money Illinois residents pay because of dishonest public officials.
People pay the tax when politicians give government jobs to unqualified cronies and contracts to expense-padding donors. They pay when public employees take bribes to overlook violations, when law enforcement spends millions prosecuting crooked politicians and when people are injured because of government misconduct.
"It means hundreds of millions of dollars lost in waste," said Dick Simpson, a former Chicago alderman and head of political science at the University of Illinois in Chicago.
I suppose the question is where one draws the line. The ratcheting up of public-sector pensions (and the failure every year to address the problem that they present) and benefits for union organizers are among the costs that I would include. Without having conducted any sort of study, I'd suggest that eliminating Rhode Island's corruption tax would close its annual deficit and then some.
via David Freddoso)
The Pressure to Give and Give
There's something very Rhode Island about a financial town meeting that admits non-resident outside guests and then adds half a million dollars to the school budget:
The non-resident ban the Lincoln Town Council approved 4-1 last week stems in part from controversy over last May's rollicking Town Meeting that increased this year's school budget by $517,248. In the aftermath, the meeting moderator questioned whether non-residents had voted for the increase and intimidated voters from opposing it. But the Budget Board reluctantly certified the budget on legal advice.Councilman Keith Macksoud, who said he brought the proposal to the council after talking with the Budget Board and moderator, said in an interview that some people indicated they felt intimidated to vote when teachers turned out at the meeting to support adding to the budget.
The ordinance says meeting attendees can vote by majority to allow the media, non-resident town officials/department heads, the town solicitor and "others" to attend.
I can see time's being an issue if every vote must be balloted, but it would seem feasible to have secret votes on substantive matters such as the school budget.
Our Best Minds Must Be in Government
Yeah, we could discuss the rights of a governing entity that is spending billions of dollars to prop up a specific company, but that would slide past the real question of political philosophy that makes this such a frightening proposition, no matter which step we highlight as the one in the wrong direction:
The Obama administration asked Rick Wagoner, the chairman and CEO of General Motors, to step down and he agreed, a White House official said.On Monday, President Barack Obama is to unveil his plans for the auto industry, including a response to a request for additional funds by GM and Chrysler. The plan is based on recommendations from the Presidential Task Force on the Auto Industry, headed by the Treasury Department.
It is nearly irrelevant whether Wagoner deserves to lose his job (the answer being pretty self evident, if you ask me). The critical first principle requires an explanation of why it can be supposed that a handful of brains on a Presidential Task Force can be expected to step into a gigantic, ailing industry and prescribe the appropriate steps to save it:
Industry sources had said the White House planned very tough medicine in Monday's announcement, which turned out to be an understatement. And it went to the very top. The measures to be imposed by the government will have a dramatic effect on workers, unions, suppliers, bondholders, shareholders, retirees and the communities where plants are located, the sources said.
One needn't have the IQ of a Task Forcer to predict one likely path should the industrial plans of an entity with the power to tax fall flat. One needn't be a community organizing short-term Senator and first-rate orator to see the incentives tilting in all the wrong directions. When the chief executive of a business is — in fact, if not on paper — the chief executive of the United States of America, the need to safeguard a résumé and reputation meets with unparalleled power to buy and coerce cover-ups.
March 29, 2009
The Left's Congenital Racism
Overwhelming obligations and only mild interest have limited the attention that I've paid to the JournoList controversy with which readers of the national conservative blogosphere will surely be familiar. Now that the discussion has transitioned into one of the semantics of racism, however, a brief comment is irresistible.
By way of background, New Republic publisher Marty Peretz is currently under fire for referring to the "congenital corruption" of Latin American countries. His detractors declare the phrase to be racist — imputing corruption to Latinos, I suppose. Having become entangled in the spat, Jonah Goldberg posted the following email earlier today:
The people who think that "congenital corruption" is racist are just showing their own ignorance of the meaning of the word. It has two meanings, 1)from birth, 2) essential nature. Describing Latin American countries as congenitally corrupt is absolutely accurate and has nothing to do with race. Corruption in those countries is systematic and endemic (essential nature) and that state has existed since those countries' independence (from birth). While many assume that a congenital birth defect means a genetic disorder, the term congenital includes both hereditary and environmentally caused disorders.Peretz' critics are dangerously close to "niggardly" territory.
As accurate as such semantic analysis may be, I don't think it quite captures the underlying error of thought, which ultimately exposes the congenital racism of liberals. In short, they believe race and ethnicity to be much more determinative than do conservatives. One cannot, in their view, declare the political tendencies of a region to be hopelessly and pervasively corrupt at their very core (i.e., congenital) without its being a statement of genetic qualities of the people who inhabit the region. One hears a similar ring in declarations that democracy will never work in the Middle East; it's not put forward as a statement of cultural habit, but of personal capacity.
It's this same racist impulse that raises cultural sensitivity to the status of a high ideal. An observation of foolishness in another's culture is cast as an attack on their innate intelligence, because they are assumed to be capable of intellectual disassociation from those practices. Standing firmly astride one's own culture (as with crucifixes in the classrooms of a Catholic university) is said to be an affront to non-sectarian students, because the uninitiated are presumed not to have the maturity to tolerate pluralism.
Gotta Take a Dollar to Give a Dollar
Tom Sgouros has penned another missive explaining why Rhode Island's fiscal conservatism has spelled its doom, and why more progressive spending and a bigger state government is the solution. I know. I know. Such are the indications that, though we all breathe the same air, we live in the different realities of our preconceptions.
One side's obvious conclusions are the other side's insidious illusions. My first reaction is to see in Tom's rhetoric and in his sources a deliberate deception founded in financial and ideological motivation. His sympathizers will see in my response a desperate attempt to spin away the incontrovertible at the behest of the puppet masters who control my financial well-being (and at whose suggestion I suffer through those staged photo shoots on construction sites).
I'll give Tom this: He bases his argument on a persuasive table, which Economy.com's Mark Zandi has gone so far as to present to Congress (PDF):
My understanding of this data — although specifics aren't easily available — is that it derives from a macroeconomic model into which Zandi plugged the various instances of government spending. If that's correct, then the exercise is fatally skewed based on the simple fact that the government must take a dollar in order to give a dollar.
Actually, the government must take more than a dollar in order to give a dollar. In 2004, for example, the Food Stamp Program spent about $0.20 for every dollar that it gave away (PDF). That's not the whole story, of course, because there were expenses associated with collecting, allocating, and processing the program's budget. According to Charity Navigator, 9 out of 10 charities spend no more than $0.54 per dollar given away on administrative costs, and 7 out of 10 spend no more than $0.33. For the sake of consideration, then, let's assume that it costs the federal government no more than another five cents per dollar handed out to get that money from the taxpayer to the Food Stamp Program, so the total cost per food stamp dollar would be $0.25.
That means that, for every food stamp dollar given, the government must take $1.25 out of the economy at some other point. According to Zandi, an across-the-board tax cut would add $1.03 to the next year's GDP, so it follows that taking a dollar costs $1.03. Based on an across-the-board increase in taxation, the cost of every food stamp dollar is therefore $1.29, making the actual amount that the whole process adds to the next year's GDP only $0.44. Inasmuch as it does not cost any money not to take a dollar from somebody, a broad tax cut would actually add $0.59 more to GDP than would the food stamp.
The intuitive sense, here, is that it doesn't make any difference, economically, whether I spend a cash dollar on groceries or a welfare recipient spends a food stamp dollar on the same items. If the government largess is extracted from everybody, then the working poor and middle class don't have those dollars to spend. In fact, it appears that funding food stamps by taking a dollar from a family that must therefore reduce its grocery bill in response winds up costing the GDP $0.43.
The appeal of Sgouros's argument comes in the fact that those who don't have to spend will tend to save; those who take in more than they could possibly spend will save even more. Indeed, looking at the numbers on the table, it's tempting to observe that a one-dollar increase in the corporate tax rate would appear to cost the GDP only $0.30, so reprocessing that dollar into food stamps would provide a net GDP gain of $1.43. That possibility is an illusion for two reasons. The first is that the $0.70 difference must come from some theoretical savings account (or untapped credit); thought through in reverse, the reason a dollar of corporate tax cuts only results in a GDP gain of $0.30 is that the rest goes somewhere unproductive. If that tax rate becomes confiscatory in order to alleviate the tax burden on the poor and middle class, corporations and the proverbial rich will not for long watch their reserves being depleted without reacting.
The second reason is that, when heavily taxing the rich, a marker of single dollars no longer applies. Wealthy entities (whether families or organizations) work in different amounts than do the the rest of us. It's true that a rich man may be less productive with a free dollar than would a poor man, but take from him ten million dollars, and he won't invest in a company, donate to charity, build a house, and so on, and those activities all filter down to folks who'll spend their money in the same fashion as welfare recipients, but without the government processing fee. If a few percent of the society is going to pay most of the cost of government, the taxation dollar amounts are exponential.
To be sure, Sgouros whistles an enticing tune when he writes:
People routinely misunderstand the important points of policy that stem from Keynes's findings. Government spending and progressive taxation aren't good things because they support government workers or "punish" rich people. They are good things because they are how a government can help the economy grow. (Up to a point, of course, a detail Keynes made clear.) Government workers with money to spend will spend it, and that drives the economy. Progressive taxation keeps more money in the hands of the poor and people in the middle, both of whom are more likely to spend their income than rich people are.
But he loses the thread of his earlier wisdom. Private-sector workers funded via mutual agreement will also spend their money, but they have more reason to earn it efficiently than public-sector workers funded via compulsory taxation. They also can't hide their wealth as thoroughly. Tom notes that a "dollar saved is not a dollar invested" and that "people have different preferences for how they hold their money," but he doesn't acknowledge that unionized government workers save their money in the form of perks, accumulating benefits, and defined-benefit pensions. There must be some form of savings — actual or theoretical against future taxation and revenue — in order for somebody in his '40s or '50s to retire for the rest of his life. A person who lives for thirty years on an annual pension of $35,000 had stored away over a million dollars in some nook of the system.
For its larger projects and continued growth, a society needs people with financial reserves, but those reserves have to be accessible for spending. A society also needs people motivated to create, and capable of creating, wealth, and those (as I've argued here, here, and here) are the families that Rhode Island has been chasing out. Sgouros and Co. can flash all the statistical pictures they want, but what Rhode Island must do is to maintain the number of wealthy taxpayers while relieving the burden of (and thereby attracting) the productive class.
Ultimately, that leaves only one broad category to which to turn to balance the state's budget: Those who represent a net cost to the government.
Gio Cicione: We will change our brand by returning to our ideals
[Below are excerpts from Gio's remarks at the RIGOP Convention March 19. Full text available in Microsoft Word.]
Thank you all for the opportunity to serve you again as Rhode Island Republican Party chair.
* * *
It takes a Carter to get a Reagan. 1976 was four short years leading up to the greatest Republican Revolution – and the most successful Conservative leader - in a generation – 1980.
And there is no doubt in my mind that we will get there. We have all the tools we need. We are unified. We are strong. We are committed to the cause.
More than that, I believe firmly that the political tides are already turning.
With the election of Michael Steele the leadership at the Republican National Committee has changed in a way that will allow us to speak directly to a broader range of voters – and note that I said ‘speak to’, not ‘pander to’. In other words, we will convert our message and modify our language to appeal to more voters as Republicans, but we will not try to win votes by trying to change into Democrats. Pandering is a proven strategy for failure. I really believe that this is the most important issue we face as a party. We have all had many discussions about how to position ourselves to the voters. Are we kooky right wing wackos? Are we RINO’s? How big is a big tent exactly?
I am here to tell you that this debate is over. The Democrats and the media love to talk about Republican divisiveness. The more time we spend with that sort of infighting, the less time we spend beating Democrats. It makes for a good story in the projo, but it makes for an ineffective political party. I need all of you to commit tonight to leave the infighting to the Democrats. Let Frank Caprio run as a conservative and Liz Roberts run as a socialist, and we’ll see where they land. We will run as Republicans. We are for small government and individual liberty. We want the state out of our business, and we will do more for our fellow citizens by putting that philosophy into play. We will win elections by presenting a constant and bold agenda. If that means we need to take a friendly jab at those Republicans that stray from our small government philosophy, then so be it. But we must deal with party discipline issues with respect and with the goal of bringing those folks closer through persuasion and the power of our beliefs; not driving them out because we fear diverse opinions.
At the same time as we are pulling together, the tide is dramatically changing for the Dems. According to pollsters Schoen and Rasmussen, Obama's approval rating is below where President George W. Bush was in an analogous period in 2001 and still heading down. Yes, that George W. Bush. Some honeymoon. I guess those Obama voters really were expecting cash to be dropped out of helicopters after he won.
So without the helicopter money, the democrat Congress is left trying to fight the political battle the democrats know nothing about – the economy. They are failing. They are failing miserably.
Do I want Obama to fail? Absolutely. If he succeeds in what he is attempting to do – what he and Rahm Emmanuel and Nancy Pelosi and Harry Reid are trying to do – then we will all suffer the consequences. It will be Carter times 10.
He must fail, and we must succeed, because he wants to socialize the economy – to put bureaucrats in change of Wall Street. We must stand up for freedom.
He must fail and we must succeed, because he wants to force doctors and pharmacists to support abortion against their will, and we believe in rights of conscience.
He must fail and we must succeed, because he believes – or perhaps he just hopes – that a man in an oval office in a white house in Washington DC can micro-manage a nation of 300 million free individuals, and we know that he cannot.
So what do we do? How do we engage the enemy, fight the battle? How do we do our part here, in our great state of Rhode Island? How do we support the Governor in his ongoing struggle to bring this state back from the brink of the abyss?
First, we recognize that which makes us republicans. We are not the Moderate Party. We are not Greens or Cool Moose. We are not the Conservative Party. We are the un-hyphenated Republican Party.
We stand for basic principles of individual freedom, the power of free markets, and the rule of law. I don’t think there is anyone in this room who can’t embrace that basic philosophy (well, maybe the reporters.)
Of course, we do not all agree on every issue, and that’s ok. We believe in the power of our ideas, and welcome debate because we know we hold the high ground. In our hearts, we know we are right.
* * *
In the end, this upcoming election will be the step towards a new Republican majority. We will gain seats, we will gain power, and we will keep the governors office in hands that will continue the stewardship and ideals of governor Carcieri and our Republican leaders.
We will change our brand by returning to our ideals. At the same time we will offer solutions and not just criticisms. We will outline a path for job creation, economic growth, effective and efficient government services, and diligent, fair, and just enforcement of laws.
We will take pride in our independence, but speak with one unified voice when delivering our message of hope and prosperity for all.
We will speak to every Rhode Islander and ask for every vote by adapting our message to those who are not used to hearing it and bringing it to the people instead of waiting for them to come our way.
We will succeed because we must succeed. Because the future of our great state demands that we succeed. Because our solutions are the only solutions that will relieve the suffering, lift the pallor of despair, and restore hope - we will succeed.
Gio Cicione begins his second term as Chairman of the Rhode Island Republican Party.
Chris Dodd Picks Up an Opponent
It's much too early for such polling to be accurate. So let's disregard the one point lead that Rob Simmons already has on Senator Chris "Sweetheart Mortgage" Dodd - plus we may jinx Mr. Simmon's chances - and focus instead on his positions.
From today's Westerly Sun.
If he were in the Senate now, he said he would have voted against the stimulus bill, calling it a throwback to the 1930s. A better plan would be to return to the 1960s or 1980s, he explained, when presidents John F. Kennedy and Ronald Reagan helped stimulate the economy by cutting business taxes.* * *
His other suggestion for stabilizing the economy was a three-month tax holiday, which would cost much less than the stimulus bill and give taxpayers more money to shop and spread their money around.
He also disapproved of the bank bailouts, he said, as well as the legislators who gave money away without oversight and then complained afterward about how it was used.
Damn. Does he have a twin in Rhode Island?
By the way, the incumbent did finally "coming clean" on one of his scandals ... um, by playing a game of peek-a-boo with it. From the Wall Street Journal of February 3.
Connecticut Senator Chris Dodd has finally, sort of, kind of, ended 193 days of stonewalling about his sweetheart loans from former Countrywide CEO Angelo Mozilo. At least he did if you were a fast reader and were one of the few reporters he invited to his Hartford office yesterday to review -- but not copy or take -- more than 100 pages of documents related to his 2003 mortgage financings through Countrywide's "Friends of Angelo" program.These are the files that Mr. Dodd pledged to make public after the news broke last summer that the Chairman of the Senate Banking Committee had received preferential treatment from Countrywide. At first, Mr. Dodd denied everything. Later, he conceded that he'd been given special treatment but thought it was "more of a courtesy."
Whew. Glad that's cleared up.
March 28, 2009
Newsmakers in the Morning
As Ian Donnis points out in his new WRNI blogging home, tomorrow's Newsmakers show (5:30 a.m. on 12, 10 a.m. on 11) features Travis Rowley and Meghan Grady — he a Young Republican, she a Young Democrat — and Republican Representative John Loughlin. Word is that reference is made to Anchor Rising.
Yes, Justin Katz Is a Real Carpenter
While we're keeping things light, it would seem a good time to mention something of the sort that normally ought to be ignored, but which, in this case, is so absurdly humorous that I can't resist response. While indulging curiosity related to my recent registration with the state as a carpentry contractor, I happened upon this:
One night while Mr. Katz was tapping away on his laptop I asked him, " What do you do for living"? Mr. Katz responds, " I'm a carpenter ". I thought, that's odd his hands seemed Jergen smooth for a trades guy. Does he swing a hammer and blog at the same time ? Does the saw dust srew up his lap top ? Does he have a special carrying case for those jaunts up the ladder ? Does the scent of carpenters glue cloud his thoughts as he blogs ? Does his boss allow blog time during the work day ?
The author, not surprisingly, is the same fellow who expressed pro-union sentiments in the Tiverton High School men's room, called me a loser at the infamous East Providence School Committee meeting, attempted to derail the Q&A session at a recent Ed Achorn talk, and made nicey-nice at the Ocean State Follies.
With regard to the texture of my hands, I can only opine that Louis either has deficient powers of observation or is relying on the fact that most people who might come across his post have no basis for disputing his characterization. This is not to deny that I regularly use moisturizer, but I'm afraid that my skin is damaged beyond repair and that the cuts and scrapes from wood, metal, and masonry heal at their own pace regardless.
As for proof, well, when we workin' folks take out cameras on the jobsite, pictures of ourselves are of very low priority. However, I do have one photo in which the architect captured me doing my carpenter/foreman/project manager thing last spring:
Here's the (almost) finished room last summer, for those who are curious, and yes, those are my tools in the foreground:
To answer the unionist's questions, though, we get a fifteen minute break in the morning and an unpaid half-hour lunch. For most of the last year, I've been using that time for blog-related activities — with enhanced efficiency, of late, owing to the mini laptop and cellular Internet service that your donations enabled. The rest of the day, politics is relegated to my mind, but only when the task at hand requires little thought.
Observing Earth Hour - Global Warming Climate Change Style
Tonight from 8:30 - 9:30 local time has been designated as Earth Hour.
THIS SATURDAY 28 MARCH AT 8.30PM YOU CAN VOTE EARTH BY SWITCHING OFF YOUR LIGHTS FOR ONE HOUR - EARTH HOUR.
I myself will participate in Earth Hour but in the manner of AGW advocates. By this philosophy, one is permitted to freely substitute crucial elements of a concept ("climate change" for "global warming", for example) and still assert in all solemnity that the concept has remained intact.
Accordingly, Earth Hour will take place in my house tonight from 1:30 am - 2:30 am. (Sorry, the night light has to stay on.)
Music Literacy on a Saturday
I'll see Peter Robinson's Gene Krupa "Sing, Sing, Sing" and raise him one Duke Ellington "Cotton Tail," although I prefer the faster-tempo version of the latter that Ellington recorded with Louis Armstrong.
Speaking of Armstrong, Robinson posted an email from a reader who cited a duet of his with Danny Kaye ("When the Saints Go Marching In," I believe) with reference to the literacy that the pair exhibited. One would be hard pressed, I believe, to argue that we haven't dumbed down the popular culture in the decades since those two entertainment giants roamed the Earth. Isolated instances have persisted, of course; Billy Joel's "We Didn't Start the Fire" comes to mind.
I'm sure there are more recent examples, but my drift toward fogeyism leaves me unable to cite them.
Filling Budget Holes by Digging Our Grave
The Democrats on the House Finance Committee should be remembered for their role in driving the state of Rhode Island farther into the ground. The Projo summary reads like a natural parody:
Gas tax:
Increase by 2 cents per gallon, to 33 centsCigarette tax:
Increase by $1, to $3.46 per packMunicipal aid:
Cut by $55 millionEducation aid:
Cut by $9.1 millionState employee pension plan:
Unchanged
Priceless.
Perhaps outshining the committee, though he's not on it, is House Majority Leader Gordon Fox, on the strength of this pathetic statement — which adjective I don't use lightly:
Asked if the midyear cut was fair, House Majority Leader Gordon D. Fox said, "Nothing in this situation is fair to anybody. But somehow we found ourselves here globally. So everything's unfair. I can't even use that term anymore. What's fair to anybody because the whole world is upside down?"
This is a man entrusted to make decisions for our state? In one paragraph, he brushes off economic factors and political problems unique to Rhode Island and makes a dim-witted case for arbitrary decision making. Granted, the question was silly, but the answer is that fairness must be judged from a broader perspective in times of crisis. What's fair is what gets the state out of its predicament, and raising taxes and fees while pushing the responsibility for deeper tax increases down to the municipalities (by not giving them statutory relief from mandates and requirements) will fail utterly at that mission.
As they flap about in their cluelessness, these committee members and like-mindless allies reveal quite clearly their intention to bumble from one year to the next, with the foresight of hamsters in plastic balls repeatedly bouncing off a sliding glass door. Committee Chairman Steven Costantino puts forward the inane assessment that "we're doing the same thing [as the governor], but we're doing it differently"; the governor should swear on the soul of Roger Williams that he will veto any attempts to squeeze yet another year of decision-free vapidity out of Rhode Island's ongoing calamity
March 27, 2009
Right on the Bailout Nation
Already talking about his next run against Rep. Jim Langevin, Mark Zaccaria is pitch perfect on the AIG mess, as far as I'm concerned:
"I don't anticipate that all of the stimulus money will be effectively used,'' he said. Zaccaria said he is not opposed in principle to such federal pump-priming measures to invigorate an ailing economy. But the law that Congress passed was so flawed that it should have been scrapped, he said.Zaccaria also found fault with the federal bailout of the insurance giant AIG. "My inclination,'' Zaccaria said of AIG, would have been ``to let it fail.'' As a business-oriented Republican, he explained, "I'm not entirely opposed to sitting back and watching the forces of nature and the economy take their course'' when businesses make mistakes that endanger them.
A Consistent Stand from the Right Perspective
W. Edward Massey reminds us that conservative free-marketism doesn't really dictate was can or cannot be put into a contract by one of the parties creating it — salary caps are a perfectly legitimate item for negotiation — as long as the agreement is mutually agreeable and considered binding. The possibility of changing the rules midstream is among the reasons that certain tendencies in government make it a treacherous partner:
It is possible to set rules for reasonable compensation of executives. It should matter little whether the money source is the government or the shareholder. What matters is that men with good judgment and better character come together to agree on what is reasonable. It can be done when the money is private, if there are truly interested parties involved.It cannot be done when the senator who heads the Banking Committee asserts that exemption of contractual bonuses in his bill had actually been inserted at the insistence of the Treasury Department. There is the second rub: Politicians are rarely reasonable because power is a non-economic force that interferes. When the money is public, we are left with nothing but the forlorn hope that men with good judgment and better character are involved.
Except inasmuch as is necessary for its own operation, government should remain — at most — an arbiter of market exchanges, not a participant.
A Slightly Longer History of Police Budgets in Cranston
Two substantive objections offered in the comments section to my short history of the Cranston Police Department budget were…
- The figures for the Napolitano years include some million-dollar-plus temporary "rent" costs associated with the construction of a new police station, and
- Napolitano's first police budget was the 3rd year of a contract negotiated by his predecessor (that would be Steve Laffey, for those not paying attention), and therefore can't be held against him.
| FY2005 | Laffey II | $17,709,556 | -- |
| FY2006 | Laffey III | $16,616,502 | ($1,093,054) |
| FY2007 | Laffey IV | $17,447,623 | $831,121 |
| FY2008 | Napolitano I | $18,677,744 | $1,230,151 |
| FY2009 | Napolitano II | $19,424,221 | $746,447 |
In FY09 (the "year" that started July 1, 2008), the evil Laffey contract had expired. If the Democratic Mayor/Democratic Council believed that the City had been snookered into a backloaded contract, their hands were free to make the corrections and "fundamental changes" they thought were necessary to get department spending down to levels they thought reasonable. It certainly appears that that's what Mayor Laffey did in the first year of the contract that his administration negotiated, where the amount spent decreased by over 1 million dollars from the previous year.
But the only major adjustment that Mayor Napolitano and the Democratic City Council called for in the FY09 budget was a pay freeze. Mayor Fung has gotten the police union to agree to a pay freeze, plus only a small raise for next fiscal year -- but now the Council and other contract opponents are saying that the pay freeze doesn't really count as savings. That doesn't strike me as wholly consistent. I'd appreciate it if the next commenter who says that "this contract is a giveaway" would explain how an 18 month pay freeze, followed by a small increase after that, plus the increased health care co-shares, all with no retroactivity, is a "giveaway".
If the Democrats on the City Council think that more drastic measures, like layoffs or pay cuts have become necessary, they should inform the public and the Mayor of this. They might also consider providing an explanation of why their eleventh-hour call for "fundamental change" should be seen as anything more than political posturing, when the Democratic Mayor/Democratic Council certainly didn't act during calendar year 2008 as if changing contract terms scheduled to take effect in July of 2008 was a significant priority.
I don't think the Cranston City Council has any better idea of what "fundamental change" is this year than they did last year, when they saw no need to act on the police contract. Maybe the Council's actions are being driven by something that changed between last calendar year and this one; I wonder what that could be?
March 26, 2009
A Not-So-Idle Question
Pondering something not at all self-referential, I got to wondering who might rank on a top 10 list of conservative Rhode Islanders. (Given the competition, let's define "conservative" as "right-of-center.") Some names and placements are obvious, but what would the breakdown be?
I suppose one would first have to settle on criteria. There are folks who, by the nature of their positions, have a certain amount of power. Others have influence of which the public is hardly aware. Still others are very visible, but their influence beyond their visibility is a question. How does one measure a legislator against a radio personality? A newspaper editor against an activist?
What do you think?
One Half of the Correction
Now events in France are beginning to look a bit more like a logical social correction:
French workers burned tires, marched on the presidential palace and held a manager of U.S. manufacturer 3M hostage Wednesday as anger mounted over job cuts and executive bonuses.Rising public outrage at employers on both sides of the Atlantic has been triggered by executives cashing in bonus checks even as their companies were kept afloat with billions of euros (dollars) in taxpayers' money and unemployment soars.
The hostage taking borders on the extreme (not crossing over, I should note, because it appears more a symbolic inconvenience than an actual threat), but this is how societies correct themselves when they get too far out of whack. Of course, the longer the correction remains unheeded, the more extreme the measures become. Taking an eye-popping bonus is still a long way from throwing a father a coin after you've trampled his son with your horse-drawn carriage, and in part because of technology, I don't think we'll get to the point of the French Revolution again.
Still, we should take a lesson from history and resist the urge to codify the social reaction within the government, as the pendulum will merely continue to swing. Rather, we should back off a bit and permit market corrections to do as they ought before emotions burst the market's boundaries. Let utter bankruptcy and shame be the correction for greedy corporate types, and leave the hostage taking to terrorists.
Our Image Among Extremists: Confusion About the Order of Events.
... reflected in this letter to the ProJo.
It was the Bush administration’s detention and torture policies that made us less safe and more reviled by the Muslim world. Former President Bush’s torture and detention policies certainly radicalized many individuals across the Muslim world, and President Obama’s executive orders are a first step to defusing that hatred and giving us an America we can be proud of again.
I'm going to take the liberty of assuming that in the first sentence, the author did not mean all Muslims but only that tiny percentage capable of acts of terror and violence.
The murder of 3,000 + innocent people in three locations strikes me as pretty radical. Certainly we can discuss the wisdom, adviseability, morality of some of the policies of former President Bush. There is no question, however, that these policies did not precede but followed the attacks on September 11, 2001.
A Short History of Police Budgets in Cranston
Here are the official budget numbers for the last several years of the operation of the Cranston Police department, plus a column showing the change from the previous year…
| FY2006 | Laffey III | $16,616,502 | -- |
| FY2007 | Laffey IV | $17,536,373 | $919,871 |
| FY2008 | Napolitano I | $19,919,454 | $2,383,081 |
| FY2009 | Napolitano II | $20,679,721 | $760,267 |
I had a chance for a brief interview with Cranston Mayor Allan Fung yesterday on the subject of the police contract and budget. I asked him about the $400,000 savings he is claiming that the contract he negotiated will save. Since the new contract will covers this fiscal year (FY2009), the $400,000 savings is a savings against the budgeted total. For the subsequent years, Mayor Fung's administration is applying zero-based budgeting analysis, calculating how much it should cost to run the department with a full complement of officers, then factoring in how concessions like the hiring freeze, the 18-month pay freeze, etc. will lower costs.
I asked if there were any concerns about overtime related to the positions left vacant by the hiring freeze, and if it could unexpectedly drive costs up. The Mayor answered that that overtime can be driven by different factors, but that the City has been watching its overtime expenditures, and is assuming they will stay reaonably stable. Finally, I asked about the City Council’s claim that this contract "requires" vacancies to be filled at the end of the term. Mayor Fung said that the rules regarding vacancies at the end of this contract will be no different than the rules in the previous contract.
Returning to the numbers themselves, the largest recent increase by far in the Cranston Police Department budget occurred in Mayor Michael Napolitano's first year, an increase of 2.3 million dollars over the previous year (N.B. see the addendum below for an explanation of this expense). Cranston City Councilmen John Lanni, Anthony Lupino, Terrence Livingston and Emilio Navarro were all on the City Council that approved the 2008 increase that significantly raised the "structural" baseline that they are now expressing concern about. If they had concerns about structural problems being created during the Napolitano administration, they never took a stand on the steps needed to correct them. What could have changed in Cranston, I wonder, to make the Councilmen discover their inner fiscal conservatives?
Unfortunately, this is Cranston as a microcosm of Rhode Island politics. Spend like crazy when it's all one, big happy (Democratic) party. Then blame someone else for not doing enough, when it comes time to correct the problems.
The logic of Democrats in Cranston has been that, without the contentiousness might arise from having a Republican administration deal with unions, they can negotiate deals that deliver qualiy services at reasonable costs. But compare the theory to what actually happened; look at the change in the police department budget in FY2008, under a Democratic Mayor/Democratic council, and look at what is happening now. The Dems here don't really seem to be able to deliver on either half of their promise -- they somehow manage to spend big and create turmoil at the same time.
If this City Council is going to kill this police contract, they need to be specific about the "fundamental changes" they want to see carried out. To borrow the description that Justin recently offered of the state's situation and apply it to the local level, standing around like frozen deer in the midst of a financial crisis isn't sufficient action. What exactly does the council want to see done, to mitigate the structural budget problems that took a mighty big leap under the all-Democratic watch of FY2008?
ADDENDUM:
Commenter Donald Botts makes a fair point explaining the big budget increase in Napolitano year I...
The reason for the huge jump during [Mayor Napolitano's] first term is a $1.2 mil jump in the rent line item. I would assume this can be attributed to the new police station.
Sex Ed Is About Indoctrination
Hooking young Americans on a particular view of sex has always been bound up with an entire slate of socio-political biases and cultural preferences. Ultimately, it's always about indoctrination:
When Rep. Lisa Baldelli-Hunt, D-Woonsocket, asked [Rep. Donna Walsh, D-Charlestown,] what she would consider age appropriate material for a kindergartner, Walsh deferred the question to Dr. Midge Sabatini, of the Department of Health, who said that instruction would include topics such as hygiene, the potential dangers of talking to strangers, family values, family roles and "cultural diversity."
Why do I suspect (for instance) that "family values" don't involve the assertion that sex should be reserved for marriage and that marriage is the merger of a man and a woman with a presumption of a procreative family? There is a concerted agenda behind this push deriving from a class of people who've been striving for decades to impose their worldview on everybody by the mechanisms of government.
That the push leads with sex reminds me of that scene in Pinocchio in which a man lures wayward boys to an island on the promise that they can do whatever they wish once there — the catch being, of course, that their behavior would turn them into salable donkeys.
Perhaps If the GA Became Obsessed with Twittering...
Matt Allen and I touched on twittering, sex ed, and economic development, last night on the Matt Allen show. If twittering is as addictive and time-consuming as some folks have suggested, then we might do well to get our state legislators hooked. Stream by clicking here, or download it.
Proposed Supplemental Budget: Raise Gas Tax, Postpone Pension Reform
A group of lawmakers (House and Senate Finance Committees? can't tell from this ProJo article - not that I'm complaining! I'm glad for any coverage) has agreed on a supplemental budget for the current fiscal year, which they will vote on tomorrow, presumably setting up a vote soon by the full House and Senate.
House budget-writers are poised to vote tomorrow on their own version of Governor Carcieri’s $357-million deficit-avoidance plan for this year, and if an agreement reached by House and Senate leaders earlier this week holds, it will add a 2-cent hike in the gasoline tax to the mix, while leaving pension cutting decisions to another day* * *
It appears the agreement also scraps Carcieri’s plan to restore millions of dollars in aid to cities and towns. On education, it calls for a complicated formula that uses federal stimulus funds to supplant about $38 million in state money. Ultimately, the only noticeable change to local school districts would be the proposed elimination of about $9 million in education aid ...
While we may not all agree with his suggestion for dealing with Rhode Island's public pension liability, most of us would probably like to associate ourselves with the comments of the honorable gentleman from Tiverton on the proposed gas tax hike.
Taking aim at the gas tax-hike, House Minority Whip John Loughlin, R-Tiverton, said: “The last thing we need to be doing in a situation where we have double-digit unemployment is increasing taxes of any kind, especially taxes that people who get up every day and go to work have to pay at the pump every day to commute to the few remaining jobs we have in the state.”
And what about badly needed reform to public pensions?
[Senate Finance Committee Chairman Daniel] DaPonte said there will be action on the “pension-reform” front before lawmakers go home this year, but there were so many questions about Carcieri’s savings assumptions that House and Senate leaders decided to hold off.“It is going to happen, but it’s only going to happen with real numbers after real in-depth study which we are in the process of doing now,” he said.
Yes, technically, actuarial consultants are still in the process of toting up the specific savings that would be realized if the recommendations (aggressive by Smith Hill standards; moderate by any other) of the Pension Commission appointed by Speaker Murphy are implemented. But we know how this book ends. Rhode Island faces one of the biggest unfunded pension liabilities in the country, a liability so great, as it stands now, it cannot be paid. Adjustments must be made. Doesn't every year that goes by without them make it that much harder to fix the problem? Wouldn't it be better to implement some adjustment, admittedly modest and inadequate, now and implement the final reform when the numbers come back?
March 25, 2009
Darkness Creeps In
This is an abomination and a blood-red stain on our entire society:
The pregnant woman showed up at the medical center in flip-flops and in tears, after walking there to save bus fare.Her boyfriend had lost his job, she told her doctor in Oakland, Calif., and now — fearing harder times for her family — she wanted to abort what would have been her fourth child.
"This was a desired pregnancy — she'd been getting prenatal care — but they re-evaluated expenses and decided not to continue," said Dr. Pratima Gupta. "When I was doing the options counseling, she interrupted me halfway through, crying, and said, `Dr. Gupta, I just walked here for an hour. I'm sure of my decision.'" ...
Planned Parenthood of Illinois clinics performed an all-time high number of abortions in January, many of them motivated by the women's economic worries, said CEO Steve Trombley, who declined to give exact numbers. Abortions at Planned Parenthood's St. Louis-area clinics were up nearly 7 percent in the second half of 2008 from a year earlier — ending a stretch in which the numbers were dwindling.
Planned Parenthood said it has no up-to-date national abortion figures, nor do other private or government agencies. However, Stephanie Poggi of the National Network of Abortion Funds, which helps women in need pay for abortions, said calls to the network's national helpline have nearly quadrupled from a year ago.
I daresay that a majority of the citizens of the United States could muster some outrage at an epidemic of perfectly healthy dogs' being put down because the owners who've raised them have decided that their existence is more than the household budget can bear, and yet here we have parents killing the offspring whom they purposely conceived.
Evil has gained a terrible sway in our society if we express no horror at the depths to which we've sunk.
Ultimately, a State Is Not a Business
Even though they occasionally express a worthy idea, articles such as this long Sunday front-pager convey the wrongheadedness that plagues this state:
Another of Carcieri's major, second-term priorities is building a "green" economy. The concept is sometimes vague, and like biotechnology, every state is chasing it. And yet, going green could be the key to rescuing Rhode Island's blue-collar laborers from the dying manufacturing industry.That can only happen, however, if Rhode Island focuses on its obvious advantages and develops training programs to prepare workers to build these industries. ...
Still, if it's not careful, Rhode Island can miss its window. Though there is a scarcity of wind power nationally, New Jersey and Delaware have dived into the mix and are poised to outpace Rhode Island if the Ocean State gets too distracted or settles for too slow a pace.
"You can't be good at everything," said Atkinson, the former economic-development head. "You've got to be somewhat specialized."
Put aside the union hand behind the "green" movement. States shouldn't operate as businesses when it comes to selecting industries and trying to compete with other states. We don't run on venture capital. We can't all declare bankruptcy, fold the state, and create an other one. We can't, in specific, invest in retraining people and recasting our regulations in order to attract a narrow industry only to find that another state beat us to the punch, or technology has obviated our intended product, or any of the various things that can change does change.
The article is about fostering, attracting, and keeping innovators, but the principle that is missing from the entire discussion is that innovators innovate. That's what they do. And we'll increase our likelihood of benefiting from their efforts if we eschew the advice of former Economic Development Corp. (and current think tanker) Robert Atkinson to specialize.
We need a generalized improvement of the methods by which innovators can work their magic.
Healthcare Controls Can Be Natural or Unnatural
In the abstract, there's a dollar amount at which our healthcare system would hum along, factoring in how much employees would demand to do their jobs, how much supplies and operations cost, the expectations and requirements of consumers, their willingess to conserve, and so on. The more we drift from that ideal, the more we'll hear this sort of news:
The study for the Robert Wood Johnson Foundation found that nearly 1 in 5 workers is uninsured, a statistically significant increase from fewer than 1 in 7 during the mid-1990s. The problem is cost. Total premiums for employer plans have risen six to eight times faster than wages, depending on whether individual or family coverage is picked, the study found. ...About 20.7 million workers were uninsured in the mid-1990s. A decade later, it was 26.9 million, an increase of about 6 million, the study found.
In the 1990s, there were eight states with 20 percent or more of the working age population uninsured. Now there are 14.
The article notes that workers ultimately fund the health insurance of the elderly, the young, and all of those who receive subsidized healthcare, and it doesn't take extensive consideration to understand that increasing costs make it less likely that employers will offer the benefit and increasing coshares lead fewer employees to accept it. The more the system removes natural incentives to conserve and price shop for select groups, the higher the price will go for the rest.
A fiat that mandates the removal of risks and benefit-cost-cutting will skew the system further. The excesses and waste will come out somewhere — probably in rationed services and reduced quality.
March 24, 2009
A Step Towards State-Run Media in the US?
This is a tad frightening...
With many U.S. newspapers struggling to survive, [Democratic Senator Benjamin Cardin] on Tuesday introduced a bill to help them by allowing newspaper companies to restructure as nonprofits with a variety of tax breaks...Cardin's Newspaper Revitalization Act would allow newspapers to operate as nonprofits for educational purposes under the U.S. tax code, giving them a similar status to public broadcasting companies.
Under this arrangement, newspapers would still be free to report on all issues, including political campaigns. But they would be prohibited from making political endorsements.
Two Tea Parties for the Ocean State
Further to the complaints pointed remarks of commenter TaxPayer and myself under Justin's post, the Ocean State Republican blog reports that, in fact,
There will be two Rhode Island “Tea Parties” on Tax Day, April 15th. The different times should allow anyone who wants to participate, to fit at least one of the parties into their schedule. The first will be in Providence from12:00 PM to 3:00 PM[new time] 3:00 PM TO 6:00 PM, and the second will be in Warwick, from 4:00 PM to 7:00 PM.The Providence Tax Day Tea Party will be on Wednesday, April 15, 2009 from 12:00 PM to 3:00 PM, which will be taking place at the Rhode Island State House on Smith Street.
* * *
The Warwick Tax Tea Day Party will take place at the corner of Airport Road and Post Road, outside of the Rhode Island Republican Party HQ from 4:00 PM to 7:00 PM.
President Obama's Press Conference
Listen live on WPRO. Comment here. (In case anyone else has been ranting at a radio or television for the last 27 minutes ...)
Non-Negotiating Season School Committee Meetings
The contrast is huge between these school committee meetings when there's no contract under negotiation versus when there is. An interested resident who came to tonight's meeting and took it as representatives would surely have trouble motivating him or her self to come to others. They're discussing the budget, but a viewer would have to know quite a bit of back story in order to discern the interesting points. (Frankly, I'm pretty well versed in the controversies, and I'm not finding much of note.)
7:53 p.m.
As at last night's town council meeting, the longest discussion comes with small-town stuff, in this case, over the names that will be included on the plaque that will commemorate the completion of the new school buildings. School committee member Sally Black suggested a second plaque to capture some language suggested by fellow member Carol Herrmann (thanking the citizens of Tiverton). Danielle Coulter asked the cost per ($1,500 each) and suggested that all changes be made to the one plaque.
8:27 p.m.
The committee has been discussing the possibility of pulling fifth graders from the middle school and putting them into the elementary schools. It's clear that Superintendent Bill Rearick opposes the move, and he presented the cost-benefit analysis as a dramatic cost to the district. Carol Herrmann asked Mr. Rearick for his rational for including new hires at the rate that he has (e.g., creating a 4/5 position), and his response was that the numbers were all discussed with the principals, but that he didn't have the supporting materials with him.
I'm not sure what is implied by the fact that the superintendent didn't bring all relevant material to a meeting at which the elected officials to whom he reports would be considering the issue, but it seems very unlikely to indicate something positive.
8:38 p.m.
During discussion of the stimulus money, Herrmann asked whether decreases in the town's budget for the schools would disqualify the town for stimulus funds. Rearick said that to be his understanding.
One wonders why spending millions of additional dollars on schools doesn't qualify as "maintenance of effort." It's also curious that government handouts somehow always require other levels of government to spend more money themselves.
It's almost like a conspiracy.
B. Frank: Invective Over Reason
Is he looking to create a distraction from all of the money he is costing us? Has he run out of substantive arguments on the issue itself?
"At some point, [the Defense of Marriage Act] is going to have to go to the United States Supreme Court," the congressman, a Democrat, said. "I wouldn't want it to go to the United States Supreme Court now because that homophobe Antonin Scalia has got too many votes on this current court."
I remain ambivalent enough on the issue of gay marriage to not have a dog in this fight. But I'm pretty sure of two things.
1.) Someone who opposes gay marriage is not axiomatically a homophobe, even if we expand the definition of "homophobe" beyond "a person who fears gays" to include "a person who dislikes gays". In fact, most people who oppose gay marriage are not homophobes.
2.) Childish name calling by an advocate isn't going to draw undecideds like me towards that side of the issue.
A Tea Party for the Ocean State
It's becoming a frequently asked question of me, when I'm going about my business, when Rhode Island will host its own tea party. Well, I just received word that Ocean State Policy Research Institute has put up a Web site to promote just such an event on April 15th (tax day) 12:00 to 3:00 p.m. at the State House:
On February 19th, 2009, Rick Santelli spoke out on the Chicago Mercantile Exchange during a CNBC broadcast and expressed the frustration we are all feeling. Spawned of that "rant" was the National Tax Day Tea Party - and when Colleen Conley emailed the national group and said, "Rhode Island should do something like that," she had no idea how many other people were thinking the same thing.Make your voice be heard on April 15th
Please join us as we send a message to our elected leaders that THEY WORK FOR US!
We the People are tired of irresponsible spending and actions taken by the state and federal government which threatens the financial health of the United States of America. We refuse to allow them to mortgage our children's and grandchildren's futures.
We demand accountability for their actions!
The End of the Labor Line
One can't help but see France as an example of the future several steps down a path toward which Rhode Island (and to some degree the United States) seems sometimes to threaten to take. This sentence captures the total absurdity of the mindset:
More than 1 million people marched in France yesterday to demand that the government do more to overcome the economic crisis, but planned strikes failed to fulfill a key goal - to paralyze the country.
Paralyzing the country to spur an overcoming of an economic crisis. Yeah, that'll work. I've an affection for the concept of revolution, but in practice, it often seems to be a manipulated excuse for citizens to enjoy a period of havoc.
Harriet Lloyd: News Not Fit to Print or Newsmakers Not Fit to Cover?
Amidst much wailing and gnashing of teeth, national and local newspapers bemoan dwindling readership and diminishing profits, with many closing their doors, unable to make ends meet. While the demise of the Fourth Estate is a shame, it is hardly a shocker. When a business consistently misdirects its marketing, it must expect to pay dire consequences. While most businesses would rapidly move to staunch financial bleeding by changing strategy, such appears not to be the case among Rhode Island's print and television media.
Here, newspapers are losing their fight for survival for a reason that is fairly simple to objective observers. Citizens seeking high-quality, unbiased information, as well as thorough coverage of important events, no longer expect to find it in Rhode Island's newspapers or network programming. Instead, our media is saturated with third-grade level, tabloid-type material, "lightweight" news often gleaned from syndicated sources. Replete with bald-faced political propaganda, inarticulate reporting and an abundance of advertising, Rhode Island's media have buckled under to political pressure and pandered to society's lowest denominator — and then have blamed their lack of popularity on the Internet.
While the Web is a force with which newspapers must now reckon, Americans still enjoy news in hard copy; many would maintain subscriptions merely for convenience if they found the contents worthy. Disgusted and hungry for real information, they are forced to turn to the Internet and radio for the "down and dirty." No matter what political stripe, age, race, or religious affiliation, people in increasing numbers are turning away from their newspapers, finding them less and less relevant and reliable. The trust is gone.
Take a recent example from Newport. Governor Carcieri, General Treasurer Frank Caprio, Department of Administration Director Gary Sasse, and Bill Murphy of the East Providence Taxpayers Association addressed a ballroom packed with taxpayers concerned about the state's financial crisis. With them were twenty state senators and representatives, as well as mayors of the state's major cities and towns. Sponsored by a non-partisan group, the Rhode Island Statewide Coalition, the free Saturday morning forum at the Newport Hyatt Regency was broadly advertised to the media; press releases were circulated repeatedly in the weeks prior to the event. News personnel would have had to be living under a granite boulder not to have been aware of it.
As a capacity crowd of over 250 Rhode Islanders embraced the opportunity to interact with their government leaders and to make their voices heard, not one newspaper reporter attended — not even those most local. For more than two hours, one could have heard a pin drop as Rhode Island leaders — Democrats, Independents and Republicans — spoke candidly about their concerns, frustrations and the steps being taken to address our most serious economic challenges. Among their concerns was incomplete and inaccurate reporting. Following their remarks, they entertained questions and comments from citizens in a rare, intimate discussion. Democracy was at its finest that morning, but no stories appeared in newspapers. Among the television news stations, only Channel 12 was present; all other television news programs were conspicuous by their absence. Indeed, the only place to find a full, accurate recording of the morning's events is on Web sites, as the event was streamed live and videotaped.
The irony was obvious to all in attendance: Rhode Island's media market was alive and well in the Hyatt ballroom that morning; where was the media? Present were citizens who were interested, informed, and educated about the crucial issues facing the state. These were the very people most likely to read newspapers, contribute letters and opinion columns, and tune in to high-quality news programming. They were the individuals most likely to influence and finance media consumption in Rhode Island. They were voters, business owners, the unemployed, college students, school board members, town councilors, young couples, and retirees. Once again, they were disregarded by their state and local news people.
Is it any wonder that online news sources, e-newsletters and radio programs are replacing newspapers? Sadly, traditional media simply doesn't get it: there exists a considerable market for literate, fair, and thorough journalism. Media leaders can whine about the Internet, but if they will not provide news of substance and quality, Rhode Islanders surely will find it elsewhere.
Harriet Lloyd is Vice President and Secretary of the Rhode Island Statewide Coalition.
Bumping in Education Is Obviously Wrong
Amanda Pereira, a sophomore at Classical High School, and her fellow students in Young Voices confirm that students also see what many of us believe to be obvious, that allowing teachers to be bumped from their jobs based on seniority alone is wrong:
[Bumping] has a terrible effect on students. In 2008, we conducted groundbreaking research on students' everyday experience in Providence schools. We surveyed more than 1,600 high-school students and conducted focus groups with more than 200. Many students talked in the focus groups about losing their best teachers to bumping. This comment is just one example: "I had this social-studies teacher who really cared. He was a great teacher and I could really relate to him. Then he got pushed out one day, and I got this teacher who just sat at her desk and didn't teach us anything."It's really hard to lose a great teacher, especially since there aren't a lot of teachers we can connect with. In our research, students said only 30 percent of their teachers motivate them.
Bumping is just an egregious example of the "union approach," which is clearly a detriment to our schools and a harm to our children.
March 23, 2009
Avoiding a Tax Increase by Increasing Taxes
While the town council discusses sewage-related matters, I've revisited a recent Sakonnet Times article and found the following more significant in light of my subsequent confusion about the sudden drop in the projected tax increase:
The council adopted a new schedule of fees and fines for over 150 services that will generate revenues for the town. Dog licenses, gun dealer permits, mooring fees, assessor inspection fees, and landfill fees are among the many listed in the new schedule.In addition, increases in almost all such fees were approved by the council. Cemetery plot fees went from $250 to $400. Insufficient check fees went from $25 to $50. Blocking a fire hydrant will get you fined $50, not $20 as it used to. Commit a handicapped parking violation and expect to be fined $75, not the previous $20.
In an interview, Town Administrator Goncalo said he had “no idea how much more” in additional revenue the new fees and fine amounts will generate for the town.
As with the other ordinances adopted by the council Monday night, the new revised fee and fine schedule will be posted on the town website in the near future, said Mr. Teitz.
I wonder whether some sort of estimate of new revenue in the revised budget submitted by the town council. If so, then we've avoided exceeding the tax cap by increasing taxes by another means.
Back in the Town Hall
Missing a town meeting or two reminds the active citizen how nice it is to have nights at home. Ah, well. If we're going to have a democracy...
When I walked in (yes, a few minutes late) RI Rep. John Loughlin (R., Tiverton, Little Compton, Portsmouth) was giving the council the newly regular update of happenings at the State House. Now, Wayne [somebody] is describing the state's stimulus-related activities. Councilor Louise Durfee asked whether the money-related decisions will be made by the General Assembly or ladled out after the session's end. Loughlin answered, "Yes." Both methods will play a role.
7:19 p.m.
Just an observation: Councilor Jay Lambert asked Loughlin about state aid (receiving no concrete answer), and jovial comments from Durfee thereafter gave the impression that something has changed in their relationship. Since the last meeting that I attended.
7:23 p.m.
On state aid and the financial town meeting, Durfee told Loughlin that the town is considering giving the legislature a bill for spending needs or demand a change in the financial town meeting's date.
TCC member Joe Souza just asked the town council to request that Loughlin introduce a bill to end binding arbitration for police and fire. Souza: "We've heard the town council complain that they have no control over the budget."
8:13 p.m.
Town Administrator Jim Goncalo informed the council that the governor has offered to reinstate some of the state financial aid to the town... but only if he can use stimulus money for the general fund.
This issue seemed to be raised mainly to offer another opportunity for councilors to mention postponing the financial town meeting.
8:34 p.m.
The town recreation committee is requesting permission to put up outfield banner ads for the Little League fields in order to fund capital projects. They're estimating that 20 banners will generate $20,000-$25,000 per year. The committee sees the practice as the norm.
Louise Durfee is objecting that allowing advertising puts the town on slippery slope as other leagues come forward for similar treatment. "We've kept our recreation areas free of commercialism." Council President Don Bollin is getting pretty fired up about the visibility of the signage.
Hey, here's an idea: Let's raise taxes! It's almost the same thing, only the people paying the money get no advertisements in return.
8:45 p.m.
Lambert suggested trying one field for a year. Councilor Ed Roderick is partial to the slippery slope argument.
9:00 p.m.
Durfee moved to reject the proposal. Lambert amended to make it a one-year, one-field experiment, but received no second. All but Lambert voted to reject the proposal to place green signs with yellow letters (lettering only visible within the field) in order to build a new concession stand that isn't rodent-infested.
Have I mentioned that the town recently approved raises for AFSCME employees? Maybe we should make them wear advertising buttons on their shirts.
If I had time, I'd prove a point by standing near the outfield fence with a handheld sign for one of the organizations with which I'm involved and see if the police come after me.
9:22 p.m.
Jay Lambert and Ed Roderick are about to move to postpone the financial town meeting to allow for more information to be available.
9:24 p.m.
Actually... Lambert's making the point that all estimates are for tax increases below the 3050 cap even with the state aid listed as zero dollars. Consequently, he's proposing to go ahead with FTM as scheduled, where town officials would lay out what will happen with any state money: half to the reserve fund and half to tax relief for the town. "A lot of people may not trust us on a continuance."
9:29 p.m.
Durfee wants to recess a meeting to "level the playing field." At the latter point, we'll have facts that we don't currently have, on which list she includes labor agreements. She argues that the low tax increase currently on the table provides for no increases for any employees. Regarding negotiations: "Changes we want in contracts, we may need to give a little to get it."
They (i.e., Durfee and her backers) just want to give more away to the unions than they should, and they don't want the citizens to feel that they have any say in the budget.
9:38 p.m.
The solicitor (not Teitz) is suggesting that the General Assembly may lack the authority to permit the town to change the date of the FTM.
Durfee interrupted to argue "that doesn't ring accurately with me."
9:41 p.m.
Councilor Cecil Leonard just noted another instance of numbers games in the low, low budget: Revenue projections that are dramatically higher than history, such as a jump in mooring fees from $3,500 to $45,000.
He's also arguing that postponing the FTM will result in unrest. He cited the 58% of people who rejected the proposal to let the town council decide the budget.
9:44 p.m.
Chris Cotta took his regular turn at the microphone to suggest that nobody's trying to fool the taxpayers; they're just trying to have accurate information for the taxpayers. I'd suggest that the only information that they want to feed the taxpayers is how much they have to pay for signed union contracts.
9:51 p.m.
Durfee moved to proceed in seeking legislation that would postpone the FTM until Saturday, September 12, pending a legal decision that it is legal to do so. Just curios: when do our seasonal retirees leave town?
If this passes, I think my summer may be devoted to campaigning to cut a double-digit percentage from the budget.
9:59 p.m.
The council voted to have a special meeting next Monday, at which time, the solicitor will have an opinion, and they'll take the vote on postponement then.
Here's a Thought for Mr. Caruolo: Democratic Dispute Resolution
The infamous former RI House Majority Leader George Caruolo, who acquired that adjective when he put his name on a bill that permitted school departments to file suit against their towns for more money, argues that his solution is better than the one that it replaced. Rather than sending funding disputes to the courts, as is now done, the law sent them to Dept. of Ed. bureaucrats.
In making his case, though, Caruolo presents an illustration of the manner in which a skewed first principle prevents the appropriate resolution of issues:
What I don't see are any serious suggestions of where these disputes should be decided. Back to the commissioner or to a governor's panel and we will see the old games again. While a fiscally conservative Republican governor might make decisions that Mr. Jones can agree with, what happens when a pro-union free spender takes office? There is room for abuse when the power to decide these questions is concentrated in any interested bureaucracy.
If I might hazard a suggestion: How about we permit voters to decide such matters by placing the taxing and spending authority with the same body? Either give the towns final say over school department budgets or give the school departments the power to set their own tax rates. If the schools are detrimentally underfunded, the people can elect representatives to increase the flow of money; if the schools become tax sponges, then the people can boot the folks with the budgetary mops.
Taking from AFSCME to Pay the Teamsters
AFSCME Council 94 President J. Michael Downey has an op-ed on yesterday's opinion pages in which he makes a couple of flawed analogies in trying to convey his point (emphasis added):
State workers pay a lot of money for their pensions. We put 8.75 percent of each paycheck into the pension fund — higher than any other state employee in the country pays for this kind of plan. This contribution rate covers 85 percent of the pensions' normal costs. Slashing the pension plan that we have been paying into for decades isAnd if Governor Carcieri gets his way, he will be no better than Bernie Madoff or anyone else who succeeded in swindling working families out of their hard-earned money. ... It takes 10 years of service to become vested in the state employees' pension system. After a worker pays into the system for a decade, his or her benefits are supposed to be guaranteed. But the governor's proposal would change the rules for all state employees and teachers who retire after April 1. Changing our pensions so drastically after many years of contributory service is similar to a bank's trying to tell you that you don't own your home after you have made faithful payments for 30 years. To suddenly change the pension system for people who contributed to the system and played by the rules is just plain wrong.
In the first instance, changing the pensions is more like a bank's changing the interest rates over time, which we all tolerate every day. In the second instance, vestment isn't full ownership. It's more akin to allowing a homeowner to borrow more money based on 10 years of equity; the bank still owns the house for 20 more years. And at any rate, the town could raise taxes, or some other expense could go up changing the totality of the arrangement that the buyer initially expected.
We can put that all aside, though. Let's accept Downey's premise that the government is responsible for promised retirement benefits. That doesn't mean that it has to find the money by raising taxes. It could also reduce other employee benefits to compensate. It could, for example, take a dollar-for-dollar reduction in healthcare, perks, salaries, and so on, in order to honor its deal with vested retirees. Downey calls pension reductions "stealing from workers." I can imagine what he'd say to the proposition of taking from them in order to give back to them.
Lack of Introspection, Chapter I've Lost Count
Over at RI future, Pat Crowley argues that General Treasurer Frank Caprio's beliefs must lie outside of the Rhode Island's Democrat party mainstream, because the Treasurer appeared this weekend at an event sponsored by the Rhode Island Statewide Coalition…
It seems strange to me that Caprio, an elected Democrat, would spend any time with an organization that seems intent on attacking core Democratic values and constituencies. Just a quick perusal of the web site shows their antipathy for what even centrist Democrats believe (never mind us on the Democratic wing of the Democratic Party).Later this week, Mr. Crowley (along with East Providence Education Association President Valerie Lawson) will be appearing in a public forum with members of the International Socialist Organization.
I'll leave it to readers decide, using Mr. Crowley's own criteria, what this tells you about where the views of "the Democratic wing of the Democratic party" lie.
An Odd Ethical Control
This observation doesn't necessarily have any implications for Brian Stern, Governor Carcieri's chief of staff, but this strikes me as a peculiar anti-corruption strategy:
In a March 9 letter and subsequent conversations with [ethics] commission staff, he acknowledged having applied for openings as a Superior Court judge and chief judge of the District Court and asked whether he was barred by the state's "revolving-door" law from making the leap directly from a top position on the governor's staff to the bench.The law was aimed, in part, at preventing top-tier state officials from using their inside influence to land judgeships, but it also contains an exemption for people with at least five years of "uninterrupted state service."
This is the relevant legal language:
(o) No person holding a senior policy-making, discretionary, or confidential position on the staff of any state elected official or the general assembly shall seek or accept any other employment by any state agency as defined in § 36-14-2(8)(i), while serving as such policy-making, discretionary, or confidential staff member and for a period of one year after leaving that state employment as a member of the state elected official's or the general assembly's senior policy-making, discretionary, or confidential staff.(2) Notwithstanding the foregoing, a person holding a senior policy-making, discretionary, or confidential staff position who has a minimum of five (5) years of uninterrupted state service shall be exempt from the provisions of this section. "State service" as used herein means service in the classified, unclassified and nonclassified services of the state, but shall not include service in any state elective office.
How does it lessen to possibility of corruption that a person takes five years to develop sufficient "inside influence" to acquire a judgeship?
"Lou Dobbs Tonight" Highlights (sort of) Rhode Island
Ten percent unemployment and Forty Sixth worst business tax climate. Can there be a connection ...?
March 22, 2009
Where Should the Burden be Placed?
The Kent County Times reports that the West Warwick school district is making progress on its $3.1 million deficit.
The savings of $555,000 through the end of Fiscal Year 2009 will not close the $3.1 million deficit that the schools still face, [Director of Administration and Transportation Michael] Petrarca admitted. But the contract, which was approved by both the school committee and the union but has not yet been ratified, is only part of the recovery plan, he emphasized.“We said that we’re not going to try to keep teachers shouldering the whole burden,” Petrarca said. “We have one more contract to negotiate [with Council 94] and will begin negotiations next week. We will be reducing 20-30 positions in the district, which we can do because the enrollment is decreasing.”
Often the question of burden is raised - during budget season and especially now, when contracts are coming up for renewal during tough economic times. Isn't this pretty straightforward? Shouldn't the "burden", or necessary budget reduction, be distributed proportionally to the spending categories in the budget? How else would it be done?
Accuracy of E-Verify
In her statement to Anchor Rising, one of the bases for Lieutenant Governor Roberts' opposition to e-verify was accuracy. She is not the first to express such reservations. In fact, it is the most commonly voiced concern about the system.
Some easy research, however, would quickly allay these concerns. From the Department of Homeland Security:
Currently, approximately 96.1 percent of qualified employees are cleared automatically by E-Verify, and 99.6 percent of all work-authorized employees are verified without receiving a tentative nonconfirmation or having to take any type of corrective action.
Geitner and the Administration's Fiscal Philosophy: the Perfect Match
President Obama has no intention of dumping Treasury Secretary Geitner.
Embattled Treasury Secretary Timothy F. Geithner's job is safe and the subject of resignation has not come up in his conversations with President Obama despite calls from some in Congress for Geithner to step down, the president said in an interview to be broadcast tonight on CBS's "60 Minutes."
This is good news. Staggering, pointless deficits created by dubious bailout packages, jacked up social spending and expenditures on pork which look diminutive only because they sit in the middle of gargantuan spending bills. Pointlessly exorbitant environmental and energy programs which will serve only to choke off industry and drain wallets. This administration has already signed some irresponsible and seriously misguided - make that dangerous - fiscal policies and, alarmingly, intends to proceed with more.
Who better, then, to lead the money department than someone whose brief tenure seems to be comprised of fumbles, large and small, starting with his first major initiative described by the New York Times as only an "outline" of a bank bailout plan and now accusations that he failed to alert anyone to taxpayer funded bonuses. (After all, how many dollars can one man keep track of? Actually, if they're tax dollars, he needs to keep track of all of them. On another front, while this does not excuse any of Mr. Geitner's missteps, it would be good if someone would hire him some lieutenants. And filling staff level vacancies at Treasury might move along a little quicker if someone would REPAIR THE DAMN WEBSITE. )
Add in the initial, brusque message - our tax laws apply to almost everyone - conveyed by the appointment of a tax evader to this of all positions and Timothy Geitner has, indeed, turned out to be "uniquely qualified for this job", though perhaps not in the way that the President originally envisioned.
A Gracious Invitation to Vice President Biden
Further to Vice President Joseph Biden's comments
Looking to strike fear and compliance in the hearts of local officials, Vice President Joe Biden warns that if they use money from the economic stimulus fund to build what he regards as the wrong kind of projects, “I’ll show up in your city and say this was a stupid idea.”“No swimming pools!” he implored. “No tennis courts!” he begged. “No golf courses!” he pleaded. “No Frisbee parks!” he exhorted.
“This can’t be government as usual,” he told an assemblage of local officials invited to the White House from around the country.
earlier this week, a "New Business" item on the agenda for last Thursday's RIGOP Convention included this resolution. It concludes
We the members of the Rhode Island Republican Party do hereby extend an invitation to the Vice President to come to the City of Pawtucket at his earliest convenience and show that he is a man of his word, that his threats are not idle, and declare to the American public that expending $550,000 of stimulus funds on a skateboard park and renovations to tennis and basketball courts is a "stupid idea".
RISC Winter Meeting: Governor Don Carcieri on Budgets, Benefits, and the Future
Governor Don Carcieri was the final speaker at the Rhode Island Statewide Coalition's Winter Meeting (stream entire speech):
- RISC Chairman Harry Staley's introduction: stream, download
- Opening remarks — coverage of the budget proposal has been "incomprehensible"; "politics is a contact sport"; "I am mad as hell": stream, download
- The need for RISC and citizen action — American Revolution began with just a few taxpayers who had had enough: stream, download
- The problem — "We have gotten ourselves into a position over decades"; Look around the country and see all the states that have grown and prospered over the last decade: they are all the low-tax, right-to-work states, where businesses are happy to go there": stream, download
- On state employees — "I don't blame them. If you can get it and your employer is dumb enough to give it to you": stream, download
- Riling up — "I'm tired of just talking around the edges"; "The reason we are where we are with spending and these benefits are out of control is you've got special interests — number 1, unions — state employees unions that are controlling this"; "They've been masterful, and are getting more masterful every day, and you're seeing it happen right now at the national level.": stream, download
- Countervailing force needed — "In playing the game, that means there's got to be a countervailing force."; "What I'm talking about is a party system that is essentially a monopoly... They just do what the leadership wants done, and the interest groups that are up there every single day.": stream, download
- Wall Street Journal editorial about taxation in Illinois — "Everything I say here, think 'Rhode Island.'": stream, download
- We are improving — "This doesn't happen over night."; after pension change, over 1,200 people left, so state employment is at its lowest point since they've been counting: "It isn't any surprise why your property taxes are constantly under pressure, because most of the money that the towns and cities and states spend is for people.": stream, download
- On being competitive — "We've got to be competitive from a tax standpoint as a state... News bulletin! News bulletin out there: The government does not create jobs."; "The government's job is to create the environment where the private sector creates jobs, employs people, makes higher wages, and grows the wealth of the community.": stream, download
- We need to lower taxes across the board, not just one-off deals — "The beauty about reducing and eliminating our corporate income taxes is that everybody's in the same boat.": stream, download
- Must move now — "We are at such an axis point, right now. This is it. This year, either we're going to do the things that we need to position this state to really prosper and to be able to sustain what it is we're doing, or we're not... It's not a foregone conclusion.": stream, download
- Need to change our municipal operations, such as consolidating services on Aquidneck Island: stream, download
- On the budget and stimulus — "There's a lot of confusion about what we're doing in this budget, what we're trying to accomplish."; "From my standpoint, there's three philosophical issues related to the so-called stimulus. ... A chunk of this stimulus money was... to help the states bridge [the revenue fall-off]. ... The hard choices are still there; they're not going away just because of this money."; "The second principle in this was, there's a lot of people out of work... so it was trying to help them."; "Third principle: Create jobs, but the only part of this whole package that's going to create jobs tangibly is the highway and bridge funding."; "I'm trying to get tax reform into place now because it's the only thing that's going to be our salvation going forward.": stream, download
- On motivation and legacy — "I want to make sure that I'm leaving this state in a position that it's going to prosper; that's all I care about... change decades of bad behavior and bad habits."; "There's no other agenda. I'm not running for anything.": stream, download
- Closing remarks — "You are the only hope. It's true. Don't look scared."; example: killing the Economic Death and Dismemberment Act last year; "We can do this, here. We're right on the cusp.": stream, download
RISC Winter Meeting: Treasurer Frank Caprio on Debt and Pensions
Third on the schedule at the Rhode Island Statewide Coalition's Winter Meeting was RI General Treasurer Frank Caprio (stream entire speech):
- RISC Chairman Harry Staley's introduction: stream, download
- Caprio's opening remarks (and shout-outs): stream, download
- Mock description of U.S. and RI governments as investment opportunities: stream, download
- Why are these entities able to find investors to cover debt? Private enterprise: stream, download
- Expressing intentions to "move things in the right direction (i.e., lowering taxes, increasing transparency, and furthering "strong financial management": stream, download
- Reviewing the pension system's history in RI — "Is there any mystery as to why we as taxpayers are slated to pay a billion dollars of taxpayer money into the pension system in just seven short years?": stream, download
- The solution — "being addressed right now by the state legislator": stream, download
- "The problem is that we have twenty years" to go" to fully fund pensions" while pursuing changes in health and logevity increases: stream, download
- Closing remarks, insisting that we not saddle future generations with our problems:: stream, download
March 21, 2009
RISC Winter Meeting: EPTA's William Murphy Encourages Engaged Citizens
The second speech at the Rhode Island Statewide Coalition's Winter Meeting came from the East Providence Taxpayers Association's William Murphy, who focused on local-level movement building (stream entire speech):
- RISC Chairman Harry Staley's introduction: stream, download
- Murphy's opening remarks: stream, download
- We must focus on our effectiveness as citizens: stream, download
- Step 1 is to formulate our goals clearly: stream, download
- Step 2 is to "offer the average citizen opportunity to constructdively participate," because "citizens have abandoned the public square": stream, download
- The reform movement needs to strengthen local taxpayer groups — "we are learning in East Providence that shining the light on the process makes a difference": stream, download
- Describing the situation in East Providence and suggesting that the solution lies elsewhere than on taxpayers' backs, but that taxpayers must be more involved: stream, download
- Closing remarks: stream, download
RISC Winter Meeting: Gary Sasse Talks Taxes
Giving the first speech at the Rhode Island Statewide Coalition's Winter Meeting, Gary Sasse, Governor Carcieri's Director of the Department of Administration, spoke about tax policy (stream entire speech):
- RISC Chairman Harry Staley's introduction: stream, download
- Sasse's opening remarks — we compete for capital and labor, and tax policy affects our success: stream, download
- The reason for a Tax Policy Workgroup was our lack of competitiveness — we were "taking money out of the private sector and putting it in the public sector in a very uncompetitive way": stream, download
- The need for reform to prepare for the end of the recession: stream, download
- The tax reform in the governor's current budget — increase exemption of estate tax, phase out and eliminate the corporate tax ("That is the perception change we need. That is a bold step."), decrease personal income taxes ("Every income group, up to a half million dollars, pays lower average income taxes under the proposed system."): stream, download
- Closing remarks: stream, download
The Bastard Boom
It's a harsh title, I know, and I wouldn't have run it but for the very fact of diminishing stigma evidenced in recent statistics (which is to say that the term "bastard" has no real social force in accord with its actual meaning*):
The 4,317,119 births, reported by federal researchers Wednesday, topped a record first set in 1957 at the height of the baby boom.Behind the number is both good and bad news. While it shows the U.S. population is more than replacing itself, a healthy trend, the teen birth rate was up for a second year in a row.
The birth rate rose slightly for women of all ages, and births to unwed mothers reached an all-time high of about 40 percent, continuing a trend that started years ago. More than three-quarters of these women were 20 or older.
For a variety of reasons, it’s become more acceptable for women to have babies without a husband, said Duke University’s S. Philip Morgan, a leading fertility researcher.
Even happy couples may be living together without getting married, experts say. And more women — especially those in their 30s and 40s — are choosing to have children despite their single status.
With cultural trends, causes and effects jumble over each other, so it presumes too much to tease them apart in search of the decisive, but analysts and reporters do a disservice to the public by not mentioning, in this context, the concerted movement over the past decade-plus to redefine marriage as something not intrinsically related to child bearing and rearing. Writing the radical new definition into the law would burn the bridge by which we're crossing into cultural no-man's-land.
That is one way in which same-sex marriages does indeed affect society at large.
* Certainly, I believe it to be to the unmitigated good that children born under such circumstances face less social stigma than once was the case (if any at all). That the parents appear to face less and less, however, is among the contributing factors to our society's decline.
A Winter Meeting in Spring
What better way to spend the first Saturday of spring than listening to political speehes at the Rhode Island Statewide Coalition's Winter Meeting?
RISC Chairman Harry Staley is currently making opening remarks. Frank Caprio has been walking the room. Ed O'Neil is here. And the governor just walked in with his entourage.
9:42 a.m.
I've been battling unexpected technical difficulties. Gary Sasse explained some necessary tax changes. (I'll have audio up later.)
East Providence Taxpayer Association's Bill Murphy is now talking about the need for citizen activism, making arguments that would be very familiar to Anchor Rising readers and has progressed to describe circumstances in his native East Providence.
10:05 a.m.
Next up is Treasurer Frank Caprio:
As it happens, Mr. Caprio was Harvard classmates with the previous speaker. Every now and then a carpenter is reminded how connected others are.
By the way, Mr. Caprio pointed out, during his opening remarks that Warwick Mayor Scott Avedisian snuck in behind me.
10:11 a.m.
Caprio is giving a brief history of state pensions. The tale begins in the 1930s and winds through decades of General Assembly failure to adjust... in the right direction.
"When groups say that they're being unfairly attacked... the issue is that the equation has been changed to make it much better for one side." (slight paraphrase)
10:16 a.m.
Mr. Caprio is describing that we're 10 years into a 30 year plan to balance our pensions, but he's not really expressing a plan. His message is more that the legislature is currently working on it. "We're trying to be fair," etc.
Incidentally, I see that Rep. John Loughlin has entered the room and is standing next to Avedisian. Oddly, to his left. (I kid... not about the positioning, just its import.)
10:24 a.m.
Now it's the governor:
His first point was to suggest that coverage of the budget hasn't been reliable: "The only thing incoherent about the budget is the people who are writing about it."
Next he mentioned some of the former Ivy League athletes in the room, the point being that we're in the midst of a contact sport, and he's "mad as hell."
10:27 a.m.
"We are hanging in the balance." I haven't heard the governor speak all that many time, but he's certainly more fired up than what I've perceived to be his norm.
10:30 a.m.
The states that are in the best position, right now, are all the low-tax, right-to-work states. Regarding lavish public-sector union benefits, Carcieri doesn't blame the state workers: "If you can get it, and your employer's dumb enough to give it to you..."
10:34 a.m.
"I've been in this six years; I'm tired of talking around the edges." The reason that we're in this mess is the special interests that control the legislature.
The interests are "masterful" and they're getting better and better. You can see it at the national level. Point being that we the citizens have to begin making the same moves: running candidates against elected representatives who go the wrong way, organizing, and so on.
10:36 a.m.
Legislators can't move around the State House without being "descended upon by people who want something." We need "a countervailing force."
10:39 a.m.
Carcieri just read an editorial in today's Wall Street Journal about Illinois that might as well be describing Rhode Island.
10:44 a.m.
Addressing the media directly: "News bulletin! News bulletin: The government does not create jobs."
Rather than giving tax breaks to incoming companies, the governor would like to reduce or eliminate corporate income taxes.
"This is it. This year, either we're going to do the things that will enable this state, or we're not... It's not a foregone conclusion, by the way."
10:49 a.m.
When Carcieri taught at Rogers High School in 1965, it was the only high school on the island, and Jamestown kids took the ferry over. "There ought to be one school system [on Acquidneck Island], one police department, on fire department on the island."
10:55 a.m.
Closing with three "philosophical principles related to the stimulus package:
- Hard choices are not going away because of stimulus.
- Unemployment is high, and we need to help them and to create jobs. "The only part of this package that is going to create jobs is the highway and bridge component." The governor specifically mentioned
- Use this money as a bridge extending beyond the date when the federal money dries up, specifically by leveraging it to enact tax reform.
10:59 a.m.
"I want to see the state do well; I got no other agenda. I'm not running for anything."
11:01 a.m.
Governor Carcieri framed his speech with a comparison with the American Revolution. It doesn't take many people to get things moving, and we can turn the state around.
11:03 a.m.
Now a Q&A session with all of the speakers. First up is a man from Middletown suggesting a reduction of retirement income tax. The governor is making the point that about 20% of the states payments to its retirees go out of state, a third of them to Florida. He's also restating his support for eliminating the income tax.
Another question from the audience is where the noise from the business community is. Carcieri: "Everybody wants to keep their head down, in this state, because they're afraid that if they stick them up, they'll get whacked."
11:28 a.m.
Interesting tidbit. Bob Cushman from Warwick asked whether the governor's proposed mandatory 25% healthcare copays at the municipal level will apply to contracts already in effect (such as the one just passed in Warwick providing for $11 weekly copays). The answer: No.
Keep that in mind taxpayers and municipal negotiators!
Tying Workers to Their Employers
The other day, a coworker and I had a discussion — while we worked, of course — about the many ways the law seems intended to lash us to our employers, in turn providing them with a measure of protection from competition. If they go out on their own, carpenters in Rhode Island must register with the state, which requires an application and fee as well as proof of liability coverage. Also on the form is a requirement of proof of continuing education, although that requirement is currently waived pending somebody's figuring out what carpenters could possibly need to know that they don't learn on the job.
Then there's the tax side. The self employed must pay income tax and self-employment tax, for which (as I understand) they are required to make quarterly estimated payments, all of which begins to make the hiring of an accountant an advisable option.
Then there's hiring employees. With a single hire, the new business must adjust for thousands of dollars in insurance and various payments, which leads many small players in the construction industry to hire employees as subcontractors.
And then there's health insurance, with which Congress looks likely to cinch employees a bit tighter:
Three powerful House committee chairmen have agreed to work together on legislation to overhaul the health care system, starting with the view that most employers should help finance coverage and that the government should offer a public health insurance plan as an alternative to private insurance. ...Many issues, including the question of how to pay for it, are unresolved. But the House chairmen said they had informally agreed to plow ahead on the assumptions that individuals would be required to carry insurance and that most employers would be required to help pay for it.
Of course, that required "healthcare assistance" will come right out of employees pay, yet it will create that much less incentive for employees to take educated risks to break out on their own, and providing it will create one more barrier to growth for the striving entrepreneur. All of which will increase employers' power over their employees, while increasing the financial benefit to most employees not at all.
Furthermore, as regulations seek to provide workers protection, they create incentive for employers to behave in ways that would leverage loopholes. With Rhode Island's unemployment insurance system, employers have reason to motivate employees to quit (or to trick them into doing so, as I have seen done).
Eventually, we can hope, Americans will figure out — and elect representatives who appreciate — that freedom and opportunity are the best protections against abuse, poverty, and healthcarelessness.
Governor Patrick's Trivialities
Amidst a billion dollar state deficit, a flagging economy, a state hiring freeze and a raging debate about whether to raise tolls or jack up the gas tax (with the smart money on a compromise - "what the heck, let's do both"), Massachusetts Governor Deval Patrick has been focusing on the important things.
- Appointment of a senator to a long-dormant $175,000 job;
- Hiring of a heavy campaign contributor to the newly created post of director of real estate services; annual salary: $120,000. (Did I mention the state's hiring freeze?)
- Hefty raises for a couple of sheriffs.
Add to that his Turnpike Authority which has implemented his campaign promise to lay off toll takers by hiring two staffers at a nifty $100,000 per annum.
I said these items are important, didn't I? My mistake. They are not important.
A dismissive Gov. Deval Patrick yesterday belittled as “trivial” recent exposes detailing plum jobs and fat raises to the politically connected under his watch, saying the controversies won’t distract him from “meaningful” issues.“One of the challenges in life is concentrating on the meaningful and letting the trivial take a back seat,” Patrick said in the Senate reading room, after a reporter asked him whether patronage-packed Beacon Hill still has credibility with the public.
“I sometimes feel like I’m in a profession now where that is completely upside-down,” he added.
Funny, we feel that way, too, Governor. It might have been better to have skipped the trivialities altogether.
March 20, 2009
More Famous than Del's and the Big Blue Bug?
The blog on General Treasurer Frank Caprio's Web site lists the number of references captured by Google for familiar Rhode Island names. As the post admits, results change each day, but the only way I can even come close to duplicating the numbers is to leave off the quotation marks, without which Google will return any page that has every word in any order, for some and include them for others. So, without quotation marks, a search for the Big Blue Bug will tally every page that has the words big, blue, and bug anywhere on them.
Out of curiosity, I've recreated the list using the quotation marks:
- Rhode Island: 110,000,000
- State of Rhode Island and Providence Plantations: 153,000
- Rhode Island and Buddy Cianci: 16,800
- Buddy Cianci: 40,900
- Roger Willams and Rhode Island: 571
- Del's Lemonade: 12,400
- Coffee milk: 394,000
- Clam cake: 2,990
- Salty Brine: 48,600
- Bruce Sundlun: 7,230
- Big Blue Bug: 7,930
- Ruth Buzzi: 70,600
- James Woods: 1,060,000
- Quahog: 430,000
Anchor Rising, for those keeping score, returns 28,500 results.
Last Word on the Flag Incident
The official last word - what, if any, disciplinary action the Providence School District will take against Mr. Robert Perkins - is now a week overdue, hopefully because the district is reconsidering a bad initial decision.
In the meantime, David Quiroa had a pretty balanced take in Tuesday's ProJo.
First and foremost I have to make clear that I believe that every flag that represents the people of a country must be given the utmost respect because it’s the reflection of the soul of a nation. By now everyone reading this note may be aware of the incident that took place at Roger Williams Middle School, in Providence, the other week when Assistant Principal Robert Perkins allegedly stepped on a flag from the Dominican Republic. I do not condone the action of stomping on any national flag — yes, including our beautiful red, white and blue.After reading all the reports about this issue in The Journal and hearing the extensive testimony by Mr. Perkins on WPRO’s Dan Yorke Show, I have come to the conclusion that Mr. Perkins did need to give a sincere apology. However, everyone else should let the school authorities wash their own clothes and there is absolutely no need to have the U.N. issue a resolution.
I have five kids and I can tell you that if my kids are running around our living room breaking things and having a food fight and they happen to be holding a Guatemalan flag I would probably take the flag and throw it on the floor — not out of hate to the flag but out of stress. We must analyze every situation in its proper context for justice to prevail.
DAVID A. QUIROA
Newport
Lobby Lobby Lobby Get Your Handouts Here
Steven Stycos at the Phoenix has a good piece explaining the various lobbying influences being exerted at the State House. The focus is on corporations:
Last year, the insurance industry was the biggest spender on lobbyists, dedicating more than three-quarters of a million dollars to getting its way, according to a Phoenix review of lobbying disclosure reports. In addition, the gambling, banking and finance, hospital, drug, and energy industries each spent more than $250,000 to hire lobbyists, according to the Phoenix compilation.And, as Stycos explains, it's hard to ferret out the extent of lobbying activities.
Public concerns about lobbying have focused on financial ties between legislators and lobbyists. In January, the Providence Journal reported that lobby groups including Rhode Island Housing, the Laborers' International Union, and Newport Grand failed to report their well-known financial links with state legislators. The success of lobbying groups in defending their interests, often at the expense of the public interest, receives far less attention, however. Part of the problem is that the law allows lobbyists and their clients to file vague reports.Here are the Big 6 lobbying interests:Some lobby groups, like the Rhode Island Bankers Association, the Rhode Island Federation of Teachers, and ExxonMobil, report the bill numbers they monitor and whether they support or oppose each one. Most groups, however, use a lobbying law provision that allows them to report their interest in general subject areas, not specific bills. Some major interests only needed one word to describe their activities at the State House. The Rhode Island AFL-CIO, for example, reported that its three lobbyists were concerned with "Labor," while National Grid related that its six lobbyists monitored legislation on "Energy." Community Financial Services of America reported its interest in "Financial Services."
INSURANCE: $779,079While the piece highlights the dollars spent by corporations, it would seem that labor interests are a noteworthy absence. However, the AFL-CIO's George Nee helpfully explains why unions don't need to spend as much money as corporations when it comes to pushing their agenda:
GAMBLING: $511,036
BANKING & FINANCE: $426,256
ENERGY: $386,082
HOSPITALS: $383,874
DRUGS: $337,921
Notably absent from the list of big spenders, though certainly a force on Smith Hill, is the Rhode Island labor movement. Unions reported spending about $100,000 on lobbying. AFL-CIO Secretary-Treasurer George Nee says union expenses are comparatively low because most unions use staff and members to lobby. Union staff salaries, he explains, "are considerably less" than those of lawyers and corporate staff.I wonder if someone has done a cost-benefit analysis of "Time at GA vs. Dollars Reported as Spent for Lobbying" to determine which group is the most efficient?
Stimulating Ignorance of the Problem
So Rhode Island — indeed, Tiverton — may be providing the first instance of the federal stimulus at work:
It will surely be the first in Rhode Island and there's a chance that a Main Road, Tiverton, rebuilding job could be the first federal stimulus job in the nation."We've already had some inquiries from national media," said Frank Corrao, chief of construction for the state Department of Transportation. "We're not sure but we hear that this one could be the first."
In whatever coverage there may be of this milestone, in whatever political grandstanding, will anybody ask the critical questions: Why did we allow this road to reach this point, why did it require once-a-century federal largess to fix it, and what can we do to ensure that our transportation infrastructure doesn't continue to deteriorate to this state?
I'll guess "no." From the print edition of the story:
Mr. Corrao said that while this has been a "priority" job for some time, it was backlogged with many others due to lack of funds. It is a job that needs doing, he said, "but the money wasn't there."
Then where was it?
Latest on O.S. Follies; Charlie Hall's Latest
The Ocean State Follies will be performing at Luigi's tonight.
... okay, okay, I confess! The above plug was an excuse to run one of Charlie Hall's recent cartoons.
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Good Night, Sweet Tiverton
I hadn't planned to attend the Tiverton Budget Committee meeting on Wednesday night, so when my eyelids became heavy around 9:30, and with the meeting looking as if it had settled into a series of unanimous votes on heavily debated dollar amounts, it was easy to talk myself into heading home. I wish I'd stayed:
All but one voting member of Tiverton's Budget Committee supported a proposal to move the town's financial town meeting to a later date, when more concrete state aid figures are available.The vote came at the end of a long budget meeting Wednesday night, and just days before the Town Council is scheduled to meet and discuss whether to ask the General Assembly for the ability to postpone the meeting, which the town charter states is to take place the second Saturday of May. ...
Budget Committee Chairman Jeff Caron did not vote on the motion, and Vice Chairman Robert Coulter voted against it. The chairman usually votes only as a tiebreaker. ...
Sanford Mantell, a newly elected member of the Budget Committee, said he didn't have a problem with a request by Town Council President Donald Bollin for "unified" support from the Budget Committee to move the financial town meeting to a later date.
Some committee members made it clear that they would not want the meeting to open on May 9 only to be recessed to a later date. That would disenfranchise voters and cost the town additional money, they said.
Caron said the committee will continue to work on its budget recommendations and have a docket ready for May 9 if the meeting does end up convening on that date.
I very much hope I'm wrong about this, but it appears to me that the powers of Tiverton are in the midst of another scheme. Facing unexpected push-back from the budget committee, the town council and school committee squeezed their budgets as hard as they could even pretend to be doing. (Recall statements from the town side that the draft budget that they approved is "too low," even presenting a danger to residents.) Between that, some likely fudging of probable contract terms, and a very deep dip into reserve funds, the town brought the expected tax increase below the state cap.
That will depressurize some of the incentive for citizen activism, and a postponement of the financial town meeting will push actual decisions into the lazy summer, perhaps after municipal and school contracts are a done deal. No doubt, town officials are still hoping for the magic Obama money to save the day, but I suspect they're already planning methods of peeling the facades from the budgets and coming on strong with the message that "we must raise taxes" because we're awash in "obligations."
Business as usual may be in the middle of a hiccup, but it remains the paradigm, and when our eyes clear, we'll see whether the town's gamble that the world will go back to the way it was has paid off. Me, I think Tiverton's future gets a little bit darker every week.
As I said, I hope I'm wrong.
March 19, 2009
Scatting and Be-Bopping All Over the Paper
There isn't much advantage to pointing these things out, at the local level. Those who get it will see, and those who choose not to see won't get it. But I do wonder what the keepers of the Providence Journal's credibility think of reporter Alisha Pina's assessment that the following comment had sufficient content to include it in her article prior to today's Labor Board hearing:
Patrick Crowley, an assistant executive director of NEARI, said, "Having had the displeasure of reading this so-called report, it only serves to confirm Mayor Larisa and Mr. Felkner have no idea what they are talking about. Given their bumbling and lack of popular support this isn't surprising at all."
As they (might) say in the circus: You can't blame the clown. The quotation is a twofer for Crowley; he gets to mock and belittle his opposition and further the ailing state newspaper's decomposition into a rag. Crowley's entire raison d'etre in the RI scene is to serve as a distraction from the real players and schemes of the union industry in the state. A pity ostensible journalists haven't the instinct to see through that, perhaps even to the extent of seeking the story behind the jester's curtain.
Somebody on Fountain St. must understand ... right?
A Clarification in the Other Direction
Lest I be misunderstood, perhaps a note's in order stating that I support the Ocean State 38 initiative that Travis Rowley describes. As a political organization, the RIGOP must reinvent itself at the local level and build from there — not just for fundraising, but in order to get to know voters and to identify candidates.
Basically, the RIGOP has to be visible among the various reform groups and amidst the political backlash against Rhode Island's status quo.
It will be critical, however, for the party to present itself as just another group interested in a larger cause than itself. Each local member of the Ocean State 38 should engage with all reform activities, and without the implication that they intend to subsume them. An approach that errs on the side of arm's length assistance, rather than political opportunism, will rebuild the party more quickly. The question to answer is, "How does the party fit within this grassroots movement?"
It most definitely has a place.
E-Verify and Rhode Island's General Officers
Anchor Rising asked all of Rhode Island's General Officers, other than the Governor, their stance on e-verify.
Governor Carcieri - Supports
Lieutenant Governor Roberts - Opposes. Her office issued the following statement to Anchor Rising.
Lt. Governor Roberts complies with all state and federal immigration laws when it comes to hiring employees in her office - including verification of appropriate documentation to confirm the eligibility of prospective employees for employment. All employers, whether public or private must and should comply with these legal requirements. The Lt. Governor continues to have concerns however about the reliability and validity of the e-verify system as well as the new burdens that this system may place on already distressed employers. Large scale errors in that system can compromise the rights of prospective employees who are American citizens as well as legal immigrants. Until the system is improved and reliable the Lt. Governor is uncomfortable with requiring RI employers to be burdened by a new system when they can already comply with the law in ways that may be more appropriate to their businesses.
General Treasurer Caprio - Er, judge for yourself
Attorney General Lynch - No response
Secretary of State Mollis - No response
Our Movement Needs a Common Focus, Not a Common Label
In attempting to navigate the difficult waters that separate my employer and the clients on whose property we labor, I've at times been called "The Diplomat." I very often disagree with his decisions and, even more often, his methods, but there's a job to be done, and it requires that responsibility be properly allocated and that everybody's opinions contribute to final decisions without having differences break communication down to static. Everybody's got their own intentions and purposes, and the combination thereof sometimes reaches the brink of utter incompatibility. If I want to get a particular job done and move on with my life, that's not a functional place to remain.
I bring this up in response to the dispute between Travis Rowley and Ken Block, the latter of whose comment appeared earlier today on Anchor Rising.
Right now Rhode Island desperately needs to be shaken — and hard. Movement in any way toward the political and economic right is movement in the correct direction, and we who are doing the pushing will only trip each other up if some of us don't remain explicit about the extent of our cooperation and the limits of our commonalities.
Overstating will be a very easy thing to do, and emotions are going to be running high throughout the involved class of Rhode Island. We need circumspection and, yes, occasional internal diplomacy.
Ken Block: "Moderate" Is Not Another Word for "Republican"
Travis Rowley, Chairman of the Rhode Island Young Republicans, in a recent posting discussing the Ocean State 38 on the Ocean State Republican blog, purposely and inaccurately attempts to link the Moderate Party of Rhode Island to efforts to rehabilitate the RI GOP.
In his post, Travis attempts to show that the RI GOP has lots of grassroots support due to the existence of "right-of-center" advocacy groups.
I also believe in the individuals taking up our cause—the people within and supportive of the RIGOP. The RIGOP is buttressed by a local conservative uprising. Evidence of this is the recent explosion of right-of-center advocacy groups. Each in their own way, these organizations and their members serve as crucial components to Rhode Island's Republican reform effort. Included in this list are:The Rhode Island Statewide Coalition — RISC
The Rhode Island Republican Assembly — RIRA
The Ocean State Policy Research Institute — OSPRI
Anchor Rising — www.anchorrising.com
The Moderate Party
Operation Clean Government
Transform Rhode Island
Rhode Island Young Republicans
Rhode Island College Republicans
The Republican Jewish Coalition
Rhode Islanders for Immigration Law Enforcement — RIILE
Speaking for the Moderate Party of RI, I can attest that Mr. Rowley made no attempt to contact us and ask if in fact our group was in some way endorsing or participating in some manner in the reform of the RI GOP. For the record, we are not.
While it is a safe assumption that any group with the word Republican as part of its name will be an active supporter of the state GOP, it is a monumental and irresponsible stretch to make that same leap with at least some of the other organizations listed above.
Hijacking the support of non-affiliated organizations is hardly the way to burnish, re-brand or rebuild the image of the RI GOP.
Ken Block is the chairman of the Moderate Party of RI.
Talking About Bonuses
On last night's Matt Allen show, Monique and Matt shared disbelief at the disbelief that Congress (particularly one marble-mouthed representative) has expressed regarding AIG's bonus handouts. Stream by clicking here, or download it.
William Felkner: Is the State Labor Relations Board biased? You betcha!
The dispute between the East Providence School Committee and the East Providence Teachers' Union has focused attention of the Rhode Island State Labor Relations Board (SLRB), a largely obscure administrative body that referees disputes between management and labor. What little public information is available regarding the Board and its operations has caused taxpayers to be concerned that the process may be biased in favor of labor. And these are not new concerns.
In 2004, Governor Carcieri called for several SLRB members to resign after they ruled that child care workers providing services to children on welfare should be considered state employees. The far reaching effect of this decision could have opened the door for as many as 1300 state contract workers to become union members. That decision was eventually overturned by the Superior Court. At that time, it was noted that eight of the last nine SLRB decisions taken to the Supreme Court had been overturned.
Now, in 2009, we see another unsettling action from the SLRB that once again raises questions of bias.
In September, the East Providence School Committee filed a charge against the Teachers' Union consisting of three pages of detailed allegations of obstacles created by the union during the negotiation process. Two months later, the union filed a two sentence complaint against the school committee regarding more or less the same circumstances, the central allegation of which was that "no substantive discussions had occurred."
Despite the extensively documented submission of the School Committee regarding the Union's behavior, the SLRB administratively dismissed this complaint. Yet the SLRB sustained the charges of the Union as deserving of a hearing, despite the fact that they do not detail any conduct by the School Committee that constitutes a "refusal to bargain."
As if that didn't raise obvious questions of bias, a month later, when the union filed on additional grounds, the Board broke all records of dispatch in forwarding the matter. In the three years prior to the East Providence case, it took an average of 148 days for a filed charge to be reviewed and an average of 319 days to get a hearing before the board. The Union's charge from East Providence was approved in 36 days and will have a hearing in only 73. According to our research, the process has never moved this fast.
How the SLRB administrative decisions are made and why this case has been processed so much more quickly than any other will remain a mystery as discussions are held behind closed doors. It is easy to see why the public would be suspicious of the process given the apparent different treatment of labor and management interests in this case.
Cynicism about the responsiveness of government in Rhode Island is nothing new, but the Ocean State Policy Research Institute is committed to informed public discourse. Accordingly, we have earnestly undertaken to learn more about how the SLRB functions, who they are and how they make their decisions. We have examined the SLRB's last three years of decisions for evidence of their prejudices, whatever they might be. The unmistakable conclusion one reaches is that the SLRB lacks transparency and they lean toward labor.
From 2006 to the present, the SLRB has heard 19 cases, seven of which we have determined to contain substantive rulings that impact management-labor interactions. Every one of those major cases was ruled in favor of labor. The total scorecard for the SLRB, including cases with minimal impact, is 15 wins for Labor and four wins for management.
While the board's decisions are generally logically reasoned, that is different from saying that they are correctly decided. These kinds of decisions interpreting statutes, rules and regulations depend on analogy to previous results. The weight the Board places on these various precedents operates like a finger on the scale, and there can be no doubt it is tipping towards labor.
But don't take our word for it. We have created the Labor Relations Board Watch website (www.lrbwatch.org) to house our research along with public information we obtain to provide transparency. It is time that everyone takes a close look at the SLRB and engages in reasoned debate to create pressure for reform. It would be naive at best to think that the board's documented history of opaque behavior and perceptually biased decision making would change without intervention. We hope this website empowers citizens with the necessary information to let the Board members know that they are watching — a dynamic that is new to the SLRB. Gone will be the days that the Board pulls the economic strings of the public purse in virtual secrecy.
Bill Felkner is the president of the Ocean State Policy Research Institute, sponsor of the LRB Watch website and the Transparency Train public information portal.
In a Snap Judgment, the Crowd Might Matter
So the Ocean State Policy Research Institute has learned that the State Labor Relations Board is a very quick-thinking group (emphasis added):
By law, such proceedings must be open unless a recorded vote is taken to close the meeting and an explicit exemption under 42-46-5(a) is cited. Any votes taken in closed session must be reported. But SLRB minutes consistently failed to report "the vote of each member on the question of holding a meeting closed to the public and the reason for holding a closed meeting" as required by 42-46-4, and conspicuously fail to report the votes of members taken in these close sessions. The only remotely applicable exception to the Open Meeting Act that would allow a closed session is that for "any investigative proceedings regarding allegations of misconduct, either civil or criminal". But these board "investigations" averaged a minute and a half for the 44 cases reviewed in the last year and lately are down to about 30 seconds. For instance, last year's Nov. 18th executive session at which the East Providence School Committee's charges against the Teachers' Union were summarily dismissed lasted only five minutes and eight separate cases were decided, that's an average of 37.5 seconds each.
That finding certainly has implications for a meeting today, regarding which the East Providence Taxpayers Association said the following in a press release:
Representatives from over a half-dozen Rhode Island good government groups will keep a watchful eye on the decision of the Rhode Island State Labor Relations Board in its first hearing on the controversial East Providence teachers' union case at the Labor Board's offices, at 1511 Pontiac Avenue, Building #73 in Cranston on Thursday morning, March 19th from 9 AM – 12 noon.EPTA spokesman Bill Murphy said, "Good government groups around the state are alarmed by the bias against taxpayers and the School Committee the State Labor Board has displayed in its handling of this case. Representatives from these organizations will be on hand to keep a watchful eye on the Board's behavior in this important matter. It is obvious to all of us that the Labor Board should never have filed this complaint and should not be hearing this case. The Labor Board does not have the authority to order school committees how to spend their money. It certainly doesn't have the power to order them to break the laws against deficit spending. The Board simply does not have jurisdiction in this case. At a minimum, the SLRB should wait until the Superior Court issues a decision about whether the case even belongs before the Labor Board."
Anybody who's planning to attend should be sure to be on time. Given the board's habitual pace, the hearing could be over faster than a taxpayer can say "point of order."
March 18, 2009
Zeroing the Budget
I've arrived late to a Budget Committee meeting, having had other obligations. I feel like I've missed something; somehow the predicted tax levy increase for the coming year has dropped from low-to-mid teens to 3.75%.
I know the school department has laid off some people. The town has made a bunch of cuts. But that seems like a large shave. Of course, I'm pretty sure that the three big contracts that remain for negotiation are assumed at a zero percent increase, which raises the question of what effect postponing the financial town meeting — for which there's currently a coordinated push — would have.
As far as I'm concerned, though, assuming the numbers are accurate, the progress already made owes a lot to TCC and the pressure that it has brought to bear.
8:40 p.m.
The current discussion is whether the Budget Committee can reduce its working budget related to a decrease in longevity costs. Town Administrator Jim Goncalo argued that, even though the contracts are up for negotiation, the obligations still exist, so the Budget Committee would be, essentially, forcing the town to violate labor agreements.
As I've said, I'm getting the sense that, by desire and legal construct, local government sees its role as permitting the unions to continue their advancement.
9:03 p.m.
Budget Committee Member Tom Parker moved (an amendment) to reduce the fire department's overtime budget from $225,000 to $50,000. I think his reasoning is that the town intends to decrease minimum manning in the next contract, which has as its point a reduction in overtime.
9:08 p.m.
The town administrator just pointed out, with reference to a fire department work schedule, that in some months last year had three people on vacation at the same time.
Once again, though, the budget can drive negotiations to, for example, decrease minimum manning as well as spaced vacations.
9:12 p.m.
Tom's amendment fails. The fire salary item passes as listed on the current docket.
Latest on the Bonus Sideshow
The BBC reported last night that the US Treasury Department will hold back the amount of the bonuses from the next round of bailout money to AIG.
Ailing insurer AIG will pay back the hugely controversial bonuses it awarded after taking public bail-out money, the US treasury secretary says.In a letter to congressmen, Timothy Geithner also said $165m (£116m) would be taken from $30bn the firm is due to get as part of its government bail-out.
While it will hopefully quell foolish suggestions to create highly targeted (and therefore highly illegal) income tax brackets of 100%, this resolution has not derailed today's AIG hearing before Congress, where relieved outrage has not abated
The remarks did not assuage the anger expressed by both Democrats and Republicans in response to the bonus payments to workers at AIG's financial products unit. Frank called the payouts "wholly unjustified," while other lawmakers took aim at the firm's management
and clever new names for the firm were presented.
"AIG now stands for arrogance, incompetence and greed," Rep. Paul Hodes, D- N.H., said.
Congressman, you've made it awfully tempting to fill in the acronym CONGRESS.
The real outrage, of course, is Congress placing AIG (and other private corporations) in a position to hand out tax dollars to begin with as part of a very expensive and highly quizzical effort to stop or shorten the fiscal slide created in 1995 by Congress itself, along with the Executive Branch. Every indignant word spoken at that hearing today to the hapless Mr. Liddy should be reserved instead by that congressperson for a quiet session with a mirror.
UPDATE
Question for Congressman Frank: in view of the death threats received by AIG management and employees, is it altogether prudent to be requesting the names of those who received bonuses?
UPDATE 2
And a follow up, sir. Will you also be requesting the names of those employees at Fannie and Freddie due to receive bonuses? [H/T Drudge.]
What the Day Could Bring
I've been holding on to this column by Roman Catholic Bishop Thomas Tobin. Having come across no obvious hooks on which to hang it for a post, perhaps a cold-winded Wednesday afternoon is as good as any time for his helpful reminder:
Any given day might bring you surprises that will change your life completely – the death of a loved one, a diagnosis of a serious illness, the discovery that a spouse has been unfaithful, a kid getting hurt in a sporting event, a fire that damages your home, an unexpected layoff notice, a call from the bishop’s office – the list goes on and on. The ultimate surprise that could change your life, of course, is its termination. You could die today, or tomorrow.What are the lessons to be learned from the uncertainty of life? I can think of three. ...
The first is to not get too attached to the things of earth, since everything is transient, everything is passing. ...
The second lesson is to approach the world with humility, not to overestimate our personal importance in the grand scheme of things. ...
The third and final lesson is that we always have to be prepared for the final drama of life – our death.
Elsewhere in the column, Bishop Tobin makes clear that our days' surprises aren't always necessarily negative. All three lessons apply as much (if with slight difference) to surprise victories and blessings.
Life Experience Answers Loughlin's Question
A moment's review of one's own life will likely provide plenty of basis for answering Rep. John Loughlin's rhetorical question, by which he argues for preserving the pension scheme for vested employees:
How can we say to a valued teacher or employee that has contributed to a plan for ten, twenty, or nearly thirty years in accordance with the terms the state agreed to, that they now must work a decade longer and receive a reduced retirement?
When I was laid off from my job editing high-tech market research, I was fully vested in my portion of the company's Employee Stock Ownership Program. Thus, I kept the plan's current value, and I had the option of holding it or cashing it in, but it would have been ridiculous of me to expect the company to continue making its contributions. Perhaps you've known people who invested time and money in education and resources for careers that simply weren't as lucrative when the hopeful students were ready for them; such people are owed neither jobs nor refunds.
The simple fact that an interest group — such as Rhode Island's powerful unions — extract a promise from particular politicians cannot be taken as a guarantee that the government will permit general calamity in order to preserve benefits that no longer represent reasonable expectations. If they don't like the new terms of their employment, they have the same option that the rest of us have: Look elsewhere.
If Rep. Loughlin wishes to do right by the state's employees, he'd be better off trying to persuade them that making necessary adjustments now is the fair and just path toward honoring commitments as closely as possible while mitigating the suffering that Rhode Island's policies have imposed on its people.
Media Fogging the Card Check Debate
Mickey Kaus has been on top of "card check" from the get go. His latest takes on some of the media spin regarding the issue:
The labor side's ability to get reporters to use their version of card-check's controversial secret ballot provisions continues to amaze. Here's WaPo's Alec MacGillis:Kaus also points to this recent Rasmussen poll:The bill, first introduced in 2003, gives workers the choice of whether they want to organize by getting a majority of workers to sign pro-union cards, instead of having to hold secret-ballot elections.That's one finely-spun sentence there. Who are the "workers" who will have this "choice"? They are the union organizers mounting a unionization campaign. Do any other "workers" who sign or don't sign the cards have a "choice" of methods? a) The cards aren't to choose the method. They are to choose the union. If 50% of the workers sign the cards the union will have won, period. An election at that point is prohibited; b) The only way an individual worker could use this system to "choose" a secret ballot election is by somehow signing a card if it will help union organizers meet the 30% threshhold required for an election but refusing to sign it if it will give the union organizers the 50% that will kill the election. House Majority Leader Steny Hoyer recently outlined this complicated card-signing strategy with a straight face on the House floor. But of course no individual worker will know if his signed card will provide the 31% plurality or the 51% majority. Only the organizers know this. You could sign the card intending to provoke an election and discover that you actually prevented an election. There's no way for ordinary workers to reliably game the system in order to "choose" a secret ballot. c) The whole underlying dispute is over whether the act of signing cards is an accurate expression of worker choices, or whether it subjects individuals to subtle and unsubtle community pressure to vote against their real preference. By assuming that the cards represent the true "choice" of workers, Hoyer and others assume what is at issue.
National Survey of 1,000 Adults
Conducted March 13-14, 2009By Rasmussen Reports
1* Do most working Americans want to belong to a Labor Union?
23% Yes
44% No
33% Not sure2* [Answered Only By Those who are Non-Union Members] Would you like to belong to a labor union where you work?
9% Yes
81% No
9% Not sureNOTE: Margin of Sampling Error, +/- 3 percentage points with a 95% level of confidence
An Albatross of a Memorial to Slavery
People wonder why race remains an issue, why the United States seems to move forward so slowly. Well, does this memorial of guilt strike anybody else as bizarre?
More than 240 years ago, John and Moses Brown financed a slave ship bound for Africa. They also poured money into Brown University in Providence. Slaves worked on the first building, now University Hall.Yesterday, Brown University said it will recognize its slave trade past through a new memorial modeled on monuments and sites in New York City, Montgomery, Ala., and Liverpool, England.
But the memorial may not be built on the Ivy League school's Providence campus.
Both Newport and Bristol played major roles in the slave trade, which continued into the early 1800s, long after the state outlawed it. Many reminders of the trade — former auction sites, Colonial homes and Newport's slave cemetery — remain, Brown's Commission on Memorials said.
"It may be appropriate, in memorializing Rhode Island's role in the trade, to look beyond Brown's immediate neighborhood," the commission said.
One repudiates atrocities that are generations old by behaving differently — by correcting the patters of thought that led to them. Fixating on old sins serves to keep them alive and wreaking their harm.
As I browsed for this article on Projo.com, my eye happened upon another about violence in Providence. As a direct and practical matter, the two stories are unrelated, but culturally, it seems to me that erecting public monuments declaring "this is what your country thought of you" can only contribute to a subculture of deliberate isolation, feeding a well of anger.
Build monuments to the good and hopeful, to the noble sacrifice. We must never forget, but if we're to heal, our memorials should be living examples that the prejudices of the past no longer apply.
March 17, 2009
Continuing the Sakonnet Times Debate
The Sakonnet Times has put a letter in which I raise some concerns about the AFSCME labor contract online. (We'll see, tomorrow, whether it makes the print edition.) I'll be surprised if the new letter racks up the 3,482 views and 171 comments (and counting) of my last offering, but at least local folks have a chance to discover that there is another side — a reform movement — out there.
An Incomplete Diagnosis of Rhode Island
Some diagnoses of Rhode Island are akin to a doctor explaining to a patient that his vital organs are being squeezed without noting that a cancerous tumor is doing the squeezing. Such is the case with Benjamin Gedan and Philip Marcelo's lengthy piece on the front cover of Sunday's Providence Journal:
Having based its economy on old factories and thousands of small, low-technology businesses, Rhode Island was blissfully undisturbed by the toppling of Web-based businesses from Silicon Valley to Route 128 in Massachusetts.But by failing to build and attract innovative, science and technology-driven companies, Rhode Island finds itself with little support in a blue collar recession that is battering the construction, manufacturing and hospitality industries.
Companies are fleeing:
Ravaged by the recession, more than one in 10 companies in Rhode Island closed or moved away last year.
Citizens have low disposable income:
Even before the recession, Rhode Islanders did not have much buying power. The 2007 average annual salary here was $39,827, below the national average ($44,355) and trailing Connecticut ($59,174), Massachusetts ($55,819) and New Hampshire ($44,308).
During the housing boom, folks might have lived here, but they worked elsewhere:
"There was the reputation that you could get more for your money in Rhode Island than anywhere else in New England," Paul Leys, president of the Rhode Island Association of Realtors, said.
Vulnerable groups, namely immigrants and the poor, are to be found in abundance:
But [subprime lending] really took off in the boom years, in part because mortgage brokers targeted Rhode Island's large immigrant population, including low-income residents with only a basic grasp of personal finance, according to Edward M. Mazze, dean of the College of Business Administration at the University of Rhode Island.
As the print edition (but not the online version) points out, our collegiate imports quickly become educated exports, and our public schools have a high rate of dropouts.
But it isn't sufficient to note these problems and attribute it to "a combination of bad luck and bad planning." There are specific causes:
- Taxes are too high and government too intrusive.
- Our policies attract immigrants and other low-end workers.
- Unions are driving up costs and strangling our public education system.
- Regulations and mandates make it too difficult to succeed.
- And so on.
Businesses, while they'll form if there's sufficient demand, see no reason to tough it out and regroup in the state when circumstances change. Graduates have no opportunity to stay. Workers have little opportunity to advance. And nobody in power is taking the drastic steps that really must be taken to turn things around.
Rep Loughlin's Approach to Resolving Rhode Island's Unstable Public Pensions
[Anchor Rising, along with many other print and digital media outlets, has received the following "OpEd" from State Representative John Loughlin (R). Rep Loughlin has indicated elsewhere and elsewhen that he is considering a run for higher office in 2010.]
Toward a Federal Solution to Pension WoesRhode Island’s public sector and teachers’ pensions are in crisis and it’s not a problem that we can solve on our own. Due to a number of factors, our pension systems carry huge unfunded liabilities. Rhode Island is not unique in this precarious situation. According to the Pew Center for States the total estimated state pension liabilities nationwide are approaching $361 billion dollars. That means as states struggle to meet pension commitments, fewer and fewer funds are available to support education, build our roads and schools and provide tax relief to struggling families and businesses. A Federal bailout or infusion of funds, spread over time, is needed to keep our promises and free us from this system.
But not one dime of Federal funds should go to any state pension system without mandating permanent structural changes to ensure the system is self-sustaining going forward thus limiting the need for taxpayer dollars.
Our current system is nothing more than a legally sanctioned Ponzi scheme. Those contributing to the current system pay those who have retired. To end the current system would mean breaking the funding stream for benefit recipients leaving the state with an enormous bill.
Since our public sector pension’s inception in 1940, the state has not properly funded the system. This, coupled with an increase in lifespan, and a General Assembly, which made benefits increasingly more generous, set the stage for disaster. To make matters much worse, our pension funds are invested in the stock market, which has lost enormous amounts of value in recent months. In a sense, these circumstances, regardless of where the blame lies, have created a perfect storm of financial Armageddon.
At present course and speed, Rhode Island is faced with two very unpleasant outcomes. Either our taxpayers and economic activities will be crushed under the weight of massive new taxes to fund the system, or those who have built there lives, and faithfully contributed to the system, based on the promises made, will have their promised benefits sharply reduced or worse yet be turned away when it becomes time to collect. I was raised to believe that you must always honor your commitments, regardless of the circumstances. In short, promises made – promises kept.
To understand our retirement commitments, it is necessary to differentiate between the groups of public sector employees and teachers involved. The first group is the retirees, those no longer working, but drawing their earned retirement benefits. The second group is comprised of those employees who have become “vested” in our retirement system. These are the teachers and employees who have worked at least 10 years and have now been promised specific retirement benefits when they become retirement eligible and ultimately retire. The next group consists of those teachers and employees that have not yet been in the program for 10 years – thus not vested. The last group is made up of those employees who have yet to be hired but will be in the future.
Fundamental fairness dictates that we treat each of these groups differently. Remember - promises made, promises kept. I believe nothing we do should have any effect on the promises made to those who have already retired and those who are retirement eligible. Furthermore, the promise made by vesting must also be honored, respected and adhered to. How can we say to a valued teacher or employee that has contributed to a plan for ten, twenty, or nearly thirty years in accordance with the terms the state agreed to, that they now must work a decade longer and receive a reduced retirement? In addition to quite possibly being illegal, the broader issue is that of moral fairness.
We have a moral obligation to craft a solution that structurally changes the way we provide retirement benefits in a way that our taxpayers can afford while honoring our prior commitments to retirees and those vested employees.
One very compelling option calls for a 401K style plan similar to the Federal Government retirement program. This type of plan features a very small-defined benefit coupled with a 401K style self-directed and fully portable plan. But any plan for newly hired teachers and state workers needs to include many of the measures currently being proposed by the legislative Pension Study Commission, including longer working times and reduced or eliminated cost-of-living-allowances to make the system self-sustaining going forward.
In the past year, our federal government has spent $1.5 trillion ($1,500,000,000,000) in order to stimulate our economy and bailout Wall Street - is Main Street not worth $361 billion over a period of years? An infusion of Federal funds would stabilize retirement systems in all fifty states. This would guarantee the promise of an honorable retirement to a generation of teachers and government workers while creating a system requiring almost no taxpayer funds going forward.
This would be a bailout not just for pension recipients but for all taxpayers and future generations. This type of bailout doesn’t reward Wall Street bankers, but puts our states on firm footing going forward with a fair system that we can all afford, while at the same time honoring our collective promises.
Ultimately, we will pass on a legacy of honor and affordability in a context where we as a society kept our word. Integrity is no small legacy to pass on to our children.
State Representative John J. Loughlin II
Minority Whip
District 71 Little Compton, Portsmouth, Tiverton
Chaos in Cranston
Last evening, the finance committee of the Cranston City Council voted to table the contract negotiated by Mayor Allan Fung with the International Brotherhood of Policemen's Local 301.
According to Mayor Fung, the contract would have saved the city approximately $1.4 million dollars over three years through measures that include not filling vacancies, implementing an 18-month pay freeze, implementing a gradual increase in employee healthcare co-share, eventually to 15%, and exchanging holiday pay for comp time.
- Mayor Allan Fung presents the contract, Part I
- Mayor Fung presents the contract, Part II
- Local 301 President Steven Antonucci speaks in favor of the contract.
- Steve Bloom, former independent City Council candidate, tells the council either approve this contract, or tell the Mayor an exact figure he needs to try to save.
- A large percentage of the amount saved would come from not filling police department vacancies, but the positions would still exist. Some committee members were concerned that this could trigger a sudden increase in expenses in the future, if the positions are eventually required to be filled. Mayor Fung says in the absence of this agreement, he could be required to budget and fill those positions immediately. (Mayor Fung and Finance Committee Chairman Emilio Navarro discuss the vacancy situation).
- Multiple members of the committee seemed to believe that, no matter what else was conceded by the union, the police should be required to pay a 20% co-share for their healthcare. Mayor Fung's response was that a) the value of the negotiated concessions is about equivalent to what a 20% co-share would save and b) based on what comparable communities are paying, if this issue is arbitrated instead of negotiated, it is unlikely that the city will get 20% (City Council President John Lanni, Mayor Fung, and Finance Chair Navarro on co-shares, savings and other contracts).
- The contract is automatically reopened, in the event the state requires a 20% co-share in all municipal contracts. The committee was concerned this created too much ambiguity to allow a decision to be made now.
Finally, if there is one thing that this meeting made absolutely clear, it is that tentative contracts need to be made available to the public for a reasonable period of time before they are voted on. I know that Rhode Island public employee union members sometime perceive this idea to be anti-union, but last night's meeting showed how it is not.
Allow me to defend that proposition by posing a question and by inviting anyone who attended last night's meeting to offer their take in the comments section: Which of the following options do you believe would best serve the cause of explaining the positions on all sides of a contract negotiation to the general public…
- Posting contracts in some kind of public forum, where questions and answers from knowledgable people could be exchanged for a week or two before a vote, or
- Trapping people in a room with Cranston City Council members, then disallowing them from discussing anything important until Councilmen like John Lanni and Anthony Lupino spend nearly an hour confusing themselves about how "special details" work, and then expecting the Councilmen to be able to understand that issue, all of the other contract issues AND be able to explain it all to their constituents?
I submit that, with direct access to information and a little time to process it, the public will be able to determine what's reasonable and what's not, much faster than this Cranston City Council ever will.
A Match Made on Bald Hill Road
The unions have made an honest blog of RI Future:
Working Rhode Island, a coalition of most of Rhode Island's labor unions, and RIFuture.Org, the State's premier political blog, announced a first of its kind partnership designed to increase the visibility of the labor movement in the online world. Through the partnership Working Rhode Island will use the RIFuture.Org blog to give an up close, first person account of the activities of organized labor throughout Rhode Island including the rallies, organizing efforts, contract campaigns, and legislative testimony affecting working people that often get overlooked by the mainstream media.
Yes. If one thing has been lacking at RI Future (especially since its ownership change), it's been the union point of view. If only the Poverty Institute could get in on the arrangement and the Projo's Political Scene could use RI Future as a source.
The Incredibly Shrinking Mandate
Inasmuch as people have a tendency to express approval or disapproval for subjective reasons and the popularity of policies isn't necessarily reliable evidence of their necessity, watching approval polls is a bit like watching traffic patterns in reaction to a fog. That said, perhaps these results will begin to move us past the silly declaration that Americans want the full dose of Obama's medicine good and hard:
According to the table of daily results, President Obama began his term with a strongly approve/disapprove differential hovering around thirty points; it's now four. His "total approve" has slipped from 65% to 56%, while his "total disapprove" has surged from 30% to 43%.
Watch for the emphasis to change from Americans' specific desire for a particular political platform to their general disgruntlement.
March 16, 2009
Who Is Outraged?
So let's understand this.
The government precipitates a fiscal crisis by
1.) Authorizing/encouraging banks to make bad real estate loans: President Clinton with the help of both Repubs and Dems in Congress;
2.) Repealing Glass Steagall: President Clinton, egged on by Senator Phil Gramm and with the help of both Repubs and Dems in Congress;
3.) Fending off all oversight and regulation of taxpayer-backed Fannie and Freddie: Congressman Barney Frank, all by his little self.
[Other/overlooked failures cheerfully appended.]
The government - one Republican president, one Democrat president and lots of Repubs and Dems in Congresss - then tries to fix the problem it created by shoveling massive amounts of our tax dollars out the door, much of it without strings or conditions (by the way, why didn't regulation-adoring Democrats scream bloody murder about this at the time? but this is intended to be a bi-partisan/anti-partisan post), in an effort to correct market and other forces that need to work themselves out "naturally". Side note: painful as that would be, it would be much less painful in the long run than dismantling what remained of a capitalist economy and converting to ... something else, whatever that would be.
Yet for the last couple of days, Congressman Frank, the junior Senator from Rhode Island and other federal officials have been very indignantly directing outrage at the private corporations involved for distributing bonuses that they (our elected officials) facilitated?
Getting out the calculator here ... Hang on ... Yup, trillions of dollars wasted on bailouts and stimuli is a larger amount than $165 million wasted on unearned bonuses.
I agree it is outrageous that hard earned (and not yet earned) tax dollars have been distributed in this and other irresponsible fashions. But with their high dudgeon pronouncements, aren't our elected officials really saying,
Pay no attention to the trillions we've spent like sailors on shore leave. Look! Look at those millions being spent over there!
In short, how can this dramatic reaction by our elected officials be viewed as anything other than a vigorous attempt to distract us and deflect blame from themselves?
Business Tax via Sales Tax
An article in last week's Sakonnet Times (not online) informs the reader that my representative in the State House, Jay Edwards, has submitted legislation reducing the sales tax:
"This legislation would stem the tide of consumers who leave Rhode Island to shop in Massachusetts just to save on the sales tax," said Rep. Edwards. "We must start thinking of ways to make our state more competitive instead of accepting the status quo and allowing Massachusetts and Connecticut to reap the additional sales."
The bill does not spread the tax to everything — as previous efforts have seemed to attempt — but there is some curious broadening, considering that the name of the game is competition. Taxes on computer software and floral business equipment are one thing, but adding a tax on the necessary supplies of the jewelry industry and greatly expanding the net that would catch commercial fishing boats in the sales-tax Web from 5-ton vessels to 50-ton vessels seems a bit like circling around ailing bison.
Why can't we just cut the sales tax, period? Maybe when our state economy has rocketed to the forefront of the nation we could think about broadening it, but desperate times call for bolder measures.
Correction on Tiverton Contract
In attempting to get a handle on the recently approved AFSCME labor contract in Tiverton on a Saturday morning, I made a data entry error that resulted in a too-dramatically opposing result from the town administrator. He inadvertently jumbled the starting points for his increase/decrease calculations, leading to a stated savings of $117,065, and I inadvertently typed $60 into my calculator rather than $60,000 for overtime savings, leading me to declare a cost increase of $114,647.
The actual result was apparent in my second look at the contract, for which I brought the administrators numbers into an Excel spreadsheet. Unfortunately, time constraints led me not to make the connection. The upshot is that, with more-or-less even savings of $5,233, the town traded some staff restructuring related to minimum manning for the salary and healthcare-cost increases.
I regret the error and will make corrections and notes where appropriate. In the broader debate, however, my view doesn't change. The town should be looking for substantial savings, given the current environment, and this contract is ultimately more expensive than the prior one.
March 15, 2009
Susan Estrich on Why Madoff "Pled Out"
It wasn't to escape jail time.
Madoff, who is 70, is looking at a life sentence for his crimes. He had to know that coming into the courthouse to plead guilty.* * *
By pleading guilty, Madoff cut his losses, not in the way most defendants do, by getting rid of a couple of counts or getting the charges reduced or getting a deal for a lower sentence based on cooperation, but in the only way he could: He limited the time he will spend in the spotlight, limited the opportunity for public outcry, deprived his victims of a daily ritual for the weeks or months the trial might have lasted. We who might have liked to see him squirm, to watch his face as the mountains of lies were laid bare, will be deprived of that opportunity. We will not see him suffer.
How Many Chances Should a Racist Get?
In the view of a lot of people, one would be the limit. Mayor Susan Menard appears to be more forgiving.
The civil lawsuit filed in 2000 by Bennie Koffa outlines the treatment to which he was subjected by certain employees of the Woonsocket Highway Department including, notably, Robert Harnois. It came to light last week that Mr. Harnois, now Superintendent of that department, is the subject of a second, similar complaint by certain current highway department employees. The behavior described in the 2000 lawsuit, directed solely at Mr. Koffa as the only black person in the department, was disgusting and brutish.
Mayor Menard, who last year promoted Mr. Harnois to Superintendent of the Woonsocket Highway Department, has stated that she did not and does not believe the allegations in Mr. Koffa's lawsuit. The frequency, duration and number of witnesses - daily/over a year/many - of the verbal abuse considerably detracts from the credibility of her assertion.
Or, if we were to take her at her word, we would need to ask a couple of questions. In her capacity as mayor, how many other meritless lawsuits did she settle for six figures on behalf of the taxpayers of Woonsocket (and of the state)? How often in her capacity as mayor has she settled lawsuits sight unseen, without reviewing the substance of the case?
It is inexplicable that the mayor would promote a person who had been the subject not only of such accusations but of a taxpayer funded settlement involving such accusations. In doing so, she has exposed the city to a considerable financial liability. More importantly, she has condoned such rancid behavior.
Desirable Transportation and the Road There
I'll admit that I'm generally in agreement with benjones on transportation:
In Rhode Island, we'll never be able to retool our local enonomy to produce the vehicles people are driving today, but we could use our small size and largely non-existent manufacturing industry to our advantage.We can design a transportation supply chain from scratch that gives us choices that make sense for our lives, and removes us from the mythology that we can have economic prosperity by using up a finite resource.
A thorough reworking of public transportation wouldn't affect my daily commute (except to the extent that it reduces traffic), given the fact that my job requires me to have a workshop's worth of tools at ready access on a mobile basis, but given the nature of my second job (or primary hobby) at Anchor Rising, I'm certainly in a position to appreciate a change in opportunities. No matter the job to which I'm commuting, I would love access to public transportation, even if it were to add to my actual commute time. With a netbook mini-laptop and high-speed, mobile-based Internet access, it would hardly be like "commuting" at all; I'd gain back most of the hour and a half that I spend controlling my vehicle each day for more productive and enjoyable tasks.
The problem, often the case with initiatives of a leftish bent, is that the issue becomes a vehicle for a broader agenda. It's not just an efficient public transportation system on which we're to focus, but an efficient public transportation system that runs on "environmentally friendly" energy sources and supplies jobs to union workers. The vision expands effortlessly from a rail system to a new paradigm that has commuters driving "cars like go carts." And the investment always requires additional government revenue, not a restructuring of government expenditures.
The question — and this could transform very quickly into a turgid discussion of government philosophy — is whether progressives could back public transportation as a principle that might not advance their other objectives, having enough faith in the rightness of their views that they think establishing principles will lead people down the path that they prefer. For example, even if it initially runs on that evil ol' oil, a public transportation system that extricates Rhode Islanders from their cars on a daily basis might save enough general wealth to make the clean-energy premium more palatable. And the increased ease might attract businesses and broaden opportunities, making residents more amenable to the employment higher-cost public-sector labor.
All along, investing in infrastructure has been one of the three pillars of my prescription for Rhode Island's economy. For the state to advance, however, we'll have to be careful not to bring too many of our bad habits and erroneous impulses along with us to the project.
Matt Labash Is Down on Facebook
In contrast to the mild reservations Justin expressed recently in a post, Weekly Standard columnist Matt Labash is fiercely anti-Facebook.
But there is one promise I've made to myself. And that is that no matter how long I live, no matter how much pressure is exerted, no matter how socially isolated I become, I will never, ever join Facebook, the omnipresent online social-networking site that like so many things that have menaced our country (the Unabomber, Love Story, David Gergen) came to us from Harvard but has now worked its insidious hooks into every crevice of society.For the five or six Amish shut-ins who may not yet have heard of this scourge (your tenacious ignorance is to be admired, and I'd immediately friend you if I was into Facebook and you had electricity), Facebook is an online community where colleagues, friends, long-lost acquaintances, friends of friends or long-lost acquaintances, and perfect strangers find and "friend" each other based on their real or perceived affinity. ...
A State of Unfreedom
I intend to spend a little more time perusing the report titled Freedom in the 50 States: An Index of Personal and Economic Freedom (PDF), put out by the George Mason University Mercatus Center, but Rhode Island's predictable rankings, among the 50 states, are notable without extensive commentary:
- Fiscal policy: 41
- Regulatory policy: 48
- Economic freedom: 42
- Personal freedom: 47
- Overall freedom: 48
Overall, only New Jersey and New York are less free than Rhode Island. And regarding overall freedom, it's not surprising that the scatter plot on page 21 shows a precipitous drop when the percentage of the vote going to the Democrat nominee for president (in 2004) exceeds 50%.
March 14, 2009
Pelting with Rose Petals: The EP Ed Assoc Ad About Mayor Larisa
For the record, if the RI Ethics Commission ever finds me "guilty" of pro bono helping someone get due process in a civil proceeding, I sincerely hope that the East Providence Education Association will take out several ads for me, too.
Snarky About Snark
Even though he pauses to make a snarky jab at local bloggers, I generally concur with Bob Kerr's aversion (in principle, at least) to snark:
Snark is so easy, like falling into a big, cushy pile of old blankets and tattered pillows. There is the comfort of knowing that you can wrap yourself in whatever high cause you choose without the bothersome test of reason or fairness. And it is all one-way."Of course, snark is just words," says Denby, "and if you look at it one piece at a time it seems of piddling importance. But it's annoying as hell, the most dreadful style going, and ultimately debilitating. A future America in which too many people sound mean and silly, like small yapping dogs tied to a post …"
There's a danger, it seems to me, that an anti-snark movement would knock down such rhetorical pillars as sarcasm and unavoidable reactions as scorn, but it bears a wary eye. Twittering — the short-attention-span, generation-z spawn of blogging — strikes me as a deadly vehicle for the delivery of snarkiness.
Maybe It's the Rhetoric That Makes the Stem-Cell Issue "Surreal"
The change in our nation's direction on embryonic stem-cell research would concern me a little less if it weren't expressed in such poorly conceived terms:
As important as the stem-cell policy change is "the paradigm shift in making sure that research in this country is based on sound science and not any kind of political ideology," [U.S. Rep. Jim] Langevin said.
It shouldn't take but a moment's thought to come up with an example wherein most Americans would agree that ideology (read: "morality") ought to trump even sound research. Placing in lab coats those cannibalistic fetishists about whom we periodically hear gives a caricature of the possibilities if, for example, we join the "right to die" movement with the "right to experiment" philosophy. As with war, we do well to place the broader society in ultimate command of the practitioners.
Mr. Langevin's fellow guest at the the VA Medical Center, Harvard Stem Cell Institute Executive Director Brock Reeve, perpetuates misconception — or at least the reportage makes that appear to be the case:
Stem cells are the precursor cells that can transform into any cell in the body. Embryonic stem cells are especially adept at this. Scientists hope that they can be used to replace nerves in a paralyzed person's spinal cord or insulin-producing cells in a diabetic's pancreas. But Reeve cautioned, "It's going to be a long time before scientists and doctors know how to control any cell," he said. Embryonic stem cells may cause tumors, may be rejected by the patient's body and may migrate to places they're not supposed to go.
In point of fact, scientists have already provided doctors with methods of treatment related to adult stem-cells. Indeed, I won't find it surprising should those successes begin to be treated as if they ought to be credited to the new freedom of science from ideology now that the supposedly historic moment has come and gone.
The Same-Sex Marriage Zeitgeist
I struck up an Internet friendship with artist and art reviewer Maureen Mullarkey back in the early days of blogging, begun with an initial contact concerning our agreement about same-sex marriage. That agreement has apparently plunged her into chilling circumstances:
Strange times we live in when it takes a ballot initiative to confirm the definition of marriage as the union of a man and a woman. Stranger still when endorsing that definition through the democratic process brings threats and reprisals.In November, the San Francisco Chronicle published the names and home addresses of everyone who donated money in support of California's Proposition 8 marriage initiative. All available information, plus the amount donated, was broadcast. My name is on that list.
Emails started coming. Heavy with epithets and ad hominems, most in the you-disgust-me vein. Several accused me, personally, of denying the sender his single chance at happiness after a life of unrelieved oppression and second-class citizenship. Some were anonymous but a sizable number were signed, an indication of confidence in collective clout that belied howls of victimhood. New York's Gay City News asked for an interview because I was "one of only four New Yorkers who contributed more than $500."
I ignored the request, trashed the emails, and forgot about them. But the West Coast bureau chief of the New York Daily News did not forget.
The ensuing experiences included finding two men waiting at her apartment to "interview" her one night, receiving promises of professional retribution, and the implicit intimidation that comes with having one's home address published with the tone of "make the bitch pay."
For some, it seems, marriage is not so much about love as about self-validation and an expression of power. Whatever proves true of the former, we ought not expect the latter to be tempered by victory.
March 13, 2009
Messieurs Almeida, Langley, Metts
... when you get a minute, in between hearings for this bill, you may want to glance over this article in yesterday's Valley Breeze.
City Council President Leo Fontaine and members of the City Council confirmed for The Valley Breeze this week they are investigating allegations against Highway Superintendent Robert “Bob” Harnois, following complaints from those under him that Harnois has been firing racist comments at minority employees.* * *
A person claiming to be a witness against Harnois in the case pending before the Commission for Human Rights, said Harnois’ arrogance “knows no end” when it comes to him keeping his position with the city.
“Yes I heard the racist comments,” said the witness, who said claims accusing him of using racial slurs are “100 percent true.”
“I absolutely, positively heard them,” said the source.
Three former and current highway employees, who did not wish to be named for fear of retaliation, backed the claims in the anonymous letter, saying that on a regular basis, Harnois calls the few minority employees in the department the racist term while they work, said the workers.
* * *
The letter accusing Harnois includes claims he is verbally abusive to workers of all races, excluding those in his “inner circle.”
But Mayor Menard had no inkling of such an attitude on Mr. Harnois' part when she promoted him a year ago to head of the Highway Department, did she? Actually,
According to city officials, Harnois was accused a decade ago as part of a $250,000 decision against Woonsocket after another black employee, Bennie Koffa, complained of the same treatment and won a judgment.
Inasmuch as some of the alleged verbal abuse occurred over the Highway Department's radio waves, the witness list for the Commission for Human Rights (and such other authorities as may hear this matter) may be comprised of the entire Highway Department.
As the World Moves On
In tone, more than words, James Lileks puts his finger on a strange sense in the air, particularly among some on the right:
I mention this for one reason: Tony West is the President's nominee to head the Justice Department's Civil Division. If you want to know how far we are past 9/11, there's your answer: John Walker Lindh's defense attorney is going to work for Justice. I'm not saying he wouldn't do a perfectly competent job.It just seems like one of those things that might have stuck out, once upon a time.
There are competent, talented people throughout the country. Why this one? Are we losing sight of something that we ought to be preserving?
Life on the Plantation
Rhode Island and Providence Plantations was established by Royal Charter in 1663:
Because titles to these lands rested only on Indian deeds, neighboring colonies began to covet them. To meet this threat, Roger Williams journeyed to England and secured a parliamentary patent in March 1643-44 uniting the four towns into a single colony and confirming his fellow settlers' land claims. This legislative document served adequately as the basic law until the Stuart Restoration of 1660 made it wise to seek a royal charter.To this day, the official name of the state is still the state of "Rhode Island and Providence Plantations", though the last half of the name has been forgotten by just about everyone for a very long time. Basically, the full name has been relegated to nothing but an interesting piece of trivia: the littlest U.S. state also has the longest name. So no one really thinks much about it. Well, except a few who want to officially drop the "Plantations."Dr. John Clarke was commissioned to secure a document from the new king, Charles II, that would both be consistent with the religious principles upon which the tiny colony was founded and also safeguard Rhode Island lands from encroachment by speculators and greedy neighbors. He succeeded admirably. The royal charter of 1663 guaranteed complete religious liberty, established a self-governing colony with local autonomy, and strengthened Rhode Island's territorial claims. It was the most liberal charter to be issued by the mother country during the entire colonial era, a fact that enabled it to serve as Rhode Island's basic law until May 1843.
Their history is correct. Newport was a major slave port and Charles Rappleye's Sons of Providence is a fine, recent work that covers both this and the role that the Brown family (founders of Brown University) had in the slave trade. In fact, Brown University has undergone a very public self-examination and has taken various steps to account for the fact that their foundations were built upon slavery. It is also true that some of the farms in the "South County" region of the state did operate with slave labor.A group of Smith Hill legislators, along with members of the black community, believe it’s time for a name change that does not conjure up images of the slave trade.
“That we still have the word ‘plantation’ in our name is really a grave injustice and an insult to people in our community,” said Sen. Harold M. Metts, D-Providence.
He and other legislators, reviving a decades-old proposal, have introduced companion bills in the House and Senate to place a question on the next election ballot that asks voters whether they want to change the state’s official name to “Rhode Island.”
In years past the proposal has gone nowhere, with critics saying that the state’s name –– however flawed –– is part of the fabric of the Ocean State’s history.
But supporters say otherwise.
“We’re part of history and we’re changing that history and we don’t want to see that name anymore,” said fellow sponsor Rep. Joseph Almeida, D-Providence, at a news conference yesterday.
The proposal is much bigger than a name change, they said. It’s about making the state aware of its ties to slavery and moving forward, free of that burden.
“If we look at history, history is written for us to avoid the past and to move on,” said Dennis Langley, executive director of the Urban League of Rhode Island.
In Narragansett County, conditions favored large-scale farming, and here more than anywhere else in the North a system began to emerge that looked like the Southern plantation colonies. In parts of "South Country" (as Narragansett also was called), one-third of the population was black work force by the mid-18th century. That's comparable to the proportion of slaves in the Old South states in 1820. Narragansett planters used their slaves both as laborers and domestic servants. William Robinson owned an estate that was more than four miles long and two miles wide, and he kept about 40 slaves there. Robert Hazard of South Kingstown owned 12,000 acres and had 24 slave women just to work in his dairy. The Stantons of Narragansett, who were among the province's leading landowners, had at least 40 slaves.
In keeping with the usual pattern, a higher percentage of blacks meant a more strict control mechanism. South Kingstown had perhaps the harshest local slave control laws in New England. After 1718, for instance, if any black slave was caught in the cottage of a free black person, both were whipped. After 1750, anyone who sold so much as a cup of hard cider to a black slave faced a crushing fine of £30.
But the point is that the "Plantations" referred to in the original charter was a common appellation for "a new settlement or colony". Obviously, the meaning of the word became associated with chattel slavery in the South and carries a negative connotation today. I completely understand that. But by pushing to remove "Providence Plantations" from the official name, by "changing that history", proponents are being anachronistic in their application of the term.
They are also being impractical in these times. Like other states, Rhode Island is facing some serious fiscal difficulties--there are plenty of things that our politicians should be worried about besides a feel-good measure of limited appeal and utility. In addition, there are costs incurred by such a change (there are many plaques, stationary, etc. that contain the full name, which would have to be changed).
One attractive argument for dropping the name is because it is so little-used and unknown. So what's the big deal, right? Well, there is the argument that this would be just the tip of the iceberg (ah yes, the "slippery slope." I know, I know...)
But allow me to indulge...What about the City of Providence. I think many people would associate the word "Providence" with religion and one of the definitions of "Providence" is "A manifestation of the care and superintendence which God exercises over his creatures; an event ordained by divine direction." The City of Providence is an official government entity. Should a government have a name that is so overtly religious? Or is that a history that needs to be changed, too?
Curious Developments in Pension Politics
For whatever it's worth, the "study commission" looking at pensions for the Rhode Island House approved a plan to increase the minimum retirement age to 65, and although it didn't vote to eliminate cost of living adjustments (COLAs), it did suggest tying them to inflation data.
The curious result came during the vote to apply changes to current employees who are vested, but not yet eligible to retire (emphasis added):
The union leaders, predictably, were in the minority on each vote taken last night, arguing throughout that no one who has put in the minimum 10 years of service that entitles them to a pension — also known as vesting — should be touched by any mid-career changes in the retirement package they have for years been led to expect. On many of the votes, they were joined by Rep. John Loughlin, a Tiverton Republican who has signaled some interest in running for Rhode Island Democrat Patrick Kennedy’s 1st District Congressional seat.
What to make of a panel on which Rep. Timothy Williamson (D-West Warwick) and Rep. Timothy Williamson (D-West Warwick) vote for a stronger line than Mr. Loughlin?
March 12, 2009
Council on Women and Girls
As the older brother of two sisters, the husband of a fine lady who is one of four daughters and the father of two girls...my ears perked up when I heard this.
President Barack Obama invoked the travails of women in his family as he signed an executive order on Wednesday establishing a new interagency panel devoted to the concerns of women and girls.Huh. And so we have the White House Council on Women and Girls. OK. As reported by Lisa Belkin, they're going to try to address the problems faced with today's working mothers and how “the challenges confronted by women and girls to ensure that all Cabinet and Cabinet-level agencies consider how their policies and programs impact women and families.” As Belkin notes, though, "too many of the problems women and girls have in the world stem from the fact that the problems are considered 'their' problems — 'women’s problems' — rather than problems that both genders share." She lists unequal pay, maternity leave, childcare and work/life balance as issues of concern to families. OK. That's a valid point.“I sign this order not just as a president, but as a son, as a grandson, a husband and a father,” Obama told a mostly female audience of activists and lawmakers in the East Room of the White House. “I saw my grandmother work her way up to become one of the first women bank vice presidents in the state of Hawaii, but I also saw how she hit a glass ceiling—how men no more qualified than she was kept moving up the corporate ladder ahead of her.”
But I could've sworn I've been reading about how girls have made some major strides and have surpassed boys in college attendance, for instance. Like this from 2003:
Thirty years after the passage of equal opportunity laws, girls are graduating from high school and college and going into professions and businesses in record numbers.And 2005:Now, it's the boys who could use a little help in school, where they're falling behind their female counterparts.
And if you think it's just boys from the inner cities, think again. It's happening in all segments of society, in all 50 states. That's why more and more educators are calling for a new national effort to put boys on an equal footing with their sisters.
Not only do national statistics forecast a continued decline in the percentage of males on college campuses, but the drops are seen in all races, income groups and fields of study, says policy analyst Thomas Mortenson, publisher of the influential Postsecondary Education Opportunity newsletter in Oskaloosa, Iowa. Since 1995, he has been tracking — and sounding the alarm about — the dwindling presence of men in colleges.And 2007:
By 2020, some studies say that 156 women will earn B.A.s for each 100 men. At the same time, manufacturing, the traditional fallback option for less-educated men, is declining rapidly in the U.S. Aside from the predictable jokes about how easy it is for male college students to find dates, this means that women may very well pick up a good deal of men's professional and academic slack in coming decades.And last year:
An analysis of standardized test scores from more than 7.2 million students in grades 2 through 11 found no difference in math scores for girls and boys, contradicting the pervasive belief that most women aren't hard-wired for careers in science and technology.Maybe the Obama outlook on gender equity is akin to his economic policy: stuck in the '70's. But whatever. My question is, given the clear trends here, will there be a Council on Boys?The study also undermined the assumption -- infamously espoused by former Harvard University President Lawrence H. Summers in 2005 -- that boys are more likely than girls to be math geniuses. Girls scored in the top 5% almost as often as boys, the data showed.
Twenty Percent of Massachusetts Stimulus Dollars Directed to Honor One Family
Who would that be? You guessed it.
H/T Howie Carr. From the American Thinker:
According to an AP article , Massachusetts is receiving 126 million stimulus dollars; of that amount more than 1 out of 5 of those dollars "is going to help preserve the legacy of the Kennedys."1) $5.8 million to plan and design the new Senator Edward M. Kennnedy (D-MA) Institute for the Senate plus, perhaps, an endowment for said institute. (Quietly insert your own free Senator Edward Kennedy Senatorial Institute joke here.)
2) $22 million for expanding the John F. Kennedy Presidential Library and Museum.
3) $5 million for a downtown Boston park; a new gateway to Boston Harbor Island on the Rose Kennedy Greenway.
A caller to Howie correctly pointed out that the honorable thing for the Kennedy family to do would be to decline these projects and suggest that the funds be directed to more urgent and practical projects.
Mayoral Academies Going Forward
Amidst all of the bad news, there are some encouraging things happening in our state. As reported in the ProJo, Cumberland Mayor Dan McKee recently announced that he is going ahead with his Mayoral Academy.
McKee said if his proposal wins approval by the Rhode Island Department of Education and secures $700,000 in state financing, he wants to open an elementary school this September in his town’s Valley Falls section, in a former parochial school building.Several other mayor's were with McKee. For his part, Warwick's Mayor Scott Avedisian told the Warwick Beacon that he thinks a Mayoral Academy may be feasible in his city:The school would serve 80 kindergarten and first-grade students from Central Falls, Cumberland, Lincoln and Pawtucket. A middle school would open, starting with a sixth-grade class, in fall 2010. Eventually, the schools would cover K-12.
If there is a delay with state funding or approval, McKee said he plans for both schools to open in 2010. He hopes more regional mayoral academies will open, mixing urban and suburban students.
A 12-member board, a mix of mayors, community leaders and education figures chaired by McKee, would oversee the schools. But national charter school operators would run and staff the schools. Democracy Prep, which runs a middle school in Harlem, has already applied to the Department of Education to run the first mayoral academy.
In addition, McKee said his group has received financial support from nonprofit organizations and private donors to help pay start-up costs, including a $2-million commitment from the Raza Development Fund of Arizona to purchase a building.
Mayor Scott Avedisian said he supports a proposal to use the former Potowomut School for a Mayoral Academy at a press conference to announce the formation of the Rhode Island Mayoral Academies (RIMA) board yesterday.“As a mayor, I have a responsibility to ensure our children receive a quality education which will allow them to compete in the global marketplace,” Avedisian said in a press release. “Mayoral Academies represent our firm commitment to providing the best education possible for the students of our cities and towns.”
Mayoral Academies are a form of charter schools created last year. The brainchild of Cumberland Mayor Daniel McKee, the schools won legislative approval last year despite steep opposition from powerful teacher unions.
Yesterday Avedisian saluted McKee for his hard work and effort to make the schools a reality.
“We’ve talked about governance reforms for years and years and they’ve never gone anywhere. This is a real opportunity to see that governance reform takes place,” said Avedisian.
Avedisian talked about how Warwick spends 70 cents of every tax dollar on schools, which the City Council has no control over. A Mayoral Academy, he pointed out, would be controlled completely by the city side of government.
The teachers in the schools wouldn’t be subject to the same mandate as the regular public school system, and wouldn’t be teachers’ union members.
Tiverton Would Rather Fire Employees than Keep Their Compensation in Check
In an article that doesn't appear to be online, Tom Killin Dalglish of the Sakonnet Times perpetuates the analytical error that I've been describing:
Councilors were told that the contract will cost $117,000 less than the contract it replaces, and ultimately it was this feature that motivated the council members to end the debate and vote to approve the deal.
According to my analysis, the contract will cost only $5,233* less than three additional years of the final year of the last contract. Since that year was undoubtedly the most expensive of the three that it covered, the number is probably an overall increase in cost.
More interesting, in Tom's article, is another consideration that several council members apparently found persuasive:
But the ensuing discussion molified [Jay Lambert's] concerns. "There's no promise in this contract that guarantees a level of employment," said Council President Donald Bollin."It's not a no-layoff contract," said Town Solicitor Andrew Teitz.
"As long as we have Mr. Teitz's confirmation that there may be layoffs and fuloughs," Mr. Lambert said, he was satisfied, and he subsequently withdrew his motion to postpone council consideration of the contract.
Well that's just great. The town council bought a too-expensive contract in the midst of an unpredictable economic downturn at the state and national levels on the grounds that they can always increase unemployment and decrease town services in the future. As I've said, if this sort of thinking dominates the three larger contracts that the town must negotiate in the coming months, we're in a great deal of trouble.
* * My initial number resulted from a data entry error as explained here.
Taxes Affect Decision Making? Really?
We are constantly told by some advocates that there is no "proof" that higher corporate taxes have an impact on where a business chooses to set up shop. Right.
The tidy towns and mountain vistas of Switzerland are an unlikely setting for an oil boom.Actually, the parallels between the small country of Switzerland and little Rhody are intriguing. If only we could get our act together.Yet a wave of energy companies has in the last few months announced plans to move to Switzerland -- mainly for its appeal as a low-tax corporate domicile that looks relatively likely to stay out of reach of Barack Obama's tax-seeking administration.
Companies say Switzerland's attractiveness as a corporate location goes beyond tax to include easy and efficient transport, a high quality of life and well-trained staff.Yes, it is more than just an attractive tax structure that is required. One would think that efficient transportation and a solid infrastructure would be more easily achieved in a small state like ours. Switzerland has the Alps and, as Dan Yorke often says, a lot of what makes RI so attractive is "water." As for education, we have a lot of resources, but may be slipping. Basically, Rhode Island has a lot of untapped potential, but we all know that. It will remain untapped until and unless our political class gets their priorities in order. Or until Rhode Islanders finally hold them responsible. The track record isn't encouraging.
Corderre Opens the Socialist Umbrella Wide on Healthcare
In a healthy political state, a legislator would be scared for her political life to propose such policies in a high tax state during a painful downturn:
Legislation introduced by Representative Coderre, (2009-H5519), would extend the reach of the RIte Track program, and establish a new "All Kids Health Insurance Program" to provide access to health insurance for an additional 1,000 to 2,000 or more children in the state.The bill, which is before the House Committee on Finance, would extend RIte Care eligibility to children from families earning 300 percent of the federal poverty level, an increase from the current 250 percent. There are approximately 1,900 uninsured children in this income bracket, and the legislation would enable these children to enroll in RIte Care for an annual monthly premium of $135.
The bill also implements a buy-in program for children living in families with incomes over 300 percent FPL. Families taking advantage of the buy-in option would pay the full cost of the premium (which would include administrative and medical costs), to be determined by the Department of Human Services. It is estimated that 4,900 children in Rhode Island live in families with incomes above 300 percent FPL who don't have health insurance.
The legislation also reinstates coverage for immigrant children under age 10 who are lawful permanent residents in Rhode Island, restoring eligibility for about 1,100 legal permanent resident children who lost coverage during under last year's state budget, and including an anticipated 200 children per year in the future.
Three times the poverty level would be $52,800 for a family of three, $63,600 for a family of four, and $74,400 for a family of five. I've got the personal perspective that this legislation would bring my family within the coverage umbrella, and I'll admit that the only reason I'm struggling is a burden of debt, and my preferred solution to solving that problem would be to increase the opportunities for advancement available to my wife and me. Growing government would do the opposite, as the government seeks somebody to pay the expanding bill.
If we really want universal healthcare coverage, the solution is to decouple insurance from employment, chip away at the growing body of mandates and regulations, and make base-line coverage mandatory. Solutions like Coderre's will push us all closer to the pit.
In the Dark Land, the Man with a Flashlight Is King
Or maybe he's an easy target.
Matt and I had a few laughs (of the "or we'd cry" variety on last night's Matt Allen show. Why doesn't anybody in power see what needs to be done, and what's the appropriate attitude to have in response? Stream by clicking here, or download it.
March 11, 2009
Budget Developments, Good and Bad
I stand by prior criticisms of certain practices and (non)policies of Mayor Susan Menard. Nevertheless, she, along with other mayors and councils around the state grappling with a bad budget situation, has my sympathy.
Further, she and the Woonsocket City Council are to be applauded if this questionable practice is discontinued, though some of us continue to wonder why it was ever implemented, in Woonsocket and elsewhere.
Lambert said the city also intends to address the fatigue issue by abandoning a longstanding fire department policy of having an engine accompany every rescue run. He said the move would eliminate perhaps 7,000 engine runs per year, further easing the strain on manpower.
This idea, however, seems unnecessary, unenforceable and smacks of vindictiveness, even with the stated disclaimer.
Amid concerns that recent layoffs on the Woonsocket Fire Department will increase forced overtime and on-the-job fatigue, city officials disclosed Tuesday that they intend to prohibit firefighters from holding outside employment beginning in April.“From our perspective we are just trying to relieve the stress on the overworked firefighters,” said city attorney Chris Lambert. “We don’t want to add to that.”
The Substance in the Style on Stem Cells
I remember when President Bush made his announcement about the ban on federal financing of embryonic stem-cell research. He held an evening address, at his desk, and took the time to explain some of the science, present the opposing arguments as he saw them, and explain his decision. You can think what you like about the man or his decision, but that's a stark contrast from President Obama's cheering-crowd press conference, yielding photographs of him leaning off the stage to lay hands on the paralyzed Representative Jim Langevin.
The difference extends to substance. Bush offered an actual compromise position (as much as those who opposed him might have disliked it): He increased (I believe) funding of adult-stem-cell research and permitted funding of research on stem cells that had already been removed from embryos. From Obama, we get promises:
Mr. Obama pledged that his administration will write strict guidelines for research on stem cells taken from embryos. "And we will ensure that our government never opens the door to the use of cloning for human reproduction,'" calling the practice "dangerous and profoundly wrong."
Why not have those guidelines ready for presentation at Monday's announcement? Why not actually put into place anti-cloning policy at the same time that he opened the door for federal funds for the destruction of embryos?
The answer, I suppose, depends on how cynical one is.
Stasis Locked In
I'm hearing that the Tiverton Town Council ratified the contract with the AFSCME municipal workers. That's one out of four contracts in the town becoming available for negotiation this year that is now off the table. One out of four contracts that will now represent a "locked in," unchangeable portion of the budget over the next three years, no matter what the economy does and no matter what happens in the lives of Tiverton residents.
One talking point that council members are using in justifying their votes to constituents is that the contract incorporated a couple of policy changes, notably minimum manning, that made increases in other areas a reasonable exchange. But first of all, the minimum manning of town workers hardly represents the burden that the same policy creates with the fire and police workforces. And second of all, these "principles" may be written out of contracts just as easily as they're written in. This contract, of itself, is more expensive than the status quo. Whether non-dollar policies that kept the money flowing to the union members will hold their strength next time around — probably in an improved economy — we'll have to wait and see.
If the other three contracts receive similar treatment, we may be in for an even more painful economic depression.
Governor Carcieri Defends Budget
Governor Carcieri was on WPRO's John DePetro show to defend his budget (primarily against the ProJo coverage of it). The ProJo reported that there was a 10% increase in this budget over last, but the Governor explained that the increase is all federal money and most of it is attributable to an increase in unemployment benefits. Further, the Governor explained that this budget is less than that in 2008. In short, STATE revenue expenditures are down. (The ProJo stated later in their story piece that state expenditures did go down $197 million).
As to the assertion that he took the easy road by relying on stimulus money, the Governor claimed there are structural changes in budget that need to be made (reforming government, tax cuts) so the state will be well-positioned once the stimulus runs out. The point of the stimulus is to create a bridge to the future for the state and help balance the budget in severe times. It is not permanent, but it buys the state time to make structural changes.
In response to criticism from Rep. Steven Constantino that he didn't make hard decisions, Governor Carcieri pointed out that the legislature needs to move on his 2009 budget, which includes such reform as removing State-level mandates and includes statewide health care reform. Instead, they're doing nothing. (DePetro pointed out that the Governor's proposal to bring an end to 3% COLA for retirees and implementing retirement-at-59 are hard decisions).
Additionally, Constantino alluded to "significant changes" and the Governor expects the House to revise his budget. But if a major revision includes a tax increase, he's not going to stand for that and urges Rhode Islanders to be ready.
According to the Governor, the bottom line is that we need to run our state and local government more efficiently. We need competitive taxes and are generating more than enough revenue to offset tax cuts. Finally, the state needs to be competitive and attractive to the private sector so we can "grow the pie" and keep workers, businesses and retirees in the state.
ADDENDUM: The Governor also took issue with comments made by Rep. Robert Watson (R -East Greenwich) in the ProJo story:
I am disappointed that this budget apparently is reliant upon raising taxes in order to balance a budget. I will not support balancing the budget on the backs of those men and women that get out of bed and go to work everyday for a living.Governor Carcieri claims he doesn't know what Watson was talking about. Rep. Watson called into DePetro's show and stated that the Governor should know what he's talking about. That while he has supported the Governor--and continues to do so in many ways--he can't support the Governor's taxation plan because it hurts the middle class with such things as raising the cigarette tax and raising fees on citizens. Most important (as Justin noted), is the new income tax structure that helps the very bottom and top but hurts the middle class by taking itemized deductions away and actually raises the income tax rate for the middle tiers.
The Budget That Lost Its Way
Given that his elective clock is rapidly running out and voters' inability to see the danger of their usual practices (as made clear by the latest election results), perhaps the most important thing that Governor Carcieri could have done with his budget proposal would have been to shine a stark light on a better direction. The General Assembly and other entrenched interests would beat him up no matter what. They'll pick and choose his proposals and substitute their own. As I've been saying, the governor should put forward a proposal and disavow any modifications to it as the property of legislators.
Instead, Carcieri enabled the Providence Journal's news-section editorialists to begin their coverage of the budget proposal thus:
It was supposed to be among the most difficult decisions in his political career. Facing a crippled state economy, Governor Carcieri was charged with crafting a plan to fill what may be the largest budget deficit in state history.
He gave Kate Brewster room to make a reasonable free-market point:
Kate Brewster, executive director of the Poverty Institute at the Rhode Island College School of Social Work, which analyzes tax and budget policies on behalf of low-income people, opposes Carcieri's plan."Reducing corporate income taxes without closing corporate tax loopholes is double jeopardy for small businesses in Rhode Island," she said.
Small businesses "will find themselves competing on an even more un-level playing field" than they do now, as they watch big businesses obtain tax relief, she said.
Some businesses would benefit through the eventual elimination of the corporate income tax, others would not. Of about 50,600 companies that do business in Rhode Island, about 3,500 pay the state's 9 percent corporate income tax, according to state figures based on the 2006 tax year.
The majority of companies — about 47,000 — do not, because they are organized as pass-through entities. Thus, their income is typically not taxed at the entity level, but instead passes through to the business's owners, who pay taxes on it on their individual Rhode Island returns.
He proposes to raise taxes on the group, what I've been calling "the productive class," that's actually fleeing the state, while increasing incentive for the push-me-pull-me groups at the high and low ends to immigrate and to stay, thus enhancing the mentality that we must take from the rich to give to the poor (even as we take less from the rich):
Meanwhile, on taxes, Carcieri is proposing a swath of tax cuts, including an expansion of the earned-income tax credit for the poor, a five-year phase-out of the 9 percent corporate income tax, and an increase in the estate tax exemption to $1 million.While most will see a tax cut, others will not.
An estimated 110,179 filers will each pay an average of $1,261 more in income taxes, according to Carcieri's tax study commission. The vast majority of them are individuals and couples making less than $75,000 annually, as commonly used deductions for mortgage interest and local property tax payments are replaced with a new standard deduction.
We need fundamental change that will decrease the size of government (in large part by changing the state's various incentive structures) and increase the opportunities for individuals and businesses. I'm sure the details of Governor Carcieri's plan will flow forward for public scrutiny over the coming weeks, and I'm sure the General Assembly will find ways to make the budget worse, but the bold statement that we needed has not been made. Consequently, we'll continue to drift farther out to sea.
March 10, 2009
Hillary Campaign to Cicilline: Just Raise Taxes!
[This post originally appeared on February 22, 2008. I've bumped it up so that commenter Jayzeeh can judge first hand my opinion of David Cicilline and firefighters.]
Because the Providence firefighters had promised to picket Senator Hillary Clinton's Rhode Island event this weekend over their lack of a contract with the city, her campaign has asked Mayor David Cicilline not to attend the event.
But before dropping that bomb on His Honor, Hillary's campaign suggested as an alternative that the Mayor of the capital city of the fourth highest taxed state simply give in to the firefighters' demands.
My own view of the "dispute" between the Mayor and Local 799 is that it amounts to play-acting by David Cicilline, who believes that this stance will confer upon him the title "Champion of the Taxpayer". He is mistaken. It is clear that Providence needs to make some adjustments to its budget. But such adjustments must be across the board. The Mayor has, instead, selected a very short list of line items to adjust. This is not only ineffectual but unfair. Further, if, as the Mayor contends, there is room to negotiate within the firefighters' contract (which there may well be), then there is also room for negotiation in a city contract ten times larger - the teachers' contract. The Mayor has not seen fit to look for such flexibility in the latter case, only in the former, which involves a far smaller block of municipal employees and, accordingly, a much smaller block of potential political supporters. For these reasons, it is difficult to be impressed by his production "starring" the firefighters.
At the same time, the philosophy espoused by Senator Clinton's campaign - "just cave" - in addition to not being very sensitive to taxpayers, is the very one which has led to Rhode Island being the fourth highest taxed state in the country. Roland Benjamin has an excellent post today about the extravagant proposals Senator Obama has made while campaigning. Following upon the advice by the Hillary campaign to the Mayor of Providence, it appears that these two Presidential candidates are in a race to see who can spend down the taxpayer's wallet the fastest, one with expensive proposals and the other with an irresponsible approach to the negotiation of government contracts.
Mayor David Cicilline Declares for Re-election
... in the following press release issued at 3:08 pm today.
Dear Friend,You have been an active supporter of the important work we have taken on together, and I want you to be among the first to know about an important decision I have reached. In these particularly difficult economic times, I am more certain than ever that it is the right one. Today I am declaring my candidacy for reelection as Mayor of our great city.
We have achieved a great deal in the past six years -- maybe more than many of us expected -- but the job is not done and we are in the midst of a serious financial crisis. It is not a time to change focus. I hope you will take a few minutes to review the statement I recorded about my decision by clicking the link or image below. As always, thank you for your devotion to our important work on behalf of Providence.
Experience with the Darker Side of Employment
You may have noticed that my posting has been sporadic, of late. I've been going through the sort of experience that all government meddlers ought to have, and it's proven not only time consuming, but apt to scuttle deeper thoughts.
I read, somewhere, that new regulations are set to take effect that will help the unemployed to afford COBRA health insurance. To now, the way it has worked has been that laid-off employees could keep their health insurance, but they've had to pay their entire premiums (plus an administrative fee). The new (temporary) system will leave them paying 35%, with the employer covering 65%, which he will get back as a tax credit. In other words, it doesn't cost the employer, but he has to front the money for a year (during a down economy).
Well, let me tell you that a certain type of employer, already reluctant to lay people off for unemployment insurance reasons, now has even more incentive to get employees to quit than was previously the case. There's a subjective line at which an employer's behavior amounts to "constructive discharge" — meaning that no reasonable person could be expected to endure the work environment — but that's a hefty gamble when unemployment insurance and continued healthcare are on the line.
GA Democrats Distracting from Their Own Inaction
An article from yesterday illustrates, first, how much easier it is (politically) to respond to budget proposals than to make them, second, the method by which the Democrats leverage a low-power Republican governor to grandstand, and third, the desire that the General Assembly has to distract from the fact that it is doing next to nothing to resolve budget problems in the current fiscal year:
Key legislative leaders have soured on Governor Carcieri's recommendation that they raid the state's rainy-day fund to balance the budget, calling it an "irresponsible plan that will put the state at tremendous risk."In a sharply worded letter to Carcieri late Friday, House Finance Committee Chairman Steven M. Costantino and Daniel DaPonte, chairman of the Senate Finance Committee, said they will recommend that the General Assembly not use the reserve money to close out a lingering $37.4-million deficit from fiscal 2008 budget. Doing so, they say, could leave the state with inadequate cash reserves amid declining revenues.
"By taking from that fund and not paying it back, you put the state at serious, serious risk," Costantino said in an interview last night.
Look. I'd certainly prefer budgets that cut back on actual spending and shrink the heavy hand of government, in this state, but vague promises to "find a way to make up the $37.4 million" are about as valuable as dust in an oxygen tent. Without going back and counting the days, I'd speculate that — with the state spending more than $1 million per day that it does not have — the General Assembly's lethargy in resolving this year's deficit would already have achieved that dollar amount.
March 9, 2009
Apparently Higher Spending Is "Savings" in Tiverton
Unfortunately, time-critical tasks kept me from tonight's Tiverton Town Council meeting, at which the council will (or won't) ratify the latest AFSCME union contract. However, I did take a moment to rereview a document that the town council posted online titled "Contract Negotiations Summary."
That document shows a negative "net change" for each year of the contract and proclaims "total savings" of $117,065. Based on my inability to match the numbers, I emailed Town Administrator James Goncalo for the formula, and as I suspected, the town derives that dollar amount by assuming increases in salaries and other costs and counting some mitigating changes as savings. Basically, one totals the "wages," "health increase," and "co-pay" numbers for each year, finds the difference between one year and the year before, and then adds and subtracts the new expenditures and savings items.
Now, I don't believe that those who put together this spreadsheet are being deliberately dishonest, but I'm reasonably sure that they have made a conceptual mistake that conveniently embellishes their "savings." Simply put, the various line items are calculated from different starting points. For a measure of "net change," the wages, health increase, and copay items are calculated from the prior year,but everything else is calculated from the last year of the prior contract (2007-2008).
Thus, for 2010-2011, aggregate wages increase to $927,367 from $904,759, but estimated overtime savings don't actually increase an additional $60,000. They increase $60,000 compared with 2007-2008 rates. For the wage amounts to be comparable, they would have to be listed as the actual dollar-amount increase from 2007-2008 — or, $8,654 for 2008-2009, $39,375 for 2009-2010, and $61,983 for 2010-2011. Alternately, one could calculate all numbers as a change from the previous year. Recalculated in these ways, the "net change" amounts would render as follows (adjusting for a $10 error in the original calculations for the final year), with savings denoted as negative numbers:
| Town Council Calculation |
Change from 2007-2008 |
Y-o-Y Change |
|
|---|---|---|---|
| 2008-2009 | -$12,249 | -$12,249 | -$12,249 |
| 2009-2010 | -$46,948 | -$16,870 | -$4,621 |
| 2010-2011 | -$57,858 | $23,886 | $40,756 |
| Total "savings" | -$117,055 | -$5,233 | $23,886 |
The most reasonable measure of this contract's impact is the total increase or decrease compared with a flat-lined continuation of the status quo, or $114,647 -$5,233,* and I hope the town council isn't in the process of ratifying the contract as I type. If it does pass, residents can expect to hear that "locked in" phrase repeatedly during future budget battles, and we will be entirely justified in making these specific councilors pay a political price for having done the locking in.
* My initial number resulted from a data entry error as explained here.
Taking Back Buy Backs
WPRI's Tim White has been looking into the practice of teacher healthcare buybacks in Rhode Island (with the television segment airing tonight at eleven):
After combing teacher contracts for all 36 school districts, Target 12 crunched the numbers. Here are some of the most generous buy-back offers we found.-Newport teachers can get up to a $5,800 check to opt-out of coverage.
-West Warwick teachers can get $5,500 per family plan.
-Smithfield teachers can get a $4,500 check every year.
There's a perverse sense to the typical argument on behalf of buybacks:
"I think providing a modest cash incentive is a reasonable opportunity and unions give to the employees by providing these waiver payments," said James Parisi of the Rhode Island Federation of Teachers.Parisi believes that buy-backs are a good deal for towns.
The perversity comes in when one considers that the reason "incentive" comes into play is that the public gives its employees benefits so far out of proportion from what's available elsewhere that they are unlikely to find incentive in the fact that a spouse's healthcare is better.
(A secondary argument is that households containing two members in the same public-sector workplace could cost the employer more by each taking the healthcare, but that possibility ought to be obviated out of hand in policy, if not in law.)
Destroying Rhode Island No Joke
I knew Mark Binder in my previous life as a fiction writer (to which life, incidentally, I would very much like to one day return). I noticed that he surfaced as a Democrat Congressional candidate in 2004 but haven't seen anything from him until a letter appeared in last Friday's Providence Journal (but which is not currently online) Much of his fiction is outright humor or at least humorously tinged, but the disconcerting thing about his letter is that he doesn't appear to be kidding:
Rhode Island is one of the best places to live on the planet. We have wondrous and varied landscapes (and weather). We have fabulous people, amazing restaurants and a wealth of artists. It is a small and diverse, easily accessible state of mind.I think we should charge more to live here. This is a premium spot. Instead of cutting taxes for new businesses, we should raise them. People have to want to come to Rhode Island for more than the discount. Do you want to live in the Walmart State?
In the past, Rhode Island has used its healthy tax base to clean up the environment, to provide kindness to our neighbors in need, and to encourage the arts.
What's left after we strip the tax base?
Houses. Roads (maybe).
Let's pay more taxes and get better results.
Here's hoping that this is a satire to lampoon a too common mindset.
Governor's Tax Policy Workgroup Report
Governor Carcieri's Tax Policy Strategy Workgroup has released it's report (short version; long version). The ProJo has a story on the report and another on the impact that tax cuts will have on the budget deficit. They even have a poll asking, "Can Rhode Island afford to cut taxes now?" Funny, I don't recall any polls over the last decade or so asking, "Can Rhode Island afford to continually increase spending and grow government?" Anyway, here are the highlights of the committee's recommendations.
{All text taken directly from the summary report}
INDIVIDUAL TAXES
The starting point for the state’s personal income tax system be Federal Adjusted Gross Income (AGI) but that the number of modifications to Federal AGI that are made to determine Rhode Island Adjusted Gross Income be reduced.
The personal income tax system allow a state determined standard deduction and state determined personal and dependent exemptions, both indexed for inflation, as the only deductions from Rhode Island AGI in determining Rhode Island taxable income.
The personal income tax system consist of four taxable income brackets with a top marginal tax rate of 5.5 percent.
The personal income tax system tax income from capital gains at ordinary income tax rates regardless of how long an asset has been held before sale or what type of asset is being sold.
The personal income tax system allow only four tax credits: a refundable Earned Income Tax Credit, a Property Tax Relief Credit, a Lead Paint Abatement Credit, and Credit for Income Taxes Paid to Other States.
The Rhode Island estate tax exemption be raised immediately to $1.0 million and be gradually increased to match the federal estate tax exemption which in 2009 is $3.5 million.
Any expansion in the state’s sales tax base must be accompanied by a reduction in Rhode Island’s sales tax rate and a thorough assessment of the impact of such an expansion on small business.
BUSINESS TAXES
The Tax Policy Strategy Workgroup offers two options for consideration in the reform of the Business Corporation Tax. The first option would:
Eliminate the Business Corporation Tax and replace the current Franchise Tax system with a tiered system according to corporations’ net income.The second option would:
The restructuring of the Jobs Development Rate Reduction Tax Credit to make the eligible employee requirement be full-time employees with benefits and a minimum salary of at least 250 percent of the hourly RI minimum wage, currently $18.50.
Reduce the Business Corporation Tax rate to 8.0 percent, eliminate all but three tax credits, and maintain the current Franchise Tax system.
The restructuring of the tax appeals process by moving tax appeals to a tax calendar in Superior Court. Also, the requirement to pay the tax assessment in full prior to the appeal would be eliminated.
PROPERTY TAXES
Move toward standardization of tangible property tax rates, commercial and industrial property tax rates and maximum tangible property and commercial property tax rates in every municipality. Tangible property tax rates should be capped at no more than double residential property tax rates while commercial property tax rates should be capped at no more than 50.0 percent greater than owner-occupied residential property tax rates.
Move toward standardization of motor vehicle excise rates among municipalities while maintaining or expanding the current state $6,000 vehicle exemption. The standard rate would be $25 per thousand.
Limit personal property tax exemptions to a fixed 2.0 percent of the total municipal levy. These exemptions will also be limited by a statewide personal income and a residency qualifier.
Retain current statutory tax exempt standards, however, give tax assessors the authority to limit or eliminate the exemption based upon substantial and material unrelated business taxable income, as defined by the Internal Revenue Code, associated with any particular parcel owned by a tax exempt organization.
Guarantee state involvement in the assessment of certain types of property such as public utility or affordable housing property.
Develop statutory incentives that encourage municipalities to comply with state property tax policy.
Expedite the tax appeal dispute resolution process within municipalities before going to court and establish a state tax court or special calendar in Superior Court to hear commercial real estate and residential property appeals which exceed a certain threshold. Fine tune the appeal process in other ways to expedite the process.
Joblessness Freefall
We'd be remiss if we let this little item from the Projo's 7 to 7 blog (printed in Sunday's Business section) slip by:
Rhode Island's increase in unemployment was the worst in the nation last year, the U.S. Bureau of Labor Statistics announced today.The jobless rate in Rhode Island rose last year by 2.6 percentage points, reaching 9.4 percent by the end of December. The closest competitors in the category were Florida (up 2.1 percentage points) and Nevada (up 2 percentage points).
The global recession has led to increases in unemployment across the country. But overall, the average increase in joblessness in the U.S. last year was 1.2 percentage points, less then half the spike in Rhode Island.
Although, Kevin Donovan from Foster suggests that the unemployment figures that we've all been seeing may represent a severe undercount:
I'm curious as to how this is measured. My assumption has been that it is based on unemployment-benefit claims. Given that the State of Rhode Island is between six and eight weeks behind in processing unemployment claims, it would stand to reason that our state's unemployment numbers are being underreported.
There were 57,800 job seekers in January, and the state's unemployment agency is strugging to keep up with the 25,000 calls it receives each week. I'm not sure how these numbers all fit together, but if our latest unemployment rate was 10.3% on paper, what do you suppose it is in actuality?
Geoff Cook: Why I Need a Citizen's Voice
[This Engaged Citizen post by Geoff Cook originally appeared on October 16, 2008.
To Geoff and the five hundred other people becoming naturalized citizens this morning at Veterans Memorial Auditorium: Congratulations and welcome to America.]
In a strange twist of coincidence, Tuesday, October 14, I went to ICE in Providence to take my citizenship exam. The coincidence? Monday the 13th was the 18th anniversary of my arrival to work on a winter program at a “summer” camp. I would never have guessed then that I would still be here now!
So why am I becoming an American citizen? Let’s be honest: there really is nothing wrong with being English. The ladies certainly love the accent (will I lose that if I pass?), and it certainly helps with my eccentricities. But after 18 years, I need to belong.
America is truly a great place, if you forgive the amount of people who are unable to make a decent cup of tea, and the American people have very big hearts. It's a shame you Americans sometimes forget that. If I were driving in front of you on I95 during the rush hour, you might kill me to be in my space, one car ahead, but if I came to you and told you I needed $10 for a meal, you'd find a $20, give it to me, and never expect it back.
I don't believe the USA has such a bad rap around the world as the media portrays. Of course, some friction comes from America sometimes forgetting its place in history. I was reading in a local newspaper about one of the oldest single room school houses in America being relocated in Portsmouth, RI. It dates back to the 1700s! Old? I smile. My old school back in England dates back to 1558, and some of the original buildings still stand! (I suspect some of the teachers I had were hired by the first headmaster.)
Sometimes, it’s true, America acts like the overweight uncle who comes to the barbeque, breaks things, and makes the children cry. How nice it is, though, to have that uncle by your side. By nature, this is a peaceful country; don't bother us, and we have no need to bother you. Always there to help in a crisis. Even when your enemies have an emergency, the USA has mobilized relief supplies and sent them to help those in distress.
So why Citizen Geoff? In a few short weeks this nation, my adopted home, will go to an election. I really need my voice to be heard. So many issues are at stake. Immigration, for one, with which I have first-hand knowledge. I've been through the system, and for that reason, I don't see why illegal immigrants should get a fast track or amnesty. I played by the rules, it isn't hard, and on a local level none of these immigration advocates have done anything for me. As for the governor's executive order regarding eVerify, well, I felt no more or less fear than before the order was enacted.
Fannie Mae/Freddie Mac. Once again, the honest people, the working stiffs are getting stuck with the bill, ($700 billion) because the bleeding hearts wanted to help, insisting that everyone should be able to own a home. Why can’t people understand that there will be haves and have nots? It's an unfortunate fact of life, but with hard work and some common sense it doesn't take much to be a have. And how much have Dodd, Obama, Franks, and Reed skimmed off the housing industry? I don’t know about you, but I can’t wait for the investigations into their culpability.
The direction of the country. I moved from a country with socialist values. I know my parents, who were both active union and Labour Party members, will be spinning in their grave, but the American system truly offers the opportunity to make your dreams come true. Away from my parents’ influence, I have finally had the chance to realize that Thatcherism was a good thing. Having seen the state of the British healthcare system, and how the U.S. government efficiently runs everything from Amtrak to the Post Office to Freddie Mac, I’m of the opinion that this country cannot afford government controlled health. It's bad enough that the government has its fingers in the banking system.
The tentacles of state need to be removed from the lives of public citizens, and I hope my tiny voice will be part of the larger chorus. Change is a good thing, but I don’t want Barack's type of change. See you in the voting booth!
... Is Someone Looking for Solicitor Williamson's Legal Fees?
Here they are.
2004
Budgeted for "Administration": $100,000
Paid to Inman & Tourgee: $163,387
2005
Budgeted for "Administration": $70,000
Paid to Inman & Tourgee: $135,044
2006
Budgeted for "Administration": $70,000
Paid to Inman & Tourgee: $150,227
2007
Budgeted for "Administration": $75,000
Paid to Inman & Tourgee: $120,327
2008
Budgeted for "Administration": $75,000
Paid to Inman & Tourgee: $169,174
[Article in today's ProJo.]
Ken Block: A Painful Lesson in Rhode Island Health Insurance
My dermatologist dumped me this past Monday.
I was fairly new to her practice. Due to too many sunburns as a youngster, I need to see a dermatologist every three months. My previous dermatologist of many years had left the state, leaving me scrambling to find a doc who could take me right away. Many dermatologists don't take new patients or make you wait a year for your first appointment.
My dermatologist dumped me because my health insurance carrier changed from Blue Cross/Blue Shield of RI (BCBSRI) to United Health Care (UHC). On the day of my appointment, the receptionist took one look at my sparkling new health card and snarkily informed me that her office does not accept UHC coverage.
The fact that a doctor's office accepts insurance coverage from one carrier and not another is understandable. It is a bit bewildering that a doctor's office would not accept coverage from one of the largest insurance carriers in the United States — one of only three operating in the state.
As an employer, I was forced to change from BCBSRI to UHC due to cost; my annual renewal premium jumped almost 25% with BCBSRI. I asked for quotes from three carriers for my eight employees. Tufts is newly returned to the market after an absence of many years and came in 5% higher than BCBSRI, which in turn came in 5% higher than UHC.
How is it possible that a state-chartered non-profit like BCBSRI comes in higher for annual premiums than a for-profit carrier? You have to figure that the for-profit outfit is looking for 20% margins or so, which should translate into a significant rate advantage for the non-profit, and therefore a far less expensive cost for the purchaser of the insurance. Is the brand new skyscraper being constructed in downtown Providence for BCBSRI being financed by what I can only call over-charging for their services?
A large chunk of this year's premium increase was courtesy of our General Assembly, which decided to abolish the "healthy company" discount given to companies that used their health insurance less frequently than "less healthy" companies.
Isn't the whole point of insurance to price a policy based on the likelihood of that policy being used or not? Now, the pricing for all small businesses in RI, regardless of carrier, is determined based on the entire pool of covered employees of small businesses. Call this semi-socialized health insurance — whose net effect was a monster price hike for my company's coverage.
The General Assembly has passed mountains of health insurance regulations, many of which directly interfere with an insurance company's ability to operate profitably in the state. This is one of the main reasons that Rhode Island has such a lack of competition among carriers. This lack of competition leads to uncompetitive pricing and heavy-handed doctor tactics like refusing the insurance coverage of a large percentage of the population.
Our system of health coverage in this state is extraordinarily broken and is yet another disincentive for companies investigating moving to our state. The beaches aren't the only place to be burned in Rhode Island.
Ken Block is the chairman of the Moderate Party of RI
Pension Problem Based on More than Slight Undersight
The talking point of local unionists and ostriches is that our pension system is in trouble because a few years of low contributions in the '90s threw everything off, and all we have to do is to maintain funding for just a couple of decades, and the whole thing will work itself out right. That diagnosis is wrong, according to a panel convened by the General Assembly:
Even if the stock market rebounds next year, the cost to Rhode Island taxpayers of providing some of the most generous public employee pensions in the region will shoot from $370.9 million this year to a projected $836.3 million by the year 2017. ...... [Chief of Staff for the General Treasurer Mark] Dingley said the state is paying today for past mistakes, including decades of unfunded benefit increases, inaccurate actuarial assumptions, and earnings that have failed, over the last decade, to meet the 8.25 percent assumed rate of return on investments.
Despite union arguments to the contrary, he produced a letter from the actuaries that said the deferral of state contributions in the early 1990s has played a relatively small part. Had there been no deferral, it said, the state's required contribution this year would be 20.53 percent of payroll, instead of 21.13 percent.
Just another bomb waiting to go off in Rhode Island, with a fuse that nobody's willing to stamp out.
March 8, 2009
Obviously, Mr. President, You're Doing Too Much
The Telegraph has learned why Prime Minister Brown was given short shrift by the White House last week. According to the headline, President Obama was
'too tired' to give proper welcome to Gordon Brown
The article goes on to elaborate.
Sources close to the White House say Mr Obama and his staff have been "overwhelmed" by the economic meltdown and have voiced concerns that the new president is not getting enough rest.British officials, meanwhile, admit that the White House and US State Department staff were utterly bemused by complaints that the Prime Minister should have been granted full-blown press conference and a formal dinner, as has been customary. They concede that Obama aides seemed unfamiliar with the expectations that surround a major visit by a British prime minister.
But Washington figures with access to Mr Obama's inner circle explained the slight by saying that those high up in the administration have had little time to deal with international matters, let alone the diplomatic niceties of the special relationship.
Allies of Mr Obama say his weary appearance in the Oval Office with Mr Brown illustrates the strain he is now under, and the president's surprise at the sheer volume of business that crosses his desk.
It's perfectly understandable. All these bailouts. All this spending (even if it's someone else's money). The proposed massive restructuring of our health care system. So many people to try to save. So many Bushian wrongs to right. Of course it's exhausting.
Ease up, Mr. President. For your own sake, stop trying to do so much. One of the beauties of smaller government is that it means less wear and tear on those doing the governing. And you'd be surprised. It might even be the best course of action for the country.
A Word for Perspective and Fortitude
Begging the indulgence of our non-Christian readers, I found working through today's newspaper to be such a discouraging exercise, following on weeks (months) of seeing, personally and societally, people's economic vulnerability viciously exploited, that the second reading at today's Mass had an especial poignancy for me, and I'd like to share it:
Brothers and sisters:
If God is for us, who can be against us?
He who did not spare his own Son
but handed him over for us all,
how will he not also give us everything else along with him?
Who will bring a charge against God's chosen ones?
It is God who acquits us, who will condemn?
Christ Jesus it is who died—or, rather, was raised—
who also is at the right hand of God,
who indeed intercedes for us.
"It is God who acquits us, who will condemn?" If God created all — is all — then how can we not trust His strength in our lives to overcome the negative strength of bosses and politicians?
Move forward. These hard times will pass, and we'll be judged, and judge ourselves, on the basis of how well we tended the longer threads of our lives.
Robert Cushman: Unfunded Liabilities, Warwick’s “Subprime” Crisis
A few years ago, the dream of owning a home and planning for a comfortable retirement wasn’t just a promise--it was guaranteed. A growing economy was fueling a new "ownership society". We were told to invest, take a chance, buy a home, and don’t worry about the risk it will all work out.
What happened? Today the stock market is below 7,000 points, after experiencing a high in the 14,000 point range. Home foreclosures are at record levels, the value of our homes have dwindled, our 401Ks and other investments have suffered significant losses. The promises were false and the dreams have vanished, thanks in large part to the irresponsible action of the so-called "Masters of the Universe" on Wall Street. Our economy is in meltdown mode and taxpayers on the hook for trillions of dollars in losses. How could this happen? Where were the warnings?
During the years of irrational exuberance, a few individuals at the country's largest financial firms warned of the consequences of providing loans based on faulty consumer information. They raised the alarm that some of the mortgages being offered would be difficult for borrowers to repay and they called for responsible assessments of risk. But where were the government leaders to protect us--to watch our tax dollars, protect our future and our children’s future?
Subprime mortgages were fueled by mortgage brokers and bankers who were happy to keep writing mortgages as long as they were being bought up, chopped up and resold by Wall Street financial institutions in the form of mortgage backed securities. The risk of default was someone else’s problem.
Today you and I, the taxpayers of the United States, are sacrificing our hard-earned tax dollars to rectify these false assumptions. If Warwick's Mayor Avedisian assumptions regarding recent contract extensions with municipal employees prove to be false, will Warwick taxpayers be asked to make the same sacrifice?
With the city’s unfunded pension liability at $200 million before the market crash, why would city leaders promise to increase municipal employee pension benefits without demanding current actuarial reports to determine pension valuations based on market conditions? With the unprecedented crash in the financial markets, Warwick’s pensions have lost more then 30% of their value and the unfunded liability has grown substantially. But apparently believing that ignorance is bliss, the Avedisian administration is cheerfully using 2006 actuarial numbers to determine how much employees will pay for the increased pension benefits being granted in these future contracts. Just as subprime mortgage lenders used faulty information and unrealistic assumptions in granting reckless loans, the Avedisian administration is committing taxpayer dollars with no clue as to the real consequences of their action. If future pension shortfalls occur, municipal employees are indemnified from the risk and they will receive the enhanced benefits they have been promised by the Mayor. It will be Warwick taxpayers once again stuck with paying the bill for any future liability.
Shockingly, Mayor Avedisian also is taking $500,000 budgeted to city pensions to help balance this year’s operating budget based on the same antiquated information. Can we continue to underfund these future obligations? Are we being fair to future retirees, if we can’t afford to pay their promised benefits?
Although they have been labeled as savings by the administration to promote ratification of these contracts, the city is deferring almost $2 million more in employee holiday pay and uniform allowances. No matter how it is spun, a deferred expense without a plan to fund it, is nothing more then another unfunded liability.
The unfunded health care liability in Warwick is $365 million. These contract provisions promise employees a fixed rate healthcare co-pay of $14 per week for individuals and $28 per week for families. The city council chose to approve these fixed rates, guaranteeing that taxpayers will pay 100% of any increase in health care costs for the next three years, another unfunded liability that will draw more and more tax dollars away from other vital programs in the city.
Warwick’s unfunded pension and healthcare liabilities are approaching $650 million. That equates to about $7,500 in debt for every man, woman and child living in the city. The time will come when these liabilities will have to be paid.
Already we are seeing financial conditions in the city deteriorate, a dangerously low surplus, frozen bond money, school building in disrepair and crumbling infrastructure. Can we continue to ignore the risks associated with making more and more costly promises, creating more and more obligations, deferring more and more expenses and sinking deeper and deeper into debt? How much longer can taxpayers sustain new tax increases, cuts in city services, and deferred improvements to school buildings and city streets? What impact will these IOU’s have on our children’s future and the promises we have made them?
Like the subprime homeowner unable to afford their mortgage, will we soon be viewing a field of broken promises in Warwick and see the dreams for our children shattered and be left wondering, why anyone didn't warn us this was coming?
Robert Cushman is a former Warwick City Councilman and former Chairman of the Warwick School Committee.
A Rhode Island Tale: On the Patronage Train
There's not much to say about this, but it's so nearly a cliché unto itself that it begs mention:
Without any official notice, the Senate yesterday voted unanimously to confirm House Speaker William J. Murphy's deputy assistant, Patrick T. Burke, as a special magistrate in the Superior Court. ...Unlike judges, magistrates are not vetted by the state's Judicial Nominating Commission in an open and competitive arena. They are recommended by the top judges of each court, in this case Superior Court Presiding Justice Joseph F. Rodgers Jr., who urged speedy action on the Feb. 26 nomination. ...
[Burke] was at the center of a controversial court case that worked its way to the state Supreme Court in the 1990s that evolved from his arrest by the Warwick police in 1993 after they observed his car weaving on Route 2 around 2:30 a.m. The police charged him with refusing to submit to a portion of the breath test, and the traffic court suspended his license and scheduled a hearing that never took place after being continued seven times, the last time at the prosecutor's request because she knew Burke through the courts and questioned whether she could be impartial.
Burke's lawyer, then House Speaker John B. Harwood, in 1996 filed for dismissal, saying the state’s action deprived Burke of his right to a speedy trial. Judge John F. Lallo dismissed the charge, but fined Burke for a roadway violation. The attorney general's office appealed to a three-judge traffic appeals court panel, which upheld the dismissal. The attorney general appealed to the state Supreme Court, which refused to hear the case.
And now he starts tomorrow at his new $150K position. Eased into the soft cushion of Rhode Island putrefaction.
March 7, 2009
Saturday night laughs
Isn't this just wonderful? Obama Car Czars To Visit Detroit To Learn About Industry
President Barack Obama’s chief auto advisers, Ronald Bloom and Steven Rattner, plan a one-day trip to Detroit next week to meet with executives at General Motors Corp. and Chrysler LLC, people familiar with the matter said...The trip follows two weeks of meetings with auto executives, suppliers, analysts and others as they review the two carmakers’ plans to keep $17.4 billion in loans and borrow as much as $21.6 billion more to survive. GM and Chrysler executives met with the committee last week in Washington to discuss progress.
Two weeks of immersion in a failing industry that they don't know after which they will then play a critical role in deciding whether to spend tens of billions of our hard-earned monies.
Golly, I feel better, don't you?
When they have figured out Detroit, I'll bet they can then resolve any healthcare industry issues by the end of the month.
Okay, Iran's nuclear program is especially tough so they might need the whole month of April to work it out with those crazy mullahs.
World peace and economic serenity by summertime 2009. I can see it, can't you? LOL.
And, by the way, who is going to be overseeing these wonderful bureaucrats? People in Congress like the ones who oversaw Fannie Mae and Freddie Mac.
With such comfort, I am going to sleep well tonight. How about you?
David Brooks Lulled Back to Doze
Apparently worried that their leg-tingling "conservative" in the New York Times was shedding his cataracts of hope and change (one on each eye, presumably), the Obama team approached David Brooks with a targeted spin campaign, and in his view, they're almost comfortably moderate again. Boy, that was easy:
I didn't finish these conversations feeling chastened exactly. The fact is, after years of economic growth, the White House still projects perpetual deficits of more than $500 billion a year. That's way too much, especially with the boomers' retirements looming. Moreover, Congress will likely pass the spending parts of the budget and kill the revenue parts, like the cap-and-trade energy tax and the limits on itemized deductions, thus producing much, much bigger deficits.Plus, I'm still convinced the administration is trying to do too much too fast and that the hasty planning and execution of these complex policies will lead to untold problems down the road.
Nonetheless, the White House made a case that was sophisticated and fact-based. These people know how to lead a discussion and set a tone of friendly cooperation. I'm more optimistic that if Senate moderates can get their act together and come up with their own proactive plan, they can help shape a budget that allays their anxieties while meeting the president's goals.
I happen to know a tradesman whose employer habitually coerces extra work from his employees and subcontractors through a blend of deception, direct economic threats, and implicit physical aggression. Deadlines are said to be shorter than they actually are; the budget is being busted by the workers' incompetence; mistakes ultimately derive from the same, not managerial errors; and the upshot is always that more money ultimately flows to the guy in charge, as he belittles his crew and makes a living nightmare of their professional lives.
In different circumstances, however, when the boss needs a particular person, the attitude is all camaraderie and promises of opportunity. With no more time than it takes to turn his head, the guy will go from irate abuser saying whatever's necessary to get his way to ingenuous businessman just trying to get along, hoping that everybody can be happy in their careers. The tradesman has seen an obscenity-flinging raver transform into an affable pal with the click of a cell-phone disconnect button.
You know, it takes a while for folks to catch on that Dr. Jekyll is really the same person as Mr. Hyde, that one doesn't graduate to consistently better treatment by working hard and giving that extra little bit, and those raised with proper instincts for responsibility are most vulnerable to repeated victimization. They want to believe in the vision of opportunity and its acquisition that they've learned ought to be possible, and he exploits that psychologically and economically positive quality.
The parallel isn't exact, but that's the dynamic that comes to mind with the Obama team's talent for persuasion. During the campaign, Mr. Obama was everything to everybody. Absolution and vindication all at once. Now as he has begun rolling out policies, and as warning alarms have begun to sound among his admirers, anonymous minions (perhaps the man himself) are going on background to charm the prominent among them.
We'll see, I guess, whether proper instincts prove to be a detriment or a source of strength in the future.
An Increase as "Savings" in Tiverton Contract
It so happened that, the week my letter about Tiverton officials' relationship with the public unions appeared in the Sakonnet Times, the town council posted a "tentative agreement" with AFSCME Council 94, slated for ratification at Monday's town council meeting. The coincidence led one commenter on the Sakonnet Times site to aver hypocrisy, on my part, for treating the teachers' union as unique. (The magnitude of cost is apparently not a factor in judging a conservative's "hypocrisy.")
That commenter is not the only person who's asked my opinion, so as I would have done anyway, I spent some time looking through the various documents related to the agreement. Of particular interest is the PDF showing $117,065 in savings over the life of the contract: Unless I'm misreading — and I couldn't make the provided numbers translate into the stated decrease* — the town derives that dollar amount by assuming increases in salaries and other costs and counting some mitigating changes as "savings."
Based only on this "contract negotiations summary" document, however, the estimated cost to the town of this contract represents an increase of $114,647 (3.4%) decrease of only $5,233** compared with a scenario in which the contract total would be held steady at the '07/'08 level over the same period. Since that year was the most expensive of its contract, the total cost surely increased.
This is why the town — like the state — is in its current predicament: It begins with what sounds like a fair-sounding pay increase (2.5%), rather than starting from the perspective of the taxpayer. What makes town officials think that the town will have more to spend on these services in a few years than it had at the tail end of an era of plenty during a housing boom?
At a time when newspapers are reporting the fastest rate of job loss since the 1970s, and when economists have begun pushing back their predictions of recovery by six-month intervals, agreements should be made on a one-year basis and strive for an overall balancing of cost increases and expenditure savings. Towns factor in the increases and decreases in the cost of utilities and healthcare, but they never apply the same calculations to labor. I'm sorry to say it, but the cost thereof is way down, based on the ready supply of new employees, and if union workers insist on a three-year term that protects their jobs for that duration, they ought to make the town a better offer. Otherwise, the town should consider, in a sense, going out to bid.
* I've emailed the town administrator asking for the formula that arrives at these numbers.
** My initial number resulted from a data entry error as explained here.
UPDATED: Is Obama clueless or are his actions intentional?
UPDATED: Roger Kimball:
I was having lunch yesterday with a prominent critic of the Spender in Chief, and he raised a possibility that many of us have entertained over the past several weeks: that Obama is simply out of his depth: that he hasn’t a clue about what makes the economy tick and his talk about the "profit-to-earnings ratio" was not a slip of the tongue but a worrisome confirmation of the suspicion that he is an empty suit floundering around in the dark.We kicked around that possibility for a few minutes: certainly the Obama administration seems like a monument to incompetence. Consider the multiple appointment fiascos. Consider his treatment of Gordon Brown, Prime Minister of the country that has been our staunchest ally. Consider, if you can stand it, the economy: That sucking sound–the only palpable trace of the once-mighty U.S. stock market–reminds us what the market makes of Obama’s plans to raise taxes on "the rich," the middle class, business. It reminds us what the market thinks of his efforts to shove the coal industry into a death spiral with absurd cap-and-trade carbon emissions regulations. And that’s all before breakfast, before he sets about wrecking the U.S. health care industry by turning it, too, over to Washington for ruination.
Yes, we agreed, it certainly looks like incompetence and, judged by its results, is effects, its consequences for this great country, it is incompetence on a breathtaking scale.
And yet, is it only incompetence? Remember, shortly before the election, Obama boasted to his mesmerized supporters that "We are five days away from fundamentally transforming the United States of America." Is that not what he has set about doing–with a vengeance? [Here.]
And here’s where we began talking about another possibility: that Team Obama was deliberately targeting the U.S. economy, deliberately impoverishing millions of Americans, deliberately angering our closest allies while coddling dictators like Putin and his puppet Medvedev and funneling millions to terrorist organizations like Hamas...
...Each step strengthens the role of government in people’s lives. That’s exactly what Lenin sought to do...
Lenin, too, wished to "spread the wealth around." And Obama, like Lenin, has been perfectly frank in recommending that we need to go beyond the "merely formal" rights enunciated in the Constitution in order to "bring about redistributive change" in society.
That’s where Obama’s much heralded–and astronomically expensive–"green" initiatives come in. Only they aren’t really (or are only incidentally) "green," i.e., concerned with the environment. At bottom, they are pink, i.e., they are political weapons in a socialist battle against "greedy" business interests.
Who, I wonder, was the political genius who saw the advantages of exploiting people’s sentimental gullibility about the environment for partisan profit? We’ve long known that environmentalism, as the philosopher Harvey Mansfield put it, is "school prayer for liberals." But I wonder whether even Professor Mansfield could have foreseen what a tool pseudo-environmentalism would be for the radical wing of the Democratic party? The inestimable value of a green, that is, a pink, philosophy is that you can never be green enough. And in pursuit of zero-carbon-emissions purity a government can impose crippling sanctions in order to force compliance. And don’t say Obama didn’t warn you: as I and many others pointed out during the campaign, he promised that, if elected, he would do all he could to "bankrupt" the coal industry...
ORIGINAL MARCH 5 POST & ADDENDUMS
Hmmm.
Jennifer Rubin has written a piece entitled 'I'm Maureen Dowd, and I've Been Had' (H/T):
They may need a support group before the month is out. They could gather in New York or Washington where many victims reside. The meetings would start: “I’m Maureen [or David]. I’m a duped Barack voter. And I’m mad.”The ranks indeed are filling with the disaffected and the disappointed — Chris Buckley, Maureen Dowd, David Brooks, David Gergen, and even that gynecological sleuth and blogger Andrew Sullivan. And then there is the very angry Marty Peretz. Their complaints are varied but expressed with equal amounts of remorse and bitterness. They all have been done wrong by Barack...
All in all it is one dismayed and bitter group, filled with recriminations and a bit of self-flagellation. And it’s not hard to recognize that, as in any grieving process, they have passed through denial (when all who criticized their beloved Obama were excoriated and ridiculed) and are in the second step: anger. They were misled or deluded into believing Obama was a moderate or an indefatigable supporter of Israel or a fiscal grown-up or a reformer (take your pick).
They and the rest of the country are figuring out the bitter truth: Obama bears little resemblance to the moderate and soothing figure who tied up John McCain in knots. He bears even less resemblance to the Agent of Change. Rather he’s pretty much the Chicago pol who went to the Senate to be its most liberal member.
And for the wounded Obama supporters, we can offer just one bit of counsel: you have lots of company. There are trading floors filled with sympathetic souls and businesses filled with stunned executives. They didn’t get what they bargained for either...
Kind of like yesterday's post here on AR. Stuart Taylor has more: Obama's Left Turn - Centrists fear that the president's budget reveals his liberal leanings.
Peter Robinson: "A couple of implications here are worth noting. The first is that a deep, recurring pattern of American life has asserted itself yet again: the cluelessness of the elite...The elite journalists, I repeat, got Obama wrong. The troglodytes got him right. As our national drama continues to unfold, bear that in mind."
The conventional wisdom is that Obama, with strong majorities in both houses of Congress, will get every legislative initiative he wants. And from a sheer vote counting viewpoint, that would certainly be true.But could the countervailing force not be the oft-spineless Republicans with their limited votes in Congress?
Could the real counter come from the financial markets themselves, which sense both the magnitude of the economic downturn and how Obama's proposed statist solutions will only compound the problems and adversely impact any recovery?...
So is it a race between a financial market collapse, accelerated by its reaction to Obama's policy proposals, and Obama's aggressive and statist policy implementation effort?
Will the financial markets then be the force which galvanizes a broad reaction from the American people?...
Incentives matter deeply and drive human behavior. It is a lesson statists and socialists never learn...
Ledeen on de Tocqueville from the second link above:
...We will not be bludgeoned into submission; we will be seduced. [Tocqueville] foresees the collapse of American democracy as the end result of two parallel developments that ultimately render us meekly subservient to an enlarged bureaucratic power: the corruption of our character, and the emergence of a vast welfare state that manages all the details of our lives. His words are precisely the ones that best describe out current crisis:That power is absolute, minute, regular, provident and mild. It would be like the authority of a parent if, like that authority, its object was to prepare men for manhood; but it seeks, on the contrary, to keep them in perpetual childhood: it is well content that the people should rejoice, provided they think of nothing but rejoicing. For their happiness such a government willingly labors, but it chooses to be the sole agent and the only arbiter of that happiness; it provides for their security, foresees and supplies their necessities, facilitates their pleasures, manages their principal concerns, directs their industry, regulates the descent of property, and subdivides their inheritances: what remains, but to spare them all the care of thinking and all the trouble of living?It is evident that our associations, along with religion one of the two keys to the great success of the American experiment, are prime targets for the appetite of the state. In the seamless web created by the new tyranny, everything from the Boy Scouts to smoking clubs will be strictly regulated. It is no accident that the campaign to drive religion out of American public life began in the 1940s, when the government was consolidating its unprecedented expansion during the Depression and the Second World War, having asserted its control over a wide range of activities that had previously been entrusted to the judgment of private groups and individuals.
When we console ourselves with the thought that the government is, after all, doing it for a good reason and to accomplish a worthy objective, we unwittingly turn up the temperature under our lobster-pot. The road to the Faustian Deal is paved with the finest intentions, but the last stop is the ruin of our soul.
Permitting the central government to assume our proper responsibilities is not merely a transfer of power from us to them; it does grave damage to our spirit. It subverts our national character. In Tocqueville’s elegant construction, it "renders the exercise of the free agency of man less useful and less frequent; it circumscribes the will within a narrower range and gradually robs a man of all the uses of himself."...
...The great Israeli historian Jacob Talmon coined the perfect name for this perversion of the Enlightenment dream, which enslaves all in the name of all: totalitarian democracy.
These extreme cases help us understand Tocqueville’s brilliant warning that equality is not a defense against tyranny, but an open invitation to ambitious and cunning leaders who enlist our support in depriving ourselves of freedom. He summarizes it in two sentences that should be memorized by every American who cherishes freedom:
The…sole condition required in order to succeed in centralizing the supreme power in a democratic community is to love equality, or to get men to believe you love it. Thus the science of despotism, which was once so complex, is simplified, and reduced, as it were, to a single principle.
Will the next question for these disillusioned pundits be to ask whether Obama is truly clueless on economic issues OR whether he is intentionally acting in a way to bring down the economy so as to justify his socialist beliefs/policies?
There is a paper trail which stands behind these thoughts regarding Obama's radical beliefs - More here, here, here, here, and here.
Then there is Obama's pre-election paper trail with numerous links to his many statements not covered well by the MSM.
A thoughtful person has to admit that no other U.S. President has ever had political connections or espoused beliefs which are so questionnable and out-of-line with mainstream opinions.
Is the evidence pattern enough to at least make more people stop and think about what are Obama's true intentions? Will they then take the next step and speak up against Obama's wealth-destroying and liberty-limiting policies?
Or are we all going to be looking belatedly for our own support groups where we talk about how we were also duped?
ADDENDUM
Power Line writes:
[Obama doing it intentionally] is, I admit, an intriguing theory, but I don't buy it. Obama can't possibly want to be a one-term failure. That's what happened to Jimmy Carter, and Obama must know that it will happen to him, too, if his policies are perceived as dragging down the economy.More likely the explanation is that Obama is an economic illiterate, and subscribes to the idea--which I think is rather common among Democrats--that what the government does has little impact on the economy. Obama likely believes that the economy will recover on its own, and in the meantime--in Rahm Emanuel's immortal words--he shouldn't let the crisis go to waste. So he enacts every left-wing measure that he wanted to do anyway, expecting that when the economy eventually recovers he can take credit for it, even though his policies, if anything, retarded and weakened the recovery.
That's a cynical strategy, although not quite as cynical as destroying the economy on purpose; the difference is that it may well work.
During the general election, Obama showed himself to be ignorant about history so it is not unreasonable that he would also be economically illiterate, too.
But he is also showing himself to be quite the leftist ideologue. Since ideologues act based on their faith beliefs, regardless of empirical evidence, I think it is hard to say definitively it is just illiteracy.
ADDENDUM 2
Boskin: Obama's Radicalism is Killing the Dow. Rubin's comments:
...Democrats may shrink from the label "socialist," but they can’t deny the scope and direction of the president’s agenda. More important, they’re not embracing a model which has (ever?) succeeded in producing growth and prosperity. So whatever you call it, it is not a recipe for recovery.
The radical implications of Obama's budget proposal. Victor Davis Hanson provides some historical context. Michael Barone:
The Obama tax plan, combined with major state tax plans, puts not a three in front of the high earners' tax rate as the Clinton plan did, it puts a four or a five in front of it. And at that point, I fear, the animal spirits of high earners are going to be directed away from productive investment and toward tax avoidance and tax shelters. Away from creating new enterprises that can provide avenues upward for any and all, and toward gaming the system for the well-connected and shrewd insiders. Away from an economy that grows more than anyone imagined and toward an economy where system-gamers take shares of a static pie away from the rest of us. Is that where we really want to go?
Fred Barnes is onto the scam: "Given the moderate-to-conservative viewpoint of voters, Obama has a motive in pushing to have his uniformly liberal agenda approved by Congress as rapidly as possible–before voters catch on to the fact it’s not what they voted for."Or to put it differently, the Wall Street Journal editors conclude that "economies don’t spiral down forever without a reason and without policy encouragement. What’s worrying about the plunge in equities since January 2, and especially in the last week since Mr. Obama released his radical budget, is that it has come amid the unveiling of the President’s policy agenda. Equity prices have reacted to those proposals by signaling that they expect a much deeper and longer recession."...
Charles Krauthammer calls Obama on the bait-and-switch: "Clever politics, but intellectually dishonest to the core. Health, education and energy — worthy and weighty as they may be — are not the cause of our financial collapse. And they are not the cure. The fraudulent claim that they are both cause and cure is the rhetorical device by which an ambitious president intends to enact the most radical agenda of social transformation seen in our lifetime." Actually the proposals not only aren’t the cure, the taxes and regulatory regime which accompany these plans are likely to make things worse.
Healthcare policy: The latest example of Obama's disdain for liberty.
ADDENDUM 3
Rediscovering first principles. (Lots more here if you want to do a deep dive on many first principles.)
A focused, video comparison between two different world views: Obama versus Reagan.
March 6, 2009
Displacing the Tiverton Elite
I've got a letter in the current Sakonnet Times, responding to some discouraging observations at recent town meetings:
To the editor:The self-presumed ruling class of Tiverton — in and out of office — has no governing ideas but to raise taxes in good times and bad while comfortably accepting that most of the town's budget is locked in by law or by contract. So, they've turned their ire toward the members of Tiverton Citizens for Change who have stepped forward to change the trajectory of municipal government.
First the accusation against TCC was, "They're not from here, and they haven't done anything!" Then it was, "They're not from here, and they make mistakes when filing campaign finance forms!" The new one is, "They're not from here, and they need practice conducting public meetings with a hostile audience!"
Well, golly. The meetings that the familiar voices reference are those of the current Budget Committee, on which local reformers have a controlling hand, and the heat radiated most strongly (thus far) when the group interviewed the School Committee. It's almost as if the town aristocracy is trying to distract from school officials' admission of difficulty facing down the obscenely aggressive National Education Association labor union.
An anonymous commenter on my web site, AnchorRising.com, mocked Budget Committee (and TCC) member Thomas Parker, a successful naval officer, and suggested that we should "take a good look at who we have running some of our meetings and think about providing effective leadership to the town in this time of crisis." Yes, let's.
At its most recent, notably quiet, meeting, the School Committee did not have members of the Town Council gabbing disruptively in the back of a small meeting room or former School Committee Vice Chairman Mike Burk bellowing attacks as he paced the room, both of which set the tone of the prior Budget Committee meeting. However cordial their gatherings, school committee members and representatives bemoan the strength of the teachers' union and (unbelievably) their own sense that they have weak hands for negotiation. (How about having employment on offer during the worst downturn since the Great Depression?) And when the town administrator and council president recently asked for financial help to maintain services in the current budget, committee members were awfully quiet, considering that the request came mere weeks after they had given away hundreds of thousands of dollars to the intimidating unionists.
On the Town Council side, meeting attendees walk away with the sense that even contracts that are up for negotiation are "locked in." Council President Don Bollin recently declared an inability to "trim a budget based on what [he] would like to see happen in negotiations," and that "it's easier to have the money put back should the results we want happen." As the School Committee recently acknowledged, however, the unions typically demand more than is budgeted, rather than allow any earmarked dollars to flow back to the town. Indeed, a central rationalization of the school department for awarding not only raises but retroactive pay was that the "money was in the budget."
So, if your overarching preference is for peaceful government meetings in which all of the meat is chewed during executive sessions and in which officials practice comity most enthusiastically while conspiring, along with the unions, to manipulate procedural rules to ram double-digit tax increases through financial town meetings, then side with the familiar faces. Me, I'll take fresh leadership that conducts entertaining meetings but checks unions to lower taxes and maintain services at the same time.
Providence Middle School Flag Brouhaha
Can someone please explain:
- the flags of which countries are subjugated to rights of free speech and which are not;
- how, when faced with a "situation" in the City of Providence, to determine if it requires a careful, six figure investigation or if it qualifies for an off-the-cuff snap judgment.
Boskin: Obama's Radicalism is Killing the Dow
It's hard not to see the continued sell-off on Wall Street and the growing fear on Main Street as a product, at least in part, of the realization that our new president's policies are designed to radically re-engineer the market-based U.S. economy, not just mitigate the recession and financial crisis.
Martin KozlowskiThe illusion that Barack Obama will lead from the economic center has quickly come to an end. Instead of combining the best policies of past Democratic presidents -- John Kennedy on taxes, Bill Clinton on welfare reform and a balanced budget, for instance -- President Obama is returning to Jimmy Carter's higher taxes and Mr. Clinton's draconian defense drawdown.Mr. Obama's $3.6 trillion budget blueprint, by his own admission, redefines the role of government in our economy and society. The budget more than doubles the national debt held by the public, adding more to the debt than all previous presidents -- from George Washington to George W. Bush -- combined. It reduces defense spending to a level not sustained since the dangerous days before World War II, while increasing nondefense spending (relative to GDP) to the highest level in U.S. history. And it would raise taxes to historically high levels (again, relative to GDP). And all of this before addressing the impending explosion in Social Security and Medicare costs...
From the poorly designed stimulus bill and vague new financial rescue plan, to the enormous expansion of government spending, taxes and debt somehow permanently strengthening economic growth, the assumptions underlying the president's economic program seem bereft of rigorous analysis and a careful reading of history...
On the growth effects of a large expansion of government, the European social welfare states present a window on our potential future: standards of living permanently 30% lower than ours. Rounding off perceived rough edges of our economic system may well be called for, but a major, perhaps irreversible, step toward a European-style social welfare state with its concomitant long-run economic stagnation is not.
President Barack Obama now has the distinction of presiding over his own bear market.The Dow Jones Industrial Average fell 20 percent since Inauguration Day, the fastest drop under a new president in at least 90 years, according to data compiled by Bloomberg...
Yep.
ADDENDUM
(H/T)
The latest example of Obama's disdain for liberty
On Obama:
More on Obama's support for socialized medicine.
The Healthcare Trojan Horse in the Porkulus Bill.
On healthcare policy issues:
How government created the problem in the first place.
More on drug costs and government allocation of healthcare services.
So drug costs - the frequent target - are roughly 10-12% of total healthcare costs. The socialists want to reduce their costs when they are only a small portion of the total cost of delivering healthcare services. Not only is that an action which will stifle new drug innovation, thereby adversely impacting the health of future generations, but the lesser/non-use of drugs will often result in more and longer hospitalizations when the symptoms managed by drugs are under less clinical control.
Hey, Obama's historically ignorant and, at a minimum, economically illiterate. So why not add foolish about healthcare services to the growing list?
Get that man a Tele-prompter quickly so he will know what to say!
On Laffey and Movement Building
I imagine that even people who've had reservations about Steve Laffey have a feeling of "what now" upon hearing of his intention not to run for governor. For my part, I wanted to listen to his entire conversation with Dan Yorke before commenting, as well as Dan's interview of Harry Staley and Jim Beale from the Rhode Island Statewide Coalition.
Laffey sounded relaxed and comfortable, contemplative, and to be honest, I found my comfort level with him rising. My experience with the man isn't sufficiently broad for me to know whether this represents a change or just a face that I hadn't previously seen, but given the context, I felt a sadness that it hadn't been more prominent earlier.
But the real shame of his announcement is that Laffey's message seems to be, "Rhode Island isn't ready for me yet." There's no movement for him to grab hold of, and that being the case, it's probably a shrewd move to avoid the expense in money and effort of a high-profile political race. I did not get the sense, however, that he intends to help such a movement to germinate. Oh, Laffey has donated to and promoted candidates for office, and he may continue the practice going forward, but that's not the same as the slow, tedious work of motivating people and changing a civic culture.
Each person has his or her own interests, corresponding with unique talents, and in a functioning system, they'll fill different roles in the machinery of progress. That is to say that it doesn't necessarily indicate selfishness when a particular person declines to take up a particular task. Quite apart from Mr. Laffey, though, we should all hope that the process of putting together a reformist machine brings forward leaders from whom he'd have difficulty wresting the wheel when he feels that the state is ripe for harvest.
In the meantime, we're in for a number of painful, discouraging years. Shoulder to the stone!
March 5, 2009
Laffey WILL NOT Run for Governor in 2010
Former Cranston Mayor and Senate Candidate Stephen Laffey has announced that he will NOT run for Governor of the State of Rhode Island in 2010. More coming on WPRO's Dan Yorke show shortly.
UPDATE:
Laffey spoke to Dan Yorke and elaborated on the reasons why he chose not to run. He stated he based his decision on a few factors. First, he clarified that his decision leaked out before he had been fully prepared to discuss it. He then stated that for the last two years, he's been out of politics and has enjoyed being with his family. However, the primary reason is that, as he sees it, there still isn't a real, broad-based movement striving to improve RI State Government and the current way of doing business (budgets, pensions, reforms, etc.). Therefore, he has concluded that not enough people want to really fix things yet and that a few people here and there, including himself, aren't enough to effect real change without broad support. Basically, he thinks that more Rhode Islanders need to wake up before the effort of individuals like himself will be able to do any real good.
It seems his thinking was affected by the recent elections where some good candidates were run on the GOP side and still lost. He also offered that, in his opinion, the GOP (both the state and national) "is a disaster." He was also influenced by seeing his work in Cranston undone over the last two years (presumably, until the election of Alan Fung). There is also, obviously, some disenchantment with the national party's role in his own Senatorial election. He also stated that he did no polling or the like that could have influenced his decision.
In short, Stephen Laffey has given up on Rhode Island...for now.
Tweaking the Pork Position: Aged is Fine, Fresh is Bad
As Congress successfully fends off attempts to reduce the considerable pork in an omnibus spending bill, President Obama has indicated that he will not veto the bill. Defending an apparent flip-flop on a campaign promise,
The White House says this bill is just last year's unfinished business -- and next time, it will be different."We'll change the rules going forward," White House Press Secretary Robert Gibbs said Wednesday when asked about the legislation.
For the record, Senator John McCain lists... make that, tweets the "Top 10 Porkiest Projects" in the bill.
And Conn Carroll over at the Foundry points out that the costly aspect of pork is not so much its own price tag but what it buys.
The problem with earmarks is not $16 million for water-taxis and manure management. All 9,287 earmarks in the omnibus bill come to a total of $12.8 billion, or 3% of the total package. The problem with earmarks is the other spending that 3% buys. As data from the Office of Management and Budget shows, the rise in the number of earmarks tracks closely with the rise in overall spending by the federal government. Sen. Jim DeMint explained the link to Politico last year: “I talked to colleagues who would say, ‘DeMint, I gotta vote for this bill because it has my project in it,’ even though the bill was way over budget.” The evil of earmarks goes far beyond their nominal price tag. The real damage they do to our country is the votes they buy for ever higher levels of spending.
Flipping that around, every serving of pork, earmarked as much for a reelection campaign as for a specific district, comes with a three thousand percent surcharge. On the bright side, it all ends next year ...
Taxing the Rich and Hurting the Poor
Apparently we are all well aware that the rich can afford to pay more taxes--"their fair share." But can the poor afford it?
The administration’s recently released budget will limit tax deductions on gifts made to charities by those earning over $250,000 a year, raising (we are told) almost $180 billion over the next ten years. It’s an extraordinary grab for money — money given to private charities by private citizens as private donations. These donations directly fund programs that (among other things) feed, clothe, and house the poor, deliver after-school programs to disadvantaged children, build new facilities for colleges and other schools, and generally enrich everyone’s lives through education and the arts.The study did find that overall giving doesn't dip as bad when the focus is broadened and that charitable giving rates track closely with the stock market:The way this will work in practice goes like this: Assume someone in the top tax bracket wants to make a $1,000 donation to a local homeless shelter. Currently they would be eligible for a deduction at the top 35 percent rate, so the donation costs them only $650. This proposal would allow deductions at only the 28 percent rate, meaning the donation will now cost $720, an increase of over 11 percent. In other words, $70 that could have gone to the homeless shelter will now go to the government. In the aggregate, then, charities can expect to lose about 7 percent of their contributions from givers in the higher tax brackets. The new top tax rate of 39.6 percent in 2011 makes the math even more punitive, making the cost of donations 19 percent higher.
A study released Friday by the Center on Philanthropy at Indiana University shows that if the provision had been in place in 2006, charities would have lost almost $4 billion in donations in the intervening period. With the incomes of the so-called wealthy dropping, at the same time that their taxes are going up, it’s hard to see how limiting the deduction will not have a significant impact on charitable giving. The dollars taken away from private donations and directed into government coffers are not going to be magically replaced.
The drop in giving is less stark when looked at in the context of how it would affect all Americans who itemize on their tax forms and claim charitable deductions. Total giving by people who itemize would have dropped just 2.1 percent if the Obama plan had been in effect in 2006, the center estimated. Itemized charitable contributions totaled nearly $187-billion that year.Remind me: how has the stock market performed in reaction to the Obama economic "plan"? Finally:But the center cautioned that giving is far more likely to be affected by the condition of the stock market than by President Obama’s tax proposals. It noted that every time the stock market declines by 100 points, giving declines by $1.85-billion. Charitable donations rise by that same amount when the stock market increases.
Patrick M. Rooney, interim director of the Indiana center, said he worried about the effect of the tax change at a time when the downturn in the economy has put a squeeze on many donors and the charities they support.But there may be hope yet.“Tax incentives do stimulate more giving,” Mr. Rooney said, “and the challenges facing the nonprofit sector in 2009 suggest that this might be a good time to provide additional incentives, rather than reduce the value of the tax deduction for high-income households, so that the donors with the greatest capacity to give have more reasons to do so.”
Scoring the State Labor Relations Board
The Ocean State Policy Research Institute has kicked off LRB Watch to track the wins with the State Labor Relations Board. Despite claims from certain quarters that the board is "management" heavy, OSPRI finds that labor has one 15 of 19 decisions since 2006. When it comes to matters that OSPRI classifies as "major" — based mostly on "the establishment or reinforcement of precedents of potential wide application" — labor is seven for seven.
Not that the actual record will matter to those aforementioned quarters.
"Like a Talk Show on the Internet"
That was Matt Allen's description, last night, when Marc took the spotlight on Matt's show to review some of the conversation that we're having 'round here. Stream by clicking here, or download it.
March 4, 2009
Helen Glover's Nancy Pelosi's "Sweatin' to the Socialists"
Is your regular workout not doing the trick on some ... holiday excess?
WHJJ's Helen Glover has found the perfect, high-intensity exercise video to help you shed those last stubborn pounds.
Do We Really Need Legislators Involved in Youth Sports?
No. We don't. But the RI Senate is gonna try (S0169) (h/t Dan Yorke):
41-12-1. Legislative findings. – The Rhode Island general assembly finds that parents lack a proper outlet to share concerns and objections about youth sports. The general assembly further finds that there is a need for increased transparency and direction within youth sports programs in the state of Rhode Island. Therefore, the general assembly finds that a youth sports oversight council is necessary to increase access and improve quality of youth sports programs in the state of Rhode Island.Stop right there. To my knowledge, every local sports league in this state is subject to the rules and regs of a Statewide body. That's where complaints should go. Not to the freaking General Assembly!
41-12-2. Composition of council. – There shall be a youth sports oversight council consisting of seven (7) members. The governor shall appoint members with the advice and consent of the senate. The governor shall give due consideration to appointing members with the following qualifications: one member shall be from northern Rhode Island; one member shall be from South County; one member shall be from the East Bay; one member shall be from Providence. Members of the council shall receive no compensation for their participation. The council shall elect from among the members a chairperson, vice chairperson and any other officers it deems necessary.Trouble here...way too broad there guys. The only way to do it right is to have 37, one from each town (HA!).
41-12-3. Powers and duties of council. – (a) It shall be the duty of the council to provide oversight and mediation to any youth sports organization in the state of Rhode Island. If any person has a complaint with the actions of coaches, players, parents or officials during any youth sporting event at any town or state field or facility, the person shall file a complaint with the council.Obviously, these guys have never actually run a sports a league.
(b) The council shall develop and adopt the process that shall be used to review and address complaints. The council shall develop any forms it deems necessary to fulfill it duties. (c) The council shall meet on a quarterly basis, or upon the request of the chair if a meeting is required sooner.Heads-up, 4 times a year ain't enough.
(d) The council shall have the authority to establish and collect fines based on the adopted review process. Said fines shall support the administrative costs of the council.That's nice, let's make money out of this. Look, there is no possible way any such commission can do an adequate job. It is hard enough for the wide-variety of all-volunteer youth sports leagues in this state to deal with the inevitable parental personality clashes--and they're close to the situation and usually know the "personalities" involved. A big, bad "impartial" Commission simply won't get it. This is a complete waste of time for the General Assembly. Don't they have better things to do?
Free Health Care for Legislators
Well, this is "low-hanging" fruit, but it's still fun to hear the reasoning behind why it's a good idea to offer free health-care to part-time legislators. A couple years ago, Speaker Murphy--when faced with a bill that would have legislators pay a portion of their health care--tried to say the state Constitution proscribed anything but free health care for legislators. Last year, a similar effort to require some payment
...sailed through the House easily last year, then ran aground in the Senate with Paiva Weed, who has since made the leap from majority leader to Senate president, saying that she believes “that it should be a voluntary decision. It certainly defeats whatever power of example that they are attempting to demonstrate by mandating it, rather than having it be voluntary.”So...it's not leadership if you are required to do it? Yeah...who ever heard of leadership by example?! Now, this year, they're trying again in the House, with two bills, which both call for a percentage co-share. Whatever. How about just killing the whole benefit? I know, I know...as if. But we can dream.
Re: By Virtual Campaign Announcement, I Think He Means the Real Announcement of a Virtual Campaign, and Not the Virtual Announcement of a Real Campaign...
Further to Andrew's post, a couple of questions pose themselves for virtual gubernatorial candidate Bob Walsh and his
progressive, pro-public education, pro-labor, pro-job creation and economic development, pro-choice, pro-environment, pro-marriage equality, and supportive of a fair tax policy for our state
perspective.
1.) Does he agree with the NEA's Resolution D-20, passed in 2007, which opposes student achievement as a measure of teacher competency/effectiveness?
The Association also believes that the use of student achievement measures such as standardized test scores or grades to determine the competency, quality, or effectiveness of any professional educator is inappropriate and is not a valid measure.
2.) In his prior post as the Superintendent of schools in Chicago, President Obama's new Secretary of Education, Arne Duncan, implemented a level of merit-pay incentives for teachers, closed down failing schools, replaced entire school staffs and rejected the blame the parent/blame the child mentality. In view of Rhode Island's academic achievement ranking (forty first out of fifty), would the virtual candidate advocate that Rhode Island implement some of these approaches - in particular, merit pay - and philosophies?
To quote Matt Jerzyk in these circumstances: "Thank you".
Russian Rulers "Encouraged" by the New Tone
I'm sure they are:
President Obama said yesterday that he had told Russia that reducing Iran's pursuit of a nuclear weapon would in turn lessen the need for a U.S.-planned missile-defense system in Eastern Europe that Moscow has opposed. But Obama said he sought no "quid pro quo" with Moscow.Obama also said it was time for the United States to "reset or reboot" its relationship with Russia, a nod to the increasingly tense relations of recent years. ...
Medvedev reaffirmed strong opposition to the Bush administration's plan to deploy a battery of missile interceptors in Poland and a related radar in the Czech Republic. He said the move would hurt security in Europe.
Medvedev said Russia was encouraged by the Obama administration's readiness to discuss Moscow's complaints.
"Our American partners are ready to discuss this problem, and that's already positive," he said. "Several months ago we were hearing different signals: 'The decision has been made, there is nothing to discuss, we will do what we have decided to do.' Now I hope the situation is different."
Yes, now only one side is going to be saying that discussion is futile on such matters as the nuclear armament of Middle Eastern theocracies.
I hope liberals will be paying attention over the next few years and decades. They're about to see their policies tested for better or worse. I predict worse.
ADDENDUM:
Charles Krauthammer is even more critical.
Riding the buyers' remorse train on day 44 of Obama's presidency
Now Silicon Valley entrepreneurs see their incentives are being altered for the worse:
Like the college students who stayed up late to be inspired by his campaign rallies only to find Obama's first significant action to be a stimulus program that will transfer about a trillion dollars from them to the Baby Boomers, Silicon Valley Obama supporters are likely to find that a government-dominated economic era will not a great one in which to start companies that threaten big incumbent corporations that have juice with the government. I hope they appreciate the irony.
More here on entrepreneurs in general from the ever-thoughtful Jim Manzi. How do statists like Obama think jobs are created?
Whose next on the Obama buyers' remorse train?
Will it matter enough to force changes in Obama's radical agenda?
ADDENDUM
Democratic Senator Evan Bayh writes in the Wall Street Journal:
...Our nation's current fiscal imbalance is unprecedented, unsustainable and, if unaddressed, a major threat to our currency and our economic vitality. The national debt now exceeds $10 trillion. This is almost double what it was just eight years ago, and the debt is growing at a rate of about $1 million a minute.Washington borrows from foreign creditors to fund its profligacy. The amount of U.S. debt held by countries such as China and Japan is at a historic high, with foreign investors holding half of America's publicly held debt. This dependence raises the specter that other nations will be able to influence our policies in ways antithetical to American interests. The more of our debt that foreign governments control, the more leverage they have on issues like trade, currency and national security. Massive debts owed to foreign creditors weaken our global influence, and threaten high inflation and steep tax increases for our children and grandchildren.
The solution going forward is to stop wasteful spending before it starts. Families and businesses are tightening their belts to make ends meet -- and Washington should too.
The omnibus debate is not merely a battle over last year's unfinished business, but the first indication of how we will shape our fiscal future. Spending should be held in check before taxes are raised, even on the wealthy. Most people are willing to do their duty by paying taxes, but they want to know that their money is going toward important priorities and won't be wasted...
...But what ultimately matters are not meetings or words, but actions. Those who vote for the omnibus this week -- after standing with the president and pledging to slice our deficit in half last week -- jeopardize their credibility.
As Indiana's governor, I balanced eight budgets, never raised taxes, and left the largest surplus in state history. It wasn't always easy. Cuts had to be made and some initiatives deferred. Occasionally I had to say "no."
But the bloated omnibus requires sacrifice from no one, least of all the government. It only exacerbates the problem and hastens the day of reckoning. Voters rightly demanded change in November's election, but this approach to spending represents business as usual in Washington, not the voters' mandate...
More on 14 centrist Democratic Senators from Politico.
Jennifer Rubin comments:
Barack Obama’s lurch to the left is costing him some support among centrist pundits, but now he’s lost a prominent Democratic Senator, Evan Bayh....Bayh and Nelson both pushed back against the idea of raising taxes in a recession. Presumably there are more legislators who are not ready for this lurch to the left.
This is potentially a turning point, as Democrats step forward willing to say, "Enough!" Whether they succeed in dragging the president back to a more centrist and sensible agenda remains to be seen. But one thing is clear: the center, at least in the Senate, is closer to the Republicans than to the Obama administration when it comes to fiscal sobriety and taxation.
Want the definition of overreach? When even Maureen Dowd whines about Obama. LOL.
DOMA Was Never a Protector of Compromise
Back in the pre-Goodridge days, when those on either side of the same-sex marriage issue would have extensive debates on the merits of arguments, many on the pro-SSM side (notably Andrew Sullivan) argued that the Defense of Marriage Act would prevent a state judiciary from forcing nationalization of same-sex marriage. The traditionalist side pointed out that the arguments that were being made for SSM would be targeted directly at that legislation, and they've now been proven correct:
Now Ritchie, Bush and more than a dozen others are suing the federal government, claiming the act discriminates against gay couples and is unconstitutional because it denies them access to federal benefits that other married couples receive, such as pensions and health insurance. Plaintiffs also include Dean Hara, the widower of former U.S. Rep. Gerry Studds, the first openly gay member of the House of Representatives.
Yes, the "new lawsuit challenges only the portion of the law that prevents the federal government from affording Social Security and other benefits to same-sex couples," but "President Barack Obama has pledged to work to repeal DOMA." In any case, homosexuals from any state would be able to be married in the eyes of the federal government by acquiring the license in a state that offers it.
As I've been saying, the meaning of marriage is the key issue, here. That's why Rhody misses the mark when he comments, elsewhere, that "we can all agree we want to encourage the establishment of the family unit, which is definitely a conservative goal." The point is that a marital household, husband, wife, and (implicitly) their children should be a structure receiving especial encouragement. If there are no gradations to families — if they're all uniformly founded in the revocable choices between adults — then procreative pairs have no additional cultural motivation to see the possibility of having children as a change in the status of their relationship.
There's an ad for Blue Cross/Blue Shield in today's Providence Journal of a man and woman looking at sonograms. "You're a couple, but, you're about to be so much more," reads the caption. That "so much more" should be tied into the culture of marriage, and the main targets of its message should be couples that can become "so much more" even when they don't particularly want to.
March 3, 2009
Re: Could it be? Part III
The key point from the original post:
Incentives matter deeply and drive human behavior. It is a lesson statists and socialists never learn.
You want real world examples? Read this. My two favorite ones:
First:
I have a few thoughts concerning your Corner post titled Bracketology. My wife and I are both Pediatricians. We own our own practice together. We have one PA and 7 other employees. We each gross about $200K a year. We have 3 young children at home, 2 of which are not in school. We also employ an in home Nanny. My wife has been torn for years about not being at home for these children, which are our biggest investment in the future. We operate parallel S corperations as PC's, with a 50/50 ownership of the LLC that is our business. We file taxes jointly. After crunching some numbers concerning the President's tax hike proposals, I have come to the following conclusions. If the President's plan is [e]nacted, we will do the following:1. My wife will become a stay at home mother.
2. At least 3 of my 7 employees will be released.
3. The practice will downsize to a smaller office space, i.e. less rent.
4. The number of patients cared for on a daily basis will drop by 40%.
5. My wife will come out of the forced ER call schedule for good.
6. I will gross $249,999.00 a year, exactly.
7. The net income of our personal home will decrease by less than $10 K a year from where it would have been if we changed nothing.
Second:
Reagan used to tell the story about how when he was a movie actor he'd make 2 pictures a year, which would take maybe 8-9 months, then lay on the beach for the rest of the year. The reason was by the end of the second picture he was in the 90% tax bracket, and it wasn't worth all that effort to get another 10 cents on the dollar.It didn't hurt him, he said, as he made plenty of money anyway. But what it meant is that the cameramen, set designers, sound people, etc had to go out and look for part time work the rest of the year.
This experience was a primary factor in leading him to advocate lower marginal rates for top income earners. It helped average income earners too.
Some of us are old enough to remember the real-world folly of socialism. The collateral damage across the society is huge.
Guess some people are going to have to re-learn some timeless lessons. How many innocent people will suffer in the meantime, though?
ADDENDUM
Here is something for those who think we at Anchor Rising are being too rough on the Messiah. More here, too. Geez, whodathunk people would ever go that far to redistribute wealth? LOL.
Meanwhile, Malkin links to several good posts on the subject.
Come on now, just go buy stocks. After all, he says they are such a bargain now.
ADDENDUM 2
Here is more from (former Obama supporter) Cramer.
Instapundit links to thoughts about some bigger issues.
ADDENDUM 3
See below the line for Ledeen's interpretation of how de Tocqueville would see current events:
...Most of us imagine the transformation of a free society to a tyrannical state in Hollywood terms, as a melodramatic act of violence like a military coup or an armed insurrection. Tocqueville knows better. He foresees a slow death of freedom. The power of the centralized government will gradually expand, meddling in every area of our lives until, like a lobster in a slowly heated pot, we are cooked without ever realizing what has happened. The ultimate horror of Tocqueville’s vision is that we will welcome it, and even convince ourselves that we control it.There is no single dramatic event in Tocqueville’s scenario, no storming of the Bastille, no assault on the Winter Palace, no March on Rome, no Kristallnacht. We are to be immobilized, Gulliver-like, by myriad rules and regulations, annoying little restrictions that become more and more binding until they eventually paralyze us...
Tocqueville describes the new tyranny as “an immense and tutelary power,” and its task is to watch over us all, and regulate every aspect of our lives.
It covers the surface of society with a network of small complicated rules, minute and uniform, through which the most original minds and the most energetic characters cannot penetrate, to rise above the crowd.We will not be bludgeoned into submission; we will be seduced. He foresees the collapse of American democracy as the end result of two parallel developments that ultimately render us meekly subservient to an enlarged bureaucratic power: the corruption of our character, and the emergence of a vast welfare state that manages all the details of our lives. His words are precisely the ones that best describe out current crisis:
That power is absolute, minute, regular, provident and mild. It would be like the authority of a parent if, like that authority, its object was to prepare men for manhood; but it seeks, on the contrary, to keep them in perpetual childhood: it is well content that the people should rejoice, provided they think of nothing but rejoicing. For their happiness such a government willingly labors, but it chooses to be the sole agent and the only arbiter of that happiness; it provides for their security, foresees and supplies their necessities, facilitates their pleasures, manages their principal concerns, directs their industry, regulates the descent of property, and subdivides their inheritances: what remains, but to spare them all the care of thinking and all the trouble of living?The metaphor of a parent maintaining perpetual control over his child is the language of contemporary American politics. All manner of new governmental powers are justified in the name of "the children," from enhanced regulation of communications to special punishments for "hate speech;" from the empowerment of social service institutions to crack down on parents who try to discipline their children, to the mammoth expansion of sexual quotas from university athletic programs to private businesses. Tocqueville particularly abhors such new governmental powers because they are Federal, emanating from Washington, not from local governments. He reminds us that when the central government asserts its authority over states and communities, a tyrannical shadow lurks just behind. So long as local governments are strong, he says, even tyrannical laws can be mitigated by moderate enforcement at the local level, but once the central government takes control of the entire structure, our liberties are at grave risk...
It is evident that our associations, along with religion one of the two keys to the great success of the American experiment, are prime targets for the appetite of the state. In the seamless web created by the new tyranny, everything from the Boy Scouts to smoking clubs will be strictly regulated. It is no accident that the campaign to drive religion out of American public life began in the 1940s, when the government was consolidating its unprecedented expansion during the Depression and the Second World War, having asserted its control over a wide range of activities that had previously been entrusted to the judgment of private groups and individuals.
When we console ourselves with the thought that the government is, after all, doing it for a good reason and to accomplish a worthy objective, we unwittingly turn up the temperature under our lobster-pot. The road to the Faustian Deal is paved with the finest intentions, but the last stop is the ruin of our soul.
Permitting the central government to assume our proper responsibilities is not merely a transfer of power from us to them; it does grave damage to our spirit. It subverts our national character. In Tocqueville’s elegant construction, it "renders the exercise of the free agency of man less useful and less frequent; it circumscribes the will within a narrower range and gradually robs a man of all the uses of himself." Once we go over the edge toward the pursuit of material wealth, our energies uncoil, and we become meek, quiescent and flaccid in the defense of freedom.
The will of man is not shattered, but softened, bent, and guided; men are seldom forced by it to act, but they are constantly restrained from acting. Such a power does not destroy, but it prevents existence; it does not tyrannize, but it compresses, enervates, extinguishes, and stupefies a people, till each nation is reduced to nothing better than a flock of timid and industrious animals, of which the government is the shepherd.The devilish genius of this form of tyranny is that it looks and even acts democratic. We still elect our representatives, and they still ask us for our support. "…servitude of the regular, quiet, and gentle kind…might be combined with some of the outward forms of freedom, and…might even establish itself under the wing of the sovereignty of the people." Freedom is smothered without touching the institutions of political democracy. We act out democratic skits while submitting to an oppressive central power that we ourselves have chosen.
...The great Israeli historian Jacob Talmon coined the perfect name for this perversion of the Enlightenment dream, which enslaves all in the name of all: totalitarian democracy.
These extreme cases help us understand Tocqueville’s brilliant warning that equality is not a defense against tyranny, but an open invitation to ambitious and cunning leaders who enlist our support in depriving ourselves of freedom. He summarizes it in two sentences that should be memorized by every American who cherishes freedom:
The…sole condition required in order to succeed in centralizing the supreme power in a democratic community is to love equality, or to get men to believe you love it. Thus the science of despotism, which was once so complex, is simplified, and reduced, as it were, to a single principle.As I said last time, we’re in for a hell of a fight. Or so I hope.
Re: Could it be?
So when President Obama says that…
Profit and earning ratios are starting to get to the point where buying stocks is a potentially good deal…if you’ve got a long-term perspective on it.…isn’t he basically saying that…
The fundamentals of our economy are strong.Those who were critical of the attitude expressed in the second statement should feel free to reiterate their concerns about leaders who really don't understand economics, in response to the first. That is, if their criticism was ever about substance.
Obama Versus Tax Dodgers
President Obama is going to go after international tax dodgers (h/t):
President Barack Obama's Treasury secretary says the administration will unveil a series of rules and measures in the coming months to limit the ability of international companies to avoid U.S. taxes.Unless of course they are nominated for a Cabinet position.Treasury Secretary Timothy Geithner told the House Ways and Means Committee on Tuesday that Obama will propose legislation to limit U.S. companies' ability to shelter foreign earnings from taxation in the U.S. He also said the administration will try to limit wealthy Americans' ability to use tax havens to avoid taxation.
Democracy and Opportunity: Ridiculously Wasteful!
I'm just guessing, here, but I'd bet that a survey of people who lament "suburban sprawl" would find that most either prefer city life or have the money to carve out their own, untouchable little pieces of the country. Probably a mixture of both sentiments went into this Providence Journal editorial:
America's ridiculously wasteful lifestyle — often referred to as suburban sprawl — proves that freedom has never been free.In most societies, even in the wealthiest European states, many in the lower, middle and upper classes live in apartments. Far more workers than here take the bus or train to work. (Mass transit is a big deal in Europe. Actually, before the '60s, it was a pretty big deal in large parts of urban America, too.) ...
The president may underestimate the extent to which dreams die hard. The American Dream is a house surrounded by enough grass to choke a z-turn riding mower. That lifestyle has a lot of lobbyists working on its behalf in Washington. Nobody expects the dream to shrink to the size of an apartment, but why not promote more walkable communities of a bit higher density arrayed along bus or light-rail lines?
It's really not difficult to see where this will go (assuming the Projo is talking about government coercion and not suggesting a lead for private industry): These socially engineered communities will turn out to be more expensive than expected, in one way or another, because they will have to be subsidized in order to attract inhabitants (whether by directly funding their housing or by keeping the cost of amenities, such as stores, artificially low), and in any case, they will not be residents' visions of their ideal housing.
Those from the upper class, of course, will still manage to live as they like, but the rest of us will not be able to trade up toward our aspirations as we're able; we'll have to loiter in "a bit higher density" neighborhoods than we want until we manage to make the leap. (More likely, we'll just have to imagine that we'll one day be able to make the leap.)
I know it's emotionally very difficult for those of a certain mindset to accept, but people will seek what they want, and attempting to force them into something else doesn't generally work out well for anybody but the powerful.
Breaking News out of the North: Mayor Menard Will Not Seek Reelection
At 8:20 this morning on WNRI's Up Front program, Mayor Susan Menard announced that she would not seek re-election.
She gave no reason; she simply made the statement "out of the clear blue sky" and "with finality", as WNRI co-owner Richard Bouchard, filling in for Dave Kane, later described her announcement.
ADDENDUM
Commenter Patrick suggests a potential campaign philosophy for the upcoming mayoral election. We should note that Woonsocket holds its local elections in off years. Therefore, the primary for both city council and mayor's office will take place this October and the general will be held in November; declaration papers will be available in August.
Ladies and gentlemen, start your engines.
Sgouros's Answer Is Big Government
Tom Sgouros likes the idea of centralized government. (He also knows just how to run it, it seems, at least better than a growing list of his fellow citizens, including our "absurd[ly] scolding" governor and the "blind squirrels" who advocate for consolidation.) In a recent column with the aim of supporting that affinity, he attempts to move his cups fast enough that readers won't notice a critical omission and a hint of his end goal.
His argument is that diffuse government, financed with local taxes, is a financial trap in a mobile society:
When people leave a town, it takes a while to cut the expenses of the services they used, if it's possible at all. If you have a hundred kids in a fifth grade, that's four classrooms. If ten of those children move away, that's still four classrooms, but with less money to pay for them. If a fire station is established to deal with a neighborhood of 500 houses, a town can't close it just because 50 of those houses are now vacant. A shrinking town doesn't need a smaller police department. If anything, experience shows it needs a larger one.The opposite side of the coin is just as telling. A family with two school-age children moving to some rural town will likely cost that town as much as $30,000 in services, but provide only a fraction of that in taxes. New construction often requires new traffic lights, new water lines, new sewer lines and more. These expenses are never covered by the new tax revenue, and seldom even covered by occasionally imposed "developer impact fees."
He touts a study of the school district in Fairfax County, Virginia, that he's performed, but he neglects to offer any evidence that Fairfax is worthy of emulation or to explain what about that system would benefit Rhode Island. Sgouros points out that the cost of government of Jamestown (for example) has corresponded with a growth in population:
Town payrolls have gone up because towns have grown, and because of requirements imposed on them. Jamestown has twice as many year-round residents, and many more summer houses, than it did back in the days of two police cars. Rhode Island has about the same number of people as a generation ago, but our little towns are bigger and our cities are smaller. We have spread out across the landscape, and that has real consequences.
But do you see the spending of the cities contracting, or their leaders asking the state for less money? To quote Sgouros's arrogant tone: "Yeah, neither do I."
His hypothetical shrinking town is still going require four classrooms, and the rural town is still going to face the necessity of expanding its services; the former is still going to have to keep up unneeded water and sewer lines, and the latter is still going to have to install new ones. The only difference is that the ever-expanding cost of government — notably including the cost of Sgouros's union friends — would occur a little bit farther beyond the political reach of regular citizens.
Actually, that's not the only difference. It would also be a little bit easier for those with an affection for central planning and top-down dictation to implement their preferences. Writes Sgouros:
Want to know what else Jamestown has that it didn't have a generation ago? Special-ed students who used to be wards of the state, attending the Ladd School. Having special-needs children educated with other children is a good thing, but it's not free. When the state closed Ladd, do you remember how the state gave that money to cities and towns for special education? Yeah, neither do I.What else didn't Jamestown have back then? Clean-water mandates imposed by the EPA, comprehensive planning laws, bus monitors on school buses, and yes, minimum staffing levels in public safety departments, imposed by the state. Here's the thing, though: all of these requirements were imposed for a good reason. Clean water, good planning, and public safety are all important.
One wonders what else Mr. Sgouros believes should be "imposed for a good reason." Centralized government is most successfully a mechanism for enabling a class of people who believe that they're smarter and more moral than the rest of us to tell their fellow citizens how to live. In the short term, it also serves to obfuscate the unsustainable costs of their policies.
Could it be?
The conventional wisdom is that Obama, with strong majorities in both houses of Congress, will get every legislative initiative he wants. And from a sheer vote counting viewpoint, that would certainly be true.
But could the countervailing force not be the oft-spineless Republicans with their limited votes in Congress?
Could the real counter come from the financial markets themselves, which sense both the magnitude of the economic downturn and how Obama's proposed statist solutions will only compound the problems and adversely impact any recovery?
Consider this stock trend.
So is it a race between a financial market collapse, accelerated by its reaction to Obama's policy proposals, and Obama's aggressive and statist policy implementation effort?
Will the financial markets then be the force which galvanizes a broad reaction from the American people? Remember, the last time we had a downturn this deep was at the beginning of the 1980's and 401(k)'s weren't in place yet so the average American had far less at stake financially.
(The underlying philosophical issues on why Obama's policies are wrong are here.)
And, if you don't think the American people are beginning to pick up on it, read further down the earlier link and consider how rapidly the idea of going-John-Galt has spread.
Incentives matter deeply and drive human behavior. It is a lesson statists and socialists never learn.
It's all enough to make you shrug, isn't it?
ADDENDUM
Will Wilkinson reflects on Obama's dilemma, which some of us believe is being reflected in the declining stock market prices:
The upshot is that if you want to reduce inequality through redistribution, tax progressivity barely helps. You need to take a huge chunk of GDP in taxes in order to finance progressive spending. The more general, sort of obvious point is that if you want to massively increase government spending, the government needs a lot more revenue. But you can take everything from the rich and you still won’t have enough. So you’ve got to massively increase taxation on the middle class. The best way to do this is through a consumption tax. But Obama keeps reinforcing, again and again, that middle-class tax rates won’t rise, as if this is itself a matter of justice. So where’s all the money going to come from to do all these amazing things? Eventually, it’s a huge increase in taxes for the middle class or nothing. This may not be a big political winner.The progressivity of the American tax system puts big-spending progressives in a bind. They should want a consumption tax with a huge, wide base. The easiest way for government to devour ever-larger chunks of economic output is through the device of a slow series of very small rate increases on a broad base. The smaller the tax base, the more dramatically you have to hike rates in order to significantly increase revenue. But dramatically hiking rates tends to discourage political buy-in from those who must pay. Indeed, it tends to incite heated resistance. Obama did very well with the rich. But that may not last if he hits them as hard as it looks like he’s aiming to. At the very least, pushback from this very powerful bloc of voters will limit his success in raising rates at the top....But even the large [increases on the small tax base] leave him massively short. And government spending cannot be debt-financed forever. And he can only inflate so much of it away.
...Democratic strategists need to be looking at clever ways for the government to take a lot more money away from middle-class families without thereby making the GOP look golden again. Obama’s been behaving as though he’s much less fiscally constrained than he really is. But by catering to the idea that middle-class taxes shouldn’t ever go up, he’s making it even tougher on himself. Unless he’s in the middle of some kind of ten-steps-ahead rope-a-dope wherein reaffirming the middle class’ right to not pay taxes is a way of softening them up to accept huge tax increases, he may be making a mistake.
ADDENDUM 2
Even David Brooks is disillusioned by Obama's proposals:
...But the Obama budget is more than just the sum of its parts. There is, entailed in it, a promiscuous unwillingness to set priorities and accept trade-offs. There is evidence of a party swept up in its own revolutionary fervor — caught up in the self-flattering belief that history has called upon it to solve all problems at once.So programs are piled on top of each other and we wind up with a gargantuan $3.6 trillion budget. We end up with deficits that, when considered realistically, are $1 trillion a year and stretch as far as the eye can see. We end up with an agenda that is unexceptional in its parts but that, when taken as a whole, represents a social-engineering experiment that is entirely new.
The U.S. has never been a society riven by class resentment. Yet the Obama budget is predicated on a class divide. The president issued a read-my-lips pledge that no new burdens will fall on 95 percent of the American people. All the costs will be borne by the rich and all benefits redistributed downward.
The U.S. has always been a decentralized nation, skeptical of top-down planning. Yet, the current administration concentrates enormous power in Washington, while plan after plan emanates from a small group of understaffed experts.
The U.S. has always had vibrant neighborhood associations. But in its very first budget, the Obama administration raises the cost of charitable giving. It punishes civic activism and expands state intervention.
The U.S. has traditionally had a relatively limited central government. But federal spending as a share of G.D.P. is zooming from its modern norm of 20 percent to an unacknowledged level somewhere far beyond...
The first task will be to block the excesses of unchecked liberalism. In the past weeks, Democrats have legislated provisions to dilute welfare reform, restrict the inflow of skilled immigrants and gut a voucher program designed for poor students. It will be up to moderates to raise the alarms against these ideological outrages.
But beyond that, moderates will have to sketch out an alternative vision...This is a vision of a nation that does not try to build prosperity on a foundation of debt. This is a vision that puts competitiveness and growth first, not redistribution first.
Moderates are going to have to try to tamp down the polarizing warfare that is sure to flow from Obama’s über-partisan budget. They will have to face fiscal realities honestly and not base revenue projections on rosy scenarios of a shallow recession and robust growth next year.
They will have to take the economic crisis seriously and not use it as a cue to focus on every other problem under the sun...
Malkin ridicules Brooks here.
ADDENDUM 3
Amateur hour at the White House. Obama thinks a monotonically decreasing price level is a gyration. What a sense of economic insight. Follow the links, especially the WSJ editorial.
More on the budget here.
Meanwhile Jennifer Rubin responds to White House nonsense and includes a quote from investor (and former Obama supporter) Jim Cramer:
Until the Obama administration starts listening, until they start paying attention to what you’re watching, to the stock market, until they realize that their agenda is destroying the life savings of millions of Americans, then all I can give you is caution. … I just want some sign that Obama realizes the market is totally falling apart. And that his agenda has a big hand in that happening.
Marching Toward the Bottom with 10.3% Unemployment
Anyone heard hints of budget and economic-policy progress in the General Assembly? I ask because Rhode Island's unemployment rate is now at 10.3%:
The unemployment rate in January spiked by nearly a full percentage point over the revised December figure of 9.4 percent. It has ballooned by four percentage points since January 2008. (Earlier, the state estimated a 10-percent unemployment rate for December based on a survey of businesses. That rate was recalculated through the annual review of payroll tax filings.)Nationally, unemployment increased to 7.6 percent from 7.2 percent in January. The national rate for February is due on Friday.
Cut taxes (and spending). Erase regulations. Build infrastructure. Standing around in State House back rooms like frozen deer just isn't sufficient.
March 2, 2009
What the Marriage Debate Means to Each Side
With my schedule, I wasn't able to attend this year's hearing at the Statehouse on same-sex marriage. The arguments that I've been making for years still stand, though, and to some extent, I'm not convinced that the battle has much to do with reason, anymore (if it ever did).
The dueling radio ads tell the story behind the debate. The traditionalist side, presented by the National Organization for Marriage, expresses concerns about the significance of cultural confusion when important definitions lose their meaning by putting some questions in the mouths of children. The radical side, voiced by Marriage Equality RI, features a marmish school teacher's voice explaining to her class how utterly obvious a civil rights issue marriage is.
The pro-same-sex-marriage ad is indicative of the mindset of the advocates behind its cause: There are no questions; nothing about the issue is so complicated or sensitive that teachers couldn't set about educating their public-school charges. It's amazing that they apparently don't realize how directly they are contributing to a central concern of their target audience: It isn't that Mike and Steve's wedding will affect any heterosexuals' marriages; it's that an entire worldview — one that has persisted throughout history and across boundaries — will be dismissed and attacked as deprecated bigotry as a matter of law and within our public institutions
Okay, An Even Swap - the Pension Actuaries for the Country Club Tax Records
From Friday's Kent County Times:
On Feb. 19, [State Senator Michael] Pinga requested the tax records of the West Warwick Country Club, which Jim Williamson is co-owner of. Pinga said he did so because “someone,” who he said he would not identify, “notified me that he [Jim Williamson] received a tax abatement and I want to see if he went through the proper procedure.”“I think this is important because everyone else has to go through the procedure and I want to make sure that he did too,” Pinga said.
Senator Pinga may be a tad suspicious that the process was telescoped for Jim Williamson because he is the brother of Timothy Williamson. Mr. Timothy Williamson is both a House Representative and Town Solicitor for West Warwick.
In a separate matter, Timothy Williamson, in his capacity as a House Representative, has repeatedly
refused to make public a letter summarizing the findings of the state-paid [pension] actuaries at Gabriel Roeder Smith & Co., and the methodology they used to arrive at their conclusions.
Why?
Williamson asserted that the letter, which the actuaries had in front of them as they testified at last night’s televised State House meeting, had been written to him personally, in his role as chairman of the commission, and so it was not public.
Written to him "personally"? Hoo, ha! Good one. Sign this man up to write for next year's Follies.
Ya know what? Cancel the swap. Both documents pertain to public monies and public business. Make them both public.
Changing the Rules to Compensate for Falling Political Capital?
State Representative John Loughlin (R-Little Compton/Portsmouth/Tiverton) has an interesting theory, told to today's Political Scene column in the Projo, as to the motivation of the State House's Democratic leadership in seeking to severely limit the range of matters that can be debated on the House floor…
You have to wonder if maybe these rules are so harsh because we have a lame-duck speaker and he realizes it’s the only way he can control the room.”However, in response to earlier mentions of this rumor, Speaker of the House William Murphy has denied having any plans to retire after his current term…
But Murphy bristled at any suggestion that he is a lame duck. “I think it’s a distraction now for anybody to talk about who the future speaker of the House will be in Rhode Island because we do have a speaker right now that was just elected, and in 2011 I look forward to being elected again.”
Hoping Against Hope for Presidential Wisdom
Curious about how conservative Obama fans are getting along, I checked in with the man whose leg the messiah made tingle with knowledge, David Brooks. Here is a guy who reallly, really wants to believe:
If ever this kind of domestic revolution were possible, this is the time and these are the people to do it. The crisis demands a large response. The people around Obama are smart and sober. Their plans are bold but seem supple and chastened by a realistic sensibility.Yet they set off my Burkean alarm bells. I fear that in trying to do everything at once, they will do nothing well. I fear that we have a group of people who haven't even learned to use their new phone system trying to redesign half the U.S. economy. I fear they are going to try to undertake the biggest administrative challenge in American history while refusing to hire the people who can help the most: agency veterans who are registered lobbyists. ...
It'll be interesting to see who's right. But I can't even root for my own vindication. The costs are too high. I have to go to the keyboard each morning hoping Barack Obama is going to prove me wrong.
What'll be interesting is how Brooks and others gauge Obama's success. "If Obama is mostly successful," he writes, "then the epistemological skepticism natural to conservatives will have been discredited." Such judgments have a way of being obscured by the turmoil of government and society.
After the budget speech, for example, Brooks sought to blame political innocence, not a fundamental intellectual misconception, for Obama's willingness to embrace a destructive half-plan for America's future:
The bigger problem is health care. This is an issue where everybody wants benefits they don't pay for, where perverse incentives have created an expensive system that doesn't deliver results. This is an area where aggressive presidential leadership is mandatory.Yet in no other area does the administration cede so much authority. The administration has over-learned the lessons of the Clinton-care fiasco. They're not going to send up a detailed 1,400-page program. Fine. But they're not pushing a plan at all.
Instead, replicating the model that did such harm to the stimulus package, they are merely outlining eight general principles and then sending the matter up to Capitol Hill. They vow to have a series of "conversations" and then presumably at some point some group of committee chairmen will write a bill or a bunch of bills. ...
Even though the budget is not all one would have hoped, I'd trust the folks in the Obama administration to craft a decent health care plan before I'd trust the Congressional Old Bulls. Obama blew a mighty trumpet Tuesday night, but after you blow the trumpet, you actually have to charge.
Perhaps that trust is rooted in a swindle, and the Obama team is ceding authority because it is more concerned with appearances than actions. That is the great flaw of big government philosophy: It moves forward on the assumption that a plan could be created... by somebody... and then fumbles for anything that would maintain the illusion, because no concrete proposal will actually work. The upshot is that the powerful manipulate the new well of money and influence while the general public suffers.
Westerly School Committee Brings in a Professional
On August 31, the contract between the Westerly Teachers’ Association and the Town of Westerly expires. The Westerly School Committee has already lined up a professional negotiator to assist them with the new contract. From yesterday's Westerly Sun:
After seeking requests for proposals for an outside negotiator, the School Committee received responses from five applicants and interviewed two candidates in executive session in early January.The board held subsequent discussions behind closed doors and, on Wednesday, voted in open session to hire [Attorney Daniel] Kinder, whose usual hourly rate is $350, according to Murano.
Mr. Kinder, whose list of clients currently includes the East Providence School Committee, has cut his hourly rate to $195.
Too often in Rhode Island, especially over the last couple of decades, school committees have chosen not to seek the assistance of a professional at contract time. This is reflected in the contrast of the national ranking of Rhode Island teacher salaries,
ninth highest in 2007/2008 (source: National Education Association)
to our academic achievement ranking,
forty first in 2007 (source: the American Legislative Exchange Council)
Warwick City Council Approves Contract
To no one's surprise, the Warwick City Council passed contract extensions with the City's fire, police and municipal workers on Friday.
The extended contracts, which will run through June 30, 2012, were approved on votes of 7 to 2, with council members Joseph J. Solomon and Steve Merolla dissenting.The details of the deal are the same as what I've detailed already, so nothing new there.Council members who favored the new labor agreements cited not only savings, but the fact that the unions’ willingness to negotiate spared Warwick the strife and legal wrangling being seen in other communities struggling with dwindling resources.
“This was reasonable men and women making reasonable decisions at a very difficult time for this city,” council President Bruce S. Place said in an interview Saturday.
I was able to attend the early part of the meeting and it went about as expected. The general feeling was that the city employees had come to the rescue of the city because of these tough times. There was a lot of verbal back-slapping as the three union heads got up to speak and all were met with generous applause from the crowd, which was 90-95% city workers.
A few Warwick taxpayers did get up to speak, and the two primary concerns were:
1) The wisdom of doing a long term deal in these tough times, when no one can forecast what's going to happen.
2) A set dollar amount for health care co-share's versus a percentage.
As to the former, Mayor Avedesian explained that a long term deal allows them to more accurately project their costs. Councilman Joseph Solomon countered this line of argument:
Solomon said he voted against the extended contracts because he does not feel it is wise for the city to lock itself into specific benefit language when there are so many financial unknowns and the fiscal pictures for all cities and towns is changing so radically from year to year.As to the health care provision, Mayor Avedesian explained that his Administration's analysis indicated that--because Warwick is self-insured and that co-share payments are largely affected by the management costs--the city will actually do better thanks to increased competition (Blue Cross/Blue Shield, United Health and now Tufts) for health care services. The City's health care contract expires and is going out to bid shortly (if it hasn't already).“I could have maybe seen one-year extensions … but I did not want to mortgage our taxpayers long term,” Solomon said after Friday night’s meeting. “Our taxpayers simply cannot afford any more tax increases, and though I appreciate the hard work of our employees, I think we need to look at our current fiscal situation and not too far out into the future.”
...Like Solomon, Merolla said the new contracts obligate the city too far down the road, particularly when it is considered that labor costs account for about 85 percent of the city budget. “What we’ve done is lock in 85 percent of our budgets at a time when the city hasn’t set aside any money to pave roads and our bond money is frozen,” he said. “This vote is more important than any one budget vote.”
Still, banking on that seems like a bit of a gamble when simply shifting from a set dollar amount to a percentage would be a more financially sound solution for the long term. The Mayor also restated that the Legislature is discussing the 25% statewide co-pay and clarified that any such measure would be applied to all contracts negotiated after January 1, 2009 (at least for now--hey, we can have faith in the GA, right?).
In the end, while there is much to be said for the spirit of cooperation that embodied these contract talks, there was still too much left on the table by the City, especially considering the length of the deals. Yet, even then, there still seems to be little stomach for fundamentally changing the nature of these contracts--such as getting away from their hidden step/longevity increases--much less with dealing with pension reform. We continue to muddle along.
Rhode Island Should Fear a National Recovery, and Get Moving
At least since October, I have been suggesting that Rhode Island's status as a business-unfriendly economic pit will make it more difficult for our economy to recover along with the nation's. Current policies have been driving out the "productive class" for years, and not only is this the critical demographic for economic recovery, but it consists of people who are able and willing (perhaps reluctantly) to move in search of opportunity. If Rhode Island lags the nation in supplying that opportunity, it will be attempting to gain its economic footing from the bottom of a landslide.
Benjamin Gedan's article on the front page of yesterday's Providence Journal provides the first hint that the mainstream of Rhode Island society is beginning to catch on:
... the bible-length list of boarded-up storefronts is arguably more alarming. Vanishing companies increase unemployment, reduce corporate spending that supports suppliers and vendors, and deprive government of desperately needed tax revenue in a state struggling to erase a $357-million budget deficit.Perhaps more worryingly, the exodus [of small businesses] jeopardizes the state's prospects for a quick recovery when economic activity elsewhere in the country finally picks up. Starting a new business requires financing, planning and building that delay job creation.
"The longer the recession lasts, the more businesses go under and the longer the recovery will take afterwards," Andres Carbacho-Burgos, an economist for Moody's Economy.com, said. "The recovery will be slower and more tentative."
In a static world, government leaders could approach that conclusion with tentative policies, but we live in a dynamic society. Consequently, one must adjust this factor...
Some economists, meanwhile, say there is reason to believe many businesses could be reborn as swiftly as they toppled."You're going to get new businesses forming," Robert Tannenwald, vice president at the Federal Reserve Bank of Boston, said in an interview. "Capital is a lot more mobile than it used to be. Entrepreneurship is at a much greater level than it was 20, 30 or 40 years ago."
... to account for human agency. Capital and markets will appear beyond our state borders before they are sighted within, and few entrepreneurs will care to wait for opportunity to break through the Bristol Wall.
What Rhode Island must do is move quickly to realign policies to make our state the first to see investment and the creation of new businesses. This means (as I've been repeating like a mantra), slashing government spending and taxes, combing (like lice) all excessive and annoying regulations and licensing out of state law, and redirecting all available funds to infrastructure.
Considering that the General Assembly seems mired in a delusional hope that residents will just forget that there's currently a supplemental budget sitting around awaiting approval, while the state spends more than a million dollars per day that it doesn't have, the possibility is slim that our legislators have the guts and brainpower to position Rhode Island to lead the nation out of recession, as we led it into recession. But the governor, the GOP, and all like-minded independents and moderates should take up the call now and declare it unwaveringly to ensure that the Democrats and progressives bear the consequences of their stupidity and cowardice.
Liberty & the proper role of government in a free society
Obama's budget proposal presents plans which run radically counter to the proper role of government if America is to remain a free society:
...The widespread use of the market reduces the strain on the social fabric by rendering conformity unnecessary with respect to any activities it encompasses. The wider the range of activities covered by the market, the fewer are the issues on which explicitly political decisions are required and hence on which it is necessary to achieve agreement. In turn, the fewer the issues on which agreement is necessary, the greater is the likelihood of getting agreement while maintaining a free society....a good society requires that its members agree on the general conditions that will govern relations among them, on some means of arbitrating different interpretations of these conditions, and on some device for enforcing compliance with the generally accepted rules...most of the general conditions are the unintended outcome of custom, accepted unthinkingly...no set of rules can prevail unless most participants most of the time conform to them without external sanctions...But we cannot rely on custom or on this consensus alone to interpret and to enforce the rules; we need an umpire. These then are the basic roles of government in a free society: to provide a means whereby we can modify rules, to mediate differences among us on the meaning of the rules, and to enforce compliance with the rules on the part of those few who would otherwise not play in the game.
...the organization of economic activity through voluntary exchange presumes that we have provided, through government, for the maintenance of law and order to prevent coercion of one individual by another, the enforcement of contracts voluntarily entered into, the definition of the meaning of property rights, the interpretation and enforcement of such rights, and the provision of a monetary system.
The role of government just considered is to do something that the market cannot do for itself, namely, to determine, arbitrate, and enforce the rules of the game...
Earlier posts here and here discuss what combination of economic freedom and limited government enables liberty for us:
...How can we benefit from the promise of government while avoiding the threat to freedom? Two broad principles embodied in our Constitution give an answer...First, the scope of government must be limited. Its major function must be to protect our freedom both from the enemies outside our gates and from our fellow-citizens: to preserve law and order, to enforce private contracts, to foster competitive markets...By relying primarily on voluntary co-operation and private enterprise, in both economic and other activities, we can insure that the private sector is a check on the powers of the governmental sector...
The second broad principle is that government power must be dispersed...If government is to exercise power, better in the county than in the state, better in the state than in Washington. If I do not like what my local community does...I can move to another local community, and though few may take this step, the mere possibility acts as a check...If I do not like what Washington imposes, I have few alternatives in this world of jealous nations...
...The power to do good is also the power to do harm; those who control the power today may not tomorrow; and, more important, what one man regards as good, another may regard as harm...
The preservation of freedom is the protective reason for limiting and decentralizing governmental power. But there is also a constructive reason. The great advances of civilization...have never come from centralized government...
Government can never duplicate the variety and diversity of individual action...
It is widely believed that politics and economics are separate and largely unconnected; that individual freedom is a political problem and material welfare an economic problem...such a view is a delusion...
Economic arrangements play a dual role in the promotion of a free society. On the one hand, freedom in economic arrangements is itself a component of freedom broadly understood, so economic freedom is an end in itself. In the second place, economic freedom is also an indispensible means toward the achievement of political freedom...
Viewed as a means to the end of political freedom, economic arrangements are important because of their effect on the concentration or dispersion of power...competitive capitalism also promotes political freedom because it separates economic power from political power and in this way enables the one to offset the other...
Because we live in a largely free society, we tend to forget how limited is the span of time and the part of the globe for which there has ever been anything like political freedom: the typical state of mankind is tyranny, servitude, and misery. The nineteenth century and early twentieth century in the Western world stand out as striking exceptions to the general trend of historical development. Political freedom in this instance clearly came along with the free market and the development of capitalist institutions...
History suggests only that capitalism is a necessary condition for political freedom. Clearly it is not a sufficient condition...
The relation between political and economic freedom is complex and by no means unilateral...
As [nineteenth-century, not twentieth-century] liberals, we take freedom of the individual, or perhaps the family, as our ultimate goal in judging social arrangements. Freedom as a value in this sense has to do with the interrelationship between people...in a society freedom has nothing to say about what an individual does with his freedom; it is not an all-embracing ethic...a major aim of the liberal is to leave the ethical problem for the individual to wrestle with. The "really" important ethical problems are those that face an individual in a free society - what he should do with his freedom. There are thus two sets of values that a liberal will emphasize - the values that are relevant to relations among people, which is the context in which he assigns first priority to freedom; and the values that are relevant to the individual in the exercise of his freedom, which is the realm of individual ethics and philosophy.
The liberal conceives of men as imperfect human beings. He regards the problem of social organizations to be as much a negative problem of preventing "bad" people from doing harm as of enabling "good" people to do good...
Fundamentally, there are only two ways of co-ordinating the economic activities of millions. One is central direction involving the use of coercion - the technique of the army and of the modern totalitarian state. The other is voluntary co-operation of individuals - the technique of the market place.
The possibility of co-ordination through voluntary co-operation rests on the elementary - yet frequently denied - proposition that both parties to an economic transaction benefit from it, provided the transaction is bi-laterally voluntary and informed.
Exchange can therefore bring about co-ordination without coercion...
...Political freedom means the absence of coercion of a man by his fellow men. The fundamental threat to freedom is power to coerce...The preservation of freedom requires the elimination of such concentration of power to the fullest extent and the dispersal and distribution of whatever power cannot be eliminated - a system of checks and balances. By removing the organization of economic activity from the control of political authority, the market eliminates this source of coercive power. It enables economic strength to be a check to political power rather than a reinforcement.
Economic power can be widely dispersed...Political power, on the other hand, is more difficult to decentralize...if economic power is joined to political power, concentration seems almost inevitable. On the other hand, if economic power is kept in separate hands from political power, it can serve as a check and a counter to political power...
Obama's budget proposal also runs counter to the philosophical principles underlying the American Founding.
March 1, 2009
While on the Topic of Pining (a Little Revivification)
If you've got ten minutes, it might do your patriotic spirit good to watch a couple snips of speeches from opposite ends of Ronald Reagan's political career:
- The first I came across while perusing Prof. Jacobson's blog: "Those who would trade our freedom for the soup kitchen of the welfare state have told us they have a utopian solution of peace without victory; they call their policy 'accommodation,' and they say that if we'll only avoid any direct confrontation with the enemy, he'll forget his evil ways and learn to love us."
- The second is presented on Ocean State Republican as an answer to Obama's supporters: "All great change in America begins at the dinner table, so tonight in the kitchen, I hope the talking begins. And children, if your parents haven't been teaching you what it means to be an American, let 'em know and nail 'em on it. That would be a very American thing to do."
It's tempting to bemoan that "they don't make 'em like Reagan anymore," but they do. We just have to find them — and support them.
The radical implications of Obama's budget proposal
Commentators on the evolving Obama presidency:
Charles Krauthammer: Obama proposes a European U.S.
Not a great speech, but extremely consequential. If Barack Obama succeeds, his joint address to Congress will be seen as historic -- indeed as the foundational document of Obamaism. As it stands, it constitutes the boldest social democratic manifesto ever issued by a U.S. president......The economic crisis is to Obama a technocratic puzzle that needs to be solved because otherwise he loses all popular support.
Unlike most presidents, however, he doesn't covet popular support for its own sake. Some men become president to be someone, others to do something. This is what separates, say, a Ronald Reagan from a Bill Clinton. Obama, who once noted that Reagan altered the trajectory of America as Clinton had not, sees himself a Reagan.
...Obama made clear Tuesday night that he intends to be equally transformative. His three goals: universal health care, universal education, and a new green energy economy highly funded and regulated by government.
(1) Obama wants to be to universal health care what Lyndon Johnson was to Medicare...
...Obama will create the middle step that will lead ultimately and inevitably to single-payer. The way to do it is to establish a reformed system that retains a private health-insurance sector but offers a new government-run plan (based on benefits open to members of Congress) so relatively attractive that people voluntarily move out of the private sector, thereby starving it. The ultimate result is a system of fully socialized medicine. This will likely not happen until long after Obama leaves office. But he will be rightly recognized as its father.
(2) Beyond cradle-to-grave health care, Obama wants cradle-to-cubicle education. He wants far more government grants, tax credits and other financial guarantees for college education -- another way station to another universal federal entitlement...
(3) Obama wants to be to green energy what John Kennedy was to the moon shot, its visionary and creator. It starts with the establishment of a government-guided, government-funded green energy sector into which the administration will pour billions of dollars from the stimulus package and billions more from budgets to come.
But just picking winners and losers is hardly sufficient for a president who sees himself as world-historical. Hence the carbon cap-and-trade system he proposed Tuesday night that will massively restructure American industry and create a highly regulated energy sector.
These revolutions in health care, education and energy are not just abstract hopes. They have already taken life in Obama's massive $787 billion stimulus package, a huge expansion of social spending constituting a down payment on Obama's plan for remaking the American social contract.
Obama sees the current economic crisis as an opportunity. He has said so openly. And now we know what opportunity he wants to seize. Just as the Depression created the political and psychological conditions for Franklin Roosevelt's transformation of America from laissez-faireism to the beginnings of the welfare state, the current crisis gives Obama the political space to move the still (relatively) modest American welfare state toward European-style social democracy...
Conservatives take a dim view of the regulation-bound, economically sclerotic, socially stagnant, nanny state that is the European Union. Nonetheless, Obama is ascendant and has the personal mandate to take the country where he wishes. He has laid out boldly the Brussels-bound path he wants to take.
Let the debate begin.
We shouldn't be surprised by the radicalism of Obama's domestic agenda. He was, after all, the most liberal member of the Senate. And he found congenial both the preaching of Rev. Wright and the educational agenda of William Ayers...Obama's unwillingness, as a formal matter, to take Republican views on domestic issues seriously should not be surprising either. There is no room for meaningful discussion between radicals and non-radicals...
But Obama no longer needs Harvard conservatives or Illinois Republicans to vouch for his "reasonableness." Moreover, he is now engaged in an enterprise that requires a greater single-mindedness -- the transformation of the American economic system...
Under the circumstances, conservatives should be grateful for the clarity of the situation. It is better that battle lines be drawn in sharp relief than that Republicans have the opportunity to pull off this or that legislative tweak...Economic radicalism cannot be tweaked into something palatable.
We now know for certain that Obama is an out-and-out statist bent on redistributing income and clamping down on free markets. He desires, as Charles Krauthammer has shown, to convert our free and vibrant economy into a European-style nanny state.
Conservatives must be equally single-minded in the defense of our country's way of life. There is no cooperating with Obama on domestic issues, and to the extent that Republican Senators like Arlen Specter cooperate, conservatives must do whatever we can to end their public careers.
Irwin Stelzer on Big spender Obama sets the red ink flowing
...This should be of interest not only to Americans, but to the rest of the world, which cannot but be affected by a big change in the structure of the American economy.The most notable feature of the budget is its fundamental reordering of the role of government. In the fiscal year starting in October. Obama wants to spend a 10-year total of $630 billion for a downpayment on a government takeover of the healthcare system, green the nation’s energy economy, make college education an entitlement and otherwise heavily involve the federal government in an education system that until now has been under the control of local and state governments.
That is why spending aimed at getting the economy out of its rut is the least significant aspect of this budget. The president dismisses the notion that we are in the grip of a normal downturn in the business cycle: "We arrived at this point as a result of an era of profound irresponsibility that engulfed both private and public institutions from some of our largest companies’ executive suites to the seats of power in Washington, DC." Which is why Obama titled the budget document, "A New Era of Responsibility." What is responsible about a budget that projects deficits rising from $459 billion to $1,752 billion in the first year of Obama’s budget, and remaining at $712 billion as far ahead as 2019, when the economy will be growing, is not clear.
This flow of red ink will persist despite a huge increase in taxes — $1.4 trillion over 10 years. The bulk of that increase is to come from two sources: the rich, and polluters. Those the president calls "the wealthy and well-connected," a group he feels received too large a portion of the nation’s income and wealth during the boom years, will pay more.
In fact, a taxpayer does not have to be either wealthy or well-connected to serve as Obama’s cash machine. Single people earning $200,000 a year, and couples earning $250,000 will lose the benefits of the Bush tax cuts: top marginal rates will go from 35% to 39.6%, which will hit small firms that are taxed at individuals’ rates. Deductions for charitable contributions and mortgage-interest payments will decline, better-off pensioners will pay more for Medicare prescription drugs, estate taxes will rise, and the profits of hedge-fund managers will be taxed as ordinary income (39.6%) rather than as capital gains (15%).
Economists are debating the effect of these increases, with conservatives arguing they will reduce incentives to start new businesses. But economic arguments matter less to Obama than his own notions of fairness, of the need to tackle what he calls “a growing imbalance of accumulating wealth and closing doors to the middle class”. This is why he favours raising capital-gains tax even if that results in a decline in tax revenues, and why he is calling for a big transfer of wealth from upper- and not-so-upper income families and firms to what he calls 95% of Americans, whose taxes he claims will be lowered and whose benefits will be increased.
But even those lower earners will be hit by new taxes, but taxes that are in the long tradition of the stealthiness...The proposed cap-and-trade system, aimed at reducing greenhouse gas emissions, will require businesses to pay some $645 billion for pollution permits in 2012-19. That cost will for the most part be passed on to consumers, most of them not rich, in the form of higher prices — for which they will blame their utilities and other companies, rather than the president.
A final feature worth noting is that this budget brings out of retirement that old favourite, Rosy Scenario. The revenue estimates assume that the economy, which the government reported on Friday had declined at an annual rate of 6.2% in the final quarter of last year, will grow at a rate of 3.2% next year and more than 4% in 2011, 2012 and 2013. It assumes...military spending can be cut without imperilling national security. Most crucially, it assumes that a spendthrift Congress will change its ways to please the president.
Even more important, the underlying assumption of this budget is that the world will be willing to buy a flood of Treasury IOUs...
...the more radical features of Obama’s plan: spending at levels previously thought unimaginable, deficits as far ahead as the eye can see, a significant redistribution of the nation’s income from wealth creators to dependants on the state, government takeovers of significant sectors of the economy, more regulation of almost every business.
RIP the notion that Obama, who campaigned on the left, would govern from the centre.
Lawrence Kudlow on Obama Declares War on Investors, Entrepreneurs, Businesses, And More
...He is declaring war on investors, entrepreneurs, small businesses, large corporations, and private-equity and venture-capital funds.That is the meaning of his anti-growth tax-hike proposals, which make absolutely no sense at all — either for this recession or from the standpoint of expanding our economy’s long-run potential to grow.
Raising the marginal tax rate on successful earners, capital, dividends, and all the private funds is a function of Obama’s left-wing social vision, and a repudiation of his economic-recovery statements. Ditto for his sweeping government-planning-and-spending program, which will wind up raising federal outlays as a share of GDP to at least 30 percent, if not more, over the next 10 years.
This is nearly double the government-spending low-point reached during the late 1990s by the Gingrich Congress and the Clinton administration. While not quite as high as spending levels in Western Europe, we regrettably will be gaining on this statist-planning approach.
Study after study over the past several decades has shown how countries that spend more produce less, while nations that tax less produce more. Obama is doing it wrong on both counts.
And as far as middle-class tax cuts are concerned, Obama’s cap-and-trade program will be a huge across-the-board tax increase on blue-collar workers, including unionized workers. Industrial production is plunging, but new carbon taxes will prevent production from ever recovering. While the country wants more fuel and power, cap-and-trade will deliver less.
The tax hikes will generate lower growth and fewer revenues. Yes, the economy will recover. But Obama’s rosy scenario of 4 percent recovery growth in the out years of his budget is not likely to occur. The combination of easy money from the Fed and below-potential economic growth is a prescription for stagflation. That’s one of the messages of the falling stock market.
Essentially, the Obama economic policies represent a major Democratic party relapse into Great Society social spending and taxing. It is a return to the LBJ/Nixon era, and a move away from the Reagan/Clinton period. House Republicans, fortunately, are 90 days sober, as they are putting up a valiant fight to stop the big-government onslaught and move the GOP back to first principles.
Noteworthy up here on Wall Street, a great many Obama supporters — especially hedge-fund types who voted for “change” — are becoming disillusioned with the performances of Obama and Treasury man Geithner.
There is a growing sense of buyer’s remorse....
The Wall Street Journal Editorial Report has a vibrant video discussion about these economic issues.
Victor Davis Hanson pounds on conservatives and Republicans for enabling this disaster and then discusses the likely consequences of Obama's economic policies.
Yep, unfortunately, none of this is a surprise.
ADDENDUM
Justin's subsequent post led me to dig up this link.
And then there are always comparisons with prior comments and other relevant concerns like found here, here, here, and here.
Senate Majority Leader: Annual Budget Deficit To Exceed $600 million
Or it could be a billion dollars. Either the Majority Leader or the Valley Breeze was unclear.
Whatever the case, Senate Majority Leader Daniel Connors imparted this news in a meeting Monday (last) with Cumberland officials. From Thursday's Valley Breeze:
Income taxes keep falling thanks to unrelenting, record layoffs. All the while sales and restaurant taxes are plummeting as residents pinch their pennies, said Connors, a Democrat who represents some of Cumberland and Lincoln.At the same time, Rhode Islanders are applying for more and more social services, including unemployment benefits.
"The state is spending $1 million more a day than it is taking in," Connors told the town's leaders. "We're clearly in a crisis mode."
The $357 million mentioned as the deficit number "is really just to close out the fiscal year (on June 30)," he said. From 2009 to 2010, "we're well in excess of a billion-dollar problem and the situation continues to deteriorate. It's pretty grim."
So is the "billion-dollar problem" a combination of the shortfalls from the current year plus next year? Also, the headline of this story
Connors: Total 2008-'09 shortfall nears $1 billion
does not abate the confusion on this point.
Side note: I point out these little glitches in reporting not to complain, only to solicit clarity. We wouldn't know about this at all if it weren't for the Breeze; neither the Woonsocket Call nor the ProJo covered the Majority Leader's remarks.
Speaking Plainly from the Ivory Tower
William Jacobson is an interesting, surely rare, creature: A Rhode Islander and Cornell law professor, and apparently a conservative, unafraid to declare the obvious:
Union pensions for state employees are the single biggest problem, as a 2006 study showed. For decades, policies allowed state union employees to retire on full pensions with cost of living adjustments after 30 years regardless of age, based on a formula from the last three years of work. This system has saddled the state with ever-increasing payments with a shrinking work force paying into the system.By way of example, a unionized public employee who started working for the state out of college, say age 23, could retire at age 53 on a full pension for life, and could increase the amount of the pension by working overtime in the last three years. Other perks, such as getting retirement "credits" for taking classes, or buying credits, allowed employees to game the system. After "retirement" the state employee could simply get another job while collecting a state pension. It is likely that this person would spend almost as much of his or her life on a state pension as working for the state.
Such a system was great for the individual employee, and made state employment a coveted goal. Handing out state jobs was an important means of political patronage, mostly for the Democrats who control the state legislature. The system, however, was not sustainable. Attempts to change the system were opposed by the unions, which fought tooth-and-nail, with the overwhelmingly Democratic state legislature siding with the unions.
Is it union-bashing to point out that what is good for the unions may be destroying the state? Do the unions even know or care that they have created a house of cards which looks great to their members, but is on the verge of falling down? High taxes are a reflection, in part, of the need to fund these ever-increasing costs. This is an economic death-spiral which is picking up steam as it falls.
Another good one who got away — although I imagine Ithaca could make a man pine even for Rhode Island's proximity to centrism.
ADDENDUM:
The professor emailed to correct me: He maintains a residence in Rhode Island, so he hasn't truly gotten away.
The Top Issue at CPAC
... and the margin by which it surpassed other issues surprised me. From ABC's The Note:
CPAC's straw poll got underway on Thursday at the Omni Shoreham Hotel in Washington, D.C., and was conducted through Friday afternoon.As conference attendees would walk into the hotel's main ballroom, they were invited to fill out a questionnaire.
* * *
The conservative activists participating in CPAC's straw poll are primarily concerned with limiting the scope of government. Seventy-four percent of straw poll participants said they are most concerned about limiting the size of government, 15 percent said they are primarily concerned with promoting traditional values and 10 percent said they are primarily concerned with security regardless of the cost.
I'd have thought social issues/"traditional values" would have gotten top billing.
As for the winner of the CPAC presidential straw poll, frankly, I wish he were president now. It's a good guess that Mitt Romney would not be contemplating, for example, the nationalization of our banks or the dismantling of contract law and the slide in real estate values that will certainly follow - just the opposite of the effect sought - because banks will both constrict lending and charge more to lend. Ah, the road to hell ...
Check out Fox News for extensive coverage of CPAC, which wraps up today.
Reed and Whitehouse Oppose Free Speech
Via Ocean State Republican, via Club for Growth, we learn that Rhode Island's delegation provided two of the mere eleven U.S. Senators who broke with eighty-seven of their peers by voting against a Republican amendment preventing "the Federal Communications Commission from repromulgating the fairness doctrine."
Here's where political calculations come into play: The amendment was to a bill "to provide the District of Columbia a voting seat and the State of Utah an additional seat in the House of Representatives." Inasmuch as the two issues are essentially unrelated, some Senators surely voted for or against the amendment based on their expectations about whether the bill itself will pass. It's not inconceivable that a Senator or two hope that this amendment will provide cover for voting for or against the bill.
Of course, that makes it no less shameful that both of RI's Senators — including our blue-blooded advocate for a Truth Commission — implicitly backed the idea that the government ought to manipulate public debate.
Has the Fantasy Died, Yet?
You know whom I haven't heard from, lately? Those centrists and conservatives who were so sure that Barack Obama's natural tendency toward dialogue and cooperation would temper — maybe even cancel out — the liberalism of his past. Their silence is understandable; this must be an awful bulk to absorb among the hopes and impressions they imbibed while splashing about in the zeitgeist of the campaign (emphasis added):
While tackling the economic crisis, he is asking Congress to enact contentious measures that have been debated, but not decided, in calmer times: cut subsidies for big farms; combat global warming with a pollution tax on industries; raise taxes on the wealthy; make big changes to health care, including lower reimbursements for Medicare and Medicaid treatments and prescription drugs.Standing alone, any one of these proposals would trigger a brawl in Congress and fierce debates outside Washington. Obama wants the proposals done largely in concert, as an interrelated plan to undo major elements of Ronald Reagan's conservative movement.
"They're gearing up for a fight," he said. "So am I."
Remember just a few years ago, when folks were touting Reagan as the cool head that President Bush ought to emulate? When the success of welfare reform was common knowledge? Or when this interview, which led the Obama campaign to blacklist a television station, was much more controversial than it should have been:
West bored in, quoting Karl Marx's "From each according to his ability, to each according to his needs," and asked Biden, "How is Senator Obama not being a Marxist if he intends to spread the wealth around?"Biden appeared stunned and asked, "Are you joking? Is this a joke?"
He then insisted that despite Obama's declaration that he would spread the wealth around, Obama "is not spreading the wealth around." ...
West returned to the "spreading the wealth" question, asking Biden what he'd "say to the people who are concerned that Barack Obama will want to turn America into a socialist country much like Sweden?"
Biden again ducked the question, saying only that he didn't know anybody who thinks that, "except the far-right wing of the Republican Party."
A far broader swath of the American population may begin to "think that," now that the proposition's thorough possibility is coming to light. Consider:
Some liberal-leaning foundations are unhappy about his proposed reduction in the tax deductibility of gifts to charity from wealthy people.
What will we need private charities for when the government picks up the slack? "Obama's gonna change it; Obama's gonna lead 'em," as the children sing. It's just a matter of selling the plan, as we flip through the milestones to subjugation.
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