Hey, guess what, they ARE for raising taxes

By Clifford F. Thies

During the election of 2008, I actually listened to Obama’s stump speech. Like a taxi cab driver, I put the meter down when he started talking and ran a running total of the cost of his promises. Free or reduced cost medical care, help with college tuition, affordable housing, new initiatives in Africa and elsewhere, climate change, on and on and on, 1 trillion dollars, 2 trillion dollars, 3 trillions dollars, etc. and etc., all to be paid for with a small increase in taxes on "the rich,” even while most people would be getting “a middle-class tax cut.”

The numbers never added up.

Now, in the face of the country’s second year of trillion dollar deficits, the Democrats are talking tax increases, starting with the expiration of the Bush tax cuts, as well as every other tax break with an expiration date, higher income and payroll taxes, higher taxes on business (that will merely get built into the prices of the goods and services they sell), increased fees, and – the really big one – a national sales tax of something like 20 percent.

It’s not that Democrats “want” to raise taxes. It’s that the deficits are “unsustainable.” And, besides, it’s all Bush’s fault. The deficits, the bailouts, the cost of the wars in Afghanistan and Iraq, the whole financial mess, it all began under Bush.

During the first seven years of the Bush administration, the ratio of debt-to-GDP remained constant. The addition to the debt was, thus, sustainable forever. To be sure, this is a retreat line from the traditional definition of a balanced budget, but it is a valid concept.

The budget would have met the traditional definition if not for the wars in Afganistan and Iraq. In real time, I supported the former and opposed the latter. But, what are Democrats raying? That 9-11 was Bush’s fault?

Because such things happen, fiscal policy should be calibrated so that, over the long haul, taking war years and peace years into account (as well as taking recession years and recovery years into account), there should be no upward trend of the ratio of debt-to-GDP.

Socialist policies delay Recovery; You'd think we would have learned that from FDR's Time

With regard to deficits associated with the crash of 2008 and following, some degree of deficit spending during a recession is good, in accordance with the principle I just expressed. The way the federal budget operates, tax revenues constitute an enormous “automatic stablizer.” During recessions, tax collections fall much more than GDP, and during recovery, they increase much more. Unemployment benefits are another automatic stabilizer. Payments increase during recessions and collections increase during recoveries.

BUT ... where is the recovery? Socialist policies forestall recovery. Indeed, raising taxes from already high levels make deficits worse because of what are called supply-side effects.

The ginormous stimulus packages and several extensions of unemployment insurance have thrown fiscal policy completely out of whack. While saying this started under Bush (as though the Congress was not Demoncratic at the time) may serve some partisan purpose. But, I am unconstrained by partisanship. Socialism under Herbert Hoover was bad, as well as under FDR. And, socialism under Bush was bad, as well as under Obama.

With regard to the even more ginormous but hidden debt implicit in our entitlement programs, I thought we had agreed not to concern ourselves about that? The time to have done something was under Clinton. And, we did something. Clinton appointed a commission, and it produced three minority reports, one for complete privatization (a la Chile), another for a government-managed private investment board (a la Singapore), and a third for funding the investment board only with U.S. Treasury securities, none of which was enacted. Instead, the pathetic U.S. Congress merely approved sending out an annual report detailing how much S.S. participatants "contributed" into the system.

Bush made partial privatation of S.S. a campaign issue in 2000 in order to get my vote, but, you know the old saying, fool me once shame on you. Now, with no viable way to save the U.S. from eventual default on its entitlement programs, there's a certain Janis Joplin-like freedom.

Nobody should care about the deficit. It's just re-arranging the chairs on the deck of the Titanic. And, nobody should agree to a tax increase. It just encourages the bastards.

From The Right Guy

By Jim Lagnese, Libertarian Republican Asst. Editor

In a turn of events, a sheriff's deputy was shot yesterday. Report from KTAR and the AP:

PHOENIX - A veteran sheriff's deputy was shot and wounded Friday after encountering a group of suspected illegal immigrants who apparently had been hauling bales of marijuana along a major smuggling corridor in the Arizona desert- a violent episode that comes amid a heated national debate over immigration.

I wonder if "Humble Libertarian" Wes Messamore thinks these are just hippie farmers? While LR Publisher Eric Dondero and AZ Libertarian candidate for Governor Bruce Olsen want to legalize marijuana, it's not the harmless trade they say it is, or purely attributed to "hippie farmers" that Wes attributes it to. I would also submit that an AK-47 is not a zip gun either.

This underscores the seriousness of the illegal alien problems in Arizona and elsewhere in this country. Not all of them are coming here carrying posies and daffodils, just wanting to cut your lawn or wet nurse your kids.

While I think that the drug war has criminalized a lot of people, too many, that were just users, will legalization really bring peace? Will these drug traffickers become legitimate businessmen overnight? Who regulates the industry? If the government does, then they get to pick winners and losers just like car companies and banks. How does that work from a libertarian perspective?

Obviously the drug problem and illegal alien problem are not one in the same. Solving each one requires different measures, but the two become intertwined due to the mechanism of trafficking both humans and drugs.

As I have said before, with illegals, make the penalty for hiring them so extraordinary that no one will want to take the chance and enforce it. Can you imagine the penalties on Tyson Foods alone? We could pay off the deficit.

As far as the drug trade goes, that is another issue. It is my opinion that there will always be addicts. You can get them to switch or trade their addictions, but they always will be addicts. Where should the effort go? Would the money spent to put users in prison be better spent on rehabbing them? Studies show that only 3-4% are successful in the first go around. May be 10-12% on the second. It can take at least 3-4 go arounds through rehab before people get it. And even then, what is the substitute? Hopefully something a little safer.

The drug war has been a failure. Part of it is because we are dealing with supporting countries that are poor and drugs are money. Part of it is the culture they come from accepts a much higher level of criminal activity and immoral behavior. JMO. They accept criminals as legitimate authority, so coming here illegally is not even a traffic ticket to them.

If we wanted to win the war on drugs, we could. We have the military and technological know how to remove it off the map, may be permanently. The consequences of doing so are equally as troubling. Nature abhors a vacuum. What will take the place economically and politically of the drug lords and that culture? Coffee doesn't make as much money as cocaine, pot and heroin, and the history of Central and South America is such that most legitimate business are controlled by local oligarchs and international companies. They do not have the opportunities we have here for the little guy to start a business and to be successful. Part of it is their culture and the US bears some responsibility for supporting these multinational corps an oligarchs who have in many cases feigned being democratic, and we have seen the results. As much as I eschew socialism, I can see why a lot of these people run towards it.

What's the solution? Very simplistically, the regular folk in those countries need to be able to create opportunities for themselves, there. It requires a cultural and political shift in the countries they live in, and how they get there is beyond the scope of this post. I will say running to people like Chavez, Morales, or even Fernandez de Kirchner is in the wrong direction. May be the solution is mass immigration into these countries by people whose ideals are more aligned with free market thinking. How do they get there(The locals to a democratic and free market society)? What do you think?

Thank you for reading this blog.