I’m very concerned about both the fiscal cliff and its possible replacements. It will bebad news if we get an automatic tax hike on January 1, and it will be bad news if that tax increase is replaced by an even more odious plan concocted by the White House.
But the cliff is not our biggest fiscal problem.
Here’s some of what I wrote for today’s New York Post about the fiscal cliff, along with a warning that we have a much bigger problem down the road.
…it’s a fight that has important implications, particularly since some of the tax increases will have a significantly harmful impact on incentives to work, save, invest and create jobs. In a competitive global economy, for instance, it is bizarrely self-destructive to increase the double taxation of dividends and capital gains. …This is all bad news, but it is not a crisis. If we go over the cliff, it simply means the economy will grow a bit slower and politicians will spend a bit more money. And the sequester actually would be (modest) good news, since it means the burden of government spending would be “only” $2 trillion higher 10 years from now, rather than $2.1 trillion higher. And even if Obama prevails in the fight, that simply means that we get a different mix of tax hikes and spending rises at a faster rate. Sure, that’s bad for the economy, but it’s not the end of the world. The real crisis is the ticking time bomb of entitlement programs and the welfare state. This bomb won’t explode this year or next year. It may not even explode for another 20 years. But at some point America will experience a Greek-style fiscal collapse if these programs are not reformed.
Just how bad is this future problem? Gee, I’m glad you ask.
A lot of people get upset about the national debt, which is somewhere between $11 trillion and $16 trillion, depending on whether you include money the government owes itself. Those are big numbers — but if you add up the amount of money that the government is promising to spend for entitlement programs in the future and compare that figure to the amount of revenue that the government projects it will collect for those programs, the cumulative shortfall is more than $100 trillion. And that’s after adjusting for inflation. Some politicians claim this huge, baked-into-the-cake expansion of government isn’t a problem, because we can raise taxes. But that’s exactly what Europe’s welfare states tried — and it didn’t work. Simply stated, even huge tax hikes won’t stem the flow of red ink in the long run if government keeps growing faster than the private economy. This is the fiscal problem that demands attention. Absent real entitlement reform, such as block-granting Medicaid to the states, the burden of government spending will consume ever-larger shares of our economic output with each passing year.
P.S. If my only choice is surrendering to Obama or going over the fiscal cliff, I’ll take the plunge without a second’s hesitation. At leastwe get the sequester if we go off the cliff, so there’s a tiny bit of spending restraint. Moreover, if the GOP capitulates to Obama on this fight, it will set the stage for additional bad policy over the next two years (much as the acquiescence to Obama during the March 2011 “government shutdown” fight was a sign of things to come for the last years, but at least weresuscitated two good cartoons and got some good jokes out of that debacle).
P.P.S. In addition to the Ramirez cartoon above, you can enjoy thisbunch of amusing fiscal cliff cartoons. Or I should say they’re amusing so long as you don’t think about the implications.
Earlier this year, I explained that tax revenueswould soon climb above their long-run average of 18 percent of GDP, even if the 2001 and 2003 tax cuts were made permanent. In other words, the nation’s fiscal challenge is entirely the result of a risingburden of government spending.
Even though the data on tax revenue comes from the left-leaning Congressional Budget Office (yes, the same folkswho seem to think you maximize growth with 100 percent tax rates), many folks on the left simply refuse to believe the numbers. In their minds, it is a religious tenet that red ink is the result of “tax cuts for the rich.”
So I wonder what they will think of this chart, produced by the White House, that shows tax revenues will…drum roll please…rise above 18 percent of GDP even if lawmakers decide to “extend current policy.”
Apologies for the poor quality of the chart, by the way. It was sent out in an email by the White House andposted on the TaxProf Blog. It’s the best copy I can find.
But you don’t need 20-20 vision to see that tax revenues will get to about 18.5 percent of GDP 10 years from now if current tax policy is made permanent.
Here’s a chart I made. It’s not as fancy, but it shows tax revenue for the last 50 years of the 20th Century, plus the years leading up to Obama this century. The average is exactly 18.0 percent, with a slight upward trajectory according to the Excel auto-trendline feature.
The moral of the story is that the tax increase battle is not about deficits and debt. ThePresident’s class-warfare tax policy is designed to enable bigger government.
In the short run, the tax increase will help lock in place the expansion of government thattook place during the Bush-Obama years.
In the long run, though, the left will want even more taxes to enable the demography-drive expansion of the welfare state. Higher revenues, in other words, are a substitute forreal entitlement reform.
What the left generally won’t admit, however, is that the rich are not a piñata, capable of disgorging limitless amounts of new money. There arebig Laffer-Curve effects when tax rates climb too high, largely becauseupper-income taxpayers have considerable control over the timing, level, and composition of their income.
P.S. You may have noticed that the White House used 20 percent of GDP as a benchmark in its chart, apparently because we should strive for the fiscal policy we had in Bill Clinton’s second term. I might be willing to take them up on that offer, so long as they’re also willing to accept Bill Clinton’s spending levels.
No Need to Pretend; Now it’s all about Taxes, Spending, and Power
During the campaign for re-election, Barack Obama at least madevague references to a willingness to accept $3 trillion of reduced spending in exchange for a $1 trillion dollar tax increase. The vast majority of his feigned belt-tightening was smoke-and-mirrors beltway accounting gimicks, but at least back then he was willing to pretend.
With the election behind him, the pretence is gone. Now it is all about higher taxes, more spending, and raw executive power. That’s change you can believe in.
Re-election in hand, Obama is pitching what economist Larry Kudlow calls “agargantuan $1.6 trillion tax hike” that would doubtlessly shackle the faltering economy even more than his policies have over the last four years. For the record, that’s twice the tax increase he was campaigning on less that a month ago.
In addition he wants more – not less – spending in the form of yet another $50 billion “economic stimulus.” And, taking a que from Eqypt’s wannabe Dictator Mohammed Morsi, Obama is demanding new Presidential authority to “permanently increase the U.S. debt limit to avoid the need for congressional action.”
Obama’s phantom $3 trillion of spending cuts referenced last year during the campaign has now shriveled to a mere $400 billion – with the standard Obama “trust-me” provision demanding the tax increases now, and no more than a tease to “get back to me later, and we’ll talk about those cuts.”
The President conveniently doesn’t identify where he’s willing to cut. Most likely he is once again counting the“savings” from not fighting the wars in Afghanistan and Iraq; phantom dollars that were never going to be spent anyway.
Instead of pulling America back from the fiscal cliff, Obama just stepped on the accelerator.
Obama knows that this “plan” is a non-starter. As a supposed offer of negotiation to the GOP, it is “not just a bad deal, it is insulting,”said Charles Krauthammer. “Robert E. Lee was offered easier terms at Appotmattox, and he lost the Civil War,” Krauthammer roared on Fox News.
Obama’s plan is based on the last budget he presented to congress that received exactly zero votes – even from his own Democrats. This is pure politics. He’ll demagogue the “obstructionist Republicans” for their unwillingness to sign off on his “balanced” plan. Republicans will take heat from the obliging mainstream media, and Democrats will be thankful they never have to vote for this nonsense.
The real question is where will all of this end. Both parties seem focused on raising revenue now. They’re just wrestling over how much, and who pays.
To their credit, Republican Leadership in the House and Senate are trying to make the point that real spending reductions and particularly entitlement reform need to be on the table, but Obama and the Democrats are simply ignoring the obvious. This is all about raising taxes for them, period.
A deal of some type will likely get made, but don’t expect it to be a good deal. From the sparing going on between the principles it is hard to see a glimmer of hope for any real economic growth policy coming out of this quagmire.
Growth – not bigger, more powerful government – is most certainly what the end game should be. Revenue to the federal treasury is down; not just from where politicians would like it to be, but really depressed. As we explained on these pages recently, due to the stagnant economy and pitiful non-recovery Obama recovery total receipts in FY 2012 were $119 billion less than back in 2007. Spending, however has increased more than $800 billion. Some recovery!
The primary reason real economic recovery has lagged so long is the endless promulgation of new, more costly, confining regulation and the uncertain tax environment from Washington. The revenue lost due to unrealized economic growth because of the abusive economic policies merits charges of fiscal malfeasance against the Administration and the Democrats that have supported it.
The following chart produced by the Congressional Budget Office for a report to Congress proves the point. It demonstrates that a miniscual 1/10 of 1 percent reduction in GDP per year results in $314 billion of additional deficit spending – debt – over ten years. Thanks is due to CATO’s Dan Mitchell for recently drawing our attention to this data.
The obvious question is what if instead of thepaltry GDP that has been stuck around 2 percent or below for the 3 ½ years since this non-recovery recovery began, the economy was humming at 3 – 5 percent growth in GDP as normally happens during an economic recovery?
Mr. President and Members of Congress, economic growth is where your attention should be. Not whose pocket to pick.
GOP Needs to Stand Tall, Call Obama’s Bluff & Let All Bush Tax Cuts Expire
Dec 04, 2012
President Obama’s offer to Republicans to save the country from its fiscal cliff plunge is one big joke. Senate Minority Leader Mitch McConnell said he “laughed” when Treasury Secretary Tim Geithner, Obama’s cliff negotiator, unveiled it to him. Laughable is right when you consider the president’s outlandish request calls for tax hikes on higher earners, the one thing Republicans repeatedly have warned Obama, since day one of his presidency, were non-starters to any budget or deficit reduction talks.
Nevertheless, our “unserious” Commander-in-Chief put forth a deal to grab headlines rather than avert the January 1, 2013 sequestration deadline of $1.2 million in automatic spending cuts and tax increases, which include the expiration of ALL the Bush tax cuts. The president’s plan demands $1.6 trillion in tax hikes over 10 years on higher earners, which includes small business owners also known as job creators! This includes $1 trillion by ending the Bush tax cuts for the “rich,” which includes theestate tax and hitting this group again with $600 million more in tax hikes next year. Big GULP! Obama’s philosophy is “you can never tax rich too much.” They should just keep on earning and paying for Obama’s government largess.
But let’s get something straight, a married couple, who also may be small business owners and/or have kids, making $250,000, isn’t rich and they shouldn’t pay nearly 40% of their hard earned income in federal taxes. Obama wants their tax rate to go from 35% to 39.6% and leave the rates for everyone else lower. A single person’s who may be a small business owner, making $200,000 would see their rate rise from 33% to 35%. People who earn more money don’t do it by sitting on their butts all day so others can be rewarded with lower tax rates. Apparently, President Obama won’t be satisfied until higher earners are indentured servants to the state, paying 100% of their income in federal taxes.
The nation’s top 10% of earners pay 70% of all federal income taxes, the top 2% pay about 50% of all federal income taxes and nearly half of Americans pay no federal income. We can see who pays their fair share.
7 Reasons Socialism Will Make You Poorer Than Capitalism
Dec 04, 2012
Given what we know in 2012, saying that capitalism will make a society richer than socialism should be about as controversial as saying the earth is round, not flat. Yet, a recentGallup poll shows that more liberals have a positive view of socialism than capitalism. This is only possible because there are so many perverse incentives that drive the promotion of socialism. If you’re a politician, socialism puts power in your hands while capitalism takes it away. If you want to use the government to control people’s lives, socialism is a wonderful vehicle to do just that while capitalism robs you of that opportunity. If you would rather live off the dole than to work or alternately, prefer to make money off “who you know” instead of “how good a service you provide,” again socialism works better for you. Now take into account the fact that there are no pure socialist or capitalist economies left and it becomes very easy to muddy the water and keep people from realizing the obvious economic superiority of capitalism.
1) Socialism benefits the few at the expense of the many: Socialism is superior to capitalism in one primary way: It offers more security. It’s almost like an extremely expensive insurance policy that dramatically cuts into your quality of life, but insures that if worse comes to worse, you won’t drop below a very minimal lifestyle. For the vast majority of people, this would be a terrible deal. On the other hand, if you’re lazy, completely incompetent or alternately, just have a streak of very bad luck, the meager benefits provided by socialism may be very appealing. So a socialist society forces the many to suffer in order to make it easier for the few. It’s just asWinston Churchill once noted, “The inherent virtue of socialism is the equal sharing of miseries.”
2) Capitalism encourages entrepreneurship while socialism discourages it: A government in a capitalist economy can quite easily give everyone equality of opportunity with a few basic laws and regulations, but socialism strives to create equality of results. This should frighten people who value their freedom because ultimately, as F.A. Hayek has noted,“A claim for equality of material position can be met only by a government with totalitarian powers.“ You can see this happening in America as our efforts to reduce “inequality” have led to an ever expanding government and a vast regulatory tangle that is almost unexplainable despite the fact that it is certainly enforceable. Capitalism encourages people to start a business and build a better life for themselves while socialism lays in wait with IRS agents, nooses made of red tape and meddling bureaucrats looking for businesses to control and loot.
3) Capitalism leads to innovation: Coming up with new products is often time consuming, expensive and hit or miss. Nine ideas may fail before that tenth one takes off. The less the creative people behind these ideas are allowed to benefit, the less time, money and effort they’ll put into developing new concepts and inventions. Put another way, the bigger the risk, the bigger the reward has to be to convince people to take it. Capitalism offers big rewards for productive people while socialism offers makers only a parade of bureaucratic leeches who want to take advantage of their “good fortune.”
4) Capitalism produces more economic growth: Capitalism produces considerably more economic growth than socialism and as John Kennedy said,“A rising tide lifts all boats.” A fast growing economy produces more jobs, more wealth and helps everyone. Many people assume that capitalism isn’t working if there are still poor people, but that misses the point. In many parts of the world, poverty means living in a hut with a dirt floor while in America, most poor Americans have TVs, refrigerators and cell phones. The rich may take home a larger share of the pie in capitalism, but the poor also benefit tremendously from living in a growing, thriving economy.
5) Socialism is too slow to adapt: Capitalism is extremely good at allocating capital to where it’s most valued. It has to be. Either you give people what they are willing to pay for or someone else will. On the other hand, socialism is slow and stupid for a variety of reasons. Because the government is spending someone else’s money, it doesn’t get particularly concerned about losing money. Political concerns about appearances often trump the effectiveness of a program. Moreover, even if politicians and bureaucrats are intelligent and competent, which are big “ifs,” they’re simply not going to have the specific knowledge needed to make decisions that may impact thousands of different industries. This is why capitalism may have its share of troubles, but when there are really colossal economic screw-ups, you’ll always find the government neck deep in the whole mess.
6) Socialism is inherently wasteful: Milton Friedman once said, “Nobody spends somebody else’s money as carefully as he spends his own. Nobody uses somebody else’s resources as carefully as he uses his own.“This is very true and it means that the more capital that is taken out of the economy and distributed, the more of it that will be wasted. The market does a considerably better job of allocating resources than the government because there are harsh penalties for failure. A company that makes products no one wants will go out of business. A poorly performing government program that wastes a hundred times more money will probably receive a bigger budget the next year.
7) Capitalism works in concert with human nature while socialism works against it:Ayn Rand said it well, “America’s abundance was created not by public sacrifices to ‘the common good,’ but by the productive genius of free men who pursued their own personal interests and the making of their own private fortunes. They did not starve the people to pay for America’s industrialization. They gave the people better jobs, higher wages and cheaper goods with every new machine they invented, with every scientific discovery or technological advance—and thus the whole country was moving forward and profiting, not suffering, every step of the way,” butAdam Smith said it better, “It is not from the benevolence of the butcher, the brewer, or the baker, that we expect our dinner, but from their regard to their own interest.” A man will work much harder to take care of himself, his family and his friends than he will to make money for the state, which will then waste most of it before redistributing it to people who aren’t working as hard as the man who earned it in the first place.
Fiscal Cliff Notes
Dec 04, 2012
Amid all the political and media hoopla about the “fiscal cliff” crisis, there are a few facts that are worth noting.
First of all, despite all the melodrama about raising taxes on “the rich,” even if that is done it will scarcely make a dent in the government’s financial problems. Raising the tax rates on everybody in the top two percent will not get enough additional tax revenue to run the government for ten days.
And what will the government do to pay for the other 355 days in the year?
All the political angst and moral melodrama about getting “the rich” to pay “their fair share” is part of a big charade. This is not about economics, it is about politics. Taxing “the rich” will produce a drop in the bucket when compared to the staggering and unprecedented deficits of the Obama administration.
No previous administration in the entire history of the nation ever finished the year with a trillion dollar deficit. The Obama administration has done so every single year. Yet political and media discussions of the financial crisis have been focused overwhelmingly on how to get more tax revenue to pay for past and future spending.
The very catchwords and phrases used by the Obama administration betray how phony this all is. For example, “We are just asking the rich to pay a little more.”
This is an insult to our intelligence. The government doesn’t “ask” anybody to pay anything. It orders you to pay the taxes they impose and you can go to prison if you don’t.
Then there are all the fancy substitute words for plain old spending– words like “stimulus” or “investing in the industries of the future.”
The theory about “stimulus” is that government spending will stimulate private businesses and financial institutions to put more of their money into the economy, speeding up the recovery. But the fact that you call something a “stimulus” does not make it a stimulus.
Stimulus spending began during the Bush administration and has continued full blast during the Obama administration. But the end result is that both businesses and financial institutions have had record amounts of their own money sitting idle. The rate of circulation of money slowed down. All this is the opposite of stimulus.
What about “investing in the industries of the future”? Does the White House come equipped with a crystal ball? Calling government spending “investment” does not make it investment any more than calling spending “stimulus” makes it stimulate anything.
Choke the Life out of Obamacare
Dec 04, 2012
Now that Obama has been re-elected and Democrats still control the Senate, Republicans no longer have the chance to repeal Obamacare.
But all is not lost. There’s still an opportunity for America to stop this disaster by choking the life out of the federal monstrosity. Obama’s signature legislative achievement is likely headed back to the Supreme Court.
Just last week, the high court ordered a lower federal court to take up a lawsuit by the patriots at Liberty University, who claim Congress violated the college’s religious freedoms by forcing it to provide federally mandated insurance and requiring payment for abortion-related services.
Liberty University also argues that the individual mandate is unconstitutional because it infringes on the free exercise of religion by forcing citizens to fund abortion.
“God created human life. Its sanctity and dignity are protected by God,” said Mathew Staver, chairman of Liberty Counsel, who represents Liberty University in the case. “We have no right to take innocent human lives, and certainly we cannot be forced to fund the taking of innocent life — basically forced to fund murder. We can’t do that. That’s a line that we simply cannot cross.”
Staver is absolutely right: There’s no middle ground in this fight. Citizens and employers shouldn’t be forced to choose between obeying the law and honoring the Sixth Commandment.
This month, federal courts have blocked the Obama administration from imposing its contraceptive mandate on Tyndale, a Bible publisher, and O’Brien Industrial Holdings, a Missouri mining company. The Christian-owned craft chain, Hobby Lobby, is fighting a similar legal battle against the mandate. The company says fines could reach as much as $1 million a day if it doesn’t cover abortion-inducing drugs for its employees. About three-dozen Christian companies and colleges are fighting the mandate in court.
In June, President Obama said, “(Insurance companies) are required to provide free preventive care like checkups and mammograms … .” The law also subsidizes care for people who pay more than 8 percent of their income for health insurance.
But Obamacare isn’t “free.” The money must come from somewhere. Even if patients don’t pay for their health care directly, Americans face higher taxes to fund the facilities, doctors and services.
When consumers perceive health care to be “free,” they use more medical services and create an overwhelming demand for them — which will eventually exceed supply. Then, government will be faced with a limited number of options: 1) ration health services, 2) increase the cost of your health care or 3) ignore the issue, as patients’ access to health care is severely restricted.
Obama Barreling Toward Real Fiscal Cliff
Dec 04, 2012
Some commentators wonder why President Obama always engages in brinksmanship. Why can’t he meet Republicans halfway, like Clinton did, they ask. Let me try to respond.
One blogger suggests that Obama prefers to play chicken, taking the nation right to the edge of a fiscal disaster because it will increase the likelihood that the GOP will cave. Perhaps, but there’s more to it.
Many of us warned that Obama is not, by nature or ideology, a conciliator. He is not a centrist, and he’s not someone who is interested in the other side’s ideas. He knows what he wants to do, and he is hell-bent on doing it. He is not just playing hardball as a matter of strategy; he has no interest in compromise and is angling to get his way entirely. And he wants to further damage the Republican brand in the process.
The way Obama probably looks at it is that Republicans will cave and he will either get most of what he wants, or the Republicans will hold fast and he can effectively blame them for taking us over the fiscal cliff. You’ll note that in none of these explanations is there a hint that Obama is motivated to do what is best for the country. He intends to act in his own best interests and those of his party, and decidedly against the interests of the GOP and, ultimately, the nation.
To better understand what we’re dealing with and what the stakes are in these negotiations, let’s take a look at what people mean when they say we’re headed toward a fiscal cliff in January — as distinguished from the much bigger cliff we’re heading for if we don’t get our deficits and debt under control very soon.
The immediate fiscal cliff includes the largest tax increase in a single year in our nation’s history ($494 billion), dangerous defense cuts via sequestration, a Medicare reimbursement fiasco and an expiration of federal funding for extended unemployment benefits.
Despite these looming concerns, Obama hasn’t approached these budget talks in good faith, but in a way that even former defenders recognize is designed to result in an impasse. Indeed, Obama’s proposal is so manifestly unreasonable that even his own party – Democratic senators and congressmen — has consistently rejected less extreme versions of it in its unanimous votes against his budgets.
Dec 04, 2012
The opening scene-setter for the 1996 film “Independence Day” might serve as a metaphor for what Egyptians could face if a draft constitution written by a panel dominated by Islamists and based on Sharia law wins approval in a referendum: “A loud rumble is heard. Suddenly, we are covered in darkness as the shadow engulfs us. Only the image of our Earth hangs in the air, until a huge silhouetted object suddenly blocks our view.”
Egypt could well embrace the dark side (to mix movie metaphors) and become the region’s biggest force for extremism, just ahead of the Wahaabists in Saudi Arabia, though Iran with its race toward nuclear weapons poses the most immediate danger.
The lowlights of the draft constitution ought to alarm all but the most complacent, as well as those who have been in denial, claiming we have nothing to fear from this “peaceful religion,” which somehow keeps providing examples to the contrary.
According to the Associated Press, the new draft says, “…the principles of Islamic law” are to be enshrined in the Egyptian constitution. Previously, notes the AP, those principles were open to interpretation, but in the latest draft a separate new article is added that defines “principles” by “pointing to particular theological doctrines and their rules,” which will likely result in a stricter interpretation.
Other articles in the draft fail to guarantee equal rights for women, or tolerance for other religious beliefs, including, presumably, moderate Islamic beliefs that conflict with the doctrines of the Muslim Brotherhood. Egyptians won’t be allowed to “insult or defame the Prophet,” but what constitutes an insult and the punishment for the affront is not spelled out.
Another article preserves military tribunals, allowing them to try civilians. AP estimates 11,000 civilians “were tried before military tribunals during the post-Mubarak transition…” The constitution does not ban slavery, according to AP, or guarantee that Egypt will adhere to international rights treaties.
All of this was foreseeable, if the West had listened to what Islamists promised to do when they achieved political power. We’re not dealing with classified information here. In other countries where Islamists have gained power — in our era and throughout history — they have behaved toward others with differing beliefs and religions exactly as they are behaving now. Except now, opponents scatter for fear of being labeled an “Islamophobe.” Are they Islamophobes if they quote Islamists’ words and point to their actions in an effort to warn others what is coming? Free people ought to be afraid and act accordingly.
Roll Out the Red Carpet – A New State is Born (Kind Of)
Dec 04, 2012
Happy Birthday, Palestine! Strike up the band. Ice the champagne. Run up the flag. Rally and cheer. Orate and pose for the cameras. Declare victory. Dance the night away. Sing another chorus of Baladi! Baladi! Better yet, gather ’round the campfire, and pass the finjan till dawn telling glorious stories of a past that never was.
Historical revisionism, it used to be called. The new name for it is counter-narrative. But the basic theme hasn’t changed: the mutability of the past, the flexibility of fact, the preference for what we wish had been over what was. Who says Arabs and Southerners have nothing in common? Our common allegiance to a Lost Cause — and the imagined past that goes with it — make us ideological kin.
So raise a toast to the Grand Mufti and a Judenrein future, when these interlopers will be gone, and their preposterous little state with them. Israelites in this day and age? Why haven’t they had the grace to disappear like the Jebusites and Amalekites and all those other extinct tribes? This living fossil called Israel should have vanished eons ago — and will once the State of Palestine finally supplants it. Praise the United Nations from whom all blessings flow! Or would if the UN still meant anything.
At last, millennially, a Palestinian state has been officially recognized by that august body, the UN General Assembly, that great gathering of every tinpot dictator with delusions of grandeur and every tyranny that specializes in murdering its own people.
I can’t recall offhand: Did Syria’s crumbling regime vote for this resolution, raising a bloody hand in its favor along with the representatives of those other great redoubts of democracy, the new same-old Russia and still Communist China? Why not? Everybody else seemed to vote for it; I lost count at something like 130 Yeas.
The president of this new state, or at least the remaining part of it on the West Bank that the newer Palestinian state in Gaza despises, called the UN vote a “birth certificate” for Palestine, whatever or just wherever it is.
It was a great show of support for the new state even if it was mainly show, since the birth certificate seems to come with a lot of small print. The kind that renders documents official but meaningless. For instance, the new “state” won’t have voting rights at the UN. As if anybody would notice another vote for the next lopsided resolution out of the General Assembly blaming Israel for all the troubles in the world, or declaring Zionism an international crime. (The only thing missing from such resolutions is complimentary yellow stars for the Israeli delegation.)
December 4, 2012
Cash-strapped states are finding it increasingly difficult to find new sources of revenue. Many states have turned to tax increases to sustain current levels of spending rather than making cuts in various programs. As a result, people have begun to move to different states to avoid the taxation, resulting in a net loss of revenue, says the Fiscal Times.
Five states top the list for shrinking populations according to migratory patterns:
Some states have had a constant stream of people moving out of the state, like Ohio; yet the fact that Illinois has so many people moving out surprises many. However, the state has experienced an income tax increase of almost 67 percent, which has residents opting to leave the state.
Some local economies benefit from the increase of new residents as employers expand their consumer base and attract new talent. Low tax incentives have helped states like Texas and Florida develop better tax bases.
However, states with a declining population must worry about the long-term implications. For example, a dwindling population may create a negative feedback in which local governments respond to it by increasing taxes to make up for lost revenue, which, in turn, would lead to more people leaving the state.
You must be logged in to post a comment.