Mr. President, when Vladimir Putin can tell you the government is too big, it’s time for a rethink

As expected, the Obamnibus passed the House.  As not so expected, the Republican caucus held firm for the first time in sixteen years and gave the monstrosity exactly zero votes (Roll Call Vote).

This is beginning to look like a re-run of the 1993 Clinton “stimulus.”  That time it was Republicans in the Senate who held firm (with some help by then-Democrat Richard Shelby) and actually killed the plan by filibuster.  The GOP later went on to unanimously oppose Clinton’s tax hike that summer, and was rewarded for their principled stand in 1994 with control of Congress for the first time in forty years.

Before the Republicans in Washington found their spine, Clinton’s stimulus was considered inevitable, too.

As for this version, not only have 200 economist come out against the idea (Cato), but so did a certain foreigner who in the process set a unique precedent (the Times of London, emphasis added):

Vladimir Putin, the Russian Prime Minister, launched a swingeing attack on Western financial rescue packages yesterday . . . “Interference of the State, the belief in the omnipotence of the State: that is a reaction to market failures,” Mr Putin said in his keynote address at the opening of the four-day meeting. “There is a temptation to expand direct interference of state in economy. In the Soviet Union that became an absolute. We paid a very dear price for that.”

Congratulations, Mr. President, your economic plan is so invasive that Russia’s Prime Minister - and the man widely “credited” with bringing tyranny back to that land – can actually criticize your policies from the right.

If that isn’t a sign to rethink what you’re doing . . .

Democrats in House subcommittee vote down Kaine’s tax hike 3-2

Tim Kaine’s tax hike was shot down by a House Finance subcommittee.

However, there is one thing the Roanoke Times did not tell its readers (and thus even Jerry at From on High may have missed it) – among Democrats on the subcommittee, the Timmy-tax lost 3-2.

Oh, and it’s nice to know the Times can’t count.  The actual vote was 9-2, not 8-2.  No wonder Jerry can’t stand that paper!

For Augusta County: 46 cents and not a penny more

The Waynesboro News Virginian (h/t SWAC Girl) has performed two great services today.  First, they called for Augusta County Supervisors to stick to the post-assessment equalized rate and save Augustans from a property tax increase:

Supervisors, if they felt the pain, could ease it by voting to reduce the tax rate to keep revenues level with last year, something Tracy Pyles of the Pastures District has urged but has failed, so far, to gain backing for from the other half-dozen members of the board. That would require Augusta to survive, somehow, on $43.3 million in property tax revenues. Getting by with the same or less is the task of taxpayers. Forgive them for feeling the government they fund ought do likewise.

I wish the editors of our local paper here in Spotsylvania (The Free Lance Star) had been so wise.

The other important thing the WNV editors did was set the bar for the equalized rate.  If it must be tweaked in the future, so be it, but there is at last a number around which a stand can be made:

Virginia law includes a windfall provision requiring that the rate initially be adjusted to prevent revenues from increasing by more than 1 percent after a reassessment. Supervisors then can vote to adjust the rate. Logic, fairness and simple awareness of the unique circumstances of our day require that supervisors leave the rate alone after the initial adjustment, which by our calculations would lower taxes from 58 cents to 46 cents per $100 of assessed value.

So there it is – the upper bound (as the statisticians would say) of acceptability for Augusta taxpayers: 46 cents.

Not a penny more.

Again for those of us outside Augusta, this is still a crucial fight.  All local governments will probably have at least one official looking to raise property taxes this year – with or without an assessment.  They will look to Augusta, because if a county thisRepublican – with a Republican majority on the BOS, no less – ends up with a tax increase . . .

That is a train we cannot allow to even warm up, let alone get moving.

Because I’m sure someone will ask . . .

Rusty McGuire (candidate for HoD: Contemporary Conservative) and I are not related.

Hey, that’s not part of the script!

As the elites of the world tries to put all that silly War-on-Terror stuff behind them, we are hearing more and more people discuss “talking” to the Taliban.  The president himself refused to promise victory in Afghanistan, preferring instead the squishy “hard-earned peace.”

One of the key elements in this wobbliness is the notion that American efforts to kill al Qaeda and Taliban operatives in Pakistan (which – to the president’s credit – are continuing under his watch) are angering Pakistanis and making the Wahabbists more popular there.  President Obama and most of his fellow Democrats used similar arguments against former President Bush the Younger vis a vis Iraq, but the rest of the world’s left has been pushing it regarding Central Asia as well.

Trouble is, no one bothered to ask what the people in the affected region actually thought, until now.  Farhat Taj talked to some residents of Waziristan and the Northwest Frontier Province (the two provinces that are Taliban havens) and finds furious locals (The News, emphasis added, h/t Bill Roggio at the Weekly Standard Blog):

The Pakhtun who experience the full range of Talibanisation, day and and day out, know that Taliban atrocities are not going to end with a dialogue. The Taliban have an agenda of a savage social order to be imposed on the people. The Pakhtun are not ready for that and this is the reason why they are bearing the brunt of the Taliban savagery. Hatred against the Taliban in the Pakhtun areas is at an all-time high and so is disappointment, even resentment, about the Pakistani army for its failure to stop the Taliban. All over the NWFP and FATA one can find people who even discuss possibilities of Israel and India to be asked for help. Their argument goes like this: “We are not killed by Israel and India. We are killed by the Taliban and the Pakistani army. So, who is our enemy, then?” Many people in the Taliban-occupied territories of the NWFP and FATA told me they constantly pray for the US drones to bomb the Taliban headquarters in their areas since the Pakistani army is unwilling to do so. Many people of Waziristan told me they are satisfied with the US drone attacks on militants in Waziristan and they want the Americans to keep it up till all the militants, local Pakhtun, the Punjabis and the foreigners, are eliminated.

Meanwhile, the Awami National Party, recently elected to lead the NWFP, is now admitting it has lost control of the Swat region to the Taliban (Daily Times).  As in Iraq and in Afghanistan, the people who suffer under al Qaeda are the ones most anxious to be rid of them, while the elites of the world wring their hands.

I know everyone loves to beat up George W. Bush’s democracy initiative, but there was a hard-headed reason for it.  He was one of the very few who noticed – or, to be more precise, took the time to see – the Afghan anger over the Taliban in 2001.  He had seen how the Cold War in Eastern Europe was won in no small part due to the bravery of the oppressed Germans, Czechs, Poles, and even Russians who finally saw an opportunity to seize their destiny and took it.

For the “realists” – even those on the right – these people never existed.  Neither did the Afghans determined to throw off the yoke of the Taliban (and they’re still there, BTW), nor the people of Iraq who came to America’s aid once it became clear we were serious about keeping al Qaeda andIran out of the country.  Now, the “realists” don’t see the people Farhat Taj does either.

But George W. Bush did.  I only hope his successor does, too.

The President bails out his DNC Chairman

OK, OK, Tim Kaine is not the only Governor whose state will receive a hefty check from Washington, DC (Center for American Progress, h/t Norm at TQ), but still . . .

Virginia:  Total Allocated to the state – $11.05 billion.

14.15 percent is set aside to balance the state budget.  The rest is marked for specific programs and tax cuts.

If you look at CAP’s map, you’ll see that every state is getting some allocation that will go straight to the budget.  All told, more than $62 billion will be sent straight to the state capitals.   This won’t stimulate the economy, it won’t generate any recovery; instead, it will simply bailout states that went on spending binges – like Virginia.

That said, Governor Timmy did manage to get something extra from the President: at 14.15%, Virginia’s budget piece is tied for the second largest in the union (Utah will get a 16+% allocation for its state budget, while Colorado stands to take in a matching 14.15% for its government spending).

Augusta Board meets Wednesday – that should be fun!

The first post-assessment meeting of the Augusta Board of Supervisors will be held on the 28th (Wednesday), and based on what SWAC Girl is reporting, it’s sure to be an . . . interesting meeting.

Despite the fact that Augusta has a Republican majority on the Board, only one member has spoken out in favor of an equalized tax rate – and that’s Tracy Pyles, the board’s lone Democrat:

“Instead of putting people through the ringer with reassessment challenges, the board should just adjust the tax rate to make it revenue neutral,” said Pastures Supervisor Tracy Pyles (emphasis in SWAC Girl citation, original from Waynesboro News Virginian).

Somewhere above it all, my late grandfather Mike McGuire – president of the Elizabeth City Council, friend of the taxpayer, and a Democrat his entire life – is smiling at Pyles.  The rest of us should be wondering what the four Republicans think they’re doing on that Board in the first place.

$100,000 a year: the new poor?

Jim Geraghty has this little jaw-dropper (bold emphasis added):

The Department of Health and Human Services announced today in the Federal Register its calculation of the poverty level for 2009. In 49 states and the District of Columbia, for a family of one, HHS puts the poverty level at an income of $10,830 or below.

2 persons: $14,570
3 persons: $18,310
4 persons: $22,050
5 persons: $25,790

For Alaska, it is a few thousand dollars more at each level. The rest of the chart can be found here.

I mention this because the House of Representatives has passed  legislation allowing states to offer government-funded health insurance to children who live in families that have incomes up to 400 percent of the federal poverty level. The Senate is expected to pass this legislation, and President Obama is expected to sign it.

In other words, barring the unforeseen, the President and Congress will allow state governments use your tax dollars to pay for the health insurance of households making $100,000 a year ($103,160 for a family of five, to be precise).  Given the experience we’ve had in Virginia, odds are most, if not all, of the states will sign up as many beneficiaries as they can, taking credit for it before the next election only to raise our taxes to pay the bill for it all after the next election.

Meanwhile, $100,000 – long the tripwire salary of “the rich” is now the new poor.  Who knew?

Leading economists OPPOSE the stimulus bill

Now it’s getting interesting.  For the first time that I can ever remember, the leading lights of academe in economics are coming out against a major government spending package (in this case, the Obama stimulus bill, or as it will be known here from now on, the Obamnibus).

Larry Kudlow has the details on his NRO blog (emphasis added):

In today’s Wall Street Journal, distinguished Harvard economist Robert Barro estimatedthat the so-called government-spending multiplier for GDP associated with peacetime government purchases would be “insignificantly different from zero.” While left-wing economist Paul Krugman rants on about opponents to Keynesian stimulus — calling them quacks — a growing list of prominent academic economists oppose the Keynesian approach. In yesterday’s Journal, economists Alberto Alesina of Harvard and Luigi Zingales of the University of Chicago rejected the Keynesian spending approach while suggesting that a capital-gains tax holiday would bring private investors back into the market.

Stanford economist John Taylor also opposes the stimulus package. So does University of Chicago’s Eugene Fama. So does University of Chicago Nobelist Gary Becker. So does New York University professor Thomas Sargent. And Harvard economist Greg Mankiw, who similarly opposes the Keynesian stimulus, has used his highly popular blogsite as a clearinghouse of opposition.

Why did I highlight Professor Sargent?  I did so because he was one of the pioneers of post-Keynesian economics.  It was his work that broke and then shattered the Keynesian consensus that Krugman, Obama, et al would like to believe is still in place.  Outside of the economist/academic community, he is little (if at all) known, but inside the community, he is practically a living legend.

In fact, the debate among economists in the academic sphere may have a lot to do with why I never managed to get so outraged about the PC takeover of American universities – because I so the exact opposite in my academic field – but that’s for another post.

Of course, it’s not just about saying “no”; Kudlow also offers the following prescription:

It really is time for the congressional Republicans to come up with a tax-cutting alternative that includes slashing the marginal tax rate for large and small businesses and individuals, and brings the investor class back into play. Not only with a cap-gains tax holiday, but also with a much larger capital loss deduction. Add to this immediate cash expensing for all businesses.

Right now capital is on strike. So are investors. Supply-side incentives will bring them back. This is where the GOP must go.

The last paragraph says it all.

The one reason I have not been willing to slip into gloom and doom mode is because I have noticed the economic “consensus” about government finally start coming apart.  There is actually a revisionist school of economic historians for the New Deal, the first time this has ever happened.  Now, with the above economists speaking out, the government-is-not-the-answer school has a reach and a depth that is frankly unprecedented.  Ronald Reagan could have had the political support to cut the budget in half if Harvard professors had been talking in his time the way Barro and Mankiw are now.

As it is, the new president really is in unprecedented political territory; for the first time, the pillars of left-wing economic thought are under serious attack from part the nation’s “elite”.  It probably won’t stop the Obamnibus, but it could mean future big-government boondoggles don’t have the political support everyone thinks they will.

The question is, can the national Republican Party get out of its crouch, shake off the hangover from the drunken spending binge, and do its part to build and represent the new limited government coalition?

Bolling puts House GOP transportation plan and budget transparency on his agenda

Lieutenant Governor Bill Bolling released his legislative agenda today.  Two things stood out amongst the list:

Online Budget Transparency- (HB 2285 – Cline / SB 936 – Cuccinelli) – This legislation would require the Commonwealth of Virginia to design and implement a budget website that displays a clear, detailed and understandable issue level budget.  The state budget is currently posted on-line, but citizens can only obtain very general information about budget expenditures, as opposed to detailed and specific information.

I haven’t harped on this as much as Rick Sincere or the folks at TQ, but transparency is the first step to moving from accounting to accountability in budgeting.  It’s good to see Bolling agrees.

 

The other one that caught my eye was the Oder transportation bill:

Transportation funding and administration for Hampton Roads, Northern Virginia, the Richmond Highway Construction District, and the Staunton Highway Construction District.  (HB 1579 – Oder)   This legislation would provide additional funds for transportation in Northern Virginia and Hampton Roads by capturing a portion of the economic growth attributable to the marine terminal for Hampton Roads or Dulles International Airport and the Ronald Reagan National Airport for Northern Virginia and dedicating these funds for transportation projects in these regions of the state.

This is the creative Republican plan that not only funds transportation without new taxes, but actually ties transportation funding to economic activity (a critical way of ensuring a necessary funding stream).  Again, to see the Lt. Gov. put this on his agenda means the Republicans in Virginia are serious about proposing real alternatives to the taxaholic Democrats.

 

The Republicans are building on the progress made in the special session (when this idea first came up as the new and very improved HB6055), and Bill Bolling is leading the way.