It’s The Economy, Stupid! (Part II)

John Schnatter began working in pizza parlors as soon as he was old enough to work. He went to college and worked at getting a good education. At age 22, he sold his 1972 Camaro Z28 to buy out the partner at his father’s pub, Mick’s Lounge, and turn it into the first-ever Papa John’s Pizza place. Today, he commands a chain of some four thousand franchisees and has a net worth of $600 million.

Schnatter worked hard for everything he has. Now the government is requiring him to add nearly $10 million a year to his operating costs, taking another 10% bite out of his profits. You see, while the company brought in $1.218 billion last year, it shelled out $1.131 billion in operating costs – a gross profit of $87 million. That’s before taxes. Schnatter himself has spoken out against the Obamacare mandate. Now that Obama has been re-elected, he’s said that he’ll have to cut some employee hours to avoid losing profits.

Liberals are calling for a boycott of Papa John’s now. Their beef? “He’s worth $600 million! He can afford it!” When he said he’d have to raise the price of his pizzas by 10-14 cents a pie, the left mocked him. “Oh, ten cents a pizza! That’ll really drive business away!”

And the left wonders why I’m so derisive when I talk about economic issues.

A large business that makes tens of millions of dollars can’t necessarily afford to lose more of their profits; $87 million wouldn’t even keep the company afloat for two months if things went bad. Schnatter’s own fortune wouldn’t even keep the company afloat for six months – a fair-sized portion of his net worth resides completely in the 6.1 million shares he owns in his own company. If they were to go under, his net worth would all but evaporate. Not to mention the losses he’d incur just trying to salvage what was left. The price of his pizzas would go up by about 10-14 cents per pizza on average; that doesn’t break down the rise in price for everything on the menu, because the price of some items would rise more than others. While Forbes talks about the cost only rising by a certain amount based purely on the health insurance costs, what their writer didn’t take into account are the other companies that Papa John’s buys from – particularly food and packaging companies, all of which must also offer health insurance to employees who weren’t eligible or didn’t sign up before. That adds to his cost because those companies raise their prices as well. They, like all other companies, have to find a way to recoup lost profits. Too much of a hit and the company is no longer as profitable for investors – they start selling off and take their business elsewhere.

You see, there’s more to this than simply a guy who is supposed to be worth $600 million. If any of the liberals who are boycotting Papa John’s (among other restaurants) right now had taken at least one economics class to supplement their studies in underwater basket weaving, they might have been able to deduce that there’s more to it than what they see on the surface.

In the last post, I talked about the higher cost that I, as an individual, am paying for my health insurance. I have a deductible that I didn’t have before. I pay more than twice per paycheck what I was paying five years ago. Liberals say that their goal with Obamacare is to provide preventative healthcare to those who supposedly wait until they have a medical emergency so that their costs don’t get passed on to us – the cost, however, is still getting passed on to us, and it’s more expensive than it was before.

Their way of doing this is to force employers to pay for health insurance for employees who don’t actually work full-time. Remember, for decades now full-time has been considered 40 hours per week. Anything over 40, and companies are required by labor laws to pay overtime. In one fell swoop, the Democrat supermajority in Congress and the White House managed to raise the federal minimum wage by two dollars an hour (from $5.25/hr to $7.25/hr) and require all companies to offer healthcare to all employees who work 30 hours a week or more along with the same law that requires every single person to buy health insurance and hamstrings a private industry by taking away their ability to determine who they want to risk covering. (Oh, and let’s not forget – part of the law requires 80-85 cents of every premium dollar to be spent on coverage itself, because the liberals can’t handle the idea of anything in healthcare turning a profit.)

What could possibly go wrong?

It all comes down to personal rights. The government made an incredible power grab when Obamacare was passed. They took power they did not have to force something radically unpopular on everyone. Our rights as a society took a massive hit when this legislation passed, and the consequences are becoming more clear as some of the deadlines in the bill race towards us. It’s all done in the name of altruism, the idea that everyone should sacrifice something to help and those who have more should sacrifice more. This kind of high-level socialism can only be very detrimental to a free-market economy. The Robin Hood mindset among liberals is doing damage that we may never recover from, and it’s all because the have-nots are angry with the haves.

Basing laws on what one side considers fair has never been a good idea.

Next up: the estate tax, and what it will really do if left unchecked.

It’s The Economy, Stupid! (Part I)

We all remember when Bill Clinton’s presidential campaign came out with that ridiculous line, but liberals are having some serious issues grasping rudimentary economic principles these days. Economics can grow into a complex subject, for sure, but there are some rules that remain very simple. The simplest of them all:

People go into business to turn a good profit.

I’m not talking pennies-on-the-dollar kind of profit. The type of person who goes into business for themselves spends a lot of time, money and effort on their education. They put substantial investments into their companies. Every entrepreneur takes a huge risk by starting a business, because they stand to lose quite a bit in the process. Most business owners do experience some failure before they become successful. Some owners lose everything and never find success. Those who do create jobs and pump money into the economy.

With that in mind, I’m struggling to understand how liberals are coming to the conclusion that major restaurant chains are cutting employee hours and other big businesses are starting mass layoffs solely to get revenge on Barack Obama.

I’m reading so many opinions about this thing that I’ve gotten lost in the madness. There are a wide range of expressions, ranging from the well-intentioned (“I can’t spend money with a company that would cut back on employee hours to avoid paying more”) to the breathtakingly stupid (“he’d only have to pay 14 cents per employee for their health insurance!”). I’m afraid I’m all out of patience for the misinformed.

What on Earth did any of you expect? You just had to pass that healthcare monstrosity. It was the most important thing in the world to you. Did you stop to think before pushing and then passing that legislation that there may be consequences? Did you not think that by forcing businesses to provide health insurance to all employees working 30 hours or more per week you might be increasing their cost of operating and, in turn, force them to find savings somewhere? It really is a simple concept, and you not only miss it, you assign blame to the most whimsical thing you can come up with.

I have the exact same health policy that I had in 2005. It’s the best policy my employer offers. In 2005, though, it literally cost me less than half what it costs now. As much as it costs me, my employer pays three times what I do for the policy – that’s on top of my salary. I used to pay $19 a paycheck. NOW I pay $52 a paycheck after three years of steep hikes. The health insurance bill you insisted must be foisted upon all of us is the reason.

Liberals had decided that health care costs were out of control and that something had to be done. Their brilliant idea was to force everyone to get health insurance, force insurers to cover all kinds of things that weren’t required before, eliminate annual spending caps and offer the Jersey salute to anyone even breathing the words “tort reform”. How is this supposed to help us? I still haven’t figured it out.

You said it was unfair for insurers to deny coverage because of pre-existing conditions, so now the law bars all of them from denying coverage for pre-existing conditions. The college kids who studied underwater basket weaving and couldn’t find decent jobs, along with the ones who didn’t go to college at all (particularly those who didn’t even finish high school), wanted to be able to stay on their parents’ insurance until at least age 26. Now the law requires that all insurers offer coverage to “dependents” up to that age, even if they don’t live with their parents. The hippies wanted their insurance to cover alternative therapies, including spiritual healing and acupuncture – things we’ve paid for out of our own pocket for eons. The feminists wanted their birth control for free because they forget to take the pill half the time, so they insisted on forcing coverage for much riskier forms of birth control (ever hear of pulmonary embolism?). And just to make sure we’re all being responsible citizens, you’ve banned insurers from charging co-pays for services that fall under the “preventive care” category.

You weren’t willing to enact tort reform to dramatically scale back the constant abuses on medical malpractice suits, but you just had to have all this other crap in the bill. The federal government is supposed to subsidize some 30-odd million people getting health insurance now, too – and it’s supposed to be paid for by massive cuts to medicare (that aren’t supposed to exist) and higher taxes on the very same business owners we’re forcing new costs on in the first place.

It’s no wonder our costs have gone up. Ostensibly, this was dreamed up for two reasons: first, making sure health care coverage is affordable. Because you insisted on forcing insurers to cover everything but a trip to the moon, fat chance of it ever being affordable again. Second, you wanted to control the price of healthcare due to those who are uninsured. The uninsured go to the ER for everything under the sun, from hangnails to the sniffles (thereby negating the purpose of an EMERGENCY Room), and when they stiff the hospital on the bill the costs supposedly get passed on to patients who ARE insured, right? So this new bill is supposed to cure that – the problem is that it drives up the cost of my premiums and gives more incentive for my employer to tweak my plan to include deductibles (meaning I pay more out-of-pocket – I didn’t have a deductible back in 2005). I’m now paying a lot more than I was paying before.

Anyone who really thought this would not be the end result of enacting the steaming pile of excrement that is the health insurance bill was either lied to or willfully ignorant. The worst part about the whole thing is that they did it “because it’s the right thing to do”, implying a moral need – the very same thing they castigate conservatives for.

Next, in Part II – how it all affects businesses

The Amazing Disappearing Middle Class

America is the only country on the planet where the poor have cars and cable TV. If you’re listening to the so-called “99%”, better known as Occupy Wall Street, the middle class in America no longer exists. They say it was decimated by the financial crisis. If the middle class is truly no more, though, then I’m about to have a serious identity crisis.

I’m pretty sure I’m not poor. I’ve seen what poor is and it ain’t me. I have two good jobs, I make decent money, and I have a great little apartment where my only complaint is my noisy neighbors. I have uninterrupted electricity, clean running water, a washer and dryer, a refrigerator, and air conditioning in the middle of the desert. I have a nice little Ford pickup truck that I can take up to Sedona or Crown King when the mood strikes me. I have a big TV, a PS3, a sizable movie and game collection, a custom computer, high-speed internet access and three guitars – including my dream guitar, a Taylor. I have a cat who only gets Iams or Science Diet. I’m a TAM (Tammy Army Member) and I make donations to the ASPCA, the National Fallen Firefighters Foundation, the 100 Club, and the Anthony Holly Foundation. I’m certainly not hurting.

On the flip side, I wouldn’t consider myself wealthy, either. I can treat myself once in a while to a good steak, but it isn’t at Donovan’s. I don’t wear designer clothing (unless you count Black Helmet and RangerUp). I have a Taylor (top-of-the-line, hand-made guitars built right here in America by a fantastic capitalist named Bob Taylor), but it’s not made of solid koa and I can’t afford one of those in the near future. I’d love to have a fully restored ’67 Shelby GT Mustang and a Harley-Davidson VRSCDX Night Rod Special, but both are a pipe dream. I can’t just blow money on whatever my heart desires no matter how much I drool over these things.

So we’ve established that I’m neither poor nor rich, not by any stretch of the imagination. I’m not alone; the majority of my friends and relatives don’t fit into either category. If I’m not middle class, then what am I?

I’ve said many times that the liberals in this country are masters of misinformation. 9/11 happens and patriotism ends up being warped into Islamophobia. After eight years of tacit refusal to obey the terms of his 1991 surrender, we go take out Saddam Hussein and we’re called murderous warmongers who need to give peace a chance. An economic crash brings us to our virtual knees and it’s all the fault of the president who warned that it was coming – and the career politicians who blew him off are swooping in to rescue us. A Tea Party movement finally stirs to combat all of these lies and they’re pegged as racist, hatemongering bigots who goose-step to a capitalist beat – never mind that the REAL Nazis were actually cut from the same socialist cloth that today’s liberals are (hence the Nazi party name, in English: National Socialist German Workers’ Party).

The Occupiers are typical emotional Americans who have no idea what “poor” really is. Even when I was making half what I make now, pinching every penny to make ends meet and find some way to save something, I wouldn’t have called myself poor. Not being able to go to the movies, have a smartphone, carry a Coach purse or get your nails and hair done does not classify as poor. Go to Mexico, Jamaica, or Haiti, where you have to know someone or have money to get a job – qualifications be damned. Nobody earns anything on merit in those countries; if you’re not connected or greasing a few palms, you’re doomed to a life without plumbing or electricity. Basic education is spotty at best. College? Yeah, right.

The reality is that this movement isn’t about “the rich getting richer and the poor getting poorer”. It’s not even about equality of opportunity. It’s a group of people who feel they’ve been cheated out of an equal outcome with those who are wealthy. It’s being funded and supported by avowed communists and union thugs – and like the Bolsheviks and Nazis before them, many are getting paid to make this statement. Buy a revolution and lie enough to the right people and eventually the truth is lost.

The middle class is, believe it or not, thriving. Don’t buy the hype. I am among the last of a dying breed, but that breed ain’t the middle class, and I can be proud enough to say that I have earned what I have and didn’t take it from anyone else.

Breaking News: This Ain’t The First Time

Ann Coulter brought up an important part of history I had forgotten. The Occupy Wall Street protests are going a month strong now, and the same press that called Tea Partiers names that ought not be repeated in a professional office (and certainly not on TV) are comparing the communist uprising of this generation to the Tea Party. Here and I thought the Tea Party was so evil it could not have a link to the hippies.

They can’t figure out what the hell they want. I’ve heard them answer the “what do you want” question with all manner of responses, including everything from an investigation into 9/11 to an end to greed to “hang[ing] and shoot[ing] the Bush administration”. No joke. We’ve seen protesters defecating on police cars. We’ve seen signs that make no sense. We’ve heard calls for greedy businessmen to go to jail. And we’ve seen the owners of Zucotti Park – a privately-owned park on Wall Street with archaic rules such as “no pitching tents” – tuck their shafts between their cheeks and run away when asked if they’ll ever pitch the occupiers out of the park.

(You’ll pardon the crude humor, but I DO spend a lot of time with cops, firefighters and soldiers. If you thought we were all innocent…)

Major unions have paid people to go protest. Union heads have screamed for the blood of wealthy businessmen. They’re upset about outsourcing, foreclosures, problems with the stock market, having to move back in with mom and dad, not having a degree…they’re just mad as hell, and nobody will ever stop them from using their voice, dammit! There’s just one problem with this whole thing. The bible makes a very good point: “Is there anything of which it may be said, ‘see, is this new?’ It has already been in ancient times before us. There is no remembrance of former things, nor will there be any remembrance of things that are to come by those who will come after.” (Ecclesiastes 1:10-11)

What these anti-capitalist occupiers don’t realize is that this isn’t the first time a movement has risen in America out of anger with lenders and other businessmen, including those who foreclose on mortgages. They would have known that if they’d paid attention in history class when Shays’ Rebellion was taught (of course, that’s assuming that schools still see fit to tell kids that it happened in the first place).

In 1783, America took a leap toward her legitimate revolution becoming the bloody travesty that was the French Revolution. Daniel Shays, a veteran of the Revolutionary War, left the Army without being paid only to get home and find himself on the verge of having his home in Massachusetts foreclosed on by the mortgage holder. He also faced time in debtors’ prison. Over a span of years, Shays recruited friends and relatives – many of them fellow veterans of the war – for a massive protest. First they began by petitioning the state legislature and the courts to stop foreclosures; a large number of veterans were facing the same fate. Part of the problem was that they hadn’t been paid much for their service in the war; a large part, however, was that many of the lenders, most of them French, demanded payment in gold and silver – things that they didn’t have much of in the Republic at the time. It simply wasn’t possible to repay the debts in silver and gold.

In the middle of the protesting, one member of the uprising, Plough Jogger, said, “The great men are going to get all we have and I think it is time for us to rise and put a stop to it, and have no more courts, nor sheriffs, nor collectors nor lawyers.” Replace “the great men” with “the rich” and what have you got?

It was in August 1786 that things turned really violent. The occupations that had been intended to peacefully shut down courthouses in Massachusetts to stop judges from handing down the very rulings that would order foreclosures and evictions became a violent uprising. Shays led his rabble to seize the armory in Springfield only to be met by the state militia; the general of the militia fired directly into the protesters, killing a handful and wounding about two dozen. The rebels scurried away without firing a shot. Daniel Shays himself had been sentenced to death but was pardoned by governor James Bowdoin. After spending more than four years of his life blaming everyone else and screaming for the government to do something about it, Shays died in relative obscurity in New York and was buried in a potter’s field.

Shays actually had a serious grievance. Back in those days, we didn’t have a federal government in place to regulate lenders. He came home from helping to free his country and was told that he no longer had a home. How fair is that? His response, however, was what got him into trouble. It was that very rebellion that pushed our founding fathers to create a centralized federal government with the power to regulate the financial industry, particularly lending. Thomas Jefferson was just about the only one who objected. It was at the height of Shays’ Rebellion that he penned the famous words, “The tree of liberty must be refreshed from time to time with the blood of patriots and tyrants. It is its natural manure.”

Nowadays, we have a government big enough to take care of entire swaths of citizens. We don’t have soldiers coming home from war and not getting paid for their service. Banks don’t demand payment in precious metals. We don’t have debtor’s prison anymore. We even have courts that may side with a debtor and order a bank to cease and desist in the midst of foreclosure proceedings. Public opinion has become so fierce in recent years that JP Morgan Chase, one of the three biggest banks in the nation, has backed off of several foreclosures, particularly on mortgages owed by military families. Yet despite there being many ways to find relief, we still have hordes of people occupying Wall Street to decry capitalism as evil. The one thing that I find absolutely hilarious is that celebrities are coming out in their designer clothes and protesters are using the very devices of those evil, greedy corporations to social network their way into the history books as the most ridiculous display in US history.

Ecclesiastes said something else that I believe applies to this movement. “As I set my heart to seek and search out by wisdom concerning all that is done under heaven; this burdensome task that God has given to the sons of man, by which they may be exercised. I have seen all the works that are done under the sun; and indeed, all is vanity and grasping for the wind.” (Ecc. 1:13-14)

Economics Just Aren’t Sexy Enough

“If you don’t read the newspaper, you are uninformed. If you do read the newspaper, you are misinformed.” -Mark Twain

Matt Damon was captured on camera defending all teachers as angels and our educational system as a modern marvel. When caught in an error and called on it, he became indignant and spit out expletives to defend himself and his mother (who, coincidentally, is a teacher). Never mind the fact that public education in America falls well below the standard in other countries. Never mind the fact that kids that I went to school with managed to graduate despite being damn near illiterate, and it’s only gotten worse since then. Never mind the fact that our public schools churn out violent thugs with an efficency only a prison could admire. And please, never mind that guy doing that horrible rap calling achievement a “crime spree”.

We now have a generation coming up that cannot bother themselves to understand the facts before deciding what they believe – and basing it entirely on their feelings – and our celebrities are defending our educational system as above reproach. It’s almost as if they want things to be this way.

So, naturally, as soon as Standard & Poor’s, the famous credit rating agency, downgraded the US credit rating, the MSM began trumpeting the Democratic Party’s view that the decision to downgrade was a “flawed”, “facts-be-damned” decision based on so-called fuzzy math. It’s easy for the Democrats to say that; they’re going to do what they must to defend their positions. The MSM is practically owned by liberals, so they are going to spit out what Democrats feed them. Then, all of these folks who don’t want to lose precious time learning actual facts will take such claims as gospel, believe them wholeheartedly, and parrot them unfailingly.

Then, when you hit them with facts, they’ll come up with some pretty outrageous stuff – arguments such as, “how come S&P didn’t downgrade the credit rating of all those subprime mortgage beasts but they’re downgrading the country’s credit rating now? They’re hypocrites!”

Here and I was hoping for a real challenge.

The role of a credit rating agency is pretty simple. They assess risk. That’s it. They look at a handful of factors and determine the risk of granting credit to a person, company or government. We all know the three major credit bureaus to be Equifax, Experian and TransUnion, and for the most part we all understand what they do. They take our income into account, look at the debt that we’re paying (including mortgages, rent, car loans, credit cards, etc.), and issue a score that companies use to decide whether or not to issue us a new line of credit falling into one of the aforementioned categories. Companies also use those bureaus to determine a job candidates’ eligibility. If the risk is too great – meaning we’re not making enough money to pay our debt or not paying the debt on time without taking out more debt – our score dwindles and most companies won’t grant any new credit. Experian doesn’t take it upon itself to examine the investments I’m making and whether or not I’m taking a risk there; if they did, my credit rating would be better than it is.

Nor is it the job of larger-scale credit rating agencies to make a determination of the risk of investment being made by a company or a government.

Take a look back at the beginning of subprime mortgage as we knew it. Alan Greenspan went on TV and essentially told the country, everybody, from peons like me to the CEO’s in mansions, that investing in real estate was a flawless move because once people buy a house and move in, they don’t want to move out – ever. It’s a pain, he said, so turn your attention to mortgages.

Banks and other lenders began to look more closely at a very convenient piece of legislation known as the Community Reinvestment Act. In 1977, then-president Jimmy Carter signed into law the act that would make it a crime for any lender of any kind to red-line risky neighborhoods and required those lenders to, in effect, accept a certain percentage of risky lending as a requirement of being in the business. In essence, the government stepped in and guaranteed that people who were not credit-worthy obtained credit anyway, facts be damned. Sound familiar?

Entire companies sprang up to take advantage of a whole new opportunity: subprime lending. It’s an infallible investment, right? Nobody wants to move out of their house. They’ll do whatever they can to keep it. So let’s lend to anyone and everyone because the government has sanctioned it. Oh, even better, once we get these mortgages out there, let’s create a whole new type of security investment based on packages of these mortgages and ignore the credit-worthiness that they’re based on! We’ll be billionaires overnight!

Everyone got on that get-rich-quick scheme just as quickly as they got on the dot-com train. They failed to recognize the exact same indicators of a pending doom that George W. Bush tried to warn Congress of as early as 2003. Bush, while I sincerely disliked his fiscal policies, had few options on what to do. People on BOTH sides of the aisle failed to see what was coming, and as long as everyone was rolling in money, it didn’t matter whether they had an R or a D behind their name – nobody was willing to ruin a good thing. As long as real estate was popular, values were driven up so high they were astronomical. Eventually they could only go one way. Something rising that rapidly will always, without fail, suddenly stop and plummet.

It’s damned easy now to look back and see what was wrong with it. I dare ask how many of these screaming liberals also bought into that scheme only to see the value of their property drop like a rock after cashing out the inflated value of their homes and ending up owing nearly twice what the property was really worth. Everybody was to blame, but not one person has acknowledged the fact that a Republican pointed out the pending doom and a Democrat (Barney Frank) shot him down by waving off the warning as baseless.

S&P, Moody’s and Fitch were not tasked with determining the risk of their investment. Their role was to examine what was on the books of those companies, how much business they were doing, and give them a rating based on the risk of issuing credit to those companies. When there was a hell of a lot of money in it, it was impossible to expect them to downgrade those companies because, at the time, there was little to no risk in issuing that credit.

The federal government, on the other hand, doesn’t have enough money to back themselves up. They are spending too much money and are refusing to cut back – in fact, they’ve only spent more than any of us could have imagined. Democrats want to crucify Bush for the bank bailout, and I disagreed with it, too; we were going to feel the pain of that crash one way or another. They are conveniently forgetting their role in the disaster and are using smoke and mirrors to deflect the blame on everyone but them. They are covering up the fact that by refusing to do something early, they left Bush with few options on how to fix the problem. And now that they are in a position of power, they are holding the economy hostage and blaming the Tea Party with accusations of terroristic hostage-taking.

Unfortunately, no liberal will come close to seeing these realities even if they do read this. Why? Because unless Hollywood can make a realistic movie about economics and make it look sexy, they just won’t be interested enough to educate themselves. So we end up with a generation being fed by Matt Damon and Sean Penn how to stop caring about their own achievement and care more about their feelings – and the rest of the world prepares to eat them alive. It’s more important to stick up for a feel-good ideal and throw money at something than it is to fix it and teach the people involved to make something of themselves that doesn’t include daydreaming of being a movie star and not needing a real education.

Business As Usual

Despite being punch-drunk in love for the past two weeks in a whirlwind of a new relationship, I have still managed to catch all the news about the deficit flap. Republicans come up with a plan, Democrats shoot it down, Republicans ask Democrats for a plan, Democrats simply sneer. After eight-hundred-odd days of not having a solution to the debt crisis, talking heads claimed we were nearing a default on our debt. Republicans and Democrats alike scrambled to find something they could sign so they could all say, “see? We really are doing our jobs!”

Oh, gag me.

Rather than trying to get spending under control, the only thing either side has managed to do is make a bigger mess of things. While some of the finer points may be complicated, the general idea is still quite simple: you and I, John and Jane Q. Taxpayer, have to live within our means. We have to live on a budget. We write it all out usually, starting with the bills we owe, subtracting them from the amount of money we’ve earned, and delegating the remainder to different categories, usually simple things such as groceries, savings, and extra spending money. We know that if we don’t save up we may end up in the midst of a crisis with little to no money to help ourselves. When that happens, we may take out a loan or credit card to cover the crisis and pay it back over time as we can. When I landed in the hospital a few months ago in need of emergency surgery, my insurance covered all but $1800; if I’d had no savings, I would still be in debt.

Some folks don’t know how to manage their budget and end up with tens of thousands of dollars in debt on top of a mortgage that easily tops $200,000. They end up spending the rest of their lives treading financial water, trying to pay off credit cards and loans that they didn’t consider the affordability of when they took them out. Many end up declaring bankruptcy at least once, some of them multiple times (former MCSO chief deputy Dave Hendershott famously declared bankruptcy three times in his personal finances while nearly tanking MCSO’s budget). All of these people end up in serious legal trouble with creditors and government agencies alike. They don’t know how to live within their means, much less plan for the possibility of a crisis that can be costly.

The federal government lost the ability to live within its means right around the time George Bush Sr. took office.

The deal that was struck was not an argument about debt reduction – it was about deficit reduction. There’s a distinct difference. Debt is the amount you owe. Deficit is the damage done when you’re operating in the red; in other words, how much money you’re losing in a given year because you’re spending more than you’re getting. When Bill Clinton took office, his famous tagline was “it’s the economy, stupid.” Yet Clinton still managed to raise spending during his tenure by more than $520 million over Bush Sr.’s spending.

Bush Jr. was far worse – he raised spending by $1.6 trillion over Clinton, though it took him eight years to do it. Thus far, Obama has raised spending by a whopping $4.3 trillion over Bush’s spending in a mere three years. That means federal spending has gone up by nearly six trillion dollars since the days of Bill Clinton. There has been plenty of anger here at over Bush’s terrible fiscal policies, but liberals have far outdone Bush in less than half the time. The only thing they’ve offered is a cheap one-liner: “they drove the car into the ditch, now they want the keys back!”

Again…gag me.

If the government is pulling in $175 billion in revenue from taxes alone every month, that gives them $2.1 trillion annually (estimated). That’s just in taxes from you and I. Where is the money going? The government has a few essentials: immediate infrastructure (such as Congress), military, federal-level law enforcement and corrections, and federally-kept interstate highways. What else are we paying for? Medicare, social security, and a host of government-sponsored programs, most of which have a plurality (particularly education). We send billions to other countries annually, including to Brazil to do the offshore drilling that Obama doesn’t want going on near America’s shores.

Why are we spending so much money on non-essential programs? Well, that depends on who you ask. There’s not a liberal alive who is willing to call any government program expendable unless it has to do with the military. To a liberal, it is unthinkable to get rid of entitlements. Of course, we’re talking about liberals, many of whom have put Republicans to shame in the era of earmarks (which is saying something, because there are some Republicans who have managed some pretty silly earmarks). Why should the federal government fund a Woodstock museum? Damned if I know, but Hillary Clinton wrangled an earmark for it.

(As an aside, you can get a liberal to agree to an earmark for the Woodstock museum, but they’ll scream bloody murder if you start suggesting that the government pay for a few hundred kids to attend private religious schools. Not that I think the government should pay for that, but hey, at least those religious schools don’t churn out illiterate thugs the way government-run schools do.)

I’m an EMT-I currently going to paramedic school. I was told back in 2005 when I started my original EMT classes that it wasn’t a matter of if I’d get sued, but when. Eventually, no matter how good you are, you’ll get sued by someone who didn’t get the outcome they wanted. Did you c-spine a patient correctly while they still ended up paralyzed? Did you go to a child drowning and bring that child back to life only for them to be declared brain-dead at the hospital? You’ll still get sued, they told me, and I’ve seen friends who did everything right end up in court defending themselves from money-hungry lawyers and their clients who are simply looking for their lottery payment. That comes from the idea that the government has endless pockets. People really, honestly believe that the government has an endless supply of money that they can hand out at will, all they have to do is get in line. That couldn’t be further from the truth. The government can’t keep shelling out money like candy any more than you or I can.

Why in the name of Thomas Jefferson are we talking about reducing the deficit and raising the debt ceiling rather than going beyond that and reducing our debt? Both sides are being complete idiots here. There are tax-exempt organizations fronting as quasi-political organizations for both sides (i.e. the Heritage Foundation, Media Matters) that should have their tax-exempt status revoked. That status was created for charities, not for front groups who funnel money from elitists to certain political groups. As incentive, we should enact term limits and stop people from holding seats for entire lifetimes. The government should get out of the charity business and leave the charity to those who wish to offer it. Unemployment should not be unending. While we’re at it, I think those who accept government handouts should not be allowed to vote. Liberals need to stop labeling all conservatives as terrorists for simply wanting some commonsense rules to be applied to the Beltway.

Business as usual cannot continue or the government will end up in the same predicament as those people who continually take out new credit cards when they run out of money: destitute.

It’s the economy, stupid.

Where Are The Jobs? (Left vs. Right)

In response to a voter’s question in August of 2009, President Obama said:

Normally, you don’t raise taxes in a recession, which is why we haven’t and why we’ve instead cut taxes. So I guess what I’d say to Scott is – his economics are right. You don’t raise taxes in a recession. We haven’t raised taxes in a recession.

Oddly enough, conservatives are still shying away from indignant liberal cries: “Where are the jobs?” when they attempt to underscore the success of the Bush Tax Cuts including raising revenue to the Treasury 785B by 2007, adding 8 million jobs to the economy, and increasing the median household wealth by more than $20K.

But what about the Lamestream Media who constantly allows the White House and Democrats in Congress to escape their drunken spending spree which took place in the last three years including the failed stimulus and the ObamaCare travesty?  “Where are the jobs?”  Trillions of dollars of feckless spending, unemployment did go above 8%, and revenues to the treasury are at historic lows.  Yet, Obama, Pelosi, and Reid are allowed to escape on their loose versions of a series of “what-ifs?”

Can you imagine what would have happened if we weren’t allowed to fecklessly spend trillions of dollars in historic amounts of time? If you thought unemployment was bad now, you wouldn’t believe what it would have been if we hadn’t printed billions of valueless paper and created a few temporary Census jobs!

Listening to the House today during the debt-ceiling debates made me ill.  After it being crystal clear, not only proven by President Bush but also by President Reagan, that tax cuts and deregulation creates millions of jobs, liberals are still allowed to deny the benefit of the doubt to tax cuts but get to hand it over no- questions-asked to excuse the most unbelievable spending ever in the history of our government.

This is common sense.  This is what we must continue to remember as our party heads into the 2012 battle for the White House and the Senate.

America is broke.  We need politicians who are going to respect Americans by being honest with them.  Clearly, the accounting tricks, gimmicks, and experiments of the left are not prepared to do that.

All The King’s Horses

I’m from Houston, Texas. I’m pretty sure that comes with a requirement to be a die-hard Astros fan and sincerely dislike the New York Yankees (I don’t like to use the word “hate” – I disliked using that word long before it was cool). So, I was largely disinterested when I heard that Yankee shortstop Derek Jeter hit his 3,000th ball, and homered at that.

At least I was disinterested until I heard about the fan who caught the ball.

23-year-old Christian Lopez caught Jeter’s record-setting ball and promptly gave it back to Jeter without any strings attached. He didn’t ask for payment, though he could have sold the ball on eBay and made off like a bandit. At least then he would have been able to get some kind of monetary value to pay the IRS off with.

You won’t believe what came next. The Yankees repaid the fan with season suite seats and a host of autographed Yankee memorabilia, but experts say the value of the gifts is right around $120,000. That would mean he’d owe the IRS around $14,000 – $15,000 in taxes for the goods.

This just highlights a conversation my dad and I had last night about taxes. Right now, we have the Big O and his minions talking about raising taxes to take care of the trillion-dollar deficit. The government is spending money like a drunken sailor on a bender; rather than corral their spending, they’d prefer to raise taxes in the middle of a recession in which people are losing jobs and houses left and right. They’re about to commit fiscal hari-kari all because they can’t give up their socialist ideals long enough to do the smart thing. Urkel himself said recently that “the public is not paying close attention to the ins and outs of how a Treasury option goes. They shouldn’t. They’re worrying about their family; they’re worrying about their jobs; they’re worrying about their neighborhood. They’ve got a lot of other things on their plate. We’re paid to worry about it.” He is saying here that professional politicians know best.

Don’t worry, John and Jane Q. Taxpayer. We’ve got things under control. Your job ends at the ballot box, we’ll take it from here. It’s just too complicated for simpletons like you to understand. Let us do what we’re paid to do and take care of the small things. What’s that? You don’t want to pay taxes that high? Well, you wanted us to do this job. Pay up and let us do it.

Stop right there, homeboy.

It irritates me that we pay so damn much in taxes and we get next to nothing back for it. We pay taxes through our paychecks, and any paycheck that you get on top of the norm (which I do in the form of bonuses every month when I do a particularly good job), they go from taking 22% to taking 45%, sometimes even 50%. Separate from that, our paychecks are automatically hit with taxes for Social Security and Medicare, neither of which were ever supposed to be requirements. Then we get hit for state taxes. Those aren’t the only taxes we pay, but you don’t see most people paying attention to it. We pay sales tax on nearly everything we buy, and there’s a movement to force internet retailers to levy sales taxes now, too. We pay taxes on the bills we pay for water, sewer, electricity, cable, phone, and rent. Homeowners pay a separate tax based on the value of their property, both to state and federal governments.

We even pay taxes just to friggin’ die. Is this really what our Founders had in mind?

Now we have Christian Lopez getting gifts from a sports club because he did something entirely selfless in giving a very valuable piece of equipment back, and the IRS is already salivating. Since when is this acceptable?

The government needs to be cut off. They’re behaving like a trust fund kid on a shopping spree, yet we’re hemming and hawing about cancelling their credit cards. Really? Why is this so difficult? No more endless unemployment benefits. No more duplicate programs (or eighty of the same program across sixteen agencies, half of which have nothing to do with the programs they’re administering). No more healthcare monstrosities that Congress gets a free pass from. You live exactly the way we do and follow the same rules or you get kicked to the curb like the abusive ex that you are.

I have no illusions, however, that we are capable of doing what Thomas Jefferson called our duty and resisting when injustice becomes law. We’d rather feed all the king’s horses than set them free.

How Do You Spell “Union”?


Just a week ago, Mark wrote quite eloquently on the subject of the public worker strikes in Wisconsin:

Today, most labor unions are very similar to the “evil corporations” they so frequently rail against. They claim big business doesn’t care about its workers, only profit. But are unions any different? They need members to pay dues, or they cease to exist. Clearly they are also profit-driven. They believe industry has too much influence compared with the working class. But unions have far more influence than their numbers would suggest, given that only 8% of Americans are in unions. And what do many of these labor organizations do with the hard-earned dollars they take from their members in the form of dues? They give them to politicians running for office – almost exclusively in the Democratic Party – whether their members support them or not.

The bill being bandied about in Wisconsin, AB-11, would end collective bargaining rights for state employees (excluding public safety workers), require that state employees pay more than the paisley 5% they’ve been paying for health insurance and the ridiculous 2% they’ve been paying for their pensions, and would cut medical services to the poor and uninsured. During all the brouhaha going on at the state capitol, this woman was filmed to make a statement:


Don’t worry, dear damsel! Obamacare will save you!

First of all, we all need to understand something: corporations can simply go out of business if a union or special group continues to push for what they cannot afford. Government bodies – local, state or federal – cannot go out of business. They are unfortunately necessary to survival in our country. While corporations will do nearly everything to save face all the way to the bankruptcy line, governments that need to save money start cutting things from the budget. What does that mean? It means that in governments such as those in Europe, which have multitudes of entitlement programs to include socialized healthcare systems, they simply start cutting out things they can’t afford. It usually starts with healthcare; what Sarah Palin dubbed “death panels” are bureaucratic panels that convene to determine what they can change and how they can shuffle things in an effort to cut costs. Since healthcare workers are already paid peanuts, they start with services. Are you too old to benefit from a transplant or chemotherapy? Sorry, the state can’t afford it, especially since you probably won’t go back to work when you recover, anyway. We’d rather spend that money on a teenager who will benefit us more. Is your prognosis too grim? Sorry, we’re not going to pay for any treatment at all because you’ll die anyway and it would be a waste. Do you have a minor illness? Well, you’ll wait a while to be seen, we only have doctors available during certain hours and they have to triage their patients. Once you have pneumonia give us a call.

How does this not make sense to people? We already have entitlements for welfare, unemployment, healthcare for the uninsured and all kinds of grants for college, the arts, and home buying. Our tax dollars are stretching thinner and thinner with every passing year, yet here we have left-wing moonbats still demanding that the government give us what they literally cannot afford. If we keep going down this road, we will one day find ourselves watching the US dollar collapse and the Democrats will still try to blame the right wing.

Greed is not solely a label for the wealthy. Every human being is greedy to some degree…it’s in our very nature to want to look out for number one. Even the Founding Fathers tried to remind us long ago that our rights end when they infringe on the rights of another – that means that when we demand we be recognized for the right to have what we want at the expense of the government and the government can’t afford it, the rights of the majority who ARE paying for it trump yours.

Common Sense Conservatism: Health Care Reform

“How can health care for everyone be a bad thing?”

Several months ago, one of my friends uttered this quote in an attempt to combat the negative press surrounding President Obama’s health care bill as it was being considered by Congress. The answer to that question, of course, is that health care for everyone is not a bad thing, it is a great thing. Sadly my friend missed the point, and so did many Americans: How do you pay for it when we’re $13 trillion in debt? Health Care Reform gripped the nation as yet another non-partisan issue was politicized for the sole purpose of damaging political opponents. In the end there was no winner; only losers: The American People.

Every issue has an upside and a downside. In 1986, the Emergency Medical Treatment and Active Labor Act required hospital emergency rooms to treat anyone in need of care, regardless of citizenship, legal status, or ability to pay. The upside was that patients were not turned away from needed health care. The downside is that “about half of all emergency services go uncompensated.” The best intentions of government resulted in a huge unfunded mandate to emergency departments nationwide and a loss of $4.2 billion in revenue in 2001 according to the American Medical Association. Nobody wants to see patients denied much-needed care, but how can the government pass laws that help some people and completely destroy others?

Health care reform divided the nation along lines defined by views of big government versus small, and compassion versus fiscal responsibility. At a time when the economy was the top concern for Americans, not health care, Congress unveiled a $940 billion bill which was passed into law on March 23, 2010. Republicans were once again labeled “obstructionists,” even though they didn’t have enough votes to stop the Democrats from passing the bill. Democrats called Republicans the usual names, accusing them of being racists, hating the poor and defending the rich.

Today, 60% of Americans favor repeal.

It seems as if every issue where Democrats and Republicans disagree ends with more Americans believing that the GOP is racist, anti-poor and pro-rich. Why are Democrats so good at convincing Americans of these stereotypes? I believe it is because Democrats tend to politicize with emotional buzzwords and headlines, while Republicans do it with logic. So, are Republicans heartless to oppose a bill that would extend health care benefits to 32 million Americans? Well, let’s consider some of the objections.

The government is notoriously inefficient. In a previous post I went over the resume of the U.S. Government in detail, including the tremendous successes (read: failures) of Amtrak, Medicare, Medicaid, Social Security, the U.S. Postal Service, the Ryan White CARE Act, and Fannie Mae & Freddie Mac. Even recipients of government funding like Planned Parenthood operate without oversight, as they apparently can’t account for $1.8 billion in taxpayer dollars received over the last decade. This isn’t a partisan problem. The government is inefficient under EVERY administration, which is why a majority of Americans prefer a smaller government. As it is, the bill is already estimated to cost $115 billion more than anticipated, and it hasn’t yet gone into effect.

It is simply a bad law. The health care law is designed to increase access to health care and lower costs so more Americans can afford to purchase health insurance. Correct? Does taxing the manufacturers of medical devices and brand-name prescription drugs help lower the cost of health care? Those increased costs will undoubtedly be passed on to the consumer, who is now forced to carry health insurance because of the mandates in the health care law – no matter what the cost! In fact, nothing in the new law controls the rising costs of health care. It does, however, force businesses to file a 1099 form for every vendor transaction of $600 or more, which creates a pile of paperwork for even the smallest businesses. What purpose does this serve in a health care bill? None! It has nothing to do with health care.

Going forward, individuals will no longer be able to claim medical expenses on their taxes that exceed 7.5% of their income. The new number is 10%, resulting in roughly $800 less in deductions for someone earning $25,000/year. President Obama said those earning under $250k/year wouldn’t see their taxes increase by a “single dime,” but if you can’t claim an additional $800 in medical expenses on your tax return, I think you’re out more than a dime. Medicare payroll taxes are also going up 2.35% for those earning more than $200k, and revenue from the increase in Medicare taxes will not be going to help save or fix Medicare. Medicare, in fact, is being cut by $500,000,000,000.00!

Then there are the mandates. Individuals will now be required to carry health insurance, whether they can afford it or not. Your coverage must also meet minimum government standards to “qualify” as an acceptable health care plan. The penalty for not complying will be as much as $750 per year for an individual, $2,250 for a family, or 2% of your income – whichever is higher. The employer mandates could cause some series damage. Employers who cannot afford to offer health insurance to their employees will pay fines, which could amount to $3,000 per employee, per year. This will unquestionably cause jobs to be cut and businesses to close. That’s a fact that cannot be ignored.

Of course we can’t forget luxury health care plans, called “Cadillac Plans.” These are plans that cost more than $8,500 per year for an individual. They’re great plans, but there will now be a 40% excise tax on them. Yes, that’s right – 40%. It is designed to go after the rich, but it is not indexed for inflation, which means in 10 years when all plans cost $8,500/year or more, everyone will be paying the 40% tax. Many union-negotiated plans are considered “Cadillac Plans,” but if you’re in a union you don’t have to worry about it. President Obama exempted unions from this 40% tax. For the record, only 8% of Americans are in unions.

The new law also allows the Department of Health and Human Services to create “qualified non-profit health insurance issuers” to offer health insurance, with federal grants, and exempt from federal taxes. It requires health care coverage information to be reported to the IRS, and provides funding to hire 16,000 additional IRS agents to ensure compliance with the individual and employer mandates.

What’s not in the bill? Tort reform for starters. We live in a lawsuit-happy society, and doctors must carry expensive insurance policies to protect themselves from frivolous lawsuits and mega-million dollar settlements. Those costs get passed on to patients, contributing to the high costs of health care. Republicans wanted tort reform included. Democrats argued it would not result in a significant savings, however it should be noted that trial lawyers donate almost exclusively to the Democratic Party. Another provision not included in the bill was the ability to purchase health care plans across state lines. This would increase competition and help lower costs, as we’ve seen happen in the auto insurance industry. Again, Democrats refused to include it after it was proposed by Republicans.

The House of Representatives requires 218 votes to pass a bill into law, and when the health care law was passed 253 were Democrats. The Senate requires 51 votes to pass a bill into law, and when the health care law was passed 57 were Democrats. Once again, I need someone to tell me how Republicans were being “obstructionists.” In reality, Harry Reid and Nancy Pelosi didn’t get to pass the law they wanted because conservative Democrats were pressured to oppose the bill. That’s why the far-left liberals today feel as though the law doesn’t go far enough. Republicans, who opposed the bill almost unanimously through the entire process, didn’t even have to show up for the final votes.

In the end, not a single Republican in the House or Senate voted to pass what is now referred to as ObamaCare. After the Senate passed the health care law, the San Francisco Chronicle stated, “The passage of Health Care Reform means the death of the Republican Party. Can you imagine any Republican effectively explaining to an electorate why they voted against help for the uninsured?” Help for the uninsured, at the expense of the remaining 90% of Americans? This issue is not as black and white as the Chronicle would have us believe.

Nine months later, a clear majority of Americans favor repeal and Democrats face the possibility of losing the House of Representatives. When you politicize a non-political issue like health care, emotions get in the way and eventually you have to start looking at the facts. Almost everyone agrees that our health care system is in need of reform, but if Congress is going to spend years and trillions of taxpayer dollars reforming it, shouldn’t we do it right? “It’s better than nothing,” is simply not good enough.

The simple truth is that President Obama and Democrats in Washington thought health care reform would be their golden moment, ensuring victories in 2010 and 2012. They completely underestimated the political cost of going against the majority of Americans, and I’m happy to see our nation waking up and paying attention to important issues again.

Someday we may even see Americans paying attention to the details of those issues. I welcome it.