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Archive for February, 2013

Please read the following guest post from Larry Koch, special contributor on for the Center of Education Excellence at the Caesar Rodney Institute.

One of the reasons I retired from educational administration from a rural Maine school district was a cynical method to increase taxes that a number of my colleagues engaged in. This is how it worked:

1)        The town, usually fed up by double digit increases, would demand that the district lowered expenses by let’s say 2%. This should not have been a difficult task to do in a multi-million dollar budget.

2)        After a number of hearings (to show that they tried) the Superintendent would come out with a proposal that would cut sports, after school programming, AP classes and special education.

3)        The constituency groups for all of these programs would show up, howling for their children, at every board and town meeting, until-far too often- the proposed cut was dropped, and often a tax increase was agreed to.

The reason this scenario was so cynical was that it had been choreographed in advance, and concerned parents were manipulated into doing something that was destructive to the community, and ended up with farms being closed and people defaulting on their taxes. Education was not advanced, and the bureaucracy was engorged. School officials could have surgically applied cuts so essential and popular programs were saved, but they chose not to do so! Yes, they would have been criticized by somebody, but that is why they got those inflated salaries; to show some leadership!

Instead they turned the most active consumers of public education, the parents, in effect against the most economically vulnerable people in the community, seniors and struggling family farmers, in a conflict that leaves the community weaker and in no way improves learning. 

That is basically the scenario for the sequester debate. Our 16 trillion dollar government with some imagination should be able to absorb a cut of 2%. Instead, the administration plans on across the board cuts, highlighting the effects it will have on schools, the disabled, transportation, etc.,. The government, if it showed some leadership, could identify areas where little damage would result from reducing expenses, but refuses to do so, unless taxes are raised. This is a cynical- after the fact – grab for more money; the sequester legislation never mentioned a tax increase, but Obama would never allow an opportunity for this to pass without notice. Sequester would allow the president and departments to fine tune their cuts, as long as it came up to the required amount, but they have chosen not to do that without a tax increase.

Just like that school district, Washington’s continuing, insatiable demands for endless growth is demanding to be fed, and a cynical method has been employed to achieve that end. This was bad enough when it was done locally by petty school administrators- but now Washington has taken a leaf from their book! How pathetic!

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This is a guest post from Sam Patterson over at economicfreedom.org. There is a big difference between being pro-business and being pro-market. Many people say they support businesses, especially small businesses. Unfortunately, many businessowners and employees are not “free-market”-that is, they believe it is OK and even justifiable to use the government for subsidies, lobbying, and to eliminate competition. For example, at a New Castle County Chamber of Commerce event a small business owner who sells solar panels justified his government handout by saying he “needed it to be competitive” with other types of industries. Or consider a large corporation using their power to pay off politicians and bureaucrats by lobbying them to help eliminate the competition (such as with expensive occupational licenses) or to allow them to skate by with violating rules (examples include Fanny and Freddy, Citigroup, AIG, Solyndra), often at our expense. Unions too often interfere with the process, when they demand the forbidding of workers from being employed unless they join a union, and in some cases they too move to restrict competition, such as if a businessowner wants to open a non-union business (closed-shop rules), instead requiring the owners to hire only unionized workers.

Without further ado…

Consider the following . . .

Because businesses provide jobs and make other positive contributions to communities, both “sides” agree that government should promote business. Where they differ is over how. Pro-business advocates believe the government should directly assist specific businesses or industries through subsidies, tax breaks, or other advantages. Pro-market supporters reject this.  They argue that government should simply ensure a level playing field for competition.

The truth is that intervention in the marketplace harms everyone—except those directly receiving the benefits, of course. When the consumer is no longer the deciding factor in whether a business succeeds or fails, businesses direct more and more of their resources toward securing government favors and less and less on pleasing customers. Corruption and cronyism often result. And it’s always the taxpayers who end up having to pay for it all.

 

You know you’re “pro-business” rather than “pro-market” if you believe . . .

  • government should make special tax provisions for specific industries
    (pro-market position: equal tax rates for all)
  • government should give out grants to individual businesses
    (pro-market position: government shows no preference to individual businesses)
  • government should use eminent domain to make way for private development
    (pro-market position: eminent domain should never be used for private interests)
  • government should make loans to businesses that can’t secure them in the private sector
    (pro-market position: government should not be making loans to businesses at all)
  • government should impose tariffs to protect domestic industries from global competition
    (pro-market position: tariffs increase prices for consumers)

When the government supports certain companies or industries over others, the special interests unfairly benefit. Economic freedom is what can bring prosperity and opportunity to all. That’s why we must make sure we are not just “supporting business” but always upholding the virtues of the market.

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This is from the Institute for Energy Research. The purpose of the testimony is to raise awareness for a potential economic turnaround if America’s natural resources were allowed to be fully developed. Of course, not much will change if healthcare costs and taxes continue to rise, but if costs go down and energy is made more available, we would be in a better position today.

IER SENIOR FELLOW TO TESTIFY ON AMERICA’S ENERGY RESOURCE POTENTIAL

IER’s Mary Hutzler Targets Senseless Federal Energy Policies

IER Distinguished Senior Fellow and former acting EIA administrator Mary Hutzler will testify on Tuesday, February 5, 2013 at 10:00AM before the House Subcommittee on Energy and Power. The hearing will focus on “American Energy Security and Innovation: An Assessment of North America’s Energy Resources”. Hutzler’s testimony will evaluate North America’s vast energy resources and assail the federal energy policies that continue to deny access to those resources and stifle economic growth and job creation. Highlights from the testimony include:

“The United States has more combined oil, coal, and natural gas resources than any other country on the planet. As we used these energy resources over the past 50 years, not only did we grow our economy and improve our quality of life, but we improved our air quality as well.”

“We are energy rich, not poor . . . The real question is whether the federal government will permit us to have access to our abundant energy resources, not whether sufficient resources exist.”

“Increased energy production promotes jobs, government revenues from taxes and lease sales, and increased economic activity.”

“The reason for the boom in both oil and natural gas production in the United States today is that our oil and gas industry was able to revolutionize drilling and production from shale formations by combining hydraulic fracturing and horizontal drilling technology . . . When combined with the incredible advances in computer interpretative capabilities, an energy miracle is afoot.”

“Lower energy prices benefit the entire economy, but especially the economically disadvantaged and those on fixed incomes. Expanded energy production resulting in lower prices is thus a benefit to society. The increase in hydraulic fracturing, however, has led to attacks on natural gas production. Many special interest groups have launched anti-hydraulic fracturing campaigns, claiming that is a new, dangerous technology that contaminates groundwater. But the reality is far different.”

“The Keystone XL pipeline would not only move Canadian oil but it would also help to move oil from areas in the United States where it is land-locked, such as shale oil production in North Dakota and crude oil stored at Cushing, Oklahoma . . . . The U.S. government has delayed, denied and delayed again its approval.”

“Developing oil and natural gas production on federal lands is becoming more difficult and time consuming. As a result, oil production is decreasing in the federally-controlled offshore areas and Alaska, but increasing on state and privately-controlled onshore areas.”

“If more oil is not allowed to be produced soon from Alaska, the Trans Alaskan Pipeline System, one of North America’s most valuable energy assets, will be at risk. The pipeline, which once delivered 2.1 million barrels of oil per day to the West Coast, now has sufficient underutilized capacity to accommodate twice the amount of oil that is currently being produced in North Dakota, the second largest oil producing state in the Union.  There is no lack of oil in Alaska or off its coasts; the problem is that government policies stand in the way of additional oil production in Alaska.”

“As technology continues to advance, coal-fired power plants will become even cleaner and air quality will continue to improve . . . An irony of our current regulatory policy may be that China will ultimately become the world’s supplier of the most advanced clean coal plants, despite the U.S. coal resource base which dwarfs their own.”

to see the presentation, visit http://www.instituteforenergyresearch.org/

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