After trying to tax Illinois to governmental solvency and economic dynamism, Pat Quinn, a Democrat who has been governor since 2009, now says “our rendezvous with reality has arrived.” Actually, Illinois is still reality-averse, so Americans may soon learn the importance of the freedom to fail in a system of competitive federalism.
Illinois was more heavily taxed than the five contiguous states (Indiana, Kentucky, Missouri, Iowa, Wisconsin) even before January 2011, when Quinn got a lame-duck legislature (its successor has fewer Democrats) to raise corporate taxes 30 percent (from 7.3 percent to 9.5 percent), giving Illinois one of the highest state corporate taxes and the fourth-highest combination of national and local corporate taxation in the industrialized world. Since 2009, Quinn has spent more than $500 million in corporate welfare to bribe companies not to flee the tax environment he has created.
Quinn raised personal income taxes 67 percent (from 3 percent to 5 percent), adding about $1,040 to the tax burden of a family of four earning $60,000. Illinois’ unemployment rate increased faster than any other state’s in 2011. Its pension system is the nation’s most underfunded, and the state has floated bond issues to finance pension contributions — borrowing money that someday must be repaid, to replace what should have been pension money that it spent on immediate gratifications.
Quinn’s recent flirtation with realism — a plan to raise the retirement age to 67 and cap pension cost-of-living adjustments — is less significant than the continuing unrealistic expectation that some of Illinois’ pension investments will grow 8.5 percent annually. Although the state Constitution mandates balancing the budget, this is almost meaningless while the state sells bonds to pay for operating expenses (in just 10 years the state’s bonded debt has increased from $9.4 billion to $30 billion), underfunds pensions and other liabilities, and makes vendors wait (they are owed $5.6 billion).
The Illinois Policy Institute, a limited-government think tank, in a report cheekily titled “Another $54 Billion!?” argues that in addition to the $83 billion in pension underfunding the state acknowledges, there is $54 billion in unfunded retiree health liabilities over the next 30 years. Illinois, a stronghold of public-employees unions, “is on pace to spend nearly $1 billion on retiree health care benefits in fiscal year 2013, more than double what it spent in 2003. Worse yet, these liabilities are growing more than twice as fast as tax revenues.”
To prepare for Illinois’ probable plunge into insolvency, read “Freedom to Fail: The Keystone of American Federalism” by Paul E. Peterson and Daniel Nadler in the University of Chicago Law Review. They note that only 25 of the world’s 193 nations have federal systems, and in most of the 25 the freedom of the lower tiers of government is more circumscribed by the central government than American state governments are by the federal government. American states’ greater freedom — autonomy under America’s system of dual sovereignty — from the central government’s supervision requires that they be disciplined instead by the market for government bonds, and by the real possibility of default.
Peterson, a professor of government at Harvard, and Nadler, a doctoral candidate also at Harvard, say that collective bargaining rights for government employees pose “a dramatically new challenge to the viability” of American federalism. They cite studies demonstrating that investors’ perceptions of risk of default are correlated with the rate of unionization among government employees. Higher percentages of government employees who are unionized, and larger Democratic shares of state legislative seats, correlate with increases in state borrowing costs.
At least 12 percent of Americans change their residences each year, often moving to more hospitable economic environments. In a system of competitive federalism, Peterson and Nadler write, “If states and localities attempt in a serious way to tax the rich and give to the poor, the rich will depart while the poor will be attracted.” And government revenues and expenditures vary inversely.
From September through December 2008, the premium that investors demanded before they would buy California debt rather than U.S. Treasurys jumped from 24 to 271 basis points (100 points equals 1 percent). The bond market, the only remaining reality check for state politicians, must be allowed to work.
Constitutional jurisprudence affirms that states exercising substantial autonomous powers thereby assume concomitant risks. Federal loans or other bailouts of misgoverned states would remove bond market discipline, the only inhibition on the alliance between the Democratic portion of the political class and unionized public employees.
This from the folks over at FreeMarketAmerica:
What would you do if you were trying to destroy America; its prosperity and confidence as a nation? Pretty much what we are seeing done, now and for the last couple of decades…
EPA Expands Its Mission To Crucifixion
Finally, someone within the regulatory machine states candidly what many of us have known all along: the EPA sees its mission as beating-up on American business!
By Charles C. W. Cooke
Free nations that respect the rule of law tend not to make examples of their citizens, much less crucify them. This rule of thumb, however, seems to have been lost on the EPA, an official from which had an interesting analogy to share in a video that has just surfaced:
“I was in a meeting once and I gave an analogy to my staff about my philosophy of enforcement, and I think it was probably a little crude and maybe not appropriate for the meeting, but I’ll go ahead and tell you what I said:
“It was kind of like how the Romans used to, you know, conquer villages in the Mediterranean. They’d go in to a little Turkish town somewhere, they’d find the first five guys they saw and they’d crucify them.
“Then, you know, that town was really easy to manage for the next few years. And so you make examples out of people who are in this case not compliant with the law. Find people who are not compliant with the law, and you hit them as hard as you can and you make examples out of them, and there is a deterrent effect there.”
Note that the speaker, Region VI administrator Al Armendariz, considered his words not to be inappropriate for a government agency to think or do but to say at a “meeting”.
(Go Here to continue reading article)
Is there anyone who still thinks that this Administration is pro-business? Or supports traditional, affordable energy sources?
Perhaps someone should alert the Administration and its EPA that the way to grow jobs and produce affordable energy solutions is to stop driving business out business; and to stop “crucifying” energy producers with increasingly unreasonable regulatory demands!
UPDATE: Over at the Temple, the Goddess weighs in with a terrific insight into this issue! Go here and wallow in her wisdom.
Remember when conservative news commentators condemned Catholic presidential candidate, John Kerry, for his pro-abortion stance; one that contradicts the teachings of his own faith, and is by the Church’s teachings a damnable sin?
Maybe because it didn’t happen.
Because there are some levels of discourse that should, even in politics, be off-limits.
Progressive Catholic politicians, such as Nancy Pelosi, the late Ted Kennedy, and Kerry take pro-abortion stances that are in direct conflict with their faith. No one on the Right uses this as a rhetorical club to beat them with; because matters of faith are deeply personal, between each of us and our Church and God.
Except when it comes to Mitt Romney, and the execrable MSNBC; the septic tank of News Media outlets.
In a segment called “Clear the Air,” Bashir took umbrage at Mitt often pointing out Obama’s promise that, if his near-trillion dollar stimulus bill was passed in 2009, that unemployment would remain below 8 percent.
Wagging his rhetorical finger from MSNBC’s pulpit, Bashir preached his warning to the candidate:
“‘Mitt the Mendacious’, knows full well that the president never, ever said such a thing. It is something that the president has never written nor said… it doesn’t matter how many times he hears the truth, Mitt Romney prefers to tell lies.”
Bashir went on to cite passages from the book of Mormon predicting hell for liars; including a verse that reads: “Wo unto the liar for he shall be thrust down to hell.”
“Given what the book of Mormon is clearly saying, Mr. Romney has but two choices: He can either keep lying and potentially win the White House but bring eternal damnation upon himself. Or, he can start telling the truth. The question for him, I guess, is which is more important?” Bashir said.
Ignoring the accuracy of Obama promising (or not) a lower-than-eight percent unemployment rate: Where do liberal/progressives get off bringing religion into the public forum, and using it as a club?? When it is the Left that rises to condemn the slightest perceived intrusion of Christianity into the public sphere; and would howl with deafening outrage if it were, say, Fox News promising hell fire and brimstone for obvious religious hypocrisies on the part of liberal politicians, such as Pelosi or Kerry.
Just when you thought MSNBC couldn’t sink lower….
Bashir and his friends at NBC should leave the preaching to those who get paid to do so; and stick to objective reporting. That is, if they can remember how to do so.
It takes guts to go to the moon, in a space ship smaller than Donald Trump’s master bathroom; relying on less computing power than is found in a standard pocket calculator!
But in today’s highly charged political climate, it takes more guts to challenge the global climate change orthodoxy.
That’s what 50 former astronauts and scientists have chosen to do, in calling upon NASA to stop its unhesitating acceptance of “unproven” theories of man-made global warming. In a letter addressed to NASA Administrator Charles Bolden and Goddard Institute for Space Studies (GISS) director James Hansen, the group requested that both NASA and GISS refrain from making “unproven remarks in public releases and websites” on the subject of Global warming.
For those who have only followed this argument peripherally, let me state that the argument is not over whether the planet’s climate is changing. The argument is over:
1. Are these changes man-made, as opposed to a natural-occuring phenomenon?
2. Is it something that can be “fixed” by drastically altering our lifestyle; spending trillions of dollars to do so?
3. Will the rising of global temperatures by a few degrees be more harmful or beneficial, on the balance?
NASA, takes (arguably) the most alarmist viewpoint: the orthodox Man-Made Global Warming Catastrophe position. That global disaster will ensue if we don’t do something drastic now to alter our current trajectory.
This is a controversial position, as are all on this highly politicized subject. What the group of astronauts and scientists take issue with is NASA and GISS’s full-throated support of one side of this issue; one not yet proven or accepted by many in the scientific community; and by so doing damaging the NASA brand-name.
“We feel that NASA’s advocacy of an extreme position, prior to a thorough study of the possible overwhelming impact of natural climate drivers is inappropriate,” they wrote. “At risk is damage to the exemplary reputation of NASA, NASA’s current or former scientists and employees, and even the reputation of science itself.”
The letter was signed by seven Apollo astronauts, a deputy associate administrator, several scientists, and even the deputy director of the space shuttle program.
NASA had no immediate comment.
What is unfortunate is this Administation’s intrusion of politics into everything it touches; including space exploration.
Apollo Astronaut Buzz Aldrin, one of the signatories to the letter.
This ad, for the up coming 3 Stooges film, was rejected by CBS. Why? Because it “made fun of a serious subject”; in this case, prescription drug ads!
And Liberals say we Conservatives don’t have a sense of humor! Who’s being a Stooge now, CBS?
Here at Word Warrior, a P.C. Free Zone, WE aren’t afraid of a little Stooge Mania! Here is what CBS didn’t want you to see: