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Tag Archives: Government Spending


Trump and the GOP can protect the American taxpayer and win working class votes all at the same time

By George LandrithThe Economic Standard

The US House of Representatives is getting closer to voting on the Butch Lewis Act, which failed to pass last year. While a number of provisions in the current version of the legislation make it an unworthy solution, the truth is the problem it attempts to address is real and the legislation even with its flaws does create the opportunity to amend and improve it so that a serious financial crisis can be avoided. Conservatives should consider this an opportunity. 

Many multi-employer pension and defined pension plans are now on the brink of failure. They carry over $600 billion of unfunded liabilities and are dangerously close to failing. Millions of retired Americans in states like Pennsylvania, Wisconsin, Michigan, Minnesota, Ohio, Nevada, Florida, Colorado, Maine and New Hampshire could lose their retirement. If that happens, they will be thrust onto the welfare rolls and the fruits of their life’s work will be lost. 

Even those who don’t have such pensions, are at risk. The 2008 housing bubble that triggered a huge economic slowdown, impacted everyone — not merely those whose mortgage was foreclosed upon. And we spent the next five plus years in economic turmoil and that was used as an excuse to grow the government. So we paid twice — first with the economic downturn and lost jobs and second, when government spending and debt grew dramatically and government’s penchant to over regulate drastically expanded. 

President Trump could ensure his reelection in 2020 and conservatives in the House could insure a return to the majority as well — if they can fashion a sustainable, conservative fix to the pending multiemployer pension plan crisis.

In 2016, Trump won a number of states narrowly — states like Pennsylvania, Wisconsin, and Michigan. In those states and many others — Ohio, Colorado, Nevada, Minnesota, Maine, New Hampshire and Florida — there are millions of citizens who are participants in multi-employer pension plans. Each of these potential voters has family and friends which only multiplies their electoral influence. By stepping in and averting this potential economic pitfall, Trump would win millions of blue collar voters in key states. Likewise, GOP congressmen who had a difficult year in 2018, could find themselves swimming with the current and regain the majority if they can take the opportunity to use the Butch Lewis Act as a starting point to address the multiemployer pension plan crisis in a conservative and sustainable way. Even Senate Republicans could see their majority grow if they move helpful legislation. 

In Pennsylvania, there are more than 493,000 participants in multi-employer pension plans. In Michigan, there are more than 440,000 multi-employer pension participants.  In Wisconsin, there are almost 150,000. Ohio has almost half a million. Florida has more than 340,000. Colorado has almost 200,000.  In Maine, more than 50,000. In Nevada almost 135,000.  In Minnesota, more than 278,000. 

In each case, those numbers could either expand upon Trump’s 2016 victory, or flip a state that he narrowly lost in 2016, to make it part of his expanded victory in 2020. And once you account for family friends and relatives, those numbers only increase the potential for an impressive reelection victory.

For GOP members of Congress, this provides a powerful way to win the support of working class voters and pave the way to reclaiming the majority in the House and help the Senate preserve and grow its majority. 

It may be tempting to leave this problem to fester and then let some future President and Congress deal with it when this pending crisis becomes a full blown, current crisis. But that’s dangerous and risky. The far Left has repeatedly signaled that they won’t let a “crisis go to waste.” They will use any crisis as an excuse to grow government, bust the budget and further smother economic opportunity with burdensome regulations. So solving this now is actually the conservative thing to do. It protects taxpayers and it can keep government growth in check. 

A workable and permanent solution will include a number of important principles.  First, the affected pension plans must be reformed by requiring them to meet more rigorous and realistic actuarial standards. Second, the reform must engage all the stakeholders to share in the costs, including at least temporarily, the retirees — rather than passing off the costs to taxpayers. Third, modest loan guarantees must be authorized to help pension plans that make the required reforms. This will allow them to get through their short term cash crunch and get back on a firm actuarial footing when the loans would be fully repaid. Fourth, the Pension Benefit Guarantee Corporation (PBGC) must be reformed to make it function as a real insurer where risks and cost balance out. If nothing is done, the PBGC will be bankrupt within 6 years — leaving taxpayers to make good on its promises which will cost hundreds of billions.

If President Trump and GOP conservatives become the champion of a wise pension plan solution like this, they can easily win re-election in 2020, regain the House majority, and expand their Senate majority. That is why the Butch Lewis Act with all its problems, presents conservatives with a real opportunity to fashion a solid conservative solution that benefits all Americans. 


Socialized Childcare: Elizabeth Warren’s Plan Means Soaring Taxes, Federal Control Over Your Kids

By EditorialInvestor's Business Daily

Socialist Goodies: Senator and presidential candidate Elizabeth Warren has yet another bright idea to fuel her White House ambitions: A sweeping plan to provide free, high-quality childcare for everyone earning less than $50,000, and subsidized childcare for the rest of us. No one would ever spend more than 7% of income for childcare. What could possibly be wrong with such a wonderful idea?

Plenty, as it turns out. It’s another in a long line of nanny-state programs put forward by the left that sound sweet at first, then sour when you realize what they really mean.

That’s definitely the case for Warren’s plan. First off, let’s begin with a fact: There is no such thing as “free.” Someone always pays. The question is “who?” and “how much?”

To pay for this “free” service, Warren would impose an “ultra-millionaire tax” on those with a net worth of more than $50 million to pay for the estimated cost of $700 billion over a decade.

But the estimate of “just” $700 billion for her program’s cost is highly deceptive. Because Warren’s cost estimates include the supposed economic benefits of childcare for families, but not the cost of less investment by those who are taxed. Costs would likely soar way above the initial estimate, leading to higher taxes for all. Not “free” at all.

‘Dishonest Accounting’

As Philip Klein of the Washington Examiner observes, “(Warren’s) proposal to extend affordable childcare to everybody relies on dishonest accounting to create the impresion that it is more fiscally sound” than it really is.

Par for the course for socialist policies, of course. It boils down to this: Promise everything, but deliver as little as possible. Watch the costs, always underestimated, grow out of control. Then blame the political opposition — or capitalism, or the “free market” — for your program’s failure.

It happens over and over again, and we all fall for it. As the shampoo commercials say, “lather, rinse and repeat.”

It happened in Britain. There, childcare subsidies for government-run centers pushed costs below the market rate. So private businesses that provided childcare couldn’t compete.

The same, no doubt, will happen here.

“In short, instead of reducing the costs of providing care through much-needed supply-side reform, this new demand-side scheme will further drive up the market price of childcare, with taxpayers on the hook now for increased use of formal care,” wrote Cato Institute’s Ryan Bourne, who holds the R. Evan Scharf Chair for the Public Understanding of Economics at the Cato Institute.

Government Takeover Of Childcare

What emerges from all this looks a lot like a government takeover of childcare, similar to what happened with healthcare and education. The cost soars, but the quality declines. And, in this case, the private companies that continued in business would become little more than appendages of a new federal childcare bureaucracy, with all the idiotic and costly rules that entails.

Parents would deliver their precious children to be guided by, as Warren’s plan would have it, “curriculum standards” and “standards similar to those that now apply to Head Start.” In other words, the federal government would be teaching your kids and instilling their values and morals. Parents lose control as the state raises their children.

Sound good to you?

As the Heritage Foundation recently noted, “The Department of Health and Human Services released the scientifically rigorous Head Start Impact Study in 2012, which tracked 5,000 3- and 4-year-old children through the end of third grade. The results? Head Start had little to no impact on the parenting practices or the cognitive, social-emotional, and health outcomes of participants. Notably, on a few measures, access to Head Start had harmful effects on participating children.”

High Costs, Dubious Benefits

Other studies of pre-school and childcare programs are equally inconclusive as to benefits. Yet the costs are enormous.

Moreover, in surveys, most parents would prefer caring for their children at home — not putting them into the hands of strangers. But Warren’s plan is specifically intended to institutionalize children in federally run institutions nearly from the time they’re born until the time they leave school.

The point is, “free” isn’t really free, and you get what you pay for. Leftists like Warren love to promise free things paid for by others, but then walk away when the quality turns out to be poor or just plain awful. This is the essence of socialist thinking, and also the way it gets voters to keep falling for socialists’ impossible promises of heaven on earth.

Role Models: Amtrak, Postal Service

If you want care for your children, the last place you should look for help is the federal government. Think of letting Amtrak or the Postal Service care for your kids, and you get the idea.

Even if you still believe federal government should involve itself in your private arrangements, a better plan would be to give vouchers to families based on need.

“Universal” preschool or childcare will not solve any problems, but it likely will cause many others, while further tearing apart American families and institutionalizing their children from an early age. A bad outcome for families, and a worse outcome for America.


Special Counsel Investigation Has Cost Taxpayers $25.2 Million

By Elizabeth Harrington • Washington Free Beacon

The special counsel investigation into the 2016 election has cost taxpayers over $25 million and counting.

Robert Mueller’s office released its latest expenditures spanning from April 1, 2018, through Sept. 30, 2018, finding the special counsel racked up over $8.4 million in five months.

The statement of expenditures reveals Mueller and his team of lawyers cost over $4.5 million for salaries and rent, and an additional $3.9 million in resources from the Department of Justice.

Personnel compensation and benefits cost taxpayers $2,886,270, including $1 million for special counsel office employees, and $1.9 million for Department of Justice employees who have been detailed to the investigation. Continue reading


Secure the Homeland and Ignore the Jones Act Blame Game

By George LandrithTownhall

While Puerto Rico is still recovering from last year’s severe hurricane damage, the all too predictable push to blame the tragedy on the Jones Act appears to have passed — for now. But almost like clockwork, this false blame game will be replayed whenever opponents of the Jones Act think they can spread falsehood during times of tragedy to gain a political advantage. When that next moment comes, the tired, oft-repeated, and baseless arguments will be trotted out once again.

The Jones Act, or more precisely, the “Merchant Marine Act of 1920,” simply requires goods shipped between U.S. ports to be shipped on American vessels crewed by Americans. It does not limit foreign vessels from bringing goods to US ports. It only prevents foreign ships from carrying cargo between two or more US ports. This has a number of homeland security benefits as well as ensuring that our military has a robust merchant marine sea lift capability and ship repair industry.

Some may assume that Americans are burned out on debating the Jones Act’s merits every time there’s a hurricane or some other event that supplies the pretext to blame the nearly 100 year old law. But when I recently spoke at a public policy conference, I saw Continue reading


3 Reasons Trump Should Have Vetoed The $1.3 Trillion Spending Monstrosity

Investor’s Business Daily

Some Republicans were complaining that they didn’t know what was in the massive $1.3 trillion “omnibus” spending bill they voted on this week. But it’s what’s not in the bill that’s the most troubling.

Republicans used to love to trot around copies of ObamaCare, pointing out how its massive size — around 2,300 pages — was a sign of runaway government.

The spending bill Congress just approved is nearly as big, weighing in at 2,232 pages. And, like ObamaCare, no one who voted on it had read the bill before casting their ballots.

Then there’s the amount of money we’re talking about. That $1.3 trillion is what will be spent in just the next six months. And that represents just a fraction of what the government will spend, since it doesn’t include Social Security, Medicare, Medicaid, ObamaCare or welfare. Continue reading


The Pension Crisis and School Choice

By Lewis M. Andrews • National Review

Talk to the people of Illinois about America’s looming public-pension crisis, and they’ll tell you it’s not looming — it’s already here. This month, a statute went into effect giving Comptroller Susana Mendoza the right to make up for any town or county’s delinquent pension payments by seizing its share of sales, excise, and other taxes collected by the state. The result is that municipalities across Illinois have been scrambling to either cut services or raise taxes.

Mattoon officials have announced that ambulance services will be scuttled to pay pension bills a half-million dollars higher than last year’s, while Springfield’s budget director, Bill McCarthy, says he will have to “reduce other services just to meet pension obligations.” Normal will handle the problem through property-tax increases, while Danville has imposed a separate “public safety pension fee,” which will cost residents up to $267 annually. East St. Louis, which depends almost exclusively on its share of tax money from state’s Local Government Distributive Fund, could soon see its entire budget confiscated to satisfy pension obligations.

With a national pension asset shortfall calculated as high as $6 trillion — and with accelerating benefit payouts to retiring Baby Boomers — Illinois is sadly not the only state where voters are being hit with revenue surcharges or deprived of essential services. Florida localities will have to allocate an additional $178.5 million in their upcoming budgets to pension payments; Continue reading


The Stakes of the Shutdown Standoff

Government shutdowns are petty, but they're rarely as detrimental as pundits and politicians fear.

By Peter RoffUS News

For various reasons it’s become popular to threaten to shut down the federal government. Whether that goes back to the Reagan years when Democrats would run out the clock on the fiscal year to try and force spending increases the White House didn’t want or the years in which the tea party Republicans decided the American people would stand with them in closing the government to stop Obama initiatives, there are people in government who believe hanging the “Closed” sign on the Washington Monument is a political winner.

It isn’t. It makes everyone involved look petty and small. The American political process is by design deliberative. The founders designed a system that forced compromise between regions of the country, between politicians of dissimilar views and of competing interests at all levels of government. Pushing the government to close because there’s no money to run it is akin to taking one’s ball home from the playground because the other kids will not agree to play the game by the rules you want.

All that said, the government never really shuts down. The president is allowed far too much discretion to declare services essential, meaning all kinds of people get to stay on the job without pay, working away as usual processing government checks, funding grants, administering programs and doing all kinds of things that, while they might be the purpose for which people get up and go to work each day, would hardly be classified as “essential” in any kind of real emergency. Continue reading


The White House Shoots for the Moon

By Peter RoffTownhall

Earlier this month, President Donald J. Trump signed a space policy directive to “restore American leadership in space.” To the excitement of many, this directive includes sending men back to the Moon and perhaps even Mars. The prospect of making dreams a reality once again is enthralling, something we will do, echoing a previous chief executive, not because it is easy but because it is hard.

To do all this, to optimize performance and ensure a successful, modern-day space program, government appropriators must adhere to a standard set of business protocols. It is essential NASA and the White House have clear goals in mind and ensure the interests of the country are at the heart of every mission. Stating the objective of going to the moon is not enough; bureaucrats need to take the process a step further and iron out precisely what it wants to achieve, how much it will cost to do so, and why the country will be better off as a result.

It is true few companies would turn down a government contract – after all, no one’s checks clear better than Washington’s – but that is not license for decision-makers to issue them carelessly. Every mission must have the clear intent of either advancing national security interests or significantly increasing the country’s scientific progress before the disbursement of taxpayer funds begin. The general rule of thumb should be that if extensive research from private firms has not been conducted on a given topic, it is likely not worth the federal government pursuing.

Continue reading


‘Evil’ Tax Cuts? Nope, It’s Blue-State Panic

By Heather Wilhelm • National Review

Ah, the holiday season. It’s a magical time, bursting with joy and merriment, the laughter of children, jolly parties, twinkling lights, mildly terrifying mall-dwelling Santas . . . and the faint sounds of caterwauling blue-state politicians shrieking that the GOP tax bill signals the end of civilization as we know it.

Can you hear it? Fire and brimstone! The weeping and gnashing of teeth! According to Nancy Pelosi, this reshuffling of government regulations amounts to “Armageddon” and “the worst bill in the history of the United States Congress.” California governor Jerry Brown labeled the tax bill “evil in the extreme.” According to Bernie Sanders, the proposal amounts to “class warfare” and “one of the greatest robberies in American history.” In terms of sheer melancholy drama, comedian Patton Oswalt might win the prize: Because of the GOP tax bill, “there’s no America now. Not the one we knew. Sorry, feeling real despair this morning.” Continue reading


President Trump’s Budget Would Reduce Deficit By $160 Billion and Increase GDP Growth

by Ali Meyer • Washington Free Beacon

President Donald Trump’s proposed budget for 2018 would reduce the deficit over the next decade by $160 billion and increase GDP at the same time, according to an analysis from the Congressional Budget Office.

Trump’s budget proposes a cut back in mandatory and discretionary spending that would not only reduce the deficit, but the debt as well.

Relative to the size of the economy, federal budget deficits are projected to decline by 2.6 percent to 3.3 percent of gross domestic product over the next 10 years. This would mean that the deficit would be roughly one-third smaller than it was originally projected to be.

Trump’s budget also aims to reduce the debt to 80 percent of GDP, which is 11 percentage points below the budget office’s baseline. By the end of the next decade, debt held by the public is projected to decline by 0.6 percent of GDP. Continue reading


Obamacare Subsidies Projected to More Than Double Over Next Decade

by Ali Meyer • Washington Free Beacon

Subsidies for health insurance purchased through the marketplaces established under the Affordable Care Act are projected to more than double over the next decade, according to a report from the Congressional Budget Office.

The report, which evaluated spending for various means-tested programs or programs that offer benefits to those who earn income under a certain threshold, found that spending on Obamacare subsidies will total $42 billion in 2017 and are estimated to more than double to $97 billion by 2027.

In fiscal year 2016, payments for subsidies totaled $31 billion and, according to the budget office, payments will grow rapidly in 2017 and 2018 largely due to the growth in enrollment. Continue reading


CBO: Federal Debt to Hit $28.2 Trillion Over Next Decade

by Ali Meyer • Washington Free Beacon

Outstanding federal debt is projected to hit $28.2 trillion over the next decade, according to a report from the Congressional Budget Office.

At the end of this year, outstanding federal debt is expected to climb to $19.4 trillion and to rise by $8.8 trillion in the next ten years.

The federal government’s budget deficit, which is the difference between how much money the government spends and how much money it takes in through tax collection, will be $590 billion by the end of 2016, $152 billion more than the previous year. Continue reading


Chinese firm bamboozles McAuliffe out of $1.4m in taxpayer money

The Virginia Governor put together a large economic development package—and bragged about bringing jobs—on the basis of fabricated promotional materials from a Chinese company.

by Steve Albertson     •     The Bull Elephant

Money Hole TaxJust over a year ago, in November 2014, Virginia Governor Terry McAuliffe beamed with pride at having concluded a deal to bring 349 jobs to the ailing economy around Appomattox. The plan was to use various state economic development incentives, including an upfront payment of $1.4 million from the Governor’s Opportunity Fund. From the Governor’s press release at the time:

Governor Terry McAuliffe announced today that Lindenburg Industry, LLC, a subsidiary of a Chinese-owned corporation, will invest $113 million to establish an industrial honeycomb manufacturing operation in the Town of Appomattox in Appomattox County. This project, which represents the first new company announcement in Appomattox in 15 years and the largest since Thomasville Furniture began construction in 1972, is a direct result of the Governor’s meeting with company officials in Beijing, China during his Asia Marketing Mission last month. Virginia successfully competed against North Carolina for the project, which will create 349 new jobs.

But, as it turns out, McAuliffe’s enthusiasm about prevailing over the Tar Heel State was misplaced. You see, the Chinese “company” has now apparently bailed out, without refunding the Governor’s check. It seems that folks in North Carolina were a wee bit more responsible with taxpayer funds. They did background research that the Governor’s office did not. In fact, an investigation by The Roanoke Times found that: Continue reading


America’s Economic Freedom Has Rapidly Declined Under Obama

America’s declining score in the index is closely related to rapidly rising government spending, subsidies, and bailouts.

by Anthony B. Kim     •     Daily Signal

obama_frownMillions of people around the world are emerging from poverty thanks to rising economic freedom. But by sharp contrast, America’s economic freedom has been on a declining path over the past decade.

According to the 2016 Index of Economic Freedom, an annual publication by The Heritage Foundation, America’s economic freedom has tumbled. With losses of economic freedom in eight of the past nine years, the U.S. has tied its worst score ever, wiping out a decade of progress.

The U.S. has fallen from the 6th freest economy in the world, when President Barack Obama took office, to 11th place in 2016. America’s declining score in the index is closely related to rapidly rising government spending, subsidies, and bailouts. Continue reading


A Road Paved With Good Intentions

by Kenneth BloomquistWeak Economy

Standing before an audience of college students, President Obama remarked that “As Americans, we can and should be proud of the progress that our country has made over these past six years. This progress has been hard, but it has been steady and it has been real. And it’s the result of the American people’s drive and their determination and their resilience, and it’s also the result of sound decisions made by my administration.” These remarks sound more defensive than confident. The President asserted that Americans should feel proud of the modest economic gains his administration frequently cites, but given that over half of Americans still consider the economy to be meandering through a recession it seems they have overwhelmingly rejected his outlook and chosen to remain humble instead.

Perhaps they’re being overly pessimistic? In the President’s defense, the metrics commonly used to measure the duration of recessions do indeed place the end of the Great Recession in 2009. Since then, GDP has risen slowly, but steadily, at an adjusted rate of just over 2% per year. The unemployment rate has fallen from its 2009 high of just under 10% to just under 6%, and new jobs are being created at a pace which is improving with time. And yet despite the graphs and charts, Americans refuse to be optimistic no matter how often they are told to be. The economy as described in press conferences doesn’t seem to be same one which most Americans live and work in, where family and friends remain unemployed or underpaid, where they have been passed over for raises, and where there just isn’t enough income leftover to save. Americans may not all have advanced economics degrees, but they are intuitively aware when times are good and when times are bad, and they remain skeptical even when bombarded by a steady stream of rose-tinted statistics.  Continue reading


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