RGF in the Wall Street Journal
New Mexico Governor Bill Richardson is running for President and is doing so by campaigning as a “market-oriented Democrat” and a tax cutter. While these terms may be music to the ears of limited government types, the truth is that Richardson has expanded government in New Mexico at an unprecedented pace.
Recently, I discussed Richardson’s fiscal record on the pages of the Wall Street Journal. Let’s just say that while he is certainly to the right of most of his Democratic colleagues (and perhaps some, Republicans as well) he’s no fiscal conservative.
“Private Enterprise” in New Mexico?
Some good news was reported last week on the New Mexico economic front. According to the Albuquerque Journal, a company called Green Rubber Global is going to set up a headquarters in Albuquerque and open a state-of-the-art tire recycling business in state. No one can dispute the fact that this is good news for the state economy or that tire recycling fits in well with the overall “green” development model that is driving development in the state.
Of course, a few days later the Journal ran another piece (subscription required) outlining the $3.9 million incentive package the state is offering Green Rubber in order for them to build a $30 million plant. Of course, this project will be a boon to New Mexico’s economy in the end, but wouldn’t it be great if taxes were and regulations were made reasonable for every business owner in the state and not just those making a $30 million upfront investment in a politically-favored business model?
Mid-session Budget Review: Strong Revenue Growth Continues
The Office of Management and Budget has published its “Mid-Session Budget Review.” To sum the situation up:
- Federal tax revenues continue to be very strong, having risen by 7 percent. This comes on the heels of increases of 15 percent and 12 percent the past two years (clearly tax cuts are helping the economy);
- At 1.5 percent of GDP, the budget deficit is now lower than it was in 24 of the past 30 years;
- Total 2007 federal spending is estimated to be 20.2 percent of GDP, up from 18.5 percent when President Bush took office. Had spending remained at 18.5 percent of GDP, this year’s budget would show a $35 billion surplus.
Basically, what the OMB is telling us is that spending is rising fast, but the economy (and tax revenues) continue to outpace even Congress’s ability to spend. If Congress and the President could agree to limit federal spending to inflation and population growth, the deficit would be gone and economic growth would continue long into the future.
Of course, it wouldn’t hurt New Mexico to enact similar limits.
John Stossel Destroys Michael Moore’s Premise
The entire debate over socialism vs. free markets comes down to two simple facts: 1) the left doesn’t understand economics and 2) the left confuses compassion with government action. Michael Moore has made these mistakes in spades throughout his career, nowhere more often than in “Sicko.” Unlike most of the mainstream media, John Stossel calls him on the lies and obfuscations that Moore perpetrates.
Hating Michael Moore is not going to win any arguments; instead, those who philosophically disagree with his socialist worldview need to come up with alternatives of their own that are superior to the snake oil Moore is selling. Kudos to John Stossel!
Everitt’s Legacy Overshadowed by No Child Left Behind
As a product of Albuquerque Public Schools, I feel strongly attached to its fortunes and misfortunes. As of Monday, superintendent Elizabeth Everitt announced her refusal to renew her contract next year. She leaves her office as a controversial figure.
Whatever achievements Everitt did or did not accomplish, her tenure is tainted by the effects of the 2001 No Child Left Behind Act. We can criticize her all we want, but she could accomplish little in the face of such overwhelming and stifling regulation. The system created by this act “impedes learning, encourages dropouts, narrows the curriculum, increases anxiety, fosters academic dishonesty, and does nothing to improve schools,” and Everitt could do nothing to change this.
We all know that APS has plenty of problems. Yet we must also realize that we can never address those problems until we can define our own educational system, free from No Child Left Behind and other strangling federal regulations.
FDR and the modern state
Franklin Roosevelt is considered by the “mainstream” and many academics to be among the best presidents in our history. I have always felt otherwise and believe that he is actually among the 10 worst.
I was pleasantly surprised, then, that George Will will offered such a strong condemnation of the Roosevelt record on the pages of the liberal establishment Washington Post.
Among Roosevelt’s many sins was, “Furiously using legislation and regulations to multiply federally favored groups, and by rhetorically pitting those favored by government against the unfavored, he could create a permanent majority coalition.” This certainly sounds like the model used by the modern Democratic Party.
Roosevelt summed up his big-government philosophy in his second inaugural address by saying that he wanted “To enforce the ‘proper subordination’ of private power to public power.” That is nothing more or less than removing power from the individual and giving it to the government. It is the ultimate goal of the Rio Grande Foundation to reverse that troubling trend here in New Mexico.
Sicko: Heavily Doctored
While it generated a good deal of buzz on the left and in the media, relative to Farenheit 911, Michael Moore’s “Sicko” seems to have been a dud. There may be any number of reasons for this relative lack of success, but I think the overtly-socialist message has a much narrower audience than a foreign policy flick that tears apart what we all know was a deeply-flawed foreign policy being propagated by the Bush Administration.
Of course, when Kurt Loder of MTV fame unloads a scathing review, it is a given that the rest of the mainstream, left-leaning media is not lined up in lock-step with your cause.
Congressional Democrats’ Latest Tax Hike Proposal
Congressional Democrats are hoping to pass a tax hike on cigarettes in order to pay for still bigger government. While billions in tax hikes were removed from the Energy Bill by Senate Republicans, the latest tax hike to increase funding by $50 billion for the State Children’s Health Insurance Program , also called SCHIP.
Of course, SCHIP expansion is just another means of expanding government health care at the expense of private health care. Not surprisingly, Governor Richardson has made SCHIP expansion a point of emphasis. The not-so-subtle point here is that the Democrats are using SCHIP expansion as a means of incremental steps to “universal, socialized medicine.”
Perhaps President Bush will veto this massive tax hike and expansion of government as he has pledged in the past?
Big Government Conservatives and Government Education
A few weeks ago I blogged about a David Brooks column in which he claimed that the “free market” is failing to produce enough educated workers for the American economy.
It was good to see John Stossel express many of the same thoughts I did in a recent column. We have enough problems with the teachers’ unions and those who have a direct interest in misleading Americans about the socialist nature of government-run schools, we don’t need so-called “conservatives” doing it as well.
Santa Fe Silliness
Few cities are so willing to adopt senseless and economically-harmful policies as Santa Fe. Whether the issue is the dreaded toilet exchange program or the incredibly inflated $9.50 an hour minimum wage, Santa Fe is on the loony left.
Now, some city councilors would like to push the city even further down the road to economic foolishness. The latest proposals are for a two cent tax on soda pop and a 1 percent hike in the city’s gross receipts tax. The plan is to use the money for a variety of open space and child development initiatives.
While the soda tax may not be as big or economically-harmful as a 1% increase in the gross receipts, it is patently unfair and unnecessarily targets one group of people – soda drinkers – to pay for something that most of them will never benefit from. Besides, as soon as a soda tax is levied, can taxes on burgers, pizza, and ice cream be far behind?
Of course, raising the gross receipts tax — especially by a full penny — will do more economic harm than the soda tax. Santa Fe already has the heaviest gross receipts tax burden of any major (25,000 people or bigger) city in New Mexico, a one-cent increase would give the city an astounding 8.625 percent gross receipts tax rate. The new rate would be an astounding 25 percent greater than the rate charged in Albuquerque. Check this table for gross receipts tax rates statewide.
While it may not happen overnight, eventually Santa Fe’s economy and even its tourist industry will begin to suffer from these absurd policies. After all, most wealthy people didn’t get that way by carelessly wasting money. Eventually, even Santa Fe’s tax burden may cause tourists and part-year residents to look elsewhere.
