The Flight Out Of High Tax States Continues - A New Jersey Case Study

 On a periodic basis we do some posts that fall under the theme of “by the numbers.” Rather than trust what the American political class tells us about reality, we like to examine the real numbers and the real reality in the world to understand what is actually going on. Relying on politicians, and their cohorts in the media, to tell us what is reality is always a sucker bet. They have their own agendas and goals, usually centering around their needs and self-enrichment. So we need to look at the reality of the numbers to determine what is really going on.

Previous analyses of “by the numbers” can be accessed by entering the phrase in the search box above. This is the third and final post this month where we look at the numbers to truly find out how good, not likely, or bad, most likely, the American political class is doing in managing our tax dollars, protecting our freedoms, and resolving major issues that affect all of us.

Today we will do a quick look at the numbers as they relate to my former home state, New Jersey. In a previous post, we analyzed the states and cities that are most likely to go bankrupt first. Our conclusion was that New Jersey,  along with New York, California, and Illinois, will be the first states to go bankrupt. Our previous analysis can be found at:

https://loathemygovernment.blogspot.com/2020/11/which-city-and-which-state-will-go.html

Our theory is that badly run states, like the four listed above, continue to over tax, over regulate, and rob their residents and businesses of their individual freedoms. Those oppressed residents and businesses eventually migrate to other, less oppressive locations for a better quality of life for themselves and their businesses. As residents and businesses leave, the states’ tax bases get smaller and smaller which results in higher taxation on the remaining residents and businesses. These higher taxes drive more residents and businesses out of the state further reducing the tax base. And the financial death spiral is now in play.

And while we forecasted that Illinois or California would go bankrupt first, given their dire financial situation and the mass out migration of their residents and businesses, a recent analysis of New Jersey says that maybe, just maybe New Jersey may beat both states into bankruptcy:

• According to the travel  website moveBuddha, New Jersey now has the highest proportion of residents moving out of the state vs. every other state.

• The numbers are quite amazing: for every 34 moves into New Jersey, there are 100 moves out of the state.

• Thus, there is almost a 3 to 1 ratio of out moves vs.  in moves.

• One out of every four out moves from New Jersey is to Florida.

• I know from personal experience, given my move from New Jersey to Florida, that our property tax rate in Florida has been a fraction of what the property tax rate in New Jersey was.

• Also, my state income tax bill in Florida is 0% because there is no state income tax rate.

• I estimate that since I left New Jersey 17 years ago, I have easily saved over $150,000 in property taxes and state income taxes without any loss of quality of life.

• The 3 of the top 5 cities fleeing New Jersey residents are heading to include Naples, Miami, and Tampa Florida.

• New Jersey ranks 4th in the country for the total number of out moves.

• 42% of New Jersey respondents that responded to the moveBuddha migration poll said they were planning to move to another state in the next year.

• In a different study, United Van Lines found in their poll that New Jersey was ranked #1 for the  most out of state moves over the past four years.

Apparently, the state politicians in New Jersey have not learned their lesson. The out migration continues,leaving New Jersey with fewer and fewer residents, resulting in a smaller and smaller tax base. A smaller tax base results in a tax revenue shortfall and causes the state politicians to raise taxes which forces more people to leave and the spiral is in place.  The numbers don't lie even if politicians do.

Our book, "Love My Country, Loathe My Government - Fifty First Steps To Restoring Our Freedom And Destroying The American Political Class" is now available at:

https://www.amazon.com/Love-My-Country-Loathe-Government/dp/1604942789/ref=sr_1_1?dchild=1&keywords=love+my+country%2C+loathe+my+government&qid=1607716020&sr=8-1

Please visit the following sites for freedom:

http://www.reason.com

http://www.cato.org

http://www.openthebooks.com

http://www.conventionofstates.com

http://www.youtube.com/watch?v=08j0sYUOb5w

 

December, 2016, Part 1, By The Numbers: Leaving Democratic States and Moving To Republican States

Before I start today’s post, let me reiterate my voting history like I have done many times in the past:

• I have been a legally voting since the 1970s.
• Since then, I have never voted for a Republican for President.
• I have rarely voted for a Republican for national office over that time period.
• I have never been a registered Republican voter.

Keep that in mind as you go through the following discussion. 

On a periodic basis we do some posts that fall under the theme of “by the numbers.” Rather than trust what the American political tells us about reality, we like to examine the real numbers and the real reality in the world to understand what is actually going on. Relying on politicians, and their cohorts in the media, to tell us what is reality is always a sucker bet. They have their own agendas and goals, usually centering around their needs and self-enrichment. So we need to look at the reality of the numbers to determine what is really going on.

Previous analyses of “by the numbers” can be accessed by entering the phrase in the search box above. This is the third and final post this month where we look at the numbers to truly find out how good, not likely, or bad, most likely, the American political class is doing in managing our tax dollars, protecting our freedoms, and resolving major issues that affect all of us. 

Benny Johnson, Jason Howerton, and Parker Lee, writing for the Independent Journal Review recently summarized what the economic conditions currently are in the states that heavily voted in favor of Democratic Presidential candidate Hillary Clinton in last month’s Presidential election. Besides having the common characteristic of favoring Hillary over Trump, they also have the common characteristic of having some pretty lousy economic and out migration trends going on in their states. This conclusion is based on citing a Washington Times article by Stephen Moore.

Moore concludes from his analysis that the out migration from these Hillary strongholds is driven primarily by economic reasons including: “high tax rates; high welfare benefits; heavy regulation; environmental extremism; high minimum wages.” Amazingly, the ten states that Hillary Clinton won by the largest percentage margins saw a net loss in population from 2004 through 2014. California and New York by themselves saw a net loss of 2.75 million Americans over that ten year time frame.

As you go through the ten states economic profiles below, keep in mind that these states are almost always dominated by Democrats in elected office. Yes, occasionally, a Republican or two might get elected in these states, but for the most part these are strictly Democratic controlled and operated states. I am not saying there is a cause and effect of Democrats creating lousy economic conditions but the correlation, as you will see below is certainly quite strong.

1) Massachusetts - Between 2004 and 2014, Massachusetts lost 156,861 more residents than it gained. One reason for such a loss is that Massachusetts has a top business income tax of 8%, one of the highest overall property tax burdens in the country, and also has estate and inheritance taxes.

2 ) California - California has lost an amazing 1.3 net residents over the past decade despite having some of the richest people in the nation living in the state in Hollywood and Silicon Valley. Thus, something must not be right for the over 1 million people who decided to leave the state for a better life

3) Maryland - Maryland has lost a net 145,000 residents over the past decade, possibly caused by the reality that the state ranks 44th in economic outlook according to the in-depth analysis done by the American Legislative Exchange Council (ALEC), has a top personal income tax rate of 8.95%, and has the 13th highest business income tax rate. Over the past 47 years the state has had only two Republican governors.

4) New York - The ALEC ranks New York as dead last in its economic outlook ratings, a spot it has been “honored” with in six of the past seven years. It has some of the highest tax rates in the country and its net loss of population over the past ten years, 1.5 million people, is the largest loss of any other state in the union.

5) Rhode Island - The ALEC rates this state as 48th in economic performance and 35th in economic outlook. Rhode Island has a very high property tax rate and has had a net loss of 70,000 residents over the past decade, a lot considering how small the state’s population is to begin with.

6) New Jersey - My former home state has some of the highest tax rates, personal income tax, property tax, and business tax rates, in the country. The ALEC ranks the state as 48th relative to economic outlook and has had a net loss of about half a million residents since 2005.

7) Connecticut - HIgher than average tax rates and ranking 47th on ALEC’s economic outlook measure makes it no surprise this state has lost 153,000 residents in total over the past decade.

8) Vermont - The ALEC has Vermont ranked 49th in economic outlook, the state has the second highest personal income tax structure and has enacted many new tax changes that will make it more expensive to live in the state. No surprise, it has had a net loss of 9,000 residents over the past ten years.

9) Illinois - Possibly one of the biggest basket cases of all the states, given its incredibly high unfunded pension and retiree benefit liabilities for government workers, the state does have a reasonable income tax rate but higher than average business tax rates and high property taxes. As a result, it has had a net loss of 700,000 residents over the past ten years.

10) Hawaii - The ALEC found that Hawaii has the highest marginal personal income tax rates in the country and the highest sales tax rates in the country. Despite its beautiful weather, the state had a net loss of 36,000 residents since 2005.

Conversely, five states that the ALEC rank in the top 15 relative to having really good economic futures, Wyoming, Oklahoma, North Dakota, Tennessee, South Dakota and Idaho, have not only seen net gains in state populations over the past ten years but also had the highest percentage of voters that voted for Donald Trump. In fact, if you look at the ALEC table below which rank orders all 50 states relative to their economic outlook rankings, the top twenty states with the brightest futures are usually dominated by more conservative, Republican politicians.

Thus, is it any surprise that people are moving to states with lower taxes and brighter economic futures? Is it any surprise that states that are losing population are states with higher taxes and less bright economic futures? People who work hard for their money and their families realize that the best way to be happy is to keep as much as they earn and will make life decisions accordingly. 

And that more than any other reason is why an old, tired, same old Democratic politician, Hillary Clinton, lost an election to a non-politician with no Washington or international experience who was plagued by personal behavior problems and who was outspent by about a two to one margin. Freedom, the desire to keep what was earned, and to not be taxed to death is why people behave the way they do, whether it is choosing a place to live or who to vote for. The numbers do not lie.

More numbers tomorrow.

Our book, "Love My Country, Loathe My Government - Fifty First Steps To Restoring Our Freedom And Destroying The American Political Class" is now available at:

www.loathemygovernment.com

It is also available online at Amazon and Barnes and Noble. Please pass our message of freedom onward. Let your friends and family know about our websites and blogs, ask your library to carry the book, and respect freedom for both yourselves and others everyday.

Please visit the following sites for freedom:


http://www.reason.com
http://www.cato.org
http://www.bankruptingamerica.org
http://www.conventionofstates.com
http://www.youtube.com/watch?v=08j0sYUOb5w

Why Overtaxing The Rich (In New Jersey) Is Often A Stupid Idea - Third In A Continuing Series

This is a third in a continuing series of posts where we discuss why it is often a stupid idea to unfairly overtax the rich. Standard disclaimers: first, my family is no where close to being considered  "rich." We pay our Federal income taxes at the 15% tax bracket level. We live in a typical middle class, 2,000 square foot suburban home. I drive a seven year old vehicle and my wife drives a five year old vehicle. Thus, we do not have a direct stake in how much the rich are taxed.

Second disclaimer: the words "overtaxing" and "rich" are very subjective terms and concepts. Thus, the purpose of these posts is not to convince anyone what rich or unfair or overtaxing should be but to illustrate what can happen when taxes are increased on those high earners in our society. Wanting to tax the rich more is everyone's right but the reality of what happens when taxes are raised is what everyone should be aware of.

Today's post is centered around my old home state of New Jersey. Visiting the state this week caused me to see a number of billboards that were sponsored by a group sarcastically calling itself "Millionaires For Christie." Chris Christie is the current governor of New Jersey. The billboards and associated website were trying to raise the issue that as a result of Christie refusing to increase the state income tax on New Jersey millionaires, others in the state were suffering.

The associated website goes through some of the budget cuts that were made under Christie's watch, all of which seemed to be associated with education programs. This turned out not to be surprise once you paged down to the bottom of the website's page and saw that the primary New Jersey teachers' union was operating the site. The Governor and the union leadership have had a number of public confrontations since the governor was elected. Thus, I started to understand where the sarcasm and Millionaires for Christie effort was coming from, his main political opponent.

Before going through some of the items on the website, let's look at some independent sources of analysis and data to understand where New Jersey is currently sitting from an economic perspective:

- When Christie came into office, New Jersey faced a $10.5 billion budget shortfall, according to http://www.nj.com/ in a July 7, 2010 article.

- According to the Center On Budget and Policy Priorities, an organization that appears to be an expert on state government budgets and economics, the state will again face a budget deficit in excess of $10 billion in fiscal year 2012.

- This 2012 fiscal shortfall places New Jersey's deficit as the third worst state budget from a total dollar deficit ($10.5 billion) and the second worst state from a percentage basis (37.4%).

- A November, 2010 article from Kiplinger ranked New Jersey as the third worst state to retire in from a taxation perspective.

- A recent Forbes article placed New Jersey as the fifth most taxed state in the union.

- A detailed state-by-state analysis by the Tax Foundation in 2008 found that New Jersey had the worst state and local tax burden in the country, 11.8%. Knowing what I know about New Jersey, it is doubtful that this position has changed radically over the past few years.

- A recent article from Reason magazine quoted an expert source which calculated that the New Jersey public employee pension fund would run out of money in about seven years, requiring all of the pension outlays to then be paid out of current year state tax dollars.

Thus, it really cannot be argued that New Jersey is in bad fiscal shape even though it is one of the highest taxing state governments by anyone's measure or criteria.

Now, back  to the Millionaires For Christie effort. According to their website, if Christie had approved an additional tax for millionaires in the state, the state government would have annually received an additional $637 million. However, there are a few problems with this assertion:

- Even if the state received the additional $637 million, according to independent budget estimates from neutral parties, this would leave the state short about $9.9 billion or 94% of its needed revenue. Isn't the bigger problem still on the table even if the additional money is received? Shouldn't that be the focus, how to wipe out the inherent, structural fiscal problem that results in billions and billions of budget shortfall every year rather than only 6% of the shortfall?

- Even if the state received the additional $637 million in the first year, if no action was taken to correct the underlying cost structure problem, what happens when the "Maryland effect" kicks in a few years later.

You recall in a previous post in this series we documented what happened when the state of Maryland instituted a millionaire's tax. The number of millionaires filing state income taxes dropped by 30% very quickly and the state expectation of receiving an additional $106 million turned into a $267 million deficit relative to tax receipts from millionaire's. If that was to happen in New Jersey, which is more than likely, then the rest of New Jersey taxpayers, the non-millionaires, would end up paying the freight since the state government and political class never fixed the underlying cost structure.

- The website lists how much money was cut from various programs. However, it does not say what percentage of the total program costs that represents. For example, if a program costs $2m to operate and $1 million is cut, that is significant. However, if the program costs $100 million to run and $1 million is cut, that is not significant.

Thus, by not showing both the absolute and the relative size of the cuts, the website leaves the impression that everything is a crisis where that may not be the case to suspicious people like myself. If all of these cuts are relatively small on a percentage basis, their cause will lose my sympathies, given the overall disaster that the total state budget is in.

- Christie's cuts in trying to get spending in line with revenue fell heavily on everyone and every program in the state including education. But since education is one of the biggest budget lines, there was no way that education funding could not be affected.

That is a fact that seems to be lost on the Millionaires for Christie effort and backers. All of the examples they cite are relative to education and the interests of the teachers' union. They provide no constructive input on how else to get state budget costs under control, it is nothing more than a rant about their interests getting cut.

Given the overwhelming evidence that New Jersey is on the edge of a fiscal collapse, it would have been more constructive and credible to come to the table with a plan that could solve the education problem and the budget problem as opposed to ranting about "Christie's Cuts."

- The group and website act as if Christie is personally holding back funds and is just a bastard. The fact of the numbers is that the state does not have the revenue, Christie cut in order to fulfill the state constitution requirement of a balanced budget. To infer these are
Christie's personal cuts is a juvenile way to approach a problem and reality.

Should millionaires be taxed more in New Jersey? I do not know, that is a subjective opinion. That is up to the residents of New Jersey to determine. But understand that if they do raise the taxes on millionaires without fixing the underlying cost structure, in a few years they are likely to have much less revenue from millionaires, ever higher state government costs, and the need to raise taxes on everyone, not just millionaires. That is the likely long term reality. The root cause of the problem is out of control state spending, not Christie personally making budget cuts.

And higher taxes on everyone to meet today's out of control state government expenses will eventually bump into the reality of raising taxes still more in about seven years to pay for state pension shortfalls. All of these events will eventually cement New Jersey's reputation as the most taxed state in the union.

And that is why I am no longer a New Jersey resident. I grew up in New Jersey and after graduating from an out-of-state college, returned to New Jersey. My wife also grew up in New Jersey and together we worked almost a combined fifty years in New Jersey jobs. I started a successful small business in New Jersey. We have a ton of friends and family in New Jersey. We enjoyed the Jersey shore, the Jersey mountains, and just about every other aspect of life in New Jersey.

However, we left in 2005 and moved to Florida for the simple reason of a New Jersey political class that did not have any fiscal sanity or clue, both Democrats and Republicans. What have we gained by moving to Florida:

- In 2005, the year we left New Jersey, we paid over $12,000 a year in property taxes. We did not have any municipal services and were served by the state police and a volunteer fire company. I cannot imagine how much our property taxes would be today, six years later, in that typical suburban New Jersey house.

- In 2011, we will pay under $4,000 a year in Florida property taxes. Thus, at a bare minimum, we are saving $8,000 a year vs. New Jersey or about $670 a month, in property taxes.

- Our Florida property taxes have gone down every year since we moved here and they are capped at no more than a 3% increase a year.

- We pay absolutely no state income taxes in Florida.

- Florida was not listed in the Reason magazine as having a looming state pension problem like New Jersey has.

- We still see a lot of New Jersey friends and family as the escape New Jersey winters for the warmth of Florida.

- Some New Jersey teachers might claim that Florida schools are not as good as New Jersey schools and that is why taxes are so much higher in New Jersey, the taxes pay for a higher quality education. Why that may have historically been the case, Florida has been working hard over the past decade to improve their schools' quality. In fact, according to the latest Newsweek annual analysis of the nation's high schools, eighteen of the top 100 schools are currently in Florida, only one is in New Jersey, deflating the whole argument that New Jersey pays more taxes for a better level of education.

Thus, there were plenty of reasons for us to stay in New Jersey but the state government, the state political class, and the state tax burden made that impossible. I believe we were net contributors to the state of New Jersey. We never collected unemployment, we never went on welfare, we paid our taxes on time, we volunteered in our community, we used our disposable income to frequent New Jersey restaurants, movie theaters, and other businesses.

However, I would bet that we are not alone in the decision we made to leave, that individuals, families and businesses have reached the same conclusion or will soon reach that same conclusion. Raising taxes on millionaires in New Jersey is certainly a budget option. So is the nasty downstream implications if the state's political class does not fix the underlying root causes of excessive spending since those root causes will not go away but the millionaires might.



Our book, "Love My Country, Loathe My Government - Fifty First Steps To Restoring Our Freedom And Destroying The American Political Class" is now available at http://www.loathemygovernment.com/. It is also available online at Amazon and Barnes and Noble. Please pass our message of freedom onward. Let your friends and family know about our websites and blogs, ask your library to carry the book, and respect freedom for both yourselves and others everyday.


Please visit the following sites for freedom:



http://www.loathemygovernment.com/
http://www.cato.org/http://www.robertringer.com/

http://realpolichick.blogspot.com/
http://www.flipcongress2010.com/
http://www.reason.com/


http://www.repealamendment.com/

Higher Taxes = Fewer Residents? Who Would Have Thought!

It has been interesting to see some of the early results being published from the 2010 Census. Of particular interest were some results published in the January 3, 2011 issue of Businessweek Magazine. The article listed out all of the states that would be gaining or losing seats in the House Of Representatives as a result of their population going up or down from the last Census in 2000.

These results raise an interesting question: is it possible that those states that gained population and thus, additional representation in Congress, are also the states that place the lowest tax burden on their residents?  In other words, do higher state taxes encourage residents of that state to move elsewhere for a better life style as a result of lower taxes elsewhere?

One analysis approach is to look at the correlation between House seats lost or gained and the tax burden in each of those states. One way to that is to use the latest state-by-state results from the Tax Foundation. The Tax Foundation published their latest annual results  from their State Business Tax Climate Index in late 2010. Their index rank orders each state along five tax parameters, corporate income tax, personal income tax, state sales tax, state unemployment tax, and property tax. After ranking each state along each of these five taxes, they produce an overall index for each state.

Their overall index goes from 1 to 50. The state with an overall index of 50 is deemed by the Tax Foundation to place the heaviest tax burden on its residents. The state with an index value of 1 is deemed to place the lightest tax burden on its residents. Thus, if you combine the Census results from the Business Week article with the Tax Foundation work, you come up with the following:

States Losing Two Congressional Seats:
- New York - Index = 50
- Ohio - Index = 46
Average Of States Losing Two Seats = 48

States Losing One Congressional Seat:
- Illinois - Index = 23
- Iowa - Index = 45
- Louisiana - Index = 36
- Massachusetts - Index = 42
- Michigan - Index = 17
- Missouri - Index = 16
- New Jersey - Index = 48
- Pennsylvania - Index = 26
Average of States Losing One Seat = 32

States Gaining One Congressional Seat:
- Arizona - Index = 34
- Georgia - Index = 25
- Nevada - Index = 4
- South Carolina - Index = 24
- Utah - Index = 9
- Washington - Index = 11
Average Of States Gaining One Seat = 18

Florida Is Gaining Two Seats - Index = 5

Texas Is Gaining Four Seats - Index = 13

A few observations:

• The Illinois index rating is now probably much worse than when the Tax Foundation did their report since the Illinois legislature significantly raised corporate and personal income taxes within the last week with personal income taxes going up 66%.
• New York lost another two seats this time around and according to the article, it is down from a high of 45 Congressional seats as recently as 1940. The 27 seats are the lowest amount of seats for New York since 1810.
• While Louisiana lost a Congressional seat, there is a good chance that some of that loss was do to the lingering effects of Hurricane Katrina.
• New Jersey got as high as 48, after being at 50 for a number of years, only because it lowered its highest personal income tax rate, an action that would have affected only a very small number of New Jersey residents.

The obvious conclusion and correlation is that the higher your tax burden, the more population you lost, as measured by the change in Congressional representation. It is not a perfect correlation but it is a strong correlation.

This analysis represents a high "correlation" of high tax burden to lost population, you would have to go much deeper to see if there was a true "causation" relationship, namely high taxes "cause" population loss. For example, if you overlay the results above on a map of the U.S., you could make an inference that those states gaining population tend to be in the southern, warmer part of the country (with the exception of Louisiana which is likely affected by Hurricane Katrina). Those losing population tend to be in the northern, colder part of the country so maybe Americans just want to be warmer.

However, I would maintain that the taxes are much more causation than the weather. Many of the coldest states in the country, Minnesota, the Dakotas, Wisconsin, Montana, Maine, Vermont, New Hampshire, etc. did not gain or lose Congressional seats. If weather was a driving factor vs. taxes, one would have expected at least some of these cold states to have lost seats. Thus, I would assume that taxes and not warmth are much more important in driving population shifts.

Another way of looking at the data is to overlay the Congressional results above with the two major political parties, the Democrats and Republicans:

• If you look at the past five Presidential elections, every one of the states losing population and Congressional seats, except for Louisiana, would be considered blue states or Democratic states. Again, Louisiana's status might have been unduly influenced by Katrina.
• Five out of the eight states that gained Congressional seats would have been considered red states or Republican states.
• Florida would have been one of those three states not considered Republican but since the last Presidential election, the state of Florida has a Republican governor, both houses of the state legislature are controlled by the Republicans, in some of the past five Presidential elections Florida did go Republican, and I believe that Republicans picked up seats in the Florida delegation to the House Of Representatives while holding the Republican Senate seat it already had. In other words, Florida would probably now be considered a red state.

Thus, again we see a very strong correlation, this time between high population lost or gained and political party. Those states with a strong Democratic  political influence tend to be the higher taxing states and the states losing people. Those with a strong Republican presence tend to be the lower taxing states and the states gaining people.

Thus, a very strong case can be made for a very simple premise: human beings like to keep what they earn and are likely implementing this premise with their feet, relocating to states where they can keep the results of their hard work. I know that is what my family did. We moved out of New Jersey in 2005, when its tax index rate a horrendous 50, and moved to Florida. In 2005, more than five years ago, we were paying about $12,000 a year in New Jersey property tax, a taxation amount that is likely much higher than it was over five years ago. We currently pay less than $4,000 a year in property taxes in Florida, a savings of at least $8,000 a year. In Florida, we also have no income tax to pay vs. a pretty substantial income tax that we would have to pay in New Jersey.

Both myself and my wife did not necessarily want to leave New Jersey. We both grew up there, we spent most of our careers there, and we left behind friends and family. However, the price to stay put was just too much, probably in excess of $10,000 a year once you take in account all of the tax implications. You can live a much better live, a much freer life, if you have an extra $10,000 in your pocket.

Which gets us to the overall lesson from all of this analysis. The higher the tax burden, the less amount of freedom an American has.  You cannot separate financial freedom from political freedom, they go hand in hand. The more you pay into the government, the less money you have for you and your family. You have less money to send your kids to a better school. You have less money to possibly start a business. You have less money to save for retirement. You have less money to donate to your favorite charity. You have less money to just enjoy your life. You have less freedom.

And it is not as if the government confiscates your hard earned money, money that you are now not free to spend as you like, and uses it for great programs that have a benefit to you and your family. It is typically wasted in ways to numerous to list here.

That is why Step 1 from "Love my Country, Loathe My Government" is so important. Step 1 would reduce the size of the Federal government by 10% a year by five years. The reasons for this goal would be to reduce what government does so that the political class and the government it runs work on a smaller set of more important issues, and hopefully by focusing on less getting more done.

Also, if you reduce the size and waste of government, you can eventually return those unused and unwasted taxes to the American people who have shown that they will look for the best economic deal for themselves and their families, and more freedom, even if it means moving to Texas, Florida, and other less tax heavy states. Who would have thought?






Our book, "Love My Country, Loathe My Government - Fifty First Steps To Restoring Our Freedom And Destroying The American Political Class" is now available at www.loathemygovernment.com. It is also available online at Amazon and Barnes and Noble. Please pass our message of freedom onward. Let your friends and family know about our websites and blogs, ask your library to carry the book, and respect freedom for both yourselves and others everyday.


Please visit the following sites for freedom:

http://www.cato.org/
http://www.robertringer.com
http://realpolichick.blogspot.com
http://www.flipcongress2010.com/
http://www.reason.com/
http://www.repealamendment

Wasting And Wanting: Our Politicians and Our Needy

In this time of Thanksgiving, I was quite annoyed by an Associated Press article this week. According to the article, the IRS has determined that it is losing out on about $380 million a year in income taxes when separated or divorced parents both claim their children as deductions on their tax forms, basically double counting the deductions they are entitled to and underpaying the IRS.


What was really annoying was the IRS spokesperson who said that while the tax agency had identified and quantified the non-payment of income taxes, they would do nothing to go after the abuse since it was not worth their time and resources. This kind of attitude raises any number of questions:

• When is a taxpayer abuse big enough for the IRS to get interested? $380 million sounds like a lot of money to me to go wanting, especially if you have done enough work to identify the abuse and quantify the abuse. Obviously, the IRS has already done some work on the issue.

• If the IRS acknowledges that it is missing out on $380 million on this just one, specific type of abuse, what other types of abuses are they not following up on? Fix a lot of $380 million abuses and before you know it you are saving some real money for the taxpayers.

• If the IRS does not have the time, resources, and desire to close down this abuse, why would they not hire a collection agency or company to do it for them in a risk free manner? Why would they not go to a collection specialist (or several) and offer a deal: we will give you 10% (or 15-20%) for every delinquent dollar you collect for this specific type of abuse. If the collection agency collects no money, they get no reward, Risk free, no money up front from the IRS to the collection specialists. I am sure there are plenty of capable collection agencies in the country that would salivate about the opportunity to collect on a multi-million bounty, especially since the IRS has done a lot of the identification work up front. Makes no sense to not follow in this manner - while the IRS would not get all $380 million, it would get something with very little risk vs. getting nothing.

However, let's put this abuse in Thanksgiving day terms, which is what really annoys me. The major supermarket chain in my area is Publix. For Thanksgiving, they are offering a deal where for $39.95 they will prepare a complete Thanksgiving Day dinner for your family. The dinner includes enough food to feed 8-10 people and includes several courses. If we assume that one purchase of $39.95 would serve two needy families this holiday season, then $380 million would theoretically serve 19 million needy American families if you could somehow transfer that tax shortfall from Americans who should have paid their correct taxes to Americans that might need a little help this holiday season.


Obviously, this is only a theoretical example, especially since 1) the government and political class would never be able to execute this massive type of program and 2) because the IRS/government is not even going to go after the $380 million abuse. This all gets back to our favorite new term: immobile government. Our Federal government has gotten so big and so inflexible that it rarely does the things it should do and has gotten its priorities so screwed up that one of its basic functions, helping citizens, usually gets lost in the bureaucracy of politics. In this type of country, the government should not be ignoring $380 million that is due to it while the needy go hungry.


Obviously, immobile government is created by the people that operate it, namely our political class. If government is immobile and ineffective, it has to be because our politicians have become the same. Think about it. Our politicians spend so much time on trivial matters that the big issues of taxpayer abuse and hungry Americans never get any kind of proper attention. They get up in arms about a mosque in New York City, or about a new caffeinated alcoholic drink, or about a college football playoff system or about the sound volume of television commercials or any of dozens of other non-issues. Meanwhile, taxes go uncollected and people go unfed.


Two steps from "Love My Country, Loathe My Government" would address these broader governance issues. Step 1 would reduce the size of government 50% over a five year period by doing a ground up review of all government functions, eliminating them that are as trivial as worrying about the sound volume of televisions. If politicians have far fewer things on their plate, maybe they can focus on the important ones and finally get something done.


Step 39 would impose term limits on all Federally elected political seats. Most of the current politicians have been in office for more than just a few terms. Their reign has resulted in immobile government and they should have their immobile bodies removed from their positions by any law or Constitutional amendment that limits their time in government. We need some mobility in office, mobility that would walk over to the IRS offices and demand that a way be found to get that $380 million that is due the American public. Once the IRS gets the $380 million, this new mobile government would go after the next tax abuse and then the next one and so on. Not getting the unpaid tax money and having American families wanting on Thanksgiving day is not acceptable.






Our recent book, "Love My Country, Loathe My Government - Fifty First Steps To Restoring Our Freedom And Destroying The American Political Class" is now available at www.loathemygovernment
 
Please visit the following sites for freedom:

http://www.cato.org/
http://www.robertringer.com/
http://realpolichick.blogspot.com
http://www.flipcongress2010.com/
http://www.reason.com/

President Obama's Administration in 2010 Vs. Orwell's Government in "1984"

I cannot help feeling that the Obama administration, and the entire American political class,  has some frightening similarities to the dysfunctional and totalitarian government that George Orwell foresaw in his classic novel, "1984." The loss of freedom, the frightening rise in power by the ruling political class, the declining quality of life for ordinary citizens, the manipulation and spin doctoring of reality,  etc. are very similar to the storyline in "1984."

Consider some George Orwell quotes, most of which come from the novel, and recent news accounts and events:

Orwell Quote: "The propagandist's purpose is to make one set of people forget that certain other sets of people are human."
Obama Administration: During the lead up to and after the passage of Obama's health care reform legislation, the President allowed members of his party to dehumanize those that had honest problems and issues with the legislation. Consider the slander:

• Speaker of the House Nancy Pelosi called those citizens opposed to Obama Care "un-American."
• Florida Congressman Alan Grayson called those citizens opposed to Obama Care "knuckle dragging Neanderthals."
• New York Congressman Charles Rangel likened those that opposed Obama Care to the real racists that opposed the early civil rights movement.
• Texas Congresswoman Shelia Jackson Lee also likened those opposed to Obama Care to the racists of the 1950s and 1960s.
• Alan Grayson stated that all Tea Party members were wearing white sheets 25 years ago, an obvious referral to the racist Ku Klux Klan movement.

Rather than celebrating diversity of opinion and debating the issues, the President allowed his henchman and women to bad mouth and slander those Americans for having a different opinion. Rather than acting Presidential and bringing people together by ending the name calling, the President became nothing more than the propagandist that Orwell talks about.

Orwell Quote: "War is a way of shattering to pieces or pouring into the stratosphere or sinking in the depths of the seas, materials which might otherwise be used to make the masses too comfortable, and hence, in the long run, too intelligent."
Obama Administration: Although this problem existed long before the President came into office, he has done nothing to counter what Eisenhower called the military-industrial complex. The United States, by far, is the biggest investor into military resources, by any measure you chose, in the entire world. We have troops stationed all over the world, defending interests and property that no longer need to be defended. Why do we have tens of thousands of troops in Europe? The Iron Curtain is down, communism has been defeated but still, we waste taxpayer money stationing troops there. Why do we have almost 30,000 troops in South Korea? They have one of the strongest economies in the world, let South Korea defend itself. Why do we have tens of thousands of troops in Japan? They are unlikely to attack Pearl Harbor again and these troops would be useless against any aggressive move by the massive Chinese army. Why do we not reorient these resources from defense to tax reductions and helping ordinary American citizens? According to Orwell, that would make the masses more comfortable and intelligent, two aspects that the political class would see as a threat to their own power.

Orwell Quote: "War is peace. Freedom is slavery. Ignorance is strength."
Obama Administration: Shortly after coming into power, the Obama administration decided to change the language when describing Islamic terrorism. His administration went on a journey to purge Bush era terms like "war on terrorism,"  "radical Islam," "jihadist," and Islamic terrorism" from all government publications, speeches, testimonies, etc. For example, rather than talk about "Islamic terrorism," the administration wants everyone to talk about "violent extremism."

Thus, it appears that Obama is trying to do the same word games that the government did in "1984." By controling language, you can control the situation. The problem with such an approach is while it may give those in power more control over the debate of a specific issue, it obscures the true reality of the situation. If you do not understand the reality of an issue, the chances of successfully solving that issue are minimized. How can you argue against war if it has the same meaning as peace? How can you solve the problem of Islamic terrorism if you deny that it exists? Obama's attempt to control the language will put us further away from understanding the root cause of the Islamic fanaticism and how to defend against it.

The further problem with this language gambit is that it has not worked. According to an October, 14, 2010 Yahoo News article, several studies are now showing that changing the language is not solving any problems. A study by the Brookings Institution in Washington found that between May, 2009 and May, 2010, the number of Middle Eastern Arabs expressing optimism in Obama's approach toward their region dropped from 51% to 16% with those becoming discouraged with the President rising from 15% to 63%. A Pew Reserach Center study shows that in August, 2010, fewer Americans held a favorable view of Islam, 30%, than during the Bush administration (41%). The Pew study also found that more Americans (35%) say Islam encourages violence more than other religions, up from 25% in 2002.

Thus, not only is this process of muddying the waters of language a bad way to solve problems, these two studies show that Obama's purging of our government's vocabulary is not working, either domestically or abroad from an attitude perspective.

Orwell Quote: "And if all others accepted the lie which the Party imposed - if all records told the same tale - then the lie passed into history and became truth. 'Who controls the past controls the future. Who controls the present, controls the past'"
Obama Administration: three examples here where the administration has tried to control and suppress information and perpetuate the lie in order to advance its own agenda. If you can suppress contrary views, you can control the past, the present and the future that the political class wants.

The first example was from early in the Obama administration. EPA engineer, Alan Carlin, researched and then wrote a 98 page report that challenged some of the assumptions and predicted outcomes regarding global warming that were at odds with what the Obama administration wanted to hear. Mr. Carlin has an undergraduate degree in physics from Cal Tech and a PhD in economics from MIT so that he is not an uneducated scientist. However, he was told to suppress his findings and not communicate them to anyone outside of the agency. Rather than discuss his findings publicly and have a scientific debate over his conclusions, the political class, in this case the Obama administration, decided to suppress the analysis and possibly perpetuate the potential lie of global warming. In all of the news reports I saw in this matter, no one was questioning Mr. Carlin's methodology, analysis, etc., it was purely a political suppression of information, something that Orwell would have been proud of. By suppressing information like this, the political class can control the debate and any kind of control is not good in a democratic society since it usually does not help arrive at the right solution for a problem. Is the administration tyring to pass the lie into history and make global warming the truth, contrary to a scientific conclusion that it was not the truth?

The EPA report suppression is not the only instance where the Obama administration tried to suppress information. A soldier at Fort Hood who videotaped the killing spree by Major Nidal Hasan was told by his commanding officer to delete the video. The soldier testified that a non-commissioned officer, acting on orders from an officer, was told to delete the video the same day of the shooting. Now why would anyone want to delete a videotaping of a live crime, wouldn't it be a great piece of evidence at the trial of the shooter? Is the Obama administration trying to control the situation by controlling the information? No reason for that video to have been destroyed unless someone, somewhere high up the chain of command did not want to lose control of the situation, even if justice was not served in the process.

Finally, consider an Associated Press report that appeared on October 6, 2010. According to the article and a finding by the commission appointed by the President to investigate the Gulf oil spill disaster, the Obama White House deliberately blocked efforts by government scientists to tell the public just how bad the oil spill could become. The article also reported that other missteps and incompetence were also suppressed by the Administration.

According to the article, the commission's documents "show that the White House was directly involved in controlling the message as it struggled to convey that it, not BP, was in charge of responding..." There is that pesky word again, controlling. Control the information and you can control the lie, control the lie and history will turn that lie into the truth. If the Obama administration focused more on the oil spill and the root cause of the Fort Hood shooting and the reality that global warming might be a piece of fiction, and less on controlling the lie, the country might be better off, even if the political class was worse off.

Orwell Quote: "The most effective way to destroy people is to deny and obliterate their own understanding of their history."
Obama Administration: Consider an October 20, 2010 article from the Heritage Foundation that covered a speech that the President recently gave in Rockville, Maryland. In that speech he quoted from the Declaration of Independence: "We hold these truths to be self-evident, that all men are created equal, that each of us are endowed with certain unalienable rights, that among these are life, liberty, and the pursuit of happiness."  Sounds harmless enough, right? Celebrating our heritage. But look closely, he did not "exactly" quote the Declaration of Independence. The accurate quote reads as follows: We hold these truths to be self evident, that all men are created equal, that they are endowed by their Creator with certain unalienable rights, that among these are life, liberty, and the pursuit of happiness."

According to the article, the President omitted the exact same phrase from two other recent speeches, the Congressional Hispanic Caucus Institute's 33rd Annual Awards Gala and at a New York City fundraiser. Once is an oversight, three times inside of a month is a trend. Sounds very Orwellian to me, "to deny and obliterate their own understanding of their history." Denying the words "By Their Creator" may run contrary to the President's beliefs but it is our history. It all gets back to the examples above, the political class is constantly trying to control history, the lie, the information flow, and the decision process, all of which are detrimental to freedom.

Orwell Quote: "There was no way of knowing whether you were being watched at any given moment. How often, or on what system, the Thought Police plugged in on any individual wire was guesswork. It was even conceivable that they watched everybody all the time. But at any rate they could plug in your wire whenever they wanted to. You had to live - did live, from habit that became instinct - in the assumption that every sound you made was overheard, and, except in darkness, every movement scrutinized."
Obama Administration: Very simple analogy here, " the Patriot Act." Passed during the Bush Administrating and rubber stamped renewed under the Obama administration we are rapidly approaching this Orwellian world of surveillance. The scary thing is that Orwell probably did not imagine how many ways this quote could come true today. From getting access to our library records, tapping our phones, tracking our movements via our cell phone signal, monitoring our emails, observing our social network activity, watching us via thousands and thousands of public video cameras to easy to get warrants and wire taps, the pervasive intrusion into our lives by the political class is the Orwellian nightmare we face today, a reality not conducive to freedom at all.

Orwell Quote: "Political language... is designed to make lies sound truthful and murder respectable, and to give an appearance of solidity to pure wind."
Obama Administration: the best example of Obama Orwellian thinking under this quote is the failed economic stimulus plan that Obama and the Democrats passed. The original purpose of the stimulus plan was to create jobs. When the stimulus money started to get spent but very few jobs were created, the Obama administration changed gears and stated the economic stimulus package was to both create AND save jobs. However, when not many jobs were created AND saved, the administration came up with the term like jobs "affected" or "touched" by the economic stimulus package. Thus, if the first definition does not work, try a second definition and a third definition, etc., anything to give an appearance of solidity to pure wind. In this case, the pure wind is the utter failure of the stimulus package to create solid jobs.

Orwell Quote: "Doublethink means the power of holding two contradictory beliefs in one's mind simultaneously, and accepting both of them."
Obama Administration: The best example here is the whole problem of illegal immigration and the immigration law passed this summer by Arizona, a law that was patterned after the existing Federal law regarding illegal immigration. The Obama administration has gone to court in an attempt to overturn a law that a state wants to use to return illegal immigrants to their respective countries, hopefully improving the living conditions of the state's citizens. At the same time, the Obama administration has been returning record numbers of illegal immigrants to their respective countries and has beefed up security along the Mexico/U.S. border. Sounds like Doublethink to me: from the Obama administrationn perspective, we will vilify the Arizona law for doing the same thing we are doing at the Federal level, i.e. returning illegal immigrants to their countries. Doing the same think but holding one effort as bad but the other effort as good.

Orwell Quote: "Never again will you be capable of ordinary human feeling. Everything will be dead inside you. Never again will you be capable of love, or friendship, or joy of living, or laughter, or curiosity, or courage, or integrity. You will be hollow. We shall squeeze you empty and then we shall fill you with ourselves."
Obama Administration: This quote response is not just via the Obama administration but by the whole American political class. Right now, the politicians in this country control a large part of our retirement financials via Social Security, they control our retirement health care via Medicare, they control our personal wealth and income via dozens and dozens of government taxes and fees, they control the education of our kids via public schooling, they control a larger portion of our pre-retirement medical care via Obama Care, they control who we eventually get to vote for (via gerrymandering of Congressional districts, controlling of campaign financing sources, using taxpayer money to fund earmarks which are just campaign finance tools, etc.), they control and criminalize what substances we put into our bodies, they belittle us for daring to have a difference of opinion, and they control who gets certain rights based on sexual orientation. They use these forms of control to drain us of our individuality in order to make us more controllable and reliant on their needs and desires. Orwell nailed this one right on the nose when describing life under our political class in American today.

Very scary stuff. As Orwell predicted, the United States and other democracies around the world are at risk of failing not because of some outside agency or foe but by the devious and dishonest manipulations of truth and the ever increasing control by our own political class. That is why every election now becomes so critical if we are to turn back our march towards "1984" and again become a free country, of the people by the people and for the people.

We no longer can allow the political class to control the debate, control the language and control our lives. That is why many of the steps in "Love My Country, Loathe My Government" need to become a reality as soon as possible:

• Reduce government's size by 10% a year for the next five years.
• Review and amend the Patriot Act to make it more freedom and liberty friendly.
• Stop gerrymandering Congressional districts to level the playing field between incumbents and new political candidates.
• Implement term limits to eliminate politics as a career opportunity.
• Bring home almost all of our foreign deployed troops and begin downsizing the military-industrial complex.
• Start reducing the deficit and the debt grip politicians will hold over us for decades to come.
• Repeal Obama Care and fix the health care crisis the right way, not the controlling political class way.

So much work to do and so little time to do it before Orwell proves himself right. We are living George Orwell's "1984" and it is disguised as Obama's 2010 agenda. Stop the madness, stop the doublespeak, stop the lies.



Our new book, "Love My Country, Loathe My Government - Fifty First Steps To Restoring Our Freedom And Destroying The American Political Class" is now available at www.loathemygovernment.com. It is also available online at Amazon and Barnes and Noble. Please pass our message of freedom onward. Let your friends and family know about our websites and blogs, ask your library to carry the book, and respect freedom for both yourselves and others everyday.


Please visit the following sites for freedom:


http://www.cato.org/

http://www.robertringer.com/

http://www.realpolichick.blogspot.com/

http://www.flipcongress2010.com/

http://www.reason.com/

Year End Review: The Good, The Bad and The Ugly - Today = The Good

As 2009 approaches an end, I thought it would be a good idea to review what we have been discussing the past six months since the publication of the book, "Love My Country, Loathe My Government." I have entitled the review "The Good, The Bad and The Ugly", based on an old western movie starring Clint Eastwood. Today I will review some of the good things we discussed as it related to the political class (the good), tomorrow we will review some of the ugly things the political class has done to the country and its citizens (the bad) and the next day we will review the incredible wasted of taxpayer dollars and government resources the political class has wasted. Each day I will pick the very best good, the very best bad and the very best ugly.

Before we start, please note two things. First, all of the instances of political activity I will review have already been discussed and analyzed in previous posts to this blog. Thus, for more detail on anything listed and discussed in the next three days you can review the past posts. Second, everything discussed in the next three posts come from credible news sources, these are not facts and stories I made up or are coming from highly partisan sources. Typical sources include CNN, the Associated Press, the New York Times, The Week Magazine, Reason magazine and other news sources. While I will not identify the sources again in these review posts, you can refer to the original posts to get the date and source referenced for the information.

Tonight I will review the good things the political class has done in my opinion in the past six months. Unfortunately, I was able to only come up with three instances of success, i.e. the actions of the political class members involved had the taxpayer and fellow citizens in mind when they executed their actions:

1) The first example is based on personal experience. I live in Pinellas county in Florida and over the past four years my property taxes have gone down on a year over year basis. They have gone down so much that I now pay about 40% in less in property taxes today than I paid four years ago. There are probably a number of factors, both political and non-political, that have gone into this decrease but the bottom line is that they have gone down significantly. And here is the good news: I still have police protection, I still have fire protection, the schools are still open, the parks are still open, most of the libraries are still open and the roads and traffic lights are still in good shape. This is proof to me, on a very local level, that excess waste can be taken out of government without substantial reduction in essential protection and services. The primary word in that previous sentence is essential.

2) The second example comes from the U.S. Senate and it was a suggestion and formal proposal to the Senate from Senator Lamar Alexander from Tennessee. His reasoning: since the Federal government paid about $60 billion of U.S. taxpayer money to acquire a 60% share of General Motors and theoretically save it from bankruptcy, shouldn't each American taxpayer get stock certificates and partial ownership of GM rather than the Washington bureaucrats? After all, government is able to function only because it takes money from taxpayers, if government acquires ownership in a private company, doesn't that mean that the taxpayers own the company since it was their money? Senator Alexander was the single politician this year that showed he understood the relationship between paying taxes and government spending. Giving individual citizens those shares of GM would ensure more interest in how GM performed going forward since each citizen would have had a stake in its survival, probably giving GM a better shot at survival than it has with government ownership.

3) The final example comes form a small town in south Florida, Miami Gardens. In the past year, Miami Gardens city government took the following actions:

• The city payroll grew. Most everywhere else in the country unemployment increased.
• City employees still got cost of living raises and merit raises. Most everywhere else in the country salaries and wages were frozen or reduced.
• The city increased its financial reserves by about $300,000. Most everywhere else in the country, local and state governments dipped into their reserves to cover operating costs.
• The city upgraded 17 parks and 4 schools. Most other government entities were reducing or eliminating maintenance projects.

How was Miami Gardens able to do all of these positive things in light of a very, very deep recession and the fact that they are not a city of wealthy residents? According to interviews with city officials:

• City employees share both personnel resources and other resources.
• The city hires only those people they actually need to do the work needed to be done.
• City officials claim they have the ability and backbone to say "No" to non-essential projects and programs, claiming that they cannot be everything to everybody.

Thus, much like my first example above, the Miami Gardens politicians have shown that running a lean, efficient operation is possible if you are respectful of taxpayers' dollars.

And the winner of "The Good" award is....... Miami Gardens city government. I applaud Senator Alexander's creative thinking and understanding that government exists only because it collects taxes, not because it itself generates wealth. However, his wise idea was never implemented. And while my personal property taxes have gone down without a detrimental effect on government services, I believe a number of factors were involved, including declining real estate values, not just government actions. Thus, while I am grateful for the reduction, not all of it was the work of the political class.

Miami Gardens city government, however, demonstrated that by respecting the taxpayers and the taxes that are paid, government can be run smoothly, efficiently, and effectively. All it takes is a little planning and the ability to just say No.

Visit our website at www.loathemygovernment.com to order an autographed copy of the book, "Love My Country, Loathe My Government -Fifty First Steps To Restoring Our Freedom and Destroying The American Political Class" and to sign up for the cause. The book is also available online at Amazon and Barnes And Noble.