Better to be a Badger than a Gopher
By
Rory Ryan-hcpress@cinci.rr.com
More than 10,000 people are known dead and many more are missing after a 9.0 magnitude earthquake off the coast of northern Japan on Friday, March 11. Think about that. More than 10,000 known dead.
The earthquake triggered a tsunami, bringing a 33-foot wall of seawater.
Thousands of bodies have washed ashore in the aftermath. Then, the Shinmoedake volcano erupted on the Kyushu island on Sunday, March
13.
Thousands of displaced residents and island visitors are homeless, lining up for handouts of water and food, and spending the nights outside in near-freezing temperatures.
The Los Angles Times reported in a part of Iwanuma city, near Sendai airport, “waves about 30 feet high carried entire homes across a pretty canal, a four-lane road and into an industrial area. One yellow house was plunked down nearly intact, Wizard of Oz style, on top of a gas station.”
The photos and videos coming from Japan most likely are not capable of depicting the true severity of this atrocity. But they are, nonetheless, shocking and compelling.
“This disaster has in effect temporarily frozen the world’s third largest economy,” said Richard Soultanian of NUS Consulting.
Radiation continues to leak from multiple nuclear power facilities.
Meanwhile, most of us (myself included) worry and complain about things that are really quite trivial and inconsequential by comparison. Tens of thousands of dead bodies can have a chilling effect on one’s overall perspective.
Let’s keep the people of Japan in our thoughts and prayers as they recover and rebuild from this natural disaster.
* * *
I received an e-mail this week containing a copy of an article in The Wall Street Journal entitled “Badgers vs. Gophers.” And it had nothing to do with March Madness or Big Ten basketball.
Badgers vs. Gophers is a lesson in politics about Wisconsin and Minnesota.
“Wisconsin and Minnesota are often lumped together as similar states, but this year they are showing how elections matter,” the WSJ wrote. “In November, the Badger State elected a GOP legislature and Republican Scott Walker (as governor), who is trying to cut spending and taxes, while Minnesota voters narrowly chose liberal Democrat Mark Dayton, who is doing the opposite.
“To close Minnesota’s budget deficit, Dayton first proposed to raise the state’s top income tax rate to 13.95 percent from 7.85 percent. That would have given Minnesota the distinction of having the highest state income tax in the nation, racing ahead of current leaders Oregon and Hawaii at 11 percent. … He defends this tax wallop by arguing it is about “restoring tax fairness” in Minnesota.
“Fairness? According to the state’s own tax data, the richest 10 percent of Minnesota families already provide 54 percent of the state’s income tax revenue. The bottom 10 percent make money off the income tax as they get cash-back tax credits.”
Meanwhile, as the Journal reports, “In Wisconsin, government unions are fighting furiously against Gov. Walker’s cuts in state employee benefits. Their alternative? Raise taxes the way Gov. Dayton wants to do. In recent years, this has become the default union policy and thus the first priority nearly anywhere that Democrats get power.”
While the WSJ only talked about Badgers and Gophers, it could easily have added another Big Ten state in the debate. Thus far, it appears that Ohio Gov. John Kasich is more like the Badger than the Gopher. (Ohio has already tried the Gopher route. It was a dead end.)
So, really, what reasonable choice does Gov. Kasich have? Sure, he could raise taxes on a state that’s losing citizens and congressional seats almost as fast as it’s been losing jobs the past four years. (Let’s remember that Ohio’s unemployment rate was 5.3 percent in January 2007. It was 9.3 percent by the time the last governor left office.) The last four years have resulted in more private-sector job losses and more Ohioans leaving for states like Indiana, Texas and Florida.
Add to the unemployment problem the fact that former Gov. Ted Strickland placed $8.7 billion in one-time federal stimulus money in Ohio’s current two-year budget. Therein lies the almost $9 billion budget deficit that must be addressed by Gov. Kasich and the General Assembly.
Simple arithmetic tells us that there aren’t enough “rich” to tax to balance either the state or national budget.
In a great column this week, Kevin D. Williamson, deputy managing editor of National Review and author of “The Politically Incorrect Guide to Socialism,” explains: “There aren’t enough millionaires.”
“When President Barack Obama talks about the rich, he’s talking about people living in households with income of more than $250,000 or more. … Club 250K isn’t all that exclusive, and most of its members aren’t the yachts-and-expensive-mistresses types.
“Nonetheless, there aren’t that many of them. In fact, in 2006, the Census Bureau found only 2.2 million households earning more than $250,000.”
The majority of those household incomes are closer to $250,000 than to $250 million. Or even $1 million.
Williamson continues: “The 2012 deficit is forecast to hit $1.1 trillion under Obama’s budget. (Thanks, Mr. President!)
“Spread that deficit over all the households in Club 250K and you have to jack up their taxes by an average of $500,000. Which you simply can’t do, since a lot of them don’t have $500,000 in income to seize: Most of them are making $250,000 to $450,000 and paying about half in taxes already. You can squeeze that goose all day, but that’s not going to make it push out a golden egg.”
“Repealing all of those Bush tax cuts, for rich and middle class alike, gets you about $3 trillion — over 10 years. The deficit is running from a third to almost half that every year. (It) will not balance. (It) does not compute. … Every time you raise the threshold for eating the rich, you get a much, much smaller serving of meat on the plate – but the deficit stays the
same. The long division gets pretty ugly. You end up chasing a revenue will-o’-the-wisp.”
It’s the same on the state level in Ohio, Wisconsin, Minnesota and elsewhere.
Increasing taxes on a shrinking private sector will not get the state the $8 billion it needs. The better strategy, as Gov. Kasich is proposing, is a mixture of spending cuts and business incentives that will expand the tax base through job creation and a better economy.
We know from history that both the Kennedy tax cuts and the Reagan tax cuts increased tax revenues. With the Kennedy cuts, tax revenues increased 62 percent, from $94 billion in 1961 to $153 billion in 1968. The Reagan tax cuts increased tax revenues by 99 percent during the 1980s over a seven-year period.
As Mr. Williamson said: “Just as supply-siders are naïve to think that tax cuts are going to magically empower us to grow our way out of this mess, progressives are naïve to think that there is some magically delicious pot of Lucky Charms at the end of the IRS rainbow that is going to get us out of this in some kind of obvious or straightforward fashion.”
While our friend Jim Surber opines on Page 5 this week against the Badger and Buckeye tack, he doesn’t offer much in the way of balancing the budget.
True, as Jim says, elections do have consequences. But we shouldn’t leap to the conclusion that the respective governors of Wisconsin and Ohio aren’t doing what the voters elected them to do.
Four years ago, Ohio elected a Democrat governor in Ted Strickland whose entire career has been as a champion of government spending – including that as a strong supporter of the largest tax increase in U.S. history, Clinton’s infamous retroactive tax hike of 1993. (And, please, do not even think of referencing the mythical “balanced budget” of the Clinton era. It never happened.)
In Strickland’s four years as governor, Ohio’s jobless rate doubled and the deficit swelled to $8 billion or more. Sure, we can blame Taft or Voinovich or even Gov. Foraker. But that will not move the state forward.
We know the Strickland approach failed. Time will tell if Gov. Kasich’s way is any better, but it is off to an encouraging start.
Rory Ryan is publisher and editor of The Highland County Press.[[In-content Ad]]
The earthquake triggered a tsunami, bringing a 33-foot wall of seawater.
Thousands of bodies have washed ashore in the aftermath. Then, the Shinmoedake volcano erupted on the Kyushu island on Sunday, March
13.
Thousands of displaced residents and island visitors are homeless, lining up for handouts of water and food, and spending the nights outside in near-freezing temperatures.
The Los Angles Times reported in a part of Iwanuma city, near Sendai airport, “waves about 30 feet high carried entire homes across a pretty canal, a four-lane road and into an industrial area. One yellow house was plunked down nearly intact, Wizard of Oz style, on top of a gas station.”
The photos and videos coming from Japan most likely are not capable of depicting the true severity of this atrocity. But they are, nonetheless, shocking and compelling.
“This disaster has in effect temporarily frozen the world’s third largest economy,” said Richard Soultanian of NUS Consulting.
Radiation continues to leak from multiple nuclear power facilities.
Meanwhile, most of us (myself included) worry and complain about things that are really quite trivial and inconsequential by comparison. Tens of thousands of dead bodies can have a chilling effect on one’s overall perspective.
Let’s keep the people of Japan in our thoughts and prayers as they recover and rebuild from this natural disaster.
* * *
I received an e-mail this week containing a copy of an article in The Wall Street Journal entitled “Badgers vs. Gophers.” And it had nothing to do with March Madness or Big Ten basketball.
Badgers vs. Gophers is a lesson in politics about Wisconsin and Minnesota.
“Wisconsin and Minnesota are often lumped together as similar states, but this year they are showing how elections matter,” the WSJ wrote. “In November, the Badger State elected a GOP legislature and Republican Scott Walker (as governor), who is trying to cut spending and taxes, while Minnesota voters narrowly chose liberal Democrat Mark Dayton, who is doing the opposite.
“To close Minnesota’s budget deficit, Dayton first proposed to raise the state’s top income tax rate to 13.95 percent from 7.85 percent. That would have given Minnesota the distinction of having the highest state income tax in the nation, racing ahead of current leaders Oregon and Hawaii at 11 percent. … He defends this tax wallop by arguing it is about “restoring tax fairness” in Minnesota.
“Fairness? According to the state’s own tax data, the richest 10 percent of Minnesota families already provide 54 percent of the state’s income tax revenue. The bottom 10 percent make money off the income tax as they get cash-back tax credits.”
Meanwhile, as the Journal reports, “In Wisconsin, government unions are fighting furiously against Gov. Walker’s cuts in state employee benefits. Their alternative? Raise taxes the way Gov. Dayton wants to do. In recent years, this has become the default union policy and thus the first priority nearly anywhere that Democrats get power.”
While the WSJ only talked about Badgers and Gophers, it could easily have added another Big Ten state in the debate. Thus far, it appears that Ohio Gov. John Kasich is more like the Badger than the Gopher. (Ohio has already tried the Gopher route. It was a dead end.)
So, really, what reasonable choice does Gov. Kasich have? Sure, he could raise taxes on a state that’s losing citizens and congressional seats almost as fast as it’s been losing jobs the past four years. (Let’s remember that Ohio’s unemployment rate was 5.3 percent in January 2007. It was 9.3 percent by the time the last governor left office.) The last four years have resulted in more private-sector job losses and more Ohioans leaving for states like Indiana, Texas and Florida.
Add to the unemployment problem the fact that former Gov. Ted Strickland placed $8.7 billion in one-time federal stimulus money in Ohio’s current two-year budget. Therein lies the almost $9 billion budget deficit that must be addressed by Gov. Kasich and the General Assembly.
Simple arithmetic tells us that there aren’t enough “rich” to tax to balance either the state or national budget.
In a great column this week, Kevin D. Williamson, deputy managing editor of National Review and author of “The Politically Incorrect Guide to Socialism,” explains: “There aren’t enough millionaires.”
“When President Barack Obama talks about the rich, he’s talking about people living in households with income of more than $250,000 or more. … Club 250K isn’t all that exclusive, and most of its members aren’t the yachts-and-expensive-mistresses types.
“Nonetheless, there aren’t that many of them. In fact, in 2006, the Census Bureau found only 2.2 million households earning more than $250,000.”
The majority of those household incomes are closer to $250,000 than to $250 million. Or even $1 million.
Williamson continues: “The 2012 deficit is forecast to hit $1.1 trillion under Obama’s budget. (Thanks, Mr. President!)
“Spread that deficit over all the households in Club 250K and you have to jack up their taxes by an average of $500,000. Which you simply can’t do, since a lot of them don’t have $500,000 in income to seize: Most of them are making $250,000 to $450,000 and paying about half in taxes already. You can squeeze that goose all day, but that’s not going to make it push out a golden egg.”
“Repealing all of those Bush tax cuts, for rich and middle class alike, gets you about $3 trillion — over 10 years. The deficit is running from a third to almost half that every year. (It) will not balance. (It) does not compute. … Every time you raise the threshold for eating the rich, you get a much, much smaller serving of meat on the plate – but the deficit stays the
same. The long division gets pretty ugly. You end up chasing a revenue will-o’-the-wisp.”
It’s the same on the state level in Ohio, Wisconsin, Minnesota and elsewhere.
Increasing taxes on a shrinking private sector will not get the state the $8 billion it needs. The better strategy, as Gov. Kasich is proposing, is a mixture of spending cuts and business incentives that will expand the tax base through job creation and a better economy.
We know from history that both the Kennedy tax cuts and the Reagan tax cuts increased tax revenues. With the Kennedy cuts, tax revenues increased 62 percent, from $94 billion in 1961 to $153 billion in 1968. The Reagan tax cuts increased tax revenues by 99 percent during the 1980s over a seven-year period.
As Mr. Williamson said: “Just as supply-siders are naïve to think that tax cuts are going to magically empower us to grow our way out of this mess, progressives are naïve to think that there is some magically delicious pot of Lucky Charms at the end of the IRS rainbow that is going to get us out of this in some kind of obvious or straightforward fashion.”
While our friend Jim Surber opines on Page 5 this week against the Badger and Buckeye tack, he doesn’t offer much in the way of balancing the budget.
True, as Jim says, elections do have consequences. But we shouldn’t leap to the conclusion that the respective governors of Wisconsin and Ohio aren’t doing what the voters elected them to do.
Four years ago, Ohio elected a Democrat governor in Ted Strickland whose entire career has been as a champion of government spending – including that as a strong supporter of the largest tax increase in U.S. history, Clinton’s infamous retroactive tax hike of 1993. (And, please, do not even think of referencing the mythical “balanced budget” of the Clinton era. It never happened.)
In Strickland’s four years as governor, Ohio’s jobless rate doubled and the deficit swelled to $8 billion or more. Sure, we can blame Taft or Voinovich or even Gov. Foraker. But that will not move the state forward.
We know the Strickland approach failed. Time will tell if Gov. Kasich’s way is any better, but it is off to an encouraging start.
Rory Ryan is publisher and editor of The Highland County Press.[[In-content Ad]]