The elevation of reform of our broken monetary system to a bi-partisan economic issue may be the biggest positive development of the next two years. Just last week, two-thirds of the Delegates in the Virginia House voted to “establish a joint subcommittee to study the feasibility of a metallic-based monetary unit.” That follows the lead of the Republican Platform’s call for a commission to consider the feasibility of a metallic basis for the U.S. currency, and last year’s decision by Utah to recognize gold and silver coins minted by the U.S. government as legal tender.

Importantly, there is nothing inherently partisan about favoring a metallic-based monetary unit. George Bernard Shaw, co-founder of the London School of Economics and ardent socialist, in his 1928 book, The Intelligent Women’s Guide to Socialism and Capitalism wrote this about the gold standard:

Three years out from the official end of the last recession, the US economic growth and employment rates are virtually stagnant.  In fact, 4th quarter GDP actually declined, threatening us with the long-feared double-dip.

The Congressional Budget Office (CBO) released a report to show how Obama’s tax hikes, signed into law last month, will affect the federal government’s fiscal outlook.

Here are some highlights:

Perhaps the highest profile issue concerning the public sector was a ballot proposal in Michigan that would have enshrined collective bargaining rights for government employees into the state constitution. Many were very nervous that such a strictly binding proposal would hinder contracts in the state for years to come. The proposal failed, and the vote wasn’t all that close, with only 42% of voters supporting the proposal.

Those who would give up essential liberty for a little temporary safety deserve neither liberty nor safety. 
- Benjamin Franklin.

Next week, millions of Americans will go to the polls and vote for candidates for everything from city council to the President of the United States, and a wide variety of ballot initiatives and propositions.  As a guiding principle, I recommend liberty in deciding how to vote.

There are three key reasons to vote for liberty.

The average Newark teacher’s pay is $57,926, according to teachersalaryinfo.com. That constitutes “indentured servitude”?

When the government borrows on the scale that Washington has been doing over the past decade, it reduces the funds available for private lending and therefore the investment activities that fuel the economy. Concerned observers have raised the possibility, unless substantial deficit reduction occurs, of a long-term trend of higher interest rates and slow growth.

Democrats repeatedly claim their goal is to promote middle-class prosperity.  Yet, their policy of increased spending financed by higher taxes and rising debt are a direct threat to the middle-class standard of living and economic security.  That is the conclusion of new research I have just completed based on an analysis of state taxes, spending and debt policies and their economic consequences based on data provided by the Tax Foundation, Sales Tax Institute, U.S. Census Bureau, and the U.S. government.

States are a perfect laboratory for cutting through the political spin and observing the actual economic policies of the nation’s two major political parties, along with their consequences for the average American.  Democratic states – defined as those 18 states and District of Columbia won by the Democratic candidate for President in the 2000, 2004 and 2008 elections – are true to the Democratic Party’s rhetoric.

"Today I am pledging to cut the deficit in half by the end of my first term in office,” President Obama boldly declared on February 23, 2009. He added that this “means taking responsibility right now, this administration, for getting our spending under control.”

Among Obama’s parade of disappointments, this vehicle may be the most dangerous.

The title of the series is “Where Your School Dollars Go…” and the educrats running the show in Richmond can’t seem to come up with a straight answer for that question. Maybe that’s why government schools never seem to have enough money.

In the days following the first Presidential Debate, the spin coming from the mainstream has been that while Republican challenger Mitt Romney “won” the debate, he did so with the caveat that he was lying about how he would address the tax problem in America.

At Engage America, we’re not so much concerned with who “won” the debate, but rather what policies are part of a winning future for the country. We do, however, find it troubling when the mainstream media appears to be mitigating a one-sided debate of the issues.

This article originally appeared on The National Review Online on October 5, 2012

Slip slidin’ away . . .

Why does America seem to be slouching? Multiple measures have found this country going down, down, down since President Obama’s inauguration.

They were warned that new labor expenses might result in a credit downgrade for the financially-strapped school district, and they chose to ignore it. Now it has comes to pass. The credit rating agency Moody’s has downgraded the school district for the second time in one quarter. Moody’s wrote:

This article orginally appeared in the TaxVox blog on October 1st, 2012

If Congressional gridlock sends the U.S. government tumbling over the fiscal cliff later this year, Americans could face an average tax hike of almost $3,500 in 2013. Nearly 9 of every 10 households would pay higher taxes. Every income group would see their taxes rise by at least 3.5 percent, but high-income households would suffer the biggest hit by far, according to a new Tax Policy Center analysis.

TPC found that if the tax hikes last the entire year—a big ”if”–those in the top 0.1 percent would pay an average $633,000 more than if today’s tax rules were extended. However, even middle income households would take a hit: they’d pay an average of almost $2,000 more, and see their after-tax income fall by more than 4 percent. Such tax hikes would be “unprecedented,” said the paper’s authors, Bob Williams, Eric Toder, Donald Marron, and Hang Nguyen.

Click here to read the enitre entry on the TaxVox blog

The numbers make it clear that teachers in the financially strapped district should get no raises for at least a few years. They also make clear that costs for pensions (legally difficult or impossible to cut for current teachers without their approval) should be placed on a downward path by reducing them for new hires or requiring more employee contributions.

Truth be told, if board member Penny Pritzker’s Hyatt Hotels operated that way, they’d be out of business.  But, alas, this is government.  They strike deals with unions and figure out how taxpayers will fund it later.

“Both Governor Romney and Congressman Ryan attacked the president for allegedly robbing Medicare of $716 billion,” former president William Jefferson Clinton told the Democratic National Convention on September 5. “Here’s what really happened. There were no cuts to benefits. None . . . President Obama and the Democrats didn’t weaken Medicare. They strengthened it.”

If Clinton were under oath in Charlotte, this would be called perjury.

In what can be viewed as a desperate effort to bail out the failed economic policies of the Obama Administration, the Federal Reserve this week committed to purchasing $40 billion a month of mortgage backed securities for an unlimited time and to keep interest rates artificially low until at least mid 2015.  By so doing, the Fed has embarked upon a course that invites higher inflation, falling living standards, and a global financial crisis.

The credit agency stated that the district could improve its status if it gets spending under control and accepts a $55 million bailout from the state. It also said the rating could worsen if the school board doesn’t act quickly.

This article originally appeared on the TaxVox Tax Policy Center blog.

As politicians and their allies look for ways to finance tax rate cuts, a surprising option is getting a great deal of attention among conservatives: The tax exemption for municipal bonds.

Mitt Romney’s economic adviser Glenn Hubbard, The Wall Street Journal editorial page, and the American Enterprise Institute’s Matt Jensen are among those who in recent weeks suggested limits on tax-exempt bonds. On Aug. 13, Journal editorial writers quoted Hubbard as saying the tax benefit of munis is “on the table” as Romney searches for ways to slash tax preferences. 

And the idea is not new. For instance, the tax reform plan offered by the chairs of President Obama’s fiscal commission, Erskine Bowles and Alan Simpson, would also limit the exemption.

Cick here to continue reading the article.

As Democrats convene in Charlotte this week, they likely will double down on their claim that Bain Capital is really the Bain Crime Family. They will accuse Republican nominee Mitt Romney and Bain’s other “greedy” co-founders of stealing their profits, evading taxes, and lighting cigars with $100 bills on their yachts. But Democrats will ignore this inconvenient truth: Bain’s private-equity investments have enriched dozens of organizations and millions of individuals in the Democratic base — including some who scream most loudly for President Obama’s reelection.

Naturally, those in the educational establishment are running around as though their hair is on fire.

This article orginally appeared on the Aspen Times on Thursday, August 30, 2012

On Saturday, as Americans debated whether Lance Armstrong was a genuine hero after dropping his fight with the U.S. Anti-Doping Agency, another Armstrong — an indisputable American hero — died. Were Webster's to pair Neil Armstrong with “hero” in its dictionary, one needn't Think Again to fathom the bravery, achievement and nobility implied by the word.

For example, taxpayers may be surprised to learn they paid the pension contributions for the district and the teachers during 2010-11. So instead of just paying the district’s $49 million contribution to the State Teachers Retirement System, taxpayers took care of the teachers’ $35 million contribution, too.

Seventy-three percent say Medicare is either “extremely” or “very” important in making their choice for president. That helps to explain why you’re hearing so much about it.

The issue is especially significant because welfare reform, passed by a Republican Congress and signed by a reluctant President Clinton in 1996 as he faced re-election, is one of the main conservative policy achievements at the federal level.

Its success in moving people off dependency is not only good for welfare clients, their kids, and society as a whole, but an embarrassment to the statist philosophy and a blow to the culture of dependency this philosophy thrives on.

"When Washington confronts our crushing debt burden – and we will confront it either by choice or crisis – the solution will follow a path that is largely accepted among policymakers on both sides. Some form of comprehensive tax reform that lowers rates and broadens the tax base will accompany or precede fundamental entitlement reform. Put another way, tax reform is the policy and political bridge that will help us achieve a grand bargain and avert a European-style debt crisis.

As a matter of policy, tax reform is critical because it will help us create real growth and jobs like no other reform. Tax reform won’t just give us a tune up; it can help rebuild our economic engine for the 21st century. We waste more than $350 billion on tax compliance every year according to the Tax Foundation while another $2 trillion is sitting on the sidelines, due in part to uncertainty in the code. The last time Congress reformed the tax code was 26 years ago, which preceded the longest peacetime economic expansion in our history. Our country desperately needs that kind of growth – and revenue boost – again to help us avoid the collapse of our safety net.

As a political matter, tax reform is essential because it will build a coalition that will make a grand bargain possible. Tax reform is a form of stimulus everyone is for, but perfect tax reform won’t be enough to avert a catastrophe. We have to embrace fundamental entitlement reform: If we don’t, entitlement programs won’t exist for the next generation. That means Democrats will have to back safety net fixes that are unpopular with their base while Republicans will have to agree to revenue increases. The only way to avoid this path is for either side to run the table in the next two elections, which is a delusional expectation. Yet, in this moment, as at our founding, the path of compromise is the path of principle. Doing nothing is selling out and will lead to massive tax increases and benefit cuts for future generations."

Click here to read the entire article