American Elephants


Overregulation Costs Manufacturers Over $2 Trillion a Year! by The Elephant's Child

American business has been telling the federal government regularly that they are overdoing the regulation, and it is damaging the economy. The federal government yawns and says uh huh. Obama’s attitude seems to be that is what business does — complain about regulation — pay no attention to them — it isn’t important.

Now the National Association of Manufacturers has stated firmly that manufacturers are the backbone of our nation’s economy and employ more than 12 million men and women who make things in this country. To maintain manufacturing momentum and encourage hiring, the United States needs government policies more in tune with the realities of global competition.  Our regulatory system produces unnecessarily costly rules, duplicative mandates, impediments to innovation and barriers to our international competitiveness.

That’s straightforward talk from Jay Timmons, president and CEO of the National Association of Manufacturers. So they put their money where their mouth is, and produced a new report that shows the macroeconomic impact of federal regulations.

The burden of regulation falls most heavily on small manufacturers who employ less than 50 employees— at $34,671 per employee, per year. The burden on medium size manufacturers who employ 50 to 99 employees — $18,243 per employee per year, and  for large manufacturers who employ more than 100—the cost per employee is $13,750 per employee per year. The total cost of federal regulations in 2012 was $2.028 trillion (in 2014 dollars). The annual cost burden for an average U.S. firm is $233,182 or 21 percent of the average payroll. Eighty-eight percent of those surveyed said that federal regulations are a top challenge for their firm.

Everybody has talked about “the worst recovery since World War II,” but the White House seems to have no understanding at all of why it is so slow. They have kept pumping money into the economy, giving out more benefits, and that money is supposed to circulate and multiply as it passes from hand to hand. Nancy Pelosi was quite certain that unemployment benefits paved the way to recovery all by themselves.

Democrats don’t much like manufacturing or businesses who expect to earn profits from their activity. They have always regarded profit as a bit of a dirty word, money only earned by greed. Because business is greedy, it needs a firm hand and careful regulation. That’s why they have such a hard time trying to figure out how to create more jobs (infrastructure!) and jump-starting a growing economy.

Well, it matters what kind of business it is. If it is building wind farms and making solar panels, it is good. If it’s making guitars that are hugely popular with rock stars, you had better not be using any endangered wood for the frets. Your stock will be confiscated by the SWAT team that will arrive to shut down your business. (Enter Gibson Guitars in the search function just above Bob Hope’s head in the sidebar).

The business of regulation is handed off by Congress to various agencies, and the agencies’ underlying business is to assure their own continuing employment at high government salaries — so they are careful and thorough in devising regulation and oversight of the regulation, and continued monitoring of each business involved.

That in turn means forms and paperwork and legal requirements, which means that each business has to hire an extra bunch of people to comply with the paperwork requirements. The biggest cost of regulation is the full-time equivalents hired to do the paperwork. And it is serious business. Most of the agencies now have their own SWAT teams to burst into your business and make sure that you are really complying. So it really isn’t funny when the first lady decides that restaurants should show the calorie counts of each ingredient on their establishment’s signage and menus in the interest of reducing obesity.

That’s just the regulation. The tax system for American business has increased the burden to such an extent that we have moved down to 32nd in the ranking of heaviest burden on business and loss of competitiveness.  Obama thinks he is taxing rich CEOs and greedy businesses, but it is the workers who bear the burden of high taxes. We are chasing capitol out of the country to go where it is more welcome and will be better treated. Democrats call this “tax inversion” and are trying to devise laws to keep companies from moving. (Economic Patriotism!) They could just lower the taxes, which would bring in more income)

Economies don’t grow because of nice nonprofit organizations that care about people. They grow because of hardworking businesses who turn a profit and are able to hire and grow and expand.  It’s called Capitalism, which has made America the most prosperous and innovative country in the world. Prosperity is created by free markets and free people, not by the heavy hand of government.



An Out-of-Control Agency of Zealots, Destroying Your Freedom. by The Elephant's Child

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You have undoubtedly seen this picture before. I haul it out every time I write about the EPA and the agencies’ effort to transform the words of the Clean Water Act which give the EPA authority over the “navigable waters of the United States of America.”

It is partly Congress’ fault. They have chosen to write bills in general form, and leave the intricacies to federal agencies to work out and regulate. This has led to the growth of government, the growth of agencies, the growth of unionization of federal agencies, bad regulation and bad law.

Undoubtedly the Congress didn’t know how to define “clean water” in a specific and legal way—in which case they had no business making such a law.

In 2006, a US.Supreme Court Case from Michigan produced five different opinions and no clear definition of which waterways were covered and which were not. This left the government with a clean slate on which to write it’s own interpretation —everything they wanted to regulate. They are zealots and want to control everything.

I wrote about this problem in May of 2011, when the EPA was suspending 79 surface mining permits in West Virginia, Kentucky, Ohio and Tennessee because they could possibly violate the Clean Water Act. They revoked the coal mining permit for Arch Coal’s Spruce Mine No.1, a permit that had been in force for 4 years and obeyed in every comma and dot.  Arch Coal provides 16% of America’s coal and have invested $250 million in the operation which would have employed 215 miners and 300 support jobs.  The President has expressed his desire to bankrupt the coal industry.

I wrote about it again in  June of 2012 when they started trying to control the land alongside ditches, gullies and temporary water sources caused by rain or snowmelt by claiming that they are part of navigable waters. It doesn’t sound scary until you recognize that it would make it harder for private property owners to use their own land, in their backyards, to grow crops, raise livestock or even raise kids. The bill they had then had 64 co-sponsors, and John Barrasso (R-WY) said “It’s time to get EPA lawyers our of Americans’ backyards.”

October, 2013: “The Clean Water Act charged the agency with keeping the navigable waters of the United States clean. What Congress probably had in mind was shutting down any sewers emptying improperly and keeping boats from dumping oil and stopping the Cuyahoga River from catching fire. In many places the water naturally contains some methane. Not harmful to people, but it can catch fire.”

There was a big arsenic flap where some springs were found to contain arsenic in what were presumed to be dangerous quantities. The EPA made a nationwide regulation determining that every municipality would be required to treat their water to remove any trace of arsenic. Many communities had no arsenic in their water, but the agency demanded expensive water treatment anyway. In the case of safety for humans, many things that are poisonous in large quantities are perfectly safe in small quantities. The rule is always “the dose makes the poison.”

In 2013, they were going for a proposed rule—the “Water Body Connectivity Report” which removed the limiting word “navigable” from “navigable waters of the United States” and replaces it with “connectivity of streams and wetlands to downstream waters” Whoa! Change one word officially and expand your overreach by billions. Congress saw what they were trying to do and demanded answers. I don’t know how that one turned out, but it would seem to be this one.

A little over a week ago, the House passed legislation that would prevent the EPA from implementing a proposed rule to define its jurisdiction over bodies of water. EPA Administrator Gina McCarthy has said the rule does not significantly expand the agency’s existing authority. Uh huh. Republicans said the rule would go too far and subject trivial bodies of water to federal regulation.

You see how slow the legislative process is. The Bill passed the House 263-152. Vulnerable Democrats broke with their party and signed on. Before final passage the House rejected 179-240 an amendment offered by Rep. Tim Bishop (D-NY) that would prevent enactment if implementation would harm water quality. The White House issued a veto threat, saying it “would derail current efforts to clarify the scope of the Clean Water Act, hamstring future regulatory efforts, and create significant ambiguity regarding existing regulations and guidance.”

Harry Reid would be unlikely to bring the bill to a vote. You have heard much about a “Do Nothing Congress,” which is a Democrat slander. The Republican House of Representatives has passed over 297 bills, a fairly standard number for a session. The Do Nothing Democrat-led Senate has passed just 59 bills— the fewest number of any Senate session since 1972. So the next time the President claims the Republicans aren’t doing anything, which he does with some regularity — he’s just doing politics again. Harry Reid tries to avoid bringing anything to a vote that the president would have to veto.

If you attend a town hall meeting with one of your representatives, you might let them know you’re concerned. Or give them a phone call. Those probably get tallied. I suspect emails just vanish into the ether. They really don’t want to hear from you.



What If You Have A Party and Nobody Comes? by The Elephant's Child

World leaders are expected to meet as at the United Nations Climate Summit on September 21 to announce plans for reducing carbon emissions. Unfortunately, world leaders are staying home. It’s turning into a bit of an embarrassment for President Obama and UN Secretary General Bank Ki-Moon.

Australian Prime Minister Tony Abbott can’t make it because he has a country to run. Chinese President XI Jinping and new Indian Prime Minister Narendra Modi have also indicated they won’t attend. Canadian Prime Minister Stephen Harper will not be attending. And even Angela Merkel, President of very, very green Germany just can’t make it.

Well, some people do pay attention to the news. The Antarctic ice is at the greatest extent ever measured. Arctic ice is expansive and growing. There has been no warming at all, none, for seventeen years and eleven months. We’ve had snow in September in the northern Midwest and New England. The amount of carbon dioxide in the atmosphere continues to grow—which supposedly means that world climate is getting warmer—but the climate is not getting warmer, but cooler.  So possibly the increase in the benign gas that we exhale each time we breathe, the one that is a natural fertilizer for plants, is not the cause of the 1º of warming that occurred over the last hundred years? Well, yes. Exactly.

The sun, which does have a lot to do with climate, has gone quiet, and all the vast dollars and crony capitalism that have gone into finding an alternative source of energy in solar and wind energy has been for naught? Yep.

“There is essentially zero evidence that carbon dioxide from human activities is causing catastrophic climate change:” Australian geologist Dr. Bob Carter.

Climatologist Dr. Judith Curry warns of decades of possible global cooling: Suggests the “current cool phase will continue until the 2030s.”

Leonardo DiCaprio: “How we respond to the climate crisis in the coming years will likely determine the fate of humanity and our planet.”

Nancy  Pelosi: “Republicans winning the Senate would be the end of civilization.”

Activist green groups are drumming up a way to use the federal courts to force Americans to drastically reduce their energy consumption whether or not Obama signs a new climate change treaty in Paris next year.

The EPA plans to propose and finalize regulations establishing first-ever carbon dioxide (CO²) regulations for jet aircraft.

The Obama administration is reading the Clean Air Act to require a climate policy never intended or approved by Congress, and intends to negotiate an international agreement that would not survive a Senate vote on ratification.

Green organizations are planning a big climate march in conjunction with the UN Climate meeting. They are concerned about “climate justice” which seems to have nothing to do with climate (which they can’t affect anyway) and everything to do  with ‘justice” which seems to be about putting the people in charge, destroying large corporations, and redistributing income. They are particularly interested in the particular large corporations who extract energy from Mother Earth and use it to power civilization, but that is secondary to “justice.”

Emails obtained through Freedom of Information Act show that Obama’s EPA is in collusion with “green” lobby groups — the report details the conflicts of interest, “unalterably closed minds,” internal activism and influence of outside interest groups on the Obama Administration EPA. Documents raise questions about the legality of EPA rules.

The EPA also wants to garnish your wages if they accuse you of something, without any court order. How do they get that power? They just announce that they have it. That is apparently the way that some 30 government agencies have granted themselves the power to garnish your wages.  There are more problems with big government that we ever knew.



Treasury Will Pull Out All The Stops to Enforce Economic Patriotism! by The Elephant's Child

The Treasury Department could act as early as next week to stop companies from moving their headquarters out of the United States for tax purposes. “Economic Patriotism.” Where is these companies’ economic patriotism? Representative Sander Levin, ranking Democrat on the House Ways and Means Committee, which has jurisdiction over tax issues warned that “They’re preparing to act and they’ll act as soon they are ready.”

Treasury Secretary Jack Lew told Levin on Wednesday that he would not necessarily wait for Congress to go home before he would take unilateral action.  Wonder where he learned that trick?

With his brother Senator Carl Levin, (D-MI) Sander Levin has written legislation to” tighten the rules restricting so-called tax inversions, which are tax maneuvers in which U.S. businesses buy a company in a low-tax country to move their headquarters there.”

It’s the Burger King deal with Tim Horton’s Coffee Shops, and the move of their corporate headquarters to Canada, where total tax costs will be 46.4 percent lower, that has driven Democrats to start writing more confiscatory laws immediately. Burger King will continue to pay taxes on business done in the United States.

The Obama administration and Congressional Democrats have raised the alarm over possible consequences to the U.S. tax base.  Republicans  have been suggesting for some time that they should lower or eliminate the corporate tax, because the U.S. corporate tax is not only the highest in the industrial world, but the U.S. also taxes income earned abroad —which no other country does.

There is a long history going back to Martin Van Buren, of administrations that helped an economy to recover from a recession by cutting taxes. Cutting taxes allows companies more confidence in the future, and they are more apt to grow, expand, and hire — creating a better business climate— which in turn grows the economy.  Canada’s corporate tax was 43 percent in 2000, and is 26 percent today, and their economy is booming.

Democrats are fundamentally unable to grasp the idea that cutting taxes could  produce more income and make the economy grow. It simply does not compute. Treasury Secretary Jack Lew trained as a lawyer, but has simply moved through the corridors of government as a bureaucrat in one office or another. He got all huffy about the Burger King move, in a video at Bloomberg, mentioning all the advantages the U.S. provides —roads and bridges (you didn’t build that) and infrastructure!

So far as I can tell only 9 companies have actually done a tax inversion. A number have started to and backed out after being threatened.

Speaker John Boehner and Senate Finance Committee ranking member Orrin Hatch have warned that any Treasury measure that would be effective would likely lie beyond Lew’s authority.



The Boston Marathon Bombing Was Not an Act of Terrorism by The Elephant's Child

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As long as we’re talking about the careful parsing of language, according to the Boston Globe,“the Boston Marathon bombing attacks were not an “act of terrorism,” the U.S. Treasury Department has ruled, which conveniently means terrorism insurance claims need not be paid out in full.”

In the wake of the 9/11 attacks, Congress passed the Terrorism Risk Insurance Act, which created federally backed insurance in cases of damage due to terrorism. Some Boston businesses were among those that bought the insurance.

Those purchases became relevant after the Boston Marathon bombings on April 15, 2013. Of the 160 companies located near the marathon’s finish line that submitted insurance claims, just 14 percent had purchased terrorism insurance, Insurance Journal reported.

And of course Major Hassan’s massacre of his fellow service-members is still designated “workplace violence,” without the slightest acknowledgment of reality. But then that simply deprives the wounded of medical care and purple hearts, and the recognition that they were wounded in the line of duty. They probably don’t particularly care about the medal, but the benefits matter.



Democrat Attempt to End Freedom of Speech Failed. by The Elephant's Child

The Democrats attempt to rewrite the Constitution and amend the First Amendment to curtail the rights of Americans to free political speech has died in the Senate. It needed 60 votes to advance. Free political speech is the very essence of liberty, and the envy of the world.

Fifty-four Senate Democrats actually voted to give Congress the power to “regulate and set reasonable limits on the raising and spending of money by candidates and others to influence elections.” Think through what that would mean.

Some, such as Senator Bernie Sanders (S-VT) said the amendment would allow Democrats to enact more of their preferred legislation. Exactly. Democrats want to be completely in charge, without any interference from those pesky Republicans. They just want Republicans gone — so they can rule.

This bunch rejects 223 years of liberty and political freedom guaranteed by the Bill of Rights since it was ratified in 1791 — because they want their own way. No arguments. No questioning our policies. No criticism. No unpleasant speech. Can they win elections without cheating?

Somebody remarked that there used to be a “Sandinista wing” of the Democrat Party. Not anymore, it’s entirely Sandinista now.



The Difference Between Republicans and Democrats Spelled Out Clearly! by The Elephant's Child

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Here’s the difference between Democrats and Republicans —clear and simple.

President Obama has nattered on about “Economic Patriotism” and what they call “Corporate Tax Inversion.” Some corporations are finding it to their advantage to locate their headquarters in a country with significantly lower taxes. Medtronic is acquiring the Irish company Coviden and moving its corporate headquarters to Ireland.

The problem is American corporate taxes — which are the highest, at 35 percent, among the advanced economies in the world. Not only that, but the U.S. also taxes the income that American corporations earn overseas — something no other country does.

Democrats are up in arms. How dare they pick up and move? It’s not even patriotic to not pay taxes in your own country. Democrats intend to make “Economic Patriotism” a major issue in the fall campaign. (Good Democrats all hate big business).

Treasury Secretary Jack Lew, who should know better, has advocated “anti-inversion legislation.” Democrats are afraid that if a few companies do this it will open the floodgates and all sorts of American companies will locate abroad. Corporations who operate in the United States would still pay taxes on all the income earned in the U.S. but they won’t be paying double taxes to a foreign country and to the U.S. That gets very expensive, very fast.

There is, of course a very simple solution. You cut the corporate tax rate back to a rate more in line with other nations — or, gasp, even below. Yes, this is a Republican thing. Republicans like to cut taxes. The result would be a burst of activity from business, hiring, expanding, growing. The economy might even actually recover. It is how we have recovered so quickly from past recessions when Republicans are in charge.

Burger King has purchased Canada’s Tim Horton chain of coffee and donut shops, and plans to move their headquarters to Canada, where tax costs will be 46.4% lower. Canada has lowered their corporate tax rate from 43 percent in 2000 to 26 percent today. How much tax revenue did Canada lose by the dramatic reduction in their corporate tax rate? None. The lower tax rate raises more money.

For Democrats, this simply does not compute.

Secretary Lew said the corporate tax moves would mean that “all other taxpayers —including small businesses and hardworking Americans—will have to shoulder more of the responsibility of maintaining core public functions that everyone, particularly U.S. businesses, depends on.” Sigh. This man is the Secretary of the Treasury!

Lew’s remarks, delivered at an event hosted by the Tax Policy Center in Washington, came the same day Bloomberg News reported that Sen. Charles Schumer (D-NY) will soon introduce a bill that would slash the amount of interest an inverted firm can deduct from its U.S. income from 50 percent to 25 percent.
That will fix everything. Cut their deductions. Maybe they will lay off a few more people, and Obama’s recession will go on and on and on.



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