Filed under: Capitalism, Conservatism, Economy, Freedom, Politics, Taxes | Tags: High Taxes High Regulation, Public Policy Matters, Tipping Points
Capital will go where it is wanted and stay where it is well treated.
It will flee from manipulation or onerous regulation of its value
or use and no government power can restrain it for long.
Walter Wriston: The Twilight of Sovereignty
Americans move with their feet, and they also move and vote with their dollars, their work and their businesses. Between 2000 and 2010, New York has lost $45.6 billion in income to other states as workers have moved out. No other state has lost as much. It came in dead last, 50th out of 50 states.
Next in line at 49th, is California which lost $20.4 billion over the same period. 48th is Illinois, with a $20.4 billion loss, then New Jersey $15.5 billion, and completing the top five is Ohio at $14.7 billion. What do these five states have in common? High taxes and excessive regulation. This should not be a surprise to anyone.
Where did the money go? Mostly to Florida. $67.3 billion has been added to the Florida economy. Second is Arizona at $17.7 billion, then Texas is third as $17.6 billion, then North Carolina $16.2 billion and Nevada at $11.2 billion.
Public policy matters. People will go where they are well treated, and they’ll take their money with them. Those who think that if you need more money you can just raise taxes — need to recognize that there are always consequences.
Filed under: Capitalism, Economy, Education, Politics, Progressivism, The United States | Tags: More Spending, Public Sector v. Private Sector, Tipping Points
In his press conference today, and in his hasty return to a microphone to “clear up” his previous comment that “the private sector is just fine,” the president added that state governments were not hiring enough (enraging more than a few governors) and Congress needed to help them hire more firefighters and policemen. He also suggested that “austerity” causes unemployment. And yes, he does believe that more spending creates jobs. That is the problem.
This demonstrates, once again, that the president does not understand that public sector jobs do not really count in helping an economy to recover. Jobs in the federal government are paid for with taxes on the public.There is no “government money,” there is only money extracted from the people. Private sector money pays for new things, a new hamburger made or a new car, a new service performed, a new idea sold, or a newly cleaned suit.
Most states have to balance their budgets. They cannot, by law, run a deficit. If a state must cut back on the number of firefighters in order to balance their budget, it is not up to the federal government to contradict them and send money to pay for workers that the state cannot afford to support.
The business cycle gets out of whack when things are good, and expectations get a little ahead of themselves. Managers give big raises, hire a few more people, embark on ill-advised expansion, and expect things to keep getting better. Somewhere in all that enthusiasm there is a tipping point.
The tipping point that sent us into the current recession was a huge bubble in real estate, fed largely by government’s desire to get more Americans into their own homes. The legislation that enabled people who could not, under prudent rules of banking, afford the loans they were offered, also enabled people to play at “flipping homes” in hot real-estate markets. Enthusiasm for all the money to be made in turning bundles of mortgages into securities compounded the problem.
A few years ago, wild enthusiasm for doing business on the internet led to the .com bubble. The ideas for founding new businesses blossomed into the highly improbable, which did prove to be improbable. There is clearly a growing bubble in higher education — a college education costs too much, student loans become excessive, faculty salaries are too expensive, professors don’t carry a full schedule, not every campus needs full country club amenities, and too much coursework is frivolous. There are no jobs for many graduates.
We will continue to have bubbles. “All things in moderation” is a familiar trope, but as we are human, mostly ignored. As in the obvious case of Wisconsin’s recall election — common sense and basic math should prevent some of the worst errors.
Filed under: Capitalism, Economy, Energy, Freedom, Health Care, Politics | Tags: A Gloomy Outlook, American Resilience, Tipping Points
Pessimism reigns. All is gloom. The jobs picture has not improved. President Obama has been at the G-20 meeting in Cannes peddling advice that was not well received, and blaming Congressional Republicans from abroad, which is beyond tacky. The various Occupy protests grow increasingly violent as their police blotter lengthens, and public disgust with the movement grows.
President Obama has embraced the Occupy movement’s war on “the 1%” as right in line with his beliefs. Unfortunately now it’s his albatross. ACORN has sponsored OWS and is now frantically burning papers and erasing hard drives to deny their association with the protests. George Soros has been a major supporter, and the Unions have been actively supportive with both money and thugs. Unprepared cities are now having to face up to the problems caused by their earlier hands-off tolerance, and are learning a lesson.
Arab Spring seems to be a Muslim Brotherhood event, rather than a blooming of any kind of democracy. Israel is under increasing threat as the administration continues in its misunderstanding of “the peace process.” Anti-Semitism has been a feature of many of the OWS protests, including occupying an Israeli consulate. Iran continues working on their bomb. The president’s efforts are spent in campaigning, even when there is not a campaign event, and the election is a whole year from today. There just doesn’t seem to be good news out there.
There are, however, signs of change in the air. Green dreams are meeting harsh financial reality, not only here, but across Europe as well. Once they’ve started looking, European countries are discovering bountiful shale deposits. Russia and Iran were counting on gas pipelines as a subtle weapon to hold over Europe’s economy. But the new deposits can supply plenty of natural gas without fear of Russia shutting off the tap. The Greens are trying to claim that “fracking” is dangerous, but that won’t fly since it is merely a combination of two well-tested technologies.
The Mediterranean, in the wake of Israel’s discoveries, has become the new hot area for the search for oil and natural gas. Britain, faced with skyrocketing energy bills and large sectors of the population faced with energy poverty, is coming to her senses, and ending support for wind farms.
Americans may have a degree of tolerance for young idealists, and even some drums, but that does not extend to old-line communists, anarchists, and those who can’t get over their long ago hippie days. If governments cannot keep order, the people get rid of the governments.
ObamaCare does not fully take over until 2014, but the bits that have taken effect are breaking down. The Long Term Care portion of Medicare has been discarded or is about to be discarded because it cannot work. A new poll shows that less than 20% of doctors would want their children to go into medicine. Sixty percent of doctors say they are now considering retiring or quitting active care. A majority (54.2%) say they are likely to stop accepting Medicaid patients — just when the government has tried to get the uninsured 45% of the population on Medicaid.
Obama’s investment in Fisker Motors has the sexy Fisker Karma ($100,000 ea.) creating jobs in Finland, and here at home, Chevy Volts plugged in to home charging stations are catching fire. They don’t seem to know yet if it’s the charging station or the car at fault. But there goes $40,000 down the tube, if the garage doesn’t go too.
The Obama administration has turned down a Congressional subpoena to produce the details of the Solyndra scandal. Congress is also pressing for details on the Fast and Furious scandal where the federal government forced gun dealers to sell weapons to Mexican cartels, and managed to get 200 people killed. Tipping point. There’s too much evidence of gangster government out there, and it’s too late for cover-ups.
These things seem like more bad news, but they are, instead, signs of change. Tipping points, coming up. Americans have a world-class talent for muddling through. When the silly OWS kids made their plaintive, whiny signs — ordinary Americans made their own, making fun of the so-called 99%. When your protests becomes a source of satire and humor, it’s essentially over. When all the Medicaid patients signed up for ObamaCare cannot find a physician, it’s over. When more jobs are created in China and Finland than in America — Obama’s vaunted jobs program is over. When people are dying of cold because their government fell in love with unworkable windmills — that’s over too.
So it’s a glass half-empty or half-full kind of thing. It all depends on how you look at it. Pessimism can drag you down or act as an agent of change — a tipping point — that is a harbinger of better things to come. .