Posts Tagged ‘Taxes’

The Thinker

Hurricane Sandy reminds us why we need government

With the arrival of Hurricane Sandy here on the east coast yesterday, you got a timely reminder of why we need government. Yesterday was a day when you wanted to batten down the hatches and if you lived in certain areas also pray like hell. Unless you own a boat or ship you probably didn’t have to literally batten down any hatches, although I have to wonder if failure to do so lead to the sinking of the HMS Bounty during the storm.

For most of us storm preparation meant cleaning out gutters, removing chairs from our decks, testing the sump pump, stocking up on batteries, toilet paper and bottled water, and finding places for our automobiles away from trees. It worked for us here in Oak Hill, Virginia. Sandy dumped more rain than wind on us. Nearby Washington Dulles International Airport reported 5.4 inches of rain during the event, with peak sustained winds of 39 miles an hour, with gusts to 54 miles an hour. We also had a day of record low pressure, something I attribute to climate change. As hurricanes go this was a bizarre one. No tropical air and foggy windows this time, but cold air fed by a cold front on the other side of the Appalachians, driving rain for more than a day, and blustery winds yesterday afternoon and evening. Our house, windows and floorboards rattled from time to time, but the power and heat stayed on and we never lost Internet.

News reports indicated that millions of others are still without power. Sandy left much of New Jersey and lower Manhattan destroyed and/or underwater. I am monitoring my hometown of Binghamton, which likely has not seen the worst of Sandy yet. The area suffered two devastating floods in 2005 and 2010. This may be yet another one for that suffering area to endure. But its impact will be softened, thanks to local, state and federal emergency managers. Thanks should also be given to President Obama, who declared areas disaster areas before the storm hit, to speed aid and supplies.

The list of people and organizations to thank are immense. There is the Federal Emergency Management Agency (FEMA), which coordinates disaster relief and works intimately with the states to stage disaster relief supplies. There is the National Weather Service and the National Hurricane Center, which effectively tracked the storm and issued the correct warnings. There is the Coast Guard, various governors, state and local emergency responders, power crews, ambulance drivers and cops on the beat.

Some of the best results were things that did not happen. My roof did not blow off or collapse. This did not happen by magic, but was the result of building codes and building inspections. In 1985 when my house was constructed, Fairfax County sent out inspectors to make sure my house was constructed to a code that would allow it to endure major storms like Sandy. In 1999 we replaced our deck and enclosed it. “Big government” building inspectors took a look at the roof of our new deck and told the contractors it was not up to code. They were forced to add additional beams to support the roof.

There is more evidence of big government across the street from my house. There a large dry pond sits awaiting events like Hurricane Sandy. It safely collects backwater then funnels it into the nearby creek in a measured manner, minimizing flood damage. Even in the event that it overfilled the dry pond, the codes required the road to be graded in a certain way to keep the water flowing gently downhill, never leaving a spot on the road for water to accumulate. Before the community was even constructed, an engineering study was ordered to make sure no part of our community was in a flood zone. Had these safeguards not been in place, it is likely that we would have experienced some storm damage last night. Possibly me and some of my neighbors would be dislocated, injured or dead. Big government could not eliminate these risks, but through a planning and an impartial inspection process it minimized these risks. One of the reasons our power never went out is because power lines are underground in our neighborhood, another outcome of big government. Doubtless it would have been cheaper to plant telephone polls instead.

Much of the wheels of government work this way. It’s the things that you don’t see and take for granted that minimize losses and deaths during these natural events. All these services cost money, but they cost less because their costs are borne generally through taxes. The cost per capita for the National Weather Service is a couple of dollars per year.

FEMA is an example of the services that Mitt Romney plans to drastically cut if he is elected president. And yet many of these services are already chronically underfunded and if anything need more funds. Moreover, the cost of funding these arguably essential areas of government are a pittance compared to the cost of entitlements and defense. At least now Romney claims says he won’t cut FEMA. But clearly you cannot balance a budget and not raise taxes if you don’t cut something. If you won’t do much to cut entitlements and keep bloating the Defense Department’s budget, these essential government services must be drastically cut.

You can say, as many conservatives do, it is better to leave it to the states to handle these things. But hurricanes do not respect state boundaries. It makes no sense for each state to have a redundant weather service when it can be done nationally. The whole point of having a United States is to ensure that if some states have to deal with disaster, we can pick up their slack by everyone contributing aid through federal taxes. We need these services because we are all in this together. These services are not nice to have; they are essential. We are bigger than the sum of our parts because we are united and federated.

Also essential is the infrastructure that makes all this possible. We need the National Science Foundation to stimulate research in national areas of interest. We need my agency, the U.S. Geological Survey, to do seismological research, biodiversity estimates and to monitor the nation’s streams and groundwater, so the National Weather Service can make flood and drought forecasts. We need the FDA to make sure our drugs are safe, agricultural inspectors to make sure our food is safe, ICE to handle illegal and legal immigrants, and the FBI to investigate intrastate crimes. Maybe if push came to shove we can do without funding Big Bird or sending probes to Mars. These costs are mere pocket change in the federal budget.

As I have noted before, taxes are the price of civilization. If this is not clear to you, then elect Republicans and watch as our highways and bridges deteriorate, our children become unable to afford college, watch our food become impure, our drugs become adulterated and see legions of poor and starving people living on the streets because no one will house them or feed them. Expect that when some future Hurricane Sandy arrives, the size of the problem will needlessly mushroom simply because we as a society have decided we have stopped caring for anyone but ourselves.

It’s your choice. I understand if your ideology tells you to vote Republican regardless, but the next Hurricane Sandy won’t care about your philosophy and you and your family may be needless victims. God gave us brains. Let’s use them.

 
The Thinker

Why is my tax rate higher than Mitt Romney’s?

Mitt Romney, the likely GOP nominee for president, is not sure but he thinks his tax rate was fifteen percent last year. We may or may not know in April when he may or may not release his tax returns for 2011. While we may or may not know his 2011 income and taxes, he seems much more reluctant to release tax returns for previous years, particularly when, you know, he was raking in the mega millions working for Bain Capital, where he made his fortune.

Mitt wants you to know his tax rate was probably fifteen percent last year because it was almost all unearned income, principally interest and dividends on his investments. This is, after all, a guy who says he knows the pain of unemployment because he is also unemployed. He says that he did have some earned income in 2011, mostly speeches, but it was “only” $374,000 dollars or so.

Poor guy. It’s a good thing he doesn’t have to live off just his earned income. Imagine his suffering! First of all, that would place him in the 33% tax bracket (35% is the maximum), which it might mean that instead of flying first class he might have to fly business class. By the way, his 33% tax rate doesn’t mean he paid 33% tax on all of that $374,000. First of all, taxable wages would be considerably less than $374,000, but he would only pay 33% on taxable income over $212,300. Income below this threshold would be taxed at a lower rate. In fact, for his first $17,000 in income, he would only pay a 10% income tax, just like me.

Unsurprisingly, my family does not come close to making $326,000 in earned income, but we are reasonably well off. Curious to see how I compared with Mitt, I pulled my 2010 income tax form. My wife and I fall into the 25% tax bracket, since our taxable income in 2010 was $104,345. Which means that Mitt Romney, whose net worth is estimated at between $190 and $250 million, is taxed at a lower rate than my wife and I. Ten percent lower, in fact.

Just for the record, I am releasing my tax returns (well, the first two pages, which is enough), which Mitt won’t do. Naturally I am obscuring some personal information, but as you can see we paid $16,589 in federal income taxes, after some substantial deductions and credits, on an adjusted gross income of $142,642.

If you want to understand why the 1% are doing so well and will continue to do well, it’s there is a nutshell. Essentially those who work are required to pay proportionally more of their income in federal taxes than those who don’t, at least if your taxable income is $17,000 or more (using 2011 tax rates). And $17,000 a year is essentially living in poverty.

Since Romney has not released his tax returns, we can only speculate about whether he is a shrewd investor or not. Most likely since he spends most of his time campaigning, he is not paying much attention to his stocks and mutual funds. It is unlikely that he is carefully moving his assets around from less productive companies to more productive ones, so that he can build wealth and presumably reward innovation in the economy. Most likely his funds stay largely the same from year to year, or he hires some smart person to manage his funds for him. In any event, regardless of how much he does or does not make on his investments, he pays just 15% income tax on that portion that is over $17,000, and none of it is earned. Presumably he is getting at least 5% interest on his portfolio, so probably this income amounts to no less than $10 million a year in interest and dividends, on which he pays no more than $1.5 million of that in federal income taxes.

Whereas I work forty or more hours a week, plus teach a class at a community college for some spare change, plus earn a couple grand with an online business I have. And my tax rate is 25% on taxable income over $69,000.

So if you have wealth you can effectively do nothing and pay less taxes as a percent of your income than someone whose source of income is likely almost completely earned and who makes more than $17,000 a year. Is America a great country, or what?

Yes, this is a great country, for those with wealth. It’s pretty clear why: because the rest of us subsidize their wealth. It’s not too surprising, if you think about it, that the wealth gap started growing almost as soon as we dropped taxes on capital gains and interest below top tax rates for income, which began during the Reagan Administration. The gap is currently twenty percent: with a top earned income tax rate of 35% vs. a top unearned income tax rate of 15%. To put it another way, unearned income is worth up to 233% more than earned income because it discounts your taxes by that much.

Supposedly this policy incentivizes capitalism. It’s proof that the fictional Gordon Gekko was right when he uttered, “Greed is good”. It certainly made him and people like Mitt Romney rich, but it’s clear that the money actually came from somewhere else. In the case of Bain Capital, it often came at the expense of shareholders in failing companies and workers who at best were asked to take a “haircut”, got stiffed on their pensions and/or found themselves out of a job. The plain facts are though that more of the costs of society are being borne by those who have a harder time paying for them. It’s not too surprising then that the wealth gap grows and more and more wage earners are falling out of the middle class. Their value has been discounted.

At a minimum, I believe that unearned income should be taxed at the same rate as earned income. This at least sets parity between these two forms of income. Most of us though intuitively understand that value added through the sweat of one’s brow should be valued more than income generated from having capital alone. All value begins with a human being making some physical change to the real world. If anything, these tax rates should be reversed and unearned income should be taxed higher than earned income.

Regardless of who wins the presidential contest this year, this inequity isn’t likely to be rectified, but it sure won’t happen if you elect Mitt Romney for president. Instead, you can expect that government for and by the wealthy will continue, and your vote for Mitt will be instrumental in ensuring that the value of your labor will continue to decline.

 
The Thinker

Calling their bluff and Obama’s trump card

The temperature hit a record 105 degrees Friday at Washington Dulles International Airport, a new record. The temperature must have been at least as hot at the White House. There President Obama and House Speaker John Boehner were engaged in their latest discussion regarding raising the nation’s debt ceiling. Apparently tempers flared, Boehner left, and the president and speaker were left to give dueling press conferences to explain why the other side was being unreasonable. Meanwhile, social security recipients were anxiously wondering if they were going to get their checks on August 3rd.

The dueling press conferences were at least instructive in underscoring the fundamental issue of disagreement. It’s not the deficit that really matters, it’s not even the debt ceiling, and it’s not jobs or the state of our economy. It’s taxes. For House Republicans, the bottom line is no taxes must be raised, not even when our deficit is more than a trillion dollars a year. Unfortunately, they have boxed themselves in by claiming that debt and the deficit were more important when all along it was really about taxes. Now, as President Obama pointed out in his press conference, they are left with the inability to say yes.

To Republicans, the deficit is less important than no new taxes. It turns out that for them taxes trump everything. It used to be that Pentagon spending was sacrosanct for Republicans: how could we possibly endanger our national security? Well, not anymore: when push comes to shove they would rather reduce our military budget than raise a dime in new taxes. The logic gets fuzzy when it comes to agriculture subsidies and the like. In their minds, taking these away without adding subsidies somewhere else is a tax hike. Thus spake Grover Norquist. But cutting Pentagon spending in general, even though there is a huge defense community that depends on federal spending, is apparently okay if it avoids a tax hike.

The debt ceiling is fungible as well. Republicans are not opposed to raising the debt ceiling, but only if there are no new taxes and “savings” by cutting expenditures exceeds the amount by which the debt ceiling is raised. It is also fine to not pay our bills, bring the economy into depression, leave grandma without her social security check and raise our long-term borrowing costs rather than raise a single dime in new taxes.

One can arguably say that Republicans are crazy, but one cannot fault them for inconsistency. They mean what they say and they say what they mean unless, and this is a very big unless, they can have a sudden change of heart or Speaker Boehner can convince enough House Democrats and non-Tea Party Republicans to go for another deal.

So far Republicans have been remarkably tone deaf to their corporate masters, who are now telling them, “Okay, enough is enough. Time to sober up and compromise now.” Too bad these same corporate masters were not working to elect establishment Republicans rather than Tea Party Republicans last year. While they achieved their desire for a majority of Republicans in the House, it came at the expense of political accommodation, hitherto a necessary skill when there is divided government.

Yet, there is a power stronger than even Grover Norquist that Republicans have foolishly ignored until now, but they will discover on or around August 3rd if the debt ceiling is not raised. It is the power of senior citizens who depend on social security but who will not get it. It is the power of sixty million angry and desperate phone calls from hot-tempered grannies and gramps who, if they are mobile, will also be picketing outside their representative’s offices. You really don’t want to rile up these folks, because they were the ones who voted you into office, but they did so on the condition that you would not mess with their junk.

Politically, letting Republicans push us into default probably would help rather than hurt the president, providing it can be shown that he did everything possible to prevent a default. Given that the Senate has already rejected the House’s plan, this has already been demonstrated. The economic effect of default would likely be catastrophic, but the political effect would be to throw the Tea Party out in 2012, and likely lead to the demise of the Republican Party brand.

Still, there has to be one adult left in the room. If I were President Obama, and if push came to shove I would say that the 14th Amendment gives me the right to extend the debt ceiling unilaterally to cover all debts covered by law. I would also cross my fingers and hope that at the 11th hour that there were enough worthy creditors willing to loan us money to avoid default. I expect he has his lawyers all over the problem. That is his trump card that he will be forced to pull out only if all else fails.

 
The Thinker

So many privatization opportunities abound

Unless you live in the state of Virginia, you may have missed the news that our ubiquitous state owned ABC (Alcoholic Beverage Control) stores may be going the way of the dinosaur. Governor Bob McDonnell promised in his campaign to turn them over to the private sector. He says that the private sector would run liquor stores much more efficiently than the government. In addition, by selling more liquor these private stores would generate additional revenues to help address Virginia’s chronically under funded transportation system. This sure sounds sweet.

Yet, the governor recently ran the numbers again. Maybe turning over ABC stores to the private sector won’t be the VDOT’s salvation after all. While McDonnell swore he would not raise taxes, he did recently float the trial balloon of adding a “fee” to alcoholic beverages sold in the state. A “fee” apparently is not the same thing as a tax. This tax fee should help make up the $250 million dollars in revenues brought in across the state by these ABC stores. Wow! That’s a lot of fees!

It’s unclear to me what the advantage of turning over these ABC stores to the private sector actually is. Whether it does or does not save money seems to be beside the point. A good Republican, after all, believes that the private sector always operates more efficiently than the government. ABC stores were created after prohibition was repealed to control the hard liquor-drinking problem in the state as well as to assure that the state got its proper share of taxes on alcohol. If ABC stores are decommissioned, presumably, I could pick up a bottle of Jack Daniels at the local Shoppers Food Warehouse and save myself a trip to the state owned package store.

It strikes me that state owned package stores are just the tip of the “socialist” iceberg that enlightened Republicans could rid us of, thus giving us more freedom and keeping taxes low. Republicans in Congress, and particularly the Tea Party wing of the Republican Party, have their eyes on Social Security and Medicare. The latest groupthink seems to be that neither of these programs is sacrosanct and they can be “managed” by turning them into voucher programs. Send recipients vouchers and let them buy an annuity or old age health care with their voucher through this magic called shopping around for the best deal. If the voucher doesn’t quite cover living expenses to the same degree as the government has, well, that’s too bad but that’s better than “socialism”. At least costs are contained and thanks to the magic efficiency of the private sector, somehow people will be able to buy much more value with their vouchers than through some sort of “socialist” government-run program.

Republicans for years have been advocating for parents to use vouchers buy their way into private or charter schools instead of their local public school. Why settle for mediocre public schools, goes the thought, when some private charter school around the corner will give better results for less money? Likely, their staff would not belong to any stinking teachers’ union. This would help drive value, although it might also depress teachers’ wages.

Why stop with public schools? Why have public colleges or universities? Surely, the magic of the private sector can work its magic if they too were privatized. To a good Republican, even an institution as renown as Texas A&M should be on the chopping block. If the horror of socialism existing in our public schools can be dealt with through the magic of vouchers, surely “socialist” public colleges and universities can be run more efficiently as well if sold to the private sector. After all, tuition increases far exceed the cost of living. Something must be rotten in our public universities and competition is surely the solution.

Strangely, it doesn’t appear that private universities offer a better deal. The Washington Post, whose holding company also owns Kaplan University, calculated that students pay nearly four times as much from Kaplan for an associate’s degree in business administration as do students attending Northern Virginia Community College ($33,390 vs. $8500). It is also true that the state subsidizes NVCC and other public universities, but clearly not so much as to make up the staggering difference between NVCC and Kaplan. From all the evidence, it appears that public colleges and universities offer a much better value for students than private colleges and universities.

Clearly, NVCC is not in the business of making a profit, unlike Kaplan, whose shareholders want regular stock dividends. Kaplan may be targeting those who need more flexibility in their educational schedules and don’t mind paying extra for the privilege. Most students finance at least a portion of their education. Since our “socialist” governments seem to be in the student loan business, they are essentially funding many students’ private educations. Yet while nationwide only ten percent of college students go to private universities, 44% of student loan defaults happen to students attending private universities. Could it be that private universities care more about profits than whether their students actually graduate?

Nonetheless, public universities should be a choice target for Republicans. Why not just issue tuition vouchers for students to use where they want and privatize our public universities as well? Shouldn’t it just invigorate competition in the educational marketplace and thus drive down costs? Oddly, it just doesn’t seem to be working out that way. Private universities seem to be targeting the high-end market, not the low-end. It looks like outsourcing our public colleges and universities would only make college less affordable to those who need it the most. But when ideology is more important than facts, why be bothered? Think of all the money taxpayers could save by not maintaining those colleges, universities and public schools. Just give them a voucher if they whine and let people shop around!

If they return to power in November, there are all sorts of opportunities for Republicans to deliver on their privatization agenda. I was going to suggest that our public roads could be turned over to the private sector, but that’s already underway here in Northern Virginia, where High Occupancy Toll (HOT) lanes are being added to the Capital Beltway, ensuring that the well moneyed won’t have to deal with the inconvenience of traffic. VDOT can no longer be bothered to run the Dulles Toll Road, and turned it over to the local airport authority. Prisons are also being outsourced in many states; the Corrections Corporation of America apparently provides cells for many if not most Arizona prison inmates. In addition, as the Bush Administration demonstrated, war can largely be outsourced these days too. Ask Blackwater. Their stockholders did quite well in the last decade, although the value of their services looks suspect. Even the Obama Administration is getting into the outsourcing act. It wants the private sector to provide rockets to ferry astronauts into space. Curiously, most Republicans are against the idea. It’s probably because it was proposed by a Democrat.

In any event, we have just scratched the surface at innovative ways to reduce “socialism” here in America. It is true that Thomas Jefferson might roll in his grave at Monticello if his beloved public University of Virginia went private, but when it comes to ideology we must not let two hundred years of tradition and a dead president’s feelings stand in the way of innovating the private sector.

It simply has to be all for the best!

 
The Thinker

The dangers of deficit fever

Why study history? After all, many people (particularly students) find history boring. However, there are excellent reasons for studying history. By observing our actions in the past and their effect we can predict with a fair amount of confidence whether they will work again. For example, based on our experience during the Great Depression, cutting spending lead to less economic activity and prolonged the Great Depression. Lesson: the government should keep spending in ways that stimulate the economy until a recovery is sustainable.

So what are we doing as we just begin to emerge from the Great Recession? Why, we are cutting spending! With history as our example, we now know that we are almost guaranteeing a double dip recession. Moreover, what we are cutting suggests profoundly stupid choices. It appears that whenever we finally emerge from our economic doldrums and near double-digit unemployment, our status of still being a superpower will be problematical.

It is easy to look at countries like Greece, which is in the midst of a terrible deficit-driven crisis, and figure we need to buckle down ourselves. Greece is buckling down, largely because it had no choice. Here is what austerity is also bringing in Greece: a sharp and marked drop in standards of living, a rise in already high unemployment rates, and credit that is hard to get and when available only at usury rates. There is also a lot of civil strife. Students, pensioners and government employees are marching in the streets. Rioters have already killed some people and damaged considerable property. Greece is on the edge of anarchy.

However, here in the United States both our “welfare state” and our total debt as a percentage of GDP is a fraction of Greece’s. This suggests we are in no danger immediate danger from excessive debt. In fact, as financial markets now look shaky again, even more money is flowing into U.S. Treasury bills. So our country is still seen as a safe haven for money, and our debt is seen as good debt, at least compared with other investments. Unlike in Greece, only a small percentage of us retiring at fifty-five or sixty are retiring on a pension. Most of those retiring are retiring only because they lost their jobs and no one will hire them.

Having lost their jobs, they have far less money in their pocket, so they are spending less. When people spend less and earn less, governments collect less in the way of taxes. For the most part, state and local governments cannot raise taxes enough to make up the difference, so they must cut services instead. And since states and local governments have little in the way of bloat, essential services are being cut. Firefighters, police and teachers that thought they had steady jobs are finding themselves unemployed. Here is a real trickledown effect. Because they have less to spend, retailers receive less and perhaps cut their workforce, or reduce hours. When retailers sell less, they need less from wholesalers who also cut jobs. When wholesalers need less, producers and manufacturers make less so they cut jobs. So the economic effect keeps trickling down, exacerbating unemployment, reducing tax revenues and extending our economic doldrums.

Moreover, our supposedly precious children are getting inferior educations. They are stuffed into classrooms with more students, lose opportunities for extracurricular activities and in at least 120 school districts have four-day school weeks. We will depend on their income in our own retirements, but it’s hard to understand how. By teaching them less today, they will likely be behind children in other countries. All these negative effects are because we are now alarmed over short-term deficits that it appears we can comfortably sustain over the short term.

If you have trouble starting your car, you might pump the accelerator hoping the engine will start. The same is true with our economy. What you don’t do is the moment it sputters to life stop giving it gas.

Deficits remain important in the long term. However, Republicans don’t seem to understand that raising taxes is a viable way to solve deficits. If deficits are truly more important than anything else is, then raising taxes has to be on the table. Otherwise, keeping taxes low is more important than deficits, which is the philosophy they have traditionally embraced. It is also important to get spending in line with revenues. But first things first. First the economy has to be vibrant enough so that economic activity reduces unemployment and drives wealth. When this happens, tax collections also increase, reducing deficits.

Unquestionably, we waste and misdirect much of our tax dollars. Our spending on war in Afghanistan is an egregious waste of money because it is a lost cause. A lot of the money given to the Afghan government instead lines the pockets of its largely corrupt Afghan officials. It also goes to pay off warlords who look the other way so our supply trucks carry cargo safely to remote locations. Aside from the wars in Iraq and Afghanistan, huge amounts of money are wasted within the Department of Defense. Secretary of Defense Robert Gates agrees. There is also huge waste in the Medicare system. Some of these expenditures, like building aircraft engines we don’t need, do feed American families. However, but they don’t go to buy things we need to make our country stronger and safer.

It’s pretty clear what we do need to do.  We need to create jobs for the unemployed that will leave us with a stronger country. Jobs provide money, but also feed faith in the future. You don’t get there by laying off teachers, policemen and firemen. These are our first priorities, which is why it makes no sense for Republicans (and one turncoat Democrat) to kill a bill that keeps them employed. You also get there by building and rebuilding bridges and roads, funding innovative research for the 21st century and by investing in the educational needs of all our citizens, activities that are underway but where more money is likely needed. You don’t get there by cutting off unemployment benefits because people have been two years without a job. All that does is breed poverty and homelessness. However, if a chronically unemployed person at least has a check coming in, maybe he can pay his rent and buy food and clothing. That money stimulates a lot of economic activity.

You also raise taxes where it makes sense to do so. Aside from the poor economy, what is feeding the deficit? Mostly tax cuts that we gave to the richest Americans. These are people who can certainly afford to pay more taxes and in some cases genuinely want to pay more taxes. These huge tax cuts drove the problem that caused our deficits to explode. Certainly now is not the time to raise taxes on middle and lower income people, but those who can afford to pay more in taxes certainly should, particularly when richer Americans historically have paid much higher tax rates and still maintained a great standard of living.

Perhaps to achieve fiscal solvency it will be necessary to extend retirement ages or cut benefits in social programs like Medicare and Medicaid. These cuts become much more likely though in a hampered economy. I know my lifestyle would take a severe hit if I lived on half my income. The same is true with our government. A thriving economy will be the engine that creates this wealth again, as it did under Bill Clinton.

We need to spend more to get this economy moving again, even if the debt numbers look scary in the short term. Just as importantly, we need to spend wisely, investing on essentials like education, our state and local governments, and our infrastructure. Doing so prepares us for the economic challenges of the 21st century. To narrow the deficit, we need to repeal tax cuts given to the rich. At the very least, we need to redirect wasted money from places like Afghanistan into useful activities, like maintaining basic services for our citizens. What we do not need is what we have now: a panicky and foolish Congress that cannot see that their version of austerity is just another word for continued recession, unemployment and our quick descent into a second world country.

 
The Thinker

Chinese drywall: a case in point for why we need government

Does anyone like paying taxes? I doubt it. I don’t. Who would not want to give less of their hard earned money to the government? While like most Americans I don’t like paying taxes, I also understand that civilization (like freedom) is not free. So while I don’t like paying taxes, and know a lot of our tax money is wasted (something that should be addressed, of course), I prefer this to the alternative: anarchy.

During the recent snowstorms here in the Northeast, at one point I ended up with twenty-nine inches of snow on the roof of my deck. From my bedroom, I heard my deck’s support timbers creaking from time to time. I watched its roof warily and wondered if it was going to collapse under the weight of all that white stuff. Trying to shovel if off was not really an alternative, as there was no way to get a ladder into my backyard to even attempt it.

After I thought about it for a while, I recalled back to 1999 when we had the deck rebuilt and covered for the first time. I remembered how cranky the builders were when the county building inspector came over to check their work. Some of his requests seemed silly, like adding outdoor spotlights so people could come up the stairs safely in the dark. Others, it turned out, were spot on. One roof support beam every eighteen inches or so was not up to code, he told them. Double them. They grudgingly agreed, not like they had a choice. Likely because my county has competent building inspectors and modern building codes, the roof on my deck weathered a record snowfall.

I was thinking about this roof the other day when I read this article. The Consumer Products Safety Commission (CPSC) ruled that thousands of homes constructed with defective Chinese drywall must have the defective drywall gutted and replaced. In additional, the entire house’s electrical wires, fire alarms, gas pipes and even the circuit breakers must be replaced as well. The defective drywall has been linked to the corrosion of electrical wires and metal pipes, which mean that affected homeowners now also have to worry their house could catch on fire. Then there are the possible health effects including high levels of formaldehyde and sulfur dioxide that may be responsible for numerous reported cases of nose, throat and lung irritation registered by people living in these houses. Most of these houses are relatively new and include many houses that were reconstructed in the aftermath of Hurricane Katrina.

Imagine you are a homeowner with this problem. Think of the cost of gutting the entire inside of your house and rebuilding it. Think your insurance is going to cover it? My guess is, probably not. You might have some sort of home warranty that came with the house, and you might be able to use it to file a claim. Most likely, you will try to sue to recover the damages, probably by joining a class-action lawsuit. Meanwhile, you will probably cross your fingers that your house will not burn down or that you are not sent to the emergency room suffering from lung inflammation. Now that the government in finally on the case, CSPC chairman Inez Tenenbaum will be flying to China to seek redress from its government. Let’s hope the Chinese do the honorable thing.

We software engineers know that it can cost up to one hundred times as much to fix a problem after a system is delivered as it would be to get the requirement correct the first time. What software engineers know is true of most project-oriented endeavors, like building bridges or constructing houses. Clearly, had this Chinese drywall been known to have been defective it would never have been installed in U.S. homes. Maybe homeowners might have paid a little more for safe American-made drywall, but any homeowner now affected by bad drywall would certainly agree that they would rather have rather paid a little more than to have deal with the huge hassle, expense and health hazard before them.

The CPSC, like many ordinary federal agencies over the last few decades, has had reduced funding. Even the Obama Administration has given the CPSC short shrift, asking for $107 million for the agency in FY10. Congress to its credit realized this was niggardly, and partially because of another scandal (lead in toys produced in China), the CPSC’s budget for FY10 was increased to $136 million. It’s a hopeful trend, but as Consumer Reports has pointed out, the CPSC has been woefully under-funded for years. It appeared that the Bush Administration was trying to strangle it. Not surprisingly, with only 401 full time employees proposed for the agency in FY08, setting up and enforcing standards for safe drywall was on no one’s agenda.

Is government wasteful? Certainly, and there are many places where you can document huge waste and fraud, such as in fraudulent Medicare billing by many health care providers. Does that mean that government cannot provide useful and cost effective services? Absolutely not. I have no idea how much it might cost for the CPSC to create and enforce drywall standards. Let’s say it’s a million dollars a year. Even if it were ten times that much, our slightly higher taxes would more than pay for themselves in the assurance that our home are safer. The state cannot take on this responsibility. Inspecting cargo for compliance with our laws is a federal responsibility.

Perhaps in the Republican mindset, each homeowner would have their drywall independently tested by a private laboratory before having it installed or simply take their chances that they did not install defective drywall. In the real world, this is silly. This is why we have governments, because it makes no sense for every homeowner to do something like this when it can be done once by a government agency at the cost of chipping in a couple extra pennies a year in taxes. Moreover, that’s all it is. Even with a $136 million dollar budget, split among three hundred million Americans, we buy the safety we get from the CPSC for about forty-five cents per person per year. I know I would have no problem paying five dollars a year, or more, to have a lot more assurance that the products I purchase are safe. Nor would most Americans, if the argument were framed this way.

You get the government you are willing to pay for. If you are so insistent in restraining the size and cost of government, even if it means you or I may die because the government is not inspecting foreign drywall, then frankly, I think you are letting ideology override common sense. Perhaps it is time to move to Angola, where you are unencumbered by taxes. As for me, this is why I pay taxes. I am happy to pay whatever taxes are needed to ensure our products are safe. It’s crazy that so many Americans are even disputing this!

 
The Thinker

Good luck with the budget voodoo, Governor McDonnell

In case you haven’t heard, not only does Massachusetts have a new senator-elect, but Virginia has a new Governor. Bob McDonnell, your typical grey haired white Republican male with a toothy smile and a blonde arm candy wife was sworn in a week ago. He won election by promising no new taxes (a position few find hard to argue with) but also by promising all these new services. Yes, he has a four billion dollar budget hole to fill, but somehow he’s going to cut spending and add services. This includes increasing funds to the Virginia Department of Transportation, which is already decades behind where it needs to be in providing sufficient roads to handle Virginia’s burgeoning population.

Good luck with that, Governor McDonnell. Not that I am wishing you any bad luck or anything, but you are hardly the first governor, Republican or Democratic, to promise all these magical new services without raising any additional taxes. In a way, it’s an easy promise to make. After all, you don’t have to worry about reelection. Virginia governors can only serve one term.

I guess it wouldn’t work to tell voters the truth: that state services, already cut to the bone, have zero fat in them already. To close the four billion dollar gap outgoing Governor Tim Kaine outlined, most residents are going to squeal when they see what it actually means. Virginia’s total budget is around $38 billion, so $4 billion is hardly a drop in the bucket and amounts to about ten percent of the budget. I doesn’t take an accountant to figure out that if you are not going to raise taxes, you are going to add services and you already have a large projected deficit, then you are going to have to further cut services somewhere. You already promised to give more money to transportation and increase the portion of state money given to fund teacher salaries. The only problem is that both the easy and the hard cuts were made years ago.

How crazy has it gotten? The last cut to VDOT budget was $42 million from the road maintenance fund. How much is Fairfax County getting from the state for road maintenance this year? Zero dollars. That’s right, despite being the most prosperous county in the state as well as providing more tax revenue to the state than any other county as well as tons of revenue in gas taxes which is supposed to go for things like highway maintenance, we will get zero dollars for maintenance. So either we just let the potholes get bigger or we raise county taxes to pay to fix potholes which hitherto has been at least partially a state responsibility.

Now as a frequent driver, I’m all for changing this, so I think it’s great that our new governor is going to add to VDOT’s funding but I just don’t see where the money is going to come from. Education, health and human services, and transportation, in that order, are the biggest consumers of state tax dollars. It doesn’t look like education will be cut, unless it is subsidies to state universities, which have already been dramatically reduced and have students howling over their tuition rate increases. You say that transportation will get more funding which leaves human services as a likely place to use your budget knife. These services of course have already been pared to the bone. It’s hard to see how you reduce spending more there. It’s not like Medicaid is optional. It’s a nice gesture that you and your senior staff are going to be taking pay cuts, but that’s all it is and will do almost nothing to address a four billion dollar shortfall.

As best I can tell, you are pinning your hopes on two scenarios. One: the overall economy will improve to the point where more tax revenues come in. I would not take that one to the bank at least for a year or two. The other is your hope to sell oil leases off Virginia’s coast in 2011 and using some of that money to fund the state budget. I’d say the odds are pretty long there too. First, you have to get the federal government to agree to do this. Second, you have to hope that oil companies will be willing to front the money. Lastly, you are assuming that environmentalists won’t tangle this up in the courts for years.

So good luck governor but as Virginia is not licensed to print money, it’s pretty easy to see what’s going to give. Since you promised not to raise any taxes, it likely means that our overstretched state services are going to be more overstretched, which is to say the state will have to stop doing stuff that states typically do and we’re already pretty much giving up on road maintenance. I think it is much more likely that you will find reason to consolidate prisons and let non-violent prisoners out early in an attempt to make your budget math work. You just have to hope Virginia voters do not notice. As costly as prisons are, you still won’t be able to cough up four billion dollars in savings from them.

One promise I can make is that when you leave office in four years we will be lucky if our transportation funding is where it is now and our public school teachers do not have an extra four or five pupils in their classes. As for my fellow Virginians, shame on us for falling for these lies once again. Just once, I’d like to hear a Republican run for office promising no lower taxes and fewer services because that’s what it always means. Virginians would be well advised to buy extra heavy-duty shock absorbers for our cars. There will be many bumpy days ahead.

 
The Thinker

Suck it in, America

As you may recall, President Obama ran for office by saying that he would not raise taxes on the middle class. Recently in a town hall meeting in Shaker Heights, Ohio, he also said that he would not sign a health insurance bill if it added even one dime to our deficit over the next ten years. Presumably, paying for all these new programs cannot be done solely through taxing the rich and by ending wasteful government programs. Every president in my memory has said they will cut government waste. None of them succeeded in any meaningful way because Congress would not allow it.

Polls show public nervousness about the cost of all these new initiatives as well as our record deficit spending. This nervousness is understandable. As I noted back in 2003, civilization does not come cheap. The gap though between our needs and our resources has probably never been wider. All sorts of bills are coming due. The vast majority of Americans want health insurance reform but are also frightened by how much it costs. Granted they are also frightened about losing their health insurance. If they have health insurance, they are worried about whether they can afford to keep it.

Other bills for our Great Society are coming due. Medicare may get high marks from seniors, but it requires huge subsidies to keep it solvent. Medicaid is also costly and during this recession, its costs are more than the states can bear. This year, for the first time in its history, Social Security will give out more money than it collects. It remains solvent since it has large amounts of government securities it can cash in. Nevertheless, in twenty or so years time if nothing changes the Social Security system will be requiring subsidies just like Medicare. Then there are all those other fixed obligations, like civil service pensions for people like me, which the government may not default on as well.

Hitherto, we have been largely successful in hiding the cost of government through additional borrowing. Unlike the State of California, the federal government can print more money to pay expenses. By doing so of course, it only cheapens the value of the currency, making all our assets worth less and feeding inflation. Understandably, the Treasury prefers to borrow the money rather than create it. Our principle creditor, China, is one of many wondering if putting their foreign reserves in American dollars is still a smart thing.

To paraphrase Bilbo Baggins, the United States Government is like too little butter being spread over too much bread. Government needs to do something it doesn’t like to do: govern competently. In a perverse way, all the deficit spending we accumulated may finally force the conversation about just how big a government we actually are willing to have. The real question is this: do we raise taxes to pay for the government we want, or do we take a meat cleaver to our government instead? We are reaching the point where we will have to do one or the other. We are reaching the end of trying to borrow our way out of making hard choices.

I am sure most conservatives out there are hoping for the “liberal” use of a meat cleaver. The irony though is though that Republicans and reputed conservatives actually in government do not really want to shrink the size of government. They want it to grow. They cannot come out and actually say it but this is in effect what their votes have demonstrated over the years. Every Congressman is in favor of cutting services in other districts, but want to expand them in their district. We saw this absurdity played out last week. Conservative “Blue Dog” Democrats were trying to restrain the cost of health insurance reform, while writing in provisions to raise Medicare reimbursement rates for their own rural districts.

Barring a constitutional convention, the only way to make unpopular decisions is to come up with a mechanism where it can be done without your senator or Congressional representative taking the heat. It worked before with the Base Realignment and Closure Commission, which decided which military bases to close subject only to congressional override. Something similar has been proposed as a way to pay for health insurance reform: have a panel of experts decide what care should be paid for and what reimbursement rates are reasonable subject only to a congressional override. It’s a good idea because it recognizes the reality that when given the opportunity Congress will choose pandering to governing.

Conceptually this is a great model that should be extended to much of government. However, if you do too much of it, you wonder what is the point of having a legislature at all. Our representatives are supposed to be making hard choices instead of avoiding them.

Another possible solution would be campaign finance reform. At least this way a congressional representative would feel freer to vote their conscience rather than placate the sponsors that fund their campaigns. Attempts have been hit or miss, but more importantly, our Supreme Court as it is currently constituted seems hostile to the very idea. This means, of course, that nothing will change and those who provide large campaign contributions will receive a disproportionate share of the federal largess.

This implies, perversely, that the easiest solution for paying for the cost of government is to raise taxes. Granted the idea in general causes hives among most members of Congress. What choice do we have, really? We can either make sure our revenues meet our expenditures or we will effectively reduce the size of government through inflation. However, if we choose inflation your dollars and your investments (at least those valued in dollars) will be proportionately worth less too. Whether we like it or not, our individual wealth is intricately tied to the solvency of our federal government.

If you think of the nation like a group home where we all have a room, would you rather have it shabby with holes in the roof and termites eating at the foundation? Or would you rather it well maintained? For most of us, we would demand the latter. It would be miserable to live in a house that was largely a wreck where the paint is peeling and cockroaches skitter across the floor. We wouldn’t put up with it. Neither should we tolerate a country that is a shabby representation of its former glory.

For myself I would rather have my taxes raised. Granted, I will have less money to spend on other things, but at least some of that money will go to things that matter to me, like making sure when I need health care I can get it, or when I retire there will be enough non-inflated money in the till to pay my Social Security benefits.

I just wish we could have an honest conversation about taxes. I wish the American people would get out of its collective cognitive dissonance. We cannot have it both ways any longer. We must either raise taxes because we agree that civilization in our modern world costs more money, or we must reduce the size of government while understanding that by doing so we are really doing the equivalent of chopping off one of our limbs.

It’s time to stop whining and pay for the government we have. We need a president brave enough to tell us the truth. President Obama, I am looking at you. This is what leadership is really about.

 
The Thinker

A new inconvenient truth: we need to raise taxes

Way back in 2003, I penned this post that more than five years later still gets regular hits. (It has received eighty hits since the start of the year, according to Google Analytics.) I was very politically incorrect back then when I suggested that we are not paying enough in taxes. I still feel this way and I am sad to say that recent news articles bear me out. We are woefully behind simply maintaining the infrastructure that we have. This was tragically borne out a year ago with the catastrophic bridge collapse of the I-35W Mississippi River Bridge in Minneapolis that killed thirteen people. As a direct result of this event, federal and state money suddenly materialized to replace this bridge. The replacement bridge will cost $234 million and is scheduled for completion by Christmas.

You would think that this event might have changed the dynamics. However, as the Associated Press found, just twelve percent of our most structurally deficient high use bridges have been repaired. It would cost an estimated $140 billion to repair just the bridges that need to be repaired right now. Yet, President Bush is threatening to veto a transportation bill because it spends $1 billion more than he likes. It will not surprise you to learn that Bush’s motives are wholly ideological. He is a conservative and conservatives do not believe in raising taxes or spending money on projects not considered essential. Apparently, despite overwhelming evidence to the contrary, bridge construction is not essential to this president. Our War in Iraq though is essential, and at least some of that money is going to build new bridges for Iraqis. Apparently, bridges are essential for Iraq, but are not essential for the United States. Go figure.

I picked bridge repair as an example only because it is easy to see the consequences of inaction. In fact, our infrastructure is crumbling all around us. Here in Virginia, our state House of Delegates once again bollixed up attempts to raise transportation taxes. The result is that not just bridges that are suffering, but cars spend much time sitting in traffic and consequently unnecessarily spewing emissions. So far this year there have been three Code Red air quality days for the Washington region, and twelve Code Orange days.

Better air quality, like safe bridges, are solvable problems. Neither is solved by rocket science but by the application of money and will. Just as maintaining your car means you extend its useful life, bridge life can be extended through regular maintenance too. Instead, we would rather defer the cost of maintenance to have a little more cash in our pockets today. The result is like driving your car on a half a quart of oil. You can do it for a while, but at some point, you are looking at some very expensive consequences. It is pennywise and pound-foolish.

The anti-tax crowds, epitomized by nuts like Grover Norquist, are pennywise folk. They are convinced that all expenditures of money by governments are ultimately wasteful no matter how much they address a public need. Their philosophy though amounts to living in the moment and closing their ears when the application of their philosophy results in inconvenient news, like what happened in Minneapolis one year ago exactly on August 1, 2007. These problems do not go away by ignoring them. They simply get worse and more expensive to fix.

The irony is that if instead of aggressively cutting taxes we had prudently kept the old tax rates then we would have had the money back then to fix many of the systemic problems that are cropping up all over the place today. Our tax rates seemed quite acceptable to the American public when our president was inaugurated. We were even paying back some of our massive debt. Granted, even back in 2000 we were not quite spending what we needed to spend to address problems like deteriorating bridges. This was due in part to federal gas taxes not having changed since 1993. However, construction costs have increased during that time. The result is that there is less money available to fund projects like bridge maintenance. Rather than raise gas taxes, thus far Congress’ solution is to charge it. Hopefully only as an interim measure, the House of Representatives voted overwhelmingly to add eight billion dollars to the Highway Trust Fund by supplementing it with money from general Treasury funds. In other words, we will go into more debt to pay for it and pass its cost on to future generations.

Our fiscal crisis in many ways mirrors our blindness with the oil crisis. We buy more foreign oil because we are used to an oil-based economy and do not want to think about how hard it would be to change to something else. We know that recoverable oil is a finite resource that in general will only get pricier because it will be harder to extract. Similarly, we borrow money from creditors on the expectation that they will always be willing to lend it to us. As some overleveraged homeowners are finding out, if your liabilities exceed your assets no one is willing to loan you any money. The same can happen to the United States government. Our weak dollar, trading at record lows, suggests the time may not be that far off.

To solve the oil crisis we must realize that we cannot drill our way back to our previous lifestyle. To solve our fiscal crisis, we have to realize that we cannot indefinitely depend on our creditors unless we first show a willingness as a nation to roll up our sleeves to fix some of these problems. In short, we need to raise taxes.

Raising taxes is never convenient, particularly at a time when so many Americans are struggling. That is why my suggestion will go over like a lead balloon. That is also why if I were ever inclined to move my fantasy run for president into a real run for president, my message would fall mainly on deaf ears. Like John Anderson in 1980, I would lose spectacularly.

Still, most of us, if we stop listening to the spin and start listening to our hearts, know that we face a new inconvenient truth. The cost of not raising taxes today simply means that to fix these problems tomorrow will cost even more. So yes, for a while, those extra taxes would hurt. At some point, you sufficiently address the under-funded infrastructure problems and taxes can be eased. Nevertheless, taxes must never be eased beyond the point that we can adequately maintain the infrastructure we need to run our modern society.

Instead of running for president, all I can do is be that fly in the ointment. I am more than willing to pony up my share of additional taxes. Most likely, I would pay disproportionately more in taxes than many of you, since I have a six-figure income. I do not like paying more taxes either, but I am willing to do so. I do know that despite laughably naïve men like Grover Norquist, we are interconnected. We critically depend on our infrastructure and our social safety nets. Since like you I get great value from these things, I am not afraid to pay my share.

As was true when I wrote about it in 2003, things cost money! They cost what they cost because that is how much it costs! No ideology can change this. I expect to pay close to $200 on Monday to have a locksmith fix a bad lock, which must work with our house key. It seemed like a lot of money to me too, but that is the going rate for fixing a problem that I cannot fix by myself. I would rather pay the $200 than find that anyone could get into my house or that I could not get out when I needed to.

We have a great nation that thanks to the low tax mantra is rapidly moving from first-class status to second-class status. I think I am a patriot by coming forward to proclaim that I am willing to have my taxes raised to make sure we remain a first class nation.

 
The Thinker

Guffawing over a War Tax

It is not often that I agree with Senator Joe Lieberman. Nevertheless, with his bizarre proposal yesterday for a War on Terror Tax, I found myself in a rare moment of agreement. Yet while also nodding in agreement with the intensely odd senator from Connecticut, I was also guffawing over his utter cluelessness.

Of course, his proposal has virtually no chance of becoming law. It would not even get brought up in committee. Right now, the hardest part for his fellow senators when encountering Joe in the hallways is to avoid laughing aloud. It would be charitable to call him just a jokester, but his proposal apparently was delivered while he was completely sober. In doing so, he is demonstrated how completely out of touch he is with political reality.

Raise taxes to fund an unpopular war? It is clear that taxes will not be raised on Bush’s watch, no matter how much debt we have to incur. While a Democratic Congress might be inclined to raise taxes on the rich to fund programs for the poor and middle class, it has zero appetite for a special tax to pay for Bush’s War on Terror.

This is too bad because, looked at from a non-political perspective, there are virtues to his proposal. Democrats keep trying in vain to find a means to get our troops out of Iraq. In the Senate, even holding a formal debate a non-binding bipartisan resolution expressing concerns about Bush’s planned “surge” of troops in Iraq became politically impossible. A war tax though, if it could be signed into law, would definitely end our involvement in Iraq for good. However, it would also end the Democratic Party’s control of Congress and send any senator foolish enough to vote for a War Tax into permanent retirement. That is why those senators who understand political reality will not touch it with a ten-foot pole.

What is strange is that it appears that Senator Lieberman actually thinks Americans could be persuaded to support a war tax. Exactly the opposite would happen. It would infuriate the American people. They might ignore it for a while, but they could not ignore it when it came time to file their taxes. Imagine Joe Taxpayer’s reaction when their annual income tax refund suddenly disappeared to pay for a war instead.

Bush may appear to be stupid, but he was at least smart enough to put Karl Rove on this staff. While Rove’s batting average has been off lately, in 2001 he was astute enough to realize that the War on Terror could be used to ensure a Republican grip on power. It could be done by substituting knee-jerk flag waving for genuine sacrifice. The War on Terror became a No Sacrifices War, except for those who felt called to serve their country. Bush hopes that economic growth that will fund the War on Terror.

In reality, it is foreign creditors with piles of cash burning a hole in their pockets that are funding this war. After all, you cannot make any interest stuffing all that dough in a mattress. Thank goodness for the U.S. Treasury. Its appetite for debt appears to be insatiable.

It is ironic that cash rich nations like China are funding the War on Terror. In helping us fund a lost cause, China is in effect helping itself. China is our nation’s second biggest creditor. As of last November, it held $346 billion dollars of our debt, more than any other country except Japan. Put another way, every American currently owes $1153 to the People’s Republic of China, and the amount continues to grow. If we need to go to War with China, who will fund it? I think we can rule out the Chinese.

Here is a bulletin for Senator Lieberman: the public is simply not vested in the War on Terror. Yes, we cared about it immediately after 9/11. Moreover, we were still scared a year later, when Bush erroneously told us to invade Iraq because Saddam was “grave and gathering danger” we could no longer ignore. However, the War on Terror is so five years ago. Now we simply give it lip service. We were told to fight the enemy by spending money as if the War on Terror never occurred. So we did. As in the War on Drugs, the War on Terror has been outsourced and abstracted. We have been trained to be complacent and to assume Big Brother had it all under control. Now that we realize Big Brother bungled it beyond redemption we simply want it to go away. Poll after poll indicates that is why the Democrats swept Congress last year.

Add a war tax though, and watch the public go ballistic. This tax would make an abstract War on Terror suddenly a very personal War on My Pocketbook. Since most of us are barely keeping even with inflation, a war tax would have the direct effect of decreasing our standard of living. In other words, it would hurt.

That is when, instead of getting tens of thousands to an antiwar demonstration in DC, protestors would be marching in the millions. The din would be so loud and so insistent that even the most pro-war Congressman would realize on what side their bread is buttered. Burned once, simply getting rid of the war tax would not do. Protestors would insist that Congress get out of Iraq altogether. No war, no war tax. It is that simple. Only Joe Lieberman would cast a dissenting vote.

So Senator Lieberman’s interesting idea, in the final analysis, simply shows how dramatically out of touch he is with the American people. As a fiscal conservative, if we must have a War on Terror then I would much rather pay for it up front than put it on plastic. I remain convinced that terrorism is a serious problem and needs to be addressed more effectively. Nevertheless, like most of the American public, I too have figured out that our war in Iraq is futile and ruinously expensive. We just need to get out.

If it takes a War on Terror tax to do the trick, I will be writing my Congressman.

 

Switch to our mobile site