Raising Tobacco Taxes is Dumb

Isn’t it interesting how every time a state government is in fiscal trouble that the first thing they decide to do is to raise taxes on the sale of tobacco?  Somehow, legislators have it in their heads that the only people who might be upset by raising the cost of tobacco are smokers.  And, since smoking is bad for smokers, and smokers shouldn’t be smoking anyway, maybe making smokes more expensive will dissuade smokers from smoking.

Of course, this is government we’re talking about.  So it never works out they way they think it will, no matter who tries to tell them.  In fact, this plan to raise revenue from tobacco taxes doesn’t actually work at all.

See, governments don’t understand free markets.  If you raise the price of a certain good or service beyond a certain point, people who want the product badly enough will find a way to procure it more cheaply.  Remember Prohibition? Same thing.  To avoid paying the higher taxes, they will cross state lines, buy from an Indian reservation, buy over the internet, or even resort to black market purchasing.

And, if raising taxes does actually cut down the number of smokers, then the expected revenue from this tax increase will be less than expected…because there will be fewer smokers!

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Tags: anti-tobacco advertising, black market cigarettes, excise taxes, indian reservations, on line cigarettes
Posted Mar 11th 2010 at 10:51 am in Culture, Politics, State Politics, Tax Reform | 86206103 Commentshttp://biggovernment.com/lmeyers/2010/03/11/raising-tobacco-taxes-is-dumb/Raising+Tobacco+Taxes+is+Dumb2010-03-11+18%3A51%3A43Lawrence+Meyers

Real World Evidence for the Laffer Curve, even from the Government of Washington, DC

President Obama is proposing a series of major tax increases. His budget envisions higher tax rates on personal income, increased double taxation of dividends and capital gains, and a big increase in the death tax. His health care plan includes significant tax hikes, including the imposition of the Medicare payroll tax on capital income – thus exacerbating the tax code’s bias against saving and investment. It is unclear why the White House is pursuing these punitive policies. The President said during the 2008 campaign that he favored soak-the-rich taxes even if they did not raise revenue, but his budget predicts the proposals will raise lots of additional money.

Because of Laffer Curve reasons, it is highly unlikely that all of this additional revenue will materialize if the President’s budget is approved. The core insight of the Laffer Curve is not that all tax increases lose money and that all tax cuts raise revenues. That only happens in rare circumstances. Instead, the Laffer Curve simply reveals that higher tax rates will lead to less taxable income (or that lower tax rates will lead to more taxable income) and that it is an empirical matter to figure out the degree to which the change in tax revenue resulting from the shift in the tax rate is offset by the change in tax revenue caused by the shift in the other direction for taxable income. This should be an uncontroversial proposition, and was explained in the video from this post. But since many comments and emails expressed disbelief, this video looks at the real world evidence.

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Tags: Art Laffer, Evidence, Income tax, IRS, Laffer
Posted Mar 5th 2010 at 4:21 pm in Congress, Economics, Obama, Tax Reform, Uncategorized | 85146115 Commentshttp://biggovernment.com/dmitchell/2010/03/05/real-world-evidence-for-the-laffer-curve-even-from-the-government-of-washington-dc/Real+World+Evidence+for+the+Laffer+Curve%2C+even+from+the+Government+of+Washington%2C+DC2010-03-06+00%3A21%3A35Dan+Mitchell

The Fox Butterfield Effect and the Laffer Curve

A former reporter for the New York Times, Fox Butterfield, became a bit of a laughingstock in the 1990s for publishing a series of articles addressing the supposed quandary of how crime rates could be falling during periods when prison populations were expanding. A number of critics sarcastically explained that crimes rates were falling because bad guys were behind bars and invented the term “Butterfield Effect” to describe the failure of leftists to put 2 + 2 together.

We now have a version of the Butterfield Effect in tax policy. Recent IRS data show that rich people earned a record amount of income in 2007 and also faced their lowest effective tax rate in almost two decades. Proponents of soak-the-rich tax policy complain about these developments, but they seem oblivious to the Laffer Curve insight that rich people earned more income in part because tax rates were lower. This video explains how the Laffer Curve works.

Liberals don’t understand that if they penalize the rich with higher tax rates, as President Obama is proposing, they will be disappointed to discover that they collect considerably less revenue than predicted for the simple reason that wealthy taxpayers will respond by earning less taxable income. This Bloomberg excerpt is a good example. The leftist quoted in the article assumes that income is a fixed variable and successful taxpayers will passively endure higher taxes.

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Tags: Art Laffer, Capital Gains, Corporate Income tax, Dividends, Income tax
Posted Mar 1st 2010 at 10:59 am in Congress, Economics, News, Obama, Politics, Tax Reform, Uncategorized | 8242265 Commentshttp://biggovernment.com/dmitchell/2010/03/01/the-fox-butterfield-effect-and-the-laffer-curve/The+Fox+Butterfield+Effect+and+the+Laffer+Curve2010-03-01+18%3A59%3A17Dan+Mitchell

It Is Time For a New Tax Revolt

We will never control our government until we control the federal tax system.

It is corrupted and unfair and feeds unchecked government growth. It has made the federal government far more powerful than what was supposed to be its equal—our state governments. The income tax hides the cost of the government from plain sight and provides endless amounts of our money for the advancement of politician’s personal ambitions. It is very good for those in Washington and very destructive for the rest of us.

We’re being treated as if our only value as citizens is how much more money we can be made to give up from our paychecks. When it comes to more and more spending and more and more taxes, it is a one-way conversation. I’m ready to talk back and I don’t think I’m alone. That’s why I’m calling on every patriot to join me in a tax revolt march on Washington , D.C.

I’m leading a Tea Party Patriot team in a growing on-line tax revolt which arrives in Washington , D.C. on April 15^th to merge with the huge physical rallies that are already planned for that day. It’s a new technology that allows people to choose a graphic “avatar” to digitally march on-line to Washington with hundreds of thousands of other Americans. Even the homebound, recovering veterans and the elderly can add their voice to this new American chorus.

I’m seeing a lot of people remembering that politicians are supposed to follow the will of the people—not trample it. Like Boston Harbor , this is where we again make our stand.

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Tags: april 15 rally, deficit spending, Fair Tax, federal debt, Flat Tax
Posted Mar 1st 2010 at 9:55 am in Congress, Fair Tax, Flat Tax, Politics, State Politics, Tax Reform, Tea Party, federal spending | 82226130 Commentshttp://biggovernment.com/jwurzelbacher/2010/03/01/it-is-time-for-a-new-tax-revolt/It+Is+Time+For+a+New+Tax+Revolt2010-03-01+17%3A55%3A44Joe+%26%2339%3BThe+Plumber%26%2339%3B+Wurzelbacher

Liberty and Government: An American Tipping Point

Thomas Paine said that “It is the duty of every patriot to protect his country from its government.”  He did so amidst the long shadow of a centralized government which regarded individual rights as secondary to its own.  Today, “56% of people questioned in a CNN/Opinion Research Corporation survey  . . . say they think the federal government’s become so large and powerful that it poses an immediate threat to the rights and freedoms of ordinary citizens.”  They do so in the shadow of a government seeking to take control of nearly 17% of the US economy, if not that portion of our lives, in the name of caring for our health.

For any that have cared to listen to the debates over multi-trillion dollar spending programs, tax hikes, cap and trade or health care, at issue is not simply whether those huge government programs would provide lasting solutions – they will not – at issue is our basic right to Liberty.  Quite frankly, it was never the assumption of the Founding Fathers that it was the role of government to provide a moving target standard of living for Americans.  It was their sincere hope that the government of limited powers they set up would allow people to pursue their lives, Liberty and happiness.  To do so they, wanted to hamstring government’s ability to act – not ours.

Since then, of course, the scale has tipped in favor of government power over our pursuits.  Each step along the way, those concerned with our Liberty have heard the echoes of Senator Daniel Webster when he said:

“Good intentions will always be pleaded for every assumption of authority. It is hardly too strong to say that the Constitution was made to guard the people against the dangers of good intentions. There are men in all ages who mean to govern well, but they mean to govern. They promise to be good masters, but they mean to be masters.”

As you consider his words, it may worthy to also consider the lives of Americans, at the dawn of these United States, and the lives of Americans today.

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Tags: american founders, Articles of Confederation, daniel webster, expanded government, founding fathers
Posted Mar 1st 2010 at 7:51 am in Culture, History, Local Government, Politics, Regulation, Tax Reform, Tea Party, federal spending | 8196676 Commentshttp://biggovernment.com/tdelbeccaro/2010/03/01/liberty-and-government-an-american-tipping-point/Liberty+and+Government%3A+An+American+Tipping+Point2010-03-01+15%3A51%3A32Thomas+Del+Beccaro

Why Larry Kudlow Must Run

The prospect of CNBC analyst Larry Kudlow seeking the Republican and Conservative Party nominations to oppose Sen. Chuck Schumer has become a cause among Tea Party folks, Conservatives, Republicans and many on Wall Street. Not since James L. Buckley won a US Senate seat in 1970 have New York Conservatives been so excited about a statewide political race.

Pick Up the Mantle

I don’t know Kudlow well. We met several times during the Reagan years but it was at Buffalo Congressman Jack Kemp’s 2009 memorial service that I got reacquainted with the pro-growth enthusiast. Kudlow has been on on my STONEzone TEN BESTED DRESSED LISTtm since 2008. I admire him as an unabashed apostle of hope and optimism and opportunity on television and radio. His are the politics of Ronald Reagan and Jack Kemp, who Kudlow calls his mentor.

It goes without saying that Chuck Schumer needs a vigorous challenger; he is perhaps the most odious, pushy, abrasive and self-absorbed jerk in Congress today. His pork-fests are legendary, and he narrowly escaped indictment for corruption as an Assemblyman before becoming the master of the “pay to play” game in Washington.

But Kudlow’s potential candidacy is about something even more important than sending Schumer packing.

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Tags: al d'amato, Barry Goldwater, Chuck Schumer, CNBC, Conservative Party
Posted Mar 1st 2010 at 6:14 am in Congress, Economics, History, Politics, State Politics, Tax Reform, Tea Party, federal spending | 8215081 Commentshttp://biggovernment.com/rstone/2010/03/01/why-larry-kudlow-must-run/Why+Larry+Kudlow+Must+Run2010-03-01+14%3A14%3A27Roger+Stone

Fiscal Death by Welfare

Ironically enough, the medicine applied by our state as the antidote for our ills has proven to be poison.  The welfare state is killing our nation.  Today entitlement spending makes up nearly half of our budget.  Long term, we know that there will be no way to pay off our unfunded obligations — we will go bankrupt.  There will be three options ultimately, though ultimately can come quite suddenly: default, hyperinflation or abolition of the welfare state.

Default is considered by many to be an impossible option as it would likely lead to mass chaos given the necessary suspension of many government services, not to mention the practical reality that WE are the collateral in the event of default.  To default is to be honest, and to be honest is anathema to the state.

Hyperinflation in my view is the most likely outcome given the massive increase in the money supply, which is good for politicians until it hits because it allows them to kick problems down the road and impose a stealth tax.  Currently, government is toeing the line between monetizing debt and intervening to keep its borrowing rates down, while incentivizing banks to keep money in their vaults or pump it into the stock market.

I believe that as the downturn goes on the government will blame the banks for the lack of economic growth and force them to allocate credit to chosen political entrepreneurs and other bad credit risks, leading to massive inflation in prices which they will likely blame on evil speculators and greedy price gouging companies.  Hyperinflation would allow the government to pay for the welfare state –  by writing entitlement checks in worthless dollars and lead to economic paralysis as constantly rising prices would make economic calculation and thus commerce impossible.

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Tags: CPAC, default, entitlement spending, entitlements, George Will
Posted Feb 28th 2010 at 5:01 pm in Congress, Culture, History, Politics, Tax Reform, Tea Party, federal spending | 79742129 Commentshttp://biggovernment.com/amellon/2010/02/28/fiscal-death-by-welfare/Fiscal+Death+by+Welfare2010-03-01+01%3A01%3A46Andrew+Mellon

The Mount Vernon Statement, A Poor Man’s Manifesto… Very Poor

A group made up of some of the biggest names in contemporary conservatism got together a few days ago and crafted what they are calling the “Mount Vernon Statement,” a manifesto of sorts meant to give direction to today’s conservative movement. Put succinctly, it fails to fill the bill.

Taken as a whole this statement is fine as a short history lesson. It explains pretty clearly what the founders had wrought when their basic work was done with the adoption of the U.S. Constitution. But as a statement of principles that might guide today’s discussion, I do not think the letter works.

Don’t get me wrong, I am not saying that this effort is harmful. In fact, I think every young person should read it for its explication of our historically conservative American principles. The problem is that this thing doesn’t seem to speak directly to what we are facing today like a statement that perhaps aims to become boilerplate should.

Some of those involved with the statement said that the 1960 “Sharon Statement” served as their inspiration. The Sharon Statement, intended to give some ideological umph to Goldwater conservatives, is an effort that works much better as a rallying cry to action. Sadly, the Mount Vernon Statement falls a little flat in this respect.

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Tags: alexander hamilton, Barry Goldwater, constitutional principles, George Washington, james madison
Posted Feb 23rd 2010 at 5:18 am in Congress, Culture, Economics, Education, History, Politics, Tax Reform, Tea Party, federal spending | 7865450 Commentshttp://biggovernment.com/wthuston/2010/02/23/the-mount-vernon-statement-a-poor-mans-manifesto-very-poor/The+Mount+Vernon+Statement%2C+A+Poor+Man%E2%80%99s+Manifesto%E2%80%A6+Very+Poor2010-02-23+13%3A18%3A12Warner+Todd++Huston

Political Alchemy, Part I: Turning Spending Increases into Tax Cuts

Politicians in Washington have come up with something far more impressive than turning lead into gold or water into wine. Using self-serving budget rules, they can increase the burden of government spending and say they are cutting taxes instead.

This bit of legerdemain is made possible, thanks to the convolutions of the personal income tax, by adopting or expanding refundable tax credits. But in this case, “refundable” does not mean the government is returning money to taxpayers. Instead, it means that money is being redistributed to people who do not earn enough to be subject to the income tax.

This is hardly a trivial issue. According to the Congressional Budget Office, the amount of income redistribution being laundered through the tax code is now so large that the bottom 40 percent of the population has a negative “effective” income tax rate. In simple terms (though perhaps with profound political implications), the income tax is a revenue generator for a big share of the population.

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Tags: 1040, Big Government, EITC, federal spending, Flat Tax
Posted Feb 8th 2010 at 12:57 pm in Congress, Economics, Flat Tax, News, Obama, Politics, Tax Reform, Uncategorized, federal spending | 7025055 Commentshttp://biggovernment.com/dmitchell/2010/02/08/political-alchemy-part-i-turning-spending-increases-into-tax-cuts/Political+Alchemy%2C+Part+I%3A+Turning+Spending+Increases+into+Tax+Cuts2010-02-08+20%3A57%3A34Dan+Mitchell

Obama’s Big Tax Hike on Multinationals Means Fewer American Jobs and Reduced U.S. Competitiveness

The new budget from the White House contains all sorts of land mines for taxpayers, which is not surprising considering the President wants to extract another $1.3 trillion over the next ten years.

One of the worst proposals targets American companies that compete in foreign markets. Under current law, the “foreign-source” income of multinationals is subject to tax by the IRS even though it already is subject to all applicable tax where it is earned (just as the IRS taxes foreign companies on income they earn in America). But at least companies have the ability to sometimes delay when this double taxation occurs, thanks to a policy known as deferral. The White House thinks that this income should be taxed right away, though, claiming that “…deferring U.S. tax on the income from the investment may cause U.S. businesses to shift their investments and jobs overseas, harming our domestic economy.” In reality, deferral protects American companies from being put at a competitive disadvantage when competing with companies from other nations, and therefore protects American jobs. This video has the details.

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Tags: Big Government, Competitiveness, Corporate Income tax, Corporate Taxation, Deferral
Posted Feb 4th 2010 at 8:03 am in Economics, News, Obama, Politics, Tax Reform, Uncategorized | 700224 Commentshttp://biggovernment.com/dmitchell/2010/02/04/obamas-big-tax-hike-on-multinationals-means-fewer-american-jobs-and-reduced-u-s-competitiveness/Obama%27s+Big+Tax+Hike+on+Multinationals+Means+Fewer+American+Jobs+and+Reduced+U.S.+Competitiveness2010-02-04+16%3A03%3A57Dan+Mitchell

‘Tough’ Decisions on Spending Include $2.5M on Super Bowl Ad

Where to cut the spending? Obama has told us we have to make some tough choices. Yup, it wasn’t easy, but they decided to keep in the $2.5 million for a Census ad during the Super Bowl. That’s just a part of the $132 million we will spend to tell people to fill out and mail in their census forms.

We’d get a better bang for our buck by gambling it in Vegas. No matter what Obama says about the town, at least there we would have a chance to win big.

I understand that our constitution requires a census every ten years, but it does not require we waste our money advertising for it.  You don’t turn it in – you’re not counted. Next!

Here are some of the proposed cuts listed on the White House blog as  ”tough choices” for 2011:

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Tags: Barack Obama, Big Government, Fox News, Harry Reid
Posted Feb 4th 2010 at 8:01 am in Economics, Obama, Politics, Tax Reform, federal spending | 6949447 Commentshttp://biggovernment.com/gknapp/2010/02/04/tough-decisions-on-spending-include-2-5m-on-super-bowl-ad/%27Tough%27+Decisions+on+Spending+Include+%242.5M+on+Super+Bowl+Ad2010-02-04+16%3A01%3A00Greg+Knapp

Illinois Shows Limitations of Tea Party Movement

The Tea Party folks keep getting mad at me for saying that in the end they might prove ineffective in races at levels higher than local because they aren’t organized enough. They puff up their chests proudly proclaiming that they intend to resist being organized and they claim that being organized is precisely what they are fighting against. I understand the feeling, even sympathize quite a lot, but there is a problem with this obstinacy. It means they won’t win on a statewide ballot very often. The Illinois primary just proved me correct, too.

Let’s take the race for Senate in Illinois as exhibit “A.” Of course the good old boys in the state party went with Mark Kirk, the center left candidate from a northern suburb of Chicago. He was the he-can-win candidate and the establishment choice. Not one Tea Party group, though, wants Kirk and for good reason — and I heartily concur with them, as it happens. So who was the “Tea Party candidate,” the one meant to beat out Kirk, the one backed by the newly found power of the Tea Party movement? There wasn’t one. There were three.

Sadly, the Tea Partiers in Illinois split their vote all up. Some Tea Party Groups went with Don Lowery and some went with Patrick Hughes. A few even went with John Arrington. Hughes, of course, was the only one that had even a remote chance as far as voter polls were concerned. Hughes at least registered in the polls, Lowery and Arrington barely showed up at all.

Now, I like Mr. Lowery to be sure. He is a great fellow and has some fantastic principles. I can see why Tea Party groups are attracted to him. I feel the same way about Mr. Arrington. On the other hand, the same can be said of Hughes (disclosure, I endorsed Hughes). The problem is not that one or the other Tea Party group chose the wrong candidate, it’s that they didn’t choose the same candidate. They petered away their votes by choosing three candidates allowing Mark Kirk to run away with it.

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Tags: adam andrzejewski, Americans for Prosperity, dan proft, Doug Hoffman, Freedomworks
Posted Feb 3rd 2010 at 8:17 am in News, Politics, State Politics, Tax Reform, Tea Party | 69286184 Commentshttp://biggovernment.com/wthuston/2010/02/03/illinois-shows-limitations-of-tea-party-movement/Illinois+Shows+Limitations+of+Tea+Party+Movement2010-02-03+16%3A17%3A24Warner+Todd++Huston

Geithner and Bernanke: Laundering Money Through an Illegal Trust?

This afternoon on Secure Freedom Radio we announced a breaking news story concerning the Administration’s ongoing cover-up of AIG financial wrong-doing.  In an interview with David Yerushalmi, senior litigator on the Murray v. Geithner et al lawsuit, we expose possible fraud, money-laundering and criminal activity.

As Yerushalmi says in the interview, “So here’s what we find out in the midst of discovery when we depose the Treasury Department’s deponent and the Fed and get documents, here’s what we’ve learned: The Federal Reserve Bank of New York at the time that it structured the debt that it was going to give AIG insisted that not only did it get the debt, not only would it get principal and interest payments and collateral for that, it wanted 80% of AIG, precisely 77.9% of the shares and the voting rights.  But the Federal Reserve Bank and Geithner knew that it was illegal for the Fed system whether there’s a Fed or the Federal Reserve Bank of New York to own that, so what did they do….”

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Tags: AIG, Ben Bernacke, Ben Bernanke, David Yerushalmi, Federal Reserve
Posted Feb 2nd 2010 at 5:10 pm in Congress, Economics, Tax Reform, federal spending | 68910148 Commentshttp://biggovernment.com/fgaffney/2010/02/02/geithner-and-bernanke-laundering-money-through-an-illegal-trust/Geithner+and+Bernanke%3A+Laundering+Money+Through+an+Illegal+Trust%3F2010-02-03+01%3A10%3A36Frank+Gaffney

We Need a Real Spending Freeze and Tax Cuts

Don’t you hate it when you go to a 50% off sale and then realize the store marked up all the prices in order to offer the big savings? Welcome to President Barack Obama’s spending freeze.

It’s hard to keep up with the shocking numbers under Obama. Federal spending was up 18% in his first year and the deficit was $1.4 trillion, almost three times greater than it was the previous year. That’s 9.9% of 2009’s GDP, more than three times the post World War II average. (Sorry, Barry, but you can’t blame it all on Bush. That budget was done under a Democrat House and Senate and signed by you. ) Depending on whose numbers you believe federal nondefense discretionary spending will increase another 7-10% for 2010.

The Congressional Budget Office says we’ll run at least another $1.35 trillion deficit. The average deficit for 2011-2020 will be around $600 billion per year. Even in Washington that’s a lot of money.

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Tags: Barack Obama, Big Government, federal spending
Posted Feb 1st 2010 at 8:37 am in Congress, Obama, Political Humor, Politics, Tax Reform, federal spending | 6801084 Commentshttp://biggovernment.com/gknapp/2010/02/01/we-need-a-real-spending-freeze-and-tax-cuts/We+Need+a+Real+Spending+Freeze+and+Tax+Cuts+2010-02-01+16%3A37%3A05Greg+Knapp

What Did Obama Say in his State of the Union Address?

The State of the Union Address that Barack Obama delivered last night bore little, if any, resemblance to the speech that, in my opinion, he should have delivered. The actual speech was, in fact, all too typical of the genre. It ran for an hour or more, and it consisted of an interminable laundry list of putative accomplishments and proposals. When, near the end, the President said, “I don’t quit,” I found myself thinking, “No, surely! But I very much wish you would.” In the course of an hour, I felt as if I had spent three weeks listening to the man. I very much doubt that I was alone.

Seven things stood out.

First, at no point did Barack Obama acknowledge that the promises that he made in campaigning for the so-called stimulus bill have gone unredeemed and that unemployment has continued to grow in a fashion that, he told us, it would not.

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Tags: State of the Union Address
Posted Jan 28th 2010 at 5:31 am in Congress, Economics, Environment, Healthcare, Obama, Politics, Tax Reform, federal spending | 66070242 Commentshttp://biggovernment.com/prahe/2010/01/28/what-did-obama-say-in-his-state-of-the-union-address/What+Did+Obama+Say+in+his+State+of+the+Union+Address%3F2010-01-28+13%3A31%3A39Paul+A.++Rahe

What Should Obama Say Tonight?

The State of the Union Address is ordinarily a bore. It generally consists of a laundry list of proposals, and the list nearly always seems interminable. If Barack Obama has moxie, however, tonight could be different. His State of the Union Address could be a real game changer.

Here is how he could do it – if he was really intent on saving his Presidency and on turning a disgraceful performance in that office into something worthy of eulogy. This evening, after the usual formalities, he could say.

My fellow Americans, let me begin by stating the obvious. The state of our union is not good. We seem to be – we may be – coming out of a recession. But, if so, the recovery is not only jobless; it is accompanied by an increase in unemployment.

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Tags: climategate, guantanamo, Islamic Terrorism, Newt Gingrich, Social Security
Posted Jan 27th 2010 at 2:37 pm in Congress, Defense, Economics, Education, Environment, Healthcare, Justice/Legal, Obama, Politics, Tax Reform, federal spending | 65994173 Commentshttp://biggovernment.com/prahe/2010/01/27/what-should-obama-say-tonight/What+Should+Obama+Say+Tonight%3F2010-01-27+22%3A37%3A25Paul+A.++Rahe

Explaining the Tea Party Movement and the Bewilderment of the Political Class

It is apparently a mystery to a lot political insiders why the Tea Parties have become so popular with so many Americans in state after state across the nation.

Many have simply tried to dismiss the phenomena as the ranting of a relatively small number of angry right-wing zealots. They are dead wrong but one gets the feeling the political class finds this easy dismissal far more comforting than the unsettling truths driving angry and vocal dissatisfaction by people from across the political spectrum.

“Real people” like me resonate in politics right now because of the growing chasm between what the political elites of both parties see as the best course for the nation—and for themselves– and the hopes and fears of the average American man and woman. In China that difference might mean very little to government as we saw in Tiananmen Square but, according to the Founding Fathers, such a division should not even exist here in the United States.

Those who are passionately protesting at Tea Parties and making themselves felt at the polls have rightly detected more than a hint of contempt for the average citizen. If everything were going well such elitist arrogance might be accepted, as it has been in the past. But things are not going well for our nation and more and more people are challenging the performance, ideas and motivations of those who hold themselves out as smarter and better than the rest of us.

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Tags: Christmas terror attack, DC school vouchers, Fair Tax, Hurricane Katrina, Janet Napolitano
Posted Jan 25th 2010 at 10:43 am in Congress, Culture, Featured Story, Healthcare, Obama, Politics, State Politics, Tax Reform, Tea Party, federal spending | 64930180 Commentshttp://biggovernment.com/jwurzelbacher/2010/01/25/explaining-the-tea-party-movement-and-the-bewilderment-of-the-political-class/Explaining+the+Tea+Party+Movement+and+the+Bewilderment+of+the+Political+Class2010-01-25+18%3A43%3A22Joe+%26%2339%3BThe+Plumber%26%2339%3B+Wurzelbacher

A Victory for Fiscal Sovereignty and a Long-Overdue Defeat for the IRS

A Swiss court just threw a wrench in the gears of an IRS effort to impose bad US tax law on an extraterritorial basis, ruling that UBS does not have to hand over data to the American tax authorities.

This ruling nullifies an agreement that the Swiss government was coerced into making with the US government last year. In typical arrogant fashion, the IRS already has indicated that it still expects acquiescence, notwithstanding Switzerland’s strong human rights policy on personal privacy. The Bloomberg story excerpted below has the details, but it’s worth noting that this entire fight exists solely because the internal revenue code imposes double taxation on income that is saved and invested and imposes that bad policy on economic activity outside America’s border. But just as other governments should not have the right to impose their laws on things that happen in America, the United States should not have the right to trample the sovereignty of other nations:

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Tags: Financial privacy, Human rights, IRS, Switzerland, Tax Competition
Posted Jan 23rd 2010 at 10:19 am in Economics, Justice/Legal, News, Politics, Tax Reform, federal spending | 6417088 Commentshttp://biggovernment.com/dmitchell/2010/01/23/a-victory-for-fiscal-sovereignty-and-a-long-overdue-defeat-for-the-irs/A+Victory+for+Fiscal+Sovereignty+and+a+Long-Overdue+Defeat+for+the+IRS2010-01-23+18%3A19%3A32Dan+Mitchell

Louisiana Legislature Floating Bill Making Obamacare Illegal in State

Louisiana State Senator A.G. Crowe (R, Slidell) is introducing a bill for the 2010 legislative session in Baton Rouge that would make Obamacare illegal if it violates state laws, effectively making Obamacare null and void in the Pelican State.

Senator Crowe states that his bill “provides that no law or rule shall compel, directly or indirectly, any person, employer or health care provider to participate in any health care system or health insurance.”

Crowe’s proposed Senate Bill (download .pdf file) begins as follows:

HEALTH CARE. Prohibits state or local governmental coercion of any Louisiana employer, health care provider, or individual to compel participation in any health care system or health insurance plan.

Crowe insists that Obamacare violates Article I, Section 8 of the Constitution and “is therefore unconstitutional.” He also feels that the president’s plans violates the 10th Amendment among others.

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Tags: AG Crowe, Bobby Jindal, Buddy Caldwell, Louisiana, Michael Boldin
Posted Jan 22nd 2010 at 1:07 pm in Congress, Economics, Healthcare, Obama, State Politics, Tax Reform, federal spending | 6135466 Commentshttp://biggovernment.com/wthuston/2010/01/22/louisiana-legislature-floating-bill-making-obamacare-illegal-in-state/Louisiana+Legislature+Floating+Bill+Making+Obamacare+Illegal+in+State2010-01-22+21%3A07%3A27Warner+Todd++Huston