On jobs, Obama giveth, and Obama taketh away

President Barack Obama speaks during a town hall meeting, Wednesday, June 30, 2010, in Racine, Wis. (AP Photo/M. Spencer Green) (ASSOCIATED PRESS)

By: Timothy P. Carney

“So those who talk about ‘this is Big Government,’ ” Vice President Biden told a crowd at a General Electric factory in Kentucky, “this is Big Government giving a little bit of help to jump-start America to lead the world in the 21st century.”

Biden was at GE’s Appliance Park in Louisville, where a raft of government subsidies (and probably some gentle urging from the White House) has spurred the multinational conglomerate to begin manufacturing hybrid electric water heaters — part of the “new foundation for a new economy,” Biden said.

But later this month, 75 miles east, workers at GE’s Kentucky Glass Plant get to see the other side of Big Government. About 175 workers there make glass, which is shipped to the Winchester Bulb Plant. Winchester Bulb is being shut down in September, and so the Lexington Glass Plant will be shuttered in late July.

GE explained in a press release last year, “A variety of energy regulations that establish lighting efficiency standards are being implemented in the U.S. and other countries, in some cases this year, and will soon make the familiar lighting products produced at the Winchester Plant obsolete.”

These were “green” regulations that then-Sen. Obama supported in the 2007 energy bill — as did GE. The company, you see, makes more profit off the more efficient compact fluorescent bulbs, because the company can charge more, but also because it makes those bulbs in China, with cheaper labor costs and fewer environmental regulations.

So, Obama and GE teamed up, pushed Big Government environmental regs and killed nearly 500 jobs in Lexington, Winchester, and another glass factory in Niles, Ohio.

But don’t worry, Obama’s got an answer for these workers, too. Obama’s Labor Department this spring declared the plant an “adversely affected employer” under the 1974 Trade Act. It’s true imports are replacing the bulbs Lexington workers used to make, but the culprit isn’t free trade — it’s the light bulb law. And the imports are GE’s compact fluorescents.

Back to Louisville, where Biden is touting the benefits of Big Government, the picture is far murkier. It’s true Congress and the administration have opened the spout of corporate welfare for GE in order to keep jobs in Louisville: $24.8 million in “advanced manufacturing tax credits” from the stimulus, plus “[u]p to $17 million in incentives from the state and metro government” according to a GE press release.

These water heater jobs are largely replacing lost refrigerator jobs, which brings us back to Big Government, although Obama bears no blame in this one. In July 2000, the U.S. Export-Import Bank, a government agency, subsidized GE’s construction of a factory complex in Celaya, Mexico. That complex makes GE refrigerators — fridges that used to be made in the United States.

To be fair, the Ex-Im subsidy exported the jobs making high-end fridges, while Appliance Park made low-end fridges. So Ex-Im helped kill GE jobs in Bloomington, Ind., rather than in Lexington.

So Big Government policies are killing GE jobs that might thrive in the free market, while creating GE jobs that never would survive in a free market. Obama is replacing unsubsidized jobs with subsidized jobs.

Biden calls this “a new economy.” Obama calls it “remaking America.” GE Chief Executive Officer Jeff Immelt calls this relationship “capitalism … reset.” Immelt wrote to shareholders days after Obama’s inauguration, “The interaction between government and business will change forever. In a reset economy, the government will be a regulator; and also an industry policy champion, a financier, and a key partner.”

This partnership of Big Business and Big Government has been good for the workers in Appliance Park. It’s also helped GE shareholders and executives. Of course, Biden and the Democrats benefit by getting to take credit for new jobs.

But will Biden be in Lexington later this month, telling workers laid off because of environmental regulations that Big Government is for their own good?

Americans have a duty to resist tyrannical government

These days, most commentary on the Declaration of Independence focuses on the implications of the passage that “all men are created equal [and] that they are endowed by their Creator with certain unalienable rights.” Dwelling on that passage might surprise Thomas Jefferson, who thought it was self-evident. The argument that flowed from his premises is more important, namely that governments derive their just powers from the consent of the governed, and when the relationship shifts to the point where government becomes a threat to the lives, liberties and pursuit of happiness of the people, it is government – not the people – that must change.

A government becomes corrupt when it abuses the power derived from the people by doing things that harm the polity and when it acts primarily as a servant of its own interests. This definition of illegitimate government has a history going back at least to Aristotle, though the 17th-century philosopher John Locke, in his “Two Treatises of Government,” gave it a form that would have been more familiar to American colonists. Beyond a certain point, when the actions of government become intolerable, the people have not only a right but a duty to reclaim their inalienable sovereignty and start over. This must be done, as Jefferson said, to “provide new Guards for their future security.”

The list of grievances in the Declaration – the part people often skip over – is critical to the argument because those grievances serve as evidence to make the case that British government had by its actions sundered the fundamental relationship between Parliament and the American colonists. Such a catalog of “abuses and usurpations” today might include: imposing confiscatory levels of overall taxation; using budget authority to transfer billions of taxpayer dollars to government insiders and pet causes; running up the national debt to a point where it is nearly equal to the nation’s total productive output; saddling current and future generations with ruinous debt to pay for pet programs that benefit the few at the expense of the many; failing to secure the nation’s borders from a flood of illegal immigrants and standing in the way of states and localities seeking to take up this fundamental duty, which the national government has chosen to ignore; and a variety of other issues ranging from a sketchy national census to crumbling national security.

The prime difference between the situation in 2010 and that of 1776 is that the people now can provide oversight through the election process. The ballot is the corrective mechanism that was unavailable to the Founders. Today’s dire situation in Washington has approached the intolerable because too few have gone to the polls to defend their rights against the predatory, permanent governing class in Congress. An electorate that fails to defend its rights deserves what it gets. Rights guarantee nothing unless they are used, and if they are not exercised, they tend to be exorcised.

After independence, Jefferson explained that the Declaration was “an expression of the American mind” intended to “give to that expression the proper tone and spirit called for by the occasion.” The result is a timeless document the spirit of which is as applicable today as it was then. The people have the means at their disposal to take back our country and the government from the disconnected oligarchy in Washington. However, this only works if Americans actually step up. To paraphrase Benjamin Franklin, the country will only be a republic if the people are strong enough to keep it.

Six Months to Go Until The Largest Tax Hikes in History

From Ryan Ellis

In just six months, the largest tax hikes in the history of America will take effect. They will hit families and small businesses in three great waves on January 1, 2011:

First Wave: Expiration of 2001 and 2003 Tax Relief

In 2001 and 2003, the GOP Congress enacted several tax cuts for investors, small business owners, and families. These will all expire on January 1, 2011:

Personal income tax rates will rise. The top income tax rate will rise from 35 to 39.6 percent (this is also the rate at which two-thirds of small business profits are taxed). The lowest rate will rise from 10 to 15 percent. All the rates in between will also rise. Itemized deductions and personal exemptions will again phase out, which has the same mathematical effect as higher marginal tax rates. The full list of marginal rate hikes is below:

– The 10% bracket rises to an expanded 15%
– The 25% bracket rises to 28%
– The 28% bracket rises to 31%
– The 33% bracket rises to 36%
– The 35% bracket rises to 39.6%

Higher taxes on marriage and family. The “marriage penalty” (narrower tax brackets for married couples) will return from the first dollar of income. The child tax credit will be cut in half from $1000 to $500 per child. The standard deduction will no longer be doubled for married couples relative to the single level. The dependent care and adoption tax credits will be cut.

The return of the Death Tax. This year, there is no death tax. For those dying on or after January 1 2011, there is a 55 percent top death tax rate on estates over $1 million. A person leaving behind two homes and a retirement account could easily pass along a death tax bill to their loved ones.

Higher tax rates on savers and investors. The capital gains tax will rise from 15 percent this year to 20 percent in 2011. The dividends tax will rise from 15 percent this year to 39.6 percent in 2011. These rates will rise another 3.8 percent in 2013.

Second Wave: Obamacare

There are over twenty new or higher taxes in Obamacare. Several will first go into effect on January 1, 2011. They include:

The “Medicine Cabinet Tax” Thanks to Obamacare, Americans will no longer be able to use health savings account (HSA), flexible spending account (FSA), or health reimbursement (HRA) pre-tax dollars to purchase non-prescription, over-the-counter medicines (except insulin).

The “Special Needs Kids Tax” This provision of Obamacare imposes a cap on flexible spending accounts (FSAs) of $2500 (Currently, there is no federal government limit). There is one group of FSA owners for whom this new cap will be particularly cruel and onerous: parents of special needs children. There are thousands of families with special needs children in the United States, and many of them use FSAs to pay for special needs education. Tuition rates at one leading school that teaches special needs children in Washington, D.C. (National Child Research Center) can easily exceed $14,000 per year. Under tax rules, FSA dollars can be used to pay for this type of special needs education.

The HSA Withdrawal Tax Hike. This provision of Obamacare increases the additional tax on non-medical early withdrawals from an HSA from 10 to 20 percent, disadvantaging them relative to IRAs and other tax-advantaged accounts, which remain at 10 percent.

Third Wave: The Alternative Minimum Tax and Employer Tax Hikes

When Americans prepare to file their tax returns in January of 2011, they’ll be in for a nasty surprise—the AMT won’t be held harmless, and many tax relief provisions will have expired. The major items include:

The AMT will ensnare over 28 million families, up from 4 million last year. According to the left-leaning Tax Policy Center, Congress’ failure to index the AMT will lead to an explosion of AMT taxpaying families—rising from 4 million last year to 28.5 million. These families will have to calculate their tax burdens twice, and pay taxes at the higher level. The AMT was created in 1969 to ensnare a handful of taxpayers.

Small business expensing will be slashed and 50% expensing will disappear. Small businesses can normally expense (rather than slowly-deduct, or “depreciate”) equipment purchases up to $250,000. This will be cut all the way down to $25,000. Larger businesses can expense half of their purchases of equipment. In January of 2011, all of it will have to be “depreciated.”

Taxes will be raised on all types of businesses. There are literally scores of tax hikes on business that will take place. The biggest is the loss of the “research and experimentation tax credit,” but there are many, many others. Combining high marginal tax rates with the loss of this tax relief will cost jobs.

Tax Benefits for Education and Teaching Reduced. The deduction for tuition and fees will not be available. Tax credits for education will be limited. Teachers will no longer be able to deduct classroom expenses. Coverdell Education Savings Accounts will be cut. Employer-provided educational assistance is curtailed. The student loan interest deduction will be disallowed for hundreds of thousands of families.

Charitable Contributions from IRAs no longer allowed. Under current law, a retired person with an IRA can contribute up to $100,000 per year directly to a charity from their IRA. This contribution also counts toward an annual “required minimum distribution.” This ability will no longer be there.


Yeah, Yeah, Yeah. Freedom, independence and all that. Would you like to be free to plan your own retirement? Do you want the federal government to let you have that Social Security money back and then tell you … invest this, make your plans, and when you stop working you’re on your own. You would? Well then you’re not on the same page of sheet music with most Americans.

Go ahead … celebrate Independence Day, but keep in mind that dependency on government is growing at an incredible rate … 16.3% increase just last year.

But … enjoy your times with your families. And while you’re at it look at your children and try to imagine what kind of opportunities await them in ObamaWorld.

Why Kagan Is Unqualified — and Dangerous

Despite being thoroughly unqualified to occupy the bench, Elena Kagan will most likely be confirmed to the Supreme Court. This is because most of our hundred senators are almost as unqualified to judge a judge as she is to be one. What is the proper criterion to apply? Well, a simple analogy illustrates the point best.

Let’s say you needed to hire a football referee. If he said that he was a “pragmatic” referee, who viewed the rule book as “living” and thus would interpret the rules to suit the “times,” would he be your man?

Since it’s the job of the rule-makers to craft the rules, and the referee’s role is only to determine if they’ve been broken, I think you’d be aghast. It would be obvious that you were dealing with someone who didn’t know what his job was or was unwilling to perform it. And you certainly wouldn’t want to hire a referee who was giving himself the latitude to say, “This fellow here violated a rule, but since I don’t like that rule, I’m going to let his action stand” or “That guy over there has gone by the book, but I don’t like something he did, so I’ll penalize him anyway.”

A judge’s job is analogous to a referee’s. It is the legislature’s (rule-makers’) place to make the rules, and the judge’s only role is to determine if they’ve been broken. How he feels about a given law is irrelevant. He is but a gatekeeper.

Yet there is a difference between the two examples: While people could easily grasp this if the matter were a frivolity such as sports, they entertain the most inane rationalizations when the issue is our national rulebook, the Constitution. They then allow judicial con artists to muddy the waters with specious concepts such as the “living document,” interpretations that suit the “times” and “pragmatism.” They take people such as Ruth Bader Ginsburg seriously when she says the Constitution shouldn’t be “stuck in time.” (It’s not. It’s stuck in law, which can be changed through the Amendment Process.) But these are all dodges that distract us from the truth: There aren’t constructionists and pragmatists, times-oriented judges and text-oriented ones, living-document ones and originalists. At the end of the day, there are only two kinds of justices:

Good justices and bad justices.

Good justices do their job and abide by the Constitution. Bad ones don’t.

And Elena Kagan would be a remarkably bad justice.

Her history and words reveal this clearly. As Phyllis Schlafly recently wrote:

When Kagan was dean of Harvard Law School, she presented a guest speaker who is known as the most activist judge in the world: Judge Aharon Barak, formerly president of the Israeli Supreme Court.

… Barak has written that a judge should “make” and “create” law, assume “a role in the legislative process” and give statutes “new meaning that suits new social needs.”

Barak wrote that a judge “is subject to no authority” except himself, and he “must sometimes depart the confines of his legal system and channel into it fundamental values not yet found in it” [emphasis mine].

And how does Kagan feel about this man?

She calls him her “judicial hero.”

Now, such judges are often characterized as judicial activists, but that is too kind a term. They are Nullification Jurists — and they represent a profound danger to our republic. Let’s examine why.

John Stuart Mill once said, “I can hardly imagine any laws so bad, to which I would not rather be subject than to the caprice of a man.” Well, you can dress the Nullification Jurist fiction up any way you want, but at the end of the day, it is nothing but subjection to the caprice of a man in a black robe.

Think about it: Jurists may say they are interpreting the Constitution to suit the times, but who determines the “times”? The people do. And what are the implications of this “times” philosophy?

First, to abide by the “times” would be to render the Constitution unnecessary, for the very purpose of a constitution is to temper the times with the timeless. That is to say, a good constitution reflects enduring truths, not alluring fashions. It embodies the “votes” of not merely those walking about today, but of all those who have lived since our republic’s inception, for it exists only because the founding generation created it and subsequent ones tacitly approved it by allowing it to stand. It represents the democracy of the whole family of man — including his ancestors.

This stabilizing factor is important because, even collectively, people are prone to fits of emotionalism — to the caprice of men. And because a good constitution is hard to change, it forces a capricious citizenry to take a deep breath and count to ten, at which point the emotion may have subsided and cooler heads may prevail. It acts as a firewall against the mob-rule phenomenon.

Thus, to truly abide by the times would be to reduce us to what remains when you strip away both the Constitution and the legislature: a straight democracy. That is, a democracy with a little twist.

The votes are inferred by judges, who supposedly are infallible conduits of popular opinion.

This is how it could work in theory, anyway. But the reality is that most Nullification Jurists couldn’t care less about the “times.” Case in point: In recent years we’ve seen some state courts divine a right to faux marriage in their state constitutions. But since a majority in every one of those states opposes faux marriage, were the judges really interpreting their constitutions to suit the times? Sure, if it was The New York Times.

The truth is that “living document,” the “times,” and “pragmatism” are nothing but weasel words that facilitate rationalization and obscure Nullification Jurists’ true modus operandi. What is this? Well, since they aren’t abiding by the Constitution or the times, there is only one thing left: what feels right to them.

This mindset isn’t unusual, as people have always found a rationale for their tyranny. For a long time, we had the Divine Right of Kings, stating that a monarch governed according to God’s will and thus wasn’t subject to the will of the people, or any other worldly authority, and that he could do no wrong. Relativists are even worse. A person such as Stalin, Mao, or Pol Pot deified himself, made his worldview (based on what felt right) the little god’s law, and believed he was “subject to no authority except himself.” Sound familiar?

It also sounds dangerous. And we should all be enraged. Remember that while government is supposed to derive its just powers from the consent of the governed, the jurists in question are doing nothing less than nullifying our votes. For they are ignoring the law, which reflects the will of the people as expressed through duly elected representatives. These judges aren’t channeling democracy — they are stealing it.

So what is the solution? Note that Nullification Jurists have signaled their contempt for the law loud and clear. And if they won’t submit to the rule of law, why should we submit to the rule of lawyers? If they won’t accept that the Constitution is “stuck” in law, why should we accept that the law is stuck in courts? Let me be clear: There is neither a moral nor a legal obligation to abide by the rules of the game when judicial oligarchs have brazenly said they will game the rules. Being a Nullification Jurist is a constitution-breaker, a republic-breaker, and, my fellow Americans, a deal-breaker.

The fact that an Elena Kagan could even make it to hearings is already a confirmation. It confirms that most of our leaders haven’t a clue as to how a constitutional republic is supposed to work or, worse still, are content to create an oligarchy of like-minded judicial statists. It is unlawful and renders the government illegitimate, but they do it because they can. And unless we Americans wish to be subject to those who are “subject to no authority except themselves,” governors and citizens should remember this: Nullification works both ways.

21 killed in shootout between drug, migrant trafficking gangs near Arizona border

HERMOSILLO, Mexico (AP) — A massive gun battle between rival drug and migrant trafficking gangs near the U.S. border Thursday left 21 people dead and at least six others wounded, prosecutors said.

The fire fight occurred in a sparsely populated area about 12 miles (20 kilometers) from the Arizona border, near the city of Nogales, that is considered a prime corridor for immigrant and drug smuggling.

The Sonora state Attorney General’s Office said in a statement that nine people were captured by police at the scene of the shootings, six of whom had been wounded in the confrontation. Eight vehicles and seven weapons were also seized.

All of the victims were believed to be members of the gangs.

The shootings occurred near a dirt road between the hamlets of Tubutama and Saric, in an area often used by traffickers.

Gangs often fight for control of trafficking routes and sometimes steal “shipments” of undocumented migrants from each other, but seldom have they staged such mass gun battles.

Gang violence near the Arizona border has led to calls from officials in the U.S. state for greater control of the border and is one reason given for a controversial law passed in April requiring Arizona police to ask people about their immigration status in certain situations.

In a city on another part of the U.S. border, gunmen killed an assistant attorney general for Chihuahua state and one of her bodyguards.

After being chased by armed assailants through the darkened streets of Ciudad Juarez, the vehicle carrying Sandra Salas Garcia and two bodyguards was riddled with bullets Wednesday night.

Arturo Sandoval, a spokesman for the Attorney General’s Office, said the second bodyguard was seriously wounded.

Salas was responsible for evaluating the work of prosecutors and special investigations units in Chihuahua.

Drug violence has killed more than 4,300 people in recent years in Ciudad Juarez, which borders El Paso, Texas.

More than 23,000 people have been killed by drug violence since late 2006, when President Felipe Calderon began deploying thousands of troops and federal police to drug hot spots.