Archive for the ‘Economy’ Category
Another Fortune 500 company announced it’s leaving Minnesota. It’s explanation is starting to sound familiar:
“SpartanNash chose Western Michigan as its headquarters due to it being centrally located to the merged entities operations, the positive business climate taking hold in Michigan, including a more favorable tax environment, and the quality of life Michigan provides for its associates,” the company said in a statement.
That sounds familiar. Here’s what Cargill said when it moved:
Dan Dye, Horizon’s president and Ardent’s CEO-to-be, said in a statement that the decision “will allow us to offer great quality of life for employees, provide excellent service to our customers and position the business for long-term growth.”
If Gov. Dayton and the DFL are given 4 more years to implement their leftist vision for the state, Minnesota will be in worse shape than California and Illinois are in right now. Cargill cited their desire to “position the business for long-term growth.” Nash Finch, aka SpartanNash, talkd about “a more favorable tax environment.”
Implicit in both statements is their belief that the Dayton administration’s and the DFL’s anti-prosperity policies would hurt their companies’ ability to make profits and continue employing people. The leftists’ belief that profits are despicable is utterly wrong-headed.
I cited a single-payer health activist’s quote in this post:
There would be a removal of profit-motive in health care. The driving force behind the health industry would be patient care and not profit maximization.
This isn’t just a glimpse into the mind of hardline leftists. It’s who they are. That statement explicitly says that they think things would improve if profit-motives were removed from health care. The opposite is actually true.
Companies pursuing their own self interests are what make the economy stronger. The great inventions of the last 150 years came when there was an incentive, aka profit, to create and innovate. Milton Friedman once told Phil Donahue that the only economic system where “the masses escaped the grinding poverty you talked about” were in societies that appreciated capitalism and “largely free trade.”
SpartanNash and Cargill are exercising their right to enhance their profits by moving their operations. They’re moving their operations because Gov. Dayton and the DFL drove up the cost of doing business in Minnesota this last session. If Minnesota doesn’t reverse Gov. Dayton’s and the DFL’s policies, Minnesota will soon look like a ghost town.
Cargill and SpartanNash just implicitly said that Minnesota is that special that they wouldn’t leave. Will it be that much longer before other companies leave?
Don Davis’s article is this weekend’s must reading.
Overall, much of the $2.1 billion, two-year tax increase comes from the state’s highest earners and smokers. Dayton made the point that if property taxes rise 2 percent statewide, that would far less than the 83 percent they have gone up in the past decade. “I think that we did the job of delivering property tax relief,” House Speaker Paul Thissen, DFL-Minneapolis, said.
Democrats say that higher taxes usually mean better services.
That’s fantasy. Higher taxes usually means mayors feel less inhibited to spend significantly more money on things their cities don’t need. Considering the fact that the same Tax Bill that raised every Minnesotan’s tax bill was used to appropriate money for a pork palace for politicians. I’d love hearing Sen. Bakk or Speaker Thissen explain how higher taxes and shiny new office buildings mean more and better services for Minnesotans.
I’d also highlight the fact that higher taxes didn’t make MnSure more taxpayer-friendly. Despite the multi-billion dollar tax increase, MnSure still gets weekends and holidays off while Minnesotans scramble franticly to get insured.
“Any tax increase in inherently unpopular,” Gov. Mark Dayton said in a Forum News Service interview. “But it will be a message battle. Republicans will try to say ‘largest tax increase in history’ and we will say ‘the people who have the most are paying it, and smokers.’”
The DFL, aka Democrats, will argue that they ‘taxed the rich’. Republicans will highlight the fact that the DFL also raised taxes on farmers, small businesses and chased a major part of Cargill’s operations to Colorado:
Why Denver? Dan Dye, Horizon’s president and Ardent’s CEO-to-be, said in a statement that the decision “will allow us to offer great quality of life for employees, provide excellent service to our customers and position the business for long-term growth.”
The Democrats’ policies are hurting Minnesota’s economy while piling additional tax burdens on farmers, blue collar workers and small businesses. Couple that with the DFL’s intent to dramatically increase the minimum wage, via constitutional amendment if necessary, and you’ve got the recipe for economic calamity.
Based on what we’ve seen thus far, the DFL’s claim that higher taxes equals better services is spin, not fact. Higher taxes just mean people have less money to spend.
Technorati: Tax The Rich, Property Taxes, Mark Dayton, Paul Thissen, MnSure, Government Services, Tax Increases, Minimum Wage Increase, Constitutional Amendments, Recessions, DFL
Sen. Franken has said some outrageous things in office. At this point, I’m not surprised at Sen. Franken’s outrageous statements. I’m more surprised when he makes a sensible statement. Sen. Franken’s quote in this article is indicative of what type of senator he is:
U.S. Sen. Al Franken, who is running for re-election next year, said he was still reviewing the details of the president’s proposal to determine whether it’s sufficient.
“But I believe it’s a step in the right direction and I hope it will help those Minnesotans whose plans were cancelled,” he said.
That’s proof that Sen. Franken, first and foremost, is an Obama apologist. President Obama’s ‘fix’ is a political gimmick. It isn’t a serious policy adjustment.
First, partisans like Howard Dean knows that President Obama doesn’t have the constitutional authority to unilaterally rewrite laws. Either Sen. Franken doesn’t respect the Constitution’s separation of powers or that point escaped him. It’s troubling that a U.S. senator is either disinterested in the Constitution or is utterly incompetent.
Second, state insurance commissioners had said that they wouldn’t approve the re-instatement of the old plans that don’t meet the Affordable Care Act’s minimum requirements. President Obama’s fix is a gimmick that serious people have already dismissed. Don’t Minnesotans have the right to expect Sen. Franken to act in their best interest rather than playing the role of President Obama’s apologist?
Third, this shows how little Sen. Franken understands how businesses function, especially those that deal with actuarial data. Insurance premiums aren’t determined by guesses. They’re calculated, then examined for accuracy, then double-checked to make sure the math is rock solid. Apparently, Sen. Franken thinks that an insurance company can pull a new policy together without first calculating the risks and the demographics.
Fourth, Sen. Franken said that he “hopes” this will help Minnesotans. That would require putting specific policies together, then getting the insurance commissioner to approve the new policy offerings. That’s before considering the fact that 140,000 Minnesotans need that insurance in place by January 1, 2014. That’d effectively give insurance companies about a week to pull their part off while giving insurance commissioners another week to approve those policies. If that happens, which isn’t a guarantee, then customers would have about 2 weeks to find a plan, then purchase it.
Even Mary Poppins couldn’t get Minnesotans to swallow that nonsense.
Charles Krauthammer’s latest column offers this advice:
It’s Halloween. There is a knock at your door. You hear: “We’re the government and we’re here to help.”
With the Affordable Care Act failing beyond even the most pessimistic Republican’s worst nightmare, that’s sage advice. This, though, is the most disturbing information in Dr. Krauthammer’s column:
So that your president can promise to cover 30 million uninsured without costing the government a dime. Which from the beginning was the biggest falsehood of them all. And yet the free lunch is the essence of modern liberalism. Free mammograms, free preventative care, free contraceptives for Sandra Fluke. Come and get it.
And then when you find your policy canceled, your premium raised and your deductible outrageously increased, you’ve learned the real meaning of “free” in the liberal lexicon: something paid for by your neighbor best, by subterfuge.
That last clause in the last sentence reminded me of this famous quote:
As soon as A observes something which seems to him wrong, from which X is suffering, A talks it over with B, and A and B then propose to get a law passed to remedy the evil and help X. Their law always proposes to determine what C shall do for X, or, in better case, what A, B, and C shall do for X… What I want to do is to look up C. I want to show you what manner of man he is. I call him the Forgotten Man. perhaps the appellation is not strictly correct. he is the man who never is thought of…. I call him the forgotten man.
There’s a poem that goes with that famous quote. It says “If you promise to not tax me, I promise not to tax thee. Instead, let’s tax that fellow behind the tree.” That’s the essence of the Affordable Care Act. In fact, it can’t survive without the “forgotten man” subsidizing someone else’s health insurance.
In this instance, the forgotten man are really forgotten people. Specifically, they’re called “young healthies” by the pundits. They’re being counted on to buy health insurance they don’t need. If they don’t buy insurance in significant numbers, there isn’t a way for the government or the insurance companies to pay for health care of older people and/or people with pre-existing conditions.
Another forgotten man in this are middle class families who make too much to qualify for premium support but who’ve been getting squeezed with higher taxes and higher costs of goods. They’re getting hit with higher premiums, thanks to A and B conspiring to force the forgotten man, aka middle class families, into buying health care coverages they don’t want or might never need.
That’s why it’s wise to be suspicious of politicians promising free lunches.
Technorati: Free Lunches, Individual Mandate, Health Insurance Exchanges, Sandra Fluke, President Obama, Affordable Care Act, Free Lunches, Government Bureaucrat, Democrats, Liberalism, William Graham Sumner, The Forgotten Man, Charles Krauthammer, Conservatism, Free Markets
Sen. Franken’s grasp of what’s happening with the Affordable Care Act is breathtakingly devoid of reality. This KSTP video shows how much Sen. Franken is in denial:
Scott Theisen’s article for KSTP highlights the fact that Sen. Franken a) doesn’t want to admit that HealthCare.gov is an unmitigated disaster and b) is in total spin mode:
Speaking to the media after meeting in St. Paul with medical device company officials, the Minnesota Democrat said ongoing technical problems with the federal health insurance website are “inexcusable.” But Franken said he thinks they’re getting better.
That’s total BS. HealthCare.gov is still sending incorrect personal information to the insurance companies. The website is still a nightmare to navigate. If Sen. Franken thinks that improving minor things on the periphery is proof that things are getting better, he’s setting his sights too low.
Sens. Jeanne Shaheen of New Hampshire, David Pryor of Arkansas and Kay Hagan of North Carolina advocated an extension. Like Franken, both Pryor and Hagan are up for re-election next year and are likely to be judged by voters for the success or failure of the law at that point.
Franken wasn’t ready to join their chorus, though he didn’t rule out eventual delay. “We’ll have to see how long this takes to get fixed and how much improved this is,” Franken said. “I’d be open to that if this continues, of course, but my understanding is this is improving every day.”
Sen. Franken shouldn’t be trusted if he’s willing to say that things are “improving every day.” If things are “improving every day,” why did President Obama push Kathleen Sebelius off to the side and put Jeff Zients in charge of getting HealthCare.gov functioning properly?
This isn’t complicated. Either Sen. Franken thinks that things are improving or he takes note that the woman tasked with putting HealthCare.gov together for the last 3 years was thrown under President Obama’s bus. He can’t believe both things are proof that things are improving.
On a different but related topic, during the news segment of At Issue With Tom Hauser, Sen. Franken said that he’s still pushing to repeal a tax he voted to create. He’s supporting the repeal of the medical device manufacturing excise tax, saying that the device tax “is chasing companies overseas.”
I don’t doubt that the device tax is chasing companies overseas because I wrote about that phenomenon in this post:
“This bill is a jobs killer,” said Ernie Whiton, chief financial officer of Chelmsford’s Zoll Medical Corp., which employs about 650 people in Massachusetts. Many of those employees work in Zoll’s local manufacturing facility making heart defibrillators. “We could be forced to (move) manufacturing overseas if we can’t pass along these costs to our customers,” said Whiton.
Here’s what we know about Sen. Franken: he thinks HealthCare.gov is improving and he’s finally figured out that the tax he voted to create drives employers away. Further, we know that Republicans predicted this of the medical device tax from before the tax was created.
Question: Why should Minnesotans vote for the not-too-bright Franken when they can vote for someone who actually knows how to create jobs? That decision is a no-brainer.
The jobs report that was supposed to come out on Oct. 3 was released this morning. It isn’t good news for the Obama administration:
September saw the U.S. economy add just 148,000 jobs, significantly worse than expected, according to a report delayed more than two weeks by the government shutdown.
The unemployment rate unexpectedly fell to 7.2 percent, the lowest since November 2008, as the labor-force participation rate held near 35-year lows, according to the Bureau of Labor Statistics.
Private payroll creation stood at just 122,000, with state and local governments adding 28,000 positions and the federal government cutting by 6,000.
That’s just the tip of the iceberg. Here’s some data from ZeroHedge on what jobs were created:
As part of our monthly NFP-day tradition, we break down the monthly job gains (and losses) by industry. So here they are: in September the biggest job gaining sectors, accounting for 86K jobs or 58% of the total 148K jobs added, were the following four industries:
- Transportation and Warehousing: + 23K
- Government: +22K
- Retail Trade: +21K
- Temp Help: +20K
In short: nearly two thirds of all jobs created in September (according to the BLS’ increasingly more flawed data so these numbers are likely completely made up) were truck drivers, bureaucrats, salespeople and temps.
What about “real” jobs: well, Financial Activities were down 2K, Manufacturing were up 2K, Information (those very critical programmers so instrumental in the glitchless roll out of Obamacare): +4K, and Professional and Business Services (ex temps): +12K.In other words, there’s reason to worry that the economy is slowing down. That doesn’t necessarily predict another recession. It just means the economy might be weakening.
Most Almanac Roundtable panelists think that conservatives are lunatics who couldn’t do anything right if their life depended on it. Friday night’s panelists were Larry Jacobs and Kathryn Pearson from the U of M, David Schultz from Hamline and Steve Schier from Carlton College. Predictably, the subject was identifying the political winners and losers from the government shutdown. Most of the conversation was about bashing conservatives, especially TEA Party activists. Just when all hope for an informative conversation seemed lost, Larry Jacobs provided this insight:
You know, it’s very interesting. We tend to be very short-term oriented. November, 2014 is the date that’s really going to really make a difference. That’s a long way off. When you look back at the 1995 shutdown, there was a big focus on ‘Did Clinton get a boomerang in his favor in the 96 election’? Research doesn’t really show that and, when you look at this more carefully, I think the news for the Democrats is not so rosy. There could definitely be some Republicans looking at the data thinking that ‘we’re gonna bide our time here. The main thing that I see happening on the Democratic side is President Obama’s approval rating sliding down. There’s been a little bit of an uptick but the general trend has been downward. The bigger point is that 71% of Americans are now saying that the economy is worse off. That’s going to further drive down the president’s approval rating. And we know, probably, that the drop in consumer confidence and other factors will further drive down. All of that will likely create a drag on Democratic candidates going into 2014.
When Christopher Stevens was killed in Benghazi, the administration knew they’d be protected by their media allies. That meant they could stonewall investigators until after the election. That isn’t the case here. There’s tons of time for reality to set in. People are already noticing the expensive insurance premiums, the unreliable health insurance exchange website and the high deductibles.
There’s no question that President Obama, Kathleen Sebelius, Jay Carney and allies like Nancy Pelosi will attempt to hide the fact that the Affordable Care Act isn’t working and isn’t workable. It’s junk. This administration’s spin won’t work. Eventually, reality catches up with the spin. Jay Carney’s and Kathleen Sebelius’s insistance that things are working or that they’re working around the clock to fix things won’t mean much when the conversation at water coolers across the nation is that HealthCare.gov isn’t workiing.
As people find out that the flaws in HealthCare.gov’s aren’t glitches, people will take it out on Democrats since they’re the only ones that voted for the Affordable Care Act. When people find out that the Affordable Care Act’s exchanges aren’t working because the software is deeply flawed, they’ll have reason to think that the Party of Big Government is inept. Once that sinks in, Democrats will have a difficult fight on their hands.
Schultz, Schier and Pearson can think Republicans are big losers and that Democrats will retake the House because of that but that isn’t reality. The reality is that Republicans can point to some votes that Democrats cast against extremely popular things. That’s especially true in the Senate, where Mary Landrieu, Kay Hagan, Mark Begich and Mark Pryor voted against delaying the individual mandate, against repealing the medical device tax while voting for giving politicians a subsidy for health insurance that isn’t available to other people making the same salary.
People don’t like politicians who expect special treatment while shafting working people. Democrats should expect a particularly bumpy road through next November.
Technorati: Harry Reid, Nancy Pelosi, Jay Carney, President Obama, Kathleen Sebelius, Health Insurance Exchanges, Affordable Care Act, Kay Hagan, Mary Landrieu, Mark Pryor, Mark Begich, Democrats, Election 2014
This LTE in the St. Cloud Times insists that we aren’t a deadbeat nation:
There should never be any bargaining about raising the debt ceiling. We are not a deadbeat nation.
KrisAnne Hall has a different perspective:
On Friday, President Barack Obama told workers at a Ford plant in Liberty, Missouri, “if we don’t raise the debt ceiling, we’re deadbeats.” This is a prime example of “fundamentally transforming” America. This is part of the strategy that leftists use, change the definition of words, seize the vocabulary. Obama wants you to believe that racking up bills that you can’t pay for in the first place, and then borrowing money to pay those bills, and then passing on that debt to your children is the responsible thing. It used to be that people understood that if you robbed from your children you were, fundamentally, a deadbeat.
To Ms. Maizan’s point that we aren’t a deadbeat nation, I’d simply argue that a government that spends money it doesn’t have on things it doesn’t need is the quintessential deadbeat nation. Glenn Reynolds’ column provides a fantastic solution:
With these lessons learned, here’s my budget proposal: An across-the-board cut of 5% in every government department’s budget line. (You can’t convince me — and you’ll certainly have a hard time convincing voters — that there’s not 5% waste to be found in any government program.) Then a five-year freeze at that level. Likewise, a one-year moratorium on new regulations, followed by strict limits on new regulatory action: Perhaps a rule that all new business regulations won’t have the force of law until approved by Congress.
Earlier in his column, Professor Reynolds stated something elementary:
As economist Herbert Stein once observed, something that can’t go on forever, won’t. And this can’t go on forever.
Anyone that thinks federal spending can be sustained is foolish. By this definition, Ms. Maizan is foolish. Taxing the rich more to pay for irresponsible spending won’t fix anything. In fact, I’d argue that raising taxes without questioning what politicians are spending money on is the political equivalent of a junkie scoring a fix for his addiction.
Professor Reynolds makes a string of fantastic points on the shutdown. Here’s my favorite:
The big lesson of the shutdown is that, in a time when so-called “draconian cuts” usually refer to mere decreases in the rate of growth of spending on programs, America was able to do without all the “non-essential” government workers just fine. (The same AP poll cited above says that 80% have felt no impact from the shutdown; a majority also oppose increasing the debt limit.) Turns out that most of those nonessential workers really are non-essential. And it’s a safe bet that some of those who stayed on the job, like the National Park Service people who chased veterans away from an open-air memorial, could be done without, too, in a pinch. Under the shutdown, new regulations also slowed to a trickle, suggesting that we can do just fine without those, too.
Let’s not forget this point. If President Obama hadn’t implemented his World War II Memorial strategy, taxpayers wouldn’t have noticed that government is shut down.
I agree with Reynolds and KrisAnne Hall. It’s time to stop spending like a deadbeat. It’s time to say NO MORE!!! This administration’s reckless spending isn’t sustainable. If it can’t be sustained, it won’t continue. This nation can’t afford 3 more years of President Obama playing the role of deadbeat politician.
Currently, all of the attention in DC is on the US Senate. That’s understandable because that’s where the action is. That isn’t where the bottleneck is, though. Republicans who put a higher priority on the public good rather than the ‘art of the possible’ aren’t likely to support the Senate compromise:
A flurry of phone calls and meetings last night and early this morning led to that consensus among the approximately 50 Republicans who form the House GOP’s right flank. They’re furious with Senate Republicans for working with Democrats to craft what one leading tea-party congressman calls a “mushy piece of s**t.”
It’s one thing to negotiate with Democrats in a divided government. It’s another to outright cave to President Obama’s demands.
Some important points must be made at this point. First, whether Republicans enthusiastically embrace the bill or whether they vehemently oppose the bill, Democrats will blame Republicans for the shutdown. They’ve already called Republicans anarchists (Sen. Reid), likened them to spousal abusers (Sen. Boxer) and called them legislative arsonists (Rep. Pelosi).
Why wouldn’t Republicans expect them to drop their gloves during next year’s campaign?
“What they’ll come up with in the Senate will not get the support of most House Republicans,” predicts a House conservative strategist. “And thus, after a lot of hand-wringing, it’ll be DOA. Just like with BCA in 2011, the most important question is, what can pass the House? Everything else is subordinate to that. So, while the Senate is taking the lead right now, I expect the focus will soon shift back to the House, and back to the idea of doing a six-week extension of the debt ceiling. While Obama and Reid won’t like it, they don’t want to go past October 17, either. The politics of the debt ceiling are different from the shutdown. And so, we feel they’ll reluctantly accept it as a stopgap measure.”
Republicans have some leverage, at least if Senate Republicans don’t squander this opportunity. If Republicans insist that the individual mandate be postponed a year and that Congress and their staff don’t get subsidies that other Americans aren’t eligible for in exchange for raising the debt ceiling, they’ll win that fight.
That’s because President Obama can’t afford a default on his watch, especially when there’s a perfectly reasonable offer on the table. It isn’t difficult selling people on the notion that politicians shouldn’t get subsidies that aren’t available to the average Joe or Jane.
Similarly, it isn’t difficult convincing people that the health insurance exchanges aren’t operational. Connecting that with delaying the individual mandate isn’t that difficult either.
That’s how Republicans win this fight and resurrect their standing with the American people. It’s a win-win situation for the GOP — if they don’t let Senate squishies blow it for them.
Yesterday, the office of Minnesota Management and Budget, aka MMB, reported that revenues fell short of expectations for the first quarter under the Democrat-passed budget for Fiscal Year 2014-15. Here’s Rep. Jennifer Loon’s response to the news:
“Governor Mark Dayton and Democrat majorities’ budget, effective July 1st, forces hardworking taxpayers to pay more when they can least afford it for excessive government spending. The simple fact is our state spending is far-outpacing our state’s economic growth. Today’s news is a departure from the positive trajectory state revenues have been on for the last two years,” said Rep. Loon.
Thursday’s announcement from MMB comes just ten days after the state closed the books on the Republican-passed budget for Fiscal Year 2012-13. According to MMB, the Republican-passed budget ending June 30, 2013 exceeded projections by more than $3 billion.
“Despite the positive results from the Republican-passed budget of the last two years, Democrats decided to take the state in the opposite direction this legislative session. Between Democrats’ damaging tax increases already in effect and the upcoming impact of Governor Dayton’s warehousing tax and health insurance exchange, the road to a healthier economy in Minnesota just got steeper.”
That wasn’t the only bad news for the Dayton administration. The Tax Foundation released its 2014 annual report. Here’s the key takeaway from their report:
The 10 lowest ranked, or worst, states in this year’s Index are:
44. North Carolina
46. Rhode Island
49. New Jersey
50. New York
This is what report said:
Minnesota, by contrast, enacted a package of tax changes that reduce the state’s competitiveness, including a retroactive hike in the individual income tax rate. Since last year, they have dropped from 45th to 47th place.
Ben Golnik, the Chairman of the Minnesota Jobs Coalition, issued this statement on the Tax Foundation’s report:
“This new study is the latest evidence that Mark Dayton’s massive, job-killing tax increases are hurting Minnesota. It’s obvious that raising taxes by nearly $2 billion to cover a budget deficit one-third that size was excessive.”
The only reason Minnesota’s economy isn’t tanking is because of massive amounts of government spending. Put differently, taxpayers are artificially propping up Minnesota’s economy. Real economic growth isn’t possible when government punishes profitmakers, aka job creators.
The contrast between the budget that the GOP legislature passed and the budget that’s now in place couldn’t be more stark. The GOP budget generated enough revenue to fill Minnesota’s rainy day fund and pay off all but $238,000,000 of the school shift. The Dayton/DFL budget is already falling short of their revenue projections.
With Sen. Bakk already threatening to not repeal the warehousing services sales tax, the farm equipment repair sales tax and the telecommunications sales tax, Minnesota’s employers have less incentive for staying in Minnesota. Cargill has already moved two of its operations to other states. Red Wing Shoes is seriously considering moving its warehousing operation to Wisconsin. Other iconic Minnesota companies like DigiKey and Polaris are thinking of moving across the border.
As Rep. Loon said, the Democratic legislature chose to take Minnesota in a different direction. The early results of their change of direction are ominous. I’m not surprised.
Technorati: Mark Dayton, MMB, Taxes, Tax Increases, Warehousing Tax, Farm Equipment Repair Sales Tax, Sales Tax, Tom Bakk, Daytonomics, Red Wing Shoes, Cargill, Deficit, DFL, Jennifer Loon, Ben Golnik, Minnesota Jobs Coalition, Tax Foundation, Business Climate, Surpluses, MNGOP