Right to Opine

On this day 236 years ago, a group of men—leaders of the American colonies—gathered in Philadelphia to affix their signatures to what has become one of the most important documents in history. By signing our Declaration of Independence, they risked their fortunes and lives in affirmation of what were to become the foundational and distinctive principles of our nation. Three of these are so fundamental that we find them imprinted on every coin in circulation today. Having come under continuous attack for many years, we must revisit them periodically to remind ourselves of their importance and centrality to our country.

Liberty

Millions of desperate souls have come to America for one significant reason: freedom! Here life is what you choose to make it. You are free to succeed—or to fail—as a result of your own choices rather than the dictates of government. Over the last century we have seen our federal government grow and assume increasing authority. Americans have an instinctive distrust of centralized power. This distrust is justified, as every increase in the government’s power and authority diminishes our individual liberty—one of the most commonly cherished traits of American life. Freedom must be guarded by every generation, for once lost it is very difficult to regain.

E Pluribus Unum

“Out of many, one.” For well over a century, successive waves of immigrants have arrived on our shores, bringing with them their own unique cultures and traditions but learning our common language and assimilating into our society—becoming Americans. Try though you may, you will find no other nation which has openly welcomed a more disparate variety of peoples. The multicultural movement of recent years is at direct odds with this principle, creating enclaves of “hyphenated Americans” rather than a united people. America has always embraced the newcomer, and must continue to do so, making each one a valued member of the whole.

In God We Trust

Finally, and most importantly, Americans do not put their trust in human institutions—not even in the government we choose for ourselves. Our founders acknowledged from the beginning that our rights and freedoms come not from a fallible human institution, but are granted by God. As John Adams put it, “Our Constitution was made only for a moral and religious people. It is wholly inadequate to the government of any other.” Trust in God is the linchpin of our nation, without which freedom is merely bestowed at the whim of the current ruling party, and unity an impossible illusion. We must fight at every turn the attempt to minimize the importance of religious faith in American history and to our nation today.

Liberty. E Pluribus Unum. In God We Trust. Not a Trinity to be worshipped, but one to cherish and defend on this, our Independence Day.

[An enormous, “Thank you,” to Dennis Prager, who made me aware of the American trinity and, to my knowledge, formulated the concept.]

For over a hundred years psychologists have attempted to explain aspects of human behavior through observation of animals in controlled environments.

When liberals do this, e.g., “I saw a male penguin diddling another male penguin, therefore homosexuality must be natural,” they call it SCIENCE. (Usually with much fanfare, but this is a simple blog, so all-caps will have to suffice.)

When a conservative turns the tables, as in this Internet post

The Food Stamp Program, administered by the U.S. Department of Agriculture, is proud to be distributing the greatest amount of free meals and food stamps ever.

Meanwhile, the National Park Service, administered by the U.S. Department of the Interior, asks us to, “Please do not feed the animals.”

Their stated reason for the policy is because the animals will grow dependent on handouts and will not learn to take care of themselves.

This ends today’s lesson.

liberals cry foul, accusing conservatives of being indecent and incompassionate.

When you have no real point to make, it’s far simpler and easier to resort to the ad hominem rather than developing a substantive argument.

Reuters reports that JCPenney stock dropped 8.5% today, which comes on the heels of an 18.9% drop in sales.

In February, J.C. Penney introduced a new pricing scheme that largely did away with coupons and hundreds of sales events shoppers had come to expect, in favor of everyday prices. It launched an advertising campaign featuring comedian Ellen DeGeneres to coincide with the new approach.

The ads were hailed as hip, but critics faulted them for failing to explain the new pricing approach clearly enough. The company last month acknowledged that the ads had resulted in the loss of some longtime Penney shoppers who had looked for markdowns.

Somehow overlooked is the fact that coinciding with the pricing change was a new direction for the company—aggressively pushing a pro-homosexual agenda with DeGeneres at the forefront and conspicuously gay male models in the latest catalogs and ads. Who makes up the bulk of JCP’s customers? Families. Natural families, as in mom and dad. Guess who tend to have traditional, Biblical, conservative moral values and are increasingly tired of having the LGBT agenda shoved in their faces? Natural families, as in mom and dad.

Coincidence? Time will tell.

Jonah Goldberg@Newsday –Analyzing the Republican brain

If you really want to know why conservatives want to quit throwing money down the rabbit hole that is public and “higher” education, look no further. We aren’t anti-science. We’re against the nonsense masquerading as intellectual thought that inundates modern academia.

In Baltimore a tourist was beaten, stripped, and robbed by a group of young thugs. Somehow this was not national news. Watch the video clip that isn’t shown by the local news and venture a guess as to why Al Sharpton, Jesse Jackson, and the entire liberal media have uttered nary a peep about this brutality. [Hint: black-on-white crime doesn’t fit the Left’s agenda. The victim certainly didn’t look like he could have been Obama’s son…though the perps did.]

Michelle Malkin – Marion Barry and the Left’s hatred of Asian entrepreneurs

Yes, racism is alive and well in America…it’s just not coming from conservative whites despite what the Left would have you believe. A white man who said anything remotely similar would have been page one news and lead every nightly newscast.

The Blaze – Rev. Wright Unleashed

This is rather typical of the pastor whose church Obama called home for 20 years, and who Obama once called an important and close advisor and mentor. Can you even imagine the outcry had that been a white pastor? Or specifically the pastor of a GOP President or candidate?

Now look back at the ugly, blatant hate and racism in the three items above. I would love to hear a liberal justify even one of them or simply to demonstrate how they are not representative of the overwhelming liberal bias of mainstream media.

Given that incredible bias it’s amazing that conservatives are ever elected–even when polling repeatedly shows voters holding Right or center-Right views.

Why is it that Democrats seem to see everything–at least everything done by a member of a minority group–through the myopic lens of race?

Senator Harry Reid thinks that his colleague, Marco Rubio of Florida, is a bad Hispanic because he doesn’t toe the line of the overlord party to which all real Hispanics should naturally belong.

So does Reid represent whites? Not this one, I can tell you! With any wisdom on the part of Nevadans, he won’t represent anyone at all after his next ballot appearance.

News flash for Mr. Reid: Rubio doesn’t represent Hispanics. As his office very fittingly responded,

Senator Rubio represents Florida.

The politics of division: classic Leftist tactic of which they never seem to tire.

You really have to love the NY Times. Their latest lament is that America is, apparently, out of touch with the rest of the world when you compare our Constitution with those of other nations.

Other nations routinely trade in their constitutions wholesale, replacing them on average every 19 years.

Yes, they do. Repeat after me, “Stability is a good thing.” America became a great nation because its founding principles are, in fact, timeless. Is our Constitution perfect? Probably not, and it certainly wasn’t as it was originally written. The founders knew that, and so included a mechanism for making changes. The fact that those changes are hard to make, however, has been a great benefit rather than a hindrance.

The rights guaranteed by the American Constitution are parsimonious by international standards…

I actually had to read that a few times. Parsimonious? Then I saw what was missing just a few sentences later:

But the Constitution is out of step with the rest of the world in failing to protect, at least in so many words, a right to travel, the presumption of innocence and entitlement to food, education and health care.

Yes, I see. Americans are terribly restricted in our ability to travel. Huh? And since when are we not guaranteed the “presumption of innocence” in court? It’s one of the pillars of our legal system and always has been. Then comes the kicker: entitlements. A country that is fighting an increasing epidemic of obesity lacks an “entitlement to food”? Really? The left is so preoccupied with what we are “entitled” to that it entirely ignores our responsibilities.

And then, of course,

It has its idiosyncrasies. Only 2 percent of the world’s constitutions protect, as the Second Amendment does, a right to bear arms.

That, in the end, is what guarantees our liberty. So long as Americans can arm themselves, the government cannot exert unlimited power over us. This is no small freedom.

To be fair to the authors, they concluded with a powerful and unrebutted counterpoint by Supreme Court Justice Antonin Scalia:

“Every banana republic in the world has a bill of rights,” he said.

“The bill of rights of the former evil empire, the Union of Soviet Socialist Republics, was much better than ours,” he said, adding: “We guarantee freedom of speech and of the press. Big deal. They guaranteed freedom of speech, of the press, of street demonstrations and protests, and anyone who is caught trying to suppress criticism of the government will be called to account. Whoa, that is wonderful stuff!”

“Of course,” Justice Scalia continued, “it’s just words on paper, what our framers would have called a ‘parchment guarantee.’ ”

Yeah, I really wish our country were more like Canada. It’s a great model of individual freedom and freedom of speech. I’ll take the liberties enshrined in our founding documents, thank you.

The Left, led by our Wealth-Redistributor-in-Chief, keeps hammering away at how the rich don’t pay their fair share of taxes. The latest faux example of unfairness they’re trotting out before the gullible (and sadly ignorant) public is Republican candidate Mitt Romney. In what can only be either a deliberate hit piece or shoddy journalism (or, more likely, both), the AP today asks, “ Why is investment income taxed less than wages?”

From the beginning to the end, the article is sprinkled with liberal talking points and misleading inferences.

Why do Mitt Romney and other wealthy investors pay lower taxes on the income they make from investments than they would if they earned their millions from wages? Because Congress, through the tax code, has long treated investment more favorably than labor, seeing it as an engine for economic growth that benefits everyone.

Yes, and the reason Congress has done so is that it’s true. As I pointed out before, when you tax something too much, you get less of it. If you want capital to flee the country for better business environments, raise the capital gains rate.

They throw in the obligatory comment from a conservative economist who points out that capital gains taxes amount to taxing the same income twice. This of course, is immediately rebutted with:

Lots of people are double taxed, says Chuck Marr, director of federal tax policy for the liberal Center on Budget and Policy Priorities. “Check out your last pay stub: There‘s income tax and payroll tax, so you‘re double taxed, too,” Marr said.

The problem with this—and Marr can’t possibly be ignorant of the fact—is that before a shareholder receives a capital gain from a stock investment, that money has already been taxed under both the income and payroll taxes at the corporate level. The shareholder, as an owner of the company in question, has already paid both income and payroll taxes. The capital gains tax is an additional tax on the same money, belonging to the same person. It’s as if the IRS looked at every individual taxpayer on April 16 and said, “Oh, you have money left over? Let’s take another 15% of that.”

No, it’s actually worse than that. If I want to buy shares in a company, I have to first earn the money with which to do so. That income is taxed (income and payroll) at my individual rate. With what the government graciously allows me to keep, I take a risk investing it in a company. As an owner of that company I pay taxes on its earnings (income and payroll). If there’s enough left over for the company to pay me a dividend, I now pay a third tax for capital gains.

But the real gotcha is this beautiful class warfare gem:

Romney, who released his 2010 and 2011 tax returns this week, has been forced to defend the fact that he paid a tax rate of about 15 percent on an annual income of $21 million. His tax rate is comparable to the one paid by most middle-income families. His income, however, is 420 times higher than the typical U.S. household.

It took me all of thirty minutes to research the facts that display how utterly false this statement is. If I can do it on my own time for free, why doesn’t a “journalist” do the same? Consider:

• CNN points out that “roughly 45% of households, or about 69 million, will end up owing nothing in federal income tax.”
• According to the Census Bureau, median income is $49,777 for 117,538,000 households.
• According to the IRS, the total individual tax liability was $865,948,271,000.

So even though almost half of households pay no taxes at all, the average household tax liability is just under $7400. Now 15% of $21 million is $3,150,000. So Romney paid roughly 425 times the taxes of the typical household. It doesn’t take a rocket scientist to see that 425 > 420. So Mitt Romney paid more than his fair share in taxes.

So when the prevaricator who currently occupies the White House tells you,

“Now, you can call this class warfare all you want,” Obama said. “But asking a billionaire to pay at least as much as his secretary in taxes? Most Americans would call that common sense.”

take a look at the facts and use your own common sense. Don’t buy the “fairness” lie.

Did anyone else just love this little nugget from Obama’s State of the Union?

Or we can restore an economy where everyone gets a fair shot, everyone does their fair share, and everyone plays by the same set of rules.

By “same set of rules” I can only assume he intends to stop taking money from people who have made good decisions and worked hard—and are now enjoying the fruits of their effort—and handing it to people who haven’t. The rules I live by—I stayed in school, worked hard for my grades, spent twenty years developing marketable skills, so I am able to own a home, feed and clothe my family and enjoy the occasional vacation–now apply to everyone? Yeah, right.

There’s been a lot of overblown rhetoric coming from the Left lately about the capital gains tax. Even some big investors—like Warren Buffett—who know better have been banging their drums to raise the capital gains rate. To see why this is terribly wrong-headed we need to look at the purpose and impact of taxes and see how that relates to capital gains.

Taxes are imposed for two reasons. The first, and most obvious, is to generate revenue for the government. Everyone agrees that some level of taxation is requisite and reasonable in order to fund necessary government functions. The second, often overlooked, is to encourage or discourage specific behaviors.

Having recently moved from Arizona to North Carolina, I can attest to an obvious example of the complex interaction of these two purposes: cigarette taxes. Many states impose high taxes on cigarettes in order to discourage smoking. Arizona’s cigarette tax is $2 per pack, while North Carolina’s is $0.45. When AZ raised its rate from $1.18 to $2, total revenues from the tax fell as smokers quit. In NC, not only is the tax low, but practically everyone in the state lives within a mile of a tobacco farm—and smoking is rather prevalent. When NC initially raised its rate from $0.05 to $0.30, there was a drop in sales volume, but not enough to counter the tax increase—tax revenues increased marginally. Another interesting impact of taxation rears its head here: when NC raised its cigarette tax, sales increased significantly in neighboring South Carolina which, at the the time, maintained a $0.07 tax rate. I doubt that South Carolinians suddenly started smoking in droves—those sales were going north across the state line. In AZ, sales on Indian reservations—which do not tax tobacco—went up as well, mitigating the smoking cessation effect and leaching both cigarette and sales tax revenues from the state.

I use this as the near-perfect example because it highlights the tension between the purposes and effects of a tax. When tax rates are increased, there may be a corresponding increase in revenues, or there may be a decrease as demand for the underlying activity or product decreases. It may well be that the effect of decreasing smoking incidence is of greater societal benefit than the loss in revenue is detrimental. But that goal is diminished when demand can be met simply by taking business elsewhere. What is of importance here is not to discuss the cigarette tax specifically, but to see and understand the effects of tax increases.

Now let’s slide into the capital gains tax (CGT). Simply speaking, a capital gain is realized when an investor sells an interest in something (most often in the form of property or stocks, bonds, or fund shares in a business, or dividends) for an amount higher than he originally paid. Taxes on the gain are paid at 15% for long-term investments (reduced to 0% for the bottom two personal income tax brackets) or the personal rate for short-term investments (less than a year). Consider a simple example.

An investor buys into a company for $1000, and later sells for $2000. The capital gain is $1000, so at the current 15% rate, he would pay $150 in capital gains tax. That sounds like a screaming deal, right? The guy just walked off with an 85% return on his investment! This is exactly what the Left and their media tail-waggers want you to think. The problem is that they’ve left out a huge factor in the equation: time. If the sale were made relatively soon after the purchase, then the investor really did come out with a screaming deal. But the overwhelming majority of investments don’t double in value over a short period. In fact, when you look at the stock market as a whole you begin to see why financial advisors tell you to pick solid investments for the long-term. Suppose instead that the investor keeps his money in the company for a number of years. Well, if inflation were only 3% then in 17 years his initial $1000 has inflated to $1650 so his real gain from the sale is only $350. That same $150 tax is 43% of the real gain. If, as the Left wishes, we raise the capital gains rate to 35% to match the top personal rate of 35%, then his tax becomes $350 and completely swallows his real gain. In the end he’s only left with the money he started with at its new, inflated value.

One effect, then, of a capital gains increase is to make long-term investment less valuable. Mega-investors like Warren Buffett and George Soros are very well aware of this impact on the market, and use it to their advantage. Think of how often you read in the paper that one of those two just invested hundreds of millions of dollars in some particular venture—nearly every week. Billionaires like those two can afford to play more often in the medium-term market—and do—because they can afford to take the occasional significant loss. (Consider in particular that Soros made his name by shorting the pound in the U.K., contributing greatly to the crash of their monetary system.) Now you can see why Buffett has no problem raising the capital gains rate—because his investments are often of shorter term, they are less impacted by inflation. (Short enough to diminish the effect of inflation, but long enough to avoid the short-term CGT, which is the same as the higher personal income rate.)

The second effect of a capital gains increase is—as in the case of the cigarette tax—to move monetary transactions (and the profits they generate) elsewhere. Why do you think so many people worldwide sink their money into Asian, Caribbean, and South American banks and funds? Barbados, with no CGT, reportedly has over $25 billion in Canadian investments. Other growing economies with no CGT include Belize, the Cayman Islands and Jamaica and, on the other side of the Pacific: Hong Kong, Malaysia, and Singapore. Do you think it sheer coincidence that many of these are also major financial centers with investors from around the world? And even Brazil, with a CGT of 15%, stands to gain if we were to raise our rate to the Left’s envisioned 35%. Their economy is booming. Do you really think that if we raise our rate investors from both here and abroad will even hesitate to move their funds to Brazil? Get real.

You don’t improve an economy by undermining the capital base upon which growth is built. Before you buy into the class warfare rhetoric being spewed by the current denizens of the White House, consider the real purpose and effect of taxes and decide for yourself where the greater good of our nation lies.