The Locker Room

April 23, 2009

What can the private sector do?

Posted by Joseph Coletti at 5:04 PM

There are too many restraints on what charities and the private sector can do and how they can do it according to a new book from Dan Pallotta, whose for-profit company raised more money for breast cancer and AIDS research than anybody else. Maybe there aren't as many things that "the public sector must do."

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You might be a progressive if ...

Posted by Jon Sanders at 4:40 PM

You think volunteering ought to be mandatory, and you think that private charity ought to be discouraged while public "giving" ought to be coerced.

A note to my fellow bloggers in this "You might be a progressive if" series: We keep using the phrase "You think." Progressives don't think. They "feel."

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RE: Conservative Speaker Wins Round II at UNC

Posted by David N. Bass at 2:42 PM

Jay's piece is definitely worth a read. My favorite section:

[Riley Matheson, founder of the UNC-CH chapter of Youth for Western Civilization, the group that brought Tancredo and Goode to speak] used the changing tide of sentiment to get in a dig at the protesters, who, in the previous week, appeared to directly target him with a threatening chant: "Against racists, we will fight. We know where you sleep at night."

This week, when one protester shouted at him, "We know where you live," Matheson responded, "Anybody who is interested in exploring becoming a member of Youth for Western Civilization can contact me by email, or just stop by my house...since you already know where I live. I've got a 12-guage."

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Conservative Speaker Wins Round II at UNC

Posted by Jay Schalin at 1:24 PM

Last night, the radical punks who shouted down and chased Tom Tancredo from the podium last week in Chapel Hill got put in their place during a speech by former Virginia congressman Virgil Goode. All it took was for UNC officials to accept some responsibility for maintaining a relatively civil discourse instead of letting the mob take over.

Perhaps my favorite comment of the evening was by a middle-aged man who said, "Jesse Helms once said we don't need a zoo in North Carolina, all we have to do is put a fence around Chapel Hill!"


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Re: Income Tax Hike in Plain Sight

Posted by Jeff A. Taylor at 12:07 AM

Yes but...

The credits are gimmicks that can be easily taken away once the big shift to AGI is in place. Besides, the credit scheme runs directly contrary to the Clodfelter et al argument that the income tax package makes compliance easier and less burdensome. The credits require exactly the same computations as federal taxable income, and then some.

This is why I say the big picture, the actual story on the income side, should be tiny reductions in income tax rates twinned with massive increases in taxable income for most middle-income taxpayers.

Speaking of middle-income, that top rate still kicks in at a whopping $60K of AGI. How very forward looking.

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Re: Income Tax Hike in Plain Sight

Posted by John Hood at 10:59 AM

Jeff,

The tax-hike plan is bad, but it isn’t quite that bad. While the individual income tax computation would start with adjusted gross income, rather than the current “taxable income,” the plan also creates a series of tax credits (typically at 6 percent of household expenditure) for mortgage interest, charitable contributions, catastrophic medical expenses, and a few other items. It also creates a new 0 percent tax bracket, which pulls down everyone's effective tax rate a bit (extent varies inversely with income, obviously).

But your general point is correct. According to the legislative scoring, the income-tax component of the Senate plan will jack up taxes by $265 million in FY 2010-11, the first full year of  implementation, and $344 million in FY 2011-12.

All three big elements of the plan — income-tax changes, sales-tax changes, and business-tax changes — are net tax hikes, of $265 million, $134 million, and $170 million, respectively, in 2010-11.

To get to the net effect of the whole plan, though, you must add in several other items. Smacking smokers with higher excise nets (they think) $123 million. Hitting up drinkers takes $45 million. Complying with federal tax-code changes reduces taxes slightly, by $4 million. And here's a key point: even after the state swipes some additional revenue from the localities, the local tax burden also goes up by a net of $119 million.

Grand total: $860 million in FY 2010-11, the first full year of implementation. But it's a tax “reform,” not a tax increase, don’t you know.

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The Income Tax Hike in Plain Sight

Posted by Jeff A. Taylor at 10:56 AM

This is fascinating.

The meta-story surrounding the tax "reform" proposal -- broadened, lower sales tax, sin tax hikes, income tax rate cuts -- is 1000% wrong.

Real income tax rates are not being cut -- not if they apply to AGI instead of the federal taxable income. And that is exactly what has been proposed.

Rough example: Current code, a family has a federal taxable income of $85,000, gets taxed at 7.75 for a state income tax bill of $6588.

Under the proposed "reform" that family has to add back in mortgage interest and medical expense deductions from their income, to name two big ones. Assume that adds $5000 to their reported income, a reasonable assumption for that income segment.

That would make for an AGI of $90,000 to be taxed at the proposed rate of 7.5, a 25 basis point reduction from the current rate. Follow?

This NC family's new, reformed 21st century state income tax bill would be $6750, or $162 higher than their current bill.

Not reading that anywhere, are you?

Note that almost 70 percent of taxpayers in the above income bracket claim a mortgage interest deduction, about 50 percent of those in the $50K range do. About three-quarters of those making over $100K do. Given that, I have no idea how the GA claims that the income tax rate cuts would be net revenue losers for the state.

The vast majority of state taxpayers -- especially the high earners with big liabilities -- are gonna see their taxable income grow under the proposed racket, er, system.

Do the tea party folks know about this?

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Why you should resist Euro-envy

Posted by John Hood at 09:45 AM

Much of the modern-day “progressive” agenda boils down to making North Carolina and the rest of the U.S. look more like Europe — bigger welfare states, higher taxes, nationalized health care, more trains, fewer cars, smaller houses, etc.

It never made a great deal of sense, given that Americans are wealthier and happier than their European counterparts, on average. You can read the lede of a piece in today's Wall Street Journal to find another compelling reason to resist Euro-envy:

Europe's economy faces a deeper recession and a slower recovery than the U.S. or other parts of the world, making it the region that is most hurting prospects for an early end to the global economic slump.

The EU's economy is set to contract 4% this year, even worse than the 2.8% drop projected for the U.S., according to new forecasts published Wednesday by the International Monetary Fund.

Europe's recession also preceded America's, by the way. 

 

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George Will nails Obama and Duncan

Posted by George Leef at 09:31 AM

George Will has a very hard-hitting column in the Washington Post today on the decision by the administration to pull the plug on a tiny voucher program for poor kids in DC.

The teacher unions have lots of money and clout whereas poor families have virtually none.

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Should we try to amend the Constitution?

Posted by George Leef at 09:14 AM

Writing today in The Wall Street Journal, Georgetown U. law professor Randy Barnett argues in favor of amending the Constitution to pull the fangs of the federal monster that is devouring so much of our liberty and property. Read his article here.

I'm favorably inclined toward making the push for a new amendment part of the strategy for chaining the monster before it completely ruins the foundations of freedom and prosperity. At least, it would be useful in making statist politicians explain why they're against it.

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Should we try to amend the Constitution?

Posted by George Leef at 09:14 AM

Writing today in The Wall Street Journal, Georgetown U. law professor Randy Barnett argues in favor of amending the Constitution to pull the fangs of the federal monster that is devouring so much of our liberty and property. Read his article here.

I'm favorably inclined toward making the push for a new amendment part of the strategy for chaining the monster before it completely ruins the foundations of freedom and prosperity. At least, it would be useful in making statist politicians explain why they're against it.

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Senate's $1.5 BILLION Tax Hike

Posted by Joseph Coletti at 08:54 AM

It's even worse than we thought. Where Gov. Perdue would have raised state taxes $500 million in FY'10 and $667 in FY'11 Gov. Perdue proposed, the Senate raises state and local taxes $618 million and $852 million* in FY'11. So it goes from a $1.2 billion increase over two years to a $1.5 billion increase over two years.

Binker has all the details, including documents and Sen. Dan Clodfelter's 45-minute explanation.

As John Hood suggests this morning, legislators should balance the budget without raising taxes then look at real reform in a better fiscal environment.

*Corrected

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The left's abortion/torture hypocrisy

Posted by David N. Bass at 07:53 AM

Piggybacking off Roy's earlier post about the abortion/torture hypocrisy of the left, here is an interesting take on the same issue by George Neumayr writing in the American Spectator:

Terrorists, we're told by pro-abortion liberals, suffer excruciating pain while the ejected unborn and euthanized elderly feel nothing. And even if the latter do suffer pain, say these liberals, that pain is worth it. After all, abortion and euthanasia sustain a pleasant and peaceful lifestyle for the strong. Let the dead bury the dead. Or, as the Supreme Court has said, imagine the disruption to America's way of life if stare decisis in the case of Roe v. Wade disappeared and women couldn't plan their careers and futures without the expectation of legal abortion for years to come.

Obama's liberalism is not an opponent of human rights abuses but an embodiment of them. The CIA restricts itself to methods far less ruthless than those permitted by the platform of the Democratic Party. When will Obama bring his own platform into line with the Geneva Accords?

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The Halifax County School District gets state intervention

Posted by Dr. Terry Stoops at 07:45 AM

I don't think the state's intervention in the Halifax County Schools will improve student performance. The Roanoke Daily Herald reports,

Activities already have already begun in Halifax but will intensify this summer and in the 2009-10 school year. Clear expectations and direction will be provided to local leadership, principals and teachers, according to the governor’s office.

Three weeks of professional development will be provided to all Halifax principals and central office personnel, and two weeks of professional development will be provided to teachers in the Halifax schools over the summer. This activity will kick off the 2009-10 school year and provide clear expectations and direction for educators in the district and schools.
These activities suggest that the school system employs competent administrators and teachers who simply need to get on the right track. But what if the administrators and teachers are not competent? In those cases, it's hard to believe that professional development, "coaching," and oversight will do much good.

Just in case you were wondering, the Halifax County Schools have the 26th highest per pupil expenditure in the state totaling $9,910 per student (around $1,400 per student higher than the state average). The student to teacher ratio is 15:1.

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Breaking the wind power myth, pt. 4

Posted by Mitch Kokai at 06:55 AM

Readers of the News & Oserver's front page will catch an article about the possibilities for wind power generation on the North Carolina coast.

For another side of the story, see Daren Bakst's work on breaking the wind power myth.

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Today's Carolina Journal Online features

Posted by Mitch Kokai at 06:50 AM

Today's Carolina Journal Online exclusive features Karen McMahan's report about a proposed federal tax on investments.

Speaking of taxes, John Hood's Daily Journal critiques the Senate's proposed "tax reform." 

 

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