Any Business That Doesn’t Want Taxes Cut Can Send the Money to Concord.

On April 14th, the Union Leader ran a story titled, “Diverse coalition urges no cuts in business taxes.”  From the article:

A Peterborough small business owner said the tax cuts will not influence his business decisions.

“I calculated how much these proposals would save my company when they are fully implemented, and it came to less than $150 per year,” said Tom Strickland, president and co-founder of Sequoya Technologies Group, a small IT company with eight employees. “$150 out of a million dollar budget isn’t going to influence my business decisions. I won’t be hiring new employees or buying new equipment as a result of this tax cut.”

What’s stopping Mr. Strickland from sending the alleged $150.00 he would save in taxes to Concord?  Absolutely nothing.  If he believes that it’s better for the State’s economy to send the $150.00 to Concord, he can do so.

Notably, the article doesn’t say how Strickland calculated the $150.00 in alleged savings.  It talks about his $1 million budget, but New Hampshire doesn’t tax budgets.  It does tax profits, so perhaps the business just isn’t that profitable?

The Senate would reduce the business profits tax by .6 percent.  A $150.00 savings suggests that Strickland’s profits are $25,000.00 per year.  Obviously, more profitable companies would see bigger savings.

The most recent data we have on GDP by State is 2013.  It shows that other States are doing far better than New Hampshire at growing their economies:

State.GDP.2013

Strickland claims that New Hampshire’s economy isn’t growing because New Hampshire doesn’t have enough government spending.  But look at this chart:

Migration.NH.2004-20013

When the Democrats took over State government in New Hampshire, and began increasing spending, taxes and regulation, coincides with population outflow from New Hampshire.

The tax cuts proposed by the State Senate are a small step.  They amount to only $80 million out of an $11 billion budget, or less than one percent.  But they are a step in the right direction.

Musings on the First in the Nation Leadership Summit

I didn’t attend.  The weather, except for a rough patch yesterday, was much too nice.  But I kept up on the coverage through the reporting and twitter.  Just a few thoughts.

Jeb Bush – I don’t disqualify him as a  conservative because of Common Core and immigration.  But I’d like to see more fire in the belly.  Are you going to treat an election with Hillary as a friendly tennis match at some country club as your father did when he ran against Bill?  Or are you going to come at it like a political DeathMatch like Hillary will?  The last time you ran a campaign was 2002, I believe.  It’s a whole different ballgame out there.

Marco Rubio – show me the money.  Show me that you are going to be able to raise enough money to be competitive with Hillary’s $2.5 billion.  And how are you going to deal with the one-issue voters we have in our base with respect to immigration?

Rand Paul – loved the way you turned the abortion issue on its head.  But I am not clear where you stand on foreign policy and national defense.

Carly Fiorina – very impressed so far, but when was the last time a candidate who hadn’t held political office, and wasn’t the Supreme Commander of allied forces in World War II, was elected President?  But please keep running.  You are showing the field how it should be done.

Chris Christie – I think you’re right about entitlements, but at this point it is so far down the list of issues that I am wondering what Plan B is and how long until you implement it.

Scott Walker – check out how Rand Paul handled that abortion question.

Lindsey Graham – it would be fun to see a one-on-one debate between him and Rand Paul on national security and foreign policy.

 

Vikings, Season 3, Episode 9

Bittersweet.

The battle for Paris continues with some great action, but the greatest Viking of them all, King Ragnar, is dying.

Lagertha leads a Rambo style commando raid on the bridge to Paris, and manages to burn the gates down.  Which allows the main force, waiting outside to enter.

I’m not sure who is leading the Vikings at this point.  I guess it’s still Floki.  But just when the battle seems lost because the Franks from the safety of the end of the bridge nearest the city are using a big wheel with spikes to run down the Vikings and prevent them from entering the city, it’s Rollo to the rescue.  When the Franks are pulling the wheel back for another death roll, Rollo singlehandedly traps the big wheel using the big spears they had used to open the gates.  And then leads the fight against the Franks, as the wanderer later describes him, like a crazy bear.

It looks like the Vikings are about to break into the city.  But Count Odo pulls him men from the walls and is able to drive the Vikings back.

Count Sigfried is captured during the retreat and Princess Gisla wants his head cut off.  Siegfried says he doesn’t mind dying as long as someone holds his hair out of the way when his head is on the chopping block.  But that Sigfried has quite the sense of humor, and as the blade descends pulls his head back causing the hands holding his hair to be chopped off.  Sigfried finds this quite funny.

But this episode is just as much about the battle Ragnar is waging with death and the battle in his mind between Athelstan and his Christian faith and the Norse gods.  We are left with the impression that the Norse gods prevail, until the very end of the episode.

Count Odo is able to convince the feckless and useless Emperor to negotiate because some disease is killing the people (malaria, perhaps) and the provisions are running low.  Ragnar after leading Lagertha, Rollo, Kalf and Bjorn to believe they will go en masse to negotiate takes the wanderer and goes alone to meet Odo.

Ragnar demands to be baptized in addition to the gold and silver offered by Odo, explaining that he knows he is dying and wants to be able to see Athelstan after he dies.  (Note: it was common in the Roman Empire to delay baptism until near death because baptism washed away all sins, allowing the newly baptized to go to heaven.)

Odo looks to the Bishop who tells Ragnar he will go to hell, and Ragnar approaches the Bishop and tells him that it’s not his decision whether he goes to heaven or hell.  Ragnar obviously was paying attention when he discussed theology with Athelstan.

Lagertha, Floki, Ragnar, Bjorn and Kalf get there just as the Bishop finishes the baptism.  Floki looks like he is about to lose it, while Lagertha and Rollo are dumbfounded.

I could have done without the scenes in Kattegat.  Yeah Aslaug killing the Christian missionary while Ragnar embraces the religion was a valid juxtaposition.  But I would have rather seen a longer battle scene.

In Wessex, Judith jumps in the sack with her father-in-law in order to assure his protection from Aethelwulf.  And we learn that Aethelwulf isn’t as dumb as we thought he was, or at least as I thought he was.  He understands that Ecbert was hoping that Kwenthrith would kill him to give Ecbert a pretext to invade Mercia, and lets Dad know he knows.  But did Aethelwulf really buy Ecbert’s claim that he wanted to pass his kingdom down to him?  He obviously intends no such thing and wants Alfred to inherit.

So now on to the finale.  Who will rule after Ragnar dies?  I suspect that we will have to wait for Season 4 to find out, but I am still really looking forward to Episode 10.  Although it will be very hard to say goodbye to Ragnar.

Will Conservatives Blow a Golden Opportunity?

From Public Policy Polling’s recent release:

If Hassan runs for reelection as Governor instead of for the Senate she’ll start out in a very strong position. We find her leading the trio of Republicans we tested by anywhere from 17 to 30 points- it’s 52/35 over Chris Sununu, 53/36 over Jeb Bradley, and 55/25 over Donnalee Lozeau. If Hassan doesn’t run things look pretty wide open.

“Everything in New Hampshire politics for next year basically hinges on Maggie Hassan’s decision,” said Dean Debnam, President of Public Policy Polling®. “If she runs for the Senate, that race and the Governor’s race become toss ups. If she stays put she and Ayotte are both pretty clear favorites for reelection.”

Governor Hassan has been running for the United States Senate since she became Governor Hassan.  And the Democrats have no Plan B.  I assume if former Governor Lynch had been willing to against Ayotte, there wouldn’t have been this nonstop drumbeat of Hassan for Senate for the last two years and four months.

And after Lynch, there is nobody on the bench capable of defeating Ayotte.  From the PPP poll:

Hassan running may be vital to Democrats’ ability to make the seat competitive. In a hypothetical contest with the state’s Democratic member of Congress, Ann McLane Kuster, Ayotte leads by a 49/38 spread.

Conservatives who believe they can take out Kelly Ayotte in a primary are kidding themselves.  They couldn’t defeat Scott Brown and Ayotte would be in a much stronger position in a primary than Brown was.  For example, from the same PPP poll:

There has been some discussion about a primary challenge to Ayotte by 2010 foe Ovide Lamontagne but she’s not too vulnerable to that, leading him 57/32 in a hypothetical contest. Lamontagne actually does lead Ayotte 53/38 among Tea Party voters, but that’s only 21% of the Republican electorate at this point and Ayotte easily dispenses him with everyone else.

So why waste a good conservative who could be elected Governor in a wide-open race on a fruitless primary against Ayotte.

I know some are of the opinion that it is better to have a Democrat in office than a Republican who doesn’t vote the way they want 100 percent of the time.  But that kind of thinking is a sure path to being a permanent minority party.

But it’s not enough just to eschew a primary against Ayotte.  Conservatives need to get behind an electable conservative in the gubernatorial primary.  Otherwise, if conservatives split the vote between multiple candidates, the nominee will be someone like Jeb Bradley.

Democrat’s Attempt to Spoil Chris Christie’s New Hampshire Visit Backfires

Chris Christie stopped off at Chez Vachon yesterday during his visit to New Hampshire.  According to Politico, a Democrat mega-lawyer began shouting at Christie that he had been stuck in one of the traffic jams on the George Washington Bridge orchestrated by Christies’ aides without Christie’s knowledge.

It turns out, however, that the lawyer, Dick Moquin, wasn’t in Fort Lee in September.  He was there months later, in December.

Yeah, the weather in early September is just so much like the weather in December.  And December also happens to be after the November election, not before.  So easy to confuse the two.

Moquin’s response was, well, Clintonesque:  “I mean, it doesn’t make any difference even if I was in it,”

YouTube Preview Image

I posted here about Christie’s proposal to reform Social Security and the Democrat reaction to it.

No, Funding Mental Health Doesn’t Require an Income Tax. It Just Requires Some Political Will.

The Union Leader ran an editorial today that appears directed at Congressman Frank Guinta’s recent criticism of the House’s budget for not sufficiently funding mental health:

The upward pressure on state government spending is permanent. Every year, interest groups (for worthy and unworthy causes) agitate for more funding, and politicians who want to please everyone find these requests deeply tempting. The federal government does its part by offering cash in exchange for dramatic increases in spending.

Protecting the New Hampshire Advantage — the absence of a broadbased tax — involves politely explaining why the state cannot afford every request. (Someone should remind U.S. Rep. Frank Guinta of this.)

First of all, “the absence of a broadbased tax” is not all there is to the “New Hampshire Advantage.”  The New Hampshire Advantage, as Gordon Humphrey explained when he ran for Governor all those years ago, is that New Hampshire is more free than other States, and that freedom is why people moved here and our economy outperformed the economies of other States.

Certainly the absence of a broadbased tax was part of the New Hampshire Advantage, but the data shows it is clearly no longer enough.  For example, the chart below shows the outflow of people that coincided with Democrats taking complete control of State government in the 2006 midterm elections.  The outflow slowed when the Republicans recaptured the Legislature in 2010, but then picked up again when Maggie Hassan was elected Governor in 2012 and the Democrats also retook the House:

Migration.NH.2004-20013

And why were people leaving New Hampshire in 2013?  Well, as the following chart shows New Hampshire had a walking-dead economy.  It is reasonable to assume that they were leaving for better jobs and opportunity.

State.GDP.2013

What we are doing now is not working.  We have lost the New Hampshire Advantage.  We need tax and regulatory reform so we can compete with other States.

We also need to spend the money that we raise in taxes and fees more wisely.  And this brings me to the Union Leader’s gratuitous swipe at Congressman Guinta.  It is not necessary to impose an income tax or any new tax or raise any existing tax to fund mental health.  As I posted previously:

The House chose to fund “stabilization grants” instead of using the money for better uses such as mental health, the rainy day fund, meals on wheels, community colleges :

Stabilization grants are a lovely euphemism for not reducing state funding for education for towns with declining enrollment, even though the formula for state funding is supposed to be based on per pupil cost.

If Republicans won’t modify State spending on public education to reflect declining enrollments, one really has to scratch one’s head.

I understand that the “stabilization grants” are $30 million. To the extent that more funding is needed in areas like mental health, the rainy day fund, meals on wheels, and community colleges, it’s time to take on the third-rail of New Hampshire politics, education funding:

But shouldn’t the Education Trust Fund be used just for education? In response to that question, I ask: Why do we need to spend more on public schools every year when enrollment is declining?

According to the New Hampshire Department of Education, we had around 197,000 public school students in 2003-2004. In 2013-2014? The number is down to about 180,000.00.

In 2003-2004, per the Department of Education, we spent around $8,500.00 per student. In 2013-2014? The number is about $14,000.00.

So we spent around $1.7 billion in 2003-2004 to educate 197,000 students. And in 2013-2014, we spent $2.5 billion to educate 180,000 students. That’s an increase of approximately 4.7 percent each year, notwithstanding declining enrollment.

To be clear, the figures above include local as well as State funding. But the “Education Trust Fund” was approximately $1.9 billion in the prior budget (fiscal years 2014-2015).

Some of this money can and should be spent on mental health, the rainy day fund, meals on wheels, and community colleges. We don’t need to raise taxes. We just need to take on the third-rail of New Hampshire politics.

Was It Too Early For Christie To Throw a Hail Mary?

Trick question.  Governor Christie did not throw a Hail Mary today in New Hampshire when he addressed entitlements.  I wasn’t there and haven’t seen it, but I understand what he proposed is:

Christie’s plan would transform Social Security into an insurance policy — scaling back payments to seniors earning more than $80,000 annually, and eliminating them entirely for individuals with salaries exceeding $200,000. Christie also proposed expanding means testing for Medicare and raising the eligibility age for Medicare and Social Security, among other changes.

A Hail Mary would have been proposing to replace Social Security with private retirement accounts.  What Christie proposed are pragmatic reforms that should be noncontroversial.

But that didn’t stop the New Hampshire Democrats from immediately attacking him:

Sullivan.14APR15

Newsflash:  If an individual’s 401K and/or pension are generating $200,000.00 of income annually, he or she is not middle class.  But don’t take my word for it.  In 2012, when the debate about letting the Bush tax cuts expire was taking place, the Democrats defined the rich as an individual making over $200,000.00.

But what about the people making between $80,000.00 and $200,000.00?  Well, according to the U.S. Census, the median household income in New Hampshire is $65,000.00.  Christie is talking about scaling back social security for individuals, not households, beginning at $80,000.00.

When it comes to taxes, the Democrats are all for progressivity.  The “rich” need to pay more.  But when it comes to spending, progressivity goes out the window.   Means testing for Social Security.  The horror of it:

Egads, Lovey we may have to dip into one of our IRAs to pay for that second European vacation I was planning next year.  They can’t expect us to live on my six-figure government pension and your seven-figure 401K.  It’s draconian.

Raising taxes on the “rich” to pay for social security as opposed to means testing creates a disincentive for current workers to work.  It would push the marginal tax rate to over 60 percent.  How did that 75 percent tax bracket work out for the French?   The result would be lower economic growth, which means less good paying jobs and opportunity for upward mobility for middle and lower income Americans.

The Democrats have also argued that means testing Social Security would convert it into a welfare program:

Sullivan.15APR15

But Social Security is not like a 401K or an IRA, where the individual funds it himself or herself and then withdraws his or her own money.  Rather, the way that Social Security works is that you get a “benefit” based upon your retirement age and an average of what you earned over your career.  That “benefit” continues as long as you live.  In contrast, withdrawals from a 401K or IRA are limited by the amount that you contributed and the return you earned on those contributions.

In other words, Social Security is already a welfare program because you are not receiving a benefit based on your “contribution.”  Limiting the eligibility of Social Security does not make it into a welfare program, it simply reduces the cost of that program for the people paying for it, current workers.

Democrats’ Attacks on House Budget Shallow and Unhelpful

Governor Hassan has proposed a budget for the next two fiscal years, 2016 – 2017 (July, 2015 – June, 2017).

Hassan.Proposed.Budget

The House has “cut” the Governor’s budget in the sense that instead of raising spending by the approximately $1 billion proposed by the Governor, it only raised spending by about $700 million.

And now the Senate is taking its turn.  And what is going to happen is that the Senate is going to use “updated” revenue estimates that -surprise, surprise- are higher than the House’s and reduce or eliminate many of  the “cuts” that are not really cuts in the sense that people in the real, as opposed to the political, world understand cuts.  “Hey honey the boss just cut my pay.”  “Oh dear how much?” “Well, I asked for a 10 percent raise, and he only gave me a 7.5 percent raise, so 2.5 percent.”

There is plenty to criticize in the budget passed by the House.  I have argued here and here that it spends too much on K-12 public education and not enough on things like mental health, meals on wheels, and community colleges. But one cannot criticize the budget on the ground that it cuts overall spending.

Yet that is exactly the impression that a recent opinion piece from Democrat Representative Cindy Rosenwald gives.  Nowhere in Rosenwald’s opinion piece does she discuss the overall budget numbers I discuss above.

Rosenwald identifies various areas where she believes more spending is warranted.  We actually agree on some of those areas.  The difference is that I identify how to spend more in these areas without raising taxes.  She doesn’t.  Which suggests that she wants to raise taxes, but isn’t willing to say so.

This is not in the least helpful when the Senate has ruled out tax increases.

Some comments on some assertions Rosenwald makes in her opinion piece.  First, the so-called Renewable Energy Fund:

In a dazzling money grab, this budget raids $51 million dollars from the Renewable Energy Fund. This money, collected from ratepayers, is dedicated to helping municipalities, businesses and individuals lower their energy costs. 

The Renewable Energy Fund is a scheme where lower and middle income ratepayers are charged higher rates in order to subsidize businesses and higher income individuals using uneconomic forms of energy, such as solar.  It is crony capitalism:

The “renewable energy fund” is, pardon the pun, fueled by a hidden tax on electricity. This tax disproportionately effects middle class and lower income people because they pay a higher proportion of their incomes on electricity. Money is dispensed from the “renewable energy fund” to more affluent people and businesses to help them, for example, buy solar panels. It’s Robin Hood in reverse.

The House’s budget leaves a lot to be desired, but this is one are where the House got it exactly right. The money in the Renewable Energy Fund is better spent maintaining the roads that everyone uses than subsidizing some millionaire who wants to install solar panels on his Lake Winnipesaukee dacha.

Second, not continuing Obamacare Medicaid Expansion:

Our business community has been clear that they need a healthy workforce and they are sick of the impact on their insurance premiums that comes from uncompensated care costs. The failure to extend the New Hampshire Health Protection Plan breaks our promise to help reduce uncompensated care. It also leaves almost 40,000 Granite Staters out in the cold when their insurance is cancelled next year.

This is a total canard.  As I previously posted:

Bradley claims that Medicaid Expansion is “working” because it has stopped the use of emergency rooms for uncompensated medical care, which he claims was the driver of high healthcare costs in New Hampshire. So, according to Bradley, we should continue Medicaid Expansion because even with the drawdown in federal funding New Hampshire is still saving money.

Apparently Bradley is unaware that the claim that use of emergency rooms by the uninsured is driving up healthcare costs is a myth. It’s one-half of one percent of total healthcare spending.

Guinta Shows Leadership on State Budget

The budget passed by the House increases spending by hundreds of millions.  Even in the so-called General Fund category of spending, which is supposed to represent non-dedicated State taxes, spending is up.  According to one think tank by at least five percent, or $150 million, and by $109 million according to another.

Congressman Guinta recently criticized the budget for not spending enough on mental health:

In an interview, Guinta reiterated his criticism of the budget produced by the Republican-controlled House. “I’m angry, I’m frustrated, I’m appalled,” he said. “The mental health patients in this state are not being treated properly.”

There are other areas where the House’s budget also falls short.  I discussed those in a previous post:

The Senate’s budget needs to adequately fund the “Rainy Day” fund, which the House’s budget essentially emptied. And it also needs to adequately fund Meals-on-Wheels.

I understand that some have reacted to the Congressman’s criticism by charging that he is not a fiscal conservative.

A budget that increases spending by hundreds of millions of dollars is hardly a conservative budget.  But I don’t see the Congressman calling for a tax increase.  I assume that he is saying what I have said, which is that the priorities in this budget are misguided.

The House chose to fund “stabilization grants” instead of using the money for better uses such as mental health, the rainy day fund, meals on wheels, community colleges :

Stabilization grants are a lovely euphemism for not reducing state funding for education for towns with declining enrollment, even though the formula for state funding is supposed to be based on per pupil cost.

If Republicans won’t modify State spending on public education to reflect declining enrollments, one really has to scratch one’s head.

I understand that the “stabilization grants” are $30 million.  To the extent that more funding is needed in areas like mental health, the rainy day fund, meals on wheels, and community colleges, it’s time to take on the third-rail of New Hampshire politics, education funding:

But shouldn’t the Education Trust Fund be used just for education? In response to that question, I ask: Why do we need to spend more on public schools every year when enrollment is declining?

According to the New Hampshire Department of Education, we had around 197,000 public school students in 2003-2004. In 2013-2014? The number is down to about 180,000.00.

In 2003-2004, per the Department of Education, we spent around $8,500.00 per student. In 2013-2014? The number is about $14,000.00.

So we spent around $1.7 billion in 2003-2004 to educate 197,000 students. And in 2013-2014, we spent $2.5 billion to educate 180,000 students. That’s an increase of approximately 4.7 percent each year, notwithstanding declining enrollment.

To be clear, the figures above include local as well as State funding.  But the “Education Trust Fund” was approximately $1.9 billion in the prior budget (fiscal years 2014-2015).

Some of this money can and should be spent on mental health, the rainy day fund, meals on wheels, and community colleges.  We don’t need to raise taxes.  We just need to take on the third-rail of New Hampshire politics.

So Far, a Disappointing Rivalry

Well Bill Binnie apparently got under WMUR’s skin when he suggested that his NH1 News has made WMUR get better at covering New Hampshire.  Good for him though.  There is nothing wrong with a little competition.

Bill Binnie is an impressive person.  An incredibly impressive person.  Putting himself through Harvard by working nights.  Going on to become a multi-millionaire.

Maybe it’s because of his track-record that I’m disappointed with NH1 News, or to be more accurate its political coverage.

My gripe is that it is not really that different from what we were getting from WMUR.  Not MSNBC, but a clearly left-of-center perspective.  Indeed, in some respects, and I’m referring to Kevin Landrigan, it is a very left-of-center perspective.