The More You Tax Something, the less You get of It

From the time I was 16 I was passionate about the future freedom of our country. Early on I came across a book entitled An American Renaissance, by then Congressman Jack Kemp. Kemp was an early architect of Reaganomics and an important soldier in the "Reagan Revolution."

One of the concepts conveyed in that book is that "the more you tax something, the less you get of it." Also, "the more you subsidize something, the more you get of it." Those simple words are at once a "no kidding" moment and, at the same time, really quite profound. That philosophy was being thoroughly violated in the world of Government in the 1970s under Jimmy Carter and it is all the more so the case in the world we live in today.

The New York Times Headlines states that "Jobless Rate Hits 8.5% as March Payrolls Fall by 663,000." This headline has followed months of business owners voting with their pink slips at the election results of last November. This is due to the fact that candidate Barack Obama made it perfectly clear that he intended to raise taxes on job creation.

Because of the Democrat's control of the Congress and the position of Obama, President Bush's tax cuts were not renewed. Those cuts had a direct effect on those who create jobs. Because of the failure to renew those cuts there was a marked increase in the Capital Gains tax, which will significantly undermine the economic activity that leads to more jobs. Than there is Obama's own proposal to dramatically increase the taxes of those who make $250,00 or more a year -- the very people who create most of the jobs. Add the many other taxes and regulations (which are very similar to a tax in their results) they are adding on the economy and we have a government waging a war on employment.

So Obamanomics are increasing unemployment by penalizing job creation, so what is it subsidizing? A great place to look is Obama's recent pork package also known as "stimulus" and the impact it would have on the various states, such as Mississippi. According to Fox News, Obama's measure would force states to allow people to receive welfare, even if they are not willing to work. For example, Barbour noted, that if the state of Mississippi wants to receive $54 million in increased unemployment benefits, they will have to expand the benefits to those not actively looking for employment or willing to take employment if offered. Barbour's decision not to take it led the state to receive less than $4 million of the expanded benefits.

In sum, Obama is taxing employment and subsidizing unemployment. The current headlines could be many things, but not surprising.

Kevin Price is Host of the Price of Business, the longest running show on CNN 650 (M-F at 11 am), AOL Radio, and CBS Radio. Eric Bolling of Fox News and Fox Business says that Price’s Blog “is very influential and moves the blogosphere.” Steve Moore of the Wall Street Journal calls Price the “best business talk show host in the country.” Find out why and visit his blog at www.BizPlusBlog.com and his show site at www.PriceofBusiness.com.

Obama takes from Vets to Expand Welfare Rolls

If it were any other President at any other time, I would be shocked. For Barack Obama, the latest announcement is nothing more than business as usual. Recently, members of the Obama administration (including the President) met with members of several veteran organizations, including the largest of such groups -- The American Legion. Leaders of that organization are up in arms because of what they heard and it is for good reason.

In a press release from the organization, we learn that the leader of the Legion (Commander David K. Rehbein) is "deeply disappointed and concerned” after a meeting with President Obama today to discuss a proposal to force private insurance companies to pay for the treatment of military veterans who have suffered service-connected disabilities and injuries. The Obama administration recently revealed a plan to require private insurance carriers to reimburse the Department of Veterans Affairs (VA) in such cases. " The release goes on to point out that Obama "is looking to generate $540-million by this method, but refused to hear arguments about the moral and government-avowed obligations that would be compromised by it."

Finally, the Legion points out that "This reimbursement plan would be inconsistent with the mandate ‘… to care for him who shall have borne the battle…’ given that the United States government sent members of the armed forces into harm’s way, and not private insurance companies." To saddle private insurance companies with this cost could lead to discrimination towards those who served in the military when they consider covering vets. Furthermore, since policy have financial limits, this policy could take away coverage for other family members who might need it. On a broader note, many fear this type of policy is part of Obama's larger objective to burden private insurance companies with higher costs in order to weaken them as part of the Administration's on going objective to make a case for socialized medicine. Insurance companies will be forced to raise premiums in order to pay for this additional liability. Obama will point to this situation as an indicator of inefficiencies among insurance companies.

The irony is that, while Obama is trying to increase the burden of those fighting men and women who have protected our country, this Administration is also pressuring governors to increase the welfare rolls by allowing people who are not even seeking employment to receive benefits. For example, Gov. Haley Barbour noted, that if his state of Mississippi wanted to receive $54 million in increased unemployment benefits from the Obama "stimulus" package, they will have to expand the benefits to include those not actively looking for employment or even willing to take a job if offered. If Barbour didn't take it, he will receive only 4 billion of the expanded benefits. It is clear why governors would be resistant to such a bizarre policy approach. Obama is single handily restoring the welfare policies that wereso pervasive before 1996, when a bipartisan approach was used to reform a system of economic dependency.

Obama wants to harm our veterans and benefit those who will not work. What a strange world we live in today.

Kevin Price is Host of the Price of Business, the longest running show on CNN 650 (M-F at 11 am). Eric Bolling of Fox News and Fox Business and says that Price’s Blog “is very influential and moves the blogosphere.” Steve Moore of the Wall Street Journal calls Price the “best business talk show host in the country.” Find out why and visit his blog at www.BizPlusBlog.com and his show site at www.PriceofBusiness.com.

Obama Wants to Restore Welfare "As we Knew It"

Hidden in the media coverage about Barack Obama is the eloquent argument being made by Republican Governors regarding their concerns over the stimulus package. The media believes that these politicians are jockeying for higher office. The truth is, most are opposed to the massive growth of the federal government and are particularly concerned about the bill's various "hitches" designed to force states to take positions that they are opposed to. Worse than being critical about these governors, many in the mainstream media are ignoring them entirely.

Robert Schlesinger has noted at US News and World Reports that the New York Times reviewed the views of GOP candidates and their thoughts on Obama's stimulus package and stated that "in terms of presidential politics, the most notable name in the Times piece is Florida Gov. Charlie Crist, who campaigned with Obama for the stimulus package last week. Glaringly absent from the Times piece were governors like South Carolina's Mark Sanford, Louisiana's Bobby Jindal, Mississippi's Haley Barbour and Alaska's Sarah Palin—all governors recently named in the Washington Post's excellent 'The Fix' column as being among the five most influential and powerful voices in the Republican Party (the other person named was former Massachusetts Gov. Mitt Romney). Palin and Jindal are often named as contenders in 2012, and Barbour gave 2008 a long look before passing on it. Sanford is chairman of the Republican Governor's Association."

Haley Barber has been particularly persuasive in discussing his concerns, stating on Fox News that the Obama measure would force states to allow people to receive welfare, even if they are not willing to work, if they want to enjoy the complete package. For example, Barbour notes, that if the state of Mississippi wants to receive $54 million in increased unemployment benefits, they will have to expand the benefits to those not actively looking for employment or willing to take it if offered. If Barbour doesn't take it, he will receive less than $4 million of the expanded benefits.

We haven't seen this kind of pressure on the restoration of the Welfare State since Bill Clinton and Republicans in Congress led the efforts to reverse many of the damaging policies that led to multi generational poverty. I consider that to be one of the the greatest policy achievement of the 1990s. This achievement is threatened as the Obama policies are implemented in the states.

Kevin Price is a syndicated columnist whose articles frequently appear at ChicagoSunTimes.com, Reuters.com, USAToday.com, and other national media. Kevin Price is Host of the Price of Business (M-F at 11 AM on CNN 650) and Publisher of the Houston Business Review. Hear the show live and online at PriceofBusiness.com. Visit the archive of past shows here.