Mr. Obama, Just Create One Job

President Obama is all about job creation. Although if you look at the fine print of the legislation he’s proposing, it mostly serves to shore up government employment–essential workers like firefighters, police officers and teachers. (My kids would argue with whether teachers are essential, and quite frankly, so do I.)

The President intends to fund this half-billion-dollar experiment by taxing employers personally. In other words, he’s robbing Paul to pay Paul.

President Obama, I know your intentions are sincere–that you’d like to see more people back to work, especially people who vote Democratic (the state workers ). And I know that you have serious doubts about the morality of the private sector, so you’d like to see more and more people employed by the government.

But I’ll tell you what would make me really happy.

Instead of trying to create millions of new jobs, just create one.

Yours.

Your presidency has been nothing short of mystifying.

You have presided over the greatest economic meltdown in eighty years, which you sought to “solve” by printing up billions of dollars, handing it over to your supporters, to strengthen the pension funds of state workers.

Not to mention the balance sheets of banks that, once they got money, refused to lend it.

Abroad, you took a sledgehammer to our already-fragile standing in the community of nations. Who can forget those excruciating and humiliating deep bows that you made to the emperor of Japan and the leader of Saudi Arabia?

Commentator Dinesh D’Souza came up with the best interpretation for your desire to take the syllables “super” out of “American superpower.” D’Souza posits that you are simply fulfilling the agenda of your father, who hated colonialists and wanted to cut them down to size.

To quote George W. Bush, “Mission accomplished.”

I understand that you grew up in straitened economic circumstances, and maybe that’s why you like to play poor-mouth with the American people. But a lot of presidents grew up impoverished–Nixon, Reagan, Lyndon Johnson, and Bill Clinton, to name a few–and yet each of them recognized that business is the engine of growth in our society, a lesson somehow lost on you.

I don’t doubt your intellectual abilities. You attended my alma mater, Columbia University, and while you were there, you are said to have read a very large number of books about socialism.

My sense is that, given your apparent hatred of private business, you never read any of those books on socialism all the way to the end.

Your guardianship of our nation has been more moronic than Platonic.

You promised to end wars, and yet the wars, which we can’t afford, rage on.

You promised to shut down Gitmo. I know you’ll get around to it soon. Unless you’ve decided to move from waterboarding those bad guys to offering them a path to citizenship.

Maybe I’m just bitter. Maybe I’m just one of those small-town Americans who clings to his religion and his guns, as you told that clubby little set in San Francisco in an unguarded moment during a campaign.

To take you back even further, when you came off the stage after your triumphant speech at the 2004 Democratic National Convention in Boston, you proclaimed, loud enough for reporters to hear, “I’m LeBron, baby!”

You got that one right. You took your talents to Washington, just as LeBron took his to South Beach, and you both lost. At least LeBron knew when to stop shooting in the fourth quarter. At least he knew to quit asking for the ball.

You must have had a ball yourself, Mr. President, these last few years, diminishing America at home and abroad, pursuing an agenda that could best be described as anti-American.

I saw your new campaign slogan–“Let’s change the world again.”

Enough already. For most Americans, the only change you’ve created…is spare change.

Create one job. Resign. Give it over to Joe. (Biden, not Stalin.) Or even let Hillary take over.

In that sense, you’ve done the seemingly impossible. You’ve made conservatives nostalgic for a President Hillary.

Like most Americans, I don’t understand how taxing the people who create jobs will create jobs. It’s time we had a grownup running the country again.

In 2008, you campaigned on a slogan of, “Change we can believe in.”

Hit the road, Mr. President. That’s the only kind of change your fellow Americans could possibly believe in now.

(New York Times Bestselling Author Michael Levin runs www.BusinessGhost.com, America’s leading provider of ghostwritten business books.)

Cronyism and Mitt Romney’s Massachusetts Healthcare Legacy

Cronyism Is Endemic in Contemporary Politics

“Cronyism.” That word is likely to be thrown around a great deal over the coming months in the Republican primary battle. Cronyism is bad when, for example, it’s done to lure companies to locate in a particular state, but it’s worse when used to increase government intrusion into people’s lives. That’s what happened when former Massachusetts governor Mitt Romney pressed to get support for his health care plan, the widely acknowledged model for Obamacare.

According to a 2008 report by The Heritage Foundation, at the time of Romneycare’s passage the two largest safety-net hospital systems in Massachusetts—Boston Medical Center (BMC) and Cambridge Health Alliance (CHA)—had “become dependent on direct subsidies” and were concerned that, even accounting for the significant rate increases allowed under the new law, a shift to Medicaid managed care would hurt their bottom line.

To get the law passed, Romney and his allies agreed to a host of annual payments—including “MCO supplemental payments,” “disproportionate share hospital payments,” and special “hospital supplemental payments,” targeted just for the two systems. At the last minute, more than $540 million in so-called “Section 122 payments” were inserted into the law, designed to supply BMC and CHA with an even bigger financial cushion over the next three years.

In practice, these funds—which included federal, state, and local taxpayer money—served as direct subsidies for the two providers’ expansion. According to MIT Professor Jonathan Gruber, “The federal government was essentially supplementing the expansion of these inner city hospitals.” When some lawmakers suggested cutting back on the amounts, provider officials complained about all the great programs they’d have to shut down—such as BMC’s “food pantry.”

As it turned out, the cost of these subsidies made the difference for Romneycare’s financial stability, at least in the short term. As the system faced higher than expected enrollment, the Section 122 payments forced Massachusetts to prioritize more money for the required earmarks to BMC and CHA—money that might otherwise have been used to cover costs of patient care. According to The Heritage Foundation, in 2008 “Section 122 payments come to $180 million, while Commonwealth Care overruns are $153 million. … In effect, the state was subsidizing institutions, not patients.”

In the long run, the institutional subsidies and ever-increasing costs of coverage—Massachusetts’ premium costs have skyrocketed since Romneycare’s passage and are now the highest in the nation—are taking their toll on the fiscal sustainability of Romney’s plan. The latest estimates indicate that over the next decade the law will cost $2 billion more than Romney and his allies predicted.

Such corporate cronyism abounds in government today. When states are competing for new jobs from prospective employers, governors of all political stripes use special favors to try to woo business to their state. Nearly all governors have slush funds of various sizes to deploy for such occasions, consisting of tax abatements, credits, and other incentives.

These favors don’t deliver public benefits. After all, if Texas’s roughly $200 million slush fund were the reason the state has produced four of five net new private-sector jobs in the United States in the past five years—with 88 percent within the past two years coming from the private sector—every state would have similar success in job creation.

There’s a right way and a wrong way to try to attract jobs. The right way is by ensuring a transparent legal and regulatory environment, with low taxes and a solid educational system, and creating an educated populace well prepared to fill jobs for generations. The wrong way is by picking winners and losers directly in the halls of government—preventing competition, rewarding rent-seeking behavior, and enshrining into law direct transfers from the taxpayers to corporations.

This is a lesson the federal government could stand to learn, along with state and local governments. Creating a friendly climate for business and job creation takes a lot more than writing a check with somebody else’s money.

 

(Benjamin Domenech ([email protected]) is a research fellow at The Heartland Institute and managing editor of Health Care News.)

Steve Jobs for Governor?

We bought 500 shares of Apple stock in 2005 at $40 a share.  Today those same shares, still in our account, hit $422.  That is all that really needs to be said about the genius of California’s Steve Jobs.

Jobs is probably responsible for more “jobs” in California than most living politicians here.  Certainly more than Barack Obama.  Born in San Francisco and based in Cupertino, he is certainly responsible for more wealth in this state than just about any other one person.  He co-founded Apple computer company in 1976, and over time invented a great computer operating system, along with the iPod, the iPhone, the iPad; created the iTunes Library, invented Apple TV (the next great leap in technology will dovetail off this invention) and made huge advances in pictoral animation through Pixar Animation Studios, which created such wonderful films as Toy Story, A Bug’s Life, Monsters, Inc., Finding Nemo, The Incredibles, Cars, and Ratatouille.  (He also inspired Cars II but that one we won’t talk about.  Nobody is perfect.)

I don’t know anything about Steve Jobs’ politics.  I know he was adopted, studied Buddhism (hey, I was raised in the Bay Area, I can handle it), and told a graduating class at Stanford that he didn’t complete college because he didn’t want to waste his parents’ money.  Wow!  I don’t need to know much about Steve Jobs’ politics to know I like him and think the world has been made very much better by him.

Jobs career could have been over when the Apple board decided to side with outsider business manager John Scully to lead the company, which was subsequently almost run into the ground.  But in 1996, Jobs returned to Apple and seized back operational control in September, 1997.  Already a multi-millionaire, he didn’t need the work.  But he loved to create, and his creations had the affect of building wealth, jobs, and doing more for our economy than any government hand-out program a liberal Democrat might dream up.  Today, all one needs do to bask in Jobs glow is visit your local Apple retail store.  It will be packed, not only with great devices, but people; and in the middle of a great recession.  Apple is a hugely successful company, has no debt, and at one point this month had more cash on hand than the Federal government.  Today it is worth in excess of $300 billion, and is competing with Exxon-Mobil for the right to say it is the most valuable company on the planet Earth.

On August 24, Jobs wrote a letter to staff and shareholders stating that he could “no longer meet duties and expectations as Apple’s CEO.”  He had received a liver transplant in 2009, but health problems persisted.

As a fairly seasoned political observer and someone who worked throughout the eight years of the Reagan Administration in senior executive positions in the Federal government, I’ve known first hand how government really works, day-by-day.  And I’ve heard a lot of politicians talk about how government should operate “more like a business.”  None of them, even Ronald Reagan, have been thoroughly successful in making government more efficient and responsive, as if it “were a business.”  We’ve had plenty of business people, and Hollywood celebrities, and “community organizers,” elected to high government positions, but the net result today is financial chaos and among the highest unemployment rates in our nation’s history.  And all the time Apple was growing explosively under Steve Jobs, with no debt.

I’ll bet that Steve Jobs would have been a great Governor of California.  But I think he has done just fine, even better for California, our nation, and the world, as simply the leader of Apple Computer.  He has had more impact in the private sector than any elected official.  Perhaps there is a lesson there for those earnest and talented young men and women in our state who aspire to create and lead.

“Peacenik” Ron Paul crowd reminds of SDS

For those of you too young to remember, Students for a Democratic Society (SDS) was the premier leftist “pro-peace in Vietnam” student group of the 60’s founded by Tom Hayden (famous for disrupting the 1968 Democratic Convention in Chicago) and like-minded radicals of the “hate America first, last and always” crowd.  Anyone who went to college from the mid 60s to mid 70s could count on the SDS to be burning American flags, campaigning for “peace”, victory for the North Vietnamese Communists and blaming American policy for Soviet imperialism.

I thought I had seen the last of these types until I did some people watching at last weekend’s California GOP convention in downtown Los Angeles.  I can report that the SDS lives, and its spiritual heirs wear “Ron Paul for President” buttons.

California Political Review’s exhibitor table at the convention was directly in front of the line for people participating in the Presidential straw poll, so just about everyone who voted passed in front of our table and my eyes.  It actually made for fun people watching until the Ron Paul great unwashed got off their pre=paid chartered busses and queued up to vote.

Let me say that a goodly portion of Paul supporters seemed like pretty ordinary Republicans.  However a very large minority of them, and perhaps an outright majority, appeared to me to be SDS remnants and complete strangers to the Republican Party. The…uhm…young lady with the mostly shaved head and bright purple Mohawk on top was an attention getter, if not a vote getter. So was the young Paul voter sporting the “Che Lives” button on his belt.

Particularly offensive to me were the signs saying “I’m voting for PEACE – Ron Paul for President”.  Flashback 40 years to my studentship at the nearby University of Southern California, where anti-war and anti-American demonstrations and the protesters’ signs would have been exactly the same, substituting only the name of “peace” candidate for President Eugene McCarthy for Ron Paul’s name. Other Paul signs and stickers were born by folks whose vast majority of exposed skin was covered with tattoos or wearing black berets (perhaps as a tribute to radical Black Panther Leaders Huey Newton or Eldridge Cleaver?).

Okay – so looks can be deceiving, you can’t judge a book by its cover…yada, yada.  Well, it happened that an old friend of mine and GOP activist was among the Paul supporters in line.  We chatted briefly and I asked him if he really thought the U.S. Government had a direct hand in blowing up the twin towers on 9/11.  His response was, “I don’t know”. I was literally speechless for about 30 seconds, then asked him if he really, really thought Dick Cheney and Don Rumsfeld could be responsible for such an act.  His response was “it didn’t have to be them directly, it could have been other people in the government”.

Cue the theme from “Twilight Zone”. Ron Paul’s economic views largely parallel mine.  His foreign policy views largely parallel those in power in Pyong Yang and Caracas.  The SDS would find little to disagree with. Those views frighten me – and a good slug of his supporters at the convention last weekend, whose registrations were all paid in advance for the sole purpose of boosting Paul’s straw poll vote, should frighten all Republicans.

Citizen’s Redistricting A Lot Better Than Backroom Deal Making

Over the last couple of months, much has been made of the historic Citizen’s Redistricting Commission process in California. This process, established by a majority of California voters when they passed both Proposition 11 and Proposition 20, took the power to draw their own districts out of the hands of the politicians and put it into the hands of a commission of citizens.

Was this process perfect? Anyone paying attention over the past couple of months would tell you “no, it was not” – and truthfully it is unrealistic to expect any process as politicized as redistricting to be. But that is not the question we, especially Republicans, should be asking ourselves. The real question is did this process yield better results than one managed fully and completely by the majority Democrats in the Legislature and Democratic Governor Jerry Brown? I think the answer to that is, “yes.” We have been there, done that 10 years ago when the Legislature and then-Governor Gray Davis drew the lines in a highly politicized and retributive process. Republicans clearly didn’t gain under that scenario; in fact we have lost seats over the last 10 years.

Now, I understand the definition of “better results” clearly is a function of what the very subjective term “better” means to you and furthering your policy and political goals. Certainly the State Senate maps prove problematic from the perspective of Senate Republicans and fortunately, Proposition 11 preserved the right of the people of California to hold the commissioners accountable for their work on those maps through a referendum. That is a good and healthy stopgap that was included in redistricting reform and Republicans are well within their rights to challenge those maps.

But if we pause to think of the nightmare that would be before the Republican Party had the Democrats, who hold firm control of both houses of the Legislature and the governor’s office, drawn the lines, it becomes clear that things could be a whole lot worse.

Can you imagine simultaneously negotiating a budget and new district lines with the Democrats in full control?  Imagine the added political advantage the Democrats would have had in that situation.  If you think cutting office budgets, like Speaker Perez did to Assemblyman Portantino, is bad, imagine what could have happened if the same politicians were in charge of drawing “competitive” district lines for legislators who refused to vote for a bad budget or tax increase?  I cannot imagine a scenario where that would have netted a better outcome for the GOP.

Ten years ago when the Legislature and Governor controlled this process, the Legislature worked hard to create an aura of a public process by holding a couple of hearings on the maps. After receiving public feedback, the maps weren’t changed.  Why?  Because the hearings were just pro forma; politicians had already come to an agreement without any input from the public. The maps were passed. The districts set. The incumbents safe.

The truth is that as I continue to examine these districts I am seeing that it’s not just that it could have been worse if the Democrats had controlled the redistricting process, but that the districts drawn by the commission actually give Republicans a shot at picking up some seats. For example, Republican Senate candidate Carly Fiorina carried 31 of the new Assembly seats but there are currently only 28 Republican Assembly members. Carly carried 17 of the new Senate districts while under the current lines there are only 15 Republican Senators. That tells me that with good candidate recruitment and the right messaging and resources, Republicans have the opportunity to gain at least three seats in Assembly and two seats in the Senate.

The new districts might not satisfy everyone.  It’s a compromise approach; there’s an expectation that not everyone would be happy.  But this process was better than the alternative – and could provide Republicans with a path to making some electoral gains, for the first time in 10 years.

 

(Julie Soderlund is a Republican Political Consultant and Partner at Sacramento-based Public Affairs Firm Wilson-Miller Communications, Inc. She served as a communications consultant to the campaign to support Proposition 11.)


Time to End the Post Office

I’m not one to gloat over the misfortunes of other people, but there is some rich justice in the oncoming financial collapse of the U.S. Postal Service. It’s about time for them to have to stand in line and wait for a government bailout, given the collective millions of hours they’ve made Americans stand in line just to buy a stamp.

The post office certainly faces huge problems–the responsibility to deliver mail six times a week to every address in the country, the inability to set its own rates, and the inability to go into other businesses, as do postal services in other countries. But the real problem with the post office isn’t any of these things.  The real problem:  it’s run by the government.

Case in point. A government agency whose name I won’t mention (it rhymes with Liar Mess) was trying to send me a certified letter the week before last. They left a slip in my home mailbox so that I could sign for the letter. I studied the card. Remarkably, there was a forty-digit number assigned to the package–which had been written out in longhand. Don’t they have computers at the post office? What are they, medieval monks?

I thought it would be faster if I sent my assistant to the post office to pick up the letter in person. There’s a space on the form where you can sign for an “agent” to do just that. So she took the signed form to the post office, and they refused to give her the letter, on the grounds that a lot of people discover these notices, perhaps by combing through other people’s mail, come to the post office, and pick up the packages.

What’s the point of having a box that says that an agent can pick up your package if you won’t actually give the package to the agent?

What’s the point of having a tracking system if the tracking numbers are forty digits long and written out by hand, which is a recipe for making errors if there ever was one?

What’s the point of having a post office in an era when 99 percent of mail is either bills or junk mail, which is subsidized by your tax dollars?

As a kid, I was a stamp collector, and experienced the romance of stamps from other countries and other eras. I was fascinated by the evolution of stamp design, the subjects that stamps commemorated, and the stories stamps told about blimps and jets and national parks and presidents and everything else they contained.

But the problem with stamps is that they go on envelopes, and the problem with envelopes is they have to go to the post office, and the problem with the post office is you have to stand on line.

I’m not averse to standing on line once in a while, but the problem with standing on line in the post office is the sense that the people there just don’t care about us at all. They see us as intrusions on their own personal roads to retirement. And now, some of those retirements are about to be rudely interrupted by the fact that the federal government cannot afford to fund the lavish pension schemes that they were counting on.

We live in an era of economic pain, and there’s no reason why government workers, past or present, should be exempt from pain. President Obama’s new jobs initiative takes pains to exempt government workers from the pain that we non-government employees face every day.

This is not fair.

Can we contemplate a world without post offices? Sure, why not? Any time the government gets out of a business, private firms swoop in and compete, on price and quality–two concepts that mean nothing to the government–to grab the business the government has left behind. I’ve never had a problem getting FedEx on the phone when I need them. And UPS, in all my experience of sending and receiving stuff, has never lost a package.

What if all bills went to the Internet? What if there were no more junk mail? I don’t exactly see that as the end of the world. Pretty environment-friendly, too.  And if some of the postal workers have to take a hit on their pensions, well, welcome to the real world. We’re under-funded and overcommitted.

In fact, once the post office goes bankrupt, let’s not stop there. How about shutting down every area where the government has had a decades-long monopoly, but just can’t drive results? Inner-city schools. Protecting the border. Heck, building and staffing prisons. Let’s privatize everything.

Actually, once you get past defense, regulating pharmaceutical companies, and making sure gas stations aren‘t overcharging you, there isn’t that much need for government at all.

Today the post office, tomorrow…everything else.

 

(New York Times bestselling author Michael Levin runs www.BusinessGhost.com, the nation’s leading provider of ghostwritten business books.)

California Legislators: Gut and Amend is Gutless and Abusive

In civics and government books, you find diagrams summarizing “how a bill becomes law.”  It shows multiple steps during which citizens’ representatives consider bills before they can be enacted.  That imagery of responsible deliberation is also cultivated by candidates on the stump.

Unfortunately, the end of each California legislative session illustrates a much sadder civics lesson by way of “gut and amend”(GANDA) bills.

As legislators race to pass bills before the deadline, the powerful take unrelated bills and replace them with completely different bills. Then, in the last-minute frenzy, they try to rush them through the last steps with minimal scrutiny (e.g., it is not unusual for there to be multiple different committee hearings in one room in an hour).  A sharper contrast with the “good government” civics illustration is hard to imagine. 

2011’s GANDA crop is an impressive addition to a long history of legislative abuses.  Its “highlights” include SB 922, which changed from a measure to add tuberculosis to information that may be disclosed under California’s immunization system to a measure barring local governments from banning project labor agreements. SB 202 also makes the list by morphing a bill to raise the filing fee for ballot initiatives from $200 to $2000 into one that would only allow ballot initiatives at November general elections and explicitly delayed consideration of one (ACA 4) until 2014.  And those are far from the only examples, reflecting little change from last year, when Dan Walters reported that “Dozens of bills were changed, sometimes introducing entirely new pieces of legislation.”

GANDA bills deserve rejection as blatant abuses of the legislative process, designed to escape virtually all scrutiny rather than to enable diligent deliberation.

Bills that command the necessary consensus can pass in the light of day.  Only those without sufficient support need the subterfuge of last-minute GANDA maneuvers that leave too little time for reading, much less evaluation.

Those who benefit from GANDA changes defend the process, but their argument is preposterous.  It amounts to claiming that, despite missing deadlines or failing to get approval, sometimes the legislature “just needs to act.”  But that is not a reason; it simply assumes its conclusion—proponents need to be allowed to circumvent the rules to enact their failed pet projects and special favors for no other reason than that they decided it was necessary.

For a GANDA bill to benefit Californians would require several things to be true.  Unfortunately, they are typically false.

The bill would have to be the legislature’s business.  Although they inject themselves everywhere, in fact there is very little legislation that can advance our general welfare.  Benefiting some at others’ expense is another matter, but Californians’ welfare requires that such bills be stopped, not greased through the process.

Only the legislature must be capable of dealing with the problem.  Where people can work things out for themselves, no legislation is needed. Those whose wisdom politicians laud during campaigns deserve credit for equal intelligence about their own affairs.

The problem must be so urgent that it cannot wait for the next legislative term.  And the sponsor must actually know how to solve the problem efficiently and equitably.

Any bill that met these requirements to actually benefit Californians could navigate the normal legislative process.  So a legitimate GANDA candidate must also come as a sudden surprise.  But it strains credibility to think that a legislator could quickly develop a real solution to some serious problem that was both unrecognized and undisclosed just weeks before, yet need to sneak it through.

Gut and amend survives only because it lets legislative urgency disguise legislators last-minute actions from public accountability.  Proponents may “need” it for their purposes, but those purposes do not advance the welfare of all Californians.  So every gut and amend bill is not only gutless, but deserves rejection as a reprehensible abuse by those who claim to represent us.

 

(Gary Galles is a Professor of Economics at Pepperdine University)

Tea Party GOP Debate: More Lame Attacks on Social Security

Monday night’s  GOP Presidential Debate hosted by CNN and the Tea Party express following a similar theme to last weeks debate was an indictment of the record of the newest entrant (and front-runner) in the Republican presidential primary: Gov. Rick Perry. This time though, criticisms were leveled more harshly centering mostly around the Texas governor’s harsh criticism of Social Security and am Executive Order in the Lone Star state that required young girls to be vaccinated for HPV. Not only did Mitt Romney continue his assault on Perry, but Rep. Michele Bachmann, coming off of a lackluster performance at the previous debate, took aim at Perry as well.

As a perceived leader in the Tea Party movement, Bachmann had to perform during last nights debate especially because she was little more than an ornament at the previous debate at the Reagan Presidential Library. Bachmann, in her Tea Party element, came out swinging focusing a great deal of her energy towards Perry who some argue is the reason Bachmann has lost so much momentum in the polls.

Even with the focused assault on Perry’s record though and the more memorable performance by Bachmann, the debate still lacked a “gotcha” moment that would change the game or even move the polls significantly. Perry came out of the debate more bruised than round one but hardly enough to deter a Republican electorate looking for a candidate with a record on job creation that has a chance of defeating President Obama. What the debate did probably better than anything else was to give the Obama campaign some fodder for the general election and talking points for the campaign trail.

That is not to say however Perry doesn’t have anything to worry about. The Social Security criticisms levied against him should not hurt him too much in a Republican primary, especially amongst Tea Party and hard right voters who might support drastic, if not, radical changes to the public retirement system. What he will however have to answer for–carefully–is the HPV vaccination order.

On face, the HPV vaccination order is disturbing because it involves the rights of one’s own body, but what Bachmann very astutely alluded to in her indictment was the way in which the Executive Order came about. Of course the implication is whether or not Perry’s administration went along with the vaccination because he was lobbying to do so, a charge that could be more damming especially when voters are increasingly skeptical about the power of special interests in Washington.

Most frustratingly though, last night’s debate  illustrated a willingness by some of the Republican candidates, including Romney and Bachmann, to use the same scare tactics about Social Security that the left often uses to attack conservative candidates, showing a lack of seriousness from both the former Massachusetts governor and the congresswoman when it comes to fundamentally altering the trajectory of entitlement spending if elected to the White House. It would be a travesty if the next elected president, especially if he or she is a Republican, did not honestly, thoroughly and decisively alter the Social Security system in the United States. It is dishonest to pretend minor tweaks will fix the failed system and to suggest, simply for political gain, that Perry is unfit to hold office because he has been blunt about the entitlement.

If a Republican will not get tough on entitlement spending, particularly social security, is it even worth sending he or she to the Oval Office? Probably not.

California to Regulate Babysitters?

Everything in California turns into a Hollywood movie. This one is a sequel to the 1991 teen farce, “Don’t Tell Mom the Babysitter’s Dead.”

In this case, the babysitter is regulated to death.

AB 889 is by Assemblyman Tom Ammiano, D-San Francisco. It would force you to follow complex state regulations every time you hired domestic help, including a babysitter. Absurdly, your babysitter would have to get a break every two hours. From what, writing on Facebook while your kids are asleep?

That would mean, if you and your spouse want to take in a dinner and movie, you’d have to hire two babysitters so one could spell the other very two hours.

In the bill’s summary, “AB 889 would regulate the wages, hours, and working conditions of domestic work employees, provide a private right of action for domestic work employees, including liquidated damages, and would provide an overtime compensation rate for domestic work employees.”

Obviously, the bill isn’t intended to regulate only babysitters. But it would hit them hardest.

The bill passed the Assembly in June, backed by the usual Soviet Democrats. It’s currently in the Senate Appropriations Committee.

There’s also a good question whether “the wages, hours, and working conditions of domestic work employees” include impregnating the maid, the way ex-Gov. Arnold Schwarzenegger did with Mildred Patricia Baena. No doubt the matter will have to be sorted out by the California Supreme Court.

“This is government stepping in and distorting the private sector,” Paulo Sibaja, director of legislation at the Capitol Resource Institute, told me. “This further extends government’s tentacles all over the home. It’s just intrusive altogether.”

It’s also another anti-family bill being pushed through the Legislature. I wrote yesterday about AB 499, by Assemblywoman Toni Atkins, D-San Diego. It authorizes a government school to inject the dangerous Gardasil vaccine into children as young as 12 years old — without their parents’ consent.

Fines and Lawsuits

Back to AB 889, the Nanny State regulation of nannies.

Among its other provisions, it mandates, “A domestic work employee required to be on duty for 24 hours or more shall have a minimum of eight hours of uninterrupted sleep except in an emergency.”

So, you and your spouse take a day off to drive to the Wine Country for some needed relaxation with fermented grapes. You obviusly don’t want to drive back. So you hire your faithful babysitter, a 67-year-old retired school teacher. She puts your young kids to bed early and goes to sleep herself. At 2 a.m., she wakes up because the kids are playing video games. It’s obviously not an emergency. The babysitter gives them milk and cookies. Everybody goes back to sleep and gets up at the regular time.

Because the babysitter’s didn’t get “a minimum of eight hours of uninterrupted sleep except in an emergency,” you have violated the law.

According to the bill’s wording:

An employer shall pay $50 to the employee for each day the employer violates these provisions. This bill also provides the domestic work employee the option of enforcing a violation by bringing a civil action.  Filing an administrative or civil complaint may be done up to three years from the time of the violation. Additionally, a domestic work employee who prevails in a civil action shall be entitled to legal or equitable relief including liquidated (punitive) damages. Staff notes that providing for liquidated damage appears to be unique in Labor Code provisions relating to employees.

Isn’t California wonderful? No wonder, as my colleague Wayne Lusvardi details in an article today, California families are fleeing California’s anti-family tyranny.

 

(John Seiler is the managing editor of CalWatchdog.com)

Amazon Deal Smacked Down

Amazon.com, the giant online retailer, is embroiled in a sales-tax mess with the state of California. And it’s under attack from “brick and mortar” retailers, including big-box retailer Wal-Mart.

Amazon has been working to get out from under a new law requiring sales tax on purchases from California residents, sold by in-state affiliates. After the law was passed, a referendum was started to repeal it. Amazon, a Seattle-based company, has contributed $5.25 million toward the initiative. And Amazon quickly collected the 500,000 signatures necessary to qualify the initiative on the June 2012 ballot. Because, after all, California residents would end up paying an additional 7.25 to 9.25 percent sales tax for online purchases.

However, legislative Democrats countered with an urgency bill, a tool not used very often by the Legislature.

Wal-Mart, the world’s largest retailer, has been leading the attack against Amazon for refusing to collect sales taxes on online sales. But it was recently revealed that Wal-Mart doesn’t always collect sales tax on its online sales.

It would appear that both giant retailers are under a tax assault by the California Legislature.

The Amazon sales tax took effect on July 1. It requires sales tax to be charged on online orders made through California-based affiliates. The bill states that if someone has advertisements on California Web sites, then there is a nexus in California, and the business needs to pay taxes on all revenue collected in the state.

But thus far, Amazon has refused to collect the tax on California purchases.

Adding an interesting twist to the situation, last week Amazon offered to put the referendum on hold, but only if California lawmakers and the governor agreed to a deal. The online retailer offered to create two new distribution centers in California, which would employ 7,000 workers, in exchange for a two-year exemption from collecting the sales tax.

With more than two million California residents out of work, Amazon’s offer sounds enticing, and perhaps is just what California needs right now, after enduring the worst economic downturn in state history.

But the state’s Democratic leadership rejected Amazon’s offer, instead opting for anticipated tax revenue from the new tax. Democrats and Gov. Jerry Brown are banking on $200 million in tax revenue from the online sales tax to help balance the state’s budget. As the New York Times even recently commented, “The struggling state of California thinks it has found gold in taxing e-commerce. But that money is proving much more elusive than it seemed just a few months ago.”

Talking about taxes instead of jobs is not a very good idea, given that California’s unemployment rate is the second highest in the country. As businesses flee the state in search of tax and regulatory relief, it is all too apparent that our state’s budget problems are directly related to a jobs shortage.

“Amazon’s proposal would repeal the sales tax collection requirement for retailers making capital investments of at least $250 million in California by 2013 or $400 million by 2015 and creating 3,600 full-time jobs with health insurance by 2013 and 7,000 full-time jobs by 2015,” the Los Angeles Times reported.

“Amazon is also offering to drop the referendum drive and send its California customers an annual statement of their Amazon purchases that might be subject to the state use tax, which is equal to the 7.25 percednt to 9.25 percent sales tax, depending on location,” the Orange County Register reported.

Shunning New Jobs

On Friday, Board of Equalization member George Runner sent a letter to the Governor and legislative leaders asking for their consideration of Amazon’s proposal and that they re-evaluate the projected budget revenue associated with the “Amazon Tax,” AB 28X.

In the letter, Runner described the proposed deal as a “win-win for California” because it would bring both jobs and millions in new tax revenue to the state.

Runner said that the projected revenues associated with the “Amazon Tax” will not materialize because Amazon affiliate terminations have already significantly reduced the number of online sellers required to register, the ongoing referendum effort could suspend the law until a vote next year and pending litigation could result in the law being struck down.

Real Taxes Collected

In contrast, the Amazon jobs proposal will lead to the collection of taxes due on sales to California, while creating much needed jobs for Californians. Allowing job creation would go much further in California than the online sales tax on the state’s residents.

Distribution center employees are paid from a low of the minimum wage up to $25.00 per hour, depending on experience. The average hourly wage in warehouse and distribution center jobs is $14.42 per hour. Full-time employees paid $14.42 per hour make $30,000 annually. On average, 7,000 distribution center jobs would total $210 million annually to employees.

For California to get an infusion of $210 million would be a boost to the staggering economy, particularly as the Amazon tax would affect existing California’s residents.  And these 7,000 employees would spend that $210 million in California on housing, groceries, cars, retail outlets, taxes, and yes, at Wal-Mart.

“It would be a terrible mistake to reject thousands of jobs for Californians on a faulty budget estimate,” Runner said in a press statement. “Please re-examine the AB 28X budget estimate to ensure that we do not miss a historic opportunity to help struggling California families get back to work, as well as drawing significant new business investment and tax revenue to our state.”

But the Democrat-controlled Legislature and Democratic Gov. Jerry Brown appear not to be interested in Amazon’s offer.

“The BOE analyses of AB 28X and related bills, however, warned that these budget dollars were always questionable because of ‘probable behavioral changes’ by online retailers,” Runner said in his letter.

Runner said that no additional online retailers that have registered with the BOE to collect sales tax since the Amazon tax was passed. Instead, the total number of out-of-state registrations with BOE in July 2011 was 180. That was 31 lower than 211 in July 2010. It was approximately a 12 percent drop.

Pitting Amazon and Wal-Mart against each other is a bad idea. While each giant retailer is scrambling right now to avoid paying or enforcing additional state sales taxes, they could instead join forces and turn their attention on lawmakers. That could be an assault worth supporting.

(Katy Grimes is a columnist for Calwatchdog.com, the journalism center of the California-based Pacific Research Institute)