Tax cuts and jobs?

November 5, 2017 · Posted in Business and industry, Inside the Beltway, National politics, Politics, State of Conservatism · Comments Off on Tax cuts and jobs? 

Since I said this yesterday:

I guess I better use the space for something besides music reviews, analysis of baseball trades, and other non-political items.

As many of you who know my site probably also know, the House put forth its initial proposal for what is being called the Tax Cuts and Jobs Act. (President Trump would have preferred the Cuts Cuts Cuts Act himself, though.) So most of the argument and commentary seems to be on whether this does enough for individual taxpayers – naturally, Democrats revert to their age-old “tax cuts for the rich” saw while some Republicans fret about losing particular deductions.

But I want to address two things in this post. First, I want to try and step into the shoes of a small business owner because part of the bill title is “that three-letter word, J-O-B-S” (with apologies to Joe Biden) and they are the ones who create most of them – including the ones I have now.

I’m not going to get into actual dollars and cents here because this is more of a philosophical argument. Each year business owners hand a share of their revenues off to various branches of government for a host of reasons, but the one item that perhaps draws the most blood, sweat, and tears is that federal tax return they (or, more likely, their accountants) fill out each year. Thus, the idea of both lowering rates and making things simpler works positively in two ways: a little more money to invest in the business for new hires, capital improvements, or expansion (people in my line of work perk up their ears at the latter) and a little more time to enjoy life or improve the business plan. They may not need to give that accountant quite so much, but, alas, there are winners and losers in life. (However, the day we find out H&R Block is lobbying against a tax reform proposal is the day we’ll know we have the right formula.)

The common perception from the Left is that every business owner is a fat cat member of the 1% who pays his employees less than minimum wage, skimps on benefits, and hoards his profits to spend on his fancy car and yacht – Ebenezer Scrooge personified. I don’t know about you but I haven’t met one like that yet, although I will note my previous employer went out and got a BMW i8 complete with vanity plate (and installed the charger in our parking lot) thanks to a series of very successful businesses. But that came after years of long days and lots of hard work, so I wasn’t going to complain because he had aptitude, drive, and a range of talents I didn’t.

By the same token, it’s not unknown for my current employer to be at the office or meeting clients late into the evenings or on the weekends – I know because I used to work in there at those times myself (on top of my full-time job) in order to seize the opportunity I was presented to get back into his firm. Ambitious people laugh at a 40-hour work week, and the overriding question that is being answered to an extent by the Tax Cuts and Jobs Act is whether they should be rewarded for those efforts or forced to hand over the excess to government to redistribute to the less ambitious.

After all, hopefully there comes a point in the life of a business where the boss can’t do it all himself (or herself.) Adding people, though, brings a whole new world of complexity to the tasks so the rewards should be maximized and risks minimized in order to encourage even more hiring when business dictates. If the government takes a pinch less maybe the additional economic activity will make up for it in time.

This brings me to my second point: whose money is it anyway?

Consider the average dollar, which is representative of an intrinsic value. There’s an old joke where someone leaves a $100 bill on a hotel counter while he inspects a room and it quickly makes the rounds paying off various debts up and down the street before the customer decides the room isn’t satisfactory and takes back the Benjamin, which seconds before had paid off the last debt owed to the hotel clerk. Everyone had a value assigned to the cash although the overall transaction was a wash.

When a worker makes a dollar, it’s a tradeoff: even at minimum wage, it’s about eight minutes of his labor in return for a dollar’s wage. In a successful business, the employee performed more in the way of value to the company than the pay but the rate of pay was still acceptable to the employee. (On top of that you have benefits, but for the purpose of this argument I’ll concentrate on pay.) My full time employer bills me out at a rate that is supposed to cover the wage, benefits, and overhead so in return I have work to do. My writing employer gives me an assignment on Thursday night and expects a turnover for the following morning. As long as this is done profitably for both parties, everything is cool – the problems occur when labor costs begin to outweigh value added. (For an example, consider why you are faced with a kiosk instead of a live person in some fast food restaurants – human order takers didn’t add a lot of value if they were inaccurate, grouchy, not feeling well, or disorganized, especially at the $15 an hour for which they were pining.)

Now think about a dollar spent in taxes, where the tradeoff is completely different. There are a number of vital services these taxes pay for, especially at a local level where the business receives its public safety protection, maintenance for the roads, portions of the utility infrastructure, and various other items which vary based on the jurisdiction.

Unfortunately, the higher up the taxation food chain you go, the more likely you’ll find these tax dollars aren’t creating value. Oftentimes these entities will act as a pass-through, returning tax dollars to the state or local jurisdiction after keeping a cut for themselves and necessitating the employment of a grant writer on a local level. It’s making a pencil-pusher rich, but that’s not really adding to society like a guy out working on an oil rig, writing computer code, or burning the midnight oil trying to figure out how to please her engineering client. Even worse, that dollar may be paying the bureaucrat who’s writing the rule that will do the business in at the behest of a lobbyist bought and paid for by some special interest.

By keeping dollars in the more productive and efficient private sector, not only does lowering taxes help increase GDP but it also provides the incentive for people to work harder. I’ve often cited Atlas Shrugged as one of my favorite books, not because it’s a feelgood story but because I see it as an absolute indicator of where our nation could be headed under the government we’ve put in place. If working harder has no reward, then why do it?

We have a long way to go before we see tax reform, if it even comes about at all because Republicans in Congress aren’t completely sold on the package. (I thought the GOP was supposed to be the party that supported lower taxes – didn’t you?) But the argument shouldn’t be who wins and loses financially – it should be about whether we believe it’s our money we’re getting for our labor or if we feel we just get to use that which is benevolently granted to us by government.

2017 Wicomico County Lincoln Day Dinner in pictures and text

October 30, 2017 · Posted in All politics is local, Business and industry, Campaign 2018, Delmarva items, Inside the Beltway, Maryland Politics, National politics, Politics, State of Conservatism · Comments Off on 2017 Wicomico County Lincoln Day Dinner in pictures and text 

This time around it will be fewer pictures and more text. It’s not like I haven’t done this for many years at the same venue. But you may recall I took a hiatus from party politics for awhile, meaning this was the first such event I’d attended in two years.

So I was greeted with mainly open arms, although many people thought I had already moved to Delaware. (Not quite yet.) Regardless, the feel of the event was such that I felt right at home – the only difference was that we were supposed to begin an hour earlier to accommodate our speaker. As it turned out, we got underway about 45 minutes late (or 15 minutes early by our “normal” schedule), so I who was there at 5:00 for a 6:00 dinner had plenty of time to commiserate and hear the band play.

One of the new folks I got to meet was the lone statewide candidate to attend. She is definitely having fun on the campaign trail.

Angie Phukan (a.k.a. “MsComptroller”) is, as the tagline would suggest, running for the GOP nomination for Comptroller. To date she’s the only candidate to file against incumbent Democrat Peter Franchot, who likewise has filed. She hails from Ocean City, so she’s a statewide candidate in our backyard.

I had actually conversed online with her a few weeks back when she was trying to figure out her yard signs. I suggested simpler is better, and assured her last night she need not worry about separate signs for primary and general elections. “Your job right now is to build name recognition,” I told her.

Of course, most of our local contingent of folks were there as well. One I want to point out is Mary Beth Carozza, Delegate from District 38C. Here she’s between County Council member from District 5 Joe Holloway and his wife Faye. (Holloway is once again my Councilman since we moved.)

The reason Carozza is important to the story is she’s making a “special announcement” next month in Ocean City.

The speculation is rampant this will make formal what’s been rumored for awhile: notice how much Jim Mathias is on social media these days? If Mary Beth indeed decides to try for the promotion, she would join Democrat-turned-Republican Ed Tinus in the race, although Tinus could then decide to seek the open Delegate seat.

As always, we began with a visit from our 16th President and the event’s namesake.

I had some fun with the photo since it demanded an oldtime look. As he always does, Lincoln waxed eloquent with tales from his life, this time focusing on the time he was a young man who studied voraciously to tackle new opportunities that came his way, such as surveying or winning his first elective office at the age of 25. (Oddly enough, the Whigs of the day had to contend with voters who were ineligible because they didn’t live in the district or weren’t yet citizens.) Observing today’s political landscape, he noted that there seemed to be no survey plan to drain the swamp.

As I was driving around to find a parking spot before the event, I spied a well-dressed man who seemed like he was looking for the door to get in. I thought it was David Bossie and it turned out I was right. He may be our Republican National Committeeman and entrenched as a confidant for President Trump, but he was still baffled by the setup of Salisbury University’s Guerrieri Hall.

But when it was Bossie’s turn to speak, there was no confusion. First of all, he asked how many in the room thought a year ago that Donald Trump would win. When a fair number went up, he said “Liars,” adding “I didn’t raise my hand.”

“I’ll tell the President that he had a room full of people who knew he would win,” added Bossie. He only figured it out as he was feeding information to the soon-to-be President on Election Night.

David had met Trump several years earlier through a mutual friend who believed Trump would be willing to lend the use of his golf course for a charity event Bossie was organizing. The main reason for Bossie’s interest in that cause was his then-six month old son, who had several medical issues that piqued his interest in fighting against Obamacare in the belief it would damage our medical system that was aiding his son.

Bossie’s role in the campaign and eventual transition was “a humbling experience,” although for a time it greatly diminished when Paul Manafort was hired. Manafort “froze him out,” so when Trump “thankfully…(got) rid of Manafort” Bossie helped lead the comeback from a low point after the GOP convention.

So the day after Trump shocked the world, they realized there was no formal transition plan. In part, that was superstition from Trump, an avid sportsman who had the belief – like many athletes who compete regularly do – that considering the transition would be a departure from routine and would jinx his campaign. Shortly after the victory, though, David was selected as the Deputy Executive Director of the transition.

While this was going on, Bossie remained at the helm of Citizens United, which he described as “focused on the President’s agenda like a laser beam.” The problem with enacting it, continued David, was that our government was “dysfunctional and out of touch.” Since the House and Senate were elected on the same issues as Trump was, their reluctance to cooperate was an affront to President Trump. “He’s a pissed off dude, isn’t he?” said Bossie about the President. “Get something done and the temperature goes down,” he added, referring to the Senate and relations between them and Trump. If they do, there’s a “good opportunity to pick up Senate seats…really good math for us.” Bossie mentioned races in Ohio and Missouri as strong possibilities for pickups and welcomed the changes in Arizona and Tennessee with the retirements of Jeff Flake and Bob Corker, respectively.

(Interesting to note: the mentions of Flake, Corker, and John McCain drew boos and hisses from some in the crowd.)

We needed, though, to put aside the things of a year ago. Remember, “if Hillary Clinton wins, the nation as we know it is over,” said Bossie. But since Trump won, things have taken shape with our economy: the Dow is “out of its mind” and as far as regulations go, Trump promised to eliminate two for every new one. “Do you know how many he’s done?” Bossie asked, and someone in the crowd you may know well said, “Sixteen.”

“Who said sixteen?” he asked. “Showoff.” Indeed, the Trump administration is mowing down regulations at a frenetic pace.

But the economy is missing one thing: a “robust” tax reform package; one that Bossie described as “generational.”

“Shame on us if we don’t get it done,” Bossie said, and the sooner the better: if enacted by year’s end and made retroactive for 2017, the boost in the economy will kick in around next summer and make the 2018 election a pocketbook balloting. If done in the spring, the effects won’t be nearly as great, argued David.

While Bossie apologized in advance for not being able to stay too late, he did answer a few questions.

The first one required him to put on his National Committeeman hat, as he was asked “what can we do on the Eastern Shore?”

Our focus, said David, should be first on winning the needed five State Senate seats to sustain Governor Hogan’s vetoes. Of course, that also meant we had to turn out for Hogan as we did last time so he could defeat the “worst group of Democrats” in the country.

He was less optimistic when asked about what we could do about Ben Cardin. “There’s lost causes, then there’s lost causes,” said Bossie. That may be news to Sam Faddis, who is the only Republican with an FEC account in that race so far. (No one has formally filed, save three Democrats not named Cardin who are hoping the incumbent retires or keels over.)

Someone else asked whether GOP money was going to Donald Trump. Their investment is “behind the scenes” right now, assured Bossie, although Trump already has a 2020 re-election account as well. The RNC is “stockpiling” money with a large advantage in fundraising over the Democrats at the moment.

Turning to foreign affairs, a question was asked about our relationship with China.

Trump was focusing on the Chinese president, David said. “No one wants war,” and by dealing with China – which is the main trading partner of North Korea – Trump is dealing with an entity that could “suffocate” North Korea if they chose. It’s a combination of tough talk and diplomacy, he added.

Finally, it was asked about the governors not supporting Trump. Bossie argued that their agenda was better off with Republican governors whether they agreed with President Trump on everything or not. And even though our governor didn’t support the Trump bid, it was “vital” he be re-elected anyway, concluded Bossie.

With that, he was off to see his family before an early morning gig on Fox News, so the conclusion of the event was the introduction of a number of elected officials, club officers, and 2018 candidates, along with the drawing of raffles from both the Wicomico County Republican Club and the College Republicans. As it turned out both grand prizes were donated back to their respective organizations, so the WCRC can once again give away a $1,000 Dick’s Sporting Goods gift card and the College Republicans netted $280. Wicomico County GOP Chair Mark McIver also announced that there were 130 people in attendance, making this a successful event that grossed better than $8,000.

Just like in the beginning, there are people who stay around and gab the night away. In this case, it’s Delegate Charles Otto (left) with Joe Schanno of the Department of Natural Resources (center) and Dwight Patel (right), who annually makes the trip from Montgomery County to show his support. We finally cleared out about 9:30, although there was an impromptu afterparty offsite some chose to enjoy.

It was nice to be remembered, and as I had pointed out to me by County Councilman Marc Kilmer, now that I’m a “free agent” I can pick and choose my events. Trust me, I’m still on the mailing lists.

But writing this was like riding a bicycle – you don’t forget how to do it even after awhile away. It was fun.

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  • 2018 Election

    Election Day is November 6 for all of us. With the Maryland primary by us and a shorter widget, I’ll add the Delaware statewide federal offices (Congress and U.S. Senate) to the mix once their July 10 filing deadline is passed. Their primary is September 6.

    Maryland

    Governor

    Larry Hogan (R – incumbent) – Facebook Twitter

    Shawn Quinn (Libertarian) – Facebook

    Ben Jealous (D) – Facebook Twitter

    Ian Schlakman (Green) Facebook Twitter

     

    U.S. Senate

    Tony Campbell (R) – Facebook Twitter

    Ben Cardin (D – incumbent) – Facebook Twitter

    Arvin Vohra (Libertarian) – Facebook Twitter

    There are three independent candidates currently listed as seeking nomination via petition: Steve Gladstone, Michael Puskar, and Neal Simon. All have to have the requisite number of signatures in to the state BoE by August 6.

     

    U.S. Congress -1st District

    Andy Harris (R – incumbent) – Facebook Twitter

    Jenica Martin (Libertarian) – Facebook Twitter

    Jesse Colvin (D) – Facebook Twitter

     

    State Senate – District 37

    Addie Eckardt (R – incumbent) – Facebook

    Holly Wright (D) – Facebook

     

    Delegate – District 37A

    Frank Cooke (R) – Facebook

    Sheree Sample-Hughes (D – incumbent) – Twitter

     

    Delegate – District 37B (elect 2)

    Chris Adams (R – incumbent) – Facebook Twitter

    Johnny Mautz (R – incumbent) – Facebook Twitter

    Dan O’Hare (D) – Facebook

     

    State Senate – District 38

    Mary Beth Carozza (R) – Facebook Twitter

    Jim Mathias (D – incumbent) Facebook Twitter

     

    Delegate – District 38A

    Charles Otto (R – incumbent)

    Kirkland Hall, Sr. (D) – Facebook Twitter

     

    Delegate – District 38B

    Carl Anderton, Jr. (R – incumbent) Facebook Twitter

     

    Delegate – District 38C

    Wayne Hartman (R) – Facebook

     

    Delaware

     

    U.S. Senate

     

    Republican:

    Rob ArlettFacebook Twitter

    Roque de la FuenteFacebook Twitter

    Gene Truono, Jr. –  Facebook

     

    Libertarian (no primary, advances to General):

    Nadine Frost – Facebook

     

    Democrat:

    Tom Carper (incumbent) – Facebook Twitter

    Kerri Evelyn HarrisFacebook Twitter

     

    Green (no primary, advances to General):

    Demitri Theodoropoulos

     

     

    Congress (at-large):

     

    Republican:

    Lee MurphyFacebook Twitter

    Scott Walker

     

    Democrat (no primary, advances to General):

    Lisa Blunt Rochester (D – incumbent) – Facebook Twitter

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