August 27-29, 2013
Aug 27 11:24 Proof that tax rates matter Aug 27 16:35 Federal bill imposes sin tax on law-abiding citizens Aug 28 01:36 Trusting this administration or your own eyes? Aug 28 15:42 President Potter's enrollment nightmare, Part II Aug 29 03:54 Gov. Dayton learns lesson from ABM
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Prior Years: 2006 2007 2008 2009 2010 2011 2012
Proof that tax rates matter
This article is filled with irony from this conservative's perspective. Los Angeles, Calif., has been the home to the movie industry since before I was born. LA's new mayor, though, sees the signs that California's oppressive taxes is hurting his city. In fact, he's panicking over it:
Hollywood's homegrown industry is being ceded to other states and countries whose favorable tax credits are increasingly luring away movie and television production at an alarming rate. As competition both in the U.S. and abroad continues to grow, the state's market share and longtime stronghold on production jobs and spending are fast evaporating.
The simple reality is that tax rates matter. Hollywood isn't making films because they're altruistic. They're attempting to make as tons of money. California's oppressive taxation is cutting into these companies' profits:
These days studio chiefs insist that filmmakers they work with take advantage of out-of-state incentives to lower production costs, which on a single major motion picture can amount to savings of tens of millions. Those savings are crucial in a franchise-obsessed era when big-budget movies commonly cost north of $200 million to produce, while on the revenue side the DVD market has largely collapsed and cinema attendance has been generally flat over the past decade. In the current climate, most independent projects would not even be produced without incentives.
This cuts to the heart of the matter. Production companies are going where they stand to make the most profit. If other states offer better incentives, that's where these companies will go. Rather than offering special incentive packages, California can get these jobs back by simply offering a better tax rate. Unfortunately, that isn't likely to happen:
'Tomorrow we are not going to wake up with an unlimited cap on credits,' Garcetti says. 'But we have to show forward progress, and I am going to be like a dog with a bone on this and stay with this. I can't single-handedly move Sacramento, but I think we will do what works to educate our lawmakers: that this is a huge shot in the arm for our economy to land a lot of this back.'
Skeptical lawmakers can say that the state already has done what it can: its $100 million-per-year incentive program may not match those of other states (New York's is about $420 million) but is certainly better than nothing. California elected officials renewed the program, in the midst of ever-tight state budgets, twice. The most recent renewal, a two-year extension to 2017, was passed overwhelmingly even after a state legislative analyst report concluded that the economic benefits of providing incentives would be a wash, or even a slight net loss, to the state's coffers.
California's biggest problem is that they're spending billions of dollars on the trendiest things, things that don't create jobs. Green energy companies were supposedly California's newest contribution to the national economy. Instead, they've been a total bust.
California spends literally billions of dollars on lavish public employee pensions. Cities have declared bankruptcies as a direct result of these obligations. In order to pay those obligations, California has raised tax rates. They've decided that paying these lavish obligations is more important than creating private sector jobs. For that matter, they've decided that it's more important to pay these lavish pension benefits than it is to hold onto jobs that they've had for decades.
Until they change their priorities, Californians will continue losing jobs and Eric Garcetti's crisis will get worse.
Posted Tuesday, August 27, 2013 11:24 AM
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Federal bill imposes sin tax on law-abiding citizens
The federal government is attempting to reduce gun violence by taxing law-abiding citizens through this legislation :
SEC. 4181. IMPOSITION OF TAX.
'There is hereby imposed upon the sale by the manufacturer, producer, or importer of the following articles a tax equivalent to the specified percent of the price for which so sold:
'(1) Articles taxable at 20 percent:
'(A) Pistols.
'(B) Revolvers.
'(C) Firearms (other than pistols and revolvers).
'(D) Any lower frame or receiver for a firearm, whether for a semiautomatic pistol, rifle, or shotgun that is designed to accommodate interchangeable upper receivers.
'(2) Articles taxable at 50 percent: Shells and cartridges.'.
(b) Exemption for United States- Subsection (b) of section 4182 of the Internal Revenue Code of 1986 is amended to read as follows:
'(b) Sales to United States- No firearms, pistols, revolvers, lower frame or receiver for a firearm, shells, and cartridges purchased with funds appropriated for any department, agency, or instrumentality of the United States shall be subject to any tax imposed on the sale or transfer of such articles.'
First, this bill won't get a hearing in the House of Representatives. It's going nowhere fast. Second, even if such a bill would pass, it wouldn't reduce gun violence. Violent criminals commit violent crimes. The feds imposing a huge sales tax on guns and ammo won't stop gun violence because violent criminals don't buy guns and ammunition from retailers. They buy those things on the black market.
The only impact this legislation would have is on law-abiding citizens. It'll dramatically drive up the cost of guns and ammunition for law-abiding citizens, making it more difficult for people to defend themselves. This is as nutty as Seattle starting a campaign to announce which stores are gun-free:
MAYOR MCGINN: Over 50 businesses in Seattle have declared themselves as gun-free zones and they would prefer that people not come in with guns. And if they do come in with guns, they will be asked to leave.
GRETA: Mayor, before I got into TV, I was a criminal defense attorney and if my clients heard that there was a store that was part of a gun-free zone, it would be open season on that store. And I know that part of the program is that they put stickers in the windows.
This is just the opening to the interview. Watch the entire thing to see just how naive this mayor is. Frankly, it's breathtaking.
Posted Tuesday, August 27, 2013 4:35 PM
Comment 1 by Jethro at 28-Aug-13 09:15 AM
The Seattle mayor is sorely misguided. Having a "gun free" sign on a store tips the scales in favor of the criminal. Greta is right...it will be open season on those stores. When will the anti-gunners start focusing their energy on criminals and not law abiding citizens who legally carry guns? There is a difference.
Trusting this administration or your own eyes?
In the opening of this article , Grace-Marie Turner paraphrases Groucho Marx's famous quote:
To paraphrase Groucho Marx: Who are you going to believe? Me, or your own eyes?
She's talking about the building evidence that the PPACA is turning America into Part-Time Nation:
An avalanche of 'anecdotes' continues to pile up as workers across the country are having their hours cut and their health benefits slashed across a broad range of industries.
Loren Goodridge, the owner of 21 Subway franchises, says he has no choice but to cut the hours of his employees to 29 a week to avoid the law's penalties.
The negative effects of the law reach the education industry as well. St. Petersburg College, a public university in Florida, is reducing the hours of 250 faculty members because the college says it cannot afford to provide them with health insurance.
The avalanche of "anecdotal evidence" is piling up daily. In fact, it's approaching irrefutable levels. When I wrote this post , I cited this post as a counterpoint to the White House's spin. Here's why I cited it:
But what really shows what is going on in America at least in 2013, is the following summary: of the 953K jobs "created" so far in 2013, only 23%, or 222K, were full-time. Part-time jobs? 731K of the 953K total.
The point is that there's a noticeable, distinct trend in hiring. That trend isn't likely to ebb, much less reverse:
The shift to part-time has accelerated over the past several months because of the 'look back' provision in ObamaCare that sets the baseline this year for the number of full-time workers a company employs to determine their compliance with the employer pay-or-play mandate.
Sen. Baucus put it best in this now-epic speech:
This won't end well for the administration. Forget about their spin that "there will be bumps in the road." The PPACA is heading for a full-fledged train wreck.
Posted Wednesday, August 28, 2013 1:36 AM
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President Potter's enrollment nightmare, Part II
I first wrote about President Potter's enrollment nightmare in this post . That post was published on August 20, 2013. New figures from MnSCU have come to light that are worth examining.
In the initial post, MnSCU actual enrollment numbers said that St. Cloud State would collect $8,218,000 less in revenue than last year. As expected, that number is improving. Unfortunately for the Potter administration, the newest numbers are still pretty bleak. Based on enrollments as of August 22, 2013, St. Cloud State will collect $6,972,000 less during the 2013-14 school year than during the 2012-13 school year.
UPDATE: A faithful reader of this blog informed me that the $6,972,000 figure "is for FALL semester only" and that "it is worse than you say!" I stand corrected.
These numbers have been verified by a member of the budget committee. The person I've spoken with says that there's a possibility that FYE enrollment (Full Year Equivalents) might be down by as much as 10% this year. The administration initially forecast that the FYE enrollment would be down by 2.8% to 3.2%.
When the administration first published those projections, few faculty members took the projections seriously. It's apparent these faculty members were right about their skepticism. It isn't a stretch to think that the faculty knew the administration's figures were spin more than statistical projections.
It isn't a stretch to think of the administration's 'projections' as SWAG, aka a Statistical Wild Ass Guess. To be fair to SWAGers, though, it might be more accurate to simply call the Potter administration's statistics as spin or wishful thinking.
St. Cloud State's highest enrollment came in 2010. That year, approximately 18,300 students attended the University. That number had shrunk to approximately 15,600 last year, a decline of 14.75%. If enrollment drops another 10%, that means enrollment will have dropped by 23.5% in 4 years.
What's worse is that St. Cloud State doesn't have a plan to reverse the declines. Recently, they checked to see if anyone had seen any of Dr. Mahmoud Saffari's enrollment retention proposals. When he was terminated, Provost Malhotra criticized Dr. Saffari for not having a "strategic enrollment management plan" in place:
From the October 31, 2011 letter from Provost Malhotra: 'During my tenure as provost you have not produced a satisfactory strategic enrollment management plan, despite my continual counsel to you to focus on data analytics and statistical predictive models.'
It's almost 2 years since President Potter terminated Dr. Saffari. The University still doesn't have a "strategic enrollment management plan." Based on MnSCU's enrollment figures, St. Cloud State better get one in place fast before its enrollment rivals that of the biggest community colleges.
At this point, there's nothing suggesting that the Potter administration is being honest about their enrollment projections. There's nothing suggesting they have a plan for turning around their enrollment declines.
That's unacceptable and this administration knows it.
Originally posted Wednesday, August 28, 2013, revised 29-Aug 2:46 PM
Comment 1 by Stephen Fuller at 30-Aug-13 12:06 PM
I suspected this might happen. I believe SCSU cannot expect to continue to recruit only from undergrad pool, esp. with the new emphasis on the Technical and Community Colleges. Those schools will get the bulk of that enrollment.
SCSU should be focusing on upper division and grad programs for not only recruitment but its sustenance. Anything less will be just "spinning our wheels."
Response 1.1 by Gary Gross at 30-Aug-13 12:13 PM
Stephen, Thanks for that insight. For what it's worth, I want SCSU to succeed because a vibrant, thriving SCSU adds to St. Cloud's economic success.
Gov. Dayton learns lesson from ABM
If there was any question whether the Alliance for a Better Minnesota had negatively affected him, this article is proof that ABM has changed him:
Dayton said the machinery tax repeal is the only other issue he would like discussed in the one-day session, adding that he would like to see the tax refunded retroactive to Aug. 1.
He later told farm reporters that the producer tax was in a huge budget bill and he didn't even know it was in the legislation. 'It surfaced in the last minute of the last night, and no one even wants to take responsibility for (putting it in the tax bill).'
That's BS and Gov. Dayton knows it. Here's how he knows he's lying:
Rep. Hamilton asked Rep. Lenczewski whether there'd be a sales tax imposed on farm equipment repairs on the last night of the session. She confirmed that that would be one of the taxes imposed by this year's tax bill.
Furthermore, there were heated discussions between Senate Democrats and Rep. Lenczewski over imposing this tax on farmers. Rep. Lenczewski eventually won that fight. There's no way Gov. Dayton could've missed the heated discussions between Bakkk, Sen. Skoe and Rep. Lenczewski on the farm equipment repair sales tax.
The Tax Bill was the big thing for the last night of the session. Everything else was insignificant by comparison. If there was anything that Gov. Dayton and his staff were monitoring that night, it was the Tax Bill.
While it's quite possible to believe Gov. Dayton didn't notice it that night, it's impossible to think his commissioners and staff didn't notice what'd happened in the Tax Bill conference committee.
The reality is that Gov. Dayton lied at Farmfest when he said he didn't know the farm equipment repair sales tax was in the Tax Bill. For his administration not to know what was in his signature bill this session simply isn't credible.
Posted Thursday, August 29, 2013 3:54 AM
Comment 1 by J. Ewing at 30-Aug-13 08:21 AM
It is possible to not know things that your drug-addled brain forgot.
Comment 2 by Skip at 31-Aug-13 10:26 AM
Ditto to J. Ewing. All these so-called trade trips were probably rehab sessions.
Comment 3 by walter hanson at 31-Aug-13 03:06 PM
Gary:
I'm surprised that Governor Dayton didn't say that you sell more than a million dollars of a product a year. That makes you the rich!
Walter Hanson
Minneapolis, MN
