Voice For Liberty

Tag: Tim Huelskamp

  • Kansas and Wichita quick takes: Monday October 24, 2011

    Wichita City Council. This week is the fourth Tuesday of the month, so the Wichita City Council meeting is largely confined to consent agenda items plus workshops. An item on the Council agenda is titled “Approval of travel expenses for Mayor Carl Brewer and Vice Mayor Lavonta Williams to attend, by invitation, the African Global Sister Cities Foundation Governmental, Business, Education, Cultural Arts and Sister City exploration in Ghana, West Africa, November 14-23, 2011, for possible international trade and twinning city relations. Airfare expenses will be paid by Mayor Brewer and Vice Mayor Williams.” Although the agenda report doesn’t state so, for these trips generally the lodging and meals are paid for by the host city or some other organization, not by the City of Wichita. But if these trips are truly good for the city, the city should pay expenses for those who go, just as companies pay legitimate travel expenses for their employees. But the city has no products of its own to sell, and the city isn’t authorized to negotiate international trade agreements. According to the Economic Freedom of the World report, Ghana ranks 70th of the 141 rated countries, so I hope we’re not planning to import ideas on governance from this country. It seems these trips are just junkets and not truly productive, so maybe it’s best the city doesn’t pay for airfare. … The workshop topic is concealed carry in Wichita city buildings. … As always, the agenda packet is available at Wichita city council agendas.

    ‘Federalists’ author to appear in Wichita this week. On Tuesday October 25th Kansas Family Policy Council is hosting an event in Wichita featuring Joshua Charles, a recent KU graduate who has teamed up with Glenn Beck to write the book The Original Argument: The Federalists Case for the Constitution Adapted for the 21st Century. The book debuted at the top of the New York Times Bestseller List in July. … KFPC says “The event will be at Central Christian Church (2900 North Rock Road in Wichita) on Tuesday October 25th at 7:00 pm. Doors will open at 6:30 pm. This is a free event and dessert will be provided for attendees.” RSVP is requested to 316-993-3900 or contact@kansasfpc.com.

    Rep. Huelskamp to speak in Wichita. This week’s meeting (October 28th) of the Wichita Pachyderm Club features U.S. Representative Tim Huelskamp, who is in his first term representing the Kansas first district, speaking on “Spending battles in Washington, D.C.” The public is welcome and encouraged to attend Wichita Pachyderm meetings. For more information click on Wichita Pachyderm Club … Upcoming speakers: On November 4th: Chris Spencer, Vice President, Regional Sales Manager Oppenheimer Funds, speaking on “Goliath vs Goliath — The global battle of economic superpowers.” … On November 11th: Sedgwick County Commission Members Richard Ranzau and Jim Skelton, speaking on “What its like to be a new member of the Sedgwick County Board of County commissioners?” … On November 18th: Delores Craig-Moreland, Ph.D., Wichita State University, speaking on “Systemic reasons why our country has one of the highest jail and prison incarceration rates in the world? Are all criminals created equal?” … On November 25th there will be no meeting.

    Kansas tax reform. Citizens for Tax Justice has warned Kansas about possibly bad effects of tax reform in Kansas. In particular, the organization warns that eliminating the Kansas income tax (the article doesn’t specify individual, corporate, or both) and replacing it with a sales tax would result in a sales tax rate of 13.5 percent. Calculations like this are usually made in a vacuum and ignore the dynamic effects of people making adjustments. For example, the state might — wisely — decide to spend less, and therefore less revenue would be needed. Plus, the reason for reducing income taxes is to generate a more favorable business climate so that Kansas stops losing people and instead attracts people and business. This would lead to increased tax revenues. … The article also warns that Kansas doesn’t want to be more like Texas, citing statistics such as Texas being last in the country in the percent of adults with a high school diploma. The organization that collected these statistics, the Brookings Institution, explains that Texas’ low ranking is due to its large immigrant population, which arrived as adults with no diploma. CTJ didn’t mention that.

    The debt of the states. Most states, Kansas included, have a balanced budget requirement. So it comes as somewhat of a surprise that collectively, the states hold about $4 trillion in debt. This figure comes from a new report by State Budget Solutions (Report reveals aggregate state debt exceeds $4 trillion). By way of comparison, the federal government holds about $14.8 trillion in debt. Bob Williams, President of State Budget Solutions, said: “These deficit numbers are staggering and should be frightening to the American public. Due to budget gimmicks, many states fail to give an adequate picture of how much trouble they are really in. This report makes it clear that if legislators don’t act immediately and decisively, our country will be facing a budget crisis that we have never seen before.” … According to figures gathered by SBS, the per capita debt in Kansas is $2,009, which ranks Kansas at 34th in the nation. Figures for some of our neighboring states include Colorado at $1,068, Iowa at $1,026, Missouri at $813, Nebraska at $21 (!), Oklahoma at $595, and Texas at $1,568. … Ominously for Kansas, the report includes separate figures that place our unfunded pension liability at $21.8 billion, well over twice as high as the numbers used by most official sources. The difference: “The AEI figures estimate how large public pension liabilities would be if states used private sector market-valuation methods.” In other words, the real world.

    Freedom of the press. One of the assertions in the statement made by the Occupy Wall Street movement is “They have used the military and police force to prevent freedom of the press.” Really? I wasn’t aware this was going on. I would think that with the internet, that freedom of the press is thriving in the U.S. Perhaps OWS was thinking of China.

    Student loans. One of the ideas tossed about by the Occupy Wall Street group is forgiveness of student loans. This debt is a problem, no doubt, especially when graduates can’t find work. Some fear that student loans will be the next great bubble — a government-caused problem that requires a government solution. In reality, easy government loans and grants have fueled the rapid rise in college costs, another government-caused problem that requires a government solution. Kansas Watchdog has more at Student Loan Racket Enables Higher Education Bubble .

    Obama makes a great appointment. Malcolm Harris lets us know that it seems that President Barack Obama has made a wise appointment. This example is Tom Hoenig to serve at the FDIC. See Tom Hoenig Nominated to Be the Vice Chair of the FDIC.

    Libertarianism works both ways. Dr. Jeffrey Miron explains the two “flavors” of libertarian thought and explains that they’re really not different at all. In his recent book Libertarianism, from A to Z, described as an “encyclopedic exposition of libertarian thought”, Miron explains: “Libertarianism comes in two flavors: consequential and philosophical (also known as rights-based). The two variants offer similar policy conclusions but utilize seemingly different arguments to arrive at these conclusions. Consequentialism — the path followed in this book — argues that most government interventions are undesirable because they fail to achieve their stated goals or because they generate costs that are worse than the problems they purport to fix. Consequentialism emphasizes that many policies have unintended consequences the consequentialist approach is thus just a cost-benefit calculation, albeit one with a broad view of costs and benefits. In particular, the consequentialist approach recognizes that policies have intangible and non-monetary effects, not just tangible or monetary effects. Philosophical libertarians hold that government should never infringe individual rights or freedoms.” … Miron goes on to explain that the two different versions of libertarianism are not really different, and that the explicitly consequentialist approach is the “better language” for explaining libertarianism. His video A Cost-Benefit Approach to Public Policy explains. Another interview with Miron by Reason.tv’s Nick Gillespie is at Libertarianism From A to Z With Jeffrey Miron.

  • Kansas and its own Solyndra

    At this moment, we can’t say that Kansas has its own version of Solyndra, the subsidized and politically-connected solar energy firm that recently shut down its operations and declared bankruptcy. But as far as absorbing the important lessons from Solyndra, we may have another chance to learn them in Kansas.

    Solyndra is a failure in several ways. Much money was lost. It may be that corrupt or criminal activity was involved; we don’t know that yet. It appears that Solyndra will be a useful political scandal for Republicans to exploit, especially in the upcoming election campaign against the president. We can be sure that Republicans will keep us informed on this.

    But the largest and most important lesson from Solyndra is one that many politicians — Democrats and Republicans both — don’t want to recognize: Government intervention in the economy is wrong for the health of the country.

    The problem is that when government intervenes in the economy, it almost always gets it wrong. It’s not that Obama and other politicians aren’t smart. It’s the problems inherent in government interventionism: There will be both routine and spectacular examples of waste, as people — politicians and bureaucrats, especially — are not spending their own money. Decisions will be made to benefit the well-connected and for political, not market-based reasons. Cronyism and corruption flourish, as many will find it easier to compete in the marketplace for politicians rather than in the free market where fickle consumers rule with their fleeting tastes and preferences.

    But politicians and bureaucrats love to intervene. For bureaucrats, intervention — government programs, that is — provides jobs, and well-paid jobs, too. Since much government intervention in the economy is in the form of subsidies, it allows politicians to dispense other peoples’ money and take credit for having “created” jobs or having built a bridge, probably to be named for them later on.

    Other government intervention is in the form of creating unneeded regulations or tax loopholes that favor politicians’ friends or harm their competition.

    All of this means that economic activity is directed according to political, not economic, considerations. It’s wasteful. It’s harmful. It diminishes market-based investment, that is, investment made according to what people really want and need. It reduces the freedom, liberty, and prosperity of everyone.

    Back to Kansas: Last week the Department of Energy announced the award of a $132.4 million loan guarantee to Abengoa Bioenergy Biomass of Kansas, LLC. This is the same federal agency and the same loan guarantee program involved in the Solyndra matter. The difference is that it’s an even newer so-called green energy technology involved: cellulosic ethanol production.

    The plant in Kansas is to be at Hugoton, in southwest Kansas. The press release from DOE promotes the number of jobs that will be created.

    Cellulosic ethanol is produced from plant material that is usually considered waste, such as corn stalks or wheat straw. That’s different from the usual input to ethanol production in America, which is corn that would otherwise be used as animal or human food. Because of this, cellulosic ethanol is thought of by many as the “silver bullet” that will dramatically improve the path of America’s energy future. That may be the case, or it may not be. Because of the reasons listed above, government is particularly unsuited to make that decision and to participate in the scientific and entrepreneurial experimentation that will produce the answer.

    At one time President George W. Bush praised the potential of this fuel. A Reuters analysis from July opens with: “The great promise of a car fuel made from cheap, clean-burning prairie grass or wood chips — and not from expensive corn that feeds the world — is more mirage than reality. Despite years of research, testing and some hype, the next-generation ethanol industry is far from the commercial success envisioned by President George W. Bush in 2006, when he pledged so-called cellulosic biofuels would be ‘practical and competitive’ by 2012.”

    That hints at the problem: despite much effort, scientists haven’t been able to demonstrate cellulosic ethanol production on a commercially-successful scale. According to the Wall Street Journal, as of this summer, no commercial cellulosic ethanol has been produced.

    The loan guarantee is not the only form of government subsidy and boost ethanol producers received. There is a tax credit for each gallon produced and a tariff that protects producers from cheaper imported ethanol.

    Despite these very large measures of government intervention, cellulosic ethanol backers blame the government for lack of progress in the industry, citing the government’s failure to mandate production levels and provide assurances that the industry would receive subsidies. And the loan guarantees are not made fast enough, they add to the list of complaints. An analysis by ClimateWire that appeared in the New York Times in January had industry boosters blaming the federal Department of Energy for its slow pace in issuing loan guarantees.

    We won’t know the success or failure of the Abengoa plant in Kansas for some time, and now we taxpayers are placed in the position of hoping that it succeeds. But it has the pedigree of a government plan to correct a perceived market failure, and that’s a danger sign.

    Both Kansas Senators Pat Roberts and Jerry Moran have spoken approvingly of this plant despite the government intervention involved; Moran in a statement after the announcement, and Roberts in previous years as plans were being made. U.S. Representative Tim Huelskamp, who represents the district where the plant is located, has not commented on this plant, and offered no comment for this story.

  • Kansas and Wichita quick takes: Monday October 3, 2011

    Wichita City Council. Tomorrow the Wichita City Council considers these items: First, the council will have a do-over of a public hearing it held on September 21st. The need for this arises from a mistake regarding proper notification. Mistakes like this are not uncommon at Wichita city hall. … Then the council considers revising the development agreement for the Ken-Mar TIF district. More about that at Ken-Mar TIF district, the bailouts. … The council will be asked to approve an agreement with Service Employees International Union (SEIU) Local 513 providing for pay raises of 2.5 percent per year for the next two years. … As always, the agenda packet is available at Wichita city council agendas.

    What if the NFL Played by Teachers’ Rules? Writing in the Wall Street Journal, former NFL quarterback Fran Tarkenton explains the harm of teachers unions (What if the NFL Played by Teachers’ Rules? Imagine a league where players who make it through three seasons could never be cut from the roster.): “Teachers’ salaries have no relation to whether teachers are actually good at their job — excellence isn’t rewarded, and neither is extra effort. Pay is almost solely determined by how many years they’ve been teaching. That’s it. After a teacher earns tenure, which is often essentially automatic, firing him or her becomes almost impossible, no matter how bad the performance might be. And if you criticize the system, you’re demonized for hating teachers and not believing in our nation’s children. … Perhaps no other sector of American society so demonstrates the failure of government spending and interference. We’ve destroyed individual initiative, individual innovation and personal achievement, and marginalized anyone willing to point it out.”

    Do-nothing Hoover? A new briefing paper from the Cato Institute (Herbert Hoover: Father of the New Deal) challenges the commonly-held view of President Herbert Hoover as doing nothing to prevent or fix the Great Depression. “Politicians and pundits portray Herbert Hoover as a defender of laissez faire governance whose dogmatic commitment to small government led him to stand by and do nothing while the economy collapsed in the wake of the stock market crash in 1929. In fact, Hoover had long been a critic of laissez faire. As president, he doubled federal spending in real terms in four years. He also used government to prop up wages, restricted immigration, signed the Smoot-Hawley tariff, raised taxes, and created the Reconstruction Finance Corporation — all interventionist measures and not laissez faire. Unlike many Democrats today, President Franklin D. Roosevelt’s advisers knew that Hoover had started the New Deal. One of them wrote, ‘When we all burst into Washington … we found every essential idea [of the New Deal] enacted in the 100-day Congress in the Hoover administration itself.’ Hoover’s big-spending, interventionist policies prolonged the Great Depression, and similar policies today could do similar damage. Dismantling the mythical presentation of Hoover as a ‘do-nothing’ president is crucial if we wish to have a proper understanding of what did and did not work in the Great Depression so that we do not repeat Hoover’s mistakes today.” … Well worth reading.

    Kansas school cash. “A new report this month shows that cash reserves in Kansas’ 286 school districts grew 9 percent during the year ending June 30, even as schools statewide made plans to trim staff and cut programs because of reductions in basic state aid to education. The cash reserve increase is the sixth in as many years.” See Kansas Reporter, “Lawmakers question Kansas schools’ stashes of cash.”

    John Locke to appear in Wichita. This week’s meeting (October 7th) of the Wichita Pachyderm Club presents John Locke — reincarnated through the miracle of modern technology — speaking on “Life, Liberty, and Property.” This promises to be informative and entertaining. The public is welcome and encouraged to attend Wichita Pachyderm meetings. For more information click on Wichita Pachyderm Club … Upcoming speakers: On October 14th, Lieutenant Governor Jeff Colyer, M.D. Speaking on “An update on the Brownback Administration’s ‘Roadmap for Kansas’ — Medicaid Reform” … On October 21st, N. Trip Shawver, Attorney/Mediator, on “The magic of mediation, its uses and benefits.” … On October 28th, U.S. Representative Tim Huelskamp, who is in his first term representing the Kansas first district, speaking on “Spending battles in Washington, D.C.”

  • Kansas and Wichita quick takes: Wednesday August 10, 2011

    Kansas House Appropriations Chair to speak. This Friday’s meeting (August 12th) of the Wichita Pachyderm Club Kansas Representative Marc Rhoades, Chair of the Kansas House of Representatives Committee on Appropriations, speaking on the topic “The impact of the freshman legislators on the 2011 House budgetary process.” The public is welcome and encouraged to attend Wichita Pachyderm meetings. For more information click on Wichita Pachyderm Club … Upcoming speakers: On August 19, Jay M. Price, Ph.D., Associate Professor and Director of the public history program at Wichita State University, speaking on “Clashes of Values in Kansas History.” His recent Wichita Eagle op-ed was Kansas a stage for “values showdowns.” … On August 26, Kansas State Representatives Jim Howell and Joseph Scapa speaking on “Our freshmen year in the Kansas Legislature.” … On September 2 the Petroleum Club is closed for the holiday, so there will be no meeting. … On September 9, Mark Masterson, Director, Sedgwick County Department of Corrections, on the topic “Juvenile Justice System in Sedgwick County.” Following, from 2:00 pm to 3:00 pm, Pachyderm Club members and guests are invited to tour the Sedgwick County Juvenile Detention Center located at 700 South Hydraulic, Wichita, Kansas. … On September 16, Merrill Eisenhower Atwater, great grandson of President Dwight D. Eisenhower, will present a program with the topic to be determined. … On September 23, Dave Trabert, President of Kansas Policy Institute, speaking on the topic Why Not Kansas,” an initiative to provide information about school choice. … On September 30, U.S. Representative Mike Pompeo of Wichita on “An update from Washington.”

    Sebelius responds to waivers inquiry. In June U.S. Representative Tim Huelskamp, who is in his first term representing the Kansas first district, along with others asked Secretary of Health and Human Services Kathleen Sebelius for information about the Obamacare waivers HHS has been granting. He got a response — except it’s not a response. In a statement, Huelskamp said “No details and no additional information about the Annual Limit Waivers were provided, so again we remain in the dark about this secretive process. Candidate Obama promised to be the most ‘open and transparent’ in history — a far cry from President Obama. The American people have a right to know why this new health care law is unfairly applied and what they can do to be exempted from ObamaCare. If one person, labor union, state, or business can get a waiver, then everybody should be able to get waivers.” … Huelskamp is not alone in noting the lack of transparency in the Obama administration.

    Brownback to Sebelius: No thanks. Speaking of Secretary Sebelius, Kansas Governor Sam Brownback has decided to return a grant the state received for being an “early innovator” in implementing portions of the Patient Protection and Affordable Care Act (PPACA), better known as Obamacare. A statement from the governor’s office reads: “There is much uncertainty surrounding the ability of the federal government to meet it’s already budgeted future spending obligations. Every state should be preparing for fewer federal resources, not more. To deal with that reality Kansas needs to maintain maximum flexibility. That requires freeing Kansas from the strings attached to the Early Innovator Grant. … “Federal Medicaid mandates have cost Kansans over 400 million in the past 2 years alone. Full implementation of the mandates in the President’s health care law would cost billions more,” said {Lieutenant Governor] Dr. [Jeff] Colyer. “We will work to find innovative Kansas based solutions to Kansas challenges and be very selective in the federal funds the state applies for and receives. We look forward to working with legislative leaders and Insurance Commissioner Praeger as we develop Kansas solutions.”

    ‘Nullify Now’ tour in Kansas City. The idea that states can nullify unconstitutional laws passed by Congress is gaining traction as a way to reign in the federal government. Next week an event in Kansas City will help citizens learn more about this possibility. Writes the event’s organizers: “Crushing debt, health care mandates, ‘super’ congress, and more. The list of constitutional violations from DC never seems to end. The good news is that we don’t have to wait for DC to fix itself. As Thomas Jefferson told us, state nullification is “THE RIGHTFUL REMEDY” to unconstitutional actions by the federal government. … At Nullify Now! Kansas City, you’ll hear nationally-renowned speaker Thomas Woods (and nine others) present the constitutional case for nullification. You’ll learn: the constitutional basis for nullification, how nullification has been used in history, how nullification is being called upon right now vs Obamacare, to protect gun rights, against the TSA, and more, and what YOU CAN DO RIGHT NOW to get your state to put a stop to the Feds.” The event is Saturday August 20, and tickets, ranging in cost from free to $75, are required. For more information click on Nullify Now! Kansas City.

    ‘Birth of Freedom’ screening. On Monday (August 15th) the film The Birth of Freedom will be shown for free in Wichita. The film is a product of the Acton Institute, whose mission statement describes the institute as “[promoting] a free and virtuous society characterized by individual liberty and sustained by religious principles.” This free event is Monday from 7:00 pm to 8:30 pm at the Lionel D. Alford Library located at 3447 S. Meridian in Wichita. The library is just north of the I-235 exit on Meridian. The event’s sponsor is Americans for Prosperity, Kansas. For more information on this event contact John Todd at john@johntodd.net or 316-312-7335, or Susan Estes, AFP Field Director at sestes@afphq.org or 316-681-4415. … I’ve been told by those who have viewed the film that it is a very moving presentation. A trailer or preview may be viewed below.

  • Kansas and Wichita quick takes: Wednesday August 3, 2011

    Debt ceiling. What is the real value of the debt ceiling? Has it ever constrained the growth of government debt, until now? Thomas Sowell in Debt-Ceiling Chicken: “Some people may have been shocked when the credit-rating firm Moody’s recently suggested that the debt-ceiling law be repealed, in order to avoid fiscal crises which can throw world financial markets into turmoil that can injure countries around the world. Anyone who wants to show that Moody’s is wrong should be prepared to show the actual benefits of the debt-ceiling, not its goals or hopes. That will not be easy, if possible at all. … The national debt-ceiling law should be judged by what it actually does, not by how good an idea it seems to be. The one thing that the national debt-ceiling has never done is to put a ceiling on the rising national debt. Time and time again, for years on end, the national debt-ceiling has been raised whenever the national debt gets near whatever the current ceiling might be. Regardless of what it is supposed to do, what the national debt-ceiling actually does is enable any administration to get all the political benefits of runaway spending for the benefit of their favorite constituencies — and then invite the opposition party to share the blame, by either raising the national debt ceiling, or by voting for unpopular cutbacks in spending or increases in taxes.”

    Was August 2nd a deadline? All through the debate over raising the federal debt ceiling it was taken as granted that the deadline — the day the U.S. Treasury would run out of money — was August second. U.S. Representative Tim Huelskamp, who is in his first term representing the Kansas first district, has released data that shows otherwise. A chart on his website shows a declining balance in the treasury, but projections show a positive balance far past August second.

    Despite drag of government health care, Canada thrives. The unemployment rate in Canada has fallen, GDP growth is healthy, and there were no bank bailouts. It has been able to reduce the size of its government relative to its economy, writes Jason Clemens in Why Canada Is Beating America: It shrank government, and now unemployment and debt are declining: “Total government spending as a share of the economy peaked at a little over 53% in 1993. Through a combination of spending cuts in the 1990s and spending restraint during the 2000s, it declined to a little under 40% of GDP by 2008.” … For 2010, government spending at all levels in the U.S. amounted to 36.22 percent of GDP, according to the Bureau of Economic Analysis. While that compares favorably with Canada’s level, the trend in the U.S. is for spending to increase, having risen from 30.82 percent in 2004. … According to Clemens, the success of Canada’s economy is in spite of its government health care, not because of it: “The unavoidable challenge is the country’s health-care system. … Canada devotes a relatively high share of its economy to health care without enjoying commensurate outcomes. Of the 28 countries in the Organization for Economic Cooperation and Development (OECD) that have universal access, Canada has the sixth-highest rate of health spending as a share of its economy.” It would be one matter if Canadians enjoyed good results from all this health care spending. “But Canadians’ access to care is poor, despite high spending. The country ranks 20th of 22 OECD countries for access to physicians. … Waiting times for treatment continue to worsen.” … Liberals in the U.S. point to Canada as a model for government health care, but the actual situation is not one that we should aspire to.

    Kansas government website revamped. Kansas has remodeled its main website, kansas.gov. Besides a new look, I think a useful feature will be the use of a Google site-specific search feature. These generally work very well, applying the power of the popular and effective search engine to a specific website. Time will tell as to whether the design is useful. The state does not have a good record in recent times of website redesigns, as the effort to replace the legislature’s website right as the session started was a disaster. The press release with other details is at New State Web Portal Provides Better Experience, Mobility.

    Demand is not the problem. A recent letter to the Wichita Eagle started with “The only thing that creates jobs is demand for product.” This idea of economic wealth deriving from consumer demand is a Keynesian concept, and we’ve seen over and over the wreckage that Keynesian economics leaves on countries — starting with our own efforts to cure the Great Depression to the failing economic policies of President Barack Obama. It’s also curious to blame economic stagnation on the absence of desire of people for more stuff. People want more stuff — that’s human nature. It is by producing more that we create the wealth necessary to satisfy our demands. Production benefits from capital formation, and the policies of the United States are not favorable for this. … The author also promotes increasing exports while at the same time urging Americans to buy only U.S.-made products. This ignores the fact that trade — no matter who the trading partner — is a source of wealth. Both parties are made better-off through trade; otherwise the transaction would not take place.

    Debt ceiling bill. A budget cut only by Washington standards. “Throwing in the towel.” All the angst over the past month seems to have produced very little in the way of meaningful reform. Here several Cato Institute policy experts comment on this week’s lawmaking. “This week’s bipartisan deal to raise the debt limit and achieve some spending reductions will do little in the way of actual spending cuts, defers all the tough decisions on spending and debt to a “SuperCongress” committee and will do little to protect the United States credit rating. Cato Institute Senior Fellows Dan Mitchell and Jagadeesh Gokhale and Director of Tax Policy Studies Chris Edwards comment on the debt deal.”

  • Kansas and Wichita quick takes: Friday July 1, 2011

    This Week in Kansas. On this week’s edition of the KAKE Television public affairs program This Week in Kansas, Ken Ciboski (Associate Professor of Political Science at Wichita State University), John D’Angelo (Arts & Cultural Services Manager for the City of Wichita), and myself join host Tim Brown for a discussion of arts and government funding in Kansas. This Week in Kansas airs in Wichita and western Kansas at 9:00 am Sundays on KAKE channel 10.

    Kansas taxes. A short report produced by Americans for Prosperity, Kansas shows some of the reasons why economic growth in Kansas has been sluggish: “Kansas’ state and local tax burden continues to be amongst the highest in the region.” Kansas has fewer private sector jobs than it did ten years ago. And in what should be a grave cause for alarm, Kansas was the only state to have a net loss of private sector jobs over the last year. … A table of figures illustrates that although Oklahoma kept its sales tax rate low and constant while Kansas increased its rate, tax revenue increased much more in Oklahoma. Download the report at AFP-Kansas Income Tax Policy Primer.

    Wichita sales tax. Speaking of sales tax and its harmful effect, Wichita seems to want to raise its rate. Proposals have been floated for a sales tax for economic development in general, for increased transit (bus) service, for drainage projects, and for downtown projects. Boosters cite the Intrust Bank Arena as an example of a successful project paid for by a sales tax that disappeared as promised. That’s despite the dreams of Sedgwick County Commissioner Tim Norton: “Then, as that tax was nearing its end, Norton ‘wondered … whether a 1 percent sales tax could help the county raise revenue.’ (‘Norton floats idea of 1 percent county sales tax,’ Wichita Eagle, April 4, 2007)” … Boosters of the arena promote it as a financial success, and there was the presentation to the county of a check for $1,116,442 as its share of the arena’s earnings. This figure, however, does not represent any sort of “profit” or “earnings” in the usual sense. In fact, the introductory letter that accompanies these calculations warns readers that these are “special-purpose financial statements” and “are not intended to be a presentation in conformity with accounting principles generally accepted in the United States of America.” In particular, Commissioner Karl Peterjohn has warned that these figures — and the monthly “profit” figures presented to commissioners — do not include depreciation expense. That expense is a method of recognizing and accounting for the large capital cost of the arena. In April the County released that number, and I believe it has not been reported by any news media. That may be because the number is pretty big — $4.4 million, some four times the purported “earnings” of the arena. … Without honest discussion of numbers like these, we make decisions based on incomplete and false information. Don’t look for many local government leaders and officials to talk about this number, and certainly not the Wichita Eagle editorial page.

    Koch criticism backfires — again. For those who follow the issue, it’s no surprise that Lee Fang, a reporter for the liberal think tank Canter for American Progress has come out with another attack on Charles and David Koch. Mark Hemingway of the Weekly Standard reports on this effort: “Think Progress reporter Lee Fang has a long history of being spectacularly wrong. However, there’s a seemingly unending thirst for his breathless demonization of the Koch brothers and other rants about corporate greed among the low IQ end of the liberal spectrum.” Fang disagrees with a recent U.S. Supreme Court decision, and he lambasts the litigators who brought the suit as “heavily financed by right-wing corporate money, particularly from Koch Industries and Walmart.” He also criticizes organizations for not dislosing their donors. Hemingway notes this: “In the case of the Koch brothers, they have been outspoken philosophical libertarians for decades. Their support of free speech over onerous campaign laws is entirely consistent and should not be surprising. However, in the case of Wal-Mart Fang is also astoundingly hypocritical. Because you know who else is a ‘Walton-Funded Group’? Lee Fang’s employer.” And the secret donations that Fang rails against so passionately? Hemingway again: “You know who else accepts ‘secret donations from individuals and corporations’? That’s right — the Center for American Progress.” … For another example of Fang’s reporting, see ThinkProgress and Lee Fang: wrong again.

    Tension on debt ceiling issue. In The Wall Street Journal Kimberly Strassel writes that the current debt and spending crisis may lead to an end to farm subsidies, something she described as a “sacred federal spending cow:” “For decades, the House and Senate agriculture committees have been the last redoubts of congressional bipartisanship, liberals and conservatives united in beating back any outside attempts to cut off tens of billions annually for price supports, crop insurance, weather assistance, conservation handouts and nutrition programs. The last real stab at reform was the mid-1990s Freedom to Farm bill. Most of the changes were obliterated by subsequent bailouts and new spending.” … She describes how Arizona Congressman Jeff Flake got a limit of farm subsidies through the Appropriations Committee, but House Agriculture Committee Chairman Frank Lucas used a maneuver to block Flake’s proposal. So much for that effort at reform, blocked by a Republican. Lucas’ website promotes a conservative message, with one post criticizing bailouts. But not for farmers, it seems. … Wichita’s Mike Pompeo is mentioned: “Mr. Pompeo is waiting to see what debt package emerges and says his vote will depend on whether it contains real ‘structural’ reform. But he also tells me he doesn’t intend to let parochial interests cloud his decision. ‘I came here to be a small-government guy every day, and not just when it is spending cuts in somebody else’s district,’ he says.” … Although not mentioned in this article, Tim Huelskamp, who represents the Kansas first district, has been upfront in discussing the need to reduce or eliminate farm subsides, and so far, many farmers seem to be accepting of that. Huelskamp’s district, which covers all of western Kansas (and more), is usually second on the list of congressional districts in terms of total farm subsidies received. For 2009, that figure was $369 million.

    Stossel: The Money Hole. A recent episode of John Stossel’s television program is now available on the free hulu service by clicking on The Money Hole. Writes Stossel in his introduction to the show: “We will soon spend ourselves into oblivion. But finally … movement! Budget slashing proposals from Paul Ryan, the Republican Study Committee, Ron Paul, Rand Paul and even Tim Pawlenty! But politicians and real people across the spectrum still resist change. What should government do? What’s its role? What have other countries done? The Money Hole tackles that.”

  • Kansas and Wichita quick takes: Monday June 27, 2011

    Wichita city council. This week the Wichita City Council considers consent agenda items only, and then has a workshop. Among the consent agenda items are a resolution declaring the city’s intent to use debt financing in the amount of $40 million for the new parking facility at the airport. A companion resolution declares intent to use $160 million in debt financing for the new terminal. Interestingly, these resolutions contain this language: “That a public necessity exists for, and that the public safety, service and welfare will be advanced by …” followed by a description of each project. Really, the city should not lie in this way. … Consent agendas are handy for hiding items like this item: “Authorize payment of $13,025 as a full settlement for all claims arising out of an automobile accident. … This claim arose from a May 31, 2011 automobile accident involving an OCI inspector employed by the City.” … Of interest in the workshop session is an item titled “WSU Economic Development Fiscal Impact Analysis Model.” Here, undoubtedly, analysts from Wichita State University Center for Economic Development and Business Research will tell the council how government spending has a magical power not found in private sector spending.

    Huelskamp on spending as driving economic growth. Speaking of the magical power of government spending, in his questioning (video below) of Congressional Budget Office (CBO) Director Douglas Elmendorf last week, U.S. Representative Tim Huelskamp, who represents the Kansas first district asked if reducing spending is not the best way to grow the economy. Elmendorf replied that there are trade-offs; that higher marginal tax rates do reduce economic activity to some extent. But, he added, that certain forms of government spending are important for economic growth. Huelskamp pressed the director, noting that in his recent report, higher marginal tax rates and more government borrowing are negative factors on growth, asking “So explain to me why reducing spending is not the only alternative?” Director Elmendorf explained cutting spending “that was not itself an investment in economic growth, that would be better for the economy than if one raised [marginal tax rates].” … Huelskamp asked if Medicare and Social Security spending were economic growth drivers. The answers were no, they are not important economic growth drivers in the long term. Some pieces of the defense budget have been, he said. Huelskamp noted we’ve just eliminated a huge chunk of the federal budget as being important to economic growth. … Elmendorf said he did not have a list of the types of federal spending that have been important to economic growth, and he admitted that “we are not good at modeling those effects.” … Huelskamp asked Elmendorf if he could, as follow-up, provide examples of federal government spending that are drivers of economic growth, saying that Ben Bernanke, the Chairman of the Federal Reserve System refuses to identify those. … We’ll have to wait and see how the CBO responds. The report Huelskamp referred to is CBO’s 2011 Long-Term Budget Outlook.

    No Wichita Pachyderm this week. Because of the holiday, the Wichita Pachyderm Club will not meet this week. Upcoming speakers: On July 8, Dave Trabert, President, Kansas Policy Institute, on “Stabilizing the Kansas Budget.” On July 15, Jon Hauxwell, MD, speaking on “Medicinal Cannabis.” On July 22, U.S. Representative Mike Pompeo of Wichita on “An update from Washington.” On July 29, Dennis Taylor, Secretary, Kansas Department of Administration and “The Repealer” on “An Overview of the Office of the Repealer.”

    Government spending secrets. Erick Erickson, RedState: “How bad is Washington spending? Well, there is a new website that’s up called Dirty Spending Secrets with a Q&A format to uncover some of Washington’s dirtiest spending secrets. Several friends of mine have emailed it to me. It’s actually pretty easy to figure out, but also horribly shocking — in the Q&A multiple choice, just go for the worst answer and you’ll probably be right. With the debt ceiling vote coming up, it’s just another reminder of how unserious Washington is when it comes to spending.”

    Wichita city budget input. It’s budget time in Wichita, and the city will take questions and public input this Wednesday (June 29) in a 6:00 pm session in the city council chambers. The event will be broadcast live on the city’s network on Cox cable television channel 7, and questions may be emailed to budgetquestions@wichita.gov

    Fracking facts. The Wall Street Journal has a run-down of the facts about the risks involved in fracking. This is a new technology that has greatly increased the amount of natural gas available in the U.S. and has caused the price (per million British thermal units) to decline from $15 to $4. For example, opponents of fracking claim that the process, in which water and chemicals are injected underground to free gas from confinement in shale formations, contaminates groundwater. Counters the Journal: “The problem with this argument is that the average shale formation is thousands of feet underground, while the average drinking well or aquifer is a few hundred feet deep. Separating the two is solid rock. This geological reality explains why EPA administrator Lisa Jackson, a determined enemy of fossil fuels, recently told Congress that there have been no ‘proven cases where the fracking process itself has affected water.’” … There are risks, of course, to any undertaking like this, and in conclusion the Journal recommends: “Amid this political scrutiny, the industry will have to take great drilling care while better making its public case. In this age of saturation media, a single serious example of water contamination could lead to a political panic that would jeopardize tens of billions of dollars of investment. The industry needs to establish best practices and blow the whistle on drillers that dodge the rules. The question for the rest of us is whether we are serious about domestic energy production. All forms of energy have risks and environmental costs, not least wind (noise and dead birds and bats) and solar (vast expanses of land). Yet renewables are nowhere close to supplying enough energy, even with large subsidies, to maintain America’s standard of living. The shale gas and oil boom is the result of U.S. business innovation and risk-taking. If we let the fear of undocumented pollution kill this boom, we will deserve our fate as a second-class industrial power.”

    Even quicker. Gallup: Americans Regain Some Confidence in Newspapers, TV News: “Americans’ confidence in newspapers and television news rebounded slightly in the past year, having been stuck at record lows since 2007. The 28% of Americans who express a great deal or quite a lot of confidence in newspapers and the 27% who say the same about television news still lag significantly behind the levels of trust seen through much of the 1990s and into 2003.” … Rasmussen on health care: 55% favor health care repeal, just 17 percent say new law will improve quality of care. … Politico: 2012 contenders shun Hill support: “Across Capitol Hill, Republican lawmakers report scant interaction with presidential hopefuls. The chase for congressional backing has been moving at a snail’s pace this year compared with the previous election cycle, a reflection of the slowly forming presidential field, concern in Congress about the strength of the candidates and a desire by White House hopefuls to keep their distance from an unpopular Washington.” … Picket: Bozells look to grow conservative ‘social media army’: “Mr. [Brent Bozell, president of Media Research Center] explained, ‘We looked across the landscape and then across conservatism and we thought that was one thing that was lacking. We weren’t taking advantage of the tools that the Left was taking advantage of with good success and what we found was that there was hunger out there.’” He should have been at AFP’s RightOnline conference in Minneapolis last week. MRC was represented, though. … Investor’s Business Daily Editorial: How Big Government Strangles The Job Creators: “The secretary of the Treasury says taxes must be raised on small business so the federal government can stay big. With that breathtaking statement, he helpfully mapped out the key difference between the parties. … ‘If you don’t touch revenues,’ Geithner said, ‘you have to shrink the overall size of government programs, things like education, to levels that we could not accept as a country.’”

  • Huelskamp at RightOnline: Debt is the problem

    At the RightOnline conference in Minneapolis, U.S. Representative Tim Huelskamp of the Kansas first district told the general session audience that federal spending and debt is a threat to the future of America, and that we must use the opportunity of the upcoming debt ceiling vote to force spending cuts.

    Introduced by Alan Cobb of Americans for Prosperity as someone who — in his first race for the Kansas Senate — beat the best kind of Republican to beat: “one of those squishy ones.” Huelskamp served 14 years in the Kansas Senate, and was elected to the House of Representatives last November.

    A leader in technology, he was the first Kansas legislator to have a laptop computer in the chamber, and was instrumental in passing Kansas’ online transparency bill. And, Cobb said, he was the first member of Congress to bring an Ipad to the speaker’s podium.

    In his remarks to the audience, Huelskamp said he was one of those new “testy freshmen.” He said he spent the first few months wondering around Washington wondering how he got here, then he started to wonder how those other guys got here.

    He described listening to budget debate on the House floor. In response to what a leftist Member said, he turned to a senior Republican and said “Do they really believe what they just said, or are they lying?” The response: They really believe what they’re saying. They really believe that government can do better with your money than you can, and that the stimulus didn’t work because it was too small, he said.

    Washington is about hypocrisy, he told the audience. They have a plan for themselves, and another plan for the rest of us. ObamaCare and the health care waiver process is an example of this. Dozens of labor unions spent hundreds of millions to elect President Obama and to push his health care plan through, only later to receive an exemption from its provisions.

    Huelskamp said he had held done 58 town halls this year so far. One thing people ask him, he said, is if he’s living under the rules they set for everyone else. He also asks the question “Do you think the next generation of Americans will be better off than your generation?” The American Dream is in jeopardy, he said. We are sitting at the precipice of our nation’s history. “Are we going to go the direction of our Founders — freedom and liberty — or are we going to go the direction of slavery and socialism? That’s the choice we have today.”

    In Washington, Huelskamp said that Ben Bernanke, the Chairman of the Federal Reserve System, says we can “use the debt ceiling as a lever to change America.” Huelskamp said that despite the risk of being accused a contrarian, that’s exactly what we need to do. Calling the debt ceiling an “opportunity of a lifetime,” he said that we must keep on the pressure to extract spending cuts. The votes are very close, he said.

    Huelskamp said we must “act as if we have no time left.” We must face our debt crisis now. We can’t put off decisions. It is a spending problem, he said, a power problem. It is Washington telling us what to do with our own money.

  • Kansas and Wichita quick takes: Wednesday June 1, 2011

    Transportation planning. It’s been the assumption in America over the last half-century that transportation needs — roads, bridges, buses, subways, etc. — must be planned by government in a top-down fashion. But the Cato Institute’s Randal O’Toole disagrees: “Should transportation be funded and planned from the top down or bottom up? Top-down advocates, such as the Brookings Institution’s Robert Puentes (writing in the May 23, 2011 Wall Street Journal) argue that only central planners can have a ‘clear-cut vision for transportation’ that will allow them to target spending ‘to make sure all those billions of dollars help achieve our economic and environmental goals.’ Advocates of bottom-up funding, such as the Cato Institute, Reason Foundation and Heritage Foundation, respond that public and private transportation providers better serve our needs when they are responsive to the fees people pay for various forms of transportation. In fact, most of the problems with transportation today, from an antiquated air-traffic control system to deteriorating bridges to empty transit buses, are due to top-down planning.” O’Toole goes on to explain the problems with federal funding of local transportation projects, concluding “No matter how well intentioned, top-down transportation planning quickly turns into a combination of social engineering and pork barrel. It is time to return to a bottom-up funding system that rewards transport agencies and companies for reducing costs and increasing mobility.” … In Wichita, the bus transit system is running a deficit, and the city manager has warned that cuts to service may be made. Most people would be surprised that in 2009, the fares paid by passengers covered just 22.5 percent of the bus system’s total cost, according to Michael Vinson, Director of Transit for the City of Wichita. The Wichita Eagle recently reported the figure as just 20 percent. The rest of the cost is covered by a variety of local, state, and federal grants. … Is it a coincidence that Wichita’s bus service is a top-down government-planned service? And what does this foretell for the future of other government-planned and provided transit, which is said by government planners like the Wichita Downtown Development Corporation to be necessary for the revitalization of downtown Wichita

    Pompeo, Huelskamp ‘no’ on debt limit. U.S. Representative Mike Pompeo, a Wichita Republican serving his first term, voted “no” to increasing the U.S. federal debt limit, which currently is about $14.3 trillion dollars. In a statement, Pompeo said; “I voted no on raising the debt ceiling. No to more debt without a change in behavior. No to increasing the credit card limit when the Obama Administration has zero commitment to reducing the unsustainable rate of spending. No to business as usual in Washington, D.C. … With this debt ceiling vote, my colleagues and I are putting down a marker on behalf of the American people. Americans have rejected the status quo and sent me along with 86 other Republican Freshmen to Congress to reverse course. Earlier this year, the President presented a spending plan to Congress for 2012. Unfortunately, that plan proposed 10 straight years of deficits in excess of $1 trillion. That is a recipe for disaster and one which we cannot accept on behalf of the Americans who sent us here to rein in out-of-control government spending.” … In explaining his intent to vote against the bill, Tim Huelskamp, who represents the Kansas first district, said: “The President’s request to increase the debt limit without cutting spending is irresponsible and fiscally reckless, therefore I plan to vote against it. The acquisition of more debt while failing to deal with Washington’s addiction to spending only sustains Washington’s unhealthy behaviors. It puts the country on the path of Greece. We owe it to the American people and to future generations to deal with overspending once and for all.” Lynn Jenkins and Kevin Yoder, the other representatives from Kansas, also voted against raising the debt limit. … Proponents of federal spending insist that we must increase our debt limit or financial markets will tank and economic activity will come to a halt. The Concord Coalition writes: “Approval of a debt limit increase is necessary to maintain the full faith and credit of the United States government. Failure to approve an increase would not be an act of fiscal responsibility, unless it can be said that deadbeats are fiscally responsible because they refuse to pay their bills. It would result in the United States defaulting on the commitments it has already made, including Social Security, Medicare and veterans benefits, vendor payments, tax refunds, student loans and interest payments on outstanding debt.” The Cato Institute counters: “A temporarily frozen debt limit could instead signal U.S. lawmakers’ resolve to get our fiscal house in order. It may even reassure investors about long-term U.S. economic prospects. … For too long, analysts and politicians have balked at the massive political impediments to reforming the federal budget — especially entitlement programs. Many now concede, actually, that no prudential reforms are likely unless there is an imminent ‘crisis.’ On the other hand, political liberals argue that there is no real ‘crisis’ — and so no need for real reforms. … Indeed, investors should be fearful of the opposite: an increase in the debt limit without a serious challenge from reform-minded lawmakers. This only signals business as usual for U.S. fiscal affairs.”

    This Week in Kansas. Recently the KAKE Television public affairs program This Week in Kansas started placing episodes on its website. On the most recent episode, Malcolm Harris and I join host Tim Brown for a discussion of the Kansas Legislature and economic development topics. Also, Meteorologist Jay Prater contributes a segment on storm preparation.

    Kingman is the first. The office of Kansas Governor Sam Brownback has announced that Kingman County, just to the west of Wichita, is the first county to participate in the new Rural Opportunity Zone student loan repayment program. This program allows residents who move into counties with declining population to escape paying state income taxes for five years. In deciding to participate in the student loan repayment program, the county and the state will participate equally in repaying student loans of up to $15,000 for college graduates who move to Kingman County. … In a statement, the governor said “I am pleased Kingman County commissioners recognize the direct benefit of partnering with the state to attract college graduates to their community. This aggressive policy move is targeted to grow our shrinking rural counties. Like the Homestead Act, ROZ offers opportunity instead of handpicking winners and losers.” While almost all welcome the ROZ program — the legislation passed 102 to 18 in the House and 34 to 5 in the Senate — the nostalgia for the glory days of small-town Kansas may not be in our best interests. In his paper Embracing Dynamism: The Next Phase in Kansas Economic Development Policy, which has influenced Governor Brownback’s economic policy, Dr. Art Hall wrote that productivity — which should be our ultimate goal — is related to population density: “Productivity growth is the ultimate goal of economic development. Productivity growth — the volume and value of output per worker — drives the growth of wages and wealth. Productivity growth results from a risky trial and error process on the front lines of individual businesses, which is why Kansas economic development strategy should focus on embracing dynamism — a focus virtually indistinguishable from widespread business investment and risk-taking. Productivity growth tends to happen in geographic areas characterized by density. This pattern shows up in Kansas. The dense population centers demonstrate superior productivity growth.”

    Legislature is through for season. Today both the Kansas House of Representatives and Senate met for sine die, a fancy Latin term for its ceremonial last day, although action may be taken. The House made an attempt to override the governor’s line-item veto of funding for the Kansas Arts Commission, but the effort failed by a vote of 50 to 44. Two-thirds, or 84 votes, would be needed to override the veto. The Senate didn’t make an attempt. The next meeting of both chambers of the Kansas Legislature will be on January 9, 2012, although there are many committee meetings during the summer and fall months.

    Stossel looks at energy. In a recent episode of his weekly television show available to view using the free hulu service, John Stossel looks at various forms of energy and asks: Who will keep the lights on? … Early in the show, Stossel argues with Bill O’Reilly over the role of speculators in the run-up of oil prices. O’Reilly favors strict regulation of speculators, believing that the market is rigged. In a discussion with two guests, wild speculation was promoted as the cause of rapidly rising prices, with some trades by traders said to be stoned at the time. But it was mentioned that speculation carries huge risks, and if the speculators are wrong, they lose — and big. For more on speculators, see Speculators selfishly provide a public service.