IPI PolicyBytes | Categorised Content

TaxBytes 7.23: A Penny Saved Is a Penny Not Spent—on Politics

Merrill Matthews Jr. — Mon, 14 Jun 2010 17:58:48 -0500

When a child wastes his allowance on foolish things, wise and prudent parents will be reluctant to hand over more money if that child comes begging. And that’s just how taxpayers should feel about a new effort to bailout labor union pensions.

Pennsylvania Senator Bob Casey has introduced the “Create Jobs and Save Benefits Act,” otherwise known as the “Buy Union Votes and Boost My 2012 Reelection Chances” bill. In essence, the bill would transfer billions of dollars in unfunded pension liabilities from mostly union-managed multi-employer pension plans to the Pension Benefit Guaranty Corporation (PBGC), which is backed by taxpayers.

But even as unions push for taxpayers to fill the gap in their underfunded and mismanaged pension plans, they drop millions of dollars in union dues on political causes.

TaxBytes 7.21: Debunk and Defund

Merrill Matthews, Jr. — Tue, 1 Jun 2010 16:32:45 -0500

Republicans have kicked off their ObamaCare “repeal and replace” campaign, but there will likely be neither repeal nor replace unless Republicans control both Congress and the White House, and that’s 2012 at best — if then. However, by taking over only one house of Congress opponents can dramatically lower the unsustainable cost of ObamaCare by refusing to fund its worst elements. Here’s a few suggestions.

Reduce Medicaid eligibility. Historically, states have varied widely on Medicaid eligibility, with some setting the threshold significantly below the federal poverty level (FPL). ObamaCare sets a nationwide eligibility threshold at 133 percent, which increases the number of people in the government-run program by an additional estimated 15 million by 2019. Funding Medicaid eligibility only up to 100 percent of FPL would dramatically lower its cost.

Ignorant and Arrogant

Tom Giovanetti — Fri, 14 May 2010 15:54:33 -0500

Lost in all the discussion about how irresponsible it was for U.S. Attorney General Eric Holder to express concerns and opinions about Arizona's recently passed immigration law without having read it is something that's even more astonishing (and arrogant) to me.

He also showed up at a Congressional hearing without adequately prepping for the hearing.

Holder had to know he'd be asked about the Arizona law, and especially about the fact that he hadn't yet read the law when he made his comments over the weekend. But, knowing this, he still hadn't bothered to read the law in preparation for Thursday's hearing?

This is just astonishing to me, insulting to Congress, and indicative, I think, of the arrogance of this administration.

Was Sen. Robert Bennett not conservative enough?

Tom Giovanetti — Wed, 12 May 2010 21:20:29 -0500

When an 18-year incumbent Senator is defeated in his party nominating process, apart from scandal, that's a shock to the system, and it's no wonder every pundit has an opinion on the matter.

Trouble is, they're almost all wrong.

Typical of the chatter is Juan Williams, who reacted:

"A guy like Bob Bennett, who is a right-wing conservative, is being driven out because he's not sufficiently conservative?"

Juan Williams misses the point, and in the process forgets that "conservative" means more than pro-life and pro-gun. Conservative also means, at least it used to mean, responsible in fiscal matters as well as in sexual and social matters. Limiting government spending, and especially limiting government's role in the economy. And, in the worst case scenario, if a gradual expansi

TaxBytes 7.17: A Short, Painful Lesson on ‘Benefits Cuts’

Merrill Matthews, Jr. — Tue, 4 May 2010 15:14:58 -0500

On Fox News Sunday, anchor Chris Wallace asked Florida U.S. Senate candidate Marco Rubio, a Republican, if he still stood behind a statement he had made on the program a month earlier that he would support Social Security benefit cuts for people under the age of 55.

Rubio confirmed that he did, and went on to add that he believed all serious observers agreed that benefits would need to be cut.

We disagree, but more about that in a minute.

If we lived in a “post-partisan” political world, where ideas could be proposed and discussed in an intelligent manner, then we could have a rational discussion about benefits cuts.

But Washington’s political divisiveness has become a national embarrassment, with name calling, and scoldings and massive pieces of legislation being forced through without one single vote from the minority party.

TaxByte 7.12: Obamacare and Obamaccounting

Merrill Matthews Jr. — Tue, 30 Mar 2010 16:06:35 -0500

I predict that one of the most common phrases in the American vocabulary over the next few years will be, “I didn’t know the health care bill would do that.” And Democrats will be saying it most.

Even as the president traveled to Iowa City to let everyone know Armageddon hadn’t happened, several large companies declared they would start health-reform-related write downs--AT&T for $1 billion.

Here’s the back-story. In 2003, Congress passed the Medicare prescription drug benefit. There was a concern among legislators that including that benefit might encourage large employers that provided retiree coverage to phase it out.

Republicans, who controlled Congress, decided to provide those companies with a subsidy, spending about $665 per retiree to subsidize the employer’s plan, but saving $1,209 if the retiree had been dumped into Medicare.

TaxBytes 7.09: On the House

Merrill Matthews Jr. — Tue, 9 Mar 2010 13:50:40 -0500

Members of Congress say they are concerned about the exploding budget deficit, though not so concerned, it seems, to stop all the spending that’s actually causing the deficit explosion—up to about 24.7 percent of gross domestic product (GDP).

President Obama’s solution has been to appoint, by executive order—because the Senate wouldn’t pass it—a bipartisan group to explore what the government can do to reign in the spending.

It’s like an alcoholic convening a meeting of other heavy drinkers to discuss how the alcoholic can cut back on his drinking—and having the meeting at a bar at happy hour.

Of course, everyone knows the committee will recommend some minor spending cuts and some major tax increases. The tax increases would pass and the spending cuts would be postponed until later—because spendaholics don’t really want to cut spending, they just want to say that they do.

TaxBytes 7.08: Believe What I Say, Not What I Do

Merrill Matthews Jr. — Tue, 2 Mar 2010 14:34:35 -0500

Senator Jim Bunning could probably use a hug.

The retiring Kentucky Republican has been trying to get Congress to live up to its fiscal promises. And for that good deed he’s getting pummeled by Democrats, barraged by reporters and largely ignored by Republicans.

This is not a good sign for all that promised future austerity by either party.

Congress passed a new version of “pay as you go,” or “paygo,” legislation in February when it increased the government’s borrowing limit to $1.9 trillion. The goal of paygo is to force the government to find ways to offset any new spending. Democrats included the provision to help deflect criticism for their explosion in deficit spending.

President Obama showered it with praise: "PAYGO would hold us to a simple but bedrock principle: Congress can only spend a dollar if it saves a dollar elsewhere.

SoundBytes 224: What Will the President Say in His State of the Union?

Merrill Matthews Jr. — Wed, 20 Jan 2010 14:43:09 -0500

What Will the President Say in His State of the Union? The Institute for Policy Innovation’s Dr. Merrill Matthews says he has some explaining to do.

Washington is all atwitter over President Obama’s upcoming State of the Union address. And understandably so, because the president has some serious explaining to do, like:

How he plans to get control of the $1.4 trillion federal deficit, more than three times the deficit Obama was so critical of under George Bush.

And how he intends to pay for all the Democrats’ new federal spending. Yes, he could raise taxes, but he already has several new taxes in his health care bill.

And maybe the president can explain why his much-boasted stimulus bill has had little impact on creating new jobs.

TaxBytes 7.02: The Game Is Changing

Merrill Matthews Jr. — Tue, 19 Jan 2010 14:44:44 -0500

Something remarkable is going on in America.

I can’t quite explain it; I’m not sure anyone can. But we can use Democratic Senator Ben Nelson of Nebraska to exemplify the change.

In order to “persuade”—some might say “payoff”—Nelson to vote for Senator Harry Reid’s health care reform bill, Reid agreed that the federal government would pay Nebraska’s portion of the increased Medicaid cost—forever.

Nelson can be forgiven for thinking his so-called “cornhusker kickback” would be hailed back home as a great achievement because, in the past, it would have been. Trying to maximize federal revenue is like a state hobby.

And Reid certainly thought Nebraska would approve. Why, he essentially called the other states a bunch of chumps for not getting their own kickback.