Tag Archives: poor

If Taxes are the Solution, What’s the Problem?

by Cameron Smith

Alabama’s legislative leadership and Governor are under immense pressure in Montgomery to increase taxes to prevent cuts in state government funding. But is the real problem a lack of revenue?

The cuts themselves seem to be the most obvious source of consternation. So far, some Alabama agencies are engaging in spending reductions through attrition, not filling vacancies as current staff departs while others delay upgrades or capital purchases. In other words, state agencies seem to be doing what they can to prevent laying off employees. But, at some point, fewer employees tasked with administering the same government programs in the same manner may inevitably lead to reduction in state services or the elimination of state programs.

In many respects, these reductions create heartburn because the programs that may be eliminated are “good” programs. For example, Alabama’s Department of Human Resources will close an adult day-care program that enrolls about 380 people. The closure of the program will save taxpayers over two million dollars annually.

However, for the 380 people enrolled in the day-care program and their families, the elimination of the program means the removal of a substantial benefit. In a very real and meaningful sense, a good program is being terminated. But even if a thousand people are negatively impacted by the elimination of the program, how does their interest stack against the other 4.8 million Alabamians who would rather see those resources go in a different direction or remain in the pockets of taxpayers?

The immediate response that the adult day-care program and others like it should be preserved by increasing taxes makes two baseline assumptions worth challenging. First, it assumes that state government is as efficient at administering its programs and services as it could be. That is one bold assumption. Alabama has no statewide fleet management policy, antiquated payroll and time- keeping practices, and inadequate state-owned land and space management. And those are just a few issues on the internal administrative side of the equation before ever discussing efficiencies in delivering the actual services to the public.

The second assumption is that the majority of Alabamians actually want or need all of the programs and services the state currently provides. One common sentiment from those awestruck that Alabamians would want to reduce their own government is that most Alabamians are incapable of actually understanding what the “limited government” they are asking for actually requires.

But what if the people do understand? What if the people of Alabama actually intend to reduce the size and budgets of their government? Many Alabamians know that some services and programs currently provided by the government may need to be eliminated, but the tradeoff would be retaining lower taxes and prioritized government spending and services.

Maybe the pressure in Montgomery is coming directly from those with a direct financial interest in maintaining the current size and form of government. Most state employees, lobbyists, unions, and even the various agencies themselves stand to feel significant pain if government is reduced. While there are some easy cutbacks, such as eliminating unnecessary entities like the Interior Design Board, leaner government will eventually mean tougher choices.

Reducing the size of government will not, itself, lower the number of the poor and needy currently served by the state. Alabamians must be willing to open their hands and hearts to the poor and downtrodden in their midst in a reliable fashion if they want to cut programs serving those communities.

If Alabamians plan on reducing the size and budget of their government, revenue reductions provide the pressure necessary to force their legislators to prioritize. On the other hand, if they want higher taxes to pay for state programs and services, they had a funny way of showing it at the ballot box in 2010.

Cameron Smith is General Counsel and Policy Director for the Alabama Policy Institute, a non-partisan, non-profit research and education organization dedicated to the preservation of free markets, limited government and strong families, which are indispensable to a prosperous society.

Why Ending Bush Tax Cuts Of Americans Making Over $250,000 Is Not A Good Idea

If the Democrat economic plan were not primarily beneficial to government coffers, I would be for it.
I serious doubt the economy will benefit greatly by merely maintaining the Bush tax cuts for the middle. Those with incomes over $250,000 may benefit more, but they also have more disposable income to spend. Spending helps maintain GDP. More importantly, it maintains tax revenues. Therefore, I have to agree with the Republicans. Raising taxes on anyone during a prolonged economic recession is not a good idea. Because the high-income group has more disposable income to spend, they are key to keeping a modicum of economic stability.

Democrats are doing a very poor job of making themselves look good. They are showing Americans that their agendas are more important than the common good.

Someone is bound to respond: Well, duh!

However, when looking at taxation and economic growth in the long-term, I think Americans with taxable incomes over $250,000 should pay considerable higher taxes.

How could that be good?

First, it’s contiguous with founding idea of economic liberty. Thomas Jefferson is representative of a large numbers early Americans who believed the rich should pay for government services to the poor. They believed it was immoral for rich Americans to have much while poor Americans lacked. Thomas Jefferson was no welfare socialists either. Like many others, he opposed low paying wage labor because it was a form of slavery.

Second, the rich paying for welfare to the poor should inspire them to change the political economy engendering poverty and welfare. Jefferson seemed to think making the rich pay to help the poor would motivate the wealthy to devise programs to ensure the poor actually gained skills by which to earn high incomes in order to live independent of rich charity or tax funded government services. I suspect Jefferson would have favored living wage standards as opposed to minimum wages.

Lastly, it seems unjust for the working poor and the middle class to pay for problems created by the wealthy and societal institutions. The Courts didn’t have to encourage the working poor to adopt socialism in order establish economic rights against big manufacturing firms. The Courts could have forced Congress to deal with the issue of low wage slavery. Against the ready argument that freedom of contract and market value would be violated, the Courts and other authorities could have applied Adam Smith’s capitalistic view that large manufacturing corporations were quasi-government institutions requiring regulation, i.e., regulation to prevent low wage slavery. It was the founding generation, those like Jefferson, who thought it unjust to tax all Americans (including the working poor and middle class) to cover the problems of the poor.

Remember, Jefferson wrote “all men were created equal,” which appears not to mean equal opportunity to pay taxes for welfare.

Besides all of that, the stock markets have not declined to 1990 levels, which indicate a somewhat healthy economy still exists–that is if a political economy can be regarded as such. It is healthy because those making over $250,000, like the Democrat and Republican politicians on Capitol Hill, are working to keep their stock portfolios profitable.

Why Deficit Reduction Is Necessary and Need Not Hurt the Poor

By Isabel V. Sawhill, Brookings Senior Fellow, Economic Studies

We need to reduce our long-term deficits. We cannot forever spend more than we collect in taxes. And if we continue on our current path we risk another economic crisis that is likely to produce even more unemployment than we have now.

To be sure, we should not cut the deficit right now—that would be very bad for the economy. We should combine stimulus now with legislative initiatives that gradually rein in spending and raise taxes once the economy has recovered.

But if we continue to ignore the huge accumulation of debt in our future, or assume it can be addressed without cutting domestic spending, it is the least advantaged who are likely to suffer the most.
Why do I say this?

First, if we have another economic crisis that produces high rates of unemployment for an extended period, social programs will do no more than temporarily reduce the harm inflicted on the least advantaged. The safety net is no substitute for a job and a growing economy. Deficits matter because, in the longer term, they undermine the economy’s ability to produce the jobs that are especially critical to moving people out of poverty and into the middle class.

Second, many progressives believe that we can solve our fiscal problems by cutting defense and raising taxes. Although I believe they are right to fight for both of these solutions, I do not think they will be sufficient. As I have argued in more detail elsewhere (see my debate with Greg Anrig in the September issue of Democracy: A Journal of Ideas), the numbers simply don’t add up unless taxes are raised across the board to unprecedented levels—and not just for the wealthy. This level of taxation is not only politically unfeasible but unfair to the many middle and working class families who are currently struggling and whose incomes were stagnating even before the recent downturn.

Third, any effort to protect Social Security and Medicare from future spending reductions – as many advocates are now arguing – will simply put more pressure on programs that serve the disadvantaged and their children. The rapid growth of spending on entitlements has already forced the Obama Administration to propose a freeze in non-security domestic spending.

In California, Governor Schwarzenegger has proposed an elimination of the state’s welfare-to-work program as well as most child care assistance for low-income families, a harbinger of what may happen at the national level as the budget squeeze plays out over the next decade or two. This should give pause to those who argue that we can’t touch health or retirement benefits for those over about age 55, since they won’t have time to adjust to the changes. There’s no such “adjustment time” permitted for single moms with a low-wage job who are suddenly forced to spend one third of their income on child care.

Those who care about protecting the less advantaged need to be willing to find savings in the largest and fastest growing portion of the federal budget—the big three entitlement programs: Social Security, Medicare, and Medicaid. In 2010, 71 percent of all revenues are devoted to just these three programs.
What kinds of changes should advocates for the poor support?

First, they should support reforms that leave the core commitments behind Social Security and Medicare intact and ensure that no one is left bereft of access to basic health care and a decent income in old age.

Second, they should support reforms that gradually trim benefits for the more affluent over time while protecting those at the bottom.

Third, they should support reforms that recognize that not all spending on health care improves health. Specifically, we need to move toward reimbursement rates for providers that are tied to evidence of effectiveness. The goal should be to improve health, not just access to health care. Thanks to the recent health care bill, health care itself is now nearly universal. But some estimates suggest that as much as a third of all health care spending does not improve health—an estimate that is further reinforced by the good health outcomes achieved in other advanced countries that spend far less than the U.S. on health care.

But the answer for those who care about low-income Americans is not to ignore deficit reduction. It’s to pursue sensible deficit reduction in a way that protects poor people now and ensures a more prosperous future for everyone.

This article was originally published by Brookings on October 18, 2010 at www.brookings.edu/opinions/2010/1018_deficit_reduction_sawhill.aspx

Sermon on the Mount : Any Relevance Today?

There are two versions of Jesus’ Sermon on the Mount. One is in the gospel of Matthew and the other is I Like’s gospel. Jesus’ sermon encompasses chapters 5-7 in Matthew and Luke 6:20-49. Jesus’ sermon begins with a series of nine wisdom sayings or blessings in Matthew and only four in Luke’s gospel. In this post, I will address the first blessing: “Blessed are the poor in spirit, for theirs is the kingdom of heaven” or “Blessed are you who are poor, for yours is the kingdom of God.”

It is possible that Jesus’ preached this sermon from the top of Mount Gerizim. What better place to proclaim the blessings of practicing the principles of the Torah than from the place where Moses did the same. In the Deuteronomy 28, Moses pronounced four blessings for practicing daily the law of God. Ironically, Mt. Gerizim is in Samaria, which in Jesus’ day it was regarded by Temple authorities as a land of unclean gentile people. However, that didn’t stop Jews from coming to hear Jesus. They came from Judea, Jerusalem, Galilee, and other surrounding regions, and most likely gentiles came as well even from Syria, Sidon and Tyre. What is relevant about this bit of history is the benefits of practicing God law.

Of particular social significance is the first blessing Jesus proclaimed to the masses of people. The two versions give us a composite picture of the blessing of God that people of all races, cultures, religions, and nations may grasp. Matthew captures the inner working of divine law while Luke shows the heart of God for struggling people.

In Matthew, Jesus says, “Blessed are the poor in spirit.” To be poor is to lack wealth. To be poor in spirit means to lack fullness of spirit. Jesus said God is Spirit. However, Jesus did not mean to be poor in spirit is to lack God. Jesus was saying you who are needy of God are blessed. Those who depend on God for their moral and material welfare are those who are blessed. According to Jesus’ apostle Paul, God supplies all our needs according to His riches in Christ Jesus in the divine welfare program. It is also God who empowers the faithful to keep His law.

Luke’s version was influenced by his own experience of God redemptive grace. Luke was a Roman physician who became a follower of Jesus. He was poor in spirit and in the knowledge of God. In ancient society, poor people were often sick and without adequate care. Although he was not poor himself, he would have provided care for needy people. Therefore, Luke emphasizes God’s blessing for the poor. The poor are those lacking wealth either because of an unjust political economy that was beneficial only to elites and their immediate associates or because of terrible circumstances such as bad health. Throughout both the Torah and the writings of the prophets, God revealed his great concern for their welfare. This concern is demonstrated in Genesis 39-49, in the account of the Jews exodus from Egypt slavery (Ex. 1-17), in the law concerning the poor (Lev. 25; Deut. 15; 24:12-22), in Isaiah’s prophecies (58:6-12). This is also fleshed out in early Church as reported throughout the gospels and letter of the apostle of Christ.

Because of God’s great abiding concern, the needy have access to the greatest of all resources: God. The Creator of nature’s wealth has a welfare program specifically for them. By entering the kingdom of God with Jesus Christ, they can expect their material and spiritual needs will be met. By living under the divine covenant rule, the poor gain the right to God’s provision. The obligation of citizen in God’s kingdom is to live according to God’s law and grace with Lord Jesus.

The King of the Universe invites the poor and needy to enter His kingdom. His welfare program is eternally better than any that wealthy social elites or special interest groups can ever offer. God is genuinely concerned about the welfare of the poor and needy. All the they have to do is say Yes, Lord Jesus, I want in God’s righteous kingdom.

By Daniel Downs

Ohio Led-Democrats Trample Down Law to Get More Votes

According to a report by the Washington Post, the U.S. Sixth Circuit Court of Appeals in Cincinnati ruled late Tuesday to deny the Ohio Republican Party’s emergency motion for an injunction limiting same-day early voter registration and voting. Under the direction of Secretary of State Jennifer Brunner, a Democrat, county boards of election are allowing voters to register and vote on the same day, during a one-week window from Sept. 30 through Oct. 6.

Republicans argue that because state law requires voters to be registered for 30 days before casting a ballot, the procedure should be banned. Brunner said the process should continue because the votes will not be counted until Election Day. The Supreme Court of Ohio and a federal district court in Cleveland on Monday agreed with Brunner.

Politicians making it easier to register and vote is good policy. Shredding current law with the blessing of the Courts is another, which what SS Brunner and her blacked robed supporters sitting on high did.

Is it really to reduce long lines or to enfranchise more voters? Not really. Violating current law can never be justified by great political schemes. Scheming democrats know leftist activists are in the hoods convincing people to register and vote. The hint is that if they do their brotha’ will help them become more middle class through better community welfare programs. This is standard policy of get-out of poverty by voting for their Democrat (read it quick and cough a few times) benefactors.

This practice has been going for a long time and the poor are still poor. They still have the same issues with blighted neighborhoods, poor city services, low-income, crime on every street corner, little good health care, poor diets, and on and on. Unless they are true believing dependents on sugar daddy uncle Sam, they still have the same problems they have had for decades.

Some of advocates like ACORN, and others are seeking to help the poor. Sometimes they do. They helped them get loans and mortgages that they cannot not pay. They often have had to pay 3-4 times more to get payday loans for quick cash. Some inner-city poor actually work hard but still have little hope to achieve the American Dream. Many are single parenting moms, who should vote.

The problems is–and I have worked for ACORN while living in another state–multimillion dollar activist organizations like ACORN do not help people move beyond poverty they maintain. It’s true they make being poor a little better. With the cooperation of Washington politicians and rich elites, many poor are enabled to enjoy much of the good life, meaning having a decent place to live, cars, cell phones, computers, nice clothes, good food, and other stuff. It must be wonderful to have all that stuff only for the price of human dignity, much dependency, and little freedom.

Leading Ohio Dems desire to continue their paternal role over their poor benefactors. They also want the blessing of the superiors in party and on Capitol Hill. I’m sure Obama and company will shower may blessing on them and their grateful children.

I think the poor would show less prejudice by voting for McCain and Palin. They would be better off if while doing so they speak with one voice their demand for serious investment in their community, more justice economic policies to assist all willing to work to move out of poverty in order pay their own way. And just think, real prosperity and productivity would increase the local tax revenues and circulation of earned money, more consumerism, more employer-employee purchased health care insurance, paid more genuinely qualified loans, and the economic and political elites would still see the wealth trickle up into their coffers.

Wouldn’t that make a better world in which to live?