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Economy

If California adopts single-payer, I’ll finally leave the state

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It’s mildly ironic that on the 10th anniversary of me taking up residence in the state of California, I’m seriously considering moving my family out. It’s not the outrageous cost of living nor the left-leaning nature of the state even in the “conservative safe haven” of Orange County. Sacramento is now pushing for single-payer health care. If that makes it in, I’ll finally move out.

As is often the case with liberal ideas, the fantasy surrounding the proposal is so outrageous that many in the state will stick their heads in the sand (even further than they already do) and love on the idea while ignoring the consequences. They’re calling for free… everything: no copays or deductibles. This is why it has a chance of succeeding. People will hear that and instantly rejoice.

Of course, “free” is never free. You might be wondering how much this proposal will cost California tax-payers. The current budget is $183 billion. That’s a lot of money and it’s made possible by outrageously high taxes on residents and businesses. To make this single-payer plan work will require $400 billion per year. Yes, this plan will more than triple the current budget.

Let that sink in. I’ll wait.

I’m not rich but my revenue is above average. Even so, I’d by crushed by further increases in state taxes. No thank you.

As Aaron Bandler noted on DailyWire:

California already faces a $1.6 billion budget deficit this year, but the state’s debt problems are actually much worse than that, as the state faces unfunded liabilities of almost a trillion dollars. Given that the Tax Foundation has already ranked California as having the sixth-highest tax rates in the nation, the ensuing tax rates from implementing a single-payer healthcare bill system would be even more onerous and cripple the state’s economy.

The problem with creating utopia is that reality eventually kicks in and the attempted utopia turns into a living nightmare, which is why states that have tried to implement single-payer have failed to do so. The price tag of the bill being put forward in the state senate suggests the same will be true for California.

The left is great at selling a dream. They’re like the junior high student council candidate who tells people how awesome it will be when they have Pepsi coming out of the water fountains. They’re in the business of making promises and blaming others for the consequences. No state exemplifies this better than California. I fear I may have to abandon the nice weather to find greener pastures soon.

Christian, husband, father. EIC, NOQ Report. Co-Founder, the Federalist Party. Just a normal guy who will no longer sit around while the country heads in the wrong direction.

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Economy

High corporate taxes mean higher prices for consumers

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High corporate taxes mean higher prices for consumers

There’s a huge disconnect between one of the biggest parts of the liberal narrative against the GOP tax cuts and reality. I don’t blame them for pushing it. I blame people for buying into it. All it takes is a little critical thinking to realize the narrative is completely false.

Let me start by saying I’m not a fan of the tax plan. We need tax reform, not cuts on an abysmal progressive system. These cuts are temporary and until we truly reform the system altogether, we’re always going to be stuck in the political ups and downs on taxes. The system is used as a tool to help members of the two big parties to win elections. This makes it practically arbitrary, but now’s not the time to discuss the problems with the plan. Let’s discuss what’s NOT a problem with the plan.

The left is painting the massive corporate tax cuts as a way to enrich the rich. That’s ludicrous for multiple reasons, but rather than go into a boring diatribe about economics, let’s just use common sense. If a company pays more in taxes, do they really pay more? They may be delivering more money to the government on a quarterly basis, but in most cases when a company is involved in buying or selling products or services, they’re not really paying more. Their customers are.

Business math works backwards. They don’t set a price (in most circumstances) and then fit the costs to match the price. Businesses determine costs, including taxes, and then set their prices based upon what’s happening in the market, demand, and potential profits. If a business pays more in taxes, they rarely take that out of profits. They simply raise the prices to match. Who ends up paying the higher taxes as a result? Yep, us.

Obviously it’s more complicated than that, particularly when we look at businesses that don’t have fluctuating prices or consumer needs. There’s also the loss of loopholes that should be considered. I haven’t done the math myself or seen case studies, but we can assume a small percentage of corporations will actually be paying more under the GOP plan. That’s going to happen any time you make changes. Some will win and some will lose. The key is to make more winners than losers while making sure the losers don’t get hurt too badly.

The corporate tax cuts are arguably the most defensible aspect of the GOP’s plan because it’s the component most likely to actually improve the economy. For the left to be using that as their big complaint about the plan is only effective on those who don’t think it through. Unfortunately, that’s actually quite a large block of the voting population. That’s why the left is sticking with it.

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Economy

Corker, Rubio flip to Yes votes on tax bill

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Corker Rubio flip to Yes votes on tax bill

Senator Bob Corker, the original lone dissenter to the first variation of the Senate tax bill, and Senator Marco Rubio, the latest dissenter to the upcoming tax bill, have both signaled they will now vote in favor of the bill. It is expected to come up for a vote next week.

There are still three potential holdouts: Arizona’s Jeff Flake, Utah’s Mike Lee and Maine’s Susan Collins. All have indicated they want to read the bill first before deciding. It is expected to be released to the public today.

Rubio, Corker back tax bill as Trump predicts ‘monumental’ reform will pass next week

http://www.foxnews.com/politics/2017/12/15/trump-predicts-monumental-tax-bill-will-pass-next-week-amid-uncertainty-in-senate.htmlThe House and Senate have passed separate tax bills, but they have been working to come up with a final $1.5 trillion GOP tax reform legislation. Final votes are likely in both chambers next week.

As he departed the White House on Friday for a speech at the FBI academy, Trump told reporters he has seen the details of the final version and is confident Republicans will get behind it.

The President’s comments on the bill were short of a commitment to passage. He’s likely waiting to hear from the three GOP Senators on the fence. It will pass easily in the House, but the Senate can only afford two No votes from Republicans in the Senate.

My Take

We need tax cuts and I reserve the right to judge it until it’s fully released, but most indicators so far lead me to believe this will be another populist push by the GOP to get as many wins as possible while upsetting as few people as possible. It’s not the type of tax cut that we really need, but without expansive spending cuts that the GOP has thus far been unwilling to attempt, they can’t cut taxes to the desired level.

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Economy

Rubio’s play for child tax credits is for a presidential run

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Rubios play for child tax credits is for a presidential run

Senator Marco Rubio wants to be in the Oval Office. He wants it so badly he can taste it. If Hillary Clinton had won, he’d be one of the frontrunners to take her on in 2020. His supporters would say it was too early in 2016 for him, that he got “trumped,” that Ted Cruz played dirty, and that 2020 is his year. Hillary didn’t win, so the narrative has shifted. He’s now looking to build up a resume worthy of a 2024 run… or a 2020 run should President Trump choose not to run.

He isn’t alone in his desire to distinguish himself. Others have made moves to distance themselves from the GOP Establishment, whether for a future run at higher office or simply to be able to keep their seats. They’re doing what they can to challenge current GOP orthodoxy and even touch on bucking against President Trump without drawing his ire. They learned that they don’t want to be Bob Corker or Jeff Flake, but they also don’t want to be Chris Collins or Duncan Hunter.

The most populist play Rubio has ever made, his Gang of 8 amnesty push, blew up in his face and contributed to him not building the groundswell he needed in 2015 to make 2016 his year. Now, he’s taking another shot at a populist perspective with the child tax credits. Daniel Horowitz over at Conservative Review posted an excellent breakdown of why this is terrible:

Why Marco Rubio is dead wrong on taxes

https://www.conservativereview.com/articles/why-marco-rubio-is-dead-wrong-on-taxesHow do you offer a significant tax cut to those who pay no federal income taxes? That is a question that seems to be vexing Sen. Marco Rubio to the point that he is willing to hold up a bill that already doubles the child tax credit. But it is the wrong question to be asking.

The question we should be asking is how we can have less socialism, not more wealth redistribution, so that the economy can grow and everyone can enjoy upward mobility through better jobs, higher wages, and cheaper goods and services.

I don’t like the GOP tax plan and Rubio’s push is going to make it worse. The GOP will bend on this one. They need the tax cuts to go through so badly they’re willing to deal with anyone on just about anything. Nothing’s off the table. They need the President’s signature on something significant that they put on his desk before the end of the year or they feel like they’re going to lose big in 2018. They might do that either way, though the Democrats are doing everything they can to distance themselves from their base as well as from reality itself.

The best thing going for the GOP is that the Democrats are pushing further to the left.

Rubio would have the GOP push further to the left as well. The former Tea Party candidate has systematically betrayed his promises both made and implied over the last seven years. This change to child tax credits is just another reason to believe he’s against the limited-government principles he once promised to uphold.

Update

As predicted…

GOP tax bill enhances child tax credit in response to Rubio

https://www.axios.com/gop-tax-bill-enhances-child-tax-credit-in-response-to-rubio-2517687532.htmlThe final GOP tax bill will enhance the child tax credit, according to four GOP sources. Enhancing the refundability of the credit was a key demand of Sen. Marco Rubio, who threatened to vote no on the bill if it wasn’t addressed, and Sen. Mike Lee, who was undecided.

“We have not seen text but I think it is fair to say the working families will get more tax relief in the final bill,” said Conn Carroll, a Lee spokesman. The conference report will allow families with no income tax liability to receive $1,400 of the $2,000 credit, according to the WSJ and confirmed by an aide. The original Rubio-Lee ask was that the credit be fully refundable up to payroll tax liability.

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