Archives for December 2010

December 7th, Fairfax, VA—Americans for Limited Government (ALG) President Bill Wilson today praised the discontinuance of a federally-subsidized bond program for states and local governments, which he said “has been used to bail out bankrupt states like New York and California.”

According to Bloomberg News, the extension of the Build America Bonds program was omitted from a deal struck between the White House and congressional leaders on preventing imminent tax hikes on all Americans. The program is set to expire at year’s end.

“The so-called ‘Build America’ bonds are really state bailout bonds, a federal subsidy of interest payments for state and local governments, should be discontinued, because they create a disincentive for troubled states to make the hard decisions to cut spending,” Wilson said.

According to the Bloomberg report, under the program, “More than $173.6 billion of the taxable securities have been sold since April 2009, making it the fastest-growing segment of the $2.8 trillion municipal market, according to data compiled by Bloomberg. The U.S. pays 35 percent of the interest on the debt.”

“These bonds are really a mechanism to nationalize the unsustainable spending of insolvent states and local governments, which are hampered with uncontrolled public pension and health care costs,” Wilson said.

Wilson said blocking the continuance of the program was “a step in the right direction,” but that “the danger now exists that some other entity, like the Federal Reserve, will intervene to bail out state pension funds and budgets.” He urged members to cosponsor and approve HR 6484, a bill that would ban any federal agency, including the Federal Reserve, from bailing out state and local pension systems.

The bill was introduced by Representative Devin Nunes. In a recent letter to Nunes, Wilson wrote, “Your legislation’s unequivocal declaration that the federal government won’t bailout these state and local big spenders ends the state public employee pension bailout debate before it starts, and you are to be commended for this pro-active action.”

The bill also would create a transparent database at the U.S. Treasury of state and local municipal pension systems so that the total unfunded liabilities would be known to taxpayers. In an exclusive interview with ALG, Nunes said that it was necessary for taxpayers “to find out what they owe to the people that work for them, the public employees.”

Right now, state pensions could be facing a $1 trillion shortfall of unfunded liabilities, according to Pew Research. But some analysts, including Northwestern University Professor Joshua Rauh and Pacific Research Institute’s Steven Greenhunt, foresee as much as a $3 trillion shortfall. Wilson said that without an explicit prohibition, “the Fed could arbitrarily act to prop up certain states, including their $3 trillion of unfunded pension obligations.”

“It’s time for states to stand on their own two feet. It’s bad enough the Fed is papering over the national debt by buying treasuries. The last thing we need is for the central bank to step in and start bailing out states by buying municipal bonds or propping up the state pension systems. Congress needs to adopt Representative Nunes’ bill to prevent that from happening,” Wilson concluded.

Attachments:

Letter to Representative Devin Nunes, December 1st, 2010.

Video Interview with Representative Devin Nunes, December 2nd, 2010.

Interview Availability: Please contact Rebekah Rast at (703) 383-0880 or at rrast@getliberty.org to arrange an interview with ALG President Bill Wilson.

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December 7th, 2010, Fairfax, VA—Americans for Limited Government (ALG) President Bill Wilson today issued the following statement on the reported deal struck between the White House and congressional leaders on the lame duck session of Congress’ consideration of preventing imminent tax increases on all Americans:

“Two-year extensions of the income tax, capital gains tax, and dividend tax rates, and a reduction of the estate tax to 35 percent may not be ideal, but they are better than the alternative, which are tax increases on all Americans. After all, the unemployment rate has been at or above 9.4 percent for 19 consecutive months, the worst economic climate since the Great Depression. We need to create jobs, not increase the tax burden for American businesses at a time when the U.S. is already globally uncompetitive.

“A deal to block the imminent tax increases is a step in the right direction, but more must be done. When Congress returns next year, it should get to work on permanently restructuring and flattening the tax code to remove tax subsidies, corporate welfare, exemptions, and lower overall rates. The corporate tax should be eliminated all together to help the U.S. become more competitive in the global economy. This would encourage more businesses to set up shop here in America and create jobs.

“However, the perpetual extension of unemployment benefits past two years should be rejected. It’s not paid for and will only add to the national debt. It’s no longer a temporary program; it’s become a welfare program. If these benefits cannot be paid for with offsetting cuts elsewhere in the budget, they should be rejected. We’re going broke, and the budget will not be balanced ever without spending cuts.”

Interview Availability: Please contact Rebekah Rast at (703) 383-0880 or at rrast@getliberty.org to arrange an interview with ALG President Bill Wilson.

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December 6th, 2010, Fairfax, VA—Americans for Limited Government (ALG) President Bill Wilson issued the following statement on the rejected recommendations of the Obama National Commission on Fiscal Responsibility and Reform:

“The only credible way to seriously address the debt crisis is through spending cuts, not tax increases. A recent International Monetary Fund study makes this point, writing, ‘the tax burden is already high in several advanced economies, which means that a large part of the adjustment will have to take place on the spending side’ in order to achieve debt sustainability. And as noted by the American Enterprise Institute’s Kevin Hassett, based on that study, the most successful fiscal consolidations consisted of at least two-thirds spending cuts.

“In contrast, the Obama deficit commission did not contemplate a balanced budget until 2035, nor did it contemplate ever reducing overall spending. That means, under the proposal, spending would still have increased year-on-end. Therefore, it never contemplated reducing the overall $13.8 trillion debt, which would have continued to grow under the proposal. That is unacceptable to the American people, who want to pay down and retire the national debt, not continue to grow it. We don’t have 25 years to balance the budget. We have to do it now.

“Fortunately, the half-measures of the Obama deficit commission were rejected by that very commission. Unfortunately, the insolvency crisis the United States faces still looms above all other issues. If Congress does not act to balance the budget and begin reducing the debt immediately, next year the Federal Reserve will become the number one holder of U.S. debt, and thedebt will soar past 100 percent of the Gross Domestic Product in just a few short years. By 2018, if not sooner, our Triple-A credit rating will likely be downgraded.

“We cannot grow ourselves out of this mess alone, although robust economic growth must be restored through permanent tax relief. We cannot tax our way out, although revenues would begin to recover with robust economic growth. But even those are not enough. The only way to stop this death spiral any time in the near future is to cut spending immediately. Any balanced budget plan that does not contemplate severe spending cuts is delusional and will not work.”

Interview Availability: Please contact Rebekah Rast at (703) 383-0880 or at rrast@getliberty.org to arrange an interview with ALG President Bill Wilson.

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December 3rd, 2010, Fairfax, VA—Documents obtained by Americans for Limited Government (ALG) Research Foundation through a Department of Labor whistleblower show a coordinated strategy by the Solicitor of Labor, Patricia Smith, to force reluctant employers to unionize.

ALG Research Director Don Todd, whose office obtained the documents, explained, “To help the unions, the Department of Labor is going to put public-relations people in every regional office to beat the drums on EEOC, OSHA, and wage-an-hour violations of employers that refuse to organize. And they will find violations.”

In a recent interview with the Wall Street Journal’s John Fund, Smith said “she didn’t know what” a plan to “deter [employers] through shaming” meant.

An ALG backgrounder Todd said the “broader plan outlines exactly what it means. Employers that refuse to unionize are going to be targeted for litigation.”

Fund commented in his column, “whatever [‘shaming’] might involve, it doesn’t sound appropriate for an agency charged with carrying out the law in an even-handed fashion.”

The Solicitor’s strategy includes plans to:

• “Identify a public affairs liaison in each Regional Office” to “send stronger, clearer messages to the regulated community about DOL’s emphasis on litigation.”
• “Focus on cases against employers in priority industries.”
• “Litigate cases that cut across regions.”
• “Engage in enterprise-wide enforcement,” e.g., send every DOL enforcement agency against a particular employer.
• “Identify and pursue test cases.” This will be done to “challenge legal principles that impede worker protections; successful challenges will advance workers’ rights, as will successful enunciation of new interpretations.”
• “Engage in greater use of injunctive relief.” The Department believes that fines are not enough.
• “Focus SOL’s amicus program: We will focus our amicus program on those cases where DOL’s participation will provide the court with a unique voice on worker protection that the parties are not likely to articulate.”

The document also details tactics for implementing the strategy as they affect the various enforcement agencies within the Department:

• “identify theories and practices that can be pursued for lowering the rate of cases in which LJFs and the Commission reduce MSHA [Mine Safety Health Administration] penalties.”
• “Pursue at least one § 108(a)(2) injunctive action in federal district court.” (Refers to injunctions against coal mines where the Secretary “believes” that the operator has a pattern of violation of safety standards.)
• “Imposing shorter deadlines for implementing remedial measures in conciliation agreements and consent decrees.”
• “Deter [employers] through shaming.”

In a recent video interview, ALG’s Todd said that the document proves that the Department of Labor has “become a tool for the labor unions to beat businesses over the head.”

Americans for Limited Government President Bill Wilson said in a statement, “These documents prove the Department of Labor has become nothing more than a weapon of labor unions to force employers to unionize.”

Attachments:

“How Obama’s Department of Labor Plans to ‘Enforce’ Labor Law,” Americans for Limited Government Research Foundation, December 2010.

ALG Research Director Don Todd Video Interview, December 2010.

Interview Availability: Please contact Rebekah Rast at (703) 383-0880 or at rrast@getliberty.org to arrange an interview with ALG President Bill Wilson or ALG Research Director Don Todd.

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December 1st, 2010, Fairfax, VA—Americans for Limited Government (ALG) President Bill Wilson today issued the following statement on the lame duck session of Congress’ consideration of a continuing resolution for FY 2011:

“Two months have passed since Congress was required to have completed the 2011 budget process on October 1st. It had over a year to complete the process, but they have not even begun yet. Instead, the government is operating on a continuing resolution that expires on December 3rd.

“Congress should either pass a two-month continuing resolution and let the next Congress deal with the 2011 budget, or pass a year-long continuing resolution with baseline 2007 levels across the board at $2.7 trillion. That would reduce the deficit by over $800 billion. Then, if Congress wished to increase entitlement spending to current levels, it would have to be paid for by eliminating hundreds of billions of dollars of needless federal programs, including the financial bailouts and the wasted ‘stimulus’.

“Congress should be forced to choose: Keep the entitlements, or keep the bureaucrats. But it can’t have both. The fact is, nobody wants to reduce Medicare and Social Security benefits to the elderly who paid into the system, so the bureaucracy should be leveled, and responsibility for regulation returned to the states. Corporate welfare and other subsidies should be ended once and for all. The federal government should only keep those departments and agencies that are absolutely essential to protect the homeland, meet our obligations overseas, and keep our commitments to the nation’s elderly and those who cannot help themselves. Everything else should be eliminated.”

Interview Availability: Please contact Rebekah Rast at (703) 383-0880 or at rrast@getliberty.org to arrange an interview with ALG President Bill Wilson.

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December 1st, 2010, Fairfax, VA—Americans for Limited Government (ALG) President Bill Wilson today issued the following statement on the lame duck session of Congress’ consideration of a continuing resolution for FY 2011:

“Two months have passed since Congress was required to have completed the 2011 budget process on October 1st. It had over a year to complete the process, but they have not even begun yet. Instead, the government is operating on a continuing resolution that expires on December 3rd.

“Congress should either pass a two-month continuing resolution and let the next Congress deal with the 2011 budget, or pass a year-long continuing resolution with baseline 2007 levels across the board at $2.7 trillion. That would reduce the deficit by over $800 billion. Then, if Congress wished to increase entitlement spending to current levels, it would have to be paid for by eliminating hundreds of billions of dollars of needless federal programs, including the financial bailouts and the wasted ‘stimulus’.

“Congress should be forced to choose: Keep the entitlements, or keep the bureaucrats. But it can’t have both. The fact is, nobody wants to reduce Medicare and Social Security benefits to the elderly who paid into the system, so the bureaucracy should be leveled, and responsibility for regulation returned to the states. Corporate welfare and other subsidies should be ended once and for all. The federal government should only keep those departments and agencies that are absolutely essential to protect the homeland, meet our obligations overseas, and keep our commitments to the nation’s elderly and those who cannot help themselves. Everything else should be eliminated.”

Interview Availability: Please contact Rebekah Rast at (703) 383-0880 or at rrast@getliberty.org to arrange an interview with ALG President Bill Wilson.

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