Shenanigans In North Carolina

Governor Roy Cooper was elected in 2016 and began his term in 2017. Previously he served as North Carolina’s Attorney General. My sources tell me that he runs the Democrat party much the way a mafia don would, using threats to make sure no legislators break ranks in their voting. He also seems to have some problems controlling spending in some of the state agencies.

The Carolina Journal posted an article today citing some of Governor Cooper’s current challenges.

The article reports:

Consider, for example, the current cash crunch at North Carolina’s Department of Transportation. Secretary Jim Trogdon blames the problem on hundreds of millions of dollars of hurricane damage and payouts to property owners whose rights were violated by the state’s abusive Map Act.

While these costs are real, they don’t fully explain DOT’s overspending. An outside consultant’s report dinged the department for faulty forecasting and cash management. State Treasurer Dale Folwell cited the report’s findings as well as DOT’s transfer of $1.1 billion from the Highway Trust Fund to the Highway Fund without his legally required authorization as reasons why Cooper should replace Trogdon.

Rather than responding to these specific concerns, the governor’s press office put out a statement rejecting what it termed “a financial lecture from the nation’s least effective state Treasurer.” DOT’s money woes have complex origins and consequences, to be sure. But Trogdon’s defense neither required nor was advanced by such adolescent name-calling.

Much less money is at stake over at the Department of Military and Veterans Affairs, but its recent miscue inflicted more political damage.

The department handles a decades-old program called the N.C. State Scholarship for Children of War Veterans. The department sent out a letter informing colleges and universities that scholarship payments would be “delayed until further notice,” citing the budget impasse between Gov. Cooper and the General Assembly. But according to reporting by WBTV’s Nick Ochsner, there was neither a fiscal nor a legal reason to suspend payment. Whether this was simply an administrative screw-up or a purposeful attempt to pressure GOP lawmakers, it was incredibly foolish.

There are also some questions regarding Medicaid in the state:

Meanwhile, the Department of Health and Human Services is mired in its own controversy over awarding a Medicaid contract to a managed-care network led by Blue Cross Blue Shield of North Carolina instead of one led by Aetna. In its legal challenge to the decision, Aetna argues that one of the DHHS employees in charge of evaluating the bids was living with a key Blue Cross executive.

Furthermore, according to reporting by Carolina Journal’s Don Carrington, an internal document shows that Aetna’s bid originally ranked above the Blue Cross bid. A DHHS official then intervened to create a new criterion after the fact, which had the effect of displacing Aetna in favor of Blue Cross.

There are also charges that the Governor attempted to obstruct an investigation into some aspects of the Atlantic Coast Pipeline.

The article concludes:

Cooper and three of his aides have been asked to testify on the pipeline at a legislative hearing on November 8. Will the sober-minded former state senator and attorney general show up and provide a persuasive defense of his administration’s conduct? Or will North Carolinians be treated to another round of political hackery and juvenile tweets?

Lt. Governor Dan Forest will be running against Governor Cooper in 2020. Dan Forest definitely has my vote.

 

North Carolina Has A Budget

The North Carolina House has overridden Governor Cooper’s veto of the state budget. As expected, the Democrats are protesting. Below is the statement issued by Speaker of the House Tim Moore:

Raleigh, N.C. – The Office of House Speaker Tim Moore released a factual recap on Thursday of how the budget veto override unfolded this week to debunk outrageously false claims that House Republicans misled their Democratic colleagues about a no-vote session on Wednesday morning.

  • The budget veto override was taken during a House floor session with a properly noticed calendar following two public announcements votes would be taken on Wednesday.
  • There was never any of the customary public communication of a no-vote session by the Speaker’s office, which makes all such announcements to members of the House when a no-vote session is planned. 
  • House Republicans never planned to attempt a veto override on Wednesday, nor were they aware House Democrats were falsely told by their own leadership of a no-vote session.
  • House Republicans had only 55 members in session on Wednesday morning – not even enough to hold a majority on the floor with all members present. 
  • By their numbers alone, it is obvious House Republicans never planned to override the veto Wednesday.   
  • Contrary to false claims that House Democrats in North Carolina were attending 9/11 commemoration ceremonies on Wednesday morning, four extremely credible, separate accounts factually demonstrate this is an outright lie. 
  • The editor of the News & Observer’s ‘Insider’ Colin Campbell tweeted the following: “So much misinformation going around the #ncga today: -Only one Democratic House member has been confirmed as attending a 9/11 event during the veto override vote.”
  • Governor Roy Cooper said in a noon press conference (4:45 mark) Wednesday that he did not see and was not aware of any House Democrats at a ceremony he attended, directly contradicting a false narrative spun by national media outlets like the Washington Post.  
  • As widely reported, House Rep. Deb. Butler (D-New Hanover) said on the floor (5:20 mark) that Democrats were downstairs drawing maps during the veto override. 
  • House Minority Leader Darren Jackson confirmed in his press conference that in-fact Democrats had a redistricting committee meeting planned that morning.
  • The North Carolina House held its commemoration session for 9/11 first responders and victims in its afternoon session on Wednesday.
  • The narrative that the budget veto override vote on Wednesday had anything to do with 9/11 ceremonies is a provably false fabrication debunked by extremely credible sources – the House Democrats themselves – and any reproduction of this narrative is simply spreading a lie. 
  • Democrats meeting privately about ongoing redistricting in the General Assembly – particularly with all of their members of the House Redistricting Committee together – is a potential violation of a three-judge panel’s order that redistricting committee efforts take place in public view. 
  • The Governor falsely alleged in his press conference that Republicans “orchestrated” the veto override and Democrats “were lied to.”  This is a complete and total fabrication that he must retract immediately and cease misleading North Carolinians about the circumstances.   
  • House Republican members and staff had no idea that House Democrats were told by their leadership Wednesday was a no-vote session
  • This was a mistake by the House Democratic leadership that they took responsibility for it in their press conference Wednesday morning
  • The Speaker frequently announces no-vote legislative sessions for members’ planning purposes, often at least once or twice a week. 
  • The announcement is made by the Speaker from the floor of the House, by email from the Speaker’s office to all members, or both
  • The announcement is often shared on social media to make the broader General Assembly community aware of a no-vote legislative session. 
  • None of the customary public announcements were ever made of a no-vote session Wednesday by the Speaker’s office. 
  • To assume a no-vote session based on private oral conversations about specific bills is an erroneous presumption by House Democrats’ leadership that ignores the consistent procedures of the House for notifying members of a no-vote session. 
  • The Speaker’s office relies on public announcements of no-vote sessions from the floor of the House and by direct communication to all members to avoid exactly this type of confusion. 
  • In three terms as the presiding officer, Speaker Moore has never, and would never, announce a no-vote session then hold votes that session. 
  • Speaker Moore is serving his ninth term in the state House, as is House Rules Committee Chairman David Lewis.  They have a combined 36 years of experience serving in the North Carolina General Assembly.
  • Both leaders have far too much respect for the North Carolina House and their colleagues to announce no recorded votes, then hold a vote. 
  • In Tuesday afternoon’s no-vote legislative session at 4:30 p.m. on September 10, 2019, North Carolina House Republicans likely had the votes on the floor to override the Governor’s budget veto. 
  • Chairman Lewis was presiding at the time but did not take a vote, because Speaker Moore had announced in that morning’s session that Tuesday afternoon would be a no-vote session. 
  • House Republican leadership always honors announcements of no-vote sessions and this week was no different
  • In Tuesday afternoon’s session, Chairman Lewis announced publicly the intention to take recorded votes the following day on two appropriations bills that were directed to Wednesday’s calendar “without objection.”
  • When adding both bills to the calendar on Tuesday, Chairman Lewis explicitly announced that there would be recorded votes on Wednesday (5:20 mark of the session’s House audio archive.)
  • Shortly after Chairman Lewis announced intention to take recorded votes on the two budget bills the following day, he announced a start time of 8:30 a.m. for Wednesday. 
  • The Speaker of the House, present members of the House, and staff, were all planning to hold recorded votes on bills on the published calendar for Wednesday’s morning session
  • All were completely unaware that House Democrats were told by their leadership of a no-vote session
  • The consideration of the veto override was properly noticed and published on the House calendar, as it has been for nearly 2 months.   
  • The House clerks and staff conducted standard preparation for a voting session.
  • House Republicans clearly, by their numbers, had no plans to attempt a veto override on Wednesday:
  • Republicans did not have enough votes to maintain a majority on the floor if all members were voting and present, with just 55 members.
  • The Republican caucus had 10 of its members missing from its 65-member majority. 
  • Republicans were missing the House Majority Leader and Rules Chairman from the floor on Wednesday
  • This is an obvious demonstration Republicans never planned to attempt an override and had no awareness Democrats did not plan to attend the voting session
  • Any suggestion that Republicans planned the veto override on Wednesday – which is demonstrably false – is an outright lie.
  • The House Republican caucus was genuinely confused and surprised when the Democrats did not arrive for the 8:30 am voting session. 
  • The Speaker confirmed with the clerks and his staff that no announcement had been made of a no-vote session following the prayer and Pledge of Allegiance
  • Members and staff briefly discussed whether to hold the veto override with the votes appearing secured on the floor during a voting session   
  • The veto override was never planned, discussed, or considered, by House leaders or staff until Wednesday morning’s session when Democrats did not arrive
  • House Republicans were completely transparent about what happened.  They held a public press conference, answered questions from the media, and Speaker Moore joined Capital Tonight on Spectrum News the day of the vote after speaking with reporters throughout the day. 
  • The Speaker has said repeatedly he would hold the veto override when the votes were secured on the floor of the House in a voting session.
  • He did so, advancing a historic school construction initiative in education communities across the state, more than $100 million in disaster relief funds, and another round of tax relief for North Carolina families. 

These are the facts and the Office of the Speaker appreciates your time reviewing this memo that dispels false claims that House Democrats were misled on Wednesday, or that they were attending 9/11 ceremonies during the veto override vote, or that House Republicans planned to attempt the veto override on Wednesday.

Unfortunately, very little of this information will find its way into the mainstream media. Fortunately, the Senate is also expected to override the veto and pass the budget.

Good News On Healthcare

The Daily Signal posted an article today about President Trump’s plan to reform healthcare (which obviously starts with the removal of ObamaCare).

The article reports:

A look at his fiscal year 2020 budget shows that the president has a plan to reduce costs and increase health care choices. His plan would achieve this by redirecting federal premium subsidies and Medicaid expansion money into grants to states. States would be required to use the money to establish consumer-centered programs that make health insurance affordable regardless of income or medical condition.

The president’s proposal is buttressed by a growing body of evidence that relaxing federal regulations and freeing the states to innovate makes health care more affordable for families and small businesses.

Ed Haislmaier and I last year published an analysis of waivers that have so far enabled seven states to significantly reduce individual health insurance premiums. These states fund “invisible high risk pools” and reinsurance arrangements largely by repurposing federal money that would otherwise have been spent on Obamacare premium subsidies, directing them instead to those in greatest medical need.

By financing care for those with the biggest medical bills, these states have substantially reduced premiums for individual policies. Before Maryland obtained its waiver, insurers in the state filed requests for 2019 premium hikes averaging 30 percent. After the federal government approved the waiver, final 2019 premiums averaged 13 percent lower than in 2018—a 43 percent swing.

The article explains that the President’s plan is similar to another proposed plan:

It closely parallels the Health Care Choices Proposal, the product of ongoing work by national and state think tanks, grassroots organizations, policy analysts, and others in the conservative community. A study by the Center for Health and the Economy, commissioned by The Heritage Foundation, found that the proposal would reduce premiums for individual health insurance by up to 32 percent and cover virtually the same number of people as under Obamacare.

It also would give consumers more freedom to choose the coverage they think best for themselves and their families. Unlike current law, states could include direct primary care; health-sharing ministries; short-term, limited-duration plans; and other arrangements among the options available through their programs.

Those expanded choices would extend to low-income people. The proposal would require states to let those receiving assistance through the block grants, Medicaid, and other public assistance programs apply the value of their subsidy to the plan of their choice, instead of being herded into government-contracted health maintenance organizations.

We can do better at healthcare. Either one of these proposals would be a great start.

It Really Is The Spending

The following graph was posted at The Washington Examiner yesterday:

The article notes:

As shown in the chart below, in the 50 years prior to the effective date of the Trump tax cuts (1968-2017), tax revenue averaged 17.4 percent of gross domestic product, while spending averaged 20.3 percent. With the Trump tax cuts in place, revenue is below the historical average for the next few years, but by the middle of the decade, it returns to that average and then surpasses it as some provisions of the tax cut begin to expire. By 2029, the end of the CBO projection period, revenue reaches 18.3 percent — or nearly one point of GDP above its historical average.

We need some serious budget-cutting in Washington. It is time for baseline budgeting to stop. Department budgets need to start from scratch and justify every penny.

Something To Consider

Decisions that impact national security should be made on the basis of what is best for America. Unfortunately that has not been the case as of late.

On January 10th, The Washington Times reported:

President Trump has proposed spending $18 billion over the next decade to construct a new and improved border wall between the U.S. and Mexico. While some lawmakers have criticized the both the cost and the plan, a new analysis reveals the expenditure is relatively small compared to other federal spending.

“That $18 billion would equal just 0.0338 percent of the $53.128 trillion the Congressional Budget Office currently estimates the federal government will spend over that same 10-year period,” wrote Terence P. Jeffrey, editor-in-chief of CNSNews.com.

It also equals only 2.7 percent of the money the federal government will spend on the food stamp program, Mr. Jeffrey wrote. The Supplemental Nutrition Assistance Program will eat up $679 billion in the 10 fiscal years from 2018 through 2027, according to budget office’s estimate.

He figured that this is 37.7 times as much as the $18 billion which would go to Mr.Trump’s proposed border wall.

The cost of the wall is also 0.34 percent of the $5.232 trillion which the federal government will spend on Medicaid over the next 10 years, and 0.26 percent of the $6.838 trillion allotted to national defense in the next decade.

So this battle is obviously not about money. We also have to realize that if either the Democrats or the Republicans were serious about border security, the wall would have been built by now. So why don’t we have a wall?

Carroll Quigley one wrote:

“The argument that the two parties should represent opposed ideals and policies, one, perhaps, of the Right and the other of the Left, is a foolish idea acceptable only to doctrinaire and academic thinkers. Instead, the two parties should be almost identical, so that the American people can throw the rascals out at any election without leading to any profound or extensive shifts in policy. Then it should be possible to replace it, every four years if necessary, by the other party, which will be none of these things but will still pursue, with new vigor, approximately the same basic policies.” ~ Carroll Quigley

The Democrats and the establishment Republicans have a shared policy on open borders–they support them. The Democrats want voters and the Republicans want cheap labor. Until someone wants the safety of the American public, we have a problem.

Six Major Challenges In 2019

On December 28th, Investor’s Business Daily posted an editorial listing what their editors considered would be the top six issues of 2019. The title of the editorial is, “Will 2019 Be Happy? It Depends On How Washington Handles These 6 Challenges.” I suspect that is true.

The editorial lists the six items:

1. The Federal Reserve

2. Trade

3. Immigration

4. The Coming Budget Battle

5. Slaying The Regulatory Dragon

6. Fixing Health Care ‘Reform’

Here are some of the observations from the editorial on each item:

The Fed has raised its benchmark funds rate eight times over two years in pursuit of a “neutral” rate. Its most recent rate hike, coming about a week before Christmas, was followed by a steep decline in stocks and growing concerns that the economy might fall into recession next year if the central bank follows through on its plan to raise rates at least twice more.

It’s of more than academic interest that all 11 of the U.S. recessions since World War II were preceded by a sharp run up in Fed rates. Every one of them. It’s not a record of which to be proud.

…Despite bitter criticisms, President Trump successfully concluded a “new Nafta” deal with both Canada and Mexico covering $1.3 trillion in trade. The deal closes a number of holes in the old Nafta, increasing U.S. access to Canadian dairy markets, for instance, while also making cars tariff-free if 75% of their parts are made in the U.S., Canada or Mexico. All three countries signed off on the deal. The only question is, will it ever go into effect?

With Democrats controlling Congress and just six months for the trade deal to go into effect, some worry that major changes will be requested. President Trump has asked that either the new U.S.-Mexico-Canada Agreement be approved outright, or revert to the pre-Nafta trading rules. Congressional Democrats may even challenge Trump’s right to make a deal, putting the so-called USMCA in limbo. Stay tuned.

…With Americans eager to control immigration, as polls repeatedly show, Democrats may decide that negotiation rather than confrontation is a better tactic. That could mean a deal for a pathway to citizenship for the millennial illegal immigrant “dreamers,” many of whom have lived in the U.S. for most of their lives despite not having citizenship. With an estimated 22 million illegals in the U.S., many states are eager to gain some stability in our immigration policy.

…This year’s budget battle over funding the wall will likely pale in comparison to next year’s. The continued growth in entitlements, compounded by the sharp rise in interest payments, thanks to the Fed’s rate hikes, will balloon the deficit. The Congressional Budget Office’s last official projection pegged the deficit for 2019 at $981 billion. It will likely end up topping $1 trillion.

…But as we’ve pointed out many times, the problem isn’t tax cuts, it’s the unwillingness of anyone in Washington — including Trump — to deal with entitlement programs that have swamped the federal budget. Trump and the GOP will have to stand firm on taxes next year, while grappling with a rising tide of debt that will soon surpass $21 trillion.

…ObamaCare limped along for another year, with premiums for 2019 falling, overall, after years of massive double-digit increases. Trump took several steps to improve ObamaCare. The most important fix was to breathe life back into the short-term insurance market that President Obama tried to snuff out to protect the ObamaCare exchanges. Unfortunately, since Republicans blew their chance at repeal, the best we can hope for is that Trump will continue to tweak the law where he can. But he shouldn’t shy away from fighting for more free-market reforms. Should Democrats resist, or start pushing for socialized “Medicare for all,” it will create an opportunity for Trump to paint Democrats as big-government extremists.

The article concludes:

The coming year will be eventful, with many of Trump’s main initiatives set for action by Congress — a Congress, as we noted, that won’t be as friendly to Trump as the last one. Whether Trump and the Democrats can, as the bumper sticker says, coexist, or whether the Trump agenda founders on a never-ending stream of congressional investigations and hearings on the White House, remains to be seen. We guarantee it won’t be boring.

Get out the popcorn.

The Coast Guard Will Get Paid

Yesterday The Washington Examiner reported the following:

Concerned about U.S. Coast Guard forces losing a paycheck in the partial government shutdown, President Trump personally urged his team to find a solution that would allow the administration to make this week’s $75 million payroll, according to officials.

Trump stepped in on Wednesday, calling on top lawyers and staffers to determine if the Coast Guard could make payroll despite being included in the shutdown that has impacted about 25 percent of the government, including the Department of Homeland Security, which houses the Coast Guard.

Military personnel under the Department of Defense are not included in the shutdown, because their appropriations were approved earlier in Congress.

Officials said that Trump was keen to find a “way we can fix this” as news media stories about the Coast Guardsmen’s plight started to pile up.

At his urging, the Office of Management and Budget, DHS and the Coast Guard determined that the rules governing pay to Coast Guard forces requires it be made through the end of the year. To make it, the lawyers said that unused funding could be tapped for pay. The service had a bit more than the needed $75 million left over from its past continuing resolution appropriation, enough to make this month’s last payroll check.

“The president is trying to make the shutdown as painless as possible for workers, and this case proved it,” said an official.

Remember that only 1/4 of the government is shut down because President Trump had the forethought to get the rest of the budget passed previously. The Democrats (who in the past voted for a fence (a.k.a. wall) have changed their minds and shut down the government because President Trump wants a wall. At least President Trump is attempting to make the shutdown as painless as possible while Representative Nancy Pelosi (who should be in Washington negotiating) vacations in Hawaii.

If It’s Not About The Money, What Is It About?

In January of 2018, The Washington Times noted that the estimated $18 billion over the next decade spent on a border wall between the United States and Mexico would be roughly 0.0338 percent of the $53.128 trillion the Congressional Budget Office currently estimates the federal government will spend over that same 10-year period. So what is all the fuss about?

Yesterday WWF came to the Oval Office in the White House when Representative Nancy Pelosi and Senator Chuck Schumer discussed the border wall with President Trump. YouTube posted the video:

The battle is not about money–it’s about votes. The Democrats have lost some of the voting blocs they have counted on to win elections–they can no longer be sure of the working man’s vote or the union vote. So how are they going to win elections? They are counting on the minority vote. The Democrats are afraid that if the wall is built, they will lose the Hispanic vote.

According to the Pew Research Center, this is how Hispanics voted in 2018:

According to a USA Today article posted November 9, 2016, President Trump did surprisingly well among Hispanic voters:

Hispanics favored Democratic candidate Hillary Clinton 65% to 29%, a 36-point difference that helped her secure winning margins in states like Nevada and Colorado and kept her competitive late into the night in other key battleground states.

But that margin, based on exit polling conducted by Edison Research, was smaller than the 71%-27% split that President Obama won in 2012. And it was smaller than the 72%-21% her husband, former president Bill Clinton, won in 1996.

Because the Democrats are becoming more dependent on the votes of minority groups to win elections, it is easy to understand why they would oppose any legislation or spending that most cost them votes in the minority community.

The Facts vs The Talking Points

Remember when the Democrats said that the Trump tax cuts would blow a huge hole in the deficit because of the money that would not be collected. Those who believed the Democrats need to study the Laffer Curve. Although liberals keep saying it doesn’t work, the history of tax cuts proves it does.

Yesterday Investor’s Business Daily posted an editorial about the impact of President Trump’s Tax Cuts.

The editorial states:

The latest monthly budget report from the nonpartisan Congressional Budget Office finds that revenues from federal income taxes were $76 billion higher in the first half of this year, compared with the first half of 2017. That’s a 9% jump, even though the lower income tax withholding schedules went into effect in February.

The CBO says the gain “largely reflects increases in wages and salaries.”

For the fiscal year as a whole — which started last October — all federal revenues are up by $31 billion. That’s a 1.2% in increase over last year, the CBO says.

The Treasury Department, which issues a separate monthly report, says it expects federal revenues will continue to exceed last year’s for the rest of the 2018 fiscal year.

The editorial concludes:

As we have said many times in this space, the problem the country faces isn’t that taxes are too low, but that spending is too high. The CBO projects that even with the Trump tax cuts in place, taxes as a share of GDP will steadily rise over the next decade, and will be higher than the post-World War II average.

But bringing in more tax revenues doesn’t help if spending goes up even faster. And that has, unfortunately, been the case, as the GOP-controlled Congress has gone on a spending spree.

Look at it this way. Tax revenues are up by $31 billion so far this fiscal year compared with last year. But spending is up $115 billion.

In other words, the entire increase in the deficit so far this year has been due to spending hikes, not tax cuts.

There are too many Republicans in Congress who don’t understand why the American voters sent them there. The Democrats have always loved to spend other people’s money, but the Republicans were supposed to be the alternative to that. Unfortunately, many Republicans have failed the voters. The only way to fix Washington is to unelect every Congressman who votes for spending increases. Otherwise the spending will only get worse.

Why The Republican Party Is Losing Voters

The 2016 Republican Platform includes the following on Page 8:

Reducing the Federal Debt

Our national debt is a burden on our economy and families. The huge increase in the national debt demanded by and incurred during the current Administration has placed a significant burden on future generations. We must impose firm caps on future debt, accelerate the repayment of the trillions we now owe in order to reaffirm our principles of responsible and limited government, and remove the burdens we are placing on future generations. A strong economy is one key to debt reduction, but spending restraint is a necessary component that must be vigorously pursued.

On May 10, 2018, CNS News reported:

The federal government collected a record $2,007,451,000,000 in total taxes through the first seven months of fiscal 2018 (October through April), but still ran a deficit for that period of $385,444,000,000, according to the Monthly Treasury Statement.

It’s the spending–not the revenue–that is the problem. So what are Republicans doing about it?

On May 8, 2018, The Washington Times posted the following:

House GOP leaders vowed Tuesday to speed President Trump’s new $15.4 billion spending cuts proposal through their chamber, brushing aside complaints from Democrats and some Republicans over the trims the White House wants to see.

House Majority Leader Kevin McCarthy on Tuesday predicted the House will pass the package, which includes 38 cuts to programs and generally involves money that’s sitting unused.

So what happened when the bill reached the Senate?

The Daily Haymaker posted the story today:

Senators voted Wednesday to block President Trump’s $15.4 billion spending cuts package, with lawmakers saying it trimmed the budget too much.

Brushing aside administration promises that the cuts were chiefly to money that was never going to be spent, the Senate voted 50-48 to keep the bill bottled up. Two Republicans — Susan Collins of Maine and Richard Burr of North Carolina — joined Democrats to defeat the package.[…]

So if the Republicans won’t even cut spending on money that wasn’t even spent, why in the world should I vote for them? Didn’t they read their own platform? How long could you run up your credit card before creditors would start clamoring for their money? Is the government any different?

 

Pork In The North Carolina Budget

Washington isn’t the only place where lawmakers love to spend money that isn’t theirs. The North Carolina legislature is currently working on its state budget for FY 2018-19. On Monday, Civitas posted an article about the current budget proposal.

The article reports:

The state budget for FY 2018-19 contains nearly 170 line items totaling $30 million that are highly inappropriate or outright pork.

Appropriations directing funding to local pet projects include items such as walking trails, playgrounds, county fairs and highway signs. Moreover, dozens of nonprofit organizations receive direct appropriations in the budget. Make no mistake, these nonprofits perform admirable work. However, it is highly inappropriate – and unfair favoritism – to single out nonprofits for specific appropriations of state tax dollars, instead of having them go through the appropriate grant process.

There is little doubt that a large percentage, if not all, of these earmarks represent legislators trying to “bring home the bacon” to their districts in an election year. State taxpayers should not be forced to finance explicitly local projects.

Note that the items identified in this article include only adjustments made to the second year of the biennial budget passed last year. There no doubt are many more such earmarks that will be doled out this year that were previously included in last year’s budget.

Legislative leaders have rightly been criticized for the closed-door, non-transparent process used in crafting the budget. It is plausible to believe that these 166 line items were the result of political horse-trading behind closed doors, which left virtually no time for objections from legislators before the House and Senate voted.

Such a significant number of earmarks, while not adding up to a major percentage of the budget in dollar terms, raises legitimate concerns about political patronage in which representatives direct state funds to local projects in exchange for political support.

Please follow the link above to read the entire article. It includes a specific list of the earmarks in question.

Countering Fake News

The major media sources are all abuzz with the fact that President Trump is denying food to senior citizens by cutting Meals on Wheels. How awful. How awful that the media is reporting something that is not true. Meals on Wheels only gets a small percentage of its funds from the Community Development Block Grant (CDBG) programs. The cuts President Trump is making will have little or no impact on Meals on Wheels.

The Conservative Review posted an article today explaining the details:

President Donald Trump is catching hell from the media over accusations that his budget will cut off funding for Meals on Wheels as part of his proposal to eliminate funding for Community Development Block Grant (CDBG) programs.

Most of the media’s hysterics are exaggerating the effects of the Trump proposal, or being downright dishonest about CDBGs. Examine what Office of Management and Budget (OMB) Director Mulvaney actually said during Thursday’s press conference on the budget, in response to a question on Meals on Wheels.

“As you know, or I think you know, Meals on Wheels is not a federal program,” he began. “It’s part of that community that CDBGs — the block grants that we give to the states, and then many states make the decision to give that money to Meals on Wheels.” (emphasis added)

The article goes on to mention that the government has spent $150 billion on CDBG programs since 1970 and has no results to show for it.

The article explains the problem:

This program is ineffective because the administration of these funds is often absolutely corrupt. In 2013, the House Financial Services Oversight and Investigations Subcommittee identified “more than $770 million in questionable costs and included recommendations for putting $739.5 million in HUD funds to better use.” The subcommittee identified CDBGs as one of HUD’s largest programs that “lack proper oversight” and are “especially vulnerable to waste, fraud, and abuse.”
The article goes on to list some of the abuses in past use of CDBG money. Please follow the link above to read the entire article. President Trump is acting like a businessman–he is cutting funds to programs that do not work and moving funds to programs that show results. If we are ever to find a way out of our increasing debt, these are the steps that will be necessary. It is a shame that the mainstream media wants to continue to increase the debt that our children and grandchildren will have to pay off.

One Reason Government Spending Is Out Of Control

On Saturday the Washington Post posted an article about some of the end-of-the-year spending done by government agencies. The spending is a result of one of the side effects of baseline budgeting, which is something our government needs to get rid of. Baseline budgeting is the concept that a department’s budget is based on how much money they spent in the previous year. If they spend 90 thousand dollars and their budget was 100 thousand dollars, the department budget will be 90 thousand dollars in the following year. If they don’t spend all of the money in their budget, their budget is cut. This creates a mad rush to spend their entire budget by September 30, the end of the fiscal year. If they spend the full amount and ask for a 10 percent increase and get a 5 percent increase, that is considered a 5 percent budget cut. That is how Congress can claim they are cutting the budget while the spending continues to increase. These two concepts explain some of the rather interesting end-of-the-year spending done in the past few weeks by the government. As you read this, remember that this is under sequestration when Democrats are complaining that there is no money.

The article posts some examples of spending in recent weeks:

On Monday, VA paid $27,000 for an order of photographs showing sunsets, mountain peaks and country roads. They would go into a new center serving homeless veterans in Los Angeles; a spokeswoman described the art as “motivational and calming, professionally designed to enhance clinical operations.”

On Tuesday, the USDA bought $127,000 worth of toner cartridges (“end of year,” the order explained). VA spent another $220,000 on artwork for its hospitals.

On Wednesday, the Coast Guard paid $178,000 for cubicle furniture, replacing high-walled cubes with low-walled ones to improve the air flow in a large office area.

“Other higher-priority projects were not able to be executed, so they moved [money] to this lower-priority project” before the year’s end, said Coast Guard spokesman Carlos Diaz. “The money was going to be spent anyway.”

On Thursday, VA was buying art again. It spent $216,000 on artwork for a facility in Florida. In all, preliminary data showed that the agency made at least 18 percent of all its art purchases for the year in this one week. One-sixth of the buying in one-52nd of the year.

This is not a reasonable system. There is a spreadsheet at adelphi.edu that shows the federal deficit over the years. When President Obama took office, the deficit was approximately 12 million dollars. The deficit is now approaching 17 million dollars. That’s a pretty hefty increase in five years. However, the really interesting part of the spreadsheet is the relationship between the deficit and which party controls the House of Representatives. Remember, the House controls the spending. Please follow the link to the spreadsheet and take a look at the history of the federal deficit.

At any rate–baseline budgeting needs to go.

 

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Let’s Put The Budget Together Right After The Company Christmas Party

Putting the budget together for a business right after the company Christmas party is ridiculous, right? Well, evidently the United Nations has done that consistently in the past.

ABC News posted a story today quoting Ambassador Joseph M. Torsella, who represents the U.S. on the U.N.’s budget committee.

The story reports:

Ambassador Joseph M. Torsella, who represents the U.S. on the U.N.’s budget committee, said Monday that the tense process of negotiating the world body’s annual budget is made more complicated by the number of diplomats who turn up drunk.

The U.N. budget is finalized in December, when holiday parties apparently lead to some revelry spilling over into budget negotiations.

The U.S. is making “the modest proposal that the negotiating rooms should in future be an inebriation-free zone,” Torsella said during a private meeting of the budget committee. The U.S. mission released a transcript of his remarks.

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Why The Senate Keeps Passing Continuing Resolutions Instead of Passing A Budget

As a teenager (back in the age of dinosaurs), one of the things I remember is being asked to read the newspaper as a part of high school history class. I was not a news junkie back then, and reading a newspaper (the New York Times was the school’s paper of choice) was a very frustrating experience. When reading the articles, I often felt like someone who walks into the theater in the middle of the movie. Even if I understood the story, I had no clue to the events that had preceded the story. Some of the budget debates in Congress have given me that same feeling.

The Senate has not passed a budget since 2009. Why? Well, it seems that the answer is actually rather simple. About.com has an information page about the 2009 Budget. The page explains that the 2009 Budget created the largest deficit in the history of America ($1.413 trillion). The 2009 Budget was unusually large because of the extra spending needed in the recession. There are some valid questions as to whether that level of spending is still needed since we are supposedly in the midst of an economic recovery. However, by passing Continuing Resolutions rather than a budget, the Senate can continue the levels of spending in the 2009 Budget. Because of the concept of ‘baseline’ budgeting, government spending will be based on the numbers in the inflated 2009 Budget–without any debate on the validity of those numbers. That is the reason for continuing trillion dollar deficits, and it also explains why the Senate has not been willing to discuss or pass a budget since 2009.

We are about to enter a debate on raising the debt ceiling of America. I strongly suggest that the Republicans in Congress (I don’t expect the Democrats to do this, although it would be wonderful if they did.) should demand that the Senate pass a budget before they agree to raise the debt ceiling. If we are going to increase the amount of money given to Washington, we need to know ahead of time how they are planning to spend it. Just one more note on the budget. As Congress continues spend more than it takes in, the Treasury continues to either borrow money or print money. As more money is printed, the value of the money already in circulation decreases. That is one of many reasons the cost of gasoline at the pump is higher than the current cost of crude oil at the pump warrants (It should be noted that the state and federal government make more money on the sale of a gallon of gas than the oil companies that sell the gas). That is one way runaway spending by the government impacts all of us. It is time to take the charge card away from Congress and force them to live within their means.

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This Really Doesn’t Sound Like A Plan

Hot Air posted a video today of some of the Congressional hearings on the President’s proposed budget. The clip they posted is of Paul Ryan asking United States Secretary of the Treasury Timothy Geithner what the President’s budget does to help end future deficit spending. I strongly suggest that you follow the link and watch the video.

There is a great quote in the video:

Geithner states, “We’re not coming before you today to say that we have a definitive solution to the long term problem, what we do know is we don’t like yours.”

In other words, why, no, our new budget does nothing to address America’s long-term fiscal crisis.

If our current administration is not willing to address America’s long-term fiscal crisis, let’s elect an administration that will be.

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Giving Money To The Rich At The Expense Of The Poor

No, I am not about to support the class warfare that President Obama is planning to use to win a second term in the White House. What I am referring to is the fact that under the budget suggested by President Obama government subsidies for people who purchase a Chevy Volt will be raised to $10,000 while the scholarship program in Washington, D.C. will be eliminated.

Hot Air posted a story yesterday on the budget.

Speaking of the D. C. Opportunity Scholarship Program (OSP), the article states:

Enrollment increased 60 percent last year, with parents “rushing” to sign their kids up, after the new GOP House renewed the program for five years. That’s the good news — since Congress is likely to become redder this fall, the GOP will be able to force a penny-ante budgetary matter like this on Obama even if he’s reelected. The bad news is that O is so deeply captive to public-school teachers’ unions that he’d rather risk the optics of canceling a school-choice program for poor kids knowing that it’ll end up in the budget anyway than embrace it and anger his PEU cronies. Loathsome.

Meanwhile, people who can afford a $50,000 car will get a tax break which will cost the government $100 million each year if it is approved by Congress, presuming only 10,000 new-technology autos are sold each year.

This is another example of the Obama Administration telling Americans what to buy. It is a political move designed to shore up environmental support for President Obama in an election year. Meanwhile, the students in Washington, D.C. are tossed aside.

I think this President has his priorities backwards.

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A Great Idea That Will Probably Die In The Senate

On Friday, the Daily Caller reported that Harry Reid told reporters that the Senate would not pass a budget this year. Senator Reid did not feel a budget was necessary because he felt that the debt-ceiling agreement already covered that. Never mind that the Senate is constitutionally required to pass a budget.

To add to the confusion, CNS News reported on Friday that the House of Representatives has now passed a bill to eliminate baseline budgeting. Baseline budgeting is the practice that allows Congress to claim it is cutting the budget while it continues to increase spending. This is done by assuming every government agency will have a certain percentage increase every year. If the amount of that increase is cut, it is a considered a spending cut, even though the agency got an actual increase in the amount it could spend. For example, let’s say the Department of Education spent $100 this year. Next year they would automatically get $110. If Congress cut the budget and they were only given $105, that would be considered a budget cut, even though their budget grew.

That is baseline budgeting. That is what the House of Representatives voted to end on Friday. Is anyone willing to make a bet on how far this bill will get in the Senate?

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