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Posts Tagged ‘fiscal conservatism’

Our Man Mitch?

December 3, 2009 1 comment

For someone who recently has begun making sport out of saying no to a possible presidential bid, Mitch Daniels sure is making a heck of alot of sense whenever he does speak (though some may argue that commonsense’s natural momentum is away from those seeking higher office). From the Washington Times (h/t Brothers Judd), Daniels of fiscal conservatism as a moral issue:

“The essence of our nation is the protection of individual liberties,” he says in an interview with The Washington Times. “That means, for example, never take a dollar from a free citizen through the coercion of taxation without a very legitimate purpose.

“And then we have a solemn duty to spend that dollar as carefully as possible, because when we took it we diminished that person’s freedom. Otherwise, that citizen could spend that dollar on something he or she chose. This is an obligation of everybody who serves in government.”

On the issues any 2012 contender will need to address:

For one thing, “a colossally unsustainable [national] debt load — an unfair, even immoral burden we’ve deposited on our young people,” he says.

“The threat of Islamic fundamentalism coupled with its ability to take advantage of modern technology,” for another.

And then there’s “our reliance on energy purchased from people who use the money in ways contrary to American interests.”

And perhaps most refreshing–modesty and austerity (a topic he gave an entire commencement address on this past spring):

A Princeton graduate from a modest family background, he conveys in conversation the image of the quiet-spoken libertarian-populist for whom braggadocio is simply unthinkable. Getting him to talk about his accomplishments isn’t easy. “I want to look to the future,” he says.

….

Ask him to crow about his gubernatorial accomplishments, and he flatly refuses. Press him by asking if there’s anything he’s proud of having done in office, and you learn he is “pleased” he took a state that was in bankruptcy when he came into office “and put it in the best fiscal position ever,” though he acknowledges that holding on to that status is tough in this economy.

The article goes on to cite some of his accomplishments as Governor. He has been able to govern the way Bob McDonnell promises to–conservative principles guiding real results. Through initatives such as privatizing the state’s toll roads and keeping an eye on state payroll (actually managing to REDUCE it, of all things), Daniels has been able to cut property taxes by a third statewide and affect the largest tax cut in state history.

Perhaps his biggest watchword? Accountability. The state’s DMV went from being a joke to winning an award for the best in the nation. The average time spent in an office is SEVEN MINUTES. How was this accomplished? By rewarding good employees and punishing or removing bad ones. Sorta sounds like a business, no? Yet Mitch Daniels seems to be the only one with the courage to do it.

I encourage any conscientious conservative serious about cutting government size and scope to look into this man.  I will admit he has one mark against him–in his first year in office he proposed a 1% income tax hike. But when the state legislature balked, he simply took out his scissors and not only made state government work with less but work better. His humility may prevent him from talking about higher office, but one things for sure: I’d rather spend the next two years convincing him to run only to see him decline than to jump on the Cheney 2012 bandwagon.

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The evidence is really piling up….

November 23, 2009 Leave a comment

Limited government has become the cause du jour for the right these days, after over a decade of social issues such as gay marriage and abortion driving many a campaign and cause. Certainly these issues maintain relatively high profiles (abortion has been inextricably woven into the health care debate, and gun control is still at the tip of the tounges of those warning against increased government intrusion), but these days halting government expansion is the biggest concern for conservatives. It makes sense. Many conservatives are left bemoaning the fact that too little too late was said about these issues during the Bush years, and the legendary defecits that were piled up during that era are now only being heightened by Democrats compulsion to be all things to all people.

Indeed, the much touted government intervention into our economy seems to have done little in the short term to create jobs. Indeed, government intervention in the area of unemployment is actually HURTING employers. (H/T Hot Air) From the Associated Press:

• Chuck Ferrar, who owns a liquor store in Annapolis, Md., expects to pay $9,000 in unemployment taxes next year, up from $3,000 this year. Health care costs for his employees will rise by $8,000, or 17.5 percent. “When you start adding this up, it turns into real money,” he said. “If I lose an employee through attrition, I will not replace him. You can’t afford to do it.”
• Sam Schlosser, owner of Plymouth Foundry Inc. in Plymouth, Ind., said his unemployment tax bill could double next year. Revenue at the family-owned company, which makes iron castings for machine parts, has fallen about 50 percent, he said. In case of higher taxes, his company may have to consider layoffs, he said.

Why is this the case? Because states are required to change their rates each year in accordance with the rate of unemployment. But because the economy is so deep to begin with many states are running out of cash. The real rub?:

But the severity of this recession has bankrupted many states’ trust funds and forced them to borrow from the federal government. States eventually must pay back the loans. Otherwise, the federal government can raise taxes on their businesses.

So let me get this straight–a government program that is designed to help the jobless actually puts them in a worse position by making it harder for businesses to hire? Typical interventionist logic.

The good news, though: there’s evidence that fiscal conservatism does and has worked. A new working paper from two Harvard economists indicate that not only do tax cuts make it more likely for an economy to rebound, but spending adjustments both help the overall fiscal picture AND are less likely to spur a recession. The money quote, via The Corner:

“Fiscal stimuli based upon tax cuts are more likely to increase growth than those based upon spending increases. As for fiscal adjustments those based upon spending cuts and no tax increases are more likely to reduce deficits and debt over GDP ratios than those based upon tax increases. In addition, adjustments on the spending side rather than on the tax side are less likely to create recessions.”

You can check out the paper in its entirety here. Despite this academic exercise, I’m afraid that the American people are destined to learn the results of statism through hard won experience this go around.