Freedom Line Blog

Two bills before the Texas legislature, H.B. 259 and H.B. 3675, propose new and unwarranted taxes on satellite television providers.  This period of high unemployment and economic uncertainty is no time to be raising taxes in the first place.  But here’s the kicker:  those two bills would essentially tax thin air.

H.B. 259 and H.B. 3675 would impose taxes on something satellite television providers don’t even use – the physical public right of way.  Obviously, reasonable people could understand why entities that actually use the public right of way under city streets or along physical power lines must help maintain those rights of way.  Since satellite video doesn’t even traverse any physical right of way, however, H.B. 259 and H.B. 3675 constitute a tax on thin air.  Moreover, Texas already taxes video services, so imposing yet another entirely new tax upon physical rights of way that satellite providers don’t even use makes these two bills even more manifestly unfair.  Additionally, it is estimated that only 10% of right of way taxes actually go to maintenance, with 90% of collected revenues diverted to general city funds.  In other words, these two proposed bills are a transparent money grab.

We at CFIF have therefore sent a letter of to the House State Affairs Committee to assert our opposition on behalf of 17,000 activists and supporters in the state of Texas.  But you can also help by contacting them as well via this link. 

Make it clear to these legislators that now is not the time to raise taxes, especially when what’s being taxed is nothing more than thin air.

In this era of bureaucratic overreach and unsustainable spending and deficits, should government also enter the business of competing against private communications service providers?  Doesn’t it already have its hands full?

We at CFIF think so.  In fact, we testified last month before the North Carolina legislature on behalf of thousands of supporters and activists across that great state in support of H.B. 129, which would restrain government bureaucrats from unfairly competing against private providers of communications services.   And with good reason.  From Taiwan to Australia, from Chicago to Houston, and inside North Carolina itself, the history of public broadband is without exception one of failure.  Every single public broadband project of which we’re aware has failed to so much as break even.  Ultimately, taxpayer bailouts become necessary as government endeavors lose money and require constant upgrades to keep pace with evolving technology.  Moreover, government broadband boondoggles undermine the billions of dollars invested in private network improvement and expansion, and discourage future private investment.  After all, why risk one’s capital to compete against governments that can manipulate the rules and go to taxpayers for bailout?  Inevitably, poorer service and layoffs in the vibrant tech sector result.  Rural communities particularly suffer.

But none of that logic seems to matter to Democratic FCC Commissioner Mignon Clyburn.   In a statement Monday, Clyburn attacked the North Carolina’s sensible legislation and defended the concept of government entering yet another portion of the private sector.   Perhaps that’s not surprising, considering Clyburn’s vote last December to impose so-called “Net Neutrality” in the face of two-to-one public opposition, a unanimous Court of Appeals decision that the FCC didn’t possess such authority and condemnation from bipartisan groups in Congress.

Predictable or not, however, it is critical that Americans at the federal, state and local level vocally oppose the sort of government tech sector overreach that she advocates.

This week provides a stark contrast between a leader actually willing to risk political capital, versus a man who now seeks four more years of politics-as-usual.

On the one hand, we have House Budget Committee Chairman Paul Ryan (R – Wisconsin).  Tomorrow, Congressman Ryan will unveil a federal budget proposal that reduces spending by $4 trillion over the coming ten years, provides pro-growth tax reform and caps runaway federal spending.  All without reducing Social Security benefits by a single penny for anyone already receiving them or over 55 years of age, along with Medicare reform that will save it from its catastrophic fate if nothing is done.  Congressman Ryan knows full well that by offering budget leadership, Democrats will possess a “political weapon” to use against him, even if it means that “they will have to lie and demagogue” to do so.  But instead of shrinking, he has chosen leadership.

On the other hand, we have the President of the United States.  The purported leader of the Free World.  The most powerful man on Earth.  The man who formed a blue-ribbon deficit commission, then proceeded to ignore it.  Instead of making sure that a Congress dominated by his own party could even manage to pass a 2011 budget, instead of offering decisive world statesmanship amid worldwide crises and instead of providing leadership in averting a national debt catastrophe, Obama instead focused on unveiling his 2012 reelection campaign this week.  Instead of offering a plan, the AWOL Obama will apparently just sit back and attack Paul Ryan’s.

So there you have it.  One man seeks to cut spending by $4 trillion, and the other man seeks to spend $1 billion getting himself reelected.

Join CFIF Corporate Counsel and Senior Vice President Renee Giachino today from 4:00 p.m. CST to 6:00 p.m. CST (that’s 5:00 p.m. to 7:00 p.m. EST) on Northwest Florida’s 1330 AM WEBY, as she hosts her radio show, “Your Turn.”  Today’s guest lineup includes:

• 4:00 p.m. CST/5:00 p.m. EST:  Representative Thaddeus McCotter (R-MI), “Seize Freedom”;
• 4:30 p.m. CST/5:30 p.m. EST:  Gary Beckner, Executive Director, American Association of Educators;
• 5:00 p.m. CST/6:00 p.m. EST:  Bill Whalen, Fellow, Hoover Institution;
• 5:30 p.m. CST/6:30 p.m. EST:  Hadley Heath, Policy Analyst, Independent Women’s Forum.

Listen live on the Internet here.   Call in to share your comments or ask questions of today’s guests at (850) 623-1330.

As the House and Senate enter budget negotiations, House Speaker John Boehner and Majority Leader Eric Cantor must not sacrifice the Kline Amendment de-funding the Obama Education Department’s so-called “Gainful Employment Rule” on the altar of false compromise.

The Gainful Employment Rule, which sets arbitrary bureaucratic formulas for federal student loan repayment, is a transparent attempt by the Obama Administration to cripple private career colleges.  And the tale of its creation is a long, sordid one.  First, there were allegations of insider trading between Education Department officials and short-sellers with a financial interest in seeing career colleges’ stock prices fall.  Then, the the Government Accountability Office (GAO) had its sting operation against career colleges exposed as defective, ultimately forcing its retraction.  These allegations are serious enough that separate investigations were commenced in the Senate and House.

Fortunately, a bipartisan group in the House of Representatives voted to de-fund any enforcement of the Gainful Employment Rule in budget bill H.R. 1.  In an era of intense party acrimony, the fact that opposition to the Gainful Employment Rule attracted strong bipartisan agreement speaks volumes.  Now, it’s a matter of Speaker Boehner holding strong on de-funding implementation of the rule, rather than offering it as “trade bait” to Senate Democrats.  Please don’t allow the Kline Amendment de-funding the Gainful Employment Rule to become a casualty of politics as usual, Speaker Boehner.

For everyone astonished or disgusted at the ease by which the political left either defends Obama vis-a-vis Libya or stifles the hysteria it unleashed against George W. Bush, there’s now a must-see video for you.  From “Obama is awesome” to Fox News slurs to citing “Saturday Night Live” or “The Colbert Report” as authority, the rationalizations offered by the female avatar defending Obama will sound familiar and elicit laughter.  Watch as the Obama defender’s male counterpart explains that Bush’s Iraq coalition was actually broader than Obama’s “multilateral” effort, that Bush actually obtained Congressional approval while Obama did not and that Saddam Hussein’s record of slaughter dwarfs Colonel Gadhafi’s:

The Pentagon doesn’t want it.  The Senate has voted it down.  The House has voted it down.  The Bush White House sought to stop it.  The Obama White House has sought to stop it.

Yet the unnecessary duplicate engine for the new F-35 Joint Strike Fighter refused to die, riding the wave of Washington, D.C. pork-barrel political force.

Fortunately,  the Defense Department has ordered General Electric and Rolls-Royce to stop wasting dollars on a second engine for the F-35.

Pratt & Whitney serves as the main producer of the F-35 engine, but forces in Congress perpetuated the wasteful General Electric and Rolls-Royce second engine.  Although both the House and Senate have voted to end the second engine and allocate those precious defense dollars on more critical needs, the project kept going because the previous Congress never passed a 2011 budget.  That left the Defense Department to operate on continuing resolutions based on the fiscal 2010 appropriations.

It’s an embarrassing illustration of wasteful Beltway politics, and a reminder of what we who favor fiscal sanity must continually overcome.  Fortunately, the Defense Department just provided an assist in that effort.

A troubling trend seems to be emerging in the defense industry—outsourcing national security to foreign companies.

We recently learned that two defense companies are competing for a proposed American attack aircraft contract: Hawker Beechcraft of Wichita, Kansas, and a Brazilian company named Embraer.  One particularly disturbing fact is that Embraer receives subsidies from the Brazilian government, which has publicly opposed the War on Terror and American efforts against Iran and Venezuela, but now seeks to profit from that same U.S. commitment to military strength.  Another troubling item is an unconventional clause in the potential Embraer contract known as the “Golden Share” clause.  Under that provision, the Brazilian government would be empowered to shut down the operation at any time during the production or maintenance of the aircraft.  Alarmingly, the United States would have no means for recourse on the matter.  That’s not very “golden” for American interests.

Additionally, awarding the contract to Hawker Beechcraft would sustain an estimated 1,400 domestic jobs, whereas Brazil’s Embraer would offer only 50 final assembly positions.  Moreover, the Hawker Beechcraft AT-6 is based upon an aircraft already in wide use by the U.S. Air Force, the U.S. Navy, the North American Treaty Organization (NATO) and other American allies.  Consequently, that familiarity and logistical infrastructure advantage would allow for substantial cost savings over the new aircraft’s life cycle.  This is particularly important at a time when the Defense Department seeks cost control measures.

For these reasons, CFIF has written Defense Secretary Robert Gates, urging him to carefully consider these issues.

Americans just witnessed a similar episode between Boeing and foreign company EADS, and outsourcing defense to foreign companies is simply bad policy.  America cannot afford to jeopardize domestic jobs or our national security.

Gallup released a fascinating survey this week, under the heading “U.S. Steady as the Most Popular Destination for Potential Migrants.”

In fact, it’s not even close.  Using aggregated data compiled from 148 nations during the years 2007 through 2010, survey subjects were asked, “Ideally, if you had the opportunity, would you like to move permanently to another country, or would you prefer to continue living in this country?  To which country would you like to move?”  The United States was the runaway leader, with more than three times as many respondents as the next closest countries (Canada and the United Kingdom).  The U.S. led with 24%, Canada and the U.K. were far behind at 7% each, with France at 6% and Spain at 4%.  In fact, America was named as the top potential destination by as many people as the U.K., France, Spain, Germany and Italy combined.  So much for that supposedly superior European model.

President Obama may not believe in American exceptionalism, but apparently the rest of the world that he strangely seeks to follow rather than lead still does.

Apparently, whatever jobs labor unions don’t drive overseas or eliminate entirely are made worse by them.

According to a just-released Gallup survey, “U.S. Union Workers Score Lower on Work Enforcement Index.”  On a variety of measures, from the sense of employee/supervisor partnership to overall trust, unionized workplaces simply maintain substantially lower levels of workplace wellbeing.  Ultimately, as the Gallup report states, unionized workplaces impact the factors that “in turn have well-documented associations to various desirable business outcomes, including customer engagement, turnover, absenteeism, and productivity.”

As critical standoffs between taxpayers and intransigent labor bosses in Wisconsin and across the nation continue, this new Gallup survey sheds some important information on the matter.

Yesterday, the new House of Representatives took another step to make good on its campaign promises last fall to the American people.

The House Energy & Commerce Committee, by a 30 to 23 vote, approved a resolution prohibiting Obama’s rogue Federal Communications Commission (FCC) from imposing so-called “Net Neutrality” on the nation’s Internet sector. This follows last week’s 15-8 vote by the Communications and Technology Subcommittee on the same issue. The FCC doesn’t possess the legal authority to regulate the Internet via “Net Neutrality” in the first instance, as a unanimous court of appeals ruled last year.  Further, Americans oppose this sort of Internet regulation by a solid two-to-one margin, and a rare bipartisan majority of 300 from Congress has formally instructed the FCC against pursuing this lawless course.  Ignoring all of that, the FCC rammed through “Net Neutrality” by a partisan 3-2 vote in December.

Big-government activists claim that “Net Neutrality” is somehow necessary to prevent Internet service providers, who invest the tens of billions of dollars necessary to create the networks on which the Internet passes, from blocking various websites or maliciously discriminating in Internet traffic.  But they cannot explain why that hypothetical epidemic of blockage has never occurred despite two decades of explosive Internet growth in our lives.  And with good reason – any service provider that did so would quickly find itself out of business due to irate customers.  But never mind that.  What are facts, after all, against the desire to add yet another sector of the American economy to the Obama Administration’s regulation?

Fortunately, Americans know better.  And just as fortunately, Congress and the courts are doing something about it.

Yesterday, we noted that Obama’s 2012 reelection odds may not be as high as many currently assume, especially with even higher inflation, gas prices and international chaos on the horizon.  Recalling 1991 and the supposedly invincible President George H. W. Bush, Byron York makes the same point with a brilliant summary quote:

Back in 1991, the pundits discussed how hard it would be to defeat a president with a job-approval rating of 90 percent.  Now, they’re talking about how hard it would be to defeat a president with a job approval rating of 47 percent.”

Owsley Stanley, the famed 1960s “King of LSD” who helped pioneer the Grateful Dead’s trademark sound, has died following an auto accident in his adopted home country of Australia. So what led him to abandon America and flee to Australia, anyway?

It’s actually instructive regarding our current political climate.  Apparently, he became convinced during the 1970s that global cooling was about to trigger a new ice age, so he relocated to the southern hemisphere, which he considered less subject to that supposed oncoming disaster.  Mr. Stanley, of course, wasn’t alone in the global cooling hysteria.  Among others, Newsweek and The New York Times repeatedly sounded the alarm, and continuing climate alarmist Paul Ehrlich predicted massive crop failures and starvation.

Rest in peace, Owsley Stanley.  And thank you for the sobering lesson of the ephemeral nature of climate change alarmism amid the current fashion of global warming.

According to a Wall Street Journal survey of economists, unemployment for the November 2012 election will remain elevated at 7.7%.  That would make it the highest for a presidential election since the Carter/Ford nailbiter in 1976, when it was 7.8%.

Ominously, the report adds, “Economists in the survey slightly raised the likelihood of recession over the next 12 months to 14%, largely due to rising oil prices.”  The article endeavors to highlight the caveat that, “analysts point out that it is often the overall trend – rather than the level of joblessness – that determines an incumbent’s fate.”  The 7.8% rate of November 1976 (in which the incumbent Ford lost), however, had declined from 9.0% in May of 1975, 8.3% one year earlier and 7.9% at the beginning of 1976.

Liberal pundits appear eager to claim that no Republican wants to take on the supposedly strong Obama, but this survey and storm clouds in the form of higher gas prices, overall inflation and worldwide chaos may suggest otherwise.

Remember when the Obama Administration proposed thousands of new Internal Revenue Service (IRS) agents to enforce ObamaCare’s mandate that American businesses file 1099 tax forms every single time they spent over $600 with any supplier?  The resulting uproar was loud and justified.

Unfortunately, reports suggest that Obama’s Department of Education (DOE) similarly seeks to snoop through private IRS records to enforce its destructive “Gainful Employment Rule” against for-profit career colleges.

We at CFIF have chronicled the Obama Administration’s ongoing effort to cripple for-profit colleges via that rule, which would limit financial aid to students attending career colleges based upon arbitrary income data.  Along the way, we reported allegations of collusion between DOE personnel and short-sellers who had wagered that for-profit college stocks would decline.  Those allegations were sufficiently grave to trigger investigation by Senators Tom Coburn (R – Oklahoma) and Richard Burr (R – North Carolina).  Then, the GovernmentAccountability Office (GAO) withdrew, then revised and republished a defective study originally released last summer involving undercover “students” sent to capture information on for-profit colleges.  The GAO’s revisions all slanted in one direction – the original report inaccurately cast career colleges in an unfavorable light, while the revisions indicate that the GAO’s undercover students may have intended to entrap career college admissions personnel.  According to the GAO’s own estimate, only 1 percent of reports require correction, and the statistical likelihood that all of its flaws skewed in the same direction (unfavorably toward for-profit colleges) was 1 in 65,536.  Tellingly, the stock value of for-profit colleges reportedly fell 14%, or $4.2 billion, following the GAO report.

Now, instead of simply using aggregated, readily-available Bureau of Labor Statistics (BLS) data to enforce their Gainful Employment Rule, the DOE seeks to access private, individualized IRS records.  Not only does this intrude upon individual citizens’ private information, it serves to deter Americans from exercising free will in choosing the colleges that best fits their needs.  Additionally, as noted by Cesar Conda in The Washington Times, the Obama DOE’s effort constitutes a new get-rich scheme for the trial lawyer lobby:

The Department of Education should admit that it is using the Internal Revenue Service to send a not-too-subtle message to prospective students:  Attend a for-profit college, and risk that your private financial data may be analyzed to ensure that all your financial transactions are accounted for and allowed.  Thus, the Department of Education, rather than putting the interest of students first, is forcing hardworking adults to go through yet another hurdle to pursue upward mobility.  In their war against individual freedom and personal choice, the nanny bureaucrats never rest; they also roll out the red carpet for the trial lawyers. Clearly, the actual impact of such tracking of student incomes by the IRS will create a new business opportunity for class-action law firms, which will use these new student financial statistics, assembled and provided the Department of Education, to justify billion-dollar litigation.”

So in addition to crippling private career colleges that it considers politically unfavorable, the Obama Administration apparently wants to pore through students’ confidential IRS individual data.  Congress must maintain its current effort to defund this Obama Administration abuse, and Americans must support that effort and maintain its resolve.

As we predicted from the start, so-called “Net Neutrality” continues down its path toward inevitable defeat.

Today, the House Energy and Commerce Communications and Technology Subcommittee voted by a lopsided 15-8 margin to overturn the rogue effort by Obama’s FCC to add the Internet to the Administration’s laundry list of commandeered industries.  The American public opposes “Net Neutrality” Internet regulation by two-to-one margins, a court of appeals unanimously ruled it beyond the FCC’s proper authority and a bipartisan group of 300 members of Congress instructed the FCC to refrain from this abusive effort.  Despite those realities, the FCC arrogantly voted in December to impose “Net Neutrality,” just as the Obama Administration seeks to impose card check, carbon cap-and-tax and other unpopular schemes via unaccountable and unelected federal agencies.

Today’s resolution will now proceed to the full House Energy and Commerce Committee, and a similar legislative effort to overturn “Net Neutrality” is underway in the Senate.  Meanwhile, a lawsuit proceeds in the same court that last year overturned “Net Neutrality,” meaning that the only question now is whether this ill-advised bureaucratic overreach will meet its end legislatively or judicially.  Either way, it can’t come soon enough for investors in our nation’s critical Internet sector.

Two months ago, when Obama’s Federal Communications Commission (FCC) passed its “Net Neutrality” proposal by a partisan 3-2 margin, we guaranteed that it would inevitably be defeated via legislation, the courts or both.

Sure enough, last month Verizon Communications challenged the FCC’s rogue vote in the U.S. District Court of Appeals for the D.C. Circuit, the same court that unanimously ruled last April that the FCC doesn’t possess lawful authority to impose Net “Neutrality.”  Now this week, both the House and Senate introduced resolutions to repeal the FCC’s rogue action.  The resolutions were introduced pursuant to the Congressional Review Act, which allows Congress to review and overrule federal agency regulations via simple majority.  Importantly, such resolutions are not subject to normal Senate filibuster hurdles.

“Net Neutrality” constitutes a destructive and illegal federal intrusion into the Internet, which has managed to flourish just fine over the past two decades without Obama Administration micromanagement, thank you very much.  The American public opposes it by a 2-to-1 margin, courts have rejected it unanimously and Congressional opposition is bipartisan.  While “Net Neutrality’s” demise is a matter of when, not if, it is still absolutely critical that we as citizens maintain our resolve to spare the Internet sector from becoming bureaucrats’ tech version of ObamaCare.

Finally, some good news to report on the Collegegate front.

A bipartisan group of Congressional Republicans and Democrats is preparing to take action that would interrupt the Obama Department of Education’s plans to unfairly cripple career colleges.  Chairman John Kline (R-MN) of the House Education and Workforce Committee, Chairwoman Virginia Foxx (R-NC) of the Subcommittee on Higher Education, and Representatives Alcee Hastings (D-FL) and Carolyn McCarthy (D-NY) are expected to offer an amendment later this week blocking Education Department funding for implementation of the abusive so-called “Gainful Employment Rule.”  In order to put an end to this overly burdensome regulation, we must show our support for providing education opportunities for students who attend career colleges, and urge Congress to support defunding the Gainful Employment Rule.  Please use CFIF’s directory to call your Member of Congress now, and tell them to support the Kline/Foxx/Hastings/McCarthy Amendment to the Fiscal Year 2011 Continuing Resolution on Gainful Employment.

Last month, we noted with alarm that the Congressional Budget Office forecast a record $1.5 trillion federal budget deficit for fiscal 2011.

It’s apparently even worse than that.  Today, the Obama Administration unveils its proposed budget, projecting that this year’s deficit will actually reach $1.6 trillion.  So after telling Americans during his 2008 campaign that he was going to go through the budget “line-by-line” and reduce the deficit, Obama has given us deficits of $1.4 trillion, $1.3 trillion and now a record $1.6 trillion.  And what to show for it?  Unemployment remains at or above 9% for a post-World War II record 21st consecutive month, despite Obama’s promises that it would top out at 8% in October 2009 and decline to between 6% and 7% today.

As for those who continue their mindless “Blame Bush” rationalization crusade, they must explain how three years into the Age of Obama, the deficit is increasing, not decreasing, from $1.3 trillion to $1.6 trillion (an almost 25% increase).

Join CFIF Corporate Counsel and Senior Vice President Renee Giachino today from 4:00 p.m. CST to 6:00 p.m. CST (that’s 5:00 p.m. to 7:00 p.m. EST) on Northwest Florida’s 1330 AM WEBY, as she hosts her show “Your Turn.”  Today’s star guest lineup includes:

4:00 p.m. CST/5:00 p.m. EST:  Pete Sepp, Executive Vice President, National Taxpayers Union;

4:30 p.m. CST/5:30 p.m. EST:  Mike Carey, President of American Council for Affordable Energy, Impact of Egypt Crisis on America;

5:00 p.m. CST/6:00 p.m. EST:  Bill Bascoe, Executive Vice President, Citizens for the Republic, ObamaCare Ruling;

5:30 p.m. CST/6:30 p.m. EST:  Timothy Lee, Vice President of Legal and Public Affairs, Center for Individual Freedom, Reshaping the Judiciary and Reagan at 100.

Please share your comments, thoughts and questions at (850) 623-1330, or listen via the Internet by clicking here.  You won’t want to miss it today!