Taxes

Club for Growth on Tim Pawlenty

Just like in 2008, the Club for Growth is putting together a series of white papers on candidates running for the Republican Party’s presidential nomination. They’ve already looked into Newt Gingrich. The next candidate to go under their microscope is Tim Pawlenty, the former Governor of Minnesota.

The Club notes that Pawlenty was strongly supportive of lower taxes as a state legislator, but that his record on that issue wasn’t entirely clean. As Governor, his record seems to be mixed; he supported maintaining some existing taxes that were supposed to expire. He also backed a corporate tax hike. However, they note that Pawlenty vetoed $7.5 billion in tax increases.

According to the report, Pawlenty did a good job in keeping spending hikes down and his support of a Balanced Budget Amendment to the Constitution. However, Pawlenty doesn’t get away with accepting stimulus funds or supporting reauthorization of SCHIP.

Pawlenty’s record on free trade and entitlements are mixed; though I should note that he just came out with a Medicare reform proposal. The Club also hit him pretty hard on regulation, noting that he supported increasing the minimum wage and cap-and-trade (a position that he has recanted).

So what’s the bottomline?:

IRS taxing donations to 503(c)(4) organizations

The United States government is bound and determined to control who says what and how when it comes to political campaigns.  After the controversial Citizens United ruling, despite the fact that there are still plenty of headaches involved in groups trying to influence elections, the Internal Revenue Service has decided to flex its muscle in putting a stop to what some feel is undue influence by some parties.

The IRS has decided to start charging tax to people who donate money to 503(c)(4) organizations.  The gift tax, which has been around for a while, actually charges a tax to the person who donates the money.  This is rather unusual because non-profit donations have often been seen as tax deductible in most cases, or at least tax neutral.  From the Wall Street Journal:

The letters are especially odd since the purpose of the gift tax has traditionally been used in coordination with the estate tax, to prevent people from avoiding the tax by divesting their wealth before they die. Contributions to 501(c)(4)s aren’t a routine death tax avoidance mechanism, and the contributions now under scrutiny are a pittance compared to overall gift tax revenues. So, hmmm, what could be the reason to start asserting the provision now, and only against a handful of high-profile political donors?

RS spokesman Michelle Eldridge said in a statement last week that the letters are the idea of career IRS employees, not the White House, and that they are part of a larger investigation of gift tax compliance. Count us skeptical that a new targeted enforcement plan, likely coordinated between at least two of the highly compartmentalized divisions of the IRS, was just cooked up by some career guys.

How many days has it been since Senate Democrats gave us a budget?

Despite not having produced a budget in over 750 days (more than two years), Senate Democrats have decided to continue to sit on their hands:

Democrats said they are close to agreement on a spending plan that would reduce borrowing by more than $4 trillion over the next decade, with about half the savings coming from higher taxes. That would offer a sharp contrast to the GOP budget, which relies entirely on deep cuts in spending.

But rather than subject a proposal for higher taxes to Republican attack, Senate Budget Committee Chairman Kent Conrad (D-N.D.) said he would “defer” action “because of the high-level bipartisan leadership negotiations that are currently underway” involving lawmakers from both parties and Vice President Biden.

“If you go through a partisan markup, it hardens people’s positions and makes it more difficult to get a bipartisan agreement,” said Conrad, a member of the Senate’s Gang of Six, which has been trying to draft its own debt-reduction framework.

“After four months in the group of six, trying to reach a bipartisan agreement is as difficult as anything I’ve ever been involved in,” Conrad said. “I want to give every chance for a bipartisan agreement to succeed.”

The decision to delay action is, of course, political. Democrats want to continue to criticize the budget passed by House Republicans, even though Senate Minority Leader Mitch McConnell (R-KY) will not try to convince his colleagues to support the proposal.

Donald Trump will not run for president

This probably comes as no surprise now that his reality show is done for the season and his future with the program was threatened, Donald Trump has decided against a presidential campaign - though he wants you to know that he would have been totally awesome:

Real estate mogul and television celebrity Donald Trump, who generated a media publicity blitz by saying he might run for president in 2012, announced Monday that he will instead remain a businessman.

“After considerable deliberation and reflection, I have decided not to pursue the office of the presidency,” Trump said in a statement.

With his typical bravado, Trump maintained that he would have won the Republican primary and the general election, but recognized that “running for public office cannot be done half-heartedly.”

“Ultimately, however, business is my greatest passion and I am not ready to leave the private sector,” Trump said in the statement.

Trump was able to harness a lot of media attention as he went on a one man crusade for President Barack Obama’s birth certificate, though that conspiracy theory had long been debunked. He was hit hard by fiscal conservatives for abuse of private property rights, supporting socialized health care, supporting higher taxes and pushing for a trade war with China.

There is little no doubt, even before he made this announcement, that he was trying to drum up publicty for his reality television show.

Who wins with Trump not running? As someone said on Twitter yesterday; America.

Why I’m a heartless bastard

I’ve been called a heartless bastard before.  It’s happened a number of times as a matter of fact.  It tends to revolve around the fact that I don’t want tax dollars to be spent on people who are to sorry to try and earn it.  For many people, that’s more than enough to saddle me with that label.  The question then becomes, why am I that way?

Let’s ignore the recent revelations about where a significant portion of our tax dollars assigned for helping the poor have actually ended up.  There’s a lot more to it than that.

You see, I’ve been dirt poor before.  I’ve been so broke people brought me groceries so I wouldn’t starve.  I was as sorry as sorry could be.  I’ll be blunt: I was a loser.  A complete and total loser.  If my wife had left me, she would have been well within her rights and I couldn’t blame her if she had.  But, luckily for me, she didn’t.

That loser path continued on until almost ten years ago.  That was the day my son was born.  I knew then that I couldn’t keep screwing up for the rest of my life.  I had to do something.  He deserved better.

Today, I’m not rich but I’m a damn sight away from poor.  Uncle Sam seems to think so anyways, based on my taxes.  I didn’t get here through some secret means.  I worked hard and did good work where I was.  Eventually, I found myself in a position where I was actually pretty fair off financially.  I’m solidly middle class at the moment, though I do have dreams of moving way on up that ladder.  It wasn’t particularly tricky either.

Nothing stopping millionaires from sending more money to DC

On Friday, Stephen Moore noted that the wealthy liberals that are often are the loudest among those calling for tax hikes don’t seem to be rushing to given their millions to the federal government:

I wish I had a dollar for every time a wealthy liberal has declared he thinks he should pay more taxes. That list includes Warren Buffett, George Soros, Bill Gates Sr., Mark Zuckerberg and even Barack Obama, who now says that not only should rich people like him pay more taxes, they want to pay more. “I believe that most wealthy Americans would agree with me,” he said of his tax-hike plan. “They want to give back to the country that’s done so much for them.”

The idea that the nation’s primary wealth and job creators—i.e., the people who carry the bulk of the tax load—aren’t doing enough for the country is a bit insulting. But the president is right that there is a seemingly endless number of terribly wealthy, guilt-ridden individuals who want Americans to pay more taxes.

So why don’t they? There is a special fund at the Treasury Department for taxpayers who want to make “gift contributions to reduce debt held by the public.” But very few do. Last year that fund and others like it raised a grand total of $300 million. That’s a decimal place on Mr. Zuckerberg’s net worth and pays for less than two hours worth of federal borrowing.

Here are seven reasons to oppose tax hikes

We’re often told by the Left that all we need to do to solve our budget shortfalls is to raise taxes. But is that really the right course? In a new video from the Center for Freedom and Prosperity, Piyali Bhattacharya (Young Americans for Liberty) gives us seven reasons to oppose higher taxes hikes. The reasons range from the fact that tax hikes encourage more spending and discourage economic growth to how they encourge loopholes in the tax code and undermind competitiveness.

Trump signs Taxpayer Protection Pledge with promise to sink economy

Donald Trump, who plans to announce his decision on a presidential bid on his TV show during the season finale (there’s a shocker), has signed the Americans for Tax Reform’s Taxpayer Protection Pledge; but there is a catch:

Billionaire developer and GOP presidential frontrunner Donald Trump has signed Americans for Tax Reform’s pledge to oppose any new taxes, according to ATR President Grover Norquist.

“I Donald J. Trump pledge to the taxpayers of the United States of America that I will oppose and veto any and all efforts to increase taxes,” the pledge reads. But Trump apparently added in his own writing “Except on China and other countries that have consistently taken advantage of our great country.”

The pledge was dated Tuesday, April 26.

What’s the point to signing the tax pledge, the purpose of which is to oppose destructive economic policies, when you’re going to support tariffs on our trading partners? That’s an absurd notion. We know how protectionism played a significant role in causing the Great Depression because of the passage of the Smoot-Hawley tariff.

Don’t get me wrong. We need to become more competitive, but you don’t do that by imposing tariffs or pushing for “fair trade” (what exactly is fair trade, anyway?). You do that by getting rid of the deregulation, reducing the tax burden and getting rid of impediments to trade (ie. tariffs).

Who’s really surprised by S&P comments?

The revelation that Standard & Poor’s was less than optimistic about the United State’s ability to pay back loans seemed to rock the nation that is gearing up for debate on raising the debt ceiling.  My question is, who is really surprised?

The more debt anyone or anything takes on, the less likely they are to pay it back.  At some point, we either stop accumulating debt or accept that we might not pay it back.  So far, the President and much of Congress don’t seem to interested in stopping the gravy train, so we’re probably going to default on something at some point if things continue this way.

I can hear some folks arguing that tax increases may do the trick.  Unfortunately, we have never had a tax revenues in excess of 21% of GDP.  Never.  To just fund Obama’s budget, we would need an estimated 23% of GDP.  Now, various tax schemes have been tried through the years.  From Reason.com and their take on the issue:

Between 1950 and now, we have had presidents and congressfolks who have tried their damnedest to jack revenue through top marginal income tax rates as high as 92 percent (and as low as 28 percent), all sorts of tariffs and levies and temporary surcharges and parking fees at National Parks and you name it. Why, we’ve even got a federal corporate tax rate so high (35 percent) compared to other OECD countries that the Obama administration wants to cut it. But none of that has worked to increase revenue anywhere near 23 percent, or even far north of 18 percent.

Another day, another shot at Trump

The Club for Growth, which has been slamming Donald Trump all week for past statist positions (supporting nationalized health care, higher taxes, limiting trade and supporting and engaging in eminent domain abuse), hit him again yesterday for backing the auto bailout:

The Club for Growth today criticized Donald Trump for saying that the federal government should back the auto industry and that “You cannot lose the auto companies.”:


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