Kirk Adams is a small businessman and supporter of SBABG’s mission.  He is running for Congress to represent Arizona’s 5th Congressional District.  We are excited to see him take on the entrenched Washington insiders.  We need more small businessmen to run for office!

His opponent, Washington insider Matt Salmon, has been attempting to reinvent himself as a small government conservative.  Adams is taking him to task (see full video below). After a decade of lobbying for energy mandates, public employee unions, and crony capitalist projects, Salmon finally moved back to Arizona (from Washington), bought a cowboy hat, and is attempting to reacquaint himself with some conservative principles (such as don’t give money to liberal candidates like Ed Pastor and Joe Baca).

Yesterday, in pursuit of his new image, lobbyist Salmon released an opinion piece condemning congressional insider trading.  He’s right, politicians should never use their positions to enrich themselves, whether it’s through insider trading while in office or through lucrative lobby…err…other careers once they leave office.

What made his piece laughable is the fact that Salmon personally donated money liberal Congressman Ed Pastor, who was featured last month in a New York Times article about–you guessed it–congressional insider trading!

“When Ed Pastor was first elected to congress two decades ago, he was comfortably ensconced in the middle class.  Mr. Pastor, a Democrat from Arizona, held $100,000 or so in savings in the mid-1990s and had a retirement pension, but like many Americans, he also owed nearly as much in loans.  Today, Mr. Pastor, a miner’s son and a former high school teacher, is a member of a not-so-exclusive club:  Capitol Hill millionaires.”

So, what gives?  The Kirk Adams for Congress campaign asked Arizona voters, “Why would a former Republican U.S. congressman, turned lobbyist, donate money to a liberal Democrat campaign.” A few answers:

“They would give money to any campaign that served their particular needs.”

“Wasn’t principled in the first place and now he’s out for the money.”

There sure is something fishy about Matt Salmon.

Here are some definitions of Big Government from a few online dictionaries.

“Government perceived as being excessively big-spending and attempting to control too many aspects of people’s lives.” MSN Encarta

“Government that seems to have too much control over people’s lives.” Macmillan

“Any government wielding excessive control over its citizens or interfering with their lives.” Dictionary.com

You see the themes – control, interference, wasteful, big-spending.

That’s true, of course, but we’d like to be a little more specific and thought-provoking in our definition.

Big Government, in its most raw form, is a group of individuals that through coercion turns human beings into either beasts of burden or perpetual children.

It is that group which preaches entitlement over responsibility, dependency over self-sufficiency.  It purports that people are incapable of caring for themselves through free and voluntary choices, and therefore must be coerced into “doing the right thing.” It prevents human beings from being fully actualized, keeps them in a form of subjection and – in its most extreme form – slavery.

Does it do this deliberately and willfully?  Not in the beginning.  Isabel Paterson, in her book The God of the Machine, said:

“Most of the harm in the world is done by good people, and not by accident, lapse, or omission. It is the result of their deliberate actions, long persevered in, which they hold to be motivated by high ideals toward virtuous ends… …[W]hen millions are slaughtered, when torture is practiced, starvation enforced, oppression made a policy, as at present over a large part of the world, and as it has often been in the past, it must be at the behest of very many good people, and even by their direct action, for what they consider a worthy object.”

Even the alleviation of suffering, so long as it is done through plundering third parties, will result in more total suffering induced than ever relieved.  The total amount of suffering in the world cannot be reduced by forcing one group of human beings to relieve it in the way the tyrant desires.  The tyrant’s coercion makes more of mankind miserable, turns them away from productive endeavors.  In its extreme forms, Big Government paradoxically kills innocents in order to save lives.

Seen in this way, Big Government can either be a Tyrant or a Nanny, or a combination of both.  Either it enslaves you and coercively makes you work on its behalf, or it “protects” you from yourself, restricting your freedom while promising to care for your every need, in exchange for your agreement to keep it in power.

Either way, it treats you as either an animal to be burdened, or a scolded child to be suckled forever at its teat.

How you are treated often depends on whether or not you are willing to keep the ruling cadre in power.  If you do, you may lose your freedom but win the privilege of being coddled.  If you don’t, you may lose your freedom and be burdened.

So Big Government divides people into two groups: one group is the animals burdened with the task of producing the mothers milk forever; the other is that group which forever – or so it’s promised – drinks the mothers milk.

Now, in pointing this out, we’re not talking about any specific group that is favored by government and eats from the labor of others, we’re talking about all such group, from bailed out banks and companies, to subsidized farmers, to protected unions, to groups that benefit from tariffs, to the ever-growing unproductive government bureaucracy; in short, any form of corporate or public dependency program.

One of the central features of Big Government is that it encourages bad behavior in order to remain in power.  It bails out those who have made bad decisions in order to gain their support.

The individuals that comprise Big Government, of course, play god, determining which group of human beings will be the beasts of burden, and which will be the bailed out, dependent children.

Over time, people learn that it does not pay to behave responsibly.  In fact, the consequences for poor judgment will be so lessened as to have no moral authority over behavior.  People learn that they can live life however irresponsibly they want and some one else will be forced to pick up the tab … that is, until there’s no one left with any money or productive resources.

At that point, the system collapses soviet-style.  The beasts of burden decide that it’s easier to be suckled infants and then there are no longer enough producers to support the dependents.

One interesting phenomenon that we have noticed over the past decades is how Americans have behaved regarding debt and savings, and how the past decisions they made are now affecting them.

Look at what has happened in the U.S. over the last few decades.

This first graph shows the U.S. Savings rate (what percentage of their incomes Americans saved) over the past 50 years.

Notice that, for whatever reason, over the last 30 years people have been putting less and less money away for a rainy day.

Now, look at this graph of household debt as a percentage of disposable income over the last 30 years.

Despite saving less money, people are using more borrowed money to support their lifestyles, especially over the last decade.

Low savings rate + high and increasing debt load = people living beyond their means

At some point, the gig is up.

Now, look at this graph of the number of food stamp recipients over the last decade.  In the decades prior to 2000, the number of food-stamp recipients had been trending down.

So here’s the questions:

Are these events merely correlated or is there an element of causation?  That is, do government bailout promises encourage people to not take responsibility for their own lives, to prepare for “unforeseen” – yet predictable – misfortunes in the future?

Understand that we’re not arguing for or against this particular social program, just merely asking questions about whether or not Government Dependency Programs create Moral Hazard.

What do you think?  Do government handout programs enable bad behavior?

Does the knowledge that someone will be there to give you food, coupled with the knowledge that the government has the capacity to forever force someone else to pay for your livelihood, make you take less responsibility for your own well being, live on borrowed money, not save for a rainy day?

By asking these questions, of course we’re not advocating for letting the hungry starve.  We advocate for the support of voluntary charities, and lots of it, and we believe that each of us has a personal responsibility to responsibly care for the poor among us in ways that do not create dependency and thereby rob recipients of their dignity.

If you reward bad behavior, you’ll get more of it.  If you punish responsible behavior, you’ll get less of it.

Big Government must be opposed.  If we don’t oppose it immediately, over time in its most extreme forms it reduces people to animals or infants.

As Cato’s Letter #38 taught:

“What is government, but a trust … which ought to be bounded with many and strong restraints, because power renders men wanton, insolent to others, and fond of themselves.”

So what can you do? 

Sign up for our RSS feed and become a fan of our Facebook Page. We’ll continually send you information about how you can help keep government in its place.

Then, Join DownsizeDC.org and participate in it’s campaigns.  It takes less than five minutes per day, and you just participate in the campaigns you like.  In our opinion, it is the best project around for reducing the size and scope of Big Government.

originally published May 21, 2010.

On one hand, the whole notion of earmarks and pork barrel spending encourages many impractical pet projects from doofy legislators. To see their ban would send a message to the fiscally irresponsible politicians, on both sides of the aisle, who misuse (our) federal tax dollars. On the other hand,eliminating 100 percent of earmarks in fiscal 2010 would have cut the federal budget by less than one-half of one percent.  In other words, earmarks are close to the least of our worries.

She’s actually mistaken, and she’s making a common mistake because she doesn’t understand the role earmarks play in the legislative process.  They are a lever whose spending impact is far greater than what they appear to be.

Look at this issue from another angle.  For just .5% of government spending, why is there such resistance from Congressional Leadership (on both sides of the aisle) against getting rid of them?  That’s the question to ask.  Once you ask it and look closely, you see why.

Earmarks are an effective tool to manipulate Congressional voting blocks.

Take “Legislation A” that does not stand-alone well and cannot muster majority support.

Then take “Project B” that a single legislator wants in his district.  It favors one group of people (say, a state or city) at the expense of all others.  As a stand-alone project B could never pass legislatively if introduced alone.

You’d think that because the legislation and the project don’t stand well on their own that combining them would also result in something that doesn’t stand alone well.

You’d be wrong.

What if I told you that the way Congress does business now often leads to Legislation A passing while (and because) it includes project B?

It happens all the time and earmarks are what makes it possible.

Congressional Leadership can pass legislation that otherwise could not garner a majority if they will throw in pet projects (in the form of earmarks) to buy votes.  See, they are giving a bribe to a legislator so that the legislator can go back home and tout the fact that his district got project B funded and put in place (a targeted benefit) while refusing to call attention to the bad legislation they passed (a dispersed cost).

When costs are dispersed but benefits targeted, that’s where corruption and vote buying will most emerge and where special interests most come to play.

So – because of earmarks – you end up with the combination of bad legislation that includes bad and wasteful projects.

Votes are bought through earmarking grants.

It’s like logrolling, but unlike traditional logrolling, it’s a crack-cocaine version …

Without earmarks big, bad, costly legislation is less able to be forced through.

Get rid of earmarking, and you get rid of the “lever” through which some of our worst legislation has been passed.

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They think they’ve found a way.  And we need to stop them.

They have hit on this idea of trying to reclassify the Internet as a public utility.  Why?  Because if they do, it gives this government agency the authority to regulate and take over the Internet.

No Joke.  Read all about it in this American’s for Prosperity Piece.

You need to get on the phone RIGHT NOW and let your Congressional Representatives that you know what is going on and that you expect them to block this … or else.

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Be proud, small-business owners! You’re now the most trusted group in America. Listen up, federal government! You’re neglecting small business — and most people think so.

According to the just-released study by the highly respected Pew Research Center, small business is the most trusted institution in America. More than churches. More than colleges. More than technology companies. And certainly more than labor unions or large corporations.

However, that little part of the federal government neglecting us . . . we can take care of ourselves, thanks.  Just stop giving away our money to your corporate cronies, your dirty banksters, your union thugs and your GSEs.  And get out of our way.

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Tim Carney’s book Obamanomics does a great job spelling out how and why. We highly recommend this book to you.  Carney also spoke on a Cato panel about his findings. The video of his speech is at fora.tv – definitely worth the watch.

If you think that the current Goldman Sachs SEC probe is a sign of Big Government taking on Big Business, then I’ve got some beachfront land in Iowa to sell you.  Goldman will get a “slap on the wrist” (if anything at all, since it looks like the charges are extremely overblown and may be without merit) while – wink wink – the resulting financial regulation encouraged by their public castigation will ensure that the new and onerous compliance costs hurt Goldman’s smaller competitors.

Big Government gets more power, Big Business gets less competition from smaller competitors.

It’s a familiar story.  Watch it unfold, yet again, in the coming months and years.

Read that Carney book.  Free your mind.

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There were many lessons learned (not least of which that there’s no such thing as a “pro-life” Democrat, Harry Reid and Bart Stupak taught us this), but this is what we learned most:

In the battle for the hearts and minds of Americans, we won.  When this vote was finally taken, only 35% of American’s wanted it.  One in five Democrats voted against it.

And we defeated the “public option” and that was the most vital part of the battle.  In the end, what these so-called progressives got was a massive handout to insurance companies and a crazy plan based on the already-failing Romney-care in Massachusetts whose entire substance is pointing a gun at people and demanding that they buy insurance.  (By the way, don’t forget in 2012 that Romney was no friend on this health-debate, even penning an op-ed in USA today advocating for a plan very similar to the one just passed.)

The way forward will be multi-faceted, but never forget, in the battle for the hearts and minds of America, we defeated them.  Unfortunately, their power and corruption were too much to overcome, this round.

Make no mistake, overcoming this will be very difficult – but keep in mind that NJ and VA kicked out their Democrat Governers, Ted Kennedy’s seat was lost to a person whose primary platform was anti-healthcare, and the Democrats who voted for this are headed for a slaughter in 2010.

What we have going for us right now is that the full program does not take effect for four years.  In that time, this legislation will be bombarded and attacked non-stop.

The place that this legislation will be best challenged is not in the federal executive and legislative branches (at least not initially).  It will be challenged in court on constitutional grounds (where our case is very strong), and it will be challenged by the states themselves (particularly by pissed-off Attorneys General who may just have the numbers to push a constitutional convention if necessary – it’s more possible than you think since this Bill assuredly bankrupts states which are already on the verge of insovency).

Do not lose hope.  The fight was worth it.  The momentum is still with us, and these Democrats will rue this day which will live in infamy.

Cry your tears tonight if you must, but get some good sleep and let your heart be at peace – then wake up tomorrow and sharpen your knives.  We’re going right back at them.

The Senate health care bill crucial to saving President Obama’s signature domestic initiative will hit the wallets of a quarter of all Americans making less than $200,000 per year, according to an analysis by the nonpartisan Joint Tax Committee that assessed the way the bill would hit taxpayers directly through new taxes and fees and indirectly through taxes levied on health care providers and passed on to consumers.

The committee also determined that the bill would subsidized insurance premiums for 7 percent of taxpayers — about 13 million people — while some 73 million people would face higher costs from the new fees and taxes.

“For every family that gets some benefit from this program, in other words, a premium subsidy, three families are going to get a tax increase and those three families obviously include the bulk of people you’d call middle class America,” Sen. Chuck Grassley, R-Iowa, told Fox News.

Watch the words directly from the Dissembler-in-Chief’s mouth.

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How can the president claim such things?

Well, he can’t.

That is, not if he knows how to do math (or tell the truth).

The big problem is that all of his claims count 10 years of taxes but only 6 years of spending.

Paul Ryan, in last week’s health care summit, exposed this lie (and others) by doing the math for the president.  He pointed out that the real cost over ten years is $2.3 trillion – and even that is on the “low” side since lots of people will want the “now-free” health care and lots of businesses will drop coverage.

The President claimed that costs are $100 billion per year, but he’s not telling the truth (or can he just not do math?).  The truth is that costs increase each year.  And bringing down the deficit?  No, it won’t.  Deficits are going to be at least $460 billion over the first 10 years.  The ten after that?  $1.4 trillion.

Watch Paul Ryan take the president to Math (and Truth) school.

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(Scroll down for the URGENT ACTION ITEMS.)

US News & World Report is reporting that Democratic Leaders are planning secret health reform deliberations.

Despite their claims to the contrary, the way that House Speaker Nancy Pelosi and Senate Majority Leader Harry Reid have handled the healthcare bill has been anything but transparent. And, if the left-wing blogosphere is to be believed, the two congressional leaders intend to keep the deliberations secret as they try to merge the House and Senate versions of the legislation into something that will pass both chambers.

C-SPAN has challenged the President and Congress to open Health Care talks to TV coverage, writing:

President Obama, Senate and House leaders, many of your rank-and-file members, and the nation’s editorial pages have all talked about the value of transparent discussions on reforming the nation’s health care system,” he wrote. “Now that the process moves to the critical stage of reconciliation between the chambers, we respectfully request that you allow the public full access, through television, to legislation that will affect the lives of every single American.

And then C-SPAN reminded the president that he “pledged during the campaign to open up health care talks to C-SPAN’s cameras”.  In fact, what Obama said was:

That’s what I will do in bringing all parties together, not negotiating behind closed doors, but bringing all parties together, and broadcasting those negotiations on C-SPAN so that the American people can see what the choices are.

Today Pelosi responded to C-SPAN’s request that the reconciliation process not be hidden from the American People.  Her reply?

There has never been a more open process for any legislation.

Quite a bold statement.  Never.  Never, ever has any other bill had a more open process than this one that has been totally conducted behind closed doors.  She must have sensed the absurdity of her statement because she then added

We will do what is necessary to pass the bill.

That’s more like it.  A little truth, finally.  And if what is necessary means dissembling, hiding, breaking campaign promises, and shutting out the public, then she’s willing to do it.

We don’t have to stand for it.

Step one is to let everyone we know that this is going on.  If we can inform enough people that this is going on, we can encourage a groundswell of opposition and force the legislative process into the open.  Remember, it was President Obama who promised transparency and televised broadcasts on C-SPAN, and we are demanding that he and they keep this promise.

What can you do?

URGENT ACTION ITEMS:

1. Please go right now and join the Facebook group “We Demand Congress Televise All Health Care Legislation Deliberations” (just click on the link) and then invite all of your Facebook friends to join, too.

2. Then sign the petition at Letthecamerasin.com and encourage your friends to do likewise!

You can also forward this blog post along to them.

If we can get this information to spread quickly, we can force their hand.  But we must act quickly and decisively!

Judas got 30 pieces of silver. Esau got a mess of pottage. Benedict Arnold offered to sell out his countrymen for cash. And now joining the long line of the imbecile pansy squishes is Big Ben Nelson. And for what did he sell his soul? Medicaid subsidies for Nebraska … all paid for by the other states he just foisted this monstrosity upon.

This one is making the rounds, forward it along to all Nebraskans you know.  They must be so proud right now!

Not only was it not bi-partisan, it wasn’t even close to unanimous within the Democratic Party.

Divisive.

Toxic.

Political Suicide.

Nearly 20% of House Democrats refused to stand with Pelosi and Obama.

Or did Pelosi and Obama refuse to stand with their party?

Simply. Amazing.

If you want to know what’s in the 2,000 page bill, and just how it will affect your small business, read this.

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But recently, UPS has declared war on FedEx, in the form of Union-Driven rent seeking and the outcome of the war will likely affect small business owners and employees.

Lakers vs. Celtics, Red Sox vs. Yankess, UPS vs. FedEx.  Rivalries are good, and in the case of the latter two package delivery companies, a strong rivalry results in better prices, improved innovation, and improved choices, particularly for small businesses.

But Congress is trying to mess with that by “leveling the playing field” through a small provision tucked into the FAA Reauthorization Act of 2009.  The Act, which made it through the house is now in front of the Senate, and essentially changes the rules on labor organization for express package carriers. (See Section 806)

The bill’s sponsor is Minnesota Representative James Oberstar, chairman of the House Transportation and Infrastructure Committee, and co-sponsored by Jerry Costello, from Illinois.  Both of these congressmen receive a large percentage of their campaign contributions from Union organizations, and both have been the recipient of steady generous campaign contributions from UPS and the Teamsters Union (which represents UPS workers).

At issue is this:  FedEx Express (which carries only the overnight and express packages) workforce is governed under the Railway Labor Act, which requires a national vote of employees in order to form a Union.   UPS, on the other hand, is governed under the National Labor Relations Act, which allows for unions to form on a local level.  UPS and its Teamsters Union admit that the fact that FedEx’s workers are not unionized is a “competitive advantage.”  They have therefore used their political clout to get Mr. Oberstar and Mr. Costello to pork-barrel in legislation that would put FedEx Express under the NLRA, and make it possible for local union organization.

Why should you care?

1. This will drive up the cost to run your small business.  If FedEx workers were to organize, it would assuredly result in a higher cost of business for them. Those additional costs would then be passed on to businesses and consumers that use FedEx.  Even if you use UPS, your costs would go up, because as FedEx raises it’s prices, UPS would not be forced to keep prices down to remain competitive.  Thus resulting in higher overall transportation costs for everyone.
2. The federal government should not be involved in “leveling the playing field.”  Many small and large businesses in all industries take advantage of competitive positions, through legal loopholes, legislative action, or through strategic partnerships.  If FedEx has found a legal way to have an advantage over a competitor, why should that be taken away?
3. There are only 2 small package delivery companies in the country (if you don’t count the Post Office (and we don’t)). Taking away competitive advantages results in identical companies, thus creating a duopoly.  With no competitive differences, there would be no incentive for either company to work harder for your business, thus resulting in higher prices, and lower service for small businesses that ship goods.
4. Do you remember when the Teamsters Union chose to strike in 1997?  If you owned a business then, I guarantee you remember. Small businesses were the ones that suffered the most.  If passed, we could conceivably end up with both FedEx and UPS workers going on strike at the same time.  What would that do for your business?
5. Organizing as a Union will do nothing for the average FedEx worker.  The next time you shop at a grocery store, ask the clerk at the counter what he gets from being a member of his local Grocery Workers Union.  Or ask your favorite teacher if she is confident that the local Teacher’s Union has successfully secured her a competitive salary.  The UAW is just as much at fault for the failing US auto industry as is poor management. Unions do nothing for average workers except take a piece of their paychecks, and gift an occasional hat or commemorative pin.

In reality, Unions are a thing of the past.  They may have been a necessary part of the development of our laws.  But in today’s economy, they essentially create no net gain for their members and are merely a self serving political entity.  As Veronique de Rugy puts it:

Unions represent an Industrial Revolution–era understanding of labor relations. The modern American movement grew out of an assembly line culture where every product was identical and workers were viewed in a similar way. As that mode of production has declined, so have unions’ relevance and power. 

Call or write your Senator today.  Tell them to stay out of business, and to vote no on the H.R. 915 -FAA Reauthorization Act of 2009.  Click here for a quick and easy email submission tool.

Sign up for our RSS feed and become a fan of our Facebook Page and we’ll keep you aware of how Big Business and Unions collude with Big Government to punish free markets and prosperity.

You dirty rat.

Chicago and Cook County residents aren’t the only ones about to get shocking tax news; the city is debuting a “tax whistle-blower” plan that could turn neighbor against neighbor in Chicago’s business community.

The folks at city hall will pay cash bounties to informants who turn in business tax cheats around the city. The reward would amount to some sort of percentage of the tax money that the city recovers.

“It’s just another way of bringing people into compliance,” Revenue Department spokesman Ed Walsh told the Sun-Times.

“It would probably be … a business knowing that a competitor is not remitting a tax. An employee [of the tax-dodging business] could know that, too. Typically, you need to provide some type of incentive.”

If you think this sounds like a good idea, you are dead wrong.

This program isn’t about “reporting a crime” which is what we all ought to do when we see a crime committed.  The point is that it gives people A SHARE OF THE MONEY THEY HELP CONFISCATE!

Chicago is turning civilian spying into a state-backed business.

Whatever your feelings about the criminality/non-criminality of tax evasion (conscientious objection, etc), this program doesn’t have anything to do with citizenship and crime reporting. It is state-backed and rather than dissuade “bad behavior” actually encourages it.

Look at the procedure and then the incentive systems.

Amateur film released on the Internet rocked the organizations and threatened their existence. 

The way each organization handled its respective crisis exposed a lot about the nature and character of the people who manage the organizations and helps us understand that, yes, ACORN deserves to disappear and have its executives investigated.

President Obama’s ties to ACORN should also be revisited and investigated, as should those of his current Political Affairs Director, who prior to joining the Administration worked for ACORN.

Domino’s problem video showed employees doing disgusting things to food that was to be served to customers.

ACORN’s problem videos were of a far more serious nature – ACORN employees aiding, abetting, and encouraging serious felony criminal behavior, including counseling people who came to them on how to smuggle underage illegal-immigrant girls into the U.S. to be employed as sex workers and then launder the funds (tax free!) that came from the work.

Both organizations faced an existential threat over the release and viral spread of these amateur videos.

To get an idea about the leadership character of both organizations, we can to look to what each did when the videos were released.

Domino’s expressed outrage at the employees’ behavior and immediately issue a public apology to customers.

ACORN expressed defiance and outrage at the filmmakers and said the films were doctored.  When additional films came out disproving this and made clear a pattern of corruption in ACORN’s offices nationwide, only then did ACORN leaders express outrage at employee behavior; yet they still refused to issue an apology or open the organizations records to show that the problems were isolated incidents in order to put to rest the suspicion that the corruption is systemic.

How did each organization deal with the employees implicated in the videos?

Domino’s filed a criminal complaint and pursued felony charges against the employees.

ACORN said that they “terminated” their problem employees but really just suspended them without pay, and then sued the filmmakers and threatened to sue news organizations that showed the videos!

Any principled and non-corrupt CEO would be sickened to discover such behavior from her employees, but feel grateful to find out this information and put an end to it.

But ACORN’s CEO, Bertha Lewis, does not appear to be embracing this role.  She initially stated blatant untruths about the films and refused to take ownership of the exposed corruption.  Once the evidence continued to roll out and was undeniable,  she acted like a concerned CEO and even went so far as to thank the filmmakers for exposing the corruption; but then moments later she threatened to sue the filmmakers for having uncovered the corruption! It might be funny if it weren’t true. What an unbelievable contradiction.

Bertha Lewis heads up a serially corrupt organization. She presides over an organization that is rotten to the core.  In the real world, she’d have been let go long before now, but she’s still there, and that further scandalizes the organization.

No wonder ACORN public perception is in the toilet.

Bertha Lewis needs to be questions about how much criminal activity she may have been aware of at ACORN – she’s a 16 year veteran of the organization and has worked there in many capacities and levels.  It’s not just these videos only that have occurred during her tenure, but many other scandals she has presided over.

She has presided over documented voter registration fraud. In fact, just last month ACORN suffered yet another blow when a former ACORN employee, a director of the Las Vegas office, agreed to testify about ACORN’s voter fraud in that state.

It is now dawning on people that ACORN may have thrown the Minnesota Senate Race, which resulted in the election of Al Franken to the Senate by a mere 312 votes.  Mickey Kaus surmised:

“ACORN claimed to have registered 48,000 new Minnesota voters. If just 1% were ineligible but cast ballots, or had ballots cast for them illegally, and survived the recount process … that’s 480 votes, almost certainly overwhelmingly cast for Franken.”

In addition to serially encouraging felony behavior and engaging in rampant voter-registration fraud, ACORN also shakes down businesses and engages in tax-cheating.

ACORN is a criminal organization, engaging in systematic and repeated organized crime.  It is, along with its sister organization SEIU, part of a Mafia-like structure that preys upon the poor and extorts money from the productive.

Perhaps the greatest outrage of all is that your president has long ties to ACORN over nearly two decades.

President Obama trained ACORN activists, worked as an attorney for ACORN, and also funded ACORN activities.

Of the recent controversies with ACORN, Obama said:

“Frankly, it’s not really something I’ve followed closely. I didn’t even know that ACORN was getting a whole lot of federal money.”

Really?  The man who over two decades worked with them, distributed money to them and worked as their attorney didn’t know they were getting a lot of federal money?

In 2007, Obama spoke to ACORN leaders and said:

“I’ve been fighting alongside of ACORN on issues you care about my entire career. Even before I was an elected official, when I ran Project Vote in Illinois, ACORN was smack dab in the middle of it, and we appreciate your work.“

And not only that, Bertha Lewis’s former political director in New York, Patrick Gaspard, is now the Obama White House Political Affairs Director.  By way of Gaspard, there’s a direct line of communication between the ACORN CEO and President Obama.

It gets worse.  The Obama campaign actually paid money to ACORN to get out the vote for Obama, and then misrepresented it on their financial statements.

The Wall Street Journal reported that:

“The Obama campaign also gave Citizens Consulting, Inc., an ACORN subsidiary, $832,000 for get-out-the-vote activities in key primary states. In filings with the Federal Election Commission, the Obama campaign listed the payments as “staging, sound, lighting,” only correcting the filings after the Pittsburgh Tribune-Review revealed their true nature.”

Will our President and his team keep putting money into ACORN’s pocket and then obscure it in their financial statements?

ACORN is losing federal taxpayer funding (can you believe you were funding this racket?) and corporate backing, but more needs to be done to remove this blight and cancer from the American landscape forever.

Call your Representatives and express your feeling that ACORN should never again receive any taxpayer funding and that you want them to be criminally investigated by Congress.

Let them know that as a taxpayer you are outraged at what they’ve done with your taxpayer money and you want to see justice done.

And then let them know you want the Obama Administration’s ties to ACORN investigated.

Consider holding a rally near your local ACORN office and inviting the press to cover your rally, demanding that ACORN be investigated and prosecuted by your local government.  Make sure to obtain permits as necessary.

Investigate your elected officials for their ties to ACORN and, if they are found, disseminate that information and mount a pressure campaign to require your representatives to publicly denounce ACORN.

Please share this information with others. If enough Americans understand ACORN’s corruption and the Obama Administration’s ties to it, it could help slow his Big Government agenda, and defeating Big Government is what SBABG is all about.

Sign up for our RSS feed and become a fan of our Facebook Page. We’ll keep you updated about how Big Government and its corrupt partners work to destroy the rule of law and what you can do to combat them.

To understand why this is, you need only understand the Broken Window Fallacy.

Frederic Bastiat originally formulated the Broken Window Fallacy in his landmark book That Which is Seen and That Which is Not Seen.  Henry Hazlitt then expounded and reformulated it for a more modern audience in his classic work, Economics in One Lesson (which was one of our 31 top resources for small business owners and employees).  In Chapter 2, entitled “The Broken Window,” Hazlitt wrote:

The Fallacy of the Broken Window exposes the lie that, as one Austrian Economist put it, “the … destruction of wealth fuels its creation.”   He then goes on to summarize the Fallacy and concludes:

You can see the absurdity of the position … when you take it to absurd extremes. If the broken window really produces wealth, why not break all windows up and down the whole city block? Indeed, why not break doors and walls? Why not tear down all houses so that they can be rebuilt? Why not bomb whole cities so construction firms can get busy rebuilding?

It is not a good thing to destroy wealth. Bastiat puts it this way: “Society loses the value of things which are uselessly destroyed.”

But Big Government frequently peppers hammers us with the message that we must create new wealth by destroying old wealth!

And that’s where Cars For Clunkers comes in.  Here’s a quick summary of the program and where it goes wrong.

1. The Federal Government takes tax-dollars, or borrowed dollars (to be paid back later through taxes), and offers to hand that money to people who will trade in pre-selected older cars; the money is to be used toward buying a new car; then the government takes the traded-in car off the road, and junks it, often by destroying the engine; the “subsidy” given toward buying the new car (for each trade-in) is $3,500-4,500
2. If the value of the trade-in car is less than the $3,500-4,500 handed in trade value the government has overpaid for the car, despite that the government is about to junk it, thus ensuring that no value will be received in return.
3. If the value of the trade-in car is more than the $3,500-4,500 handed, the government still derives no value from the trade because it’s not reselling it; it’s junking it and stripping it for salvageable parts (which are minimal)
4. The net number of cars on the road remains the same; maybe net emissions drop or maybe fuel-usage drops (because of better fuel efficiency) in the aggregate, but maybe not! (more on that below)

So, in this new version of the Broken Window Fallacy, our modern-day Window Breakers are destroying drivable cars, then handing out confiscated or borrowed money to the people who are allowing their “windows cars to be broken” because other people are paying for these windows cars to be replaced with newer, better, sexier models!

They do this in the name of saving the environment from pollution, or saving on “waste” through fuel-efficiency, or preventing global-warming through reducing emissions, or whatever.  It really doesn’t matter what justification they’re using, it’s wrong on several levels.

It destroys wealth by not letting these cars be used up over their useful life.  It destroys wealth by routing scarce resources into activities – in this case, car building – that wouldn’t otherwise take place, denying other industries access to those resources.  It destroys wealth by taking on liabilities, through borrowing, that have to be paid back later by taxpayers (reducing their purchasing power in the future) or by taxing them immediately (reducing their purchasing power today).

Also, building the new cars emits all kinds things into the atmosphere and gobbles up energy in the production process!   So any gains in emission and efficiency are offset by that, too!

Guess what else proponents of this destruction are missing?

They are oblivious to how the incentives will change future behavior.

These people traded in a car they’ve been likely to drive less.  We can safely assume these cars didn’t get as good gas mileage or were older, “clunkers”, because they were targeted for these reasons.  These cars also may not have been driven at all, or driven rarely.  However, they’ve been used to help people get a vehicle that they’re now more likely to drive more frequently!!!  More driving means more emissions, even if the emission per unit of travel is less.  More driving means more fuel consumption, even if the fuel consumption per unit of travel is less.

See, when you change the incentives, you change the behavior.  The people who owned these traded in cars were incentivized to drive them less by having to pay more for a unit of travel, and by having to conserve the remaining life in the car, which may have been approaching the end of its life over the next 5-10 years.  Now?  Not so much.

In fact, the New York Times reports, “Michael Gerrard, director of Columbia Law School’s Center for Climate Change Law, said in a statement that the cash-for-clunker program is not a cost-effective way to reduce fuel use or greenhouse gas emissions. Any energy savings, he said, could take several years to realize, considering the time it takes the fuel savings from a new car to exceed the energy cost used to make it.

Who are the favored parties?

The subsidized consumers, of course.  But also the favored industries, who have had their goods favored at the expense of other industries.  The government isn’t handing out money to go buy [fill in the blank], yet they’re siphoning off money and resources from a finite supply and putting it into one area, at the expense of other areas.

Think the Auto-Dealers liked it?

Look at this:

Of course!  The “government” should put more money into it.  Let me fix that quote to show you what it should say if it were telling the truth.

Who were the losers?

Everyone else, especially the taxpayers.  And other businesses and industries, especially ones directly impacted by trading these cars in instead of servicing them, auto-parts sellers, mechanics, etc.

The funny thing is that down the road even the dealers will suffer, because this program created false demand and just kicked the can down the road so that the dealers could put off their day-of-reckoning a little longer.

Want to feel some outrage?

Read this story and watch the video, especially watch the video at the 2 minute mark on where they discuss how the cars are junked, and how otherwise re-saleable parts are destroyed in the process.  Perfectly usable cars being destroyed!  And, as an added bonus, Big Government makes a complete mess in administering the program (but don’t worry, they’ll run nationalized health care flawlessly).

We’re not being fooled.  The majority of American people understand that this program is corrupt and just 35 in 100 Americans are in favor of it.

But since we’re living in the age of Big Government, so let’s go all the way with this!

Why stop at cars?  In fact, the Wall Street Journal today asked, Why not a “Cash for Everything” program?

Let’s blow up buildings and rebuild them with subsidies to stimulate commercial building.  Let’s burn down homes and rebuild them with taxpayer funds to stimulate the homebuilding industry!  Let’s break up all our fine-china and buy everyone a new set!

Or maybe not.

Let’s just point out one last thing about the way Cash For Clunkers was run, and how it exposes Big Government hypocrisy.

Very poor people, the car-less among us, who don’t have any private transportation of their own, and who Big Government always profess to help, could have really used those cars.  They could’ve been given to people in need.

This summer I donated my “clunker” to the Kars 4 Kids charity, which then sold it and used the money to help poor children.  I’ll bet you my shiniest nickle that this government program has caused material hurt to charities like Kars 4 Kids.  And not just this year, but also in future years since many cars that may have been later donated to charity had their end-life pushed up to the present day and therefore won’t be available for donation in the future.

Just another sad instance of the Bastiat’s “unseens” or, in words we like to use, “what-might-have-beens.”

The program should probably be called “Cash From Clunkers” since this bunch of Big Government phonies are possessed of such little brain-power that they can only themselves be referred to as Clunkers.  Then again, referring to it as “Cash From Clunkers” also obscures the fact that though they are delivering the money, it’s not their money.  It’s our money.  Or China’s money that they’ve borrowed and we will have to pay back someday.

Anyone suspect that this whole program might just be one ruse to prop up Government Run Motors or as a payback to the Automobile Unions?

Whatever.  It’s corrupt.  Another example – in a long and growing list – of corruption and Big Government going together.

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UPDATES -  Below by Date – how did our predictions go relative to what really happened?  Read the results and decide for yourself.  (N0, we’re not prophets, we just have common sense and an understanding of basic human behavior, mysterious commodities that appear to be absent in politicians.)

UPDATE: October 4, 2009 – Cash for Clunkers Fails to Help Economy and Environment

Last week U.S. automakers reported that new car sales for September, the first month since the clunker program expired, sank by 25% from a year earlier. Sales at GM and Chrysler fell by 45% and 42%, respectively. Ford was down about 5%. Some 700,000 cars were sold in the summer under the program as buyers received up to $4,500 to buy a new car they would probably have purchased anyway, so all the program seems to have done is steal those sales from the future. Exactly as critics predicted.

Cash for clunkers had two objectives: help the environment by increasing fuel efficiency, and boost car sales to help Detroit and the economy. It achieved neither. According to Hudson Institute economist Irwin Stelzer, at best “the reduction in gasoline consumption will cut our oil consumption by 0.2 percent per year, or less than a single day’s gasoline use.” Burton Abrams and George Parsons of the University of Delaware added up the total benefits from reduced gas consumption, environmental improvements and the benefit to car buyers and companies, minus the overall cost of cash for clunkers, and found a net cost of roughly $2,000 per vehicle. Rather than stimulating the economy, the program made the nation as a whole $1.4 billion poorer.

UPDATE: October 23, 2009 – Dealers say Cash for Clunkers has made cheap, used vehicles harder to find

In his 20 years in the business, salesman Mark Sauer has never had a tougher time finding inexpensive used cars.

“It’s never been this bad,” said Sauer, buyer and sales manager of Vaccaro’s Auto Buyers of Reading, 805 Hiesters Lane.

“Customers used to be able to find a good car for their son or daughter to take to college for $2,000 or $3,000, but now that same car may cost $5,000,” Tabakelis said. “It’s sad.”

He, too, blames cash for clunkers, which has led to fewer vehicles being available at used-car auctions, and the recession.

“You used to be able to find a decent car for $2,500, and you can’t anymore, especially in the past two months,” said Arie Garcia, the association’s office manager.

Another problem is that used-vehicle prices have quickly risen above their book values, making it tougher for customers to secure financing, Garcia said.

“Cash for clunkers really hurt the used-car industry,” she said. “I think it hurt more people than it helped.”

UPDATE: October 29, 2009 – Taxpayers paid $24,000 per car

The Cash for Clunkers program gave car buyers rebates of up to $4,500 if they traded in less fuel-efficient vehicles for new vehicles that met certain fuel economy requirements. A total of $3 billion was allotted for those rebates.

The average rebate was $4,000. But the overwhelming majority of sales would have taken place anyway at some time in the last half of 2009, according to Edmunds.com. That means the government ended up spending about $24,000 each for those 125,000 additional vehicle sales.

UPDATE: October 29, 2009 – Cash for Clunkers Massively Distorted GDP

If anyone mentions the just-released 3.5% U.S. third quarter GDP growth, just throw this chart in their face. Cash for Clunkers clearly distorted the U.S. economic figures in an unsustainable fashion.

Next quarter, we won’t just be returning to business as usual for auto output. Don’t forget that Cash for Clunkers pulled future auto demand, ie. some of Q4 demand, into Q3. Thus Q4 is likely to be very weak since many people who planned to buy a car in Q4 probably took advantage of Clunkers and bought in Q3.

Next quarter, not only are we unlikely to get Q3’s boost, but motor vehicle output data could subtract from GDP as well. So watch out for the cliff…

UPDATE: March 23, 2010 – Car Sales ($millions) Reported by Dealers

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The Wall Street Journal published a piece yesterday that ties this corruption in NJ to the cankering influence of Big Government programs and policies and also highlights the malaise the state is suffering as its Big Government programs make war on Small Businesses.

It’s worth the read, and is a case study on where the country is headed.  We already have a pretty good case study in California where 7% of the US population lives, yet where 32% of Welfare recipients reside and where the Big Government there has squandered all prosperity it once had.

Read the article for the details of the whole sordid case study.  Here are the key conclusions:

Big Government is why New Jersey created only 6,800 private sector jobs from 2000 to 2007—while public sector jobs grew by more than 55,800. Big Government is the reason New Jersey ranks as the worst of 50 states on the Small Business Survival Index. And Big Government is a leading reason New Jersey has a “corruption problem” that an FBI agent at Friday’s press conference characterized as “one of the worst, if not the worst, in the nation.”

Sandy McClure, co-author of the book “The Soprano State: New Jersey’s Culture of Corruption,” agrees that big government is a big reason behind the state’s corruption problem. “You have all these little authorities that everyone has to go to for permission,” she says. “Too much government means too many opportunities for officials looking to cash in. And there’s no way that the press can keep track of it all.”

Ms. McClure is right: The more extensive government’s reach, the more opportunities the governing class has to steal from and shake down the productive class …

…The point is that politicians and officials have more to sell in an environment of high taxes, big spending and overregulation—the same things that help explain New Jersey’s anemic economic growth and job creation. When government gets too big and complicated for businesses to get their permits and approvals and funding honestly, the dishonest prosper. And the honest get fed up and flee.”

Big Government fails everywhere it is tried.  Where does your state rank on the Small Business Survival Index?  Any correlation you’d notice with Big Government’s influence?

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