Tag Archives: government

Freedom, Competition, and Education

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It seems that Georgia wants to improve its educational system, but those wedded to the status quo like the way things are and are trying to block the improvement.

Under current law, local school boards have veto authority over whether charter schools could be licensed in their districts.  That’s like letting existing neighborhood grocery stores decide whether or not a new grocer could set up business in their neighborhood.  Predictably, the school boards routinely rejected charter school applications.  In response, the state created the Georgia Charter Schools Commission, and that body began approving charter schools over the local boards’ objections.  The state’s Supreme Court ruled that illegal, and in turn, the state legislature now is debating an amendment to the state’s Constitution that would allow the state to create its own K-12 system, parallel to the local systems, and using the same pool of Georgia taxpayer funds that the public school systems use.  This will be, essentially, the GCSC process written into the state’s constitution, if the amendment gets through the legislature and onto the November ballot, and then is voted up by the Georgia voters.

The Professional Association of Georgia Educators objects to this.  Tim Callahan, PAGE’s Director of PR, Membership & Publications, had this to say:

The Georgia Constitution says local boards control where local dollars go, so if a charter school only gets state approval and not local approval, no way can they receive local funds.  They can only receive state funds.  The people who are putting this constitutional amendment on the ballot are trying to do that in our Senate right now—are really trying to do a run-around the Supreme Court ruling.

Let me see if I understand this argument: a constitutional amendment, which by its nature addresses the state Supreme Court’s concerns, is a run-around of the State Supreme Court.  Have I about got his argument surrounded?  How, exactly, does this represent a run-around?

State Congressman Ed Lindsey (R, ATL) offers this response:

Charter schools are part of an overall tool in the tool box for education reform.  It, along with the myriad of other programs, is extremely important in terms of giving parents and students a greater choice in what is the best education for a particular child, and it encourages education achievement and success along the way.  It creates innovation.

It’s come down to this, as Lindsey also points out:

In the education reform battle, often times things boil down to a turf battle, and that’s what we have here.  We have some local school systems that are worried that by virtue of having state charter schools that some of their turf is getting interfered.  But it’s about the children and the choice.  It’s a control issue, and it always has been.

Competition is an excellent means of improving the quality of the children’s education.  One effect of competition is a more efficient allocation of taxpayer money, because if schools aren’t producing quality students, they don’t need to continue collecting that money.  Certainly, it’s in our interest nationally, and in Georgia’s interest and in the interest of the local communities, to have an education system that produces well-educated students capable of critical reasoning, but that interest mandates no particular structure to the system.  Competition will spur the necessary improvements—with a beneficial side effect of that improved funds allocation.  What is there to fear?

US and China’s Strategy

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Last week, Stratfor Global Intelligence published an assessment of the People’s Republic of China’s emerging strategy for dealing with the outside world.  In sum, there are three basic tenets to the developing strategy:

  • Paramount among them is the maintenance of domestic security.
  • The PRC’s industrial base, by design produces more than its domestic economy can consume, so the PRC must export goods to the rest of the world while importing raw materials.
  • The third strategic interest is in maintaining control over buffer states.

These are sequential interests; that is, each depends on the one prior, and internal security is, as Friedman writes, paramount.  Internal security in a nation of vast wealth and wealth mobility differences between, in China’s case, the coastal regions and the interior depends on keeping the people employed.  (On a related side note, it’s useful to recognize that these differences are exacerbated, among other things, by growing cultural differences between a coastal region that trades externally and so is exposed to the influences of the West and of the Republic of Korea and Japan on the one hand, and an impoverished interior, on the other, that still is “old-school” and is seen, also, as existing to supply those coastal regions with goods for export trade).  Thus, a need not only for export customers exists, but relevant to this post, a need for ensuring China’s sea lane security.  That third imperative is driven by a need to protect the population of core Chinese—Han China—which is concentrated in those coastal regions and the eastern third of China that is near those coastal regions.  Among other buffer states, the PRC count Tibet, and they would like to count the Republic of China sitting off the southeastern coast on Taiwan (which, by the way, sits on the northern mouth of the South China Sea and the southern mouth of the East China Sea).

As alluded to above, sea lanes for trade are important to Chinese economic, and so domestic, security.  Overland trade routes are both physically fraught with danger, given the terrain that must be crossed and the distances involved, and politically fraught: the countries that control that land aren’t entirely sympathetic to Chinese interests.  Those sea lanes, though, must pass through the South or East China Sea.

Mainland China has historically had difficulty depending on others for its own sustenance, originating from China’s view that it sits at the center of Heaven and so has no need of outside cooperation—the cooperation should move in the other direction.  This position has gone through a number of evolutions but remains essentially the same: we’ll go it alone, thank you very much; you’re welcome to come with us if you wish.  The view of not depending on others also is smart: what others might give, they can also take away, and then where would a dependent state be?  So China looks to securing, itself, its sea lanes, rather than depending on the British, and for the last 80 years,  the US—to maintain freedom of the seas.  China looks, though, not for freedom, but dominance over its seas as the optimal means of maintaining security.

Unable to engage the US Navy in a direct confrontation, though, China is developing other means of countering our Navy; although Friedman suggests that those alternate means are flawed.

While China has a robust land-based missile system, a land-based missile system is inherently vulnerable to strikes by cruise missiles, aircraft, unmanned aerial vehicles currently in development and other types of attack. China’s ability to fight a sustained battle is limited.  Moreover, a missile strategy works only with an effective reconnaissance capability.  You can’t destroy a ship if you don’t know where it is.  This in turn necessitates space-based systems able to identify U.S. ships and a tightly integrated fire-control system.

Friedman is right that this alone is insufficient, and he points out that China also is looking for sea ports in friendly (or at least “tradable with”) nations that are on the other end of some of those sea lanes.  China is paying, for instance, for most of or the construction of a sea port in Gwadar, Pakistan, as well as looking for similar accesses to ports in Colombo, Sri Lanka, Bangladesh, and elsewhere.  But having anchorages on either end of the sea lane doesn’t address the security of the lanes themselves.

It’s easy enough, the thinking goes, to effect a blockade of China by sitting on the outside edge of the two Seas, but until those anti-shipping missile sites have been taken out, even at that range, the blockading ships would be at risk.  (I discount the reduction in risk from the ships being mobile targets: even given the relatively slow flights of cruise missiles, ships are even slower; besides, en route and target area guidance systems—even on board ones—aren’t that hard to do anymore.)

For our part, the US is in the beginning stages of implementing a major strategic change and moving to emphasize the Pacific, and in particular the PRC, and deemphasizing Europe and the Atlantic.  DoD is intending to realign our military so that, for instance, 60% of our Naval assets will be focused on the Pacific and China, vice the current 52%.

But what does this mean in practical terms?  DoD, under President Obama’s instruction, is reducing its ship total from 285 as of last September to 220 by 2020, including a reduction from 11 carriers to 8, 53 attack submarines to 40, and eliminating altogether our guided missile submarines.  Worse, the average age of our Navy’s ships will be allowed to increase from its current 14 years to 19.  From a back of the envelope estimate, that “increase” of 52% to 60% of the Navy’s assets concentrating on the Pacific results in an actual reduction from 148 ships to 132.

It also ignores another part of the equation: while we’re busily becoming a threat (in Chinese eyes) to China’s nearby sea lanes, what about China’s more distant sea lanes—the ones that pass through the Indian Ocean, the North and South Atlantic, the Panama Canal?  And what about our own, more nearby sea lanes—those traversing the same North and South Atlantic Oceans and the Panama Canal?  And the Indian Ocean, which is important to us not only for commerce, but to support our allies and friends in the Middle East, western Asia, eastern Africa?  And to get to our allies and friends that form the rim of the South China Sea and to support our own Navy operating in theater?

So the question for the Chinese, and for our administration, comes down to this: in the event of a conflict between the PRC and the US that gets serious enough that we’d need to consider a blockade, what happens next?

China will look at the conflict between us and northern Korea and between us and Iran over whether either of those two should possess nuclear weapons (and in one case, then destroy, utterly, a life-long ally of ours), and it will decide to press ahead with its actions and run a US blockade, at gunpoint, if needs be—even with their inferior navy.  Indeed, given our administration’s repeatedly demonstrated penchant for shaking its finger very firmly at our adversaries and then accommodating them, on what basis would China take our Navy’s still superior capability seriously?  When have northern Korea or Iran—or Israel recently—taken our capabilities seriously?  What is the value of military superiority, or capability of any sort, when there is no will to use it, and China, northern Korea, Iran, and now Israel know that?

On the Subject of Taxes….

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Here are the taxes that are starting to go into effect courtesy of Obamacare.  These are in addition to the tax increase that will result next year because President Obama refuses to allow the Bush tax cuts to be extended any longer, much less made permanent.  Note: Americans for Tax Reform refers to the Mandate fines as taxes.  This is how the Obama administration is trying to weasel-word the fines in front of the Supreme Court (and did so through the lower court cases).  However, the Patient Protection and Affordable Care Act clearly and directly makes these fines, not taxes. [Emphasis is in the original.]

Individual Mandate Excise Tax(Jan 2014): Starting in 2014, anyone not buying “qualifying” health insurance must pay an income surtax according to the higher of the following

1 Adult 2 Adults 3+ Adults
2014 1% AGI/$95 1% AGI/$190 1% AGI/$285
2015 2% AGI/$325 2% AGI/$650 2% AGI/$975
2016 + 2.5% AGI/$695 2.5% AGI/$1390 2.5% AGI/$2085

Employer Mandate Tax(Jan 2014):  If an employer does not offer health coverage, and at least one employee qualifies for a health tax credit, the employer must pay an additional non-deductible tax of $2000 for all full-time employees.  This provision applies to all employers with 50 or more employees. If any employee actually receives coverage through the [government’s insurance] exchange, the penalty on the employer for that employee rises to $3000.  If the employer requires a waiting period to enroll in coverage of 30-60 days, there is a $400 tax per employee ($600 if the period is 60 days or longer).

Combined score of individual and employer mandate tax penalty: $65 billion/10 years

Surtax on Investment Income ($123 billion/Jan. 2013):  This increase involves the creation of a new, 3.8 percent surtax on investment income earned in households making at least $250,000 ($200,000 single).  This would result in the following top tax rates on investment income

Capital Gains Dividends Other*
2010-2012 15% 15% 35%
2013+ (current law) 23.8% 43.4% 43.4%
2013+ (Obama budget) 23.8%** 23.8% 43.4%

*Other unearned income includes (for surtax purposes) gross income from interest, annuities, royalties, net rents, and passive income in partnerships and Subchapter-S corporations.  It does not include municipal bond interest or life insurance proceeds, since those do not add to gross income.  It does not include active trade or business income, fair market value sales of ownership in pass-through entities, or distributions from retirement plans.  The 3.8% surtax does not apply to non-resident aliens.

**eehines Note: The Obama budget was laughed out of the Senate by his own party.

Excise Tax on Comprehensive Health Insurance Plans($32 bil/Jan 2018): Starting in 2018, new 40 percent excise tax on “Cadillac” health insurance plans ($10,200 single/$27,500 family). For early retirees and high-risk professions exists a higher threshold ($11,500 single/$29,450 family).  CPI +1 percentage point indexed.

Hike in Medicare Payroll Tax($86.8 bil/Jan 2013): Current law and changes:

First $200,000
($250,000 Married)
Employer/Employee		 All Remaining Wages
Employer/Employee
Current Law 1.45%/1.45%
2.9% self-employed		 1.45%/1.45%
2.9% self-employed
Obamacare Tax Hike 1.45%/1.45%
2.9% self-employed		 1.45%/2.35%
3.8% self-employed

Medicine Cabinet Tax($5 bil/Jan 2011): Americans no longer able to use health savings account (HSA), flexible spending account (FSA), or health reimbursement (HRA) pre-tax dollars to purchase non-prescription, over-the-counter medicines (except insulin)

HSA Withdrawal Tax Hike($1.4 bil/Jan 2011): Increases additional tax on non-medical early withdrawals from an HSA from 10 to 20 percent, disadvantaging them relative to IRAs and other tax-advantaged accounts, which remain at 10 percent.

Flexible Spending Account Cap – aka “Special Needs Kids Tax” ($13 bil/Jan 2013): Imposes cap of $2500 (Indexed to inflation after 2013) on FSAs (now unlimited).  There is one group of FSA owners for whom this new cap will be particularly cruel and onerous: parents of special needs children.  There are thousands of families with special needs children in the United States, and many of them use FSAs to pay for special needs education.  Tuition rates at one leading school that teaches special needs children in Washington, D.C. (National Child Research Center) can easily exceed $14,000 per year.  Under tax rules, FSA dollars can be used to pay for this type of special needs education.

Tax on Medical Device Manufacturers($20 bil/Jan 2013): Medical device manufacturers employ 360,000 people in 6000 plants across the country. This law imposes a new 2.3% excise tax.  Exemptions include items retailing for less than $100.

Raise “Haircut” for Medical Itemized Deduction from 7.5% to 10% of AGI($15.2 bil/Jan 2013): Currently, those facing high medical expenses are allowed a deduction for medical expenses to the extent that those expenses exceed 7.5 percent of adjusted gross income (AGI).  The new provision imposes a threshold of 10 percent of AGI; it is waived for 65+ taxpayers in 2013-2016 only.

Tax on Indoor Tanning Services($2.7 billion/July 1, 2010): New 10 percent excise tax on Americans using indoor tanning salons

Elimination of tax deduction for employer-provided retirement Rx drug coverage in coordination with Medicare Part D($4.5 bil/Jan 2013)

Blue Cross/Blue Shield Tax Hike($0.4 bil/Jan 2010): The special tax deduction in current law for Blue Cross/Blue Shield companies would only be allowed if 85 percent or more of premium revenues are spent on clinical services

Excise Tax on Charitable Hospitals(Min$/immediate): $50,000 per hospital if they fail to meet new “community health assessment needs,” “financial assistance,” and “billing and collection” rules set by HHS

Tax on Innovator Drug Companies($22.2 bil/Jan 2010): $2.3 billion annual tax on the industry imposed relative to share of sales made that year.

Tax on Health Insurers($60.1 bil/Jan 2014): Annual tax on the industry imposed relative to health insurance premiums collected that year. The stipulation phases in gradually until 2018, and is fully-imposed on firms with $50 million in profits.

$500,000 Annual Executive Compensation Limit for Health Insurance Executives($0.6 bil/Jan 2013)

Employer Reporting of Insurance on W-2(Min$/Jan 2011): Preamble to taxing health benefits on individual tax returns.

Corporate 1099-MISC Information Reporting($17.1 bil/Jan 2012): Requires businesses to send 1099-MISC information tax forms to corporations (currently limited to individuals), a huge compliance burden for small employers

“Black liquor” tax hike(Tax hike of $23.6 billion).  This is a tax increase on a type of bio-fuel.

Codification of the “economic substance doctrine”(Tax hike of $4.5 billion).  This provision allows the IRS to disallow completely-legal tax deductions and other legal tax-minimizing plans just because the IRS deems that the action lacks “substance” and is merely intended to reduce taxes owed.

That’s a total of $12 billion in taxes increases already inflicted in 2010 and 2011, $290 billion more in increased/newly created taxes starting next year, and yet another $60 billion starting in 2014.  Plus the rapidly accelerating system of fines for not buying or providing health insurance, which total $65 billion over 10 years; and another $32 billion in taxes, starting in 2018, for buying more health insurance than Government has determined you need—those Cadillac plans.

A Ruling on the 2nd Amendment

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US District Judge Benson Everett Legg (Maryland District), in a Monday ruling has said that Maryland residents are not required, as a Marayland had had it, to convince authorities that they have a “good and substantial reason” to own a handgun.

Judge Legg wrote, among other things,

…the Court finds that the right to bear arms is not limited to the home. The signposts left by recent Supreme Court and Fourth Circuit case law all point to the conclusion that Woollard‘s ―claim to self-defense—asserted by him as a law-abiding citizen…—does implicate the Second Amendment, albeit subject to lawful limitations.

He went on [emphasis mine]:

A law that burdens the exercise of an enumerated constitutional right by simply making that right more difficult to exercise cannot be considered “reasonably adapted” to a government interest, no matter how substantial that interest may be.  Maryland‘s goal of “minimizing the proliferation of handguns among those who do not have a demonstrated need for them,”…is not a permissible method of preventing crime or ensuring public safety; it burdens the right too broadly.  Those who drafted and ratified the Second Amendment surely knew that the right they were enshrining carried a risk of misuse, and states have considerable latitude to channel the exercise of the right in ways that will minimize that risk.  States may not, however, seek to reduce the danger by means of widespread curtailment of the right itself.  “[E]ven the most legitimate goal may not be advanced in a constitutionally impermissible manner.”

At bottom, this case rests on a simple proposition: If the Government wishes to burden a right guaranteed by the Constitution, it may do so provided that it can show a satisfactory justification and a sufficiently adapted method.  The showing, however, is always the Government‘s to make.  A citizen may not be required to offer a “good and substantial reason” why he should be permitted to exercise his rights.  The right‘s existence is all the reason he needs.

Maryland’s Assistant Attorney General, Matthew Fader, says he’ll appeal, saying “we” disagree, and taking note of the “very important implications of the ruling for public safety.”  He’s wrong, though, on two counts: in the first place, the public safety is maximized by hewing to the Constitution, not by deviating from it.  In the second place, he apparently wasn’t paying attention to the Legg’s ruling:

States may not, however, seek to reduce the danger [of misuse] by means of widespread curtailment of the right itself.

Judge Legg has the right of it.

Our Feckless Foreign Policy

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The Progressive line on American foreign policy was first brought to light by Presidential candidate John Kerry in 2004 when he insisted, with a straight face, that America’s military policy must pass a “global test” before it can be implemented.  That’s a policy that’s alive and well in the present administration, as this exchange during last week’s Senate Armed Services Committee hearing between Senator Jeff Sessions (R, AL) and Secretary of Defense, Leon Panetta, demonstrates (the exchange begins at about the 2:00 minute mark) [emphasis mine].

SESSIONS: Do you think you can act without Congress and initiate a no-fly zone in Syria without congressional approval?

PANETTA: …our goal would be to seek international permission, and we would come to the Congress and inform you and determine how best to approach this; whether or not we would want to get permission from the Congress, I think those are issues we would have to discuss as we decide what to do here.

SESSIONS: Well I am almost breathless about that because what I heard you say is, “we’re going to seek international approval and we will come and tell the Congress what we might do, and we might seek congressional approval” … Would you like to clarify that?

PANETTA: I have also served with Republican Presidents and Democratic Presidents who have always reserved the right to defend this country if necessary.

SESSIONS: But before you would do this, you would seek permission of the international authorities?

PANETTA: If we are working with an international coalition or NATO we would want to be able to get appropriate permissions in order to be able to do that.  All of these countries would want to have some kind of legal basis on which to act.

SESSIONS: What “legal basis” are you looking for?  What entity?

PANETTA: If NATO made the decision to go in, that would be one.  If we developed an international coalition beyond NATO then obviously some kind of UN security resolution would be the basis for that.

SESSIONS: So you are saying NATO would give you a “legal basis?”  And an ad hoc coalition of nations would provide a “legal basis?”

PANETTA: We would seek whatever legal basis we would need in order to make that justified. We can’t just pull them all together without getting the legal basis on which to act.

…

SESSIONS: I’m all for having international support, but I’m really baffled by the idea that somehow an international assembly provides a legal basis for the United States military to be deployed in combat.  I don’t think it’s close to being correct.  They provide no legal authority.  The only legal authority that’s required to deploy the U.S. military is the Congress and the president and the law in the Constitution.

PANETTA:  Let me, just for the record, be clear again.  When it comes to the national defense of this country, the President of the United States has the authority under the Constitution to act to defend this country, and we will.  If it comes to an operation where we’re trying to build a coalition of nations to work together to go in and operate as we did in Libya, or Bosnia, or for that matter, Afghanistan, we want to do it with permissions either by NATO or by the international community.

So, what do we have, then?  Panetta has gone even farther than Kerry, now insisting that “international permission,” rather than the Constitution (which includes authorization by Congress), is the “legal basis” for American use of our military capability in an international effort.  The administration seems to accept foreign control, foreign permissions, over whether we will use our military to conduct national defense activities in conjunction with foreign groups of countries; we have no authority of our own to employ our forces in that environment.  The President, intimates Panetta, executes his national defense obligations absent Congress’ involvement, although there is a willingness to discuss “whether or not we would want to get [Congressional] permission.”  Notice, also, that, even after Panetta’s “clarification,” neither the Constitution nor the Congress enter into it.  Ever.

It seems as though, given the entirety of Panetta’s responses, that he didn’t even understand the questions.

As Sessions said, international support is good.  But a sovereign nation needs no one else’s permission to use its military forces, either unilaterally or in concert with other nations.  Period.  That’s not the same as having an agreement with those others to engage in a joint action of some sort.  Those agreements, though, only outline the various responsibilities of the members of the coalition (ideally founded on the individual capabilities of those members); they do not constitute permission for employment.

At least General Martin Dempsey (those first two minutes of the video) understands for whom he works.

h/t Power Line