Defend Free Enterprise Report 04 03 09

Friday, April 3, 2009

To: Friends Of Free Enterprise

From: Gary L. Bauer

(This is the second of our weekly Defend Free Enterprise Reports. I hope you will share them with like-minded friends and business associates. Please encourage them to sign up at http://www.defendfreeenterprise.org or they can click the link at the end of this report.)

Congress Passes Obama’s Budget

The House and Senate essentially rubberstamped President Obama’s budget –a multi-year, multi-trillion dollar blueprint of deficits and debt as far as the eye can see. In fact, the Congressional Budget Office estimated that Barack Obama’s budget would add nearly ten trillion dollars to the national debt – doubling the debt in five years and tripling it ten! The Associated Press reported, “President Barack Obama’s budget would produce … more than four times the deficits of Republican George W. Bush’s presidency.” In addition, it contains hundreds of billions of dollars in tax hikes and lays the foundation for nationalized health care.

The vote in the House of Representatives was 233-to-196. Every “Yes” vote in favor of tripling the national debt came from a Democrat. Not one House Republican voted for this budget, and 20 Democrats joined the Republicans in voting “No.” The vote in the Senate was 55-to-43. Every “Yes” vote in favor of tripling the national debt came from a Democrat. Every Senate Republican and two Democrats (Evan Bayh of Indiana and Ben Nelson of Nebraska) voted “No.” That means that the only thing “bi-partisan” about this budget was the opposition to it!

Here a few noteworthy items.

* Sen. Mike Johanns (R-NE) successfully passed an amendment to block special “reconciliation” rules in the budget process from applying to the administration’s planned carbon “cap and trade” scheme, which I refer to as “cap and tax.” (It’s a massive new tax on energy that may cost every American business and family thousands of dollars a year! Administration officials have told Senate staff that they believe it could tax $2 trillion out of the economy.) What the Johanns amendment means is that the “cap and tax” scheme can be filibustered in the Senate at a later date. Every Senate Republican supported the Johanns amendment, as did 26 Democrats.

* Senators were even more emphatic in their rejection (94-to-3) of President Obama’s idea to limit tax deductions for charitable contributions from successful business owners and families.

* Here’s an additional point to consider. The budget is an important indicator of Washington’s principles and intent, but it is mainly a non-binding outline of what the White House and Congress hopes to do in the years ahead. (And it’s clear there are a lot of big spenders and tax hikers in Congress today!) The real heavy lifting will come later when the White House and congressional leaders propose specific bills and legislation to enact their agenda. We will keep you posted and alert you when these critical issues come up for a vote.

Bad Precedents

When Obama suggested in early February that he wanted to limit executive compensation at companies receiving bailout money, I was worried that it wouldn’t be long before liberals took his idea and ran wild with it. Within 24 hours, Rep. Barney Frank (D-MA) was talking about extending compensation restrictions to all financial institutions and possibly even to all U.S. companies.

This week the House of Representatives took the first step in that direction by passing H.R. 1664, the “Pay for Performance Act,” by a vote of 247-to-171. “Pay for Performance” sounds innocent enough, but it establishes a very insidious precedent.

H.R. 1664 allows the Secretary of the Treasury and key congressional chairmen (namely Barney Frank and Chris Dodd) to determine whether compensation is “unreasonable or excessive” for all executives and employees at any financial institution that has received TARP funds. Do we really want Tim Geithner, Barney Frank and Chris Dodd deciding how much to pay the secretary at the front desk or the clerk in the mail room? And what happens to these companies when large numbers of employees decide they don’t like Barney Frank’s evaluation of their performance? Thanks to Big Government, these companies will be unable to retain a competent workforce and may become dependent on the government’s largess, just like welfare.

But this is what happens when liberal politicians think they know better than the business owners who run their own companies. This is what happens when Big Government sticks its big nose in the free market. And if we establish the principle that taxpayer subsidizes allow the government to set salaries, what about asset depreciation or other business-friendly tax breaks? Aren’t those all forms of government subsidy?

“Capitalism Will Be Different”

A few weeks ago, Treasury Secretary Timothy Geithner said on the Charlie Rose Show, “I think capitalism will be different.” This week, President Obama fired the head of General Motors and the government is now seeking to restructure its board of directors. Yes, capitalism has changed alright. I’m still waiting to hear that President Obama is also sending a pink slip to the president of the United Auto Workers union, but I won’t hold my breath.

Meanwhile, Geithner renewed the government’s call this week for even more power over American industry. During testimony in the House of Representatives in defense of his institutional takeover plan, Rep. Donald Manzullo (R-IL) challenged Geithner, asking, “Do you realize how radical your proposal is?” Geithner responed, “It’s not radical. . .” But Manzullo shot back, “You’re talking about seizing private businesses and you don’t consider that radical?”

Today’s Washington Post reports that while Geithner served as head of the New York Federal Reserve Bank working “to solve narrow mechanical issues in the derivatives market, [Geithner] missed clear signs of a catastrophe in the making. …Although Geithner repeatedly raised concerns … he and the Federal Reserve system did not act with enough force to blunt the troubles that ensued.” Geithner admits, “We’re having a major financial crisis in part because of failures of supervision.”

Talk about rewarding failure! I’ve often said that the best way to get promoted in government is to mess up big. So, right under Geithner’s nose, major New York banks and institutions blew up, and this guy gets promoted and is now asking for even more power. This is the same guy who can’t even handle Turbo Tax! But don’t think for a second that if you make a mistake on your taxes that you will qualify for a “Geithner tax amnesty.”

And here’s an example of how Big Government is working to punish success. East Bridgewater Savings Bank has no delinquent loans and no foreclosures. It has $135 million in assets and $84 million in deposits. And even in this atmosphere it has turned a profit. Yet, the FDIC has issued the bank a critical rating under the Community Reinvestment Act. Why? Because, according to our government, East Bridgewater Savings Bank is not being risky enough! You can read the story here.

Thoughts On The G-20 Summit

I watched media coverage of the G-20 summit with great interest. While I was concerned about what policies might come out of the London gathering, I was equally concerned about the politics – especially the class warfare rhetoric. Did you see the mobs? The media tried to pass them off as just normal folks angry about the economy. It was in fact the far Left – anti-war groups, Muslim activists, anarchists, radical socialists. There was even a banner that read “Abolish Money!” Now that’s a strategy.

Unfortunately, we are seeing more and more of this here in America. Taxpayer-funded groups like ACORN are working hand-in-hand with labor unions to stage protests, like staging sit-ins in banks, “liberating” homes from foreclosure, and driving buses in front of the homes of AIG executives. But their efforts are fanning the flames of envy, fueling hatred and fear. Many AIG executives and employees have received death threats and other disgusting messages. Some have taken to hiring private security guards to protect their homes and families.

In fact, there is a shocking report today in Politico about a recent White House meeting between bank CEOs and the president about compensation. As the executives were explaining the need to pay their best and brightest well, President Obama shut down the discussion, telling them, “Be careful how you make those statements, gentlemen. The public isn’t buying that. My administration is the only thing between you and the pitchforks.”

Perhaps Obama’s comments were just a polite PR suggestion. But given Obama’s well-known connection to ACORN, some might see his comment as a warning about as subtle as a dead fish on your door step. By the way, this meeting occurred on the same day that GM’s Rick Wagoner was in Washington meeting with officials at the Treasury Department, where he told to “step aside.” At least the banking executives got out of town with their jobs.

The media and liberal politicians continue to promote the myth that “salvation” will come from Big Government. We know that America will only come through this because of you! The only way we get out of this mess is if investors and business owners and employees are rewarded for their hard work and willingness to take risks.

In the days and weeks ahead, we will be fighting hard to defend free enterprise and promote sound policies that will grow the economy, not the government.

Capital Prayer Alert!

Friday, April 3, 2009

To: Friends & Supporters of Campaign for Working Families

From: Carol Bauer

As you know, my wife, Carol, prepares a prayer alert about once a month. We hope you will share Carol’s writing with your friends and fellow worshippers. Thank you for taking an interest in her monthly devotion. – Gary

Capital Prayer Alert

Spring has finally arrived in Washington. The gray and gloom of winter has slowly given way to the bright colors of spring in the form of crocus, daffodils and cherry blossoms. Interestingly, there were many in the electorate who thought they voted for a new season in politics, a clean break from what they saw as a gloomy era of partisanship. They thought they were going to get something bright, clean and fresh like the new season. Instead, what has arrived in the halls of Washington is a revved up version of partisanship moving along in fast forward to change the foundations of American society.

Those who predicted that the incoming administration would claim centrist ground have been proved wrong. From big ticket spending priorities and unimaginable national debt to government control of financial institutions, from a weak foreign policy to the promotion of a radical abortion position, the new president flits from one issue and venue to another pronouncing sweeping political changes that must be made NOW. You get the impression they don’t want us to have the time to examine the details of any of it lest we catch on to the wholesale effort to remake America. The initial warm glow is over, and in its place are the red hot choices that our elected officials must make, and in short order.

Pray for those who serve in the House and Senate and are in a position to put their stamp of approval or disapproval on the administration’s ambitious plans. Ask God to grant them insight, wisdom and boldness to ask the right questions. Prompt them to be creative in shedding light on the consequences of today’s decisions on tomorrow’s taxpayers, our children and grandchildren. Ask our Heavenly Father to raise up among them some heroes who would buck the prevailing political winds. May they be articulate and engaging as they give voice to our shared values.

Finally, pray that those who see themselves as elected to keep our country safe from outside forces and well grounded in the values that have served our country well will create opportunities to examine the fine points of the sweeping changes that are planned. Pray for time to look for, consider and evaluate unintended consequences.

The week between Palm Sunday and Easter is a time when Members of Congress are in recess and many will spend all or part of that time in their home states and districts. There will be town meetings, open office hours and various event settings where these elected officials will be present to listen to the voters. There have been times in recent years, during the debate over immigration “reform” for example, when Washington officeholders got an earful when they went home and returned to Washington with a different take on an issue that looked very different from the rarefied atmosphere of the nation’s capital.

One of the most effective ways to influence officeholders is with convincing facts – the number of jobs that will be lost in your company or community because of skyrocketing energy costs, how long business owners will wait to even think of new hiring based on increased employer health insurance costs, the effect of the departure of experienced leadership in local financial institutions as the federal government exerts more control, etc. The case can be made in person or in writing, but it must be made.

Pray for the will and discipline to make your case to those in a position to vote in Washington. They may be uninformed or wrongly informed about the long-term ramifications of critical votes they are about to make. Ask God for insights to illustrate your points effectively. Pray that your words and facts would be given a fair hearing.

Your prayers for our country, its leaders and the challenging road ahead can make a difference!

End Of Day Report Gary Bauer 03 25 09

Wednesday, March 25, 2009

To: Friends & Supporters

From: Gary L. Bauer

What Was That?

Last night, President Obama held a nationally televised White House press conference in prime time to discuss the state of the nation’s economy. Given the extent of the economic crisis and the serious challenges confronting the nation, the president probably should be holding a lot of press conferences. I think this was his second. Unfortunately, the president said very little last night that was new or different from what he has been saying for the past 60 days.

What did catch my attention, however, was the president’s absolute commitment to raising taxes. When pressed to explain his desire to limit deductions for mortgage interest and charitable contributions, President Obama responded:

“I think this was a good idea. I think it is a realistic way for us to raise some revenue from people who benefitted enormously over the last several years. …They’ll still be well-to-do. And, you know, …in some cases those who are more fortunate are going to have to pay a little bit more.”
You’ll notice there’s no discussion of cutting government spending. Instead, the president says folks who have “benefitted” are “fortunate,” as if they won the lottery. I know many business owners consider themselves fortunate, but I also know they worked very hard to get where they are today. And that hard work does not deserve to be punished by Big Government because Barack Obama thinks some people “benefitted” too much from their own effort.

We’re hearing a lot about greed these days from Obama and liberal Democrats in Congress. During the campaign, candidate Obama criticized as “greedy” folks who objected to his tax hikes. What about the envy of Big Government? If you’re “fortunate” enough to be “well-to-do,” Obama wants to punish you by raising your taxes. And if you’re generous with your money, he’s going to punish you again by limiting your charitable deductions!

By the way, the president’s thin skin was on full display last night – you may have noticed that the TOTUS wasn’t there. What’s that, you ask? Teleprompter Of The United States. Sensitive to the criticism of his “crutch,” President Obama opted to trade in the TOTUS for the “Obamatron” – a jumbo flat screen TV in the back of the room.

But don’t worry — TOTUS is doing fine and has recently launched a blog to keep you posted on daily events. You can check out the latest TOTUS postings here.

Is That it?

A recent Pentagon report looked around the world to identify the countries at the greatest risk of collapsing, thereby creating the greatest risk to the United States. Two nations topped the list. The first was Pakistan — an unstable nation with a large radical Muslim population; it borders Afghanistan; some of its territory is a safe haven for Taliban and Al Qaeda terrorists; it has bad relations with its neighbor India; and it possesses nuclear weapons.

The other nation that attracted the Pentagon’s concern was Mexico. Yes, the deteriorating situation south of the border has gotten so bad that the Pentagon recently warned that we should begin planning for the “sudden collapse” of the Mexican state. Eight thousand people have been killed in the past two years as the Mexican government has fought to reclaim whole cities and towns from vicious drug lords. Hundreds of people have been beheaded.

The situation is spilling over the border. Phoenix, Arizona, is the now the kidnapping capital of America. Arizona’s Attorney General testified before Congress last week, begging for help and warning, “The threat posed to American communities from this trafficking cannot be overestimated.” Texas Governor Rick Perry has requested 1,000 National Guard troops be sent to the border.

What is Washington doing? Yesterday, Homeland Security Secretary Janet Napolitano announced a “very robust movement of personnel” — about 350 people, many of them analysts and liaison officers, but no troops. Meanwhile, the Justice Department has launched a civil rights investigation against Maricopa County Sheriff Joe Arpaio, who has been aggressively enforcing immigration laws.

I wonder how much of the “stimulus” bill’s infrastructure money was directed for the border fence.

Culture of Corruption

Democrat Charlie Rangel, chairman of the House committee that writes our nation’s tax laws, is in so much trouble for evading taxes that the liberal New York Times has called on him to step down. It seems that Rangel has been sharing some tips with his Democrat buddies on the Ways and Means Committee.

Several media reports in recent days have noted that Rep. Pete Stark (D-CA), the second highest ranking Democrat on the Ways and Means Committee (whose members write our tax laws), very likely has been claiming tax credits that he is not entitled to.

While holding a California driver’s license, being registered to vote in California and representing California’s 13th Congressional District, Stark has been claiming a $3,800 homestead tax credit on his $1.6 million mansion in Anne Arundel County, Maryland. The Los Angeles Times reports that Maryland authorities recently revoked a tax break that Rep. Eliot Engel (D-NY) had been claiming on his Maryland home.

Once again we see why liberal Democrats love higher taxes – they don’t pay them!

But here’s the real outrage of the day. According to the Washington Times, the Democrat Senatorial Campaign Committee is still holding on to $100,000 in campaign contributions from convicted conman Bernie Madoff.

While the government is frantically trying to recover Madoff’s assets, while thousands of individuals and charities are struggling to rebuild from the wreckage of Madoff’s Ponzi scheme, while liberal politicians are demanding AIG workers return legally contracted bonus money that they earned and voting for confiscatory taxes on legally contracted bonuses, the Democrat Senatorial Campaign Committee is keeping Madoff’s stolen loot!

Call the Democrat Senatorial Campaign Committee at (202) 224-2447 and demand the Democrats return Madoff’s money.

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