December 13, 2010

Obama OK's massive expansion of school nutrition programs

Posted by David N. Bass at 5:50 PM

Earlier today, President Barack Obama signed into law a reauthorization of the Child Nutrition Act that adds another $4.5 billion in funding over the next 10 years. The CNA is the federal legislation that governs entitlements such as the National School Lunch Program.

The bill, though, failed to deal in any substantial way with potential fraud in the school lunch program. Instead, it expanded the base of students eligible to participate.

The bill does have a silver lining. It requires school districts with high administrative errors rates in determining children's eligibility to review their work for accuracy before notifying families of whether or not they'll qualify for, or remain in, the program. That's likely to reduce the number of families participating who are above the income threshold (the upper limit is around $40,000 per-year for a family of four).

Even so, the number of ineligible families participating as a result of administrative error is much lower than the number of ineligible families who participate as a result of parents or guardians misreporting income on the application forms (and possibly doing so intentionally to cheat the system). Yet the reauthorization legislation doesn't the address the latter of these two.

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Pushing global warming indoctrination through public schools

Posted by Mitch Kokai at 2:24 PM

Fewer people are buying into global warming alarmists' arguments about the potential dangers of climate change.

But Paul Chesser of the American Tradition Institute says that's not stopping the alarmists from pushing their gloom-and-doom arguments. In a presentation to the John Locke Foundation's Shaftesbury Society, Chesser explained how a group called the Alliance for Climate Education is spreading those arguments through school-based presentations.

Chesser, who's followed climate issues since his days as a Carolina Journal associate editor, offers some background in the video clip below.

2:45 p.m. update: Click play below to watch the full 45:05 presentation.

You'll find other John Locke Foundation video presentations here.

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Why do they so furiously rage over the tax deal?

Posted by George Leef at 2:05 PM

Jeff Jacoby tries here to figure out why the progressives, who have been strangely quiet over so many Obama policies that continue Bush policies they said they loathed, are in a rage over the tax deal.

I think the key is in the phrase Jacoby quotes the progressives as using -- that rich people shouldn't keep money "they don't really need." Why not have a centrally-planned (i.e., dictated) society in which the government allows people to keep only as much as they "need"? Wouldn't that be much more fair?

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Re: Unconstitutional

Posted by George Leef at 1:47 PM

Cato's Michael Cannon offers his analysis of Judge Hudson's decision here.

We've been slipping fast into a nation afflicted by terminal politicization, but this decision offers some HOPE of stopping the progression of the disease.

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Unconstitutional

Posted by Joseph Coletti at 1:22 PM

As Rick noted, Federal Judge Henry Hudson returned from the uncharted territory of individual insurance mandates and declared they really do violate the Constitution.

The unchecked expansion of congressional power to the limits suggested by the Minimum Essential Coverage Provision would invite unbridled exercise of federal police powers. At its core, this dispute is not simply about regulating the business of insurance--or crafting a scheme of universal health insurance coverage--it's about an individual's right to choose to participate.

Judge Hudson cut this part of the law from the rest because the Congress made a hash of the process:

The final element of the analysis is difficult to apply given the haste with which the final version of the 2,700 page bill was rushed to the floor for a Christmas Eve vote. It would be virtually impossible within the present record to determine whether Congress would have passed this bill, encompassing a wide variety of topics related and unrelated to health care without, Section 1501. ... Moreover, without the benefit of extensive expert testimony and significant supplementation of the record, this Court cannot determine what, if any, portion of the bill would not be able to survive independently.

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Federal judge: Obamacare individual mandate unconstitutional

Posted by Rick Henderson at 1:01 PM

U.S. District Court Judge Henry Hudson sided with Virginia Attorney General Ken Cucinelli, ruling that the individual mandate in this year's federal health care law is an unconstitutional expansion of the Constitution's Commerce Clause.

Cucinelli argued that by forcing individuals to purchase health insurance from a government-approved provider or pay a fine, the mandate regulated inactivity, which ain't allowed.

Two other federal district judges have rejected constitutional challenges to the health care law, so the Supreme Court eventually will settle this matter.

Unless the law is repealed before then.

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Southport port ... sunk

Posted by Rick Henderson at 10:44 AM

So reports Gareth McGrath of the Wilmington Star-News.

Earlier this year, the N.C. State Ports Authority placed the proposed megaport on "indefinite hold" after the General Assembly killed funding for a feasibility study for the port. The state had acquired property near the Brunswick nuclear power plant without conducting such a study.

The legislature cut funding thanks to the actions of a local group opposing the project, NoPort Southport, which drew attention in the local media and from Carolina Journal's Don Carrington and the News & Observer.

Last week, the Ports Authority decided to "refocus," having the Department of Environment and Natural Resources ask the U.S. Army Corps of Engineers to consider digging a deeper shipping channel near Wilmington, expanding capacity at the existing state port.

Once again, sunlight is an excellent disinfectant.

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A really foolish letter

Posted by George Leef at 09:39 AM

Today's WSJ contains this really foolish letter from a guy who is upset over the Journal's position against the estate tax. Here it is:

There is much to quarrel with in your editorial, but let's focus on the amusing description of the estate tax as "this immoral tax on a lifetime of thrift." I suppose that anyone who can attribute a $5 million inheritance to decades of shopping at Costco and using generic toilet paper deserves to be exempted from such a tax.

Otherwise, those who are bequeathed multiple millions have a moral obligation to contribute a large chunk of it to the public good. The legal obligation should be no less stringent.

Josh Trevers

Woodside, N.Y.

Put aside Trevers' ridiculous assertion that people can only accumulate capital by living an ultra-frugal life. What is really foolish is his assumption that money sucked into the maw of the federal government does "public good" while money left to be spent, invested, or donated by the recipient of a bequest does not. If anything, it's the exact opposite. The federal government squanders immense wealth on special interest gambits, destructive welfare and warfare, bloated government employee payrolls, and so on. I'd say that there is something close to a moral obligation to keep as much money as possible out of the hands of the federal Leviathan.

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Are parts of North Carolina "underserved"?

Posted by George Leef at 08:53 AM

In today's Pope Center piece Duke Cheston criticizes the decision to build a new dental school at East Carolina. The key justification for the decision to build a new dental school at ECU is that areas of the state are supposedly "underserved" by dentists. There are a few counties with no practicing dentists at all! State politicians to the rescue!

The troubles with this notion, Cheston shows, are several. First, county borders don't matter to people and it's easy to get to a dentist if you want to. Using some nifty google research, Cheston finds that the most time anyone in a county without a dentist would have to drive to get to one is 54 minutes. The argument that the state faces a problem because a few people have to spend somewhat more time than most to get to a dentist when they need to is far-fetched.

Just as far-fetched is the idea that putting a new dental school in Greenville (closer to those rural counties with few or no dentists than is Chapel Hill) will somehow solve this alleged problem. A student who graduates from a dental school, even one located near rural areas and that tries to attract students from such areas, is going to go where the demand for dentists is strongest -- where the can get the best return on his investment. So what we have here is a non-solution to a non-problem. This is another case of politicians wanting to spend money concocting a silly argument to justify their action.

I'll add one more point: there is no reason why dentists who are going to practice in North Carolina have to get their dental training within state borders. If dental licensing is a barrier to entry against those who studied in other states or countries, the state government should change the law so there is no discrimination against those who wish to enter from outside of the state.

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An interesting admission about the ‘green economy’

Posted by Mitch Kokai at 06:51 AM

The short-term future of America's green economy depends on the extension of a popular tax credit of up to 30% for wind, solar, geothermal and other renewable-energy projects. Obama's stimulus package converted the credit into a cash grant that served the same purpose, supporting 1,179 solar installations and 211 wind projects with investments of over $16 billion since last February, reviving industries that stalled during the financial meltdown of 2008. It has bipartisan support, but unless Congress intervenes, it will vanish on Dec. 31.

In other words, the “green economy” depends on government propping it up with money American taxpayers don’t have. This should surprise no one who has read this forum’s discussion of “green economy issues here, here, and here.

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Tax deal fallacies

Posted by Mitch Kokai at 06:49 AM

[T]he tax cuts for the richest 2% of Americans would also be extended for two years and the tax on inheritances would be lowered from the Obama goal of 45% to 35%, with the first $5 million tax-free. The cost of these measures: about $100 billion more than Obama wanted to spend.

Fallacy No. 1: While almost every commentator has discussed “tax cuts” or “Bush tax cuts,” the issue actually involves tax rates. The Republican position focuses on maintaining existing tax rates. There is no tax cut. What the deal would do is prevent a tax hike.

Fallacy No. 2: TIME’s Michael Scherer buys into the notion that the debate revolves around the “richest 2% of Americans.” Actually, the debate involves those in the top 2 percent for annual taxable income. Some of these taxpayers are rich. Many are not. Some are small business owners who file individual — rather than corporate — tax returns. Others are taxpayers with one-year windfalls who will never approach that top 2 percent again. Calling these taxpayers the “richest 2%” is a shameless appeal to class envy.

Fallacy No. 3: It would be hard to lower a tax that has a current rate of zero, but that’s the implication of the line that “the tax on inheritances would be lowered.” There is no estate tax at this point. It’s true that a 35 percent estate tax rate would be lower than “the Obama goal,” and lower than the 55 percent rate set to kick in for 2011 with no congressional action. But that doesn’t mean the existing tax would be lowered.

Fallacy No. 4: The idea that these measures “cost” anything assumes that the money is the government’s to spend in the first place. But government spends the money only after taking it by force from those who earned it. Lower tax rates — income, estate, corporate, sales — mean that people who earn money keep more of what they earn, rather than surrendering it to the government. It would be more accurate to talk about the cost to the economy of pursuing overly high tax rates.

Regarding the future of the estate tax, Adam Nicholson of the American Family Business Institute discussed its harmful impact earlier this year in an interview with Carolina Journal Radio:

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Shocking news: People and businesses would adapt to a warmer climate!

Posted by Mitch Kokai at 06:48 AM

This reminds me of the observations Roy Spencer made during a 2008 interview with Carolina Journal Radio:

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The future of public pensions?

Posted by Mitch Kokai at 06:47 AM

What’s the response from the nation’s ninth-largest city? An idea that might make sense for North Carolina as well:

Mayor Jerry Sanders unveiled what he calls a radical idea: He'll ask voters to eliminate the city's traditional defined-benefit pension plans for new employees, offering them 401(k)-like savings accounts instead. "We saw the private sector go through this," the 60-year-old Republican says. "Government will have to relook at how we do stuff as well." ...

Defined-contribution plans such as 401(k)s, where employees bear the risk of poor investments, are a rarity in the public sector. Only 17 percent of government workers have such accounts, about one-third the number in the private sector. Says Chuck Reed, the mayor of San Jose, which is also considering cutting pension benefits to new employees: "San Diego is the leader, the bleeding edge."

Of course, the idea of shifting toward a defined-contribution system is nothing new.

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Charlotte’s role in the recent banking drama

Posted by Mitch Kokai at 06:46 AM

As a Scotch-drinking Mississippian, BofA's [Ken] Lewis had reservations about the white-wine-swilling executives on Wall Street. Yet Lewis lusted for Merrill and the Street cred the firm provided. After Lewis bagged his prey, he "paraded Thain around as if he were a trophy." In Farrell's words, Thain was "an exotic creature captured on safari who would now be on display at the bank's headquarters." Of course, this was before Lewis actually looked closely at Merrill's books in early 2009. By then, his directors had had enough of his showmanship. They gave him the boot and a $125 million retirement package.

Of course, Carolina Journal Radio listeners had a chance this weekend to learn about another recent book that chronicles the impact of the financial crisis on Charlotte. Click play below for a snippet of a conversation with Charlotte Observer banking reporter Rick Rothacker about his book Banktown.

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New Carolina Journal Online features

Posted by Mitch Kokai at 06:38 AM

Karen Welsh's new Carolina Journal Online exclusive focuses on a stream reclassification proposal that's worrying some Transylvania County residents.

John Hood's Daily Journal pours cold water on the fanciful claims of those who back large-scale public transit programs.

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