No more power for a failed government.

Whereas in the present context, government has exhibited behaviors such that they have completely eroded my trust, I am opposed to any legislation that even minimally empowers them. Some might (and have) with knee-jerk style justification, concluded that I’m something of an anarchist. That, or at the very least a laissez faire capitalist longing for the days of sweat shops, pollution and the company store. The truth is of course that there is a rightful role of government, and it is only about the excesses that I object. When the individual motivations or business incentives of various decisions are such that they are detrimental to the society, and to the extent that polite words from a neighbor are insufficient to remedy a situation, laws and government play a vital role. When the private incentives to embark a goal are insufficient to accomplish an important objective for the preservation and furtherance of the nation and its citizens, government plays a role.

When it comes to implementing an extensive and punitive set of regulations and providing funds to create or impose a subjective vision of “utopia” neither the government, nor any individual or organization is within it’s rightful power to do so. Our government’s fundamental mission should be to ensure that such imposition never happens, and to create the conditions conducive to maximizing the ability of the citizenry to exercise their liberties. It is therefore abhorrent for the government itself to become the imposer or to create conditions which facilitate such imposition, be it by foreign powers or selectively chosen private organizations inside the nation. The nation that this government is sworn to preserve, protect and defend.

On issues with which specific rules, laws and procedures might come into conflict with individual liberty, it is incumbent upon our elected leaders to approach the idea with the utmost consideration for the latter. Fallibility is an inherent to the human condition, and even the most intelligent and well intentioned people or groups cannot escape the fact. It is therefore even more critical that government approach its role with the perspective of a minimalist. Their goals and activities should mirror broad support, while resisting the temptation to be simply populist, thereby ensuring to the utmost the protection of the individual from tyranny, including the tyranny of the majority. Government should not be doing ONE SINGLE THING to make a decent, law abiding, taxpaying citizen greatly concerned, upset or otherwise seriously troubled. Not one law should impose upon the freedom of the individual, including financial freedom, without the most logical and most important justification.

When I look at the litany of activities with which our government has failed in this mission, it should be of little doubt to anyone that a patriotic citizen should seek to prevent the accumulation of power by that institution, and to endeavor to strip it of the assumed authority which it is presently abusing so willfully and maliciously.

An Economy in the ICU

The Vermont economy is on life support and could slip into a coma without drastic changes in how our state government leaders approach their fiduciary responsibilities. This is the only conclusion a reasonable person can make after attending a presentation by Tom Licata, founder of Vermonters for Economic Health.

VEH is a grass-roots, citizen-led organization with a simple mission: to promote economic health and fiscal responsibility in Vermont. Its Web site can be found at http://www.vteh.org.

Licata's colorful graphs and pie charts juxtapose with his sobering fiscal facts to confirm what hardworking Vermont taxpayers already suspect -- that despite the incredibly high taxes we pay at every level of Vermont government, the coffers are empty. Well, maybe not quite empty -- they are actually full of IOUs.

In a nutshell, these are the facts we must face: Vermont has lived beyond its means for far too long. According to VEH's figures (derived from Vermont's Joint Fiscal Office), Vermont faces a $470 million shortfall in its general fund between 2011 and 2014. Astonishingly, between the years 2000 and 2007, state government payroll and employee benefit costs grew 70 percent, while inflation grew some 23 percent, a growth rate of roughly three times this inflation figure.

During this same time period, private-sector job growth was 0 percent. That's right, zilch!

This problem is also graphically illustrated in education finance policy. While Vermonters' incomes rose only 13 percent between 2005 and 2009, education property taxes rose 35 percent. Spending for K-12 education rose 23 percent, 200 percent over the rate of inflation. Even more frightening is this: over the next 20 years, Vermont faces billions of dollars in unfunded budget expenditures -- approximately $3.5 billion. The largest segments of these are made up of road and bridge repair, water system maintenance and upgrades, bonded debt and Medicaid shortfalls.

This $3.5 billion figure does not include $1.6 billion in unfunded teacher and state employee medical liabilities, nor does it include $466 million in unfunded pension liabilities.

"We have not saved and invested enough for road and bridge infrastructure or for retirees' pensions and health care," Licata said. "We've dug an enormous hole, and it's going to take a lot of work to get out of it." Especially since our fiscal rope is badly fraying. Most money for the general fund comes from income and sales taxes, Licata explained.

These revenues are shrinking as people lose jobs, investment income falls and a belt-tightening public consumes fewer goods and services. Also worrisome is the uneven distribution of tax liability -- about 5 percent of Vermont's tax filers pay about 50 percent of total income taxes. Redistributionists might applaud that figure, but remember this -- upper-income earners have the most resources and reasons to leave the state. If even a quarter decided to do so, Vermont's tax base would be devastated. Replacing these disappearing taxpayers from within seems unlikely.

Just prior to our recession, the state experienced no private sector job growth over this last decade. Since 2000, we have lost more than 10,000 manufacturing jobs while public sector jobs in health and education have increased by almost as much. Many of these jobs, of course, are sustained through tax revenue rather than privately generated wealth. Sadly, we are losing our young people at a rate of four times the national average.

Meanwhile, the number of retirees living within the state is expected to double over the next 25 years. The lack of revenue diversification is also illustrated in our reliance on federal government aid, which accounts for some 30 percent of our total budget. This kind of concentration of risk should keep those in Montpelier up at night, especially in light of our federal government's fiscal woes.

Next month Licata will be making his presentation to the Vermont Legislature in front of members of the House Ways and Means Committee and others.

Among other solutions, he will recommend spending limits and fiscal analysis of key legislation. He will also advocate for policy that creates a better atmosphere for creating jobs and thus expanding the tax base.

If you think your Vermont representatives need to hear this you might want to encourage them to be in Room 11 of the Statehouse on Jan. 6 at 2:30 p.m. for Licata's presentation. It's time our legislators get the facts and start using them in making decisions that affect us all.

The War on the truth... I mean Poverty

Helping to solve poverty, one statistic at a time.

With the economy tanking and unemployment on the rise, Washington has taken a decisive step to combating the rising number of people who officially live at or below the poverty line. As you probably know, the Federal Government claims that a person is living in poverty if they make either at little less than $11,000 per year for single people or $21,000 a year if they are a family of four. While these numbers are not realistic or based upon any meaningful data about who much it costs to live, it is the number that the Government uses to assign benefits. In previous years the number of poor people in America ranges around 10%, a shocking figure for a nation of plenty. But as wages fall or remain stagnant and with more American’s finding themselves out of a job, this percentage will most certainly grow. Therefore, the powers that be have come upon an immediate remedy for the growing number of people who are considered poor, lower the poverty line!

Yes, that’s right. In an almost unbelievable move the Federal Government will be changing the amount of a person’s income it considers to be at the poverty line. They will lower it to an unspecified amount that will be announced early next year. Not since the Reagan Administration declared ketchup a vegetable has such an incredible bit of stupidity ever been attempted by our anointed leaders. This bit of Stalinesque number crunching can’t be interpreted as anything else than an attempt to hide the true state of this economy and avoid the on-coming train wreck if promised “entitlement” benefits were actually paid to those who were originally intended to be their beneficiaries. Given the amount of real inflation in the economy, one would have expected at least an upward modification of the number.

Though no fan of the governmental dole, this changes seems to come right out 1984 and can not be a good sign for the economy. The announced reasons for the change are hardly worth repeating and clearly only a screen. However, given the size of our national debt, the on-coming governmental health care disaster, and the rising tide of “entitled” people, this move is a callous and dishonest play to limit their financial exposure while never addressing the central problem that the promises of a social safety net creates.

Yet, this maneuver seems to be one of several, propaganda tricks that Washington has been pulling the last few weeks. As an example, we are told that the Banks are paying back the TARP funds because they no longer need them and credit is freeing up. Only later do we hear that the President called the Banks to the carpet and demanded they make loans (I.e. There is still a credit crunch for the average consumer). Or that the Swine Flu vaccination effort was a success, but then we find out that a good portion of the vaccines were either too weak or administered wrong. Not to mention that the death rate is comparable to the regular flu thereby raising the question as to why the government spent millions of dollars on a vaccine that may not have been needed or effective. Overall, Washington seems to work overtime to remind me of an old Oscar Wilde quip: “There are lies, damn lies, and statistics”.

Another Chapter in the Annals of Government in the Land of Oz.

This weekend, without much fanfare or coverage from the media, one of the most popular bills before the House of Representatives was given the “Washington as usual” treatment. This treatment resulted in a very good and needed bill being tied to a horrible and counter-productive piece of legislation, thereby effectively killing it while providing political cover for those who do not want effective control over the Federal Reserve Bank. First a quick overview of the facts.

The Audit the Fed bill (HR 1207) was a plain, simple and popular piece of legislation meant to hold the secretive Federal Reserve Bank up to scrutiny for its past and recent actions with tax payer dollars. This bill was so popular that the public outcry for the bill caused every Republican Representative and a good number of Democrats to co-sponsor the bill. In total, this bill had 313 co-sponsors, enough to assure passage. The sponsors, in order to drum up more support and to get a wider audience for its central premise (that the Fed Bank had a lot to answer for) allowed the bill to pass through Rep. Barney Frank’s Committee on Finance, a brave move on their part. Despite a blatant attempt to gut the bill by some Democrats on the Committee, it passed the first major test of the Committee (the mark up). However, this would be the high point for this bill.

For you see that Committee Chair Frank also had another bill regarding the Federal Reserve Bank which was meant to create yet another agency to oversee our financial institutions and would expand the powers of the Fed Bank. As is his prerogative, Chairman Frank added HR 1207 as an amendment to this bill. As a result, every Republican voted against HR 1207, including Ron Paul, as it was part of a incredibly bad piece of legislation, while the Democrats got to vote for it. Meanwhile, over in the Senate, the members are ready to either remove HR 1207 completely or pass it with significant changes. The Companion Bill to HR1207, S.604, languishes in committee with only 30 or so sponsors and no hope of a floor vote, much less passage. If the bill just passed contains enough of HR 1207 coming out of the Senate or Conference Committee, the hopes of reviving the core ideas behind HR 1207 die with this bill. Additionally, Judd Gregg, Republican Senator from New Hampshire, has come out to say that he would filibuster any legislation like HR 1207.

This sad conclusion to our popular effort is an object lesson for us all. Even clear, popular and timely legislation doesn’t stand a chance in the current government we have. Washington appears more detached and further away than ever. The Byzantine ways of our Congress/political establishment has insured that the American People will never learn the truth about what’s going on inside this private, secret, all powerful bank. Our Congressional Delegation now enjoys the political cover of supporting HR 1207, but never really having to pass it. The many voices of citizens from around the country were drowned out by the hum of the business as usual machine in Washington.

But does this mean that we should lose heart? Should we give up? No, and a thousand times no! Instead, it clarifies something we have been saying for a long time, but have not heard ourselves. Washington is the problem, not the solution. Until we change how we see Washington’s role in our lives, Washington will not change. While Pat, Peter, and Bernie can stay snug in their governmental cocoons oblivious to our cries, we have at our finger tips another way.
For change to occur in Washington, it has to start in Montpelier. We can’t camp out on the doorstep of Mr. Leahy’s, Welch’s and Sander’s Offices, but we can make our presence know in Montpelier and with our local representatives. We may not be a player at the tables of the powerful along the Potomac, but we have the power of proximity with our elected representatives in Montpelier. The change I speak about is not cosmetic or simply a question of personnel occupying an office, it is a sea change of expectations, ideas, and political atmosphere. Not just talking about legislation, but whether such legislation is required or appropriate. Not just talking about responsive representatives in Montpelier, but representatives who understand the appropriate role of government. Not just changing the attitude in Montpelier, but the attitude of all Vermonters, away from “let government do it” to “let's make it happen.” In all, instead of continuing the well-worn hobby of Washington, issue chasing, we must start a new, different effort toward enforcing and support fundamental principles that made this nation and state great. The first step, is to demand them at home, before we try them in the Land of Political Oz.

The Gray Mountain State

As longtime readers know, the Demographic Deathwatch is not a novelty dance craze but a recurring feature of this column. But it’s not just for Europe, Russia, China, and Japan anymore! Some parts of America are acquiring demographic profiles that would qualify them for EU membership.

Take the Green Mountain State. As Howard Dean was fond of saying during his 2004 presidential campaign, “Vermont is the way America ought to be.”

If it is, we’re all done for. Its marquee brands are either Canadian-owned (Vermont Castings wood stoves) or European-owned (Ben & Jerry’s ice cream) and any non-foreign economic activity in the state long ago had any life regulated out of it.

But never mind all that. I ventured across the Connecticut River the other day and picked up the local paper, the Journal Opinion of Bradford, Vt. And among the other front-page headlines (“Newbury Will Mail Town Reports”; “Upcoming Sand Pile Talk”) was a story on how local school districts were in merger talks. No underlying reason was immediately given for the suddenly pressing need to merge: It seemed to be accepted as a natural feature of life that you can’t do anything about. And then a gazillion paragraphs into the story, the reporter finally explained what was going on: Throughout Vermont, student enrollment at public elementary and secondary schools is declining. According to figures from the state’s Department of Education, there were 104,559 students at those schools during the 1999–2000 school year. Last year, that figure was down to 92,572. Which is quite a drop. In fact, Vermont school enrollments have declined 13 years in a row. Since 1996, they’ve fallen by 13 percent, slumping below 100,000 in 2004 and projected to fall below 90,000 in 2014. The part of the state that my corner of New Hampshire borders is admittedly rural, and it’s not an unusual phenomenon for small towns to drain population to the big cities. But a couple of days later I was in the capital, Montpelier, and its school board is in merger talks with the neighboring towns of Berlin and Calais.

If schoolkids are thin on the ground, the state’s total population has held steady — 604,000 in 1999, 621,000 today. So Vermont is getting proportionately more childless. Which is to say that Vermont, literally, has no future. One school-board member whose enrollment has bumped from 600 to 500 and is now heading down to 400 told the paper: “What are we going to do? We’re not holding our breath that the state is going to solve this problem.”

I suppose by “the state” he means the department of education or, in a more general way, Montpelier. But in a very basic sense there is no “state”: Graying ponytailed hippies and chichi gay couples aren’t enough of a population base to run a functioning jurisdiction. To modify Howard Dean, Vermont is the way liberals think America ought to be, and you can’t make a living in it. So if you’re a cash-poor but land-rich native Vermonter taxed and regulated and hedged in on every front, you face a choice: In the new North Country folk wisdom, they won’t let you fish, so you might as well cut bait. Your outhouse is in breach of zoning regulations, so you might as well get off the pot. Etc. When he ran for president, Howard Dean was said to have inspired America’s youth. In Vermont, he mainly inspired them to move somewhere else. The number of young adults fell by 20 percent during the Dean years. And what’s left is a demographic disaster: The state’s women have the second lowest birthrate in the nation, and the state’s workforce is already America’s oldest. Last year, Chris Lafakis of Moody’s predicted Vermont would have “a really stagnant economy” not this year or this half-decade but for the next 30 years.

True, more gays appear to have moved in. In European terms, homosexuals are Vermont’s Muslims — no disrespect to either party, I hasten to add, before you press that fatwa button. And gay second-homers still require enough of a local populace to generate a scenic plaid-clad coot or two chewing tobaccy on the porch of a still-operating general store: It’s kind of a downer to drive past a bunch of abandoned farms and collapsed barns en route to your weekend pad.

Nowhere in the news reports of school-merger talks does anyone suggest trying to reverse the policies that drive out young families and make Vermont — what’s the word the eco-types dig? — “unsustainable.” When it comes to “climate change,” it’s taken for granted that we can transform the very heavens if only we cap’n’trade’n’tax’n’regulate you even more.

But the demographic death spiral? That’s just a fact of life, to question which puts you beyond political viability. The new Vermont prefers poseur politics and solutions for non-problems. A couple of years back, Gov. Jim Douglas, one of those famously moderate GOP New Englanders, finally noticed something was wrong in Green Mountain schoolhouses. So he acted decisively, signing legislation to protect the environment by forbidding school buses to run their engines while waiting for children to board.

Tough on the kids: On many buses, there are too few students to generate much in the way of body heat. But you’ve gotta be able to prioritize: “This is a great step forward for our state,” declared the governor. The wheels are coming off the Vermont bus, but at least its engine won’t be running as the thing falls apart.

Mark Steyn