Have nothing to do with the [evil] things that people do, things that belong to the darkness. Instead, bring them out to the light... [For] when all things are brought out into the light, then their true nature is clearly revealed...

-Ephesians 5:11-13

Tag Archives: growth

Mercedes-Benz Latest to Leave New Jersey Owing to High Taxes

This article first appeared online at TheNewAmerican.com on Thursday, January 8, 2015:

Mercedes-Benz HighPerformanceEngines

The rumors swirling around the Mercedes-Benz headquarters in Montvale, New Jersey were confirmed by the company’s U.S. president, Stephen Cannon, on Tuesday: It would move its U.S. headquarters from Montvale to Atlanta, starting in July. The move would affect about 1,000 employees, about half of whom would likely be offered the opportunity to move with the company.

The decision to move was based on the high-cost and high-tax environment in New Jersey compared to Georgia, although one had to read between the lines of the company’s official statement to ferret that out:

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Underlying Economic Indicators Confirm Dow’s Record Run

This article first appeared online at TheNewAmerican.com on Wednesday, December 24, 2014:

 

With the Santa Claus rally driving stocks to new all-time highs, the normally restrained Wall Street Journal found itself describing the economy “in a sweet spot of growth, sustained hiring and falling unemployment, stirring optimism that a post-recession breakout has arrived.”

Investopedia explains the cause of the usual rally in stocks toward the end of each year this way:

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Pressure Building to Repeal Two Laws Keeping Oil and Gas Prices High

This article first appeared at TheNewAmerican.com on Monday, November 17, 2014:

Senator Lisa Murkowski

Alaska Senator Lisa Murkowski

Alaskan Republican Senator Lisa Murkowski, soon to chair the Senate Committee on Energy and Natural Resources, is already setting the table for a serious conversation about getting rid of at least one archaic law dating back to the mid-1970s: the Energy Policy and Conservation Act of 1975.

That law bans the export of crude oil (with some minor exceptions) and could endanger the oil shale boom as a result. Said Murkowski:

The price American drivers pay for gasoline at their local station is linked to the price of oil set by the global market.

 

Exporting U.S. oil to our friends and allies will not raise gasoline prices here at home and should, in fact, help drive down prices.

As the price of crude oil drops, it increases the chances that smaller marginal crude oil producers will be forced to close unless they are allowed to find buyers outside the United States willing to pay more for their product. One of the bottlenecks has already been opened:

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House Votes to Approve Keystone, for Ninth Time

This article first appeared at TheNewAmerican.com on Monday, November 17, 2014:

Keystone XL demonstration, White House,8-23-20...

Keystone XL demonstration

In the first major vote in the House during the current lame duck session, on Friday a bill to approve the Keystone XL Pipeline passed by a vote of 252-161. In an ironic twist, the bill — the ninth one approving Keystone — was sponsored by Rep. Bill Cassidy, the Louisiana Republican facing Democrat Senator Mary Landrieu in a runoff election on December 6. Landrieu has been moving heaven and earth in the Senate to approve Keystone in an attempt to salvage her career.

Said Cassidy:

Here we are on the ninth attempt. It has been 539 days, about a year and a half, since the House first sent a Keystone approval bill to the Senate in this Congress. We are going to make it as easy as possible for the Senate to finally get a bill to president’s desk.

And there it will die, if it makes it that far, as President Obama has repeatedly stated. Which raises the question:

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Relying on a Pizza Ad to End Scott Walker’s Governorship in Wisconsin

This article first appeared at TheNewAmerican.com on Monday, October 20, 2014:

On September 18, 2014, a new TV campaign ad supporting Wisconsin Governor Scott Walker’s reelection bid showed the governor smiling into the camera and saying, “Thanks to our reforms, the average family will have an extra $322 to spend. What are you going to do with your savings?” A number of regular folks then answered: gas up the car, put on new tires, and buy things such as clothes, school supplies, and diapers.

PolitiFact.com looked into Walker’s claims and concluded that he was basically right: The income tax and property tax reductions that he had engineered during his first term would save the average family in Wisconsin somewhere between $330 and $350 a year. Said PolitiFact: “Either way, the figures support [Walker’s] ad’s claim of $322.”

Mary Burke, a member of Madison’s school board and Wisconsin’s former secretary of commerce from 2005 through 2007, decided not to try to refute Walker’s claim but instead to belittle it.

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Fracking Revolution: U.S. Replaces OPEC as World’s “Swing Producer”

This article first appeared at TheNewAmerican.com on Wednesday, October 1, 2014: 

 

After reviewing the numbers from America’s oil and gas patches, Per Magnus Nysveen of Rystad, an international oil consultancy in Norway, declared that the United States is now taking on the role of “swing producer” that used to be played by Saudi Arabia and other members of OPEC, the oil producers’ cartel.

Those numbers are impressive. Fracking technology has led to a 65-percent increase in U.S. crude oil output in just the last six years and, according to Wood Mackenzie,

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Stock Market Gains Failing to Bail Out Pension Plans

This article first appeared at The McAlvany Intelligence Advisor on Friday, September 26, 2014: 

Pension managers’ hopes that investment returns – i.e., pixie dust – would bail them out from their bad assumptions, and keep their plans solvent and fully funded so that they would be able to keep every promise made, have finally crashed on the rocks of reality. Just three months ago, the Center for Retirement Research at Boston College released a study showing that the shortfall between promises and assets to pay them for 25 of the largest public defined-benefit pension plans in the country amounted to more than

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Despite Stock Market Gains, Public Pension Plans Fall Further Behind

This article first appeared at TheNewAmerican.com on Thursday, September 25, 2014:

 

In its latest report on public pension plans, Moody’s announced on Thursday that, despite recent historic gains in the stock market, those plans’ liabilities are increasing even more quickly. Reporting on the 25 largest public defined benefit pension plans in the country, Moody’s Global Credit Research estimates that those plans are now $2 trillion short of where they need to be to pay out all the benefits promised to their beneficiaries. This has occurred despite record gains in the stock market, which,

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The Kansas Referendum on Reagan’s Tax Cut Policies

This article was published at The McAlvany Intelligence Advisor on Wednesday, September 24, 2014:

Big government liberals and high spending politicians have converged on Kansas, seeing an opportunity to discredit not only Ronald Reagan’s tax policies but to get even with the Tea Party, which took out a number of “moderate” Republicans in the state Senate over the last two election cycles.

Gov. Sam Brownback (pictured above), a supporter of less government and lower taxes, was able to ride the conservative wave that resulted in tax reform that not only increased an individual taxpayer’s standard deduction from $4,500 to $5,500 but also

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Will Tax Cuts Rescue Kansas Governor Brownback in November?

This article first appeared at TheNewAmerican.com on Monday, September 22, 2014:

Sam Brownback, member of the United States Senate

Kansas Governor Sam Brownback

Rarely has a governor’s race had such a clear-cut focus. In Kansas, Republican Governor Sam Brownback is facing a strong challenge from Democrat Paul Davis, who is concentrating on Brownback’s tax policies, which were designed to stimulate Kansas’ moribund economy. They’re not working, says Davis, and the tax cuts passed by Brownback 20 months ago need to be repealed to save the Kansas economy and protect government services.

Davis is getting a lot of help from liberals and from moderate Republicans who

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U.S. Tax Code Puts America 32nd Out of 34 Countries

This article was first published by TheNewAmerican.com on Monday, September 15, 2014:

English: Ronald Reagan singing the Tax Reform ...

English: Ronald Reagan signing the Tax Reform Act of 1986 (Photo credit: Wikipedia)

The release of the Tax Foundation’s latest study last week, its “2014 International Tax Competitive Index” (ITCI), gave commentators from the Wall Street Journal to the Independent Women’s Forum plenty to chew on. The foundation’s analysis, based on more than 40 variables across five major categories, concluded that the United States ranked just 32nd out of the 34 countries making up the Organization For Economic Cooperation and Development (OECD).

In their executive summary, the authors of the study noted that

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July BLS Jobs Report: The Sound of One Hand Clapping?

This article was first published at TheNewAmerican.com on Monday, August 4, 2014:

MarketWatch

To Jeffry Bartash, writing for the Wall Street Journal’s MarketWatch, Friday’s jobs report looked awfully good: 209,000 new jobs were added in July and in all the right places: mining, construction, manufacturing, transportation, and warehousing. In addition, there was almost no growth whatsoever in the “government” sector: just 11,000 new jobs were created there last month. This, according to Bartash, means that the economy is on a hot streak, having generated more than 200,000 new jobs every month for the last six months — the first time that has happened since 1997.

Added Bartash:

In the first seven months of 2014 the economy has gained an average of 230,000 jobs. That’s the best stretch of job creation since the [Great Recession] ended in mid-2009 and 19% faster than the pace of hiring in 2013.

End of story? Not quite.

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Tax Cuts of Kansas Already Improving the State’s Economy

This article was first published at TheNewAmerican.com on Monday, July 14, 2014:

Kansas City Skyline 1

Kansas City, Missouri’s Skyline

When Kansas Governor Sam Brownback signed into law the first of several reductions in his state’s income taxes back in May 2012, he wrote:

Our new pro-growth tax policy will be like a shot of adrenaline into the heart of the Kansas economy. It will pave the way to the creation of tens of thousands of new jobs, bring tens of thousands of people to Kansas, and help make our state the best place in America to start and grow a small business.

By cutting the top tax bracket by 25 percent and eliminating taxes on small businesses altogether, he expected great things to happen:

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Gas Prices Ease as U.S. Oil Production Soars

This article was first published by TheNewAmerican.com on Monday, July 7, 2014: 

English: $4.06 Gas Prices, Lewiston, Maine, Cu...

Despite predictions to the contrary, the price of gas over the July 4 weekend dropped by two cents per gallon, confounding seers who were looking at gas approaching $4 a gallon. Those prognosticators were guilty of “straight-line thinking in a curvilinear world” — meaning that since gas this year was 20 cents a gallon more than a year ago, they believed it would continue to go up steadily for the foreseeable future.

With political disruptions in Iraq and Syria seriously reducing their contributions to the world’s oil supplies, one would think that prices would have to go straight up.

One would be wrong.

On July 4, Bank of America reported that U.S. production of crude oil (along with the liquids separated from natural gas) “surpassed all other countries this year with daily output exceeding 11 million barrels [per day] in the first quarter.” Francisco Blanch, BofA’s head of commodities research, told Bloomberg,

The U.S. increase in supply is a very meaningful chunk of oil. The shale boom is playing a key role in the U.S. recovery [from the Great Recession].

If the U.S. didn’t have this energy supply, prices at the pump would be completely unaffordable.

The nearly exponential growth in oil production, thanks to the free market’s invention and development of fracking technology, has put the United States firmly on the path of energy independence. As we become energy independent, disruptions in the supply chain from the Middle East will matter less and less.

Texas and North Dakota — which Professor Mark Perry calls “Saudi Texas” and “Saudi Dakota” respectively — are now producing almost half of all U.S. oil, and would rank as the fifth largest oil producing country as a separate nation. The growth in production is astonishing, according to Perry:

A decade ago the combined conventional crude oil production in the states of Texas and North Dakota … represented less than 21% of total U.S. crude oil output.

By 2008, the combined crude oil output in the two states … were producing one-third of all U.S. crude oil.

In eight out of the last nine months, their combined share exceeded 47% of all U.S. oil.

Perry predicts that it will exceed 50 percent sometime before the end of the year. And that prediction could come back to embarrass him, if the International Energy Agency (IEA) is correct. The IEA is estimating that total U.S. crude oil production (currently at 8.4 million bpd) will continue to soar, exceeding 13 million barrels per day in less than five years. That 50-percent increase in oil production would mean that the United States could be producing nearly 80 percent of its domestic needs for energy, closing in on energy independence.

In the very short run, gas prices will remain higher than they should be, thanks to the disruptions of supply in the Middle East, but with the continuing success of fracking making shale oil deposits now available with current technology, prices may reasonably be expected to decline further over time. Blanch admitted as much to Bloomberg:

The shale production story [in the United States] is bigger than Iraqi production, but it hasn’t made the impact on prices you would expect.

Typically such a large energy [production] growth should bring prices lower but in fact we’re not seeing that because the whole geopolitical situation outside the U.S. is dreadful.

Those involved in capitalizing on the fracking revolution, however, are taking a much longer view. The annual investment in oil and gas development and production hit a record $200 billion this year, one-fifth “of the country’s total private fixed-structure spending for the first time,” said Blanch.

The explosion in the oil patch is doing much to offset the otherwise nearly stagnant economy. In the last 10 years, direct jobs in the patch have almost doubled, while “indirect” jobs that support the industry have almost tripled in that same time period. As Professor Perry noted: “No other sector … has added as many jobs for American workers or made as much of an overall economic contribution to the US economy as the oil and gas sector.”

Citizens often don’t know how well they have it here. At present the average cost of gasoline is $3.69 a gallon for regular. In Norway it’s an astounding $9.79 a gallon, while in Germany it’s $8.50, and in England a gallon of petrol is $8.25.

The only thing that will keep the price of gas from continuing its two-year decline is government, either through restrictions on energy development or through increased taxation. At present about $2.37 of that $3.69 represents the cost of crude oil. Refining costs are about $.45 a gallon, while distribution, marketing costs, and profits (estimated to be between eight and 15 cents per gallon) cost another $.33 a gallon. Taxes (federal and state) take up the balance: $.42 a gallon. Federal excise taxes are $.184 cents a gallon, while state taxes average about $.24 cents a gallon. If gas continues to drop in response to the natural laws of supply and demand (greater supply means greater demand thanks to the lower price), the temptation to raise state and federal excise taxes will become overwhelming.

In Germany, for instance, half the cost of a gallon of gas is due to taxes. In Great Britain the tax take on a gallon of gas is more than 60 percent. In Sweden it’s even higher.

At present, however, the laws of supply and demand are providing an enormous advantage to American drivers compared to their counterparts abroad. And they continue to confound the experts predicting ever higher prices at the pump as well.

A graduate of Cornell University and a former investment advisor, Bob is a regular contributor to The New American magazine and blogs frequently at www.LightFromTheRight.com, primarily on economics and politics. He can be reached at badelmann@thenewamerican.com This email address is being protected from spambots. You need JavaScript enabled to view it. .

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There are Lies, Damned Lies and the Bureau of Labor Statistics

Mark Twain

Cover of Mark Twain

This article first appeared at The McAlvany Intelligence Advisor on Monday, May 5, 2014:

Perhaps the most famous quote regarding statistics comes from Mark Twain: “There are three kinds of lies: lies, damned lies and statistics.” The only trouble is that Mark Twain said it didn’t originate with him: he got it from British Prime Minister Benjamin Disraeli. But historians haven’t been able to find that phrase in any of Disraeli’s writings!

How appropriate is that? One cannot even validate a quote about statistics to prove

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Rosy jobs Report Headline fails to mask Continuing Underlying Weakness

English: CALEXICO, CA, 4-4-07 --- Hundreds of ...

Photo by Michael Raphael (Photo credit: Wikipedia)

The headlines from Friday’s jobs report from the Bureau of Labor Statistics (BLS) were rosy: employment rose by 288,000 (exceeding expectations) while the unemployment rate fell by 0.4 percent to 6.3, just above the rate dating back to September 2008.

The talking heads from the administration looked only at those headlines and took credit for the gains. Jason Furman, chairman of Obama’s Council of Economic Advisors, said

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Pulitzer Prize Award Over NSA Revelations Generates Vitriolic Criticism

The Pulitzer Prize gold medal award 한국어: 퓰리처상 ...

The Pulitzer Prize gold medal award (Photo credit: Wikipedia)

The Washington Post’s Executive Editor Martin Baron anticipated that there would be strong criticism voiced when those opposed to Edward Snowden’s revelations learned of the Pulitzer Prize Committee’s decision to award its prestigious Public Service award to his paper. He may not have estimated the degree and extent and especially the vitriol of that criticism.

Said Baron:

Disclosing the massive expansion of the NSA’s surveillance network absolutely was a public service. In constructing a surveillance system of breathtaking scope and intrusiveness, our government also sharply eroded individual privacy. All of this was done in secret, without public debate…

[Without Edward Snowden’s disclosures] we never would have known how far this country had

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Connecticut Raises its Minimum Wage to $10.10 an Hour

Governor's Agreement With State Employees

Governor’s Agreement With State Employees (Photo credit: CT Senate Democrats)

In a remarkable display of hubris and economic ignorance, Connecticut Governor Dannel Malloy proudly announced on Thursday that his state is the first to raise the minimum wage to $10.10 an hour:

This is just a step in moving people in the right direction.

We will be lifting people out of poverty in the state of Connecticut. Increasing the minimum wage is not just good for workers, it’s also good for business.

What the new law will really do as it is phased in over the next three years is

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Fed Transcripts from 2008 Reveal Experts to be Clueless and Confused

English: President Barack Obama confers with F...

President Barack Obama confers with Federal Reserve Chairman Ben Bernanke following their meeting at the White House. (Photo credit: Wikipedia)

Followers of the Fed have carefully analyzed the 1,865 pages of transcripts it released in February of its eight regularly scheduled meetings and six emergency meetings in 2008 and have concluded that these experts were clueless and unaware of the opening economic abyss yawning before them. Even the New York Times was forced to admit, following its review of the documents, that

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Latest CBO Outlook Ignores Birth Rates and Tipping Points

This article first appeared at The McAlvany Intelligence Advisor on Wednesday, February 5, 2014:

Just reading the headlines, the average citizen is likely to think that now that the deficits are under control Washington can focus on problems elsewhere. The Congressional Budget Office (CBO) estimated in May that the current year’s deficit would come in at $560 billion, half what it was just two years ago. In its report released on Tuesday, it was pleased to note that

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Many of the articles on Light from the Right first appeared on either The New American or the McAlvany Intelligence Advisor.