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Conversation Hearts Might Bring Mixed Feelings for Taxpayers this Valentine’s Day
Posted By: Douglas Kellogg - 02/14/14

hearts

It’s Valentine’s Day! Love is in the air, but taxpayers may not be feeling it after a year of reckless spending policies and more big government. Yet, as we pass around the “conversation hearts” this year, some of the fuzzy feelings they express might remind taxpayers of a few positives, though others could spark different emotions…

You Rock!

A number of states have cut taxes, or are looking to do so! Sure the federal government has broken taxpayers’ hearts this year, but states like North Carolina have cut taxes, and others like Wisconsin, Nebraska, and even New York are seeking tax reform.

Hug Me

Hold on to your free Internet and dynamic e-commerce tonight. Big retailers and uncompetitive, high-tax, states are trying to tear this love apart – but don’t give up, it’s worth fighting for!

Be Mine

The Balanced Budget Amendment (BBA) movement has continued to make progress through the states, as now Ohio’s recent passage of an Article V referendum makes 20 states who are on board with a convention to pass a BBA. Since the federal government is apparently not interested, taxpayers’ will have to walk a different road to reach this fiscal soul mate.

Miss You

The list of things taxpayers might be longing for could potentially go on for eternity. Some of the most notable lost loves could be lower federal tax rates (on income, and payroll taxes), a more stable dollar and lower Consumer Price Index, non-government controlled healthcare and not being forced by the government to buy something, and jobs.

UR Cool or UR Hot

Depending on where you live, energy might be warming you up or keeping you cool, either way the growth of domestic energy production has been a good thing for taxpayers. So far, punitive taxes sought by the President and others have not stopped this party – however, this electric partner could be powered down if Congress flips the wrong switch.

Taxpayers may have loved and lost, but hope is still alive for the hopeless romantics who won’t give up on a brighter fiscal future!

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NTU Study on Water, Sewer Bidding Leaves Critics All Wet
Posted By: Pete Sepp - 02/11/14

After nearly 45 years on the job protecting taxpayers, NTU has encountered several eternal truths in politics, one of which is: if you rile up entrenched interests enough to lash out against you, you’re likely succeeding. So it is with an article in a recent edition of the journal published by the prestigious American Water Works Association (a group representing professionals of many disciplines in the water and wastewater sector).

It all began with a four-paragraph mention in AWWA’s September 2013 journal (subscription-based) outlining the main findings of NTU’s report, Reforming Our Nation’s Approach to the Infrastructure Crisis. There we recommended a more transparent, accountable, and fiscally responsible system of management for the nation’s water and sewer systems, which included more life-cycle cost analysis and competitive bidding in selection of piping materials.

Apparently that article yanked one chain too many, so to speak. The November 2013 journal contained a “Perspective” from AWWA’s Kenneth Mercer that claimed a “review” of NTU’s report “confirmed” the “concerned responses from some Journal readers who claimed it presented an incomplete picture in advocating for one pipe material over another.” The article actually makes many points with which NTU would agree; yet, its implication of bias was something we had to answer.

But before we could do that, we needed another answer – whether AWWA’s journal would print our response – and it was a polite “no.” Fortunately, Government Bytes is willing to provide a forum instead. Here in its entirety is the text of our response which AWWA did not print:

“December 17, 2013

To the Editor:

The reaction from an unidentified number of AWWA Journal readers (as well as the Journal itself) to National Taxpayers Union’s (NTU’s) report, “Reforming Our Nation’s Approach to the Infrastructure Crisis,” only illustrates NTU’s point: industry interests should avoid entrenching themselves in positions that are too deeply rooted to fear and orthodoxy (“Choosing the Right Pipe,” November 2013). The information we presented demonstrates that there are better strategies to attacking the $1 trillion liability that AWWA itself has identified in its “Buried No Longer” report.

The original article that prompted Mr. Mercer’s response (from the September 2013 Journal) actually cited not only a study from NTU, which has 362,000 members nationwide, but also a report from the U.S. Mayors Water Council,  which represents all mayors of cities over a population of 30,000.  These are diverse voices, but they are speaking from one common source: they’re using AWWA’s pipe data and cost data.

So why should AWWA, which highlighted this trillion-dollar liability in the first place, be surprised that a nationally-known organization would offer more cost-effective solutions than the federally-funded infrastructure bank that AWWA seems to prefer? How does this possibly answer the two major problems behind the future cost spiral, that pipes are failing from corrosion rather than age, and pipe thicknesses for DI are declining?

 

We sought some constructive answers. That’s why both NTU and the Mayors Water Council reports use the comparison of the two leading water pipes as examples, and then applied open procurement, asset management practices and financial analysis to recommend reforms.  

For the record, NTU is not involved in this issue to take sides within an industry. AWWA may represent a collective of water utilities, but in the case of public water systems, the “owners” (rate payers and taxpayers) are on the hook for all utility financial management decisions, including pipes. That’s why we’re engaging on this and other infrastructure issues at every level, every day.

In fact, AWWA’s “review” of our report, which essentially accuses NTU of being biased in favor of one pipe material, seems to have skipped over an important detail – the language of the report itself. Namely, the following, balanced assessment from the author:

The issue at hand is not really the selection of one pipe over another, but the ability for a utility to take advantage of all materials, processes, technologies and products that create the  most cost-effective solution while meeting sustainable performance goals. In fact, every pipe has its best use, but no single pipe is best in every situation. Open competition …will really reach the objectives of elected officials, rate payers and developers concerned with the rising costs of water infrastructure capital programs.

If we as a nation are to address the very real challenges facing water and sewer system replacements, organizations like AWWA need to lead the way by providing an open forum to discuss issues such as optimal consultative procedures for pipe selection; or, how the concepts of longevity and reliability are affected by corrosion and water main breaks; or, why AWWA standards and the National Association of Corrosion Engineers (NACE) are in disagreement over wrapping iron pipe in plastic.

In the absence of this vital dialogue, organizations like my own have to step in and develop a set of criteria, such as the 25-part “Yardstick” that utility rate payers can use to interact with elected officials. Journal readers deserve to know about all of them, but here are just five of those points:

8. Does the utility consider sustainability policies and life-cycle costs in the procurement process?

12. Has every fee and charge been reviewed as to its accuracy in the last 3 years?

16. Does the utility use a computerized maintenance management system (CMMS) to schedule all work orders?

21. Does the utility track and forecast the affordability impacts of current and future rate increases for each major demographic group within the utility’s boundaries?

24. Has the utility posted information pertaining to capital improvement plans, master plans, mitigation studies, cost-of-service studies, allocation studies, asset management issues, fee structures, and other key documents of interest to rate payers in an easy-to-understand format on the Internet? 

Who can argue with principles like these? Hopefully, no one who reads AWWA Journal. After all, even underground, there ought to be a way to reach common ground.”

Perhaps this blog post will be a start in the direction of that “common ground.”

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Does "Progress" Always Have to Mean Attacking Job Creation?
Posted By: Pete Sepp - 02/11/14

In the paradoxical category, a new but also not-so-new article from Center for American Progress calls - again - for discriminatory tax policies toward oil and gas companies.

That CAP is attacking the energy sector is no surprise - they release a piece of this nature each time quarterly corporate earnings are published. But it's important to acknowledge the contributions in jobs, retirees' investment returns, and yes, government revenues, that the energy sector is already making now. Implications that the industry doesn't carry its fair share of the tax burden undermine the formulation of effective energy and tax policy. Our recent infographic effectively shows the real story of the industry's economic contribution and tax burden.

Is it just a coincidence that this comes on the heels of the President's call for tax hikes on energy during his State of the Union?

Read more about the need to reform the corporate tax code for all, and end the government's trend of picking winners and losers, in my recent U.S. News & World Report piece.

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What Will it Take for Taxpayers to get a Modicum of Fiscal Responsibility on the Hill?
Posted By: Douglas Kellogg - 02/11/14

Seemingly right after the “sequester” spending caps were scrapped in the end-of-year budget agreement, we have the House passing a “clean” debt ceiling increase – rather than one with spending reductions to offset the additional debt.

Let’s be clear about how significant this is… In 2011 the first big fight over the debt ceiling led to the Budget Control act, and the aforementioned spending caps. This was not ideal in light of the rapid increase in federal spending we saw in 2009-10 (and the general rise during the preceding decade). However, it was the only tangible example of spending restraint America had seen in over a decade!

Now, this current Congress has effectively gotten rid of those spending cuts, and now raised the debt ceiling without any real attempt at attaching budget reductions, in a span of under three months.

Yes, it’s hard dealing with a party who has majority control and remains obstinate toward any fiscal discipline (outside of some defense savings). Which means it’s probably a good idea to value whatever spending cuts you get out of them, rather than throw them away.

NTU’s Vice President Brandon Arnold explained in The Hill last week how to proceed with a debt ceiling deal that included savings, citing U.S. PIRG and NTU’s latest joint report with $500 billion in bipartisan cut options.

Working for fiscal responsibility is no doubt difficult, but it’s best for the country.

The easy option of throwing America’s current and future taxpayers to the debt dogs is a temporary Washington solution, or more accurately, a passing of the problem on to someone else. 

Unless Senator Obama from 2006 shows up, it looks like tonight’s vote means the debt ceiling is going up with little resistance once again – and right after that same Congress undermined the last victory for taxpayers on this issue.

“The fact that we are here today to debate raising America's debt limit is a sign of leadership failure. It is a sign that the U.S. Government can't pay its own bills. It is a sign that we now depend on ongoing financial assistance from foreign countries to finance our Government's reckless fiscal policies.” 

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State Action Heats Up & Obamacare Liberates 1.3 Million from Work - Speaking of Taxpayers, Feb. 7, 2014
Posted By: Douglas Kellogg - 02/10/14

Subscribe to NTU's podcast Speaking of Taxpayers via iTunes.

1.3 to 1.5 million Americans will lose work hours, jobs, or never get them, according to a new CBO report on Obamacare. NTU State Affairs Manager Lee Schalk has a big update on the states, with BBA news, unemployment insurance, and more. Plus, NTUF's Demian Brady talks budget, and the Outrage of the Week!

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Latest Taxpayer's Tab: CBO's Economic Outlook
Posted By: Michael Tasselmyer - 02/09/14

Tab Insert

The Congressional Budget Office (CBO) released its annual Budget and Economic Outlook report this week, and their projections for the next ten years won't inspire much confidence for those concerned with the country's debt and deficits. In the latest edition of The Taxpayer's Tab, NTUF delves into the CBO's report and offers an analysis of the long-term trends they predict, which include steadily increasing deficits after next year and a publicly-held debt topping 79 percent of GDP by the end of the next decade.

Also featured this week:

  • Most Expensive: Senator Tammy Baldwin (D-WI) introduced the Small Business Innovation Act of 2013. S. 1285 would provide $1 billion over the next five years ($200 million annually) to various financial stimulus programs within the Small Business Administration.
  • Least Expensive: Senator Dean Heller (R-NV) introduced the Steps Toward Access and Reform (STAR) Act of 2013 in order to reform the current medical malpractice system. S. 1860 would save $18 billion over the next five years by capping the amount that doctors can be sued for over noneconomic damages and limiting the timeframe during which a lawsuit can be filed.
  • Most Friended: In order to address concerns over whether Healthcare.gov offers adequate protection of users' personal information, Congressman Joseph Pitts (R-PA) drafted the Health Exchange Security and Transparency Act of 2014. H.R. 3811 would require the Department of Health and Human Services to notify users of any security breach within two days.

The full issue, with more information on these bills and the CBO report, is available online.

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(VIDEO) What's Government Up To This Week?
Posted By: Douglas Kellogg - 02/04/14

The first in a new weekly video series from your friends at National Taxpayers Union! We'll keep you updated on what's really going in in Washington, and the issues that will affect your pocketbook.

NTU Federal Affairs Manager Nan Swift talks about the farm bill and debt ceiling action in the U.S. Senate, both of which put billions of your dollars on the line.

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Three Graphs That Put The Recovery In Perspective
Posted By: Michael Tasselmyer - 02/04/14

Today, the Congressional Budget Office (CBO) released multiple reports on the state of the U.S. economy. One of them, "The Slow Recovery of the Labor Market," examines current job market conditions and projects where employment figures are heading relative to historical trends. The full report is available online, but here are three quick take-aways summed up in graphical form (visuals courtesy of CBO):

  • The economy is taking much longer to recover than it has after past recessions. Consumers are still hesitant to buy as many goods and services as they did before the downturn, which means employers aren't in any rush to hire.

cbo-2014-econ-recovery-employment

  • People will choose to work less. Aging will contribute to lower labor force participation, but federal tax and spending policies will also motivate many people to work less than they otherwise would. Specifically, CBO cites the current tax code, as well as the Affordable Care Act (ACA): "[B]y providing subsidies that decline with rising income (and increase with falling income) and by making some people financially better off, the ACA will create an incentive for some people to choose to work less." On that point, CBO has estimated that the ACA will reduce the number of full-time employees by over 2 million over the next few years, with the largest impact being felt among low-wage workers.
cbo-2014-econ-recovery-participation
  • Less of the population will be working at all over the next decade. According to CBO, to get back to pre-recession unemployment of five percent, 3 million people currently looking for work would need to find jobs. In 2006, just before the recession, the employment-to-population ratio was at 63.3 percent. By 2018, that could fall to 58.9 percent.

cbo-2014-econ-recovery-population

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Whoever Said “Talk is Cheap”? A State of the Union Analysis - Speaking of Taxpayers, Jan. 31 (AUDIO)
Posted By: Dan Barrett - 02/03/14

$40 BILLION is the cost of President Obama's State of the Union, and that's just what can be quantified - NTUF's Demian Brady explains. Plus, Pete talks Obama's hypocrisy on energy; and the Outrage of the Week goes to the Super Bowl (sort of)! 

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Troubling Contradictions: Obama on Energy Taxes in his State of the Union
Posted By: Pete Sepp - 01/31/14

In the President’s address Tuesday night, sharp-eared observers might have noticed he took credit for growth spurred by the oil and gas industry, saying:


“And here are the results of your efforts: … A manufacturing sector that's adding jobs for the first time since the 1990s -- more oil produced -- more oil produced at home than we buy from the rest of the world, the first time that's happened in nearly twenty years.”


The President’s excitement over the accomplishments of the energy sector might come as a surprise considering he has consistently worked to make life more difficult for those businesses.


Now, he is taking credit for a natural gas boom that the EPA nearly strangled in its infancy and rather than let the private sector drive it further, he wants subsidized fueling facilities at a cost to taxpayers of $274 million annually.


What made his remarks on this during the State of the Union so startling, was that 15 minutes after this boast – the President (not for the first time) called for massive tax hikes on the industry whose accomplishments he just touted!


“Let's continue that progress with a smarter tax policy that stops giving $4 billion a year to fossil fuel industries that don't need it so we can invest more in fuels of the future that do.”


The language itself is galling, as if the government created the wealth being discussed and “gives” it away because the tax code isn’t more punitive. But more specifically this short line in a speech means the continued success of a rare economic bright spot could be in jeopardy…


Given the President’s citation of the $4 billion a year number, he is apparently referencing several tired schemes to single out oil and gas for harsh treatment – including repeal of a write-off for taxes paid to foreign governments and a job creation deduction available to numerous other industries. We’ll likely also see a pitch for more “green” energy subsidies in coming weeks.


His stance further endangers the systemic tax reform process, which is building bipartisan steam in Congress. Commendably, the President called for a comprehensive overhaul of the tax laws, one that emphasizes lower rates and a simplified base. Yet, he also proposed to “take the money we save from this transition” and plow it into more government projects.


The notion that the Treasury “saves” money by taking it from the private sector is problematic. Plus, targeting oil and gas would make the Tax Code more, not less, complex.


Obama is acting as if he can continue proposing the very policies that would have killed America’s energy renaissance, and still have economic gains to falsely take credit for the next time he makes such an address.

The trouble is, sending signals like these can do damage, not only to the economy but the cause of tax reform too … and, most ironically, to the Treasury’s bottom line.

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