The Tax Year in Review

(Published in the Mendocino Beacon)

 As 2009 comes to a close, let’s have a fun look back on what the state legislature and Governor Schwarzenegger did to fix the state’s never-ending spending, uh, budget problem.

• February: everyone’s state income tax increased by 0.25%.
• February: the vehicle license fee doubled to 1.15% and the credit for dependents was slashed by two-thirds.
• April: the state sales tax increased a full 1.0% to 8.25%, the highest of any state.
• October: the state begins withholding an additional 10% from everyone’s paycheck but promises to pay it back come April. You may rightfully ask, with what money?
• November: tuition at state universities increasea by 32%.
• December: still time for another tax increase!

Yet problems persist. The Legislative Budget Analyst reported last month that the budget deficit going into next fiscal year stands at $21 Billion. Apparently thinking them unimportant the legislature drastically cut the budgets of the park and court systems. And the state’s unemployment fund is $7.4 Billion in the hole. So, keep this date in mind:

• November, 2010: the next opportunity to halt the destruction of our state by voting for politicians who are fiscally conservative.

 That, by the way, would disqualify almost all incumbents.


John Redding
Mendocino

Capitalism is the Best Company You Ever Worked For

(Published in the American Thinker on February 24, 2009 )

...and Socialism is the Worst.

by John Redding

For which of these two businesses would you like to work?

At Company A your boss is a control freak. There is only one way to get the job done—his way. His micromanages your work and dismisses your ideas. Some co-workers are good at office politics and get bigger raises and faster promotions. The management is more worried internal politics than it is about making good products. You hate getting up in the morning.

Company B is different. Your boss establishes goals and then holds people accountable for their work. He rewards on the basis of contributions, especially innovative ones. He treats everyone with respect. At Company B nearly everyone flourishes and strives to keep customers happy. You look forward to each new day.

Company As is all too real. I worked over 25 years for one until I could stand it no longer. Company B is a rarity. I recently had the good fortune to work for one until a company founder, a closet control freak, seized control of the company. He misled the Board of Directors into ousting the other founder, my mentor. I became expendable.

I have more time these days, enough to pay attention to the debate over which socio-economic system is better for the country, capitalism or socialism? This debate, of which there is surely not enough, has been prompted by the expansion of government under the Obama administration by means of the $787 billion stimulus bill and the pending $410 billion omnibus bill. Through the lens of recent experience I see the question in this way: under which system would a company rather work?

The parallels are not exact but isn’t Company B akin to the free market system and Company A to socialism?

According to the Small Business Administration (SBA), 99.7% of all employers have less than 500 employees. They hire 58 million people, half the private sector work force, and pay 45 percent of the private payroll. If the U.S. was a business, these would be your average employees.

But when it comes to performance many are anything but average. The SBA documents that they have generated about 2/3 of the new jobs in this country. They employee 40% of all high tech workers. Compared to large companies, they produce 13 times more patents per employee.

This performance is possible in a free market system. As in Company B, there is motivation to perform well. Businesses that provide good products and services are handsomely rewarded and sometimes grow into larger, even more successful companies. Think Microsoft and Dell Computer. Secondly, businesses are free to exercise their judgment when it comes managing their company and making important decisions. This is crucial. Good decisions require accurate and detailed information and no one has more of it than the company itself.

And isn’t this what distinguishes Company B and why we like working for them? Employees are given the freedom to use their knowledge and talents and are rewarded when they succeed.

When President Obama signed the $787 billion stimulus bill into law I had the same sinking feeling as when the unscrupulous founder took control. What I saw in the new legislation is what you find in a Company A. Our government is out to nationalize a large swath of our economy after which the micro-managing by Washington will begin. Small businesses will have the rewards of their success taxed away to benefit those who are politically connected, like General Electric and General Motors. If you have ever been passed over for promotions in favor of co-workers whose only talent is for schmoozing the boss, then you know how many business owners feel today.

Whether we are owners or employees, we are now working for a very large Company A otherwise known as the federal government. The sad thing is that in our personal lives we hate working for this type of company.

John Redding is a management and energy expert. He resides in Mendocino, CA.

Breeding Grounds for Terrorism

(Published in the Mendocino Beacon on November 12, 2009)

The tragedy at Fort Hood got me to thinking. Liberal tenets hold that terrorists incubate in poverty, lack of opportunity, poor education, and disenfranchisement before springing forth to wreak violence on society.  Terrorist is too strong a word, sayest the empathetic liberal, because an act of violence is not a choice but an understandable (though deplorable!) consequence of forces beyond the control of any individual living in these circumstances. 

Then let me raise the warning for all liberals to hear. Years of enacting liberal policies by Democrats and Republicans, now reaching culmination under Obama, will soon create in our own country the very conditions that liberals believe lead to acts of violence and terrorism:

• Poverty resulting from a ruined economy and the destruction of personal savings, check.
• Lack of opportunity that results from widespread unemployment and taxation, check.
• Failure of the educational system to provide a proper education, especially when no one can afford private or Catholic schools, check.
• The sense of disenfranchisement that comes from watching the enactment of health care changes that a large majority of Americans don’t want.

Listen up liberals! Please. Don’t be responsible for creating conditions here at home that you say fosters violence and terrorism in other countries.

John Redding

Mendocino CA

Who’s Responsible for this Mess?

(Published in the Mendocino Beacon on July 16, 2009)

The failing economy and job security seemed to be on everyone’s minds this past week. At the gym, I overheard two women lament that their husbands, apparently in the building trades, were informed by their employers that there is no new work for them. A friend from church recently lost his job as a logger and is making ends meeting by doing odd jobs for me and my neighbors. While walking my dog, I met a nice young woman with a six-month old baby whose job at Mendocino Redwood was eliminated. My daughter, who is also a nice young woman, was told by her employer, the California State University, to expect furloughs that would amount to a 10% salary cut. They did promise to pay her remaining salary with cash instead of IOUs so overall she feels that matters could have been worse.

California is bleeding jobs and the evidence is not all anecdotal. On June 23rd, the Milken Institute released a report entitled Manufacturing 2.0: A More Prosperous California that carefully looked at the state of manufacturing in California. The key findings should be of great concern to everyone:

• California is losing a larger share of manufacturing employment overall, high-tech in particular, and at a faster rate compared to neighboring states;
• This is due in part to the burden of an onerous regulatory climate and some of the highest taxes in the United States;
• California has a reputation for being a state that is unfriendly to business, which harms its overall competitiveness.

Years and years of enacting Democrat policies have brought about this train wreck. My daughter, whose vote helps to send Democrats to Sacramento, tells me that she isn’t interested in assigning blame, but in fixing things. We disagree, as usual, because I am, very interested in assigning blame to what caused the problem—how else to change things for the better? And the cause of California’s failing economy and the loss of jobs here in Mendocino are the policies enacted by the Democrats in Sacramento, as typified by their reckless spending.

It doesn’t take a genius to figure this out. Still, contemplate the words of a real genius, Albert Einstein: "We cannot solve our problems with the same thinking we used when we created them." Please, please, please, hold that thought until the next election.

John Redding
Mendocino, CA

Global Warming

(Published in the Mendocino Beacon on November 12, 2009)

Hats off to the roughly 100 people who participated in Mendocino Climate Action Day. They earned my respect for speaking up and taking action on their beliefs. However, they would gain even more respect were they to re-examine the whole issue of global warming. Scientific studies continue to emerge that strongly suggest that there is no CO2-induced global warming. People who base their global warming beliefs on science and a healthy skepticism, should consider the following:

• Global temperatures have not increased since 1999.
• The computer models used by the IPCC to predict temperatures are not able to reproduce historical data. Many climatology scientists have noted that the effect of condensation and cloud formation on temperatures is not well understood and is totally absent in the computer models that predict runaway global temperatures.
• Several studies have compellingly explained climate change in terms of minimal sun spot activities and the cyclic affect of the Pacific Decadal Oscillation. These are true scientific studies based observation, analysis, and peer reviewed results.
• Al Gore, not my idea of a credible scientific source, nonetheless now says that methane, not CO2, is the major problem. I guess the science is not settled after all.

By the way, the paper probably should have identified Susan Nutter as a Democratic Party activist lest readers mistake her for an objective reporter. If I organize a protest against single payer health care, will you allow me to similarly “report” on the event?

John Redding

Mendocino, CA