The Federal Reserve’s Increased Efforts to Hide Bailout Records

Originally posted on FreedomWorks.org.

On Friday, Federal Reserve chairman Ben Bernanke gave a speech claiming that the economy is finally headed on the right track. He stated at the Federal Reserve Bank of Kansas City’s annual economic symposium that “despite this recent slowing, however, it is reasonable to expect some pickup in growth in 2011 and in subsequent years.”

Not so fast. It has become apparent that Ben Bernanke’s economic forecasts are rarely ever correct. Here are just a few quotes showing Ben Bernanke’s oblivion to the looming housing crisis from 2005 to 2007:

July 2005: CNBC announcer Maria Bartiromo: We have so many economists coming on our air and saying oh this is a [housing] bubble and it’s going to burst and this is going to be a real issue for the economy. Some say it could even create a recession at some point. What is the worst case scenario?

Ben Bernanke: I guess I don’t buy your premise. It’s a pretty unlikely possibility… I don’t think it’s going to drive the economy too far from its full employment path though…I’m hopeful and I’m confident in fact that the bank regulators will pay close attention to the kind of loans that are being made and making sure underwriting is done right.

Ben Bernanke, February 2007: Our assessment is that there is not that much indication at this point that sublime mortgage issues have spread into the broader mortgage market which still seems to be healthy and the lending side of that still seems to be healthy.

Ben Bernanke, July 2007: Overall, the US economy appears likely to expand at a moderate pace over the second half of 2007 with growth then strengthening a bit in 2008 to a rate close to the economy’s underlying trend.

Despite Ben Bernanke declaring that the recession was very likely over in September 2009, the recession is far from over and will likely get even worse in 2011. One has to question why the Federal Reserve’s economic forecasts were so wrong. What exactly is the central banking system doing behind closed doors? How large of a part did the Federal Reserve play in the current financial crisis?

Fortunately, the momentum for a true audit of the Federal Reserve is growing. In May, the latest Rasmussen Report shows that 80 percent of Americans support auditing the Fed. The powerful Ben Bernanke opposes such an audit claiming that “making judgments about our policy decisions would effectively be a takeover of policy by the Congress.” Ultimately, the American people should be allowed to make judgments regarding the risks that the Fed took with taxpayers’ money. As the movement for Fed transparency and accountability grows, Ben Bernanke has made every possible effort to hide secretive financial documents.

Late Bloomberg News reporter Mark Pittman requested documents through the Freedom of Information Act (FOIA) pertaining to the Fed’s $2 trillion U.S Loan Program. Despite appeals by the Fed, the court upheld that the Federal Reserve was required to release 231 documents detailing loans to financial firms in 2008. The Fed alleges that disclosing which banks received taxpayer bailouts would stigmatize and hurt borrowing banks by causing “severe and irreparable competitive injury.” The secretive Fed’s message is clear: they would rather protect the secrecy of banks than inform taxpayers on where their money goes.

On Friday, the U.S. Court of Appeals granted the Federal Reserve a 60-day delay to disclose of the court-ordered documents revealing these bailouts made during the financial crisis. The delay which is 30 days shorter than the Fed requested, gives them time to decide whether or not to take their case to the Supreme Court. It’s unfortunate that the court decided to give the Fed more time to hide documents that undeniably should be publicly accessible through the FOIA.

Since the Federal Reserve has likely played a major role in the current financial meltdown, it is dangerous for the central bank to have unchecked power. The Federal Reserve continuously ignored wise advice by Austrian (free market) economists by creating a housing bubble through artificially lowering interest rates and recklessly loaning money to banks that deserved to fail. Let us not ignore Thomas Jefferson’s words:

Banking establishments are more dangerous than standing armies; and that the principle of spending money to be paid by posterity, under the name of funding, is but swindling futurity on a large scale.

Despite the Federal Reserve’s escalated efforts to conceal important documents, the vast majority of Americans support removing the Fed’s cloak of secrecy. Please contact your representatives and tell them to support Ron Paul’s Federal Reserve Transparency Act which will remove all of the Fed’s special audit protections.

ACTUALLY NANCY PELOSI, UNEMPLOYMENT BENEFITS DO NOT CREATE NET NEW JOBS

Originally posted on August 25, 2010 on FreedomWorks’ website.

Last month, Speaker of the House Nancy Pelosi claimed that unemployment benefits “creates jobs faster than almost any other initiative you can name.” PolitiZoid has created an animated video of Nancy Pelosi’s foolish speech on the “stimulus” of unemployment benefits.

Following Nancy Pelosi’s logic, she should be thrilled to hear that the number of first-time filers for unemployment insurance rose to 500,000 last week—the highest in nine months. However, paying more people not to work will not stimulate the economy or create any jobs. As Arthur Laffer explainsin his Wall Street Journal column,

The flaw in their logic is that when it comes to higher unemployment benefits or any other stimulus spending, the resources given to the unemployed have to be taken from someone else….While the unemployed may spend more as a result of higher unemployment benefits, those people from whom the resources are taken will spend less. In an economy, the income effects from a transfer payment always sum to zero. Quite simply, there is no stimulus from higher unemployment benefits.

Unlike the private sector, government is unable to foster economic growth since it does not have any wealth of its own. Nancy Pelosi who claimed that “we could slip back and have another recession” if Congress didn’t pass an unpaid $34 billion unemployment insurance bill, fails to acknowledge the danger of excessive unemployment benefits.

Currently, unemployed American workers can generally collect unemployment benefits for up to 99 weeks—about 2 years. But how much further is Nancy Pelosi willing to extend these unemployment benefits? At what point is enough, enough?

Naturally, humans respond to incentives. As a result of excessive unemployment benefits, people may not be as proactive about searching for jobs or may become pickier on which they jobs they accept.  Even White House economic adviser Larry Summers acknowledges that excessive unemployment insurances will increase the long-term jobless:

Unemployment insurance also extends the time a person stays off the job. Clark and I estimated that the existence of unemployment insurance almost doubles the number of unemployment spells lasting more than three months.

Take for example Denmark whose citizens use to collect unemployment benefits for up to four years. Of course, being laid off from a job is terrible news. Although, it sure lessens the blow to know that the nanny state will provide you generous unemployment benefits for the next four years of your life.

However, in June, Denmark’s government due to a budget crisis revealed that they would be cutting unemployment benefits back to 2 years. Denmark’s unemployment chart below shows how responsive people were to the changes in unemployment benefits:

According to the New York Times,

It shows that between 2005-7, the number of people who got jobs during their four years of benefits — the green line – rose at the beginning before dropping sharply, then spiked as benefits were about to run out, only to plummet after. The red line shows similar behavior in 1998, when Denmark’s benefit period was five years.

Steen Bocian, a chief economist at Danske Bank, asserts that:

it shows that people are not seeking all the jobs they could get, but just the jobs they would like to have.

As expected, Speaker of the House Nancy Pelosi irrationally believes that paying people not to work somehow creates jobs. As shown in Denmark, excessive unemployment benefits give people less incentives to actively search for a job. Be on the lookout for Nancy Pelosi to pass yet another deficit increasing unemployment insurance extension during a Lame Duck Session that will add  billions our unsustainable national debt while not creating net new jobs.

BOEHNER TO OBAMA: FIRE ALL ECONOMIC ADVISERS

Originally posted on August 24, 2010 on FreedomWorks’ website.

Clearly, President Obama’s economic advisers’ policies have failed to produce any signs of economic recovery. A new report shows that 48 out of 50 states have lost jobs since the “stimulus” was enacted in February 2009. According to the report, government employment in Washington DC has increased while private sector jobs have stagnated across the country. Despite the loss of 2.5 million private sector jobs since 2009, the Obama administration continues to tout the “success” of the “stimulus” on their propaganda filled summer tour.

In his speech today, House Minority Leader John Boehner (R-OH) called on Obama to fire all of his economic advisers starting with Treasury Secretary Tim Geithner and White House adviser Larry Summers. Recently, Tim Geithner wrote a New York Times column titled “Welcome to the Recovery.” In his column, he claims that:

the actions we took at its height to stimulate the economy helped arrest the freefall, preventing an even deeper collapse and putting the economy on the road to recovery.

Of course, this is far from the truth. No government in history has ever spent a country into prosperity. On the contrary, government “stimulus” programs have made the economy worse by preventing the growth of the productive private sector. Due to the unpopularity of the “stimulus”, Obama’s economic advisers have purposely removed the word stimulus from their vocabulary. The “stimulus” has been such a disappointment that Obama’s economic advisers now refer to it as the “recovery act.” Whether it’s called the “stimulus” or the “recovery act”, the plan has still likely prevented the creation of 10 million jobs in the private sector.

Minority Leader John Boehner is not alone in his recommendation that Obama should fire his entire economic team. According to Representative Connie Mack (R-FL),

From his questionable role in the AIG bailout to his mishandling of our economic recovery, Secretary Geithner has been a disappointment from the start.

Needless to say, the current state of the economy makes it difficult for anyone to defend the flawed “stimulus.” In fact, Christina Romer recently resigned as Obama’s Chief Economic Advisor midstream into her appointment. Romer was a co-author of a study back in 2009 that claimed that the “stimulus” would keep unemployment below 8 percent. According to the Washington Post,

Christina Romer said Friday that she wishes she could redo one of her first official acts for the president: last January’s forecast that a big shot of federal spending would save millions of jobs and keep the unemployment rate under 8 percent. The forecast was wrong.

Instead, the unemployment rate has remained above 8 percent since February 2009. In late 2009, the unemployment rate reached double digits and has hovered around 10 percent ever since. It’s no wonder that Romer decided to give up her job defending a “stimulus” plan that has failed by its own measure. As House Minority Leader John Boehner said in his speech regarding the resignation of Budget Director Peter Orszag and Christina Romer,

Clearly, they see the writing on the wall, and the president should too.

House Minority Leader John Boehner is correct that America needs a “fresh start.” One solution is to fire Obama’s economic advisers who refuse to admit that the “stimulus” was indeed a colossal failure. Hopefully, Tim Geithner and Larry Summers will be the next to follow in the direction of top economic advisers that have already resigned from the Obama administration. America’s economic policy needs to pursue a new course that focuses on lowering taxes and eliminating harmful regulations instead of repeating the same old “stimulus” economic policy that got us into this deep mess in the first place.

PHILADELPHIA’S GOVERNMENT IMPOSES RESTRICTIONS AND FEES ON BLOGS

Originally posted on August 24, 2010 on FreedomWorks’ website.

Like many cities across the nation, Philadelphia faces a budget crisis due to massive overspending by lawmakers on wasteful projects. In order to make up for their $179 million shortfall, Philadelphia’s government has proposed everything from steep soda taxes to property tax increases. Unfortunately, the city has taken it even one step further by requiring that Philadelphia’s bloggers obtain a $300 business license and pay a “business privileged tax.”

In Philadelphia, most people maintain blogs as a hobby to express their opinions on various issues from politics to local restaurants. With very few exceptions, the required “business privileged tax” exceeds bloggers’ incomes. Marilyn Bess, a local Philadelphian blogger, has made about $50 over the past three years on her green living blog. According to the MS Philly Organic blog owner,

The real kick in the pants is that I don’t even have a full-time job, so for the city to tell me to pony up $300 for a business privilege license, pay wage tax, business privilege tax, net profits tax on a handful of money is outrageous.

A number of people who own small, low-traffic blogs that make no money are receiving letters from the city treasurer claiming that they owe $300 to the government. Any blogger who fails to comply with this imposed hefty tax may face harsh legal consequences.

Since Philadelphia’s government has become no stranger to corruption and waste, blogs have given ordinary citizens the opportunity to speak out against their elected officials. Forcing blog owners to pay more in taxes than they earn would likely shut down grassroots blogs that help hold politicians accountable to citizens. All Philadelphia residents have the right to post their thoughts on the Internet without obtaining a costly government license to do so. Please see Philadelphia’s city council websiteto contact district council members regarding these unprecedented new taxes. Unless we take action to fight these outrageous restrictions on Philadelphia’s blogs, a new bloggers tax may be imposed on a city near you!

CAPITOL COMMENT: 2011 TAX HIKES

Originally posted on August 24, 2010 on FreedomWorks’ website.

To download a PDF of this article, please click here.

Unless Congress takes action, the largest tax hike in American history will occur on January 1, 2011. The series of tax cuts passed in 2001 and 2003 lowered taxes for almost all taxpayers. While the Obama administration claims to be focused on job growth, such a dramatic tax hike will result in higher unemployment.

List of the major tax increases coming in 2011:

Increased Income Tax Rates
•   Currently, all income tax rates are set to increase on January 1, 2011. If passed, President Obama’s 2011 budget would increase the personal income tax rates for the top two tax brackets. As a result, two-thirds of small businesses would be taxed at a rate of 39.6 percent. (1).

Return of the Death Tax—At 55 Percent
•    The Bush-era tax cuts eliminated the death tax entirely in 2010. However, the death tax is scheduled to come back in 2011. All individuals who have personal assets valued at more than $1 million will be taxed at a rate of 55 percent upon his or her death. The return of the death tax will likely put small businesses and family farms out of business that cannot afford to pay for this immoral form of double taxation. (2).

Increased Capital Gains Taxes—To 20 Percent
•     The capital gains tax will rise from 15 to 20 percent. The increased capital gains tax will deter small businesses from creating new jobs. In addition, the capital gains tax discourages investment and punishes Americans who save money for the future.  (3).

Increased Dividends Tax –To 39.6 Percent
•    The dividend tax will rise from 15 to 39.6 percent in 2011. The dividend tax is a form of double taxation since a company has already paid corporate taxes on their profits. As a result, investors are harmed in the process. (4). The dividend tax discourages investment in business which is essential to job growth.

Increased Energy Taxes
•    Various tax cuts will be repealed for companies that produce energy. Since these new taxes will be passed on to consumers in the form of higher prices, expect your energy costs to skyrocket. (5).

Increased Health Care Taxes
•    “The Medicine Cabinet Tax”: Individuals will no longer be able to use pre-taxed dollars in their flexible spending accounts or health savings accounts to purchase over the counter medicines available without a doctor’s prescription.

•    “Brand Name Drug Tax”: ObamaCare will impose a hefty tax on name-brand drug manufacturers. This tax will be passed onto all consumers in the form of higher medicine prices. (6).

On January 1, 2011, the largest tax hike in history will occur. The list above includes only a few of the many tax increases that are expected. The increased taxes on small businesses, family farms, investors, parents and consumers will destroy job creation. During these hard economic times, Congress should be focusing on reducing the tax burden for all Americans in order to restore prosperity and boost job growth. Instead, the scheduled 2011 tax hikes will stifle economic growth while creating widespread uncertainty for small businesses and taxpayers.
1. Ellis, Ryan. “Six Months to Go Until The Largest Tax Hikes in History.” Americans for Tax Reform. 7 July 2010. <http://atr.org/six-months-untilbr-largest-tax-hikes-a5171&gt;

2.  Dubay, Curtis. “Obama’s 2011 Budget Tax Hikes Contradict Focus on Job Creation.” Heritage Foundation. 3 Feb 2010. <http://www.heritage.org/Research/Reports/2010/02/Obamas-2011-Budget-Tax-Hikes-Contradict-Focus-on-Job-Creation&gt;

3.  Laffer, Arthur. “Tax Hikes and the 2011 Economic Collapse.” Wall Street Journal. 6 June 2010. <http://online.wsj.com/article/NA_WSJ_PUB:SB10001424052748704113504575264513748386610.html&gt;

4. Ibid.

5.  Supra.

6. Supra.

HAPPY COST OF GOVERNMENT DAY!

Originally posted on August 19, 2010 on FreedomWorks’ website.

Today, Americans will “celebrate” Cost of Government Day! In 2010, the average American worked until August 19–or 231 days– to earn enough income just to pay for the cost of federal, state and local government. In total, government spending now consumes 63.41 percent of all income in the United States.

Each year, Americans for Tax Reform’s Center for Fiscal Accountability calculates Cost of Government Day. Due to major increases in government spending in 2010, August 19 is the latest Cost of Government Day ever recorded:

The Center for Fiscal Accountability breaks down how many days it takes the average American to pay for different components of government spending:

The Cost of Government Day for each state is based on varying spending burdens.

Those states with the earliest Cost of Government Days:

Alaska- July 28
Louisiana- July 28
Mississippi- July 31
South Dakota- August 2
West Virginia- August 3

Those states with the latest Cost of Government Days:

District of Columbia- August 29
Maryland- September 4
New York- September 10
New Jersey- September 14
Connecticut- September 17

Enjoy the rest of your 134 days this year! Finally, the average American has paid off his or her share of the cost of big government spending.

GOVERNMENT RUN HIGH-SPEED RAILS WILL LIKELY BE A DISASTER

Originally posted on August 19, 2010 on FreedomWorks’ website.

Recently, the Obama administration eagerly spent $8 billion taxpayer dollars to build a high-speed rail system across the nation. According to Vice President “Amtrack Joe” Biden,

We’re making a commitment that is absolutely unprecedented. It is the single best investment of any traveling dollar you can invest in.

President Obama claims that a taxpayer funded high-speed rail will be “faster, cheaper and easier.” Unfortunately, politicians seem to be preoccupied with the “romance of the railways.” We cannot afford to ignore the long term costs of a government subsidized rail system.

For years, government has been subsidizing transportation with no track record of success. Wonder how successful a government high-speed rail system will be? Chances are that we need to look no further than the government failure of Amtrak for the answer. Despite the fact that the majority of trains remain fairly empty, government run Amtrak runs an abundance of trains daily. In fact, Amtrak actually loses money on 41 out of 44 of their train routes. Taxpayers are forced to pay $32 per Amtrak passenger to make up for these losses. Even still, riders often complain about spotty Amtrak service and frequent delays.

According to Cato Institute scholar Tad DeHaven,

Amtrak’s press release brags: ‘Last fiscal year (FY 2009), the railroad carried 27.2 million passengers, making it the second-best year in the company’s history.’ That sounds good until you realize that Amtrak accounts for only 0.1 percent of the nation’s passenger travel. Moreover, Amtrak projected in 1976 that its ridership would grow from 17.3 million in 1975 to 32.9 million by 1980.

Washington continues to reward Amtrak’s repeated failure with increased taxpayer subsidizes. It’s likely that a government high-speed rail system will have the same fate: the trains will cost all taxpayers massive amounts of money while only a very small percentage of Americans will actually ride them.

Simply, the private sector will always outperform any service provided by the government. If high-speed rails are so “needed”, why not allow the private sector to provide these trains? In the private sector, a train company will go out of business if they fail to provide a quality service. Therefore, private trains have more incentives to treat consumers well and run efficiently. Currently, Amtrak and the future high-speed rail system will have no incentives to improve their service. Since these trains are government monopolies with no outside competition, they will receive a taxpayer bailout regardless of the quality of their service. It’s difficult for private companies to compete with government monopolies since they do not have access to guaranteed funds from taxpayers.

Additionally, President Obama claimed that America is “falling behind in high speed rail.” In his speech, he praised Japan’s impressive rail system:

Japan the nation that unveiled the first high speed rail system is already at work building the next. A line that will connect Toyko and Osaka at speeds of over 300 miles per hour…There’s no reason why we can’t do this. This is America.

It is true that Japan’s current bullet trains are incredibly fast, very reliable and have not had one fatal accident in their history. According to the San Francisco Chronicle,

Japan’s high-speed trains run with an efficiency, frequency and reliability unimaginable to those familiar with Amtrak or U.S. commuter railroads.

However, President Obama left out an important fact. Most of Japan’s high-speed rail lines are ran by a private company, The Japan Railways Group. In 1987, Japan’s railroads were privatized due to the failure of the government run Japanese National Railways. Since then, the privatization of Japanese trains has been a huge success. Under the government ran system, Japan’s railways were losing $50 million a day. Since train privatization, three main companies now earn massive profits, ridership has increased and accidents have decreased by over 50 percent. According to Federal Research Division of Library of Congress,

The demise of the government-owned system came after charges of serious management inefficiencies, profit losses, and fraud. By the early 1980s, passenger and freight business had declined, and fare increases failed to keep up with higher labor costs. The new [private] companies introduced competition, cut their staffing, and made reform efforts.

There is no reason that America should not follow Japan’s lead by starting to privatize our rail systems. If intercity passenger high-speed rails make sense, the private sector will invest in these projects. Taxpayers should not be forced to pay for government run high-speed rails that will likely be severely mismanaged. The government run high-speed rail system is yet another project that will add billions to our national debt while not improving the economy.

LOCAL GOVERNMENT BUREAUCRATS EARN NEARLY TWICE PRIVATE SECTOR PER HOUR

Originally posted on August 19, 2010 on FreedomWorks’ website.

The average government employee is needlessly paid significantly more than the average worker in the private sector. In a recent New York Times column, Paul Krugman claims that state and local government bureaucrats deserve to make more than private sector workers,

State and local employees are paid more, on average, than private-sector workers about 13 percent more, according to this analysis by John Schmitt. But as Schmitt shows, that’s an apples and oranges comparison: state and local workers are much better educated and somewhat older than private-sector workers, and once you correct for that the comparison actually seems to go the other way.

In reality, government employees unnecessarily enjoy bloated paychecks. According to the Bureau of Economic Analysis, the average state and local government employee salary is $53,056 compared to private sector workers who average $50,462 annually. At first, this may not seem like a huge difference between their salaries. However, Paul Krugman fails to factor in various other benefits of government employment.

Dr. William Anderson, an economics professor at Frostburg State University, explains Krugman’s logical fallacies in an excellent blog brilliantly titled “Krugman in Wonderland“:

However, as I read Krugman, I have come to realize that he sees absolutely no difference in government spending and private capital expenditures…What I find from Krugman, however, is that he views government spending and taxation as a net plus, but private investment and spending is only a cost.

In Krugman’s recent column, he cites a study from the leftist Center for Economic and Policy Research that claims that educated government bureaucrats are actually “penalized” because of their “low salaries”. Yet, this study also fails to mention additional government benefits and pension plans. The USA Today chart below shows that the average state and local government worker receives 59 percent more in benefits than private sector workers:

According to the U.S Bureau of Labor Statistics, state and local governments are far more likely to offer their workers generous health insurance, retirement benefits, life insurance and paid sick leave compared to private sector employers:

In actuality, state and local government bureaucrats earn 14.5 percent higher annual compensation and earn 45 percent more per hour than private sector workers:

If you add up the numbers, the average public sector employee receives $39.66 an hour and works only 33.9 hours a week to earn $69,913 annually. On the contrary, the average private sector employee receives only $27.42 an hour and works 42.8 hours a week to earn $61,051 annually. Krugman conveniently fails to mention that state and local government employees typically work 8.9 fewer hours a week.

Additionally, private sector workers are three times more likely to get laid off or fired than government employees. Public sector workers are also likely to have significantly better working conditions. In fact, private sector workers quit their jobs at a rate that is eight times higher than government bureaucrats.

On average, public sector workers may have attained slightly more education than private sector workers. After all, taxpayers are often forced to subsidize government bureaucrats’ education costs. However, it is hard to justify that education is solely responsible for the growing gap between government and private sector worker compensation. Since 2000, federal employee wages increased by 36.9 percent while private sector wages rose only 8.8 percent.

One of the main reasons that local and state government are in fiscal trouble is because they pay their employees way too much. Since public sector unions have a large influence on government policy, they are successfully able to lobby for excessively higher pay at the expense of taxpayers. Taking away massive amounts of money from the productive private sector to pay for government bureaucrats’ bloated paychecks has deterred economic growth. It is unsustainable that a growing number of government employees are receiving far greater benefits compared to their private sector counterparts.

LICENSING RESTRICTIONS SHUT DOWN LITTLE GIRL’S LEMONADE STAND

Originally posted on August 10, 2010 on FreedomWorks’ website.

During the hot summer months, it’s practically an American tradition for children to set up lemonade stands in their neighborhood. The children learn valuable skills on how to run a business while earning some extra summer cash. A few years ago, the image of bureaucrats forcibly shutting down innocent lemonade stands may have been satire. Not anymore. The out of control nanny state has targeted all business owners—even if the entrepreneur happens to be a 7 year-old girl selling lemonade.

On July 29, Julie Murphy committed the “heinous crime” of selling lemonade for 50 cents a cup at an arts fair in Portland. Since the young entrepreneur did not have a temporary restaurant license costing $120, the county health inspectors threatened to fine her $500 if she did not leave. Even after offering the lemonade for free and for donation only, the county officials shut down her lemonade stand. While Julie left the fair in tears, hopefully her entrepreneurial spirit was not broken by these harsh government regulations.

According to environmental health supervisor John Kawaguchi,

I understand the reason behind what they’re doing and it’s a neighborhood event, and they’re trying to generate revenue. But we still need to put the public’s health first.

Be forewarned that county officials have the power to shut down children’s lemonade stands even if they are on a private front lawn. Eric Pippert, a manager for the Oregon’s public health claims

the fact that you’re small-scale I don’t think is relevant.

This is just one of countless examples of how needless fees and regulations have stifled entrepreneurship. Due to media attention and public outrage, the county health department has since backed away from the issue and apologized to Julie Murphy. However, stories similar to the government shutting down Julie Murphy’s lemonade stand are far too common.

Over the years, the Institute for Justice has done excellent work defending business owners whose economic liberties have been infringed by overreaching government regulations. For centuries, individuals have immigrated to America to pursue their entrepreneurial dreams. All too often, these dreams have been crushed by strict licensing requirements.

Here are just a few ridiculous licensing requirements that entrepreneurs face around the country: InFlorida, it is illegal to work as an interior designer without proper government licensing. Even if the designer has a college degree in the field, performing interior design services without a license is punishable by up to a year in jail or $1,000 in fines. In Texas, it is prohibited to thread eyebrows—an alternative to eyebrow waxing—without obtaining an irrelevant state license. In order to legally perform this ancient Indian art, eyebrow threaders are now required to spend 1,500 hours in a government-approved cosmetology school costing $20,000 that does not even teach the skill. Furthermore, in Texas, every computer repair technician must obtain a degree in criminal justice or have a three-year apprenticeship under a licensed private investigator to legally fix computers. Computer repair technicians face $4,000 in fines, a $10,000 civil penalty and up to one year in jail if they do not have an extraneous criminal justice degree.

Simply, compulsory licensing is used to restrict competition in a marketplace. Well-funded industry cartels lobby for strict licensing requirements that make it difficult for newcomers to sell their competing product or service. These harsh licensing laws are harmful to both entrepreneurs and consumers. Would-be entrepreneurs who cannot afford the high cost of licensing will not have the opportunity to operate their business. As a result, there will be fewer employment opportunities and consumers will be forced to pay higher prices for goods and services with less variety. If the government is willing to shut down a little girl’s lemonade stand, how far are they willing to go to infringe on our economic liberties?

LABOR DEPARTMENT: 131,000 JOBS LOST IN JULY

Originally posted on August 6, 2010 on FreedomWorks’ website.

Today, the Labor Department’s monthly jobs report revealed that the unemployment rate remained unchanged at 9.5% for July. While the private sector added 71,000 jobs last month, not enough jobs were created to lower the unemployment rate. According to North Carolina State University economist Mike Walden,

We’re not there yet… We need to generate about 200,000 jobs a month nationally to get that unemployment rate to come down.

Economists predicted that the Labor Department report would indicate that 70,000 jobs had been lost. However, the disappointing report revealed that 131,000 jobs were lost in July. This is partially due to the fact that the federal government lost an estimated 143,000 temporary Census workers. As a result, many of these temporary Census workers are back on the harsh job market.

Since June, the number of discouraged workers has remained the same at 1.2 million. These are workers that have given up searching for employment and are not counted in the official unemployment rate.

House Minority Leader John Boehner (R-OH) released a statement asking

How many more times do families and small businesses have to ask ‘where are the jobs’ before President Obama changes course?

Clearly, the Obama administration’s flawed efforts to increase job growth are failing by their own measure. History has proven that increasing government spending will not stimulate the economy. As the comic below shows, Obamanomics has destroyed jobs while increasing Americans dependence on government payouts. It’s time to change course by cutting job-killing taxes and harmful regulations that force Americans to rely on unemployment benefits for their source of income.