Illinois' Welfare State - for Really Big Corporations

Illinois corporations are leaving and threatening to leave Illinois.

To stop this exodus, the Democrat-controlled Illinois Legislature is offering tax breaks to a number of really big corporations. Those breaks will be paid for by you, me and small businesses. A cynic might call this "welfare for large corporations."

In case you missed it, in January of 2011, the Legislature raised Illinois' corporate income tax to 9.5 percent. No Republicans voted for the increase, either in the House or the Senate.

At the time, Gregory Baise, head of the Illinois Manufacturers' Association, according to the Dec. 13, 2011 Huff Post Chicago, predicted that "the only businesses that will benefit (will be) the moving companies. They will be helping many of my members (corporations) move out of (Illinois)." Illinois has a "state bird." Maybe Mr. Baise should be named "state prophet!"

Last month Office Depot Inc. and OfficeMax completed a $1.2 billion merger. the new company will be called Office Depot. Prior to the merger, OfficeMax was based in Naperville, Office Depot was headquartered in Boca Raton, Fla.

The new Office Depot has picked Boca Raton, for its global headquarters, over the Illinois home of OfficeMax, its merger partner. Both companies, of course, asked for tax breaks from Florida and Illinois.

Office Depot Inc. had sought a $53 million EDGE tax credit from Illinois over 15 years. When the incentive failed to pass the Illinois House, Office Depot opted to locate its new headquarters in Boca Raton.

Office Depot CEO Roland Smith said that, after assessing its options, the company determined Boca Raton provided a way for it to drive better profitability and reach planned savings. Businesses prefer to be profitable! According to Mr. Smith, Office Depot looked at a number of factors, including the cost to run each location, lease obligations and sublease considerations, government incentives and tax implications.

Prior to merger, OfficeMax had about 1,600 employees at Naperville. Office Depot Inc. had about 1,700 in Boca Raton. We are told that it is too early to estimate how many OfficeMax employees might move to Boca Raton. It does not appear that any of the 1,700 employees of the old Office Depot Inc will be moving to Illinois.

At the same time Archer Daniels Midland Co. (ADM) has been discussing relocating its corporate headquarters with representatives from St. Louis, Minneapolis, Dallas, Atlanta, etc. Presently ADM has its corporate headquarters in Decatur.

To induce ADM to retain jobs in Decatur and relocate its headquarters to Chicago, Democrat State Sen. Andy Manar, of Bunker Hill, wants the legislature to give ADM a $24 million Edge tax incentive -- $1.2 million over 20 years.

Directly upon learning that Office Depot was heading to Florida, State Sen. Bill Brady, R-Bloomington, called on Gov. Pat Quinn to bring the House back to Springfield to pass an incentive package to keep ADM in Illinois. (capitolfax.com/2013/12/10/officemax-react/).

So, why are corporations leaving and threatening to leave the state? The Tax Foundation has the numbers.

Look at what Illinois, with its 9.5 percent corporate income tax, is competing against: Colorado, 4.63 percent. Florida, 5.5 percent. Georgia, 6 percent and Alabama, 6.5 percent.

Look at the combined city and average local sales tax rates: Illinois, 8.13 percent. Florida, 6.62 percent. Colorado, 7.39 percent. Georgia, 6.69 percent. Alabama, 8.48 percent.

Or look at the Unemployment Insurance rates and taxable wage base. Illinois' highest rate is 8.4 percent on a taxable wage base of $12,740. Florida's is 5.4 percent on $7,000. Georgia's is 5.4 percent on $8,500. Colorado's is 5.4 percent on $10,000. Alabama's is 6.7 percent on $8,000
So, when it is cheaper -- more profitable -- to do business in other states, why would any company choose to remain in Illinois? The answer is simple.

Illinois bribes them to stay here with corporate welfare. If you're big enough, the Legislature will give you breaks that are not available to little businesses.

In Dec. of 2011, Gov. Quinn signed legislation that granted tax breaks and incentives aimed at keeping two large employers in Illinois: Sears Holdings Corp. and CME Group Inc. (operator of the Chicago Mercantile Exchange).

According to the Chicago Tribune, the deal gave Sears tax credits worth $15 million a year for 10 years, which it can use against withheld employee income taxes. The deal also would extend a special taxing district, reducing the company's local property tax bill for another 15 years. CME expected to pay about $158 million for 2011, less than Illinois's 9.5 percent corporate income tax. The legislation is expected to cut that tax bill by nearly half.

The governor justifies the raid on the Illinois treasury as follows: "You have to defend yourself. If Ohio is offering $400 million to Sears, a company that has thousands of employees in Illinois, we will defend ourselves with a reasonable, adequate approach."

I'm sorry. This stinks. President Obama says it's fair to tax the rich to benefit the poor. Gov. Quinn, House Speaker Michael Madigan, Senate President John Cullerton and their cronies in the Legislature have it the other way around: tax the small guy to benefit the rich.

The solution isn't to incentivize big corporations by bribing them to stay in Illinois. The real solution is to lower the corporate tax rate for all corporations. Do that and the incentive for all corporations to relocate out of Illinois will disappear. Of course, that might require some fiscal discipline, and that is unknown in Springfield.


Posted Online: Dec.  20, 2013, 12:00 am - Quad-Cities Online
by John Donald O'Shea

Copyright 2013
John Donald O'Shea


John Donald O'Shea, of Moline, is a retired circuit court judge.

'Means' and 'Ends': Whither Goest America?

Why is compromise in Washington no longer possible? Consider this: There are at play in America two diametrically opposed systems of morality.

The Catholic Church traditionally has taught that the morality of human acts depends on the "goodness" of (a) the object chosen, (b) the intention and (c) the circumstances. It holds that neither the "goodness" of the object nor the intention (for example, helping one's neighbor) justifies using means that are evil, such as lying, demonizing your neighbor or stealing. The church teaches that "the end does not justify the means," and that "one may not do evil so that good may result from it."

The opposing system, which is perhaps best described by Saul Alinsky, teaches that if the "end" is good, the morality of the "means" chosen to achieve that end is not a matter worthy of consideration. All that matters is that the means chosen will work.

In his book, Rules for Radicals, Alinsky devotes his second chapter to a discussion of means and ends. He writes:

"The second rule of the ethics of 'means and ends' is that the judgment of the ethics of 'means' is dependent upon the political position of those sitting in judgment. If you actively opposed the Nazi occupation and joined the underground Resistance, then you adopted the means of assassination, terror, property destruction, the bombing of tunnels and trains, kidnapping, and the willingness to sacrifice innocent hostages to the end of defeating the Nazis.Those who opposed the Nazi conquerors regarded the Resistance as a secret army of selfless, patriotic idealists, courageous beyond expectation and willing to sacrifice their lives to their moral convictions. To the occupation authorities, however, these people were lawless terrorists, murderers, saboteurs, assassins, who believed that the end justified the means, and were utterly unethical according to the mystical rules of war. Any foreign occupation would so ethically judge its opposition. However, in such conflict, neither protagonist is concerned with any value except victory. It is life or death."

Alinsky would no doubt see universal health care as a matter of "life and death." As such, he would place the "have nots" in the shoes of the Resistance, fighting the Nazi occupation, and those who oppose universal health care, in the shoes of the Nazi occupiers. For that reason, an Alinsky-ite would ask only what means he would work? Fair and truthful political argument? Lying? Demonizing your opponents? Destroying his reputation? Calling him a racist? Bribing reluctant supporters? Punishing political opponents?

Alinsky has written, "Life and how you live it is the story of means and ends. The 'end' is what you want, and the 'means' is how you get it. Whenever we think about social change, the question of means and ends arises. The man of action views the issue of means and ends in pragmatic and strategic terms. He has no other problem; he thinks only of his actual resources and the possibilities of various choices of action. He asks of ends only whether they are achievable and worth the cost; of means, only whether they will work. To say that corrupt means corrupt the ends is to believe in the immaculate conception of ends and principles. The real arena is corrupt and bloody. ... he who fears corruption fears life."

Once the Alinsky-ite decides that the end is achievable, and worth the cost, his only other question is whether the means chosen will work. Therefore if lies will work, lying is a permissible means. If destroying your opponents reputation will work, that is permissible. And, at the extreme, if assassinating your opponent works, do it! And if by controlling the press you can stifle all outcry, that too is an acceptable means.

For the Alinsky-ite, the individual cannot stand the way of the good of the masses: "The practical revolutionary will understand Goethe's 'conscience is the virtue of observers and not of agents of action;' in action, one does not always enjoy the luxury of a decision that is consistent both with one's individual conscience and the good of mankind. The choice must always be for the latter. Action is for mass salvation and not for the individual's personal salvation. He who sacrifices the mass good for his personal conscience has a peculiar conception of 'personal salvation'; he doesn't care enough for people to be 'corrupted' for them."

The church teaches otherwise: "Social justice can be obtained only in respecting the transcendent dignity of man. The person represents the ultimate end of society, which is ordered to him. Respect for the human person entails respect for the rights that flow from his dignity as a creature.These rights are prior to society and must be recognized by it. They are the basis of the moral legitimacy of every authority: by flouting them, or refusing to recognize them in its positive legislation, a society undermines its own moral legitimacy. If it does not respect them, authority can rely only on force or violence to obtain obedience from its subjects."

The great problem, of course, with Alinsky's view of ends and means is that if you and your friends can assassinate me (politically or actually) to achieve political or economic mass good, then why can't I and my friends employ like means against you to achieve our notions of mass good? What sort of society do you have when everybody and every political faction lies, bribes and blackmails in support of what they believe to be "social justice?"

Alinsky's equating the struggle between the "have-nots" and the "haves" to war and Nazi occupation turns civilian life into war. But war is the absence of morality and the rule of law. "War is Hell." Is that what we want for ourselves and our children?

So, why is compromise becoming impossible in Washington? How do you compromise when the other side lies about you and the issues? Who vilifies and demonizes you? Who calls you a racist?

Alinsky's notion that the individual and his conscience must be sacrificed for the mass good scares the hell out of me. His paradise looks too much like a new and unimproved version of Stalin's USSR, or Hitler's Germany. If the government -- on behalf of the masses -- determines that the ends are achievable and worth the cost, what prevents the despoilment, destruction or enslavement of the minority "haves?"


John Donald O'Shea of Moline is a retired circuit court judge.


Posted Online: Dec. 05, 2013, 12:00 am - Quad-Cities Online
by John Donald O'Shea

Copyright 2013
John Donald O'Shea

Should the Federal Government Vacuum Leaves?

"Subsidiarity," according to Wikipedia, is an organizing principle of decentralization, which holds that a matter ought to be handled by the smallest, lowest, or least centralized authority capable of addressing that matter effectively.

The principle of subsidiarity is built into the U.S. Constitution. As designed, the federal government was to have only such specific powers as the experiment under the Articles of Confederation made clear were necessary and proper to an efficient national government, consistent the with notion that ours was to be a federal system. The last two amendments to the Bill of Rights were specifically designed to prevent mission creep -- to limit the federal government to the exercise of its "specifically enumerated powers." They are:

"The enumeration in the Constitution, of certain rights, shall not be construed to deny or disparage others retained by the people." -- Ninth Amendment (1791)

"The powers not delegated to the United States by the Constitution, nor prohibited by it to the States, are reserved to the States respectively, or to the people." 10th Amendment (1791)

To understand the practical implications of the principle of subsidiarity, consider Moline's annual leaf vacuuming program. And consider whether every American has a right to have his leaves vacuumed up.

Every year at this time, Moline goes into the business of collecting leaves that have fallen from Moline's innumerable trees. This is a great program. The men and women who conceived, implemented and have continued this leaf collection deserve the gratitude of everybody who breathes Moline air.

In 2012, Moline collected 1,624 tons of leaves (3,248,000 lbs) Oct.15-Nov. 30. This job took 5,592 man hours. In addition to vacuuming leaves, the city also collected 167 tons of leaves using a tractor and hay baler. Once collected, most leaves were spread and then worked into the soil on two farms owned by the city; the remainder were utilized by local farmers. The city incurred no land-fill fees.

The cost of the 2012 program was $285,187, or $6.59 per resident. This was a bargain for every resident of Moline, and an even greater bargain for those residents with asthma or other respiratory diseases who avoided just one night in the hospital.

Nowadays, as the federal education department and Obamacare clearly demonstrate, whenever Congress decides that a problem is "national," the principle of "subsidiarity" gets obliterated.

This federal government mission-creep is not new. It dates back to Dec. 5, 1791, when Alexander Hamilton made his Report on Manufacturers to the House of Representatives. In it he wrote:

"It is, therefore, of necessity, left to the discretion of the National Legislature (Congress) to pronounce upon the objects which concern the general welfare, and for which, under that description, an appropriation of money is requisite and proper.

"And there seems to be no room for a doubt, that whatever concerns the general interests of learning, of agriculture, of manufactures, and of commerce, are within the sphere of the national councils, as far as regards an application of money.

The only qualification of the generality of the phrase in question, which seems to be admissible, is this: That the object, to which an appropriation of money is to be made, be general, and not local; its operation extending, in fact, or by possibility, throughout the Union, and not being confined to a particular spot.

No objection ought to arise to this construction, from a supposition that it would imply a power to do whatever else should appear to Congress conducive to the general welfare."

The federal courts, which were originally controlled by federalist judges, accepted Hamilton's construction of the Constitution. When 140 years later, Congress passed Social Security, federal judges sustained it using Hamilton's reasoning.

But if the only qualification is that "the object, to which an appropriation of money is to be made, (must) be general, and not local, what would stop the federal government from deciding that the leaves that fall throughout the nation each autumn, are a matter of "general" and not just "local" concern? What would stop Congress from deciding that the federal government can do a better job of collecting and disposing of leaves than Moline (and all the other cities throughout the nation)?

How many people would have to be hired at salaries in the range of $100,000 per year to run the new Federal Department of Leaf Collection and Disposal? Would they get pensions? Health care?

What would become of the Moline employees who up until now have collected leaves? Would they become federal employees? Or would they be replaced, and new federal employees hired? Perhaps politically connected ACORN "workers?" Would the appropriations for the new department increase at 3 percent, 5 percent, or 10 percent per year? And would the new federal employees get the leaves collected as efficiently as our local workers? And what new "regulations" would be imposed on Moline home owners?

And when the Feds got involved would the cost remain at $6.59 per Moline resident, or would it decrease? Increase? If you have any doubts, just look to the U.S. Department of Education. It began with two employees. Its 2013 budget was $105 billion. Were the services provided by Washington worth $105 billion to the nation's 81 million school children?

Did each child get $1,300 worth of services from Washington?



John Donald O'Shea of Moline is a retired circuit court judge.


Posted Online: Nov. 21, 2013, 11:48 am - Quad-Cities Online
by John Donald O'Shea

Copyright 2013
John Donald O'Shea

What's Left to Give when Everyone Is Broke?

"There is no misunderstanding this, except by men interested to misunderstand it." — Abraham Lincoln, The Galesburg Debate (1858)

I have never been jealous of rich people. Here's why.

Imagine you have no assets, and that your income is $2 per day. How much can you give (Christian charity) to help the poor? How much can the government tax (social justice) you to assist the poor?

Social justice is premised on the notion that those with excess wealth can be taxed to provide for the basic needs of the poor in genuine need. Social justice presupposes an upper class and a middle class, each having some degree of excess wealth, that can be redistributed to meet the genuine needs of the poor. But what happens if you have no upper or middle classes; when every citizen is poor? Penniless?

Without wealthy capitalists -- and even without the wealthy socialists -- who is there to tax? If nobody is wealthy (which I define as "having surplus wealth"), who can make meaningful charitable or social contributions?

If perfect equality is achieved, and if everybody is abjectly poor, who can you meaningfully tax?

I am not ideologically opposed to social justice. But it is predicated on taxing the people with excess wealth to assist the genuinely needy. If everybody is genuinely and equally needy, social justice income redistribution becomes impossible.

To illustrate, consider a country with a population of 10.1 million, where more than half the men, women and children live on less than $1 a day. Where about 80 percent of the people live on less than $2 per day. A country where 80 percent of the people live below the poverty line. Where 54 percent live in abject poverty.

Imagine a country where 80 percent of its college grads choose to live abroad. Where the money they send home represents 53 percent of the country's GDP. Imagine a city within a city in that country where 500,000 people literally eek out a living on a garbage dump in a place described by the U.N. as the most dangerous on Earth. A country where 225,000 children work for their existence as unpaid household servants.

Imagine Haiti.

What charitable contributions are those who are trying to survive able to make? When somebody is starving on $2 per day, how much of his income can be redistributed? How many of these 8 million Haitians, living on $2 or less per day, are able to provide jobs for fellow Haitians, so as to provide them with a living wage? Would anybody be able to start or run a business and pay salaries on $2 per day? Pay health benefits?

The poor of Haiti have very little to share -- even if they want to. In Haiti, only 20 percent of the people live above the poverty line.

The World Bank tells us that the Haitian 2012 Gross National Income was $760 per person per year. (As such the Total National Income would be $7,676,000,000: that is, 10.1 million Haitians x $760 per person.) Therefore, if the nation's entire GNI was equally redistributed, each Haitian would have $760 annually to live on. The 50 percent living on less than a dollar a day ($365 per year or less) would, after redistribution, see their incomes "jump" all the way up to a still miserable $2.08 per day. Those living on $2 per day as well as the wealthy, after redistribution, also would have incomes of $2.08 per day.

Again, I am not against social justice. But to have meaningful social justice you need prosperous and numerous upper and middle classes. If you have 99 "wealthy" people and only one in "genuine need," social justice is easy to achieve. But when you have 99 who are living in abject poverty, and 1 who is "rich," social justice is an impossibility.

In a thriving capitalist system, you can tax excess wealth, and redistribute taxes to the less fortunate -- to a point. But there comes a point when taxes are raised on the wealthy, that it no longer is worthwhile to run a business and/or take the risks to create "excess wealth." When that point is reached, businesses either shut down, or downsize.

Indeed, the main ways any business downsizes is by laying off employees, and/or by reducing their hours. While those with excess wealth can be asked to pay more, there are therefore practical limits.

The early Christians sold all they had and laid their wealth at the feet of the apostles. That system worked only briefly. But if it was the best system, why did the early Christians abandon it? Why didn't it work for the Pilgrims? And what happened during the 1920s in Germany when the middle class was destroyed?

If you want social justice and redistribution of wealth, you'd had better make sure that you have vibrant upper and middle classes with "excess wealth." The more they have, the better for income redistribution.

Posted Online: Nov. 13, 2013, 12:00 am - Quad-Cities Online
by John Donald O'Shea

Copyright 2013
John Donald O'Shea

Supporting 'Democratically Elected' Enemy Is Nuts

The U.S. cut hundreds of millions of dollars in aid to Egypt, according to The Associated Press, after the "military ouster last summer of the nation's first democratically elected president."

The "democratically elected president" was Mohammed Morsi, who had previously served as chairman of the Freedom and Justice Party when it was founded by the Muslim Brotherhood. Once elected, however, Morsi granted himself power to rule by decree on the pretext that he would "protect" the nation from the "Mubarak-era reactionaries."

There are a number of good reasons for ending American foreign aid. This was not one of them.

There are a great many ways to win an election. The only democratic way is to get more votes than your opponent in an open and free election. But there are many other ways that are hardly democratic. You can kill everybody inclined to vote for your opponent. You can jail opposition voters or keep them away from the polls. You can outlaw opposition political parties, and allow only supporters to vote.

A great many in the Obama administration believe America should support the Muslim Brotherhood as long as it is democratically elected, not withstanding the fact it would destroy our country if it could.

They close their eyes to how it managed its democratic win. We are asked to support a party that kills Coptic Christians and destroys their churches.

According to Wikipedia, the Muslim Brotherhood's stated goal in America "is to instill the Qur'an and Sunnah as the 'sole reference point for ... ordering the life of the ... community ... and state."

The online encyclopedia quotes An Explanatory Memorandum on the General Strategic Goals for the Brotherhood in North America, 1981, which said, for the Brotherhood it is a "'Jihadist Process' with all the word means. The Ikhwan (brothers) must understand their work in America is a kind of grand Jihad in eliminating and destroying the Western civilization from within and 'sabotaging' its miserable house by their hands and the hands of the believers so that it is eliminated and God's religion is made victorious over all other religions."

Wikipedia also links to a federal court document which states the general strategic goal of the Brotherhood in America is "Establishment of Islam in North America, meaning: establishing an effective and stable Islamic Movement led by the Muslim Brotherhood, which adopts Muslims' causes domestically and globally, and which works to expand the observant Muslim base, aims at unifying and directing Muslim efforts, presents Muslim as a civilization alternative, and supports the Global Islamic State wherever it is."

The Muslim Brotherhood, although ostensibly democratically elected in Egypt, was democratic only until it gained power. Once in power it became an intolerant, ruthless theocratic dictatorship.

Eighty years ago, another political party appeared to come to power democratically. But it won by suppressing the vote of all who opposed it. Then, once in power it "democratically" turned itself into a ruthless dictatorship. Next, it started World War II.

On Jan. 30, 1933, Adolf Hitler was appointed German chancellor. Immediately, Hitler demanded dissolution of the Reichstag and new elections. In February, in anticipation of the March 5, 1933, election, the Nazis unleashed a campaign of political terror. Hitler's stormtroopers began attacking trade union and Communist Party (KPD) offices, as well as their homes. Gangs of Nazi "brownshirts" broke up Social Democrat meetings and assaulted speakers and audiences. Newspapers were banned.

The German Catholic Centre Party was attacked. Twenty newspapers were shut down for allegedly "slandering" Hitler's government. Centre Party members holding governmental offices were dismissed from their positions. Stormtroopers viciously shut down their party meetings in Westphalia.

Six days before the election, the German parliament building was set ablaze. The Nazis blamed the Reichstag fire on a communist. Those who believed the Nazi propaganda, turned against the KPD.

Capitalizing on the "emergency," Hitler induced President Hindenburg to issue the emergency Reichstag Fire Decree. Civil liberties were suspended and 4,000 KDP members and their leaders imprisoned. As intended, the Communist vote was suppressed. The day after the March 5 election, the Communist Party was banned.

The Reichstag Fire Decree also handicapped Social Democrats. Party leaders fled to Prague. Members were forced underground. The Nazi terror worked as intended, and on March 5, the Nazis won 43.91 percent of the vote, and 288 seats out of 647. To keep his majority, Hitler continued his coalition with the Black-Red-White Struggle Front.

To the outside world, it appeared Hitler had been democratically elected, and that he had democratically formed a coalition government.

But Hitler wanted to rule by decree -- to have dictatorial powers. He got his constitutionally required two-thirds vote when he persuaded the Center Party and a number of the smaller parties to vote in favor of his March 23, 1933, Enabling Act which gave him power to rule "by decree." Forty-two days later, he abolished trade unions. Leaders were arrested. In July, he decreed it was a criminal offense to start or be a member of any political party other than the Nazis.

The Western Democracies deluded themselves into believing Hitler really didn't mean what he said in Mein Kampf.

America needs to see the Muslim Brotherhood for what it really is. It makes no sense to support someone who would destroy our Western way of life.

A dictatorship, even with the trappings of democracy, is still a dictatorship.
John Donald O'Shea, of Moline, is a retired circuit court judge.

Posted Online: Nov. 07, 2013, 12:00 am - Quad-Cities Online
by John Donald O'Shea

Copyright 2013
John Donald O'Shea

Minimum Wage Job Better For Society Than No Job

Working at minimum wage is not fun. It's not glamorous. But those who do, clearly benefit society.

Don't get me wrong. I would not be satisfied with my healthy college-educated daughter being satisfied with a minimum wage job. But I would rather see her work at a minimum wage job than spend her days at the beach, and living off a SNAP card and the largesse of friends.

The U. S. Bureau of Labor Statistics tells us, in addition to the "unemployed who are actively seeking work," that 2.3 million more people "are unemployed and have quit looking for work."

"In August (2013) 2.3 million persons were 'marginally attached' to the labor force ... not (currently) in the labor force, (but they) wanted and were available for work, and had looked for a job sometime in the prior 12 months. They were not counted as 'unemployed' because they had not searched for work in the 4 weeks preceding the survey.

"Among the 'marginally attached,' there were 866,000 'discouraged workers' ... persons not currently looking for work because they believe no jobs are available for them."

So, imagine two men on welfare. One is "genuinely needy" and is genuinely incapable of working (owing to permanent or temporary disability). The other, though presently poor, is capable of working at a minimum wage, but considers working for minimum wage beneath his dignity and prefers to get by with a SNAP card and the assistance of his friends.

The Illinois minimum wage is $8.25 per hour. A person who makes it will earn, if he works a 40-hour week for 52 weeks, $17,160 per year. Hardly a satisfactory income, but $17,160 better than nothing!

Now consider the 2012 federal tax consequences (for a single person). The Standard Deduction was $7,400. The Personal Exemption was $3,800. As such, the first $11,200 of income is not subject to federal income tax. Assuming the remaining $6,000 was not subject to any further credits, federal income tax to be paid would be about $600. That is not much, but if 2.3 million "marginally attached" people were to pay that much, the U.S. Treasury would take in an extra $1.38 billion.

On the other hand, when you start talking about Social Security and Medicare taxes, you're talking about bigger money. A person working at minimum wage pays both into both. For ease of computation, let's assume the minimum wage is $10 per hour (rather than the actual $8.25).

If a person earns $10 per hour, and works 40 hours per week, his gross income is $400 per week. If he works 52 weeks a year, his annual gross income is $20,800.

The FICA and Medicare payroll tax for 2013 is 7.65 percent of wages up to $113,700. (6.2 percent for Social Security plus 1.45 percent for Medicare). And the employer matches that. If you are self-employed, the tax is 15.3 percent (12.4 percent for Social Security plus 2.9 percent for Medicare).

Therefore, an employee with an income of $20,800, pays $1,591 (for FICA and Medicare); his employer also pays $1,591. A self-employed individual pays the same: $3,182 ($1,591 times two).

If 2 million more people earn $20,800 per year, The U.S. Treasury takes in an additional $7.32 billion in Social Security and Medicare taxes each year.

Why is that important? Consider a May 31 report in "The Hill" (thehill.com/blogs/on-the-money/budget/302719-social-security-insolvent-by-2033#ixzz2gaTypMty).

"Medicare will reach insolvency by 2026 ... Social Security's two trust funds (old age and disability) will become insolvent by 2033 ...

"... (The) Social Security (old age fund) will no longer be able to pay full benefits to retirees after 2033. Only three-quarters of benefits will be delivered after the projected insolvency date."

"The trust fund that pays disability benefits through Social Security is headed for insolvency in 2016 and will only be able to pay out 80 percent of benefits after that date."

So what am I trying to say? People who are genuinely in need are the only people who should be getting welfare or social justice distributions. They would include people who can't work because of temporary or permanent physical or mental disability -- such as a disabled child, a mentally impaired adult or a wounded soldier. A compassionate society clearly has a social justice duty to those who can't help themselves. A person who has no ability to work, has no duty to the state or the taxpayers to work.

But what about people capable of working, who are temporarily out of work? I suggest that while they may be entitled to reasonable temporary assistance for a reasonable period of time, that they have a duty to minimize the amount of assistance needed by taking work -- even at a minimum wage job. When they pay federal, FICA and Medicare taxes they contribute to the long term solvency of the Social Security and Medicare funds, and more slowly deplete what would be available to assist those in more profound "genuine need."

Simply, people capable of working, but who refuse to work, should not be getting social welfare money. As St. Paul said in II Thessalonians, "He who will not work, shall not eat."

So my point is this: A single person who works and makes minimum wage helps support himself, contributes tax dollars to the welfare, Social Security and Medicare funds, reduces their rate of depletion, makes additional dollars available for those needier than him, and derives a degree of satisfaction by being productive and by being a contributing member of society.

Posted Online: Oct. 23, 2013, 11:00 pm - Quad-Cities Online
by John Donald O'Shea

Copyright 2013
John Donald O'Shea

Ted Cruz: 'Wacko Bird' or True Patriot?

Is U.S. Sen. Ted Cruz, R-Texas, really a tea-party anarchist or is he an American who cares deeply about our country? I think it's too early to tell.

In his acceptance speech at the Republican National Convention in 1964, Barry Goldwater argued "Extremism in defense of liberty is no vice. ... Moderation in defense of justice is no virtue." (youtube.com/watch?v=E9buEI8SgwU)

Like many other Americans at the time -- when most adult Americans believed in American "exceptionalism" and considered America the greatest country on earth -- I was mildly amused by his words. In those days, I was a young Jack Kennedy/Harry S. Truman Democrat. I didn't realize that at the time, that in listening to Sen. Goldwater's speech, I was listening to the beginning of modern-day conservatism.

In his book, "The Conscience of a Conservative," (1960) Goldwater wrote "I ... propose to extend freedom. ... "My aim is not to pass laws, but to repeal them. ... not to inaugurate new programs, but to cancel old ones that do violence to the Constitution, or that have failed their purpose, or that impose on the people an unwarranted financial burden. ...

"And if I should later be attacked for neglecting my constituents' 'interests,' I shall reply that I was informed that their main interest is liberty and that in that cause I am doing the very best I can."

Sen. Goldwater was saying the first and most important duty an American president was to guarantee is the birthright of the American people: Liberty.

Now, Sen. Cruz proclaims a desire to snatch the banner Goldwater dropped as he passed from the political scene: And the left savages him. Consider this tidbit from the Huffington Post:

"Sen. Ted Cruz (R-Texas) is the best thing that has happened to Democrats since 'Brownie' handled Katrina for Bush 43, and Senate Majority Leader Harry Reid (D-Nev.) is playing him like a violin. Let him talk, and the more voters who hear Cruz, the better for Democrats.

"Cruz is not only the biggest vanity player in Washington (and that is saying something!), and he is not only a charlatan ... he is a walking advertisement for the weird ring of Republicans -- I call them Banana Republicans -- who could well become a death knell for Republicans in 2014 and 2016."

But is Sen. Cruz really the stupid buffoon, that the "left" and The Huffington Post tells us he is? Not if his academic record is any indication.

Sen. Cruz was valedictorian of his high school class, graduated cum laude from Princeton, and magna cum laude from Harvard Law School. Allan Dershowitz, a "lion of the left," has said that "Cruz was off-the-charts brilliant." Cruz clerked for the Chief Justice of the U.S. William Rehnquist.

Clerking for the chief justice is the most prestigious position available to a law school grad. It is not available to the stupid.

So the real issue is, is Cruz a "charlatan," a "weirdo" or "bananas?" Is he "publicity hound," or does he really believe in what he says?

Recently, a friend of mine sent me a video -- a nine-minute speech made by Ted Cruz's father, Rafeal Cruz. I provide the link below. I defy you to watch Cruz's father and come away with the "take" that Ted Cruz is an insincere "vanity player." On the other hand, it is very easy to come to the conclusion that Ted Cruz, like his father, Rafeal Cruz, has as his first value "liberty."

Rafael Cruz is a refugee from Cuba. He went to jail and was beaten for protesting the oppressive dictatorship of Fulgencio Batista. He welcomed the revolution that brought Fidel Castro to power, but then when Castro began seizing private property and suppressing dissenters, he fled to the U.S. at age 18 -- with no money and unable to speak English. Listen to what the senior Cruz says and how he feels about America. Perhaps it takes an immigrant and political refugee to explain to Americans what America really stands for -- "liberty" and "opportunity." And consider how easily this most basic of human rights can be lost (youtube.com/watch?v=0Ym4Xt0T6fM feature=player_embedded).

So is Ted Cruz a "wacko bird" as John McCain says, or is he "his father's son?"

It has been wisely said that "social justice can be obtained only in respecting the transcendent dignity of man. The human person represents the ultimate end of society, which is ordered to him. Respect for the human person entails respect for the rights that flow from his dignity as a creature. These rights are prior to society and must be recognized by it."

Without freedom of the individual, there is no social justice.

So, if that is what Ted Cruz really believes, he is no "humbug." His political ideas deserve careful examination -- at least until he proves himself to be another Washington political hack.

In America, when serious men have an important point to make, they seek the optimal public forum. To call attention to his cause, the Rev. Martin Luther King and his supporters took to the streets. When Abraham Lincoln believed the Dred Scott decision was immoral and wrong, he denounced it in the Lincoln/Douglas debates, even though after the U.S. Supreme Court's ruling, Dred Scott became "the law of the land."

When U.S. senators -- men such as Webster, Clay and Calhoun -- have believed that legislation undermines the welfare of the American people, for 200 years they have taken to the floor of the Senate. What better way does a senator have to call attention to his point than to take to the will of the Senate, and hold the floor until press and public are forced to notice?


Posted Online:  Oct. 08, 2013, 11:00 pm - Quad-Cities Online
by John Donald O'Shea

Copyright 2013
John Donald O'Shea

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