A news item on President-elect Obama’s tax package and NAM support for carry-back provisions was included in AP’s briefs package today, producing associations we don’t often see. Well, never see…

We anxiously await Dorothy’s review of the Woo film.

Funny observation in Jay Nordlinger’s “Impromptus” column today:

More on language: A friend wrote (not in text), “Have you noticed the fashion of calling attorneys general by their adjective? I was reminded just now when Geraldo called Jerry Brown ‘General Brown.’”

We don’t cite Nordlinger around here much except when he’s at Davos; he writes mostly about culture with a dose of foreign policy. But his column yesterday at National Review Online, “My Kingdom for a Safe Zone,” was a joy to read, albeit a depressing joy, and it warrants a plug. Nordlinger chronicled the incessant inclusion of left-wing political commentary and snobbery in what should be apolitical cultural events like symphonies. We see the same phenomenon in rock ‘n roll acts, of course: OK, Elvis, we get it, you’re against the war. Now shut up and sing.

Anyway, outstanding column.

CNBC host and analyst and all-around smart guy Larry Kudlow comments on the inclusion of pro-growth tax relief in the Obama stimulus plan, “Team Obama Adds Business Tax Cuts.” He’s positive, but says more can be done:

However, as yet there is no Obama signal for the most powerful tax incentives that would slash the 35 percent top corporate rate to something around 20 percent. This should apply both to large C-corps and small-business S-corps. It would attract investment, improve future job creation, and relieve consumers who really shoulder the corporate tax costs. Additionally, full cash expensing for business investment write-offs would provide an even greater bang for the buck.

So while the new tax-refund plan and faster depreciation are positives, they are still much weaker than a full-bore supply-side tax-rate reduction that could even morph into full-fledged corporate tax reform. Now we wait for a Republican response, which hopefully will be bold corporate tax reform as well as reduced individual tax rates (at least for the middle class).

Encouraging, if sketchy, news out of yesterday’s meetings between President-elect Obama and congressional leaders: A stimulus plan could include some $300 billion in tax relief, including substantial incentives for business investment

The Associated Press, “Obama stimulus plan boosts business tax refunds”

WASHINGTON (AP) — President-elect Barack Obama’s proposed stimulus package would provide businesses with billions of dollars in refunds on taxes they paid several years ago.

The refunds are popular among business groups and could increase pressure on Republicans to support Obama’s massive stimulus package, even though most of them are wary of government spending increases that could send its total cost to $800 billion or more.

“This gives companies an infusion of cash just when they need it,” Dorothy Coleman of the National Association of Manufacturers said of the proposed refunds.

Obama’s proposal to stimulate the economy includes tax cuts of up to $300 billion, including more than $100 billion for businesses.

The refund provision would enable some companies posting losses last year to get refunds for taxes paid as far back as five years earlier. The businesses could refile their old tax returns, using the losses suffered last year to offset profits made when times were good.

The term of tax art is net operating loss carry-backs. The NAM has consistently advocated the carry-backs, as you can see in this January 2008 statement from NAM President John Engler:

A Five-Year Carry-Back for Net Operating Losses (NOLs): Allowing companies in a downturn to “carry back” current losses to earlier, profitable years, will free up funds that can be used for investment and job creation. The net operating loss (NOL) carryback provisions enacted in 2002 provided much needed relief to a number of manufacturers. In one case, an NAM member was able to reopen a plant, in part because of the refund the company obtained from the NOL provisions.

• The Wall Street Journal’s piece provides more details, “Obama’s Back-Tax Bonanza” Also…
• Washington Post, “Obama Pitches Stimulus Package to House Republicans”
• Boston Globe, “Economists divided over cutting taxes” Well, of course, they are. That’s boiler plate, you know: “Economists divided over …” and then you plug in the policy divisor.

All in all, good, pro-growth tax provisions being discussed as part of the stimulus bill. Everywhere else that would be a tautology — “stimulus plan contains pro-growth provisions” — but here in Washington, you never know.

From the Rochester (N.Y.) Democrat-Chronicle, “Slaughter asks oil giants to explain why N.Y. pays more for gasoline“:

U.S. Rep. Louise Slaughter is looking to some of the world’s major oil companiesfor answers as to why western New York motorists pay more at the pump than drivers in other states.

The Fairport Democrat’s office released a copy of a letter sent today to the heads of Sunoco Inc., Citgo Petroleum Corp. and ExxonMobil Corp., asking why there is a price discrepancy between local filling stations and average prices in New Jersey and Massachusetts.”I … am deeply worried about the many western New Yorkers forced to choose between putting food on the table and filling their gas tank to travel to work,” Slaughter wrote in the letter.

According to AAA, the average price for a gallon of regular in New Jersey is $1.51, while in Massachusetts it is $1.63. In the Rochester area, it is $1.78.

One reason for the difference is taxes. According to the American Petroleum Institute, New Yorkers pay nearly 61 cents in state and federal taxes on a gallon of gas, compared with roughly 32 cents in New Jersey and 42 cents in Massachusetts.

You know, we haven’t had an FTC study of gas prices in a good, oh, six months at least.

Can we at least get the court to order sanctions this time?

Tying up more public resources and abusing the same small-business owners again and again and again, Roy Pearson has filed for a rehearing of the dismissal of the $54 million lawsuit he brought against his D.C. drycleaners, the Chungs, for supposedly misplacing his pants.

The Chungs’ attorney, Chris Manning, notifies us this morning that Pearson filed a Petition for Rehearing or Rehearing En Banc with the DC Court of Appeals, asking to have the December 18, 2008 denial of his appeal of the pants lawsuit overturned. (See the petition, here.)

Manning says in an e-mail that if the petition for a rehearing is granted, the original panel of three judges that heard the case would rehear the case. If the petition for rehearing en banc is granted, the entire panel of DC Court of Appeals judges would rehear the case. Pearson could also eventually petition for the United States Supreme Court to hear the case, although surely he would be stopped before that, right?

Manning adds:

Mr. Pearson’s Petition is sad and unfortunate.  Amazingly, despite two resounding defeats, Mr. Pearson has, once again, decided to prolong the needless agony of this case for the Chungs, for the DC taxpayers and for everyone involved.  The Chungs and I hope the DC Court of Appeals will deny Mr. Pearson’s Petition and will put this case to rest in this jurisdiction.  Most importantly, the Chungs and I call on Mayor Fenty and the DC City Council to amend the very vague and often unfair DC Consumer Protection Act so that cases like this cannot happen again.

Pearson’s obsessive litigation has cost the Chungs more than $100,000 in legal costs, and they closed two of their drycleaning outlets because of the legal harassment. Pearson lost his D.C. administrative law judge post because of his litigiousness, and has become a subject of international mockery and opprobrium, deservedly so.

Perhaps we’ve missed it, but despite repeated calls for reforms to the D.C. Consumer Protection Act, we’ve not seen comments on the subject from Mayor Fenty or the Council. Let’s get moving.

At National Review’s The Corner, there are several good posts refuting organized labor’s claim that the Employee Free Choice Act will still allow secret-ballot elections. In theory, yes. In the real world, of course not. Never, ever.

House Majority Leader Steny Hoyer tried to sell the unbelievable argument in the otherwise obfuscation-free interview Sunday on Fox News. (Passage here.) Former NLRB member Peter Kirsanow responds here.

Rep. Hoyer’s assertion on Fox News Sunday that EFCA wouldn’t eliminate secret ballot union elections but would present merely an alternative method for union certification is accurate. It’s also wildly disingenuous. No union, upon obtaining the requisite 50% +1 of union authorization cards, is going to petition for an election when at that point the union can be instantly certified under EFCA.

Hoyer knows perfectly well that employees may act differently in the privacy of the voting booth than when asked to sign a card in the presence of co-workers and union agents. Unions know this, too. That’s precisely why EFCA would cause the extinction of secret ballot union elections.

The good news for EFCA opponents is that if this is Hoyer’s best defense of EFCA, he knows the bill’s got problems.

See also these comments.

In a separate post, Kirsanow makes the important point that the “card check” component of the Employee Free Choice Act is not the only objectionable provision, and indeed, the binding arbitration requirements also make the legislation unacceptable.

For some time, experts close to the EFCA debate have maintained that the strategy of EFCA proponents was to compromise on either the bill’s card check provision or the mandatory arbitration provision in order to enhance the probability that at least one of those provisions would pass. Some contended that mandatory arbitration was always the principal goal of EFCA supporters.

Doubt it has ever been the principal goal, but binding arbitration is clearly a priority for labor. We covered that part of the debate here.

Do they coordinate their outfits, too, these comic strip cartoonists? “OK, Monday is pink shirt, blue tie and let’s do a strip on the newspaper business.” In today’s Washington Post…

Brewster Rockit, Space Guy

Mother Goose and Grimm

Traveling across the country Saturday, we had the opportunity to read local newspaper stories reacting to the ISM’s December Manufacturing Report. Grim.

AP national story, and the New York Times writes, “Manufacturing Reports Show Depth of Global Downturn.” Grim.

Creighton University’s Ernie Goss uses the ISM methodology to rank the economies midwestern states, so here’s that story, “Survey: Recession will worsen in the months ahead,” and the sidebar,”Mid-America survey state-by-state glance.” Grim.

But then, instead of grimmer, a glimmer. From the New York Times, “Some Forecasters See a Fast Economic Recovery“:

In the midst of the deepest recession in the experience of most Americans, many professional forecasters are optimistically heading into the new year declaring that the worst may soon be over.

For this rosy picture to play out, they are counting on the Obama administration and Congress to come through with a substantial stimulus package, at least $675 billion over two years.

They say that will get the economy moving again in the face of persistently weak spending by consumers and businesses, not to mention banks that are reluctant to extend credit.

Even with the conditions, we’ll take the offering of optimism.

Senator Judd Gregg (R-NH), ranking member of the Senate Budget Committee, makes the important point in today’s Wall Street Journal that any economic stimulus legislation should emphasize improving long-term U.S. productivity. Given the economic and budgetary stakes, let’s put the money where it does the most good.

Senator Gregg’s comments on infrastructure and taxation are right on the mark. From “How to Make Sure the Stimulus Works“:

[If] we’re going to have an infrastructure feeding frenzy, make sure government builds public works that will make us more productive as a nation. We all love swing sets and water parks, but recovery is not about soccer games or Main Street beautification. This is about bringing the nation out of this recession in a manner that makes us more competitive in the international market. We need things like roads, bridges, mass transit capital expansion, integrated IT in public industries like health care, and military recapitalization. The test should be simple: Is it necessary and will it make us more competitive as a nation?…

[We] must cut taxes for job creators. This is one thing Republicans did when we had the magic wand, and it worked. The growth in tax revenues from 2002 through 2007 were some of the largest in history. The tax system became much more progressive, with the top 20% of income earners paying 85% of the taxes — a rate much higher than during the Clinton years — all while keeping capital-gains rates low.

We’d guess the idea of reviving the WPA “Federal Writers’ Project” to pay out-of-work newspaper reporters to chronicle his brave new age would not be a priority under this approach. Yes, some people are seriously proposing it. Give us a viaduct instead.