Wednesday, October 29, 2014

IRS Confiscating Bank Accounts of Small Business Owners Without Evidence of a Crime

The Internal Revenue Service, still embroiled in controversy over the inappropriate targeting of conservative groups under the leadership of Lois Lerner, is abusing agency rules that allow for the confiscation of bank accounts without evidence of a crime, taking the concept of "guilty until proven innocent" to a whole new extreme by failing to distinguish lawful small business owners from money launderers and illegal drug operations.

According to a report published in the New York Times, the IRS has been confiscating private funds belonging to small business owners based on "suspicions," not evidence of a crime.

For almost 40 years, Carole Hinders has dished out Mexican specialties at her modest cash-only restaurant. For just as long, she deposited the earnings at a small bank branch a block away — until last year, when two tax agents knocked on her door and informed her that they had seized her checking account, almost $33,000.

The Internal Revenue Service agents did not accuse Ms. Hinders of money laundering or cheating on her taxes — in fact, she has not been charged with any crime. Instead, the money was seized solely because she had deposited less than $10,000 at a time, which they viewed as an attempt to avoid triggering a required government report.

“How can this happen?” Ms. Hinders said in a recent interview. “Who takes your money before they prove that you’ve done anything wrong with it?”

The federal government does.

Using a law designed to catch drug traffickers, racketeers and terrorists by tracking their cash, the government has gone after run-of-the-mill business owners and wage earners without so much as an allegation that they have committed serious crimes. The government can take the money without ever filing a criminal complaint, and the owners are left to prove they are innocent.

Many give up. The majority of people targeted by the IRS unfairly give up, which is exactly why this abuse of power and government overreach is unacceptable. It is impossible to fight back against the most powerful agency that exists within the federal government. With one confiscation, the IRS destroys the lives of productive, law abiding, middle-class American citizens. The worst part? The IRS has made this a habit. More on this from Jazz Shaw:

According to their records, Ms. Hinders has still yet to be charged with any crime, but has gone into debt while attempting to get the money returned. And she’s not the only one they turned up. The IRS used this tactic 639 in 2012 alone, with only 20% of those cases ever being prosecuted.

Another interesting item of note show up here. When such funds are seized, law enforcement agencies get to keep a share of whatever is forfeited. If that doesn’t set off some red flags for you, nothing will.

Republican Senator Ted Cruz has repeatedly called for the elimination of the IRS. The revelations and stories of IRS abuse in this manner are just the latest examples of why he is absolutely correct.



A logic gap on the 'gender gap' in politics

by Jeff Jacoby

ARE YOU voting for Charlie Baker for governor, sweetheart? He's been trying hard to win your support, in part through the familiar technique of highlighting those who support him already. For if there's one thing the Republican gubernatorial candidate wants you to know, it's that plenty of women do indeed support him.

There is a "Women for Charlie" Facebook page and a "Women for Charlie" photo gallery. There was a "Women for Charlie" reception in West Roxbury last night, and a "Women for Charlie" fundraiser in the South End last month. "Women for Charlie" phone banks organize call centers every Wednesday night. There was even a recent drawing for "a basket of W4C goodies," complete with "Women for Charlie" T-shirts and earrings. Needless to say, there is a "Women for Charlie" link atop every page of the Baker campaign website.

All of which makes good sense — assuming you believe that biology is political destiny, and that a candidate who loses the women's vote loses the election.

But biology isn't destiny, and it's patronizing or cynical to act as if it were. Candidates win elections all the time without winning a majority of women. Even Republican candidates. Even in Massachusetts.

For decades, pundits and politicos have harped on the "gender gap" in American politics, which is widely understood to mean that Republicans are crippled on Election Day by their lack of appeal to women. It is true enough that women (especially unmarried women) are more likely to vote for Democrats. But it's also true that men are more likely to vote for Republicans — a counter-gap that has spelled defeat for any number of Democratic hopefuls. At the presidential level, Democratic candidates have attracted more women's votes than their GOP opponents in each election since 1980, yet Republicans have won the White House in five of those nine races

The gender gap hasn't been fatal to GOP hopes at the state level, either.

"In every governor's race of the 1990s, the male vote for the Republican candidate exceeded the female vote for the Democratic candidate, thus producing a net GOP advantage," wrote Elaine Kamarck, a former senior staffer in the Clinton White House, in a 2003 CommonWealth magazine analysis of Massachusetts politics. A Boston Globe story in September on how Baker and Martha Coakley are waging a "war for women's votes this fall" was accompanied by a bar graph that usefully broke down the vote by candidate and gender in six hard-fought marquee Massachusetts races since 1998. In four of those statewide races, the candidate who won more men's votes won the election — and three of the four were Republicans. Only twice did a Democrat win without a majority of male voters: when Governor Deval Patrick turned back Baker's challenge in 2010, and when Elizabeth Warren successfully ousted Senator Scott Brown in 2012.

So why the obsessive focus on the GOP's need to do better among women? If the goal is to win elections, Republicans would presumably do just as well to play to their strength, concentrating on boosting their share of men's votes even higher. Alternatively, Democrats should be fretting about their man problem at least as much as the other team keeps agonizing over its woman problem. Where is the "Men for Martha" Facebook page? Why isn't the attorney general grabbing every opportunity to explain why a Coakley administration will be a boon for Massachusetts men?

Barbara Anderson, the intrepid director of Citizens for Limited Taxation and a battle-scarred veteran of Massachusetts politics going back to the fight for Proposition 2½, strongly backs Baker for governor. But she refused to attend a recent "Women for Charlie" event, she writes in the Salem News, "because I don't do events that begin 'Women for' anyone." Anderson doesn't want politicians to see her first and foremost as a member of her sex, or to be pandered to on that account. Why would anyone? She and Coakley agree on nothing and have little in common "other than the reproductive system," Anderson writes. "So why would political consultants assume other women would support either one of us as if we were interchangeable?"

Exactly right. The gender gap is real, and it's likely to be a feature of American politics for years to come. It is one of many discrepancies that make the sexes interesting, maddening, or perplexing to each other. But it is only a tendency, not even a rule of thumb. Plenty of women vote Republican; plenty of men vote Democratic. There are far stronger influences on voting choices than the presence or absence of a Y chromosome — political ideology, religion, and marital status, to name just three. Your gender is a silly reason to vote for any candidate. It's an even worse reason for any candidate to ask for your vote.



The Real Story on How Much Obamacare Increased Coverage

We now have the Medicaid and private-market health insurance enrollment data for the second quarter of 2014 needed to complete the picture of how Obamacare’s rollout affected coverage.

What we’ve learned is that the Obamacare gains in coverage were largely a result of the Medicaid expansion and that most of the gain in private coverage through the government exchanges was offset by a decline in employer-based coverage. In other words, it is likely that most of the people who got coverage through the exchanges were already insured.

The second quarter data captures enrollments that occurred during the last two months of the open enrollment period, or which were otherwise delayed due to the numerous problems experienced by the exchanges, and so did not take effect until after the end of the first quarter.

Our analysis of the data is reported in more detail in our latest paper, but our key findings are that in the first half of 2014:

Enrollment in individual-market plans (both on and off the exchanges) increased by 6,254,564 individuals.

Enrollment in private employer-sponsored group plans declined by 3,788,978 individuals.

In the states implementing the Obamacare Medicaid expansion, enrollment in Medicaid grew by 5,716,977 individuals.

In the states not implementing the Obamacare Medicaid expansion, enrollment in Medicaid grew by 355,674 individuals.

Applying a little arithmetic to those four key data points yields the following observations:

The drop in employment-based coverage offset 61 percent of the gains in individual-market coverage, for a net increase in private-sector coverage of 2,465,586 individuals.

Total Medicaid enrollment increased by 6,072,651 individuals, with 94 percent of that growth occurring in the states that adopted the Obamacare Medicaid expansion.

The total, net increase in health insurance coverage (private-market and Medicaid combined) during the first half of 2014 was 8,538,237 individuals, but 71 percent of that coverage gain was attributable to Obamacare expanding Medicaid to able-bodied, working-age adults

When it comes to covering the uninsured, Obamacare so far is mainly a simple expansion of Medicaid.

Thus, while most of the attention this year focused on the new health insurance exchanges, the data indicate that a significant share of exchange enrollments were likely the result of a substitution effect—meaning that most of those who enrolled in new coverage through the exchanges already had coverage through an individual-market or employer-group plan.

Given that increased enrollment in Medicaid accounted for 71 percent of the net growth in health insurance coverage during the first half of 2014, the inescapable conclusion is that, at least when it comes to covering the uninsured, Obamacare so far is mainly a simple expansion of Medicaid.

The 2015 exchange open enrollment period is scheduled to start less than a month from now (on Nov. 15), while enrollment in state Medicaid programs occurs year round. When the resulting enrollment data for the next phase of Obamacare become available it will be interesting to learn:

The share of 2015 exchange enrollments that represent new applicants, as opposed to reenrollments by individuals who obtained exchange coverage in 2014;

Whether the number of Americans with individual market coverage continues to grow, and whether the number of those with private employer-group coverage continues to decline;

and If expanding Medicaid to able-bodied, working-age adults continues to be the principal source of coverage growth under Obamacare.



Tesla blocked by bipartisan cronies in Michigan

Tesla Motors, the American car maker created in 2003 by “engineers who set out to prove that electric vehicles could be awesome,” has been banned from opening stores in Michigan to advertise and sell its vehicles.

The “anti-Tesla” bill prevents auto makers like Tesla, who set up shop exclusively through regional stores and sell directly to the customer, from cutting out the middle man when competing with established car companies selling through the traditional franchised dealerships.

The new law, pushed unsurprisingly by General Motors and car dealer associations, was signed by into law by Michigan Governor Rick Snyder after passing the state legislature with a single dissenting vote.

This important, anticompetitive law proves exactly why Michigan automobile innovation is dying at the hand of bipartisan cronies unwilling to allow auto makers adapt to a new business environments.

Arguments in support of the law are silly when put to the test of common sense. Proponents of the ban most often say that car dealerships are best for the consumer because the inherent competitive nature of inter-dealership relationships and that a company selling direct would have too much negotiating leverage over buyers.

So imagine a company (say, for instance, a major tech company named after a popular fruit) that designs and sells a high-end product that never goes on sale while competing with products sold primarily through third-party retailers. Yet, somehow, the same proponents of anti-Tesla laws across the country haven’t signed on to legislation banning Apple from doing the exact same thing by selling Apple products and merchandise through the Apple Store — because it would be ridiculous government interference.

Yet, for some indiscernible reason, automobiles are deemed a transcendent product that can only be sold by big government-approved, traditional means of franchised dealerships.

“Tesla is selling a new product with a new technology,” the company said of the new law in a statement. “The evidence is overwhelming that a traditional dealer-based approach does not work for electric cars.”

Further, Democrats who support this bill betray the global warming alarmism religiously adhered to by members of their party. Kill off the coal industry? No problem. Allow fully electric cars to be sold directly to drivers so that an electric car company can take market share from the gas-guzzling competition? No way!

Republican supporters betray the limited government, free market principles they claim to support. The automobile industry may be on the cusp of dramatic change, and they of all parties should understand the damaging nature of government interference for special interests. But for those concerned first and foremost with special interests, donor dollars from GM will flow far deeper than any Tesla contributions for Michigan state legislators.

The bottom line is that government should have no business telling companies like Tesla, who are innovating and risking tens of billions of dollars in the auto market, how they should conduct their business or sales strategies.

Consumers benefit far more, especially in the long term, when industries explore diverse methods of attracting the consumer’s dollar. Special interests (GM, Michigan dealership associations) will spend millions to maintain the status quo, telling consumers that their vice grip on the market is what’s best all the way to the bank. It’s up to the people’s representatives to know better.



For more blog postings from me, see  TONGUE-TIED, EDUCATION WATCH INTERNATIONAL, GREENIE WATCH,  POLITICAL CORRECTNESS WATCH, AUSTRALIAN POLITICS, and Paralipomena (Occasionally updated) and Coral reef compendium. (Updated as news items come in).  GUN WATCH is now mainly put together by Dean Weingarten.

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