March 31, 2004

A New Era in Tech Journalism?

Online Journalism Review says recent developments at CNET may herald a revival of technology journalism, and has a Q&A with founding CNET editor Jai Singh, who discusses the role of blogs and bloggers in the new media era.

OJR: What Web logs do you like and what do you not like?

Singh: That's a loaded question. We literally have a daily discussion on this topic. We have a lot of top people writing columns and perspectives but we know that the bulk of our readership still comes to us for the news. In one sense, my editor for opinions, Charles Cooper, writes a column that's sort of a blog, and we have this "Your Take" feature now, whereby readers can respond to his column, but it is not a two-way thing.

I think with news the question is which blogger do you really trust. There are so many of them. It seems to me like it's a pretty incestuous thing going on. One journalist points to another journalist's blog and other bloggers point to other people's blogs, and you somehow think that this is the most popular thing. But is it credible? I don't know.

There's this notion that with a blog you don't have to have the same journalistic standards. Obviously I don't ascribe to that. People have busy lives and want to know the facts, and want to know if they are truthful. What I don't like is the credibility factor that falls on my shoulders to figure out. What I do like is the two-way engagement many times, where you are interacting with your readers.

Flower Power

Glenn Reynolds is blogging about about the yellow daisy flower hanging from John Kerry's ski suit. (AP photo reproduced at Powerline). Is it a lift ticket? Was it Photoshopped into the photo, a dastardly Republican dirty trick? Here's another photo of Kerry with flower decoration, from the Idaho Mountain Express newspaper in Ketchum, Idaho.

There's another here of Kerry with the flower dangling from his ski jacket. Is it a lift ticket? The Sun Valley ski patrolman sking with Kerry does not appear to have one... And Kerry isn't taking a lift to the top of the hill - he's ski-hiking up the hill. The mind reels...

From God's Eye

Rubel Shelly considers a moment from near the end of The Passion of the Christ:

One of the wonderful things about art is its subtle ambiguities. The smile of the Mona Lisa. A poet's turn of phrase. The haunting refrain of a piece of music. Or a stunning visual metaphor in a movie. It is precisely the ambiguity of these words, sounds, and sights that creates multiple interpretations.

Toward the end of Mel Gibson’s The Passion of the Christ comes the one scene that took me completely off-guard. Since I had read the book before going to see the movie, I knew the story line. The central characters were identifiable. Even the subtler references to persons and events not detailed in the movie were easy to pick up. But one jolted me.

March 30, 2004

The Gift

Every once in awhile I write a comment on someone's blog, or sometimes responding to a reader's comment on my own blog, and decide later that it deserves to be its own blog post. A few posts below this, in the comments dealing with John Kerry's mis-use of a famous passage from the New Testament book of James, is such a comment, made in response to a reader who wrote that "obedience to God's commands is absolutely essential for salvation," so I'm re-running it here. The reader first quotes from my blog post:

"Salvation was accomplished on the cross 2,000 years ago (See: The Passion of The Christ). It is received as a free gift of grace when you profess your faith in what God did, period. Salvation is powered by God, not by any human action other than faith. It is the height of human arrogance to assert that a human work contributes to salvation. Real faith as it matures produces action, but your good works do not contribute to salvation."

"He that saith, I know him, and keepeth not his commandments, is a liar, and the truth is not in him. But whoso keepeth his word, in him verily is the love of God perfected: hereby know we that we are in him. He that saith he abideth in him ought himself also so to walk, even as he walked."

Obedience to God's commands is described in that verse as a product of "knowing" God - i.e., being saved. A saved person strives to do God's will - but one is NOT saved by doing God's will. One is saved by the blood of Jesus and the fact of Jesus' resurrection.

I grew up in, and grew out of, a Christian tradition that taught a works-based salvation. God gives you a bucket, you fill it with enough good works and enough avoiding of sin and you earn your way to heaven. You climb the ladder 99 percent of the way there and "grace" pulls you over the last step.

You follow a "five step plan" of salvation, as if sinful man can accomplish his own salvation by following a how-to brochure.

We were told that God's grace was the giving to us of the plan by which we could accomplish our salvation. Hogwash. God's grace was the giving to us of Jesus, crucified and resurrected.

There is no five-step plan of salvation. There is only salvation, accomplished, by God's plan, on a Roman cross outside of Jerusalem 2,000 years ago. You accept the free gift of salvation and let it change you - and that change produces a life of obedience and good works (though imperfectly) - or you reject it.

The verse [the reader] quoted says exactly that. A person that claims to know Jesus but does not follow God's commands does not really know Jesus - they are not saved. But it is not the lack of obedience that produces the lack of salvation. It is the lack of salvation that produces the lack of obedience.

The notion that any amount of our obedience, our good works, our command-keeping, can measure up to anything other than infinitesimal, insignificant and worthless compared to what Jesus did on the cross strikes me as the peak of human arrogance. Stack up all your obedience, all your theological understanding and doctrinally sound positions, all your good works, all your law-keeping, all your avoidance of sin, and stack it all up next to the cross. It is worth nothing compared to what He did - and you're no better and no worse than this world's Mother Theresas or Billy Grahams - or its Barabbas'es.

... Good works and moral living flow from your salvation, they do not contribute to it. Salvation is a gift you receive or reject. It's not a joint-venture project. God doesn't need your help - only your faith.

Takin' Care of Business...

The Bush economy rocks. I'd donate money to help pay to put that ad on the air in heavy rotation. I'm an an American voter ... and I approve this message.

Host Your Blog Here?

I'm considering offering a small-scale blog-hosting service here at HobbsOnline - essentially, you would get a MovableType-powered blog site with a URL like http://www.yourname.billhobbs.com, and I'd provide blog design services, and maintain the technical side of things - and put a link to your blog in a prominent position on my home page separate from the blogroll. Searches run on my blog would generate results also listing entries from your blog. You'd also get an email address - yourname@billhobbs.com - and assistance learning the basics of using MovableType. I'd charge a minimal fee - $10 or $15 a month, payable via PayPal - to cover the increased bandwidth usage and the time I'd spend assisting you. This offer would be open only to bloggers of a conservative/libertarian viewpoint and if your blog began to draw significant traffic I'd assist you in moving it to your own independent URL.

Anybody interested? I'm planning on hosting no more than about 10 or 12 blogs.

Blogads & Big Media

Hugh McLeod thinks the decision by Time-Warner's RoadRunner subsidiary to run ads on blogs makes Blogads "the most under-reported media story I've ever come across." HobbsOnline's average daily readership Mondays through Friday is around 1,500 people per day - with occasional spikes to between 5,000 and 10,000 readers per day. You can reach them with your marketing message for as little as $20 per month (left side column, lower left) or $65 per month (right side column) or in the prime slot on the left side, where one space remains unsold, for $75 per month.

Be Careful What You Ask For

National Security Advisor Condoleeza Rice will testify in public under oath before the 9/11 Commission. The Democrats demanded it, though she already has testified for more than four hours in private, because the Democrats are politicizing the commission and, by extension, 9/11 itself. I rather suspect they'll rue the day they demanded Rice testify publicly. A brilliant African-American woman will soon be testifying in front of a sure-to-be-mammoth national TV audience, defending the Bush administration's record on fighting terrorism before 9/11 and since. Condi Rice may well do to them what Oliver North did in the 1980s when he made the Democrats on the Iran-Contra hearings look like fools.

LLC Data Project Update #10

Add North Carolina to the growing list of states where the formation of limited liability companies is setting records - indicating strength in the small business/entrepreneurial sector of the states economy that may be overlooked by the federal government's monthly jobs-growth survey of large employers. LLC formation set a record in fiscal year or calendar year 2003 in 22 of 25 states I've surveyed so far.

According to a spreadsheet of data emailed to me by the North Carolina Secretary of State's office, there were 20,538 domestic LLCs formed in North Carolina in 2003, up more than 23 percent over the previous record of 16,599
in 2002. it's also 220 percent more LLCs than entrepreneurs formed in North Carolina in 1999, the year the Clinton-era economic boom hit its peak.

LLC formation is setting records across the country, evidence of a booming small business and solo entrepreneur sector of the economy. The federal government's monthly Employer Survey focuses on large corporations, while the companion Household Survey is more likely to pick up new jobs created by small business and entrepreneurs. For more than a year, the Household Survey has shown strong job growth, while the Employer Survey shows a stagnant jobs picture.

LLCs are a favorite form of business structure for small businesses and entrepreneurs who are starting businesses.

I have now collected data on LLC formation in 25 states. LLC formation reached a new record high in fiscal year or calendar year 2003 in 22 of them: Alaska, Arizona, Connecticut, Delaware, Florida, Hawaii, Idaho, Illinois, Minnesota, New Hampshire, New York, Nebraska, North Carolina, North Dakota, Oregon, Pennsylvania, Rhode Island, Tennessee, Texas, Virginia, Washington and Wisconsin.

Utah set a record in 2002 and then declined slightly in 2003. Nevada and Kentucky set records set in 2002 and may have in 2003 - I have not been able to gather complete data for those states for 2003. I continue to seek data from the remaining 25 states.

For stats from other states, see my Economy & Business archives and then read the various LLC-related posts.

In related LLC news, University of Illinois law professor Larry Ribstein is also writing about LLCs - and why LLCs are replacing general partnerships and corporations as the preferred form of business entity, on his blog.

March 29, 2004

Exactly Right

Glenn Reynolds is exactly right about what Condi Rice ought to say in her opening statement if she testifies in public before the 9/11 Commission.

This administration came into office to discover that al Qaeda had been allowed to grow into a full-blown menace. It lost six precious weeks to the Florida recount – and then weeks after Inauguration Day to the go-slow confirmation procedures of a 50-50 Senate. As late as the summer of 2001, pitifully few of Bush’s own people had taken their jobs at State, Defense, and the NSC. Then it was hit by 9/11. And now, now the same people who allowed al Qaeda to grow up, who delayed the staffing of the administration, who did nothing when it was their turn to act, who said nothing when they could have spoken in advance of the attack – these same people accuse George Bush of doing too little? There’s a long answer to give folks like that – and also a short one. And the short one is: How dare you?

CLARIFICATION: Glenn Reynolds didn't author the above hoped-for statement from Condi Rice. He linked to and quoted from a David Frum column.

NYT To Begin Correcting Columnists' Errors

Robert Cox's New York Times columnist corrections project, which spawned the parody page that bloomed on various blogs after the NYT briefly tried to intimidate it off the web through assertions of dubious legal merit, has gotten results. It seems the NYT has come around to the blogosphere's way of thinking and will soon be publishing corrections when their various columnists make factual errors. Robert Cox has more comments here.

Kerry's Heresy

John Kerry, campaigning in a church without provoking the media into howls of anger at the breaching of the separation of church and state, accused America's "national leadership) (Read: President Bush) of having a "dead" Christian faith, in a spectacular misapplication of one of the most beautiful - and most misapplied - verses in the Bible. LaShawn Barber has some great commentary on the incident.

The flap revolves around James 2:14-17, which says...

What does it profit, my brethren, if someone says he has faith but does not have works? Can faith save him? If a brother or sister is naked and destitute of daily food, and one of you says to them, "Depart in peace, be warmed and filled," but you do not give them the things which are needed for the body, what does it profit? Thus also faith by itself, if it does not have works, is dead.

"The scriptures say, what does it profit, my brother, if someone says he has faith but does not have works? When we look at what is happening in America today, where are the works of compassion?

Christians who delegate their "good works" to government are robbing God of the glory for such works. Think about it. When government writes a welfare check or picks up the tab for a poor person's healthcare, who gets the glory? Government - and the politicians who proposed the program or voted for the increased funding. But when a Christian provides charity or help to their neighbor, they can easily give God the glory. You will never hear government tell a welfare recipient, "We're doing this in the name of Jesus."

Kerry badly misapplied James 2:14-17. Lots of people do, and in other ways than Kerry's mistake. Some will tell you James 2:14-17 lays out a formula for humans to achieve salvation - faith without works leads to death, therefore, faith+works=eternal life. That is perhaps a more dangerous heresy than Kerry's flip politicization of the verse because it asserts that human work and human actions contribute to salvation.

That's wrong.

Salvation was accomplished on the cross 2,000 years ago (See: The Passion of The Christ). It is received as a free gift of grace when you profess your faith in what God did, period. Salvation is powered by God, not by any human action other than faith. It is the height of human arrogance to assert that a human work contributes to salvation. Real faith as it matures produces action, but your good works do not contribute to salvation.

You are not saved because you give to the poor, or because you don't sin, or even because you "got baptized" and go to church. You are saved because you put your faith in Him and what He did on the cross and (that he emerged from the tomb three days later). To quote the author of salvation: "It is finished."

Three is Not One - Neither is 27

State Sen. Jim Bryson and his push for a Tennessee Taxpayers Bill of Rights gets a good mention in this AP story about how efforts are underway in several states to enact similar legislation. There's also a sidebar that further makes clear just how many "facts" were, uh, non-factual in the anti-Taxpayers Bill of Rights editorial in the Saturday Tennessean that I commented on yesterday. The Tennessean said Colorado is the only state with such a law now on the books. That's false due to oversimplification. While Colorado's law is considered the toughest cap pn spending, revenue and tax increases in the nation, both Oregon and Oklahoma also have limits on all three, according to the National Conference of State Legislatures. And...

Over the last 30 years, 27 states have adopted some kind of tax and spending limit, most of them in West and South. Limits on spending are the most popular with 19 states having adopted such restraints. Some limits are statutory, which gives lawmakers the power to change it, and others are constitutional, leaving the final word on changing them to voters.

You want accurate coverage and fact-based commentary on the proposed Tennessee Taxpayers Bill of Rights? Stick with HobbsOnline...

My Google Myself

Interesting story about Google in the Tampa Trib today.

If you haven't tried it yet, you will. Google yourself, that is. Vanity searching your own name is among the most popular ways to exercise Google. A survey by the Pew Internet Project found that nearly 25 percent of self-Googlers say they are stunned by how much information about themselves is online.

A Fact-Free Editorial

The Tennessean has weighed in with its editorial opinion of the proposed Taxpayers Bill of Rights amendment to the state constitution. Predictably, the paper is against it. What follows is the text of their editorial, interspersed with my response to it...

Passing the buck on taxes
Tennesseans who try to gauge the worth of a Taxpayer Bill of Rights by looking to the one state that has such a law aren't likely to come away any the wiser.

Colorado passed a Taxpayer Bill of Rights in 1992. Some observers say that the measure sparked great job creation over the next 10 years and helped Colorado weather the recession. Others believe it has locked the state into horrid policies, harming social services and education and ruining public universities.

Now, two state lawmakers would like Tennessee to adopt its own version of a Taxpayer Bill of Rights. The proposed amendment, sponsored by Sen. Jim Bryson and Rep. Glen Casada, both Williamson County Republicans, would limit the growth in state revenues by a formula to account for population growth, plus inflation. Revenue in excess of that amount would be returned to taxpayers. Voters would have to approve tax increases.

While this measure will have great appeal with some voters, it would mark a step away from representative government and from judgment.

Governing is a matter of setting priorities and making value judgments.

Tennessee expects its public officials and its legislators to avail themselves of more information on a given topic than is available to the general public.

The Taxpayer Bill of Rights, however, would lock in the state on fiscal policy matters.

Voters in Tennessee have traditionally demonstrated great common sense. They keep up with matters of state government as well as the citizens of any state. But there is a huge difference between a system where voters choose leaders and representatives and a system where voters actually use the ballot box to make routine governing decisions.

As for the budget and taxes, the amendment will continue to allow the legislature keep and spend about 6 percent more revenue each year just as they do now, and only involve voters and referendums if there's a large surplus above that revenue growth.

We're also talking about involving voters in the core decisions of a democracy - decisions about raising taxes or creating new taxes.

The best ways for state lawmakers to respect the rights of Tennessee taxpayers are through doing their homework prior to all votes and explaining their decisions to their constituents afterwards - not handing off decisions directly to voters and calling it a ''right.''

As for the one state that already has such an amendment on the books, here are some facts The Tennessean was too busy fretting about the danger of letting The People have a voice in matters of taxes and spending to bother to dig up and report to you.

Fact 1: By any reasonable economic measure Colorado's economy far out-performed Tennessee's since Colorado voters approved their Taxpayers Bill of Rights in 1992.

Fact 2: Voters in Colorado have sometimes voted FOR higher taxes and voted FOR letting government spend surplus funds.

Fact 3: Even former critics of the Taxpayers Bill of Rights in Colorado now say it has fostered greater citizen interest in and involvement in government, and fostered a greater sense of accountability and good fiscal management on the part of government while raising the level of the citizenry's trust in their government.

You can find all of those facts and much, much more in this white paper I wrote more than a year ago, and in my extensive archive of Taxpayers Bill of Rights information and commentary.

You could also have found it in a newspaper column I wrote that was published a little over a year ago. The Tennessean could have found it rather easily. They published it.

The Bush Boom Grows Louder

This is the kind of news that top Democrat strategists don't want to hear:

Employers soon will add jobs steadily as the economy continues to expand, say economists surveyed by USA Today. In an optimistic outlook, the 56 economists also predict businesses and consumers will continue to spend more as the unemployment rate falls. Inflation will stay low, they say, letting the Federal Reserve keep interest rates at historic lows a bit longer.

The predictions come as jobs take center stage in the presidential election. Democrats repeatedly note that there are 2 million fewer jobs in the USA since President Bush took office. Bush counters that the economy was declining before the last election and that the job market is poised to take off.

"I consider it a booming economy," says Timothy Rogers, chief economist at Boston-based Briefing.com, a site that provides data and analysis for investors.

Rogers and other economists are most heartened by the big pickup in business spending. Businesses sent the economy into a recession as they cut spending starting in late 2000. After picking up last year, business investment is expected to increase by double digits each quarter through 2004.

"Business looks really very, very good," Decision Economics President Allen Sinai says, noting that corporate profits are rising rapidly. That means firms can spend on new technology and other improvements.

They also may finally spend on hiring. In the survey conducted March 19-24, 31% of the economists said they expect hiring to begin in earnest in the second quarter. More than half expected considerable gains in the second half.

Economists say the economy is improving quickly enough that businesses will no longer be able to meet demand with their existing workforces.

When the LEFT Attacks

Some union thugs beat up a pro-Bush blogger - and some Democrats rush to defend them.

March 27, 2004

Amend the Amended Taxpayers Bill of Rights?

State Sen. Jim Bryson has responded to my criticisms of the amended version of the propsoed Taxpayers Bill of Rights amendment to the Tennessee state constitution. My criticism, in brief, were these: The new version uses a measure of economic growth that allows for maximum government spending growth and, because it is defined by the legislature and based on estimates the legislature can manipulate rather than a set of hard data, it is itself a loophole for higher spending. And it allows for caps on taxes and spending to be broken without a vote of the people. And it allows for new taxes to be imposed without a referendum if the legislature declares the tax reform package to be "revenue neutral."

Sen. Bryson responded...

"Economic Growth" is basically defined as personal income so the legislature cannot set its own rates whenever it pleases. The Copeland Cap has been overridden 11 of the past 20 years. It now requires a majority vote to override. Getting a 2/3 vote is very difficult yet allows for an override when there is consensus on the need. The point is that we need a has to be a hard cap that counts, yet gives some room for overrides when there is a consensus. This maintains that cap. Though the cap is arguably higher (about 1-2%/year) it is still a cap that will place a control on spending. I can't argue with you too significantly about the "tax neutrality" issue. Admittedly that is a potential loophole but it also gives the legislature the ability to address tax fairness. I hope we are still on the same side on this issue. Lets talk about it sometime soon.

We are still on the same side on this. I still like the TaBOR - just not as much. (But, then, I want a TaBOR with the local provisions like Colorado has!) I'll post part of your email below as a response to what I wrote, although I didn't see how it is defined as personal income. (Personal income is a lousy stat to use. Per capita income would be much better. Per capita income adjusted for inflation would be the best.) I think the tax neutrality issue is significant in that it opens a way for an income tax without a referendum. Perhaps you could alter that section to say that the legislature could adjust EXISTING taxes without a referendum provided it was revenue neutral, but new taxes would have to be voted on.

March 26, 2004

Digital Freedom Campaign

The fine folks over at the Tennessee Digital Freedom Network are planning an email-athon targeting the members of the Tennessee legislature's House Judiciary Committee, urging them to vote against House Bill 3391, an absolutely atrocious piece of legislation that is bad for Tennessee residents and bad for Tennessee business. You can read more about the email campaign - including a well-written letter that explains why HB3391 is so bad, here. Here are a few portions of the letter:

In their current form, these bills have several serious technical and constitutional flaws and could result in severe unintended consequences for the state of Tennessee. While they purport to only update Tennessee laws prohibiting theft of communications services, they in fact create a state-wide pseudo-copyright system, blurring the line between communication signals and copyright content. These bills originated from a bill drafted by the Motion Picture Association of America and sponsored by Senator Curtis Person and Representative Rob Briley. Though the bill has been modified throughout the legislative process, it unfortunately retains its focus on extending statewide copyright protection to communications content.

The bills are also unnecessarily restrictive on interstate commerce, subjecting manufacturers and retailers to potential civil and criminal liability for the sale of legal devices if a communication service provider alleges that they had the improper “intent” in doing so. On this basis, the Consumer Electronics Association, Consumer Electronics Retailers Association, as well as their members Radio Shack and Phillips Electronics, have come to Tennessee to oppose passage of this legislation. Unfortunately, potential defendants are under strong pressure to settle civil lawsuits because the proposed statutes would allow a civil litigant to seek statutory damages of $50,000.00 per device for each violation, although the device in question may be legally protected under federal copyright law. Retailers may also be charged in the state of Tennessee with a Class D misdemeanor for the sale of legal and federally protected devices. The effect this bill will have on the Tennessee economy is unforeseeable, but it will clearly send a signal to the business community that Tennessee is not friendly to technology and not friendly to innovation. This signal will hinder the ability of the state to attract new jobs and opportunities to the state, all to protect an industry which is already protected by federal copyright laws.

If you care about protecting your digital freedoms, remember to participate in the email campaign this coming Wednesday, March 31, from noon to five p.m. Tomorrow, I'll also post the House Judiciary Committee members' other contact info (phone, fax, mail) if you wish to contact them that way.

More on LLCs...

Prof. Stephen Bainbridge - a new and much-belated addition to my blogroll under "Business Blogs" - mentions the ongoing LLC Data Project and says he hopes I eventually collect all the data into one post. I am indeed going to do that, or compile it as a White Paper and post the paper here at HobbsOnline. I still have to finish collecting the data first...

Meanwhile, here's a link to where you can download a paper that Prof. Bainbridge, who is a UCLA law professor, wrote a few years ago on limited liability companies, titled Limited Liability Companies: A Primer on Value Creation through Choice of Form The summary of the paper says: "Using a transaction cost economics framework, the article explains how structuring a business as a LLC can create value. The article discusses taxation of LLCs, their organizational flexibility, and the limited liability they provide members."

The Bush Boom: Lowest Poverty Rate in Decades

Chuck Simmins looks at data showing that the economy of George W. Bush has produced the lowest poverty rate in a generation, and wonders why he hasn't seen that news in the paper.

Simmons links to the official Census data on poverty rates back through 1959. The data clearly shows that poverty rates for Americans and American families has dipped to the lowest levels in a generation.

Chuck is right - why don't we see that news on the front page of the New York Times, and leading the nightly newscasts?

LLC Project Update #9 Connecticut, Arizona

Add Connecticut and Arizona to the growing list of states where the formation of limited liability companies is setting records - indicating strength in the the small business/entreprenuerial sector of the states economy that may be overlooked by the federal government's monthly jobs-growth survey of large employers.

According to data posted online by the Connecticut Secretary of State's office, there were 19,118 domestic LLCs formed in Connecticut in 2003, up slightly over the previous record of 19,040 in 2002. LLC formation surged in Connecticut in 2002, up 18 percent over 2001

According to data posted online by the Arizona Corporation Commission for fiscal years 1999-2000 (page 21), 2000-01 (page 18), and 2001-02 (page 18), LLC formation set a new record in Arizona in fiscal year 2002.

In fiscal year 2001-2002, Arizona entrepreneurs started 16,996 new limited liability companies, up 15 percent over fiscal year 2001, and up 32 percent over fiscal year 1999-2000, which covers the final months of the Clinton-era economic boom.

A report for Arizona FY 2003 is not yet online - I have requested a copy of it and, if and when I receive it, I'll post an update here to Arizona's numbers.

LLC formation is setting records across the country, evidence of a booming small business and solo entrepreneur sector of the economy. The federal government's monthly Employer Survey focuses on large corporations, while the companion Household Survey is more likely to pick up new jobs created by small business and entrepreneurs. For more than a year, the Household Survey has shown strong job growth, while the Employer Survey shows a stagnant jobs picture.

LLCs are a favorite form of business structure for small businesses and entrepreneurs who are starting businesses.

I have now collected data on LLC formation in 24 states. LLC formation reached a new record high in fiscal year or calendar year 2003 in 21 of them: Alaska, Arizona, Connecticut, Delaware, Florida, Hawaii, Idaho, Illinois, Minnesota, New Hampshire, New York, Nebraska, North Dakota, Oregon, Pennsylvania, Rhode Island, Tennessee, Texas, Virginia, Washington and Wisconsin.

Utah set a record in 2002 and then declined slightly in 2003. Nevada and Kentucky set records set in 2002 and may have in 2003 - I have not been able to gather complete data for those states for 2003. I continue to seek data from the remaining 26 states.

For stats from other states, see my Economy & Business archives and then read the various LLC-related posts.

Thanks to reader and blogger Chuck Simmons for finding the Arizona and Connecticut stats for me.

Kerry Campaign Poster #2

Here is another suggested poster for John Kerry's campaign, courtesy of Randal Robinson:

I like this one too.

"Fair Tax" News

Here's more on the "Fair Tax" prosal that I mentioned in a post yesterday about Georgia congressional candidate Robert Lamutt.

In a preview of the GOP agenda after the fall election, House Majority Leader Tom DeLay, R-Texas, says they are determined to repeal the federal income tax. Long an advocate of a national sales tax, a confident DeLay told a conference of tax lobbyists Wednesday that House Republicans will have hearings and push the issue in 2005 and 2006.

He said that replacing the income tax, payroll and other related federal taxes would provide more money for people to use and he endorsed a proposal from Rep. John Linder, R-Ga., for a national sales tax. However, he added that even a flat tax would be a better than the current federal tax model.

The Essence of John Kerry

The New York Times captured the nuanced essence of John Kerry perfectly in a headline two days ago:

In Fights Over Telecom Issues, Record Shows, Kerry's Worked on Many Sides

March 25, 2004

Lamutt for Congress

You may notice on the left side column an advertisement for Robert Lamutt, who is running for Congress in Georgia. He has to win the primary first - the district is heavily Republican, though, so the winner of the July 20 primary should easily win the November election. If I lived in the district, I'd vote for Lamutt, who has represented Georgia’s 21st district in the Georgia Senate since 1996.

Robert Lamutt is a Reaganite fiscal conservative, stemming from his experience as a small business owner. He has a BBA and MBA in finance from the University of Georgia. This year as a state senator, Lamutt authored reforms in Georgia's worker’s compensation and unemployment tax laws - saving Georgia businesses $200 million via reduced taxes. Lamutt also authored Georgia's Electronic Commerce and Digital Signatures Act, which became a model for national law.

Lamutt is a supporter of legislation offered by U.S. Rep. John Linder (R-Ga) to scrap the IRS and institute a "Fair Tax" - essentially a flat-rate national sales tax. It's an idea I also support.

He will make a great member of Congress. I urge you to visit his website (click the ad) and make a donation to his campaign.

The Bush Boom

President George W. Bush: Rebuilding the economy by inspiring entrepreneurs. Hah! But I suspect GWB will have the last laugh.

LLC Data Project Update #8: Texas

Judging from the number of limited liability companies formed in Texas last year, the small business/entreprenuerial sector of the Texas economy has never been stronger as Texas is yet another state were LLC formation set a record in 2003.

According to data provided by the Texas Secretary of State's office,there were 92,444 domestic LLCs formed in Texas in fiscal year 2003 (Texas' fiscal year runs September-August). That's up 7 percent over fiscal year 2002 - and up 77 percent compared to fiscal year 2000, which includes the period from September 1999 through August 2000, the peak of the Clinton-era economic boom.

As we have seen already, LLC formation is setting records across the country, evidence of a booming small business and solo entrepreneur sector of the economy. The data from Texas gives further creedence to the notion that the federal government's monthly Employer Survey, which focuses on large corporations, is not providing an accurate picture of job growth in America today. The Household Survey, more likely to pick up jobs created by small business and entrepreneurs, shows stronger job growth. LLCs are a favorite form of business structure for small businesses and entrepreneurs who are starting businesses.

Texas is the 22nd state for which I have collected data, and the 19th in which LLC creation reached a new record high in fiscal year or calendar year 2003. The others are Alaska, Delaware, Florida, Hawaii, Idaho, Illinois, Minnesota, New Hampshire, New York, Nebraska, North Dakota, Oregon, Pennsylvania, Rhode Island, Tennessee, Virginia, Washington Wisconsin.

Utah set a record in 2002 and then declined slightly in 2003. Nevada and Kentucky set records set in 2002 and may have in 2003 - I have not been able to gather complete data for those states for 2003. I continue to seek data from the remaining 28 states.

For stats from other states, see my Economy & Business archives and then read the various LLC-related posts.

March 24, 2004

Cutting Spending Leads to Increased Popularity

From the Heritage Foundation:

Conventional wisdom has long held that voters punish politicians who cut government spending. If this was ever the case, it is no longer, write Heritage's Keith Miller and Alison Fraser. Governors Jennifer Granholm (D-MI), Tim Pawlenty (R-MN), Phil Bredesen (D-TN), and Arnold Schwarzenegger (R-CA) have all worked to balance their states' budgets by cutting spending, and without raising taxes. All of them have seen their popularity grow in the process.

Despite what some politicans seem to think, voters aren't dumb: they understand how budgets work and they respect lawmakers who keep a tight grip on the public purse. And as Miller and Fraser show, the converse is true as well. "Out-of-control spending," they write, "is a guaranteed way to lose constituents' trust." Read Cutting Spending and Living to Tell About It by Keith Miller and Alison Fraser

LLC Data Project Update #7: Delaware

A record number of limited liability companies were formed in Delware in 2003, more evidence that the current economic recovery is powered by small business and entrepreneurs whose jobs often don't show up in the federal government's official jobs growth survey of large employers.

According to a spreadsheet emailed to me by the Delaware Department of State, Division of Corporations, 53,926 limited liability companies, or LLCs, were formed in Delaware in 2003, about 13.5 percent more than in 2002 - and 34 percent more than the 40,009 formed in 1999, the peak year of the last American economic boom.

Why so many LLCs formed in tiny Delaware? It has some of the most pro-business incorporation laws in the country, so it is the state of choice for many entrepeneurs to register their businesses.

The data Delaware sent me is intriguing. Unlike most of the 20 other states I've looked at so far, Delaware actually saw a significant decline in the formation of LLCs between the end of the last economic boom and the start of the current Bush Boom. As the Clinton economy tumbled into recession at the end of 2001, Delaware was just finishing its best year ever for LLC formation - 47,904. But in 2001, that declined over 9 percent to 43,272 LLCs. It began to rebound in 2002, almost equaling the year 2000 peak, and then set a record in 2003.

(One caveat about the Delaware data - they have not finished the tally for the last two months of 2003, and so provided me full-year data for 2003 by including for November and December a number equal to the monthly average for the year.)

Delware is the 21st state for which I have collected data, and the 18th in which LLC creation reached a new record high in 2003. The others are Alaska, Florida, Hawaii, Idaho, Illinois, Minnesota, New Hampshire, New York, Nebraska, North Dakota, Oregon, Pennsylvania, Rhode Island, Tennessee, Virginia, Washington Wisconsin.

Utah set a record in 2002 and then declined slightly in 2003. Nevada and Kentucky set records set in 2002 and may have in 2003 - I have not been able to gather complete data for those states for 2003. I continue to seek data from the remaining 29 states.

For stats from other states, see my Economy & Business archives and then read the various LLC-related posts.

As Amended... It's Got Problems

The proposed Taxpayers Bill of Rights amendment for the Tennessee state constitution has been rewritten by its sponsor, and while the new version may have a better chance to pass through the legislature, that will be because the new has greatly weakened the protections the proposed Taxpayers Bill of Rights would give Tennesseans against higher taxes and out-of-control government spending. It has two major weaknesses that absolutely must be addressed.

Blake Wylie has posted a PDF of the new version of the bill here. The original version is here.

Weakness Number 1:
1. It no longer establishes a formula for calculation the maximum growth of government spending in a given fiscal year. The original version established a specific formula based on the inflation rate and population growth, as defined by the language of the amendment - but the weakened version now simply says the cap on spending growth is to be based on

the total state tax revenue expenditures for the fiscal year in which this amendment is ratified plus the estimated rate of growth of the state's economy, as defined by law, for each fiscal year following ratification of this amendment plus the amount of any duly authorized TABOR cap exceptions.

This merely replicates a major weakness of the current spending cap in the Tennessee constitution, the "Copeland Cap" enacted in 1978, which has failed miserably.

Under the Copeland Cap, the legislature currently is prohibited from increasing spending faster than the growth rate of the economy "as defined by law," unless they vote to exceed it. So each year they do a little legislative Kabuki dance in which they adopt an official "estimate" of the growth rate of the economy that is, as "defined by law," based on a statistic chosen because it allows for maximum growth of spending.

And, for 11 of the past 19 years, they followed that with an encore: a vote to break even that cap and spend even more money. Since 1985, the Tennessee legislature has broken the Copeland Cap on spending by a cumulative of $3.1 billion in just the first year of each busted-cap budget. The growth formula the legislature adopted as per the Copeland amendment allowed for state spending to grow 5.5 percent per year over the last 19 years. The budget-busters on Capital Hill have instead increased spending by 7.3 percent per year.

The only difference, then, is that the Copeland Cap could be broken by a simple majority vote, while Bryson's amendment would raise the bar to require a two-thirds majority vote.

Weakness Number 2:
The new version of the proposed Taxpayers Bill of Rights amendment says:

Any law imposing a new state tax or increasing the rate of any existing tax must be approved in advance of implementation by a majority of voters participating in a statewide referendum, unless the fiscal impact of the law will be revenue-neutral relative to overall state tax revenue collections

A strength of the original version of Bryson's amendment was that any new tax had to be voted on, even if it was part of a revenue neutral tax reform plan. One reason that was a strength - if and when the day comes back around that the pro-income tax forces in Tennessee try again to create a state income tax, they would be forced to craft a reform package that would appeal to the majority of voters.

Indeed, one of the primary positives of a Taxpayers Bill of Rights is how it will re-engage the public in discussions about public policy priorities, taxes and spending. But that can't happen if we continue to allow the legislature to break the spending cap without getting permission in a referendum, if we continue to allow the legislature to define the spending-growth formula on terms favorable to its desire to spend, and we continue to allow the legislature a loophole to impose taxes without a referendum.

Bryson's original Taxpayers Bill of Rights proposal meant Tennesseans could not be saddled with an income tax without approving it in a referendum. It also created a way for those who favor an income tax to more easily pass one through the legislature, as a ballot question. The new version of Bryson's amendment continues the current scenario in which a legislature can pass an income tax over the people's objection, even though it violates the state constitution, if the legislature believes it has finally stacked the state Supreme Court with enough pro-income tax judges who will overturn three past unanimous rulings.

I think I know why Sen. Bryson altered his amendment - he wants to pass it, and opponents say the revenue growth formula was too rigid and stingy. And the proposed amendment faces an uncertain future in the Senate Finance, Ways and Means Committee, where few of the 11 senators are thought to support the Taxpayers Bill of Rights concept.

But he has gone too far to appease them.

A good and effective Taxpayers Bill of Rights will take politics out of the calculation of the economy's growth rate and make it impossible for the legislature to play the kinds of games with revenue and growth estimates that the legislature has been playing for years. You know how it has worked in recent years - the (previous) governor and his cronies deliberately overestimate revenues, budget that much to spend, and then, when revenues come in less than the estimate, they blamed the tax code instead of their bought-and-paid-for state economist/income tax shill and demanded a tax increase to cover the "shortfall."

Without a fixed formula for calculating how much more the legislature can tax and spend each year before they have to ask voters permission, the Taxpayers Bill of Rights Sen. Bryson is proposing will have not much more positive impact than the Copeland Cap. In fact, it may be worse - as, if it were to pass the legislature and be adopted into the constitution by voters and then fail to restrain spending, six years of effort will have been wasted, the public's confidence in their ability to affect positive change will be damaged - and future attempts to amend the constitution with a real Taxpayers Bill of Rights will be viewed with skepticism, cynicism or indifference.

That would be even worse than the excessive spending and taxation that would be almost certain to continue even if this current version of the proposed Taxpayers Bill of Rights becomes law.

Perhaps the best we can hope for now is that this weak version of the proposed amendment has been weakened enough to get it passed the Senate Finance Committee – and that it can be strengthened at later stages of the legislative process.

Do The Math: Kerry's Numbers Don't Add Up

If elected, John Kerry would have to raise taxes by $1 trillion more than he's already planning to do, just to cover all his proposed new government spending and keep his promise to cut the federal budget deficit in half over four years. It's a tax - and credibility - gap.

Senator Kerry’s numbers do not add up. His proposed "tax increases on the rich" would only yield approximately $650 billion over ten years, but that does not come close to paying for his $1.7 trillion in spending. There is at least a $1 trillion tax gap between his spending increases and his tax increases. Given his pledge to cut the deficit in half over four years, his $1 trillion tax gap will only go up and will result in new taxes for every American.

$1,550 a year is enough for an average American household to replace an aging washer-dryer set, or some old furniture, or take an average vacation that might not thrill John Kerry, with his multiple million-dollar homes across the country and in Europe, but would which the average American would find relaxing and enjoyable. $1,550 a year is enough to help some folks pay off their car a little quicker, contemplate moving to a larger house to accomodate their growing family, or buy a new computer so they can start a little business on the side.

$1,550 is $29.80 a week. If, instead of sending it to Washington to pay for John Kerry's promises, you put that $29.80 each week into an investment earning just 5 percent interest, at the end of 10 years you would have $20,095. That would be a decent start on a college fund for the average American household's above-average children.

All of that is at risk because John Kerry won't stop promising new spending - and won't tell the average American people the real truth about what a Kerry presidency would really cost them.

Owens in 2008

From the Department of Looking Too Far Ahead: I hereby issue my early endorsement of Colorado Gov. Bill Owens for President. Read more about him here (and you'll also find Gov. Owens mentioned in several posts in my blog archives, via the search function). Arizona Republic political columnist Robert Robb writes:

Owens has benefited from his association with the Colorado Taxpayers' Bill of Rights. He was one of just nine state legislators to support it when voters approved it in 1992. The initiative capped state spending at population growth plus inflation. Any surplus revenue has to be rebated. This helped Colorado avoid the spending spree that consumed Arizona and most other states in the late 1990s, and created such gaping deficits when revenues got whacked by the recession. The rebates also proved politically popular.

John Kerry: Mr. No

You've seen the list of all the major weapons systems John Kerry sought to kill during his rabidly anti-defense career in the U.S. Senate. But voting against weapons systems in peacetime is one thing, voting to cut off funding for soldiers in a combat theater is something else. I wish this Bush ad coould air nationally a thousand times a day until every American has seen it.

March 23, 2004

Kerry Campaign Poster

Memphis Mike Hollihan has created two very appropriate campaign posters for John Kerry. Here's one:

Click here for the other one. And check out Mike's blog from time to time.

LLC Data Project: Impact Update

I received an email inquiry from a research assistant working for a very well-known and influential group of economists asking me to forward to this organization of notable economists every scrap of data I've collected on what looks to be a nationwide trend of record-setting formation of limited liability companies - a preferred business structure for small businesses and entrepreneurial start-ups - nationwide. Naturally, I forwarded them the data - and will continue to do so as I gather it from other states. I'll keep you posted...

Taxpayers Bill of Rights Moves Forward

The proposed Taxpayers Bill of Rights amendment to the Tennessee state constitution is still alive in the state legislature after the Senate Judiciary Committee today simply passed the proposed amendment on to the Senate Finance Committee without voting on it. That means none of the nine members of the Senate Judiciary Committee was recorded as voting either for or against TABOR.

Two of the members of the Judiciary committee - Sen. David Fowler and Sen. Joe Haynes - are also members of the Finance committee. The other nine members of the Finance committee are Sen. Douglas Henry, Sen. Jim Kyle, Sen. Bill Clabough, Sen. Ben Atchley, Sen. Tim Burchett, Sen. Ward Crutchfield, Sen. John Ford, Sen. Roy Herron, and Sen. Ron Ramsey.

Blake Wylie reports the bill possibly has been amended, but I haven't heard that (or at all) from Sen. Jim Bryson, the lead sponsor of the proposed amendment.

We'll bring you contact information and information about which senators are for or against the amendment, or on-the-fence, as soon as we have it. For more on the Taxpayers Bill of Rights click here.

Pictures of the Modern American Left

Here are some good photo essays on a very significant part of the Democratic Party. Just call them John Kerry's base. [Found it via Michael Williams]

New Ad Spot

I've added one more place for advertisers to place ads on HobbsOnline - the spot to the left that had been occupied by a Google AdSense box. I'll accept no more than two ads in the spot at a time, with the top spot placement on a first-come first-served basis. Maximum ad image size: 125 pixels wide, 125 pixels tall. Click here to buy space.

From a Newsweek story about Google:Meanwhile, Google has innovated with a program it calls AdSense, which places ads on web sites that don't belong to Google - other businesses, nonprofit or academic institutions and even blogs. The effects are only gradually becoming apparent. Software designer Tim Bray was impressed when he signed up for AdSense ads on his blog – he says it changed an expensive hobby to a profitable sideline – but worries that the pressure to expose the ads to new users might tempt people to alter their content to boost ad revenue. I haven't found AdSense to be anwhere near lucrative enough to offer such temptation - it's generated just $12.47 for me in the two weeks since I launched it. Google doesn't pay much for click-throughs.

That's why the spot near the top of the left side column that used to hold GoogleAdsense ads now is reserved for real advertisers placing real ads via Blogads.

Econopunditry

Instapundit has a very interesting reader-involved post going about the Bush tax cuts and their stimulative effect on the economy. Readers are telling their own stories of how the Bush tax cuts are changing their finances for the better. The tax cuts are stimulating folks to support President Bush. And Instapundit's post is bound to have a stimulative effect on one of HobbsOnline's key sponsors...

Kerry: Bad for America's 78 Million Investors

Some 78 million Americans own shares of corporate stock or equity mutual funds, and 55 million Americans that have a 401 (k) plan, so it's worth noting that Sen. John Kerry's record as a legislator has been unrelentingly hostile to investors, according to a new report from the American Shareholders Association, which says that two out of every three people who vote in the November 2004 election will be investors.

The report is online here in a 23-page PDF file. Here's the press