MUTH'S TRUTHS 08/08/2011

GOIN’ ON VACATION Taking the family on our annual two-week camping trip to Campland on the Bay in San Diego.  Hold down the fort while I’m gone. RULES OF (DIS)ENGAGEMENT “A helicopter crash killed 31 U.S. special operations forces and seven Afghan troops in Afghanistan’s central Wardak province,” the Wall Street Journal reported early Saturday morning.  “The chopper, a Chinook, was shot down by a lone militant using a rocket-propelled grenade Friday night as it was taking off after a night raid, an Afghan government official said. The Taliban claimed responsibility for the attack.” If this war-zone loss of life can in any way be attributed to our current Rules of Engagement (ROE) which ties our troops’ hands behind their backs rather than let them, you know, fight and kill the enemy instead of them killing us….heads should roll at the Pentagon, big time. Either that, or fold up our tent and bring the boys and girls home IMMEDIATELY. MUTH’S TWUTHS ON TWITTER Click here to follow me on Twitter: http://twitter.com/ChuckMuth TAX-REFORMERS MISSING THE BOAT David Schwartz of the Las Vegas Sun reported on Sunday that “business leaders and labor leaders are talking about forming a pro-tax coalition, saying they are frustrated by lawmakers’ inability to change the state’s revenue structure….”  The problem is, has been, and will continue to be that such folks are being dishonest in stating their intentions.  If they ONLY focused on tax reform in a revenue-neutral fashion, there are Republicans, and maybe even some conservatives, who would go along with the proposal….providing certain hard restraints on future spending are included in the deal.  But these “revenue structure” advocates refuse to consider reforming the state’s tax structure unless it simultaneously includes a net revenue increase in the amount of funding for the state government. Some on the Left love to say that conservatives who refuse to consider tax hikes are irresponsible and closed-minded.  But the folks who really have closed minds are those who claim the state needs a broader tax base but refuse to work with conservatives to broaden it UNLESS it also results in a tax increase. Tax reform and revenue restructuring could be in play if these self-appointed business and union leaders start reaching out and including conservatives such as Geoff Lawrence of NPRI and Adam Stryker of Americans for Prosperity in their talks. Otherwise, it’s all just a major public policy fraud and they’re likely to continue being frustrated by legislative inaction….thanks to their own pig-headedness. HECKUVA HELLER FUNDRAISER Nora and Bruce James will be hosting a fundraising event at their Lake Tahoe home in Crystal Bay, Nevada on Tuesday, August 16, 2011 for Sen. Dean Heller featuring special guest Nevada GOP Chairman Amy Tarkanian.  The reception will run from 6-7 pm and with a suggested donation of $100 - $250 per person.  Or attend the reception and a private dinner immediately thereafter for $2,500 per person.  Valet parking will be provided.  Reception is on the lawn, so no high-heels, please.  To RSVP or get additional information, please contact Tim Perez at (702) 242-1414 ortperez@deanheller.com HOW TO SUBSCRIBE TO MUTH’S TRUTHS If you or someone you know wishes to subscribe and receive Muth’s Truths delivered directly via email, please click here to sign up. MAIN STREET’S e-VOODOO TAX I just returned from an annual meeting of state legislators in New Orleans at which I attended a briefing on what proponents are misleadingly and disingenuously calling the “Amazon Tax.”  A better name, considering all the hocus-pocus and black magic surrounding it, would be the e-Voodoo Tax. Simply put, the tax would apply to purchases made over the Internet by people who don’t live in the state where the Internet retailer is located.  It’s being pushed by traditional brick-and-mortar retailers who are trying to stick it to online competitors. After all, misery loves company. It’s also being pushed by big-government legislators who suffer an insatiable desire to constantly find new ways to suck money out of the private economy and into the black hole of government operations and programs. Supporters call it the Amazon Tax because Amazon.com is the nation’s leading online retailer…and because it’s always easier to sell a tax on a big, bad corporation than it is to tax the “little guy.”  But that itself is the first big hocus-pocus fraud of this issue. You see, Amazon won’t pay the tax; YOU will.  If e-VooDoo Tax efforts are successful, when you pay twenty bucks to purchase a book online, Amazon will charge you an extra $1.20 “use” tax for the privilege – or whatever the going “use” tax rate is.  Notice my use of the word “use” rather than “sales” here. That’s because that’s the second little bit of black magic proponents are using to foist this tax on the American consumer.  You see, states aren’t allowed to reach across state lines and charge a “sales” tax on purchases its citizens make in another state.  Commerce clause and all that.  So what the sneaky little SOB tax addicts did many years ago was create a “use” tax instead.  And according to the Nevada Department of Taxation, this “use” tax “is imposed on tangible personal property used in Nevada on which Sales Tax has not been paid.”  In other words, out-of-state purchases. Now, most people assume this means merchandise purchased through toll-free numbers, from a catalogue or over the Internet.  And it does.  But guess what?  That t-shirt you purchased while on vacation in Orlando at Disney World?  You probably owe a “use” tax on it because, again according to the Department of Taxation, “Most goods, wares and merchandise are taxable.” “But wait,” you say.  “I paid Florida sales tax on that Pluto baseball cap.  Wouldn’t this be double taxation?” Why, yes it would.  So guess what?  Nevada “graciously” recognizes the sales taxes paid to another state.  However, “if the Sales Tax paid is less than 8.10% then the difference needs to be reported as Use Tax” in Nevada. So let’s say you pay $17.95 for a Pirates of the Caribbean souvenir plastic sword. The “use” tax you owe Nevada for letting your kid “use” it in your backyard would be $17.95 times 8.10%....or $1.45. But since Disney collected the Orange County sales tax of 6.5% at the point of purchase…or $1.17….you get to deduct the $1.17 from the $1.45 you owe in Nevada “use” tax and, therefore, only have to remit 18-cents to Nevada.  Woohoo! Of course, almost no one even knows they owe this “use” tax on merchandise they buy on vacation or otherwise out-of-state.  And because such sales are virtually impossible to identify and collect from individual “tax cheats” like you, you can see why the government is trying to force online retailers such as Amazon.com to do its dirty work for them. Again, this whole thing is nothing more than a desperate scheme by greedy government apparatchiks to suck more money out of your wallet and mine.  The “use” tax itself is an evil attempt to get around interstate constraints on the imposition of sales taxes.  So instead of trying to get online retailers to collect this insidious tax, all “use” taxes should be repealed outright.  So let it be written; so let it be done. FAMOUS LAST WORDS "The political brinksmanship of recent months highlights what we see as America's governance and policymaking becoming less stable, less effective, and less predictable than what we previously believed.  The statutory debt ceiling and the threat of default have become political bargaining chips in the debate over fiscal policy. Despite this year's wide-ranging debate, in our view, the differences between political parties have proven to be extraordinarily difficult to bridge." - Standard & Poor's statement on why it reduced the nation's rating from AAA to AA+ “This announcement is probably long overdue.  For decades, political careerism has trumped statesmanship in Washington.  Both parties have done what is safe, not what is right.  The dysfunction in Washington is the belief that we can live beyond our means forever.  We can't.  The moment to make the hard decisions we have long avoided has arrived.  There is no where left to kick the can." - U.S. Sen. Tom Coburn, M.D. (R-OK), 8/6/11 “On Tuesday, April 19, 2011, Treasury Secretary Tim Geithner promised that America faced ‘no risk’ of a credit downgrading. Less than four months later, he is proven shamefully wrong. . . . This is a sad day for America. Such a rating is unfitting of the greatest and most prosperous nation the world has ever known. And such a weak leader is, as well.” -  Republican presidential candidate Herman Cain, 8/6/11