Center of the American Experiment Celebrates its 25th Birthday!

The Center of the American Experiment celebrated its 25th birthday last night at its annual dinner. Gopher State Politics Institute staff was honored to attend the celebration, along with over a thousand friends of the Center.

Not only did we enjoy great food and enlightening conversation, but we also had the pleasure being entertained by P.J. O'Rourke, the great Political Satirist and Author.

Happy Birthday to the Center of the American Experiment and a special thanks to Mitch, Kim and staff. Keep up the great work.

Bob Smith, 3rd

http://www.americanexperiment.org/

Estate Tax Shoos Away Snowbirds by KIM CROCKETT - Published February 8, 2015-Star Tribune Op-Ed

Great op-ed by Kim Crockett of the Center of the American Experiment. Please share it with your friends and associates!      Bob Smith

***

Estate Tax Shoos Away Snowbirds by KIM CROCKETT - Published February 8, 2015-Star Tribune Op-Ed
Of course, they’ve paid their "fair share." And once they go South, they’ll be donating elsewhere.

http://www.startribune.com/opinion/commentaries/291113251.html

In a ritual familiar to many Minnesotans, I recently made plans to visit my mother in Florida. When I called to compare calendars, she surprised me. After just a few months as a new snowbird, she is thinking of becoming a resident of Florida. "We are happy to pay the taxes, but the estate tax is another matter," she said.

Several years ago, my mother and stepdad moved from the Land of 10,000 Taxes back east to "Taxachusetts," where many of her college pals and family members still live. All of her estate planning to this point assumed she’d die a resident of Massachusetts, which has an estate tax similar to that of Minnesota and a dozen other states.

While my mother adores Massachusetts — Sen. Elizabeth Warren and all — she is a thrifty and savvy planner and hopes to leave resources behind, primarily to help a family member with special needs. She is one of those "Happy to Pay" folks, but has found her limit: She is not happy to pay a death tax. Florida has none.

I work for a nonprofit focused on public policy, so this issue is of interest — not just as a matter of good tax policy, but for our organization’s future (and I assure you for the future of every other nonprofit in Minnesota). More important, it is vital for our state’s future.

When I was making calls to donors in December, I had many similar conversations to the one I had with my mother. Too many of the people I reached had either relocated or were thinking about it. In comparing notes with other nonprofits, I found that we are all hearing the same thing: a growing part of our donor base is leaving as baby boomers retire but also as younger, more mobile people are headed to a better climate for taxes or weather, or both. This is laid out in stark detail by data from our state demographer in a report called "Minnesotans on the Move."

One donor told me that when he and his wife retired, they stuck around. This was home. They were looking forward to giving lots of time and money to the Rochester area, including a large donation to a local foundation. Over time, they were deeply offended by the (false) idea that they had not paid their "fair share" in taxes or that somehow they had not earned their success. They knew where they came from and how hard they had worked. Yet my donor stayed, continuing to pay taxes and to give generously to nonprofits.

The tipping point came with the estate tax, which my donor called "a tax on my children." He estimated the cost of Minnesota’s estate tax. Rather than pay the tax, he bought a house in Florida for less than what he would have paid in estate taxes and became a Florida resident. Instead of paying estate tax, his children are going to inherit a five-bedroom house in Florida.

Once people leave the state, they shift their lives and donations to their new communities.

Vance Opperman observed in Twin Cities Business that while Minnesota has a lot to offer, we have a problem: "the constant rhetoric attacking rich people, people that aren’t morally [willing] to pay their fair share, I resent. … And I frankly think the constant effort to harass people of wealth has a secondary but negative effect. When people make their first big hit, their first big capital gain, you want them to stay here. You want them to fund the orchestra, to fund foundations. You want them to continue to contribute to our society, to start venture capital, to invest in new businesses. And if you chase those people out because they think they’re not wanted, or if you chase those people out or you don’t attract people who are mobile, you will have a decline in many of the amenities we’ve just been talking about."

You might be thinking, "Good riddance. Who needs Richie Rich anyway?" I got a full helping of such green-eyed rhetoric last week at the State Capitol. In recognition of the exodus caused by the estate tax, both the Senate and the House are hearing bills that would either repeal the tax (best scenario) or bring the tax in line with the federal estate tax (good enough compromise).

While most legislators seemed to get the problem, during one hearing a state representative mocked the idea of helping "rich guys with three yachts on Lake Minnetonka." Another compared certain untaxed stock gains to a lottery windfall. The estate tax, it was argued, was our defense against an aristocracy.

This is how we end up with family farms and businesses being sold to pay taxes. But I get that fear about accumulated wealth. I worry about it, too. I do not want to be bossed around by Richie Rich, either.

I am reassured by two things. First, most wealthy Americans build and earn their success and then give a lot of it away to hospitals, schools, the arts and even policy organizations. Very few inherit great wealth. When they do, they arrange for their estates to be out of the reach of Minnesota’s estate tax. Second, inherited wealth is often morally debilitating. It’s like people who win the lottery; many end up with nothing — or with serious problems — because they did not earn it.

So I do not worry about aristocracy. I worry about all of the farmers and small-business owners who do not have yachts or untaxed stock gains but instead have lots of valuable acreage or capital equipment that puts them right in Minnesota’s estate tax bull’s-eye. I don’t think they should pay for the farm twice: first in property and income taxes, and again when they have gone to their peace.

I want them and their heirs to stay put and call Minnesota home, to keep working that farm or growing that business.

***

Kim Crockett is chief operating officer of Center of the American Experiment, devoted to Building a Culture of Prosperity in Minnesota and the Nation

Remembering Pearl Harbor...

On December 7, 1941, Pearl Harbor was attacked.  Minnesotans played a predominant role, firing the first shots that sank a Japanese Midget Submarine.  We honor those who lost their lives that day.

http://mn.gov/mdva/memorials/usswardgun.jsp

P.S. - We did visit the Oasis Café in Stillwater, Minnesota on November 6, 2014

Road Trip...

My daughter and I decide it was a worth a trip to Stillwater to see the Oasis Cafe in person.  We arrived just in time for a late breakfast or early lunch on November 6th.  We were lucky enough to meet the owner Craig Beemer, who was right in the middle of making a bunch of homemade pies. 

We had a great conversation and thanked him for alerting us all to extra fees on many of our bills.  He said he was not trying to make a political statement when he figured out what the additional costs of the minimum wage hike would be for his business.  He was just trying to inform his customers of the added cost.

Thank you Shannon, our server, she is part of the hard-working crew at the restaurant.  They are good, solid working people.  I look forward to a return trip for some more of that delicious pie!

Liz Prokosch,Shannon, Bob Smith

Bob Smith 3^rd

bob333smith3rd@gmail.com

GopherStatePolitics.com

Minimum Wage Hike $.35 cents… $.99 cents… More?

Stillwater, MN

There’s no such thing as a “free lunch”… even when mandated by Government?

In August 2014, there was a flap over a .35 cent minimum wage fee charged at a Stillwater, Minnesota restaurant that went viral nationally and caused quite a furor.  It seems that Craig Beemer, owner of the Oasis Café, figured out that the new minimum wage rate would add an additional expense of .35 cents per customer ticket.  The itemized receipt read a subtotal of the food items, next line Sales Tax, next line Minimum Wage Fee .35 cents, and then the Total that became the New Balance Due.

Minimum Wage Fee - Oasis Cafe

Honesty doesn’t pay. The screams of greed and national TV uproar reverberated across the land.  He could have increased, say, fries by a nickel, burgers by a dime and a few others to cover the business costs of the wage increase but he didn’t, he let his customers know this is what happened in an honest way.  He spelled it out.  He didn’t hide it.

We should congratulate him for telling the truth and more so, for waking us up to review all our bills and receipts.  Please look at yours and see what you find. Here is what I found:

Cell Phone Bill.    All of a sudden a .99 cent, new charge appeared on my cell bill.  They did indicate what it was for… sending me a paper bill.  I reached for my land-line and called them!  They were prepared and offered a trade to cover that fee.  That reminded me of my regular phone bill.  What were all the fees for?

Land-Line Phone Bill.    Down deep was an “access charge”.  In my naiveté, I had assumed (never do so) that it was something like a fee to access long distance service elsewhere.  Stupid me, it’s code for… we’re paying for free cell phones and free minutes for those on certain public assistance programs.  Those that have them, call them “Obama-phones”.  Phone companies, please tell the truth; don’t protect the politicians.  Worse yet that set me off about the Medicare changes, where no one will give you the straight scoop.

Medicare Insurance Changes and Premium Deceptions.       Most of these occurred for the 2014 calendar year, but please check if you are on Medicare for 2015 policy changes.  Especially watch for co-payments, new deductibles and co-insurance.

I was and still am very angry over what happened to my coverage and premiums for 2014.  My “premium” went up about $5-$6 a month to let’s say about $150.  This is with one of the major insurers in Minnesota which shall remain unnamed.  A few dollars increase is not a big deal but Katie, bar the door, as to what they did to the coverage.

I had been paying top dollar for their best plan to avoid co-pays, deductibles and co-insurances as much as practicable and really didn’t have any.  Now, all of a sudden, deductibles occur and co-insurance surfaces.  My premium only went up a few dollars but those of us in this top plan are now subject to $3,000 of out of pocket medical expenses not previously contracted for.

In essence, if an insured had a real bad medical year, they could find themselves paying not $150 per month but an equivalent $400 a month.  To me this is highly deceitful, deceptive and (if they were in the finance business) materially misrepresentative.

What we need is a straight, no-spin, completely honest answer from the insurance company if this is in any way one of the negative effects of the Affordable Care Act.  My experience with the company leads me to believe they are scared to death of the feds who regulate them and that you couldn’t get a bona fide answer out of the company.

When I called to get some explanations of the coverage, at first they gave me some fancy spin.  Later, it became a little better without the spin.  Their changes hurt the self-employed.  The Mom and Pops get the biz.

Conclusion.

Now, back to Mr. Beemer.  He did us all a favor laying it out as it is.  Regardless of where any of us stand on the issue, he brought public attention to the cost of governmental actions no matter what they are.  We all will pay in some form or another for them.  Let’s be honest and open.  There’s no free lunch at the Oasis or elsewhere.  Thank you, Mr. Beemer, we’ll check your menu out one of these days.

Bob Smith 3^rd

bob333smith3rd@gmail.com

GopherStatePolitics.com

Judge Judy is Humiliating Minnesota… Dunderhead Population at Risk.

For Immediate Release:                                                                      Contact: 

November 2014                                                                                  Bob Smith 3^rd

                                                                                                            480 St. Clair Ave.

                                                                                                            St. Paul, MN  55102

                                                                                                            (651) 222-6888

Special Feature from the Gopher State Politics Institute,   GopherStatePolitics.blogspot.com

Judge Judy is Humiliating Minnesota… Dunderhead Population at Risk.

Can government help sway the Tide?

Your Gopher State Politics Institute received a plea for assistance in halting the increasing use of Minnesota subjects on the Judge Judy small claims court, national TV show watched by millions.

This is a little bit of an unusual request, but we need to be open-minded and flexible to see if there is a proper role for government in this issue. At first blush, we could start by asking the Attorney General to write a cease and desist letter to Judy.

However, we first ought to examine and analyze this situation carefully.  Judge Judy has a recruiter here who seeks out misfortunate pairs to be on the show. To be fair, we can take out the calculator and divide the 250 shows by 50 states and say that a reasonable quota is five pairs per year. Not the three or four a week that is currently aired  on TV.

“Fargo” set the tone for using Minn-ah-soh-tah to push us off our above average ledge and Judge Judy refined it to new heights in securing Minnesota Dunderheads at an alarming and depleting pace.

So, if we think this through thoroughly, the problem really belongs in the lap of the Department of Natural Resources (DNR).  The recruiter is really a hunter seeking prey,  the Minnesota Dunderheads in pairs. At that rate the show is using them up, they could become an endangered species.  Hence, the need for Minnesota to legislate and regulate.

The recruiter / hunter should be licensed at a considerable fee, limit set at two pair per calendar quarter,  a five-figure per day removal fee established for each dunderhead pair taken out of the state and a DNR enforcement charge levied.

Presto! That is a creative use of political power to save the endangered species Minnesota Dunderhead from being over-harvested let alone protect Minnesota’s reputation as a State where all children and-by extension-adults are above average.

Problem solved. Take that, Judge Judy.

Visit us at:

Gopher State Politics Institute

http://GopherStatePolitics.blogspot.com

Robert L. “Bob” Smith III

bob333smith3rd@gmail.com

The Veterans Affairs Mess

Don’t throw the baby out with the bath water...

We at the Gopher State Politics Institute generally try to stay clear of federal matters. The U.S. Department of Veterans Affairs- the "VA" – health care issue centering on misleading dates of provider services has surfaced genuine anger among us. People are furious over this and it is not partisan. The VA must get its house in order. How?

Relieving the Secretary and Under Secretary for Health of their posts is not the way to go. They are the two who could best change the course quickly, if at all. Congress passing new laws will do little to right the course. The system needs to be managed on truth, not the political management style of making the system and higher ups look good.

Please understand that the overwhelming majority of VA employees are good persons dedicated to serving their veterans. The system has put them in a position where data fudging is almost a must. The scheduling issue is the poster child. The metrics model has to go and go now. How?

This is a very emotional issue. Cool heads need to prevail. This should be done in a dispassionate, rational, business-like adult problem-solving manner. Get rid of the political management style and replace it with a management responsible for detecting local problems and solving them, focusing on the veteran receiving quality care in a reasonably timely basis, to the extent that is possible without forcing speed.

The doctor who blew the whistle at Phoenix suggests an amnesty period where each facility can get it‘s house in order without fear of reprisal. Each facility needs to put out a true picture of where they are at with care, waiting lists, and other factors.

Management now knows where they’re at and their job should be to find, identify, and correct problems. The absolute truth must stand out and be addressed. Making one’s facility look great when it isn’t is a political management con. Leadership is in order and the VA needs only one instruction from the Administration and Congress.

Fix it! - Then stay completely out of the way.  Bob

The Shame of Minnesotans Having to Move to North Dakota

For Immediate Release                                                            For Further Information Contact

Letter to the Editor March 2014                                               Bob Smith 3^rd      651-222-6888

The Shame of Minnesotans Having to Move to North Dakota

For the few months I’ve been examining the upper Midwest state personal taxation policies and their possible effect on population movement.  My original article, The Great Minnesota Exodus Tax Acts of 2013 available on www.gopherstatepolitics.blogspot.com indicates that North Dakota has no estate tax and that their individual income tax using an identical data example for all states was 73% lower than the Minnesota tax.

The next logical step was to check the out-migration population movement from Minnesota to its neighboring states. This has already been mostly done by the Center of the American Experiment in an April 2013 publication Minnesotans on the Move to Lower Tax States (AmericanExperiment.com) covering 20 states.  I only had to go to the TaxFoundation.org website to find the IRS AGI (adjusted gross income) tax data on their migration calculator for Minnesota-Wisconsin for the same 2005-2010 period to match the Center’s study.

Carefully reviewing the data, I was stunned by what appeared. Minnesotans moving to North Dakota had the lowest average taxable income of the 21 states migrating populations. We Minnesotans pride ourselves that we’re above average. Yet, here we are at the bottom. What a shame.

Then I looked further and discovered that the Minnesotans whose average taxable income was three times that of those moving to North Dakota went to Florida. Whoa! What kind of income and wealth redistribution is this?

Add to this the complicating fact that nearly as many are coming back from North Dakota as were going. Is this a Minnesota idea of a migratory labor pool? What is wrong with the Minnesota economy that we do not provide decent paying jobs for good people who will move to work?  We as a state are blessed with the elements needed for an energetic, job-producing environment. Why is not business and industry growing jobs?

One word.  Incentives.  Businesses need to be able to compete, thrive and make a profit.  The business climate, the job climate is all about the political climate.  A legislature that looks at business as a piggy-bank is not a job-producing legislature.  Business needs to be treated fairly and our actions must demonstrate that we are genuinely wanting to become a pro-growth state.  Please let us create a state where we don’t pit one against another, where low earners can find better jobs and where those at the higher end don’t feel that they have little choice but to move out of the state.

Bob Smith 3^rd

St. Paul, Minnesota