Curmudgeon's Corner

Tipping Points...

Posted by Al Campbell on June 5, 2009

Economy, Healthcare, Political, Quality of Life, Taxes

Most all of us recognize, after the fact, when a "tipping point" has been passed.  The tipping point might be of a personal nature or it might be of a business nature.  For example, if we lose a job, we might look back and tell ourselves what it was that caused that final decision.  Or, we might look back on a business decision and see that it was the final piece that either made or broke a deal. 

The tipping point can also be of a political nature.  We are in the midst of so much political debate and change of such a significant measure that it is quite difficult to see when we're approaching a tipping point.

For example, Wisconsin's legislature is now sitting on a powder keg in the form of the new budget.  I suspect its passage in its current form will prove to have been the tipping point that took our Wisconsin economy down the tubes.  It contains all the wrong things from an economic perspective, and all the right things from a liberal activist approach.  Those two arenas simply don't work together.  If we give everything to everybody that we think is needed, we defeat the economy's ability to pay the price. 

Cases in point include North Dakota that has a relatively lower tax structure than Wisconsin and is seeing a very solid economic growth rate in spite of the rest of the economy.  Another is the remark by Steve Ballmer, head of Microsoft, that he will move employment "off shore" if the federal government goes forward with all the taxes and health care costs that it is contemplating today.  He says that he simply will not be able to produce the profit that Microsoft's stockholders expect if he doesn't take such action.  Texas is in the midst of a several years long economic boom and that is traced directly to lower taxes on business.

It is way too easy for Democrat politicians to damn businesses, but they need to wake up and recognize they've come to the tipping point both in Washington, D.C. and in Madison, WI.

The moves currently on their respective 'action lists' will prove to have been the tipping point that plunges us into a very deep recession for some long years to come.

There is an almost irresistible need to over-reach when one or the other party gains absolute control.  We have that in both Madison and Washington.  And, as much as that hurts whichever party is the victim of that driven need, it is us citizens who are always the real victims.  We lose jobs and homes and dreams.

We simply can't support all the spending proposals that have been queued up, and that remain to be unfurled, in our two capitols.  There isn't enough elasticity in either the state or national economy to support this largess...even if it is a good idea...which is very much debatable.

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The Curmudgeon Blog today is titled "Employer Tax 'Break' On Health Care Going?"