Author: Tom Del Beccaro

Amidst polls showing flagging public support, the Obama Administration has decided to address the one poll, among all others, that will determine Obama’s political future: the unemployment rate. As Scott Rasmussen points out, the unemployment rate has a lot to say in deciding a President’s popularity rating and election results – which is probably why Obama announced he would hold a jobs summit with small business representatives among others.

Speeches and photo-ops, however, won’t change the fact that Obama’s policies are anti-capitalist and therefore anti-job and anti-recovery.

It’s important to note that the secret to capitalism is not all that secret. It’s right there in the name CAPITALism. Our system relies on:

Step 1. The ability of some to aggregate enough capital, i.e. save money, so that they can . . .

Step 2. Invest in productive enterprises, i.e. start or grow businesses which . . .

Step 3. Employ people – people who . . .

What a difference 200 days can make. When Obama took the oath of office at the end of January, the Democrats had a 7% lead in the Rasmussen generic congressional ballot – a simple poll that asks the question if the election were held today, would you prefer a Republican or a Democrat for Congress (no names – just a question of Party preference). As of September 6, 2009, that lead was symmetrically reversed to a 7% Republican lead – a historic 14% swing.

There are two main reasons for that reversal – style and substance.

On the substance side, there is no doubt that nationalized health care is sending a political shock wave through the electorate. Voters are deeply concerned about this issue because most voters are smart enough to realize (1) that Obama’s numbers don’t add up, (2) that huge government programs don’t work and reduce personal choices, and (3) the fact that it involves their own health care not just some other group of people. The health care debate comes on the heels of similar, deep seated concerns about Cap & Trade and the utter explosion of the Deficit. Those issues and others have given rise to a sense of buyer’s remorse on substance – and not just among those Republicans that strayed to vote for Obama – but among Independents who now favor Republicans 43% – 21% on that same Generic Ballot.

With each passing week, the political headlines make it clear that the luster is falling off the Democrat brand quickly. Whether its Obama’s falling polls, falling numbers for his health care initiative or growing disenchantment with the Pelosi/Reid leadership, the trend is unmistakable. To make matters worse for Democrats, that trend is likely to continue in the year to come.

The so-called stimulus package will not positively affect the economy. The reason is simple: the economy is still suffering from the 2nd largest tax burden in American history and the highest ever regulatory burden. Combined with a huge debt burden, staggering deficits and the threat of new taxes, it is no wonder that talk of a double dip recession has started to make the rounds among economists. All of that spells more than potential mid-term election trouble for the Democrats – something Congressional watcher Charlie Cook notes when he says the dynamic is “out of control” for Democrats and that there is a 50/50 chance they will lose more than 20 Congressional seats in 2010.

That dynamic, however, represents only an opportunity for success – not a guaranty of victory – for Republicans nationally and in California. Whether Republicans capitalize on that success is story yet to be told.

California’s ongoing budget problem brings with it an endless supply of commentary and proposed fixes. Not long ago, I wrote that California now has a revenue problem. Long before that, I wrote The New Conservative Paradigm that suggested that we need a true part-time legislature, 2 year budget cycles, a true budget cap, pension reform, sun setting of programs, zero based funding and cost/benefit analyses for all spending programs – to name just a few necessary reforms.

The tax issue, as readers of my columns well know, is of particular concern to me. Simply stated, the California tax burden is too high – which, when combined with the national tax burden, the 2nd highest in our history – ensures that the California economy will be slow for years to come.

In light of that, I took great interest in Dan Walters’ column in yesterday’s Sacramento Bee entitled: Are California taxes too high or too low? Walters cites a study which says that California had the 6th highest state tax burden in 2008. Of course, that means California is not the worst. But Walters’ column does not tell the whole story that we need to know. Here is why:

Just as they did so when they defeated the Reiner Initiative in 2005 and rejected Gray Davis’ tripling of the car tax, California voters once again rejected calls for more taxes in yesterday’s statewide special election.

The writing was on the wall from early on – Rasmussen Reports indicated that 73% of Californians opposed income tax increases and 69% opposed sales tax increases. In addition, 69% of respondents believed that major cuts in government are the way to balance the budget, while only 16% opposed them. Given the voter registration statistics in this state, those response rates constitute a solid consensus across party lines and a clear message that it is time for the politicians to offer a new direction for California.

Even in the face of adversity, with our legislators facing another multi-billion dollar deficit, there are some simple steps that can be taken to rebuild trust with the people of California.

Last weekend, the Executive Committee of the CA Republican Party voted overwhelmingly to oppose the Budget Package – Measures 1A through 1F. That vote mirrored the two to one opposition within the Party’s Initiative’s Committee and the opposition of the Party Delegates as well. In simple political terms, if politics is the art of the possible, and I think it is, it is simply not possible for the Republican rank and file to overlook the included tax increase or a government going out of control.

It is not possible in their minds for several reasons but one principle reason: for nearly all Republicans, being against tax increases is the final line in the sand. It is their core belief. Some, including the Governor, view that as being politically inflexible. I beg to differ.

It is said, philosophically, that there are no new thoughts, no unexplored concepts – just new ways of expressing what has been previously thought. That is the historical equivalent of saying that History repeats itself only in different detail.

You see, for nearly as long as there has been representative government, people have gravitated toward factions or parties. We know England once had Whigs and Tories and is now dominated by a Labour Party and a Conservative Party. For the pre-Renaissance Florentines, there were the Guelfs and the Ghibellines. In time, the Ghibellines were driven out and the city was dominated by the Guelfs who, unable to live with success, internally feuded and brought partisanship to a new height with the formation of White Guelfs and their sworn adversaries: the Black Guelfs – so stark can be the differences of partisanship.

The ongoing budget crisis certainly highlights the need for the long term reform of our Government. Among those reforms needed are (1) a true budget cap, (2) a two year budget cycle, (3) costs benefit analysis for programs, and (4) zero based funding. Given that the California budget has more than doubled since the early 90s, under Democrat and Republican Governors alike, and grew over 40% over the last 5 years, it should be rather obvious to all involved that institutional reform is required – not just different personnel.

The budget crisis, however, can’t wait for the long term solution. It is so critical that it requires a short term answer as well. Even so, in addressing that situation, the mantra should be: First – Do No Harm. As I wrote about in my article: The California Tax Deal & Why It Won’t Work".

Most politicians believe that by simply passing a law that raises tax rates – that more tax revenue flows automatically. That simply is not the case. If it was, then Churchill would have been wrong when he said: “A nation trying to tax itself into prosperity is like a man standing in a bucket and trying to pull himself up by the handles.”