Lois Lerner’s Sad Attempt to Renew Her Image

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After 16 months of silence, shamed IRS official Lois Lerner finally spoke out. Unfortunately, it was in a puff piece published in Politico, with strong quotes from Lerner assuring folks that “I didn’t do anything wrong” and that she’s doing just fine.

That’s great for her but what about the people affected by her biased, illegal actions? The Politico piece gives no indication that Lerner has any sympathy for the grief her department caused. In fact, she says “I am not sorry for anything I did.”

She plays the victim and denies any knowledge of how emails sent at the time Tea Party groups were allegedly targeted disappeared. It’s interesting she chose to speak out now — apparently to a very friendly reporter — after she pleaded the Fifth last year before the House Oversight Committee. In fact, the entire House voted to hold her in contempt of Court then.

In light of that, it’s ironic we’re hearing from Lerner first in a Politico puff piece. Why? Because U.S. Attorney for the District of Columbia Ronald C. Machen, Jr. is supposed to be getting Lerner in front of a federal grand jury for an interview. It’s actually mandatory for him to do so but it’s been 4 months since he received the citation and nothing has moved forward. Lerner could be put in prison for up to 12 months for her contempt, but it seems she’s not a priority for the Administration.

Why is she drawing attention to herself now? Image restoration. She doesn’t want to be the “bad guy” forever so it’s time to restore her reputation and this was the first step. Unfortunately for her, it may be an impossible feat. It’s unclear whether anyone buys her innocent routine but she may not care if she gets off scot-free.

She left the Department last year but is still receiving a $100k annual pension so apparently, she really is doing just fine.

Thank you, taxpayers, for that.

Here’s How I’m Voting August 5 (with printable grid of ballot measures) *Update*

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Original Post: Here’s How I’m Voting August 5 (with printable grid of ballot measures) *Update*.

You’d think being a political animal of sorts, election season would be my favorite time of year. It’s not. I hate elections. I hate the crappy, predictable radio ads (above all else). I know, they do it because it works. Well, not really, but I’m not going to give a free marketing statistics lesson here.…

The post Here’s How I’m Voting August 5 (with printable grid of ballot measures) *Update* appeared first on Hennessy's View.

Vote NO On Missouri August 5th Tax Increases!

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By Jan Farrar and Brian Bollmann:

On August 5th, you are being asked by the Missouri Legislature to increase your sales taxes.  Amendment 7, which is the MoDOT Sales tax that plans to bring in more than they need over the 10 year period to spend on projects they propose now. In the meantime, MoDOT has spent the stimulus money on the purchase of the billboard signs all across MO to “Inform you of road conditions and tell you that MoDOT Cares.”

Barrel Bob can be seen at construction sites across Missouri; signs advertise upcoming roadwork, and of course, “MoDOT Cares” is up in lights all across the state. Maybe MoDOT should get out of the advertising business with our tax dollars. The Missouri General Assembly claims that this tax will spur job growth. Is MoDOT in the job growth business? Our tax dollars already support the US Dept of Labor, the US Division of Employment Security. We need another redundant Department of Job Growth Department? Additionally, Amendment 7 will create a county and city slush fund for politicians to dole out to favored projects, and there’s no wording in the bill to prevent the construction of warehouses near the St. Louis Airport – the China Hub.

On one hand, Missouri legislators have passed a tax cut and tell us it will spur the economy and job growth. On the other hand, Missouri legislators have passed a tax increase (to the ballot) and tell us it will spur the economy and job growth. Which one is it? It can’t be both.

Please vote ‘NO’ on Amendment 7.

In Cape Girardeau County only, Proposition K is on the ballot:

On the August 5th ballot, voters of Cape Girardeau County will be asked to approve yet another tax to be added to our current list of taxes. You will have another chance to give the government more of you hard earned money.

Proposition K is a tax that gives control of up to $3,000,000 of your money to an UNELECTED board to dole out to selected people as they see fit – many of whom have made very bad choices of their own accord. We’re getting taxed to pay for the bad choices of other people. Oftentimes, such taxes are tied with Federal Government money and programs that will come with strings attached and remove the control of our tax money from the county.

This is a tax with NO oversight, and it is all about emotion. There are over a dozen programs in the area including social workers in nearly every Missouri school to refer these children to existing programs that can be tweaked if necessary to “help the children.”

Please vote ‘NO’ on Proposition K.

 

Barrel Bob… …a testament to Wants vs. Needs:

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Bob Corker Proposes Massive Hike in Gas Tax

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What better way to distinguish ourselves from Democrats than to propose a 12-cent increase in the dreaded federal gasoline tax at a time when gas prices are skyrocketing?

One of the reasons Republicans always lose policy fights is because their starting point in crafting solutions is born out of a Democrat premise.  One illustrative example of Republicans playing follow-the-leader with Democrats is on surface transportation policy.

In recent years, Democrats have bemoaned the “antiquated” and “crumbling” infrastructure as they promote more taxes and spending at a federal level to build roads and bridges – something everyone agrees is a vital function of government.

But which government or governments should be responsible for the lion’s share of surface transportation in the future?  Should we continue raising taxes and pumping hundreds of billions more into the failed federal sinkhole?  Or should we allow the 50 states to retain most of the authority over a function that is uniquely local in nature?

Evidently, Senator Bob Corker (R-TN) thinks we should double down on the latter.  He is proposing a 12-cent increase in the federal gas tax (it is currently 18.4 cents per gallon) in order to raise $164 billion over 10 years.  His plan, which is sponsored by Democrat Senator Chris Murphy, will undoubtedly lead to more waste.  And we all know that in 10 years from now they will be proposing yet another gas tax increase.

Adding insult to injury, Corker plans to offset the broad-based regressive tax hike with targeted tax breaks for corporations!

“One big GOP selling point was that the tax increase would not violate the Americans for Tax Reform pledge if it is paired with a provision making some popular tax breaks that are typically part of the tax extenders package permanent.

According to Corker, the list of tax breaks includes: research and development tax credit; Section 179 expensing, a tax break encouraging small businesses to by business equipment; the deduction of state and local sale taxes; the deduction of up to $250 in classroom expenses that teachers paid for out of their own pocket; a subsidy for mass transit and benefits given for land donated for conservation purposes.

“If you just took those, we do them each year, but you make them permanent; I don’t think there is anybody that disputes making those permanent, by the way, that alone would generate $189 billion in savings over the next 10 years,” Corker said. “So if the Finance Committee chose to link this … with that … you would not be violating the pledge.”

Wow – that is a winning message for a party that wants to appeal to the middle class.

Instead of agreeing to the Democrat premise, why don’t Republicans show the American people how the entire federal transportation system is broken and inefficient?  Why hit the American people with a massive tax increase when we can devolve transportation to the states?

Just another day in the minds of those who lead the Stupid Party.

What will the GOP do about the Latest Cap and Trade Scheme?

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It is has been noted in recent years that a good percentage of Americans do not pay income taxes.  However, we must remember that all Americans incur the cost of the hidden tax of regulations.  According to the Competitive Enterprise Institute (CEI), burdensome regulations drain $1.86 trillion from the private economy every year.  The tab is $15,000 per family, more than many families pay in federal income taxes.

The cost of the regulatory state is paid for in the form of higher costs for food, energy, transportation, and healthcare.  It is also actualized in the form of lower wages and less job opportunities.

As CEI notes, just last year the administration finalized another 3,659 regulations. It’s no surprise that five years into the most tepid economic recovery in recent years, the economy is actually contracting again.

Naturally, the Obama administration is planning to rub salt on the wounds of the American economy by implementing Cap and Trade style regulations that will shutter American manufacturing.  The EPA has released a 645-page plan forcing all power plants to reduce “greenhouse gas emissions” by 30 percent below 2005 levels by 2030.  Much like Obama’s administrative Dream Act, this devastating version of Cap and Trade never passed Congress.

So after creating a permanent part-time economy and driving up the cost of healthcare with Obamacare, this administration seeks to crush the average family with higher energy costs, which in turn, jack up the cost of most other vital goods and services.

In recent months, a slew of Republicans have introduced policy proposals attempting to appeal to middle class families.  There is no better way to advocate reducing government than by promising to reduce the regulatory state.  Along with repeal of Obamacare and opposing open borders (which hurts workers and taxpayers), the crushing burden of energy regulations must play prominent in any general election campaign.

On the surface, this is an issue for which all Republicans can unite and fight with a coherent message.  After all, the Chamber of Commerce is actually on the right side of the issue.  But there are two important observations that cannot be overlooked.

It’s easy for the Chamber and establishment Republicans to act outraged over the regulatory state when the EPA announces crushing regulations.  But what these people fail to see is that they are responsible for growing government and interjecting it into every aspect of the economy – to the point that they now feel that can control entire industries, such as energy, healthcare, and financial services.  People like Thad Cochran can’t have it both ways.  They can’t embrace the federal hand that subsidizes private enterprise and then complain about the hand that regulates them into submission. It is years’ worth of bipartisan work from the Chamber and pay-for-play Republicans to expand the role of government that has allowed the bureaucracies to grow large and brazen enough to regulate anything that moves.

The other point to consider is that although all establishment Republicans claim to be outraged over the latest Cap and Trade scheme, what are they going to do about it?  Remember, even if Republicans win control of the Senate, it will not change the balance of power.  They will not have control over the executive agencies, and Obama will be as truculent as ever in ruling by administrative fiat during the lame duck of his presidency.  Republicans already have control of the purse-string in the House – the last recourse to check against abuse of executive power – yet they sabotaged our only attempt to use it.

At some point, Republicans need to look beyond the next election to solving the constitutional crisis that is upon us.

Shift Power Back to the States

Stressed Schoolboy with Head in Hands

Anyone who reads the plain language of the Constitution and the writings of James Madison would come away with the unambiguous impression that the Founders vested the federal government with very few powers – powers that they felt could only be executed by a central government.  Much of what the federal government does in this post-constitutional era is not only superfluous but deleterious to economic growth and free market fairness.

However, there are other functions that are vital and important, albeit best left up to state and/or local governments to administer.  On this day 88 years ago, President Calvin Coolidge delivered a speech at the College of William and Mary echoing this very sentiment:

“We must also recognize that the national administration is not and cannot be adjusted to the needs of local government …

The States should not be induced by coercion or by favor to surrender the management of their own affairs.

The Federal Government ought to resist the tendency to be loaded up with duties which the States should perform.

It does not follow that because something ought to be done the National Government ought to do it.”

Two major issues that fit into this category are authority over transportation and education.  Both of those issues are in the news today, and conservatives should take note if they plan to effectively advance a conservative reform agenda in the coming years.

Transportation

With regards to transportation, once again the Senate is doubling down on the failed transportation policy of the federal sinkhole.  The Senate Environment and Public Works Committee approved a $265 billion highway bill, which dictates full control over transportation policy for all 50 states.  Each state has its own unique population, geography, topography, and transportation needs, yet it is all centrally planned in one 5-year bill from Washington.  Naturally, when you couple the inefficiencies with federal labor and environmental mandates, along with $43 billion spent on mass transit, the revenue collected from the federal gasoline tax can no longer cover the full cost.

Instead of taxing or borrowing our way out of the quicksand of inefficient federal policy, we should devolve most transportation authority to the states.  Senator Mike Lee (R-UT) and Rep. Tom Graves (R-GA) have companion bills (S. 1702/ HR 3264) to do just that.  Each state would levy its own tax to purvey highway projects and can easily prioritize the level of taxation and spending based upon its needs.  This is not even a left or right issue.  More liberal states would naturally levy a higher gas tax to fund infrastructure projects, while conservatives would cut other functions deemed unnecessary or harmful.  But that should not be decided by the federal government.

Education

Education is also an important function that should be controlled by those closest to the classroom, particularly local governments.  While our ultimate goal must be to remove the federal government from K-12 and higher education altogether, there are two promising bills from Senator Lee that would empower state and local governments with control over some aspects of education.

After a half century of producing no positive results, Senator Lee and Rep. Matt Salmon (R-AZ) want to devolve the $8.6 billion budget for the Head Start program to the states (S. 2119/HR 4481).  The program has done nothing but self-perpetuate and create jobs for special interests.  There is certainly nothing to lose by letting the states experiment with the money already appropriated.

Another bill (S.1904), sponsored by Senator Lee and Rep. Ron DeSantis (R-FL), would reform accreditation for institutions of higher education.

One of the major problems with the Department of Education is that is distorts the “education market” much like any other government intervention in the private economy.  The current higher education accreditation system is controlled by the federal government and creates a one-size-fits-all system that is heavily slanted towards conventional four-year college degrees.  This system does not work for everyone, but the accreditation process has forced many people into this framework, even if they would like to pursue other educational training.  In turn, it has contributed to the “education bubble,” in which federal bureaucrats work with leaders of higher education to over-utilize and over-emphasize the current system, thereby driving up the cost of an education – and by extension – student loan debt.

Senator Lee’s Higher Education Reform and Opportunity [HERO] Act would allow states to create their own system of accreditation, which could grant students the same benefits and status for pursuing alternative coursework, apprenticeships or vocational training.

Every Republican publicly decries the growth of the federal government, but many decline to divulge which functions they would eliminate other than rooting out waste and fraud.  Senator Lee’s bills on education and transportation provide conservatives with a solid opportunity to advocate limited federal government, federalism, and changing course from decades of failed policies by the federal government.

Email Your Senators to Oppose the EXPIRE Act

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This week, the Senate is expected to consider the Expiring Provisions Improvement, Reform, and Efficiency (EXPIRE) Act of 2014 (S. 2260) sponsored by Sen. Ron Wyden (D-OR)Heritage ActionScorecardSen. Ron Wyden4%Senate Democrat AverageSee Full Scorecard4%. The EXPIRE Act would temporarily extend more than 50 expiring tax provisions pertaining to individual and business taxpayers and the energy sector through 2015.

The Senate’s tax extenders — and indeed the entire process surrounding the extension of expiring tax provisions — is one of the most egregious examples of Washington using its powers to prop up well connected interests.

For example, the Senate package includes over a dozen targeted tax provisions aimed at energy production, most of which are geared toward so-called green energy.  According to the Heritage Foundation, Congress designed many of the provisions to “artificially tilt the energy market in the direction of certain renewable sources or reward certain taxpayers for behaving how the government would like them to.”  Others are “narrowly tailored so only certain industries can benefit, which is unfair.”

Reviving a repeatedly-extended tax policy os not a tax cut. The EXPIRE Act (S.2260) is bad policy and should be opposed. Use POPVOX to email your Senators and oppose the EXPIRE Act. Continue reading

The Simple Truth of Tax Policy

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One of the ephemeral trends in Washington policy circles these days is for members of Congress to craft their own draft plans for tax reforms in anticipation of a wholesale reform effort in the coming years.  It’s good that members are discussing reforming our antiquated and anti-growth tax code.  However, conservative members must not fall into the trap of adopting some anti-conservative premises when crafting tax plans.

Two of the liberal premises that some conservative proposals have bought into include: 1) the notion that tax reform must produce the same level of revenue as the status quo on a static score, and 2) we need to redistribute more wealth from the rich to working-class families.

With regards to the premise of keeping the same revenue baseline, some conservative policy minds often forget that the ultimate goal is to reduce the size of the federal government, not balance the budget as an end in itself.  At present, the Treasury is taking in a record level of revenue.   CNS news recently reported that the Treasury had raked in a record $1,428,710,000,000 in total taxes (adjusted for inflation) so far this fiscal year.  The CBO projects revenues to rise to over $3 trillion this year and grow steadily over the next ten years.  This is not good news.

We don’t need more money taken from the private sector to feed the rapacious beast in an effort to create more job-killing, price-hiking bureaucracy.  Any tax proposal should not seek to maintain this level of revenue on a static score, but decrease it.

As for the progressivity of the tax code, there is a disturbing trend even from some conservative lawmakers to propose tax plans that will result in higher effective tax rates for the wealthy while growing refundable tax credits at the lower end of the income ladder.  It’s understandable that Republicans want to show empathy with working class families and join in piling on the evil rich, but adopting liberal premises about our tax and entitlement structure will not solve the problem.

Many of the GOP plans call for dramatically curtailing or eliminating tax deductions for upper-income individuals.  Obviously, all conservatives share the goal (short of repealing the 16th Amendment altogether) of pursuing a more flat tax code with lower rates and elimination of market-distorting, social engineering tax preferences.  However, under the current system, especially after the fiscal cliff and Obamacare tax hikes, upper-income earners are subject to a marginal tax rate of over 40%.  Eliminating deductions without a commensurate reduction in marginal rates will result in linear increase in the effective tax rate of those who are already paying most of the income taxes in the country.

Let’s be clear: the tax code is already the most progressive in the world; it certainly doesn’t need to be made more redistributive.  The Joint Committee on Taxation is out with its annual projection of how the federal tax code will affect different levels of income earners in 2014, and it appears that the tax code is more progressive than ever.  If you use the graph that breaks down the distribution of income and payroll taxes by income level, you will find startling results:

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  • Those earning [individuals and joint filers] over $500,000 annually, which roughly corresponds with the much-maligned “one percenters,” earned 16.7 % of the income, yet paid a whopping 45.2% of all federal income taxes.  Even when factoring in all taxes, including the more regressive payroll tax, the top 1% of income earners were still responsible for 26.5% of the tax pie.
  • Those earning over $200,000, which roughly corresponds to the top 5% of filers, earned 32.3% of total income, but paid a whopping 70% of all income taxes.  When all taxes are factored in, they were still responsible for 46.7% of the pie, well over their share of the national income.  If you expand the income threshold to include all those earning more than $100,000, accounting for roughly the top 21% of tax units, you will find that they pay 95.2% of all income taxes and 75.7% of all taxes, even though they only earned 60% of the income.
  • Those earning under $75,000 (again, individual and/or joint), which account for the bottom 69%, actually accrued a -2% income tax liability (all of that coming from those earning less than $50,000).  They pay 14.5% of all taxes, even though they earn 28.7% of the income pie.

Taken as a whole, anyone who believes that the rich don’t pay their fair share are not living on planet earth.  Yet, many Republicans, in an effort to push tax cuts, albeit not for the rich, tend to propose changes to the tax code that actually make the system even more progressive.  The dirty little secret is that the rich already pay all of the income taxes.  These numbers are all final tax liabilities working off of effective tax rates, so they include all of the deductions and so-called loopholes.  And yet, they still pay almost all of the income taxes, while the lower-middle income earners pay almost no income taxes, and in many cases, enjoy a negative tax liability.

Hence, it is impossible to cut taxes other than for those who already pay them.  But many Republicans who want to reduce the burden on working class families, and do so in a way that will be revenue neutral, attempt to raise taxes on those who already pay the tab.  It’s fundamentally unfair and anti-growth.

Conservatives who want to encourage pro-growth policies that are consistent with our constitutional values of pursuit of happiness should instead look at the payroll tax for areas to promote upward mobility with working class families.  The payroll tax burden is shouldered by all workers and would provide conservatives with a great opportunity to cut taxes for all income levels.  The only casualty of such a plan would be our record high revenue that purveys the federal leviathan.  And that is a good thing.

Will Paul Ryan Fight for his Budget?

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Congressman Paul Ryan (R-WI) released his budget proposal for FY 2015 yesterday, and as expected, it is quite similar to the budget blueprints from previous years.  Let me first say that this budget would be superior to the status quo a million times over.  Medicaid and Food Stamps would be block granted to the states and Medicare would be subject to at least some optional free market reforms at the end of the budget frame.  Fannie Mae and Freddie Mac would be eliminated.  And most importantly, it defunds the Obamacare programs.

If Republicans would only fight for this budget during the debt ceiling fisticuffs, many conservatives would be more than satisfied.

But that is the point.  Given the fact that Republican have no intention to fight for even some major components of this budget when the deadline looms in September, why put out a half-baked proposal?  If this is just designed to be a messaging document that is tossed in the trash at the end of the fiscal year, why not place our ideal proposal on paper?

Ultimately, Ryan accepts the entire fiscal cliff ($618 billion) and Obamacare tax increases (roughly $1 trillion), working off the [optimistic] CBO 10-year revenue projections of $40.6 trillion.  Yet, even with the optimistic revenue projections and tax increases, the budget still runs deficits because not enough government programs are phased out or reformed, especially in the Department of Education and some of the other bloated bureaucracies.

As you can see, this year’s budget proposal is essentially the same as the FY 2014 document.  It’s just that entitlement spending will grow every year, engendering a $1.2 trillion increase in this year’s budget.  Even in the near term, this budget actually spends more, increasing spending in 2015 to $3.664 trillion ($166 billion more than what as projected in last year’s budget).

FY 2015

Outlays $42,636

Revenue $40,630

FY 2014

Outlays: $41.466 trillion

Revenues: $40.241 trillion

Hence, although the budget comes close to balancing in 10 years from now, much of that is achieved by accepting the current tax baseline.  Republicans should be able to show how the budget balances within a conservative framework of the tax code.  Granted that this budget would easily balance if we implement Medicare premium support before 2014, but that is the point.  If we plan to leave traditional fee-for-service Medicare in place and make premium support optional, why not begin the free market option earlier?

Moreover, there is a difference between balancing a budget and limiting government.  Balancing a budget is all about accounting.  You can coalesce enough small cuts across many programs and come up with a big number, without ever eliminating many of the 2228 federal government assistance programs.  I’m not sure how many of them would be abolished under this budget, although as mentioned earlier, solid reforms are imposed on Medicaid and Food Stamps.

Even as it relates to cutting raw dollars and cents, spending would increase, on average, 3.5 percent a year until 2024.  In other words, the federal government will still grow faster than the private economy.

Overall, this would be a great start if Republicans planned to fight for this document throughout the appropriations season.  They should announce upfront that they have no plans to pass a CR or omnibus bill this year and force Democrats to go to conference on each of the 12 appropriations bills through regular order.  That way, we can fight Obamacare in the HHS bill without fear of the Democrats holding the rest of government hostage.  Yet, that demand has not been made.  And sadly, we know from past experience that Ryan will be the first one to ditch his own budget when the going gets tough in September.

One other important point: if Ryan gets his way on amnesty, all of the supposed savings from welfare reform will be rendered null and void.

Cross-posted at RedState.com

Amtrak: Constantly Running Deficits but Considering Giving Free Rides to Writers

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So fun, so free!  Amtrak is currently considering offering a writers’ residency program for writers seeking inspiration-inducing-solitude by traveling through the countryside on an Amtrak train.   Providing a “unique environment for creative thought,” the program will be free to boot.  Exciting, right?  The folks at the Huffington Post think so:

Thanks to novelist Alexander Chee — who recently expressed his wish to see Amtrak begin a writer’s residency — the railroad service is about to offer exactly that, thus exciting writers everywhere.

The nascent program hasn’t been fleshed out completely, but officials at Amtrak appear willing (if not just as excited as we are) to see through the residency’s success.

Hate to burst the bubbles of writers and HuffPo alike, but let’s think about this potential program in realistic economic terms.  (We’re not operating in the parallel universe of a fiction novel where the laws of economics don’t apply, though President Obama seems to think we are, from the looks of his recent proposal for the next federal highway bill.)

Amtrak is not a privately-run company that can more or less do what it pleases with its money.  If it were, Amtrak activities would not directly affect federal taxpayers, and this blog post wouldn’t exist.

Though Amtrak’s financial situation has seen improvements in recent years, in fiscal year (FY) 2013, taxpayers funded Amtrak’s federal operating and capital (equipment) subsidies at over $1.4 billion. For FY 2014, federal subsidies total $1.39 billion—with $340 million in operating subsidies and the remaining $1.05 billion in capital subsidies.

Amtrak’s own Budget Request Justification for FY 2014 demonstrates the company has had operational deficits every year since 1975.  Until they’re operating as a private company without federal subsidies, it’s not the right time to start providing “free” services to anyone. They’re certainly not ”free” to the American taxpayer.  The Heritage Foundation’s Emily Goff explains:

While not much money would be spent on this “writers’ residency” program, it sends the wrong message to taxpayers: we’re going to pick winners and losers with your money by handing out freebies to a few lucky people. That sounds more like the lottery than a passenger rail service. Instead, Amtrak should be resolutely focused on reigning in its operating costs even further, to eliminate the federal subsidies it receives for operations—operations that include rides for writers. That is something for which taxpayers could cheer.

Then again, an idea this outlandish might be expected from a company that’s lost millions serving free wine and steak—a freebie that, fortunately for taxpayers, has stopped.

Julia Quinn, social media director for Amtrak, said there’s been “overwhelming demand” for this program to become a regular Amtrak operation.  But with April 15 just around the corner, it’s unlikely American taxpayers will be “all aboard!” with the idea.