Kentucky Club for Growth
fighting and winning for economic freedom

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February 24, 2007

HB 305: Wage controls

What share of House Republicans voted to impose a higher wage floor on small businesses in Kentucky? 73%.

Just a quarter of House Republicans voted to stop additional wage controls in Kentucky. Here are the lawmakers who stood up for the free market this week:

Any questions?

February 22, 2007


The Kentucky Club for Growth announces its support for the following bills now under consideration in the Kentucky General Assembly:
HB 224, HB 228, HB 249, HB 295, HB 317, SB 108
The Kentucky Club for Growth announces its opposition to the following bills under consideration in the Kentucky General Assembly:
HB 184 (withdrawn), HB 222, HB 223, HB 247, HB 305, HB 324, HB 267, HB 292, HB 310, HB 313, HB 318, HB 411, HB 418, SB 5, SB 12
More to come ...

February 17, 2007

Herald-Leader on board against HB 184


You should log onto your e-mail, pick up the phone, collar your representative in person, or even take pen in hand to protest this bill. It is a license for government by the few, in secret.

HB 184 is arcane, legalistic and procedural. But what it essentially says is that when a few powerful House and Senate members get together to hammer out the final details of the budget that, in addition to fiddling with appropriations, they can change anything that's been passed that session.

It goes even farther, because they've already been doing that. It says those changes will be permanent, not just for the period the budget is in effect, as is currently the case.

If this bill passes, most legislators, and all ordinary citizens, will be locked out of the process of making the laws that govern us.

What's done in the open, through committee hearings, debate and compromise, could be undone in secret. History and human nature tell us that that would lead to government for the privileged few with access and power.

Kentucky's history is unfortunately littered with examples that prove the point. The fallout is everywhere around us: poverty, ill health, limited economic opportunity, lagging educational achievement and a damaged environment. The bill's champions, most notably its sponsor, Rep. Harry Moberly, D-Richmond, say it's really a simple matter, a way of setting things straight because courts can't seem to understand this is the way laws are supposed to be made.

The Kentucky Constitution says revenue bills are not supposed to deal with anything but revenue (Sec. 47) and that a bill should deal with only the one subject described in the title (Sec. 51).

Congrats! Good job! 


Billy Harper on Newsmakers

Ernie Fletcher is there now, but Billy Harper appeared on Kentucky Newsmakers this morning. It should pop up here soon.

February 15, 2007

Stan Lee

Stan Lee, the leading fiscal conservative in the General Assembly, is running for Attorney General and has his website up and running. Federal and State law will only allow us to tell you about Stan's record, so let's give it a try!

Stan Lee is clearly the strongest friend a taxpayer can have in Frankfort. His record of leadership in Frankfort speaks volumes about his true fiscal conservative values. A defender of the Constitution, Stan Lee has never put politics in front of principle. Call Stan Lee today and thank him for his service and leadership at 502-564-5314.

February 10, 2007

Kudos to Mitch!

It's fair to say that public financing of political campaigns is pork-barrel spending. After all, how much of your money should go to give politicians the luxury of not having to go out and ask for support?

Mitch McConnell, a longtime foe of McCain-style campaign finance reform, now wants to take free elections a step further and eliminate any federal funding of political campaigns.

Good job, Mitch!

Northup on Kentucky Newsmakers

You can watch it at this page, but Anne Northup has been touting her conservative credentials. We'll let you decide! Try this out:

  • Anne Northup was 0 for 19 on the Jeff Flake anti-pork amendments in the U.S. House, tying her with Ben Chandler and Hal Rogers, an up-and-coming porker and Kentucky's Prince of Pork, respectively.

  • Northup funneled millions of dollars to a charity she herself established. According to Citizens Against Government Waste:
    According to USA Today, Northup not only named herself as a director of the organization, but the chairman of the board is a campaign donor. While some of these grants may help people, they also act as a clever reminder to the people of Louisville of Northup's philanthropy, phony as it may be.
  • Does it strike anyone as odd that Anne Northup, someone who prides herself on having sent your federal tax dollars to Louisville churches, now claims to be a fiscal conservative?
More to come ...

Fletcher was on Newsmakers today. We'll see if he did any better.

Who's the tax cutter?

The Wall Street Journal raises doubts about various GOP presidential candidates:

Our own doubts relate to his economic instincts. He's a bulwark against spending earmarks, no question. But Mr. McCain turned against the Reagan tax-cut agenda in 2000, and he voted against the Bush tax cuts of 2003. Now that those tax cuts have proven to be a spectacular success, the Senator says he wants them made permanent. But his justification is the political one that he has "never voted for a tax increase," not that he now understands his opposition was wrong on the merits. With 2008 likely to be a tax watershed, the GOP needs a candidate who can articulate a pro-growth agenda. Maybe his estimable economic advisers, former Senator Phil Gramm and former FTC Chairman Tim Muris, can steer him right.
It's pretty sad when there's no Steve Forbes-style conservative running for President on the GOP side. Worse still, many of the GOP candidates - Mitt Romney chief among them - have deep reservations about allowing a free market in health care.

February 7, 2007

Kill the AMC!

The Gross Receipts Tax - often referred to as the Alternative Minimum Calculation, or "AMC" for short - sounds fairly non-threatening at first blush, but in reality, every business owner, manager, employee and job-seeker is affected by this anti-growth tax on free-enterprise.

In 2005, the Kentucky General Assembly passed Governor Fletcher's "Tax Modernization" proposal, which, among other things, closed loopholes in Kentucky's Tax Code that had previously permitted pass-through entities such as Limited Liability Corporations and S corporations to largely escape corporate income taxes.

In addition, the plan instituted the ostensible Alternative Minimum Calculation, which required all businesses in Kentucky to calculate their tax bill three ways, and then pay the highest amount, with a minimum amount due of $175 The three methods are as follows: (1) 7 percent of all net income, (2) 9.5 cents per every $100 of gross revenue, or (3) 75 cents per every $100 in gross profits.

Among those saddled with this new tax are single-owner businesses and small partnerships, whose income had previously been collected at the individual level. Also affected are high-volume, low-margin businesses such as grocery stores and service stations, since the new calculation is based in part on total revenue, which does not accurately reflect their actual profits.

Subsequently, due to significant public outcry, under a revised plan agreed to in a Special Session of the General Assembly called by Governor Fletcher in 2006, businesses with gross profits of less than $3 million became exempt from the alternative minimum calculation. Nonetheless, opponents of the new Gross Receipts Tax - such as the Kentucky Club for Growth, a non-partisan economic watchdog group - contend that the token exemption for Kentucky's smallest businesses merely serves to accentuate the punitive nature of the AMC, and are advocating for its immediate repeal.

"The new Gross Receipts AMC hurts the economy by hiding additional taxes and fees into the many products and services our economy relies on everyday," says Brian Richmond, Executive Director of the Kentucky Club for Growth. "This is not simply a tax on the profit a business earns, but on every transaction it makes with vendors and consumers. This means that the tax is in fact compounded and passed along to every consumer or company involved in billions of transactions made everyday."

Take for example fictional company ABC - perhaps an airline carrier or manufacturing firm - which actually suffered a significant financial loss in 2006, despite taking in gross receipts of $100 million. Even though the company has over 2800 employees, and is in the midst of cutting salaries and staff, they still will be forced to pay taxes on the $100 million in gross receipts. Does this seem like a winning economic proposal? Who do you think loses?

Alternatively, let's use the example of a small family-owned business we'll call the XYZ Company, which operates a small chain of grocery stores or service stations, In 2006 their gross receipts were $10 million, while there net income was $500,000. Under Kentucky's new gross receipts taxing paradox, they will be required to pay taxes not on their net income, but on their gross revenue. Guess who pays more for groceries, fuel and repairs?

The notion that the Gross Receipts Tax affects large businesses only is totally false, even if the Commonwealth continues to raise the ceiling on exempted revenues. Consumers and small business owners may not notice the additional price at the checkout immediately, but you can be sure that it will sorely impact their pocketbook. Worse than affecting a corporate bottom line, the gross receipts tax profoundly impacts the average citizen, employee and job-seeker through hidden fees and reduced capital investment. Perhaps that is why most state governments eliminated this tax in recent decades. What happened? The Kentucky Club for Growth wants to know.

February 4, 2007

Aim high, kids!

In pushing for a minimum wage hike, Rep. J.R. Gray preps the General Assembly for a big minimum wage hike (and, in doing so, takes a meat cleaver to the Queen's English):

"We need to proceed forward with full speed," said Rep. J.R. Gray, D-Benton. Gray is chairman of the Labor and Industry Committee, which has jurisdiction over minimum wage. "Congress has sat on their duff since 1997 and did nothing to help these lower-paid people."
Get ready for the hike to come soon if U.S. House Speaker Nancy Pelosi can't get the job done in Washington.

February 3, 2007

Memo to Anne Northup

If you have just released a poll showing you are allegedly even with Governor Fletcher, it is probably not wise to say "pollsters and consultants don't have any incentive to tell the truth."
Coming soon: What former U.S. Rep. from Kentucky is a HUGE fan of pork-barrel spending, and says so on the record?

02/24/07 : HB 305: Wage controls

02/22/07 : KEY VOTE ALERT

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The KY Club for Growth seeks principled candidates who are committed to the following:

* Free market principles
* Lowering taxes
* Reducing spending
* Decreasing the size of government
* Judicial reform
* Protecting property rights
* Expanding school choice
* Reducing needless regulation

We will hold endorsed candidates accountable for these principles by monitoring each candidate on a vote-by-vote basis. As a Club member, you will receive candidate monitoring updates and scorecards on a regular basis. Join us today.