Building a "Rio Grand Canal" along full border with Mexico is a trifecta!

A canal that's wide enough and deep enough for oil tanker, cargo ship, and naval vessel traffic will help solve 3 major issues: US border security, defense mobility-efficiency, and economic-job growth.



Only the Panama Canal prevents all ships from having to go down and around the South American continent, which is a much longer, and much more dangerous ocean route.

US border security can't get much stronger than a wide, deep waterway. That prevents both underground and overland illegal border crossings, and limits border crossings to bridges, airplane, and boats.



With increasing emphasis on Pacific Rim military security, rapid-response, multiple theater, special forces, and terrorism by the US national security community, the concern over sudden blockage of the Panama Canal grows. The national security value becomes as important, if not more important than border security.

    

Loss of access to the Panama Canal would strike a major blow to US commercial shipping as well as military mobility. Such a logistics nightmare scenario would through the U.S. into recession and shock the prices of many goods, given how much travels through the Panama Canal. Isn't that a border security issue too?



Now think about the positive side in economic-jobs issues how many jobs would be created by excavating and dredging a Rio Grand Canal -- both in the U.S. and in Mexico.

    

Imagine how many jobs would be created just by digging the canal. Imagine how many jobs would be created by serving the needs of all of the canal building employees.

Imagine how many jobs would be created by the build-up along the shores -- U.S. and Mexican.

   

Imagine how many people who would have tried to cross the U.S.-Mexican border would instead find jobs related to the new canal. Isn't that a major, and positive, effect on border security?

   

Imagine the economic growth and flexibility from a series of ports built along both U.S. and Mexican shores of a Rio Grand Canal. The land value of what are now mostly dessert acres would soar. Access to water, even if desalination were required for drinking and farming, would greatly help the persistent and growing water shortages in the entire Southwestern region of the U.S. and Northern region of Mexico and support economic growth in both countries.

Building a long canal to connect major bodies of water for economic development as well as national security is not a new idea. It's been done successfully in the past and even being done now.

In the 1800's the Erie Canal was built connected New York City harbor for the Atlantic Ocean with the St. Lawrence Seaway for the Great Lakes Mid-West ... as well as all of the towns that sprang up along the canal. Of course, in the 1800's, Canada was part of England, with whom we'd just fought 2 wars (Revolutionary War and War of 1812) and where the New York waterways and forts played major roles.

   

Even today,  China is building the Grand Canal to connect its inland cities and farms to the Pacific Oceans and coastal centers.

Yes, building the Rio Grand Canal would be very expensive. But the return on that investment would be immediate and much greater.

By Steve Reichenstein

Why does NSA outsource the security and privacy of our nation?

Yes, I'm concerned about the government violating our Constitution Bill of Rights. I never supported those parts of the Patriot Act which impinge on 4th amendment protection from unreasonable search and seizure. 

Better coordination and sharing of information between intelligence and law enforcement agencies makes sense, as do other elements. But our government should -- and must -- competently do its job without violating the 4th amendment. 

Remember the warning by Benjamin Franklin: "Any society that would trade a little liberty for a little security will deserve neither and lose both."

Deciding between privacy and security is a FALSE CHOICE.

I believe, as did our Founding Fathers in writing our Constitution and Bill of Rights, that government CAN fulfill its responsibilities to protect both our security AND privacy within the Constitution Bill of Rights, period. 

Government just needs to be increasingly more competent to do so -- to apply the new technologies, old technologies, and lessons learned with stricter action points.

Competence should be under the microscope. Also, outsourcing should be under the microscope. 

The Edward Snowden incident conveniently has put both of these issues front and center -- in the NSA as well as elsewhere in the government's critical services, such as all military, policing, prisons-judicial, NRC, and IRS.

How much have new technologies and analytics improved government competence in protecting BOTH security and privacy? How has outsourcing impacted capabilities and competence -- improved or detracted? 

Outsourcing our privacy and security concerns me enough to write this blog post at this time.

Outsourcing the privacy and security of We the People is the topic of this post and should concern every taxpayer.

I support the great work of the NSA, CIA, and other brave patriots defending our country. I'm not picking on the NSA or any other agency. I'm concerned about the contracting-outsourcing practice as it relates to our privacy and security.

The under-reported, under-discussed issue is that our government outsources our security ... and privacy ... to companies which then hire away government employees and return them to government jobs at much higher compensation plus profit for the outsourcing company. 

Why doesn't the NSA hire employees, especially to handle such sensitive information? Why didn't the NSA either transfer from CIA to NSA or just hire away Edward Snowden?

If cost of employment is what will attract (away from other prospective employers) the trained, talented, and experienced employees that government needs in order to fulfill its responsibilities, then we should improve the compensation packages. These are not areas of government where we should pinch pennies. We're paying that much ... and more in contractor profits ... now by outsourcing!

Clearly, as we now see, the use of much more expensive private sector employees does not increase NSA competence. Edward Snowden affair being a prime example ... and the one now known to the taxpayers. 

Paying more for private sector employees who left public employment just for the purpose of doing the same jobs for more money is tantamount to corruption or conspiracy to defraud our government. It's also an affront to our public employees doing the right thing. And, it's a blatant waste of taxpayers' dollars.

Further, if these private "middleman" companies are going to suck profits out of the taxpayers for arranging for public employees to go private for higher compensation, then these companies also should bear the burden, culpability, and liability. 

Outsourcing government employee jobs, often in order to pay government employees much more and, perhaps, just to leech from the taxpayers, is epidemic in the U.S. government (and probably at the state, county and local levels too). 

Congress should hold public hearings and elected officials should be held accountable on the campaign trail to justify or condemn it.

What do you think?

Steve Reichenstein

"Governor Christie, why are you spending an extra $12-million of our money on an extra general election day?"

Dear Governor Christie:

Spending $12-million on a special general election to fill Senator Lautenberg's seat when our regularly scheduled and budgeted general election day is only 3 weeks later betrays taxpayers trust.

I thank you for finding an extra $12-million bonanza of unnecessary taxpayers' money being collected ... but ...

But if you can find an extra $12-million for an unnecessary, extra election day to fill Senator Lautenberg's seat, then you should return the money to us, the taxpayers.

Governor Christie, here are a few ideas for returning the extra $12-million to taxpayers without the further expense of issuing and mailing us checks:

(1) Eliminate the $13.5-million Public Utilities Excise Tax

(2) Reduce the $191-million Realty Transfer Tax, which would save the average home purchaser approximately $300 (Aren't we trying to revive the housing market?)

(3) Help out businesses by reducing the $80-million Corporate Energy Tax

(4) Chip away at the $535-million Motor Fuels Tax.

I'm sure you can find other taxes to cut as well.

Governor Christie, if you believe that it's important that our $12-million bonanza be spent -- you know, to boost the economy -- then here are a few items that should be higher on your list than an extra, unnecessary general election:

(1) 200 police officers?

(2) 200 teachers?

(3) Help thousands of New Jersey victims of Hurricane Sandy?  (Hasn't Mary Pat been putting that bug in your ear?)

Governor Christie, why haven't you been speaking up for your decision? Help us out in understanding why it's so important to have an extra general election during election season. 

We've heard the press and politicians argue rather persuasively that you scheduled the Senator Lautenberg replacement election away from the general election day in order to avoid the much heavier voter turnout, especially by Democrats and Democratic-leaning Independents, that a federal election brings.

Frankly, it's been troublesome that you have NOT offered any good reason, nor any reason at all, for deciding to set the special general election to fill Senator Lautenberg's seat on a different day from the regular November general election when they're only 3 weeks apart! 

Perhaps, Governor Christie, you have not offered any reason because there is no reason in the taxpayers' interest. I'd hate to think that you'd waste $12-million of taxpayers' money so blatantly on political self-interest.

Please argue persuasively for your decision to bifurcate a special general election and regular general election that are only 3 weeks apart.

Otherwise, we the taxpayers will have to conclude that you did it for these political reasons.

On a personal note, Governor Christie, I've often disagreed with your policies, though not all, but I've always respected you. This election scheduling thing really hurts!

Respectfully,
Steve Reichenstein

Senator Coburn: Which Level of Government is Responsible for What?

Is Senator Tom Coburn right on "Budgetary Justice"?

Dr. Tom Coburn, Republican Senator from Oklahoma, consistent with his position prior to the Moore, Oklahoma tornado disaster, opposed federal disaster relief spending for Moore, Oklahoma because state and private money should do it as they have in the past. 

Since that initial message, Senator Coburn has stated willingness to support federal disaster aid spending, but only if there are offsetting cuts elsewhere in the federal budget.  

Senator Coburn bases his position, also consistent, on the importance of states being responsible for adverse weather events, like tornados, that occur in their state. Senator Coburn believes that states, like Oklahoma, will not take steps necessary to minimize damage from such disasters if they can count on the federal government paying for the results of their irresponsibility. 

I believe that Senator Coburn is raising the larger issue of "States' Responsibility" which seems to mirror the large issue of "States' Rights". You can't have states making the decisions then the federal government paying the bills. 

States' Responsibility, like States' Rights, forces the discussion ... and decisions ... on where does the state government end and the federal government begin. Or, what is our citizens' compact with each other at the state level and then at the federal level? The same could be asked of the municipal, district, and county levels as well.

For now, let's focus on situations of natural occurrences, like tornado, hurricane, typhoon, tsunami, lightening, landslide, earthquake, and volcano. With few exceptions, these are not attributable to any people, businesses, or governments. Hence, we traditionally refer to these as "Acts of God" or "Acts of Nature".

The corollary of these acts of nature would be what are the responsibilities, hence liabilities, of governments, businesses, and people based on what's known about acts of nature and human actions in response. 

For example, if a person, business, or government (Let's refer to these as "Entities".) builds a structure at the base of a volcano, especially an active volcano, should other entities at all be responsible for damage from the volcanic spewing? What about structures built on earthquake faults? 

Taking this to a more common situation we face, knowing that the Mississippi River, and other such major rivers, overflow during the Spring and rainy seasons, hence they flood at least annually, then should damage to structures built along the shores, especially those built within the areas on both sides of the rivers that regularly are flooded? Consider that the ancient Egyptians, knowing that the Nile floods, built farm fields along the shores in order to take advantage of the expected flooding.

Now consider building structures closely along ocean shores. Consider structures built in Tornado Alley.

I believe that damages to structures at the foot of volcanoes, on earthquake fault lines, closely along flood river and ocean coasts are primarily the responsibility of the structure owners. 

Of course, unusually harsh, relatively rare occurrences should become primarily the responsibility of the larger community. But I'm not sure what should be the boundaries of responsible community: Municipal, district, county, state, or federal.

I believe that Senator Coburn has a good point. The Oklahoma private and state communities should have primary responsibility for the Moore, Oklahoma tornado damage. 

That said I also believe that the federal government might have a responsibility here due to the unusually harsh and widespread damage. It would be understandable for the federal government to spend on damage restoration. But, that offsetting budget cuts come from federal spending already budgeted to Oklahoma governments, businesses, and residents. 

In that sense, paying federal taxes can be to pay known expenses and a hedge against unknown expenses -- an insurance. The reality of a state subject to frequent, expected natural disasters has a vested interest in ensuring a state and federal government capable of supporting response and restoration. You cannot whip together a FEMA, etc.

The state or locality also can build a disaster fund into which they add money weekly, monthly, or annually as the means of repaying federal no-interest loans for restoration.

We are facing more and more frequent and more frequently harsh major natural disasters. So we should have this conversation.

I call the larger issue "Budgetary Justice". I believe that states should not receive federal spending greater than that state's total federal tax payments.  Senator Coburn expressed this rather well on  CBS's "Face the Nation" Senator Coburn (R-Oklahoma):

" 'We've created kind of a predicate, that you don't have to be responsible for what goes on in your state,' he said on CBS' Face the Nation while discussing the success Oklahoma has had in using state and private funds after the tornadoes." ... 'It disproportionately hurts the more populous states the way we do it, the economic indicator, the economic damage indicator, the way it's calculated ... So a large state like New Jersey or New York is disadvantaged under the system that we have today.' "

Budgetary Justice means that states should not receive any more federal government spending -- any federal government spending, not just disaster relief -- than that state pays in federal taxes. Anything  else would be unfair siphoning from the economies of those states getting less than they pay in order to subsidize those states getting more than they pay. 

Individuals and businesses in my state, New Jersey, pays a lot more in federal taxes than we ever get back in federal government spending of that tax money.  

Federal taxes drain money out of New Jersey's economy -- money that rationally ought to be spent in New Jersey, given that much of the federal spending can be spent in any state and New Jersey has more of nearly everything except land. This is not like donating blood, this is siphoning the gas tank.

I agree that some spending is geography-specific by necessity, like naval bases, but most are not. For example, Bethesda and Annapolis, Maryland are natural homes to the U.S. Naval Academy and naval port. But the military could put other spending into New Jersey that currently are overspent unnecessarily in other states. 

Also note that the National Institutes of Health does not need to be, nor should it be, in Maryland and the Centers for Disease Control in Georgia.

New Jersey could, and should, have a lot more Department of Defense and Department of Health and Human Services than we have now ... like the National Institutes of Health and/or the Centers for Disease Control.

This means more to a state than the money itself directly spent.

The Department of Defense funds more new high-tech R&D than any other branch of government ... and more than several industries ... including sustainability, logistics, and even healthcare (that benefits the treatment of wounded and improved outcomes for both active and retired soldiers). DOD has a huge stake in medical breakthroughs! The DOD has huge stake in logistics!

The Department of Health and Human Services through the National Institutes of Health, Centers for Disease Control, and Medicare Secondary Payer Recovery Contractor is the next biggest funding agency of high-tech healthcare R&D; and it too has a huge stake in medical breakthroughs! 

So why aren't more Department of Defense and Department of Health and Human Services spending on tech R&D located in New Jersey, the medicine chest and logistics crossroads of the nation? 

Yes, a lot of federal spending goes outside the country to fund embassies, military, and such. But putting a lid on how much any one state can get of our federal tax dollars spent in the country -- not more than they pay into the tax pool -- would be "budgetary justice".

If states could not receive more federal spending than they put into the federal tax pool, then "donor states" like New Jersey could have much stronger economies and lower state taxes -- the stronger economies, less debt, and lower state taxes that we should have.

Why is New Jersey subsidizing other states? Senator Tom Coburn (R-Oklahoma) is right on Budget Justice.

By Steve Reichenstein

Rapes in US Military not a cultural issue but, rather, an insurgency by serial rapists

US Military process for addressing rape claims clearly favors the rapists. Therefore wouldn't it make sense that rapists searching for safe hunting grounds would find the US Military fertile?

Perhaps the US Military should approach the sexual assault ... rape ... epidemic in the same way as any purposeful infiltration by terrorists. Rapists target entering the US Military, then rising to a position in which soldiers report to them and, possibly, rising to a position in which they are responsible for addressing the rape problem.

Perhaps the US Military should form a Special Forces & JAG joint division focused on sexual assault terrorists and terrorism. Unit by unit they might investigate, secure, and hold. Overall, they might try to tie incidents of rape together to find serial rapists, as the FBI does.

Rape is not a "tolerance" issue, like integrating the US Military.

The bottom line is that this is a premeditated crime problem that, likely, is being perpetrated purposely by outside rapists targeting the US Military. So the US Military should approach it as such.

What do you think about rape in the US Military?

By Steve Reichenstein

What does 'small government' really mean and Why budget cuts don't lead to small government

It seems like every time we cut budgets, programs are cut or the services are cut. We don't get less government small government. 



It's like a small manufacturer cutting a product line or a store cutting it's hours. The size of government is not smaller in terms of the bureaucracy and materials does not change. The same bureaucracy delivers fewer services or lower level of service. 

Why? In large-scale operations the fixed set-up and foundation staffing costs are incurred early on and then not increased as you substantially increase production. The 'marginal cost' decreases, meaning the cost of producing one more item decreases because the fixed costs are not increased and are now spread across more produced items.  Conversely, decreasing services-benefits increases marginal costs.

The bureaucracy per unit delivery should be the key measure of small government.

The idea of government budget cuts universally appeals if it means delivering the same products and services at the same quality with less cost or more products and services at the same quality and cost, so that the changes are accomplished through delivery innovation. 



Small government means less bureaucracy per unit delivery, but that never seems to be what gets in budget cuts. We need more sculpting and less axing. 

Budget cuts that improve the cost-effectiveness of government services through innovation requires the commitment to long-term program management in an environment of transparency, flexibility, good pay & training, and mistakes. 

Yes, employees on the floor up through management making reasonable mistakes without fear drives a successful innovation environment speeding down the experience learning curve. That's been the successful model for industry for years. 

That's what we need but that's not what we get in budget cuts ... nor in budget cuts debates. 

We get platitudes, philosophies, and obfuscating details to support the platitudes ans philosophies. 

We get union-busting cloaked as smaller government. We get people receiving government benefits, working for government agencies, and living in states that receive more government spending than the state pays in taxes ... all complaining about big government. 

Small government is a nice bumper sticker but it means different things to different people and rarely gets publicly discussed in specifics nor leads to budget cuts achieved through innovative cost-efficient reductions. Cutting salaries and benefits is not innovative, and usually reduces innovation. 

Successful stores sell more stuff to more people with the same hours, staffing levels, and cost (i.e. same quality and service level). That's innovative management. That's profitable growth. 

Successful small manufacturers sell more product, lower their costs and, often, improve their products over time as they develop new markets and experience learning curves.

So successful small government therefore, in a business analogy, should provide more stuff & services over time with the same hours, staffing, and products. 

So why don't we think of small government as relatively few people delivering a lot of services? Why don't we focus on government programs experiencing learning curves?

We have not achieved this kind of small government nor have we achieved the high-quality government services through the private sector necessarily. 

When most, if not all, private contractors deliver government services at lower reimbursement, so far, all or most of them have simply cut the level of service by cutting hours, people, and wages. 

Do you remember the fad for privatizing highways? Those states which tried it found their toll rates soaring ... just charging more for the same services that were provided when the government ran it. What a formula for ... success? ... raise toll rates and cut employee compensation. Not. Heck, the government could have raised the tolls to get the same dollar benefit they got from privatizing those roads.



This year, the New Jersey Turnpike Authority privatized the toll collection services to a company that changed absolutely nothing except increasing NJ Turnpike toll rates and cutting the employee compensation by more than half in order to ensure themselves a significant profit margin. So half-or-more of the money that was being spent at high velocity by Turnpike employees in our local economies suddenly has been moved onto the profits of a company. Not good.

In sales we say that anyone can sell volume but not everyone can sell volume profitably. The same rings true for operations: Anyone can do less with less but not everyone can do more for the same. 

It has been the growth of spending beyond the growth in services and the growth of our national income. It has been the growth of bureaucratic jobs and, perhaps often as well, hiring & appointing patronage rather than performers. 

We need government. We might disagree which services and benefits we should offer together through government. But we do need government. And we need high-quality government benefits and high-level services delivery.



Nearly every big American technological advancement and private sector growth spike has involved government and, very often, involved government start-up development or government start-up funding. Think about the internet, the railroads, airplane advances, the Jeep (mother to SUV's), damns, health care, and space ... and all the benefits that these government investments have brought to our private lives.  

America should be about doing more and affording more through innovation, not doing less and affording less by cutting. Are we to become churn 'n burn or remain bigger 'n better?

Good small government should not be measured by the amount of benefits and services delivered but, rather, by the ability to continually offer more benefits and services at the same delivery costs or the ability to offer the same quality of benefits and level of services without raising prices or cutting compensation. 

Small government means better government.

Now, let's start a transparent national conversation about what benefits, services, and investments our government should handle --- municipal, county, state, and federal.

By Steven J. Reichenstein

Hurts Economy, Unfair to Employees: Why Pay Federal Income Tax on Social Security, Disability, Unemployment Insurance Benefits?

Social Security, Unemployment, and Disability Insurances' benefits should not be taxable as income ... period.



Yet:

(1) Social Security insurance benefits are taxable as regular income.

(2) Unemployment insurance benefits are taxable as regular income.

(3) Disability insurance benefits from a personally sponsored or employer sponsored plan are taxable on the portion of premiums paid by your employer. If your employer sponsored disability plan premiums are paid through an employer sponsored cafeteria-style benefits program then all of the premiums are considered paid by the employer.

Ordinary income is subject to Social Security payroll taxes throughout your life, at any age, even if you continue to work while collecting Social Security insurance benefits.

Yet,

(1) Income over $113,700 per year -- any kind of income -- is not subject to Social Security payroll tax. This is referred to as the Social Security Income Ceiling.

(2) Income through qualified capital gains (that which is net profits and direct dividends from equity you own for more than 1 year) is not subject to Social Security payroll tax.

(3) Federal Unemployment Insurance premiums are capped to 6.0% on the first $7,000 in annual income per employee (fully paid by employers only) and exempt from capital gains income; but if not capped then could be an estimated .38% which would save employers an estimated $154 per employee.

(3) Medicare payroll tax (of 2.9%) has no Income Ceiling. Additionally, starting in 2013, ordinary income above $200,000/$250,000 will pay an additional Medicare payroll tax of 0.9%.

(4) Medicare payroll tax was not applied to qualified Capital Gains income until now in 2013 when a so-called Medicare Surtax of 3.8% of the lesser of Adjusted Modified Gross Income above $200,000 (joint) or Net Investment Income.




Medicare tax on income has no income ceiling, so why does Social Security tax?

Capital Gains is no longer exempt from Medicare tax, so why is Social Security tax?

Substantially larger percentages of GNP has accrued to those earning more than the Social Security Income Ceiling and in the form of Capital Gains during the past 20-30 years, and this income is not subject to Social Security tax. Therefore this must be diminishing the Social Security Trust Fund and a leading cause of the currently debated squeeze.

And  your thoughts?

By Steven J. Reichenstein