Saturday, June 23, 2007

Let's Look at the Peters and Pauls

I never expected to write about the candidates for the presidential race. It's not exactly local news, but after hearing the Democratic candidates' debate on CNN two weeks ago, I've been annoyed by how out of touch they are with reality.

Listening to the Democratic presidential candidates, you would think the U.S. economy is in the tank, people are dying in the streets from lack of health care, we have no middle class — just haves and have-nots — and only the government can fix the inequities of society.

Of course, the only way the Democrats know how to fix these inequities is to take from Peter and give to Paul. Peter won't like it, but you will always get Paul's vote, and there are a lot more Pauls than Peters. They always try to put Peter in the worst light by making him or her a sleazy executive from some Enron-type company that gets rich stealing money from poor widows.

The reality is that the Peters (or Patricias) are the most productive citizens. I am sure there are some Peters who are lazy rich kids living off of grandpa's hard work, but for the most part, the ones I know are not. The vast majority are self-made, very hardworking and honest to a fault. They work a lot more hours than most Pauls, and they are very disciplined. They understand the concept of delayed gratification and are willing to wait for things if it will help them in the long run.

At the risk of sounding politically incorrect, let's talk about Paul (or Paula). Before I go any further, let's take off the table the Pauls who have real physical or mental disabilities and children who through no fault of their own are being raised by Paul. In that case, Peter has been more then generous in giving to Paul. In fact, Americans give the disadvantaged around the world more money per capita than any other country on earth — and, by the way, "red" county Peters give more than "blue" county Peters.

Statistically speaking, Paul has children earlier in life than Peter and is more likely to raise those children alone without a spouse. In fact, the vast majority of poverty in this country plagues children born without a father in the home. But just like Europe before us, the left wants to make fathers unnecessary and have the government fill that role. I just don't know how the government can discipline a 13-year-old boy without a father around. Sure it's been done, but I wouldn't want those odds in Vegas. The only way government knows how to discipline is with juvenile hall — not exactly the most compassionate way to raise a child.

If the left took all the money they wanted from Peter, they could never solve Paul's problems. Paul can only change his situation by becoming Peter.

What we should be teaching in this country is how to be a Peter and not a Paul, how to get ahead in life by working hard and being honest.

I never heard any of the candidates talk about relying on self-sufficiency or self-discipline to get ahead, only how the government could solve their plight.

These ideas may not sound compassionate. But whether people like it or not, the truth is the truth no matter how you spin it.

The ideas may sound old-fashioned, but they come from a time when we had more Peters than Pauls.

Saturday, June 16, 2007

The Bill That Wouldn't Die

Last week I thought we were safe. The U.S. Senate had gone home and pulled the Comprehensive Immigration Reform Act of 2007 off the senate floor to go where all dead bills go. Then on Thursday, like Frankenstein, Senate Bill 1348 came back to life.

A lot of people have very different opinions of this immigration bill. They should, since it has 281 sections. The problem for most people is not necessarily the wording in the bill, though some sections would make you wonder if this bill was written by senators from the U.S. One opinion that does seems universal is that when it really comes down to it, no one thinks the Feds can implement it. No matter how much tough language the Senate puts in about strengthening the border with beefed-up border patrols or electronic surveillance equipment, no one believes it. No matter how much it talks about verifications and doing background checks, no one believes it. In fact, most average Americans have evidence to the contrary that the federal government cannot handle any program of this size and complexity. Government agencies make the cable companies look good.

Example: This week, the government admitted it was unable to process passports to legal U.S. citizens even though it had two years to prepare for the increased need based on the 2005 Western Hemisphere Travel Initiative, which required U.S. passports for travel between the U.S. and Mexico, Canada or the Caribbean. By Friday, the State Department was so overwhelmed with passport applications that the U.S. House Rules Committee voted to prohibit the implementation of the travel initiative. This was just for processing passports to existing U.S. citizens.

Let's look at what the Comprehensive Immigration Reform Act of 2007 asks to implement. First, this bill would require that Homeland Security process an estimated 12 million immigrants who can "establish that the alien was in this country for 5 years prior to April 5th 2006 and was not legally present in the United States on April 5th 2006 or their visa expired and therefore were not legally in this country … for purposes of this subparagraph, an alien who has violated any conditions of his or her visa shall be considered not to be legally present in the United States." The only way you can stay in this country is to admit you were here illegally. The immigrant would have to produce "conclusive documents" showing employment, pay stubs, etc., and if they can't, then they can offer — and this is a tough one — "sworn affidavits from nonrelatives who have direct knowledge of the alien's work." This will help those people out of work making fake green cards. Now they can make "sworn affidavits."

Second, the department has to set up an Automated Biometric Fingerprint Identification System (IDENT) and have all the immigrants fingerprinted. I am sure all the illegal immigrants who have committed crimes will be first in line.

After that, the IRS has to provide proof that the immigrant has either paid their taxes or doesn't owe any. This from a department that can't even answer its phones. With a backlog of 12 million, I am sure they will do a full audit. My guess is they will just require another "sworn affidavit" stating that the immigrant did not make enough money to pay taxes.

Let's be honest — nobody believes that this bill would ever really be enforced. Business leaders want cheap labor; taxpayers pick up the cost of education, health care and uninsured drivers; and liberal politicians — well, they just want votes. In fact, if we gave liberals everything they wanted except "the path to citizenship," then this bill would be dead faster that you can say "amnesty."

I agree that 12 million illegal immigrants in this country is a big problem and that the Feds need to do something. But to simply change the law and, presto, all 12 million become legal is not the way to solve a problem. This problem didn't happen overnight, and it won't be fixed overnight. In fact, the status quo is better than this bill.

Saturday, June 9, 2007

Great Park is a Misnomer

It has been six weeks since I started this column. My goal for each article is to look at issues that affect us all and try to drill down to what is really going on below the surface. People who have a vested interest in how a particular situation turns out will spin things in such a way as to hide or confuse the public to the point that it is hard to understand what is actually happening.

This reminds me of George Orwell's book "1984," which when I went to high school was mandatory reading but, taking a quick survey in my office, none of college-educated 20-somethings had even heard of it.

Orwell wrote it in 1948 and flipped the date for the book about the future. Orwell's Thought Police make not just doing something but thinking something illegal a "thoughtcrime."

Fast forward. We call those "hate crimes" today. That is where our criminal justice system adds additional penalties to crimes not for what you did, but what you thought about while doing what you did.

In "1984," Big Brother used language to control people. War means peace, freedom means slavery, and ignorance means strength. By changing the meaning of words, Big Brother renders the populace incapable of seeing what is really happening. It's not that much different today.

When talking about health care, the left wing says there is a "right to health care," that everyone should have it even if that means it has to be free to some and, therefore, cost more for everyone else.

When talking about the immigration bill stalled in the Senate, the left uses phrases like "path to citizenship," "family unification" and "orderly process," when in fact the real issues are overcrowded schools, overflowing emergency rooms and downward pressure on the wages of workers who are here legally.

But let's talk about an issue closer to home. Two weeks ago, I wrote about the chance we might lose the back nine of the Newport Beach Golf Course because of the expansion plans for John Wayne Airport. Elections have consequences, and we in this part of the county are about to feel them. The fight for an airport at El Toro Marine Corps Air Station is over, the runways have been torn out, and the south part of the county has won its "Great Park." It has to bother you a little that the plan for a park at El Toro has now become the great housing project with traffic, people and pollution, that south county said they were trying to avoid by not having an airport.

But just like in "1984," changing the meaning of words is everything. Not many people would have voted for the "Great Housing Development," so just call it the Great Park.

The original plan pitched to county voters was 4,700 acres of "urban regional park and a variety of agricultural, material recovery/recycling, recreational, cultural, educational, employment, public and housing land uses." Once the measure passed and the county let Irvine annex the base, Irvine rezoned it to 3,700 homes, an industrial/office park, some retail and the now much smaller park.

Based on Irvine's new zoning, the federal government (read federal taxpayers) sold the property to the highest bidder in four parcels. Two parcels had only one bid. Subtract out the industrial and retail piece and the property sold for less than $90,000 per lot.

To put that in perspective, I bought lots in 1989 for $90,000 to build $300,000 homes. Needless to say, Lennar, the winning bidder, made a killing.

But something interesting happened on the way to developing what is now call Heritage Fields. The cost of building the Great Park went out of control. The park's cost, which started at less than $200 million, was now approaching $1.5 billion and rising.

The only way to pay for it was more park fees. That's when the city pulled another trick out of its hat. Officials rezoned the one parcel, which had only one bidder, to residential and allowed Lennar an astounding 5,800 additional homes for a total of 9,500 homes. To put it another way, $42,000 per lot.

Well, you might think who got taken on that deal. Do you think the bids might have been higher if builders knew they could build 9,500 homes instead of 3,700?

Instead of $640 million to the United States Treasury, it would be more like $1 billion.

Which brings me back to the use of language. If you go to the Heritage Fields website (www.heritagefields.com), you will find little if any reference to housing.

The nonpublic part of the property was broken into three districts: The Park District, The Lifelong Learning District and the Transit Oriented Development District, all three of which, if you didn't know it already, are 9,500 units of high-density housing.

Nowhere on the website does it talk about dense housing, just "neighborhoods designed for a creative class" of people who seek a stimulating environment."

Saturday, June 2, 2007

The Costs of 'Free' Health Care

What is it about the health-care system in America that makes politicians think they can fix it by giving it away to more people for free? Remember Economics 101, Rule No. 1: Whenever you price something at less than it costs, people will use more of it than they need. This is true whether you subsidize cars, corn or health care. Rule No. 2: People will not buy something for what it's worth if the government will give it to them for free. Rule No. 3: If you charge people more when they can get it elsewhere less expensively, then they will get it elsewhere.

With this in mind, let me tell you what are our caring politicians are cooking up for us in Sacramento. Assembly Speaker Fabian Nunez (D-Los Angeles) has proposed a bill that has three main aspects that I will focus on.

First, it gives free or almost-free health insurance to families that make up to 300% of the federal poverty level, which is $61,950 per year ($31 per hour) for a family of four.

Secondly, this grand idea will be paid for by every business in California that has more than two employees and a payroll over $100,000 per year, with a 7.5% additional payroll tax on employers who do not provide health insurance to all employees and their dependants. When did it become the responsibility of business owners to provide health care to everyone?

Lastly, the Healthy Families Program, which is a state program that uses federal funds (paid for by you, the taxpayer) would, "delete as an eligibility requirement … that the child must meet citizen and immigration status requirements." By the way, the program is already running in the red and will spend $3 billion more than it takes in within just five years, so trying to add 1 million children of illegal immigrants may not be the best idea.

So let's look at the consequences of this brilliant solution.

1) Do you think people will use more or less health care if it is free than if they had to pay a portion of it? Think about it: You have a runny nose? Go to the doctor — heck, it's free! Hurt your ankle? Let's do an MRI — hey, it's free! The fact is, consumers like you and me need to be invested in our own health.

2) People who are now paying for their own health care as responsible parents and adults will quit paying for it and get it free from the government. Do you think that might wreck the assemblyman's budget when the already self-insured jump on board the government gravy train? Also, do you think you might get a few more people to come across the border if they get free health care, no questions asked? Heck, why not bring the whole family? It's free!

3) Let's say I am a widget maker in California and you charge me an additional $5,000 per year for every $31-per-hour worker I have, compared with say Arizona, Nevada or Texas. You can bet that over time I will take my widget factory and that $31-an-hour job to Arizona, Nevada or Texas. This leaves California with more people on free health care and less jobs to support them.

In the end, it does what all socialized health-care systems in the world do where health care is "free": Use goes up and the price goes out of sight. Next, the government has to ration it out. One-year wait for a hip replacement, unless you are over 68 and then they rationalize that the benefit to society is not that important if you walk anymore or not. Next thing you know, we are discussing doctor-assisted suicide as a way to cut costs. This is not fiction. Any European will tell you that it is happening in Europe today.

Now, it may not be perfect, but the United States of America has one of the finest health-care systems in the world. And I know enough that "free" healthcare is the most expensive health care you can get.