Problems With Patriot-News Eds on Severance Tax

The Patriot-News editors seem to think Pennsylvania is a “laughing stock” for its failure to enact a natural gas severance tax.  I can’t say I’m 100% philosophically against any sort of severance tax or local impact fee (– “po-TAY-to” / “po-TAH-to”) for a demonstrated, genuine economic externality that is not addressable by current law, and is unique to gas extraction, but the editors have been particularly lazy in their arguments.  They attack “special interests” without considering the fact that they are proposing a “special” tax.

P-N Eds:

As if anyone in Pennsylvania needs a reminder, we are the only natural gas producing state that does not have a severance tax.

So what?  (If your friends all jumped off a bridge…)

P-N Eds:

In Pennsylvania, our legislative leaders decided not only to continue to allow drilling (including in our precious state forests), but to give away our natural resources for less than any other state.

The lowest cost state should receive a disproportionate amount of investment.  Sounds to me like it’s a good idea to be the lowest cost state.  (We already know that “political problems” impeded gas exploration under Governor Ed.)  And of course, by “give away our natural resources”, we mean “collect leasing fees” and other taxes incurred in the normal course of business.

P-N Eds:

For the record, passing this severance tax is about a lot more than simply helping to fill the state’s budget hole — estimated to be $5 billion next year — as Republican gubernatorial candidate Tom Corbett claims.

Actually, budget revenue should be ZERO percent of the reason for any severance tax.  The editorial board seems to leave room for the claim that just because somebody is going to make money, that the state is entitled to confiscate some of that money above and beyond what the energy companies would pay in normal business taxes.

P-N Eds:

It is about ensuring Pennsylvania’s picturesque landscape and communities are not unduly burdened without any financial recourse. It is also about ensuring that gas drillers — most of which are multibillion-dollar corporations — pay their fair share for taking a resource that belongs to all Pennsylvanians.

Again, the energy companies are paying leasing fees.  If they should happen to sully the landscape, there is already legal recourse against developers.

Only that gas which is under state land “belongs to all Pennsylvanians”, and the state is being compensated in the form of leases.  Gas found under private land doesn’t belong to all Pennsylvanians, but to those who own the mineral rights to that land.  And even in the case of private land development, the state still gets to tax the sale or lease transaction as it would any other business.

Show me a genuine economic externality (– not the phoney-baloney stuff that’s been making most of the headlines) that is not addressable by current law, and that is unique to the gas industry, and I’ll support a gas tax/fee, and only insofar as the money never goes through Harrisburg and only addresses economic externalities from gas.

Otherwise, I’m all in favor of being the lowest cost, lowest taxed state for natural gas.  It is the high-tax states we should consider laughing stocks.

April 25, 2011 at 3:45 pm Comment (1)

Backroom Contract Deals


Pennsbury school board members Simon Campbell and Allan Weisel – part of a minority of four board members – were looking Thursday when an unpublicized meeting of contract negotiators almost occurred. We say almost because Campbell and Weisel, being outcasts, are not the board’s official negotiators. So when they showed up to “observe” the session, representatives of the teachers union took their proposal and went home.

Taxpayers should be OK with that, maybe even thankful. While some will characterize Campbell and Weisel as obstructionists and troublemakers, in our view they were standing up for the public’s right to know.

One of the problems with the way teachers contracts are negotiated – if not the biggest problem – is secrecy. A board negotiating team meets with union representatives sometimes for months or even years to hammer out a labor agreement. The sessions are closed to the public and not much of what negotiators agree to is communicated to the people who will pay for the deal – taxpayers – before the full school board gives its “tentative” approval. Likewise, union officials keep the deal under wraps until teachers vote.

I didn’t realize the contract negotiations were with only a few of the board members. I still blame them all.

April 25, 2011 at 1:23 am Comments (0)

The Fracking Debate

April 24, 2011 at 2:47 am Comments (0)



PHILADELPHIA (CBS) – Police have two women in custody and are searching for a third male suspect involved in a burglary that took place at a Philadelphia pizzeria Saturday morning. Police say at about 9 a.m., a white male in his thirties crashed his blue Ford Explorer into Aldo’s Pizzarama located on the 10000 block of Bustleton Avenue in northeast Philadelphia. He allegedly took the cash register which contained about $300 and fled the scene in his vehicle occupied by two other females, according to police. Philadelphia police chased the vehicle down Byberry Road until it crashed in Lower Moreland Township, Montgomery County.

The male suspect fled the scene, but police say the two female occupants were injured and trapped in the car when officers arrived. They were taken to a hospital for treatment, but police say they will be charged. Police have issued a warrant for the arrest of the male offender who remains at large. LINK

Ok- Aldo’s is my neighborhood pizza place. I have been getting Aldo’s pizza since I was a kid and it is still the best pizza in N.E. Philly hands down. It is in the top ten city-wide that’s for sure, maybe even top five. It grates my soul that there are frigging animals like this roaming free. It also grates my cheese that this is just another sign of how Philly and most other big cities are deteriorating before our eyes. Crime is out of control and is now prevalent in every part of the city. Police Comisar Ramsey just got a big fat 60K a year raise and I’m pretty sure he couldn’t find Aldo’s with a map. There are fewer and fewer livable neighborhoods anymore in Philly.

The best part of this story is that these scumbags were caught in Lower Moreland, that’s outside Philly. They will no doubt get more time for fleeing and eluding in Montgomery County than they will for the original burglary in Philly. HOORAY! I hope they rot. I’ll be getting some Aldo’s this week to show my support for this outstanding local business.

April 23, 2011 at 11:58 pm Comments (0)

Because “Kiss My A**” isn’t a polite response

But it is full of teh awesome nonetheless (h/t Grassrootspa)

The long and short of it is that Reps. Schroeder and Vereb are creating a whistleblower website where people can report illegal activity by employees of Pennsylvania’s gaming industry. The PA Gaming Control Board is shocked, SHOCKED I tell you, that the House committee which oversees their activities would be so…impertinent.

Says the Gaming Control Board:

If you are aware of any criminal activity that has been perpetrated by any of our employees, we demand that you immediately provide us information on that criminal activity so that we may take appropriate action to assure that our duties as the regulatory authority over the gaming industry in Pennsylvania are not compromised. Any refusal on your part to provide this information only makes you complicit in undermining the integrity of gaming, which you so strongly allege is occurring.

Says Rep. Mike Vereb:
Bite me.

Or, alternately:

Vereb responded that the board has a “”better chance of the Easter Bunny visiting them on Sunday than they have of me turning anything over to them.”
“But there is not a chance,a probability or any likelihood that either one of us will turn over any information that has a criminal taint to it to the same agency who has done nothing about some of the very complaints for the last few years,” Vereb said.

Magnifying the awesome is the fact that former Speaker of the House and tax-hiking BFF of Ed Rendell, Keith McCall sits on the Gaming Control Board.

Former. Ha.

April 22, 2011 at 11:10 am Comments (0)

Scarnati: Release Funds from Legislative Surplus

via Micek

Senator Scarnati has introduced a bill to release most of the legislative surplus into the general fund.

What’s the legislative surplus, you might ask?  Each year the legislature appropriates more money to itself than it intends to use, and just pockets the rest into a slush fund that is more or less beyond the reach of any authority other than the legislature itself.

The surplus is up to about $188.5 million.

Doesn’t that sound rather shady?  It does to me.  Even if one can rationalize the existence of the surplus, the magnitude has reached a profane level, and is completely unjustifiable given the state’s budgetary constraints.

April 21, 2011 at 2:40 pm Comments (0)

Harrisburg Is Full of Shit.

“Yeah Alex, we already knew that.”

I agree, but that was a figure of speech.

Now it’s straight up for realz.

After Gov. Corbett reopened the Capitol after two days of its being shuttered because of a ruptured water main, the 16,000 state employees arrived to toilets that still didn’t flush, and faucets that spouted little or no water.

An e-mail waiting in workers’ inboxes from the state’s Office of Administration informed them that there were portable toilets – 20 in all – stationed around the Capitol complex. It exhorted workers to use them.

“It’s all people have been talking about this morning,” said Dennis Peachey, a manager in the state’s Office of the Budget, as he waited to use the blue loo positioned outside his building. “There’s really not a lot of work getting done.”

By noon, the situation began reaching crisis proportions, as word spread that there were “sanitation issues” in some bathrooms. By 1 p.m., Corbett had ordered nonessential employees to go home. The House dismissed its staffers, too, although the Senate decided to tough it out.

Next time you see you’re friendly lawmaker you can ask, “Hey, are you guys still full of shit?”

(… and you too can be a clever blogger!)

April 20, 2011 at 9:34 pm Comments (0)

Metcalfe & Right to Work

Moe Lane at RedState interviews State Rep Daryl Metcalfe to discuss his right to work bills in Harrisburg.

Only six minutes.

April 20, 2011 at 1:14 am Comments (0)

Joke Budget Deals Lead To S & P Credit Warning

It is a sad truth that America has been transformed from a tough-as-nails powerhouse into a nation that prefers to bury its head in the sand, pretending problems will go away if simply ignored.  Being the world’s only superpower, the United States has gotten away with that dangerous mentality for years.  But now it is finally time to pay the piper, yet Congress’ continued lack of action has pushed America to the brink of insolvency.

America’s debt (the total amount owed) stands at $14.3 trillion, and its deficit (the amount of red ink incurred just this year) is nearly $1.7 trillion. 

As a comparison, the 2011 deficit equals the ENTIRE budget in 1999.  In other words, we are borrowing more this year than all government expenditures for all of 1999.

The recent effort to “rein in spending” by cutting $100 billion from the current budget turned into a $38 billion compromise. But the independent Congressional Budget Office concluded that the actual savings were just one percent of that, a mere $352 million.

Since trillions and billions are meaningless, incomprehensible terms (a point not lost on those wishing to confuse the public), it makes sense to break down America’s dire fiscal situation in real world terms.

Let’s say the Debt and Deficit Restaurant (D & D) wants to dramatically expand, something it has done each year for decades. Despite the fact that D & D is already stretched thin because of its numerous loans for past expansions, and the fact that the debt-holders are starting to view its mounting debt warily, there is faith that it will pay its bills, and financing is once again approved.

For its current operating year, D and D’s revenue is $21,000 (equivalent to the nation’s $2.1 trillion in tax receipts). Not enough to satisfy the owners (Congress), another $17,000 (our $1.7 trillion debt) is borrowed to buy everything else they want but can’t afford.  The restaurant already owes a staggering $143,000 to its creditors ($14.3 trillion debt), but the owners, rather laying off employees or downsizing, think the best action is to borrow more and expand anyway, ignoring the fact that skyrocketing interest payments now account for a huge percentage of revenue.

Some D and D patrons (the electorate who voted the GOP into power), foreseeing the negative impact of that strategy, have suggested that the owners cut back and make hard decisions that, while painful, are necessary if the five star restaurant is not to become a fast food joint, or worse, close its doors altogether.

Reluctantly, the owners agree.  At first, they commit to cutting about 6 percent of the $17,000 they borrowed this year, equating to $1000 (the original $100 billion figure), not enough to make a dent.  But upon reconsideration, they lack the courage to commit, and settle for a cut of $340 (the $38 billion compromise).

The owners are quite happy with their self-proclaimed business acumen, but an independent auditing firm (CBO) concluded that the cuts actually amount to less than one percent of the $340 compromised figure!

So D and D’s “solution” to its impending disaster is to cut three dollars out of the $17,000 owed this year, resulting in its total debt ballooning to $160,000 (the debt will rise to $16 trillion next year because the deficit was not reduced). 

It doesn’t take an economist to see that D & D will soon become insolvent. In real life, D & D would have failed long ago, but the U.S. government has been printing money to stay afloat.  But inflation is now rising, and interest payments on the debt will soon consume so much tax revenue that basic government functions will go unfunded.

Here’s what the political class is missing. It makes absolutely no difference whether it’s conservatives or liberals making excuses for lack of cuts and justifying budgets deals, and it doesn’t matter how much merit their programs have.

Two plus two always equals four, whether or not we believe it. For all practical purposes, the United States’ insolvency it is a mathematical certainty, short of monumental change.  Could the iceberg be averted? Sure, but the political will simply isn’t there from either Party to steer the ship to safety. From forsaking energy independence to raising debt ceilings to treating entitlements as sacred cows, the lack of inaction has led the Republic to the edge of the abyss.

And as Lou says to Charlie Sheen’s character in Wall Street: “Man looks in the abyss, and there’s nothing staring back at him. At that moment, man finds his character. And that is what keeps him out of the abyss.”

Standard & Poor’s downgrading of ourAmerica’s credit worthiness confirms that our nation is unquestionably looking into the abyss. The question is, do we possess the character to keep us out of it?

Chris Freind is an independent columnist, television commentator, and investigative reporter who operates his own news bureau,

Readers of his column, “Freindly Fire,” hail from six continents, thirty countriesand all fifty states. His work has been referenced in numerous publications including The Wall Street Journal, National Review Online, foreign newspapers, and in DickMorris’ recent bestseller “Catastrophe.”

Freind, whose column appears regularly in Philadelphia Magazine and nationally in Newsmax, also serves as a frequent guest commentator on talk radio and state/national television, most notably on FOX Philadelphia.  He can be reached at

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April 19, 2011 at 10:38 pm Comments (0)

Finally,…Nuts to Nutter-delphia!

No wonder Featherman isn’t the “official” Republican candidate for mayor, he actually intends to fight!

Gaddafia-adelphia vs Featherman

April 19, 2011 at 8:34 am Comments (0)

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