It's still all about money

Taxes, economy top concerns for some in Lowcountry

As the 2008 presidential primaries get closer, The Post and Courier is taking a close look at some of the biggest issues as seen through the eyes of Lowcountry residents. This installment looks at the economy and taxes.

Marquette Map knows how it feels to be downsized after he was laid off from his job as a systems engineer in Atlanta seven years ago.

But Map considers himself lucky because his father-in-law pulled strings and landed him a job on Charleston's docks. He worked his way up to a job inside the International Longshoremen's Association hall, where he decides which of the union's 800 workers will work which ships.

"I'm responsible for work orders, where guys are going to work at," he said. While business is good and longshoremen's incomes can reach the six figures, he's concerned about the future.

He is concerned about his own retirement and about how much money others are making — and how far it stretches to buy health care and housing.

"I don't know if I'll have Social Security to look forward to. That's why I'm trying to invest my money now while I'm young," he said.

His wife, Michelle, works for the Lowcountry Housing Trust, so he knows how difficult it has been for many in the Lowcountry to find a decent home. While he has had a chance to meet with Democratic contender and U.S. Sen. Barack Obama, Map said he still is keeping an ear out for a candidate who will talk about pocketbook issues.

"To be honest with you, I haven't heard that speech yet. I'm interested in hearing that," he said. "I'm only hearing about Iraq and about health care. ... I see a lot of holes. I see a lot of things that aren't being addressed."

While he feels confident about his future, "I'm more concerned about what we're going to do about a guy who's a systems engineer who doesn't have a father-in-law to take care of him."

* * *

Mallory Factor, a Charleston businessman who runs an independent merchant bank and financial relations consulting business that advises companies nationwide, says while some economic indicators look rosy, there is cause for concern.

The nation's gross domestic product has been boosted by the war in Iraq and Hurricane Katrina recovery, two economic activities that Factor likens to fixing broken windows.

"If you break your neighbor's window and hire your other neighbor to fix the window, you have created economic activity and increased GDP, but you have not increased the capital stock," he said. "Increases in the GDP can be misleading."

Factor, who also is a co-founder of the Monday Meeting, a fiscally conservative political group in New York City, knows all the candidates, particularly the Republicans, but has been disappointed by how little Republicans did to control spending when they were in charge.

"We cannot spend like drunken sailors and expect other nations are going to continue to send us their cars and clothes while we send them a lot of green paper," he said. "Eventually, we've got to send them more of our goods back or face a trade and monetary crisis."

"Why in the world don't we take budget surpluses and instead of spending them on Dr. Seuss Museums and bridges to nowhere, instead put them in private accounts for people to save Social Security in the future?"

While America has driven the world economy, its pre-eminence is rapidly fading. He noted that some United States jobs outsourced to India are now coming back home as the dollar falls. "It's actually cheaper to do the work here in some cases," he said.

* * *

Philip Byrd also senses the American economy is weaker than many realize, because he closely tracks goods shipped over the nation's highways.

The president and CEO of Bulldog Hiway Express, a trucking company based in North Charleston, Byrd says the volume has dipped, especially because of lulls in the steel- and car-making industries and the homebuilding sector.

"By and large, I think the trucking industry is a good barometer of the U.S. economy," he said. "There is, without a doubt, in the trucking sector a substantial downturn in steel and building material."

He can cite other factors, such as the pace of homebuilding in Mount Pleasant, which planned to limit new home permits to 620 in 2007, but three quarters of the way through the year, almost 500 permits are still available.

Byrd also is concerned not only about the deterioration of the nation's roads, best exemplified by the Interstate 35 bridge collapse in Minneapolis this summer, but about congestion.

"We have congested pockets that cost us productivity every day. It equates to huge dollars in lost production and fuel expenses and environmental issues," he said. "I don't know of anything that's being done to address that in a comprehensive way."

As the volume slows, other costs are rising sharply. Diesel prices have risen from less than $2.60 a gallon earlier this year to $3.04 today, and federal air quality regulations mean that new trucks not only cost at least $10,000 more but also get worse gas mileage — about 6 miles per gallon instead of 7.

"In the first eight months of the year, our fuel costs are up $125,000 over 2006," he said. Meanwhile, he said illegal immigration is forcing health insurance costs up, trucks from Mexico are posing new competition as they are entering the U.S. market, and it's unclear when the housing and manufacturing sectors will rebound.

"There are a lot of challenges facing us right now in this industry," he said. "What I hear is the economy is pretty robust, all things considered. I'm not seeing any of the presidential candidates speaking to the fact that we've got to get the economy cranking and growing again."

* * *

Jack Jackson, a Summerville painting contractor, said he is concerned about the nation's future because its growing debt will saddle the next generation, including his 29-year-old twins.

His small business, Painting Plus Inc., employs fewer than 10 workers, and much of Jackson's time and energy go toward complying with the tax code.

"Tax reporting is the worst of it," he said. "Any particular form is not that terrible, but it sort of compounds, and, of course, if you make a mistake, you're hit with penalties and interest."

He noted that the federal tax code has gone from 400 pages in 1913 to more than 60,000 pages today.

"I can't even estimate what my tax liability is going to be until the accountants are done with their adjustments, and I've had a number of accounting courses which I passed."

He has joined the push for a Fair Tax, one of the biggest grass-roots movements on South Carolina's presidential political scene. The Fair Tax essentially would scuttle the income tax and replace it with a nationwide sales tax of about 23 percent. To protect the poor, the government would send monthly checks to everyone to rebate taxes collected on spending up to a certain point.

It's a complicated idea, but one that Jackson hopes will gain traction as the campaign wears on.

"As an individual, I'm intrigued with a couple of candidates. I want to see how the campaign goes and see if they stay focused or start drifting," he said. "The candidates that are willing to tackle dysfunctional government under the Internal Revenue code also will be willing to tackle entitlements."

* * *

Jackson is friends with John Steinberger, a Mount Pleasant school teacher who had an eye- opening experience in 1998 when he and his wife sold some mutual funds to pay for a home improvement project.

"We had to pay somebody $500 just to figure out what our tax liability was," he said.

Not long afterward, he was surveyed by Americans For Fair Taxation, a nonprofit group trying to find the best way to revise the federal tax code. The timing was perfect, and Steinberger became a believer and soldier and eventually a general in the Fair Tax movement.

Currently, this middle school teacher at Palmetto Christian Academy spends about 20 hours a week directing the Fair Tax movement in South Carolina, a movement that brought together about 8,000 supporters for a rally in Columbia on the night of the GOP debate there and is so numerous in their red, white and blue T-shirts at other events that some party officials fear them taking over.

"We definitely have enthusiastic support. There's no question about that," he said, noting that some supporters have traveled a few hundred miles a day to appear at political events. The group tries to have a presence at every presidential campaign event in the state.

Before taking on his current role, Steinberger worked to persuade First District Rep. Henry Brown, R-S.C., to sign onto the Fair Tax bill, and Brown did.

"That's a high intensity commitment people have to make this happen," Steinberger said. "I know we have many single-issue voters in our group. We're a diverse group. We have people who couldn't agree on any other issue than the Fair Tax."

Reach Robert Behre at 937-5771 or at rbehre@postandcourier.com.

Note to readers: The presidential candidates have floated many proposals about specific aspects of the economy, from tax reform to investing in new energy sources to tackling economic pressures on families.

Here is a quick look at the candidates’ positions, with links to their campaign Web sites.

Republicans

Sam Brownback

The top three issues on Brownback’s Web site include: taxes — he has pledged to oppose all tax increases and work to reform the tax code; Social Security, which he says faces a demographic crisis that must be fixed to keep the nation’s commitment to current and future retirees; and energy.

Brownback says the nation is on a verge of an energy crisis, and he would try to fix it by reducing oil consumption and using a market-based approach to expand renewable fuels. He also pledges to support American farmers by helping them produce biofuels, such as ethanol.

http://www.brownback.com/s/Issues/tabid/60/Default.aspx

Rudy Giuliani

Giuliani’s Web site begins with details on his positions to restore fiscal discipline in Washington by cutting wasteful or unnecessary programs and to cut taxes. “Rudy is the real fiscal conservative in the race. He cut taxes 23 times in New York and turned a $2.3 billion budget deficit into a multi-billion dollar surplus, while balancing the city’s budget,” his Web site says.

http://www.joinrudy2008.com/issues/

Mike Huckabee

Huckabee’s campaign visit to Mount Pleasant this summer essentially was a rally for the Fair Tax, which he supports. His Web site says, “I’d like you to join me at the best “Going Out of Business” sale I can imagine — one held by the Internal Revenue Service. Am I running for president to shut down the federal government? Not exactly. But I am running to completely eliminate all federal income and payroll taxes.”

http://www.mikehuckabee.com/index.cfm?FuseAction=Issues.View&Issue_id=5

Duncan Hunter

Hunter’s Web site talks extensively about his views on reforming taxes and notes that government’s taxation is a big contributor to poverty. Hunter supports a balanced federal budget, with additional revenue provided by economic growth, not increased taxes. He also would work to reduce tax penalties for married couples and to reform the Alternative Minimum Tax.

http://www.gohunter08.com/inner.asp?z=4

John McCain

A staple of McCain’s stump speech is a quip about how Congress spends money like drunken sailors and how a self-described former drunken sailor wrote him a note complaining about being compared to members of Congress. “As president, John McCain will work to ensure that money spent by Congress, and contributed by hardworking American taxpayers, is used wisely and prudently on legitimate national priorities, not squandered on wasteful pet projects and special interest earmarks,” according to his Web site, which lists several other specific approaches he would take to cut spending and lower taxes.

http://www.johnmccain.com/Informing/Issues/4a3ab6fe-b025-42b1-815b-13c696a61908.htm

Ron Paul

Paul’s Web site says he “is the leading advocate for freedom in our nation’s capital. As a member of the U.S. House of Representatives, Dr. Paul tirelessly works for limited constitutional government, low taxes, free markets, and a return to sound monetary policies. He is known among his congressional colleagues and his constituents for his consistent voting record. Dr. Paul never votes for legislation unless the proposed measure is expressly authorized by the Constitution.”

http://www.ronpaul2008.com/issues/debt-and-taxes/

Mitt Romney

Romney’s Web site says the nation’s tax code “is a labyrinth that imposes an enormous and unnecessary burden on our citizens and employers. Keeping taxes low and simplifying the code will grow the economy and enhance our competitiveness.” As for spending, it says, “America must stop its borrowing and spending binge. The debt is a burden on our economy, our currency, our foreign policy, and our future. This is beyond pork barrel spending. We must address entitlement programs ­— not just to save money — but to give Americans confidence in their future.”

http://www.mittromney.com/

Tom Tancredo

Tancredo’s Web site says he supports the Fair Tax, reforming Social Security and other entitlement programs and curbing the president’s powers to make fast-track trade deals. “Instead of sticking to trade agreements, they make commitments on matters of domestic policy, like immigration and carbon dioxide emissions, in the guise of international accords,” it says.

http://teamtancredo.org/tancredo_issues_index.php

Fred Thompson

Thompson’s Web site details his positions for reforming both taxes and spending, noting, “In a few short years—not a generation from now—a fiscal tsunami that could imperil our security and economic prosperity will hit our nation and place an unfair burden of debt on our children and grandchildren.

The tens of trillions of dollars in debt that will be accumulated over the next few decades will do immense harm to our economy. This burden is now estimated at $170,000 per person and $440,000 per family. Time is running out to address this looming crisis. We need market-based approaches to reform that guarantee benefits for those who need them and embrace personal responsibility and cost-effectiveness without raising taxes.”

http://www.fred08.com/Principles/PrinciplesSummary.aspx?View=OnTheIssues

Democrats

Joe Biden

Biden’s Web site notes he supports a “Pay-as-you-go budget” and that he fought against President Bush’s tax cuts. On the jobs front, he offers several specifics for helping American workers. “Every day we see more evidence this economy is not working for middle-class Americans. If we honor work, we have to reward it,” he says.

http://www.joebiden.com/issues?id=0019

Hillary Clinton

Clinton’s Web site says, “America’s middle class is under siege and ready for a change. People are working harder and longer for less and less.

Corporate profits are up. CEO pay is up. Wages are lagging. Household debt is soaring. At the same time, health care, energy, and education costs are rising. Last year, more people went bankrupt in our country than graduated from college.”

Her economic plan touches on many other issues, such as making health care affordable; reducing energy costs; expanding affordable child care; making college more affordable; protecting families from predatory lenders and increasing the minimum wage, balancing the federal budget and providing greater retirement security.

http://www.hillaryclinton.com/issues/middleclass/

Chris Dodd

Dodd’s Web site discusses what he would do to provide more retirement security for seniors, how he would push for a Corporate Carbon Tax to reduce energy costs, how he would revitalize rural America and how he would improve relations between workers and employers.

http://chrisdodd.com/issues

John Edwards

A central theme of Edwards’ campaign is how there are now “two Americas.”

His Web site notes, “In today’s Two Americas, it is no coincidence that most families are working harder for stagnating wages when there are nearly 60 lobbyists for every member of Congress. ... Building One America will take strong, bold steps, not incremental steps and half measures. Edwards has proposed detailed plans to put Washington back on the side of regular families.”

http://johnedwards.com/issues/

Mike Gravel

Gravel is the only Democrat supporting the Fair Tax. His Web site says, “Senator Gravel’s Progressive Fair Tax proposal calls for eliminating the IRS and the income tax and replacing it with a national sales tax on new products and services. To compensate for the tax on necessities, such as food, lodging, transportation and clothing, there would be a ‘rebate’ to reimburse taxpayers. “This would be paid in a monthly check from the government to all citizens.” He also has a plan for protecting Social Security.

http://www.gravel2008.us/issues.php

Dennis Kucinich

Kucinich would end the United States’ involvement in NAFTA and the World Trade Organization. “For most American families, the loss of a job or one serious illness spells catastrophe. Stagnant wages, expensive health care and rising education costs are vital issues being ignored by the Congress and White House. A champion of working families, Dennis Kucinich will lead America into expanding opportunities, universal health care, restore our schools and strengthen Social Security and protections for private pensions,” his Web site says.

http://www.dennis4president.com/go/issues/

Barack Obama

Obama’s Web site notes there are 37 million poor Americans. “Most poor Americans are in the workforce, yet still cannot afford to make ends meet.

And too many poor Americans are single mothers who are raising children.

Barack Obama has been a lifelong advocate for the poor — as a young college graduate, he rejected the high salaries of corporate America and moved to the South Side of Chicago to work as a community organizer. As an organizer, Obama worked with churches, Chicago residents and local government to set up job training programs for the unemployed and after school programs for kids.”

His plan for change includes providing new jobs, training workers, combatting mortgage fraud, improving education, reforming taxes, lowering health care costs and separate ideas for tackling urban and rural poverty.

http://www.barackobama.com/issues/fightingpoverty/

Bill Richardson

Richardson’s Web site says, “Our country faces a great economic challenge.

Increasingly, highly-skilled workers across the globe are competing for — and winning — the most desirable jobs available. Many of these workers come from nations with governments that have made the three essential choices that grow economies and create jobs: 1. They are choosing to invest in the future rather than spending extravagantly on present-day consumption; 2. They are investing in science and technology; and 3. They are investing in their workers through education and workforce development.”

His ideas include restoring fiscal discipline in government, investing in technology and protecting the American workforce.

http://www.richardsonforpresident.com/issues/jobs_and_the_economy/

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