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E-News December 3, 2010


Location: Unknown

1) The Week Just Past: Bipartisanship? Only Time Will Tell

2) One Week Closer to a Massive Tax Increase

3) Obamacare's tax-filing requirement survives Repeal Effort

4) Wikileaks: More Serious Than "One Guy With A Laptop"

The Week Just Past: Bipartisanship? Only Time Will Tell

"The President and the Leadership of the next Congress held their first face-to-face meeting this week. By all accounts, the meeting was described as "cordial' and "productive.' Hopefully, the two-hour session marked beginning of a new dialogue between the two parties.

"Of course, only time will tell, but the early signs are not encouraging.

"Our first priority should be to get the economy back on track in order to promote private sector job creation. We can take a major step in that direction by extending our current federal tax rates and preventing a huge tax increase on small businesses from taking effect on New Year's Day.

"However, rather than prioritizing economic certainty for American families and employers, Speaker Pelosi has prioritized a tax increase on small businesses, our nation's engine of economic growth, starting January 1, 2011. She forced a vote this week on a massive increase on America's small businesses and many families.

"Of course, there is no "good' time to raise taxes. But there are few worse times to hike taxes than in the middle of a very fragile recovery.

"The House bill has virtually no chance of becoming law. The debate on Thursday was just more political theater.

"We can only hope that a new spirit of bipartisanship will allow the President and his allies on Capitol Hill to come to an agreement to avoid one of the largest tax increases in history from taking effect on New Year's Day."

Rodney Frelinghuysen

Recommended Reading: Speaker-Designate John Boehner (OH) and Senate Republican Leader Mitch McConnell (KY) writing in Tuesday's Washington Post, "Where We and Democrats Can Work Together:"

One Week Closer to a Massive Tax Increase

Speaker Pelosi and her "lame-duck" Congressional Majority are showing "no signs of relenting" on their plan to impose a massive, job-killing tax hike on small businesses. In an effort to impose these tax increases, they staged a symbolic vote on Thursday in the House.

In the meantime, uncertainty continues to grip families and small businesses which are hesitant to make critical investment and hiring decisions. Many cash-strapped states are "in budget limbo." Tax conditions are also hurting charitable giving this holiday season. Economists -- including architects of the so-called economic "stimulus' bill -- agree on the need to stop all the tax hikes:

Noted economist Allen Sinai told the Associated Press this week that raising taxes on small businesses "could reduce the flow of money into private equity firms, venture capital and other investments that "grease the wheels of entrepreneurship in the U.S. economy.'" According to Dr. Sinai's estimates, stopping all the tax hikes "would provide the biggest boost to spending and growth. People and businesses would know they could count on the money in the future."

Economist Mark Zandi -- who's also worked with the current House Majority -- says the President's plan to raise taxes "will have an impact on small businesses…" He continues, "why take a chance when the recovery is so fragile? I think small businesses are very important to the job machine. Without them, the job machine can function, but it can't function well."

Recommended Reading II: Sarah Needleman writing in Thursday's Wall Street Journal: "Smaller Firms Still Hesitant to Hire:"

Obamacare's tax-filing requirement survives repeal effort

As of today, businesses are required to file a "1099 Form" with the Internal Revenue Service (IRS) for services performed by independent contractors that value $600 or more.

In the past, payments between businesses have not been required to be reported under a "corporate exemption."

Section 9006 of the President's new health care law removes this corporate exemption. While the requirement is supposedly starting in January of 2012, the paperwork requirement already appears to be having affects on businesses.

Now, both large and small businesses will be required to file a 1099 form for any purchase over $600.

This not only means a huge increase in paperwork for all businesses, but an incredible increase in data collection, with the increased chances that there will be lost data vulnerable to identity theft.

Rodney has cosponsored H.R. 5141, the Small Business Paperwork Reporting Elimination Act of 2010, which would simply strike this section of the health care law.

Efforts to repeal this onerous provision failed Monday in the Senate. Read the Associated Press story here.

Wikileaks: More Serious Than "One Guy With A Laptop"

Media reports indicate that the U.S. government is considering espionage charges against WikiLeaks founder Julian Assange and Interpol added him to its global wanted list.

At the same time, the White House seemed to dismiss activities of the world's most infamous leaker. The President's spokesman, Robert Gibbs, declared that the Administration is "not scared of one guy with one keyboard and a laptop."

Make no mistake about it: the website's leaking of 250,000 State Department documents is serious business. Beyond embarrassment, the leaks could harm U.S. foreign policy by making diplomats and other sources overseas reluctant to work with representatives of the U.S. government. The leaks also threaten U.S. intelligence operations and soldiers, sailors, Marines and airmen.

Among the ten questions it posed in an editorial on Wednesday, Investor's Business Daily asked:

"Attorney General Eric Holder says he's weighing charges against Assange and WikiLeaks under the Espionage Act. What has taken him so long? Assange has been working loudly against America for 18 months, releasing stolen documents on Iraq and Afghanistan for more than a year, amid reports of repercussions against U.S. allies. Shouldn't Holder have done something long ago?

"Chased out of Europe, Assange moved his server to Explain again why a U.S. company is facilitating this sleazy trafficker in stolen secret data without a court order to shut it down? Last week, the White House shut Web sites trafficking fake Prada handbags. Why does it do nothing here?

"A private hacker called the "Jester' claims he's successfully enacted a denial of service attack against WikiLeaks. But with all its resources, why hasn't the United States government blown WikiLeaks and all its mirror sites off the air instead? America's ally Colombia has destroyed FARC terrorist Web sites, taking info-terror as seriously as it takes jungle warfare. A Colombian embassy spokesperson told IBD the country has an unofficial military unit just for the purpose. And we don't?

"The New York Times, the U.K.'s Guardian, Spain's El Pais and Germany's Der Spiegel are working hand-in-hand with Assange, publishing his stolen documents, effectively serving as a backup to disseminate the documents even if WikiLeaks gets shut down. Why aren't these beneficiaries of freedom of the press who turn on its chief defender being prosecuted? News organizations such as CNN recognized this criminality for what it was and, unlike the Times, wouldn't touch the story.

"Why are there 3 million other people with security clearances who can not only see diplomatic cables but also download them?

"Where is the cooperation from other countries to bring Assange to justice? We thought President Obama would repair relations with so-called allies.

"Where, for that matter, is president himself? Amid a 9/11-grade attack on U.S. diplomacy, the WikiLeaks debacle calls for strong statements signaling that America will take actions to punish this determined enemy. But beyond bland boilerplate, and at a time that calls for resolve and action, Obama has said and done nothing."

Recommended Reading III: Mary Anastasia O'Grady writing in the Monday Wall Street Journal, "Obama's Trade Contortions":

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