Reasons to Fondly Remember June of 2012: Wisconsin and Minnesota Leadership

Update for June 18, 2012:a great letter in the WSJ this morning from Thomas K. Trecker of Prior Lake, MN reminds us all that while we are glad our full Congressional delegation supported Rep. Erik Paulsen's repeal of the medical device tax, some of those very same people let it happen in the first place. Mr. Trecker makes a strong case that Sen. Klobuchar in particular could have stopped the bill--and reminds of us her enthusiastic support for Obamacare.

For the second time this week my faith in the future and my fellow citizens has received a big lift. The first was the embrace of fiscal sanity by the people of Wisconsin. That’s kept me walking a few feet off the ground and singing out loud all week. I keep asking my teens if they understand how important this is, that this means there is a chance they might not be working to pay off government debt most their adult lives. (“Yes, Mom, we get it. Please stop repeating yourself—and please do not sing in public!”).

Then the U.S. House did a great thing just two days later; they voted to repeal the 2.3% excise tax that threatens to tank Minnesota’s medical device industry—and our recovery from the recession. The bill, Protect Medical Innovation Act of 2012, sponsored by Congressman Erik Paulsen (R-03), passed with bi-partisan support 270-146 with 37 Democrats joining the majority.

Any tax would be a bad idea, but this one is especially pernicious because it taxes sales rather than profits. Imagine what that does to a start-up or any company operating on a tight margin—or the appetite of any company to hire new people. Just remember one of the simple principles of taxation: if you want less of something, then tax it.

Citing the fact that this is one of the most innovative and productive sectors of Minnesota’s economy, all eight of our U.S. Representatives voted to repeal the tax. Normally, however, that would not be enough to get a “yes” vote from all the Democrats we send to DC. Rep. Colin Peterson? Maybe. But the rest of them? I know how I would bet.

It is an election year, and these folks want to keep their jobs. What about Senators Klobuchar and Franken? They are quibbling, saying they want repeal but coming up with reasons not to support Paulsen wholeheartedly (see Minn Post). Do not ever doubt the power of your vote.

The Wall Street Journal felt it was noteworthy enough to name each of the four Minnesota Democratic defectors from the Obama party line---I had to check the roll call to see it myself. There they are in black and white: Ellison, McCollum, Peterson and Walz.

Recall that the tax was passed to generate billions in revenue to help “pay for” Obamacare. Robbing from Peter to pay Paul. Now that’s bad tax policy.

We are all holding our breath, waiting to see how the Supreme Court rules on Obamacare later this month. Will it uphold a view of the Commerce Clause that completely erases the fundamental promise that the federal government has limited, enumerated powers? Will it strike down the individual mandate, but leave the rest of the job to Congress? Or will it strike down the whole law?

(There is a remote chance the Court will follow the lead of DC Circuit Court of Appeals Judge Brett Kavanaugh and avoid the decision by ruling that the case is not ripe for decision until 2015 when taxes under the law have kicked in.)

The Free Market Institute at the Center proudly joined more than half that states in an amicus brief arguing that the individual mandate was unconstitutional.   

Let’s hope I am floating on air for the Fourth of July—and singing so much that my teens threaten to disown me.