Why I support Dan Liljenquist

Friends, I'd like to share with you why I support Dan Liljenquist. My decision to support Dan is based on my interaction with both Orrin and Dan before they started their campaigns -- not on anything that they have said or done as part of the campaign process.

My Experience with Dan the past 5 years:  

• Dan is not afraid to take on the big issues, like entitlement reform. As a freshman Utah State Senator, Dan told me he was going to take on state pension reform. I told him I thought he was crazy -- that he needed more time and "seniority" to put together such important legislation. Dan proved me wrong, and was successful at working with others to make structural reforms to the system, saving Utah Taxpayers billions over the coming years.
• Dan has real analytical "skills". As a former Bain consultant, he is not afraid to dive deep into the data and numbers on a specific issue. Dan does his research, gathers the facts, prepares his case well, and makes a clear logical, fact based argument for needed legislation. Like Paul Ryan and Mitt Romney, he has the financial and business skills necessary to help craft the reforms that are needed to get entitlement growth under control.  
• Dan an incredibly effective and persuasive communicator -- which is a skill needed to be a good consensus builder for important legislation. Dan has helped me to change my mind on issues, by presenting good data, and persuasively communicating his viewpoint.  
• People like working with Dan. When given a chance, people would rather work with positive, energetic, forward thinking people. If we are going to make the structural reforms that are needed in this country, it will come from the positive thinking, idea generating, risk taking legislators, like Paul Ryan and Dan Liljenquist -- not from long time Washington insiders.  
• He is a good listener and meets with stakeholders before finalizing legislation. When working on Utah State pension reform issues, he met repeatedly with UEA and other representatives of state employees. He talked upfront, openly and fairly with others about the needed changes, and made modifications to his ideas based on feedback and arguments from his critics.  
• Dan is committed to fair, feasible, and sustainable entitlement reform -- not to a long political career. He will get the job done, then move on to something else. He has committed to term limit himself. You can learn more at Dan's web-site at www.danforutah.com

My Experience with Orrin the past 8 years:

 I like Orrin Hatch and believe he has done many many good things for Utah over the years. He has provided good service to the citizens of Utah. As a former City Councilman, there were times when we tried to fight the bureaucracy of Washington on issues that impacted our city. Senator Hatch and his staff were willing to listen to concerns that were brought to their attention. I observed that Senator Hatch and his staff were not always willing to use his seniority or position to rattle cages or make changes unless it was politically advantageous for his office. If there was any chance that helping local cities on a specific issue might impact him negatively from a political perspective, my perception was that he was generally not willing to go very far out on a limb for us. I am not convinced that it is in Orrin's nature to make the unpopular choices that are going to have to be made to reform entitlement growth.

 Please take the time to vote on Tuesday June 26.
Polls are open 7AM to 8PM -- look up where to vote here: http://vote.utah.gov/

Respectfully,
Paul Cutler

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$3 billion wasn’t enough?

Thomas Friedman: $3 billion wasn’t enough?

By thomas l. friedman

The New York Times  Published: December 14, 2010 01:01AM

The failed attempt by the United States to bribe Israel with a $3 billion security assistance package, diplomatic cover and advanced F-35 fighter aircraft — if Prime Minister Bibi Netanyahu would simply agree to a 90-day settlements freeze to resume talks with the Palestinians — has been enormously clarifying. It demonstrates just how disconnected from reality both the Israeli and the Palestinian leaderships have become.

Oil is to Saudi Arabia what unconditional American aid and affection are to Israel — and what unconditional Arab and European aid and affection are to the Palestinians: a hallucinogenic drug that enables them each to think they can defy the laws of history, geography and demography. It is long past time that we stop being their crack dealers.

At a time of nearly 10 percent unemployment in America, we have the Israelis and the Palestinians sitting over there with their arms folded, waiting for more U.S. assurances or money to persuade them to do what is manifestly in their own interest: negotiate a two-state deal. Shame on them, and shame on us. You can’t want peace more than the parties themselves, and that is exactly where America is today. The people running Israel and Palestine have other priorities. It is time we left them alone to pursue them — and to live with the consequences.

They just don’t get it: We’re not their grandfather’s America anymore. We have bigger problems.

Israeli and Palestinian negotiators should take a minute and put the following five words into Google: “budget cuts and fire departments.” Here’s what they’ll find: American city after city — Phoenix, Cincinnati, Austin, Washington, Jacksonville, Sacramento, Philadelphia — all having to cut their fire departments. Then put in these four words: “schools and budget cuts.”I guarantee you, if someone came to these cities and said, “We have $3 billion we’d like to give to your schools and fire departments if you’ll just do what is manifestly in your own interest,” their only answer would be: “Where do we sign?” And so it should have been with Israel.

Israel, when America, a country that has lavished billions on you over the last 50 years and taken up your defense in countless international forums, asks you to halt settlements for three months to get peace talks going, there is only one right answer, and it is not “How much?” It is: “Yes, whatever you want, because you’re our only true friend in the world.”

Palestinian President Mahmoud Abbas, what are you thinking? Ehud Olmert, the former Israeli prime minister, offered you a great two-state deal, including East Jerusalem — and you let it fritter away. Now, instead of chasing after Obama and telling him you’ll show up for negotiations anywhere under any conditions that the president asks, you’re also setting your own terms. Here’s some free advice: When America goes weak, if you think the Chinese will deliver Israel for you, you’re wrong. I know China well. It will sell you out for a boatload of Israeli software, drones and microchips so fast that your head will spin.

I understand the problem. Israeli and Palestinian leaders cannot end the conflict between each other without having a civil war within their respective communities. Netanyahu would have to take on the settlers, and Abbas would have to take on Hamas and the Fatah radicals. Both men have silent majorities that would back them if they did, but neither man feels so uncomfortable with his present situation to risk that civil war inside to make peace outside. There are no Abe Lincolns out there.

What this means, argues the Hebrew University philosopher Moshe Halbertal, is that the window for a two-state solution is rapidly closing. Israel will end up permanently occupying the West Bank with its 2.5 million Palestinians. We will have a one-state solution. Israel will have inside its belly 2.5 million Palestinians without the rights of citizenship, along with 1.5 million Israeli Arabs. “Then the only question will be what will be the nature of this one state — it will either be apartheid or Lebanon,” said Halbertal. “We will be confronted by two horrors.”

The most valuable thing that President Barack Obama and Secretary of State Hillary Rodham Clinton could do now is just get out of the picture — so both leaders and both peoples have an unimpeded view of their horrible future together in one state, if they can’t separate.

It’s all a fraud. America must get out of the way so Israelis and Palestinians can see clearly, without any obstructions, what reckless choices their leaders are making.

Make no mistake, I am for the most active U.S. mediation effort possible to promote peace, but the initiative has to come from them. The Middle East only puts a smile on your face when it starts with them.

The Overseas Profits Elephant in the Room

There's a trillion dollars waiting to be repatriated if tax policy is right.

By JOHN CHAMBERS AND SAFRA CATZ

During last year's "Jobs Summit," President Obama said he was open to any good idea to get the economy moving again. Today he should be especially so, since Washington's many monetary and fiscal policy decisions have not been able to spur the robust growth or job expansion that we all would like. And yet there is a simple idea—the trillion-dollar elephant in the room—that has apparently been dismissed for no good reason.
One trillion dollars is roughly the amount of earnings that American companies have in their foreign operations—and that they could repatriate to the United States. That money, in turn, could be invested in U.S. jobs, capital assets, research and development, and more.
But for U.S companies such repatriation of earnings carries a significant penalty: a federal tax of up to 35%. This means that U.S. companies can, without significant consequence, use their foreign earnings to invest in any country in the world—except here.
The U.S. government's treatment of repatriated foreign earnings stands in marked contrast to the tax practices of almost every major developed economy, including Germany, Japan, the United Kingdom, France, Spain, Italy, Russia, Australia and Canada, to name a few. Companies headquartered in any of these countries can repatriate foreign earnings to their home countries at a tax rate of 0%-2%. That's because those countries realize that choking off foreign capital from their economies is decidedly against their national interests.

Many commentators have pointed to the large cash balances sitting on U.S. corporate books as evidence that the economy is still stalled because companies aren't spending. That analysis misses the point. Large cash balances remain on U.S. corporate books because U.S. companies can't spend their foreign-held cash in the U.S. without incurring a prohibitive tax liability.

Especially with corporate bond rates falling below 4%, it's hard to imagine any responsible corporation repatriating foreign earnings at a combined federal and state tax rate approaching 40%.
By permitting companies to repatriate foreign earnings at a low tax rate—say, 5%—Congress and the president could create a privately funded stimulus of up to a trillion dollars. They could also raise up to $50 billion in federal tax revenue. That's money the economy would not otherwise receive.
The amount of corporate cash that would come flooding into the country could be larger than the entire federal stimulus package, and it could be used for creating jobs, investing in research, building plants, purchasing equipment, and other uses. It could also provide needed stability for the equity markets because companies would expand their activity in mergers and acquisitions, and would pay dividends or buy back stock. And when markets go up, confidence increases and businesses and consumers begin to spend.
The $50 billion boost in federal tax revenue, meanwhile, could be used to help put America back to work. For example, Congress could use it to give employers—large or small—a refundable tax credit for hiring previously unemployed workers (including recent graduates). The tax credit could equal up to 50% of a worker's first-year and second-year wages, capped at $12,500 per year (or $25,000 total per new hire).
Such a program could help put more than two million Americans back to work at no cost to the government or American taxpayers. How's that for a good idea?
Mr. Chambers is chairman and chief executive officer of Cisco Systems. Ms. Catz is president of Oracle Corporation.

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Go Dan Go -- States Shift to Hybrid Pensions

States Shift to Hybrid Pensions

Facing Shortfalls, Some Combine Guaranteed Plans With 401(k)-Like Options

By JEANNETTE NEUMANN

State governments, one of the last bastions of guaranteed pensions, are increasingly taking a page from the 401(k) plans that dominate the private sector.

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Ramin Rahimian for The Wall Street Journal

Utah state Sen. Dan Liljenquist pushed his state to move toward a pension plan more similar to those used in the private sector.

Some new state workers in Michigan and Utah will soon begin to receive part of their retirement benefits from a 401(k)-type plan, after lawmakers there recently voted to adopt plans that combine a 401(k) component with a guaranteed benefit.

These hybrid plans are a cost-cutting measure for states seeking to pare back the guaranteed-retirement payments considered a bedrock benefit for government workers. The new plans shift more responsibility for funding retirement benefits to employees and, some say, could make government jobs less attractive. In down markets, the plans could mean less-generous benefits for these workers, who have sidestepped the market volatility many of their private-sector counterparts endured in recent years.

Utah and Michigan join six other states that have some form of hybrid plans for public workers. Most of those states, including Oregon and Washington, created hybrid plans within the past 15 years.

A number of other states, facing looming pension-fund liabilities, have expressed interest in hybrid plans, industry participants say. Some officials in North Carolina and Pennsylvania, for instance, are contemplating a move to a hybrid plan.

"Reality is not negotiable," says Utah state Sen. Dan Liljenquist, a Republican who was instrumental in crafting the legislation for the state's pension changes. "The fact is somebody bears the risk. Ultimately, the state is bearing more risk than it can."

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Total unfunded public-pension liabilities in the U.S. increased to $457.8 billion in fiscal year 2008 from $368.5 billion in 2007, according to a June report by Standard & Poor's. States have taken various measures to bridge that funding gap, including scaling back cost-of-living adjustments, increasing monthly contributions from employees toward their pensions or extending the retirement age. Often the changes only affect new hires.

Governments trying to rein in pension costs hope these hybrid plans can represent a middle ground. Since they maintain a defined-benefit plan for workers, the hybrid plans can help lawmakers skirt the political backlash that could accompany any threat to a pension, while they move some of the investment risk to employees.

Though not a booming trend, "hybrids are being looked at now more than ever before," said Cathie Eitelberg, senior vice president and public-sector practice leader at the Segal Co., whose clients include government pension funds.

In Utah, most current employees are in a pension where the state in 2010 contributes 16% of an employee's monthly income. Workers do not contribute. Faced with rising contribution rates, lawmakers voted to have new workers as of July 1, 2011 choose to enroll in a defined-contribution plan—like a 401(k)—or a hybrid plan.

In the hybrid plan, workers can invest in a 401(k)-type fund. State and employee contributions to the defined-benefit portion of the hybrid plan fluctuate based on the financing of the pension fund. The state contribution is capped at 10% across both parts of the plan.

In Michigan, new school employees as of July 1 contribute 2% of monthly income to a 401(k)-type fund, with state employers matching up to 1% of pay. Employees are automatically enrolled in the fund but can choose to opt out or choose to contribute more.

There is still a defined-benefit component, but it will cost the state less: Public employers will contribute on average 2.5% of an employee's monthly income toward retirement, down from an average base of 4%. There is no longer a cost-of-living adjustment in retirement.

Retirement officials hope that most new employees will contribute to the 401(k)-type fund to try to maximize their retirement benefits by taking advantage of the employer match, said Phil Stoddard, director of Michigan's Office of Retirement Services.

"We hope to create a culture of savings" with the defined-contribution component, Mr. Stoddard said. The 401(k) component becomes portable, which he said can make the benefit plan attractive for younger workers who are unlikely to remain in one job for 30 years, Mr. Stoddard said.

Some workers aren't enthralled. "It's less benefit overall because of the variability of that 401(k) component," said Doug Pratt, director of communications for the Michigan Education Association, a union representing 130,000 school employees.

The reduced benefits mean "we're going to lose some good people" who will find the benefits package less attractive, he said. But a hybrid plan is "certainly a better alternative than ditching pensions all together."

The vast majority of public sector employees have a defined-benefit plan-79% in 2008, according to the Employee Benefit Research Institute, a nonprofit research institute in Washington. In comparison, 33% of private-sector employees were enrolled in a pension plan in the same period.

Eighteen percent of state workers had a defined-contribution plan in 2008, compared with 55% of private-sector workers enrolled in a defined-contribution plan.

The heightened interest in hybrid plans doesn't appear to foreshadow a swift change toward defined-contribution plans. Though defined-contribution plans are often on legislative agendas, they rarely have been adopted in the public sector, says Ron Snell, director of the state-services division for the National Conference of State Legislatures.

Only Alaska and the District of Columbia have mandatory defined-contribution plans for all workers, according to a June report by Mr. Snell.

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