Category Archives: Cato Institute

An open letter to President Obama (Part 16 of my response to State of Union Speech 1-24-12)

Congressman Rick Crawford State of the Union Response 2012

Uploaded by  on Jan 24, 2012

Rep. Rick Crawford responds to the State of the Union address January 24, 2012

 

President Obama’s state of the union speech Jan 24, 2012

Barack Obama  (Photo by Saul Loeb-Pool/Getty Images)

President Obama c/o The White House
1600 Pennsylvania Avenue NW
Washington, DC 20500

Dear Mr. President,

I know that you receive 20,000 letters a day and that you actually read 10 of them every day. I really do respect you for trying to get a pulse on what is going on out here.

The Heritage Foundation website (www.heritage.org ) has lots of good articles and one that caught my attention was concerning your State of Union Speech on January 24, 2012 and here is a short portion of that article:

Want to Bring Back Jobs? Avoid Overcriminalization – Joe Luppino-Esposito

President Obama claims that he wants to bring more manufacturing jobs back into the United States and wants to encourage small business and entrepreneurship by tearing down regulations.

He can start by avoiding the criminalization of American businesses by means of outrageous statutes such as the Lacey Act.  Just ask the workers at the Gibson Guitar plant in Tennessee, who were confronted by armed federal agents because of allegations that they imported wood from India that wasn’t properly finished with Indian labor.  That’s right: the administration is seeking to enforce protectionist labor laws for other countries. Thanks to the Lacey Act, violation of environmental regulations of a foreign nation becomes a federal crime.  Gibson’s CEO has come out swinging against the Lacey Act, but if the President meant what he said about protecting US jobs, then after tonight, he should find an ally in Obama, who can tell his Department of Justice to stop pursuing Gibson.

Entrepreneurs such as Abner Schoenwetter, would also like to get some relief from regulations: Honduran regulations, that is.  He too was found guilty under the Lacey Act because of using plastic bags instead of cardboard boxes to ship lobsters for his seafood importing business.  Schoenwetter spent five years in a U.S. federal prison for his regulatory errors.

So if Obama wants to encourage American jobs, he would do well to stop making it a crime to engage in business here.

______________________

My own business ran up against some regulations for some imports that we brought in and the delay was blamed on the Lacey Act. Reasonableness has gone out of the window it seems.

Thank you so much for your time. I know how valuable it is. I also appreciate the fine family that you have and your committment as a father and a husband.

Sincerely,

Everette Hatcher III, 13900 Cottontail Lane, Alexander, AR 72002, ph 501-920-5733, lowcostsqueegees@yahoo.com

Occupy Little Rock should change goals

On Tuesday I went to the downtown post office with a relative of mine. I noticed that the Occupy Little Rock tents were right next to the parking lot. I suggested that she lock the door while I was in the post office and she replied there was no way she was staying in the car!!! Before leaving the post office  I received a lot of change and the person commented, “You got so much change you can buy something to eat on the ride home.” I joked, “I just have to walk a few feet since I live in one of those tents over there.” Several people turned immediately to get a better look at me. Then I admitted that I was joking and we all had a laugh.

Max Brantley noted on the Arkansas Times Blog on 2-23-12:

Plans apparently are underway to begin an end of the all-night camps, though City Hall hasn’t yet revealed the specifics of its plan. To date, the city has been remarkably tolerant. The Occupy LR group has had remarkably long staying power, given its lack of a central, concrete mobilizing action agenda.

I also think the city of Little Rock has “been remarkably tolerant.” However, Brantley and I probably disagree on what should be the “mobilizing action agenda.”

I think their main emphasis should be in the Washington area and should be criticizing big government. Dan Mitchell of the Cato Institute has pointed out :

Bureaucrats are paid too much, getting twice as much compensation, on average, as people in the productive sector of the economy, and  lobbyists, contractors, and interest groups have figured out how to get lucrative positions at the federal trough.

A new report from MSN Money illustrates how the political elite is getting very rich by plundering honest Americans. America has 3,033 counties, and they identified the 15 richest jurisdictions from that list.

Of those 15 super-elite counties (the top 1/2 of one percent), 10 are in the Washington metropolitan area.

It is clear to me that outrage should be directed in this direction instead of the private market. Below is the complete article by Dan Mitchell:

Based on Where the Top 1 Percent Lives, the Occupy Crowd Should Be Protesting Against Big Government

Posted by Daniel J. Mitchell

I’ve written before about how big government is enriching people in the Washington metropolitan area. This is for two reasons.

First, bureaucrats are paid too much, getting twice as much compensation, on average, as people in the productive sector of the economy.

Second, lobbyists, contractors, and interest groups have figured out how to get lucrative positions at the federal trough.

A new report from MSN Money illustrates how the political elite is getting very rich by plundering honest Americans. America has 3,033 counties, and they identified the 15 richest jurisdictions from that list.

Of those 15 super-elite counties (the top 1/2 of one percent), 10 are in the Washington metropolitan area. I’ve identified them with stars in the map.

You may be wondering, by the way, about the location of the other counties in the top 15. Well, four of them are suburbs of New York City, meaning that they are home to rich Wall Street people who mooched from the taxpayers thanks to TARP bailouts and other subsidies.

So if you really want to be cynical, you could count them as auxiliary counties of Washington, DC. That’s probably an unfair conclusion, but TARP was unfair to honest and hard-working people, so I don’t feel too guilty.

As far as I can tell, the only untarnished jurisdiction in the top 15 is Douglas County, Colorado. And given that these are the folks who are implementing a good school choice plan, it seems that we have a group of productive people who also believe in doing the right thing.

For more information about the overcompensation of bureaucrats, this video is loaded with information.

There Are too Many Bureaucrats and They Are Paid too Much

Uploaded by on Jun 1, 2010

America has too many bureaucrats and they are dramatically overpaid. This mini-documentary uses government data to show how federal, state, and local governments are in fiscal trouble in part because of excessive pay for a bloated civil service.

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Most important of all, remember that any proposals to increase government spending will further widen the income gulf between the political elite and regular Americans. And any initiative to boost the tax burden would lead to the same result.

Obama has taken us past most bankrupt European countries already

Over the last 20 or 30 years I have heard conservatives say that it is  a real shame that we are headed towards a bankrupt European liberal socialist kind of state. However, we are now there.

We’re Already Europe

by Michael D. Tanner

Michael Tanner is a senior fellow at the Cato Institute and author of Leviathan on the Right: How Big-Government Conservatism Brought Down the Republican Revolution.

Added to cato.org on February 22, 2012

This article appeared in National Review (Online) on February 22, 2012.

With seemingly every day bringing more bad news from Europe, many are beginning to ask how much longer the United States has before our welfare state follows the European model into bankruptcy. The bad news is: It may already have.

This year, the fourth straight year that we borrowed more than $1 trillion to support the U.S. government, our budget deficit will top $1.3 trillion, 8.7 percent of our GDP. If you think that sounds bad, it’s because it is. In fact, only two European countries, Greece and Ireland, have larger budget deficits as a percentage of GDP. Things are only slightly better when you look at the size of our national debt, which now exceeds $15.3 trillion, 102 percent of GDP. Just four European countries have larger national debts than we do — Greece and Ireland again, plus Portugal and Italy. That means the U.S. government is actually less fiscally responsible than countries like France, Belgium, or Spain.

And as bad as things are right now, we are on an even worse course for the future. If one adds the unfunded liabilities of Social Security and Medicare to our official national debt, we really owe $72 trillion, by the Obama administration’s projections for future Medicare savings under Obamacare, and as much as $137 trillion if you use more realistic projections. Under the best-case scenario, then, this amounts to more than 480 percent of GDP. And, under more realistic projections, we owe an astounding 911 percent of GDP.

At that point does the United States cease being the United States as we have known it?

Meanwhile, counting both official debt and unfunded pension and health-care liabilities, the most indebted nation in Europe is Greece, which owes 875 percent of GDP. That’s right, the United States potentially owes more than Greece. France, the second most insolvent nation in Europe, owes just 549 percent of GDP. Even under the most optimistic scenario, we owe more than such fiscal basket cases as Ireland, Italy, Portugal, and Spain.

So far we have been able to avoid the consequences of our profligate ways because the very public turmoil in Europe has helped prop us up as the world’s safe haven for foreign investment. Compared to the euro’s problems, the dollar looks pretty safe. This means that others are still willing to lend us money at absurdly low rates. But that won’t last forever. In fact, already seven European countries, including Germany and Sweden, have better credit ratings than the U.S.

Perhaps we can take some solace in the fact that our welfare state is not yet as big as Europe’s. But the key word here is “yet.” Today, our federal government spends more than 24 percent of GDP. Throw in state and local spending, and government at all levels consumes over 43 percent of everything produced in this country over the course of a year. As bad as that is, it’s still less than Europe, where the average of government spending at all levels is slightly more than 50 percent of GDP. But the Congressional Budget Office projects that federal-government spending in this country is currently on a path to exceed 42 percent of GDP by 2050. Government spending at all levels will exceed 59 percent of GDP. And CBO assumes state and local spending will decline in the future, which seems unlikely.

By way of comparison, today, Ireland is the only country in Europe with a bigger government than the U.S.’s will be in 2050. That’s right, one can look at countries like France and Greece, or even Denmark and Sweden, and realize that we will eventually have bigger governments than those quintessential welfare states have today.

At that point does the United States cease being the United States as we have known it? At the very least, can our economy survive such a crushing burden of government spending, and its attendant level of taxes and debt?

Given this looming disaster, President Obama has just submitted a budget that explicitly rejects “austerity,” avoids any reform of Medicare or Social Security, and adds some $7 trillion to the national debt over the next ten years….

Minimum wage could be eliminating jobs

Minimum wage could be eliminating jobs

Liberals just don’t have a clue.

The Job-Killing Impact of Minimum Wage Laws

Uploaded by  on Jun 14, 2010

Minimum wage laws seem like a good idea, but arbitrarily mandating a certain wage can have terrible consequences. This CF&P Foundation mini-documentary reveals that business are not charities, so if the minimum wage is set above the market level, this eliminates job opportunities — particularly for the less fortunate members of society. Since employees and employers should have freedom of contract, the right minimum wage is zero. www.freedomandprosperity.org

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Minimum Wage Hikes Deserve Share of Blame for High Unemployment

Posted by Daniel J. Mitchell

Even though the Obama Administration claimed that squandering $800 billion on so-called stimulus would  keep the joblessness rate below 8 percent, the unemployment rate today is almost 10 percent. There are many reasons for the economy’s tepid performance, including a larger burden of government spendingand the dampening effect of future tax rate increases (tax rates will jump significantly on January 1, 2011, when the 2003 tax cuts expire).

A closer look at the unemployment data, though , suggests that minimum wage laws also deserve a big share of the blame. In this Center for Freedom and Prosperity video, a former intern of mine (continuing a great tradition) explains that politicians destroyed jobs when they increased the minimum wage by more than 40 percent over a three-year period.

Mr. Divounguy is correct when he says businesses are not charities and that they only create jobs when they think a worker will generate net revenue. Higher minimum wages, needless to say, are especially destructive for people with poor work skills and limited work experience. This is why young people and minorities tend to suffer most – which is exactly what we see in the government data, with the teenage unemployment rates now at an astounding (and depressing) 26 percent level and blacks suffering from a joblessness rate of more than 15 percent.

In a free society, there should be no minimum wage law. From a philosophical perspective, such requirements interfere with the freedom of contract. In the imperfect world of politics, thought, the best we can hope for is that politicians occasionally do the right thing. Sadly, the recent minimum wage increases that have done so much damage were signed into law by President Bush. It’s worth noting that President Obama’s hands also are dirty on this issue, since he supported the job-killing measure when it passed the Senate in 2007. When the stupid party and the evil party both agree on a certain policy, that’s known as bipartisanship. In the real world, however, it’s called unemployment.

Private companies need private capital to succeed, not federal handouts

It seems to me that during the 1980’s we saw the largest growth of our economy because private industry was encouraged to expand because the top tax rate went down from 70 to almost half of that.

It reminded me of the 1960’s when the top income rate went from 91 to almost half of that and the same thing happened. We need to get back to the same atmosphere of taxing cutting and the expansion of private industry. Instead we have today the government offering handouts everywhere we look. Here is a case that makes this very point below:

Franken to Chu: Doggone It, Like My State’s Company

Posted by Tad DeHaven

The Senate Energy and Natural Resources Committee held a hearing last week on the Department of Energy’s budget request for fiscal 2013. Chris Edwards tipped me off to a particularly galling exchange between Energy secretary Steven Chu and Sen. Al Franken (D-MN). Sen. Franken uses his allotted time to badger Chu about a federal loan that Energy conditionally committed to a Minnesota company in 2010 that apparently has yet to be approved.

The exchange begins around the 61 minute mark here. Our trusty interns, Devon Sanchez and Stephen Wooten, transcribed the exchange, which I’ll share a portion of:

Sen. Franken:

One such project is from a company in Minnesota called SAGE Electrochromics. I know you are aware of that. Sage has developed energy efficient windows that are cutting edge, better than anything in the world and uses photo-voltaic cells to control the window how dark it gets during the summer to block out UV light and lower air conditioning costs and to let it all in, lower heating costs in the summer. And it’s really…I’ve been there and it’s just an amazing tech. In the Spring of 2010, the DoE promised the company it would receive a $72 million loan guarantee under the 1703 Program to build a new manufacturing facility that would create 160 manufacturing jobs and 200 construction jobs in southern Minnesota. It’s now been two years since SAGE has been notified that it will receive a loan guarantee and the deal has not yet been closed. While the Department of Energy prolongs closing the deal, time and money are running out for SAGE. There are high-tech manufacturing construction jobs at stake here. It’s been going forward with the project assuming they get this loan guarantee but they’re running out of time and they may have to sell themselves to a French company. My first question is that the SAGE loan guarantee was going to be submitted to the credit committee on August 23rd, but it was stopped. Why is the Department of Energy continuing to delay closing and executing the SAGE loan guarantee?

Secretary Chu tells Sen. Franken that he can’t discuss the details and advises the senator to speak with SAGE. A frustrated Sen. Franken takes another crack at getting Chu to explain the holdup, but doesn’t get anywhere and his speaking time runs out. Anyhow, the exchange is sad commentary on the state of affairs in Washington. Sen. Franken sitting there singing the virtues of handing out other people’s money to commercial interests in general would have been problem enough. That he instead used his time to grovel for a handout to a company in his state just goes to show that too many policymakers see the federal government as a favor dispenser.

If this company is producing such “amazing tech,” then perhaps Sen. Franken should lend SAGE some of his money? (Maybe he could use the royalties he receives from DVD sales of “Stuart Saves His Family” to help the company.) Wisecracks aside, a quick Google search shows that SAGE has already received private capital. If this company is so great then it should have no trouble finding additional investors to lend it the money it needs. Then again, Franken says that it’s running out of money so perhaps it isn’t so great. But that’s the way Washington works: taxpayers get the losses while private companies get the profits…and arrogant senators get to pat themselves on the back for “creating jobs.”

See here for more on downsizing the Department of Energy.

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Medicaid costs can be contained

We got to take the bull by the horns eventually.

Block-Granting Medicaid Is a Long-Overdue Way of Restoring Federalism and Promoting Good Fiscal Policy

Posted by Daniel J. Mitchell

This new video, based in large part on the good work of Michael Cannon, explains why Medicaid should be shifted to the states. As I note in the title of this post, it’s good federalism policy and good fiscal policy. But the video also explains that Medicaid reform is good health policy since it creates an opportunity to deal with the third-party payer problem.

_________

One of the key observations of the video is that Medicaid block grants would replicate the success of welfare reform. Getting rid of the federal welfare entitlement in the 1990s and shifting the program to the states was a very successful policy, saving billions of dollars for taxpayers and significantly reducing poverty. There is every reason to think ending the Medicaid entitlement will have similar positive results.

Medicaid block grants were included in Congressman Ryan’s budget, so this reform is definitely part of the current fiscal debate. Unfortunately, the Senate apparently is not going to produce any budget, and the White House also has expressed opposition. On the left, reducing dependency is sometimes seen as a bad thing, even though poor people are the biggest victims of big government.

It’s wroth noting that Medicaid reform and Medicare reform often are lumped together, but they are separate policies. Instead of block grants, Medicare reform is based on something akin to vouchers, sort of like the health system available for Members of Congress. This video from last month explains the details.

In closing, I suppose it would be worth mentioning that there are two alternatives to Medicaid and Medicare reform. The first alternative is to do nothing and allow America to become another Greece. The second alternative is to impose bureaucratic restrictions on access to health care—what is colloquially known as the death panel approach. Neither option seems terribly attractive compared to the pro-market reforms discussed above.

Obama’s budget cuts are not meaningful

If you wanted to get serious about budget cuts then why not eliminate the Dept of Education. These budget cuts mentioned below in the budget are just peanuts. We should have meaningful budget cuts that would BALANCE THE BUDGET.

Obama’s Proposed Cuts and the Scope of Government

Posted by Tad DeHaven

The president’s fiscal 2013 budget includes a 213 page document that contains 210 proposed cuts, consolidations, and other savings. That sounds like a lot until one finds out that the alleged savings would only amount to $24 billion in a $3.8 trillion budget. Not only would the cuts do little to reduce the size of government, they would do nothing to reign in the scope of government.

The following are a few examples of what I’m talking about:

  • The administration proposes to eliminate the Environmental Protection Agency’s Clean Automotive Technology program for savings of $16 million. However, the proposed cut doesn’t reflect a sudden desire to end federal “green” subsidies to car manufacturers. Instead, the administration says “other Federal programs are better positioned to research, develop, demonstrate, and deploy a broad suite of advanced vehicle technologies.”
  • The administration proposes to cut funding for the Department of Health and Human Service’s Community Services Block Grant program from $679 million to $350 million. The administration cites reports from the HHS inspector general and the Government Accountability Office that “have documented failures in program oversight and accountability.” However, instead of proposing to completely terminate it, the administration says it’s going to fix the program and basically apologizes for having to cut it to meet discretionary spending caps.
  • The administration proposes to cut funding by $226 million for fossil fuel subsidies administered by the Department of Energy. These subsidies should be eliminated. But they should be eliminated along with all energy subsidies because the federal government should stop trying to pick winners and losers in the energy market. Unfortunately, it appears that the administration is really only interested in scoring political points with the “green” crowd.
  • The administration proposes to save a whopping $3 million by terminating the U.S. Department of Agriculture’s public broadcasting grant program. The administration correctly points out that the program is duplicative of the Corporation for Public Broadcasting. However, the CPB would get another $1 million in funding for an overall budget of $445 million. In other words, the proposed cut would have practically no effect on the federal government’s subsidization of PBS and NPR.

I could go on and on with examples but there’s no point. A glass-half-full type might say, “Well, at least the administration is proposing to cut something.” Unfortunately, the glass is nowhere close to being half full – it’s empty. The administration’s relatively paltry savings would still leave the budget with a projected deficit of $901 billion for fiscal 2013. And the deficit would only be smaller than last year because the government is projected to take in more revenue – not because the government would spend less. Worse, the federal government under this budget would continue to be an intrusive, metastasizing cancer on individual liberty and the economy.

Tad DeHaven • February 14, 2012 @ 4:50 pm
Filed under: Government and Politics; Tax and Budget Policy

On Bloomberg, Sessions Discusses Astounding Gimmicks In President’s Budget

Uploaded by on Feb 13, 2012

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An open letter to President Obama (Part 15 of my response to State of Union Speech 1-24-12)

Sen. Paul Delivers State of the Union Response – Jan. 24, 2012

Uploaded by  on Jan 24, 2012

Sen. Rand Paul delivered the following Republican response to President Barack Obama’s State of the Union Address this evening

President Obama’s state of the union speech Jan 24, 2012

Barack Obama  (Photo by Saul Loeb-Pool/Getty Images)

President Obama c/o The White House
1600 Pennsylvania Avenue NW
Washington, DC 20500

Dear Mr. President,

I know that you receive 20,000 letters a day and that you actually read 10 of them every day. I really do respect you for trying to get a pulse on what is going on out here.

The Heritage Foundation website (www.heritage.org ) has lots of good articles and one that caught my attention was concerning your State of Union Speech on January 24, 2012 and here is a short portion of that article:

AWOL on  Nuclear Deterrence – James Carafano

Apparently, what the White House is doing on nuclear weapons—decisions that could affect the life and death on mankind—don’t rate a mention in the State of the Union. That is unbelievable considering the president is promoting the most sweeping changes in the American nuclear deterrent in the last 60 years.

Doggedly pursuing his “Road to Zero,” President Obama is vitiating the U.S. nuclear deterrent force.  If he gets his way, America will have a significantly smaller nuclear arsenal and atrophied delivery systems (air, land and sea). We will also never build a new nuclear weapon or construct missile defenses adequate to protect us from the global ballistic missile threat. The White House signaled as much the Pentagon’s “strategic guidance” which announced the president is not nearly done cutting America’s nuclear forces. Per the guidance: “It is possible that our deterrence goals can be achieved with a smaller nuclear force, which would reduce the number of nuclear weapons in our inventory, as well as their role in U.S. national security strategy.”

That the president should make such sweeping decision to gut nuclear forces at the same time he is gutting our conventional forces should have at least rated a mention in an address to the nation.

Thank you so much for your time. I know how valuable it is. I also appreciate the fine family that you have and your committment as a father and a husband.

Sincerely,

Everette Hatcher III, 13900 Cottontail Lane, Alexander, AR 72002, ph 501-920-5733, lowcostsqueegees@yahoo.com

An open letter to President Obama (Part 14 of my response to State of Union Speech 1-24-12)

Leader Cantor On CNN Responding To President Obama’s State of the Union Address

Uploaded by  on Jan 25, 2012

President Obama’s state of the union speech Jan 24, 2012

Barack Obama  (Photo by Saul Loeb-Pool/Getty Images)

President Obama c/o The White House
1600 Pennsylvania Avenue NW
Washington, DC 20500

Dear Mr. President,

I know that you receive 20,000 letters a day and that you actually read 10 of them every day. I really do respect you for trying to get a pulse on what is going on out here.

The Heritage Foundation website (www.heritage.org ) has lots of good articles and one that caught my attention was concerning your State of Union Speech on January 24, 2012 and here is a short portion of that article:

Obama Education End-run Around Congress – Lindsey Burke

President Obama’s call to reward excellent teachers and raise standards sounds great, but his administration has been orchestrating and end-run around Congress, which will ultimately limit the power of states and local leaders to implement policies that will achieve these goals. The president might not like the fact that conservatives in Congress are engaging in a thoughtful process to save states from the bureaucratic nightmare that is No Child Left Behind, but his solution – granting waivers from the White House and imposing his preferred education policy from the White House – will only bind the hands of state leaders down the road by giving more power to the Department of Education.

President Obama is pushing states to adopt national standards and test, putting Washington in control of what is taught in every public school across America. By contrast, conservatives in Congress have offered several proposals, including proposals by the House Education and the Workforce Committee to provide more flexibility from No Child Left Behind to states and local leaders to determine how education dollars are spent. There are also alternatives like the A-PLUS proposal, that would allow states to completely opt-out of No Child Left Behind, and provide genuine relief.

Not Rewarding Jobs Outsourcing, But Punishing Companies for Trying to Compete – J.D. Foster

President Obama says we shouldn’t have a tax code that rewards companies for moving jobs overseas.  He’s right, and we don’t.  In fact, we have one of the most punitive tax systems in the industrialized world for taxing the income companies make abroad.

In fact, only a few years ago, about half the industrialized countries in the world had a system about as punitive as our own.  Today, almost every one of those countries have joined the ranks of competitive nations and adopted a simpler, more pro-growth, less protectionist system called Territoriality.  Increasingly, American tax policy makers have recognized the U.S. needs to follow suit and adopt a territorial system of our own for taxing U.S. companies operating abroad.  Not to reward them for moving jobs overseas, but to avoid penalizing them for trying to compete in global markets.

President Obama wants to go in the other direction.  He wants to punish U.S. companies who try to compete abroad.  When U.S. companies compete abroad, they make their entire enterprises more competitive, including their U.S. operations.  What President Obama proposes appears and sounds like a policy to advance U.S. jobs and U.S. prosperity is, in fact, just the opposite.

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You are looking for places to cut in the government and I can not think of a better place than eliminating the Dept of Education. This needs to be returned to the states.

Thank you so much for your time. I know how valuable it is. I also appreciate the fine family that you have and your committment as a father and a husband.

Sincerely,

Everette Hatcher III, 13900 Cottontail Lane, Alexander, AR 72002, ph 501-920-5733, lowcostsqueegees@yahoo.com