History affords us many instances of the ruin of states,
by the prosecution of measures ill suited to the temper and genius of their people.
The ordaining of laws in favor of one part of the nation,
to the prejudice and oppression of another,
is certainly the most erroneous and mistaken policy.
An equal dispensation of protection, rights, privileges, and advantages,
is what every part is entitled to, and ought to enjoy...
These measures never fail to create great and violent jealousies and animosities
between the people favored and the people oppressed;
whence a total separation of affections, interests, political obligations,
and all manner of connections,
by which the whole state is weakened.
Benjamin Franklin
Political Quote of the Day
"If the present Congress errs in too much talking, how can it be otherwise in a body to which the people send one hundred and fifty lawyers, whose trade it is to question everything, yield nothing, and talk by the hour?" - Thomas Jefferson
[It's good to know that Barack Obama hasn't forgotten where he came from...the US Senate.]
In the 111th Congress, lawyers compromised the largest background profession plurality in the Congress (and a simple majority in the Senate); businessmen held the largest plurality in the House.
Former Presidents, also a lawyer, include: John Adams, Jefferson, Madison, Monroe, John Quincy Adams, Van Buren, Tyler, Polk, Fillmore, Pierce, Buchanan, Lincoln, Hayes, Arthur, Cleveland, Harrison, McKinley, Taft, Wilson, Coolidge, FDR, Nixon, Ford, and Clinton.
Over half the Presidents. None of whom have produced a single widget for the American economy; they have been an economic burden, not a catalyst for economic growth. Isn't it time for a change?
Jackass of the Month:
Pennsylvania State Rep. Bill DeWeese
If Reason can issue its Nanny of the Month, I can, at least on an infrequent basis, publish a Jackass of the Month.
Former Pennsylvania House Speaker DeWeese is a recently convicted felon, with five counts of corruption by a jury of his peers of using up to $100K of state resources for political purposes. He's running unopposed for an 18th term in office (he's still eligible because he won't be sentenced until around the upcoming primary date); he's confident that he'll win reversal of his conviction by the time of the fall election.
DeWeese is especially proud of bringing home the bacon to the district in the form of two state prisons. (I guess his district doesn't get its fair share of criminals, so they have to import them from the rest of the state.) It isn't often a politician gets to eat his own dog food; DeWeese after his sentence will be serving his time for the State of Pennsylvania in a different capacity...
DeWeese is automatically added to the list of my nominations for the 2012 Jackass of the Year, joining my previously announced candidacies of Martha Johnson and Hilary Rosen.
A Message To My Fellow Catholics For This Fall
The Wonderful World of Obama
I've decided to start a recurring feature dedicated to miscellaneous odd items from the Obama White House.
- VP Biden Describes Al Franken As a 'Leading Legal Scholar'. Well, there he goes again. Yes, the junior US Senator from Minnesota whom doesn't possess a law degree, never mind passed the bar. I guess I can understand Biden's confusion. Franken, while presiding over the Senate during floor speeches for SCOTUS Justice Kagan's confirmation, "gesticulated and made faces while McConnell explained his opposition to Kagan". It's behavior we've come to expect from judges, not those stereotypical images of stoic judges in their powdered wigs demanding decorum in their courtroom. No doubt Biden is hoping Franken will put in a good word for him with the comedy clubs after Biden loses the election this fall and starts a new career as a stand-up comic.
- Dozen Secret Service Agents Recalled From Colombia Over Prostitution Charges. The Colombian police (and then the US government) got tipped off after an agent's private part got stiff, but the prostitute got stiffed. (It probably didn't help when the agent kept singing the same Beatles song to her:)
- Time for an Obama Rule: Obama Pays a Lower Effective Tax Rate Than His Secretary.
This observation from the Boston Herald on Obama's demagogic "Buffett Rule" gimmick is particularly notable:
"Obama now admits — he didn’t used to — the rule would be a “gimmick” in terms of deficit reduction. The Joint Committee on Taxation estimates the rule would raise $47 billion over 10 years, 0.1 percent of expenditures projected in Obama’s proposed budget and 0.5 percent of the projected increase in the national debt. Anybody who hasn’t detected spontaneous anger over the complexity of the tax code (requiring 73,608 pages in the CCH Standard Federal Tax Reporter) hasn’t paid attention. A proposal from Obama for a real tax simplification would be an advance; the Buffett Rule is old-fashioned demagoguery."
Fox News reports that the picture is even worse than that: Democrats want to use that income to offset alternate minimum tax reform, suggesting the net effect will add to the deficit.
Just a reminder: Hoover increased the top rate to 63%; FDR increased it to 79% by his second term and as high as 94% by his death during WWII; it briefly dipped to 82% as the GOP briefly won control of the House post-WWII before stabilizing at 91% until 1964 when the JFK tax took effect, bringing it back down to 70%, where it stayed until the Reagan tax cuts of the 1980's. Now, keep in mind with all this progressive nonsense focusing on rates versus dollars, the progressives aren't talking about a flat rate, which means if you earn twice as much, you pay twice as much in taxes; progressives think they deserve more and more of your money to spend with each and every new dollar you earn--to the absurdity in the 50's and early 60's, you were signing your paycheck off to the US government and got a not-so-great pocket change allowance in return. Think in terms of buying something, say, at WalMart. Suppose they flipped their selling policy: for the first 3 widgets, you pay $5; for widgets 4-6, you pay an additional $5 per widget, and so on. Under what circumstance would you buy 6 widgets? What I would do is say, okay, I'll buy 3 widgets now, and I'll make a future shopping trip to buy the remaining widgets at the lower price. There are a number of strategies I can use to minimize realizing taxable income: I can defer income to my lower-earning retirement years, I can redistribute asset mixes among my taxable and retirement accounts.
As de Rugy points out below, more than doubling the tax for the highest income earners under Hoover/FDR actually shrank the relative aggregate tax burden of those earners because of tax avoidance behavior. (If they truly understood economics, they would have increased the incentive for the economically successful to increase their investments in the economy, which would have promoted growth and a correlated increase in employment.) Oh, and by the way, did FDR balance the budget with his anti-growth tax increases? Of course not. Not only did unemployment skyrocket with tax increases on the wealthy, revenues did not go up as much as forecast, and the deficit, instead of contracting, actually increased, because spending increases exceeded incremental government revenues.
We've always known progressives like Obama have co-opted the language of fiscal conservatives: Obama railed against debt ceiling increases--when he was in the Senate minority; Obama talked about having the federal deficit--and has run up an unprecedented $1 trillion deficit every year in office, without a single concrete, material step for lowering current spending. If you think we've been there, done that, you're right. FDR played the same sham bait-and-switch argument in running against Hoover in 1932. Obama has been little more than an FDR wannabe and not a very good one at that--the same failed Keynesian "solutions". The biggest difference? FDR at least made a more even-handed attempt to share the tax burden across income levels; Obama tries to co-opt the language of "responsibility"--which amount to be sophistic rhetoric for "soak the rich". We "can't afford" to maintain current progressive tax rates for the wealthy whom already pay a disproportionate amount of tax burden; the quarter portion of the Bush cuts is needed "for deficits"--but not the three-quarters going to lower-income workers?
The British have had recent experience with this as the previously ruling Labor Party had passed exactly the same type of ideological progressive tax increase that the American "progressives" have been frequently banging their heads on the wall to reestablish since the initial Bush tax cuts (I don't know how PM David Cameron puts up with Clegg's/Liberal Democrats' populist class-envy nonsense: these busybodies even demagogue Mitt Romney's tax rate (which reflects mostly investment income, not salaried).):
[This obsessive Politics of Envy is difficult to comprehend; leftists seem to think they have the "right" to pick your pocket--for obscenely ineffective, inefficient, morally hazardous, dysfunctional public programs. They are shameless--instead of fixing a leaky bucket, they demand you disproportionately fund bigger, leakier buckets! Here's an economics lesson: when the economically success invest and gain, they also bring along others in a win-win situation: they win--and so do their employees, their vendors, their customers and the government Treasury. When you kill the goose that lays the golden egg, you no longer get golden eggs. I have mentioned this point in the blog countless times: in the US you could spend all the wealth of all the billionaires, it only pays for a fraction of an annual trillion dollar deficit by Obama--and he's on his way to his fourth straight. What do you do then? It's not like a $40B fortune is made every day.
What's particularly insulting is that progressives, those judgmental creatures who think they are morally self-superior, are relative tightwads when it comes to real charity--they're all for charity when it's the government picking the other guy's pocket. The "change Obama believes in"? I guess it's the pocket change that Joe Biden puts into the collection bucket every Sunday. MJ Perry of Carpe Diem has a current post out showing that whereas Biden has earned at least $200K a year since 1998, he paid under ONE-TENTH of the average charitable donation amount for his adjusted income level until he ran for higher office, where it would get more scrutiny--and even now, when he publicly publishes these data, he is giving under 60% of the AVERAGE amount for his income level! It amounts to just under 1.5% of his income (note: Biden is married and his wife's income is included to these numbers.) IN CONTRAST, the much-criticized Mitt Romney is required to tithe by his Mormon Church: he has contributed over $4M over the past two years (versus Biden's just under $11K).]
A preliminary study conducted by HM Revenue & Customs for the Treasury, due to be published next week [March 2012], is expected to show that the 50p rate – introduced by Labour in 2010-11 for those earning more than £150,000 a year – is bringing in hundreds of millions, rather than billions, of pounds. An earlier Treasury study assumed it would raise £2.6bn. Before 2010, the top rate had been at 40p since 1988. A government source said: "We want a top rate that does not put off entrepreneurs or businesses. It is one of the highest top rates worldwide at a time when we need real growth. Above all, real growth is what we need to promote wealth and prosperity."
 |
| Courtesy of de Rugy/CATO Institute |
So I hereby propose, in contrast to the Buffett Rule, the Obama Rule: I propose that the 47% of workers who do NOT currently pay any federal income tax be required to pay the current tax rate applicable to investment income; I also propose that all registered Democrats be required to pay their hero FDR's top income tax bracket rate of 94% as a down payment for paying off the excessive unpaid-for expenses and unfunded liabilities for their spendthrift New Deal, Great Society and other costly, grossly inefficient legacy programs.Daniel Hannan, "Memo to the Occupy protesters":
Thumbs UP!
Ask any American conservative whom is their favorite British politician, and chances are, like me, they'll say Daniel Hannan. (Especially after PM David Cameron acted like a gushing Obama-Maniac during his recent visit.) I know this article was written a few months ago, but I thought his wording, especially of his first few points, was particularly spot on:
1. Free-marketeers resent the bank bailouts. This might seem obvious: we are, after all, opposed to state subsidies and nationalisations. Yet it often surprises commentators, who mistake our support for open competition and free trade for a belief in plutocracy. There is a world of difference between being pro-market and being pro-business. Sometimes, the two positions happen to coincide; often they don’t..With regards to the first point, I was somewhat imprecise in earlier posts, sometimes calling myself "pro-business". What I meant was clear in context: I was referring to a nurturing environment for economic growth, e.g., a small government footprint, free trade, competitive tax rates, a more stable economic environment, etc. But it's clear, especially in more libertarian contexts, that pro-business is seen as a synonym for Big Business--in a crony relationship with Big Government. I have ALWAYS been pro-free market, and I have repeatedly stated exactly what Hannan says here: we don't have a problem with businesses failing if and when top managers do not respond to the changing competitive environment or otherwise make bad, imprudent business decisions.
2. What has happened since 2008 is not capitalism. In a capitalist system, bad banks would have been allowed to fail, their profitable operations bought by more efficient competitors. Shareholders, bondholders and some depositors would have lost money, but taxpayers would not have contributed a penny.
3. If you want the rich to pay more, create a flatter and simpler tax system. This is partly a question of closing loopholes...Mainly, though, it is a question of bringing the tax rate down to a level where evasion becomes pointless. In Britain, since the top rate of income tax was lowered to 40 per cent in 1988, the share of income tax collected from the wealthiest percentile has risen from 14 to 27 per cent.
4. Those of us who believe in small government are not motivated by the desire to make the rich richer. We’re really not. We are, in most cases, nowhere near having to pay top rate tax ourselves; our most eloquent champions over the years have been modestly-paid academics. We believe that economic freedom will enrich the country as a whole. Yes, the wealthy might become wealthier still, but we don't see that as an argument against raising living standards for the majority.
Where I think I differ from Hannan here, at least in his presentation, is that there are two sides of a crony relationship; I think there were issues of reactive vs. proactive regulation, overly complex and overlapping regulation, incompetent and ineffective regulators, morally hazardous, overextended and improperly priced government guarantees. I think government has been part of the problem, and if we don't effectively acknowledge and reform the obvious failures in public policy, all we've done since the economic tsunami is add another layer of complexity to the system, treating the symptoms instead of the disease. The Occupy movement has tended to identify with failed progressive politicians and tried to scapegoat the free enterprise system. I am not denying that some businesses made bad decisions when the future of the business was at stake.
I particularly like the way Hannan phrased his fourth point. I have never made enough money to qualify for the top tax brackets. I don't own a house or a fancy car; I've rarely eaten at upscale restaurants, and I can only recall one time I've ever flown above coach (on my first trip to Brazil, I rode business class on the way down). I don't mind if someone builds and benefits from a successful business: I see a rising tide as lifting all boats.
The big difference between the pro-liberty Tea Party and the Occupy movement (from the perspective of style vs. ideology and the fact that our movement was based on a truly spontaneous rebellion against audacious Big Government versus a contrived movement of self-entitled whiners) is that we libertarian-conservatives do not feel the need to finger-point or otherwise make excuses; we pay our own bills, don't think we'll entitled to special privileges on public property, talk about doing substantive reform (instead of gimmick politics, polarizing, divisive rhetoric and vacuous sound bites and slogans) and living within our national means, and are worried about current politicians leaving behind an unsustainable debt burden for future generations to pay off. We don't demonize the left: we just know that they don't understand the economy and the virtuous free market.
Musical Interlude: My Favorite Groups
Doobie Brothers, "The Doctor". This concludes my retrospective on the Doobie Brothers. My next series, starting with the next post, will focus on the Rolling Stones.
