Accept responsibility for your life.
Know that it is you who will get you where you want to go,
no one else.
Les Brown
Going Beyond Big Bird and Serrano
The chief takeaway in my judgment even a quasi-privatization (through tax expenditures, i.e., tax-deductible charitable donations) is better than government meddling in the sector. Actually, I'm not a fan of bribing donors through the tax code. Essentially the government is indirectly funding charitable donations. In a free market we do charitable acts for intrinsic purposes.
Follow-Up Odds and Ends
- Intrade Shuts Its Window to US Bettors. I had seen Mark Perry mention Intrade in his Carpe Diem posts, and I subsequently regularly referenced related bets on political races in my Political Potpourri segments leading up to the election (in retrospect most of those winning bets were spot on.) The Irish-based parent to Intrade (which makes its money on transaction fees) did previously petition for CFTC oversight at least as early as 2008. There are concerns about manipulation, e;.g., a political operative makes material purchases or sales of candidate bets to create the impression something has changed in election momentum, (You can think of a predictive bet as a type of option. Intrade believes that CFTC approval would actually improve liquidity.) Intrade on its website insists, despite the Monday announcement, the rumors of the end of its US business are greatly exaggerated, that it will soon introduce an exchange that will pass regulator concerns.
- Miscellany: 11/27/12: Glenn "Serrano" Beck; Ebay halts Glenn Beck's charity auction of 'Obama in Pee Pee' on the grounds he was selling urine. (Actually the 'urine' is beer,) The auction was up to $11,300 at the point the auction was interrupted. Beck is receiving bids at his own website--along with selling commemorative $20 t shirts
- One-off Post Over the Holiday Weekend. I published a Christmas-related essay under an ironic title. If you read the essay, you will find I have a sympathetic viewpoint but I don't believe in moral indictments. I have a fairly novel approach to gift-giving as like solving a problem; I often try to surprise the recipient. I don't like to be predictable but my gifts are based on knowledge of the person with an element of surprise. Just to give an example I don't put in the essay: I don't buy my mom something predictable like flowers or her favorite perfume. But I once gave my mom a present on my own birthday, which she never saw coming.
Before There Was Simpson-Bowles,
There Was Kerrey-Danforth
You would think after two failed Democrat Presidents whom named bipartisan commissions to look at the cown jewels of Democrats' social liberal crown jewels, the New Deal's social security program and the Great Society's Medicare program, you would hope one of them would have had the testicular fortitude to exercise leadership and not simply hire an All-Pro punter.
Two GOP Congressmen on the Clinton Bipartisan Commission On Entitlement And Tax Reform, Chris Cox and Bill Archer, have penned an important WSJ column:
In 1994 we predicted that, unless something was done to control runaway entitlement spending, Medicare and Social Security would eventually go bankrupt or confront severe benefit cuts. Eighteen years later, nothing has been done. Why? The full extent of the problem has remained hidden from policy makers and the public because of less than transparent government financial statements.
The actual liabilities of the federal government—including Social Security, Medicare, and federal employees' future retirement benefits—already exceed $86.8 trillion, or 550% of GDP. For the year ending Dec. 31, 2011, the annual accrued expense of Medicare and Social Security was $7 trillion. Nothing like that figure is used in calculating the deficit. In reality, the reported budget deficit is less than one-fifth of the more accurate figure.
As of the most recent Trustees' report in April, the net present value of the unfunded liability of Medicare was $42.8 trillion. The comparable balance sheet liability for Social Security is $20.5 trillion. It becomes clear that to collect enough tax revenue just to avoid going deeper into debt would require over $8 trillion in tax collections annually. That is the total of the average annual accrued liabilities of just the two largest entitlement programs, plus the annual cash deficit. In short, if the government confiscated the entire adjusted gross income of these American taxpayers [> $66K], plus all of the corporate taxable income in the year before the recession, it wouldn't be nearly enough to fund the over $8 trillion per year in the growth of U.S. liabilities.Reality check: We are spending $3.7T annually. Actually the position is somewhat understated because they are talking of the need to cover an additional $8T (to the $2.6T the Feds are already collecting). In other words, even if we paid 4 times the taxes we are paying, it's not enough. Plus, we cannot count on foreign investors to bail us out. Fewer buyers normally translates to lower prices and higher yields. Our annual interest payments could explode. Never mind if the economy ever does pick up; the Fed would have to raise interest rates, sell bonds like crazy or raise reserve requirements to control inflation, which could throw the economy into a tail spin.
As for the blatant hypocrisy of the Demagogue-in-Chief, whom says, when it comes to spending other people's money, "We can't afford to do nothing."...
Musical Interlude: Christmas Retrospective
Charlie Brown (Vince Guaraldi Trio), "Linus and Lucy"
