Every trial endured and weathered in the right spirit
makes a soul nobler and stronger than it was before.
James Buckham
Image of the Day
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| Via Dollar Vigilante |
The Denny Hastert "Scandal": Time to End This Morally Corrupt Federal Structuring Policy
I, in a slight way, have been touched by this insane government policy, which I haven't discussed until now. There have been slow periods during the Great Recession when I've had a contingent offer, waiting for various end client approvals, which in some cases can take up to several months to close (if ever). As any familiar reader to this blog knows, I have a principled objection to government assistance programs; like many others, I establish one or more rainy-day funds to cover my basic expenses. In this one particular case, I had basically liquidated one of my rainy day funds into my checking account and simply paid expenses through my checking account (I average less than 1 ATM transaction, including withdrawals, a year).
So one day I signed into my bank account just to find myself having to answer several questions which seemed to suggest my account had come under scrutiny for possible money laundering activities. I have held this bank account for probably 15-20 years, and I know they wouldn't have done something outrageous like this without being pushed by the government. It absolutely infuriated me that the government was scrutinizing what I was doing with my own property, which is blatantly unconstitutional and none of its damn business.
I'm not going to comment in depth here on Hastert (see here for more detailed discussion); I'm not a big Hastert fan--I think the House GOP losts its reformist edge during his tenure as House Speaker, and I've criticized him on a few occasions over the life of the blog, but on this issue, Hastert is truly getting screwed over. To briefly summarize: Hastert was getting blackmailed by what seems to have been an alleged sexual impropriety with a young man during Hastert's earlier career as an educator. Hastert has been withdrawing money in $50K increments to pay off the blackmailer. Those withdrawals came under scrutiny from the government. When questioned by the government over the withdrawals, Hastert claimed that he didn't trust the bank with his money. So the government is going after Hastert for not exposing the politically embarrassing story of the extortion; in the Alice-in-Wonderful view of the federal government, the problem is not with the guy who has been extorting Hastert but Hastert's lack of candor of describing withdrawals, not based on alleged Hastert improprieties of money laundering, etc., but on the federal government's blanket scrutiny of what it considers "too big" deposits/withdrawals under so-called structuring laws and trying to "hide" even innocuous transactions from an overreaching government.
Elon Musk and a Libertarian Kerfuffle Over His Use of Tax Gimmicks to Build a Politically Correct Business Empire
I've been in a Jeffrey Tucker Facebook group; a fellow Catholic libertarian, he's one of what I would list as the 4 most prominent Catholic libertarians, along with Tom Woods, Judge Napolitano, and Lew Rockwell. But libertarians often clash on specific issues. For example, I'm pro-life and oppose State intervention on marriage. Tucker opposes the concept of intellectual property, which I strongly support, and we've clashed over the past 2-3 weeks over Tucker's gushing support of Elon Musk's Tesla. I strongly criticized Musk's exploitation of tax gimmicks (like the $7500 tax credit for yuppie purchasers of his electric vehicles). Tucker seemed rattled by our exchange, and sometime later revisited the argument by noting a legalistic distinction between tax credits and subsidies. (I've sometimes referenced this distinction which is probably best known in the context of education policy; the courts have favored the tax credit vs. government funding of education alternatives to local public school monopolies.) His position was basically don't hate the player: hate the game, i.e., don't blame Tesla buyers for reducing their own taxes; the rest of us are just jealous we don't have our own $7500 tax credits. The basic issue is government is stealing from all of us, and we shouldn't blame people for wanting to keep more of their own income. My point is, you're playing a sophistic game; the hodgepodge of tax gimmicks represents unwarranted State intervention in the economy, picking winners and losers, intrinsically corrupt policy.
The LA Times has an interesting feature on how 3 of Musk's enterprises (Tesla, Solar City, and SpaceX) have attracted nearly $5B in government support. The gameplaying by Musk's management, playing one state against another for tax giveaways is nauseating but not unexpected given the nature of political whores. However, one particularly objectionable discussion involves how Nevada initially rejected what Musk wanted to build a massive facility there, but then came up with a counter offer:
They shored up the deal with an agreement to give Tesla $195 million in transferable tax credits, which the automaker could sell for upfront cash. To make room in its budget, Nevada reduced incentives for filming in the state and killed a tax break for insurance companies.There shouldn't be tax gimmicks of any kind, never mind for green energy, entertainment, insurance or 1001 other industries.
Nevada Gov. Brian Sandoval and Musk sealed the agreement in a Labor Day phone conversation. Hill [Nevada's wheeler-dealer] said it was worth it, pointing to the 6,000 jobs he expects the factory to eventually create.
Facebook Corner
(National Review). Hillary Clinton is an artful dodger when it comes to taking positions on lots of issues, but last week she opened a clear gap between herself and virtually every possible GOP presidential candidate.
I find it mind-boggling that the author doesn't acknowledge two of the GOP frontrunners, Rand Paul and Marco Rubio, came out in favor of ending Ex-Im some time back.
(a follow-up exchange on yesterday's FEE thread on the minimum wage)
An earned income credit is a start. Social welfare programs are also a good start. But for highly profitable corporations like McDonald's and Walmart, there needs to be some way to facilitate fair treatment of the worker. Walmart is notoriously anti-union, and unions are one of the most effective strategies to prevent worker abuse. Facilitating a living wage is a good strategy to ensure that people are either employed fairly or not employed at all.
And even if they are unemployed, it's interesting to note that food stamps are one of the most effective types of economic stimulus, where every dollar offered becomes 1.3 in economic activity.
No, I actually oppose both earned income tax credit and social welfare, it's just that the earned income tax credit is less morally hazardous and economy-damaging--it also spreads the cost of this assistance across the economy, vs. hitting the plurality of small businesses .(There are the predictable problems with the earned income tax credit, e.g., when do you stop supplementing income, and you lower the incentive for workers to improve their skills, knowledge, etc., to strive for higher-paying jobs.)
The private sector, not parasitic highly-compensated government bureaucrats with a vested interest in a permanent underclass, is and always has been a better way to address the poverty issue. As ro your economically illiterate and paranoid corporation-bashing, the fact of the matter is that Wal-Mart and McDonald's have to offer market-competitive wages or no one would work there; you are also ignoring the fact that a large plurality of workers on minimum wage (probably 3% or so) are younger workers, household dependents, not heads, so your inequality propaganda falls short.
As for the discredited faux-economics Keynesian crap dished out by self-serving Krugman and his like, people do eat, whether or not we're in a recession, and there's no magic to the use of stolen redistributed tax dollars. If you think the ruling class (overpaid political whores and government bureaucrats) don't take a big bite out of the special-interest SNAP program--or if the government debt used to finance the program aren't a huge offsetting cost, you're delusional.
Political Cartoon
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| Courtesy of the original artist via the Washington Examiner |
Musical Interlude: My Favorite Vocalists
Cat Stevens, "Sitting".
