Archive for February 2012

Raise the Payroll Tax

Yesterday, Congress agreed to extend the payroll tax reductions for another period of time.  I have been thinking about this for a while, and I am slowly coming to the conclusion these taxes should be raised.  I am still thinking this through so I welcome feedback.

I don't think I have to convince regular readers of this site that I am against government-run and mandated-for-all retirement funds (income via Social Security, medical via Medicare).  But if we are going to have such programs, and maintain the pretense that they are insurance programs and not welfare/transfer programs, then the "premiums" we are forced to pay should reflect true costs.

I don't think Medicare premiums are covering anywhere near the actuarial-expected costs of one's future medical care.  And while Social Security rates may be set correctly if trust funds were truly held securely, the fact of the matter is that past Social Security premiums that were paid to support future benefits have all been spent by a corrupt Congress.  Rates are going to have to be raised to replace this theft.

I don't like raising taxes.  I wish these two programs would go away or else be restructured drastically.  If they exist, though, there is nothing more dangerous than an incorrect price.  Prices help consumers make price-value tradeoffs -- the Keanu Reeves lifetime DVD collection may be a deal at $6.99 but not at $99.99.  So charging the wrong prices for these programs not only royally screws up the government's finances, but it also misleads Americans about the value of these programs in comparison to what they pay for them.

Where is This?

This is actually the inside of the White House during the Truman Administration.  I had realized it was "renovated", but I think I pictured something less dramatic.  It appears the place was totally gutted.

Will Reality Never Set In?

I had thought the situation in Greece would eventually hammer home for everyone the perils of reckless enlargement of the state and deficit spending.  But apparently, it is not to be.  This is how Kevin Drum describes the core problem in Greece:

the austerity madness prompted by the 2008 financial collapse

So the problem is not a bankrupt state, but the "austerity" which by the way has at best carved only a trivial amount out of spending.  And it was triggered not by a ballooning deficit as a percent of GDP and an inability to meet interest and principle payments, but by the US financial crisis.

This is willful blindness of absolutely astounding proportions.  Which means the same folks are likely just rehearsing to ride the US right into the same hole.

From the Interesting to the Irrelevent

Interesting stuff about Media Matters:  The lengths they went to to manufacture a war with Fox are astounding.  In a real surprise for me, this is actually worse than some Republican's ranting about the organization.  I have no problem with focusing your speech on a particular media outlet to repeatedly challenge what they are saying, but doing oppo research into reporters personal lives?

On the other hand, this "expose" into Media Matters' funding and spending seems entirely irrelevant.  Political organizations seek money from rich people who agree with them?  And liberal groups sometimes give money to other liberal groups?  Who knew?  If those are the top 10 most interesting nuggets in their financials, we can move along now.

Update:  Per a reader, I suppose the tax return stuff might be relevant to their 501(c)3 status, but even so I don't see any bombshell here.  The bombshell would seem to be in their activities, not their funding, but I am not an expert on the law.  Besides, I think all organizations should be tax-free so I wasn't really focused on that issue.

Update #2:  Apparently, there is an equally irrelevant scrutiny occurring of the Heartland Institute's funding and spending.  OMG, yet another non-profit fundraising from rich people who agree with its positions.

Oh, For God Sakes

From today's AZ Republic

Women have wrinkles, pores and curves. And there's a movement across the world to make sure advertisers can no longer pretend otherwise.

Now, that movement has come to Arizona.

House Bill 2793, proposed by Rep. Katie Hobbs, D-Phoenix, would require advertisers who alter or enhance a photo to put a disclaimer on that ad alerting customers that "Postproduction techniques were made to alter the appearance in this advertisement. When using this product, similar results may not be achieved."

Really?  You mean my wife isn't going to suddenly look like Demi Moore if she uses Dove soap?  Next you are going to tell me that drinking Miller Lite does not cause me to suddenly be surrounded by hot women.

Update:  Apprarently this is about empowering women by treating them like moronic rubes

"As an organization, we are all about empowering women and eliminating discrimination," Richard said. "We want to make sure that young women get a better start and better self-image."

He said girls need to understand that these photos aren't all real. Someone has airbrushed out the model's wrinkles and pores, or put a woman's head on top of a computer-generated perfect body.

"You need to disclose that so our young women don't grow up thinking a poreless face is possible," he said. "That's not the way that I think anyone wants to raise their daughters."

Politics and Ideology

A week or so ago I wrote an article for attempting to summarize the climate debate.  Despite the fact (or maybe because of the fact) that I was clear about my personal position in the debate, I thought it was a fair outline of the state of the debate.  In retrospect, one reason I thought it was a useful article is because nowhere in it did I use the words "liar", "myth", "conspiracy", "___-funded", or "scam."  I did not hypothesize about either side's motivations or sources of funding or engage in any sort of ad hominem attack.  In short, while I sometimes said people were wrong, I never said they weren't well-intentioned.

Which is why I enjoyed this post from Chris at the Liberty Papers, which used as a starting point my wondering why my opposition could not be treated as well-intentioned, honest disagreement rather than some sort of scheming.

 they are arguing from ideology not from reality. They believe in what HAS to be true, because their ideology says so; not what reality, or experience, proves to be true.

Their ideology is core to their perception of their identity, and their sense both of self worth, and the worth of others. Their judgement and reason are based on it. Everything is filtered through this ideological prism, because it HAS to be, for the health of their own psyche.

For someone whose entire perception of self worth depends on their adherence to an ideological precept (“I am a good/better person because I believe this morally better thing”), then anyone who disagrees with this precept must be stupid, ignorant, defrauded, deluded, or evil.

There is no room for honest disagreement in this. To preserve their self worth, and sense of identity, there can be no doubt, and no acceptance of any possibility of error. There is one true path, which they follow, and anyone who deviates from it is apostate.

If therefore, one cannot dismiss opponents of their ideological precept as stupid, ignorant, defrauded, or deluded (and in the case of clearly intelligent, well informed people, presenting reasoned arguments against your precepts, you obviously cannot); the only thing you can challenge is their motives.

This certainly rings true to an extent.  I guess my thought is that there is no we-they here.  To some extent we all have a share of this tendency.  I find myself, all the time, wanting to immediately accept evidence that confirms my world view and trying to find reasons why I should not have to accept evidence that seems to contradict that view.  I am more or less succesful in fighting this depending on the day of the week.

But what I have no tolerance for is the demonization of opposition as a substitute for fact-based rebuttal, and even better, working to understand what differences in core assumptions lay at the heart of the disagreement.  The healthiest possible discussion is to trace competing arguments back to the point where both sides can say, yes, here's where we diverge.  I would like to think my climate article last week was a good example of doing this.

We Love Drone Strikes

Kevin Drum points to a poll showing that 2/3 of Americans, and a majority of liberal Democrats, support drone strikes, even if the targets are Americans.  Like me, he finds these numbers disturbing, though in a later post he hypothesizes that people may mean they like drones in comparison to using and risking live troops, rather than simply supporting willy nilly drone strikes per se.

It is odd that the children of the sixties -- who grew up protesting push button war and American pilots who bombed Cambodians with impunity and were home for dinner -- now seem to be OK with drone attacks, even on Americans.  (I am reminded of the Al Franken skit on SNL where he editorializes that now that he has assets to protect and is older, he has changed his mind and supports the draft).  While I am happy with the idea of technologies that keep American soldiers safer, I am not happy with something that makes it easier for the President to, without accountability and often in secret, use force against, well, whatever target catches his whim.

Consider drones from the receiving end.  For a Pakistani, American drones resemble nothing so much as alien invaders from a Niven/Pournelle novel dropping meteors on cities.  The Americans might as well be Zeus on Mt Olympus hurling thunderbolts at them for all that they can fight back or retaliate.   It's a lot of responsibility to play God -- and there has been no one in either party over the last several decades I would trust to do it.

Ayn Rand, Illegal Immigrant

Interesting story via Reason

As a vehement anti-Bolshevist, she knew that she would die waiting in line if she applied for permission to permanently relocate to America, although that’s exactly what she intended to do. Temporary tourist visas were easier to land, but only for those who could prove they didn’t plan to settle here. So what did Rand do? She committed perjury. She convinced an American visa officer that she had a fiancé waiting for her in Russia whom she intended to marry after a six-month visit with her relatives in Chicago.

But Rand instead married an American citizen in 1929, gaining a path to citizenship. According to Mimi Gladstein’s biography, Rand timed her wedding before her visa, which she had gotten extended, finally expired.

However, others doubt that Uncle Sam would have handed a three-year extension to a Russian passport holder, raising suspicions that Rand might have been—gasp!—an illegal immigrant when she got married.

Great Moments in Bad Ideas

Via the Weekly Standard (with video):

Gene Sperling, director of the White House's national economic council, said today at an official meeting that "we need a global minimum tax":

Pegging our tax rates to France is almost as good an idea as pegging our exchange rates to Greece.

Also, this statement is a hilarious mass of contradictions

“He supports corporate tax reform that would reduce expenditures and loopholes, lower rates for people investing and creating jobs in the U.S., due so further for manufacturing, and that we need to, as we have the Buffett Rule and the individual tax reform, we need a global minimum tax so that people have the assurance that nobody is escaping doing their fair share as part of a race to the bottom or having our tax code actually subsidized and facilitate people moving their funds to tax havens," Sperling said.

He wants to lower rates for people investing, but he wants to institute the Buffett Rule, which effectively raises taxes on people whose income is substantially dividends and capital gains, ie people who invest.  He wants special rates for creating jobs and extra special rates in manufacturing, but he wants to get rid of loopholes, most of which were created at least with the nominal intent of spurring investment in certain sectors, particularly manufacturing.

New Obama Taxes

Bruce McQuain has a roundup.    Here is the list from the American via Q&O:

1. The top income rate would be raised to 39.6 percent vs. 35 percent today.

2. Under the “Buffett rule,” no household making over $1 million annually would pay less than 30 percent of their income in taxes.

3. Between now the end of a second Obama term, Obama proposes $707 billion in “net deficit reduction proposals.” Of that amount, only 16 percent is spending cuts.

4. The majority of small business profits would be taxed at 39.6 percent vs. 35 percent today.

5. The capital gains rate would rise to 25.0 percent (including the Obamacare surtax and deduction phase out) from 15 percent today.

6. The double-tax on corporate profits (including dividends) would increase to 64 percent based on the statutory corporate tax rate (58 percent using the effective tax rate), easily the highest among advanced economies.

7. The double tax on corporate profits (including capital gains) would increase to 51 percent (44 percent using the effective tax rate), also among the highest among advanced economies.

I think they may be under-estimating the double taxation of corporate income as the Buffett rule would increase the capital gains and dividends tax to 30% for wealthy individuals who rely mostly on these as a source of income.

Given that his own party would not pass most of this stuff last year, it is impossible to believe they will pass it in an election year.


Happy Florist and Restaurant Promotion Day

Also, apparently its the 100th anniversary of Arizona statehood.  I am kind of proud of my state for making this anniversary a virtually ignored event.

Go Gary Johnson

I decided today to volunteer for Gary Johnson's independent libertarian run for President.  I have always been a Johnson supporter, and was disappointed that he did not get more attention in the debates and nomination process.

Yes, I know folks will be saying that if Gary Johnson does well, it will just be guaranteeing an Obama victory.  You know what?  Given the choices, I don't care.  My other choices seem to be the guy who pilot-tested Obamacare and Rick Santorum, perhaps the only person the Republicans could have found with a deeper authoritarian streak than Obama.  You know those 2x2 matrices where one leg is "government intervention in social issues" and the other is "government intervention in economic issues?"  Where libertarians are low-low and Republicans and Democrats are each in one of the low-high boxes?  Did you ever wonder who was in the high-high box?  Well, Obama has moved pretty strongly into that space.  But Santorum staked it out years ago.   He is right out of the John McCain, I-am-nominally-for-small-governemnt-but-support-authoritarian-solutions-for-a-range-of-random-issues school.

In fact, I might argue that freedom and small government would be better served by an Obama second term that the yahoos likely to gain the Republic nomination.  First, there is nothing worse than having statism and crony capitalism sold by someone who is nominally pro-market (see either of the Bushes as an example).  Second, Republicans are much feistier about limiting spending and regulation in Congress when in opposition.  They tend to roll over for expansions of state power when they have a fellow Republican in the White House -- just compare spending of the Republican Congress under Clinton vs. Bush.  Medicare Part D, anyone?

As I heard Ayn Rand say in a public speech in 1981, there is only so far I can go choosing the lesser of two evils.  I am now all in for Gary Johnson.

None of the Police Officers Were Held Accountable For Their Behavior

Outrageous. More at Radley Balko's place.

Chinese Declaration of Independence

This is a story I don't know enough about

Farmers from 18 households in Xiaogang signed a secret life-and-death agreement ending collective farming with their thumbprints. (From Cowen and Tabarrok, Modern Principles: Macroeconomics)

The Great Leap Forward was a great leap backward – agricultural land was less productive in 1978 than it had been in 1949 when the communists took over.  In 1978, however, farmers in the village of Xiaogang held a secret meeting.  The farmers agreed to divide the communal land and assign it to individuals – each farmer had to produce a quota for the government but anything he or she produced in excess of the quota they would keep.  The agreement violated government policy and as a result the farmers also pledged that if any of them were to be killed or jailed the others would raise his or her children until the age of 18. [The actual agreement is shown at right.]

The change from collective property rights to something closer to private property rights had an immediate effect, investment, work effort and productivity increased.  “You can’t be lazy when you work for your family and yourself,” said one of the farmers.

Word of the secret agreement leaked out and local bureaucrats cut off Xiaogang from fertilizer, seeds and pesticides.  But amazingly, before Xiaogang could be stopped, farmers in other villages also began to abandon collective property. In Beijing, Mao Zedong was dead and a new set of rulers, seeing the productivity improvements, decided to let the experiment proceed.

The Bankrupt as Victims

One of the amazing aspects of our new post-modern outlook on personal responsibility and obligations is that folks who are profligate and take on too much debt are increasingly considered victims to which other people owe something (generally a bailout).

We see this no only among US mortgage holders but in Greece as well

Greek Prime Minister Lucas Papademos told lawmakers to back a deeply unpopular EU/IMF rescue in a vote on Sunday or condemn the country to a "vortex" of recession.

He spoke in a televised address to the nation, ahead of Sunday's vote on 3.3 billion euros ($4.35 billions) in wage, pension and job cuts as the price of a 130-billion-euro bailout from the European Union and International Monetary Fund.

The effort to ease Greece's huge debt burden has brought thousands into the streets in protest, and there were signs on Saturday of a small rebellion among lawmakers uneasy with the extent of the cuts.

So outsiders generously agree to pay for 130 billion Euros of past Greek spending if only the Greeks will cut their current spending by 3.3 billion Euros (at which spending level the country would still be running large deficits).  And people riot as if they have been gang-raped.  Incredible.

Let the Greeks go.  Of course, this is not actually about bailing out Greece, but about bailing out, indirectly, European banks that invested in Greek bonds.  The banks seem to run public policy in Europe, even more so than in the US.

I Wonder

We would all like to think we would bravely stand up for what we believe in against any tyranny, but I wonder.  It takes a lot of guts not to just go along, especially when your life is on the line.  This man, refusing to give the Nazi salute, apparently died in captivity or was killed in 1944.

Thoughts on the Contraception Debate

1.  It is insane that "insurance" covers routine birth control in the first place.  It makes as much sense as your home insurance covering air filter replacements

2.  This is what one should expect when the government engages in coercion to force everyone to a single standard.  We have seen arguments like this for decades in public schools over what should and should not be taught.

3.  Expect a lot more of this  -- the benefits you will be forced to pay for in your health insurance will increasingly be determined by the political power of lobbying groups, as interest groups fight to have their members subsidized by everyone else and businesses work to get their product or procedure on the coverage list.   Economic and medical rationality will have nothing to do with what's actually covered.  And you can be damn sure that your personal preferences will be considered irrelevant.

OMG, We Have Really Hit Bottom - Young People Forced to Work to Support Themselves

Back when he was blogging, TJIC had a nice little animated gif with people running around yelling "Oh Noz."

 [update:  sent to me by by the folks at finem respice]

I wish I had it for this chart and the accompanying text  (via Kevin Drum)

Many young adults have felt the impact of the recession and sluggish recovery in tangible ways. Fully half (49%) of those ages 18 to 34 say that because of economic conditions over the past few years, they have taken a job they didn’t really want just to pay the bills. More than a third (35%) say they have gone back to school because of the bad economy. And one-in-four (24%) say they have taken an unpaid job to gain work experience.

First, this study is great evidence of my "what is normal" fail.  There is no baseline.  OK, 24% moved back in with their parents.  How many did this in good times?  How much worse is this?

But the real eye-catcher to me is that somehow I am supposed to be shocked that people have to find a job to pay the bills.  Even a job that, gasp, they really didn't want.  I have a clue for you.  A lot of jobs 22-year-olds have to take are not that compelling.  Mine were not.  Despite what colleges seem to be telling them, the world does not offer up a lot of really cool jobs to inexperienced young adults.  Long before you are closing deals with CEO's, you are probably writing sales literature in some cubicle.

And by the way, I am struck by how wealthy our society is when I look at this chart.  Look at answers two and three.   In both cases, people are saying that in tough times, they chose to forego income and build their skills, even perhaps paying for the privilege.  What other time in history would people have this luxury?  How many countries today would have so many people with this luxury in hard times?  Even in the Great Depression in this country I don't think we saw the same phenomenon.  Obviously the economy sucks and it would be great for everyone for it to improve, but in most other times and even in many other countries in the world today, a significant bar in bad times would have been "I starved to death."

The Only Cost Reduction Ideas Socialized Medicine Has

I have said for quite a while that despite all the hand-waving about  efficiency and electronic records and other BS  (efficiency from owner of the Post Office?) the only two cost reduction tools that state-run health care have are 1) Price Controls and 2) Rationing.  This has become clear yet again in California.  Allocation of scarce resource by bureaucratic fiat has NEVER worked, not only leading to mis-allocations but generally reducing the size of the pie to be allocated in the process.  The only solution is returning health care to a world (that most every other product and service is in) where consumers have the incentive to shop and make price-value tradeoffs for themselves using prices set by the free operations of supply and demand.

The Myth of Past Cultural Integration

Virginia Postrel had the same reaction to Charles Murray's recent book that I had -- it's a myth to think that there was some sort of greater cultural integration in the 1950's than there is today.  Because, you know, Wally and the Beav had so many black kids at their school.

There Be Crazy People Here

Yes, our Arizona legislature keeps cranking out the hits

In what has to be the most hilariously unconstitutional piece of legislation that I've seen in quite some time, senators in the Arizona state legislature have introduced a bill that would require all educational institutions in the state -- including state universities -- to suspend or fire professors who say or do things that aren't allowed on network TV. Yes, you read that right: at the same time the Supreme Court is poised to decide if FCC-imposed limits on "indecent" content in broadcast media are an anachronism from a bygone era, Arizona state legislators want to limit what college professors say and do to only what is fit for a Disney movie (excluding, of course, the Pirates of the Caribbeanfranchise. After all, those films are PG-13!).

Amazing.  I had thought the nominal reason for the FCC standards was because non-adults might watch TV and hear a bad word that they likely hear 20 times a day at school.  But college kids are generally adults.  This is just bizarre.

The Huffpo article did not mention the bill's sponsor, but how much do you want to be its a Conservative who has in the past lamented political correctness on campus?  [update: sponsors here]

A Guide to the Global Warming Debate

My new column at Forbes is a post I have been thinking about and working on for quite a while, trying to refine over time a simple explanation of what is and is not understood in climate science.  This is how it begins, but I hope you will read it all

Likely you have heard the sound bite that “97% of climate scientists” accept the global warming “consensus”.  Which is what gives global warming advocates the confidence to call climate skeptics “deniers,” hoping to evoke a parallel with “Holocaust Deniers,” a case where most of us would agree that a small group are denying a well-accepted reality.  So why do these “deniers” stand athwart of the 97%?  Is it just politics?  Oil money? Perversity? Ignorance?

We are going to cover a lot of ground, but let me start with a hint.

In the early 1980′s I saw Ayn Rand speak at Northeastern University.  In the Q&A period afterwards, a woman asked Ms. Rand, “Why don’t you believe in housewives?”  And Ms. Rand responded, “I did not know housewives were a matter of belief.”  In this snarky way, Ms. Rand was telling the questioner that she had not been given a valid proposition to which she could agree or disagree.  What the questioner likely should have asked was, “Do you believe that being a housewife is a morally valid pursuit for a woman.”  That would have been an interesting question (and one that Rand wrote about a number of times).

In a similar way, we need to ask ourselves what actual proposition do the 97% of climate scientists agree with.  And, we need to understand what it is, exactly,  that the deniers are denying.   (I personally have fun echoing Ms. Rand’s answer every time someone calls me a climate denier — is the climate really a matter of belief?)

It turns out that the propositions that are “settled” and the propositions to which some like me are skeptical are NOT the same propositions.  Understanding that mismatch will help explain a lot of the climate debate.

Fritz Vahrenholt Climate Book

A lot of folks have asked me if I am going to comment on this

One of the fathers of Germany’s modern green movement, Professor Dr. Fritz Vahrenholt, a social democrat and green activist, decided to author a climate science skeptical book together with geologist/paleontologist Dr. Sebastian Lüning. Vahrenholt’s skepticism started when he was asked to review an IPCC report on renewable energy. He found hundreds of errors. When he pointed them out, IPCC officials simply brushed them aside. Stunned, he asked himself, “Is this the way they approached the climate assessment reports?”

I have not seen the book nor the Der Spiegel feature, but I can say that, contrary to the various memes running around, many science-based skeptics became such by exactly this process -- looking at the so-called settled science and realizing a lot of it was really garbage.  Not because we were paid off in oil money or mesmerized by Rush Limbaugh, but because the actual detail behind many of the IPCC conclusions is really a joke.

For tomorrow, I am working on an article I have been trying to write literally for years.  One of the confusing parts of the climate debate is that there are really portions of the science that are pretty solid.  When skeptics point to other parts of the science that is not well-done, defenders tend to run back to the solid parts and point to those.  That is why Michael Mann frequently answers his critics by saying that skeptics are dumb because they don't accept greenhouse gas theory, but most skeptics do indeed accept greenhouse gas theory, what they don't accept is the separate theory that the climate is dominated by positive feedbacks that amplify small warming from CO2 into a catastrophe.

This is an enormous source of confusion in the debate, facilitated by a scientifically illiterate press and alarmists who explicitly attempt to make this bate and switch so they can avoid arguing the tough points.  Even the author linked above is confused on this

Skeptic readers should not think that the book will fortify their existing skepticism of CO2 causing warming. The authors agree it does. but have major qualms about the assumed positive CO2-related feed-backs and believe the sun plays a far greater role in the whole scheme of things.

This is in fact exactly the same position that most skeptics, at least the science-based non-talkshow-host ones have.  Look for my Forbes piece tomorrow.

Phoenix Police Fail

On the way to work today, which is normally only a 5-minute drive for me, there was a small fender-bender among a couple of cars.  The cars did exactly what you are supposed to do:  they pulled off the road into a nearby parking lot so they would not block traffic.  The police could not be bothered, and just parked in the right lane, jamming traffic up for a mile or so.  I looked - there was no debris or anything in the road that they were trying to block (you can confirm that from the picture below), the police simply did not have the common courtesy that the other drivers had.

Yes, the police car below is actually parked and unoccupied in the right lane at morning rush hour.  The citizens involved can be seen pulled into the parking lot at the left.  Though it is hard to see from the picture, the traffic backup extends well into the distance.

War on Drugs = War on Americans

Via Radley Balko, a woman faces a year in prison for buying a single box of Sudafed and transporting it across state lines.  Really.

Don't miss the super BS statistic quoted by the state that they have seen an 80% decline in the children endangered by meth labs.