We're now hosted on our own domain at www.morallibertarian.com. Be sure to update your favorites and follow the new blog. They don't make migration easy, but I'll be able to add additional pages and features to the new site over time.
Looking forward to your comments.
Friday, August 12, 2011
Thursday, August 11, 2011
Mission Ridiculous...
Why does it feel like amateur hour in the manner in which our nations military is being operated? From published troop movements, to firm dates of withdrawal being set. The unecessary wars that are being waged in Afghanistan, Yemen, Libya and Iraq (yes, still in Iraq) seem more and more like they're being conducted by some guy in the basement with a headset and an XBox controller.
Special Ops are being over-used and we're losing some of our best because of it.
First we hear that the recently killed SEALS were on a rescue mission of other commandos, now it appears that what they were really doing is going in to harry a retreating foe. I don't condone armchair quarterbacking, but let's at least make sure the signal callers are more experienced than that pimply faced kid or our ivy league president.
Special Ops are being over-used and we're losing some of our best because of it.
First we hear that the recently killed SEALS were on a rescue mission of other commandos, now it appears that what they were really doing is going in to harry a retreating foe. I don't condone armchair quarterbacking, but let's at least make sure the signal callers are more experienced than that pimply faced kid or our ivy league president.
Wednesday, August 10, 2011
Entitlement Society
Entitlement. It's a word that makes me cringe more than just about any other. From Entitlement Spending to being told that someone is "entitled to respect," the sense of the same is burning through our nation and our world like a disease.
Webster defines the word in one sense as a Right and in another as a Privilege. Maybe this explains the confusion surrounding the word. If you are entitled to respect, what that really means is that you deserve respect because you have earned respect. If you think that you are entitled to respect simply for being, well, get over yourself pal. I may treat you respectfully, that doesn't mean I am required by law to actually respect you, nor will I.
Another of Webster's definitions is that of an entitlement spending program. A right to payment created by act of law. When you think you're entitled to money simply for being...well, I think that's a problem. However, entitlements that come through what is earned, that is not so much of a problem.
Next time you hear someone say that they are entitled to this, ask them if they've earned it. The reaction I get is both amusing and disheartening.
If you want to know what an entitlement society looks like when the entitlements begin to ebb, look at England over the past 4 days and Greece over the past 18 months. The governments of those countries have had to retract many of their something for nothing pledges. Riots, fires, looting, murder. This is the response of the huddled masses. They just want the "respect they're entitled to." So, how do they earn that respect, by destroying homes, property, businesses, lives. By rampaging through Manchester and London or Athens? One couple was seen rampaging through the streets with their child along in her stroller. As windows were smashed, storefronts looted, they jovially trotted along with the crowd, hurling insults at police.
This is the entitlement society.
In Wisconsin, some were hoping for similar scenes leading up to the recall attempts against 6 Republican Senators in that state. A supporter of the movement and Professor of Political Science lamented that the "revolution has not occurred" and "the Proletariat did not take over the streets." I am not sure if the lament was because the scenes of this past winter did not repeat themselves in Wisconsin's capital or because the losses prevent the extension of entitlements by right. More likely it's both. That story is here.
More and more I've begun to believe that our world is turning into Never Never Land. Where no one wants to grow up and take responsibility for their own lives. Instead, we're all entitled to life and happiness at the cost of liberty. It's time to cast off these delusions, it's time to grow up.
Webster defines the word in one sense as a Right and in another as a Privilege. Maybe this explains the confusion surrounding the word. If you are entitled to respect, what that really means is that you deserve respect because you have earned respect. If you think that you are entitled to respect simply for being, well, get over yourself pal. I may treat you respectfully, that doesn't mean I am required by law to actually respect you, nor will I.
Another of Webster's definitions is that of an entitlement spending program. A right to payment created by act of law. When you think you're entitled to money simply for being...well, I think that's a problem. However, entitlements that come through what is earned, that is not so much of a problem.
Next time you hear someone say that they are entitled to this, ask them if they've earned it. The reaction I get is both amusing and disheartening.
If you want to know what an entitlement society looks like when the entitlements begin to ebb, look at England over the past 4 days and Greece over the past 18 months. The governments of those countries have had to retract many of their something for nothing pledges. Riots, fires, looting, murder. This is the response of the huddled masses. They just want the "respect they're entitled to." So, how do they earn that respect, by destroying homes, property, businesses, lives. By rampaging through Manchester and London or Athens? One couple was seen rampaging through the streets with their child along in her stroller. As windows were smashed, storefronts looted, they jovially trotted along with the crowd, hurling insults at police.
This is the entitlement society.
In Wisconsin, some were hoping for similar scenes leading up to the recall attempts against 6 Republican Senators in that state. A supporter of the movement and Professor of Political Science lamented that the "revolution has not occurred" and "the Proletariat did not take over the streets." I am not sure if the lament was because the scenes of this past winter did not repeat themselves in Wisconsin's capital or because the losses prevent the extension of entitlements by right. More likely it's both. That story is here.
More and more I've begun to believe that our world is turning into Never Never Land. Where no one wants to grow up and take responsibility for their own lives. Instead, we're all entitled to life and happiness at the cost of liberty. It's time to cast off these delusions, it's time to grow up.
Tuesday, August 9, 2011
Who's Going to Get us Out of This Mess?
We are. You and I will do it. We, the workers, thinkers, innovators and doers of this nation will lift us up and carry us through these times of economic uncertainty. Do not ask the government, do not expect any aid from that quarter. Demand instead that they remove their impediments to innovation, remove the incentives for failure.
In too much of our lives now we look to the Government to solve our problems. Problem with schools, what is the Government doing to help? Problem with crime? What is the Government doing? The more effective response to both of these is community action. Schools with more parental involvement are many times more successful than schools with low parental involvement. Areas that have a neighborhood watch, community involvement, and that participate in the "Night Out" program typically have much lower rates of crime.
Our nation is riddled with examples of how we, the People of this nation, are better equipped than our Government to handle our problems for ourselves. Social Security isn't enough to retire on, for many, it barely makes a dent in their retirement plans. Anyone under 50 who anticipates Social Security being around for them is probably delusional. Self-saving plans, 401(k), IRA, etc have become the mainstay of most retirement portfolios.
Trial lawyers, while they have overshot their marks far too often (mainly due to government interference in loosening standards) are responsible for keeping more unsafe products, medicines, and foods out of the stream of American commerce than the FDA, USDA, and EPA combined.
We are the answer. As individuals, as families, as neighbors, as communities, as cities and states and this one nation, we the people are the answer.
In too much of our lives now we look to the Government to solve our problems. Problem with schools, what is the Government doing to help? Problem with crime? What is the Government doing? The more effective response to both of these is community action. Schools with more parental involvement are many times more successful than schools with low parental involvement. Areas that have a neighborhood watch, community involvement, and that participate in the "Night Out" program typically have much lower rates of crime.
Our nation is riddled with examples of how we, the People of this nation, are better equipped than our Government to handle our problems for ourselves. Social Security isn't enough to retire on, for many, it barely makes a dent in their retirement plans. Anyone under 50 who anticipates Social Security being around for them is probably delusional. Self-saving plans, 401(k), IRA, etc have become the mainstay of most retirement portfolios.
Trial lawyers, while they have overshot their marks far too often (mainly due to government interference in loosening standards) are responsible for keeping more unsafe products, medicines, and foods out of the stream of American commerce than the FDA, USDA, and EPA combined.
We are the answer. As individuals, as families, as neighbors, as communities, as cities and states and this one nation, we the people are the answer.
Monday, August 8, 2011
What's the Line?
Obama is about to speak on the economy. What kind of odds can I get that he blames Bush, Republicans, Tea Party miscreants? What are the odds on the trifecta?
I will write a blog from the progressive perspective if he honestly and humbly accepts this as his responsibility.
I will write a blog from the progressive perspective if he honestly and humbly accepts this as his responsibility.
Our Government or a Drug Pusher?
Cigarette companies used to give out free cigarettes to GI's in the field. When those soldiers returned they were loyal customers for life. Today they are condemned for these and other marketing ploys they used over the last 100 years. A doctor in California was recently convicted after getting pain treatment patients hooked on pain killers in order to manipulate them into expensive nerve block treatments. He literally turned people into addicts, then threatened to withhold new prescriptions for their pain killers if they didn't agree to undergo these expensive nerveblock shots. They were painful, but cost the patients nothing. Insurance companies paid the doctor $5,000 per shot.
Our government does something similar. You see, we have this pesky 10th Amendment that says, essentially, that on some issues the federal government can't tell the state's what to do. Well, like the tobacco company, like the drug pusher, our government has found a way to control. When the constitution doesn't allow direct manipulation of the states the feds have used Money as their drug. Federal highway dollars are dangled and states race to change laws to meet the requirements of the Central Ruler. Education money is dangled and states implement "No Child Makes It To the Top." Unemployment money is dangled and states jump on the bandwagon.
And, like a good dealer, the feds know how to keep them hooked. When the states are a little short on a test score, the feds say, sure, you can still have the money...you just can't do x or you also have to do y.
You know, the Constitution also says the feds can't tell We the People what to do in certain things...could they be doing the same thing to us? What do you think?
Our government does something similar. You see, we have this pesky 10th Amendment that says, essentially, that on some issues the federal government can't tell the state's what to do. Well, like the tobacco company, like the drug pusher, our government has found a way to control. When the constitution doesn't allow direct manipulation of the states the feds have used Money as their drug. Federal highway dollars are dangled and states race to change laws to meet the requirements of the Central Ruler. Education money is dangled and states implement "No Child Makes It To the Top." Unemployment money is dangled and states jump on the bandwagon.
And, like a good dealer, the feds know how to keep them hooked. When the states are a little short on a test score, the feds say, sure, you can still have the money...you just can't do x or you also have to do y.
You know, the Constitution also says the feds can't tell We the People what to do in certain things...could they be doing the same thing to us? What do you think?
Friday, August 5, 2011
The Petulant Child...
...was at the microphone again today. He wanted to make sure that we all knew how bad things were when he took office and dang that Congress, what's up with THOSE guys and you heard about that Tsunami right? That was bad. Then there was the Arab Spring, which is/was great, but gosh, it really hurt the economy. Bottom line, things are bad, but we need to remember that it's not his fault. He's done everything he could.
He borrowed $800 billion from your kids and grandkids to keep union workers in jobs. He bent the rules of Bankruptcy to benefit Unions and continued the plan to reward bad investments with government bailouts. He fought hard in order to raise taxes on "millionaires and billionaires," and passed a MASSIVE new government entitlement. Meanwhile his Labor Board, EPA, SEC, and Justice Department have waged an all out war on businesses. The countries mood is darker than any time since the Great Depression, the housing market is toast, the dollar is struggling hard to become worthless, and the Fed and Treasury have abdicated any responsibility over monetary policy.
Just keep in mind, none of our current problems are his fault.
You wanted the job, Mr. President, you got it. Shut up and eat your peas. Take credit for that which you have wrought.
He borrowed $800 billion from your kids and grandkids to keep union workers in jobs. He bent the rules of Bankruptcy to benefit Unions and continued the plan to reward bad investments with government bailouts. He fought hard in order to raise taxes on "millionaires and billionaires," and passed a MASSIVE new government entitlement. Meanwhile his Labor Board, EPA, SEC, and Justice Department have waged an all out war on businesses. The countries mood is darker than any time since the Great Depression, the housing market is toast, the dollar is struggling hard to become worthless, and the Fed and Treasury have abdicated any responsibility over monetary policy.
Just keep in mind, none of our current problems are his fault.
You wanted the job, Mr. President, you got it. Shut up and eat your peas. Take credit for that which you have wrought.
Thursday, August 4, 2011
Nobody Panic!!!!!
Obama is going to start concentrating on jobs again! All will be well. I repeat, no need to panic. His Majesty will be focusing on jobs again. Like a laser this time.
Wait, laser was the metaphor from the time after he was inaugurated, or maybe it was the time he focused really hard after the stimulus failed to stop the official unemployment statistic from hitting 10%. I'm pretty sure he was focused on jobs after the Senate passed health care in December of 2009, then he got REALLY focused after the House passed it in early 2010.
Seriously people. We keep hearing this same song and dance from the guy. When are you going to stop believing it? Jobs, jobs, jobs. The only jobs he's ever created have been government jobs. Meanwhile, that ever-expanding government monstrosity keeps churning out new rules and regulations. 608 new Federal Rules issued last month. That's 608 new reasons NOT to hire someone for your business. 608 reasons why you can't find a better job. 608 ways in which your freedoms were just taken away from you.
I pray that this correction is just a blip on what I hope is a stout recovery. I'm sorry to say that I just don't believe that it is. We're in for some tough times. Keep your eyes and ears open. Help your neighbor, it's not the government's job anymore and it never should have been.
Wait, laser was the metaphor from the time after he was inaugurated, or maybe it was the time he focused really hard after the stimulus failed to stop the official unemployment statistic from hitting 10%. I'm pretty sure he was focused on jobs after the Senate passed health care in December of 2009, then he got REALLY focused after the House passed it in early 2010.
Seriously people. We keep hearing this same song and dance from the guy. When are you going to stop believing it? Jobs, jobs, jobs. The only jobs he's ever created have been government jobs. Meanwhile, that ever-expanding government monstrosity keeps churning out new rules and regulations. 608 new Federal Rules issued last month. That's 608 new reasons NOT to hire someone for your business. 608 reasons why you can't find a better job. 608 ways in which your freedoms were just taken away from you.
I pray that this correction is just a blip on what I hope is a stout recovery. I'm sorry to say that I just don't believe that it is. We're in for some tough times. Keep your eyes and ears open. Help your neighbor, it's not the government's job anymore and it never should have been.
Monday, August 1, 2011
What is Baseline Budgeting
A "compromise" deal has been reached. We'll continue to borrow money to pay for an ineffective government to provide unecessary services to a nation, the majority of which does not contribute anything, much less their "fair share."
The deal allegedly calls for "massive" spending cuts. "Historic reductions in spending" show the purported resolve of our elected leaders to delay our descent into national bankruptcy. This year our government will spending $3.8 Trillion. To hear our overlords talk you'd think that next year we'd be spending significantly less than this. Not so. In fact, we'll spend more, and more the year after that, and more the year after that.
If we see massive economic growth for the next 10 years, our projected budget deficits still exceed $8 trillion. If, on the other hand, our economy continues for the next 2 years to grow at the anemic pace it has for the previous year, or worse, contracts. The 10 year deficit figures could top $12 trillion. We could easily double our national debt in 10 years.
But, doesnt' this deal cut $1 trillion in spending? If you believe that, I have an investment opportunity for you.
What the deal does is make extraordinarily optimistic ASSUMPTIONS about the growth in the economy, the capture of tax revenues at rates higher than we have ever captured them, and, most importantly, a SLIGHT reduction in the RATE OF GROWTH of government spending. That's assuming that any of these cuts ACTUALLY HAPPEN. A commission will make the recommendations, but Congress still has to agree to make it happen.
So, what is baseline budgeting. Let's assume you're going to spend $1,000 this month and next month you plan to increase your spending by 10% to $1,100 and each month thereafter you increase by 10%. $1,000 is your baseline. Pretty soon your budget has increased significantly. In 10 months, it's more than doubled. Budget "cuts" under a baseline budgeting method mean you only increase it by 9% or maybe 8% each month. Yes, you spend LESS than you had originally ASSUMED, but you're not really spending less.
This is the deal that was struck, and so we continue a long succession of presidents and congresses failing to deliver the necessary fiscal discipline to truly make this a prosperous nation.
The deal allegedly calls for "massive" spending cuts. "Historic reductions in spending" show the purported resolve of our elected leaders to delay our descent into national bankruptcy. This year our government will spending $3.8 Trillion. To hear our overlords talk you'd think that next year we'd be spending significantly less than this. Not so. In fact, we'll spend more, and more the year after that, and more the year after that.
If we see massive economic growth for the next 10 years, our projected budget deficits still exceed $8 trillion. If, on the other hand, our economy continues for the next 2 years to grow at the anemic pace it has for the previous year, or worse, contracts. The 10 year deficit figures could top $12 trillion. We could easily double our national debt in 10 years.
But, doesnt' this deal cut $1 trillion in spending? If you believe that, I have an investment opportunity for you.
What the deal does is make extraordinarily optimistic ASSUMPTIONS about the growth in the economy, the capture of tax revenues at rates higher than we have ever captured them, and, most importantly, a SLIGHT reduction in the RATE OF GROWTH of government spending. That's assuming that any of these cuts ACTUALLY HAPPEN. A commission will make the recommendations, but Congress still has to agree to make it happen.
So, what is baseline budgeting. Let's assume you're going to spend $1,000 this month and next month you plan to increase your spending by 10% to $1,100 and each month thereafter you increase by 10%. $1,000 is your baseline. Pretty soon your budget has increased significantly. In 10 months, it's more than doubled. Budget "cuts" under a baseline budgeting method mean you only increase it by 9% or maybe 8% each month. Yes, you spend LESS than you had originally ASSUMED, but you're not really spending less.
This is the deal that was struck, and so we continue a long succession of presidents and congresses failing to deliver the necessary fiscal discipline to truly make this a prosperous nation.
Friday, July 29, 2011
The Only Compromise Is Mine!
Would someone please get Mr. Reid a dictionary?
"The only compromise that there is, is mine." This after vowing to kill any chance of the republican's bill of even getting a vote on the Senate floor.
Does this surprise anyone? This is the same group that preaches tolerance, but denounces any who do not see as they see, act as they act and do as they do. (not that they're alone there. plenty on the right suffer that particular malady)
Example conversation:
"Peace and love and sunshine..."
"What do you think about Sarah Palin?"
"I HATE THAT BITCH SHE SHOULD ROT AND DIE"
"I love tolerance."
"The only compromise that there is, is mine." This after vowing to kill any chance of the republican's bill of even getting a vote on the Senate floor.
Does this surprise anyone? This is the same group that preaches tolerance, but denounces any who do not see as they see, act as they act and do as they do. (not that they're alone there. plenty on the right suffer that particular malady)
Example conversation:
"Peace and love and sunshine..."
"What do you think about Sarah Palin?"
"I HATE THAT BITCH SHE SHOULD ROT AND DIE"
"I love tolerance."
Hobbitses!
John "Gollum" McCain doesn't like those sneaking hobbitses. He blames them for taking his Precious! Well, the Hobbits have come to Mordor on the Potomac, and we all know how well that worked out for the denizens of that place.
Thursday, July 28, 2011
It must have been awful...
...before Lyndon Johnson saved us all from living in a nation of poverty. People must have been dying in the streets of untreated illnesses or starvation. What did people do before foodstamps and medicaid?
"Well, it was a different world back then. People took care of each other. They don't do that these days."
Have you ever stopped to wonder why? Why did people stop "taking care of each other?" Have you ever wondered if maybe it was because the government stepped in and said, hey, we got it from here? (As they began making plans to steal from your unborn grandchildren)
"Well, it was a different world back then. People took care of each other. They don't do that these days."
Have you ever stopped to wonder why? Why did people stop "taking care of each other?" Have you ever wondered if maybe it was because the government stepped in and said, hey, we got it from here? (As they began making plans to steal from your unborn grandchildren)
The Wealth Gap
News about the Census Data may not be as bad as it first was reported.
You know, sometimes I wonder, do they actually read the reports before writing the shocking headlines? Or is it just that you need to shock people in order to catch their interest. "If I want someone to read my story, I better make it sound catastrophic."
So, all the headlines said that the "Wealth Gap" had spread between whites and minorities. ummmmm....Duh. Tell ya what. I'm going to start with $10,000. You start with $500. In 10 years, let's see who can make that money grow more.
The other side of the story is much more interesting. The income gap is narrowing. Even considering that unemployment for black males is considerably higher than white and hispanic males, the discrepancy in income between the groups is getting smaller. Given opportunities in this country, however, shouldn't the gaps be narrowing faster? Why? Personally, I think you have to look at one of my favorite subject in these pages, the incentive.
You know, sometimes I wonder, do they actually read the reports before writing the shocking headlines? Or is it just that you need to shock people in order to catch their interest. "If I want someone to read my story, I better make it sound catastrophic."
So, all the headlines said that the "Wealth Gap" had spread between whites and minorities. ummmmm....Duh. Tell ya what. I'm going to start with $10,000. You start with $500. In 10 years, let's see who can make that money grow more.
The other side of the story is much more interesting. The income gap is narrowing. Even considering that unemployment for black males is considerably higher than white and hispanic males, the discrepancy in income between the groups is getting smaller. Given opportunities in this country, however, shouldn't the gaps be narrowing faster? Why? Personally, I think you have to look at one of my favorite subject in these pages, the incentive.
Wednesday, July 27, 2011
Why Do People Get Libertarianism Confused?
I've had many people recently tell me that they're "mostly libertarian" but go on to tell me that "rich people" and "big business" should be taxed to pay for social programs.
I'm afraid people are getting libertarianism confused with either purely social and civil liberty OR they think it sounds better than saying I'm a Big Government Liberal who thinks we need to live in a Nanny State or they're dumb (not mutually exclusive with the former choices) and think it means liberalism.
By the way, anyone who has not seen it, should go to youtube right now and search for "The Money Hole." This was a special done by John Stossell back in June. It's truly fantastic. Several people have posted the entire show together and in segments for easy digestion. The entire show is based on this sketch from TheOnion.com
I'm afraid people are getting libertarianism confused with either purely social and civil liberty OR they think it sounds better than saying I'm a Big Government Liberal who thinks we need to live in a Nanny State or they're dumb (not mutually exclusive with the former choices) and think it means liberalism.
By the way, anyone who has not seen it, should go to youtube right now and search for "The Money Hole." This was a special done by John Stossell back in June. It's truly fantastic. Several people have posted the entire show together and in segments for easy digestion. The entire show is based on this sketch from TheOnion.com
Tuesday, July 26, 2011
Incentives Re-Re-Revisited
We've talked alot in these articles about the driving mechanism in rational decision making, the incentive. We've discussed how some incentives can be monetary, some are spiritual, and some for those not spiritually inclined are those that just make you feel good.
For corporations, it's often exactly the same. For publicly traded companies, there are laws that force corporations to seek the profit incentive, but accounting concepts such as Goodwill, tax incentives such as the charitable donation write down, and other such allow them to be generous to an extent.
Corporations are about to have an opportunity to not only turn a profit, but also do what is best for their employees: Cancel their health insurance.
WHAT?? Yeah, you heard me. Not only is that the profitable alternative, but it will likely lead to better health coverage options for less money for most employees. Thanks to a poorly drafted, ill-considered, hastily passed, unread health care laws enacted last year a corporation will be able to save money by cancelling their employees health insurance plans, paying a small fine to the government (less than the cost of the plan), and then employees who make less than $70,000 per year (most working Americans!) can get government subsidies up to $7,000 per year to purchase better plans from the Health Insurance Exchanges.
Drafters and defenders of the poorly written statute claim that societal goodwill and the desire to be a Good Employer will stay the hand of most employers. Well, they haven't been paying attention. This is a double incentive. A- Saves corporate money! Hire more people and/or pay higher salaries! B- This is a financially beneficial move for the employees, especially those that already contribute a healthy amount toward their own health care.
No one would really do this, though....would they?
Yes, they would.
But, wasn't that survey discredited. While leftist bloggers did attack the survey, McKinsey & Co. did a fair job defending their methodology.
If I were a shareholder and it made sense for the company to do this, I might insist on it. A former director of the Congressional Budget Office recently issued an analysis that claimed that based on 30% droppage rate, that this beautifully drafted, artfully prepared, sarcastically described piece of legislative dung will wind up costing us an additional trillion dollars....more money we don't have.
For corporations, it's often exactly the same. For publicly traded companies, there are laws that force corporations to seek the profit incentive, but accounting concepts such as Goodwill, tax incentives such as the charitable donation write down, and other such allow them to be generous to an extent.
Corporations are about to have an opportunity to not only turn a profit, but also do what is best for their employees: Cancel their health insurance.
WHAT?? Yeah, you heard me. Not only is that the profitable alternative, but it will likely lead to better health coverage options for less money for most employees. Thanks to a poorly drafted, ill-considered, hastily passed, unread health care laws enacted last year a corporation will be able to save money by cancelling their employees health insurance plans, paying a small fine to the government (less than the cost of the plan), and then employees who make less than $70,000 per year (most working Americans!) can get government subsidies up to $7,000 per year to purchase better plans from the Health Insurance Exchanges.
Drafters and defenders of the poorly written statute claim that societal goodwill and the desire to be a Good Employer will stay the hand of most employers. Well, they haven't been paying attention. This is a double incentive. A- Saves corporate money! Hire more people and/or pay higher salaries! B- This is a financially beneficial move for the employees, especially those that already contribute a healthy amount toward their own health care.
No one would really do this, though....would they?
Yes, they would.
But, wasn't that survey discredited. While leftist bloggers did attack the survey, McKinsey & Co. did a fair job defending their methodology.
If I were a shareholder and it made sense for the company to do this, I might insist on it. A former director of the Congressional Budget Office recently issued an analysis that claimed that based on 30% droppage rate, that this beautifully drafted, artfully prepared, sarcastically described piece of legislative dung will wind up costing us an additional trillion dollars....more money we don't have.
Monday, July 25, 2011
When is a spending cut not a spending cut
If you're looking for just 1 answer, you haven't been paying attention to our Congress lately.
Scenario 1:
For years Republicans have bitterly resented the fact that cutting the rate of growth has been characterized by Democrats as a spending cut. If you propose to increase spending on program A by $10million instead of $20million, you've SLASHED their budget, blah blah blah. Well, in the interest of calling a hypocrite a hypocrite, you guys are all a bunch of hypocrites!
Right now, Republicans are trying to get the deficits trimmed. They're throwing out numbers like $1 trillion in deficit reduction, 2.4 trillion, even 4 trillion was a number out there last week. Turns out, those who have complained about the accounting shenanigans in the past are using the very same shenanigans. If it was B/S for the Dems to use it against you, it's B/S for you to use it to sell us that you're taking our debt issues seriously. MOST of the proposed $2.7 trillion cut over 10 years comes from reductions to the rate of growth of government spending. It does nothing about the currently bloated spending levels. It does nothing to encourage cost-saving within the bureaucracy.
Scenario 2: Senator Harry Reid came out today with a whopping $2.7 trillion in budget cuts. Most of which has been classified as pure sham. When $1.2 trillion is already marked for cuts, I really don't think you should trumpet it as part of your package.
Smoke and mirrors and word games. It's no wonder that Americans are fed up with Washington. Now, if only the voting public could take this pledge:
"I'll vote my bum out if you vote yours out too."
Pinky swear.
Scenario 1:
For years Republicans have bitterly resented the fact that cutting the rate of growth has been characterized by Democrats as a spending cut. If you propose to increase spending on program A by $10million instead of $20million, you've SLASHED their budget, blah blah blah. Well, in the interest of calling a hypocrite a hypocrite, you guys are all a bunch of hypocrites!
Right now, Republicans are trying to get the deficits trimmed. They're throwing out numbers like $1 trillion in deficit reduction, 2.4 trillion, even 4 trillion was a number out there last week. Turns out, those who have complained about the accounting shenanigans in the past are using the very same shenanigans. If it was B/S for the Dems to use it against you, it's B/S for you to use it to sell us that you're taking our debt issues seriously. MOST of the proposed $2.7 trillion cut over 10 years comes from reductions to the rate of growth of government spending. It does nothing about the currently bloated spending levels. It does nothing to encourage cost-saving within the bureaucracy.
Scenario 2: Senator Harry Reid came out today with a whopping $2.7 trillion in budget cuts. Most of which has been classified as pure sham. When $1.2 trillion is already marked for cuts, I really don't think you should trumpet it as part of your package.
Smoke and mirrors and word games. It's no wonder that Americans are fed up with Washington. Now, if only the voting public could take this pledge:
"I'll vote my bum out if you vote yours out too."
Pinky swear.
One Tax Code to Rule Them All
And you only thought Sauron's ring was controlling.
So, this topic comes to us courtesy of a recent op-ed in the NYT. I'd link to it, but you have to but when I tested the link it only comes up to a subscriber access page. Here's the gist. New taxes should be enacted on junk food to force people to eat healthier options. This will raise revenue and reduce obesity.
This, to me, is a frontal assault on liberty. It took a constitutional amendment to ban the sale of alcohol. Would it take a similar amendment to ban the sale of junk food? Maybe not with today's wide open commerce clause, BUT a wholesale ban would never fly. No one wants to vote on the next prohibition. So, should the government be able to do via the tax code what they couldn't do otherwise? Should they even be attempting to control what we eat? "But we have such a problem." You're absolutely right. We eat way too much junk in this country.
Shouldn't we be free to do so? Yes. Yes we should. Listen, if you tell me we should be free to suck a living child from a willing mother's womb but that the government should curb the eating of "undesirable" foods, then you seriously need to have your head examined.
If you want people to be thin, incentivize them. Allow insurance companies to charge "fit" people less than the obese. Quit classifying obesity and obesity related disabilities as qualified to receive SSDI, if after becoming fit they would still be unable to work. There are lots of ways to go about this, that don't involve the government mandating anything, either directly or through the tax code.
The broader question follows the same logic. There are ways to create the goals of many in the government, but they rely on hard work and the ability and freedom to try and fail. Just as the government shouldn't treat any one business as to big to fail, neither should they treat any movement as too big to fail. You don't need new taxes to promote a concept and influence behavior. Free the Market to do it instead.
So, this topic comes to us courtesy of a recent op-ed in the NYT. I'd link to it, but you have to but when I tested the link it only comes up to a subscriber access page. Here's the gist. New taxes should be enacted on junk food to force people to eat healthier options. This will raise revenue and reduce obesity.
This, to me, is a frontal assault on liberty. It took a constitutional amendment to ban the sale of alcohol. Would it take a similar amendment to ban the sale of junk food? Maybe not with today's wide open commerce clause, BUT a wholesale ban would never fly. No one wants to vote on the next prohibition. So, should the government be able to do via the tax code what they couldn't do otherwise? Should they even be attempting to control what we eat? "But we have such a problem." You're absolutely right. We eat way too much junk in this country.
Shouldn't we be free to do so? Yes. Yes we should. Listen, if you tell me we should be free to suck a living child from a willing mother's womb but that the government should curb the eating of "undesirable" foods, then you seriously need to have your head examined.
If you want people to be thin, incentivize them. Allow insurance companies to charge "fit" people less than the obese. Quit classifying obesity and obesity related disabilities as qualified to receive SSDI, if after becoming fit they would still be unable to work. There are lots of ways to go about this, that don't involve the government mandating anything, either directly or through the tax code.
The broader question follows the same logic. There are ways to create the goals of many in the government, but they rely on hard work and the ability and freedom to try and fail. Just as the government shouldn't treat any one business as to big to fail, neither should they treat any movement as too big to fail. You don't need new taxes to promote a concept and influence behavior. Free the Market to do it instead.
Thursday, July 21, 2011
The American Dream...
I sometimes get accused of being just a little cynical. About a lot of things, I am.
Honesty of elected officials - Cynic
Belief in the federal reserve system - Cynic
Belief that socialists on the left and evangelicals on the right are too involved in governance - Cynic.
One thing I do believe in though, is the spirit of the American People. More specifically I believe in the American Dream. I'm talking about the American Dream as my parents and my grandparents taught it to me, the Dream that's couched in hard work, and sweat and EARNING a living and BUILDING a better life for yourself and your children. Surpassing your parents and preparing your kids to surpass you. All of this is just as possible today as it was 30 years ago when I learned it, and 30 years before than when my mother was first learning it for the first time.
As I've learned recently, this is not the American Dream that many people know. Some consider the American Dream to be a spiritual quest. Finding satisifaction, be it through material, spiritual, or a strong combination of the two is a noble idea and I think fits within my own meaning.
Some Americans, however, think of the American Dream as what is their due, their right, what is given unto them. These are the habitual bankrupts, the law suit seekers, the lifelong welfare recipients, those who gave up too soon or never bothered to try. The abusers of the system fit this category in all levels of life. From the corrupt police officer or politician, to the teacher who just shows up, these non-pursuers of the Dream have corrupted the ideals and spread their poison across the nation. Sometimes I fear that our own Government is culpable in this spread. Certainly the politicians who have fed it and fed off of it are.
The fire still burns. Those who embrace hard work, who believe in the rewards of effort, both physical and mental, material and spiritual will sustain this nation. We pump the lifeblood of commerce, we are the innovators of tomorrow, WE are the caretakers of our brothers. The American Dream is not dead, I think we've just gotten confused about what it is and our responsibility to pursue it.
Honesty of elected officials - Cynic
Belief in the federal reserve system - Cynic
Belief that socialists on the left and evangelicals on the right are too involved in governance - Cynic.
One thing I do believe in though, is the spirit of the American People. More specifically I believe in the American Dream. I'm talking about the American Dream as my parents and my grandparents taught it to me, the Dream that's couched in hard work, and sweat and EARNING a living and BUILDING a better life for yourself and your children. Surpassing your parents and preparing your kids to surpass you. All of this is just as possible today as it was 30 years ago when I learned it, and 30 years before than when my mother was first learning it for the first time.
As I've learned recently, this is not the American Dream that many people know. Some consider the American Dream to be a spiritual quest. Finding satisifaction, be it through material, spiritual, or a strong combination of the two is a noble idea and I think fits within my own meaning.
Some Americans, however, think of the American Dream as what is their due, their right, what is given unto them. These are the habitual bankrupts, the law suit seekers, the lifelong welfare recipients, those who gave up too soon or never bothered to try. The abusers of the system fit this category in all levels of life. From the corrupt police officer or politician, to the teacher who just shows up, these non-pursuers of the Dream have corrupted the ideals and spread their poison across the nation. Sometimes I fear that our own Government is culpable in this spread. Certainly the politicians who have fed it and fed off of it are.
The fire still burns. Those who embrace hard work, who believe in the rewards of effort, both physical and mental, material and spiritual will sustain this nation. We pump the lifeblood of commerce, we are the innovators of tomorrow, WE are the caretakers of our brothers. The American Dream is not dead, I think we've just gotten confused about what it is and our responsibility to pursue it.
Wednesday, July 20, 2011
Ransom Rates May Decline, but Deductions will too...
I'm all for rates going down, but when deductions start to selectively disappear I smell trouble. I haven't seen any detailed releases about the supposed Gang o' Six deal, but don't count on it being a good deal for us super wealthy people who make $250,000 a year and fly corporate jets and own oil companies. The problem is that they won't do it right. Maybe it's a start, but count on these growing pains lasting for another decade at least.
What I think they'll do: A nominal cut in the marginal tax rates, but still leaving better than 40% of Americans not paying any taxes at all; Striking deductions that apply to us tycoons; Cap other deductions (such as the mortgage interest deduction) to an income level that probably can't afford homes; Leave in tax incentives for having large #'s of children you can't afford to raise.
What I'm Afraid this will mean: I'm afraid they'll try to label this as a flat tax, much in the way that the aborted fetus of deregulation was labeled "deregulation of the energy markets" in California. It will not spur growth because it doesn't offset the cuts in deductions with an equal cut in the overall rate of taxation. People will then point to the "flat tax" as a failure.
For years now the government has been trying to determine who wins and who loses in the market by granting favorable tax treatment to offset a lack of market interest. When the market demands energy star appliances, they were built, without government incentives, but when appliance makers lobbied congress, they got tax incentives to help them be more competitive than traditional appliances. Many of these same companies lobbied again, and now the government is mandating that you use a certain type of lightbulb, but we're talking taxes. Tax breaks are given to ethanol producers because they make an inferior product and have to be given subsidies to continue to make it. If ethanol was a product worth producing, their would be plenty of producers willing to do so WITHOUT the government paying them for it. Another great example in the government trying to influence production through tax policy is in the electricity markets. Massive tax subsidies and grants given to producers of wind energy, directives that local resellers of electricity have to use a certain percentage of "green" energy sources have done 1 thing only. Increase the price of electricity for you and for me.
For those interested in this green energy debate, read the excellent op-ed by Robert Kennedy, Jr. in the Wall Street Journal from Monday July 18.
Bottom line, ladies and gentlemen is this: When the government tries to influence the market via tax policy, you should beware. When what they want to support is efficient and/or important enough to you to make you a buyer then you'll become a buyer, but by supporting an inefficient producer, the government doesn't encourage the innovation necessary to make that product successful. In today's environment it's probably more useful to hire a lobbyist than spend that money on R&D.
What I think they'll do: A nominal cut in the marginal tax rates, but still leaving better than 40% of Americans not paying any taxes at all; Striking deductions that apply to us tycoons; Cap other deductions (such as the mortgage interest deduction) to an income level that probably can't afford homes; Leave in tax incentives for having large #'s of children you can't afford to raise.
What I'm Afraid this will mean: I'm afraid they'll try to label this as a flat tax, much in the way that the aborted fetus of deregulation was labeled "deregulation of the energy markets" in California. It will not spur growth because it doesn't offset the cuts in deductions with an equal cut in the overall rate of taxation. People will then point to the "flat tax" as a failure.
For years now the government has been trying to determine who wins and who loses in the market by granting favorable tax treatment to offset a lack of market interest. When the market demands energy star appliances, they were built, without government incentives, but when appliance makers lobbied congress, they got tax incentives to help them be more competitive than traditional appliances. Many of these same companies lobbied again, and now the government is mandating that you use a certain type of lightbulb, but we're talking taxes. Tax breaks are given to ethanol producers because they make an inferior product and have to be given subsidies to continue to make it. If ethanol was a product worth producing, their would be plenty of producers willing to do so WITHOUT the government paying them for it. Another great example in the government trying to influence production through tax policy is in the electricity markets. Massive tax subsidies and grants given to producers of wind energy, directives that local resellers of electricity have to use a certain percentage of "green" energy sources have done 1 thing only. Increase the price of electricity for you and for me.
For those interested in this green energy debate, read the excellent op-ed by Robert Kennedy, Jr. in the Wall Street Journal from Monday July 18.
Bottom line, ladies and gentlemen is this: When the government tries to influence the market via tax policy, you should beware. When what they want to support is efficient and/or important enough to you to make you a buyer then you'll become a buyer, but by supporting an inefficient producer, the government doesn't encourage the innovation necessary to make that product successful. In today's environment it's probably more useful to hire a lobbyist than spend that money on R&D.
Friday, July 15, 2011
Somebody's Going to be Less Well Off
It's impossible. You can't make everyone happy. If you could, we could just have the government make us all millionaires and no one would have to do any work. Sorry, but it doesn't work that way. So, when we have to cut $4-5 trillion in spending, someone is going to be hurt. Sorry Barry. That's just the way it is. Now, just because someone may be hurt by the cuts, does that mean they don't need to happen?
Well, no. We have to prioritize and ask ourselves a fundamental question about fairness. Is it fair to take the fruits of another's labor, by force if necessary, and distribute that to those who have done nothing more than to exist to deserve it? Is the recipient better off receiving that stolen property or would they be better off if you encouraged them to earn their own livelihood? If you took away the incentive to do nothing, would a man in fact, be encouraged to do SOMETHING?
Well, no. We have to prioritize and ask ourselves a fundamental question about fairness. Is it fair to take the fruits of another's labor, by force if necessary, and distribute that to those who have done nothing more than to exist to deserve it? Is the recipient better off receiving that stolen property or would they be better off if you encouraged them to earn their own livelihood? If you took away the incentive to do nothing, would a man in fact, be encouraged to do SOMETHING?
Thursday, July 14, 2011
Everytime a bell rings....
Teacher says that everytime Obama frowns someone succeeds on their own merit.
Wednesday, July 13, 2011
I'm just at a loss here....
I don't understand the mindset that thinks that giving people a disincentive to work, to advance themselves, and to do for themselves is preferable to one where all your basic needs are met without your lifting a damn finger.
When you're teaching a child to take those first steps on their own, you don't go and walk them along, you step away, turn around, and hold out your hands. You encourage the child to take those first steps toward you on their own. When your child learns to ride a bike without training wheels. You may hold onto the bike at first, but then you let go and let them peddle on their own.
And if your child falls down or falls off the bike, do you allow them to give up walking or bike riding for good? No, you keep encouraging them.
Why are we treating our nations poor any differently? Why are we carrying them instead of encouraging them to walk? When you provide luxury housing to the poor, but then take it away as they improve their lives, you encourage them to do nothing. We should be encouraging those who perform, not carrying those who refuse to try.
Hopefully my writer's block is starting to fade, and I'll be getting more posted soon. Until then...
When you're teaching a child to take those first steps on their own, you don't go and walk them along, you step away, turn around, and hold out your hands. You encourage the child to take those first steps toward you on their own. When your child learns to ride a bike without training wheels. You may hold onto the bike at first, but then you let go and let them peddle on their own.
And if your child falls down or falls off the bike, do you allow them to give up walking or bike riding for good? No, you keep encouraging them.
Why are we treating our nations poor any differently? Why are we carrying them instead of encouraging them to walk? When you provide luxury housing to the poor, but then take it away as they improve their lives, you encourage them to do nothing. We should be encouraging those who perform, not carrying those who refuse to try.
Hopefully my writer's block is starting to fade, and I'll be getting more posted soon. Until then...
Tuesday, June 21, 2011
Did You Expect Better??? Really?!?
Haste makes waste. Isn't that the common wisdom our grandparents passed down to us?
It's a simple thing, when you rush a project, you're generally not going to give it your best effort. Corners are cut, things are left out.
When that project is a multi-trillion dollar new entitlement set to re-shape healthcare for the entire nation, haste is a disaster. The bill that was passed was introduced and rushed to a vote with little to no debate in both the house and the senate. Haste in this case, is a nightmare.
http://news.yahoo.com/s/ap/20110621/ap_on_go_ca_st_pe/us_health_overhaul_glitch
It's a simple thing, when you rush a project, you're generally not going to give it your best effort. Corners are cut, things are left out.
When that project is a multi-trillion dollar new entitlement set to re-shape healthcare for the entire nation, haste is a disaster. The bill that was passed was introduced and rushed to a vote with little to no debate in both the house and the senate. Haste in this case, is a nightmare.
http://news.yahoo.com/s/ap/20110621/ap_on_go_ca_st_pe/us_health_overhaul_glitch
Wednesday, June 15, 2011
This is what we can expect from our "Representatives"
It doesn't matter if you're a democrat or a republican. When the rubber meets the road, they're both going to dodge the tough choices. Neither is going to do anything that jeopardizes their chances to get re-elected. Not because what they do is popular to the majority, but because it's popular to the ones who spend the most money. Another big lobby just got its wish.
The Republican controlled House has killed a bill that would have cut down money wasting farm subsidies while the Democrat controlled Senate has killed a similar measure that would have cut off subsidies for ethanol.
Over $100 million in wasteful spending will continue. when you consider that we're going to have to borrow close to $60 million to pay for these subsidies and that the net effect is to artificially keep the price of food high, then you can see the great service our elected representatives of both parties have done for us.
We don't have a lot of power here, at least not as individuals. If we as the People don't hold our elected representatives to account, why should they do any differently? Everyone likes the ideas of "voting the bums out" except when it comes to THEIR bum, because he brings home the bacon. Well, your bacon and my bacon and everyone else's bacon has finally clogged the arteries of this country.
For more information on the wonderful world of farm subsidies, consider this Heritage Foundation article.
The Republican controlled House has killed a bill that would have cut down money wasting farm subsidies while the Democrat controlled Senate has killed a similar measure that would have cut off subsidies for ethanol.
Over $100 million in wasteful spending will continue. when you consider that we're going to have to borrow close to $60 million to pay for these subsidies and that the net effect is to artificially keep the price of food high, then you can see the great service our elected representatives of both parties have done for us.
We don't have a lot of power here, at least not as individuals. If we as the People don't hold our elected representatives to account, why should they do any differently? Everyone likes the ideas of "voting the bums out" except when it comes to THEIR bum, because he brings home the bacon. Well, your bacon and my bacon and everyone else's bacon has finally clogged the arteries of this country.
For more information on the wonderful world of farm subsidies, consider this Heritage Foundation article.
Wednesday, June 8, 2011
This is why we have revolutions...
An SS like team, dispatched by, of all the bureaucracies, the Department of Education, raids a home, confines a man separately from his children in a hot patrol car for 6 hours beginning at 6AM.
Why? They're searching for his estranged wife because she's delinquent on her Student Loans.
It's apparently harder to get a no-knock warrant for a drug dealer's den than it is for the Dept of Ed to get one for a dead-beat student borrower.
One day they're going to bust down the door of an armed man, and that armed man will justifiably shoot the invading Soldiers and become the first martyr in a revolution. Right now I'm too angry to write more, back soon.
Why? They're searching for his estranged wife because she's delinquent on her Student Loans.
It's apparently harder to get a no-knock warrant for a drug dealer's den than it is for the Dept of Ed to get one for a dead-beat student borrower.
One day they're going to bust down the door of an armed man, and that armed man will justifiably shoot the invading Soldiers and become the first martyr in a revolution. Right now I'm too angry to write more, back soon.
Tuesday, June 7, 2011
Why Lie?
If your economic successes are so great, why do you have to stretch the truth or outright lie about it?
http://www.washingtonpost.com/blogs/fact-checker/post/president-obamas-phony-accounting-on-the-auto-industry-bailout/2011/06/06/AG3nefKH_blog.html
It happens all the time. Politicians, marketers, etc. If what you're trying to convince us of is so wonderful, quit with the gimmicks. Lay it on us straight.
Shit, I'd like you to play me straight even when the news is dire.
Joe Wilson had to apologize for telling it like it is when he yelled "You Lie!" In my opinion, the only mistake he made is that he directed it at the President alone. He left out the House, Senate, and himself.
http://www.washingtonpost.com/blogs/fact-checker/post/president-obamas-phony-accounting-on-the-auto-industry-bailout/2011/06/06/AG3nefKH_blog.html
It happens all the time. Politicians, marketers, etc. If what you're trying to convince us of is so wonderful, quit with the gimmicks. Lay it on us straight.
Shit, I'd like you to play me straight even when the news is dire.
Joe Wilson had to apologize for telling it like it is when he yelled "You Lie!" In my opinion, the only mistake he made is that he directed it at the President alone. He left out the House, Senate, and himself.
Friday, June 3, 2011
Could you have a worse name for a scandal like this?
WeinerGate? I'm not sure if they're talking about the man or the subject matter of the photo he allegedly tweeted to a young woman. If he's the victim of a hoax then I feel bad for him. Something tells me though, that the Weiner is in deep....trouble.
Wednesday, June 1, 2011
What Happens When You Support the Ends, but Not the Means?
I'm all for having more information. I think the more information we have, in general, allows us to make better choices. There are, of course, exceptions. A series of PSA's in the 90's was titled "The More You Know..." and I think that the overall theme was good. The more information you have on a subject, the better conclusions you can reach.
But what am I talking about? Does it matter? As an example, take Health and Nutrition:
I think that everyone who sells and serves food should post the nutritional information about that food on their menus. I think that the additional information will help us make better choices and I think that if enough people agreed with me and demanded it of the Market, the Market would provide it. The people, however, have taken a different path. They have chosen a different means to that agreed upon end. Laws are so much easier to shift than markets it seems. It's not OUR freedoms that are being abridged and we even benefit. Now, if you oppose the means you must also oppose the ends.
But what am I talking about? Does it matter? As an example, take Health and Nutrition:
I think that everyone who sells and serves food should post the nutritional information about that food on their menus. I think that the additional information will help us make better choices and I think that if enough people agreed with me and demanded it of the Market, the Market would provide it. The people, however, have taken a different path. They have chosen a different means to that agreed upon end. Laws are so much easier to shift than markets it seems. It's not OUR freedoms that are being abridged and we even benefit. Now, if you oppose the means you must also oppose the ends.
Monday, May 23, 2011
Israel Deserves Better Treatment by Her Friends
Peace in the Middle East is a lofty goal. Left to make it's own choices on the subject, Israel would have had Peace since 1950. Instead, she was invaded from almost every border almost from the day the country was reconceived in the modern world. In the end of several of these conflicts Israel, the defending victor, seized the lands of its aggressive neighbors, trying to build a buffer zone against new assaults.
By all rights, these lands now belong to Israel and have for 44 years.
There is a lot that has gone into the negotiations with the various factions that have sought Israel's distruction for the better part of the last 60 years, but one thing has stood out. Israel has never been willing to give up that which it's sons and daughters died to win, that buffer zone.
So, when Her closest ally on Friday suddenly changes position to support the idea of Israel going back to the 1967 borders, that is a slap in the face. Expediency should not come before Right. Appeasing terrorists should not replace Justice. Shame on you, Mr. president.
By all rights, these lands now belong to Israel and have for 44 years.
There is a lot that has gone into the negotiations with the various factions that have sought Israel's distruction for the better part of the last 60 years, but one thing has stood out. Israel has never been willing to give up that which it's sons and daughters died to win, that buffer zone.
So, when Her closest ally on Friday suddenly changes position to support the idea of Israel going back to the 1967 borders, that is a slap in the face. Expediency should not come before Right. Appeasing terrorists should not replace Justice. Shame on you, Mr. president.
Thursday, May 12, 2011
Education in America
What's your motivation? As we've discussed before, the incentive concept is what I believe drives our lives. For teachers' unions the motivation is the best hand for the teacher. Teachers provide members, money, clout. For the politician who takes union money, who needs union support to keep his job, the motivation is essentially the same. He needs the union who needs the teachers, so it is the teacher who comes out ahead. Who represents the students?
A former head of the United Federation of Teachers once famously said "When school children start paying union dues, that's when I'll start representing the interests of school children." Albert Shanker wasn't far off the mark there.
Reforming how teachers are hired and fired is an essential part of reforming education. You can't fix a system using the same faulty parts. People much smarter than I have tried and some have succeeeded in adding better parts to fix the whole, but unless you reform the HOW the parts work, you can't fix the system. Consider this op-ed from the New York Post by Joel Klein, who oversaw one of the greatest increases in public school performance in this country.
http://www.nypost.com/p/news/opinion/opedcolumnists/keeping_great_teachers_tXMzZhQwLz3rfNVOma4xAO
More recommended reading of Mr. Klein was in the May 9, 2011 Wall Street Journal.
Bottom line on this aspect of this topic is this:
If we don't represent the interests of our students, if we don't hire and fire based on merit alone, if we continue to put the needs of the worthless above the needs of those we serve then our educational system will continue to decline. As that decline spreads, so does the decline of this nation of ours.
A former head of the United Federation of Teachers once famously said "When school children start paying union dues, that's when I'll start representing the interests of school children." Albert Shanker wasn't far off the mark there.
Reforming how teachers are hired and fired is an essential part of reforming education. You can't fix a system using the same faulty parts. People much smarter than I have tried and some have succeeeded in adding better parts to fix the whole, but unless you reform the HOW the parts work, you can't fix the system. Consider this op-ed from the New York Post by Joel Klein, who oversaw one of the greatest increases in public school performance in this country.
http://www.nypost.com/p/news/opinion/opedcolumnists/keeping_great_teachers_tXMzZhQwLz3rfNVOma4xAO
More recommended reading of Mr. Klein was in the May 9, 2011 Wall Street Journal.
Bottom line on this aspect of this topic is this:
If we don't represent the interests of our students, if we don't hire and fire based on merit alone, if we continue to put the needs of the worthless above the needs of those we serve then our educational system will continue to decline. As that decline spreads, so does the decline of this nation of ours.
Tuesday, May 10, 2011
Why Do We Allow This NONSENSE!?
Picture this scene. You're taking your kids on vacation. For your two youngest, ages 6 and 3, it's their first trip on an airplane. As you proceed through security checkpoints, your children are pulled aside by a 30 something year old stranger with a disgruntled look. This man then proceeds to feel up the legs and cup the butt of your children.
Pedophiles come in all shapes and sizes and work for all types of organizations. If you think they aren't in the TSA you're an idiot. If you wouldn't stand for this type of conduct toward your own children, why are you willing to ignore it when it's someone else's kid that this happened to? There are laws against inappropriate touching of a minor, it's time they were enforced.
If law enforcement doesn't step in, some angry parent will and then the wrong person will be going to jail.
Pedophiles come in all shapes and sizes and work for all types of organizations. If you think they aren't in the TSA you're an idiot. If you wouldn't stand for this type of conduct toward your own children, why are you willing to ignore it when it's someone else's kid that this happened to? There are laws against inappropriate touching of a minor, it's time they were enforced.
If law enforcement doesn't step in, some angry parent will and then the wrong person will be going to jail.
Monday, May 9, 2011
What You Won't Hear on the News Tonight...
Federal and State Tax revenues are increasing.
I don't know why anyone is surprised. Maintaining lower tax rates, instead of raising them, has encouraged people to engage in business activities that produce tax revenue instead of working to avoid it. You never hear this news when taxes fail to go up. Partially government accounting is to blame. When tax cuts are seen as expenditures and increased revenues are seen as a means to spend more, then an increase in revenue due to lower tax cuts must be brushed under the rug.
In other news Private payrolls continue to expand, not surprising now that unemployment benefits are allowed to wind down. Also not surprising is that more people are re-entering the work force, thereby increasing the official unemployment rate. Unofficially and more accurately, unemployment is still somewhere closer to 15% than the 9% currently reported. The discrepancy comes from the fact that the "official" number doesn't factor in people who have stopped looking, taken early retirement, or have taken low paying jobs now that unemployment has run out.
Hopefully, this increased revenue gets used to reduce our deficits and pay down debt rather than provide an incentive for our government to go on another debt fueled binge.
I don't know why anyone is surprised. Maintaining lower tax rates, instead of raising them, has encouraged people to engage in business activities that produce tax revenue instead of working to avoid it. You never hear this news when taxes fail to go up. Partially government accounting is to blame. When tax cuts are seen as expenditures and increased revenues are seen as a means to spend more, then an increase in revenue due to lower tax cuts must be brushed under the rug.
In other news Private payrolls continue to expand, not surprising now that unemployment benefits are allowed to wind down. Also not surprising is that more people are re-entering the work force, thereby increasing the official unemployment rate. Unofficially and more accurately, unemployment is still somewhere closer to 15% than the 9% currently reported. The discrepancy comes from the fact that the "official" number doesn't factor in people who have stopped looking, taken early retirement, or have taken low paying jobs now that unemployment has run out.
Hopefully, this increased revenue gets used to reduce our deficits and pay down debt rather than provide an incentive for our government to go on another debt fueled binge.
Friday, May 6, 2011
Can't Buy Me Love
The Beatles sang about it. Later, Dr. McDreamy as he's now known, acted it out on the big screen, and now, Pakistan has proven it.
First, a show of hands. How many people actually believe that the Pakistani's had no idea that Osama (Usama) bin Laden was living in a fortified compound right next to their equivalent of West Point? Over the last 10 years we have dumped billions of dollars into Pakistan, billions of dollars we didn't have, billions of dollars we borrowed. What has this money bought us? NOTHING. It bought us a few low level operatives, and a warm glow maybe, but in the grand scheme, when we wanted to get something done, we still had to do it ourselves.
Our money! Our tax dollars and the tax dollars of future generations of Americans paid for this "ally" to become more of a militarily run nation, assassinate one of the only voices of reform, and the harboring of our primary target in the War on Terror. And you wonder why I have such disdain for government spending. It's the height of stupidity to continue to give these people money. We will. Our government has the remarkable ability to self delude, to try to cover up mistakes with more mistakes, throwing more borrowed money at someone else's problem.
We can't buy the love of the world. First it doesn't work and second because we simply can't afford it. Countries will gladly take our money, then spit in our eye. It's like giving money to a beggar on the street and then finding out he's stolen your wallet. In this case Pakistan is a bum we've been giving money to only to find out that he's broken into our car and stolen our radio.
First, a show of hands. How many people actually believe that the Pakistani's had no idea that Osama (Usama) bin Laden was living in a fortified compound right next to their equivalent of West Point? Over the last 10 years we have dumped billions of dollars into Pakistan, billions of dollars we didn't have, billions of dollars we borrowed. What has this money bought us? NOTHING. It bought us a few low level operatives, and a warm glow maybe, but in the grand scheme, when we wanted to get something done, we still had to do it ourselves.
Our money! Our tax dollars and the tax dollars of future generations of Americans paid for this "ally" to become more of a militarily run nation, assassinate one of the only voices of reform, and the harboring of our primary target in the War on Terror. And you wonder why I have such disdain for government spending. It's the height of stupidity to continue to give these people money. We will. Our government has the remarkable ability to self delude, to try to cover up mistakes with more mistakes, throwing more borrowed money at someone else's problem.
We can't buy the love of the world. First it doesn't work and second because we simply can't afford it. Countries will gladly take our money, then spit in our eye. It's like giving money to a beggar on the street and then finding out he's stolen your wallet. In this case Pakistan is a bum we've been giving money to only to find out that he's broken into our car and stolen our radio.
The Haves and The Have Nots
We frequently hear the refrain that the distance is growing between the haves and the have nots, that the income gap is widening, that the rich are getting richer while the poor are getting poorer. One word can sum up my response. "Duh." Yes, the rich get richer. The poor often do not get that much poorer, however the growth of income for the poor is far far lower than it is for the rich. That has more relation to the power of money to attract money and the ability to risk more to earn more. Not my topic.
No, what I want to discuss is a topic that has been near to my heart since I was a child. The ability to break the cycle, to grow out of your caste and why it's so rare that this happens. Part of the discussion is psychology and as this is not my forte, I will leave it to my own experiences. The rest revolves around our education system and ideas to improve.
First, if you haven't seen "Waiting for Superman," I highly encourage you to do so.
It is clear to me that for the vast majority of people, a decent education opens the doors to a greater chance for success in life. In too many of our school districts, that is hard to come by. For many others, regardless of the quality of the education offered to them, there is no drive to achieve. Instead we find an indifference towards self-improvement that is quite honestly, appalling to me. Most of that starts in the home. There was never a question of whether or not I would finish high school or go to college. It was ASSUMED. My family was not rich, in fact, we were not even upper middle class. My parents couldnt' afford to pay college tuition out of pocket. Still, there was no question. In other homes, there is a hope to finish high school and go to college, and I think that the children in those home benefit from that desire, be it their own or their parents. Yet, in too many homes in this country there is no desire, no hope, no expectation.
Education starts at home, or so the saying goes. This may very well be true, but if we are to turn this tide, shift this imbalance and get our whole nation up to an educational minimum standard that we can, as a society, accept, then we have to act in a way that we can. We can't overturn years of inertia in the home. Maybe we can do it in schools.
Last year, due to teacher layoffs, Indiana fired it's current Teacher of the Year. Obviously this young teacher had not performed poorly. No, the problem was that she was too new. The older teachers, protected by tenure and a policy of last in, first out were exempted from the layoffs. This is just one illustration among many across the country. Other problems persist as well. Poor students are trapped in underperforming schools or school districts due to their geography. Schools in poor neighborhoods are often more dangerous, exposed to drug dealings and violent crimes. Good teachers don't want to teach in many schools due to threats, vandalism, and lower pay.
So, what are some answers? I don't know. What I do know is that politicians have thrown dollar after dollar at the issue for years, with no discernible result. Spending per student has risen at greater than the rate of inflation for more than 30 years, while performance compared to the rest of the industrialized world has slid. If money is not the answer, what is? Personally, I think it's freedom and empowerment and a healthy dose of good old fashion market competition.
Chew on that and we'll discuss this in greater length next week.
No, what I want to discuss is a topic that has been near to my heart since I was a child. The ability to break the cycle, to grow out of your caste and why it's so rare that this happens. Part of the discussion is psychology and as this is not my forte, I will leave it to my own experiences. The rest revolves around our education system and ideas to improve.
First, if you haven't seen "Waiting for Superman," I highly encourage you to do so.
It is clear to me that for the vast majority of people, a decent education opens the doors to a greater chance for success in life. In too many of our school districts, that is hard to come by. For many others, regardless of the quality of the education offered to them, there is no drive to achieve. Instead we find an indifference towards self-improvement that is quite honestly, appalling to me. Most of that starts in the home. There was never a question of whether or not I would finish high school or go to college. It was ASSUMED. My family was not rich, in fact, we were not even upper middle class. My parents couldnt' afford to pay college tuition out of pocket. Still, there was no question. In other homes, there is a hope to finish high school and go to college, and I think that the children in those home benefit from that desire, be it their own or their parents. Yet, in too many homes in this country there is no desire, no hope, no expectation.
Education starts at home, or so the saying goes. This may very well be true, but if we are to turn this tide, shift this imbalance and get our whole nation up to an educational minimum standard that we can, as a society, accept, then we have to act in a way that we can. We can't overturn years of inertia in the home. Maybe we can do it in schools.
Last year, due to teacher layoffs, Indiana fired it's current Teacher of the Year. Obviously this young teacher had not performed poorly. No, the problem was that she was too new. The older teachers, protected by tenure and a policy of last in, first out were exempted from the layoffs. This is just one illustration among many across the country. Other problems persist as well. Poor students are trapped in underperforming schools or school districts due to their geography. Schools in poor neighborhoods are often more dangerous, exposed to drug dealings and violent crimes. Good teachers don't want to teach in many schools due to threats, vandalism, and lower pay.
So, what are some answers? I don't know. What I do know is that politicians have thrown dollar after dollar at the issue for years, with no discernible result. Spending per student has risen at greater than the rate of inflation for more than 30 years, while performance compared to the rest of the industrialized world has slid. If money is not the answer, what is? Personally, I think it's freedom and empowerment and a healthy dose of good old fashion market competition.
Chew on that and we'll discuss this in greater length next week.
Monday, May 2, 2011
Osama Bin Laden Dead
Yes, he could have been dead more than a month ago, but bombing a compound where we're told he is is much messier than going in and getting him. I think it was probably the right decision. One of the only right decisions our president has made in his term. Major thanks goes out to all of the spooks, interrogators and military and civilian intelligence agencies that made this intel possible (even if they did have to dunk someone's head to get it) and especially to our Special Forces (Go Seals!) who went in and did the job.
Burial at sea, within 24 hours, so let the conspiracy theorists begin!
Burial at sea, within 24 hours, so let the conspiracy theorists begin!
Friday, April 29, 2011
How Far Fetched Is It Really?
One of the central themes of Ayn Rand's Atlas Shrugged is the constant interference of government in normal operations of businesses. From the government passing laws to restrict outputs, to laws restricting movement and relocation of companies. When I first read the book 16 or 17 years ago I too thought that it was pretty far fetched. That was before I knew about agricultural subsidies, corporate tax breaks aimed at boosting specific industries (and effectively limiting others) and the latest decision out of the National Labor Relations Board.
So, Boeing has a new plane, and to build this new plane, they decide to open a new facility, not right next door in Washington State, but clear across the country in South Carolina. Obviously this is a menace. Completely unfair to the poor Boeing workers in Washington who are now out of work. But no, Boeing isn't laying anyone off in Washington. That plant is still fully operational. So, what's the problem? The problem is is that Boeing's employees in Washington are part of a union, and if you want to work for Boeing in Washington, you HAVE TO join this union. The employees in South Carolina CAN join that union if they wish, but they are not REQUIRED to do so. Well, that's clearly a violation of the ummmm, the uhhhh, well gosh darn it, it's just not fair.
No, I'll tell you what's not fair. What's not fair is a law that forces an individual to join a union in order to get a job with a company that is in an antagonistic (by design) relationship with said union, then compels dues be paid to said union. Unions require majority support to be formed. If they have that support they should be forced to maintain that support in order to stay. If you can't convince enough people to voluntarily pay your dues, you can't operate. They would have to better serve their constituencies to survive. No, you're right. Compulsion works better. Makes life easier.
What's not fair is an unelected federal agency mandating where a company can do business, where it can hire employees. The argument is that this is just another way to bust a union. Again, no unions are being busted, they just have to earn the loyalty of new employees, give them a return for their hard earned investment. If you can only exist by forced payments once you're establish then maybe you shouldn't exist.
So, Boeing has a new plane, and to build this new plane, they decide to open a new facility, not right next door in Washington State, but clear across the country in South Carolina. Obviously this is a menace. Completely unfair to the poor Boeing workers in Washington who are now out of work. But no, Boeing isn't laying anyone off in Washington. That plant is still fully operational. So, what's the problem? The problem is is that Boeing's employees in Washington are part of a union, and if you want to work for Boeing in Washington, you HAVE TO join this union. The employees in South Carolina CAN join that union if they wish, but they are not REQUIRED to do so. Well, that's clearly a violation of the ummmm, the uhhhh, well gosh darn it, it's just not fair.
No, I'll tell you what's not fair. What's not fair is a law that forces an individual to join a union in order to get a job with a company that is in an antagonistic (by design) relationship with said union, then compels dues be paid to said union. Unions require majority support to be formed. If they have that support they should be forced to maintain that support in order to stay. If you can't convince enough people to voluntarily pay your dues, you can't operate. They would have to better serve their constituencies to survive. No, you're right. Compulsion works better. Makes life easier.
What's not fair is an unelected federal agency mandating where a company can do business, where it can hire employees. The argument is that this is just another way to bust a union. Again, no unions are being busted, they just have to earn the loyalty of new employees, give them a return for their hard earned investment. If you can only exist by forced payments once you're establish then maybe you shouldn't exist.
Thursday, April 28, 2011
What Would You Do?
ABC does a new magazine show every so often, asking this question, posing situations for people to intervene. Maybe they should consider this for an Extreme Edition of their show. Several incidents recently where a person in real physical distress and the best reaction from a crowd of on-lookers is to pull out a camera phone and record it. No one steps in, no one breaks up a fight, or cares for a dying man.
What's happening in this country is that we are afraid. Afraid of stepping up or stepping in when it's not our fight, not our problem. You feel bad. Someone should step in. Are you someone? But the physical danger! But I could get sued!
I don't have solutions, I don't know what I would do. I hope I would retain enough humanity to do something to help my fellow man. What I do know is that there are too many cases of people walking away from situations where they can help and enough situations of trying to help coming back to haunt a good samaritan to make it understandable.
We are or should be free to help as we choose, when we choose. I hope I make the right choice.
What's happening in this country is that we are afraid. Afraid of stepping up or stepping in when it's not our fight, not our problem. You feel bad. Someone should step in. Are you someone? But the physical danger! But I could get sued!
I don't have solutions, I don't know what I would do. I hope I would retain enough humanity to do something to help my fellow man. What I do know is that there are too many cases of people walking away from situations where they can help and enough situations of trying to help coming back to haunt a good samaritan to make it understandable.
We are or should be free to help as we choose, when we choose. I hope I make the right choice.
Tuesday, April 26, 2011
Let's Blame the Unicorn
Did you know that supply and demand, that fundamental principle of economics, applies to dollars the same way it applies to cars, gas, oil, corn, and every other for sale item in the world? What makes it different is that since dollars are the basis by which we operate our barter economy, the price of the dollar effects the price of everything we buy with dollars.
It may not seem like it in this recession, but there are more dollars floating around now than there were 15 years ago. A lot more dollars. As the supply of dollars has gone up, the value or price of the dollars has dropped. The supply didn't go up to meet some strong demand for dollars, in fact, the supply started moving rapidly up when the demand for dollars began to diminish during the world-wide recession. This wasn't an accident. The Federal Reserve created these new dollars on purpose. Creating the money helped to provide liquidity to the financial institutions during a time of crisis. This was the second part of the bank bailout, the one no one talks about.
What does this mean for the average person? Well, when your dollar is worth less (not worthless just yet) then things you buy with dollars require more of them. Prices go up. We talked about this the other day, despite the fed's assertions that core inflation is nothing to worry about, they've excluded food and fuel from the "core" numbers.
No one is admitting that this is a problem yet. Obama is looking at the greedy speculators (ie commodities investors who are betting that the price of oil will go up) and big bad oil companies. The oil companies are demonized for getting taxpayer subsidies. (quick aside - These big subsidies are essentially the same as allowing a small business person to write off the expenses of purchasing new equipment or hiring new employees from their gross income and are not as blatant a subsidy as giving a tax credit to GE or Whirlpool for manufacturing a product that they sell for a profit. Oil companies spend a LOT of money looking for oil, paying surveyors, landowners, geologists and then for exploratory wells, the "subsidies for big oil" allow them to expense these)
Other people blame the "free market" for this "non-core" inflation. This one always gets me. I have been looking for a "free market" for years. It doesn't exist. Our markets are so heavily regulated that to even reference them as "free" makes Adam Smith roll over in his grave. We do the best we can with the markets as we have them, but don't make the mistake of thinking that they're free. You show me a FREE market that causes this runaway inflation and I'll fly to your house on a Pegasus. Next time you hear someone say "the free market system has failed" ask them if it was the market or could one of the many layers of burdensome and inefficient regulations overlaying our markets have impacted that failure in any way?
It may not seem like it in this recession, but there are more dollars floating around now than there were 15 years ago. A lot more dollars. As the supply of dollars has gone up, the value or price of the dollars has dropped. The supply didn't go up to meet some strong demand for dollars, in fact, the supply started moving rapidly up when the demand for dollars began to diminish during the world-wide recession. This wasn't an accident. The Federal Reserve created these new dollars on purpose. Creating the money helped to provide liquidity to the financial institutions during a time of crisis. This was the second part of the bank bailout, the one no one talks about.
What does this mean for the average person? Well, when your dollar is worth less (not worthless just yet) then things you buy with dollars require more of them. Prices go up. We talked about this the other day, despite the fed's assertions that core inflation is nothing to worry about, they've excluded food and fuel from the "core" numbers.
No one is admitting that this is a problem yet. Obama is looking at the greedy speculators (ie commodities investors who are betting that the price of oil will go up) and big bad oil companies. The oil companies are demonized for getting taxpayer subsidies. (quick aside - These big subsidies are essentially the same as allowing a small business person to write off the expenses of purchasing new equipment or hiring new employees from their gross income and are not as blatant a subsidy as giving a tax credit to GE or Whirlpool for manufacturing a product that they sell for a profit. Oil companies spend a LOT of money looking for oil, paying surveyors, landowners, geologists and then for exploratory wells, the "subsidies for big oil" allow them to expense these)
Other people blame the "free market" for this "non-core" inflation. This one always gets me. I have been looking for a "free market" for years. It doesn't exist. Our markets are so heavily regulated that to even reference them as "free" makes Adam Smith roll over in his grave. We do the best we can with the markets as we have them, but don't make the mistake of thinking that they're free. You show me a FREE market that causes this runaway inflation and I'll fly to your house on a Pegasus. Next time you hear someone say "the free market system has failed" ask them if it was the market or could one of the many layers of burdensome and inefficient regulations overlaying our markets have impacted that failure in any way?
Friday, April 22, 2011
But The Critics Gave it Bad Reviews!
A friend of mine, trying to ridicule the movie (without having seen it or having any interest in seeing it), pointed out that "Rotten Tomatoes" gave this movie it's worst ever critics rating. OH NO! Not the CRITI CS! Those same critics gave The Piano excellent reviews, and let's not get me started there. The same site acknowledges that closer to 90% of those who have seen it loved it.
Finally, my review of Part 1 of the movie adaptation of Ayn Rand's capitalist opus, Atlas Shrugged.
Having recently finished my first re-read of this book in 17 years, I wanted to be certain to see this movie opening weekend. It's not the most masterfully written book. The dialogue doesn't flow. It's exaggerated to make a point. It was DESIGNED to make that point, and did it ever.
Having actually read the early reviews I didn't have high expectations regarding the acting, cinematography, etc. To say I was pleasantly surprised is an understatement. It was actually very well presented. The acting was a notch above ABC Family, but since I expected OWN or Lifetime, this was a big improvement. As the movie moved along the acting actually improved. Like watching a play on opening night where the actors are a bit tense, but as the play progresses they relax and let the rehearsals and practice carry them through. Hell, even the score was well done.
Having said all of that, let me now say, it didn't matter. It could have been acted by sock puppets and had they kept the message intact it would have been wonderful. They kept the message intact. What is the message though? Some people, I fear, have mistaken it. The message is not "Only those super-successful producers of the world are important." Far from it. The point of the movie, of the book, the underlying message is to be the best producer you can be, in whatever productive capacity you can find and fill, not for the benefit of society, not for your family and especially not for your Government. Do it for the love of yourself and be proud of it.
I want to encourage all of you, go out and see this movie. It started out in only 300 theaters and will be expanded to 1000 or more by the end of May. Go see the movie. I believe you will be glad you did.
Finally, my review of Part 1 of the movie adaptation of Ayn Rand's capitalist opus, Atlas Shrugged.
Having recently finished my first re-read of this book in 17 years, I wanted to be certain to see this movie opening weekend. It's not the most masterfully written book. The dialogue doesn't flow. It's exaggerated to make a point. It was DESIGNED to make that point, and did it ever.
Having actually read the early reviews I didn't have high expectations regarding the acting, cinematography, etc. To say I was pleasantly surprised is an understatement. It was actually very well presented. The acting was a notch above ABC Family, but since I expected OWN or Lifetime, this was a big improvement. As the movie moved along the acting actually improved. Like watching a play on opening night where the actors are a bit tense, but as the play progresses they relax and let the rehearsals and practice carry them through. Hell, even the score was well done.
Having said all of that, let me now say, it didn't matter. It could have been acted by sock puppets and had they kept the message intact it would have been wonderful. They kept the message intact. What is the message though? Some people, I fear, have mistaken it. The message is not "Only those super-successful producers of the world are important." Far from it. The point of the movie, of the book, the underlying message is to be the best producer you can be, in whatever productive capacity you can find and fill, not for the benefit of society, not for your family and especially not for your Government. Do it for the love of yourself and be proud of it.
I want to encourage all of you, go out and see this movie. It started out in only 300 theaters and will be expanded to 1000 or more by the end of May. Go see the movie. I believe you will be glad you did.
Thursday, April 21, 2011
To Govern vs To Rule - Battle of the Verbs
NEWS FLASH!
Words Have Meaning!
When you're talking to your friends, as I know you often do, about the Government, state, local or federal, you probably don't often refer to them as our rulers. Are they our Government or are they our rulers. Just the visceral reaction in the pit of my stomach at the thought of having a ruler tells me that there is a distinction. Webster doesn't see a lot of difference. The definition of the two words are strikingly similar. So, why don't we use them interchangeably when referencing our Rulers, errrr, Government.
Think about this: What does government mean to you? How do you want to be governed? Do you want someone telling you how you HAVE to raise your kids, run your business, how much of your money you have to give to those less fortunate? Or do you think, well, I'm going to do it right anyway, but someone should tell those other people how they have to act right? What happens when the consensus turns against something you believe in? What happens when they want to make YOU act right? How much intrusion is too much?
Sometimes you have to stand for Freedom even when you agree with the latest rule.
Do you too get that feeling in the pit of your stomach thinking about being "ruled?" Here's what we have to do:
Stand up and get involved. Get educated. Look past the numbers you are given. Trust reason before passion and right over need. Be the best producer you can be, not for the sake of the looters, but for your own benefit.
Words Have Meaning!
When you're talking to your friends, as I know you often do, about the Government, state, local or federal, you probably don't often refer to them as our rulers. Are they our Government or are they our rulers. Just the visceral reaction in the pit of my stomach at the thought of having a ruler tells me that there is a distinction. Webster doesn't see a lot of difference. The definition of the two words are strikingly similar. So, why don't we use them interchangeably when referencing our Rulers, errrr, Government.
Think about this: What does government mean to you? How do you want to be governed? Do you want someone telling you how you HAVE to raise your kids, run your business, how much of your money you have to give to those less fortunate? Or do you think, well, I'm going to do it right anyway, but someone should tell those other people how they have to act right? What happens when the consensus turns against something you believe in? What happens when they want to make YOU act right? How much intrusion is too much?
Sometimes you have to stand for Freedom even when you agree with the latest rule.
Do you too get that feeling in the pit of your stomach thinking about being "ruled?" Here's what we have to do:
Stand up and get involved. Get educated. Look past the numbers you are given. Trust reason before passion and right over need. Be the best producer you can be, not for the sake of the looters, but for your own benefit.
Wednesday, April 20, 2011
Playing With Numbers
Numbers tell us a lot about our world. Statistics, the study of finding meaning behind the numbers, can give us information about a variety of topics. Like many things that are both manipulable and trusted, statistics can be used to manipulate how we view our world. About 10 years ago, a joke email went about trying to explain how statistics can be used to lead you to draw a wrong conclusion. First it pointed out that 90% + of violent crimes were committed within 48 hours of the perpetrator eating bread. Without pointing out that 90% + of the general population consumes bread at least once every 48 hours it drew the conclusion, obvious with the information presented, that eating bread is a cause of violent crime.
How has this worked recently in the real world? Well, back in 1979 annual inflation reached 10.75%. Then in 1980 the government changed how they measured inflation. How did they do this? By removing key components from the numbers. Why did they do it? The cynic in me says they did it to hide trouble from the nation. It could be because they wanted to alleviate a scare in the public, that these other factors weren't critical to everyday life. Think deeper though. What costs to the government rise associated with inflation? The 800 lb gorilla sitting on our government...Social Security. A new measurement that reduces inflation also reduces the cost of living adjustments to social security recipients. To be honest, this move probably prolonged the social security system by 20 years. Ok, that was 30 years ago. Aaaah, but the deception continues to this day. Have you noticed the price of food creeping up over the last year? You may not have. Companies are really good at hiding inflation they same way they're good at hiding cost increases in a recession. For instance, a few years ago you could buy a 20oz soda for 99 cents. Well, now that 99 cents will get you a soda that looks the same, but is in fact, only 16 oz. Don't worry, they still sell that 20 oz soda, but it costs $1.59 now. Cereal that came in a 32 oz box now comes in 26 for the same price. The box looks identical. The contents are not. Meanwhile, our government tells us that inflation is within normal range of 2.7%. Using the same measurement that the government used in 1979, however, it's not. It's 9.7% or higher.
What should you do? I don't know. I don't give investment advice. I personally believe that investing without a hedge against inflation is foolish. We've often, as a society, made a show of demanding transparency, but done little when that demand is either flat out rejected or when we're given numbers that have no real meaning. So, what should you do? When a politician tells you that he's cut $38.5 billion from the budget, asks him why that $38.5 billion cut only reduced our deficit by $350 million. When you're told that inflation isn't a cause for concern, ask why your dollar doesn't buy as many Apple Jacks as it did 6 months ago.
Numbers don't lie. You've probably heard that expression. It's a paradox. While it's true, it will cause you to believe a falsehood. Number's don't lie, but they can be made to deceive you. Look behind the numbers. The real truth is likely in the small print.
Working on a new post already, pondering the question between the difference in two verbs: govern and rule. Which did we consent to? Which are we receiving?
How has this worked recently in the real world? Well, back in 1979 annual inflation reached 10.75%. Then in 1980 the government changed how they measured inflation. How did they do this? By removing key components from the numbers. Why did they do it? The cynic in me says they did it to hide trouble from the nation. It could be because they wanted to alleviate a scare in the public, that these other factors weren't critical to everyday life. Think deeper though. What costs to the government rise associated with inflation? The 800 lb gorilla sitting on our government...Social Security. A new measurement that reduces inflation also reduces the cost of living adjustments to social security recipients. To be honest, this move probably prolonged the social security system by 20 years. Ok, that was 30 years ago. Aaaah, but the deception continues to this day. Have you noticed the price of food creeping up over the last year? You may not have. Companies are really good at hiding inflation they same way they're good at hiding cost increases in a recession. For instance, a few years ago you could buy a 20oz soda for 99 cents. Well, now that 99 cents will get you a soda that looks the same, but is in fact, only 16 oz. Don't worry, they still sell that 20 oz soda, but it costs $1.59 now. Cereal that came in a 32 oz box now comes in 26 for the same price. The box looks identical. The contents are not. Meanwhile, our government tells us that inflation is within normal range of 2.7%. Using the same measurement that the government used in 1979, however, it's not. It's 9.7% or higher.
What should you do? I don't know. I don't give investment advice. I personally believe that investing without a hedge against inflation is foolish. We've often, as a society, made a show of demanding transparency, but done little when that demand is either flat out rejected or when we're given numbers that have no real meaning. So, what should you do? When a politician tells you that he's cut $38.5 billion from the budget, asks him why that $38.5 billion cut only reduced our deficit by $350 million. When you're told that inflation isn't a cause for concern, ask why your dollar doesn't buy as many Apple Jacks as it did 6 months ago.
Numbers don't lie. You've probably heard that expression. It's a paradox. While it's true, it will cause you to believe a falsehood. Number's don't lie, but they can be made to deceive you. Look behind the numbers. The real truth is likely in the small print.
Working on a new post already, pondering the question between the difference in two verbs: govern and rule. Which did we consent to? Which are we receiving?
Tuesday, April 19, 2011
Post Tax Day Review
Taxes, as expected for this time of year, have been much talked about in the past few weeks. With recent reports that nearly half of US households pay no income tax at all, I thought it would be a good time to review the subject touching on various levels of taxation and the general feel of the population.
Recently we've learned that large corporations, some turning enormous profits in the US pay NO income tax whatsoever. Giants like GE and Whirlpool make quite large profits manufacturing and selling "green" appliances. Simply by making these the companies get a tax credit that allows them to offset taxes on non-green products. These credits then become an asset of the corporation, thus making them more valuable to their shareholders. Making and selling green appliances is a profitable line of business by itself, do we really need additional profits to be generated by providing government subsidies through the tax code?
Now, let's take a look at our fiscal problems and how some would like to solve them. We are currently running a 1.6 trillion dollar a year deficit in this country. Some say this is because of "tax breaks for the wealthy." The same people saying this are the ones who say that we should have the above mentioned tax credits for conducting a profitable business because it suits their political agenda. Now some "facts" as they are currently accepted, straight from the Congressional Budget Office. First, during the debate over extending the Bush era tax rates last December, the CBO budgeted the "cost" of those tax rates at $70 billion per year. Yes, I know, the looters need that $70 billion. Why stop there? Why not tax 100% of income over $250,000? No one really needs more money than that each year right? (If you momentarily thought that this might be a good idea, then you're a looter.) The problem is, that would only fund the government for a little more than a third of 1 year. And guess what? No one is going to work to earn more than that after having their earnings confiscated by the government. Consider this question as well. If tax cuts cost money, why do revenues increase at a pace greater than GDP growth after a reduction in the top marginal rates?
Not that popular opinion matters much to me, but it is interesting to see what people think. Gallup introduced information from a series of polls taken between 2005 and 2011. At all times during these polls the current tax rates have been in place. If you're interested, go take a look at the entire poll. First the basic info 45% of Americans pay zero income tax. The top line of the poll says that 43% think they pay a "just right" amount of taxes. Hey, if I paid no taxes I'd think that was Just right too! Even more interesting was the perception of people in the lower and low middle income brackets, most of whom pay no federal income taxes at all. About 80% of these combined groups felt that what they paid was either fair or too much. Of course, these same people said that upper income individuals didn't pay enough. Looters.
Recently we've learned that large corporations, some turning enormous profits in the US pay NO income tax whatsoever. Giants like GE and Whirlpool make quite large profits manufacturing and selling "green" appliances. Simply by making these the companies get a tax credit that allows them to offset taxes on non-green products. These credits then become an asset of the corporation, thus making them more valuable to their shareholders. Making and selling green appliances is a profitable line of business by itself, do we really need additional profits to be generated by providing government subsidies through the tax code?
Now, let's take a look at our fiscal problems and how some would like to solve them. We are currently running a 1.6 trillion dollar a year deficit in this country. Some say this is because of "tax breaks for the wealthy." The same people saying this are the ones who say that we should have the above mentioned tax credits for conducting a profitable business because it suits their political agenda. Now some "facts" as they are currently accepted, straight from the Congressional Budget Office. First, during the debate over extending the Bush era tax rates last December, the CBO budgeted the "cost" of those tax rates at $70 billion per year. Yes, I know, the looters need that $70 billion. Why stop there? Why not tax 100% of income over $250,000? No one really needs more money than that each year right? (If you momentarily thought that this might be a good idea, then you're a looter.) The problem is, that would only fund the government for a little more than a third of 1 year. And guess what? No one is going to work to earn more than that after having their earnings confiscated by the government. Consider this question as well. If tax cuts cost money, why do revenues increase at a pace greater than GDP growth after a reduction in the top marginal rates?
Not that popular opinion matters much to me, but it is interesting to see what people think. Gallup introduced information from a series of polls taken between 2005 and 2011. At all times during these polls the current tax rates have been in place. If you're interested, go take a look at the entire poll. First the basic info 45% of Americans pay zero income tax. The top line of the poll says that 43% think they pay a "just right" amount of taxes. Hey, if I paid no taxes I'd think that was Just right too! Even more interesting was the perception of people in the lower and low middle income brackets, most of whom pay no federal income taxes at all. About 80% of these combined groups felt that what they paid was either fair or too much. Of course, these same people said that upper income individuals didn't pay enough. Looters.
Thursday, April 14, 2011
We're Awash in Budget Proposals (or How Many Football Analogies Can I Put in a Blog Post)
After neglecting to even propose a full year budget for 2011, Congress and the President are clamoring to present their brillian ideas for 2012. First we had the 2 week late fumble by the White House. Maybe fumble isn't the right metaphor. What the president did instead was put the ball down on the fifty yard line and walk off the field. Next came the hail mary pass by Budget Committee Chair, Paul Ryan. A desperate pass, but it represents an honest effort. As noted yesterday, the President came forward for another try. This was akin to a pump fake followed by a kneel down. The Congressional Progressive Caucus has joined the fray as well. They have all climbed on the back of the most productive member of their team and are now insisting he carry them and the ball over the goal line.
The progressive highlight reel begins with a near 50% tax rate for top earners. That'll do wonders for small businesses. Followed by a $300 billion reduction per year of defense spending. All this extra money doesn't go to pay down deficits or pay off our national debt, instead it goes to adopting the single payer health care plan that was defeated in 2009, expanding bureaucracies, and of course, hiring more tax agents to track down half of your income.
The progressive highlight reel begins with a near 50% tax rate for top earners. That'll do wonders for small businesses. Followed by a $300 billion reduction per year of defense spending. All this extra money doesn't go to pay down deficits or pay off our national debt, instead it goes to adopting the single payer health care plan that was defeated in 2009, expanding bureaucracies, and of course, hiring more tax agents to track down half of your income.
Wednesday, April 13, 2011
You'll Need the Ghost of Billy Mays to Sell This Load of Shit
Every few weeks it seems, marketers in our nation's capital identify trends important to the People. And, just like corporate marketers, politicians try to put that trendy twist on the crap they're selling. Lately, Americans seem to be interested in reducing government spending. The much villified tea party gains a lot of credit for turning this once neglected idea into the hip and trendy concept of today.
Rep. Ryan of Wisconsin is selling a fully loaded 6 trillion dollars worth of spending reductions. The Speaker of the House and the President recently got together and are trying to now pass a bill that while it appears to be a spending reduction is half spending reduction and half "money we didn't spend last year and weren't GOING to spend this year."
And today, we have our president, shovelling more bullshit. The sales pitch that jumped the spending reduction shark perhaps? Ladies and gentlemen, I give to you The Spending Reduction In the Tax Code.
"Huh?"
Yes indeed. Our tax code is responsible for spending about 77% of GDP annually, more than 3 times the rest of the federal government combined. How? By only taxing 23% of it. That's right, the Spending Reduction in the Tax Code is simply a re-branded tax increase.
Are you tired of being treated like an idiot, talked to like a simpleton, or just plain ignored?
Me too.
Rep. Ryan of Wisconsin is selling a fully loaded 6 trillion dollars worth of spending reductions. The Speaker of the House and the President recently got together and are trying to now pass a bill that while it appears to be a spending reduction is half spending reduction and half "money we didn't spend last year and weren't GOING to spend this year."
And today, we have our president, shovelling more bullshit. The sales pitch that jumped the spending reduction shark perhaps? Ladies and gentlemen, I give to you The Spending Reduction In the Tax Code.
"Huh?"
Yes indeed. Our tax code is responsible for spending about 77% of GDP annually, more than 3 times the rest of the federal government combined. How? By only taxing 23% of it. That's right, the Spending Reduction in the Tax Code is simply a re-branded tax increase.
Are you tired of being treated like an idiot, talked to like a simpleton, or just plain ignored?
Me too.
Tuesday, April 12, 2011
Obama Calls a Mulligan
Tomorrow, our president will ask for a do-over. You see, in February of this year, the President released his budget proposal calling for an increase in federal spending to $3.7 Trillion. Despite the hype, seen exclusively at http://www.whitehouse.gov/, the budget contained very little in the way of real spending reform. In fact, the only true nod to reform was a five year freeze on federal employee wages.
In the meantime, the country has become more vocal in demanding real cuts faster. The House is preparing to pass a budget that reduces the federal deficits over the next 10 years by $6 Trillion. More, people have been demanding that our President be involved in this process, that the Leader of the Free World do something novel, like lead. So, now, with an address scheduled for tomorrow night, the President appears ready to do just that. Let's hope.
In the meantime, the country has become more vocal in demanding real cuts faster. The House is preparing to pass a budget that reduces the federal deficits over the next 10 years by $6 Trillion. More, people have been demanding that our President be involved in this process, that the Leader of the Free World do something novel, like lead. So, now, with an address scheduled for tomorrow night, the President appears ready to do just that. Let's hope.
Monday, April 11, 2011
Atlas Shrugged Movie - Coming to a Theatre...somewhere
For those of you who have read Ayn Rand's Atlas Shrugged, an independent studio is preparing to release part 1 of their movie version this Friday, April 15th. If you're interested in seeing the movie, check out their website below:
http://www.atlasshruggedpart1.com/
The film is being released to only a limited # of theatres due to demand and a lack of marketing budget. The website includes a link to try to demand the movie come to a theatre near you. Personally, I'll drive where I have to in order to see it.
Down with the looters.
http://www.atlasshruggedpart1.com/
The film is being released to only a limited # of theatres due to demand and a lack of marketing budget. The website includes a link to try to demand the movie come to a theatre near you. Personally, I'll drive where I have to in order to see it.
Down with the looters.
Wednesday, March 16, 2011
Question re: Political Thinking
Since November we've been hearing on a fairly regular basis how the 2012 campaign has begun, how the potential contenders on one side are jockeying for position and now we're hearing that the current President's administration is focusing on re-election. The thought is that by diverting a portion of his attention to the campaign now, the President can still, with diminishing attention to the needs of the country and the world, continue to lead throughout the term. My question is this: Should a person elected to office spend any of their time while in office campaigning for re-election? Asked in another way, why can't the fruits of your labor be your best advertisement?
It reminds me of a story I heard of a man being told that he hadn't gotten the promotion he'd worked so hard to win. He had wined the right people, dined the right people, played golf with the right people. All the while, the person who got the promotion was the one who went about his job with dilligence.
Can our political system work that way? I fear that it cannot. Why do politicians campaign so often, pander to special interests and cozy up to lobbyists? Money. Money to pay for 30 second sound bites. Why the 30 second sound bites? Why not the strength of your accomplishments? The 30 second sound bite works better. The general public spends so little time studying political races that name recognition alone can generate a win on election day. In some locations it's the little letter next to the name that signifies the win. In others, it's simply the spelling of your last name. So, if we're not going to judge our politicians on the strength of their accomplishments, then we certainly can't expect them to try so hard for them, can we?
It reminds me of a story I heard of a man being told that he hadn't gotten the promotion he'd worked so hard to win. He had wined the right people, dined the right people, played golf with the right people. All the while, the person who got the promotion was the one who went about his job with dilligence.
Can our political system work that way? I fear that it cannot. Why do politicians campaign so often, pander to special interests and cozy up to lobbyists? Money. Money to pay for 30 second sound bites. Why the 30 second sound bites? Why not the strength of your accomplishments? The 30 second sound bite works better. The general public spends so little time studying political races that name recognition alone can generate a win on election day. In some locations it's the little letter next to the name that signifies the win. In others, it's simply the spelling of your last name. So, if we're not going to judge our politicians on the strength of their accomplishments, then we certainly can't expect them to try so hard for them, can we?
Tuesday, March 15, 2011
The Freedom to "Marry"
As I sit here on the eve of my nuptials I feel quite fortunate. Not only am I fortunate to be marrying a remarkable woman who amazes me daily with her kindness, grace, intelligence, and warmth, but also for the fact that my marriage is to be allowed, blessed by society, and those rights and privileges granted to unions bestowed upon my own.
A small percentage of our society is not so fortunate. They are free to co-habitate, to form their own unions, but the State refuses to recognize it. Insurance companies recognize it. Those heartless corporate monstrosities that are the bane of our society (according to the State) grant the same privilege of shared coverage to unions regardless of whether or not the State recognizes them.
What is the problem? The problem is that a majority of people are unnerved by homosexuality. They feel it detracts from our society in some way. It is somehow immoral and permissive in a way that damages the rest of us. All of this may be true (though I doubt it), but do not forget my first lesson: Freedom is supreme.
What harm to you if a homosexual couple can file a joint tax return? What harm to you if a homosexual couple can file a joint bankruptcy, receive survivor benefits, or simply be recognized for the love and devotion they show each other?
Perhaps there is a misconception. No one, at least not that I've heard, is demanding that churches be forced to perform Christian Marriage ceremonies for homosexual couples (though if they did, I do not think God would mind). All that is asked is that the union be granted the same rights as that of any other civil union in this country.
Don't get me wrong. I support your freedom to disagree, I support your freedom to discriminate if that's what you choose to do. I just hope that our society will visit upon you the consequences such actions deserve.
This weekend, while out for a drive, I drove by a small protest of sorts. A group of people had gathered on a street corner holding signs. Gay marriage is bad. Marriage = 1 man 1 woman. Honk if you opposed Senate Bill blah blah blah. I didn't hear any honks. I considered honking, but only to draw their attention to my middle finger, but no. Let them protest, let them express their opinions. They are free to do as they will. I pray that we may all be free to live and love as we see fit.
Going into this weekend, I count myself the most fortunate of men. I am marrying my best friend. I'm a bundle of nerves and anticipation. What few doubts there have been are erased at her smile and cease to exist at her touch. I wish you all the same peace and love and joy that I feel, and of course, the same freedoms that I enjoy and more.
A small percentage of our society is not so fortunate. They are free to co-habitate, to form their own unions, but the State refuses to recognize it. Insurance companies recognize it. Those heartless corporate monstrosities that are the bane of our society (according to the State) grant the same privilege of shared coverage to unions regardless of whether or not the State recognizes them.
What is the problem? The problem is that a majority of people are unnerved by homosexuality. They feel it detracts from our society in some way. It is somehow immoral and permissive in a way that damages the rest of us. All of this may be true (though I doubt it), but do not forget my first lesson: Freedom is supreme.
What harm to you if a homosexual couple can file a joint tax return? What harm to you if a homosexual couple can file a joint bankruptcy, receive survivor benefits, or simply be recognized for the love and devotion they show each other?
Perhaps there is a misconception. No one, at least not that I've heard, is demanding that churches be forced to perform Christian Marriage ceremonies for homosexual couples (though if they did, I do not think God would mind). All that is asked is that the union be granted the same rights as that of any other civil union in this country.
Don't get me wrong. I support your freedom to disagree, I support your freedom to discriminate if that's what you choose to do. I just hope that our society will visit upon you the consequences such actions deserve.
This weekend, while out for a drive, I drove by a small protest of sorts. A group of people had gathered on a street corner holding signs. Gay marriage is bad. Marriage = 1 man 1 woman. Honk if you opposed Senate Bill blah blah blah. I didn't hear any honks. I considered honking, but only to draw their attention to my middle finger, but no. Let them protest, let them express their opinions. They are free to do as they will. I pray that we may all be free to live and love as we see fit.
Going into this weekend, I count myself the most fortunate of men. I am marrying my best friend. I'm a bundle of nerves and anticipation. What few doubts there have been are erased at her smile and cease to exist at her touch. I wish you all the same peace and love and joy that I feel, and of course, the same freedoms that I enjoy and more.
Monday, March 14, 2011
The Misconception of Protection
As this recent budget battle is illustrating, the calls to cut federal funding for certain programs and enforcement of some regulations leads people to cry out that the thin veil of protection we have from all sorts of societal and industrial evils is about to descend on out land once again.
"If we cut the food safety budget then food will be unsafe!" "If we cut defense spending the world will fall apart." On and on the cries go lamenting proposed cuts in everything from education funding to farm subsidies, but what if the money does more harm than good? What if it simply does nothing at all?
There is a perception amongst the populace that absent heavy handed government regulation and oversight, our society would more closely resemble the wild west than an orderly society. This is simply not true. The rise of government bureaucracy did not facillitate the rise of a peaceful society. More likely it was conditions created by the broader economy that settled our lands and actually gave rise to an overly burdensome federal bureaucracy.
Over the past 40 years the pace of per child spending on primary and secondary education has grown at a rate better than twice that of inflation. Has this produced greater results? No. Why not? Part of the reason is that the money that actually makes it down to the schools has NOT grown at that rate. Instead, substantial sums are lost in the bureaucracy, spent on pet projects and not on those that are proven to do the most good. Another chunk of that money has gone to fund the very same unions that have forced destructive tenure and job security rules that protect underperforming teachers at the expense of those who are newer and brighter.
On food safety, there have been several high profile food safety issues over the last few years. Has the federal government's many programs for food safety prevented these? No. Have they helped discourage new problems? Perhaps, but one factor helps discourage food safety issues more than any other: litigation. It is NOT fear of a federal agency shutting their doors that keeps farmers and food processors from cutting safety measures. More likely it is the threat of expensive litigation stemming from what harm they may cause that creates greater safety in our food supply.
Even when it comes to building and maintaining roads, the government is extraordinarily inefficient. The question that should be asked with all of these issues is, who can do it better? If the courts and the private sector can enforce food safety better than the FDA, let them. If private companies can build better roads and keep them in better shape for less money overall than state, local and federal governments, go for it! Yes, you're reading me right and I KNOW it's controversial, but if what many consider to be the essential functions of government can be done in a better manner and more efficiently WITHOUT the intervention of a bloated bureaucracy, why isn't this happening?
Quite simply. Our government no longer exists for our benefit. It exists to benefit itself. Like all of the EVIL corporations that are only looking out for their bottom line, the government is only looking out for itself and the people who work for it. From the regulators who invent new regulation to give themselves more power and therefore sustain their relevance to the elected representatives who fulfill the desires of this special interest group or that in order to get re-elected, our government is no longer FOR the people. Hey, at least with a public corporation they're responsible to their shareholders. It must seem easier to replace a member of a corporate board than a government official these days, elected or appointed, it doesn't seem to matter.
Tomorrow: The Freedom to "Marry"
"If we cut the food safety budget then food will be unsafe!" "If we cut defense spending the world will fall apart." On and on the cries go lamenting proposed cuts in everything from education funding to farm subsidies, but what if the money does more harm than good? What if it simply does nothing at all?
There is a perception amongst the populace that absent heavy handed government regulation and oversight, our society would more closely resemble the wild west than an orderly society. This is simply not true. The rise of government bureaucracy did not facillitate the rise of a peaceful society. More likely it was conditions created by the broader economy that settled our lands and actually gave rise to an overly burdensome federal bureaucracy.
Over the past 40 years the pace of per child spending on primary and secondary education has grown at a rate better than twice that of inflation. Has this produced greater results? No. Why not? Part of the reason is that the money that actually makes it down to the schools has NOT grown at that rate. Instead, substantial sums are lost in the bureaucracy, spent on pet projects and not on those that are proven to do the most good. Another chunk of that money has gone to fund the very same unions that have forced destructive tenure and job security rules that protect underperforming teachers at the expense of those who are newer and brighter.
On food safety, there have been several high profile food safety issues over the last few years. Has the federal government's many programs for food safety prevented these? No. Have they helped discourage new problems? Perhaps, but one factor helps discourage food safety issues more than any other: litigation. It is NOT fear of a federal agency shutting their doors that keeps farmers and food processors from cutting safety measures. More likely it is the threat of expensive litigation stemming from what harm they may cause that creates greater safety in our food supply.
Even when it comes to building and maintaining roads, the government is extraordinarily inefficient. The question that should be asked with all of these issues is, who can do it better? If the courts and the private sector can enforce food safety better than the FDA, let them. If private companies can build better roads and keep them in better shape for less money overall than state, local and federal governments, go for it! Yes, you're reading me right and I KNOW it's controversial, but if what many consider to be the essential functions of government can be done in a better manner and more efficiently WITHOUT the intervention of a bloated bureaucracy, why isn't this happening?
Quite simply. Our government no longer exists for our benefit. It exists to benefit itself. Like all of the EVIL corporations that are only looking out for their bottom line, the government is only looking out for itself and the people who work for it. From the regulators who invent new regulation to give themselves more power and therefore sustain their relevance to the elected representatives who fulfill the desires of this special interest group or that in order to get re-elected, our government is no longer FOR the people. Hey, at least with a public corporation they're responsible to their shareholders. It must seem easier to replace a member of a corporate board than a government official these days, elected or appointed, it doesn't seem to matter.
Tomorrow: The Freedom to "Marry"
Friday, March 11, 2011
Collective Bargaining "Rights"
The constitution is being amended before our eyes.
A dozen times in as many days I've heard of the ASSAULT on worker's constitutionally protected rights to bargain collectively. I'm a bit lost, I don't recall that from my con law classes or from my readings of the constitution. Could someone point this one out to me?
I'm all for supporting your freedom to do as you choose. If you choose to form an affiliation to bargain collectively with your employer. Do it. Go for it. I support your freedom to do so. When your boss fires you for doing it. I support him or her too.
For now, let's get real about this subject. The constitution does not guarantee any rights to bargain collectively without fear of recrimination from your employer. In a constitutionally questionable manner, Congress has conveyed this ability to certain classes of workers. In doing so, they have limited the rights of free speech of business owners and the right to conduct their businesses in a profitable manner. States have further damaged the constitutional rights by making it mandatory to join a union and pay dues to work in certain jobs.
Let me just say this again, your freedom to unionize should not affect my freedom to stop doing business with you.
Next week we'll talk about the false perception of safety we get from our government's interference with free enterprise. Until then...
A dozen times in as many days I've heard of the ASSAULT on worker's constitutionally protected rights to bargain collectively. I'm a bit lost, I don't recall that from my con law classes or from my readings of the constitution. Could someone point this one out to me?
I'm all for supporting your freedom to do as you choose. If you choose to form an affiliation to bargain collectively with your employer. Do it. Go for it. I support your freedom to do so. When your boss fires you for doing it. I support him or her too.
For now, let's get real about this subject. The constitution does not guarantee any rights to bargain collectively without fear of recrimination from your employer. In a constitutionally questionable manner, Congress has conveyed this ability to certain classes of workers. In doing so, they have limited the rights of free speech of business owners and the right to conduct their businesses in a profitable manner. States have further damaged the constitutional rights by making it mandatory to join a union and pay dues to work in certain jobs.
Let me just say this again, your freedom to unionize should not affect my freedom to stop doing business with you.
Next week we'll talk about the false perception of safety we get from our government's interference with free enterprise. Until then...
Thursday, March 10, 2011
Life's Lessons Are All Around Us
So, this past week I've been in the Big Easy celebrating Mardi Gras with some of my closest friends. While down there I was struck by how attending parades seemed to reflect life.
For example, you have 2 basic types of parade-goers, the preparers and those who just show up. These 2 main groups also have sub-groups. For those who just show up, you have those who are content to take what they can get, those who bully their way to the front, and those who simply expect the front row to be given unto them. The preparers also have subgroups. You have those who go all out with the food, bathrooms, chairs, umbrellas, police tape, etc to mark their turf, and those who just show up early and stand around. Across both of these you have those who stand their ground to the bullies and the whiners and those who just give up what they've worked for in the face of either aggression or whining.
As with the rest of life in this country, even if you just show up, you can find a good spot. It might not be on the best stretch of street, it may not be in the front row, but if you look long enough, put in the work, you can find a spot and catch a lot of beads.
My favorite of all parade-going groups is the kids. They have fun.
For example, you have 2 basic types of parade-goers, the preparers and those who just show up. These 2 main groups also have sub-groups. For those who just show up, you have those who are content to take what they can get, those who bully their way to the front, and those who simply expect the front row to be given unto them. The preparers also have subgroups. You have those who go all out with the food, bathrooms, chairs, umbrellas, police tape, etc to mark their turf, and those who just show up early and stand around. Across both of these you have those who stand their ground to the bullies and the whiners and those who just give up what they've worked for in the face of either aggression or whining.
As with the rest of life in this country, even if you just show up, you can find a good spot. It might not be on the best stretch of street, it may not be in the front row, but if you look long enough, put in the work, you can find a spot and catch a lot of beads.
My favorite of all parade-going groups is the kids. They have fun.
Thursday, March 3, 2011
Thanks Michael Moore, I Just Threw Up a Little
No, Michael Moore didn't take off his shirt. What he did was open his mouth. Normally, this wouldn't be enough to make me vomit, but today, well, he got to me. Here's what he said (speaking about wealthy people):
"They're sitting on the money, they're using it for their own -- they're putting it someplace else with no interest in helping you with your life, with that money. We've allowed them to take that. That's not theirs, that's a national resource, that's ours. We all have this -- we all benefit from this or we all suffer as a result of not having it,"
Bad enough? Nope.
"I think we need to go back to taxing these people at the proper rates. They need to -- we need to see these jobs as something we some, that we collectively own as Americans and you can't just steal our jobs and take them someplace else."
Now that I've stopped sputtering in rage, let's break down these statements.
Wealthy people are sitting on their money and not giving it away for your benefit.
This is just not true. Americans give more to charity than any other nation. We could do more perhaps, but maintaining at least the semblance of private property rights is one of the last bastions of freedom we have left.
We've "allowed" them to take that money, but it's not theirs, it's ours.
The vast majority of weath in this country is EARNED. In the case of inherited wealth it may have been earned by a prior generation, but it was still earned. What I earn by the sweat of my brow or through my ingenuity belongs to NO ONE but me.
<deep breaths>
Ok, I'm calm again, let's continue.
We need to tax people at the right rates.
Is Michael Moore rational here? Could he possibly be suggesting a flat tax? Well, taken in the context of the prior statement, I'd say no. More likely he's proposing a 100% tax on wealth. (Just not his I'm sure) Why not, it's not their money, so why should they keep any of it?
We collectively own the jobs, you can't steal them and take them someplace else.
I could probably write for 2 days the problems with this statement. If jobs become a property right in this county we are in for some serious trouble. Stop and think about it. Some due process is required to take your property no matter if you don't fully own it. The constitution requires this, that no person will be deprived of property without due process of law. This may involve a civil suit, a government action, or a foreclosure proceeding. As deficient as some of these are, it's still not entirely easy to take your property. So, let's say you have a job, and that job is your property. Let's further suppose you're really bad at that job. You're lazy. You're on drugs. Whatever. Is your boss, the person who built your company, owns your company, etc going to have to get a court order to fire you?
You'd think this is just one nut job mouthing off. Unfortunately, you'd be mistaken. There is actually a decent segment of our society who believes this garbage. People will not produce when they can't enjoy the fruits of their labor. Further, you're dealing with a slipperly slope. Where does the assault on freedom end? It ends with education. We must educate ourselves and our families on the importance of freedom, the significance of proper incentives in our lives, and the rewards of hard work.
Short break coming up for Mardi Gras, where I reward myself for my good behavior and hard work this past year. I may have some short posts over the weekend, but maybe not.
Have a great weekend. See you next week!
"They're sitting on the money, they're using it for their own -- they're putting it someplace else with no interest in helping you with your life, with that money. We've allowed them to take that. That's not theirs, that's a national resource, that's ours. We all have this -- we all benefit from this or we all suffer as a result of not having it,"
Bad enough? Nope.
"I think we need to go back to taxing these people at the proper rates. They need to -- we need to see these jobs as something we some, that we collectively own as Americans and you can't just steal our jobs and take them someplace else."
Now that I've stopped sputtering in rage, let's break down these statements.
Wealthy people are sitting on their money and not giving it away for your benefit.
This is just not true. Americans give more to charity than any other nation. We could do more perhaps, but maintaining at least the semblance of private property rights is one of the last bastions of freedom we have left.
We've "allowed" them to take that money, but it's not theirs, it's ours.
The vast majority of weath in this country is EARNED. In the case of inherited wealth it may have been earned by a prior generation, but it was still earned. What I earn by the sweat of my brow or through my ingenuity belongs to NO ONE but me.
<deep breaths>
Ok, I'm calm again, let's continue.
We need to tax people at the right rates.
Is Michael Moore rational here? Could he possibly be suggesting a flat tax? Well, taken in the context of the prior statement, I'd say no. More likely he's proposing a 100% tax on wealth. (Just not his I'm sure) Why not, it's not their money, so why should they keep any of it?
We collectively own the jobs, you can't steal them and take them someplace else.
I could probably write for 2 days the problems with this statement. If jobs become a property right in this county we are in for some serious trouble. Stop and think about it. Some due process is required to take your property no matter if you don't fully own it. The constitution requires this, that no person will be deprived of property without due process of law. This may involve a civil suit, a government action, or a foreclosure proceeding. As deficient as some of these are, it's still not entirely easy to take your property. So, let's say you have a job, and that job is your property. Let's further suppose you're really bad at that job. You're lazy. You're on drugs. Whatever. Is your boss, the person who built your company, owns your company, etc going to have to get a court order to fire you?
You'd think this is just one nut job mouthing off. Unfortunately, you'd be mistaken. There is actually a decent segment of our society who believes this garbage. People will not produce when they can't enjoy the fruits of their labor. Further, you're dealing with a slipperly slope. Where does the assault on freedom end? It ends with education. We must educate ourselves and our families on the importance of freedom, the significance of proper incentives in our lives, and the rewards of hard work.
Short break coming up for Mardi Gras, where I reward myself for my good behavior and hard work this past year. I may have some short posts over the weekend, but maybe not.
Have a great weekend. See you next week!
Wednesday, March 2, 2011
Jobs v Wages v Taxes v Growth: Part 4 - A Few Hopes
Taxes need to fall so companies will invest more in the US, creating new jobs, with better wages that will grow the economy.
We've talked about incentives before, but now I want to put some of that theory into practical practice. The basics: people are motivated to act by an incentive. You work because you want to get paid or you enjoy your job. You give to charity for the warm glow and the tax write-off. This seems to be most telling in the realm of taxation. A study of economic output over time will show you that productivity grows most after the enactment of a broad based tax cut. That is a tax cut that equally reduces the tax burden on the producing portions of our economy. Targeted credits have not had the same effect because they do not reward production in an economic sense.
A more interesting look at tax policy shows us something else. Regardless of the tax rate, overall taking of revenues as a percent of GDP wavers very slightly. From the close of World War II to present, with top marginal rate ranging from 25 to 70% the government has only captured between 17% and 19% of GDP. What does that mean? Simply that tax policies force a shift in spending and investment. Lowering of tax rates on production encourages us to produce more. Increasing these same rates encourages us to spend more in less taxed areas such as real estate, foreign investments or other (often less productive) capacities.
We should probably discuss at another time why our government insists on spending 20-25% of GDP.
But, how do we incentivize people to spend more, invest more, and produce more? A good start would be lowering taxes across the board to something closer to what people actually pay in taxes. The so called Debt Commission actually endorsed a tax rate of 23% for all earners meanwhile eliminating many popular tax dodges. Further, eliminate or significantly reduce taxes for repatriated income.
Quit subsidizing people for lack of production. From agricultural subsidies that subsidize empty fields and unproductive farmland to long-term unemployment benefits, if you quit paying people and companies not to produce then you will in fact encourage them TO produce. In the area of unemployment a real world experiment took place in Denmark. Denmark paid unemployment benefits for 5 years! Guess what? People stayed out of work for 5 years! When they reduced unemployment benefits to 4 years, people began finding jobs at the 4 year mark!
Finally, reduce federal spending. But! Federal spending enters the economy too, won't that reduce the size of the economy? Absent any other movement in the economy, yes. If I've said it once I've said it a thousand times, government does not spend money well. It is extraordinairily inefficient. Take a look at the recent GAO report that found dozens of duplicative programs costs billions of dollars a year. Do we really need 82 programs to improve teacher quality? Really? 82? The other reason government spending is bad is because our government is OVERSPENDING. This means that at some point in the future, we will have to increase revenues to make up for the costs we are incurring today.
We can always hope, right?
We've talked about incentives before, but now I want to put some of that theory into practical practice. The basics: people are motivated to act by an incentive. You work because you want to get paid or you enjoy your job. You give to charity for the warm glow and the tax write-off. This seems to be most telling in the realm of taxation. A study of economic output over time will show you that productivity grows most after the enactment of a broad based tax cut. That is a tax cut that equally reduces the tax burden on the producing portions of our economy. Targeted credits have not had the same effect because they do not reward production in an economic sense.
A more interesting look at tax policy shows us something else. Regardless of the tax rate, overall taking of revenues as a percent of GDP wavers very slightly. From the close of World War II to present, with top marginal rate ranging from 25 to 70% the government has only captured between 17% and 19% of GDP. What does that mean? Simply that tax policies force a shift in spending and investment. Lowering of tax rates on production encourages us to produce more. Increasing these same rates encourages us to spend more in less taxed areas such as real estate, foreign investments or other (often less productive) capacities.
We should probably discuss at another time why our government insists on spending 20-25% of GDP.
But, how do we incentivize people to spend more, invest more, and produce more? A good start would be lowering taxes across the board to something closer to what people actually pay in taxes. The so called Debt Commission actually endorsed a tax rate of 23% for all earners meanwhile eliminating many popular tax dodges. Further, eliminate or significantly reduce taxes for repatriated income.
Quit subsidizing people for lack of production. From agricultural subsidies that subsidize empty fields and unproductive farmland to long-term unemployment benefits, if you quit paying people and companies not to produce then you will in fact encourage them TO produce. In the area of unemployment a real world experiment took place in Denmark. Denmark paid unemployment benefits for 5 years! Guess what? People stayed out of work for 5 years! When they reduced unemployment benefits to 4 years, people began finding jobs at the 4 year mark!
Finally, reduce federal spending. But! Federal spending enters the economy too, won't that reduce the size of the economy? Absent any other movement in the economy, yes. If I've said it once I've said it a thousand times, government does not spend money well. It is extraordinairily inefficient. Take a look at the recent GAO report that found dozens of duplicative programs costs billions of dollars a year. Do we really need 82 programs to improve teacher quality? Really? 82? The other reason government spending is bad is because our government is OVERSPENDING. This means that at some point in the future, we will have to increase revenues to make up for the costs we are incurring today.
We can always hope, right?
Tuesday, March 1, 2011
Jobs v Wages v Taxes v Growth: Part 3 - Revenge of the Posts
SPEND!!!!
You may recall that we discussed briefly the fact that companies are reportedly sitting on several trillion dollars in profits being held by overseas subsidiaries. That money could easily be put to use back here to reinvest in new projects, new production and growth. So, why is it sitting over in other countries? First we should look at how it got there in the first place, at least at a few reasons.
Companies spend a LOT of money researching, developing and then building new products and services to sell here in the United States. These products go through what's known as the product life cycle, until, finally it is obsolete. Well, HERE it's obsolete. Oftimes overseas what we consider to be last year's hit is tomorrows next best thing. So, goods are shipped overseas and sold.
Other companies, such as McDonald's, Wal-Mart, Kentucky Fried Chicken and countless others have established a world-wide branding that allows them to sell their businesses in countries around the world.
So, now the company is making money overseas. This money stays there until re-patriated into the US. A number of countries, ours included taxes revenues from overseas when it is re-patriated. The difference is that the US taxes that income at 35%. Most other developed nations tax this revenue at a much lower rate, averaging slightly less than 20%. So, the company is faced with a decision. Does it bring that money home and reinvest in the United States or does it reinvest those funds in the other country? The challenge in bringing that money home is that it has to have a return sufficient to make up for the higher tax rate paid. It's profit motivation pure and simple.
We could encourage companies to invest in domestic spending and job growth by doing one simple thing: Lowering our tax rate on repatriated revenues to the international average or below. The money comes home then gets spent building new facilities, hiring new workers, or paying dividends. Those dividends are then either reinvested or spent.
Here's an interesting thought. If $1 trillion dollars is repatriated at 35% tax rate, then the remaining $650 billion is paid out just in dividends, which the government will tax at a rate between 5 and 15%. The average is actually closer to 12%. That's $78 billion additional dollars spent on taxes. Essentially that 35% tax rate just went up to 42.8%. If that money was spent on wages then it could go even higher. With our current policies that money is staying out of the US Economy. Other countries will continue to reap the benefits of our heavy handed tax policies and our economy will continue to limp along in this "recovery."
You may recall that we discussed briefly the fact that companies are reportedly sitting on several trillion dollars in profits being held by overseas subsidiaries. That money could easily be put to use back here to reinvest in new projects, new production and growth. So, why is it sitting over in other countries? First we should look at how it got there in the first place, at least at a few reasons.
Companies spend a LOT of money researching, developing and then building new products and services to sell here in the United States. These products go through what's known as the product life cycle, until, finally it is obsolete. Well, HERE it's obsolete. Oftimes overseas what we consider to be last year's hit is tomorrows next best thing. So, goods are shipped overseas and sold.
Other companies, such as McDonald's, Wal-Mart, Kentucky Fried Chicken and countless others have established a world-wide branding that allows them to sell their businesses in countries around the world.
So, now the company is making money overseas. This money stays there until re-patriated into the US. A number of countries, ours included taxes revenues from overseas when it is re-patriated. The difference is that the US taxes that income at 35%. Most other developed nations tax this revenue at a much lower rate, averaging slightly less than 20%. So, the company is faced with a decision. Does it bring that money home and reinvest in the United States or does it reinvest those funds in the other country? The challenge in bringing that money home is that it has to have a return sufficient to make up for the higher tax rate paid. It's profit motivation pure and simple.
We could encourage companies to invest in domestic spending and job growth by doing one simple thing: Lowering our tax rate on repatriated revenues to the international average or below. The money comes home then gets spent building new facilities, hiring new workers, or paying dividends. Those dividends are then either reinvested or spent.
Here's an interesting thought. If $1 trillion dollars is repatriated at 35% tax rate, then the remaining $650 billion is paid out just in dividends, which the government will tax at a rate between 5 and 15%. The average is actually closer to 12%. That's $78 billion additional dollars spent on taxes. Essentially that 35% tax rate just went up to 42.8%. If that money was spent on wages then it could go even higher. With our current policies that money is staying out of the US Economy. Other countries will continue to reap the benefits of our heavy handed tax policies and our economy will continue to limp along in this "recovery."
Monday, February 28, 2011
Jobs v Wages v Taxes v Growth: Part 2 - Attack of the Government Drones
2. Taxes need to rise so that the government can spend more money and grow the economy.
Please keep in mind, that I'm not trying to teach the complexities of the economy, but a broad brush of the basics and how they can be applied to analyze a situation.
This statement, as heard in the previously mentioned on-air debate seems to stem from a perverted views of the work of John Maynard Keynes. Keynesian economics suggests that when the government spends money it has a multiplier effect, generating almost 1.5 times the total GDP impact. Respectfully to Mr. Keynes and the aforementioned debater, I disagree.
Taxes take money out of the economy to redirect spending. So, before you can analyze the impact of government spending on the overall economy you have to first look at the impact of taking money out of the economy by the government. Again, this is an oversimplification, but still remains true despite the omission of numerous factors.
When people and corporations pay taxes, this money leaves the private economy. The government then uses those monies to pay for a variety of things. Not least of these is paying interest on the already large amount of public debt that we owe. Much of this debt is to people, corporations and governments outside of our country. This money is essentially gone from the national economy. The rest of the money is then paid out to individuals, companies, and governments chosen by the legislative and executive branches of our Federal government. Often this money is put to productive use. Roads are built, wages are paid, healthcare is provided, etc. Sometimes, however, this money becomes sunk against the overall economy. The government literally pays people to NOT work, NOT produce. It can also be used to subsidize inefficient use of time and material resources. As an example, the government pays to offset the inefficient production of electricity, the inefficient delivery of health services, and for outdated military systems that the Pentagon has asked to scrap.
At the times Mr. Keynes was formulating his theory on the power of government spending on our economy, many of these expenditures did not exist or were extremely limited. How much have these programs impacted effectiveness of the Keynesian multiplier? Without more resources than what are at my disposal, I can't give you an exact figure, but it should not be hard for the GAO and or the CBO to give us a better estimate.
Putting all of the above arguments aside, the number one reason this statement is wrong is that it says the Government should choose how the money you've earned is spent, and not you. The greatest incentive to encourage most people to do more, earn more and produce more is to let them keep more of what it is they do, earn and produce.
Please keep in mind, that I'm not trying to teach the complexities of the economy, but a broad brush of the basics and how they can be applied to analyze a situation.
This statement, as heard in the previously mentioned on-air debate seems to stem from a perverted views of the work of John Maynard Keynes. Keynesian economics suggests that when the government spends money it has a multiplier effect, generating almost 1.5 times the total GDP impact. Respectfully to Mr. Keynes and the aforementioned debater, I disagree.
Taxes take money out of the economy to redirect spending. So, before you can analyze the impact of government spending on the overall economy you have to first look at the impact of taking money out of the economy by the government. Again, this is an oversimplification, but still remains true despite the omission of numerous factors.
When people and corporations pay taxes, this money leaves the private economy. The government then uses those monies to pay for a variety of things. Not least of these is paying interest on the already large amount of public debt that we owe. Much of this debt is to people, corporations and governments outside of our country. This money is essentially gone from the national economy. The rest of the money is then paid out to individuals, companies, and governments chosen by the legislative and executive branches of our Federal government. Often this money is put to productive use. Roads are built, wages are paid, healthcare is provided, etc. Sometimes, however, this money becomes sunk against the overall economy. The government literally pays people to NOT work, NOT produce. It can also be used to subsidize inefficient use of time and material resources. As an example, the government pays to offset the inefficient production of electricity, the inefficient delivery of health services, and for outdated military systems that the Pentagon has asked to scrap.
At the times Mr. Keynes was formulating his theory on the power of government spending on our economy, many of these expenditures did not exist or were extremely limited. How much have these programs impacted effectiveness of the Keynesian multiplier? Without more resources than what are at my disposal, I can't give you an exact figure, but it should not be hard for the GAO and or the CBO to give us a better estimate.
Putting all of the above arguments aside, the number one reason this statement is wrong is that it says the Government should choose how the money you've earned is spent, and not you. The greatest incentive to encourage most people to do more, earn more and produce more is to let them keep more of what it is they do, earn and produce.
Friday, February 25, 2011
Jobs v Wages v Taxes v Growth: Part 1 - The Frantic Menace
There are many competing theories on the best ways to grow our economy. As with most things, I tend to look for the ways that provide the most growth with the least government involvement. Fortunately for me, these two seem to be complimentary.
A debate I witnessed this morning included the following statements:
1. Wages need to rise so that consumers can spend more money and grow the economy.
2. Taxes need to rise so that the government can spend more money and grow the economy.
3. Companies are stockpiling too much money here and overseas. If they aren't going to spend it, that money should be taxed. This will encourage spending or increase tax revenues.
4. Taxes need to fall so companies will invest more in the US, creating new jobs, with better wages that will grow the economy.
Over the next 4 installments we'll cover these statements with some common sense analysis.
Wages Need to Rise!!!
Every few years the cry goes out, the poor are getting poorer. Companies are being greedy. Bad corporations are turning the working class into serfs and only paying them MINIMUM WAGE. Solution: Raise the minimum wage.
What really happens. The reality is that wages do not decrease, but over the past 40 years, the spending power of our wages have significantly decreased. Inflation, most often caused by poorly managed monetary policy, overspending in Washington, and artificially depressed interest rates causes the value of the US Dollar to decrease. Goods and services however, have a value that is not directly tied to the value of the dollar. Meaning that as the value of the dollar falls, the price must rise to match the REAL value of the good or service.
Monetary Policy - Let's say there are 1000 Dollars available to the world and everyone wants Dollars. The value of that dollar would rise. The supply is limited, the demand is high. Basic economics. Now, let's say that the government is printing trillions of dollars in order to spend more money. This has two consequences (there's that word again): First the dollar is now less valuable because they're abundant. Instead of being rare like gold they become like blades of grass. Second, the demand goes down because they're less valuable. If you know what a feedback loop is then you can probably see the danger this causes. Does this ever happen? Look at Germany post World War I and Argentina not too long ago.
Back to the real topic. Won't raising wages increase spending by consumers? On a micro level, yes, but when looking at the economy as a whole, probably not. Let's say you manage the payroll for company X. You have $100,000 to work with. Pretending that benefit and payroll tax costs do not exist you can either hire 2 people at $50,000 per year or 4 at $25,000 per year. Let's say the level of employee you need is rather low. The lower the level of employee the LARGER the supply of workers for that position. In a pure economic system this supply and demand curve would drive the cost of wages down and you could hire more workers for greater production. As the complexity and the needs for the position rise, so does the supply of workers qualified to do that job shrink. This makes the necessary wage higher. The other side of the equation is, what level of output would be required. This may also determine the number of employees required. If 3 employees are required to produce enough to support $100,000 in payroll, and each additional employee will increase production, then hiring 4 employees may produce enough additional capacity to support an additional employee, who may then increase production to a point to support yet another. When you're running a company, you have to look at the diminishing return of each additional employee added. For example. Three employees may help you gross $200,000, but a fourth would only increase that total by $50,000 and a fifth may only increase it further by $25,000. If the cost of employing the additional employee is less than the added value then you should obviously not add that employee.
Now, let's introduce artificial controls. Let's say the government steps in and says, wages are too low, you must increase your pay to a minimum of $30,000 per employee. Suddenly you either have to trim your staff down to 3, improve the efficiency of all 4, or raise your prices to sustain the additional cost. Most markets are priced very competitively. If you raise your prices, you lose business. If you increase productivity, there's a chance you lower prices by increasing the supply in the marketplace. What have you gained? So, you're only recourse is to cut a position.
Here's what it boils down to. At a given level of production, a company is only going to spend a certain amount of money on wages. Artificially raising wages per person is not going to increase the total, but it will increase it for those people who remain employed. For the person who gets laid off, that doesn't really help much, does it?
Don't get me wrong. Rising wages that do so on their own will increase spending in the overall economy. When they're not offset by rising production or price levels supported at the same production levels, what you wind up with is a recipe for lower overall employment and stagnant overall wage levels. So, how do you get wages to increase without harming the overall economy?
More importantly, do we want to live in a country where the government decides how we run our businesses? How much we have to pay employees? If we can't compete on a scale of wages, then we won't get the best qualified people, regardless of the position.
More to come in Part 2 - Attack of the Government Drones
A debate I witnessed this morning included the following statements:
1. Wages need to rise so that consumers can spend more money and grow the economy.
2. Taxes need to rise so that the government can spend more money and grow the economy.
3. Companies are stockpiling too much money here and overseas. If they aren't going to spend it, that money should be taxed. This will encourage spending or increase tax revenues.
4. Taxes need to fall so companies will invest more in the US, creating new jobs, with better wages that will grow the economy.
Over the next 4 installments we'll cover these statements with some common sense analysis.
Wages Need to Rise!!!
Every few years the cry goes out, the poor are getting poorer. Companies are being greedy. Bad corporations are turning the working class into serfs and only paying them MINIMUM WAGE. Solution: Raise the minimum wage.
What really happens. The reality is that wages do not decrease, but over the past 40 years, the spending power of our wages have significantly decreased. Inflation, most often caused by poorly managed monetary policy, overspending in Washington, and artificially depressed interest rates causes the value of the US Dollar to decrease. Goods and services however, have a value that is not directly tied to the value of the dollar. Meaning that as the value of the dollar falls, the price must rise to match the REAL value of the good or service.
Monetary Policy - Let's say there are 1000 Dollars available to the world and everyone wants Dollars. The value of that dollar would rise. The supply is limited, the demand is high. Basic economics. Now, let's say that the government is printing trillions of dollars in order to spend more money. This has two consequences (there's that word again): First the dollar is now less valuable because they're abundant. Instead of being rare like gold they become like blades of grass. Second, the demand goes down because they're less valuable. If you know what a feedback loop is then you can probably see the danger this causes. Does this ever happen? Look at Germany post World War I and Argentina not too long ago.
Back to the real topic. Won't raising wages increase spending by consumers? On a micro level, yes, but when looking at the economy as a whole, probably not. Let's say you manage the payroll for company X. You have $100,000 to work with. Pretending that benefit and payroll tax costs do not exist you can either hire 2 people at $50,000 per year or 4 at $25,000 per year. Let's say the level of employee you need is rather low. The lower the level of employee the LARGER the supply of workers for that position. In a pure economic system this supply and demand curve would drive the cost of wages down and you could hire more workers for greater production. As the complexity and the needs for the position rise, so does the supply of workers qualified to do that job shrink. This makes the necessary wage higher. The other side of the equation is, what level of output would be required. This may also determine the number of employees required. If 3 employees are required to produce enough to support $100,000 in payroll, and each additional employee will increase production, then hiring 4 employees may produce enough additional capacity to support an additional employee, who may then increase production to a point to support yet another. When you're running a company, you have to look at the diminishing return of each additional employee added. For example. Three employees may help you gross $200,000, but a fourth would only increase that total by $50,000 and a fifth may only increase it further by $25,000. If the cost of employing the additional employee is less than the added value then you should obviously not add that employee.
Now, let's introduce artificial controls. Let's say the government steps in and says, wages are too low, you must increase your pay to a minimum of $30,000 per employee. Suddenly you either have to trim your staff down to 3, improve the efficiency of all 4, or raise your prices to sustain the additional cost. Most markets are priced very competitively. If you raise your prices, you lose business. If you increase productivity, there's a chance you lower prices by increasing the supply in the marketplace. What have you gained? So, you're only recourse is to cut a position.
Here's what it boils down to. At a given level of production, a company is only going to spend a certain amount of money on wages. Artificially raising wages per person is not going to increase the total, but it will increase it for those people who remain employed. For the person who gets laid off, that doesn't really help much, does it?
Don't get me wrong. Rising wages that do so on their own will increase spending in the overall economy. When they're not offset by rising production or price levels supported at the same production levels, what you wind up with is a recipe for lower overall employment and stagnant overall wage levels. So, how do you get wages to increase without harming the overall economy?
More importantly, do we want to live in a country where the government decides how we run our businesses? How much we have to pay employees? If we can't compete on a scale of wages, then we won't get the best qualified people, regardless of the position.
More to come in Part 2 - Attack of the Government Drones
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