Happy Thanksgiving
Man, I don't know about the rest of you, but I can't wait to put myself into a tryptophan coma today. (Then maybe I'll eat a little turkey.) Happy Thanksgiving.
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November 22, 2007
November 21, 2007
Supply side snake oil
Like many others here, I often find myself reading this or that bit of nonsense from some supply-sider and thinking, "Christ, what an utter load of bullsheetrock." The problem, as I see it, is that suppy side economics has become a religion for too many people, and tax cuts have become the holy grail, a panacea for all that ails us, and even a tool for revenue enhancement!
Yes, most of this is bullsheetrock, and there are a number of right-leaning think tanks that would no doubt have excommunicated me for heresy by this point. Still, I maintain that the problem is not with supply side economics itself, so much as overzealousness on the part of its adherents.
Below is the famous Laffer Curve.
I submit that the Laffer Curve is completely uncontroversial, so long as one isn't too concerned with its exact shape. I think we can agree, for example, on the endpoints. If the tax rate is 0%, we get zero revenue. If the tax rate is 100%, we also get zero revenue, or near to it, because no one will work. In the middle somewhere is a maximum, labeled "Equilibrium Point" in the diagram. Perhaps it's skewed more to the right than the figure above shows, but it's in there somewhere.
I think we should all be able to agree on that much. Now, what supply siders say is this: There is no reason for any government to have tax rates to the right of the equilibrium point, ever. On this point, they are correct. Tax cuts for such a system would not only return more money to private taxpayers, but would also swell government coffers, as the tax rate moves back toward the optimum, increasing government revenue. In this instance, tax cuts really can "pay for themselves."
Now applying this logic to the U.S. income tax code might have made sense back in the 70's, when Art Laffer first sketched in on a cocktail napkin, but it makes no sense given the income tax rates of today.
It drives me crazy to see right-wing religionists misusing supply side theory to claim that tax cuts always pay for themselves. They don't! And the Laffer Curve doesn't claim that. In fact, if you look at the graph, tax rate cuts anywhere to the left of the equilibrium point actually reduce government revenue.
Given today's income tax rate structure, I just don't believe that future tax cuts would increase revenue. What I will grant the Church of Arthur Laffer is this: future tax rate cuts will be less costly than CBO's "static scoring" might indicate. Such tax cuts do have a stimulative effect and might help augment the tax base, and therefore make such a tax cut less costly than the CBO might assume, but that's a far cry from "paying for itself."
Now don't get me wrong. I'd support almost any tax cut for pretty much any reason. But not because I think it's going to increase government revenue. I agree with Milton Friedman -- if cutting tax rates increases revenue, that means you haven't cut taxes enough.
November 13, 2007
Democrats: party of the rich
I've been saying this for some time, but now the Financial Times has taken note:
[T]he demographic reality is that, in America, the Democratic party is the new "party of the rich". More and more Democrats represent areas with a high concentration of wealthy households. Using Internal Revenue Service data, the Heritage Foundation identified two categories of taxpayers - single filers with incomes of more than $100,000 and married filers with incomes of more than $200,000 - and combined them to discern where the wealthiest Americans live and who represents them.Democrats now control the majority of the nation's wealthiest congressional jurisdictions. More than half of the wealthiest households are concentrated in the 18 states where Democrats control both Senate seats.
Let's face it, folks. It ain't the party of Walter Mondale anymore. The hue and cry to repeal the AMT has come largely from the Democrats, even though the tax primarily affects those in the $200,000 to $500,000 income range. Not too many years ago, Democrats would have derided such a measure as "tax cuts for the rich." Ditto Barack Obama's donut hole, which would absolve those making more than $102,000 per year from paying the same payroll tax that everyone else must pay on every dollar they earn.
So what did you expect? For some years now, the Republican base has been low-income NASCAR fans and Wal-Mart shoppers, while the Democratic base has been Northeastern and West Coast professionals who fret about the AMT and the salaries of hedge fund managers. How long can that reality obtain before the Democrats offically become the "party of wealth and privilege?"
I'm not complaining, by the way. I've been disenchanted with the Republicans' social policies for years now, so I welcome the advent of a nascent, pro-wealth Democratic alternative -- a party that views private wealth as something to be celebrated and encouraged, rather than plundered and redistributed. If current trends continue, I see myself as a registered Democrat before the end of the decade.
November 07, 2007
MSNBC vs. Fox
THE QUESTION: "How do we get people to tune in?"FOX'S ANSWER: "Let's have all the news delivered by the hottest babes we can find."
MSNBC'S ANSWER: "Hey, let's get Rosie O’Donnell!"
I know which network I'm placing my money on.
(Hat tip: Jill)
November 05, 2007
Mukasey and obscenity
Under prodding by Orrin Hatch, Mukasey agreed to look into prosecuting "mainstream obscenity." Glenn seems to think Mukasey's just humoring the guy, and he may be right. After all, if Mukasey had given the appropriate response ("With suicidal fanatics plotting and scheming to slaughter us by the thousands every day and night, I have bigger priorities than prosecuting somebody for selling a skin mag, you pea-brained Mormon yenta.") it probably wouldn't be well-received. Still, I wish I had more concrete reasons to believe Glenn on this one.
One year later
Each night, the nightmare is the same. Spurred by presidential incompetence, congressional corruption, and a deeply unpopular war, voters go to the polls and throw Republicans out in droves. The new Democratic majorities in both houses go to work immediately, implementing a slew of progressive reforms, utterly changing the face of American politics, and moving the entire nation in a diametrically opposite direction after years and years of Republican hegemony.
I wake in a cold sweat, heart pounding, breath coming in ragged gasps, until reality slowly comes back into focus. Whew, that's a relief. The Democrats have done jack shit! Then, as with those "I'm suddenly back in school and forgot an exam" dreams, I smile and go peacefully back to sleep.
November 04, 2007
Global warming and evolution
What do they have in common? Well, I think I've noticed a parallel in the way both topics are debated, at least among laymen. Think back over all the times you've ever heard an environmentalist trying to convince a skeptic that man-made C02 emissions are frying the planet. Notice how often they employ phrases like "overwhelming consensus," or "no serious debate" or "the scientific community is nearly unanimous." Their arguments typically rely very heavily on the logical fallacy of "appeal to authority." It doesn't necessarily mean they're wrong, of course; it just means their reasoning is fallacious.
(These folks also have a tendency to deliberately mischaracterize the debate as well. When they say "The scientific consensus is that global warming exists," what they typically leave unsaid is "...and therefore we must ratify Kyoto and accept the wisdom and teachings of the Prophet Gore, Peace Be Upon Him." In reality, however, the fault line of the current debate is not so much over the existence of global warming, but rather over how much alarmism is warranted. In any case, I digress. This post is about the "appeal to authority.")
I've also observed the same patterns during all those (unfortunate) occasions when I've observed an actual debate between evolutionists and creationists. The evolutionists are correct, of course, but they're often depressingly lacking in their "arguments," often losing the debate on points, while being factually correct in their assertions.
I am a scientist by training, so I am able to marshal arguments as to how the truth of evolution has been demonstrated through the usual scientific methods, such as prediction and observation. From what I've seen, however, most people can't. But that doesn't stop them from arguing the subject, of course. They look down their noses at the religious types who believe in creation simply because some authority (the bible in this case) told them so, when 99% of the time they are guilty of exactly the same intellectual laziness. They espouse evolution with a religious fervor only because some authority ("consensus," or the "scientific community") says it's so. That's much easier, of course, than citing a specific bit of evidence, or the outcome of a scientific experiment to support one's claim.
Ironic, isn't it? Despite the infinite disdain of evolutionists for creationists, the vast majority of both camps believe what the believe for precisely the same reason -- because some authority they trust told them it was true.
November 02, 2007
Post-Halloween musings
I've come to suspect that Pixy Stix contain recycled floor sweepings from the Smarties factory, thus making it one of the "greenest" candies on earth. It even has that biodegradable, straw-like packaging that gets soggy and clogs up when you put it near your mouth.