Friday, March 27, 2009

Taxes Affect Behavior?

http://www.usatoday.com/news/health/2009-03-27-tobacco-tax_N.htm?csp=34

When we hear talk about raising corporate taxes the two sides always argue over whether those taxes will impact job loss or corporate behavior. I always hear the liberal side say that corporations need to "pay their fair share". But we all know that corporations don't pay taxes, they pass the cost on to consumers or change their behavior to avoid the tax altogether.

For all the posturing about taxes not impacting behavior when it's corporations in the crosshairs, when it's a sin tax, behavior is always touted as one reason to pass the tax.

Here we see the continuation of sin tax being used to fund good things. It's a win-win because it reduces bad behavior and funds good programs. The problem is that these good programs will be in trouble if the behavior actually decreases in the future.

Either way I see the liberal argument losing. If the behavior reduces then it proves that taxes on a good or service reduces the demand for that good or service. If behavior doesn't change then one of the primary reasons for passing a sin tax is proved wrong.

Tuesday, March 17, 2009

Perspectives in Democracies

http://www.usatoday.com/news/world/2009-03-17-madagascar-president_N.htm?csp=34

I confess that I have not followed the rivalries of the parties in Madagascar. In that respect I am an "ugly American" who is apparently unconcerned with affairs outside my bubble. But I noticed this article and was struck by how it contrasts Madagascar and, presumeably other democratic nations, with the United States.

Our system of government is much maligned by everyone it seems. On the radical right you can hear the cries of "take back our country" and even in some more remote corners the call to arms. On the loony left are often similar calls to overthrow our government using various means of force. But these remain on the fringe and our system as a whole continues to operate. One side is less grumbly for a time, then the other side takes a turn.

For the most part we have an understanding that although our system has flaws and we are free to enumerate them publicly, we have a "gentleman's agreement" that when we grumble, we won't take up arms but rather wait 4 years. Of course we can all forsee the possibility of things going too far and falling to pieces in a cascade of anarchy but we don't really believe that will happen.

What strikes me about the Madagascar example is that we see the result of one side rising up to overthrow the other. Although it's somewhat more peaceful than other coups, there are military on both sides and if Ravalomanana did not resign we don't know the extent that Rajoelina was willing to go.

It adds some perspective because as close as the elections were in 2000 and 2004, no one even counted as possible that we would see bullets fly. As contentious as the 2008 election was we never even fathomed the option of military involvement. Even when our officials misuse public funds, they are prosecuted, not executed.

We may have some real turkeys in office at any given time, but they are OUR turkeys, rightfully (we assume) voted into office by a majority of citizens (we assume) who were properly registered to vote (we assume) and we follow them. At least for a time.

Sunday, March 15, 2009

Spend Now to Spend Later

So, congress might have to shut down government if this spending bill didn't pass (it did). Obama will be mad if he signs it with all the pork (he did). The people will be forgotten and left out on this one (we were).

This emergency spending bill had to be passed quickly so there's no time to post it on the web for 2 days as Obama promised bills would be. There's no time to cut the pork as Obama promised to do. There's no way Obama will veto either. Seems there's not a situation in Washington that's not a damn emergency these days.

That's ok, next time when things slow down a little. Let Obama catch his breath. He's only been in office for...

Bullshit. He needs to put on his big boy pants and start keeping his word.

Friday, October 24, 2008

Palin Paroxysm

The latest from the balanced world of network news is that women are supposed to enter into the world of politics as men, not women. Palin is being roasted over her wardrobe, her makeup artist, her "desertion" of her family, her bad mothering... If this were reversed, if Hillary had been nominated by the Dems and Fox News were talking about her clothes and makeup, the MSM would cry "Anti-Feminist". But, since Palin is conservative everything is fair game.

The claim is that Palin can't be a "typical hockey mom" since she now has an expensive wardrobe and personal stylist. However, the argument is self referentially absurd. The fact that a wardrobe had to be purchased on her behalf after she got the VP nod, and the fact that a stylist is required to make her look good actually prove the point. She didn't have these things before, she needs help!

But, if this is the best they have to throw at her it just makes them look desperate. I just wish someone would take note of the hypocrisy.

Saturday, July 26, 2008

Divide and Protect

The speech given by Barack in Berlin has apparently caused ripples that are turning into waves. Unfortunately most Americans won't read or listen to the speech. Those who are planning to vote for him will take pride in the 200,000+ who came to listen. Those who are not will only hear soundbites.

I'm not really writing about the speech itself here, but rather to respond to Steve Clemons comments. http://www.democracynow.org/2008/7/25/steve_clemons_obamas_wall_speech_should

Part of Barack's speech was about the importance of the Berlin wall being torn down. "That is why the greatest danger of all is to allow new walls to divide us from one another. The walls between old allies on either side of the Atlantic cannot stand. The walls between the countries with the most and those with the least cannot stand. The walls between races and tribes, natives and immigrants, Christians and Muslims and Jews, cannot stand. These now are the walls we must tear down."

Clemons says that Barack should have given this speech in Israel and that this would have been really something. "Had he given those remarks in Israel, at any of the checkpoints that have been added since the Annapolis process began, or at the large dividing wall Israel has constructed, or just about anywhere frankly in Israel or Palestine—it would have been a ‘game-changing speech.’"

I agree. It would have been game changing. It also would have shown a failure to know the difference between a good fence and a bad fence. There are fences that protect, and there are those that divide. I agree we ought to fight to have dividing walls torn down when their only purpose is to divide or to protect the power of despots. But I would not want the Cheyenne Mountain Zoo to bring down the dividing wall between the Grizzly Bear exhibit and the spectators. I do not want my neighbor to bring down the fence that divides his dogs from my children. And I would not expect Israel to tear down walls and fences that protect it's citizens from those who want to destroy them.

My hope is that Barack does not share in Clemons' ignorance. He lives in a dreamworld thinking that wishes can create reality and that good intentions can sway evildoers from causing harm. As presidential hopeful I hope Barack knows the difference between fences that divide for evil purpose and those that protect.

Friday, January 18, 2008

Here - Have a Sucker!

Bush calls for $145 billion stimulus package

President sees tax rebates as a way to give economy a 'shot in the arm'

I may not be the brightest bulb in the box but it seems to me that this is not a "shot in the arm". Rather it's like offering a lollipop to a cancer patient. Perhaps it makes the patient feel nice, cared for, even happy for a moment. But then, when the sucker is gone she realizes that she still has cancer.

I don't think our economy is fundamentally flawed to the extent that I'm no longer a capitalist. And I don't think the solution is to raise taxes. But this little infusion of dollars won't change the fundamental problem that people are spending more than they make. In a way you could call it enabling.

More and more the solutions posited by either side of the political aisle are all about throwing some money at the problem. If the government spends more on education, the problems will melt away. If the government had control over health care then we would all live in a utopia of health care for free. If the government gives away some free money then all our individual economic woes will be gone. It's just crazy. And when these things don't work we find our nation with less freedom, higher taxes and more problems. Plus, once we've given government the control over that issue, we don't even get to offer our input without the whole messy political process getting in the way.

Now don't get me wrong. If there is free money being sent out I won't turn mine down. But maybe instead of running to Target in order to "infuse" dollars into the economy, we should pay down a credit card, invest in our retirements or buy our own dang health insurance. Oh who am I kidding, I've got my eye on a new...

Saturday, December 22, 2007

Illegal immigrants packing up and leaving Arizona

http://www.cnn.com/2007/US/12/22/immigrants.leave.ap/index.html?eref=rss_topstories

"As the jobs dwindle and the environment becomes more unpleasant in more ways than one, you then decide what to do, and perhaps leaving looks like a good idea," she said. "And certainly that creates a problem, because as people leave, they take the jobs they created with them."
- Dawn McLaren

Ok, Ms. McLaren is a professor at ASU so she is close to this issue and has studied it herself. She wrote a paper on the subject. But her paper attempts to show that the issue is not being clearly defined and thus the solutions are short sighted. She may be right in some respects. But her paper also makes it clear that she does not understand her own free market society that she lives in. That's sad for an economics professor. Her entire article addresses the job market but mentions nothing about supply and demand in the marketplace.

McLaren gives an example about a factory worker in Michigan being laid off. She says that just because there's a worker in Michigan and a job in Arizona does not mean that the worker will move to Arizona. She's right that there would have to be other factors to give the worker incentive to move. One of the major factors would be economic. If the pay rate were such that the worker realized he could provide for his family by moving to Arizona, I bet he'd move.

Price is not static, if demand increases, the price will increase. If supply diminishes, the price will increase. This is one of the factors that brings stability to a free market society. It's also the way that a market regulates itself into producing only those goods and services that are necessary. If a service becomes unnecessary, the workers providing that service must adapt.

What boggles my mind with the quote above is not only that McLaren doesn't understand this simple concept of economics (or understands but does not think it exists), but that she apparently believes that illegal immigrants create jobs when they come over. The absurdity of this thought is compounded when the very thing she is commenting on is a policy that takes away the job that the illegal came for in the first place. If the illegal immigrant brought the job with him, there would be no way for us to take it away.

It's just silly, but that's what happens when you live your life in a world set apart from the free market. Professors are not part of the free market so they can't understand the culture they live in.