Category Archives: Economics

Miscellaneous economy stuff

Punishing Success

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Los Angeles has decided that the successful are too successful, and they must be knocked down. To that end, the city’s government has decided to tax the sales proceeds of the wealthy’s homes at 4% on homes sold for $5-$10 million and at 5.5% on homes sold for more than $10 million. This is on top of the real estate brokers’ ordinary 6% fee, and it’s paid by the buyer. Not that that will have any impact on the seller’s ability to sell at a fair price, or anything.

LA isn’t alone in this “mansion tax” move, either. Other jurisdictions, mostly at the State level (it won’t be long before California broadens LA’s move), are doing this, also. They’re all Progressive-Democrat-run, too, all but one of them exclusively so.

  • Connecticut: 2.25% on properties surpassing $2.5 million. Progressive-Democrat Governor, Senate, House
  • District of Columbia: 1.45% on properties sold for $400,000 or more. Progressive-Democrat Governor, City Council
  • Hawaii: Marginal rates ranging from 10% to 20% for estates valued over $5.49 million. Progressive-Democrat Governor, Senate, House
  • New Jersey: 1% on real estate transactions exceeding $1 million. Progressive-Democrat Governor, Senate, House
  • New York: 1% to 3.9% on residential acquisitions of $1 million or more. Progressive-Democrat Governor, Senate, House
  • Vermont: 16% on properties valued over $5 million. Republican Governor, Progressive-Democrat Senate, House
  • Washington: Graduated rates starting at 1.28% for properties sold at a minimum of $500,000. Progressive-Democrat Governor, Senate, House

And, to repeat,

  • Los Angeles: 4% on homes sold for more than $5-$10 million and 5.5% on homes sold for more than $10 million. Progressive-Democrat Mayor, City Council

This is behavior of the green-eyed jealous politicians of the Progressive-Democratic Party: seizing the produce of success and redistributing it for their own political gain. It’s also just one more incentive for the successful to leave these jurisdictions altogether.

Nanny State in Automobiles

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Tesla is recalling a double potful of its cars over autopilot performance.

A Wall Street Journal analysis of dashcam footage and data from a crash in Texas in 2021 shows Tesla’s Autopilot system failed to recognize stopped emergency vehicles.

That sort of thing wants correction, certainly.

However, the larger problem is this:

Tesla will recall more than two million vehicles over concerns its Autopilot system can be misused by drivers[.]
…
Tesla’s Autopilot system may not have sufficient controls in place to prevent driver misuse, [National Highway Traffic Safety Administration] said.

Failures of the autopilot system need to be corrected, and that’s on Tesla. Driver misuse, though, is on the driver, not the manufacturer. Trying to shift that responsibility away from the user/driver is rank nanny state-ism.

Rebuilding San Francisco?

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San Francisco is moving to alter certain requirements and political priorities in order to increase residential housing construction. San Francisco even has changed some actual rules so developers can build market-rate apartments with fewer requirements to provide affordable housing. One project coming out of these moves is this one:

In what would be the city’s most ambitious residential development in several years, local property developer Bayhill Ventures last month announced plans for a 71-story rental tower in San Francisco’s ailing financial district.

Cabrini Green come to San Fran, degentrifying the financial district? Only with the critical difference that this area will have even fewer police with which to enforce laws and keep folks safe than Chicago provided Cabrini Green.

It’s not certain that that outcome will be realized. However, the construction comes inside an established environment of a reduced police force; laws decriminalizing, among others, drugs and shoplifting; and prosecutors reluctant to prosecute. (Yes, I’m aware that San Francisco residents recalled an especially egregious non-prosecuting prosecutor, but his replacement is better only compared with that low bar.)

We’ll see.

Oil Buyback

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Progressive-Democrat President Joe Biden now plans to buy 2.7 million barrels of oil to put back into our oil strategic reserve.

Couple things about that.

We had 630 million barrels of oil in our strategic reserve before Biden took office and started selling it to the People’s Republic of China while claiming he was doing it to slow the gasoline price inflation his spending was causing. As recently as 24 November last, our reserve was down to 351 million barrels. According to my second grade arithmetic, that means Biden had reduced our reserve by 279 million barrels in just those two years and 10 months. My third grade arithmetic tells me that those 27 million barrels he’s buying for the reserve is just 1% of what he’s taken out of it. Which makes buying that oil an insulting effort to distract us with his pretense of refilling our reserve after his dangerous reduction.

The other thing is that he’s buying that oil at $79/barrel, which means he’s spending $213.3 million to buy that 1%. To replace all 279 million barrels, he’ll have to pay more than $22 billion at those $79 per. When the prior administration (the Trump administration for those following along at home) refilled the reserve after the Obama admin draw-down, Trump’s buyers paid $30-$55 per barrel. Call it, for this back of the envelope estimate, an average of $42.5 per barrel. At that price, Biden could replace the oil he removed for a total cost of $11.8 billion dollars. Bidenomics is going to cost us ordinary American taxpayers more than $10 billion at today’s actual price. That is, if Biden follows through on refilling our strategic oil reserve.

Update: third grade arithmetic tells me that those 27 million barrels should have been third grade arithmetic tells me that those 2.7 million barrels. Fershlugginer keyboard….

Heat Pump Efficacy

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I’ve mentioned earlier the level of energy efficacy of heat pumps. Here is an example of the level of fiscal efficacy of heat pumps. The fronted lede:

A two-year project to convert a public housing building to an electrically powered heat pump system is nearing completion on the Upper West Side. The 58-year-old 20-story tower at 830 Amsterdam Avenue (100th Street), part of the New York City Housing Authority (NYCHA) Frederick Douglass Houses development, is being retrofitted to provide heating, cooling, and hot water for residents—and to serve as a possible template for converting more of the 2,410 buildings NYCHA maintains citywide.

The strewn about and buried lede:

The $28 million project….
…
…to replace the aging boilers at 830 Amsterdam Avenue with a heat pump system, called variable flow refrigerant, that would deliver heat, hot water, and cooling to the building’s 159 units.

According to my third-grade arithmetic, and using up all my fingers and toes, that works out to $176,100 per unit.

Then there’s this:

If the 830 Amsterdam project is deemed successful, it could be repeated at other buildings operated by NYCHA or private landlords.

Successful by what measure? That’s certainly not a financial success.

Even accounting for the intrinsic fiscal inefficiency of government projects, this is an expensive template; more, it’s just foolish and negligently wasteful. And disastrous for the city’s taxpayers and for those private landlords. And that’s on top of the city’s taxpayers already seeing truly essential services, like policing and facilities for homeless residents (however inefficiently this one is done by a government), severely financially curtailed in favor of another virtue-signal, housing for illegal aliens in the sanctuary city.