Category Archives: political economy

An Alternative

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Or two. The Trump administration is kicking around the idea of taking a stake in companies that receive Federal funds pursuant to the 2022 Chips Act (formally the Chips and Science Act), 10% in Intel being one of the ideas in play. I have an alternative, although it likely would require a legislative modification to the Chips Act: structure the funding as a loan, the [10%] stake as collateral, and dissolve the stake when the loan is repaid.

Another alternative, also likely necessitating modification to the Chips Act, would be to structure the funding as a grant, with the stake dissolved after a [five] year period on satisfactory performance under the grant—suitably boosted domestic research and manufacturing.

Either of these alternatives would mitigate the risk of government-run “capitalism” by getting government back out of these enterprises once performance has been confirmed durably established. They’re similar, too, to the government bailout program of the Panic of 2008, with the critical addendum of a hard withdrawal of government on clearly measurable achievement of tightly defined milestone.

Disingenuous

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The Canadian government has ordered binding arbitration in the dispute between Air Canada and its flight attendants union, the latter which struck the airline a week ago last Saturday. The union is crying foul over not having gotten its way, accusing the airline, in typical union fashion, of sandbagging (the union’s term) the negotiations.

On the other hand, there’s this, also, from the union regarding those negotiations.

The airline said it offered its flight attendants a 38% increase in total compensation over a four-year period. The proposal also offered a 12% to 16% rise in hourly pay in the first year. The union said the pay offers failed to help its members recover after historically-high inflation this decade.

Leave aside the minor fact that the airline didn’t cause the inflation, the Canadian government’s response to economic factors did, so the union’s beef regarding the effects of inflation is properly between it and the government.

What the union is choosing to ignore in its inflation beef is that the airline suffers just as much from that historically-high inflation and must also deal with the resulting price increases and current elevated price levels.

Raise Those Taxes

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Progressive-Democrat-run States are looking at ways to cover putative budgetary shortfalls.

  • Minnesota State Representative Aisha Gomez, a Democrat…sponsored legislation that would implement a higher tax rate for joint filers in Minnesota making over $1 million a year if federal Medicaid cuts take effect
  • Connecticut legislators have proposed a bill that would raise income-tax rates on couples making at least $500,000 and individuals making at least $250,000
  • Washington Governor Bob Ferguson, a Democrat, in May signed into law a budget that includes an increase in the capital-gains tax, among other things
  • Maryland Governor Wes Moore, a Democrat, in May signed into law his tax proposal, which includes higher income-tax rates for state residents making more than $500,000 a year
  • Rhode Island in June imposed a new tax on certain vacation homes valued at $1 million or more

And this:

Many states face projected budget deficits after increasing spending and cutting taxes in the flush postpandemic years….

Notice that. Profligate spending leads to revenue shortfalls, so—raise those taxes, especially on the rich, who Owe Us. That’s akin to a business losing money, so it raises the prices it charges for its products.

Nowhere in there is any Progressive-Democrat-run State reallocating its spending to stay within existing revenues, much less cutting spending to do so.

I repeat a long-standing challenge of mine: can any Progressive-Democratic Party politician even say the words, “Cut spending?”

State and Party Affiliation and Comings and Goings

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The following two tables show U-Haul‘s annual report on one-way interstate rentals, coupled with the party that runs the State. The first shows top 10 most favored destination States according to U-Haul‘s report, the second the 10 most departed-from States. In both cases, the number following the State is the State’s rank in U-Haul‘s preceding year ranking. 

Rank State Party Control
1. SOUTH CAROLINA (4) Republican
2. TEXAS (1) Republican
3. NORTH CAROLINA (3) Democrat Governor, Republican Legislature
4. FLORIDA (2) Republican
5. TENNESSEE (5) Republican
6. ARIZONA (8) Democrat Governor, Republican Legislature
7. WASHINGTON (7) Democrat
8. INDIANA (27) Republican
9. UTAH (13) Republican
10. IDAHO (6) Republican

 

Rank State Party Control
41. CONNECTICUT (42) Democrat
42. MARYLAND (44) Democrat
43. MICHIGAN (46) Democrat
44. LOUISIANA (45) Republican
45. ILLINOIS (48) Democrat
46. PENNSYLVANIA (38) Democrat Governor and House, Republican Senate
47. NEW YORK (43) Democrat
48. NEW JERSEY (47) Democrat
49. MASSACHUSETTS (49) Democrat
50. CALIFORNIA (50) Democrat

There would seem to be a hint here.

 

H/t Ricochet and Ekosj.

School Choice and a Teachers Union

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In Wyoming, the State’s legislature passed and the governor signed legislation to create school choice for the State’s parents and children.

Wyoming lawmakers created the state’s first K-12 education savings account (ESA) program in 2024, effective in the coming school year. This spring they expanded eligibility to families of any income. The $7,000 accounts can be used for private-school tuition, tutors, homeschooling, or other education expenses. Nearly 4,000 students applied for them this fall.

In the first year, those 4,000 students amount to about 3.5% of the State’s K-12 population (some arithmetic involved), a pretty rapid start to the take-up. The main teachers union in the State, the Wyoming Education Association, is busily objecting and hailing the State into court to get that legislation overturned. The union is claiming that the State’s constitution requires the Legislature to maintain a “complete and uniform” public school system, the State cannot fund “private education that is not uniform.”

This is a distortion of the facts, including of what the State’s constitution says. This is that constitution’s Art 7, Sect 1, in its entirety:

Legislature to provide for public schools. The legislature shall provide for the establishment and maintenance of a complete and uniform system of public instruction, embracing free elementary schools of every needed kind and grade, a university with such technical and professional departments as the public good may require and the means of the state allow, and such other institutions as may be necessary.

That’s the short and sweet of it. There’s nothing in there that would preclude the State from establishing, supporting, or merely funding alternative means of education. Indeed, that last clause, and such other institutions as may be necessary, being separate from the clause mandating a system of public instruction, explicitly authorizes alternative means of education structured entirely differently from, or the same as, the public system.

This is just another example of a teachers union trying to deny parents their right to see to their children’s education in their own way. It’s the union way or nothing. That’s just union abuse of education and of the students in it out of its own greed: those alternative means would not be controlled by the union.

The Wyoming constitution can be read here.