Tag Archives: economics

That’s Not Your Money

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Echoing Progressive-Democratic Party Presidential candidate and New York Mayor Bill de Blasio’s claim that there’s plenty of money, it’s just in the wrong hands, more Progressive-Democrat Presidential candidates are moving toward taxing the mere existence of that money.

For the richest Americans, Democrats want to shift toward taxing their wealth….

After all,

At the end of 2017, US households had $3.8 trillion in unrealized gains in stocks and investment funds, plus more in real estate, private businesses, and artwork[.]

Gimme that money, say the Progressive-Democrats. You didn’t earn that. And besides, whether you did or not is irrelevant. We have better uses because just shut up.

Senator Ron Wyden (D, OR) has given the game away.

The whole tax system is stacked in favor of the tax-avoidance crowd[.]

Because it’s government’s money, not private money.  Never mind that were tax rates not so usuriously high, no one would have to work hard to pay the minimum the law requires (honest efforts that guys like Wyden, in wide-eyed innocence, call “tax avoidance”).

Aside: the article opens with this:

The income tax is the Swiss Army Knife of the US tax system, an all-purpose policy tool for raising revenue, rewarding and punishing activities, and redistributing money between rich and poor.

Which is what I’ve been saying, along with many others, all along. Our tax code is for social engineering not so much for raising revenue for Constitutional purposes.  And that’s a fatal flaw.

Second aside: Progressive-Democrats ignore how much more taxes the Evil Rich pay than the rest of us, as illustrated by this graph from the same article. It’s never going to be enough because you’re still talking—shut up, I said.

There’s BDS

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…and there’s BDS.  As Antonia Tamplin wondered in her Letter to the Editor of The Wall Street Journal,

Regarding Jillian Kay Melchior’s “Dissent Against Beijing Is Becoming a Firing Offense” (op-ed, 19 Aug): Where is the international BDS (Boycott, Divestment and Sanctions) movement against China?

What she said.

Student Loans and Scams

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Folks are growing concerned about the magnitude of, and problems associated with, the massive student loan situation, and the some are even calling it a scam.

Defaults have fallen for most forms of consumer debt as the economic expansion continues. Mortgage delinquencies last quarter hit a historic low. But severely delinquent student loans have soared since 2012 and are now 35% of “severe derogatories”—more than credit cards (23%), auto loans (21%), and mortgages (11%).

This “scam” is laid at the feet of the CBO during the Obama administration.  It’s certainly true that the CBO misread the situation, perhaps even negligently so.

Here’s the short and sweet of it, though.

The student loan overhang is a serious problem.  However, the real scam is that of so many Progressive-Democratic Party Presidential candidates who want to forgive all those loans—transferring the loan problem directly onto the backs of taxpayers, instead of leaving it where it belongs: the responsibility of the students and parents who borrowed so foolishly and of the lenders who so foolishly loaned.

An Economic Misunderstanding

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The Congressional Budget Office said Wednesday that the two-year budget deal will increase our annual deficits significantly over the next ten years.  That puts a premium on Republicans regaining the majority in the House, retaining/expanding its majority in the Senate, and retaining the White House, with an emphasis on Conservative Republicans in that mix.  That’s for another post, though.

What…triggered…me was this bit at the end of the article CBO Director Phillip Swagel:

The nation’s fiscal outlook is challenging. To put it on a sustainable course, lawmakers will have to make significant changes to tax and spending policies—making revenues larger than they would be under current law, reducing spending below projected accounts, or adopting some combination of those approaches.

Close, but no cigar—not even an ersatz vaping cigar (do they make these?).  To get onto a sustainable course, the only change to tax policy is to continue reducing the rates: make the individual income tax rates permanent, then move onto a course to (permanent) low flat tax rate on all income, regardless of source. Add to that elimination corporate income taxes altogether; it’s corporations’ customers who pay the bulk of those taxes, anyway, in the form of higher prices.

Then cut spending to levels below the resulting revenues, with an emphasis on cutting non-defense spending.  It’s time the government stopped misspending us citizens’ money.  It’s also time the government stopped competing in the economy for products, services, and resources to produce those products and services.

With more money left in our hands, and with less competition from Government driving up our prices, the private economy will truly take off—increasing along the way revenues to the government from that greatly increased economic activity.

That increased economic activity and revenue to Government will have an additional mid-term salutary effect, if politicians are sensible and don’t lose their nerve.  The increased revenue could ease the pain of transitioning our Social Security and Medicare programs to privately done facilities, getting Government further out of our personal economic and health lives.

The increased economic activity also would redound to the States’ collected revenues—facilitating over the same mid-term a conversion of Federal Medicaid transfers to block grants to the States on an annual declining balance to zero schedule.

Standing Tall

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Great Britain has said that it will abide by British law regarding cross-border movement of persons. European Union law will no longer have applicability, with effect from 31 October, Great Britain’s departure date from the EU.  Unless the EU agrees, and begins concretely, to negotiate in good faith a serious departure régime.

Oh, the hoo-raw.  How dare those Brits follow through instead of kowtowing to their betters in Brussels?

Rebecca Staudenmaier, writing at the link, also mischaracterizes the move.

The move is a departure from UK Prime Minister Boris Johnson’s predecessor, Theresa May, who had said the government would end free movement “as soon as possible” if the UK left the EU without a withdrawal deal, suggesting the rules could be phased out.

This is no departure from May. On the contrary, this is a solidification of her position: it clearly defines what “as soon as possible” means.  Phase out? That phasing has just begun, if Brussels will get serious about negotiating the departure.  Indeed, that transition period has been going on, tacitly, since Great Britain made clear its intention to go out from the EU.  Phasing merely has been formalized with this announcement.

Indeed, here’s what the British Home Office actually has said on this subject [bold face emphasis added]:

EU citizens and their families are welcome to stay and there are no changes to the deadline to apply to the EU Settlement Scheme.
This scheme covers all EU citizens and their families living in the UK by 31 October, and EU citizens have until at least 31 December 2020 to apply.
Here is a short explainer:
What is happening? Is freedom of movement ending on October 31?
We are leaving the EU on 31 October come what may. This will mean that freedom of movement as it currently stands will end on 31 October when the UK leaves the EU.

And

EU citizens will still be able to come to the UK on holiday and for short trips, but what will change is the arrangements for people coming to the UK for longer periods of time and for work and study.

Hmm….

Even though the transition period has begun, it will extend for 15 months after Great Britain leaves, and it’s quite a generous transition, to boot.  Much more so than Brussels’ departure demands and May’s meek acquiescence to.

Of course, there are problems with this.

In a phone call with the EU Settlement Scheme office helpline, activist and former Change UK candidate Nora Mulready said she was told that EU citizens would have difficulty reentering the UK if they hadn’t applied by the Brexit departure date.
Those who hadn’t applied “would no longer be entitled to [freedom of movement] rights to live and work and be in Britain,” she said the office told her.

That’s a very serious problem.  Mulready apparently thinks EU citizens are so grindingly stupid or otherwise incompetent that they can’t figure out that they need to make their applications—in the 71 days that they have.  That just isn’t enough time for an adult continental.  Wow.

Unnamed Liberal Democrats (here’s NLMSM policy again) claim this policy is reckless.

Not at all. What’s been reckless is the EU’s bad faith pretense of negotiation for a smooth exit, instead using the talks and outcome to punish the Brits for their effrontery and to serve as a warning to other nations contemplating the presumption of leaving.

Here’s hoping a Johnson government is good to its word.