Tag Archives: economics

Another Hypocrisy of the Left

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Among the tax reforms in the current plan before Congress is the elimination of the state and local tax payments as deductions from individuals’ Federal income tax returns.  Who actually benefits from these deductions, though?  Taxpayers in New York, California, and a couple of others.  States dominated, for the most part, by the Progressive-Democratic Party.  There’s an ox being gored.

Who else benefits from these deductions?

…88% of the benefits in 2014 flowed to taxpayers who earn more than $100,000, while 1% went to those who earn less than $50,000….

That’s not quite the Progressive-Democrats’ hated 1%, but they’re included—and the poor, whom the Progressive-Democrats pretend to want to help, get almost nothing for the deduction: they don’t have enough income to be able to use it—even if they live in those Blue States whose governments so loudly pretend to be on their side.

The Progressive-Democrats aren’t even consistent in their opprobrium.

The deduction is worth about $100 billion a year—the sixth largest individual income tax break. The Tax Foundation estimates that eliminating the write-off would raise $1.8 trillion in revenue over a decade.

Not even the prospect of all this money for Federal coffers—$180 billion per year to offset those $100 billion of deductions—is enough to draw the Progressive-Democrats in.

Heaven forfend that they take an alternative course.  They could jump on that large increase in the Federal take with both feet, and in parallel (especially since the deduction goes away) those Blue State governments could lower their own tax bites….

Some Thoughts on the Paris Climate Accord

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Some information provided by Matthew Dalton in The Wall Street Journal is illuminating, if not in the way he—or the WSJ—might have intended.

The US’s willingness under the Obama administration to propose major emissions reductions and put money on the table helped solidify global consensus behind the deal. It also helped persuade politicians world-wide of the need to seek more ambitious cuts and channel more money into the fight against global warming, officials and experts say.

Our willingness to put money on the table “helped persuade politicians world-wide [to] channel more money into the fight against global warming” contains a couple of disingenuousities.  One is that the greater amount of money to be channeled is American taxpayers’ money, since the other nearly 200 nations party to the thing aren’t putting up much money at all—in fact, large polluters like India pledged themselves to do nothing under the accord until some trillions of dollars in “foreign aid” had been transferred to them.  Pakistan, unmentioned by Dalton, pledged to “reduce its emissions after reaching peak levels to the extent possible.”  But that only defines the word “peak;” it commits to nothing—other than to be one of the receivers of (American taxpayers’) OPM.

The other disingenuousity is the cynically presented strawman of “the fight against global warming.”  The folks objecting to our leaving the accord will have to play with their dolly without me.  There’s no fight against global warming.  There is an effort to mitigate human activity’s impact on climate change, even though that impact has not had its significance established, or even suggested in any credible way.  Even the direction of climate change is not established: it was just a short time ago that the same Climate Federal Funding Industry was trying to raise funding by frightening us into worrying about the coming Ice Age.  (This is also the same collection of rent-seekers who tried to raise money with fear mongering about catastrophic global overpopulation.)

There’s also this from Dalton:

Despite the strong reaction of world leaders, the US’s financial contributions have been relatively small so far and its decision to withdraw doesn’t necessarily halt America’s progress on the emissions front.

Indeed.  The uproar is over the fact that the others won’t have such easy access to OPM—us American taxpayers’ money.  Never mind that in their bleating, these “world leaders” ignore the simple fact that we’re the leaders in cutting both pollution and CO2 emissions—we’re already at 1990s levels of CO2 emissions, and it hasn’t even been established that this plant food even is a pollutant.

And this:

When they signed the accord, governments acknowledged that the most difficult work was left unfinished. The pledges to slash emissions made by more than 190 nations fell far short of the reductions scientists say are needed to avoid the most damaging effects of climate change.

That bit of dishonesty speaks for itself.

Looks like President Trump isn’t as dumb or irresponsible as these worthies claim.  The Paris Climate Accord was, and is, nothing but cynical virtue signaling by the intended recipients of OPM and by the developed nation leaders’ who promised pennies of their own and dollars of ours.

“About That ‘Gutting the Safety Net'”

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That’s the title of a recent Wall Street Journal op-ed.

Critics are accusing President Trump’s 2018 budget of “gutting the safety net” with cuts to food stamps and disability insurance. In reality, the White House is proposing long-needed reforms that would fix a dysfunctional disability system that traps Americans in dependency.

The editor is right as far as he goes, but he doesn’t go far enough.  It isn’t just our social security disability system that is a welfare trap, it’s our entire welfare system.

There is no incentive for folks to get off welfare; in fact, there is a “welfare cliff” designed in that throws up terrible obstacles blocking folks from getting off welfare.  Those obstacles are more concretely illustrated by this:

The less-noticed harm is that a mere 1% of beneficiaries return to work every year….

One reason so few return to the labor force is that payments are essentially a tax on work. A 55-year-old who previously earned about $30,000 a year at work could receive more than $15,000 a year in disability payments, plus health-care benefits and perhaps other cash transfers such as food stamps. That means any job would have to pay more than what he loses in subsidies….

It’s not a safety net.  It’s the Progressive-Democratic Party’s seine, with which it seeks to trap our poor so they can continue trading handouts for votes.

On Whose Side Are These Guys?

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There is a move afoot in Congress to “overhaul” Dodd-Frank, at least to the point of adjusting the threshold size that banks would need to exceed in order to become subject to strict rules on “the capital, mergers, and other business” in which Government will permit these otherwise private enterprises to engage.  Under the present threshold of $50 billion or more in assets, some 37 financial institutions are subject to such Government diktat.

The trick will be reaching a compromise on what should come next.

Republicans tend to favor either setting a threshold of between $250 billion and $500 billion, or basing the designation on a bank’s riskiness rather than on its size. That new range would leave around a dozen or as few as a half-dozen banks facing stricter regulation.

No, there must be no compromise. Strict elimination of Dodd-Frank should come next.

Worse, raising the threshold would, indeed, shrink the number of institutions subject to Government regulation. That, though, would make it easier for Government to expand to completion its control over these institutions.

That’s the stuff of corporate fascism: Government control over what a putatively private enterprise will be allowed to produce and how much of it that enterprise will be allowed.  It’s dismaying that Republicans would propose such an affront to free enterprise and limited government.

Medicaid Transfers

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It’s well understood that Medicaid badly wants reform.  My own view is to give it back to the States by reducing Federal fund transfers to them until the transfers are zero, which also would eliminate Federal strings jerking the States to do everything the same way, the Federal way.

There are lots of paths to that end, and there are a number of other reforms that would help the situation at least a little.  The House plan for repeal and replace of Obamacare, the first step of which was the American Health Care Act, has one such step, the repeal of Obamacare’s Medicaid expansion.

Expanding State participation in Federally provided—with those strings attached—funds—expanding Medicaid—as a number State governors have done, is not one of those reforms.  Not even for Republican governors.

Sixteen GOP governors represent states that expanded Medicaid under the Affordable Care Act, and they are generally loath to see the program cut back.

Nobody forced these persons to mainline the Federal funds drug. They stuck that needle in their veins and addicted themselves, with no outside pressure at all.

These guys are badly mistaken, and they’ve only made things worse for the constituents for whom they claim to work.

Michigan Governor Rick Snyder, one of those 16, thinks the expansion is just peachy keen; he’s still riding the high from his needle.  He says that “600,000 Michiganders have gained coverage and the state’s hospitals have saved about $300 million.”

What he’s carefully ignoring, though, is how much money Michiganders and those hospitals sent to the Federal government in various taxes and fees to contribute to 49 other States’ Medicaid program participation.  How many of those Michiganders could have been helped and how much money could Michigan’s hospitals have saved had the State kept those monies, instead?  How much would those Michigan citizens and those Michigan hospitals have benefited, had they been able to keep their money—their money, not the State or Federal government’s money—instead of paying all those taxes and fees to the Federal government?