Like most (all?) Washington politicians, Paul Ryan is a liar and a hypocrite. Read about it here. Skip to page 6 for the ultimate example of Ryan’s nearly pathological fakery.
Like most (all?) Washington politicians, Paul Ryan is a liar and a hypocrite. Read about it here. Skip to page 6 for the ultimate example of Ryan’s nearly pathological fakery.
A key Republican talking point is that the wealthy are “job creators” and that any tax on these job creators will cause them to fold their cards and go home, hurting the economy in the process. This is clearly ridiculous, and I have challenged before the concept that tax rates diminish incentives to build companies, but here is a great essay from an entrepreneur and investor (a successful one — he is clearly in the 1%) describing how people don’t create jobs, the economy does. And the economy is made up of regular folks — the 99% — who need to buy the products produced by the entrepreneurs. Without a successful consumer class, nobody will be a job creator.
Posted in Business, Politics, Pop culture
Tagged Business, consumption, economics, economy, income inequality, republicans, taxes, tea party
OK, maybe not all of us. But a lot of us. Really a lot. Cornell political scientist Suzanne Mettler has an article in the Washington Monthly about what she calls the “submerged state,” or the massive amounts of money at play in various tax deductions (eg. the mortgage interest deduction) that benefit particular populations.
As the chart below shows, there are all kinds of tax deductions that many people take, but those same people continue to insist that they don’t get any help from the government. Mettler’s point, backed up by her survey data: despite their cost, these programs are invisible to the public, making the public more susceptible to claims that government is too big.
Yves Smith on the macro effects of oversized Wall Street pay.
I normally don’t love Paul Krugman, despite his Nobel Prize, since he is too strident and preachy and predictable, but this take on what really separates Right from Left in America is pretty interesting.
John Mearsheimer on American foreign policy and realpolitik.
John Cassidy on whether Wall Street adds value to society. Hint: it doesn’t. This is from the New Yorker, so it won’t be available online forever.
Law professor David Beatty compares American constitutional jurisprudence to how they do it in other countries. I’m no expert, but I found it fascinating.
Posted in Business, Politics, Pop culture, Trends
Tagged ayn rand, bonuses, Business, economics, goldman sachs, GOP, greed, Politics, republicans, Trends, wall street
Jack Balkin has a great post describing how Congress, particularly the Republicans, are acting like a European style parliament. His forecast: more gridlock, worse policy, and a decaying country.
The Wall Street Journal recently ran an article by Jonah Lehrer asking whether humans might not be as averse to paying taxes as our political discussion currently assumes. He describes a study by scientists at Caltech which showed that people dislike inequality. Study participants were put into scanners, and the pleasure areas of their brains lit up more when money was given to others than when money was given to them. This was especially true of those who had started the study “rich,” which was determined by random assignment. Following this study to its logical conclusion, perhaps people who are well off might not be as unhappy as politicians seem to think about paying higher taxes to help the less fortunate.
However, Lehrer points out that the random assignment of riches skews the study. Other studies have shown that this altruism effect is less powerful when the rich feel that their wealth is earned. When we bring this back to politics and tax rates it opens a whole can of worms. What is “earned” in a society where massive advantages (not just wealth) are passed down through the generations? I won’t open that can of worms here, but point you to this post from last year on some of the challenges of “earning” wealth for the lower classes.
Tagged Business, consumption, economics, Politics, republicans, taxes, tea party
The bipartisan deficit panel has come out with its first set of recommendations, and everyone is hopping mad. Lefties say the cuts in spending are unacceptable, and conservatives are adamant that tax revenues never go up again. Good! I have no opinion about the specific recommendations made by the panel chairmen, but I know that if both sides are pissed off then the panel must be doing something right.
Listen people…this deficit is serious business. It will bite us in the ass if we don’t fix it, and fixing it is going to require some pain on everyone’s part. We’ve been living for too long with this fantasy that government could increase spending while cutting taxes. Now the party is over, and the hung over cleanup has to begin. Headaches? Nausea? Yes, exactly.
So liberals, accept the fact that spending will be cut, and not just military spending. I hate it too, but Social Security has to be on the table. Increasing the retirement age by two years over the next 65 years? That’s really not so bad. Tying other benefits to inflation? Also not unreasonable. We need a safety net, of course, but we need to be smart about it.
And conservatives, you too are in for some pain. Face facts: spending cuts alone won’t balance the budget. We need to increase taxes. You like to claim that any tax increase will kill the economy, but the facts don’t bear that out. This chart shows that in Germany tax revenues are 40% of GDP, far more than America’s 28%. And yet Germany’s economy is doing fine, kicking our ass in exports, despite having to absorb East Germany. This chart shows that marginal tax rates for individuals are lower than ever. In fact, during America’s economic heyday, in the 50s and 60s, top marginal rates were in the 70%-90% range, far higher than today’s 35%, and yet there was still plenty of investment, of people working hard, of entrepreneurs starting businesses. All the arguments the right uses against raising taxes are belied by that glorious period of American business. Speaking of that great Happy Days era, the chart below shows that the share of taxes paid by the wealthiest citizens back then was significantly higher than it is now. Again, showing that higher taxes do not necessarily stifle economic growth.
There will be plenty of unpleasantness to go around; Democrats and Republicans will each get their share. Our legislators need to get off their high horses, stay away from the cameras and microphones and acknowledge that their pet causes are secondary to the national cause. But as either Mark Shields or David Brooks (I still can’t tell their voices apart on radio) said on the PBS NewsHour, our politicians won’t make this happen until the public forces them to. Our culture needs to accept the need for hard choices, and then push our politicians to make them.
If you have the time, read James Kwak‘s interview in The Straddler. He has some interesting things to say about how our culture is oddly enamored of the idea of the swashbuckling wall streeter, and yet intimidated by economics and finance, and how that has influenced policy decisions. He’s a smart cat. Here is a small sample:
“And Wall Street’s argument that it has this mysterious power, that you have to trust it that it’s using it for good, and that if you take it away, the world will end, is obviously obnoxious—but it’s a hugely successful debating point. Congressmen are afraid of it. They’re afraid that they don’t understand what’s going on, and they’re hearing these lobbyists say that if you push too hard on the banking industry, the world will end.”
Posted in Business, Politics, Trends
Tagged 13 bankers, Business, consumerism, culture, economics, james kwak, Politics, regulation, republicans, taxes
There is a new book out called Because It Is Wrong: Torture, Privacy, and Presidential Power in the Age of Terror. Written by Charles Fried, a Harvard law professor who served in several legal roles in the Reagan administration, including Solicitor General, and his son Gregory Fried, a philosophy professor at Suffolk University, the book explores “the ethics of torture and privacy violations in the Bush era.”
Harvard Magazine recently ran some excerpts from the final chapter, where the Frieds move off of torture per se and more into the general obligations of a president to the people.
They discuss that at times a president might break the law because he thinks the law will not allow him to do what is necessary to save the country, as did Jefferson in 1807 and Lincoln in 1861.The Frieds liken this law breaking to civil disobedience, with “a fundamental allegiance to the political community and its system of laws and government.” Executive law breaking while maintaining ultimate fidelity to the state and its system is civil disobedience; law breaking outside this fidelity is a coup.
But the Frieds also emphasize that civil disobedience, with fidelity to the state, requires admitting your law breaking. Like civil rights protestors who willingly went to jail, executive law-breakers under the Fried model…
“…break the law in a way that emphasizes their allegiance to the rule of law and the existing system of laws and institutions in general, with the exception of the law or set of laws in question. They break the law openly. They break the law reluctantly only for reasons of deep principle and in situations of great urgency, after making a good faith effort to change the law by legal means. They do not resist or avoid the representatives of the state when they arrest them. The practitioners resist by pleading their case in court, and they accept their punishment if the court goes against them, trusting that their fellow citizens will see the light eventually.”
The Frieds note that unlike MLK, a president takes an oath to uphold the law. Yet quoting Aristotle, they claim that the law cannot always foresee what is in the public interest. But if the executive gets to decide what is in the state’s best interest, what is to prevent the executive from becoming a tyrant? Here is where their call for open law-breaking is essential. The risk of being found guilty by the jury of citizenry will keep executives from going too far. “A chilling effect is exactly what we need when it comes to the rule of law.”
In other words, the Frieds believe that an executive law-breaker should stand up and say “yes, I did commit that act” and let the citizens decide. They compare this, unfavorably, to the law-breaking in the Bush administration, wherein the law-breakers to this day refuse to acknowledge what they did. The Frieds make clear that they are not necessarily calling for prosecutions of Bush officials; they only point out that “there is a great danger to secret executive lawbreaking. What is done in secret could metastasize into the arbitrary, lawless power of the tyrant—as it did in the Weimar Republic, with Hitler’s rise to power.”
Posted in Philosophy, Politics, Uncategorized
Tagged ethics, george bush, jefferson, Philosophy, politicians, Politics, republicans, torture