Author Topic: Political Economics  (Read 602543 times)

Crafty_Dog

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Re: Political Economics
« Reply #1750 on: July 31, 2018, 04:46:57 PM »
Doug, if I am not mistaken, your math is off a bit.

That 4% is an ANNUALIZED RATE.
« Last Edit: August 01, 2018, 08:26:48 AM by Crafty_Dog »

DougMacG

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Re: Political Economics
« Reply #1751 on: August 01, 2018, 06:09:50 AM »
"One more thing on 4% growth, that is the amount we spend on National Defense.  We just grew the economy by the amount of the entire military budget."

Thank you Crafty, I sensed that needed clarification as I posted it.

The growth in one quarter, 4% annualized, was roughly equal to the entire military budget - of one quarter.

IF we grew GDP 4% for an entire year, then we grew by roughly the size of our entire annual military budget, 4% of GDP.
« Last Edit: August 01, 2018, 06:55:08 AM by DougMacG »

Crafty_Dog

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WSJ: Gramm & Early: The myth of American Inequality
« Reply #1752 on: August 10, 2018, 05:05:58 PM »
The Myth of American Inequality
Taxes and transfers in the U.S. put its income distribution in line with its large developed peers.
547 Comments
By Phil Gramm and
John F. Early
Aug. 9, 2018 6:51 p.m. ET

America is the world’s most prosperous large country, but critics often attempt to tarnish that title by claiming income is distributed less equally in the U.S. than in other developed countries. These critics point to data from the Organization for Economic Cooperation and Development, which ranks the U.S. as the least equal of the seven largest developed countries. American progressives often weaponize statistics like these to urge greater redistribution. But the OECD income-distribution comparison is biased because the U.S. underreports its income transfers in comparison to other nations. When the data are adjusted to account for all government programs that transfer income, the U.S. is shown to have an income distribution that aligns closely with its peers.

The OECD measures inequality by determining a country’s “Gini coefficient,” or the proportion of all income that would have to be redistributed to achieve perfect equality. A nation’s Gini coefficient would be 0 if every household had the same amount of disposable income, and it would approach 1 if a single household had all of the disposable income. The current OECD comparison, portrayed by the blue bars in the nearby chart, shows Gini coefficients for the world’s most-developed large countries, ranging from 0.29 in Germany to 0.39 in the U.S.

How Unequal?Gini Coefficient, adjusted disposable incomeSource: OECD, authors
USA, perOECDUnitedKingdomAustraliaJapanUSA, morecompleteCanadaFranceGermany00.10.20.30.40.5

But there are variations in how each nation reports income. The U.S. deviates significantly from the norm by excluding several large government transfers to low-income households. Inexplicably, the Census Bureau excludes Medicare and Medicaid, which redistribute more than $760 billion a year to the bottom 40% of American households. The data also exclude 93 other federal redistribution programs that annually transfer some $520 billion to low-income households. These include the Children’s Health Insurance Program, Temporary Assistance for Needy Families and the Special Supplemental Nutrition Program for Women, Infants and Children. States and localities directly fund another $310 billion in redistribution programs also excluded from the Census Bureau’s submission.

This means current OECD comparisons omit about $1.6 trillion in annual redistributions to low-income Americans—close to 80% of their total redistribution receipts. This significantly skews the U.S. Gini coefficient. The correct Gini should be 0.32—not 0.39. That puts the U.S. income distribution in the middle of the seven largest developed nations—the red bar on the chart.

Gini scores for other countries in the OECD ranking also might shift with better data: The OECD doesn’t publish transfers by income level for other countries. But the change in income distribution for other countries would likely be less drastic. The poorest fifth of U.S. households receive 84.2% of their disposable income from taxpayer-funded transfers, and the second quintile gets 57.8%. U.S. transfer payments constitute 28.5% of Americans’ disposable income—almost double the 15% reported by the Census Bureau. That’s a bigger share than in all large developed countries other than France, which redistributes 33.1% of its disposable income.

The Myth of American Inequality
Photo: iStock/Getty Images

The U.S. also has the most progressive income taxes of its peer group. The top 10% of U.S. households earn about 33.5% of all income, but they pay 45.1% of income taxes, including Social Security and Medicare taxes. Their share of all income-related taxes is 1.35 times as large as their share of income. In Germany, the top 10% pay 1.07 times their share of earnings. The top 10% of French pay 1.1 times their share.

If the top earners pay smaller shares of income taxes in other countries, everybody else pays more. The bottom 90% of German earners pay a share of their nation’s taxes on income 77% larger than that paid by the bottom 90% of Americans. The bottom 90% in France pay nearly double the share their American counterparts pay. Even in Sweden—the supposed progressive utopia—the top 10% of earners pay only 5.9% of gross domestic product in income-related taxes, 22% less than their American peers. The bottom 90% of Swedes pay 16.3% of GDP in taxes on income, 77% more than in the U.S.

Even these numbers understate how progressive the total tax burden is in America. The U.S. has no value-added tax and collects only 35.8% of all tax revenues from non-income-tax sources, the smallest share of any OECD country. Most developed countries have large VATs and collect a far larger share of their state revenue through regressive levies.

When all transfer payments and taxes are counted, the U.S. redistributes a larger share of its disposable income than any country other than France. Relative to the share of income they earn, the share of income taxes paid by America’s high earners is greater than the share of income taxes paid by their peers in any other OECD country. The progressive dream of an America with massive income redistribution and a highly progressive tax system has already come true. To make America even more like Europe, these dreamers will have to redefine middle-income Americans as “rich” and then double their taxes.

—Mr. Gramm, a former chairman of the Senate Banking Committee, is a visiting scholar at the American Enterprise Institute. Mr. Early served twice as assistant commissioner at the Bureau of Labor Statistics and is president of Vital Few LLC.

DougMacG

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Re: WSJ: Gramm & Early: The myth of American Inequality
« Reply #1753 on: August 13, 2018, 08:02:33 AM »
This is a very important piece IMHO. I wish everyone in politics and who votes would learn these lessons.

From the article:  "comparisons omit about $1.6 trillion in annual redistributions to low-income Americans—close to 80% of their total redistribution."

The whole theme of one party's politics is income inequality and income redistribution. The evidence the site  to back up their view omits 80% of the redistribution that we already do. They don't count transfer payments in amounts greater than the entire GDP in most countries, not a small error, then whine disingenuously that we don't do enough and need to do more.

Ronald Reagan said, "It isn't so much that liberals are ignorant. It's just that they know so many things that aren't so."

It's not just that liberal economic logic is built on half-truths. The problem is that they rely on the wrong half.


DougMacG

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Re: Why Left can't claim Scandanaiva, Denmark
« Reply #1755 on: August 13, 2018, 10:28:54 AM »


https://www.dailysignal.com/2018/08/10/democratic-socialism/?utm_source=TDS_Email&utm_medium=email&utm_campaign=Top5&mkt_tok=eyJpIjoiTlRKalpHRm1NekJoT1RNeCIsInQiOiJGMEdJVGFheUdiZkJhYldIYjc4cncyYW5teG1tdktRd0VGZmJSSlhVRGZCbkhzeWxTZHloZFEybk12UUdoQ1dJWWs4SHdnU0tuVXh1NnRXOE1jUGZHMUtvNHVHaDg0VGREWFwvN2NuZzZGWjRDTDJGS20ydDdLOCtHTkl3MkRLOHIifQ%3D%3D

Good to see this question getting well answered. Why can't we be like Sweden or Denmark?  Sweden got wealthy in a low-tax, capitalist system and Denmark has always been a free Trading, market-oriented country.  The strong safety net worked when the population had strong work ethic.

Good point made in the article, Denmark and Sweden are both listed ahead of the United States in the Heritage index list of free countries.  They are not governing by the principles of Bernie and Ocasio.

From the article, "these countries are largely homogeneous".

And we aren't.

Leftists also overlook the small point that we provide the Scandinavian defense and they would not be free, secure or prosperous without our sacrifice and expense. Conversely, they cannot and will not provide for ours.

Look at Western Europe and Scandinavia and ask what the top three issues are now. Immigration, immigration, immigration. They are losing their homogeneous society and with that they must lose their generous safety net.  Leftists everywhere will have to choose between generous safety net and open borders, they can't have both.

DougMacG

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I couldn't have said it better myself. . The so-called social democracies of Europe haven't been able to increase their growth rate in decades. What do Leftists here think caused our economy to surge, seriously. They think policies are everything in campaigns and when they govern. Then we change course and get far better results and they pretend policies don't matter or the results aren't that good. Paraphrasing Reagan, what they know is wrong. We double the growth rate of the largest economy in the history of the planet in the course of a year and a half and they think it was dumb luck, not pro-growth policies. Good grief.

Read it all and share it with your liberal economic friends.  

http://thehill.com/opinion/finance/401055-obamas-economist-grasps-at-straws-trying-to-devalue-trumps-impact
August 09, 2018
Obama's economist grasps at straws trying to devalue Trump's impact

BY LIZ PEEK, OPINION CONTRIBUTOR, THE HILL

Larry Summers is grumpy that President Trump is taking credit for the booming economy. Wait until the former mastermind of President Obama’s economic strategy sees the most recent IBD/TIPP Poll. That survey, according to Investor’s Business Daily, shows Americans giving President Trump an “A” for his handling of the economy.

The poll shows their “Economic Optimism” index climbing in August to 58, the second-highest mark since January 2004.

In addition, they note other indicators that the nation’s mood has brightened:


In August, respondents rated their “Quality of Life” at 64.2; the previous all-time high was 63.1, recorded in January 2004.The average under President Obama was 53.7.
Similarly, the latest reading on “Direction of the Country” hit 50.3, up 13 percent from the prior month, and the highest recorded since 2005. That compares to a 17-year average of 41.6 and an average of 37 during President Obama’s time in office.
The “Financial Stress Index,” which has averaged 59.4 since it was created in 2007, plunged in August to 47.4, its lowest level ever. As IBD explained, “People are feeling more secure in their finances than they have at least since the early 2000s.”
Meanwhile, the president’s approval ratings came in at 41, the highest level since March 2017. Fifty percent of respondents said they disapprove of the job Trump is doing, down 4 points from July. His “Leadership Index," similarly, saw the highest score since his first months in office.
 

Is it coincidence that these improved ratings have tracked the acceleration in the economy and improving jobs market? Of course not. A recent Rasmussen poll showed that 50 percent of likely voters say Trump deserves plaudits for the improving economy, while only 40 percent credit President Obama.


Even in a Quinnipiac poll taken at the height of the controversy over Trump’s Helsinki summit, when the president came under extreme criticism, respondents by a 49-47 margin were positive on his handling of the economy.

Larry Summers not only disagrees that President Trump has anything to do with our improving economy, he is also reluctant to bury his gloomy “secular stagnation” theory that income and job growth will forever be severely restricted.

He is, of course, in the position of having to explain why the Obama administration, in which he served as director of the National Economic Council, failed to excite higher investment and spending and instead presided over the slowest post-recession growth in modern times.

His arguments are, befitting a distinguished economist, convoluted. He wrote in a recent Financial Times op-ed that “if unemployment were at its long-term level of 5.5%, instead of its current 3.9%, Mr. Trump’s approval rate would fall lower…” Here’s the thing, Mr. Summers: It’s not at 5.5 percent.


He also says that the “acceleration of growth…is well within the normal range of growth forecast errors.” He notes that before the election the estimate for 2018 growth was 2.1 percent. “The consensus forecast of 2.8% for 2018 [does] not represent a statistically significant fluctuation from the mean.” Huh?

It’s been a while since I took statistics, but I’m pretty sure that 2.8 percent is a whale of an increase over 2.1 percent, and without a doubt a significant difference.

The only substantial critique comes from his observation that growth outside the U.S. has outperformed expectations more than here at home and that we benefited from the global increase. That was true last year when the EU, Japan and China all did better than expected; it is not true this year, an inconvenient fact he buries by lumping the two years together.

In fact, this year, the U.S. is the world’s star economy, benefiting from the GOP tax cuts and lighter regulation. That reality bolsters Trump’s claim of credit; other countries have not injected their economies with any optimism-producing tax or rule changes, and their performance has suffered in comparison.

France, under newly-elected Macron, started out attempting to loosen its archaic work rules, for instance, and the U.K. hoped to move along the same lines after Brexit, but neither country has managed to follow through.

But the ultimate argument in favor of President Trump’s impact on the economy is that Americans greeted his election with a surge of optimism the likes of which we haven’t seen in decades.

Summers would not understand that, because like most liberals, he is probably offended by Trump’s disregard for established norms of behavior and his controversial embrace of lower taxes and lighter regulation.

That optimism is real, and powerful — something Obama never appreciated. When he told business owners, “You didn’t build that,” or when he ignored and ultimately shut down the President’s Council on Jobs and Competitiveness, a group offering suggestions on how to create jobs, he displayed a very real antipathy toward private enterprise and actual job creators.

In 2010, the Washington Post reported that “the chairman of the Business Roundtable, an association of top corporate executives that has been President Obama’s closest ally in the business community, accused the president and Democratic lawmakers Tuesday of creating an 'increasingly hostile environment for investment and job creation.'”

They quoted Ivan G. Seidenberg, then CEO of Verizon Communications, blasting Democrats for pursuing higher taxes and costly regulations that “threaten to dampen economic growth and "harm our ability...to grow private-sector jobs in the U.S."

Seidenberg told the Economic Club, "By reaching into virtually every sector of economic life, government is injecting uncertainty into the marketplace and making it harder to raise capital and create new businesses."

Obama and Larry Summers never understood why their economy was stuck in the mud and what was needed to turn it around. They still don’t. President Trump, as a businessman, gets it. The results speak for themselves.

« Last Edit: August 14, 2018, 08:02:04 AM by DougMacG »

Crafty_Dog

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GPF: The Currency Crisis of 2018?
« Reply #1757 on: August 15, 2018, 01:07:19 PM »
Aug. 15, 2018
By Jacob L. Shapiro
The Currency Crisis of 2018?
GPF

It’s not too early to consider whether what’s happening in Turkey is simply a Turkish matter.


What do the Turkish lira, the Iranian rial, the Russian ruble, the Indian rupee, the Argentine peso, the Chilean peso, the Chinese yuan and the South African rand all have in common? They’ve all declined steadily this year, and some have depreciated dramatically in the past two weeks alone. But this isn’t the whole story. The whole story is that each of these countries is sitting on a ticking time bomb of U.S. dollar-denominated debt.

This story has been long in the making. In the 1990s, many countries began to accumulate large amounts of debt denominated in U.S. dollars. It was an effective way to kick-start economic activity, and so long as their own currencies remained relatively strong against the dollar, it was fairly risk free. From 1990 to 2000, dollar-denominated debt tripled from $642 billion to $2.17 trillion.

The problem may now be coming to a head. Dollar-denominated debt has ballooned. In its latest quarterly report, the Bank of International Settlements found that U.S. denominated debt to non-bank borrowers reached $11.5 trillion in March 2018 – the highest recorded total in the 55 years the bank has been tracking it. Meanwhile, the dollar has strengthened amid a tepid global recovery from the 2008 financial crisis. As the currencies of indebted countries weaken against the dollar, it is becoming harder for some countries to pay their debts. This could be a bubble waiting to pop, especially if vulnerable countries don’t have the monetary policy options to protect themselves.

Turkey Isn't Alone

Such was the case for Turkey, which is particularly susceptible to the vagaries of currency depreciation. The value of the lira had been declining for some time, but it dropped dramatically late last week. At nearly $200 billion, almost 50 percent of Turkey’s gross external debt is denominated in dollars. (Turkey’s General Directorate of Public Finance, which, unlike BIS, accounts for financial borrowers, puts that figure at nearly 60 percent.) The situation became progressively more dire through a combination of political uncertainty, unorthodox monetary policy and, most important, U.S. interest rate hikes. Turkey’s dollar-denominated debt is now almost twice as much as its total foreign reserves.

But Turkey isn’t alone. A number of emerging market currencies that were already down on the year nosedived as the news of the lira’s demise began to circulate. The starkest decline was the Argentine peso, whose value against the dollar dropped 9.5 percent in just a week, and the South African rand, which fell roughly 8 percent. Other currencies have been affected too – the Chilean peso, for example, has fallen 3.4 percent in the past week, while the Indian rupee hit a record low on the dollar during trading on Aug. 14.

What these countries have in common is that they are all on a 13-country list released by the Bank of International Settlements. Together, they constitute 62 percent of all dollar-denominated debt held by emerging market economies. Turkey was one of the most vulnerable on the list, but there are four other countries facing similar challenges: Argentina, Mexico, Chile and Indonesia. Argentina’s peso is already in free fall. The government announced on Tuesday that it would sell $500 million worth of reserves and raise interest rates to stop the peso’s fall.

Then there is Mexico, which, at $271 billion, holds more dollar-denominated debt than any other country on the list except China. This far exceeds Mexico’s official reserves. As with Turkey, dollar-denominated debt is a disproportionately large share of Mexico’s gross external debt, at roughly 60 percent. (For perspective, Mexico’s gross external debt to GDP is 39 percent, so the dollar’s influence over Mexico is particularly strong.) So far, the Mexican peso has held steady; it is slightly up on the year, and down just 0.3 percent in the past week. But if the Mexican peso begins to weaken on the back of tougher-than-expected NAFTA negotiations, political instability surrounding the new president or any other contingency, Mexico could be as bad off as Turkey is now.

The story is similar for Indonesia and Chile. Of the two, Indonesia is in slightly better shape. Its gross external debt is 35 percent of GDP, and 47 percent of that is denominated in dollars. But Indonesia doesn’t have a lot of reserves, and its currency has been showing signs of weakness, down almost 10 percent against the dollar this year. Chile’s percentage of dollar-denominated debt as a proportion to GDP is the highest of all BIS reporting countries – a whopping 36 percent. Chile’s gross external debt-to-GDP ratio is 66 percent. Most concerning, however, is that Chilean reserves totaled just $37 billion in June 2018, equal to about a third of its total dollar-denominated debt of $100 billion.


(click to enlarge)


Different Problems

Though these countries are the most vulnerable to a stronger dollar, six others – Brazil, India, South Korea, Malaysia, Russia and South Africa – face different but related problems. South Africa, for example, isn’t particularly indebted. The government insists it won’t intervene to stop the rand’s decline, but that’s only because it doesn’t have nearly enough reserves to cover what debt it has. (Its $50.6 billion in reserves could pay off just 28 percent of gross external debt.)

The five other countries are in a better position when it comes to reserves. Though they hold larger amounts of dollar-denominated debt, they have plenty of reserves. The issue for these countries is larger external debt. A strong U.S. dollar won’t cripple these economies, but it could put enough pressure on them to compel monetary intervention.

Particularly well insulated from the budding currency crisis are China and Saudi Arabia. China’s currency has been under pressure in recent weeks, but so far China has chosen not to let the yuan slide too far. China holds $548 billion in dollar-denominated debt, but that makes up just 4 percent of China’s GDP, and China’s gross external debt to GDP is 14 percent – the lowest of the countries on this list. China also has a war chest of $3.2 trillion in foreign reserves that it can deploy.

Saudi Arabia has the benefit of ample foreign reserves too – and it will certainly have to use them. The Saudi rial is pegged to the dollar. This offers stability but comes at a price: Saudi Arabia has to buy and sell reserves to maintain the peg. Though Saudi Arabia has more than enough money to play around with, it has less than it once did. Indeed, it’s been burning through its reserves in recent years – $233 billion since 2014 – to fund its adventurism abroad and its government deficit. Riyadh has no shortage of problems it needs to solve. But the currency crisis likely isn’t one of them.

This is hardly an exhaustive list. The economies surveyed by BIS make up just 37 percent of total dollar-denominated debt held worldwide, meaning there is another $7.2 trillion in such debt in the global system to account for. What started in Turkey may well spread to other countries excluded from the BIS report. Again, Turkey was uniquely susceptible to this sort of thing. The country has low savings rates and high inflation rates and all but refused to make the politically unpopular decision to raise interest rates before it was too late. We will investigate whether the other countries identified in the BIS report have similar structural problems that could aggravate their exposure to a stronger U.S. dollar.

As for Turkey, most of the polices that created its economic problems are still in place, even though investors were somewhat encouraged by the central bank’s promise to pump as much liquidity into the system as necessary. Turkey’s economy will get worse before it gets better. The more important question now is whether that will spread to other vulnerable countries. The most worrying at this point are Argentina, Mexico, Indonesia and Chile. It’s too early to call a full-blown global financial crisis, but it’s not too early to begin to consider whether what’s happening in Turkey is simply a Turkish matter.


DougMacG

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Political Economics, Does government intervention stabilize free markets?
« Reply #1758 on: August 27, 2018, 07:35:18 AM »
Our government-centric public debate is built on a false premise.

https://www.researchgate.net/publication/320044225_Can_Government_Stabilize_the_Economy#share

Claims that free-market capitalism is inherently unstable (relative socialist or fascist centralized control) led to a vast expansion of government and central banking under the promise that economic experts could put an end to booms and busts. The record says otherwise.

Crafty_Dog

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Re: Political Economics
« Reply #1759 on: September 11, 2018, 07:00:45 AM »
Looking for a Scott Grannis piece on how the eight years of Obama underperformed , , ,

DougMacG

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Re: Political Economics
« Reply #1760 on: September 12, 2018, 05:13:35 AM »
Looking for a Scott Grannis piece on how the eight years of Obama underperformed , , ,

This comes from a post called key charts updated.



I will keep looking.

DougMacG

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Re: Political Economics
« Reply #1761 on: September 12, 2018, 08:32:02 AM »
Kevin Hassett, chairman of the Council of economic advisers, refutes the idea that the current upward trends are merely a continuation of the trends before Trump was elected. Take a look at these important charts. Short video, well worth your while.
https://youtu.be/LL-XB7rw4OM

G M

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Re: Political Economics
« Reply #1762 on: September 12, 2018, 09:34:12 AM »
Kevin Hassett, chairman of the Council of economic advisers, refutes the idea that the current upward trends are merely a continuation of the trends before Trump was elected. Take a look at these important charts. Short video, well worth your while.
https://youtu.be/LL-XB7rw4OM

Someone better save this video before the Goolag sends it down the memory hole.

DougMacG

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Political Economics, Sweden's economy past and present, lessons for America
« Reply #1763 on: September 19, 2018, 07:26:00 AM »
https://www.atlasnetwork.org/news/article/the-story-of-sweden-is-about-markets-not-socialism

The story of Sweden is about markets, not socialism.

[Norberg's film]...takes viewers on a journey through Sweden’s economic past and present; learning how freedom of the press, a free market, innovation, and reduced taxation helped repair the nation one step at a time.

“Interestingly, many social democrats in the U.S. use Sweden as a kind of cover for their own statist policies,” said Norberg, who also served as executive editor for the program. “I don't think the American Left knows that Sweden is the country of pension reform, school vouchers, free trade, low corporate taxes and no taxes on property, gifts and inheritance. Sweden affords its big welfare state because it is more free-market and free trade than other countries. So if they want to redistribute wealth they also have to deregulate the economy drastically to create that wealth.”
...
“Sweden is not an exception to general economic laws,” said Norberg. “It's not the place where we showed that prosperity and big government go hand in hand. Sweden got rich when taxes and public spending was lower than in other places, including the U.S. Only then, in the 1970s did we start to tax and spend heavily. And that is when we began to lag behind. Only after reforms since the 1990s did we get back on track. So, one message is: don't get cocky, don't think you can do anything and break economic laws just because you're on top of the world for the moment."

DougMacG

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Political Economics, Hispanic Americans doing particularly well under Trump
« Reply #1764 on: September 20, 2018, 07:11:08 AM »
Hispanic incomes up, unemployment down. Hispanics as a group are more entrepreneurial than other so-called demographic groups.

https://thehill.com/opinion/finance/407079-hispanics-flourishing-in-trump-economy
Hispanic unemployment rate remained at a record low — below 5 percent for the fifth consecutive month. This is less than half the unemployment rate that Hispanics faced as recently as President Obama’s second term. Median weekly earnings for full-time Hispanic employees have grown by 4.3 percent, adjusted for inflation, over the past two years.
-----
It makes me wonder if economic growth based policies are not racist and do not favor the rich over others.
« Last Edit: January 13, 2019, 08:07:10 PM by DougMacG »

DougMacG

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Political Economics, World Bank:Smaller government is more effective
« Reply #1765 on: October 07, 2018, 10:06:17 AM »
I post this here just in case it wasn't the lead story in your local newspaper or the on the evening news.

World Bank study and plenty of other studies conclude smaller government is both more efficient and more effective:
(Read it all and all of the links.)  ))

https://danieljmitchell.wordpress.com/2018/10/06/more-evidence-that-small-government-works-better/amp/?_27th_twitter_impression=true

https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3249289

The World Bank conclusion is backed up by plenty of other studies including those by the European Central Bank:

https://danieljmitchell.wordpress.com/2014/11/10/research-shows-that-small-government-is-efficient-government/

https://www.ecb.europa.eu/pub/pdf/scpwps/ecbwp242.pdf

https://danieljmitchell.wordpress.com/2014/11/27/singapore-a-remarkable-free-market-success-story/

The IMF’s new working paper on “Fiscal Decentralization and the Efficiency of Public Service Delivery” shows that it’s not only good to have small government, but that it’s also good to have decentralized government. Here are the main findings.

This paper analyzes the impacts of fiscal decentralization on the efficiency of public service delivery. …The paper’s findings suggest that fiscal decentralization can serve as a policy tool to improve performance…http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2594142

DougMacG

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Political Economics, Poverty in the U.S. Was Plummeting - Before War on Poverty
« Reply #1766 on: October 23, 2018, 06:14:47 AM »
Please read it all.  Successfully addressing this one problem would solve so many others.
https://fee.org/articles/poverty-in-the-us-was-plummeting-until-lyndon-johnson-declared-war-on-it/

Poverty in the U.S. Was Plummeting—Until Lyndon Johnson Declared War On It
Yet again, government intervention hurts those it is intended to help.
Tuesday, October 16, 2018

Daniel J. Mitchell
Economics Economic Education Welfare State Marginal Tax Rate
One of the more elementary observations about economics is that a nation’s prosperity is determined in part by the quantity and quality of labor and capital. These “factors of production” are combined to generate national income.

I frequently grouse that punitive tax policies discourage capital. There’s less incentive to invest, after all, if the government imposes extra layers of tax on income that is saved and invested.

Bad tax laws also discourage labor. High marginal tax rates penalize people for being productive, and this can be especially counterproductive for entrepreneurship and innovation.

Still, we shouldn’t overlook how government discourages low-income people from being productively employed. But the problem is more on the spending side of the fiscal equation.

The Welfare State's Effect on the Poor
In Thursday's Wall Street Journal, John Early and Phil Gramm share some depressing numbers about growing dependency in the United States:

During the 20 years before the War on Poverty was funded, the portion of the nation living in poverty had dropped to 14.7% from 32.1%. Since 1966, the first year with a significant increase in antipoverty spending, the poverty rate reported by the Census Bureau has been virtually unchanged…Transfers targeted to low-income families increased in real dollars from an average of $3,070 per person in 1965 to $34,093 in 2016…Transfers now constitute 84.2% of the disposable income of the poorest quintile of American households and 57.8% of the disposable income of lower-middle-income households. These payments also make up 27.5% of America’s total disposable income.

This massive expansion of redistribution has negatively impacted incentives to work:

The stated goal of the War on Poverty is not just to raise living standards but also to make America’s poor more self-sufficient and to bring them into the mainstream of the economy. In that effort the war has been an abject failure, increasing dependency and largely severing the bottom fifth of earners from the rewards and responsibilities of work…The expanding availability of antipoverty transfers has devastated the work effort of poor and lower-middle income families. By 1975 the lowest-earning fifth of families had 24.8% more families with a prime-work age head and no one working than did their middle-income peers. By 2015 this differential had risen to 37.1%…The War on Poverty has increased dependency and failed in its primary effort to bring poor people into the mainstream of America’s economy and communal life. Government programs replaced deprivation with idleness, stifling human flourishing. It happened just as President Franklin Roosevelt said it would: “The lessons of history,” he said in 1935, “show conclusively that continued dependency upon relief induces a spiritual and moral disintegration fundamentally destructive to the national fiber.”

In another WSJ column on the same topic, Peter Cove reached a similar conclusion:

America doesn’t have a worker shortage; it has a work shortage. The unemployment rate is at a 15-year low, but only 55% of Americans adults 18 to 64 have full-time jobs. Nearly 95 million people have removed themselves entirely from the job market. According to demographer Nicholas Eberstadt, the labor-force participation rate for men 25 to 54 is lower now than it was at the end of the Great Depression. The welfare state is largely to blame… insisting on work in exchange for social benefits would succeed in reducing dependency. We have the data: Within 10 years of the 1996 reform, the number of Americans in the Temporary Assistance for Needy Families program fell 60%. But no reform is permanent. Under President Obama, federal poverty programs ballooned.

Edward Glaeser produced a similar indictment in an article for City Journal:

In 1967, 95 percent of “prime-age” men between the ages of 25 and 54 worked. During the Great Recession, though, the share of jobless prime-age males rose above 20 percent. Even today, long after the recession officially ended, more than 15 percent of such men aren’t working… The rise of joblessness—especially among men—is the great American domestic crisis of the twenty-first century. It is a crisis of spirit more than of resources… Proposed solutions that focus solely on providing material benefits are a false path. Well-meaning social policies—from longer unemployment insurance to more generous disability diagnoses to higher minimum wages—have only worsened the problem; the futility of joblessness won’t be solved with a welfare check… various programs make joblessness more bearable, at least materially; they also reduce the incentives to find work… The past decade or so has seen a resurgent progressive focus on inequality—and little concern among progressives about the downsides of discouraging work… The decision to prioritize equality over employment is particularly puzzling, given that social scientists have repeatedly found that unemployment is the greater evil.

Encouraging Dependency
Why work, though, when the government pays you not to work?

And that unfortunate cost-benefit analysis is being driven by ever-greater levels of dependency.

Writing for Forbes, Professor Jeffrey Dorfman echoed these findings:

…our current welfare system fails to prepare people to take care of themselves, makes poor people more financially fragile, and creates incentives to remain on welfare forever… The first failure of government welfare programs is to favor help with current consumption while placing almost no emphasis on job training or anything else that might allow today’s poor people to become self-sufficient in the future… It is the classic story of giving a man a fish or teaching him how to fish. Government welfare programs hand out lots of fish but never seem to teach people how to fish for themselves. The problem is not a lack of job training programs, but rather the fact that the job training programs fail to help people… The third flaw in the government welfare system is the way that benefits phase out as a recipient’s income increases… a poor family trying to escape poverty pays an effective marginal tax rate that is considerably higher than a middle class family and higher than or roughly equal to the marginal tax rate of a family in the top one percent.

I like that he also addressed problems such as implicit marginal tax rates and the failure of job-training programs.

Professor Lee Ohanian of the Hoover Institution reinforces the point that the welfare state provides lots of money in ways that stifle personal initiative:

Inequality is not an issue that policy should address… Society, however, should care about creating economic opportunities for the lowest earners… a family of four at the poverty level has about $22,300 per year of pre-tax income. Consumption for that same family of four on average, however, is about $44,000 per year, which means that their consumption level is about twice as high as their income… We’re certainly providing many more resources to low-earning families today. But on the other hand, we have policies in place that either limit economic opportunities for low earners or distort the incentives for those earners to achieve prosperity.

I’ve been citing lots of articles, which might be tedious, so let’s take a break with a video about the welfare state from the American Enterprise Institute.



And if you like videos, here’s my favorite video about the adverse effects of the welfare state.

Even (Some) Leftists Acknowledge the Problem
By the way, it isn’t just libertarians and conservatives who recognize the problem.

Coming from a left-of-center perspective, Catherine Rampell explains in the Washington Post how welfare programs discourage work:

…today’s social safety net discourages poor people from working, or at least from earning more money… you might qualify for some welfare programs, such as food stamps, housing vouchers, child-care subsidies and Medicaid. But if you get a promotion, or longer hours, or a second job, or otherwise start making more, these benefits will start to evaporate—and sometimes quite abruptly. You can think about this loss of benefits as a kind of extra tax on low-income people… Americans at or just above the poverty line typically face marginal tax rates of 34 percent. That is, for every additional dollar they earn, they keep only 66 cents… One in 10 families with earnings close to the poverty line faces a marginal tax rate of at least 65 percent, the CBO found… You don’t need to be a hardcore conservative to see how this system might make working longer hours, or getting a better job, less attractive than it might otherwise be.

To understand what this means, the Illinois Policy Institute calculated how poor people in the state are trapped in dependency:

The potential sum of welfare benefits can reach $47,894 annually for single-parent households and $41,237 for two-parent households. Welfare benefits will be available to some households earning as much as $74,880 annually… A single mom has the most resources available to her family when she works full time at a wage of $8.25 to $12 an hour. Disturbingly, taking a pay increase to $18 an hour can leave her with about one-third fewer total resources (net income and government benefits). In order to make work “pay” again, she would need an hourly wage of $38 to mitigate the impact of lost benefits and higher taxes.

Agreeing that there’s a problem does not imply agreement about a solution.

Folks on the left think the solution to high implicit tax rates (i.e., the dependency trap) is to make benefits more widely available. In other words, don’t reduce handouts as income increases.

The other alternative is to make benefits less generous, which will simultaneously reduce implicit tax rates and encourage more work.

I’m sympathetic to the latter approach, but my view is that welfare programs should be designed and financed by state and local governments. We’re far more likely to see innovation as policymakers in different areas experiment with the best ways of preventing serious deprivation while also encouraging self-sufficiency.

I think we’ll find out that benefits should be lower, but maybe we’ll learn in certain cases that benefits should be expanded. But we won’t learn anything so long as there is a one-size-fits-all approach from Washington.

Let’s close with a political observation. A columnist for the New York Times is frustrated that many low-income voters are supporting Republicans because they see how their neighbors are being harmed by dependency:

Parts of the country that depend on the safety-net programs supported by Democrats are increasingly voting for Republicans who favor shredding that net… The people in these communities who are voting Republican in larger proportions are those who are a notch or two up the economic ladder—the sheriff’s deputy, the teacher, the highway worker, the motel clerk, the gas station owner and the coal miner. And their growing allegiance to the Republicans is, in part, a reaction against what they perceive, among those below them on the economic ladder, as a growing dependency on the safety net, the most visible manifestation of downward mobility in their declining towns… I’ve heard variations on this theme all over the country: people railing against the guy across the street who is collecting disability payments but is well enough to go fishing, the families using their food assistance to indulge in steaks.

It’s not my role to pontificate about politics, so I won’t address that part of the column. But I will say that I’ve also found that hostility to welfare is strongest among those who have first-hand knowledge of how dependency hurts people.

P.S. If you want evidence for why Washington should get out of the business of income redistribution, check out this visual depiction of the welfare state:
https://i0.wp.com/waysandmeans.house.gov/wp-content/uploads/2015/11/WM-Welfare-Chart-AR-amendment-110215-jpeg.jpg

P.P.S. The Nordic nations also provide valuable lessons, at least from the don’t-do-this perspective.
https://danieljmitchell.wordpress.com/2016/08/27/nordic-nations-show-how-welfare-and-redistribution-weaken-the-human-spirit/

P.P.P.S. Last but not least, there’s a Laffer-type relationship between welfare spending and poverty.
https://danieljmitchell.wordpress.com/2016/03/20/a-laffer-curve-relationship-between-welfare-spending-and-poverty/

DougMacG

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Political Economics, Good God, Even Slate admits (Trump) Wage Growth
« Reply #1767 on: November 01, 2018, 08:40:42 AM »
The Economy Is Doing That Cool Thing Where Wages Rise
By JORDAN WEISSMANN
OCT 31, 2018
------------------------------

It seems to me the old reason to be a Democrat was a belief in union jobs, factory jobs, manufacturing jobs, tradesman jobs and having a party that advocates for the working 'man'.

Man has that flipped.  Manufacturing job growth up TEN-FOLD under Trump and Michigan, Ohio, Pennsylvania all went for Trump before he did that.

Article notes a undeniable correlation between tight labor market and wage growth, ignoring the entire point of what causes employment (and income) growth.

I will spill the answer where no Slate reader can see it:  Capital employs labor.

The war on capital is over (for the moment with an update next week).  Excessive and punitive levels of regulations and taxes designed to hurt the rich and slow down the creation of wealth had the entirely predictable result of punishing workers instead.  The rich already have wealth - by definition.  And workers need employment by definition - until they leave the workforce as they did in record numbers under the previous administration.


ccp

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Re: Political Economics
« Reply #1768 on: November 01, 2018, 09:20:35 AM »
Doug you are right
but as long as we are up against the Dem propaganda machine it doesn't much matter.

some Repubs had finally woken up but still some that just have to hate Trump like some of these Bushecrats just have no sense that we are fighting keep from being a one party country
or even a viable sovereign state.

All of them seem to be well to do , and connected in the beltway .  They seem fine selling us down the river.




DougMacG

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Re: Political Economics
« Reply #1769 on: November 01, 2018, 09:36:14 AM »
Doug you are right
but as long as we are up against the Dem propaganda machine it doesn't much matter.

some Repubs had finally woken up but still some that just have to hate Trump like some of these Bushecrats just have no sense that we are fighting keep from being a one party country
or even a viable sovereign state.

All of them seem to be well to do , and connected in the beltway .  They seem fine selling us down the river.

More than doublling the growth rate of the largest economy in the history of the planet in just two years and no one mentions it!  Wages finally start up.  The rate of new manufacturing jobs growth up tenfold.  My embattled congressman in one of those suburban districts that will determine our future, a Republican held district since the 1960 election, he is Chair of the Joint Economic Committee, sent us a mailer yesterday touting his support for gun control.  "A different kind of Republican"  What a waste to compete at their game instead of winning hearts and minds over to our side.

DougMacG

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Re: Political Economics
« Reply #1770 on: November 13, 2018, 10:06:40 AM »
"More than doublling the growth rate of the largest economy in the history of the planet in just two years and no one mentions it!  Wages finally start up.  The rate of new manufacturing jobs growth up tenfold."

We were right and it didn't matter.

Imagine if the deregulation and tax rate cuts had not grown the economy. Republicans would have been fully discredited and defeated. Now look at what happened. Trump and the Republicans doubled the growth rate of the largest economy in the world. The policies worked. The difference that it makes is enormous and reaches into all other issues, problems and challenges. Black and Hispanic and other unemployment rates dropping helps the inner city. The growth rate helps us to compete with China and to stop their unfair tariffs and technology theft. The prosperous economy helps us to deal with environmental issues and affordability of healthcare and housing and so on. But people indoctrinated in the opposition  to these policies believe results have nothing to do with policies, that results are just dumb luck  or they take the renewed prosperity for granted.  You can't make the voter agree with you about what is important.

Or is it that no one made the case?

ccp

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CNN is is obama's economy
« Reply #1771 on: November 13, 2018, 10:49:17 AM »
Doug writes,

" rosperous economy helps us to deal with environmental issues and affordability of healthcare and housing and so on. But people indoctrinated in the opposition  to these policies believe results have nothing to do with policies, that results are just dumb luck  or they take the renewed prosperity for granted. "

or as in the words of the great objective newscaster dom lemon,  Trump inherited a great recovering economy from Obama and it is Obama who deserves the credit , and "everyone knows this".

or another ruse, this doesn't really help the average "folks" .  (I don't know who they mean by "folks exactly" -   But I know these insiders  ain't the "folks")





ccp

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Bezos chooses the two corridors of POWER
« Reply #1772 on: November 13, 2018, 10:53:42 AM »
DC burb and NYC for his two sites.   
Flood the areas with his disciples so he can control things better from there.
This guys business ruthlessness is beginning to tread on me  and I don't like all the red flags I am seeing the least of which is him being the Wash comPost:

https://www.nationalreview.com/corner/amazon-hq2-crystal-city-virginia/

DougMacG

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CATO AT LIBERTY

DECEMBER 10, 2018
The 1990 Bush “Tax Increase” Reduced Taxes
By ALAN REYNOLDS

https://www.cato.org/blog/1990-bush-tax-increase-reduced-taxes

DougMacG

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Political Economics, Krugman v. Wanniski, inequality?
« Reply #1774 on: December 27, 2018, 05:46:38 PM »
Free market economics vs Krugman was mentioned in energy thread in the context the the 'Green New Deal'.  Adding this here:

PART ONE: WANNISKI

>Memo To: Mother Jones Backtalk
> From: Jude Wanniski
> Re: Krugman on the Spiral of Inequality >

>You ask me for my opinion on your Twentieth Anniversary issue, dated
>December 1996, specifically the article on P. 44 by Paul Krugman. Generally
>speaking, Krugman has had nothing much to say about political economy for
>the last several years other than the rich are getting richer faster than
>the poor are getting richer. He has written this story hundreds of times, in
>newspapers, magazines, and books. Unsuspecting editors continue to pay him
>for plagiarizing his own material. Because he appears in such illustrious
>publications as The New York Times Magazine and Foreign Affairs, the editors
>of Mother Jones and no doubt the Ladies Home Journal are thrilled to see his
>manuscripts flow over the transom, with yet another exciting expose about
>how the rich are getting richer faster than the poor are getting richer.

>This is a chain letter he writes to himself, his very own pyramid club, the
>most elaborate Ponzi scheme in American journalism.

> >If you would take the trouble to read the stuff you shoveled into type, you
>would find that he said absolutely nothing about economics until the second
>page of his tract, when he asserted: "What few people realize is that this
>vast gap between the affluent few and the bulk of ordinary Americans is a
>relatively new fixture on our social landscape." This is utter nonsense. A
>century ago, John D. Rockefeller had income the equivalent today of $500
>million, year after year, for a quarter century. Andrew Carnegie did almost
>as well. A handful of Americans possessed a far larger fraction of the
>national wealth than any collection of wealthy Americans possess today.

> >Krugman's childish attempts at economic analysis are able to fool Mother
>Jones editors only because you have nobody on the staff who is competent to
>assess his scribbles. Do any of you know the difference between income and
>wealth? Krugman dances from one concept to the next, and it all sounds so
>plausible, because he has made a name for himself with other editors, none
>of whom are any better fixed than you to realize that he is a charlatan.

>Here are a few simple concepts I put to you, in challenging his idea that
>the rich are getting richer faster than the poor are getting richer. I
>maintain that the central problem of the last 30 years is that the poor are
>getting richer much, much faster than the rich are getting richer.

> >1. First let us get our accounting unit squared away. To measure anything in
>the floating paper dollar will get us nowhere. We must convert all wealth
>into the measure employed by mankind for six thousand years, i.e., ounces of
>gold. On this measure, the Dow Jones Industrial Average of 6000 today is
>only 60% of the DJIA of 30 years ago, when the DJIA hit 1000. Back then,
>gold was $35 per ounce. Today it is $380-plus. This is another way of saying
>that in the last 30 years, the people who owned America have lost 40% of
>their wealth held in the form of equity. Do you understand what I am saying,
>Mother Jones? If you owned no part of corporate America 30 years ago,
>because you were poor, you lost nothing. If you owned lots of it, you lost
>your shirt in the general inflation.

> >2. This is true of the vast majority of shareholders in Main Street America.
>Not those who own a piece of the $6 trillion in the stock market -- less
>than $600 million when converted into gold at 1966 prices. I'm speaking of
>the small businessmen whose shares are not publicly traded. These poor slobs
>have been decimated by a combination of the (1) inflation and (2) federal
>tax codes. According to the best estimates any of us have, these poor slobs
>face a federal tax liability of $2 trillion on the $7 trillion of inflated
>capital gains which have accumulated in our economy, beginning in 1966 when
>President Lyndon Johnson closed our participation in the London gold pool.
>(By that, I mean he no longer promised to pay America's creditors in paper
>dollars with a fixed value in commodities, gold being the proxy.)

> >3. If you were to ask Professor Krugman to put down his coloring book for a
>moment, and put a real number on the wealth of the affluent, please do me a
>favor. Ask him if his number is net of the $2 trillion [$2,000,000,000,000]
>in federal tax liabilities these affluent people face, because Professor
>Krugman's pals refuse to index capital gains retroactively. Please do not
>dismiss this question lightly, Mother Jones. Think about it a moment or two.
>If Krugman cannot answer you to your satisfaction, promise him that his name
>will never again appear in your publication, unless he apologizes for being
>a sophomore.

> >4. Now we get to entitlements. If you own a $100,000 bond that pays 7% a
>year, you will have an annual income of $7000 for the life of the bond. If
>you are entitled to a government check to cover your Medicare bill of
>$35,000 a year, for the rest of your life, you have wealth that is the
>equivalent of $500,000. Because you are only scribes, you are not expected
>to know this stuff, Mother Jones editors. I was once in your boat, a
>reporter who never took a Ph.D. in economics from MIT or Harvard. It took me
>a long while to learn what I am conveying to you in this response to your
>letter. In this example alone, we find that the poor hold guaranteed
>entitlements on $7 trillion of unfunded tax liabilities, for their old age
>and health benefits, which can only be paid for by the rich, who are the
>nation's producers. At the same time, the rich face a 28% tax liability on
>another $7 trillion in inflated capital gains. Add up the portfolios of the
>rich and the poor, 30 years later, and you will find the poor have become
>fat and happy, the rich impoverished. This is why we are in the fix we are
>in. Everyone wants to be poor, because it has so many more advantages!
> >5. These are enormous numbers. You will not find any of them in Krugman's
>Ponzi schemes. He has either not thought about them, in which case I might
>believe he is dumb but honest. Or, he has thought about them, and is
>therefore half-smart and dishonest. I personally believe Krugman is honest,
>but dumb enough to believe in the assumptions he was taught in school to
>believe he really does know the way the world works, when he knows almost
>nothing at all.

> >6. The basic problem the liberal media have with people like Krugman is that
>they are careful to never make economic predictions, so they can never be
>brought to heel. Nobody actually pays Krugman for his economic counsel, or
>they would soon be bankrupt. Like you, they pay him for his political
>blatherings, about the rich getting richer faster than the poor are getting
>rich. In this case, I truly appreciate your insistence that I take time out
>of my life to comment on his jabberings.

> >7.There is only one time where our paths crossed in person. A few months
>back, we were on the same PBS radio program out of Boston, talking about
>taxes and the economy. I append the transcript, which I took the trouble of
>transcribing. Note that Krugman defends himself exclusively by ad hominem
>attacks on supply-side economics -- the only flavor of economics that has
>had predictive power over the last 25 years. If Krugman had to predict to
>make a living, he would starve to death. >
« Last Edit: December 27, 2018, 06:21:58 PM by Crafty_Dog »

Crafty_Dog

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Re: Political Economics
« Reply #1775 on: December 27, 2018, 06:24:59 PM »
Wonderful find and exemplary use of this forum!

DougMacG

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Political Economics, Krugman sides with Ocasio Cortez
« Reply #1776 on: January 07, 2019, 10:20:50 AM »
https://www.nytimes.com/2019/01/05/opinion/alexandria-ocasio-cortez-tax-policy-dance.html

He did not win a Nobel prize with this level of reasoning.  I will try to follow up on this, time permitting.

[We did fine with tax rates of 70-80%] "for 35 years after World War II — including the most successful period of economic growth in our history."

   - Would he like us to compete again in the 1950s world in 2019?  How?

"Give a family with an annual income of $20,000 an extra $1,000 and it will make a big difference to their lives. Give a guy who makes $1 million an extra thousand and he’ll barely notice it."

   - Put it differently.  Take away a thousand dollars from a $20k family and they can't do a damn thing about it.  Change the tax rate of a million dollar family and they change their investment math instantly.  More funds to employ people go off-shore - like when 4600 American companies moved operation overseas prior to corporate [double] tax reform.

Capital employs labor and people like 'AOC' ,Krugman and the late Hugo Chavez pretend to care about labor as they take or chase away the capital that employs it. 

Krugman:  "when taxing the rich, all we should care about is how much revenue we raise."

   - One data point Krugman can't find is 2018 versus all of Obama's two terms where excess regulation was eased and tax rates reformed.  The growth rate of the nation doubled, employment and wages surged, food stamp need plummeted and revenues to the Treasury grew.

This isn't a difference of political opinion; it's intellectual dishonesty.  Of course the young and cute little Alexandria agrees with him.  His is the economics they teach in college.

Krugman:  "So why not tax them at 100 percent? The answer is that this would eliminate any incentive to do whatever it is they do to earn that much money, which would hurt the economy."

   - Q.E.D.  (That which was to be demonstrated.)

DougMacG

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Political Economics - Minimum Wage $15? $33? Why not $100
« Reply #1777 on: January 22, 2019, 11:29:04 AM »
https://www.nytimes.com/2019/01/04/nyregion/the-15-dollar-minimum-wage-is-not-enough.html?login=smartlock&auth=login-smartlock
--------------------------------------
With $15 all but achieved, next they demand $33.  Why not $100?  Or a million if it is that easy to legislate prosperity.

The question is not what should wages be, but WHO SHOULD DECIDE?  Employers and employees negotiating their best interests consensually in a free market - or your all-knowing, all caring government?

Minimum Wage Laws Are Barriers to Employment [and they hurt the most vulnerable people and groups worst].
https://www.mercatus.org/expert_commentary/minimum-wage-laws-are-barriers-employment

OTOH, minimum wage increases are great for the robotics industry.
« Last Edit: January 23, 2019, 06:01:42 AM by DougMacG »

DougMacG

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[Formerly] "Socialist" Scandinavian Countries Skyrocket Up Lassiez-Faire Index
« Reply #1778 on: January 23, 2019, 06:17:53 AM »
https://mises.org/power-market/socialist-scandinavian-countries-skyrocket-lassiez-faire-index
by Dan Mitchell

Which nations rely most on unfettered markets?



Above ranked by non-fiscal economic freedom.

« Last Edit: January 23, 2019, 06:20:31 AM by DougMacG »

ccp

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Jeff Bezos net worth vs state budgets
« Reply #1779 on: February 28, 2019, 08:58:45 AM »
His net worth is more than the budgets of every state except California and NY:

https://en.wikipedia.org/wiki/List_of_U.S._state_budgets

Crafty_Dog

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Re: Political Economics
« Reply #1780 on: February 28, 2019, 10:34:03 AM »
 :-o :-o :-o

DougMacG

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Re: Jeff Bezos net worth vs state annual budgets
« Reply #1781 on: March 03, 2019, 09:10:47 AM »
His net worth is more than the budgets of every state except California and NY:

https://en.wikipedia.org/wiki/List_of_U.S._state_budgets

Another comparison of his wealth:
USA net worth  $90 trillion
Richest man:  0.136 trillion, Richest man's wealth rounds to zero.

And he is about to lose half of it.

USA net income:  $20 trillion
Amazon net income:  $0.011 trillion
In this rough math, the richest company is hogging a .00055 share of the country's income.

Concentration of wealth is our greatest problem?  He will collect zero future income in the Left's zero sum theory that he will eventually have all our money and no one to ship to.

Like Gates and Microsoft, Bezos got rich by making the rest of us more efficient, i.e. richer.  Subtract growth projection from his customers' buying and his stock value wealth shrinks by 80%. 

ccp

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total state debts
« Reply #1782 on: March 05, 2019, 10:29:20 AM »
over one trillion:

https://ballotpedia.org/State_debt

So Bezos and the super wealthy crew could not pay it off.

Darn!  I was hoping we could form a mob string them all up and steal their money and pay it all off  (AOC approves the concept)

Then again as Doug points out most of the wealth is paper wealth.

Crafty_Dog

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Peter Zeihan
« Reply #1783 on: March 15, 2019, 07:48:14 AM »

DougMacG

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Political Economics - Alan Krueger
« Reply #1784 on: March 19, 2019, 10:29:42 AM »
I'm not counting how many Clinton advisers and 'business associates' have died of other than natural causes.  Google: Clinton Associates Who Died Mysteriously or see Snopes declaring those 46 (47 now?) false. Add this one to any list, former economic adviser for Clinton and Obama, Alan Krueger took his own life over the weekend.

I'm sure we will never know what was on his mind when he gave up, other than perhaps tragic, untreated depression?  My condolences to family, friends colleagues.

Unlike Vincent Foster, I doubt he carried personal baggage for the Clintons (or Obamas).  He did carry professional baggage however.  It takes major intellectual contortions to be an economic adviser to the Left.

Like Paul Krugman, Krueger was a Professor of Economics at Princeton, a lofty professional height if you ignore all the disinformation and politicization. 

He was known for his bold work pretending to refute for the Left the first law of Econ 101, supply and demand:

"Krueger compared restaurant jobs in New Jersey, which raised its minimum wage, to restaurant jobs in Pennsylvania, which did not, and found that restaurant employment in New Jersey increased, while it decreased in Pennsylvania."
https://www.nytimes.com/1993/08/22/weekinreview/conversations-david-card-alan-krueger-two-economists-catch-clinton-s-eye-bucking.html?mtrref=en.wikipedia.org&gwh=E76AB3E1AA6187EDAF9C36F9C38CC82C&gwt=pay

Raising the cost of employment does not reduce the amount of employment demanded?  Against everything we know?  An amazing breakthrough for the Left.
 This is valid because of his high credentials?  He conducted a 'scientific', 'peer reviewed' study of apples and oranges to demonstrate exactly what the Left needed to hear, and his career soared. 

The reelection of President Obama and a major tax increase, the expiration of the Bush tax rate cuts, happened during Krueger's work as chief economic adviser.  Add in his silent accomplishment of covering up failure with his friend Janet Yellen leaving interest rates at zero and quantitative easement in place through all of Obama's second term, against all economic wisdom unless one admits the economy was on the tip of disaster the entire eight years.  The Yellen Fed policy was to let the consequences of that fall on the successor.

In 2018 he wrote an opinion in favor of Harvard's admission discrimination policy.
https://admissionscase.harvard.edu/files/adm-case/files/economists_amended_brief_dkt._527-1.pdf
One co-author:  Janet Yellen.  Small world.
« Last Edit: March 19, 2019, 06:12:54 PM by DougMacG »

DougMacG

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Political Economics, Jobless claims lowest in 50 years. WHY?
« Reply #1785 on: April 12, 2019, 11:31:31 AM »
Jobless claims lowest in 50 years
https://www.pressherald.com/2019/04/11/jobless-claims-sink-to-50-year-low/

Small Business Job Creation Breaks 45-year Record
https://www.nfib.com/content/press-release/economy/small-business-job-creation-breaks-45-year-record/
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Why?  It works like this.  If the economy tanks under Republicans it is Republicans fault.  If the economy surges under Republicans it is a random event unrelated to policies.
« Last Edit: April 12, 2019, 12:33:58 PM by DougMacG »

DougMacG

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Earliest known writing against income equality, redistribution politics
« Reply #1786 on: April 15, 2019, 08:18:20 AM »
You shall not covet your neighbor's house. You shall not covet your neighbor's wife, or his male or female servant, his ox or donkey, or anything that belongs to your neighbor.
— Exodus 20:17

"You shall not covet" means that we should banish our desires for whatever does not belong to us.
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Maybe this belongs under wisdom from the Founders.   
« Last Edit: April 15, 2019, 08:19:53 AM by DougMacG »

DougMacG

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Re: Political Economics, two choices to address inequality
« Reply #1787 on: May 04, 2019, 06:21:19 AM »
Mike Pence: 
We want to make the poor richer.
They want to make the rich poorer.

DougMacG

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Where are they now?
« Reply #1788 on: May 04, 2019, 06:23:31 AM »
https://nypost.com/2019/05/03/experts-predicted-economic-armageddon-under-trump-where-are-they-now/

Experts predicted economic Armageddon under Trump — where are they now?
By Charles Gasparino May 3, 2019

The economy is strong, unemployment is low and wages are rising, according to the latest economic data released Friday, which is in stark contrast to what the vast majority of elite economic opinion predicted just a few years ago from a Trump presidency.

The latest unemployment report has joblessness at 3.6 percent. Where is the Trump Armageddon Squad now?

What’s even more egregious is that the same folks predicting the end of the world refuse to provide sane analysis of radical proposals dribbling out of the mouths of the Democrats. They report on Medicare-for-All, the Green New Deal and college debt forgiveness as if these cockamamie ideas will have no impact on the economy.

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https://www.politico.com/story/2016/10/donald-trump-wall-street-effect-markets-230164

Economists: A Trump win would tank the markets
If GOP nominee pulls off a Brexit-like surprise, Wall Street would face a Brexit-like stock plunge.

By BEN WHITE 10/21/2016 02:46 PM EDT
NEW YORK — Wall Street is set up for a major crash if Donald Trump shocks the world on Election Day and wins the White House.

New research out on Friday suggests that financial markets strongly prefer a Hillary Clinton presidency and could react with panicked selling should Trump defy the polls and deliver a shocking upset on Nov. 8.
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When do they print the correction?
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https://www.washingtonexaminer.com/opinion/trumps-economy-proves-democrats-are-presently-on-another-planet
« Last Edit: May 04, 2019, 07:53:30 AM by Crafty_Dog »

ccp

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Re: Political Economics
« Reply #1789 on: May 04, 2019, 10:17:34 AM »
"  Economists: A Trump win would tank the markets"

How did we know more then these economists

We here sure as heck know  a  Sanders win WILL tank markets.

Mayor Butt will do the same for the US economy as he did for South Bend.

How about mayor Mike?  (Mike Blasee .)
I am sure he is taking any credit for NewYorkers benefiting from the Trump economy.

ccp

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hard to believe Schiester Schumer is sincere
« Reply #1790 on: May 14, 2019, 03:18:33 PM »
anyone beside me who is not a just a little cynical

that Schumer agrees with Trump and tariffs against China?

come on when has Schumer agreed to go along with Trump for anything

(maybe to harm the economy and farmers in time for the election   :wink:) .


DougMacG

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Political Economics, Poorest Americans are richer than the average Europeans
« Reply #1792 on: August 26, 2019, 11:54:49 AM »
Previously reported here, France and Germany would be among the poorest of the 50 states if they were among  the 50 states.  That study is measured in income on a PPP (purchasing power parity) basis.
------------------------------
This study is measured in consumption:

https://www.justfacts.com/news_poorest_americans_richer_than_europe.asp
"the poorest 20% of Americans consume more goods and services than the national averages for all people in most affluent countries. This includes the majority of countries in the prestigious Organization for Economic Cooperation and Development (OECD), including its European members. In other words, if the U.S. “poor” were a nation, it would be one of the world’s richest."

DougMacG

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Political Economics, Margaret Thatcher answers the Income Inequality argument
« Reply #1793 on: October 01, 2019, 08:20:57 AM »
https://www.youtube.com/watch?time_continue=265&v=rv5t6rC6yvg

My opponents would rather have the poor poorer as long as the gap between rich and poor is smaller.

G M

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Re: Political Economics, Margaret Thatcher answers the Income Inequality argument
« Reply #1794 on: October 01, 2019, 07:41:25 PM »
https://www.youtube.com/watch?time_continue=265&v=rv5t6rC6yvg

My opponents would rather have the poor poorer as long as the gap between rich and poor is smaller.

My opponents would rather have the poor poorer as long as the gap between rich and poor is smaller. it's easier to control them that way.

ccp

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cruise trip
« Reply #1795 on: October 02, 2019, 06:47:45 AM »

DougMacG

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Political Economics, Margaret Thatcher answers the Income Inequality questionnt
« Reply #1796 on: October 02, 2019, 09:17:06 AM »
https://www.youtube.com/watch?time_continue=265&v=rv5t6rC6yvg

My opponents would rather have the poor poorer as long as the gap between rich and poor is smaller.

My opponents would rather have the poor poorer as long as the gap between rich and poor is smaller. it's easier to control them that way.

Under Trump it is even more painful for them that the poor and their stereotyped "groups" are doing much better.

Confronted by a liberal friend aghast that I might support Trump, I hear, "He's despicable, I hate him, name one thing you like about him! "   I have replied that the black and Hispanic unemployment rates are the lowest in history.    Silence.   [I could add, 8 million people off of food stamps, median income up 4,000 /yr., GDP growth up, wage growth up, China on defense, ISIS in retreat, Europe starting to pay their share, Mexico helping at the border, and so on.]  That never changes minds but always leaves them speechless.  Even if their chosen media won't tell them, facts do.  Your policies don't help the poor and ours do.

Look at the question aimed at Thatcher.  When everything is admittedly going well economically under Republicans, Tories in this case, they point to inequality.   Inequality grows when people don't participate in the growth equally, which is always.  Poor people by definition are not fully invested in production.

I ordered a book yesterday, Thomas Sowell, Wealth, Poverty and Politics.  In the introduction he questions, why would people think equality is the natural state of things and that inequality is deviation from normal.  Equality isn't normal or present ever - except in the very poorest of societies.

DougMacG

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Political Economics - (commission) free lunch
« Reply #1797 on: October 03, 2019, 09:02:08 AM »
A point made in the WSJ editorials in the last couple of days:  Stock transaction costs have dropped to near zero in a free market without government intervention, regulation, prohibition or subsidy.  Even for and especially for the 'little guy'.  Why?

Yet the government intervenes in 'affordable' housing, healthcare, higher education etc and the costs keep going up and up and up.  Why?

When do big government Leftists ever stop and notice the bad results of their policies?  Does anybody ever question the validity of their arguments?

DougMacG

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WSJ: Kill the free market and Mickey Mouse is collateral damage
« Reply #1798 on: October 10, 2019, 06:52:30 AM »
Hint: Not just entertainment but all innovation, healthcare, energy, transportation, housing...

https://www.wsj.com/articles/a-disney-story-for-young-socialists-11570661652

A Disney Story for Young Socialists
Kill the free market? Mickey Mouse would be collateral damage.

The lab-coated scientist rewards a capuchin monkey with a piece of cucumber when she hands the scientist a rock. A second monkey gets a juicy grape for performing the same task, as the first monkey watches. The first monkey again hands the scientist a rock and again is given cucumber. But this time she flings it back, shaking her cage in rage. My students watching Frans de Waal’s TED video erupt in laughter.

Like monkeys, people have an innate sense of fairness. Young people who are attracted to socialism may imagine that capitalism hands the grape to Bernie Madoff. But Mr. Madoff cheated. A better capitalist exemplar is Walt Disney. He took risks, sacrificed and innovated to produce what people wanted.


American animator Walt Disney with Mickey Mouse. PHOTO: GENERAL PHOTOGRAPHIC AGENCY/GETTY IMAGES
This month marks the 100th anniversary of Disney’s first job as an artist. He was hired by Gray Advertising in Kansas City, Mo., but let go when the firm lost a big client six weeks later. He learned skills that helped him create cartoons a couple of years later at his Laugh-O-Gram Films startup, where Disney slept in his studio and subsisted on canned beans. Later he said it wasn’t so bad—he loved beans.

After the studio went bankrupt, Disney tried again in California. He recruited his brother Roy; their parents took out a mortgage to invest in their sons; and an uncle lent them his garage.

Walt’s first major cartoon character was Oswald the Lucky Rabbit. At a New York meeting, his distributor took advantage of a badly written contract to seize control of the character. On the train back, Disney shortened Oswald’s ears and lengthened his tail, creating a mouse his wife named Mickey.

Disney was a “project entrepreneur,” investing the earnings from one project into the next, more ambitious one. The earnings from Mickey Mouse shorts went into other cartoons, and eventually the audacious first full-length animated movie, “Snow White and the Seven Dwarfs” (1937). Long lines formed at theaters as Depression-era audiences embraced a hopeful story in which the little guys overcome dark times by working hard and sticking together.

Project entrepreneurs don’t use their earnings to sail the biggest yacht or display the most opulent estate. Disney’s one luxury was a train that encircled his home. Each car was big enough for one passenger. He would put on his engineer’s cap when he gave visitors rides on his little train.

When Disney took his daughters to amusement parks, he imagined something better. Walt Disney Productions was overextended with movies and short on cash, so he founded a startup to build Disneyland. He had little money in his name, so he borrowed against his life-insurance policy.

When he died, his considerable wealth was mainly in Disney stock. He had worked hard, suffered and persevered. He had put the earnings from one innovative project into the next. It was fair that he got the grape. Bernie Madoff should pay the price for his crimes, but our desire to punish him shouldn’t drive us to destroy the economic system that allowed Walt Disney to bring us Mickey, Snow White and Disneyland.

ccp

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Re: Political Economics
« Reply #1799 on: October 10, 2019, 07:21:26 AM »
Doug,
How was the event last night?
did not see it on cable unless I missed it.