Category Archives: Economics

Rule Five Green Fascism Friday

Thanks again to blogger pal Doug Hagin over at The Daley Gator for the linkback!  If The Daley Gator isn’t on your blogroll, it ought to be.

Moving right along: Turns out the Green New Deal has some interesting similarities to a 20th century economic and political system that isn’t remembered fondly.  Excerpt:

Fascism was popular in the years between World War I and World War II. The exemplar was Benito Mussolini’s Italy. Mussolini was internationally admired and his tenets widely copied. Fascist and quasi-fascist governments took power in many countries, including Germany, Portugal, Romania, Argentina, and Spain.

Two important documents outline the GND. The first is a congressional resolution introduced by Occasio-Cortez and endorsed by a considerable contingent in Congress. The second is a FAQ sheet dated February 7, 2019, and formerly available on Ocasio-Cortez’s congressional website.

The documents show that the GND program is not solely, nor even principally, an environmental manifesto. It calls for, in the words of the FAQ sheet, “a massive transformation of our society.” Key elements of the program parallel fascism as preached and practiced between the world wars. Here are some examples:

First: Fascists recognize no limits to central government power. The GND sponsors seem to agree. They seek central government control over many aspects of life: health care, employment, housing, finance, manufacturing and other industry, agriculture and other land use. Not even private homes would be safe: Every home in America is to be “upgraded” to meet a range of criteria, including “affordability, comfort, and durability.”

To be fair, here are the dissimilarities:

Fascist manifestos generally call for dictatorship or oligarchical rule and the GND does not explicitly do so. But it would grant almost unlimited power to administrative agencies, and it professedly would duplicate how society was organized during World War II. The result almost certainly would be in a stronger version of the de facto executive rule prevailing then.

There’s an important distinction to be drawn between socialism and fascism, and a lot of people don’t even know what those terms actually mean.  Folks, especially poorly-informed younger people on the political Left, will sometimes toss around the term “fascist” like a six-year-old calling someone a “doody-head.”  They have no idea what the term means.  It’s just a meaningless insult.

What fascism actually is, is an economic system wherein most industry, the means of production, is still technically privately owned but production levels, prices and outputs are all controlled by government.  Is socialism, the middle-man is eliminated and the means of production is directly controlled by the government.

The Green New Deal would place government controls over vast swaths of the American economy.  The only real difference is that, instead of a Mussolini-style dictatorship, we would have a dictatorship of faceless bureaucrats; a massive Bureaucratic State in which the law would be whatever the particular NPC at some gray-steel government desk decides it is that day.

And that, True Believers, is the end of the United States as we know it.  Bernie Sanders, that daffy old Bolshevik from Vermont, may like that idea, but most folks won’t.

Animal’s Daily Stupid Idea #2,394,291 News

Kamala Harris has a stupid idea.  In other news, the sky is blue, water is wet, and Bernie Sanders has a bad haircut.  Excerpt:

Is there really a significant gap between what men and women earn? Democratic presidential candidate Senator Kamala Harris thinks so and she has a plan to fix it.

Politico:

Harris’ plan, which broadly mandates that companies prove they aren’t discriminating against women, proposes to fine corporations that don’t close their pay gaps between women and men — with the proceeds going toward building out universal paid family and medical leave.

Several studies have shown that women earn less than men, with the gap larger for Latinas and black women. Harris previewed the plan at a Sunday rally in Los Angeles, taking aim at the pay gap. “This has got to end!” she said.

The problems with this proposal begin with definitions. What is “equal pay” anyway? Even more problematic, what defines “equal pay for equal work”?

Government tries to assign numerical values to specific jobs to measure gender discrimination. But each company is different, and trying to use numbers to define value would appear to be a futile undertaking.

This isn’t stopping Harris, who wants to overhaul anti-discrimination laws and turn the system into a cash cow to fund pet Democratic social programs, including universal paid family and medical leave:

Companies would be fined 1 percent of their average daily profits for every 1 percent of wage gap during the last fiscal year, after accounting for differences in job titles, experience and performance. It would generate an estimated $180 billion over a decade.

Here’s problem number A:  When you normalize the data for payroll stats – somethings pols don’t know how to do – the “wage gap” disappears.  See also here.  And here.  And here.

But here’s the funniest bit:  The woman who is proposing this lunacy, which would create a huge Imperial bureaucracy to investigate the payrolls of every existing American business and place yet another staggering regulatory burden on the producers in our economy – the woman who is engaging in the biggest act of pandering since Caligula courted the equine vote by appointing his horse as Consul – first achieved political prominence in (where else?) California by the expedient of riding there on Willie Brown’s penis.

And she’s proposing herself as the champion of young women?  As a role model?  Don’t make me laugh.

Animal’s Hump Day News

Happy Hump Day!

Here is an interesting bit from one of my fellow Glibertarians on the idea of a Universal Basic Income (UBI.)  Excerpt:

I would do away with all the various programs and bureaucrats and whatnot and implement a partial UBI. Whoever applies for UBI gets it the next month, no means testing, no questions asked. But the kicker is, you get 120 months of this over working lifetime, say 18 to 68. It is up to you how you use your months. If you are done by 30, I have a nice ditch for you. I assume, in such a scenario, to be palatable to the majority, there will inevitably be an exception for severe disability. Outside that, this should satisfy all those who claim they want an actual safety net. 20% of your lifetime is plenty for a safety net, any more and it becomes a hammock.

I do wonder how many on the left would find this agreeable… I mean it removes a lot of the “humiliation” people go through the classic process. It can be made online and remove the stigma associated with being temporarily on welfare – although I am not sure of the wisdom of removing the stigma entirely. It can remove redundant bureaucracy and situations when people need welfare and are denied. You may be employed, but one month may need some extra cash, this is a way to get it. But it also a way to introduce personal responsibility and clear limits on welfare. I would say very few of our leftist brethren would agree…

I would agree to such a proposal (not that anyone in the Imperial City is asking me) on the condition that the new UBI replaced any and all other government payouts with the exception of pensions and veteran’s disability, as those are conditions of employment rather than transfer payments.

But other than those, yes, we replace it all – Social Security, Medicare, Medicaid, all of the various welfare and other redistribution schemes.  If you spend your stipend on stupid shit and run it out, that’s on you.  You live with the consequences of your stupidity.

Aw, who am I kidding?  The entire Imperial welfare state has been built so as to shield people from the consequences of their bad decisions.  That’s not going to change.  But it’s sure a fun thought exercise.

Animal’s Daily Random Tidbits News

1903 Springfield – a classic bolt gun

Be sure to check out Part 3 of my History of Bolt Guns series over at Glibertarians – and if you aren’t reading their morning and afternoon links on the site, you should be.

Here are some random tidbits from today’s news.

Daffy old Uncle Joe Biden is way ahead in the Dem primary polls, but does that really mean anything?  Sean Trende doesn’t think so.  One might point out that at this time in the GOP 2016 season primaries, Jeb! was largely seen as the inevitable nominee.  Maybe because the GOP has a history of nominating the worst possible candidate for any given office?

On that topic:  Al Gore may have invented the Internet in between expeditions seeking the elusive ManBearPig, but Groper Joe apparently was the first to notice global warming.  Take that, Al.

Meanwhile, the President is getting some early shots in at the likely Democrat front-runners.

And, it’s beginning to look like the DNC may be giving the loony old Bolshevik from Vermont the shaft – again.

Feral parrots are taking over America.  I have a simple solution; put a $5.00 bounty on feral parrots, and let American rednecks know they are good to eat.  Problem solved.

Speaking of invasive:  NASA may be looking in the wrong places for evidence of Martian life.  Well, they haven’t found any tharks yet, so…

Philly passed a soda tax, to try to modify people’s behavior more in line with that that city’s Top Men felt was appropriate, you know, for their own good.  (Those paternalistic fucksticks!)  Not surprisingly, it backfired.

That same daffy old Bolshevik from Vermont mentioned above is fond of ranting about how Amazon isn’t paying any income taxes.  Unsurprisingly, given his track record on economic issues, he’s full of shit.

On that note, we return you to your Tuesday, already in progress.

Rule Five Wealth Tax Friday

Fauxcohantas Warren is proposing a wealth tax to pay for all the Free Shit she proposes to hand out in the unlikely event she becomes President Imperator.  Here’s the problem:  She can’t. It’s unconstitutional..  Excerpt:

Whenever Sen. Elizabeth Warren, D-Mass., is asked how she’ll fund “free” college tuition and her many other promised goodies, she has a ready answer: a tax. Specifically, she wants the federal government to impose a 2 percent annual tax on accumulated wealth in excess of $50 million.

This is hardly a new idea. Of the 14 wealthy OECD countries with a wealth tax in 1996, 10 have since then abandoned it. With good reason: this wealth tax is economically destructive.

Even if it weren’t, a pure wealth or asset tax would be unconstitutional. Even CNN, in its fact-checking of Warren’s tax, couldn’t ignore this, noting “there are several procedural problems with the proposal, including its legality.”

Here’s why. States have a general “police power”— that is, a general authority to enact laws regulating private conduct—but Congress does not. Congress has only the specific legislative authority that the Constitution grants it, and the three relevant provisions do not authorize Congress to adopt a wealth or asset tax.

Article 1, Section 9, permits Congress to impose direct taxes on individuals if they are equally apportioned along with excise taxes and duties. The 16th Amendment permits Congress to adopt an income tax. That amendment is important because the Supreme Court had ruled that Congress previously lacked the Article I power to adopt an income tax.

Finally, Article 1, Section 8, permits Congress to adopt indirect taxes in the form of excise taxes on specific goods or transactions. Supreme Court precedent (see Knowlton v. Moore) explains that the estate tax is one such permissible indirect tax, because it is a duty imposed on a transfer of property predicated by death.

Bear in mind that the fact that a proposal is forbidden by the Constitution doesn’t stop politicians from touting this form of stupidity; Congress and the Executive Branch in particular have been using the Constitution as asswipe since about 1860.

But Liawatha’s proposal is especially egregious in its stupidity, not only for legal reasons but also moral and economic reasons.  The moral reasons are simple; a wealth tax, like any tax, is theft perpetrated by government, wherein government confiscates a portion of the citizenry’s wealth by force.  (If you don’t believe that, try not paying your taxes and see how long it takes the government to send men with guns out looking for you.)

And, as the lined article notes, several nations who have adopted wealth taxes have abandoned them due to the economic damage they caused.  Followers of the purveyors of envy like Chief Spreading Bull Warren seem to think that the wealthy keep their money in giant Scrooge McDuckian vaults so they can swim in gold coins; this is a canard.  The wealthy by and large have their assets out in the economy, invested in new ventures, funding new enterprises, new equipment, new facilities, new technologies.  That brings economic growth; that creates jobs.

Liawatha would damage all that in the name of handing out Free Shit.  That’s way to the left of stupid.

Animal’s Daily Mexican Standoff News

In case you’re one of the three people in North America who hasn’t noticed, Mexico is a real mess.  Excerpt:

More than 135,000 people have been killed since 2012. More than 1,300 clandestine graves have turned up since 2007. More than 37,000 people are reported missing. More than 600 soldiers have been killed in the drug war. At least 130 politicians and nine journalists were killed preceding the elections in July. And the violence is indeed spreading. Murder rates have risen in 26 of the country’s 32 states. In 2014, 152 municipalities accounting for 43 percent of Mexico’s population reported at least one execution-style murder per month; in 2017, the number grew to 262 municipalities and 57 percent of the population. Villages have become worse than cities: 40 percent of the population lives outside metropolitan areas but suffers 48 percent of homicides.

Most killings remain tied to the drug wars, but a growing share comes from robbery, assault, extortion, and kidnapping. “Mexico is no longer a world of cartels and capos,” says Alejandro Hope, a security specialist based near Mexico City. Organized crime networks control territory to varying degrees in 19 states and the capital, but much less of their profits comes from the U.S. drug market, which has become more competitive. The biggest new business is stealing oil from the state-owned energy company, Pemex. Mexico has the largest, most efficient black-market fuel-distribution network in the world, Hope says. In Puebla, reported thefts from pipelines spiked from 15 in 2000 to 1,533 in 2016. Guanajuato—emblematic of the good and bad Mexico—ranks third among states in job creation, thanks to its auto industry, and first in homicides, due to murders tied to fuel thefts from refineries.

Train robberies and carjackings are more frequent. Robbery of cargo trucks has jumped 180 percent in two years. Coca-Cola and Pepsi refuse to send delivery trucks into parts of Acapulco because so many have wound up stolen and burned. The rate of reported house robberies reached an all-time high of 179.4 per 100,000 homes in 2017. More than 80,000 people were reported kidnapped. Some 5,000 children have been abducted between 2007 and 2018, 40 percent from the states of Puebla and Mexico, where human-trafficking bands are known to operate.

Read the entire article, as it’s an eloquent examination of events and possible causes of the failed narco-state on our southern border.

And honestly, anyone who thinks we don’t need to completely control our southern border needs to take a good hard look at this; in fact, they should have their damn noses rubbed in it.  It’s not only likely that this crap could spill over our border, violence and corruption already is; one of the most horrific examples is the rise of MS-13 in our borders, and while their origins aren’t in Mexico, almost all of them transit Mexico on the way here.  And if you think that Mexican criminal organizations won’t eventually start to look harder at their wealthy northern neighbor, you’re probably drinking too much of your bong water.

But note the line above:  “…but much less of their profits comes from the U.S. drug market, which has become more competitive.”  It would be interesting to know some of the metrics here, which are not presented in this article.  Specifically; how much has the ongoing trend of marijuana legalization affected these profits?

I don’t know the answer to that.  And, to be honest, while I’ve long been a critic of the War on Drugs, I don’t think that our changes in drug policy are going to help Mexico all that much; they have systemic issues that go beyond that.  The Mexican criminal gangs will just turn to other malpractices if completely deprived of drug income, and you can see some examples in the article; kidnapping, robbery, theft, hijacking.

While this is a problem Mexico needs to address, it’s a significant issue that speaks to our inadequate border security.

Tax Day!

Not actually Mrs. Animal.

Tax time is stressful for all of us, but when you run your own business, things become way more complicated. I’m not sure how many times, I just want to throw up my hands and give up, but we all know that’s not really an option.

When I took over all financial record keeping over 20 years ago, we didn’t have the luxury of spending extra on anything, so I began tracking expenses so we could see the big picture. After a few years, our business income became the primary income, prompting me to create a much more detailed record keeping system.  Every penny is accounted for by category and subcategory, which account(s) are affected, and who was paid.

When tax season comes along, I run a detailed report including the categories I need to include for tax purposes. I visually go through the data to check for data entry errors (I’ve gotten pretty quick with that) and summarize all the numbers. It should be easy to just enter the numbers on the forms, and I’m done. Right?

WRONG!

Most people might not realize it, but tax laws change from year to year. And consequently, the software necessary for that changes each year as well. Tax categories seem to be fairly fluid, so for example what I put under auto services one year had to be split into separate oil change and repair categories the next, even though it’s all totaled on the final form. And I wouldn’t be surprised if it changes back at some point in the future.

To make it more complicated, while there are guidelines as to what is deductible (and at what percentage), where you account for that is not cast in stone. Office equipment, for example, includes furniture and long term assets such as printers, computers and copiers. But, if your furniture is used solely for the business, you can instead list it under supplies with paper, ink and the like. I don’t know about you, but my chair isn’t ‘used up’ at the end of the year, so this really makes no sense to me, but I’ll take advantage of the laws that benefit me.

So why do small things like this drive me crazy? Because it changes the bottom line on our personal taxes!

A pass-through partnership doesn’t pay corporate taxes. Instead everything filters to our personal taxes. But, how I choose to categorize expenses changes how much we are required pay. So if I bought an office chair for the business this year, I can put it either in depreciable assets or office supplies.

  • If it’s a supply, the total amount is expensed this year, and I don’t have to worry about it any more.
  • If I depreciate it, depending on when we bought it, there are several options for spreading out the expense, including a one time complete expense in the current year.

On the surface this looks like I can deduct the full amount either way. But it’s listed on a different line for partner expenses, which changes how the final taxes are calculated.

To put another little twist in the fabric, things like home office and auto expenses are not included on our partnership forms. We also have to submit the self-employment schedule on our personal forms to do that. (Don’t even get me started on self-employment taxes!)

Quite a few years ago, I didn’t notice a category that had previously been on the personal form had moved to the business side. Since I had already submitted our business form, it lead to a series of corrections on both sides. So each year, I don’t file any tax forms until I know I have both business and personal for federal and state(s) completed to our best benefit. Sometimes this leads me to a several variations of calculations which can confuse the software a bit, adding a little more headache.

Since I spend most of my time actually running the business, I’m sure there are ways I could legally reduce our tax burden that I’m just not finding. I wonder how our bottom line would look if a fleet of tax lawyers took a gander.

But I’d rather have a more streamlined, unbiased and fair system. Instead of penalizing success by taxing income, wouldn’t it make more sense to look into a consumption tax system?

Animal’s Daily Taxation is Theft News

Make sure to check out the final installment of my History of Lever Guns series over at Glibertarians!

Meanwhile:  Sacramento just never runs out of stuff to tax.  Excerpt:

But in California under Democrats, it’s tax, tax, tax — a drip and a drop, nickel and a dime — all the time. That’s not a political statement. It’s a fact.

Not all taxes are evil. Some are justified. But many are unwarranted. And others are eye-rollers.

One of the more controversial and annoying taxes currently being proposed is a state levy on sugary soft drinks. More on that later.

Here’s an eye-roller: A bill that would authorize San Francisco to turn its crooked Lombard Street — a tourist attraction after so many movie appearances — into a toll road, maybe even requiring reservations. Think they have a traffic jam now on weekends? Wait until cars are lined up behind a tollgate.

There are a whole bunch of taxing ideas in the Capitol: on new tires, firearms, water, prescription painkillers, lawyers, car batteries, corporations based on their CEO pay, estates worth more than $3.5 million, oil and gas extraction. The list goes on.

The oil and gas extraction tax is long overdue. We’re the only major oil-producing state without one. It would raise an estimated $1.5 billion a year.

The California Tax Foundation has counted more than $6.2 billion worth of tax increase proposals pending in the Legislature. It expects the figure to grow substantially as bills are amended with details.

Now I have serious issues with taxation in principle.  To my thinking, it’s theft.  “But Animal,” some folks have argued with me, “taxation is part of the social contract we all live under.  It’s part of being a member of a society.”

To which my reply is:  “Bullshit.  A contract is a binding agreement, codified in writing, into which all parties enter voluntarily.  I have not entered into this ‘social contract’ voluntarily.  I was dragooned into it by force, and if you doubt that, bear in mind that if I attempt to renege on what government claims is my part of the ‘contract,’ they will send men with guns out to compel my obedience.”

That’s not a contract.  That’s robbery.

And in California, you’re seeing exactly where a system that allows that sort of robbery will inevitably end up.

Goodbye, Blue Monday

Goodbye, Blue Monday!

Thanks as always to Pirate’s Cove and The Other McCain for the Rule Five links!

File this one under “Well, duh”:  Americans are mostly economic illiterates.  Excerpt:

Economic literacy has been in the news a lot lately, with some high-profile politicians demonstrating the need for some basic financial understanding. However, recent Job Creators Network/ScottRasmussen.com polling shows that the general public has a poor understanding of economic and personal finance topics as well, with a majority of Americans flunking five out of ten basic questions.

Questions revealed:

  • 75 percent of people underestimated how long it would take to pay off $5,000 in credit card debt if you only paid the minimum.
  • Only 27 percent of people knew how large the federal debt is expected to be in 2019.
  • 60 percent of people didn’t know that a rise in the minimum wage would reduce the number of minimum wage jobs.
  • Only 22 percent of people knew that the unemployment rate for Hispanic Americans was at an all-time low.

On the bright side, a majority of Americans understood the basics of supply and demand, tax deductions, credit scores, and fixed mortgage rates.

The public can take the quiz online at our InformationStation.org website, here.

It’s not just that Americans in general don’t understand these things; it’s that the generally lackwitted people who manage to get themselves elected to Congress don’t understand these things.

What’s interesting, though, is the polling results a little further down the page, which include these items (color highlighting added):

How would you rate the US economy today? Excellent (12%), Good (39%), Fair (32%), Poor (13%), Not sure (4%).

Is the economy getting better or worse? Better (36%), Worse (26%), About the same (33%), Not sure (5%).

Okay, how would you rate your own personal finances these days? Excellent (12%), Good (39%), Fair (31%), Poor (17%), Not sure (2%).

Are your personal finances getting better or worse? Better (33%), Worse (17%), About the same (48%), Not sure (3%).

Are companies in your area more likely to be hiring new workers or laying off existing workers? Hiring new workers (43%), Laying off existing workers (22%), Not sure (30%).

Add all of that up, and according to (at least) this survey, a plurality of Americans are pretty happy with the way the economy is going.  That’s certainly good news for President Trump, as the historic key metrics for a Presidential election are 1) incumbency and 2) economy.  Trump holds the high ground on both of those – oh, and it doesn’t hurt that the Democrat field is shaping up to be a race to the left, and a race of nitwits at that.

Still – November 2020 is a long damn ways away yet.

Animal’s Hump Day News

Happy Hump Day!

Oh, the horror!  The Imperial Department of Education faces a 10% funding cut in President Trump’s proposed 2020 budget!  Excerpt:

The plan, titled “A Budget for a Better America, ” requests $62 billion for the Department of Education, or $7.1 billion less than the agency’s allowance in 2019.

The budget eliminates subsidized student debt, in which interest doesn’t accrue on the loans while borrowers are in school or in economic hardship. It also reduces the number of repayment plans for borrowers and scratches the popular, if challenged, public service loan forgiveness program.

“We have also reaffirmed our commitment to spending taxpayer dollars wisely and efficiently by consolidating or eliminating duplicative and ineffective federal programs,” said U.S. Secretary of Education Betsy DeVos.

The plan would narrow the numerous income-driven repayment plans, which caps people’s bills at a percentage of their income, to just one. Under that option, students’ monthly payments would be limited to 12.5 percent of their discretionary income, compared with 10 percent now.

Any remaining debt would be cancelled after 15 years for undergraduate students, and 30 years for graduate students.

I’ve got a better idea:  Reduce their budget to zero.

Here is the Constitution of the United States; you know, the highest law in the land?  That Constitution?  Well, have a read through that, and tell me where it says that the Imperial government is allowed to meddle in education at any level.

Now, here is the Tenth Amendment to the Constitution:

The powers not delegated to the United States by the Constitution, nor prohibited by it to the States, are reserved to the States respectively, or to the people.

In other words, if the Constitution doesn’t specifically allow the Imperial government to do a thing, then they are actually prohibited from doing that thing.  Not that that hasn’t stopped the Imperial Congress from wiping their asses with the Constitution since about 1860.

To President Trump, were he to listen to me, I would have the following advice:  Grow a pair, Mr. President!  Defund the lot, and a bunch more extra-Constitutional agencies into the bargain.  Swing that axe!  You’ve talked a lot about Imperial debt; do something about it it!  Cut spending!