Tax Cut
Paul Krugman has a piece in today's New York Times that is misleading. As a undergrad economics major I am glad I never wasted time in a class from Paul Krugman.
Chutzpah, according to the classic definition, is when you murder your parents, then ask for sympathy because you're an orphan. But what do we call it if after you are placed with foster parents, you try the same thing all over again?
To begin with his metaphor is real extreme. I am not sure that the tax cut actually killed anyone. In fact, according to the logic of Krugman the tax cut actually benefitted GW Bush's parents. Paul, drop the extreme unrelated images and get on with your point.
Needless to say, the bill was silly by design. The administration didn't intend to compromise: it fully expected to get the sunset clause repealed in a future Congress. And President Bush was soon out there ridiculing the way the tax cut was programmed to expire, implying that the expiration date was imposed by scheming liberals, when in fact it was a trick perpetrated by his own Congressional allies.
Okay, TRUTH ALERT!! Sure, his congressional allies insisted on it, but why? To begin with, these were not his real allies. For example, the former Republican Senator Jim Jeffords insisted on it. I am not sure how he qualifies as an ALLY. And then there were the moderate senators from states that are Democratic strong holds. How can Olympia Snowe be expected to survive an election challenge from Democrats if she can't show that she has the ability to hold back the President from extreme measures? The people from Maine should be proud to have such a power broker from their state.
I agree the sunset clause is ridiculous. But, it was a political reality. As Senate Democrats have proven on the issue of judge confirmations, they are more than able, and willing, to filibuster any proposal from President Bush. The reality is that a permanent change in taxes can be filibustered, and a budget resolution cannot. Bush cleverly found a way to get a tax cut, keep moderates on board, and avoid a filibuster. I think that is good politics.
Now, how about the economics of it? I am no professor of Economics, but Krugman appears to put a very biased spin on the facts.
In 2001 a tax cut that delivered about 40 percent of its benefits to the richest 1 percent of families was marketed as a tax break for ordinary folks.
If a politician gets 60% of the vote, would you say he doesn't represent the ordinary folks? Okay, sorry that is the politician in me speaking.
Shouldn't Krugman tell us how much of the tax burden is paid by the richest 1%? A good economist should be able to provide this statistic. Using numbers from 1995 the burden was something like 29% of taxes paid by the top 1%. Still looks disproportionate to give them 40% of the tax cut? The problem is that the same study says that the bottom 20% of families contributed a NEGATIVE 2% to the tax base. Take them out of the equation and you get numbers that are not disproportionate at all. I am sure a PhD in Economics should be able to calculate that for us.
See the report for yourself
the typical family would get a tax break of only $217 next year, but families with incomes above $1 million would get an average of $93,500 each.
What does the typical family make? It would be nice to know this so that we can ask the question of the proportionality. Once again, I would think a PhD in economics would know where to find a statistic for this. Maybe he doesn't want to since defining a "typical" family can be a hard thing to do. A good Economics professor knows this. Do you define it as average income? Mean or median? Do you define it at the poverty line? Average income may be something like $60,000. At that level the percentage of income to get exempted from taxes is better for the million dollar person (0.3% vs 9%). But, there are some flaws in doing the analysis like this. To begin with, we already have seen above that the million dollar person already pays far more in taxes than the "typical" person. So, a tax cut that cuts everyones taxes by say 5% will invariably give a greater tax break to the rich. But, return to the question I asked first: what is a "typical" family? My family will get a bigger break and we live on a "typical" street with 2 kids and my wife is a soccer mom. Are we typical? We will get more than $217 from Bush's taxcut. Because the tax break is not an accross the board elimination of all taxes it is easy to find a "typical" family with no stock investments and thereby get a low tax savings from the tax cut.
It's hard to find an independent economist who thinks that the Bush proposal would create the 1.4 million jobs claimed by the administration
Krugman asserts that it is hard. About as hard as providing honest statistics related to your other claims? Let's just accept that maybe it is hard. Is that because they only think it would get 1 million jobs? Or is it because they know, as I do, that it could be possible, but since there are so many other dynamics in the economy that it is not safe to make such big predictions? Sure, I doubt we will get 1.4 million jobs. But, I don't think we will get more jobs WITHOUT a tax cut than we would get WITH a tax cut.
And bear in mind that Bush-style tax cuts now have a track record. Of the 2.1 million jobs lost over the past two years, 1.7 million vanished after the passage of the 2001 tax cut.
This proves that Krugman somehow ignores the nightly news. Let's see, has anything unexpected and shocking happened in our world since the tax cuts were made? Hmmm. I am not sure. Is it possible that some buildings fell in New York and we have fought two wars/battles? How much uncertainty does that provide to the economy?
And one day we'll realize that international investors are treating us like a banana republic — that they won't finance our trade deficit unless they are paid very high rates of interest (have I mentioned that the dollar has just fallen to a four-year low against the euro?) — and everyone will wonder why.
Paul, Paul, Paul. Why don't you provide the economically ignorant masses with a more honest assessment? The euro going up has more to do with European decisions than it has to do with a tax cut. And a banana republic? Even if the US defaulted, the US economy would still be a better investment than Costa Rica (no offense to the Costa Ricans). Paul, I am glad I never had bad Economics professors like you.
May 9, 2003
Bennett, Goldberg, etc.
Jonah Goldberg is insisting that consistency is oppresive and that hypocrisy on the part of the liberals is the real sin. I agree that liberals really have no right to make accusations of hypocrisy on the part of Bennett, when they themselves looked the other way for something much worse like Bill Clinton. The liberal accusers have weak ground to stand on.
However, this does not mitigate the fact that they picked a good item to go after Bill Bennett on. They broadcast a behavior that most followers of Bill Bennett, including myself, find to be less than virtuous. Even if he never spoke out against it, and even if he never hurt his family, and even if he did it in private and even if he didn't bankrupt himself, nevertheless he had to know he was doing something his supporters would find questionable.
Let's use an example. If tomorrow G W Bush were discovered to have begun drinking again what would be the appropriate reaction? It is legal, he did it in private, never spent more money on it than he had, and Laura knew about it. He would be discredited. The liberals who already didn't like him would have no change in ultimate view on Bush, but for the social conservative who accepted that he has changed his ways there would be a lot of disappointment. No need for an impeachment, but beyond a doubt he would not win reelection. Would that be unfair? The case could fairly be made that it is somewhat disproportionate to the error. The liberals would be hypocritical for making an issue since they obviously don't care about this behavior. But, conservatives by our nature care about virtues. Bill Bennett was all about making this point. His message was that our culture should include norms on behavior. I agree with that message. I feel that it is appropriate for our culture to make judgements about what is not acceptable in the public commons. Sometimes we will get that judgement wrong and will need to adjust our thinking but that should not prevent us from making consensus judgements about what is appropriate.
Therefore it is a mistake to rationalize away Bill Bennett's gambling. He did something wrong. Yes, the liberals who brought it up are real hypocrits for making an issue of Bill doing something they support making widely legal. But, Bill is not without blemish for his actions. At a minimum he should have realized that his fans would not look kindly on what he was doing. He made a mistake and we should say so.
Jonah Goldberg is insisting that consistency is oppresive and that hypocrisy on the part of the liberals is the real sin. I agree that liberals really have no right to make accusations of hypocrisy on the part of Bennett, when they themselves looked the other way for something much worse like Bill Clinton. The liberal accusers have weak ground to stand on.
However, this does not mitigate the fact that they picked a good item to go after Bill Bennett on. They broadcast a behavior that most followers of Bill Bennett, including myself, find to be less than virtuous. Even if he never spoke out against it, and even if he never hurt his family, and even if he did it in private and even if he didn't bankrupt himself, nevertheless he had to know he was doing something his supporters would find questionable.
Let's use an example. If tomorrow G W Bush were discovered to have begun drinking again what would be the appropriate reaction? It is legal, he did it in private, never spent more money on it than he had, and Laura knew about it. He would be discredited. The liberals who already didn't like him would have no change in ultimate view on Bush, but for the social conservative who accepted that he has changed his ways there would be a lot of disappointment. No need for an impeachment, but beyond a doubt he would not win reelection. Would that be unfair? The case could fairly be made that it is somewhat disproportionate to the error. The liberals would be hypocritical for making an issue since they obviously don't care about this behavior. But, conservatives by our nature care about virtues. Bill Bennett was all about making this point. His message was that our culture should include norms on behavior. I agree with that message. I feel that it is appropriate for our culture to make judgements about what is not acceptable in the public commons. Sometimes we will get that judgement wrong and will need to adjust our thinking but that should not prevent us from making consensus judgements about what is appropriate.
Therefore it is a mistake to rationalize away Bill Bennett's gambling. He did something wrong. Yes, the liberals who brought it up are real hypocrits for making an issue of Bill doing something they support making widely legal. But, Bill is not without blemish for his actions. At a minimum he should have realized that his fans would not look kindly on what he was doing. He made a mistake and we should say so.
May 8, 2003
Hypocrisy, Bennett and gambling
Jonah Goldberg has placed himself in an interesting position on the issue of Bill Bennett and gambling. It all started with this piece: Booking Bennett. My impression is that it has gotten a lot of attention and feedback from Jonah Goldberg readers. I assume this from all of the activity today on the National Review Online Corner.
I think much of what Jonah has to say about the issue is correct. Admittedly, I am a Goldberg fan. I consume his stuff voraciously. But as I have read his responses to emails I have come to feel that for the first time I actually disagree with Jonah. Generally, I find his arguments very sound and compelling. I often forward what he has written to friends. I guess since I have found something I don't like I should stop reading his pieces altogether. It sort of makes it hard for me to agree with all the other stuff Jonah writes since it came from the same person...
Now that would be idiotic!
And that is my point, and Jonah's original point, on Bill Bennett. Bill did something wrong, not as bad as some things he could have done, but it is wrong none the less. I will not stop being his fan, but I do have an awakening that he is imperfect by my personal standards. Consequently I will be more skeptical the next time I refer to him as an authority. But, that won't stop me from referring to him. While Jonah has clearly stated that he does not condone Bill's behavior, he has somehow allowed himself to be placed in the corner of being Bennett's apologist. His responses on NRO's Corner show this. Bill did something wrong and we should let him suffer for it and earn back his credibility the old fashioned way.
To the majority of those who are fans of a Bill Bennett, gambling is not an honorable past time. Referring to stats from someone in the gaming industry (as Jonah did) hardly passes as a legitimate and unbiased defense of gambling. Conservatives should not sacrifice our own moral authority by trying to rationalize someone elses error. This has nothing to do with consistency as the NRO Corner discussion has wasted time discussing, but everything to do with calling a spade a spade. Bennett is smart enough to have known his average fan views gambling badly and that is the point. Furthermore, he is smart enough to have known to avoid something that would have given the false impression (or even the liberals a chance to claim the false impression) of evil.
Bill -- shame on you and change your ways.
Jonah -- get back on track.
Jonah Goldberg has placed himself in an interesting position on the issue of Bill Bennett and gambling. It all started with this piece: Booking Bennett. My impression is that it has gotten a lot of attention and feedback from Jonah Goldberg readers. I assume this from all of the activity today on the National Review Online Corner.
I think much of what Jonah has to say about the issue is correct. Admittedly, I am a Goldberg fan. I consume his stuff voraciously. But as I have read his responses to emails I have come to feel that for the first time I actually disagree with Jonah. Generally, I find his arguments very sound and compelling. I often forward what he has written to friends. I guess since I have found something I don't like I should stop reading his pieces altogether. It sort of makes it hard for me to agree with all the other stuff Jonah writes since it came from the same person...
Now that would be idiotic!
And that is my point, and Jonah's original point, on Bill Bennett. Bill did something wrong, not as bad as some things he could have done, but it is wrong none the less. I will not stop being his fan, but I do have an awakening that he is imperfect by my personal standards. Consequently I will be more skeptical the next time I refer to him as an authority. But, that won't stop me from referring to him. While Jonah has clearly stated that he does not condone Bill's behavior, he has somehow allowed himself to be placed in the corner of being Bennett's apologist. His responses on NRO's Corner show this. Bill did something wrong and we should let him suffer for it and earn back his credibility the old fashioned way.
To the majority of those who are fans of a Bill Bennett, gambling is not an honorable past time. Referring to stats from someone in the gaming industry (as Jonah did) hardly passes as a legitimate and unbiased defense of gambling. Conservatives should not sacrifice our own moral authority by trying to rationalize someone elses error. This has nothing to do with consistency as the NRO Corner discussion has wasted time discussing, but everything to do with calling a spade a spade. Bennett is smart enough to have known his average fan views gambling badly and that is the point. Furthermore, he is smart enough to have known to avoid something that would have given the false impression (or even the liberals a chance to claim the false impression) of evil.
Bill -- shame on you and change your ways.
Jonah -- get back on track.
More on Bill Bennett
Just so people do not misunderstand me, let me say Bill Bennett has done the right thing by pledging to stop his gambling ways. I wish him well in giving up something he enjoys. Here are two pieces that I think are very appropriate from a conservative source.
Robert George on the High-Stakes Gamble that Bennett participated in.
Dave Shiflett: Bennett's Real Problem
Now, I do realize that Bennett is being targeted unfairly because a lot of Clinton backers hate him, but still there is a need to admit this is not the type of behavior that Bill Bennett fans exepct of Bill.
Hugh Hewitt has a good piece on Bill Bennett's Virtue
Bush's Carrier Landing
Some Democrats are complaining. Meanwhile many conservatives are trying hard to give one justification or another. My reaction? SO WHAT?!?!
Yes, there is a political element every time the President does anything. Afterall, if he sat in his office and played Solitaire people might complain as well. In my opinion Bush killed two birds with one stone. In the finest tradition of commanders riding a top a white stallion, George Bush swooped onto the deck of the most sophisticated naval vessel in the world, using technology that is unrivaled to do something few other Presidents in the world can. He inspired his troops and inspired the citizens of our nation. At the same time he reeinforced a cowboy image that his detractors detest simply because they know that most Americans love it. We eat it up for the same reasons that we cheer for our favorite sports team. I see the pictures and I say: "Yes! That's my Pres!" However, I have news for the liberals. Come election day I will vote for him not because he landed on a carrier, but because he is a leader and ultimately the landing is just a reminder of what I already know. Then again, maybe what bothers Democrats is that they know he is a leader and they really have no way to counter that.
Just so people do not misunderstand me, let me say Bill Bennett has done the right thing by pledging to stop his gambling ways. I wish him well in giving up something he enjoys. Here are two pieces that I think are very appropriate from a conservative source.
Robert George on the High-Stakes Gamble that Bennett participated in.
Dave Shiflett: Bennett's Real Problem
Now, I do realize that Bennett is being targeted unfairly because a lot of Clinton backers hate him, but still there is a need to admit this is not the type of behavior that Bill Bennett fans exepct of Bill.
Hugh Hewitt has a good piece on Bill Bennett's Virtue
Bush's Carrier Landing
Some Democrats are complaining. Meanwhile many conservatives are trying hard to give one justification or another. My reaction? SO WHAT?!?!
Yes, there is a political element every time the President does anything. Afterall, if he sat in his office and played Solitaire people might complain as well. In my opinion Bush killed two birds with one stone. In the finest tradition of commanders riding a top a white stallion, George Bush swooped onto the deck of the most sophisticated naval vessel in the world, using technology that is unrivaled to do something few other Presidents in the world can. He inspired his troops and inspired the citizens of our nation. At the same time he reeinforced a cowboy image that his detractors detest simply because they know that most Americans love it. We eat it up for the same reasons that we cheer for our favorite sports team. I see the pictures and I say: "Yes! That's my Pres!" However, I have news for the liberals. Come election day I will vote for him not because he landed on a carrier, but because he is a leader and ultimately the landing is just a reminder of what I already know. Then again, maybe what bothers Democrats is that they know he is a leader and they really have no way to counter that.
May 7, 2003
Bill Bennett
I am disappointed. And not just with Bill.
I admired Bill Bennett. He stands for what is right and has invested the time and effort to share his values. When I see him interviewed he comes across as very smart and demonstrates the ability to reason out issues. He has picked issues that I agree with and clearly communicates the positions in ways that sound reasonable. He speaks with authority. But the same traditions and values that make me listen to his messages make me uncomfortable with Bill Bennett gambling. I have pulled a slot or two while staying in Las Vegas but I think I gambled a grand total of $10. I think I can justifiably say to the public: 'I didn't do it to the detriment of my family' or 'I was always in control' or 'it is just like drinking alchohol' without sounding like an elitist that doesn't get it.
The mistake of the rich and famous is not gambling, drugs, interns or even alchohol. The mistake is pride expressed in an elitist attitude and lifestyle. They are so sure of themselves and their own ability that they feel they are above the fray. This was the problem with Bill Clinton. I know a lot of my fellow conservatives feel that Clinton was wrong because he lied to the American people; or more importantly, lied under oath. I disagree. Clinton's mistake was that he thought he was so important that he could do anything and it didn't matter. In that sense, getting jiggy with the interns was just as bad as lying. And that is where Bill Bennett gets in trouble too. Sure, gambling is not as bad as sharing cigars with interns, but the same pride and elitism is at play. The same attitude of: 'I can do whatever I want because it is no one elses business.' That is an acceptable defense for private citizens who want to live their life out of the public spot light. That is why I never really have cared about Roger Clinton or Jenna Bush. For that matter, that is why I could care less that George W Bush may have done drugs when he was young--he wasn't President then and there is no indication that he wanted to be. But, when someone chooses to become a leader or an example then higher personal standards should apply. Sure, Bill Bennett broke no law, but he clearly participated in an activity that most of his supporters find to be unacceptable.
I am also disappointed in many of my fellow conservatives. I think this is an opportunity to express how we feel about two things. First, how bad gambling is. In many situations conservatives take a stand against gambling, why not now? Second, that we are not mean. We can recognize Bill's mistake for what it is, let him suffer for a while and learn his lesson, and then forgive him. He should return to the stage after an appropriate amount of time and continue to be a voice for conservative issues. He will have to work to regain his voice of authority, but in time he should return and be back to his previous level.
Just because we as conservatives like Bill Bennett's ability to debate liberals is no reason to look the other way. We should punish our own first and then forgive him and allow him to return. If not, we are exposed to be no better than the liberal apologists who defended Clinton. We are co-opted into the shameful role of Hillary Clinton defending our own against some vast left-wing conspiracy. We are better than Democrats and we should act like it.
I am disappointed. And not just with Bill.
I admired Bill Bennett. He stands for what is right and has invested the time and effort to share his values. When I see him interviewed he comes across as very smart and demonstrates the ability to reason out issues. He has picked issues that I agree with and clearly communicates the positions in ways that sound reasonable. He speaks with authority. But the same traditions and values that make me listen to his messages make me uncomfortable with Bill Bennett gambling. I have pulled a slot or two while staying in Las Vegas but I think I gambled a grand total of $10. I think I can justifiably say to the public: 'I didn't do it to the detriment of my family' or 'I was always in control' or 'it is just like drinking alchohol' without sounding like an elitist that doesn't get it.
The mistake of the rich and famous is not gambling, drugs, interns or even alchohol. The mistake is pride expressed in an elitist attitude and lifestyle. They are so sure of themselves and their own ability that they feel they are above the fray. This was the problem with Bill Clinton. I know a lot of my fellow conservatives feel that Clinton was wrong because he lied to the American people; or more importantly, lied under oath. I disagree. Clinton's mistake was that he thought he was so important that he could do anything and it didn't matter. In that sense, getting jiggy with the interns was just as bad as lying. And that is where Bill Bennett gets in trouble too. Sure, gambling is not as bad as sharing cigars with interns, but the same pride and elitism is at play. The same attitude of: 'I can do whatever I want because it is no one elses business.' That is an acceptable defense for private citizens who want to live their life out of the public spot light. That is why I never really have cared about Roger Clinton or Jenna Bush. For that matter, that is why I could care less that George W Bush may have done drugs when he was young--he wasn't President then and there is no indication that he wanted to be. But, when someone chooses to become a leader or an example then higher personal standards should apply. Sure, Bill Bennett broke no law, but he clearly participated in an activity that most of his supporters find to be unacceptable.
I am also disappointed in many of my fellow conservatives. I think this is an opportunity to express how we feel about two things. First, how bad gambling is. In many situations conservatives take a stand against gambling, why not now? Second, that we are not mean. We can recognize Bill's mistake for what it is, let him suffer for a while and learn his lesson, and then forgive him. He should return to the stage after an appropriate amount of time and continue to be a voice for conservative issues. He will have to work to regain his voice of authority, but in time he should return and be back to his previous level.
Just because we as conservatives like Bill Bennett's ability to debate liberals is no reason to look the other way. We should punish our own first and then forgive him and allow him to return. If not, we are exposed to be no better than the liberal apologists who defended Clinton. We are co-opted into the shameful role of Hillary Clinton defending our own against some vast left-wing conspiracy. We are better than Democrats and we should act like it.
I spend a lot of time reading what this person or that person has to say on an issue and I keep saying to myself: "I should be doing that." So I decided to jump into the fray and give my thoughts on issues. There must be thousands of people doing this same thing, but why not join in. Hopefully someone will read this.
As I ponder things to post I think you should be aware that I intend to cover mostly current events. Following current events is my hobby. Granted this is a somewhat geeky hobby, but someone has to be a geek, why not me? I hope that I will not just provide the spin you can read anywhere else. Instead I hope to be introspective and share my deeper theories about things. I will also deviate occassionally and talk about other things like sports, culture, my family and so forth. If I do this I promise to provide some sort of heading or title to differentiate the content. To fill out views on some of these other topics I may even invite others to post as well since I think that they might provide some insight that I appreciate.
I hope that you will become a regular reader, give me feedback, and enjoy.
As I ponder things to post I think you should be aware that I intend to cover mostly current events. Following current events is my hobby. Granted this is a somewhat geeky hobby, but someone has to be a geek, why not me? I hope that I will not just provide the spin you can read anywhere else. Instead I hope to be introspective and share my deeper theories about things. I will also deviate occassionally and talk about other things like sports, culture, my family and so forth. If I do this I promise to provide some sort of heading or title to differentiate the content. To fill out views on some of these other topics I may even invite others to post as well since I think that they might provide some insight that I appreciate.
I hope that you will become a regular reader, give me feedback, and enjoy.
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