Archive for December, 2012

"Hear the Bells"

Every Christmas Eve, before the kids go to bed, we listen to Mannheim Steamroller’s "Silent Night" as the last thing in the day. Usually I’ll say a little something about remember family far away, or about soldiers deployed during this time. It’s usually short.

However this year, with the Newtown shooting, and getting some inspiration from different sources, I wrote this up. It gives us some perspective; how good most of us have it, how much some people are hurting, and how much God has for all of us.

And I dare you not to cry when you hear the toy piano plink out "Silent Night".

Merry Christmas.

Doug

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    Potential Remedies for the Fiscal Cliff

    I have a lot of vacation saved up for the end of the year, so I have to take quite a bit of it so I don’t lose any. (We, like many companies, can only carry so many days of one year’s vacation into another year. Part of the reason is so that people have to take vacation and not get burned out.) So I’ll be off the rest of the year, and this will likely be my last post of the year. When I return, we will have gone off the so-called "Fiscal Cliff", or we’ll have come to an agreement to avoid it.

    As the countdown to the Fiscal Cliff continues, tax increases seem to be the only way Democrats in Congress think that we can close the deficit gap. But Michael Barone points out that, no, tax increases alone will never be enough. It’s not the panacea that Democrats claim it to be. He covers some ideas that I’ve mentioned here, like the fact that entitlement spending alone is enough to keep a deficit going. You might think tax increases are helping, but we’d just be sinking slower. Some I’ve engaged in on this subject have said, “well, at least that’s in the right direction”. Sure, if you can hold your breath indefinitely. No, the right direction would be to start rising and get above the water level.

    Another point is that higher tax rates don’t typically produce more tax revenue. From the 1940s to the 1960s, when the top marginal tax rate was 91% (91%!), tax revenues always bounced between 15 and 21% of GDP. Why? Because with a tax rate like that, people spend more time looking for tax shelters and other means, legal and illegal, to keep from paying those high rates. Thus, the Congressional Research Service notes that, during those times of 91% top rates, the effective tax rate on earners in the top 1/100th percent was 45%. Now, I understand that only income over a certain amount was charged that 91% rate, but even the tiniest sliver of earners at the very top, the absolute richest of the rich, were still paying an aggregate of less than half the rate. Some studies put it at 1/3rd the rate. This is simple pain avoidance. Threaten to poke me, and I’ll defend myself.

    And so from 1948 until now, with up economies and down, with huge marginal tax rates and smaller ones, under Republican Presidents or Democratic, the total US tax revenue taken in as a percentage of GDP has stayed remarkably consistent in the same range; between 15 and 21%. The tax rate made precious little difference in how much of the economy was taken in taxes.

    The lesson, then, is this: grow the economy and restrain spending. If we’re going to get the same percentage of the economy in taxes, then to get more tax revenue, you must grow the economy. And as Barack Obama himself said in 2009, “you don’t raise in a recession.” Now, you might say we’re coming out of the recession, but his proposal for $50 billion more in yet another stimulus says he thinks otherwise. Don’t read his lips; read his proposals.

    But, once you get those increases revenues, don’t spend that and more on, well, another stimulus, which, by the administration’s own numbers, grew the economy and the jobs at a slower rate than doing nothing. No, taking more in is not a license to spend it. But it’s what government does. That’s why any deal which includes higher taxes may look like a healthy compromise, but it’s nothing more than a ruse that will put us further in debt.

      Tax Hikes Will Never Be Enough

      As the countdown to the Fiscal Cliff continues, tax increases seem to be the only way Democrats in Congress think that we can close the deficit gap. But Michael Barone points out that, no, tax increases alone will never be enough. It’s not the panacea that Democrats claim it to be. He covers some ideas that I’ve mentioned here, that entitlement spending alone is enough to keep a deficit going. You might think tax increases are helping, but we’d just be sinking slower. Some I’ve engaged in on this subject call that the “right direction”. No, the right direction would be to start rising and get above the water level.

      Another point is that higher tax rates don’t typically produce more tax revenue. From the 1940s to the 1960s, when the top marginal tax rate was 91% (91%!), tax revenues never topped 20% of GDP. Why? Because with a tax rate like that, people, spend more time looking for tax shelters and other means, legal and illegal, to keep from paying those high rates. Thus, Congressional Research Service notes that, during those times of 91% top rates, the tax rate on earners in the top 1/100th percent were paying only 45%. Now, I understand that only income over a certain amount was charged that 91% rate, but even the tiniest sliver of earners at the top, the absolute richest of the rich, were still paying an aggregate of less than half the rate. Some studies put it at 1/3rd the rate. This is simple pain avoidance.

      And since 1948, with up economies and down, with huge marginal tax rates and smaller ones, under Republican Presidents or Democratic, the total US tax revenue taken in as a percentage of GDP has stayed remarkably consistent between 15 and 21%. These charts are worth checking out. They show this, as well as how other things, like federal debt or government expenditures, have changed relative to GDP. It is really worth your time to check out.

        Do You Really Own Your Property?

        We were told, point blank, that we don’t, by a local government employee.

        Here’s the story. In the tiny town we live in, apparently there have been an increasing number of code violations regarding, among other things, people parking cars on their lawns, off the driveway. My wife, returning from our town’ s annual Christmas parade, was pulling up to our house with plans to park on the street in front of our house for the moment. She saw a Code Enforcement car coming down our dead-end street, and parked a little bit further off to the side, thinking that maybe this officer might be concerned that she was blocking too much of the street. In doing this, about 1/3 of the tire width was actually on the grass; a few inches.

        When the Code Enforcement office turned around and came back down our street, he rolled his window down and said to my wife that, FYI, he was patrolling for, among other thing, cars on lawns and that, technically, he could cite her for her current parking situation, but wouldn’t this time. In the ensuing conversation, he told her a number of very odd things.

        Now, I understand if a community doesn’t want to live in an area where people regularly park on their lawns. I can see erosion issues, and I can understand that this could lead to people who turn their property into auto mechanic yards. He mentioned that cars can leak fluid and it would get into the water supply. (Of course, those leaks from a car on the road would wind up in the storm drain where it would go directly into the lake behind our house, unfiltered by the ground. But he didn’t seem to realize that.) The community decides that it will make certain rules about how you keep your property, and you might get fined for breaking these rules, but it’s still your property. Not according to this guy. In his mind, since the government can create restrictions on what you can do, then it’s not your property. You only have the license to use it. He didn’t go into who actually owns it or who you’re licensing it from, but he was quite clear that  our ownership of the property was an illusion.

        And, since I can’t, for instance, use my house as a factory, then I don’t really own that, either.

        Really?

        Now, my guess is this is just one, incredibly misinformed, random government worker we ran into. But still, is this indicative of a bigger issue regarding what government thinks? Perhaps folks at higher levels still do, in fact, understand the concept of private property, and that having regulations on the use of something doesn’t mean the regulatory body owns it. But really, this is unbelievable.

        I can be put in jail for child abuse. Wonder what this guy thinks about my kids.

        Doug Payton blogs at Considerettes and podcasts at "Consider This".

          Death Panels in the UK

          From the Daily Mail in London:

          Sick children are being discharged from NHS hospitals to die at home or in hospices on controversial ‘death pathways’.

          Until now, end of life regime the Liverpool Care Pathway was thought to have involved only elderly and terminally-ill adults.

          But the Mail can reveal the practice of withdrawing food and fluid by tube is being used on young patients as well as severely disabled newborn babies.

          One doctor has admitted starving and dehydrating ten babies to death in the neonatal unit of one hospital alone.

          Writing in a leading medical journal, the physician revealed the process can take an average of ten days during which a  baby becomes ‘smaller and shrunken’.

          The LCP – on which 130,000 elderly and terminally-ill adult patients die each year – is now the subject of an independent inquiry ordered by ministers.

          The fact is, when a bureaucracy pays for health care, its main focus over time becomes the money, not the lives. This, frankly, must happen when we hand over our freedoms to the government. Human nature fairly dictates that, again over time, our better natures lose to the almighty dollar/pound/euro. When we, individually, determine how and where our money’s spent, we can make better choices than society in the aggregate.

          Individuals have a conscience. Government entities don’t.