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What’s Wrong With 15%?

Just a brief post to see if we can stir up any comments.

I’ve been struck by how much of the Republican primary has centered around Mitt Romney’s tax bill (as Mike pointed out).  It is interesting to note “conservatives” turning on one another regarding someone’s taxes being too low, which goes against the de facto party line to lower taxes in general.

But it’s the specifics surrounding the 15% rate that I want to talk about.  The President mentioned it in his State of the Union, and fan Warren Buffett has trumpeted his tax rate compared to that of his secretary for the last half year.  While the morality of this gets debated, what seems to not get mentioned as much is the economics.  15% is the number used because that is the tax rate on capital gains – or investment income for those of us who have no capital gains and may not be familiar with the term.  This is not a tax on wages earned or for work done.  This is money that was invested so someone else could start a business or to buy shares in an existing business that you think has potential for growth.  So our laws have created a separate rate to encourage people to engage in this behavior – and it has done just that.

But what could happen if the rate was 30% as the President suggests?  Well, what if Mitt Romney stops investing?  Let’s imagine he was getting dividend payments equal to one million dollars, so his tax paid at 15% was $150,000.  The government would love $300,000 so they raise the rate to 30%, only Mitt decides to stop investing in equity and buys steady ole treasury bonds.  So now, the government loses out on the $150,000 they would have gotten – gets in budget trouble because they projected $300,000 and now don’t have it, and on top of that they owe Mitt millions of dollars plus interest as part of the national debt.  Plus that entrepreneur that was starting up a little search engine called Google doesn’t have the seed money he needed to buy servers and programmers and such, and so decides to return to mother Russia and we all are left trying to browse the internet on Yahoo.  I can’t find a new job because Yahoo’s results return bogus results, so we are out on the streets and homeless with our 2-year old daughter.  Shivering and hungry.

Man… can’t we just let the people have 15%.

Fascinating!

This Republican Primary is just fascinating.

Mitt Romney fades in South Carolina because of concerns that he may be too rich and not paying enough taxes.

On the other hand, Newt Gingrich surges because of new revelations about his infidelity.

Wow. Can somebody explain the Republican platform to me? I’m just really confused right now.

Well after more than a year without posting – here goes!  As per my habit, this post is in reference to an article I just read.  And equally as usual it is from the Wall Street Journal – it is from the WSJ’s “random” section on the bottom of the front page.

The article is called, “A Youngster’s Bright Idea Is Something New Under the Sun”, and is about a 13-year old boy named Aidan Dwyer who won a science competition this past summer based on an idea he had about placing solar panels in the same array as leaves on a tree - hypothesizing that maybe there is a benefit to following nature’s design.

Aidan was a winner in the competition, showing that a leaf array of solar panels produced more energy… but what is interesting has been what happened afterward.  A minor uproar came up when it was discovered that Aidan had measured the wrong electrical output from the panels (voltage alone, rather than power which is combo of voltage and current) thus leading to suspicion of his results and the idea in general.

Two things stood out to me in this article.  First, the Journal talks about the response from the internet – “bad science” and “impossible nonsense” were some of the choice quotes the article pointed to.  Scientists – both amateur and professional seem to have a nasty streak .  He is a thirteen after all and just had an idea he was encouraged to explore, but I guess that doesn’t matter to many people.  Get something wrong and you are toast on the interweb.  But Aidan has also been praised for his thinking, and has been invited to speak at numerous conferences, so it hasn’t been all bad.

But the second, and most interesting, thing that piqued me was this quote from assistant professor Jan Kleissl from UCSD about Aidan’s plan for a revised experiment:

I’m certain that he will not find that his arrangement is better.  I think it’s a romantic ideal that nature has many lessons for us, and there are a few cases where this is true, but in the majority of cases we could teach nature, in a way, how to be better, faster.

Wow – how nice of Dr. Kleissl to offer nature the benefit of a “few cases” where it is better than our scientists.  I’d be very curious to hear Kleissl discuss these areas.  Have we improved upon the speed and power of lightning?  Have we developed a self-contained ecosystem on the scale of say… the ocean?   Have we developed a robot with five senses as acute as a human?  Holy shite balls this seems ludicrous.

Is it just me?

P.S.  Feels good to be back.  Sorry for the layoff, and hope I can continue to post from time to time.

Why I like Tim Tebow

The day after the Broncos lost to the Patriots and ended their winning streak, one of my Facebook friends posted the following on his status update:

“Can we shut up about Tebow now. One of the most overrated a-holes in the NFL.”

I definitely take issue with this post. It clearly shows that my friend in no way understands the Tim Tebow excitement.

First of all, Tim Tebow is not overrated. On the contrary, I have heard almost nothing but criticism for his skills as a quarterback, especially his throwing skills. He, himself, is probably his own harshest critique. What we like about him is that he’s over-achieving.

Secondly, — he’s not an a-hole. I find him to be the complete antithesis of such a character. He has carried himself with far more dignity and class than we’ve become accustomed to expect from professional athletes. So far, I’ve heard of no DUIs, wife-beatings, womanizing, dog fighting, tax evasion, or anything else that cause me to put him into an “a-hole” category.  Instead, we see exemplary sportsmanship, positive personality, humble interviews, and unprecedented determination.

Well, then there’s the Christian thing. I will concede that I’ve always had cognitive dissonance over the role God plays in professional sports. It’s kind of troublesome — while God gives one team a victory, the other gets a defeat, so is it divine intervention? Does prayer or faith really play into it? Or is it really just that one team is better than the other? Furthermore, I would venture to guess that God has much more important endeavors than the outcome of a Bronco game. But that’s just not the point when it comes to Tebow.

The Tebow point is this: He has turned his talents, successes, and celebrity over to Christ. Tebow’s success and subsequent attributions to God inspires all Christians to give God the glory in our lives. I certainly don’t know the guy personally, so I certainly can’t question his true heart. Does he give God the glory because he believes that it will help him win football games? Or does he win football games so he can inspire people to follow Christ? I don’t know. I do know that I’ll take his antics over Randy Moss’s any day.

I was disappointed by the loss to the Patriots, and I hope it doesn’t spoil the momentum, but it’s not going to make me shut up about Tebow. I will shut up about Tebow, however, if he’s unable to display the same quality of character in defeat as he does in victory.

Nobody has posted anything on this blog in a long time. I’m wondering why that is. Are all the writers too busy? Have past discussions gotten too divisive? Do we have different blogs that we like better? Hmmm? Or is it possibly because of the ridiculous state of politics in America right now?

Whatever the reasons, I miss our fights, so I’ve written a few jabs, just to remind everyone of how fun it was to spar over that which we cannot change and, in truth, don’t completely understand:

1. Obama should be very beatable in 2012, but the group of republican candidates are so weak that he still might win.

2. Right now the essential difference between those of us who vote Democrat and those who vote Republican is which lies we choose to believe.

3. The Democrats plan to fund payroll tax cuts was wealth re-distribution — take some tax money from the rich to give it to the middle class and poor. Bad idea. The republicans plan was also wealth re-distribution — take jobs away from middle class people and give that money to other middle class and poor people. Worse idea. I understand that they’ve reached a compromise, and I don’t know what it looks like, but I’m pretty sure it will amount to the worst combination of the two ideas…and a controversial pipeline from Alaska.

4. Just a reminder: Newt Gingrich had his own affair at the same time he tried to impeach Bill Clinton for having an affair.

5. He also opposes child labor laws.

6. My pick of the Republican candidates: Newt Gingrich.

7. My prediction: Tim Tebow will become the next John Elway. And then he’ll run for president. And I’ll vote for him regardless of his opinions.

I would imagine that conservatives should be very happy about the increase in unemployment announced last week. For one, they can blame the Obama administration for it, and two, because the increase is the result of a half a million reduction in public sector jobs, and they want that, too.

Interesting Question

In my last post, I came across a question that I found interesting, so I thought I’d turn it into a post.

Right now, Republicans are attempting to dismantle the Affordable Care Act with legal action claiming that it’s unconstitutional for the government to require people to purchase health care.

Of course the reason for this mandate is because health insurance companies have made it clear that when healthy people don’t buy health insurance, the insurance companies can’t afford to pay the medical bills of the unhealthy participants. It’s especially problematic when the law now longer allows exclusions for pre-existing conditions.

Of course the biggest problem is when these non-contributers get sick and then go to the emergency room to receive free care. In these situations, those who pay for health insurance subsidize those who don’t, and it raises costs for everyone.

Now, Republicans are suggesting that we switch to a cafeteria plan for Medicare. In this situation, the government will pay a set subsidy, and the burden of increased health insurance costs will fall onto the senior. I certainly understand that many of you have so much faith in free market that you believe that the subsidy will always be enough to pay for the insurance. However, similar programs so far haven’t done so. According to an NPR bit, costs in such plans go up higher than in Medicare.

So let’s just agree that it’s possible that the cost of the plans could go higher than the subsidy. In this case, would the seniors be required to purchase Medicare? And if so, how will Republicans argue this legally?

I haven’t posted anything on this blog in a long time, and that’s not because I’ve had nothing to say.

It’s because I believe that this country is in a cold civil war right now. It’s very clear that politicians no longer believe in policies based on common ground. Instead, they aim to defeat opposing viewpoints and impose self-serving policy on everybody.

It’s my belief that Republicans have launched multiple attacks not only on the Democratic point of view, but also on entities that support that point of view and on the middle class in general. My guess is that my brethren on the right probably feel the same way about Democrats, and I wouldn’t attempt to disagree. My impression at this point, however, is that Democrats are too naive to realize they are in a cold civil war. Therefore, they continuously try to negotiate with the enemy and it’s getting them nowhere. As a result, their constituents will eventually demand they adapt republican tactics and launch their own offensives.

It’s because of this rhetorical tenor, that I’ve been hesitant to post my opinion. Personally, I don’t want a war, even a cold one. Although my point of view fits snugly in the left-to-center corner of political thought, I firmly believe that policy is stronger when it’s more broadly informed. In other words, even though I disagree with Republicans on many issues, I believe that policy will be stronger when it represents their points of view along with mine. I don’t see it being to my advantage to defeat Republicans, but I do think my perspective is important.

Therefore, I want my posts to find common ground and not draw battle lines. I’ve certainly been guilty of throwing a few rhetorical jabs, and probably a few low blows at that (there’s a couple in this post), but I’ve meant for them to be discussion starters and not attacks.

Well anyway, here’s something about which we can probably all agree. It’s time for both parties to stop making appeals to “The American People.” It’s infuriating to me when I hear TEA party zealots claiming they’re efforts are for “American People,” when what they are doing is completely against everything I believe in and much of it will directly detriment my livelihood. The GOP “Contract with America” is case in point. I didn’t sign this contract, and I don’t believe in it. Don’t pretend it has anything to do with the “American People.” It’s a battle strategy devised to beat the enemy, and I, an American person, am one of those enemies.

So please join me in demanding that politicians from both sides refrain from using this platitude until the cold war is over.

 

Who Will Apologize To Toyota?

Almost a year ago I wrote a post about Toyota and the troubles they were having with recalls and sudden acceleration problems.  The post and ensuing comments almost entirely dealt with the issue as a proxy for capitalism in general.  The Wall Street Journal reports today that the NHTSA has released its findings from a 10-month study (completed jointly with NASA) and what was its key conclusion?

The NASA/NHTSA study highlighted a delicate issue for auto makers and regulators: The vast majority of sudden acceleration incidents studied were determined to be the result of driver mistakes. The NHTSA said it will continue to study measures aimed at reducing the risks of unintended acceleration caused by drivers mistaking one pedal for another. (emphasis added)

I would be curious to know what that number or percentage is, because the article is clear to point out that sticking pedals and sliding floor mats were still responsible for some – but “vast majority” is pretty heavy language that would indicate that maybe Toyota was not the evil scourge of capitalist greed that people feared, and that maybe there was a bit of a witch-hunt put on for the media.  How about this from the Transportation Secretary in the same article:

At a Congressional hearing last year, Transportation Secretary Ray LaHood had suggested that consumers should stop driving their Toyotas. On Tuesday, he said: “We feel that Toyotas are safe to drive.”

That’s a convenient swing.  Meanwhile Toyota has been dealt huge losses from the lost consumer confidence, that turns out to have been misguided by runaway stories and a deluge of what must be frivolous lawsuits.  To be fair, the article states that there are groups that reject the findings in the report… so there is the possibility that this story could come back again full circle.  I don’t pretend to have a solution (or even to want a solution) to this day and ages immediate news spread – perhaps that is just a cost of doing business.  But I would be amazed if somehow the news spreads as quickly or furiously about the results of the findings?  And that is the point of this post – who will apologize?  The people who sued when they knew (or at least later learned) that they were at fault?  Will the newspapers print bold headlines declaring Toyota safe?  Will the congressional members who called for Toyota executives to be grilled on national television say sorry on that same stage?  Don’t hold your breath.

Food Inc.

I just saw this documentary a couple weeks ago.  Have you seen it?  If not, you should.  Jana and I joined an “ethics of food” group at our church a couple years ago and learned much of what the movie had to say, and we’ve been buying grass-fed beef ever since (along with other ethical consumption choices).  So while there was little in the movie that was really groundbreaking for me, it did get me thinking about this topic.  I offer the following four thoughts/observations about the movie, and the food industry in general:

1) We need to end corn subsidizes.  The affordability of corn as a result of government subsidizes has created distortions and wreaked havoc all across the food industry.  The best example is that corn is fed to cows, because it is so cheap.  But cows were not designed (or, as the movie would have it, evolved) for corn, but grass.  The corn diet makes the cows sick, so we inject them with all kinds of medicine and hormones to counter the effects of the corn.  Let’s allow corn to rise to a market price- it will save tax payer money and possibly make for healthier cows and better beef.

2) Capitalism has been a mixed bag for food.  The free market has created incredible efficiencies in food production and has caused the price of food to drop considerably.  But I also believe that there are downsides to these efficiencies that are uniquely troublesome, since the raw materials of the food industry are living creatures.  The movie leans towards the conclusion that the free market has been almost completely bad for food- I disagree, but admit that there are some perils in the application of free market principals to food production.

3) The free market is the most efficient path to righting the wrongs of the food industry.  What I mean is that as more people refuse to eat corn-fed cows, the market will shift.  The movie points out that this has already happened- Wal-Mart has stopped carrying milk from cows with the rBST hormone, because consumers stopped wanting it.  We have access to far more ethical food choices now than we did 10 or 20 years ago (have you been to Whole Foods?).  We also have access to information, such as this movie, which will help drive consumption choices.  I’m not saying that the free market is the only way to address the wrongs, just that it does possess the power to do so and is already doing so to a large degree.

4) Michael Polin is a cool guy.  In the food group that Jana and I were a part of we read Michael Polin’s “In defense of food” which is a great read.  My guess is that Polin is pretty hard to the left, but even if that is the case he is really thoughtful and reasoned in all of his commentary, and he seems to have a learning spirit to him, that he will follow his passion for good food where ever it leads him, whether that’s to liberal or conservative positions.  I could be giving him too much credit, but I’ll just say that he seems like a really thoughtful guy.  If you haven’t read “In Defense of Food,” I highly recommend you go do so.

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