Saturday, October 31, 2015

Media Discussion and Tax Policy



Rubio’s tax plan increases the deficit and relaxes the tax burden on the top 1%. Bush’s tax plan increases the deficit and relaxes the tax burn on the top 1%. Trump’s tax plan increases the deficit and relaxes the burden on the top 1%. Carson’s tax plan increases the tax plan and relaxes the burden on the top 1%.

So we can agree that all the Republicans are the same since they all want to give huge tax breaks to the rich and increase the deficit, just like that bastard Reagan and his disciple George W Bush, right?

That’s what most media would have you believe. They think the CNBC moderators engaged in some pointed, worthwhile critiques of the various tax plans.

You know, I don’t entirely disagree. If your tax plan involves blowing a massive hole in the public financial budget over the next 10 years, you probably need to offer an explanation or two.

Unfortunately, that’s different than a substantive conversation on tax policy. All the discussion focuses on the headline numbers, and, explicitly, tax cuts to the “rich.” This is a Democratic framing and a liberal narrative. The Democrats are concerned only with “increasing” the deficit, since it naturally means less money for their government pet programs, and only with the effect on the rich, because they really just hate those bastards.
There’s some other interesting discussions to be had on our tax policy that some of these plans address. The Rubio plan and the Bush plan both do away with the mortgage interest deduction: that’s because Republicans widely recognize the housing bubble is a huge problem that should be prevented again, and the tax incentives to buy a home exacerbate this issue.
There’s no discussion that.
The Rubio plan allows full expensing of capital projects in the first year of expense, which entirely alters our notion of depreciation, which has grown more favorable to businesses since the “MACRS” system introduced in the 1980s.
There’s no discussion on that.
Many of these plans demand an immediate repatriation of foreign income and move permanently to a territorial tax system.
There’s no discussion on that.
Rubio’s plan expands the child tax credit, while Bush’s plan extends the personal deduction: the first benefits families with children, the second benefits everyone.
There’s no discussion on that.
There’s simply no discussion at all on any major overhauls of the tax code, except to the extent that it “decreases” the deficit ( and enables future government growth) and soaks the rich (because screw them).

This is not a mature, substantive discussion on tax policy. This is political theater dressed up as substantive critiques, which the Liberal side of the aisle adores.

This is why liberals often talk about the “tax breaks” for oil companies and airlines for private executives, which are normal investments for many companies and which all companies are allowed to expense. Again, this is not a mature point at all, it is childish political theater to suggest that oil companies should not be allowed to deduct expenses for building an oil well while, say, GM is allowed to expense a new factory.

Don’t be fooled.

To determine how a Republican President might behave in office, look at the previous Republican Presidents. Reagan absolutely did implement massive tax cuts in 1981, which were not offset by spending decreases: in fact, Reagan super-sized the military budget, so as to give the US military all manner of advanced weapons systems. This created some massive deficits throughout the 80s.
It’s important to note, though, that the Reagan 1986 tax reform was a revenue-neutral reform that closed a tremendous number of loopholes. Additionally, Reagan RAISED FICA taxes in order to secure Social Security for future generations.
 Bush Junior did pass some substantial tax cuts as well, but the actual deficit prior to the recession, IE, our structural deficit, was a low 1.6% of GDP, much lower than the 3% an economist would consider sustainable. He cut taxes, yes, but he held spending growth enough to prevent the deficit from exploding like the Reagan years. We had a small increase in the public debt, which was manageable and no real concern.
Unfortunately, that isn’t the narrative, is it?
Any of the mainstream Republicans make an appropriate President. You only need reference the moderate record of prior Republican Presidents.

Saturday, October 17, 2015

Fall Days and Projects



Don't you love this time of year? The heart simply weeps at the sheer beauty all around us. Wildlife scurries everywhere, the trees bleed color into our every day life, breweries bring out delicious ales and retire those disgusting lemonade concoctions, and even our homes fill up with warmth generously supplied by the central heating furnaces bequeathed by our ancestors.

Just a few weeks keep us from the real great times of the year, when our friends and family gather 'round the dinner table and break bread with us. Feasting has always had a great importance, and harvest festivals in particular stand out among wintering societies.

So why not get excited?!

I took the picture above at a Corn Maze a few weeks ago. For whatever reason, myself and another young man led our party of 8 through the maze this year. Can't say we did a perfect job. We managed to turn ourselves around in the Northwest Corner and did not find our way for a good 15 minutes. We will not win any records.

We spent the night drinking beer and reading scary stories by the campfire. Unfortunately, the drive home took well over an hour: Chicago, a huge city, has moved its farms well out of the city limits, making it unusual in the MidWest in that you need to actually go an hour out of your way to find a farm. Can't quite have a farm in my neighborhood, where a quarter acre of undeveloped land will go for near $300,000.

Instead Chicago adds value-add through Futures Trading, which the Chicago Board of Trade brought to us in 1864, or, historically, yesterday. There's been some pretty nasty drawbacks to that approach: Sorry about that whole AIG thing.

Not that Futures Trading is irrelevant, mind you. You can see the effects of banned futures trading in the Onion Market. The prices have proven pretty volatile in the last decade. Well-developed financial markets still are necessary for growth, and the lack of them leads to chaos: this is why China is falling off so rapidly and has dropped hundreds of billions this year to support its currency.

Thankfully, our solid work ethic, education, and markets have delivered another wonderful bounty to us, which means the Wife and I spent the last month purchasing new furniture for our home, ahead of our November 14th Friendsgiving.

On the list:
-A sectional couch with pull-out bed
-A Lazy-Boy recliner (we need a rocking chair on the first floor)
-Dining Room Chairs
-Dining Room Table

The last, that blasted table, should've arrived last weekend. The furniture store shipped a coal black, dead as night table to us instead of the rustic brown we wanted. Now they tell us they may need to give us a loaner table until they procure the correct one!

Idiots.

We're also building up our recipe repertoire. To me, that means picking up a whole bunch of vinegar: sherry, aged red wine, cider, etc. Vinegar is a highly underrated flavoring, particularly those with significant hypertension like me that don't  need the extra salt. It doesn't have the nutrients of good oils, but the acid gives things one hell of a kick.

My Wife and her friends try out new recipes weekly. This is Jenna, cutting up some apples.



I hate fruit, but they stuffed these with chocolate and developed a tasty, semi-healthy desert. Better than cramming Twinkies down your throat anyways.

On a side note, Jenna finally found herself a boyfriend. You'll remember her as the notoriously picky utterly unremarkable American Girl.

Jenna found a great guy with a great personality. I haven't met him yet, obviously, but he rides a motorcycle, hangs out with lots of middling attractive, single girls, and plays guitar. His personality is simply remarkable.

Meanwhile my architect friend bailed on our Corn Maze adventure for a date, who flaked on him. Still no word on any long-term partners there, even though that's his explicit target.

Can't make these stories up.


Thankfully I can put that aside and focus on starting my family. No news on that front yet, either. At least I have a while to paint the nursery.

Happy Autumn to all.

Friday, October 2, 2015

Narrative vs. Trend, American Politics

What's going on in American politics right now?

I live in Dem-central. Worse still, I grew up during the Bush years, specifically the Iraq War, right when Jon Stewart hit his stride and grew into a Progressive media mogul. My generation signs on to practically every left-leaning cause. We'll even vote for a self-identified socialist.


Hell, my Brother-in-Law told me Bernie Sanders is a moderate guy, and the Koch Brothers bought Hillary Clinton. Do you see what I have to deal with every day? I live in the Progressive Narrative, built on top an aggressively policed Meme-plex where even slight deviations earn a shout-down from the "Microaggressions" Crew.

The Progressive Narrative, which dominates media, goes something like this: America has drifted right-ward since 1980. The Democrats are so far right that they might as well be a right-wing party in Europe, while the Republicans might as well be on Pluto.

And after this right-wing nightmare, the American Public elected Barrack Obama, and re-elected him, in huge margins. What's left on the Republican Right is mostly racism, religious zealotry, and Big Business.

Okay, okay, that's the narrative.

What's the actual trend?

Luckily, Gallup keeps some good data. First, I want to focus on the White Vote. The nation was demographically much whiter starting in the 1950s, so if there has been a dramatic shift to the Democrats, that should be plainly obvious in the share of the White vote going to Democrats.

What does the data say?

2012:
Obama: 43 Romney: 57

Hmmmm....Romney won non-Hispanic whites by a HUGE margin....When's the last time there was a margin that large?

2008:
Obama: 44 McCain: 56

2004:
Kerry: 43 Bush: 57

Wow. Wait. Romney won as much of the White vote as Bush. Where's this HUGE Democratic shift?

2000:
Gore: 42 (+2 Nader) Bush: 56

I mean, you might start assuming Republicans have a lock on this vote, but that's not entirely true.

1996:
Clinton: 46 Dole: 45

1976:
Carter: 46 Ford: 52


You can see here that the Democrats have under-performed in the White vote for a long time, only outright winning the vote in '64, when the Republicans ran Goldwater and lost practically every single state. Republicans rode a huge backlash of white voters into the White House and an apparently complete electoral dominance.

That hasn't shifted at all.

The actual political trend, at the electorate level, has been the "browning" of America. There's obviously been a huge shift in national demographics, that has enabled Democrats to return to a majority position in government.

This is not only due to general population increase, but also an increase in turnout. The Dems have vastly increased voter turn-out among some of their key groups, particularly African-Americans. This, more than sheer vote numbers, has enabled a decisive return to the White House. Mobilizing the base always has been a major problem for Democrats, who usually have to turn out depressed, marginalized groups that just don't care much.

There's no left-ward shift. There is a change in national character, but that's because of the addition of a lot of Democratic-leaning groups, plus a lot more angry, passionate Democrats voting at the polls.

That's an important distinction. We have some historically marginalized groups that are coming to the table, seeking their place and demanding what they feel is their due, and that usually portends disruption more than unity.

The second, lesser discussed feature is that, while the White Vote has stayed the same overall, White Voters have switched party.

Take Kim Davis. She's a lifelong Democrat, believe it or not. But the Culture Wars have finally pushed her out of the Cosmopolitan Democratic Camp and into the Republican Camp.

Then take, say, Arlen Spector, who wanted to raise taxes and got driven out of the Republican Party.

The old parties were more collections of regional interests, but these days the Republicans and Democrats more closely mirror ideological groups. Both are becoming "purer." But this means both parties are becoming....well...crazier?

The Republicans unseated Boehner. True. But on the Democratic Side, look at the "insurgency" candidates. We've gone from Joseph Lieberman to Howard Dean to Barrack Obama to Bernie Sanders. At this rate, we might have Vladimir Lenin on the Democratic ticket in 2020.

That actually concerns me more than the ethnic diversity, which I know a lot of others are more worried with. The Democratic Party has grown INSANE. They were pretty "reasonable" back in the 60s, and still had a lot of crazy economics and social policy that directly created the economic disaster of the 1970s. That, more than anything else, solidifed the Reagan Revolution.

There was an internal pendulum, so to speak.

Now? All bets are off. The Democratic Party has grown a lot crazier, but they have some pretty strong demographic tailwinds. So there's no natural check on how crazy they are.

That's the trend I see, and that's why I think these next few decades might be quite interesting.