Half of UK men would give up sex for six months for a fifty-inch television.
You know, if that’s the deal, considering the first twenty years of my life, someone owes me a screen the size of a drive-in theater.
Category Archives: Economics
In Praise Of Hegemony
Some thoughts from Arnold Kling.
Someone has to be the hegemon. The goal should be to ensure that it is one that maximizes individual freedom and productivity.
Humans, Chimps…
…and property rights. Some thoughts on the beginning of commerce and trade from Donald Sensing.
A Belated Defense of Giuliani’s Tax Policy
My pick for the Presidential race, Giuliani, has bowed out. I like his tax policies. Not that I thought that he could get them adopted, just that I thought that he could achieve what Bush achieved–slightly lower marginal and average taxes for 10 more years. Before you write me off as an elitist who doesn’t like graduated income taxes (which I don’t deny–but bear with me), I agree with Laffer on this point. Taxes are above the monopoly rate. This is expected since there are four (or more) toll takers: Federal income taxes, state income or sales taxes, county sales and/or property taxes, and city sales, income and/or property taxes. When you add up the various employer and employee taxes (federal only) on receiving the last dollar (ignoring the sales and capital gains taxes associated with saving or spending it), they add up in the top bracket to 35% federal + 2.9% Medicare including employer match. That is, if I get $100 in gross in the top tax bracket, I’ll have to pay $36.45 in tax and my employer will have to pay $1.45. If we frame the percentage like sales tax, I am taking home $63.55 and together, my employer and I are paying $37.90. That is a equivalent to a 59.6% sales tax on everything I buy. In other words, to get a dollar, we have to pay 59.6 cents to the government. I assert that this portion of total taxation alone is above the monopoly rate. Tax cutters would have a very easy time getting tax rates cut (and, perhaps counter intuitively, taxes increased) if they could re-frame the tax code to show tax as a percentage of net income at the margin instead of gross.
Do we really despise envy so much that we would rather have the rich indulge in additional leisure than provide the maximum amount to the Treasury?
A Belated Defense of Giuliani’s Tax Policy
My pick for the Presidential race, Giuliani, has bowed out. I like his tax policies. Not that I thought that he could get them adopted, just that I thought that he could achieve what Bush achieved–slightly lower marginal and average taxes for 10 more years. Before you write me off as an elitist who doesn’t like graduated income taxes (which I don’t deny–but bear with me), I agree with Laffer on this point. Taxes are above the monopoly rate. This is expected since there are four (or more) toll takers: Federal income taxes, state income or sales taxes, county sales and/or property taxes, and city sales, income and/or property taxes. When you add up the various employer and employee taxes (federal only) on receiving the last dollar (ignoring the sales and capital gains taxes associated with saving or spending it), they add up in the top bracket to 35% federal + 2.9% Medicare including employer match. That is, if I get $100 in gross in the top tax bracket, I’ll have to pay $36.45 in tax and my employer will have to pay $1.45. If we frame the percentage like sales tax, I am taking home $63.55 and together, my employer and I are paying $37.90. That is a equivalent to a 59.6% sales tax on everything I buy. In other words, to get a dollar, we have to pay 59.6 cents to the government. I assert that this portion of total taxation alone is above the monopoly rate. Tax cutters would have a very easy time getting tax rates cut (and, perhaps counter intuitively, taxes increased) if they could re-frame the tax code to show tax as a percentage of net income at the margin instead of gross.
Do we really despise envy so much that we would rather have the rich indulge in additional leisure than provide the maximum amount to the Treasury?
A Belated Defense of Giuliani’s Tax Policy
My pick for the Presidential race, Giuliani, has bowed out. I like his tax policies. Not that I thought that he could get them adopted, just that I thought that he could achieve what Bush achieved–slightly lower marginal and average taxes for 10 more years. Before you write me off as an elitist who doesn’t like graduated income taxes (which I don’t deny–but bear with me), I agree with Laffer on this point. Taxes are above the monopoly rate. This is expected since there are four (or more) toll takers: Federal income taxes, state income or sales taxes, county sales and/or property taxes, and city sales, income and/or property taxes. When you add up the various employer and employee taxes (federal only) on receiving the last dollar (ignoring the sales and capital gains taxes associated with saving or spending it), they add up in the top bracket to 35% federal + 2.9% Medicare including employer match. That is, if I get $100 in gross in the top tax bracket, I’ll have to pay $36.45 in tax and my employer will have to pay $1.45. If we frame the percentage like sales tax, I am taking home $63.55 and together, my employer and I are paying $37.90. That is a equivalent to a 59.6% sales tax on everything I buy. In other words, to get a dollar, we have to pay 59.6 cents to the government. I assert that this portion of total taxation alone is above the monopoly rate. Tax cutters would have a very easy time getting tax rates cut (and, perhaps counter intuitively, taxes increased) if they could re-frame the tax code to show tax as a percentage of net income at the margin instead of gross.
Do we really despise envy so much that we would rather have the rich indulge in additional leisure than provide the maximum amount to the Treasury?
Yuck
Here’s an interesting article on the economics of repugnance. As Sally Satel (and her donor, Virginia Postrel) have pointed out, an unwillingness to allow a market in kidneys is murdering thousands every year, to help ease the stomach of so-called biomedical “ethicists.”
Note to Leon Kass, and others: the “yuck” factor, like all emotions, should be viewed as suggestions, not commands.
Hyperbole
Bob Zubrin is still selling flex-fueled cars (at least conceptually), which might be a good idea, but I wish that he weren’t doing so with over-the-top rhetoric and economic ignorance. Here’s the very first graf:
Venezuelan dictator Hugo Chavez recently joined Iranian president Mahmoud Amadinejad in threatening to raise oil prices to $200 per barrel. The threat should be taken quite seriously. With no practical transportation fuel alternative to petroleum available to the world market, the OPEC oil cartel has already been successful in raising prices an order of magnitude since 1999, with a 50 percent increase effected in 2007 alone.
I disagree that this threat should be taken seriously. The notion that oil can ever get to a sustainable $200/barrel, in inflation and currency-adjusted terms, is ludicrous, regardless of the clearly malign intent of Hugo and Mahmoud. They are not capable of achieving this. No one is.
First of all, they don’t control the world’s oil markets. The Saudis (and increasingly, the Iraqis) will have a major say as well. But even if you could get an agreement within OPEC to do so (a ludicrous notion in itself, because the individual members tend to look after their own interests), it still would never happen. First, many states would cheat. But more importantly, the current price is unsustainable at near-term (over the next decade or two) projected demand levels because there are many new sources that are available at production costs much lower than current prices (e.g., tar sands and shale in the western US and Canada). The only reason that they haven’t brought down the price yet is that they’re only starting to come on line.
And if the price did somehow get to that value (as the Saudis understand, even if economically ignorant boobs like Ahmadinejad and Chavez don’t) it would cause a recession that would depress world wide demand. Also, unless you can drive the price of oil to zero, it’s not going to starve the oil dictators of their oil revenues. The only way to do that is to take away their oil (as we did with Saddam). I’m not necessarily proposing that we do so–just pointing out the only realistic way to accomplish it.
On top of this, much of the price rise that Bob Zubrin decries is due to the weak dollar, and has nothing to do with either supply or demand of oil.
Maybe such overblown rhetoric and economic nonsense will sell the concept for him; it’s certainly worked to good effect for the global warm-mongers–but I’d be more persuaded if he’d be more realistic. There are a lot of good arguments for ending the burning of oil for transportation as soon as we can, and I wish that he’d stick to them, instead of doing an impression of Gary North.
Hillary And Hayek
Some people never learn. Unfortunately, the comments don’t apply just to Hillary, but to Democrats in general. And even more unfortunately, to far too many Republicans and so-called conservatives as well.
Doomsday Has Been Postponed
We’re still not approaching “peak oil”:
A landmark study of more than 800 oilfields by Cambridge Energy Research Associates (Cera) has concluded that rates of decline are only 4.5 per cent a year, almost half the rate previously believed, leading the consultancy to conclude that oil output will continue to rise over the next decade.
Peter Jackson, the report’s author, said: