Category Archives: Politics

Politics

Creating new American jobs

Leave a comment

Five policies and programs to spur business creation and hiring:

Corporate Income Tax

Eliminate it. It’s double taxation. If you want to tax rich people, tax rich people. More importantly, it leads to shenanigans like tax inversions, keeping cash overseas, and looking for crazy legal loopholes to reduce taxes. This system favors large companies over small companies, international companies over domestic companies. Kickstart the creation of new companies by eliminating the corporate income tax.

Universal Health Care

Implement it. Give every aspiring entrepreneur the freedom to start their own thing without worrying about not getting the health care they need or going bankrupt getting it. Take the burden of providing insurance away from companies, where insurance costs can be a significant percentage of the cost of labor. Give every employer a discount on new hires by removing this cost.

Payroll Taxes

Eliminate them. They’re highly regressive, punitive for the self-employed, and ultimately a legal Ponzi scheme where current workers pay for old people’s basic income and medical insurance. Fund Social Security and Medicare out of the broader tax base, and stop arguing over when the Ponzi scheme is going to collapse. Once again, make it easier for employers to hire new workers without having to worry about these additional costs.

Universal Basic Income

Implement it. No means-testing, no applications, no judgment. Just a guaranteed Basic Income for being an adult US Citizen. When basic needs are met, people have more freedom to start new companies or new careers. At the same time, we can dramatically reduce poverty and focus on productivity.

Minimum Wage

Eliminate it. It’s a burden on businesses and ultimately leads to an increase in part-time work, just in time shift scheduling, and contracting out services to contractors. The goal behind the minimum wage is to ensure that low income workers have a basic level of income and quality of life, but this isn’t the right tool.

Five ways to pay for them:

Income Taxes

Add more brackets. Under the current system, $250k is taxed at the same rate as $500k, $1m, and so on. Adding additional brackets and higher rates at those brackets will make the tax code more progressive, ensuring that those who benefit most from our society also contribute the most.

Capital Gains Taxes

Increase them. Introduce brackets to ensure savers in the 99% aren’t taxed at the same rate as C-level executives in the 1%, but let’s drop this charade that they money made through stock, options, and other means of compensation isn’t the same as income.

BAT or VAT

Implement one or both. Either the Border Adjustment Tax or Value Added Tax will generate revenue based on economic activity in a more equitable manner, and should favor companies that make and sell stuff here in the United States.

Social Welfare Programs

Eliminate the transfer programs. Welfare (TANF), Food Stamps (SNAP), and Disability (SSDI) are all intended to provide cash assistance to people in need, but come with strict rules, differing qualifications, and a sense of shame. They’re also subject to shenanigans by the states (TANF dollars going to relationship classes and abstinence education). Universal Basic Income eliminates overhead, fraud, and abuse, and lets people make decisions about how best to spend their own money, whether that’s paying the utilities, getting a degree in nursing, or investing in some business equipment.

Deductions

Drastically scale back and phase out deductions. Deductions favor homewowners over renters, parents over the childless, religious people over the non-religious, the wealthy over the poor. It’s hidden spending and it’s a wasteful tool for social policy. If you want to encourage buying a house, installing solar panels, having children, set aside funds for each goal and ask people to apply for those funds, then deposit the funds in their Universal Basic Income account. Measure and examine the effectiveness of each policy each year and decide whether to do it again the next year. Don’t make this kind of spending universal, perpetual, and expected.

The Reality

Both parties and most taxpayers will likely reject different parts of this plan. It will never get anywhere.

Image CC BY John St John

Politics

How to keep your political career

Leave a comment

Some free, but useful advice on how to stay in politics.

12 things to avoid:

  1. Don’t take pictures of yourself naked.
  2. Don’t take pictures of your reproductive organs while wearing something tight/revealing.
  3. Don’t engage in sexually explicit conversations over the Internet or by text message.
  4. Don’t do anything remotely sexual with an underage person.
  5. Don’t have an affair in a foreign country and lie about it.
  6. Don’t have a relationship with a call girl.
  7. Don’t pay for a prostitute with a check.
  8. Don’t have an affair with someone who works for you.
  9. Don’t have an affair with someone who is married to someone who works for you.
  10. Don’t solicit strangers for sex in airport bathrooms.
  11. Don’t have illegitimate children and deny responsibility.
  12. Don’t make advances on the children of your donors.

If you do decide to ignore my advice and go ahead with any of these activities, then please pay attention to the following tips.

6 things that will make it worse:

  1. Campaign based on your squeaky clean image.
  2. Championing family values.
  3. Public and loud criticism of other people’s indiscretions.
  4. Anti-homosexual rhetoric, especially if you’re closeted.
  5. Covering up with hush money.
  6. Firing or threatening people who are involved.

And finally, when you are caught (and you will be), come clean as quickly and openly as possible. Learn how to shed a tear in public, but try not bawl. Look and sound sincere. Keep a low profile. Work hard. And then maybe, if your constituents feel like they have a connection with you, they’ll let you keep your job.

General, News, Politics

There’s no shame in walking away

2 Comments

Apparently there’s a growing number of people strategically defaulting on their mortgages. Or, at the very least, there’s a growing fear that this is happening. For some commentators, this is a sign of low moral fiber, that the strategic defaulters are somehow breaking their word, losing their honor, etc.

Bullshit.

Housing loans are not based on the belief that the borrower will pay the money back because his honor is at stake. They are based on a contract, which spells out exactly what the lender can do if the borrower stops paying back the loan. The lender can choose to take the house and sue the borrower for the difference between the house’s value and the loan amount (unless it is a non-recourse loan).

There’s also this refrain of unease that not only is the decision to default immoral, but it’s just too easy and trivial to do. That the borrower somehow escapes punishment-free for buying too much house or getting a terrible loan.

But losing your home and getting sued is not a trivial thing. Not to mention the massive hit your credit score will take. For the borrower who defaults, it means that credit will either be unavailable or offered at exorbitant rates. Moreover, employers and landlords often do credit checks prior to hiring or renting, which will further limit the borrower’s options.

Nor is it necessarily easy! The lender has the option to take the home, but no obligation to do so. If there’s a glut of inventory in a particular submarket, a backlog of defaults to process, etc., the lender can choose to send nasty letters to try to get the borrower to pay, but may hold off on actually seizing the property. In the meantime, the borrower still owns the property and any liabilities that go along with it.

Finally, there are those that mention other effects of the foreclosure, such as declining house values and higher borrowing costs within the submarket or economic cohort. But aren’t these effects the natural outcomes of a market? We are coming off a 7 year bubble; houses are going to go into foreclosure, prices will drop, costs will increase, and to expect anything else is insane.

The bottom line is that the decision to take a loss, just as the decision to purchase, should be evaluated rationally by the individuals involved. There are a lot of things to consider beyond the value of your house, the amount of your loan, your monthly income, and the monthly expenses, but morality is not one of them.

Politics

Ten Percent

Leave a comment

The Beverly Hills School District Board has a couple new members after Tuesday’s election.

Of the 21,312 registered voters in the 13 City precincts (see page 24 for a map of precincts and voter breakdown), Korbatov came in first by a margin of just nine with 1,907 votes (32.74 percent of total). Manaster came in a close second with 1,892 votes (32.49 percent of total). The other two candidates, current Board President Nooshin Meshkaty had 1,892 votes (26.91 percent of total), while Craig Davis had 458 (7.1 percent of total). 2009 voter turnout has decreased by 1,455 votes over the same election in 2007.

via Beverly Hills Courier: Korbatov, Manaster Win Seats On The School Board, New Majority To Control.

It strikes me as somewhat anti-democratic to allow anyone to take a seat with only a plurality of votes, especially when that plurality represents less than ten percent of the registered voters in the jurisdiction. The fact that two-thirds of the voters didn’t vote for Korbatov should count for something, don’t you think?

Politics

What the election means

1 Comment

Yesterday, Republicans won the governor’s races in New Jersey and Virginia, and Democrats won the seat in New York’s 23rd Congressional District. What I’d conclude from these results is:

  • Nominate a good candidate that can bring out the base
  • Campaign as a centrist to sway the independents
  • Run against an incumbent or incumbent party

I know it sounds like an oversimplification, but at least it’s not a gross oversimplification like “This is a referendum on Obama.”