A new Gallup Poll of 1017 American adults conducted September 8 to 11, 2011 found: "Americans estimate that the federal government wastes 51 cents of every dollar it spends, a new high in a Gallup trend question first asked in 1979. The current estimate of 51 cents wasted on the dollar is similar to what Gallup measured in 2009, but marks the first time Americans believe more than half of federal spending is wasted. The low point in the trend is 38 cents wasted on the dollar, in 1986."
This is by the director of the Adam Smith Institute, Eamonn Butler, and ran in the Wall Street Journal Europe under the headline "The Moral Case Against Soaking the Rich":
Evidence from across the world is clear: take more than a third of people's earnings, and you unleash a silent tax revolt. Citizens rearrange their affairs in order to avoid the tax, or work less and retire early, or move their money or their businesses or even themselves abroad. They may even evade the tax by lying about their wealth and income, or taking payments in cash. And people abroad will be discouraged from investing in your country.
It is no wonder that low-tax countries grow much faster than high-tax ones. This growth-rate disparity is not just an economic problem, but a moral one. High taxes choke off business, employment and growth opportunities that would benefit the whole population. It cannot be "fair" to make everyone worse off....
From yesterday's Politico Playbook: "WELCOME TO THE WORLD: Stephanie Allen, speechwriter for CFTC Chairman Gary Gensler, and POLITICO's Jon 'Huddle Up' Allen welcomed Asher Henry Allen -- 'Ace' -- to the world. Six pounds, 19 inches long. Mom's smooth delivery augurs well for Asher's pitching career. "
Bloomberg News notices that among President Obama's proposed tax increases is a new $100-a-flight fee for corporate jets. Like most of the tax increases, the fee is justified in terms of "fair":
"General aviation users currently pay a fuel tax, but this revenue does not cover their fair-share use of air traffic services," the plan said.
But if "fair" is the issue, why not make the $100 fee apply to all flights, or to all passengers, or by pound of weight flown, rather than imposing it on corporate or private jets alone?
The Bloomberg article supports the "both parties do it" idea:
A similar proposal introduced by President George W. Bush's administration was defeated in Congress...
That plan, which was introduced in 2007, was supported by the airline industry, which argued that corporate aircraft owners should pay a greater share.
Hooray for at least one capitalist willing to stand up publicly against President Obama. From an article in the Wall Street Journal:
Leon Cooperman, the New York hedge-fund manager who runs Omega Advisors, called Mr. Obama "anti-business," "anti-wealthy" and "socialist." "All he's doing is attacking wealthy people," Mr. Cooperman said in an interview.
Pass the free trade agreements with Colombia, South Korea, and Panama. As the Chamber of Commerce's Tom Donohue puts it, "every day that we delay these FTAs, American workers, manufacturers, and farmers risk losing business to our competitors. In short, kiss American jobs and growth goodbye." President Obama supports all three of these agreements. Critics say they would cost some jobs to foreign trade. But they'd net out as job-creators because they would cut tariffs on American exports and prices for American consumers on imports.
Earlier:
Cost-Free Job-Creating Idea No. 7: Moratorium on significant new regulations until unemployment rate returns to pre-Obama level of 7.7 percent.
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Reason.com has posted my latest weekly column, about President Obama's tax-increase speech delivered earlier today:
At moments in his September 19 speech, Mr. Obama almost sounded like Steve Forbes, or some other free-market tax reformer. Mr. Obama mentioned that the tax code was more than 10,000 pages long, that the volumes stacked atop each other would be five feet tall, and that America's corporate tax rate is among the highest in the world. I half-expected, half-hoped that the next words out of Mr. Obama's mouth would be a Forbes-like plea to "kill it, drive a stake through its heart, bury it, and make sure it never rises again to terrorize the American people."
But if fundamental tax reform and simplification is the goal—and it's a worthy one—linking it to a $1.5 trillion tax increase is, alas, a sure way to kill it.
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Today's cost-free job-creating idea comes from Ron Johnson, a Republican senator from Wisconsin. It is the Regulation Moratorium and Job Preservation Act, which provides that no federal agency "may take any significant regulatory action until the unemployment rate is equal to or less than 7.7 percent." "Regulatory Action" is defined in the bill to mean "any substantive action by an agency that promulgates or is expected to lead to the promulgation of a final regulation, including notices of inquiry, advanced notices of proposed rulemaking, and notices of proposed rulemaking."
A press release from Senator Johnson explains: "During the Obama Administration, the unemployment rate has never been lower than it was the day the President was sworn in, when it was at 7.8% Johnson's legislation prohibits federal agencies from implementing any new significant regulatory actions until the nation's unemployment rate falls to 7.7% It allows the President to waive the rule for regulations dealing with national security, or national emergency."
With President Obama this morning laying down his "Buffett Rule" that "Warren Buffett's secretary shouldn't pay a higher tax rate than Warren Buffett," Commentary magazine has posted a special preview of my 2,000-word article from the October issue, "The Buffett Tax Gambit." The link is here, and I encourage everyone to have a look.
Commentary stripped the hyperlinks out because the article was for the print edition, but for those who are interested, here they are:
Report of Mr. Buffett's June 2007 remarks on taxes.
Mr. Buffett's October 2007 interview with Tom Brokaw.
Mr. Buffett's November 2010 appearance on ABC's "This Week."
Time magazine has published an article I wrote about buying my most recent pair of eyeglasses. The point is about how competition and technology can decrease prices for consumers. I didn't really get into the antitrust enforcement angle for the Time audience, but FutureOfCapitalism readers may be more interested. From the Time article:
The Warby Parker Web site explains that the eyewear industry "is controlled by a few large companies that have kept prices artificially high, reaping huge profits from consumers who have no other options." And it's true that the Luxottica Group, an Italian company, owns Ray-Ban, Oakley, and Oliver Peoples, as well as LensCrafters, Pearle Vision, and Sunglass Hut, while also controlling the license for glasses sold under the Paul Smith, Polo Ralph Lauren, Brooks Brothers, and Prada labels.
If President Obama is really going to impose a "Buffett Tax" or "Buffett Rule" to raise taxes on those earning more than $1 million a year so that they pay the same percentage of their earnings in tax as middle-income Americans, then a simple increase in income taxes along the lines the president reportedly is going to propose won't really do the trick for Mr. Buffett. To really "stop coddling" Mr. Buffett would require at tax on foundations with more than $1 billion in assets and a tax on corporations with market capitalization of more than $100 million. I'm not advocating either of those, but to just raise Mr. Buffett's income taxes wouldn't mean much to him, because his taxable income is low compared to the assets he controls. (The New York Sun editorial Buffett's 'Income' has some useful background.)
Separately but relatedly, the New York Times article about the Buffett Tax explains:
Mayor Bloomberg is warning of Cairo or Madrid-style riots in the streets of America if the government doesn't do something to create more jobs, according to a Daily News account of his radio appearance.
It's the sort of strange comment that gets people annoyed at the mayor, until they realize that if a Democrat or Working Families Party candidate were in office, the politician might not just be warning of a riot, but encouraging or leading one. For what it's worth, New York City's unemployment rate for August 2011 was 8.7%, slightly better than the nation as a whole, which was at 9.1%, but worse than New York State overall, which was at 8%.
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