The suggestion that a health care overhaul be funded by taxing doctors is made in in a Congressional Research Service report linked at the TaxProf blog. Here is the report's discussion of the income tax surcharge proposed by Rep, Charles Rangel, and of the argument that it would hurt small business and job creation:

data suggest that while business income may be somewhat more concentrated than income overall, much of small business income is associated with passive investments, stockbrokers, lawyers, doctors, and accountants who are unlikely to be innovators or important sources of job creation for lower and moderate income individuals.

Joseph Thorndike, who favors increased taxes on the rich, says designating those taxes for health care is a bad idea: "financing a mass program with a class tax is not a good idea. It obscures the connection between taxes paid and benefits received -- a connection that's necessarily tenuous for many government programs, but not for healthcare. It also undermines the notion that taxes are the price we all pay for civilized society, not just the price that some other (rich) guy has to pay." Via the Tax Foundation's Tax Policy Blog.

Even a new Hummer can qualify for a subsidy under the "Cash for Clunkers" program if it gets just one mile a gallon more than the truck being traded in, John Stossel reports.

Senator Cornyn, a Republican of Texas, has sent President Obama a letter voicing concern about a White House effort to urge citizens to report to the White House any "fishy" speech from fellow citizens about the president's health care plan. Says Mr. Cornyn: "I can only imagine the level of justifiable outrage had your predecessor asked Americans to forward emails critical of his policies to the White House." He also asks, "How do you intend to notify citizens who have been reported for 'fishy' speech?" and "What action do you intend to take against citizens who have been reported for engaging in 'fishy' speech?" The entire initiative does have a whiff of Orwellianism about it, and it's a reminder of the linkage between economic freedom and political freedom. As economic freedom erodes, political freedom may erode along with it.

The chairman of the Securities and Exchange Commission, Mary Schapiro, wants to be able to fund her agency without going to Congress, the Financial Times reports in a front-page news article today. "The agency oversees everything from mutual funds to credit rating agencies but has seen its budget decline or stay flat in recent years," the newspaper claims. That's a distortion; in fact, as we reported here, the SEC's budget actually more than doubled from 2000 to 2008, going to $905 million from $370 million. The FT article refers to the agency's "perennial resource problems." Only in Washington can an agency whose budget has more than doubled over eight years claim resource problems and get a respectful hearing in the press. Proponents of SEC spending point out that, at less than 4,000 employees, the agency has fewer staff than the Smithsonian. On the other hand, if you count up all the U.S. financial regulators, there are at least 39,000 of them.

Goldman Sachs "paid back its bailout money last month," the New York Times reports in an article that also paraphrases the firm's president as saying "that Goldman had no government backing." Only near the end of the article is it noted that Goldman "has issued billions of dollars of bonds guaranteed by the Federal Deposit Insurance Corporation." Actually it is about $29 billion worth of bonds, though the FDIC, in yet another example of the government making it hard for Americans to find out how their money is being spent, "does not report names of issuers."

The Wall Street Journal provides an update on the state of play on Gary Gensler's plan, as head of the Commodity Futures Trading Commission, to limit positions by "speculators" in energy markets. "Supporters now include several powerful entities once ambiguous or opposed to limits, such as exchange operator CME Group Inc. and Goldman Sachs Group Inc.," the Journal reports. An unanswered question is just what brought CME and Goldman on board. Was it the logic of Mr. Gensler's argument or was it some more complex calculation about the risk of angering the Obama administration by resisting? Add Goldman and CME to the growing list of capitalists who aren't standing up for free-market capitalism.

We posted on July 28 and July 30 about Senator Grassley's defense of the ethanol tariff. The Wall Street Journal weighs in today with an editorial.

"Even after all of the Fed's efforts to revive the economy, it still isn't clear it has done enough to promote a strong recovery. Economic forecasts call for the unemployment rate to linger above 8% through 2011," the Wall Street Journal says in a news article this morning. The unstated assumption is that the employment rate and the state of the economy are within the full control of the Federal Reserve. Left unexplored is the possibility that the Fed has done all it can, but that consumers are warily staying on the sidelines because they expect the rest of the federal government -- i.e., the president and Congress, to raise their taxes to pay for a health care overhaul, the "stimulus," and the auto industry bailout, and because their property rights are less secure than they were before the government started seizing companies and "saving" others left and right. In other words, if there are 60% marginal tax rates and no rule of law, the Fed can try all it wants to promote a strong recovery and it is not going to be very successful.

The Pew Charitable Trusts' "Subsidyscope" has an interesting rundown of just how bad the government is at being publicly transparent about how much it is spending.

It seems like every day a new piece of news comes in as a reminder that the federal aid to the auto industry is more than a lot of people originally realized or imagined. Today brings news that the government has set aside $1.2 billion in stimulus funds for auto-battery manufacturing and $800 million for auto-battery materials, and that the Senate will add $2 billion to the $1 billion already set aside and spent under the "cash for clunkers" subsidy. Reuters reports on $955 million in auto-industry-related asset-backet securities issued this week backed by the government's Term Asset-Backed Securities Loan Facility, or TALF. Then's there's the $5.9 billion loan to Ford from the federal energy department, along with $1.6 billion to Nissan and $465 million to Tesla. So far the total of all these programs is $13.92 billion. On top of that, the Wall Street Journal recently noted, the federal government has spent about $1.5 billion since 2001 researching hydrogen fuel cells for cars. The stimulus bill also provides a federal tax break for any state or local taxes or fees that apply to buying a new vehicle, a break whose cost to the federal budget has been estimated at $1.7 billion.

An online survey of Chinese found religious workers, farmers, and prostitutes all rated more trustworthy than Chinese government officials. Something to consider for those who think the future of capitalism is to be found in China.

We've heard the criticism that if the government can't adequately fund the 'Cash for Clunkers' program, how is it supposed to predict demand and budget for health care after an overhaul. Now Greg Scandlen has satirically taken the combination of the two issues a step further: "The Obama Administration has announced a new Cash for Geezers program. Every American family will be eligible for a $4,500 rebate for turning in their old entitlement-guzzling grandparents to a hospice program...This new program will help combat global warming, stimulate the economy, and reduce the federal deficit."

Via a link in an article in the Financial Times comes a 2005 article from the journal Economic History with the scintillating title "Populists Versus Theorists: Futures Markets and the Volatility of Prices." It begins with a quote from Vladimir Lenin (the Gary Gensler of his day), saying, "For as long as we fail to treat speculators the way they deserve -- with a bullet in the head -- we will not get anywhere at all." And it quotes Abraham Lincoln as saying of Gold speculators, "For my part, I wish every one of them had his devilish head shot off." Frustrated as Lenin and Lincoln may have been and as Mr. Gensler may be, though, the author of the article, David Jacks of Simon Fraser University in Canada, finds that "futures markets are systematically associated with lower levels of commodity price volatility." (Emphasis ours.)

In addition to the $50 million penalty we noted yesterday in the item on the GE-SEC settlment, GE spent $200 million on lawyers and accountants to deal with the alleged civil accounting fraud and the SEC investigation, the AmLaw Litigation Daily reports, noting that the company's lawyers included a former director of enforcement at the SEC. Add that cost to the punishment imposed by the government on GE shareholders, who are arguably the main victims of the improper accounting.