Thursday, March 14, 2013
Rand Rubio
Speeches from Marco Rubio and Rand Paul at CPAC 2013. A good preview of the 2015 race (not including Bobby Jindal). I have always liked Rubio. His speech is good, and he is solid. I'm not a huge fan of Rand's father, Ron Paul. As a result, I have often viewed Rand with some skepticism and distance. His speech was good, especially when talking about some of the pork. Other parts are naive and populous. Both of the Pauls' libertarian roots take a right-sided populous view without thought for unintended consequences. The speeches are worth listening to:
Wednesday, March 13, 2013
Monday, March 11, 2013
Bobby Jindal's Funny Speech at the Gridiron
I've always had a bit of indifference towards Bobby Jindal, but I like him that much more after reading these exerts from his Gridiron speech:
I’m honored to be here tonight, and to have this opportunity to represent my people.
As you know, my people are one of our nation’s most accomplished minority groups – doctors…lawyers…business owners…and of course, I’m referring to the Republican Party.
They say this is a place where you can come and tell jokes about the President…poke fun at yourself…set political ambition aside and just generally say anything you want.
Kind of like the Romney campaign.
I spoke to Mitt the other day…told him that I was doing the Gridiron dinner…he said that 47 percent of you can’t take a joke.
This of course is the night for the Washington press corps and the President to kick back, share a few laughs, not take things seriously and just generally enjoy each other’s company.
Kind of like the President’s interview on 60 Minutes.
The Gridiron Dinner used to be known as the night the media and the administration set aside their differences — back in the days when they had some.
I was on the treadmill the other day and I caught something about the supreme and infallible leader ordained from on high stepping down, and I got all excited, but then I realized it was just the Pope not the President.
...
But…what a difference a day makes…now some people have asked me if I intend to run for President in 2016?
And the answer is that I have no plans to run. I’ve made that clear, over and over again…in Iowa…in New Hampshire…and in South Carolina.
...
The truth is – I am too skinny to run. At least that’s what my friend Chris Christie keeps telling me.
Chris pointed out that my biceps are half the size of Obama’s guns. Not the president’s, Michelle’s.
...
I was one of Rick Perry’s strongest supporters. I supported Rick because he’s a loyal friend, a great governor, and…oops…I forget the third reason.
...
You’ll have to excuse me for a second. I’m drying up. I need a drink of water.
I was hoping to finally meet Mayor Bloomberg here tonight………that’s a lie
I was also hoping to see Harry Reid…..that’s another lie
...
The Menendez scandal is disturbing. Soliciting prostitution is completely unacceptable. We would never put up with that in Louisiana.
Great to see the new Senator from Massachusetts – Elizabeth Warren. My staff tells me we’ve got a lot in common.
Well from one Indian politician to another, I want to wish you all the best in your new job.
I ran into Joe Biden earlier today. I don’t think he recognized me though. He asked me to go get him a Slurpee.
...
I see Eric Holder is with us tonight. I actually heard a rumor that due to sequestration, the attorney general can only afford to ship a couple hundred illegal guns across the border this year.
I saw a bumper sticker on the way over here that said, “Honk if you’ve been released by Janet Napolitano.”
I understand that to save money – the President’s Secret Service detail is being replaced by Joe Biden with a shotgun.
Mr. President, I see a lot of famous people here tonight. Some of our top journalists. I don’t see Bob Woodward, though. He sends his…regrets.
...
You know, a lot of people warned me that if I voted for Mitt Romney, a Wall Street robber baron who hid his money in secretive Grand Cayman bank accounts would end up running the U.S. Treasury.
I see Jack Lew is here tonight. Good thing that job went to you instead, Jack.
...
This may surprise you, but I’m looking forward to President Obama’s second term.
It will be refreshing to hear him stop blaming all the country’s problems on the last four years.
People say that the President and I both have trouble laughing at ourselves.
We can’t laugh at ourselves. That would be racist.
I’m honored to be here tonight, and to have this opportunity to represent my people.
As you know, my people are one of our nation’s most accomplished minority groups – doctors…lawyers…business owners…and of course, I’m referring to the Republican Party.
They say this is a place where you can come and tell jokes about the President…poke fun at yourself…set political ambition aside and just generally say anything you want.
Kind of like the Romney campaign.
I spoke to Mitt the other day…told him that I was doing the Gridiron dinner…he said that 47 percent of you can’t take a joke.
This of course is the night for the Washington press corps and the President to kick back, share a few laughs, not take things seriously and just generally enjoy each other’s company.
Kind of like the President’s interview on 60 Minutes.
The Gridiron Dinner used to be known as the night the media and the administration set aside their differences — back in the days when they had some.
I was on the treadmill the other day and I caught something about the supreme and infallible leader ordained from on high stepping down, and I got all excited, but then I realized it was just the Pope not the President.
...
But…what a difference a day makes…now some people have asked me if I intend to run for President in 2016?
And the answer is that I have no plans to run. I’ve made that clear, over and over again…in Iowa…in New Hampshire…and in South Carolina.
...
The truth is – I am too skinny to run. At least that’s what my friend Chris Christie keeps telling me.
Chris pointed out that my biceps are half the size of Obama’s guns. Not the president’s, Michelle’s.
...
I was one of Rick Perry’s strongest supporters. I supported Rick because he’s a loyal friend, a great governor, and…oops…I forget the third reason.
...
You’ll have to excuse me for a second. I’m drying up. I need a drink of water.
I was hoping to finally meet Mayor Bloomberg here tonight………that’s a lie
I was also hoping to see Harry Reid…..that’s another lie
...
The Menendez scandal is disturbing. Soliciting prostitution is completely unacceptable. We would never put up with that in Louisiana.
Great to see the new Senator from Massachusetts – Elizabeth Warren. My staff tells me we’ve got a lot in common.
Well from one Indian politician to another, I want to wish you all the best in your new job.
I ran into Joe Biden earlier today. I don’t think he recognized me though. He asked me to go get him a Slurpee.
...
I see Eric Holder is with us tonight. I actually heard a rumor that due to sequestration, the attorney general can only afford to ship a couple hundred illegal guns across the border this year.
I saw a bumper sticker on the way over here that said, “Honk if you’ve been released by Janet Napolitano.”
I understand that to save money – the President’s Secret Service detail is being replaced by Joe Biden with a shotgun.
Mr. President, I see a lot of famous people here tonight. Some of our top journalists. I don’t see Bob Woodward, though. He sends his…regrets.
...
You know, a lot of people warned me that if I voted for Mitt Romney, a Wall Street robber baron who hid his money in secretive Grand Cayman bank accounts would end up running the U.S. Treasury.
I see Jack Lew is here tonight. Good thing that job went to you instead, Jack.
...
This may surprise you, but I’m looking forward to President Obama’s second term.
It will be refreshing to hear him stop blaming all the country’s problems on the last four years.
People say that the President and I both have trouble laughing at ourselves.
We can’t laugh at ourselves. That would be racist.
Thursday, March 7, 2013
Driving Factors of Income Inequality
In January of this year, Economist Thomas Hungerford released his study, "Changes in Income Inequality Among U.S. Tax Filers Between 1991 and 2006: The Role of Wages, Capital Income, and Taxes" Yes, quite a title.
Back in September 2012, he was the author of a study by the Congressional Research Office, “Taxes and the Economy: An Economic Analysis of the Top Tax Rates Since 1945.” The study was used by Obama as basis for his economic tax policies, and criticized by conservatives for partisan language about tax cuts. He also personally gave thousands of dollars to both Democrat campaigns of 2008, and 2012. He is hardly a tax conservative.
He has a number of points in his January paper - as seen by his title. However, I found a number of interesting conclusions in his final remarks.
He notes that gross wages as a percentage of income significantly decline from 92% in 1991 to 77% in 2006. The largest gains that eat bigger chunks of the pie are capital gains/dividends and business income.
The gross numbers add up to more than 100%, because they are before deduction of taxation. It should be noted that despite significant tax law changes, individual taxation was not materially different between the two years. However, 2001, the year before the Bush Tax cuts, individual taxes were the highest of any of the four groupings. The biggest decline over the fifteen years was payroll taxes, which is an equitable progressive savings decline across income groups.
Income inequality does widen between 1992 and 2006; however, the reasons are not based in salary. In Hungerford's words, "Wages had no or a small disequalizing effect when other incequality [sic] measures are used. Overall, changes in labor income does not appear to be a significant source of increased income inequality between 1991 and 2006."
What about tax policy? "Federal individual and corporate income taxes had an equalizing effect on inequality regardless of the inequality measure. Federal taxes had a slightly greater equalizing effect in 2006 than in 1991—taxes appear to have been slightly more progressive in 2006 than in 1991." That is AFTER the Bush Tax Cuts. He continues, "The top marginal tax rate in 1991 was 31% compared to 35% in 2006; the lowest tax marginal rate was 15% in 1991 and 10% in 2006." Another benefit of the Bush Tax Cuts often overlooked. "[T]he increased equalizing effect of the individual income tax is likely due to bracket creep—more income is taxed at the highest rates—than to tax law changes."
So why the progression of income inequality? Investment.
The highest earners are making more money by investing in growing businesses, or taking equity in their own businesses. Individual investment made leaps and bound between 1991 and 2006 (and beyond). As you can see in the chart above, income from capital gains/dividends rapidly increased over the 15 years. Some of that is the CEO options effect. CEOs and higher level managers received options grants that are not considered wages. So a CEO who once made $1.2 million a year, now makes $2.0 million plus significant equity grants. Many argue that CEOs are paid too much, and maybe they are. However, in most cases today, they aren't making the huge sums unless they are creating value - preferably long term, although the 2008 bubble showed that too much was short-term.
It's not all CEOs and Hedge Fund Managers. Obviously, the highest income earners have the greatest ability to make investments. The improved investment income isn't a zero sum game. Investment is improving our standard of living significantly. The poorest quintile of income earners all have cars, cell phones, cable TV, DVRs, and xBoxes. That's from innovation, which is a direct result of investment. The top earners are benefiting from investment gains, but society is benefiting from job creation and improved standards.
On a side note, the study was done in 2006. Part of capital gains is real estate. 2006 was close to the height of the real estate bubble. Therefore, the increased effect of capital gains may be substantially overstated. Every house flipped was a capital gain, and those in the highest income brackets tend to have the most expensive homes.
Second note, one flaw with income inequality arguments is that the participants don't remain the same. The U.S. has one of the greatest income bracket mobilities of any country on earth. The average taxpayer in today's top 1% isn't likely to be in that group again. Similarly, many in the bottom quintile and not likely to be in that quintile when surveyed again.
Income mobility makes the numbers very difficult to draw conclusions from. Yes, the rich are getting richer, but 1. it's not the same people, and 2. it's a result of how their money is invested.
Back in September 2012, he was the author of a study by the Congressional Research Office, “Taxes and the Economy: An Economic Analysis of the Top Tax Rates Since 1945.” The study was used by Obama as basis for his economic tax policies, and criticized by conservatives for partisan language about tax cuts. He also personally gave thousands of dollars to both Democrat campaigns of 2008, and 2012. He is hardly a tax conservative.
He has a number of points in his January paper - as seen by his title. However, I found a number of interesting conclusions in his final remarks.
He notes that gross wages as a percentage of income significantly decline from 92% in 1991 to 77% in 2006. The largest gains that eat bigger chunks of the pie are capital gains/dividends and business income.
The gross numbers add up to more than 100%, because they are before deduction of taxation. It should be noted that despite significant tax law changes, individual taxation was not materially different between the two years. However, 2001, the year before the Bush Tax cuts, individual taxes were the highest of any of the four groupings. The biggest decline over the fifteen years was payroll taxes, which is an equitable progressive savings decline across income groups.
Income inequality does widen between 1992 and 2006; however, the reasons are not based in salary. In Hungerford's words, "Wages had no or a small disequalizing effect when other incequality [sic] measures are used. Overall, changes in labor income does not appear to be a significant source of increased income inequality between 1991 and 2006."
What about tax policy? "Federal individual and corporate income taxes had an equalizing effect on inequality regardless of the inequality measure. Federal taxes had a slightly greater equalizing effect in 2006 than in 1991—taxes appear to have been slightly more progressive in 2006 than in 1991." That is AFTER the Bush Tax Cuts. He continues, "The top marginal tax rate in 1991 was 31% compared to 35% in 2006; the lowest tax marginal rate was 15% in 1991 and 10% in 2006." Another benefit of the Bush Tax Cuts often overlooked. "[T]he increased equalizing effect of the individual income tax is likely due to bracket creep—more income is taxed at the highest rates—than to tax law changes."
So why the progression of income inequality? Investment.
The highest earners are making more money by investing in growing businesses, or taking equity in their own businesses. Individual investment made leaps and bound between 1991 and 2006 (and beyond). As you can see in the chart above, income from capital gains/dividends rapidly increased over the 15 years. Some of that is the CEO options effect. CEOs and higher level managers received options grants that are not considered wages. So a CEO who once made $1.2 million a year, now makes $2.0 million plus significant equity grants. Many argue that CEOs are paid too much, and maybe they are. However, in most cases today, they aren't making the huge sums unless they are creating value - preferably long term, although the 2008 bubble showed that too much was short-term.
It's not all CEOs and Hedge Fund Managers. Obviously, the highest income earners have the greatest ability to make investments. The improved investment income isn't a zero sum game. Investment is improving our standard of living significantly. The poorest quintile of income earners all have cars, cell phones, cable TV, DVRs, and xBoxes. That's from innovation, which is a direct result of investment. The top earners are benefiting from investment gains, but society is benefiting from job creation and improved standards.
On a side note, the study was done in 2006. Part of capital gains is real estate. 2006 was close to the height of the real estate bubble. Therefore, the increased effect of capital gains may be substantially overstated. Every house flipped was a capital gain, and those in the highest income brackets tend to have the most expensive homes.
Second note, one flaw with income inequality arguments is that the participants don't remain the same. The U.S. has one of the greatest income bracket mobilities of any country on earth. The average taxpayer in today's top 1% isn't likely to be in that group again. Similarly, many in the bottom quintile and not likely to be in that quintile when surveyed again.
Income mobility makes the numbers very difficult to draw conclusions from. Yes, the rich are getting richer, but 1. it's not the same people, and 2. it's a result of how their money is invested.
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