"One should either write ruthlessly what one believes to be the truth, or else shut up." — Arthur Koestler
Jimmie Bise observes the pecuniary motive:
General Electric . . . by some happy coincidence, managed to pay no US taxes this past year despite receiving a $140 billion gift from the administration.
Prompting Jehuda to recall the Corleones:
“And we have newspaper cable news people on the payroll, don’t we, Tom?”
Ah, but the Corleones had honor. Big difference.
“The Congress shall have Power . . . To make all Laws which shall be necessary and proper for carrying into Execution the foregoing Powers . . .”
— U.S. Constitution, Article I, Sec. 8, Clause 18
“In the last week we have gained tremendous momentum in our effort to keep carry-on bags free. We have begun to put the brakes on runaway and out-of-control airline fees.”
— Sen. Charles Schumer, New York
A senior Iranian cleric has claimed that dolled-up women incite extramarital sex, causing more earthquakes in Iran, a country that straddles several fault lines, newspapers reported today.
“Many women who dress inappropriately . . . cause youths to go astray, taint their chastity and incite extramarital sex in society, which increases earthquakes,” Ayatollah Kazem Sedighi told worshippers at overnight prayers in Tehran.
I’d be the mack daddy in an Iranian singles bar: “Sweetheart, you’re looking like the epicenter of a 7.4 on the Richter scale. How about you and me go back to my place and make the earth move?”
UPDATE: Welcome, Instpundit readers.
Personally, I think she ought to at least offer to use the money to go to Vegas or New Orleans, but gasoline and eggs and cheering her up are also worthwhile projects, I suppose.
Besides everything, I mean. Christine Romer’s neo-Keynesian analysis of the economic slump — “It’s Aggregate Demand, Stupid” — inspires Yglesias to spout ignorantly about “structural” unemployment:
Every time there’s a downturn a certain swathe of the elite starts to label it unfixable and structural.
He then goes off to argue that the problem with U.S. policy is that it has been too cautious:
The fact of the matter is that key people responsible for running the global economy—people at the European Central Bank and the Federal Reserve Board, and the Bank of Japan, people in the United States Senate, people in the Germany cabinet—are screwing up. In the developed world, those countries who’ve been able to respond aggressively to the crisis with aggressive expansion-via-devaluation are all doing pretty well. The bigger developed economies can’t do that exact thing, but they can mount more aggressive expansionary responses — they just aren’t.
All this is a convenient excuse for not bothering to grasp the differences between structural and cyclical unemployment. Joseph Lawler had an excellent in-depth discussion of this issue in the December-January issue of the American Spectator, which I summarized in March:
Boiling down a complex discussion to its essence, we must understand the difference between cyclical unemployment — a temporary situation caused by short-term downward trends in the business cycle — and structural unemployment, which is the result of fundamental changes in the economic structure of society.
If Yglesias is too lazy to wrap his mind around that issue, I can’t force him to do so, but I must point out that “structural” is not a synonym for “unfixable.” The problem is that the kinds of government interventions that help ease cyclical unemployment may actually hinder recovery when there are structural changes in the economy.
Are we looking at a temporary slow period in the business cycle or are we looking at the results of structural changes in the economy? The question is not moot, nor is it a matter of political preference. If the government is shoving unemployment benefits and public assistance at people, encouraging them to wait around for the jobs to come back when, in fact, those jobs aren’t ever coming back, then your policies are doing more harm than good.
Arguments about economics have an unfortunate way of becoming arguments about politics because there is always the question of what policies the government should pursue. Yet we cannot forget there is an underlying economic reality that is immune to our political wishes.
UPDATE: A liberal who actually knows something about economics weighs in:
The important point is that while it isn’t structural now, the longer high unemployment persists the more the amount of structural unemployment will increase. There are a couple of mechanisms for this, the most obvious one being that over time, the skills of unemployed workers deteriorate as technology/practices change. This mismatch between skills of the unemployed and the needs of employers grows.
Ah, but Duncan, how can you so blithely conclude that current unemployment is not structural?
The housing boom created jobs for a lot of unskilled and semi-skilled workers who are now unemployed and who, barring a re-inflation of the “bubble,” are unlikely to find such good employment prospects in the immediate future. Furthermore, these people are in many cases the same ones who signed on for those low-doc option-ARM mortgages and are now living in houses worth less than they owe on them. So they’re doubly screwed.
All of which goes back to a point I’ve been pounding home for months: You can’t make capitalism work without capital, and the biggest problem in the U.S. economy today is a capital shortage. The housing meltdown wiped out $7 trillion in asset value, and there is simply no way to recover quickly from that kind of wipeout. So when you keep pretending that recovery is just around the corner — it’s not — you’re undermining your own credibility.
Frankly, liberals were on more solid ground with their original argument: “Blame Bush!”
by Smitty
We had a preview of this at Smittypalooza on my Inspiron Mini. Cassone allowed that they were trying to figure out a name for this less-than-serious outfit. Deadly serious topic, though. Blotto was taken, so it looks like they settled on “Lenin and the Castros”.
This blog is a brace of shameless shills for Victoria Jackson and Chris Cassone. May Fortune favor their efforts.
by Smitty (via Insty)
Kansas City.com quotes Prof. Reynolds:
Everyone should pay at least some income tax. And everyone’s tax bill should go up or down whenever federal spending does.
KC.com then asks:
Is there a way to more closely align politicians’ incentives with the nation’s long-term financial interest? It’s a lot tougher than it sounds, because the incentives facing voters are perverse as well.
The problem is highlighted by a branch of economics called public choice theory, which analyzes the way people behave while making collective decisions, as opposed to how they behave in the marketplace.
I submit that the improved system, itself, isn’t all that tough. What will prove somewhere between challenging and impossible is the transition.
The title of this post is due to Daniel Webster in 1819. And what responsible person would disagree that, through taxation, the Federal government is destroying, or threatens to destroy, the country?
So take away DC’s power to tax directly.
Dan Riehl also weighed in:
I think there are at least two paths to consider, one broader and one more targeted. As McClanahan [KC.com] points out, things do happen somewhat differently within the states. Rather than only export that type of remedy up to the federal level, there needs to be a more honest discussion of state’s rights and the Tenth Amendment. Because progressives[?] are predominantly federalists, as soon as someone brings up the concept of state’s rights, it’s immediately tarred with the brush of the Civil War. That would have to abate if the country is going to be able to have a genuine discussion of state versus federal power and control, particularly as it impacts spending.
The other path includes a more informative approach to accounting for government spending. While it shouldn’t become so micro as to simply gloss over one’s eyes, we need to get away from simply discussing budgets as vast piles of money. If one is going to cut federal spending on Education for instance, it should be more clear what silo within the budget it’s targeted at. We don’t approach it that way today. As soon as one hears about cuts to education, the Left immediately paints a picture of poor children going without their school lunch, upon which more and more of them have come to depend. As an aside, that specific discussion would be better served at the state level.
It is hard to get one’s mind around, but I believe clearer cost accounting at the federal level and a more robust discussion of state versus federal government and their respective roles in our lives are at least two good paths to begin exploring.
I submit that Dan’s former approach is the horse to bet on; the latter will be as readily corrupted as the current arrangement.
The reason for the corruption is the lack of feeback. Irrespective of whom you vote into office, the Federal beast grows. What to do? Remit the sub-Federal duties that DC has piled upon itself to the States. Most importantly, that of collecting taxes.
At the risk of sounding slightly cranky, if the Tea Party isn’t pushing for this sort of reform and restoration, then the Left laughs. The Left understands that the Federal death grip on the country’s future is predicated upon the power of the purse. The Contract From America will evoke a titter from the Left because it amounts to a sexy shade of lipstick upon the Federal pig. Progressivism has perverted the Constitution, at a medium pace, for about a century now. If the power to tax remains in DC, then it shall all have been a fine collective temper tantrum, but it shall not have bought much in the end.
by Smitty
It’s been a good week for both the country and Rule 5.
United Nations hooks up to draft the world’s first comprehensive convention against terrorism. For the fourteenth time in ten years!
Just keep pluckin’ that chicken, UN.
Bonus Joe, asking the eternal question: “Why?”
The tear line of shame.
That’s your Rule 5 Sunday. Peace to all, and updates to Smitty.