SchansBlog

GOP and Dems struggle with Econ 101

2012-01-31T09:03:00.001-05:00

From Tom Davies in this AM's C-J on the impending "right-to-work" law in Indiana...

Sen. Brent Waltz, R-Greenwood, who was among nine Republican senators to vote against the bill last week, was the single “no” vote in the committee Monday. Waltz said he believes the proposal could cost the state jobs and won’t raise wages for Indiana workers...

Wow! Lower labor costs could reduce the quantity of labor demanded? OK...

Opponents say the law only leads to lower wages and poorer quality jobs.

When you hear someone say "only" about a change in a public policy, you know that they're dupes or demagogues. Will it lead to lower compensation for those within the cartel? Yes. Will it lead to any benefits? Yes, in fact, it will yield net benefits. (That said, I expect the benefits to be modest but not huge.) To note...

Many experts say states’ economies respond to a mix of factors, ranging from swings in the national economy to demographic trends, and that isolating the impact of right-to-work is nearly impossible.

more confusion on Romney and tax percentages paid

2012-01-25T11:58:00.000-05:00

I've blogged on this in some detail.

Here's an example from the AP's Stephen Braun (hat tip: C-J)...

How the details of Romney's extensive wealth will play among taxpayers, rival campaigns and the news media started to emerge Tuesday, as more than 500 pages from a 2010 tax return and a 2011 estimate spilled out both significant and minor revelations about Romney's scattered holdings, tax strategies and charitable donations.

--> First problem: why do we have a tax code where *anyone* needs hundreds of pages to file?

--> Second problem: a tax code with so many loopholes that hundreds of pages are in play? Flat tax, anyone? Anyone?

The returns outline both the dimensions of Romney's finances and the complexity of the tactics used to reduce his effective tax rate to less than the 15% paid by many middle-class Americans...Romney paid about $3 million in federal income taxes in 2010 on an income of $21.7 million, putting him among the wealthiest of American taxpayers. At the same time, Romney gave nearly $3 million to charity -- about half of that amount to the Mormon church -- which helped lower his effective tax rate to a modest 14%...

A big part of his lower rates is taxation on capital gains (lower than labor income, but based on income that's already been taxed once). The other consideration is that many people think marginal tax rates are the same as average tax rates, overestimating what wealthy and middle-class people usually pay in federal income taxes. (Contrary to Braun's assertion, few in the middle class pay anything close to 15%.)

Obama's SOTU and ignorance on economics and tax policy

2012-01-25T11:49:00.000-05:00

From the AP's Ben Feller in the C-J...

Declaring the American dream under siege, President Barack Obama delivered a populist challenge Tuesday night to shrink the gap between rich and poor, promising to tax the wealthy more and help jobless Americans get work and hang onto their homes.

--> President, you and Congress are the ones continuing to lay the siege!

--> Faux populist; more style than substance

--> He's been shrinking the wealth gap between "rich" and "poor". That's what recessions do!

--> More taxes on the wealthy. Not good for the economy, but if you're not going to cut spending...

--> Work and homes? How are you going to do that...really?

In a signature swipe at the nation’s growing income gap, Obama called for a new minimum tax rate of at least 30 percent on anyone making more than $1 million...“Now you can call this class warfare all you want,” Obama said, responding to a frequent criticism from the GOP presidential field. “But asking a billionaire to pay at least as much as his secretary in taxes? Most Americans would call that common sense.”...Obama calls this the “Buffett rule,” named for billionaire Warren Buffett, who has said it’s unfair that his secretary pays a higher tax rate than he does. Emphasizing the point, Buffett’s secretary, Debbie Bosanek, attended the address in first lady Michelle Obama’s box.

--> All billionaires pay far more, in dollar terms. Most billionaires pay far more, in percentage terms.

--> Those who do not are subject to lower capital gains tax rates (paying tax on money for a second time) or are taking advantage of loopholes. Any credible, "fair" approach to income taxation would eliminate loopholes. But most Democrats and many Republicans don't want that.

--> If you want to deal with taxes and the middle class, your first priority has to be payroll taxes-- 15.3% of eery dollar earned. Democrats should step up on this issue, but they're busy demagoguing Social Security, Medicare, and tax policy.

--> A lot of this is confusion between average and marginal tax rates.

Romney and Buffett's "tax rates" (vs. the little people)

2012-01-25T10:45:00.003-05:00

Romney and (supposedly) Buffett pay lower tax rates than common people?!

Variations of this story have been increasingly popular over the last few years. (Apparently, the President used this in the SOTU last night!) This isn't too surprising, given the economic doldrums inspired by the "Financial Crisis" and extended for more than four years now by the policies of Presidents Bush/Obama and their Congresses. Envy and resentment find more fertile ground in tougher times. (I wonder whether the politicians are dopes or are doing this on purpose, but that's another story.)

There are a variety of factors to consider-- differential taxes on capital gains vs. labor income; whether to include onerous payroll taxes on income in the calculations (but we usually ignore these, despite the pain inflicted on the lower-middle and middle classes, so why start now?); whether to include state and local taxes (more complicated and difficult to compare cases). In any case, the most common comparisons are simple (and simplistic), focusing on federal income taxes only.

Unfortunately, the comparisons often suffer from ignorance of the tax code and different expressions of "tax rate". Most notably, few people understand the difference between average tax rates (ATR) and marginal tax rates (MTR).

ATR is the proportion of one's income devoted to a tax or taxes in general. For example, if one has an income of $100K and pays federal income taxes of $12,000, then their ATR is 12%.

MTR is the proportion of tax paid on the last dollar earned. If one is in the 28% "tax bracket", then the last dollar earned is taxed at 28%. Each dollar earned is taxed in its respective tax bracket. Instead, most people believe that if you're in the 28% tax bracket, then every dollar earned is taxed at 28%. Not true! (The Tax Foundation does a really nice job with the big picture.)

For example, singles have a standard deduction of $5,800 and exempted income of $3,700. So, the first $9,500 earned is not exposed to any federal income taxes. (They've already lost about $1,400 to payroll taxes, but who cares about that?) If they earn $10,000, only the last $500 is exposed to the 10% MTR in the lowest tax bracket, resulting in taxes of $50 and an ATR of .5%.

In the Romney example popular on Facebook, Romney is said to have a tax rate of 13.9% while a teacher is said to have a 25% rate. Since there is no 13.9% tax bracket, the author must be referring to Romney's ATR. But if you do the calculations, a teacher who is single would need to earn at least $232,600 to have a 25% ATR (married with no children = $367,000; head of household with only one child = 314,700.) Why do I say "at least"? I'm assuming no itemized deductions, so our prospective teacher is a miser and doesn't have a mortgage on her home.

The irony of a valid comparison? The Occupy Wall Street crowd would say that she needs to be paying higher taxes!

Of course, teachers don't make this much money. So, those making such comparisons are invoking Romney's ATR and the teacher's MTR-- comparing apples and oranges, or better, apples and rocks.

the numbers on Romney vs. the teacher

2012-01-25T10:45:00.000-05:00

If you take the comparison literally, then the teacher must be making at least $232,600.

Instead, it's a faulty comparison is based on (purposeful?) confusion of marginal and average tax rates (MTR and ATR).

Using this tax table and looking at this year's 1040...

For a teacher who is single, a 25% ATR results from an income of at least $232,600.

-standard deduction of $5,800 and exempted income of $3,700 ($9,500 of income exempted)

-income of $232,600 results in taxable income of $223,100

-in the 33% tax bracket (MTR), resulting in a tax of $43,482.50 + 33% of the income over $178,650

-total tax of $58,151

For a teacher who is married (no kids), a 25% ATR results from an income of at least $367,000.

-standard deduction of $11,600 and exempted income of $7,400 ($19,000 of income exempted)

-income of $367,000 results in taxable income of $348,000

-in the 33% tax bracket (MTR), resulting in a tax of $48,665 + 33% of the income over $217,450

-total tax of $91,747

For head of household (with only one child), a 25% ATR results from an income of at least $314,700.

-standard deduction of $8,500 and exempted income of $7,400 ($15,900 of income exempted)

-income of $314,700 results in taxable income of $298,800

-in the 33% tax bracket (MTR), resulting in a tax of $46,430 + 33% of the income over $198,050

-total tax of $78,677

Why do I say "at least" $X in each of the three cases? I'm assuming no itemized deductions, so our prospective teacher is a miser and doesn't have a mortgage on her home.

The irony of a valid comparison? OWS would say that she needs to be paying much higher taxes!

Of course, teachers don't make this much money. So, those making such comparisons are invoking Romney's ATR and the teacher's MTR-- comparing apples and oranges, or better, apples and rocks.

my review of Entrepreneurship and Religion

2012-01-04T11:28:00.000-05:00

As it appeared in The Journal of Markets & Morality...

Entrepreneurship and Religion

Ed. Leo-Paul Dana

Cheltenham, UK: Edward Elgar, 2010 (442 pages)

Entrepreneurship and Religion is a volume of articles edited by Leo-Paul Dana. He dominates the work; aside from the editing, he had a hand in writing nine of its 22 papers. (No other author appears more than once—except for two articles he co-authored with Teresa Dana.) Nine of the articles had already appeared in seven academic journals, signaling quality and providing a single outlet for related work.

Some of the articles are historical; others are contemporary. They have an international range, including research about minority peoples within a dominant society. Some of the work is empirical; most of it is descriptive. The result is a fascinating set of articles that, nonetheless, has limited impact as an academic approach. The projects are so context-specific that it is difficult to confidently extend their applicability.

Then again, that is the nature of this field. It reminds me of “Industrial Organization” in economics—where one studies various market structures, such as competition and oligopoly. One of my friends in graduate school jokingly described the field as a “compendium of special cases”. Much of this work has the same feature.

One deficiency in the editing is that many of the essays cover similar ground in their introductions—as they provide the background literature and an overview of entrepreneurship. This is good if one reads the essays separately, but creates much redundancy if one reads the book as a whole. (Along these lines, Dana’s introductory essay is most effective and allows one to skim the other chapters more quickly.)

One of the book’s strengths is in modeling and describing entrepreneurs as more than mere individuals who are to some extent constrained or encouraged by a legal framework. Entrepreneurial efforts are also a product of cultural, social, and religious contexts.

But as Dana notes in his introduction, culture, religion and society are intertwined with ethnicity. As it turns out, this hinders the goal of the volume. Often, inferences in the essays about the impact of “religion” are spurious or stretched. Beyond that, some of the essays do not address religion at all. (The book’s title should have included a reference to ethnicity and culture.)

For example, in Anne White’s study of Methodism (chapter 7), the reader is left wondering whether the entrepreneurs are driven by being Methodist, Christian, or Canadian. In Dimitri Tassiopoulos’s study of Greeks (chapter 4), one cannot tell whether the cause is Greek ethnicity or adherence to Greek Orthodox religion.

When such distinctions can be made, the authors effectively detail how religious beliefs and doctrine can be a catalyst or deterrent for entrepreneurship; observe that religions are generally effective at promoting and propagating values; and note that religious communities often provide low-cost “networks” for labor, product, and information. Some religious contexts create religion-centered, demand-side opportunities. (See, for example, specially-prepared foods for Jews and Muslims—and Welch’s grape juice for Methodists.) And some religious entrepreneurship is indirect—as a supply-side response to religious and ethnic discrimination.

The volume features a number of strong essays on religion and entrepreneurship: the influence of the “Protestant work ethic” (Ivan Light in chapter 6); the impact of Islam in general (Wafica Ali Ghoul in chapter 12); categories of entrepreneurs within Islam (Nekka & Fayolle in chapter 14); Jewish middlemen in Alsace before World War II (Dana in chapter 17); Jewish entrepreneurs in Montreal (Morton Weinfeld in chapter 18); and a comparative analysis of the French and Dutch portions of the island of St. Martin (Baldacchino & Dana in chapter 20).

Three other essays are solid and warrant attention from those interested in the title of the book: Edwina Pio on Hinduism and caste (chapter 1); Dana on Jews in a variety of countries (chapter 3); and Heilbrunn & Asbeh on the Druze living in Israel (chapter 15)

I found three points especially interesting. First, Light notes that as markets become more competitive, discriminatory behavior becomes more costly. Beyond that, he focuses on the impact of Protestantism’s “universalism”—as opposed to the insularity of Catholic and Jewish communities. He argues that our contemporary distaste against discrimination and favoritism should be credited to Protestantism.

Second, how much discrimination and favoritism is “personal” (based on bias) as opposed to “statistical” (where discrimination in the face of highly imperfect information is the “best” decision)? For example, Light (177) notes that Puritans faced a dilemma in “doing business with dynamic but unknown Quakers, who might be dishonest, versus the security of doing business with mediocres of known probity.”

Third, in his study of Jewish middlemen in Alsace, Dana discusses the provocative idea that being an “entrepreneur” could be perceived as less risky than other alternatives—given one’s experience with being entrepeneurial!

This last observation leads to one of two suggestions in closing. How should we define “entrepreneur”? The literature seems to conflate entrepreneurship as a penchant for innovation along with someone who is hard-working. At one extreme, entrepreneurship simply becomes a synonym for any business venture, particularly if one is self-employed. To weigh one implication: the Amish avoid technology—and thus, to be successful, must work harder. Does this make them more or less entrepreneurial?

Finally, returning to the title of the book: More work should be done to distinguish “religion” as religious belief, rather than merely a blanket reference to a culture influenced indeterminately by religion. Maybe this point is difficult for researchers to recognize and embrace, because people routinely conflate these categories in everyday life. But in fact, they are quite different. As such, developing measures of religiosity would be a step forward in analyzing the impact of “religion” on behavior in general and entrepreneurship in particular.

science in theory vs. practice

2011-12-13T18:32:00.001-05:00

From Dave Coverley's Speed Bump...

From Ronald Bailey in Reason-- on whether Dems or GOP'ers are more anti-science...

Dems point to stem cells and global warming. But Dems are often opposed to animal testing and genetic engineering. And they're usually opposed to nuclear energy. The Dems also get votes for their support of abortion (which can't be solved by science, but if one relies on it, then abortions after a few weeks would be out-of-bounds).

Finally, "as law professor Dan Kahan and his colleagues at the Yale Cultural Cognition Project have shown, the strong urge to avoid scientific and technological risk is far more characteristic of people who have egalitarian and communitarian values, that is to say, left-leaning folks..."

Bret Stephens in the WSJ on Global Warming...

How do religions die? Generally they don't, which probably explains why there's so little literature on the subject...Consider the case of global warming, another system of doomsaying prophecy and faith in things unseen. As with religion, it is presided over by a caste of spectacularly unattractive people pretending to an obscure form of knowledge that promises to make the seas retreat and the winds abate. As with religion, it comes with an elaborate list of virtues, vices and indulgences. As with religion, its claims are often non-falsifiable, hence the convenience of the term "climate change" when thermometers don't oblige the expected trend lines. As with religion, it is harsh toward skeptics, heretics and other "deniers." And as with religion, it is susceptible to the earthly temptations of money, power, politics, arrogance and deceit...

Religions are sustained in the long run by the consolations of their teachings and the charisma of their leaders. With global warming, we have a religion whose leaders are prone to spasms of anger and whose followers are beginning to twitch with boredom. Perhaps that's another way religions die.

From Daniel Botkin in the WSJ...

One of the changes among scientists in this century is the increasing number who believe that one can have complete and certain knowledge...I felt nostalgic for those times when even the greatest scientific minds admitted limits to what they knew. And when they recognized well that the key to the scientific method is that it is a way of knowing in which you can never completely prove that something is absolutely true. Instead, the important idea about the method is that any statement, to be scientific, must be open to disproof, and a way of knowing how to disprove it exists.Therefore, "Period, end of story" is something a scientist can say—but it isn't science...How about a little agnosticism in our scientific assertions...

From Gautam Naik in the WSJ...

This is one of medicine’s dirty secrets: Most results, including those that appear in top-flight peer-reviewed journals, can’t be reproduced…There is also a more insidious and pervasive problem: a preference for positive results...

research on the impact of school choices on Christian children

2011-12-01T20:50:00.000-05:00

The Cardus report on the impact of Christian education choices-- or more precisely, the impact of the type of education chosen for children self-identifying Christians...

And as summarized in CT...

There are many interesting and some surprising results:

-Conservative Protestant schooling is more likely to result in church leadership and feel well-prepared for relationships, but least likely to like new and exciting experiences.

-Religious homeschoolers are most likely to feel prepared for a vibrant religious/spiritual life, but also to get divorced and to lack direction. (Sobering if true!)

-Those educated in Catholic schools earn the highest incomes, are most likely to make political contributions, and least likely to accept the authority of church leadership.

-Public schoolers are most likely to volunteer their time but least prepared for relationships.

And so on...Check it out.

This blog post seems to do a nice job in surveying some of the other relevant literature and wrestling with the validity of the Cardus report. The most interesting comments are about religious homeschoolers and trying to figure out whether the report is accurate with respect to homeschoolers.

three articles on education

2011-12-01T20:37:00.000-05:00

1.) the growth of homeschooling in the African-American community (Tiffany Owens in World)

2.) the growth of school choice programs across the nation (Sheryl Blunt in CT)

3.) new-and-improved research on educational levels and religious practice (Tim Dalrymple in World)

First, by many measures the more educated are more religiously observant. They are more likely to engage in worship and devotional activities, and to affirm the importance of religion in public life...The more educated, although they are no less likely to believe in God and the afterlife, are less likely to believe that the Bible is the literal Word of God, or that there is only one true religion. This suggests that the educational establishment is averse not to religiousness in general, but to particular forms of faith. Thus, as people grow more educated, they are more likely to switch to mainline denominations...Finally, different religious groups are affected by education differently. Evangelicals, for example, are especially likely to grow more devout and more observant with more education.

OJCPSB: Occupy JCPS Buses

2011-12-01T20:21:00.000-05:00

That seems to be the motto of the JCPS administration-- where putting kids on buses in the pursuit of racial diversity is really important. One can't say whether it's more important than the quality of the education provided, but it's obvious that it's important given the resources devoted to this goal-- both in what's extracted from taxpayers and what's imposed on parents and children.

Here's the primary article in the C-J (by Antoinette Kunz) preceding the start of school this Fall. It has some amazing statistics and factoids:

-"They desperately hope the many changes they've put into place will prevent the problems that kept some elementary students from getting home [during the first week last year]...400 children getting home after 6 p.m., with some still on buses as late as 9 p.m."

-"930 school buses will hit the road as early as 5 a.m. to transport approximately 66,000 of the district's 101,000 students."

-"Those buses will be equipped with new radios that have channels programmed exclusively to each bus compound, cutting down on communication confusion. The district spent $1.2 million on the radios earlier this year..."

-" a new JCPS bus hotline...so parents can get the information they need before sending their children to the bus stop Monday...manned by about 10 staff members..."

-"...also providing 200 additional staff members at the district's 20 elementary bus depots to help 'ensure the children get on and off the right buses'..."

-"at every elementary school, bus riders will have luggage tags attached to their backpacks, with labels that designate the child's name, bus number and bus stop.The luggage tags, which cost the district $16,000..."

-"...asking parents to be patient on the first day, but he said he hopes to have all the students back home by 6:30 p.m. Eventually, he said, all elementary students will be delivered home by 5:30 p.m..."

Wow!

Here are more data from the latest editorial from the C-J'ers on the "busing tango"-- a nice term, except that it's more like police chasing those who want to break regulations instead of "it takes two/partners to tango".

-"...elementary student bus runs over 75 minutes now have been eliminated for the first time. The percentage of students riding between 60 and 70 minutes has been cut by two thirds to 2.8 percent (a total of 832 students) since the 2008-09 school year, the last one before the current assignment plan. The average elementary ride time is 29.2 minutes."

Those numbers are amazing enough, but the editorialists seem excited by an *average* bus ride of 30 minutes each way.

JCPS is 16th in the country in terms of students transported daily, but 8th in miles driven. Among larger cities, Louisville is 3rd in terms of miles per bus (behind Chicago and Charlotte).

They're good at driving kids around on buses. If only they were half that good at educating them...

more-on Keynesian failures

2011-12-01T19:42:00.001-05:00

WaPo's Sarah Kliff in the C-J on the latest efforts to buy votes with our own money &/or efforts to "stimulate" the economy by robbing Peter to pay Paul...

The Obama administration will announce as much as $1 billion in funding today to hire, train and deploy health care workers, part of the White House’s broader “We Can’t Wait” agenda to bolster the economy after President Barack Obama’s jobs bill stalled in Congress...There will be an emphasis on speed, with new programs expected to be running within six months of funding...

Then again, the emphasis on speed is interesting, because fiscal policy is notoriously slow (in general) and President Obama has avoided "shovel-ready jobs" to pursue other agenda items. Here's the WSJ editorialists on an example:

President Obama used to be fond of "shovel-ready projects." He's also demanding that Congress pass his jobs bill immediately because 9% unemployment is a crisis, and, by the way, he's for making the U.S. less reliant on energy from tyrants. So how about putting 20,000 Americans to work on a North American energy project that's as shovel-ready as they come? Sorry...The $7 billion project is TransCanada's Keystone XL, a 1,700-mile underground pipeline that would deliver 830,000 barrels of heavy crude oil a day from Alberta to refineries in Oklahoma and Texas...He's president of the 1%.

Then, there are the broader discussions of Keynesianism's intellectual death 40 years ago and its more recent failures in the policy realm. Here's Tim Cavanaugh in Reason...

Nobel Laureate Paul Krugman, a prominent voice in favor of Keynesian economic intervention, argued that the 2009 stimulus failed because it was not large enough to close a gap in aggregate demand. But the most important goal of the stimulus was achieved almost a year ago: Consumer spending returned to its pre-recession level in the last quarter of 2010...

So why aren’t Krugman and other Keynesian interventionists cheering? John Maynard Keynes’ general theory teaches us that now should be Miller Time. According to the standard [Keynesian] macroeconomic model, you revive a stagnant economy by closing the gap in aggregate demand. Taking up the slack in demand is supposed to be the heavy lifting of an economic recovery, the part of the job so big only the government can do it...And yet the economy stays narcotized...

“There’s really nothing in Keynesian theory that encompasses indebtedness—consumer indebtedness and corporate indebtedness,” Higgs said in a phone interview....Higgs points out that while spending is back, investment remains low...Higgs and others hold that money is staying in the vaults because of regime uncertainty. The Patient Protection and Affordable Care Act, passed in 2010, has created a new panoply of expenses for anybody looking to hire an employee, but the full range and nature of those expenses can’t be measured even by a team of lawyers...

homeschooling books for sale

2011-11-19T16:11:00.000-05:00

Clearing out the basement. We homeschooled for three years and this is what we don't want (books, etc.) / didn't use (workbooks). Much like new; most of the rest in excellent shape. Mostly My Father's World, but some other stuff at the bottom.

My Father’s World
K (basic package): Teachers manual, alphabet flashcards, two copies of student worksheets (not first 7 weeks; retail $132; sell for $25)
1: Teachers manual and 5 books (retail $160; sell for $60)
2: Teachers manual and 5 books (retail $132; sell for $50)

3rd-8th Grade: My Father’s World—Exploring Countries and Cultures
Teachers manual and 9 books (retail $207; sell for $80)

4th-8th Grade: My Father’s World—Creation to the Greeks
Teachers manual and 12 books (retail $275; sell for $110)

Rod and Staff
English 3-6 (text and tests) and Spelling 2 (retail $66; sell for $25)

Miscellaneous
-Adam/Gordon's Spelling Power Ages 8-adult ($25)
-Serl's Primary and Intermediate Language books (more heavily used; $10 and $15)
-CLP's Exploring American History ($10)
-Mystery of History, Vol. 1 ($15)
-Writing Strands-- Level 3 ($5)
-3rd, 5th grade Scott-Foresman readers ($5)

the sad case of Jon Corzine and the difficulty in govt regulation of the market (in reality vs. wishful thinking)

2011-11-17T19:07:00.000-05:00

Speaking of "The Big Short" and my review of it, here's some of the amazing story of Jon Corzine-- former Democratic Senator and Governor from New Jersey-- and the fall of his investment firm, MF Global.

In the WSJ, Michael Rapoport describes how Corzine lobbied against greater regs, worked to hide the risks he had taken. All quite instructive-- and all quite connected to the dilemmas described in Lewis' book...

For the past two years, MF Global Holdings Ltd. may have disguised its debt levels to investors by temporarily slashing the debt it was carrying before publicly reporting its finances each quarter...ratings agencies defend their actions...The activity, referred to in the financial industry as "window dressing," suggests that the troubled financial firm was shouldering more risk and using more borrowed funds to facilitate its trading than investors could easily detect from the firm's regulatory filings...the firm's aggressive approach to the issue speaks to its strong appetite for risk, even as European markets spiraled lower this summer. But that appetite was not always completely apparent to investors...In each of the past seven quarters, from late 2009 to mid-2011, MF Global's quarter-end borrowings were an average 16% lower than the quarterly average...Window dressing isn't illegal, but it can mask a financial institution's true levels of borrowing and risk-taking. That is an issue of particular concern with MF Global, where borrowings fueled large trades on European sovereign debt that helped lead to the firm's demise...

MF Global...lobbied against a Commodity Futures Trading Commission proposal that would have placed tighter restrictions on how futures-trading firms can invest cash sitting in customer trading accounts. MF Global Chief Executive Jon Corzine in July participated in a conference call with CFTC officials and strongly opposed the restrictions, saying they would hurt business.

This WSJ editorial notes the absence of (an effective) regulatory presence, even after the subprime fiasco.

If reports of missing funds are true, it's a significant embarrassment for the firm's regulators at the Commodity Futures Trading Commission. CFTC Chairman Gary Gensler has been leading the Beltway chorus for years in reciting the (false) story that the absence of regulation allowed AIG and its credit-default swaps to wreak havoc in 2008.

Never mind that the Treasury Department's Office of Thrift Supervision did regulate AIG, and that an OTS official testified before Congress that the agency signed off on the swaps because it didn't expect Armageddon in the housing market. Mr. Gensler nonetheless succeeded in gaining for himself and his agency broad new powers over the derivatives market as part of Dodd-Frank in 2010...

It is also no small irony that MF Global was among the cheerleaders for Mr. Gensler's plans for new clearing arrangements under Dodd-Frank. Maybe if the regulators hadn't been so busy writing new rules, they would have checked if MF Global was following the old ones.

It was always fanciful to believe that the regulators who failed to prevent the last financial meltdown would somehow prevent the next one. The surprise is that this mirage of regulatory competence has been exposed so quickly.

Some takes on Corzine have been very rough. (See: Jon Stewart with a funny segment with the usual colorful language.) Others, like this from the AP's Angela Delli Santi, have been quite (overly?) respectful. This WSJ editorial notes that at least he lost, mostly, his own money (vs. taxpayers').

Finally, this Holman Jenkins WSJ op-ed revisits the Corzine political legacy in light of recent events.

The Big Short

2011-11-17T18:44:00.000-05:00

A friend loaned me Michael Lewis' The Big Short. Really good stuff-- as usual from (what I've read of) Lewis. As a popularized of history, his work is readable and seems accurate. He does a nice job painting portraits of characters and laying out institutional and historical detail. (The one big disappointment-- an omission-- is that Lewis did not address the role of "mark-to-market" regulations as a catalyst for the crash, or at least its timing.) Overall: an easy, good read.

The primary topics of the book are the burgeoning "subprime" home mortgage market (from $130B in 2000 to $625B in 2005), the subsequent market for investments connected to those mortgages (from $55B to $507B), and the failure of the market and govt regulating authorities.

A number of concepts are in play here, from economics and political economy:

1.) A "subprime" mortgage is not inherently troubling, as long as the underlying (greater) risks are correlated with higher rates of return. If those risks are not easily understood, then the market will struggle. If those risks are subsidized, then the govt is causing inefficiency and other troubles within markets. Both occurred here.

2.) Likewise, a subsequent market for mortgage-related investments is not inherently troubling, as long as the nature of the investments is understood and their risk is not subsidized. We see such financial markets arise to act as a form of insurance-- a "hedge" against various future outcomes. The problem in this market is that the investments were very complex AND the ratings agencies (in whom investors placed their faith) were a combination of inept and greedy. (Lewis noted that Warren Buffett had/has a 20% ownership stake in Moody's!) Moreover, the govt regulation of those agencies was insufficient-- whether more regulation was needed or whether existing regs should have been observed more closely. And govt policies proved subsequently to encourage the "moral hazard problem" through bailouts-- that failure would be bailed out will encourage more risky behavior.

3.) The key to the story is "imperfect information"-- in particular, information that was highly imperfect and worse yet, highly asymmetric. In the face of such information asymmetries, markets have some remedies and govt regulation can, at least in theory, provide a defense. Think of buying gasoline. How do you know how much gas you received? The little numbers say 9.3 gallons, but how do you know? The gas station has a reputation to uphold and some investigative journalism from a local TV station could bring down the company. But what sort of defense is this, really? Modest. The govt promises to help and hires inspectors to monitor this and affix stickers to the pumps, certifying their approval. But what does this promise? Do we faith in the sticker-placer and do we ignore the firm's post-sticker incentive to cheat and actually take advantage of our faith in the sticker?

In the case of investments, investors rely on credible/objective ratings agencies to step into this information breach. From Lewis' work, it seems clear that the agencies were mostly confused-- but in some cases, unwilling to pay the price for negative assessments of these instruments. Consider "house inspectors" as a parallel example. What makes for a "good" house inspector? Finding all the significant faults in the quality of a house, right? But that's only from the perspective of the buyer. From the perspective of the seller, a good inspector would turn a blind eye to less obvious faults. And more troubling, a realtor has similar incentives. What makes a good ratings agency? It depends on your perspective. And in this case, they failed to provide accurate, objective information.

Lewis argues that the ratings agencies failed, in terms of competence (vs. motives), given the complexity of investment vehicle, by mistaking diversity for lower risk. Often, diversity lowers overall risk by spreading risk. But in the case of the mortgage-based securities, there was a bundling of diverse, but still highly risky loans (within the subprime housing market). Moreover, the agencies and the market participants who guessed incorrectly failed because their statistical models, based on historical data, assumed housing prices that would increase forever.

All of this points to "market failure" (the academic term)-- or "market struggle" (to choose a more accurate term). But as always, market struggle must be contrasted with government failure/struggle. Will govt agents be able to regulate something they cannot understand either? The general public's reflex-- and for Congress as well-- is to seek more regulation. But as in many other cases, the record is that existing regs were not embraced to anything near their full extent. (Lewis discusses these failures in passing-- most notably on p. 166.) It is then an act of faith to believe that govt regs will improve things. Perhaps-- but perhaps not-- especially with the reality of interest group politics.

the difference/divorce between worker pay, worker compensation, and the cost of hiring workers

2011-11-03T12:27:00.000-04:00

A huge and oft-overlooked distinction: Workers, reasonably, focus on wage/salary. To a lesser extent-- and usually when forced to think about it once per year-- they look at compensation. And rarely do they look at what it takes to hire them. (And then there's the risk / rate-of-return calculation based on expectations of future productivity, costs, etc.-- all of which has had more variance injected into it by the policies of Bush, Obama and Congress.)

Excellent article in the WSJ...

Employees may not realize it, but they are getting more expensive.

It isn't that their paychecks have suddenly started bulging. It's that other employment costs—like health and retirement benefits—continue to rise. Benefit costs in the private sector were up 4% year-on-year in the second quarter, more than double the 1.7% increase in wages and salaries. On Friday, the Labor Department's employment-cost index for the third quarter is likely to show this trend continuing...

The trouble is, this means employers are paying more for workers without actually paying their workers more. Higher benefit costs eat into profits without directly raising a company's output in the way hiring more workers would. In fact, this can actually discourage hiring. And the more that companies have to spend on benefits, the less take-home pay goes to workers...

Americans, in fact, sense this already. "People are worried about income security to an unprecedented degree," says Moody's Analytics economist John Lonski. Indeed, the share of those expecting their income to fall remains higher than the share expecting income to rise over the next six months, as per the Conference Board's October confidence survey. This situation never occurred in the survey's 30-year history prior to 2008. Now, it has become the norm. Low wages at least could spur hiring. But if employees are getting more expensive for other reasons, the risk is nobody benefits.

three interesting articles on K-12 education and budget woes

2011-11-02T11:27:00.000-04:00

An interesting set of three articles in Sunday's C-J, with the same underlying issues/causes:

1.) Jenna Esarey's article on budget troubles in Clark Co., which are scheduled to lead to closing Maple Elementary...

2.) an AP article on reducing school bus services in Indiana, given budget woes...

The Franklin Township school district in suburban Indianapolis angered thousands of parents a few months ago when it contracted with a partner that’s now charging families what will amount to more than $400 per child this school year for bus service. And lean times could force other districts in similar straits to take a hard look at bus service.

Indiana’s attorney general is poised to issue an opinion on the legality of Franklin Township’s move. District Superintendent Walter Bourke said a decision against Franklin Township could force the district to eliminate transportation entirely. But he expects legislators next year to consider a law that would require school districts to transport students — a law he said could force struggling districts into bankruptcy if it passes.

Charging for transportation isn’t unique. Thousands of school districts across the country already do it...But it’s a new phenomenon in Indiana...

3.) WaPo's Lyndsey Layton with an article on four-day school weeks in 292 school districts in the U.S., to deal with tight budgets...

one signal that this is shaping up to be a “cliff year” in American education as the evaporation of federal stimulus funds and other fiscal troubles force many schools to make dramatic cuts. (Her next example involves cutting the "drama" club...nice turn of a phrase!)...

Four-day school weeks have been around since the 1930s and experienced revived interest during the oil crisis of the 1970s. But they had been used largely by a handful of rural districts in Western states, including New Mexico, where buses can burn plenty of gas traveling mountainous roads. Growing economic pressures have forced districts small and large across the country to consider the practice...

Because most states require a minimum of instructional hours, districts that drop a day lengthen the remaining four days so students don’t lose “seat time.” Research measuring the impact of a four-day school week on student achievement is scant. Educators in North Branch and elsewhere say there is no evidence that it has hurt learning...

Meet the (Birth)Parents

2011-11-01T11:07:00.000-04:00

My wife and I adopted two of our four sons, Z and J, in 1998 and 2003, respectively. (Back to our dating days, we decided that we wanted to adopt two and have two the more conventional way-- and the Lord honored that desire. We'll see about more in the future; stay tuned!)

Both adoptions were trans-racial and semi-open through a private agency, Childplace. We received good training through them and the state of Kentucky. We talked to adoptive parents; we listened to panel discussions; we read the literature; we got involved in a trans-racial adoption support group; and so on.

We didn't get to meet Z's birth-parents initially. I was at a conference, scheduled to hear Margaret Thatcher speak that evening (!), when the call came. They were willing to meet us that day, but despite me rushing home, they found it too difficult to hang around and meet us the next day. We did get to meet J's birthparents at the agency-- after she had given birth and he had been placed in the foster home, as we awaited the court's work to be done. That was an amazing experience!

Once we had our children, like most adoptive parents, we were leery to have direct contact with the birth-parents. (I think we were less leery than average, but still not fully at ease with it.) We wanted photos and cards/letters from them, through the agency. But meeting them, with our son, was somewhere between exciting, mysterious, worrisome, cool, and weird. If the occasion had arisen, we would have done it, but not without some fears and worries.

Once the boys got older, we started to realize that we didn't have anything (significant) to worry about. When your kid is X years old, it would scare the tar for him/her to think of living with people, who to him, are complete strangers. And we heard stories from friends who had open adoptions and glowed about the opportunity to meet the birth parents. We grew more and more interested in meeting with them.

Unfortunately, but understandably, we weren't getting much contact from the birth-parents through the agency. (I can't imagine how tough it would be, in their position.) We received a letter or two and some photos from J's birth-parents. But Z's birth-parents had a rough life and went underground (from the agency's perspective) when he was a year old. All of the letters and photos we had sent to them remained in a file at the agency.

Making things more challenging, it seemed likely to us that J's birth-father (and perhaps his birth-mother) would be willing to meet-- if we asked for that. But this would have been really tough on Z, who is about 4.5 years older and far-darker-skinned, and thus, has wrestled much more with adoption. So, we laid back-- waiting, hoping, and praying that Z's birth-parents would emerge.

In March 2010, the agency found Z's birth-mother on Facebook! The case worker asked whether she was interested in receiving the pictures and letters from the last decade. She said yes. Then, she wrote us! Very exciting-- for us and for Z. We would exchange letters every few months-- us writing soon after receiving her letters, and then her, after some weeks. We were angling to meet her, but it seemed like we were treading water. Finally, we pushed by giving specific dates-- and after another long wait, she agreed.

In the meantime, we had an exceedingly rough year with Z. His behavior at home was really difficult: punching holes in walls, intimidating my wife, scaring the other boys, and so on. It got to the point where I would not leave him alone with my wife and other kids. His grades were not good; he would occasionally refuse to go to school; and so on. It was UGLY!

So, here's the wild thing. When we finally met her in May 2011 at a McD's, Z was immediately and completely of a different heart. He apparently felt tremendous peace and resolution. Looking back, we hadn't caught that his gradually increasing agitation and behavioral problems seemed to stem from having contact with her, but not having yet met her. While he still had/has some bad habits to work through-- in terms of how to respond to frustration-- it was like night and day. Crazy!

After a second visit with her, we then moved to ask for a meeting with J's birth-father. In the same time period, he had found me on Facebook and we exchanged more messages and pictures. We met him with J-- again at a McD's-- and it was excellent.

So, what should adoptive parents take from our story:

-If you haven't already, continue to talk openly with your kids about adoption.

-If you haven't already, read some of the literature on adoption, the sense of loss and gain for the child, etc.

-Pray for wisdom and courage. Ask others to join you.

-Be open to meeting the birth-parents.Consider that your adoptive child will probably want to meet his/her birth-parents. Do you want to do that with him/her now, when they're a little older-- or do you want them to do it by themselves when they're 18-22? What signals does it send if you don't aim to do it if you can?

-Continue to persistently love your children-- no matter what they feel, what they claim to feel, what they say, what they do.

Post Office woes: What to do with a govt-run, monopolistic, delivery dinosaur?

2011-10-25T18:58:00.004-04:00

(A version of this later appeared in print.)

If you're a fan of evolution, the marketplace, or competition, the answer is obvious. If you don't like monopolies or corporate subsidies, the answer is obvious.

But if you're someone who benefits from the status quo, is a fan of big government or labor cartels, or has a limited policy imagination, then you're in an increasingly difficult position-- trying to prop up an expensive, unwieldy dinosaur. (Check out this identical editorial "written by" various postmasters-- which appeared in various newspapers around the country, including the Courier-Journal! LOL!)

As an economist, part of me loves bad policy, since it gives me great examples to use in the classroom. Take away the Keynesian stimulus efforts of Bush, Obama and Congress-- and Macro fiscal policy becomes mostly a theoretical and historical exercise. Take away our country's sugar policy and I have to find a new opening example of the need to think through the primary and secondary consequences of our choices.

Take away the Post Office, in its present form, and I lose a great opportunity to talk about the limited term "monopoly", the powerful concept of "degrees of monopoly power", the trade-offs inherent in "elasticity" (how much will quantity demand decrease with the rate raise in January to $.45?), and the ability of technology and market competition to erode even a monopoly established by government.

For years, it's been easy to predict that the Post Office would struggle more and more, as market participants erode its first-class mail monopoly at the margins-- and especially, as technological advance renders its services increasingly obsolete. One can even throw in some cultural/economic discussion-- such as the difference between generational use of the USPS and its continuing fade. It's great stuff for the classroom! (See also: Amtrak which has been subsidized for its entire existence, even when it sets records for ridership.)

Some of the more subtle details are hilarious and point to inefficiencies: The USPS doesn't own their own planes-- to do their own Express Mail. I'm told that it's common to take advantage of their "next-day guarantee", knowing that it's unlikely that they'll meet the commitment. So, you can get a package delivered quickly (in two days)-- for free. Labor costs for the USPS are 80-89% and 48-53% for UPS. (NY Times has the more modest numbers; Harpers has the more extreme numbers.) The USPS does not pay property taxes or vehicle registration fees. The recent proposal to reduce in mail processing services indicates that it was grossly inefficient for awhile or it can't be expected to do much to decrease costs.

In recent months, the Post Office has gotten a lot of attention, because its subsidies have grown, its future has become more obviously bleak, and likely, that we've reached some sort of threshold in terms of the public's perception of its tenuous future. Like many other government services (federal, state and local), the Great Recession has exacerbated this focus-- an interesting by-product of the Bush/Obama/Congressional bungling efforts with our economy.

In the absence of disbanding the Post Office or reducing its function to subsidized services for those in rural areas, we're just tweaking a bad institution. But that's probably the way things will go for another few years, since special interest groups-- corporate and labor-- have so much to lose. As such, assuming away dramatic reform, what should the USPS do?

Two things seem like no-brainers to me. "Reformers" are talking about dropping Saturday delivery, but that's just a tweak. Home delivery should be reduced to once or twice per week. If mail was delivered twice a week, you could reduce labor costs dramatically. And how often do you need to receive mail? For individuals who want more frequent delivery, they can pay additional for the service or get a P.O. Box. Business delivery would continue daily for a charge based on volume.

Among more significant reforms, we should no longer subsidize "junk mail"-- or any mail, except perhaps to rural areas (if voters want to continue those subsidies). Unfortunately for the USPS, this would significantly reduce the need for their services, in terms of quantity and especially weight/volume. Not surprisingly, although already about half of their volume, they want to deliver more of this type of mail.

Other options: outsource inefficient functions or focus more efforts on logistics; sell advertising on vehicles. (AEI will have a conference on November 4th, with Richard Geddes 2003 book as the foundation of the discussion. Click here to hear it on-line.) But all of this is rearranging packages on the shelves of a sinking ship.

The long-term will deliver a defunct or greatly diminished Post Office. What remains will be subsidized since it is inefficient. The question is whether its size and subsidy will be small or large.

Curtis Morrison ode to OWS and the Tea Party

2011-10-19T19:16:00.000-04:00

From Curtis Morrison in the C-J...

Currently, there are more than 1,500 uprisings taking place on our planet, all born from Occupy Wall Street, which began Sept. 17. Occupy Louisville, in Jefferson Square Park, is just one of those uprisings, but like all the others, people at home are struggling to understand its purpose. The uprisings, by their nature, are unprecedented. These are philosophical protests of how our democratic republic’s been working. Or actually, not working.

We/they don't understand "its purpose" because it's not well-defined and varies quite a bit by individual. In this way, it's like the dog's breakfast of Tea Partiers. And oh, it's quite precedented...

One really bad idea, unregulated capitalism, just hasn’t worked out for us.

One really bad myth gets repeated a lot. Unregulated capitalism? Crack is a bad idea too. I'd recommend throwing your pipe as far away as possible. This is as ridiculous as those who say a socialistic economy has been bad for us.

It’s been called a leaderless movement. And that’s true, although there are times I’ve wished Elizabeth Warren would just show up and take over.

Leaderless has its advantages. But they have had a handful of leader types show up, at least for face time. As for Ms. Warren, I'm not sure what she brings to the table, aside from some political charisma.

To many, this movement is an out-of-wedlock, unplanned pregnancy, and their alarm and concern are no surprise. Instead of browbeating this poor child, couldn’t we instead choose to nourish it, encourage it and provide it opportunities to create us a better world? Just a thought.

I wonder if he penned the same ode for the Tea Party. Just a thought.

income tax reform

2011-10-06T20:49:00.000-04:00

It's exciting to see President Obama propose the elimination of some loopholes. But it's frustrating that he won't propose getting rid of all of them, even all of those that disproportionately benefit the wealthy-- e.g., the HMID.

It's exciting to see people defend flat taxes-- e.g., the federal payroll tax on income and a variety of state income taxes such as Massachusetts. But it's frustrating to see people demagogue a flat "income tax" on income at the federal level or push so hard for multiple tax brackets. (In the WSJ recently, John Gordon provides a history of the income tax.)

Loopholes are tough, politically-- as is common, since the benefits go to a powerful special interest group while the costs are relatively subtle. The results are never efficient and rarely equitable. Politicians don't respond out of ignorance, because they're in the pocket of interest groups, don't want to reduce loopholes without reducing rates, etc. And the general public (as usual) pays little attention to arcane policy details. You'd hope that advocates for the poor would step up, but that's rare indeed.

One promising angle: eliminating loopholes to attack the deficit. For example, eliminating the HMID and the subsidy on health insurance through employers would raise more than $2 trillion over a decade.

A "flat tax" with exempted income results in a progressive tax structure. If $30K is exempted, then an income of $40K has only $10K of taxable income. Assuming a 20% tax rate, they would pay $2K or 5% of their income as an average tax rate. An income of $120K would have $90K exposed to taxation, resulting in $18K in taxes for a 6.7% average tax rate. And so on.

This also helps explain how the Bush tax cuts could have increased the progressivity of the federal income tax code. By reducing rates on the lower end, even a tax cut for the wealthy could increase progressivity on net. There's a lot of confusion about the "Bush tax cuts"-- even focusing on the non-Keynesian reduction in marginal tax rates. People often think the cuts only went to the wealthy-- and that's not (close to) the case.

In the WSJ, Stephen Moore runs with the ball:

"Suddenly, liberal Democrats are making the same argument about the tax code that I've been making for 20 years," laughs former Republican House Majority Leader Dick Armey. "Welcome to the party." Mr. Armey, who along with Steve Forbes has been the torch bearer for the flat tax since the early 1990s, believes that the latest applause line from President Obama that "billionaires should pay the same tax rate as janitors" may be the political gateway to sweeping tax reform...inadvertently helped as Mr. Obama and his new best friend, billionaire Warren Buffett, barnstorm the country trashing the tax system for, as the Oracle of Omaha puts it, "coddling the super rich." In truth, the system isn't nearly as skewed in favor of those at the top of the income pyramid as they allege: Today the top 1% pay 38% of the income tax. But in Washington, perception drives policy. The virtue of a flat tax with no deductions is that it provides an ironclad guarantee that the rich pay no lower a tax rate than janitors and secretaries.

This past summer the Senate Budget Committee, which is run by Democrats, reported that 26.5% of all tax deductions and credits are taken by those with incomes in the top 1% on the wealth scale...

Democrat Kent Conrad of North Dakota, the chairman of the Senate Budget Committee, says that loopholes are "subsidies, and subsidies are not the type of thing that you want for an efficient market system." He sounds like Milton Friedman there and he proposes to reduce "tax expenditures" by 17%. Why stop there? Republicans should counter-offer: We see your 17% and raise it to 100%...

The candidate who comes closest to a true flat tax is Herman Cain, the former Godfather's Pizza CEO. His argument for a "9-9-9" plan puts the current income and payroll taxes in the shredder and replaces them with a 9% personal income tax with no deductions, a 9% net business income tax, and a 9% national sales tax...

sheltering kids (too much?)

2011-10-06T19:56:00.000-04:00

Excerpts from a very long, but really good article from Reb Bradley (hat tip: Dave Carlsen)...

It's also available as a booklet, so that says something about its length. He does repeat himself at times, so you can get through it with some skimming, but it's the sort of thing that will require a chunk of time to read and you'll want some quiet so you can reflect on it.

His explicit audience is homeschoolers, but he's careful to broaden his net to "other family-minded people". More broadly, he's directly addressing a Christian audience, but many of the principles would hold for secular families too.

The intro is probably a bit hyperbolic-- and depending on your perspective, will sound somewhere between naive, weird, or sobering:

In the last couple of years, I have heard from multitudes of troubled homeschool parents around the country, a good many of whom were leaders. These parents have graduated their first batch of kids, only to discover that their children didn't turn out the way they thought they would. Many of these children were model homeschoolers while growing up, but sometime after their 18th birthday they began to reveal that they didn’t hold to their parents’ values...

As each of my three oldest children reached adulthood I was shocked to discover that they did not conform exactly to the values I had sought to give them. They had retained much of what I had given, but not everything...

God has opened our eyes to a number of critical blind spots common to homeschoolers and other family-minded people. Bev and I still stand behind what we have taught on parenting in the past. However, we urgently add to it the following insights...

From there, he lists seven "contributing factors":

1. Self-centered dreams

It is easy for conscientious parents to become “dream” oriented....our dreams, but they involve our children...not just for them, but also for us. [Especially] As homeschool parents we make great sacrifices and invest a great deal to influence how our children turn out. The problem is that love for children can be lost in love for personal success as a parent...

2. Family as an idol

...preoccupation with results can turn the family into a measurement of success...a badge of honor...determine our security or sense of well-being...idolatry...we look to our family for our significance when it has the most power to lift us up or to demoralize us. It is most obvious in a public setting when we either glory in our children or become enraged when they embarrass us. Our children are either the source of our pride or our disappointment.

...as my own children aged and I discovered that they were self-determining individuals with their own walks with Christ, I came to the alarming realization that I had a lot of control over their outside, but not their inside...[But] Consider the parable of the Prodigal Son – the righteous father raised two sons who turned out sinful...

3. Emphasis on outward form

Parents are destined for disappointment when they admire fruit in others and seek to emulate merely that expression of fruit in their own children...

4. Tendency to judge

...becomes easy to judge others by our personal standards...proud of our accomplishments...if we make preeminent for our families issues of outward appearance, we will likely condescend to those who don’t hold to our standards...Typically, when we belittle others who don’t measure up to our standards, we will also imagine others are judging us. Consequently, we will find ourselves frequently being defensive...

5. Over-dependence on authority and control

If we think we have total control over how our children respond to our training, we will relate to them not so much as people, but more as soulless animals...parents who want to influence their children during the teen years must not rely strictly upon their authority to keep their children obedient...Winning their hearts means gaining the opportunity to influence who they are, not just what they do.

7. Formulaic parenting breaks down relationship

1. The more we focus on formulas and principles, the more children become "things."

2. The more they become things the less we have significant relationship.

3. The less we have relationship the more we lose their hearts.

4. Without their hearts the less we are able to influence their values.

5. Without their hearts, the best we can do is control the outside (for a while)...

If Christians can consistently achieve seemingly spiritual results by human efforts, I ask – where is God in the equation?...

You may have noticed that I skipped #6, because it's his biggest point (one-third of the essay)-- which is noteworthy in itself. Here's what he says there:

6. Over-reliance upon sheltering

An over-dependence on control in a family is often accompanied by an over-reliance on sheltering of children...Protecting our children is not only a natural response of paternal love, but fulfills the commands of God...but it is possible to become imbalanced and rely too heavily upon sheltering. We do this in a couple of ways.

1. ...more concerned with protecting our kids from that which is bad or with putting into them that which is good?...we must give them that which strengthens them spiritually and morally...I protected my oldest children from harm more than I invested into them health. I certainly taught my children a great deal about God and Kingdom living – we saturated them with the Word and Kingdom stories. Their lives were full of outreach and ministry, but comparatively, I was most intense about sheltering...what thing Dad would declare off-limits next...When protection from the world becomes the defining characteristic of Christianity, we shouldn’t be surprised if our kids grow up and forsake the lifeless “religion of avoidance” they learned from us...

2. Sheltering is a critical part of parenting, but if parents keep it their primary focus, the children will grow up ill equipped to handle the temptations in the world...sheltering does not transform the human heart...Growing up isolated from temptation can develop a child who appears spiritually strong, but the appearance is not reality...

a. Take time to teach them about God and living in His kingdom. I emphasize this particularly for dads who are careful to shelter, but rarely get around to actually instructing their children in the faith...

b. Pass on a pure faith...

c. Expose them to the world a little at a time, so that they will not be overwhelmed by its attraction when they finally face it. Just as babies raised in germ-free environments more easily contract diseases, so also do Christians who have not encountered the world...

d. Take them into the world on the offense, not defense...I want to be with my children when they encounter the world, but not merely so that they will survive it. Survival has to do with self-preservation, and is concerned with self, not others. Like a good captain I want to be with my children, so that I can lead them offensively into battle...

A major problem for us may be that we do not have what we need to give. We lack a kingdom view, so cannot give it to our kids. The sheltering mindset common to homeschoolers sometimes creates inward-focused families...God’s goal for us is not that we raise strong family-minded children who grow up and meet other strong family-minded children, who then marry and raise more strong family-minded children, who grow up and do the same. That line of thinking is totally self-centered and renders God’s people impotent as warriors for His kingdom. God’s goal for all His warriors is to continually reach out to the lost in the world. That is why we are here.

e. Cultivate a loving relationship with them...

f. Help them find security in their relationship with you...

I believe that a primary reason we can over-rely on sheltering is because it is the easiest part of parenting to do. It requires no planning, little preparation, or expenditure of energy...an aspect of parenting that is effortless to do, yet seems to promise an extreme impact. I don’t know if I would go so far as to call it lazy parenting, but I will say that investing into our children does take a lot more work and much more time.

On point #4, there's a fine line between pressuring children in a public context and explaining the higher expectations of being in public and instructing/practicing with them what that will look like.

Big points:

-Don't invest in your kids to the point of idolatry. Part of this is the middle-class American dream and its relation to Christianity and secular families as well.

-The way I've said this for years: I think I can, mostly, get my kids to behave themselves until they're 18. But that's not my goal. How to accomplish that? Good question, with good but not utopian answers in prayer, godly counsel, candid and transparent living, teaching/mentoring vs. commanding, and so on.

-You can easily raise kids who end up falling on either side of the Parable of the Prodigal Son.

-If you find yourself judging others and being defensive, consider that a sobering barometer.

-If you think of parenting as a formula-- within your own family or for others-- take care.

-Is protection from the World the defining characteristic of your approach to parenting? Is avoidance the defining characteristic of your approach to Christian living?

-Do you have a Biblical worldview-- or just a semblance of polite middle-class morality? Do you have more focus on what you don't do-- or what you do?

-Why do many Christian kids "leave" the faith when they go to college? Evil college professors (not me, of course) are a convenient scapegoat. In most cases, we haven't prepared them properly. They are not thoroughly equipped for the task and the life change and the freedom.

Dionne vs. Logic; Buffett vs. Clinton

2011-09-30T11:50:00.000-04:00

From the WaPo's E.J. Dionne in the C-J this AM...

Maybe only a really, really rich guy can credibly make the case for why the wealthy should be asked to pay more in taxes. You can’t accuse a big capitalist of “class warfare.” That’s why the right wing despises Warren Buffett and is trying so hard to shut him up.

Seems like a weird way to set up policy. Does it follow, then, that only poor people can credibly make the case for educational choice? Maybe that’s why the left wing despises the poor and ignores them to focus on more-favored interest groups.

Buffett has outraged conservatives by saying that he pays taxes at a lower rate than his secretary...Thus did The Wall Street Journal editorial page call on Buffett to “let everyone else in on his secrets of tax avoidance by releasing his tax returns.”

Because it's probably not true. Or if it's true, it's because he takes advantage of crazy loopholes or his secretary is very well-paid and/or single. If the former, the answer is to get rid of the loopholes, not to increase tax rates. Why is this complicated to understand? Or he's comparing income from capital gains (why tax it a second time? what does Dionne have against Bill Clinton who lowered the rates?) to income earned from labor-- as Dionne continues on...

Buffett’s sin is that he spoke a truth that conservatives want to keep covered up: Taxing capital gains at 15 percent means that people who make their money from investments pay taxes at a much lower marginal rate than those who earn more than $34,500 a year from their labor. That’s when the income tax rate goes up to 25 percent...

Dionne is confused or conflating here, talking about marginal vs. average tax rates, and perhaps talking about taxable income instead of income &/or referring to singles.

No wonder partisans of low taxes on wealthy investors hate Warren Buffett. He has forced a national conversation on 1) the bias of the tax system against labor; 2) the fact that in comparison with middle- or upper-middle class people, the really wealthy pay a remarkably low percentage of their income in taxes; and 3) the deeply regressive nature of the payroll tax.

LOL! It's 1.) a bias against doubling taxation on the same earned income; 2.) "remarkably low"? by what objective or even subjective standard?; 3.) proportionate to the cap and regressive beyond that.

Of course, the hilarious part of his last point is that most "liberals" and virtually no Democratic politicians want to talk about the egregious payroll tax. It'd be nice to see Dionne banging harder on his friends on this! Hey, I know the GOP'ers don't care much about the working poor, but you'd think Dionne would say something to those who should lead the charge. Apparently, he's just a partisan hack.

Then Dionne repeats the Edwards gambit (apparently, lefties think this is a useful if not logical line of argument):

We are all lucky to have been born in — or, for immigrants, been admitted to — a country where the rule of law is strong, where property is safe, where a vast infrastructure has been built over generations, where our colleges and universities are the envy of the world, and where government protects our liberties. Wealthy people, by definition, have done better out of this system than other people have. They ought to be willing to join Buffett and Edwards in arguing that for this reason alone, it is common sense, not class jealousy, to ask the most fortunate to pay taxes at higher tax rates than other people do.

Bro, they do-- and if they don't, then we should get rid of the loopholes. All in favor?

"a warm but not boisterous reception" for Obama and his latest "stimulus"....err, "jobs pitch"

2011-09-28T09:45:00.000-04:00

From the AP (hat tip: C-J)...

President Barack Obama brought his jobs pitch to Colorado Tuesday, getting a warm but not boisterous reception in the city where he signed into law the sweeping stimulus plan more than two years ago.

At least the reception wasn't boisterous, but I'm surprised it was even warm. Maybe they just feel sorry for him and don't want to hold bad policy against him. And I love that adjective "sweeping" here.

Obama won cheers when he argued the money in the new measure would save teachers' jobs and put others back to work.

Why do Obama and those cheering focus only on the benefits of government activism? Is it cynicism or ignorance from Obama? Is it ignorance or idolatry for those in the crowd?

The president went on, "They need action. They need it now."

President, the economy would be a lot better off with less of this sort of action-- and continuing to bang the economy's head on the same wall over and over again.

Democratic Gov. John Hickenlooper attended the speech and said beforehand that the president has work to do here because of the lagging economy. "He didn't cause (the recession), but he's getting blamed for it," Hickenlooper said.

Governor, the President and his Congress have indeed caused the length of this recession. Own it, bro! And I'll bet Hickenlooper will be an interloper when it comes time to try to take credit for an eventual recovery.

"uncharitable" things to say about Rick Perry's charitable contributions?

2011-09-27T18:52:00.000-04:00

In Jacob Sullum's article in Reason about the 10th Amendment and presidential politics, he opens with this:

Evidently Rick Perry is a Christian. But does he have to make such a big deal out of it?"

Sullum says he's not that bothered by his faith, but is more concerned with what he sees as his flip-flopping on the 10th Amendment. But Christians should be concerned, especially if they're in danger of being played by another politician.

Here's Marvin Olasky in World on Perry:

After living in Austin for two decades I know many Perry political allies, critics, and former staffers. They've helped me to develop a preliminary Perry SWOT analysis—strengths, weaknesses, opportunities, threats...

In the eyes of conservatives, Perry's strengths are many...deep convictions and is willing to take heat for them...politically shrewd...strongly committed to free enterprise and free trade...solidly conservative judicial appointments...for border protection but is also attuned to Hispanics...backed a school voucher bill...[and a variety of restrictions on abortion]...

Perry, 61, has been married for 29 years to his childhood sweetheart, Anita...Perry for years attended the mainline Tarrytown United Methodist Church but now goes to Lake Hills, an evangelical megachurch. A half-dozen years ago he became more publicly evangelical. Only God knows whether the change is primarily theological or political...

Along the same lines as Olasky's questions about his faith-- and far more disconcerting, here's Emily Belz in World on Perry's contributions to church and charity-- one more area where he is uncomfortably close to Al Gore and many other "compassionate" Democratic politicians.

...despite his public commitment to his faith, Perry has given a pittance of his income to Christian organizations. Since 2000, Perry and his wife Anita have donated to churches $12,668—or 0.47 percent of their income—according to their personal tax returns. They have not donated personal income to any other Christian nonprofits...In 2007, when he reported income of over $1 million, he gave $90 to his church.

In total, his charitable giving is a bit better: He and his wife have given 3.3 percent of their income over the last decade...the most money to the Texas Governor's Mansion Restoration Fund, and the second most to the Texas Association Against Sexual Assault, an organization where his wife is a consultant.

The only candidate other than Perry to publish his personal tax returns is President Barack Obama. Obama has slowly edged up his giving, from under 1 percent of his income in 2000, to 1.4 percent in 2003, then up to 6 percent in 2006, and peaking at 13.6 percent last year...

One could say uncharitable things about Perry's charitable contributions. At minimum, it seems clear that, at least in this one area of his life, he is not a disciple of Jesus who is comfortable in the goodness of God's kingdom.

five myths about Mormonism?

2011-09-27T18:28:00.003-04:00

From Joanna Brooks in the WaPo (hat tip: C-J)...

The given catalyst for the essay is the presidential candidacies of Romney and Huntsman-- along with the Broadway musical, "The Book of Mormon"-- and a desire to correct / moderate caricatures of the faith. Her format is to address five "myths". (Church members usually prefer Church of Latter-Day Saints, but she uses Mormon and it's easier, so I'll follow her lead.)

1. Mormons practice polygamy.

Mainstream Mormons do not practice polygamy today, but it remains part of our history and theology...In 1890...yielded to political pressure and phased out the practice...Polygamy remains a source of tension for mainstream Mormons. Mormon public figures routinely play down our polygamous history...But the LDS Church, which teaches that marriages — or “sealings” — performed in its temples are eternal, has never disavowed elements of Mormon theology...

This is handled with considerable finesse by knowledgeable Mormons. But it is always challenging to argue for changing dispensations on theological matters of primary importance.

2. Mormons aren’t Christians.

Church of Jesus Christ of Latter-day Saints around the world prayed in the name of Jesus Christ, received a bread-and-water sacrament memorializing the body and blood of Christ, and discussed Christ’s teachings in Sunday school. We Mormons view ourselves as Christians. Many Christian pastors and scholars, however, point to theological technicalities that disqualify us from the mainline tradition. Some evangelicals do not see us as Christians for reasons rooted in antiquated anti-Mormon prejudice. And Mormons distance ourselves from other Christians by claiming that our faith offers a “restoration” of doctrines lost to mainstream Christendom...

Let's handle these one at a time:
-It's interesting that the sacrament is water and bread, instead of wine (or grape juice) and bread. To the extent that Mormonism has a tendency toward works-righteousness, the picture of a "watered-down" sacrament is apropos.
-Discussing the teachings of Jesus is nice-- especially if you cover all of them-- but not a clear indication of a saving faith.
-Whether or not Mormons are routinely saved by faith in God's grace as manifested by the atoning death of Jesus, it is odd (and dishonest?) to describe the doctrinal differences as mere technicalities.
-I agree that some Evangelicals oppose Mormonism out of prejudice and ignorance. Even so, there are good reasons to ask some tough/difficult questions about Mormon doctrine, history, Scriptural revelation, etc.

-The last point is huge: If you claim to be "the only ones" or claim to have a special and important revelation, then you can't complain when you're seen as unorthodox or cult-like! (See also: Catholics and Church of Christ.)

I don't see anything particularly large and controversial about the last three:

3. Most Mormons are white, English-speaking conservatives.

4. Mormon women are second-class citizens.

5. A Mormon president would blur the line between church and state.

Mormons have held local, state and federal offices in America for more than a century. Fifteen Mormons now serve in Congress, including Senate Majority Leader Harry Reid (D-Nev.) — and few seemed to worry that the LDS Church was influencing his debt-ceiling proposals.

just another drug warrior

2011-09-27T18:11:00.000-04:00

From Jacob Sullum in Reason-- with an article entitled "Bummer: Barack Obama turns out to be just another drug warrior"...

Sullum opens with Obama's (hopeful) public/political/personal history on the topic...

It is not hard to see how critics of the war on drugs got the impression that Barack Obama was sympathetic to their cause. Throughout his public life as an author, law professor, and politician, Obama has said and done things that suggested he was not a run-of-the-mill drug warrior. In his 1995 memoir Dreams From My Father, the future president talked candidly about his own youthful drug use, in sharp contrast with the Democrat who then occupied the White House and the Republican who succeeded him. As an Illinois state senator in 2001, he criticized excessively harsh drug sentences and sponsored a bill that allowed nonviolent, low-level offenders to enter court-supervised treatment instead of going to jail, saying “we can’t continue to incarcerate ourselves out of the drug crisis.”

As a candidate for the U.S. Senate in 2004, Obama called the war on drugs “an utter failure” and advocated marijuana decriminalization. As a U.S. senator, he cosponsored legislation aimed at reducing the federal government’s draconian crack cocaine sentences. Unlike Bill Clinton, who notoriously admitted smoking pot while claiming he “didn’t inhale,” Sen. Obama forthrightly told a 2006 meeting of magazine editors, “When I was a kid, I inhaled, frequently. That was the point.”

Obama stood apart from hard-line prohibitionists even when he began running for president. In 2007 and 2008, he bemoaned America’s high incarceration rate, warned that the racially disproportionate impact of drug prohibition undermines legal equality, advocated a “public health” approach to drugs emphasizing treatment and training instead of prison, repeatedly indicated that he would take a more tolerant position regarding medical marijuana than George W. Bush, and criticized the Bush administration for twisting science to support policy—a tendency that is nowhere more blatant than in the government’s arbitrary distinctions among psychoactive substances....

But...

It would be going too far to say that Obama has been faking it all these years, that he does not really care about the injustices perpetrated in the name of protecting Americans from the drugs they want. But he clearly does not care enough to change the course of the life-wrecking, havoc-wreaking war on drugs...just as he has disappointed those who expected him to end the wars in Iraq and Afghanistan.

That's the thesis. From there, Sullum lays out support for his claim-- for example...

[Obama] staunchly defended the Edward Byrne Memorial State and Local Law Enforcement Assistance Grant Program, which has fueled the incarceration of nonviolent drug offenders and funded the regional task forces behind racially tinged law enforcement scandals in places such as Tulia, Texas. As New York Times columnist Charles Blow noted last year, this grant program, created at the end of the Reagan administration, “has become the pet project of Democrats” because it’s “an easy and relatively cheap way for them to buy a tough-on-crime badge while simultaneously pleasing police unions.”...

Even on an issue that seemed to genuinely trouble him—the sentencing rules for crack cocaine, which treated the smoked form of the drug as if it were 100 times worse than the snorted form—Obama seemed less than fully committed...the Obama administration, to its credit, did support crack sentencing reform, although it’s debatable how much political capital it spent in the process...

[Obama] has not used his unilateral, absolute, and constitutionally unambiguous clemency power to shorten a single sentence, even though he has not otherwise been reticent about pushing his executive authority to the limit (and beyond). Obama went almost two years, longer than every president except George Washington and George W. Bush, before approving any clemency petitions. So far all 17 of his clemency actions have been pardons for long-ago crimes, most which did not even result in prison sentences...

Obama’s advocacy of a “public health” approach to drugs based on science uncorrupted by politics has amounted to even less in practice...

Campaigning in New Hampshire during the summer of 2007, he said raiding patients who use marijuana as a medicine “makes no sense”...Yet the DEA’s raids continued. If anything, the pace picked up...

At the end of the day, on this issue and many others, most people (and all partisans) on the Left are as emasculated as those on the Right. It's sad and funny to watch them work through the denial stage and withdrawal symptoms of their political addictions.

the limited wisdom of Elizabeth Warren

2011-09-26T18:14:00.000-04:00

On Saturday, the C-J pointed to this quote from Elizabeth Warren, Democratic candidate for U.S. Senator in Massachusetts, who "gives all Americans a civics lesson about taxes and democracy in this segment of a recent talk":

"There is nobody in this country who got rich on his own. Nobody. You built a factory out there — good for you. But I want to be clear. You moved your goods to market on the roads the rest of us paid for. You hired workers the rest of us paid to educate. You were safe in your factory because of police forces and fire forces that the rest of us paid for. You didn't have to worry that marauding bands would come and seize everything at your factory...Now look. You built a factory and it turned into something terrific or a great idea — God bless! Keep a big hunk of it. But part of the underlying social contract is you take a hunk of that and pay forward for the next kid who comes along.”

True enough--as far as it goes.

One should note that the targets of her comments paid for these things as well-- and probably a significant share. Why should we begrudge them for using the resources for which they have paid, along with others.

The bigger point: This tells us NOTHING about the extent to which the successful should pay taxes. And it takes us nowhere in terms of making the case for increasing marginal tax rates as income rises. That she thinks it does-- and that others have applauded her-- reveals the paucity of their thought processes, the cynicism of their political calculus, or the envy in their hearts.

bringing a spoon to a gun fight

2011-09-21T13:50:00.000-04:00

Sorry to use a metaphor of force/violence, but it's so popular that I hope you'll take it figuratively.

a.) It's kinda funny when someone brings a spoon to a knife fight.

b.) It's funnier when someone brings the same knife to a gun fight, thinking they're in good shape.

c.) It's cool when someone learns that they only have a spoon or a knife and grows from the experience.

d.) It's toward the peak of pathos when someone thinks that their spoon or knife is sufficient for the task and can't learn from the experience.

Sometimes I have a spoon; others times, a knife or gun.

Lord, please keep from overestimating what I know and help me to properly use what I have.

the efficiency of Medicare vs. private insurance

2011-09-21T09:15:00.001-04:00

Some back-and-forth recently on the Health Affairs blog about the efficiency of Medicare vs. private insurance:

Goodman and Saving last month August

followed by

Archer yesterday

Archer talks past Goodman and finds more studies which ignore the points he's making. And of course, she fails to note that private insurance is made far less efficient by all sorts of government intrusion in the market-- most notably, the vast subsidies to purchase health insurance, but also mandates on insurers/insurees and restrictions in competition between insurers.So, we're comparing a private insurance market, bound and beaten by the govt, to whatever the govt does. Not exactly a fair fight, if one is trying to compare "markets" to govt provision.

I'm not sure whether Goodman will find it worthwhile to respond to this. Stay tuned...

Highlights from Goodman and Saving:

...most seniors would like to keep Medicare just like it is. A similar view is held by a small, but vocal group on the left that favors single-payer national health insurance. The Physicians for a National Health Program, for example, claims that Medicare has lower administrative costs than private insurance and is able to use its monopsony (single-buyer) power to suppress provider fees...

Paul Krugman, writing in The New York Times, also argues this way. He points to a chart (see Figure I) which seems to show that Medicare per capita spending is growing at a slower rate than private insurance. Krugman, along with others, touts the slower rate growth in the Canadian health care system...

Let’s begin with a fundamental point that almost everyone tends to ignore. Medicare is not actually managed by the federal government. In most places it is managed by private contractors, including such entities as Cigna and Blue Cross...

What about the claim that Medicare’s administrative costs are only 2%, compared to 10-15% for private insurers? The problem with this comparison is that it includes the cost of marketing and selling insurance as well as the costs of collecting premiums on the private side, but ignores the cost of collecting taxes on the public side. It also ignores the substantial administrative cost that Medicare shifts to the providers of care.

Studies by Milliman and others show that when all costs are included, Medicare costs more, not less, to administer. Further, raw numbers show that, using Medicare’s own accounting, its administrative expenses per enrollee are higher than private insurance. They are lower only when expressed as a percentage – but that may be because the average medical expense for a senior is so much higher than the expense for non-seniors...

Ironically, many observers think Medicare spends too little on administration, which is one reason for an estimated Medicare fraud loss of one out of every ten dollars of Medicare benefits paid. Private insurers devote more resources to fraud prevention and find it profitable to do so.

The Argument Based On Government Single-Buyer Market Power: Five Problems

Health care markets are local. First, we don’t buy health care in a national market. We buy locally. And in local markets, private entities are often as big, or bigger, than Medicare (the auto companies in Detroit, for example, or the mine workers and their employers in West Virginia). There is nothing the US government can do that a lot of private companies and unions cannot also do...nothing is stopping the auto companies and the UAW from creating a global budget and rationing care for auto workers just the way the Canadians do it. That they choose not to do so is telling.

Side effects of suppressing provider fees. Second, there are negative consequences from unduly suppressing provider fees. Doctors can leave...The effects of price controls in health care will be similar to their effects in other markets.

Cost-shifting. Third, the suppression of provider payments shifts costs from patients and taxpayers to providers. Shifting costs, however, is not the same thing as controlling costs...

Political pressures and lobbying. Fourth, the argument overlooks the fact that public insurance in a democracy is ultimately subject to pressures at the ballot box....

A Modest Proposal for Changing Higher Education

2011-09-20T11:13:00.004-04:00

In this Great Recession, it is sad to travel through this great country and see the ranks of the unemployed crowded with so many youth. I think we can all agree that this is deplorable—and that we should endeavor to find an equitable and efficient method for improving the lives of our young people.

So, I have a proposal: Tuition and books at a public university should be free to all students. Students would attend the public university closest to their home. This would be financed by some combination of local, state and federal taxpayer dollars. And it would be regulated by a similar combination of local, state, and federal oversight-- university boards, parent-professor associations, state legislators, and a new federal program, "No College-Student Left Behind" (NCLB).

Those who want to attend a private university would still have that option. They would pay taxes to support the public universities and then pay private school expenses on top of that. A wide variety of private schools—some religious, but mostly secular—would be available to satisfy the demand for various niches in the market for higher education services.

All government loans and grants would be eliminated, since there would no longer be a financial barrier to obtaining a college education. Students could still borrow money from family, friends, or banks to pay for education at a private university—or more affordable online degree courses.

Think about the benefits: First, in the short-term, it would reduce unemployment among the young people (and others) by engaging them in another productive endeavor.

Second, education—a wonderful thing—would be freely accessible to all. In the long-term, at the micro level, we would expect an increase in worker skills, leading to higher pay. At the macro level, we would expect an increase in human capital and technological advance, leading to more economic growth.

Third, jobs would be created throughout higher education—from administrators to professors to staff. Construction at universities would boom, creating an untold number of jobs in the building trades. Publishers would sell more books; office furniture makers would sell more desks; computer makers would sell more laptops; and so on.

Of course, one can imagine some of the complaints that would arise.

Private schools would vociferously oppose what they would describe as "unfair" competition, having to operate alongside highly-subsidized public schools. But the market they serve is fundamentally different and one might argue that their preferences should not be allowed to supersede the greater, public good.

Some taxpayers might complain about higher taxes. But how many would notice the difference? With the costs spread over multiple levels of government and across many taxpayers, the per-tax, per-person costs would be modest. In any case, what’s the big deal about those in the middle and upper classes paying additional taxes?

Bureaucrats connected to government grants and loans might lose their jobs. But more bureaucrats would be needed to regulate the growing public sector efforts in higher education. And those displaced from loans and grants could probably be shuffled to other areas of the education bureaucracy without much impact.

The biggest ruckus would probably be raised by economists. As George Stigler once pointed out, economists are “the premier ‘pourers of cold water’ on proposals for social improvement”, particularly through government activism. Although political supporters and utopian dreamers focus on the benefits of such proposals, an economist would inevitably ask about its (opportunity) costs as well.

The costs? Resources taken from taxpayers would be diverted from efficient uses to the subsidized area. Some people would have money taken from them through taxation—to support an activity that other people would not value enough to devote their own resources.

Proponents of free higher education would point to its positive ripple effects. But the diverted resources would also have negative ripple effects. On net, we would be merely moving resources from one sector of the economy to another. In a grand shell game, jobs would be gained, but more jobs would be lost.

Economists would also wonder about the impact of reduced property rights and ownership. If one doesn’t pay for something, they are less likely to take it seriously. This is already a concern since higher education is subsidized significantly by the federal and especially state governments. With even less skin in the game, students would be more likely to treat the education casually, reducing its value for all students.

Of course, if you don’t like my proposal, then you should also be opposed to our current provision of K-12 education. Elementary and secondary public schools are free and students must attend the government-run school in their neighborhood—unless their parents are wealthy enough to attend private schools or resourceful enough to homeschool.

If my proposal is not all that swift for young adults, how can it be the policy of choice for children?

McGovern critiques Obama

2011-09-20T09:38:00.000-04:00

McGovern counsels/schools Obama in the most recent issue of Harpers:

His recommendations:
-Bring home troops from Afghanistan.
-Close all military bases in the Arab world.
-Re-evaluate troop presence in (and probably withdraw from) Europe, Korea, etc.
-Cut excess from Pentagon budget.

--> All of those sound great. If only Obama would embrace "change"...

--> Ok, the last two aren't so sharp:

-Eliminate Bush tax cuts on the wealthy. (As I noted earlier, it'd be a lot better just to get rid of the income tax deductions that strongly disproportionately benefit the wealthy.)

-"Launch valuable public investments". (Apparently, George has not been paying close attention to current events. With recent efforts, his phrase is an obvious oxymoron.) He also points to a revival of the G.I. Bill, but only for college students. I wish George would get on board with a G.I. Bill for kids.

Obama vs. the economy in general and the wealthy in particular

2011-09-20T09:15:00.000-04:00

From the AP's Jim Kunnhenn in the C-J...

In a blunt rejoinder to congressional Republicans, President Barack Obama called for $1.5 trillion in new taxes Monday, part of a total 10-year deficit reduction package totaling more than $3 trillion.

“We can’t just cut our way out of this hole,” the president said.

Sadly correct. Obama and his fans-- and even most of his opponents-- lack the necessary combination of intelligence, worldview of government, and political will to get that done.

Obama wants to cut Medicare and Medicaid by $580 billion. He wants to save $1 trillion over 10 years from the withdrawal of troops from Iraq and Afghanistan. He also "targets subsidies to farmers and benefits programs for federal employees".

Along with these, he wants to spend (and largely waste) another $447 billion in temporary tax cuts and new public works spending "as a short-term measure to stimulate the economy and create jobs". (Could he really be this much of a moron? Or is he just so cynical that he'll continue to waste money, hoping for the economy to recover despite his efforts and for people to embrace a false-cause fallacy and give him credit?)

Obama would let Bush-era tax cuts for upper income earners expire, limit deductions for wealthier filers and close loopholes, and end some corporate tax breaks.

In the WSJ, from Carol Lee and Janet Hook, we learn more detail-- that:

The largest chunk of Mr. Obama's tax package comes from limiting itemized deductions for families with more than $250,000 in yearly taxable income and individuals with more than $200,000, including those for home-mortgage interest, state and local property taxes and charitable donations. The White House says that measure would raise roughly $400 billion over 10 years.

Far better, we'd get rid of all deductions-- except perhaps charitable contributions-- saving far more money, reducing redistribution to the wealthy, lessening tax avoidance, getting the wealthy to pay more taxes, and so on. Getting rid of the Home Mortgage Interest Deduction would save $132 billion per year. So, by itself, over a decade, that would work out to well over $1 trillion by itself!

I wish Obama would have proposed something revolutionary like that (you know, "change")-- and it's difficult to imagine that proposal being any less likely to pass than his class-warfare-oriented tax proposal.

The funny thing: If he'd just get rid of the home mortgage interest deduction, he wouldn't have to raise tax rates at all! Or if he got rid of all income tax loopholes, he could lower tax rates and be a hero.

I'm surprised by all of this. For all of the talk about "change", this shows a remarkable lack of creativity and vision. Why not do something extraordinary, instead of continuing to cement his legacy as the sad sequel to Jimmy Carter? He'd rather continue to jerry-rig a messed-up tax code, posture on class warfare, and do more damage to the economy-- than embrace "change" and be in the history books for something remarkable.

"Let 'em fail"?

2011-09-17T14:29:00.001-04:00

At the most recent GOP presidential debate, there was a famous exchange between CNN’s Wolf Blitzer, Rep. Ron Paul, and the partisan crowd. Blitzer asked Paul about a hypothetical 30-year-old man who refused to purchase health insurance, got sick, and needed extensive medical treatment. Blitzer asked “Who pays?”

Paul replied, “That’s what freedom is all about, taking your own risks…”

Blitzer interrupted him by asking “Are you saying the society should just let him die?”

A few people in the crowd shouted “Yeah”. But Paul said no—and then explained that society should and would take care of him.

Paul continued: “We’ve given up on this whole concept that we might take care of ourselves, assume responsibility for ourselves. Our neighbors, our friends, our churches would do it. This whole idea—that’s the reason the cost is so high!...We dump it on the government; it becomes a bureaucracy; it becomes special interests; it kowtows to the insurance companies and the drug companies…”

Paul made a number of interesting and important points. But aside from his astute analysis, it’s clear that his reply runs counter to conventional ethics. In contrast, many (most?) people believe that we should not rely on freedom and markets. Instead, they want the government to take a lot of money from a lot of people—to support others who make bad decisions and/or face circumstances beyond their control.

When I heard the debate over “let ‘em die”, I immediately thought of students in a classroom. If a student decides not to study appropriately, should I “let ‘em fail”? I’ve always thought so, but maybe I should reconsider. Should I lower the grades of the successful and increase the grades of those who don’t study or just aren’t very smart. (I could transfer grade points explicitly—for example, from “wealthy” A-students. Or I could arbitrarily increase the grades of D&F students, devaluing the grades of A-C students.)

It turns out that the analogy is limited in two important ways. First, health care can be much more important than grades. Of course, grades are important too. If you don’t graduate from high school or college—or you graduate with a weaker major or a lower GPA—then this will have a dramatic impact on your standard of living. And much health care is not vitally important. So, the analogy only falls short when referring to catastrophic or highly-significant health considerations.

Second, I don’t do anything to get in the way of my students earning a good grade. In fact, I do a lot to help them learn and succeed. In contrast, the government is quite busy making it much more expensive to obtain health insurance and more difficult to obtain care. The federal government subsidizes the purchase of health insurance through businesses, causing it to move away from the normal role of insurance in covering rare, catastrophic events. Vastly broadening the scope of health “insurance” causes a dramatic increase in the cost of health care and especially, health insurance. (Imagine the cost and accessibility of auto “insurance” if it covered door dings, oil changes, etc.) This makes Wolf Blitzer’s scenario far more likely. As the government vastly inflates the cost of health insurance, it tempts people to take their chances.

In addition, state and federal governments have all sorts of mandates and regulations on health insurance—that increase costs and decrease competition in the market for insurance. In fact, government has all sorts of other regulations—on everything from prescription drugs to labor markets—that cause all sorts of trouble, but this would require a far longer essay! (If you’re interested, check out my paper in the Winter 2011 edition of Cato Journal.)

Rep. Paul’s answer was to rely on markets and freedom to take care of people. The flip side of that coin is to reduce government intervention—not only taking money from A to care for B, but also government policies that dramatically and artificially increase the cost of health insurance. Blitzer’s question will always be with us. But why do we ignore the many government policies that make his question so much more relevant?

Social Security, fraud, and Ponzi schemes

2011-09-14T12:54:00.001-04:00

Recent, useful essays from Jacob Sullum and John Stossel on Social Security...

The claim that "Social Security = Ponzi scheme" is:
a.) too rough on SS, since "scheme" implies intent

b.) too light on SS, since it's mandatory and causes so much pain for the working poor and middle class

c.) too rough on SS, since the former is legal

d.) too light on SS, since both are immoral and the former has the sanction of the governing authority

e.) too rough on SS, since the latter is built on fraud

f.) too light on SS, since the former is supported by fraud and takes advantage of trusting citizens

Norquist's "Leave Us Alone"

2011-09-10T13:21:00.000-04:00

Norquist is well into his third decade as a big wheel in GOP and conservative circles. I got to hear him speak in Indy about a month ago, where he distributed copies of his latest book.

The subtitle of the book is "Getting the Govt's hands off our money, our guns, our lives"-- which sounds quite libertarian, if not Libertarian. In fact, Norquist argues that Americans tend to be libertarian at least with respect to their own lives and often, on many issues. The trick then, from a Libertarian perspective, is to encourage people to think more coherently about the role of government-- a.) putting aside their special interests in some cases; and b.) sacking their little-considered beliefs about the supposed efficacy of govt (in areas where those beliefs are ultimately shaky or even unfounded).

The book is a combination of demographic predictions, historical descriptions, and policy wonkish discussions. He's trying to figure out where there are trends and explain/forecast from there. He identifies the two sides as the "Leave us alone" and "Takings" coalitions. He notes that Dems tend to be in the latter and GOP'ers tend to be in the former, but some people are hybrids and the GOP, in particular, faces a temptation to cross over to the Takings side.

Norquist uses humor effectively, making it more interesting to read. For example, in the preface, he opens by saying his book is not entitled "The other team sucks", before noting that "Others have done fine work here". He also notes that his book is not utopian: "I discovered that the world was not organized around what I wanted done. I was very disappointed. But unlike some, I was ten years old when this truth became painfully clear."

Norquist is generally optimistic about the GOP's political chances/opportunities. He notes that no Democrat had received 51% of the popular vote since Johnson in 1964. (Since the book was published, Obama got 53% in probably the best of circumstances for a Dem.)

Although I think he's generally correct, he understates the importance of abortion to one important subgroup in the GOP (p. 31-32). (In fact, I and others have written about why the pro-life position was-- and could be again-- a Democratic issue.) And he overstates the extent to which police and fire will vote GOP, given the union angle. (Police and fire are the most potent special interest groups at the local level.)

His chapters on trends are interesting-- the extent to which a growing investor class, shrinking labor unions, age demographics (including the exit of FDR Democrats), fewer hunters, more people on welfare, homeschooling, voter fraud, ethnic groups demographics and media competition/access. Whether he's correct or not on the particulars-- and it seemed like strong analysis to me-- he has correctly identified potential trends, whether positive or negative for conservative political outcomes.

Some small nuggets:

-Goldwater and many GOP'ers opposed the supply-side tax cuts of JFK, apparently believing the then-dominant Keynesian view that such cuts would be inflationary. Wow!

-Norquist notes that many states have flat taxes and the SS tax is a flat tax as well. Why would someone be aggressively opposed to the same for the "income" tax?

-Federal spending under Clinton fell from 22.8% to 19% of GDP. Under Bush into 2006, it rose to 20.3%. Since then, under Bush and Obama, it's been 23-25%.

Sherman-Minton down...long-run consequences?

2011-09-10T10:59:00.002-04:00

According to WLKY, the S-M bridge was handling 35% of bridge traffic (81 of 235K). Turning the coin over, that means the other two bridges will handle 55% more traffic now.

Just think what would happen if we lost the Kennedy too, even temporarily...

Even with the S-M, our bridges were insufficient-- and a threat to business. With this problem, the likelihood of Ford, GE, and especially UPS leaving or diminishing their footprint is even greater.

Thanks again, to the geniuses, political hacks, and self-serving rich people who have stood in the way of the obvious infrastructure improvements .

Eugene Peterson on the Lord's Prayer

2011-09-03T09:54:00.000-04:00

Over the past year, I've really enjoyed Eugene Peterson's books-- most recently, Tell It Slant.

Peterson introduced me to a framework on the (synoptic) Gospels that I had not heard previously: Matthew is about teaching; Mark is about preaching; and Luke is about talking with Samaritans. Matthew and Mark spend two chapters on Jesus' trip to Samaria, but Luke spends ten chapters. And notably, this huge chunk includes the vast bulk of Jesus' parables.

Peterson notes that Jesus goes from Galilee (an analogy to Sunday) to Jerusalem (another Sunday)-- with Samaria (Monday - Saturday) in between. In other words, the Christian life is largely lived in Samaria. How shall we communicate with them? Peterson borrows from an Emily Dickinson poem that uses the phrase "tell it slant" to indicate that we can't handle the truth many times-- and that truth is best communicated, often, when delivered at an angle. Thus, Jesus' use of parables in talking with the Samaritans-- and a lesson for us, as we deal with the Samaritans in our lives.

In addition to the framework, Peterson delivers a ton of nuggets on the parables-- before turning to Jesus on prayer (another key theme in Luke, more than any other gospel). Again, Peterson delivers a lot, including what turned out to be my recent Sunday School lesson the Lord's prayer (with some help from Dallas Willard in his excellent book, The Divine Conspiracy). What follows is my lesson outline. (If you get bored with the [cryptic] details, skip to the bottom for the punchline on rote vs. spontaneous prayers.)

Intro/Prelude (Mt 6:5-8, Lk 11:1)

-the only time (recorded) that the disciples ask to be taught (Lk 11:1)

-in response, Peterson (48): “The model prayer that Jesus gives them is surprisingly, maybe even insultingly, brief…He has barely started before he is finished…38 words. Prayed meditatively, it takes a mere 22 seconds. And then it’s over. Class dismissed.”

-a matter of the heart: at almost the center of the Sermon; prayer at core/heart

-preceded in Mt 6:5-8 by two warnings: 5-6’s “seen”—trying to impress others (as 6:1-4’s giving) and 7-8’s “many words” (alludes to simple, heart, style, purpose)

-internal; Peterson (168a): “Prayer is the heart of this kingdom life. But…nobody ever sees a heart when it is working…”

-but manifests as action; Peterson (171a): “Six, brief, single-sentence, petitions compose this prayer. Each verb is an imperative, a call for action. Prayer is not passive…As we pray with Him, we volunteer ourselves into the action.”

--> learn and do His will, wisdom and courage, knowledge and power

Intro/Address: “Our Father who art in Heaven…”

--> Willard (255): “The ‘address’ part of prayer is of vital significance…[it] distinguishes prayer from worrying out loud or silently, which many, unfortunately, have confused with prayer…”

-our: you and me; we’re in this together

-Peterson (168b): “With the ‘our’, Jesus puts himself in our company. With the ‘our’, we place ourselves in the company of Jesus and of all who pray.”

-Father (15x in Sermon): prayer as personal (relationship) vs. device or technique

-“Heaven”: sovereignty, worthy of praise

--> the combo in tension/balance; Willard (257b): “calls attention to our standing in relation to the one addressed…unfortunately…[this phrase] has come to mean ‘our father who is far away and much later’…”

I. “…hallowed be Thy name.”

-hallowed: holy (defined)

-vs. intimacy of “Father”; tension/balance revisited

-Peterson on contrast with 1^st sin in Eden (bring God down to our level) and Babel (bringing us up to His level)

-name: person vs. principle; not a “to whom it may concern”

-the combo: it is (!) and that we would treat it well

II. Thy Kingdom come.

-in tone, centered on God and others; encourages an eternal perspective

-kingdom(s)—and His kingdom come, interpreted as…

-heaven vs. earth, now vs. end of time

-vs. come into existence

-come into recognition vs. ignorance of God’s sovereign kingdom

-or conflicting kingdoms—of Satan (Eph 2:2) and those in the world; brought more fully by Jesus and to be increased by us in partnership with God

-Willard (259b): “naturally wants his rule, his Kingdom, to come into realization in any place where it is not fully present.”

-working to subvert others—but not through coercion

-Peterson: Jn 18:36’s not of this world, but everything to do with this world; not standard idea of sovereignty; not into tools of force (Rom 14:17; Zech 4:6); “Christ is king, but from a cross”

III. Thy will be done…

-will: implies volition and purpose (vs. meandering); energy (vs. listless)

-Peterson (179): “There is an enormous amount of dishonesty and just plain silliness written and spoken about the cause of Christ. Much of it concerns matters lumped under the heading ‘the will of God’…[this is] odd, because the Bible could hardly be more clear on the matter.”

-specific vs. general (Ps 40:8, Mt 6:33, Eph 5:17-21, Col 1:9, 4:12, I Thess 5:16-18, 5:23-24, I Tim 2:4, I Pet 3:17, 4:2, 4:19, II Pet 3:9, I Jn 5:14-15, Rev 2:26)

Interlude: on earth, as it is in Heaven.

--> Peterson (235): “the first three incisive, God-orienting, reality-defining imperatives in the Lord’s prayer that lay a strong foundation for a life of believing obedience…Each successive imperative gathers energy and increases in intensity, the way a spring is coiled tighter and tighter, until it is released by a trigger. The triggering words are ‘on earth as it is in Heaven’.”

-Peterson (180b): “Heaven is where it all begins. Heaven is where it all ends. Heaven is our metaphor for what is beyond us, beyond our understanding…Earth is where we play our part…The polarities of reality, heaven and earth, fuse: ‘on earth as it is in Heaven’.”

--> now, transition from “your” to “us/me”—a big change in pronouns (1^st 3 vs. 2^nd 3)

-Peterson (181, 182a): “Prayer involves us deeply and responsibly in all the operations of God. Prayer also involves God deeply and transformatively in all the details of our lives…Prayer gets us in on what God is doing…[And] prayer gets God in on what we need to live to his glory.”

-see: us in Christ; Christ in us (Gal 2:20, Col 1:27; Rom 8:1, Eph 1:3)

--> and from general/social to specific/individual…

IV. Give us this day our daily bread.

-give us: grace/gift

-daily: continual

-bread:

-basic/staple

-start with body; the first but not the last thing we need is bread (Jn 6)

-Peterson: acknowledge need/limits and thankful embrace of a good creation; “Every limit is access to gift”

-prominent role in subsequent parable in Luke, who tightens and removes the 3^rd petition (in most manuscripts), leaving bread at the center of his version of the prayer: bread as 3^rd petition in Luke’s version and 3 loaves of bread in the parable (Lk 11:5-12)

-Peterson (55): “We are all beggars. Father, give us bread. Friend, lend us three loaves.” (God and others!)

V. And forgive us our debts, as we forgive our debtors. (Mt 6:14-15’s postlude)

-Peterson (185a): “Giving (#4) and receiving is God’s creation norm…But it is not normative in the human community…And so we need forgiveness.”

-need to acknowledge sin, but Peterson (185b-186a): “But exposing and naming sin is not at the center of life lived to the glory of God…Forgiving sin is gospel work.”

-even in the midst of difficulty—as Jesus on the cross

-personal: Peterson (186b-187): “God is personal, emphatically personal…So if something is going to be done about sin, it is not going to be along the lines of laws and rules…We don’t sin against a commandment; we sin against a person [and God]. Since is not an offense against justice; sin is an offense against a living soul. Sin is not sexual impropriety; sin is the debasement of a man, a woman, a child. Sin is not a violation of the law of the land or the rules of a house; sin is a violation of a personal relationship.”

VI. And lead us not into temptation, but deliver us from evil.

-double imperative: “lead us not…deliver us”

-seems odd; God wouldn’t do this—so what does it mean?

-Peterson (189b, 190a, 190b): “He has prayed with us into a life of grace (#4)…He has prayed with us into a life of forgiveness (#5)…So, what’s left? The fact is that we don’t know…The [first] five petitions are prayed out of present activity…The sixth petition prepares us for this ‘more’…unanticipated temptations and deceptive evil [Gen 4:7, Heb 4:15]…As glorious as the world is, it is also perilous. Dangers that don’t have the appearance of dangers…Evil that masquerades as an angel of light…We need help. And we need help even when we don’t know we need help. Especially when we don’t know we need help.”

-discernment with what we do/can sense; protection from that and what we do not sense

-Willard (265, 266-267a): “This request is not just for evasion of pain and of things we don’t like, though it frankly is that. It expresses the understanding that we can’t stand up under very much pressure, and that it is not a good thing for us to suffer. It is a vote of ‘no confidence’ in our own abilities. As the series of requests begins with the glorification of God, it ends with acknowledgement of the feebleness of human beings.”

-Peterson on Eve and Jesus (191-193): “Eve in the Garden…was tempted to receive as a gift something that she is convinced is altogether good…Jesus in the Desert…tempted to do three things that…are all about doing good…The stories of Eve in the Garden and Jesus in the Desert are strategically placed to supply a powerful antidote to our naivete…A person in a completely spoiled, attractive, and beautifully idyllic place…can be deceived into making good into evil…[And] A perfectly prepared person…is still seriously at risk.”

-subtle; Peterson (194): “Fifth-petition sins, for which we ask forgiveness, are far easier to notice and take responsibility for than sixth-petition temptations—the temptation that seduced Eve, the temptations that Jesus rejected…And so, because of the heightened peril involved in these temptations, Jesus gives us this petition of prevention.”

à at Gethsemane, the third of each set of three; in Gethsemane, the temptation to do evil by avoiding a call to obedience, suffering, and sacrifice

Conclusion (traditional—and from some manuscripts in Matthew): For thine is the Kingdom, and the power and the glory for ever. Amen.

-Peterson (195-196): “That’s it. Prayer succinct and bold…We step back and trust God to do with our prayers whatever, however, and whenever he chooses…[It] puts us outside the prayer itself in a kind of holy detachment…All now is in our Father’s hands.”

--> what to do with the prayer? I Thess 5:17 and use of rote and spontaneous prayers

-Peterson: “There is a prevailing bias among many American Christians against rote prayers, repeated prayers, ‘book’ prayers—even when they are lifted directly from the ‘Jesus book’. This is a mistake. Spontaneity offers one kind of pleasure and taste of sanctity, repetitions another, equally pleasurable and holy. We don’t have to choose between them. We must not choose between them. They are the polarities of prayer.”

-Lord’s prayer as organized but conversational, basic but universal, broad but detailed (helps with 5:7-8)

-see also: Eph 3:14-21, Neh 1, Psalms, etc.

job growth = 0 in August

2011-09-03T09:03:00.000-04:00

ZERO job growth in August-- while June and July numbers are revised (significantly) downward.

The WSJ's Justin Lahart has an article on a less common statistic/proxy for the sad state of affairs in labor markets: the proportion of adults working.
The employment-to-population ratio stood at just 58.2% in August, according to the Labor Department, a hair above the 28-year low it fell to in July. That is down from 62.7% in December 2007, when the last recession started, and below the all-time high of 64.7% it reached in 2000...It isn't unusual for the ratio to decline during a recession, since that is when it is harder to find work. What is unusual is for it to go lower through a recovery, as it has for the past two years...

The ratio has fallen for people from all walks of life, but some groups have been hit harder than others. For example, the ratio for men has fallen to 63.6% from 69.4% when the recession started, compared with a smaller drop for women, albeit from a lower base, to 53.1% from 56.5%. The shares of young people, blacks and the less educated have all fallen sharply.

This WSJ article, by Sudeep Reddy, has some good info, including a terrific comparison to other recessions.

The primary jobs problem, going forward, is that with the debt run up by our leaders, we'll need to cut spending (tough on public-sector jobs) or increase taxes (really tough on private sector jobs). State/local govt will continue to struggle, including lay-offs. And with the debt, the ability to "stimulate" short-term-- even if that were desirable-- is greatly reduced.

Thank you to President Bush, Congress, and especially President Obama-- friends of the working class-- and to all Keynesians!

Choose your favorite, famous related movie line:
a.) thank you sir, may [we] have another
b.) you'll get nothing and like it!
c.) other (make suggestions)

our trip to Bardstown

2011-08-07T17:19:00.000-04:00

Tonia and I get away every year for two days or so. (Our parents-- usually hers-- watch the kids for us while we're gone.) We have a great time-- talking and enjoying each other, strategizing over the year to come, and seeing the sights. We've always stayed close and covered cities big and small.

You expect the big ones to have plenty to do, but the small ones have always been pleasant surprises. Columbus (Indiana) is probably our favorite, since it has so many different options-- itself along with Brown County, Nashville, and Edinburgh. (Madison and Lexington were also excellent and I've blogged about them here.)

This year, we chose Bardstown.

Started at nearby Bernheim Forest-- beautiful and a warm, bug-heavy two-mile hike.

Stayed at the Best Western, which was fine, except for a shower that was only 6' 6" tall and a shower head measuring in at 5' tall! Dinner at the Old Stable Inn-- very good.

The Civil War Museum emphasizes the western theater of the war-- and was far better than I expected.

The "Stephen Foster Story" musical was very good-- weaving a stronger-than-expected story line with his beautiful melodies, dancing and so on. The Stephen Foster State Park (My Old Kentucky Home) was interesting. We wish we had seen that before the musical.

The Oscar Getz Bourbon/History museum was the most surprising. It was free and we didn't expect much, but it had a ton of fascinating detail on making bourbon, the history of the U.S. govt's approach to it, and so on. We'd recommend that before a plant tour-- to have a far better idea what they're describing.For our plant tour, we went to Makers' Mark. They seemed quirky in their brochure and the tour was entertaining and informative. The production and especially its marketing were impressive. It was interesting to hear about their efforts to keep the bitter out of their bourbon, keeping the taste on the front of the tongue and the burn down the back of the throat.

The Kentucky Rail Museum in New Haven was good. Without the interesting discussion of postal delivery by train, it would have been a disappointment.For lunch, we had a Short Line burger at the Short Line Diner in New Haven. Wow! It's the only restaurant in town, but that was memorable.

We finished up with the Abbey at Gethsemani. I expected the references to work, spiritual disciplines, ascetism, but was impressed by the emphasis on faith, prayer and Jesus.

And we didn't even get to the Bardstown Opry on Friday night, the Wizard of Oz (at Stephen Foster's), or Hodgenville for Lincoln's birthplace. There's a lot to do there. Check it out!

intro to Exodus

2011-07-19T11:35:00.000-04:00

Overview/Framework of Exodus:

Alec Motyer points to Israel:

a.) in Egypt (1:1-13:16)—the saving Lord;

b.) at Sinai (13:17-24:11)—the covenant Lord; and

c.) around the Tabernacle (24:12ff)—the indwelling Lord.

He also notes a chiasm in the structure of Exodus: Building for Pharoah vs. God (chs. 1-5, 35-40); Lamb of God vs. Golden Calf (6-12, 32-34); and Companion God vs. Indwelling God (13-18, 25-31)—all centered around the Grace and Law of God (19-24)

The theology of Exodus includes revelations about…

1.) His Name: Yahweh—“I AM” (3:14)

2.) His Salvation: as Redeemer/Rescuer/Savior (6:6, 15:13; Ch. 12's Passover; and a key OT theme as a picture of God's grace, sovereignty, power, especially in the face of injustice and oppression). For the believer, it serves as a picture of being freed from bondage (Justification; Jn 1:29; I Cor 5:7) and setting out for the Promised Land (Sanctification).

Combining Ex 3:14’s Name of God and Ex 12’s Passover Lamb, Motyer observes the revelation of the same combo in the NT at the beginning of Jesus’ ministry—at his baptism—when the Trinity has its first plain revelation and is bracketed by John the Baptist’s two references to Jesus as “the Lamb” (Jn 1:29,36).

Note other parallels as well:

-Israel is identified as God’s “firstborn son” (Ex 4:22)

-in Matthew, Jesus is also threatened with genocide (2:12,16); journeys into and out of Egypt (2:13-15); travel to the Jordan (vs. Red Sea); time in the Wilderness with the absence of food and water; putting God to the test (Ex 17:2; vs. not—Mt 4:7); and failure vs. success at the mountain (Ex 32 vs. Mt 4:8-10).

--> Motyer: “Exodus is the story of the son of God who stands in need of salvation, failing at every point of life and even of privilege; Matthew tells of the Son of God who brings salvation (Mt 1:21), perfect and righteous at every point and in every circumstance and test.”

3.) Other attributes:

In Genesis, God as

a.) Creator—sovereign over nature;

b.) moral judge; and

c.) covenant maker.

To compare/contrast these themes in Exodus:

a.) miracles: more than any other OT book—most importantly, to show Himself as a single God with universal sovereignty (9:16). He reiterates his sovereignty over nature, but in the context of depicting His sovereignty over history. (Without the latter, a God of Creation results in deism.) As Sarna notes: “History is the arena of divine activity…the product of God’s providence, conditioned by human response to his demands…the unfolding of God’s grand design…It is no wonder that the Exodus is the pivotal event in the [OT] Bible.”

b.) holiness: Here, we see the origins of the (formal) law—and with the Sinai covenant, the foundation of Biblical ethics and morality (the 10 C's and other categories of law: mitzvah, hok, mishpat). God’s zealous/active holiness is depicted by fire (Ex 3’s bush, Ex 13-14’s pillar, Ex 19’s on top of Mt. Sinai, Ex 40’s over the tabernacle).

c.) faithfulness: fulfilling covenantal promises made in Genesis to Abraham and Co. (2:23, 4:22, 12:41-42)

4.) Working with a man/family in Genesis-- and now, a nation: Pharaoh is the first to call them a “people” (1:9; only translated by the NIV for Egypt, not Israel; narrator uses “Israelites” in 1:7); later in Exodus, called nation (goy), congregation (kahal), and community (udah). As such, “politics enters the narrative, center-stage…”—and so, we find a huge emphasis on justice, freedom, and rule of law; sanctity of life and human dignity; use and misuse of power. As an aside, Sacks argues that Pharaoh is more political than evil (vs. Haman, Amalekites; Dt 23:7 vs. 25:17-19).

5.) A theology of worship: putting time, talent, and treasure into building the tabernacle—where God “dwelt” among his people (Ex 25-30,35-40). The NIV Study Bible: "God is not only mighty on Israel's behalf; he is also present in their midst." Here, we find the beginning of the priesthood and prophet roles. And it’s interesting that law and worship are combined.

In sum, the NIVSB: Exodus is an "account of redemption from bondage leading to consecration in covenant and the pitching of God's royal tent in the earth, all through the ministry of a chosen mediator, discloses God's purpose in history-- the purpose he would fulfill through Israel, and ultimately through Jesus Christ the supreme Mediator."

And Motyer: “Exodus begins the normative OT (and biblical) revelation of God’s way of salvation; it underlines the nature of God as holy and of humankind as sinners; it explains the meaning of blood and sacrifice; it is a book of grace which reaches down from heaven and of the law which teaches redeemed sinners to live in heavenly terms. While some of these great biblical truths are foreshadowed in Genesis, Exodus pulls them all together, giving them a shape and definition that the rest of the Bible will not alter.” (see also: p. 11-12)

Finally, we have an Intro to the Main Character: Moses. A Hebrew boy, a life saved by grace, a prince under Pharaoh, an outcast in the desert, a servant of God, and a type of Christ—as a deliverer (Jn 5:46). It’s interesting that the two largest gaps we have in Biblical history are inter-testamental times (pre-Christ) and pre-Moses.

LaSor notes that Moses "dominates the Pentateuchal narratives from the 2nd chapter of Exodus to the last chapter of Deuteronomy. Throughout the OT, he is portrayed as the founder of Israel's religion, promulgator of the law, organizer of the tribes in work & worship, and their charismatic leader through the deliverance, covenant at Sinai, and wilderness wanderings, until Israel was poised to enter the promised land from the Plains of Moab."

We covered chapter 1 last Sunday. I hope to post on that soon. We hope to see you on future Sunday evenings!

our trip to NY

2011-07-13T23:56:00.004-04:00

We just got back from our second annual big vacation. Last year, we went to NC; this year, we went to NY. We hit most of New York, except for the City. Ten days and nine nights (all in different hotels; we thought about camping, but didn't get organized for it). About 2,100 miles, much of it on the first day and the last two evenings. NC was nice; this was better.

Day 1: from Louisville to Sandusky, including BibleWalk (a Bible wax museum) in Mansfield and some time at a beach on Sandusky Bay. I had hoped to see the Memorial Museum in Mansfield, but they have limited hours.

Day 2: Cedar Point-- a terrific amusement park, especially if you like roller coasters. Favorites: MaxAir and Millennium Force. Most unique: Dragster (0 to 117 mph in 3.5 seconds; straight up and then straight down-- crazy, but it's all over in 17 seconds).

Day 3: Saw the largest covered bridge in the world (near Austinburg, OH), passed up the amazing beaches at Presque Isle (near Erie, PA; we wanted to get to Niagara Falls ASAP, given the holiday weekend), visited a very cool kazoo factory (the original) in Eden, NY, and did a bunch of the things-to-do at Niagara (Maid-of-the-Mist, Aquarium, Discovery Center, Cave-of-the-Wind) and walked around on Goat Island to get our best views of Horseshoe Falls. MM and CW are a must-do; the kids (esp. Joseph) liked the aquarium; and the adults really liked the DC (a museum of sorts).

Niagara is beautiful in an awesome way-- like the Grand Canyon. In contrast, the canyons at Bryce, Zion, and DeChelly are more-- or at least differently-- beautiful, in a more intimate sense. Likewise, we would see this sort of beauty later in the trip, at Watkins Glen.

Day 4: Niagara cont'd, including the IMAX and an excellent hike down to the river's edge at the Whirlpool State Park. Then, leaving the area, we visited Lockport and saw the Erie Canal-- in particular, Locks 34 & 35-- in action. From there, we drove to Alexandria Bay and the 1000 Islands.

Day 5: Maze-land (very fun, especially if you have kids), the amazing Boldt Castle (start from the yacht house on Wellesley Island if you don't want to pay for the boat ride), and swimming on Wellesley Island to wrap up the day.

Day 6: Found a really nice place to stay in Ogdenburg, Stone Fence Resort. The next morning, we saw the Remington Museum and his terrific sculptures. From there, we saw the Eisenhower Lock/Dam at Massena lift a huge ship by 42 feet in seven minutes. Next, we drove to my old hometown of Malone. (We lived there when I was 9-13 years old. Many of my dreams have parts of that town as the backdrop!) We drove through Lake Placid and saw the ski jump site. We wanted to stay at Ft. Ticonderoga and then visit that the next AM, but there were no rooms there or in the next town. So, we moved on to Lake George for the night.

Day 7: Whitewater rafting (level 2-3 rapids) on the Sacandaga River. Plan A had been Ft. T and then rafting. Plan B started with rafting and finished with the Hyde Collection in Glen Falls (a good plan B, but probably not as good as plan A!)

Day 8: The Baseball Hall of Fame in Cooperstown. That was terrific and I was happy to find that my desire to be there only lasted a bit longer than the rest of my family! From there, we drove to Ithaca.

Day 9: Hiking in Taughannock State Park (three sets of waterfalls)-- very nice. Brennan was stung by three bees and we had been worried that he might be allergic, but he didn't have any trouble (aside from discomfort). Then, hiking at Watkins Glen State Park-- as beautiful as anything I've ever seen. The combination of waterfalls, greenery, and rock were like something out of a movie. I thought I'd only see stuff like that in movies, this side of heaven, but it really exists-- at least there. (We also went swimming at a big pool at the south entrance to the park. Very nice!)

Finally, we only had 1.5 hours for the Museum of Glass in Corning. That needed at least another hour or so to do it right, but I'm glad we got to spend some time there. The invention and innovations within glass were spectacular. And some of the glass art was phenomenal. From there, we drove that evening to Johnstown, PA.

Day 10: We saw the flood memorial at South Fork (near Johnstown) and learned that David McCullough's first book had that as its topic. The "Inclined Plane" in Johnstown was amazing-- the steepest of its kind. We drove a few hours and saw a terrific ("unofficial") Legos museum in Bellaire, OH-- again, a must-see if you have kids and a terrific way to break up the drive back to Louisville.

It was a great trip. I would recommend most of it to couples without kids who love the outdoors (it would be terrific for a honeymoon or anniversary celebration)-- or for families with kids who can handle some hiking. I wouldn't bother going north of Alex Bay. (We did that so I could see my old hometown.) And even that might be too far north to be worth it. A worthy (and more leisurely) alternate would be to see Niagara Falls and then spend a big chunk of time in the Finger Lakes region.

The unintentional, over-arching theme was water-- from an amusement park on a peninsula jutting out into one of the Great Lakes to a National Park commemorating a flood that killed more than 2,000 people; from the small lock/dam with the Erie Canal to the large lock/dam at Massena and the St. Lawrence River; from waterfalls to glens; from driving over the world's largest covered bridge to white-water rafting.

If you have any questions, let me know...

finishing up my review of Coyne's "Why Evolution Is True"

2011-06-20T20:56:00.000-04:00

A few weeks ago, I blogged on a terrific evolution cartoon and Neil Shubin book on our "Inner Fish", and my early thoughts on the introduction and chapter 1 of Jerry Coyne's Why Evolution Is True.

My early impression was that Coyne was a mess. Then, in the midst of finishing his book, I came across a CT article, noting that Coyne had described Francis S. Collins' ideas as "scary...bizarre...inane...snake oil" and that he "pollute his science with his faith". So, Coyne has quickly established that he's a jerk and a moron-- at least in terms of religion, if not science.

But the funny thing is that Coyne's book got better as it went along. He provides a lot of good evidence for natural selection in areas from genetics to the fossil record-- much of it new to me. So, if you're looking for that, I can now recommend his book, despite the silly stuff.

As for the silly stuff, it fades a bit as the book goes along; in a word, Coyne becomes a bit more humble as the book evolves. Picking things up in chapter 2...

-Early in chapter 2, he draws an analogy between the available fossil evidence and a scattered and torn book with only remnants of pages still remaining. Of course, Coyne feels quite comfortable drawing inferences from the remaining evidences. "Without them, we'd have only a sketchy outline of evolution." (p. 21). By any objective standard, the outline is still quite sketchy, even if one is impressed by the evidence and the accompanying narrative. (And if we're comparing Evolution to literal writing, I wonder what he thinks about the evidences for the preservation of the Bible.)

-At times, he admits the staggering task at hand for evolution: "The theory of natural selection has a big job-- the biggest in biology. Its task is to explain how every adaptation evolved, step by step." (p. 119) Exactly. At present, only someone with a lot of (implicit or explicit) faith in the narrative can get there. Elsewhere: "We should be able to imagine a plausible step-by-step scenario for the evolution of that trait." Exactly. Imagine a scenario. With the "ability to extrapolate time...it becomes to easier to accept that...selection could cause..." (p. 125) Yep, an exercise of extrapolation to accept (on faith) that selection could do such-and-such. Who can argue with that? And given artificial selection, "making the leap to natural selection was not so hard" (p. 127). Leap of faith, anyone?

-On transitional forms, Coyne is coy about the extent to which they matter. In his mind, we don't need many-- which happens to coincide with those we have in hand. He doesn't say what we should believe if we had fewer-- or the extent to which our faith should be bolstered by more. If it's a done deal, then we don't need any more.

-Coyne is candid about the limits of Evolution as early as chapter 2: "We have no idea what selective pressures drove the evolutionary changes in these plankton and trilobites. It is always easier to document evolution in the fossil record than to understand [and explain] what caused it..."

-Over and over again, he asserts what the creationist and ID models would predict. First, this runs counter to the frequent assertion that neither sets of models are testable. Moreover, Coyne seems confused about the extent of intervention required by ID and (old-earth) "creationism". The ID'er or God could have intervened a little or a lot. With ID, the question is whether design can be inferred probabilistically in some contexts. With old-earth creationism, evolutionary mechanisms are supposed to account for some/much of the variation we see today-- just not all. Coyne asks "Why would a creator put a pathway for making vitamin C in all these species, then inactivate it?" It's as if he can only imagine a black/white world where there is all/no evolution.

-Coyne repeatedly compares Evolution to his flawed, simplistic version of ID. "There is no reason a celestial designer...should make new species by remodeling the features of existing ones." (p. 54) Really?! "Species aren't all that well-designed, either: many of them show imperfections that are signs not of celestial engineering but of evolution." A common misperception of ID-- and it indicates that Coyne really believes these are competing hypotheses. "Perfect design would truly be the sign of a skilled and intelligent designer." OK, but that's not a criterion of ID. "Why would a creator...?" Coyne is quick to say X makes no sense if there's a creator, but slow to say that Y makes no sense if we rely on Evolution.

-He never gets around to defining ID properly. He completely skirts it early-on, makes a half-hearted effort in chapter 3 (p. 81,85), and finally makes a much larger effort in chapter 5 (p. 136-143). Here, tellingly, he asks for some wiggle room: "In the main, ID is unscientific, for it consists largely of untestable claims." (p. 137) Jerry, I would have thought that you could pin that down a little tighter? And then he wants to take back the wiggle room he requested earlier: "The onus is not on evolutionary biologists to sketch out a precise step-by-step scenario documenting exactly how a complex character evolved." (p. 138) Jerry, I know that explanations are tough business, much tougher than narrative and faith. And it cracks me up that he talks about scientists "intelligently designing" all kinds of stuff in the lab, without ever catching the irony.

-I wonder the extent to which evolution is falsifiable-- really. Coyne says that we will find an early land-dweller with reduced gills and limbs in freshwater sediments from 380 million years ago (p. 38). But what if doesn't work out that way? I'm figuring that the theory gets adjusted and we move forward, right? It seems unlikely that Coyne would reject everything if he's wrong on this prediction.

-In addition to the supposed evolution from land-bound mammals to whales, I'm surprised that he's so comfortable in imagining Indohyus (a raccoon-sized animal) turning into a something so large (p. 49-51). But he wraps up that section with the glib remark: "The sea was ripe for invasion. All of its benefits were only a few mutations away." Then, we find that evolution can easily go the other way too-- as glyptodontsThen, he concludes-- with no touch of irony-- that "Creationism is hard-pressed to explain these patterns." (Volkswagen-sized ancient armadillos with two-inch armor) are supposed to evolve into contemporary armadillos (p. 96).

-It's interesting that Evolutionists imagine the ostrich evolving to flight and then away from it (p. 57). Why was a smaller appendix better for us? Could it grow or shrink again? Likewise, he claims that eyes have evolved in and then out. And he claims that eyes take a lot of energy to build and can be easily injured (p. 59). True to some extent, I suppose, but it's difficult to imagine either of those as significant factors. Later, he asserts that a rudimentary light-patch could start-- and then the evolution to a retina and an optic nerve would follow through natural selection (p. 142-143). OK, Jerry-- if you say so!

-I don't understand the information component of the genome, but why would it degrade while unused? (p. 65)

-There is a fascinating discussion of the Asian giant hornet vs. European and Japanese bees (p. 111-113). The introduced European bees are at a severe disadvantage-- interesting if not unusual, since new species often gain and hold an upper hand. In contrast, the Japanese bees are claimed to have evolved a response that is effective against the hornet. But it seems odd that the evolution of an individual could survive to evolve into a group that was so powerful.

-One thing that gets some attention (to his credit), but ultimately is the subject of immense hand-waving, is the ability of mutated creatures to reproduce-- and survive and thrive-- over and over and over again. Sure, "once sex has evolved, sexual selection follows inevitably..." But how did sex evolve in its beginning? And relying on sex for natural selection is reasonable. The biggest problem? Assuming that the gene-- which promotes the ability of the female to identify the healthier males-- is able to evolve systematically. It's also interesting (and seemingly troubling) that more energy to non-productive characteristics is good in an evolutionary sense. But this is a problem of credibility: only the healthy can afford the sacrifice.

-Toward the end, Coyne takes evolution fans to task (p. 228)-- those who try to "Darwinize every aspect of human behavior, turning its study into a scientific parlor game...imaginative reconstructions of how things might have evolved are not science; they are stories". He then invokes Stephen Jay Gould and "Just-so-Stories". I wish he had talked about Gould's idea of "punctuated equilibrium", but maybe that's a little too close to home...

Moses: America's Prophet

2011-06-16T22:00:00.000-04:00

That's the title of Bruce Feiler's fun little book. He details how the character and actions of Moses run throughout American history-- from Columbus and the Pilgrims to Hillary & Obama in the Democratic primary, including George Whitefield, Thomas Paine, Harriet Tubman, Lincoln, Wilson, FDR, LBJ. He was the subject of a Thomas Mann novel and a famous film by Cecil B. DeMille. He's in Washington's letters; his writing is on the Liberty Bell. Moses is even a long-lost cousin of Superman. ("Americans may or may not have noticed Superman's Jewish identity, but Hitler sure did." [p. 225]) It's been used to promote civil rights and gay rights-- and it's been used to bring attention to the plight of Soviet Jews. It's been used to describe Bill Gates against IBM and then, Steve Jobs against Microsoft. Reagan was the Moses of conservatism and Clinton had his New Covenant. And so on.

Feiler argues that "no single thinker has had more sustained influence on American history over a longer period than Moses...You can't understand American history...without understanding Moses. He is a looking glass into our soul."

Off-and-on throughout the book, Feiler wrestles with why the touchstone is Moses more than Jesus. He provides a few reasons-- his humanness, his universality, and specific references like Washington crossing the river as Moses had crossed the Red Sea and Lincoln sees the Land but is unable to cross over to the other side. He even provides data on, for example, pastors who invoked Moses vs. Jesus after Lincoln died (34 vs. 16 with 113 vs. 42 references).

My favorite quote on this comes from his interview with Allen Guelzo, responding to whether he would have eulogized Lincoln with Jesus or Moses: "If Lincoln's greatest achievement was emancipation, then we're going to talk about him as Moses. If we think Lincoln's greatest achievement was redeeming the country from the onus of slavery, then we're going to talk about him as Christ...The Moses-Jesus track comes down to which is more important: deliverance or redemption...The private Lincoln is more like Jesus, but the public Jesus is more like Moses."

Feiler points to three themes that underline his application: "courage to escape oppression and seek the Promised Land...the tension between freedom and law...[and] the building of a society that welcomes the outsider and uplifts the downtrodden." (298-300). On freedom and law, Feiler describes this combination as covenant vs. freedom, responsibility vs. bondage, law vs. slavery, the desire to build a just society while holding onto the importance of individual responsibility.

Feiler concludes with three lessons he learned about Moses and those who invoke him: the power of story; the American narrative of hope; and the need to act (306-308).

A few other nuggets:

-I was not aware that American Jews had invested so much in the Civil Rights of African-Americans. It is that much more bizarre that there have been a handful of notable awkward moments between African-American leaders and Jews (253-256).

-A great observation and quote about Thomas Paine (60): "Paine was the anti-religious zealot who continually cited religious examples. He hated Scripture but quoted it relentlessly."

-Union troops were buried at Gettysburg with their feet pointing downhill, so that when the dead were resurrected, they would overlook the field where they had died.

-After averaging one per year, in the decade after the Civil War, there were 94 books published on heaven.

-DeMille had Paramount put granite monoliths of the Ten Commandments on public property to promote the film. The one in Austin later became the basis for the 2005 U.S. Supreme Court case that banned such displays in courtrooms.

-DeMille opens his film with an extended monologue, comparing Pharaoh to the USSR and Moses to America. (I remember being shocked when I saw that on video!)

-More evidence that the 1950s were a period of spiritual lukewarmness. Eisenhower once said: America "is deeply founded in a deeply felt religious faith-- and I don't care what it is." In the 1950s, "under God" was added to the pledge and "in God we trust" was added to the money. Which God? The god of civil religion opposed to godless communism.

It's an easy read. If you like history with a little bit of religious and cultural flair, pick it up!

Wickham's Folly: revolution without revolutionary change

2011-06-16T17:52:00.000-04:00

Here's syndicated columnist DeWayne Wickham with some convoluted thinking in the C-J...

The NAACP is being attacked by parents of New York City schoolchildren who are angered by the civil rights group's support for a lawsuit that seeks to keep 20 charter schools out of buildings that already are occupied by traditional public schools.

The suit also attempts to block the closing of some of the city's underperforming public schools, the kind of schools that make many parents clamor for a way out. In the 20 years since Minnesota enacted the first law allowing charter schools, this hybrid approach to public education has become an increasingly popular escape hatch, especially for black students.

While blacks are 30 percent of the New York City's 1 million public school children, they are 60 percent of the youngsters enrolled in the Big Apple's 125 charter schools. So black parents of charter school students in the city think the NAACP's support of the lawsuit, which was filed last month by the United Federation of Teachers, amounts to an act of racial treason.

But it's not. It is an act of revolution...

Dude needs to change his name to Orwell...Promoting the status quo-- government-run entities with tremendous monopoly power = Revolution? DeWayne, put down the crack pipe and back up slowly.

He recovers a bit by making this distinction:

While revolts bring about reforms...revolution is needed to wipe out a system of oppression...[with charter schools] what they get is steam control — a way to vent their anger, not fix the problem...

But then this:

The NAACP doesn't want an escape hatch for 4 percent of New York City's schoolchildren; it wants a high-quality education for all of them...What the NAACP wants is a revolutionary change, not the incrementalism — and misdirections — [of charter schools].

First sentence = nice assertion. Second sentence = Wickham hitting the crack pipe again.

Six Days in June...well yes, I'm posting this in June-- but that's the book's title

2011-06-14T15:31:00.000-04:00

I have a back-log of books I've read and still want to blog about. Hmmm...back-log of books. Is that what blog stands for?

Before Anthony Weiner stole the headlines, the most important and inflammable recent event was President Obama's remarks about Israel and its borders. Obama wants Israel to return land to re-establish the borders that existed prior to the Six Day War in 1967. This is interesting in many lights:

1.) Why does Obama (or American politicians in general) feel the need to influence an issue like this, especially when it's halfway across the world?

2.) Why would Obama pressure another country to give back land acquired in a recent war in which it was attacked? Can you imagine the U.S. giving back land acquired through wartime?

3.) Why would Obama pressure another country to give back land that was important to their defense, especially in a context where it was still facing a number of related threats?

All of this became more accessible to me by reading Six Days of June by Eric Hammel. The book is a relatively lengthy (400+ pages) but easy read. Along the way, Hammel provides brief bios on many of the region's key players during that time period and afterwards: Arafat, Nasser, Dayan, Sharon, Rabin, Peres, King Hussein, Uri Ben-Ari, etc.

Hammel documents how the Israeli air power and its surprise attack were devastating and instrumental to winning the war so quickly and completely. Along the way, he describes the wars in 1948 and especially 1956-- and their impact on preparation for what would become the war in 1967.

Hummel also credits the vision with which the Israeli armed forces were constructed, emphasizing a "leadership throughout the ranks" approach that encouraged initiative and critical/creative thinking, while avoiding many of the top-down problems in a central command approach (chapters 6-8). In essence, he described a "production" model that reduced transaction costs and allowed quicker movements with fewer "timeouts" (awaiting instructions).

A number of miscellaneous things:

1.) Unintended consequences: I enjoyed the brief vignette on Israeli spy Eli Cohen and the escapades of Egypt's President Gamal Abdel Nasser. Cohen was caught in Syria and even the controlled revelations of his efforts led to a military coup (p. 7). Nasser's bravado-laden bluffs (p. 29-31) and his desire to lead the "Arab Nation" (p. 8's competition with the Syrians) led to all sorts of problems-- by Hammel's accounts, one of the chief catalysts for the timing of the war (earlier than ideal for Israel's enemies).

2.) Attempts at collusion and the free rider problem: Israel benefited to some extent from having multiple enemies that could not coordinate well-- both in a technological sense and in terms of the Prisoner's Dilemmas inherent in group behavior. On the latter, each of their enemies were trying to avoid or instigate action-- what was in their own interests, but detrimental to the overall goal of sacking Israel.

3.) A great example of propaganda gone wrong: Radio Amman reported the death of the Israeli Air Force and uncontested penetration by Egypt into Israel-- all while they were getting their butts kicked.

4.) The many examples of meddling and passivity by the United Nations. It's ironic that they would commit both sins of omission and commission.

5.) Big surprise: The French were far more helpful to the Israelis than the Americans in terms of providing materiel and technology.

Brad Snyder's "interests": school district vs. children, parents and taxpayers

2011-06-10T13:15:00.000-04:00

From Harold Adams in the C-J...

Charter school advocates are crying foul over the New Albany-Floyd County school system’s effort to get around a July 1 mandate to make its vacant school buildings available for their use.

The Floyd school board passed a resolution at its meeting Monday to lease the shuttered Galena and Silver Street elementary schools to its building corporation...wouldn’t have to be made available to charters under a state law passed in April...

Floyd Deputy Superintendent Brad Snyder defended the resolution, which he introduced Monday. “We have our interests to look after...”

Unfortunately, those interests do not coincide with the interests of children, parents, and taxpayers. Brutal...

And then another quote: “We hope that by taking this positive action on behalf of our community, we can remain engaged in protecting the community history and interests of Galena Elementary School."

Snyder is confusing "community" with his "interests" (and those of the school district) and I'm not sure how he's defending the interest of a closed school.

is ObamaCare unconstituional (cont'd)?

2011-06-09T17:56:00.000-04:00

From David Savage (hat tip: C-J)...

A top Obama administration lawyer defending last year's health care law ran into skeptical questions Wednesday from three federal judges here, who suggested they may be ready to declare all or part of the law unconstitutional...in an ominous sign for the administration, the judges opened the arguments by saying they knew of no case in American history where the courts had upheld the government's power to force someone to buy a product.

"I can't find any case like this," said Chief Judge Joel Dubina of the 11th Circuit Court of Appeals. "If we uphold this, are there any limits" on the power of the federal government? he asked.

Good question!

Katyal argued that health care is unique and unlike purchasing other products, like vegetables in a grocery store. "You can walk out of this courtroom and be hit by a bus," he said. And if such a person has no insurance, a hospital and the taxpayers will have to pay the costs of his emergency care, he said.

Unique or different than vegetables? Services are typically more complex than goods. Let's consider education where the govt makes it compulsory up to some arbitrary age. They allow you to pursue schooling services (largely) as you would like. And they subsidize their own schools, forcing those who pay taxes to pony up for others. Similar, but probably a first or second cousin. Let's consider auto insurance, where many (all?) state governments compel you to purchase auto insurance, if you want to drive. This seems like the closest analogy, although it's at the state level.

It's interesting that Katyal acknowledges the if/then potential in this debate: If govt is going to do this (unconstitutional thing), can they do another (unconstitutional thing) to compensate for that?

Katyal argued that Congress could reasonably decide that since all citizens are likely to need medical care at some time in their lives, everyone who can afford it should pay part of the cost.

That's weaker. We're not at all going to use medical care to the same extent and we're not all equally able to pay for "it".

And he said the courts should uphold the law under Congress' broad power to regulate commerce in this country.

Now, that's a weak argument and really dangerous (although it has precedent).

An intro to "Why Jerry Coyne is False" OR why his thinking needs to evolve a lot more

2011-06-09T00:36:00.001-04:00

This is a follow-up to a terrific cartoon and brief reviews of Jerry Coyne's Why Evolution is True and Neil Shubin's Your Inner Fish.

Here, I'm going to spend extended time on Coyne's introduction and chapter 1-- piece by painful piece.

"Evolution gives us the true account of our origins, replacing the myths that satisfied us for thousands of years."

I'd like him to define "true". The term "account" tries to mask but alludes to the vast narrative aspects of his claim (along with the implied comparison to "myths"). And of course, he'll have little or nothing of value to offer on the origins of life-- and nothing close to a full-blown explanation for the origins of human life.

"Why teach a discredited religiously-based theory (myth)...alongside a theory so obviously true?"

I thought religious theories, creationism and intelligent design could not be tested, but Coyne makes the claim that they have been discredited. Hmmm... Then he follows that up with the conflation between evolution which is true and Evolution which is largely narrative and not "true" in nearly the same sense. Later, he makes false claims about ID-- and again, implicitly, asserts that the two can be tested against each other. If he's not careful, he's going to have his Master Evolution debater card taken away.

Later, he sidesteps the claim that Darwinism can predict how things will evolve in the future. I hadn't thought about that previously, but a.) why not?; and b.) theories that come from ex post observations are not nearly as impressive as those that can make ex ante predictions.

He uses "creationism" freely, but doesn't define it (at least early-on). He takes great pains to define aspects of evolution and Evolution carefully. That said, throughout the opening, he conflates evolution as "process" and Evolution as the claim/narrative that "all of life was the product of evolution". Only a moron, a demagogue, or a fundamentalist would do this.

He notes that trouble with evolution (or Evolution) is "spreading to other countries", but he has no explanation for this-- other than the other side is very good at propaganda. Maybe it's because reasonably bright people don't like to be jerked around on basic definitions, Jerry?!

He plays fast and easy with the impact of beliefs about Evolution's worldview, morality, and so on:

"It does not inevitably lead to the dire consequences that creationists always paint...needn't turn you into a despairing nihilist...won't make you immoral...nor need it promote atheism"

Coyne chooses wiggle words to distinguish between the straw man of determinism and the (prospective) incentive effects (tendencies) of holding a belief in the Evolution narrative (over and above belief in the fact of evolution).

Finally, this gem from the end of chapter 1:

"The theory of evolution is more than just the statement that 'evolution happened': it is an extensively documented set of principles that explain how and why evolution happens."

Actually, Jerry, most people do a lot of hand-waving with evolution-- as much as the average theist in pointing to a creator God. (And you've done a good bit of hand-waving yourself, even through chapter 1!) And again, Jerry is confused-- or trying to confuse his readers-- that having a set of principles on how and why evolutionary mechanisms might have done something is not the same as an explanation for how those mechanisms did those things in any given context.

In a word, check out Shubin, but don't waste your coin on Coyne.

an awesome cartoon-- and brief reviews on two books-- about evolution & Evolution

2011-06-09T00:09:00.001-04:00

First, the cartoon-- from Dave Coverley's June 8th Speed Bump...

Second, I finished reading Neil Shubin's Your Inner Fish a week ago or so. (Sam Sloss had recommended it to me.) It's a good read and helpful for those who are a.) those who are open to (interested about) the role that evolutionary mechanisms might have had in the development of life on Earth; and b.) those who want to bolster their a faith in Evolution (the combination of scientific explanation and mostly a scientific-flavored narrative that the mechanisms of evolution are fully responsible for the development of life we see today).

Shubin shares his personal experiences in fieldwork, describes advances in the field, and lays out some of the "missing links". The biggest value-added for me was his description of DNA and how various parts of it are "turned on" in different cells, within each type of animal.

I was hoping for much more on the development of vital and reproductive organs. Of those, Shubin was most compelling on the development of the ear. But why two nostrils instead of one? Why did it take so long to get bodies? The discussion of the eye was unimpressive, but was the best he could do, I suppose. In a word, he talks about why we have X, correlations between Y and X, and how we might have transitioned from Y to X, but he doesn't (can't) explain how and why evolution took us from Y to X.

I appreciate his humility at times. For example: "No sane paleontologist would ever claim that he or she had discovered 'The Ancestor'." And even though he brims with confidence at other times, he comes off well.

Unfortunately, I can't say the same thing about the book I just started (also recommended by Sam &/or Chris, I think): Jerry Coyne's Why Evolution is True. Although I didn't think about it until getting through the introduction: from the title, you can tell that the book is going to be somewhere between simplistic and propaganda. It's not as novel as Shubin's work; it looks like it'll be a primer on evolutionary mechanisms and Evolutionary claims. And it's irritating, because he does the same things he finds irritating in others-- out of ignorance or deceit...and neither is attractive.

I'll pound his introduction and chapter 1 in a separate post (linked here).

cause and effect: sticking to "rule of law" vs. worrying about various and sundry violations of the Constitution

2011-05-25T09:00:00.000-04:00

From my old friend, Andy Horning-- banging on the all-important drum of "rule of law" vs. all of the smaller squabbles that get us excited (e.g., the recent violations of the 4th Amendment in Indiana)...

Today we're mad at some Indiana Supreme Court justices. We want to fight back. That's reasonable.

But what's our goal?

Are we interested in firing a few judges? Reversing a decision? Easing a gun ban or two? Making the Fed show us some numbers? Would that make us happy, prosperous and secure?

As we raise the debt ceiling on our kids before sending them to yet another undeclared war in Pakistan or France or wherever; as we direct ourselves into "Free Speech Zones" and get arrested for selling unpasteurized milk to people who want it...I have to ask a question:

Is this how we want to live? Don't we have any better ideas than to keep nibbling at little abuses here and there? Don't we have a better vision for life than to just keep robbing Peter to pay Paul, and playing Hatfield v McCoy?

I want rule of law under existing constitutions as written. That's all. I want some people to help me ask for it. We've spent the last century asking for, voting for, and getting, the opposite, you know.

The constitutions are proven to work, and they're already law, though we've chosen to ignore and flout them.

Sure, should we actually, finally choose this rule of law we'd still have to keep sharp to make sure that politicians stay on their side of the fence...but it's all black and white and simple. We can read it, tell others about it, paint a picture of how it works, and make others defend the indefensible argument that we can't have laws as written.

Why don't we quit fussing over symptoms and finally cure the disease? We have what we've chosen; we need to choose better. If we want rule of law under existing constitutions as written, we'll have to ask for it. I have a petition, a proposal, and a timeline for compliance here: http://wedeclare.wordpress.com/2011/03/01/713/

Anybody have a better idea?

Of course, we could keep doing what we've been doing…at least for a little while longer. But after decades of trying to attack the symptoms of our growing cancer while ignoring the disease ...we're failing faster and faster every day?

We don't have much time left before we've got no more to lose.

who wants to be a millionaire? retirees...

2011-05-24T08:31:00.002-04:00

That's the expected value of what they'll receive in transfer payments from taxpayers over their lifetimes. Of course, they "contributed" a lot of that-- in paying for previous retirees.

The average rate-of-return on Social Security is really lame. But for Medicare, it's a different story.

Here's John Cogan in the WSJ on this topic, some numbers, and ops for reform...

the perils of direct democracy

2011-05-23T20:21:00.003-04:00

In political economy, Public Choice economists point to the foibles and failings of democracy: the disproportionate power of interest groups in some contexts (the tyranny of the minority); the unjust exercise of power by the general public (the tyranny of the majority); the problems caused by any system of government where people are fond of using power to take others' resources; and so on.

There's an old saying that democracy is the worst form of government, except for all of the others. Or putting it another way: the best form of government is the benevolent dictator; the trouble is finding the benevolent ones.

In April, in a special section, The Economist had some really nice articles on the impact of more direct democracy, as exercised (often famously) in California, starting 100 years ago.

Here's a general, introductory article...

as our special report this week argues, the main culprit has been direct democracy: recalls, in which Californians fire elected officials in mid-term; referendums, in which they can reject acts of their legislature; and especially initiatives, in which the voters write their own rules...This citizen legislature has caused chaos. Many initiatives have either limited taxes or mandated spending, making it even harder to balance the budget. Some are so ill-thought-out that they achieve the opposite of their intent...

Here's an essay on the history of California's democratic experiment...

In this [1911] Californian election voters had to decide on three new types of balloting: referendums, recalls and initiatives. They accepted them all with enthusiasm...Californians thus explicitly chose a path that diverged from the one America’s founders had taken...California is also unique, in America and the world, in treating every successful initiative as irreversible (unless the initiative itself says otherwise). The legislature cannot change it. In effect, this makes initiatives a higher class of law...Direct democracy in California is thus an aberration. It has no safeguards against Madison’s tyranny of the majority...it encourages special interests to wage war by ballot measure until one lobby prevails and imposes its will on all. Madison and Hamilton would have been horrified...

This essay applies the discussion to K-12 education...

And this essay lays out the extent to which voter knowledge (specifically in California) is limited or twisted...

deadly laws vs. deadly liberty

2011-05-17T18:13:00.002-04:00

From Michael Gerson in the C-J-- with the charming title, "Ron Paul's deadly liberty"...

It looks like the C-J is not going to print my (shorter) letter, so I'll go ahead and stick this on the blog. (The C-J also printed a cartoon on Ron-- presumably both the article and the cartoon are meant to try to hurt Rand Paul.)

Gerson cites Paul's second-tier status in the GOP Presidential race and wrestles with whether he should be in the first tier, given his poll numbers and fund-raising. Then, he starts poking at Paul's support for drug legalization:

The freedom to use drugs, he argued, is equivalent to the freedom of people to “practice their religion and say their prayers.” Liberty must be defended “across the board.” “It is amazing that we want freedom to pick our future in a spiritual way,” he said, “but not when it comes to our personal habits.”

This argument is strangely framed: If you tolerate Zoroastrianism, you must be able to buy heroin at the quickie mart. But it is an authentic application of libertarianism, which reduces the whole of political philosophy to a single slogan: Do what you will — pray or inject or turn a trick — as long as no one else gets hurt.

First, give Gerson credit for understanding and communicating Libertarian philosophy and application.

Second, Gerson's reference to Zoroastrianism seems strategic. Let's go with Islam instead. For the Christian, which is more "deadly": false religion or hitting a crack pipe? For the neo-conservative (with their belief in Islam as the primary cause of terrorism), which is more dangerous: Islam or smoking weed?

Gerson points to widespread drug use and addiction "in some neighborhoods" and "used needles" in parks. The funny thing? This is what we have under the criminalization of drugs! Gerson points a finger at legalizers. But his real beef is with the government's inability to enforce drug laws and maintain govt-controlled land-- to keep people and public parks clean.

Gerson raises Paul's huge practical question: “How many people here would use heroin if it were legal? I bet nobody would..." Gerson believes that use and addiction would increase by a staggering amount, well beyond what we have now. Perhaps. But Paul is asking the correct question: How many MORE people would use and abuse drugs with legalization?

Gerson also conflates private morality with public policy-- as well as the decision to allow freedom with condoning behavior. Jesus understood the difference-- most poignantly, in the story of "the woman caught in adultery" (Jn 8). He didn't chuck rocks at her, but also encouraged her to leave her life of sin. For Gerson, if you're not chucking rocks, then you just don't care.

Gerson tries to get on a moral high horse about the plight of children in this context. But he fails to consider the impact of drug laws on kids. How many kids are tempted to join gangs to sell cigarettes and alcohol? How many kids are tempted to take drugs because they are easily used to traffic them? And beyond the children, what about the destabilization of foreign countries caused by our drug policies? What about prison over-crowding and the early release of violent offenders to make room for those who use drugs?

At the end of the day, there are trade-offs between "deadly laws" and "deadly liberty". The trade-offs should be discussed heavily not dismissed lightly. For philosophical and practical reasons, which will you choose?

some numbers on PP (and some plagiarism to boot)

2011-05-16T17:44:00.004-04:00

Excerpts from Margie Montgomery's letter in the C-J, responding to a letter/op-ed by Kimberly Greene in the C-J. Interestingly, Greene's letter is no longer available on their website, perhaps because it is involved in some form of plagiarism. You can see "her" letter here as well-- in an Anchorage, Alaska newspaper.

Is it possible that one is an “extremist” to resent her tax dollars being used to abort at least 5.3 million babies since 1970; or in 2009, Planned Parenthood's aborting 332,278 babies? Defunding Planned Parenthood (PP) with our tax dollars wouldn't mean denying women cancer screening, contraception and sexually transmitted disease (STD) testing, because in addition to the tens of thousands of U.S. doctors and hospitals that provide these services, there are 1,048 federally qualified health centers in the U.S. doing the same...

Planned Parenthood is immensely wealthy in its own right and does not need tax dollars to continue functioning. According to its latest published annual report, PP has nearly $1 billion dollars of net assets (almost$1.2 billion in assets and $202.6 million in liabilities)...

In 2009, the group made only 977 adoption referrals and cared for only 7,021 prenatal clients, but performed a record 332,278 abortions...Planned Parenthood recently made plain the centrality of abortion to its mission by mandating that every one of its affiliates have at least one clinic that does abortions within the next two years...

When women testify in favor of tightening safety standards at clinics, Planned Parenthood fights them. And despite the fact that 88 percent of Americans favor informed-consent laws that provide information about the risks of, and alternatives to, abortion for women, Planned Parenthood opposes these efforts and works to keep women in the dark. And tragically, in some instances, Planned Parenthood has refused to cooperate when law-enforcement officials have sought information to help girls they believed to be victims of child rape or molestation...

regulating and monitoring abortion clinics?

2011-05-16T17:35:00.003-04:00

Virginia has decided to regulate abortion providers like hospitals (hat tip: Christianity Today). Especially for fans of business regulation, this would seem to be an appropriate move.

And you'd hope for more from the medical profession in self-policing. But here's the story (from the AP's Kathy Matheson) of Dr. Kermit Gosnell who performed abortions and endangered the lives of many women in a "squalid" Pennsylvania clinic. Bad enough, but worse still: he was not reported by most of the doctors who cared for the patients whose procedures he had botched.

Women went to Dr. Kermit Gosnell to end their pregnancies. Many came away with life-threatening infections and punctured organs; some still had fetal parts inside them when they arrived at nearby hospitals in dire need of emergency care.

Doctors at the University of Pennsylvania Health System, which operates two hospitals within a mile of Gosnell's squalid abortion clinic in West Philadelphia, saw at least six of these patients- two of whom died. But they largely failed in their legal and ethical duties to report their peer's incompetence, according to a grand jury report...

Prosecutors described Gosnell's clinic as "a house of horrors," where viable babies were killed with scissors, fetal remains were kept in jars and freezers, and dirty medical equipment was operated by unlicensed, often untrained and unsupervised employees. Gosnell himself was never certified in obstetrics and gynecology, only family practice.

Gosnell, 70, is jailed without bail and charged with eight counts of murder in the deaths of one patient and seven viable babies. Authorities say he also routinely maimed his clients, sometimes leaving them sterile and near death...

lackluster recovery (cont'd)

2011-05-11T14:10:00.003-04:00

When will the Keynesians (and more of the American people) learn?

Here are the WSJ editorialists...

Another week, more evidence of the lackluster economic expansion. This time the message came in yesterday's jobs report for April, which revealed more modest job creation. That's surely better than nothing, but it's well below what you'd expect nearly two years into a recovery after a very deep recession. Americans should not have to accept this as the "new normal."

The good news is that private payrolls jumped by 268,000 jobs, the third month in a row of gains greater than 231,000. The jobs came across a variety of industries...

The private gains offset the loss of 24,000 government jobs, the sixth consecutive month of such declines. This is also good news. Propped up by the Obama stimulus, public payrolls are bloated and unsustainable....

The disappointing increase in the overall jobless rate—to 9% from 8.8%—reflects in part an increase in the number of Americans seeking work, which is a sign of confidence that they believe they may find a job. The real story here is the failure, after 21 months of growth, to cut the jobless rate more rapidly from its 10.1% peak in October 2009.

On the plus side, the number of Americans who are jobless for six months or longer fell by 283,000, though they are a still worrisome 43.4% of all the jobless. More troubling is the big jump in April in the jobless rate for blacks (0.6% to 16.1%), Hispanics (0.5% to 11.8%) and teenagers (0.4% to 24.9%).

As ever, slow growth hurts the least skilled the most, and that usually means the young or least educated. Even as many manufacturers report difficulty finding skilled workers for high-paying jobs, the bottom rung of the economic ladder remains out of reach to hundreds of thousands...

Sara Murray in the WSJ on the growth in payrolls, despite the higher unemployment rate...

So far this year, the economy has added 768,000 jobs and the Labor Department revised up the prior two months to show job gains were stronger by a total of 46,000.

Still, the economy has a massive jobs hole to fill. As of April, there were 13.7 million Americans out of work and another 8.6 million who wanted to work full-time but could only find part-time jobs...

And Sara Murray again in the WSJ on gender-specific aspects of the recession and now the recovery-- in a word, men struggled more but are recovering quicker...

The recent recession was labeled by some a "man-cession," because of sharp employment cuts in male-dominated fields...

The unemployment rate for men, on average, was 10.5% last year. By April it had declined 1.1 points to 9.4%...Joblessness among women was less common: Their unemployment rate was 8.6% on average last year. But...by April, the unemployment rate for women had fallen just 0.2 points to 8.4%.

A large part of the problem is that women are disproportionately represented in state and local governments—and that is where many jobs are being cut now....

About 18.2% of employed women work in the public sector. They are nearly 50% more likely to hold public-sector positions than men, according to the Labor Department....

deadly laws vs. deadly liberty

2011-05-11T13:11:00.007-04:00

From Michael Gerson in the C-J-- with the charming title, Ron Paul's deadly liberty...

Gerson cites Paul's second-tier status in the GOP Presidential race and wrestles with whether he should be in the first tier, given his poll numbers and fund-raising. Then, he starts poking at Paul's support for drug legalization:

The freedom to use drugs, he argued, is equivalent to the freedom of people to “practice their religion and say their prayers.” Liberty must be defended “across the board.” “It is amazing that we want freedom to pick our future in a spiritual way,” he said, “but not when it comes to our personal habits.”

First, give Gerson credit for understanding and communicating Libertarian philosophy and application.

Update: A nice article by Jack Hunter in American Conservative Magazine, drawing an analogy between drug legalization and abolishing the minimum wage (hat tip: Darrell Dow)

Home Mortgage Interest: the most over-rated deduction

2011-04-18T10:19:00.002-04:00

My annual April op-ed piece on taxes, appearing in newspapers across Indiana...

It’s that time of the year again. Some people filed their 1040 tax forms last January, received their refunds and are excited that they let the government keep their money (interest-free) for months. Others have procrastinated and are filing their taxes at the last minute. Few taxpayers have noticed their “payroll tax” (FICA) - even though it probably takes more of their money (unless they earned a six-figure income). And most people believe that the world is a better place because of the Home Mortgage Interest Deduction (HMID).

Economists are interested in the distortions caused by subsidies in the tax code. Subsidies change incentives, so that people end up doing more of the activity being subsidized - whether it’s attending college, purchasing health insurance through one’s employer, or buying a bigger house. Such policies may be ultimately desirable. But they are “socially inefficient” - by definition - because they take resources from a more productive part of the economy and encourage people to do what has become “personally efficient.”

The HMID is projected to cost $132 billion next year. Even in years without budget concerns, that’s a lot of money. Now, some will say that this subsidy is important for the housing sector in particular and the economy in general. They point to the “multiplier effect” of jobs created by the housing sector - from construction workers to input suppliers, from those who earn the money to those who benefit when that money is saved, given away and spent on consumer goods.

But the same could be said of other ways to use $132 billion. For example, we could put the same money into infrastructure and create jobs, while improving roads and bridges. So, why would we think that spending the money for the HMID is better than alternative uses of the same money?

Aside from efficiency, there are also important questions of “equity” or fairness. One who receives a subsidy is likely to see that subsidy as “fair.” But if we’re trying to be more objective, what can be said about the fairness of the HMID?

Beyond its overall cost, the subsidy provides a disproportionate benefit to the wealthy. Intuitively, this is relatively easy to understand. One has to itemize deductions to get it. From there, the gain is only the amount of the itemized deduction over the standard deduction. In 2010, the standard deduction for married couples was $11,400. So, unless your mortgage interest and other deductions (most notably, charitable contributions, state-local income taxes and property taxes) exceed that amount, your mortgage interest does not reduce your taxable income at all.

For example, if a married couple has mortgage interest of $5,000 and total deductions of $12,000, then they only get the extra $600 over the $11,400 standard deduction. From there, you multiply the $600 reduction in taxable income by the relevant marginal tax rate (MTR). If they’re in the 15 percent tax bracket, then the extra $600 in deductions would be worth $90 in lower taxes. It’s difficult to get excited about saving $90 in taxes by giving a bank $5,000.

Both the amount of itemized deductions and the MTR typically increase with income. So it follows that the wealthier should be expected to benefit a lot, while the policy does little for the middle class and nothing for the poor.

Let’s look at the numbers. Some states benefit more than others. In 2008, 27 percent of Americans claimed the HMID for an average deduction of $3,279. But use of the HMID ranged between individual states, from Maryland’s 38 percent to North Dakota’s 15 percent. And average HMID deductions ranged from California’s $5,520 to North Dakota’s $1,222. (In Indiana, 33 percent claimed the HMID with an average deduction of $3,337.)

A recent study by the Urban Institute focused on the net tax benefit of the subsidy. Among Whites, 26.4 percent benefit from the HMID, by an average of $632. Among African-Americans, only 14 percent benefit from the subsidy, by an average of $277. Looking at income levels, the average annual benefit of the HMID is $4,466 for the top 5 percent of income earners; $2,639 for the top 20 percent; $215 for the middle 20 percent; and $2 for the lowest 20 percent.

It’s difficult to imagine why one would be really excited about this policy - rather than lower, overall taxes or lowering the deficit - unless one is wealthy and has a mortgage on an expensive home. But we should expect our politicians to rise above such selfish interest and to enact policies that are more efficient and more equitable.

Lincoln on equality between whites and blacks

2011-04-13T13:52:00.002-04:00

Lincoln in 1858 on the question of equality between the races (hat tip: Tom DiLorenzo):

"I will say then that I am not, nor ever have been in favor of bringing about in any way the social and political equality of the white and black races, that I am not nor ever have been in favor of making voters or jurors of negroes, nor of qualifying them to hold office, nor to intermarry with white people; and I will say in addition to this that there is a physical difference between the white and black races which I believe will forever forbid the two races living together on terms of social and political equality. And inasmuch as they cannot so live, while they do remain together there must be the position of superior and inferior, and I as much as any other man am in favor of having the superior position assigned to the white race."

Jenkins' The Lost History of Christianity

2011-04-07T20:23:00.006-04:00

Jenkins is referring to the "lost history" of Christianity in Africa and Asia vs. Europe and America. The cover photo is a German artist's map of the 16th century's (primary) known world with three flower-petal-shaped land masses depicting Europe, Asia, and Africa-- AND with Jerusalem at the center of the world.

Jenkins notes that Christianity's history has featured both growth and decline. In contrast, the common wisdom is that Christianity was mostly European after the 5th century-- and has grown quite a bit since the 14th century, largely in Europe and America. The last part of this is correct, but not for the reasons or timing usually imagined: "Christianity became predominantly European not because this continent had any obvious affinity for that faith, but by default: Europe was the continent where it was not destroyed." (3)

As a result, Jenkins argues that "We can't understand Christian history without Asia-- or, indeed, Asian history without Christianity." He chronicles some of the many amazing successes of this Christianity-- in terms of evangelism, translating the Scriptures into native tongues, Biblical scholarship, and weighty spiritual experience and disciplines.

Perhaps this success shouldn't surprise us, since Jerusalem was closer to the "seemingly exotic territories of Central Asia than it is to France...If early Christians could reach Ireland, there was no logical reason why they should not find their way to Sri Lanka." (53)

Jenkins provides numbers as well. As late as the 11th century, Asia had about 1/3 (17-20 million) and Africa 1/10th (5 million) of all Christians (4). And at that point in history, the Asia/Africa wings of the Church were stronger and better established. He argues that they were still "the leaders" even at that late date.

Even in 1900, Christians were still 11% of the population in the Middle East-- quite a bit more than other notable, religious minorities today (American Jews' 2%; European Muslims' 4.5%). Christians comprised 15-20% of the population of Asia Minor-- and half of Constantinople's population in 1911 (141, 152-154).

That said, by the 20th century, in relative terms, non-European/American Christians had shrunk as a proportion of all Christians, given relatively low population in the Middle East vs. elsewhere. In the 20th century, the Christian population in the Middle East increased from 4.4 to 9 million, but given big population growth that century, was reduced from 10% to 3% of the overall population (168).

The Church became predominately European in the Middle Ages, starting in the 14th century. Part of this was its rise in Europe; part of this was its decline elsewhere. For example, Asian Christians fell from 21 million to 3.4 million between 1200 and 1500 (24). Overall, Asian Christian communities went from majority/dominant (or at least prominent), to minority status, and then eventually, many were eliminated. Why the decline? A combination of "positive" factors, mild negatives, and brutal negatives.

As Christianity declined, Jenkins argues that Christians and Muslims mostly got along. Christians certainly endured modest discrimination and persecution-- but not enough to cause big trouble and arguably, helpful for strengthening faith and building community. But at times, the pressures and violence increased dramatically, leading to conversion, migration or death. An interesting aspect of this was assumed foreign policy intrigues-- as Christians in Asia were assumed to be in cahoots or at least sympathetic to attacking Christians from Europe (157).

There were also a number of "positive" attractions to Islam. Jenkins points to a number of subtle cultural/political influences: Muslim buildings were more likely to be rebuilt after wars and plagues; Christian language was perceived as as old/archaic; they were surrounded by a Muslim landscape and architecture; the coins depicted Muslim leaders and themes; and the dominant Muslim culture "looked successful".

Surprisingly, another allurement was that Christianity and Islam looked much more similar early-on (31a). This resulted from and resulted in various forms of syncretism. In Islam's early days, there were considerable similarities in belief and practice; perceived overlap in the Scriptures (the Quran seems to have been inspired in part by the OT); and even, shared shrines and saints! Islam was often seen as a heresy of Christianity rather than its own religion (184-187, 194-195, 201-202, 202-205).

The Christians were also disunified-- as European Christians sought to lord it over their Eastern brethren. In fact, they often preferred Muslim to Catholic governance: "Better the Sultan's turban than the Cardinal's hat!" (150)!

Jenkins describes the decline as a "ratchet effect"-- similar to "punctuated equilibrium" in Evolution (211). Instead of gradual decline, there would be a steady-state with occasional, steep drops. Jenkins notes that the Christian populations became more vulnerable-- in terms of quantity and "quality"-- as they were increasingly fragmented. He also depicts some of the declines country-by-country-- e.g., Iraq dropping from 5-6% in 1970 to 1% now (169). Jenkins also gives considerable space to the Armenian Genocide (161-163)-- a little-known but staggering pre-cursor for what would follow-- for Christianity in particular and the world in general-- throughout the 20th century.

Jenkins notes that two factors improved the prospects for survival-- both of which explain the amazing story of the flourishing Copts in Egypt: geographical protection (236-240) and getting into the roots of the culture (35, 230-233).

Interestingly, Christianity is again moving toward the global South today-- with a meteoric rise in South America, China, and Africa in particular. Why is all of this important? For one thing, both the past and the future impact one's eschatology (the trajectory of human history and the nature/timing of God's interventions within history). The dominant evangelical eschatology is pre-millennial-- where things get worse and worse, and then Christ comes to wrap things up. But an understanding of the decline and growth of Christianity in the past-- and its worldwide growth now-- point to the possibilities (probabilities?) of a-millennialism (history goes back and forth between good and evil) and post-millennialism (where God's Kingdom expands more or less over world history).

The book is an easy/pleasant read. If you want to know more about Christian history, check it out!

SchansBlog

GOP and Dems struggle with Econ 101

more confusion on Romney and tax percentages paid

Obama's SOTU and ignorance on economics and tax policy

Romney and Buffett's "tax rates" (vs. the little people)

the numbers on Romney vs. the teacher

my review of Entrepreneurship and Religion

science in theory vs. practice

research on the impact of school choices on Christian children

three articles on education

OJCPSB: Occupy JCPS Buses

more-on Keynesian failures

homeschooling books for sale

the sad case of Jon Corzine and the difficulty in govt regulation of the market (in reality vs. wishful thinking)

The Big Short

the difference/divorce between worker pay, worker compensation, and the cost of hiring workers

three interesting articles on K-12 education and budget woes

Meet the (Birth)Parents

Post Office woes: What to do with a govt-run, monopolistic, delivery dinosaur?

Curtis Morrison ode to OWS and the Tea Party

income tax reform

sheltering kids (too much?)

Dionne vs. Logic; Buffett vs. Clinton

"a warm but not boisterous reception" for Obama and his latest "stimulus"....err, "jobs pitch"

"uncharitable" things to say about Rick Perry's charitable contributions?

five myths about Mormonism?

just another drug warrior

the limited wisdom of Elizabeth Warren

bringing a spoon to a gun fight

the efficiency of Medicare vs. private insurance

A Modest Proposal for Changing Higher Education

McGovern critiques Obama

Obama vs. the economy in general and the wealthy in particular

"Let 'em fail"?

Social Security, fraud, and Ponzi schemes

Norquist's "Leave Us Alone"

Sherman-Minton down...long-run consequences?

Eugene Peterson on the Lord's Prayer

job growth = 0 in August

This WSJ article, by Sudeep Reddy, has some good info, including a terrific comparison to other recessions.

Thank you to President Bush, Congress, and especially President Obama-- friends of the working class-- and to all Keynesians!Choose your favorite, famous related movie line: a.) thank you sir, may [we] have anotherb.) you'll get nothing and like it!c.) other (make suggestions)

our trip to Bardstown

intro to Exodus

our trip to NY

finishing up my review of Coyne's "Why Evolution Is True"

Moses: America's Prophet

Wickham's Folly: revolution without revolutionary change

Six Days in June...well yes, I'm posting this in June-- but that's the book's title

Brad Snyder's "interests": school district vs. children, parents and taxpayers

is ObamaCare unconstituional (cont'd)?

An intro to "Why Jerry Coyne is False" OR why his thinking needs to evolve a lot more

an awesome cartoon-- and brief reviews on two books-- about evolution & Evolution

cause and effect: sticking to "rule of law" vs. worrying about various and sundry violations of the Constitution

who wants to be a millionaire? retirees...

the perils of direct democracy

deadly laws vs. deadly liberty

some numbers on PP (and some plagiarism to boot)

regulating and monitoring abortion clinics?

lackluster recovery (cont'd)

deadly laws vs. deadly liberty

Home Mortgage Interest: the most over-rated deduction

Lincoln on equality between whites and blacks

Jenkins' The Lost History of Christianity

Thank you to President Bush, Congress, and especially President Obama-- friends of the working class-- and to all Keynesians!

Choose your favorite, famous related movie line:
a.) thank you sir, may [we] have another
b.) you'll get nothing and like it!
c.) other (make suggestions)