UK's Fair Share Experience

The President and the First Lady are running around the country trying to sell the old canard that we must make The Rich pay their Fair Share of income tax by raising marginal tax rates. Fortunately we have a very recent glimpse into what happens when you do this. One of the last gasp acts of the Labor government in the UK was to do exactly what Barack and Michele are asking for. They raised the highest marginal tax rate from 40% to 50% on The Filthy Rich (anyone earning £150,000 a year). What happened? Tax collections from the group affected by this rate increase are actually down 5%.

Now this probably will neither shock nor bother the President. Raising revenue isn't his objective. Appearing to mete out punishment to the successful is. He admitted this four years ago to Charlie Gibson of ABC in talking about raising capital gains taxes:

GIBSON: And in each instance, when the rate dropped, revenues from the tax increased; the government took in more money. And in the 1980s, when the tax was increased to 28 percent, the revenues went down.
So why raise it at all, especially given the fact that 100 million people in this country own stock and would be affected?
OBAMA: Well, Charlie, what I've said is that I would look at raising the capital gains tax for purposes of fairness. 

In other words, an increasing budget deficit is not a problem if you can pander to the ignorant who think raising marginal tax rates is "fair". The phrase "Cutting off the nose to spite the face" comes to mind here.

This passes for leadership these days.

A Disabled Nation

As of January, the federal government was mailing out disability checks to more than 10.5 million individuals at a record cost of $200 billion a year. And the rate of increase is growing.

Change in the Ratio of People on Disability to the Labor Force in 1960

Given the advances in medical technology is it likely the the percentage of people who are actually unable to work is increasing that much faster than it was 50 years ago? Or is it more likely that an increasing  number of Americans find disability benefits more attractive than actually working?

Teach a man to fish, and he'll never starve. Teach a man that he'll get fresh fish every day without having to cast a net, and he'll gladly sit on the shore watching you fish.

The Alfred E. Neuman Budget

From the Office of the President, the official 2013 budget Table S-15.
This chart shows the total Federal Debt projected if the budget is adopted.

That's right. The President's budget (the one he calls "fiscally responsible") projects over $26 Trillion in debt ten years from now. And unless the economy grows at more than 5% annually for the next ten years (which has never, ever happened), that means that our debt:GDP ratio will also continue to grow. The budget doesn't say exactly who is going to lend us another$12 Trillion, but as Alfred. E. Neuman said each month from the cover of Mad Magazine, "What, me worry?"

Green Jobs Meets Bayes

Below is data from the Employment and Training Administration  (Department of Labor) relating to the grants that were provided under the “Stimulus” bill to train workers for “green” jobs.  It compares estimates that were made to justify the grants versus results actually obtained. Bayesian analysis would suggest that this data should alter Congress’ expectations about such programs. Think it will? 

Consider your own job. How long do you think your employer would continue to pay you to do projects that never even came close to the projections you gave?