McCain and Graham are big government statists who happen to be Rs.
Is it just me or do McCain and his Boy Wonder sidekick Sen. Lindsey Graham (R-S.C.) bear a growing resemblance to Mermaid Man and Barnacle Boy from Sponge Bob Squarepants? Like the version of the GOP they represent, their best days are behind them. Which may well be good news for just about everybody else.
If GOP members of Congress have finally (and mostly reluctantly) signed on to the reality of sequester cuts, the country’s Republican governors seem a lot more bent out of shape at the idea of losing various crumbs from federal coffers.
51% of Households Paid no Federal Income Tax for 2009
[I]f government is “free” for a growing number of people, that may lead them to support policies that make government even bigger. More generally, this could be another step toward becoming a failed state like Greece, with too many people riding in the wagon and not enough people pulling the wagon.
The chart [above] depicts the American electorate divided not into two groups – the 1% vs. the 99%, but four groups – the 1% super-rich, then 20% representing government workers, 46% representing citizens who either pay zero taxes or negative taxes (ala the “earned income credit”), and the remaining 33% who are neither super-rich, government employees, or not paying taxes. One might term this group the forgotten 33%, because no special interest will speak for them. They have neither the numbers nor the financial wherewithal to decisively influence elections.
Barack Obama’s win has a potentially huge effect on policy. The current budget negotiations will affect the level and direction of government spending and on the mix of taxes paid by different groups of Americans. We can guess that a President Romney would have fought hard against upper-income tax increases. Other areas of long-term impact include the government’s stance on global warming, foreign policy, and the likelihood that Obama will nominate new Supreme Court justices who will uphold the right to abortion announced in Roe v. Wade.
When it comes to public opinion, the story is different. The Democrats may well benefit in 2014 and 2016 from the anticipated slow but steady recovery of the economy over the next few years—but, as of November 6, 2012, the parties are essentially tied, with Barack Obama receiving 51% of the two-party vote, compared to Mitt Romney’s 49%, a split comparable to Al Gore’s narrow victory in 2000, Richard Nixon’s in 1968, and John Kennedy’s in 1960. Over the next few months, you will be hearing a lot about Obama’s non-mandate, and rightly so.
But here I want to talk about a slightly different split of the voting-eligible population: the approximately 30% who voted for Obama, the nearly identical number who chose Romney, and the 40% who did not vote at all or who voted for minor-party candidates. . . .
The key to understanding the 2012 election is simple: A huge slice of the electorate stayed home.
The punditocracy — which is more of the ruling class than an eye on the ruling class — has naturally decided that this is because Republicans are not enough like Democrats: They need to play more identity politics (in particular, adopt the Left’s embrace of illegal immigration) in order to be viable. But the story is not about who voted; it is about who didn’t vote. In truth, millions of Americans have decided that Republicans are not a viable alternative because they are already too much like Democrats. They are Washington. With no hope that a Romney administration or more Republicans in Congress would change this sad state of affairs, these voters shrugged their shoulders and became non-voters.
3) In Fiscal Year 2011, the federal government collected $2.303 trillion in tax revenue. Interest on the debt that year totaled $454.4 billion, and mandatory spending totaled $2,025 billion. In sum, mandatory spending plus debt interest totaled $2.479 trillion… exceeding total revenue by $176.4 billion.
For Fiscal Year 2012 which just ended 37 days ago, that shortfall increased 43% to $251.8 billion.
In other words, they could cut the entirety of the Federal Government’s discretionary budget– no more military, SEC, FBI, EPA, TSA, DHS, IRS, etc.– and they would still be in the hole by a quarter of a trillion dollars.
4) Raising taxes won’t help. Since the end of World War II, tax receipts in the US have averaged 17.7% of GDP in a very tight range. The low has been 14.4% of GDP, and the high has been 20.6% of GDP.
During that period, however, tax rates have been all over the board. Individual rates have ranged from 10% to 91%. Corporate rates from 15% to 53%. Gift taxes, estate taxes, etc. have all varied. And yet, total tax revenue has stayed nearly constant at 17.7% of GDP.
It doesn’t matter how much they increase tax rates– they won’t collect any more money.
5) GDP growth prospects are tepid at best. Facing so many headwinds like quickening inflation, an enormous debt load, and debilitating regulatory burdens, the US economy is barely keeping pace with population growth.
The German-Style Board Game Revolution – “A Euro-style game fan I spoke to referred to Monopoly, Life, and the like as ‘Amero-trash games.’ Settlers of Catan originated in Germany, as did most of the rest of its ilk; Germans are famously crazy about board games, and mainstream German magazines often review games along with new movies and music releases.”
LAUSD Principal Focuses On Real Miramonte Criminals: The Children – “One of the many privileges of having kids in the Los Angeles Unified School District is the accelerated education they get in official corruption, the stupidity of grownups, union strong-arming and many other topics – any topics other than reading, writing and arithmetic, that is.”
Why Italian Moms Are the Best – “Canadians make great moms. So do Ukrainians. Jewish moms can get in a ring with anyone, as can the Norwegians, the Tasmanians and the Kenyans. It all depends on your perspective. … Speaking from my own experience, I would argue that the best mothers are Italian-Americans, in part because they are warm and affectionate, but mostly because of the manicotti.”
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Obama’s Budget Proves He Should Not Be Reelected – “The [proposed FY2013] budget is as cynical an affair as last year’s offering, which was defeated 97-0 in the Senate – an act of rare bipartisan cooperation. Before we celebrate that moment of sanity, however, we recollect that the Senate has not passed a budget in more than 1,000 days, though they are required by law to do so. The White House blames this dereliction of duty on intransigent Republicans (a charge most recently leveled by Budget Director Lew over the weekend) but in reality all that is needed is a simple Senate majority to pass a budget, which the Democrats have. All this skirmishing is but B-rated play-acting. Informed citizens should be furious that the real issues clouding our future are not even addressed by our president. The crisis in our country is two-fold: a rising number of people receive ever-increasing assistance from the government. At the same time, fewer Americans are paying taxes. The inevitable outcome is a widening gap between revenues and outlays: the deficit. The recession has accelerated the problem.”
Loopholes Allowed for Long Vegas Vacation – “In recent years, the lawmakers and staffers lucky enough to snag an invite to the annual Consumer Electronics Show were largely forced by House and Senate rules to limit their fun in Las Vegas to one day. But through the clever use of loopholes, this year, about a dozen Members and staffers (and family) were able to convert the convention into a four-day junket, with the Consumer Electronics Association still picking up the bulk of the tab. And it’s all within the rules.”
What You Need to Succeed–and How to Find Out If You Have It – “Whether you succeed at work may depend on many factors—intelligence, empathy, self-control, talent and persistence, to name a few. But one determinant may outweigh many of these: how you perceive those around you. New research suggests that your own ability to get things done-not to mention your success in non-work relationships-is highly correlated with how you see others. Are your coworkers capable and kind, or are they, dare I say, incompetent jerks? It turns out that such opinions are tied to a key component of achievement called psychological capital, a mixture of efficacy (self-confidence), resilience (you believe you can bounce back from setbacks), hope (you believe you can achieve your goals) and optimism (you expect good things to happen in the future). As a concept, psychological capital reflects our capacity to overcome obstacles and push ourselves to pursue our ambitions. Not surprisingly, scoring high on this measure is linked to markers of success: being promoted, winning awards, popularity with peers, stability of marriage and even longevity.”
Success in 7 Short Steps – “[C]ultivate a positive mindset through rituals and goals, say University of Nebraska management scholars Fred Luthans and Peter Harms. Here’s how: 1. Write a gratitude letter. 2. Seek out the good things in life. … 4. Put problems in perspective. … 6. Do nice things for others. … 7. Spend money on experiences, not objects.”
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The Boy Who Played With Fusion – “Shortly after his 14th birthday, Taylor [Wilson] and [Bill] Brinsmead loaded deuterium fuel into the machine, brought up the power, and confirmed the presence of neutrons. With that, Taylor became the 32nd individual on the planet to achieve a nuclear-fusion reaction.”
The Admiring Ignorant – “It’s 12 years later now; if things go according to plan, I will soon earn tenure. And I’m wondering now if the 23-year-old master’s-degree student was perhaps uncharitable toward someone who might have known some things he didn’t. In terms of an academic lifetime, I’m still a relative newborn, yet I feel like I know a bit more about the frustration and exhaustion that might cause a college professor to wonder if he had wasted his life. I once received a paper wherein the student claimed that ‘John Lenin’ had used his career in the Beatles as a stepping stone to seize control of Russia; last year, I read a paper that advanced the idea that ‘back in the day’ – by which the writer meant the 1990s – people didn’t commit adultery, and homosexuality didn’t exist.”
A failure of imagination put Metro on wrong track – “Believers in central planning should take a look at Washington’s Metro rail transit system. While they will find many things to like, they will also see examples of how central planners-and especially rail transit planners-can get things disastrously and expensively wrong. … The assumption of Metro planners was that jobs would continue to be heavily concentrated in downtown D.C. So there is no station serving Tysons Corner in Northern Virginia, which has become the largest office center between downtown Washington and Atlanta. Joel Garreau, in researching his book ‘Edge City‘ on Tysons and similar clusters, asked Metro planners why they didn’t put a station there. The reply: We never thought there would be any development there. Suburbs are for houses. But Northern Virginia lawyer named Til Hazel, who handled land acquisition cases on the Capital Beltway, figured it out. He bought big parcels in the triangle between the Beltway, Leesburg Pike and Chain Bridge Road, and made millions developing Tysons.” For more on Metro, see Unsuck DC Metro.
The Forgotten Man of the Tax Debate – “The skills that make successful businessmen and investors are not spread equally among the population, and they certainly don’t coincide with the ability to win elections. Better to encourage investment by leaving cash in the hands of those who know how to use it. Even if tax rates have no incentive effects (although I’m sure they do), cash in the form of retained earnings is important, and too often overlooked. My family businesses don’t add much to the overall economic prosperity of our nation. They’re small, not terribly profitable, and are hardly giant engines for job creation or on the cutting edge of innovation. They do, however, employ nine family members throughout the year, with another dozen or so employees during the busy season. Without sensible tax rates on both labor and capital, we can’t build the equity we need to expand in good times and survive the bad times. That’s why tax rates matter. Since our situation is multiplied tens of thousands of times across our economy, from family restaurants to small trucking firms to the corner bodega, discussions of fairness, questions of incentives, and the proper rate of taxation should never neglect cash left in the hands of businesspeople. You can be sure that cash money is foremost in the minds of the people who are actually making the economic decisions that drive our economy.”
Doll ‘protesters’ present small problem for Russian police – “Russian police don’t take kindly to opposition protesters – even if they’re 5cm high and made of plastic. Police in the Siberian city of Barnaul have asked prosecutors to investigate the legality of a recent protest that saw dozens of small dolls – teddy bears, Lego men, South Park figurines – arranged to mimic a protest, complete with signs reading: ‘I’m for clean elections’ and ‘A thief should sit in jail, not in the Kremlin’.”
The term Revenue refers to income that is received by the federal government. (The executive branch also uses receipts as a term for revenue.) Revenue may be raised from a variety of different sources, although they primarily stem from individual income taxes, social insurance taxes, corporate income taxes and excise taxes. Revenue may additionally be raised by fees, tariffs, fines, bequests and gifts. Tax expenditures refer to revenues that are foregone as a result of an exemption, deduction or other exception.
Whenever legislation is enacted by Congress that provides the legal authority for an agency to spend money, it is said to be providing budget authority. The most well known form of this type of legislation that provides budget authority is the annual appropriations act. Agencies are authorized to enter into obligations by budget authority.
An obligation is any form of action that establishes a financial liability on the part of the federal government. This could include entering into a contract, submitting purchase orders, etc. Anytime an obligation is liquidated, the result is an outlay. An outlay represents the actual payment of the obligation. This commonly occurs through electronic fund transfers or in some cases, the issuance of a check or disbursement of cash. The stages in which obligations and outlays take place are known as the spending pipeline. The spendout rate refers to the rate at which funds are spent. A spendout rate can vary from one account to another as well as from program to program.
While Congress is able to exercise direct control over budget authority, its influence regarding obligations and to some degree, outlays, is indirect. It is federal agencies that ultimately determine outlay levels.
Two terms frequently associated with the federal budget include surplus and deficit. Surplus refers to an excess of revenues over outlays, while a deficit is an excess of outlays over revenues.
Congress and the president utilize baseline budgeting to analyze budget policy choices. A baseline is a set of projections for future spending and revenues that results in a surplus or deficit based on assumptions made regarding the state of the economy as well as the continuation of current policies, assuming no changes are made.