Ignore Income Inequality

A few days ago Paul at PowerLine had fun with Jeff Stein at Washington Post trying to use income inequality to support a wish list on the left.  Do read all that Paul has to say but he puts the major point succinctly:

I like to ask those who throw such numbers around questions like “how much wealth in relation to the poorest 80 million households should the richest 400 Americans control?” and “what percentage of the wealth created in this country since 1982 should have gone to the top 5 percent?”

Unless you have a goal there is no reason to play.  We would have put the goal as a Gini Coefficient but the effect is the same.  We want to play too.

Early on Jeff says:

But while there’s consensus that America is a wildly unequal country, there’s broad disagreement on what, if anything, should be done to address that. [Emphasis added]

It is hard to define wildly in the sentence above but our response would be that there is no consensus that America is a wildly unequal country and there is broad agreement that nothing should be done about income inequality per se.  Perhaps we are being hopeful on the consensus but we hope not.  There is much to do to improve the economic lot of Americans but trying to change the some aspect of income inequality is taking your eye off the ball.

Jeff has a couple of fun suggestions from Americans For Tax Reform and the Heritage Foundation.  They are Get Government Out Of The Way, Repeal Rules And Regulation and, our favorite, Send The 1% To Venezuela.  The latter is tongue in cheek but it is likely to reach the goal without much damage to the economy.  Why not much damage to the economy?  Well Facebook, Microsoft, and Walmart will still be American companies.  America might lose some spending by those rich folks but we won’t lose the capital.  Most of the rest are just a wish list from the left like universal government childcare or union rights often combined with taxing capital.  It is not clear that any of those suggestions will help income inequality and, as proof of the distraction of income inequality, the proponents rarely argue their suggestion is the best way to combat income inequality.  Let’s worry about important stuff.  Changing income inequality is not important in America.

 

 

 

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Thanks Paul

Paul Ryan is retiring from the House.  He has made a big difference.  He has succeeded in reforming taxes.  He was unable to reform entitlements but surely he has influenced that debate and we will be thankful for him later.  Our fondest wish is unfulfilled: We wish he was in his second term as Vice-President.  We wonder if their will be a Churchillian second act for him as entitlements fester.

Wisconsin’s Congressional delegation gives us reason to be humble and proud.  We Paul in the House and Ron in the Senate we might have the best pair of any state.  Paul is leaving shortly and Ron not long after that.  We wish everyone would follow their lead by coming in and trying to make a difference, behaving well, and then moving on.  Paul and Ron have made a difference and been a credit to our state and the nation.  Thanks to both of them.

Bad Stats For Re-enfranchisement

George Will at NRO would like for ex-felons to vote.  It is not a terribly important issue but we tend to agree with him.  We would want to discuss exactly when the felon becomes ex.  That is, it is release from prison or some time later.  We don’t see why murder or sexual offenses should be excluded as they are in the Florida ballot initiative.  As always, ballot initiatives are a bad idea.  In a few cases, but not this one, they are the least bad idea available.  We think, however, that one of his points is poorly taken.  George says:

Recidivism among Florida’s released felons has been approximately 30 percent for the five years 2011–2015. Of the 1,952 persons whose civil rights were restored, five committed new offenses, a recidivism rate of 0.4 percent. This sample is skewed by self-selection — over-representation of those who had the financial resources and tenacity to navigate the complex restoration process that each year serves a few hundred of the 1.6 million. Still, the recidivism numbers are suggestive.

We were surprised at the high number of new offenses, five, for the folks that had done all that work.  We don’t find the number suggestive of anything but a signal resources by 1,952 folks.

It would be a useful thing to have legislative hearings in the 36 states that do not re-enfranchise felons.  There are issues to work out like timing and potential exceptions.  The legislature should do it rather than the courts or a ballot initiative.  We should do it through the normal processes.

RE: The Atlantic

Earlier this week we were praising The Atlantic for hiring Kevin Williamson and discussing his first article there.  Unless you have been off-planet you have heard what has happened.  Here is how Jim Geraghty’s Morning Jolt  put it:

Jeffrey Goldberg’s announcement that The Atlantic had “parted ways” with our old friend Kevin Williamson — what a gutless way to announce you’ve fired someone, a week or so into the job — represents a successful effort to redefine “beyond the pale” in the political debates of 2018, or to close the Overton Window, if you prefer that metaphor.

This is an event that tells us more than we want to know about the left and The Atlantic.  Well, you might say Kevin’s firing confirms what you already knew.

Sidebar: We are really curious about the contract between Kevin and The Atlantic.Will he be a kept man for the next year or two?  If not, why did he go to The Atlantic?  End Sidebar.

The question becomes should we boycott The Atlantic?  The answer is no.  Their claim, however, that you should:

Subscribe to The Atlantic and support 160 years of independent journalism.

rings hollow.  We know there won’t be much interesting there but cruise by from time to time.  To buttress our point on independent journalism, nobody at The Atlantic has taken to defending Kevin yet although we don’t think he will need any help.  This turn of events is unlikely to make a man sometimes referred to as “Mad Dog” mellow.

Postal Service Allocations II

Recently we wrote that the arguments put forth by The Donald and others that the US Postal Service (USPS) was giving Amazon a subsidy were unconvincing because fixed cost allocations are arbitrary.

Sidebar One: We use first person plural, Sidebars and don’t cite ourselves.  We don’t have that many posts that you can’t look and check.  That is how we roll.  End Sidebar One.

We have changed our mind and concluded that The Donald and others are not just unconvincing but they are wrong.  In looking at the evidence we see that the USPS has excess capacity because there is less first class mail.  The USPS has capacity and Amazon has packages.  The USPS is using Amazon to support first class mail rather than the other way around.  We should salute a not-for-profit organization for making such astute business decisions.

Sidebar Two: An interesting question is what is the extent of the USPS’s fixed costs.  Do they, or realistically, to what extent should labor costs be included.  There is a nice research opportunity there.  End Sidebar Two.

There are reasons to be upset with the USPS.  The Amazon deal is not one of them.

Olympic Rings For Batting

Giancarlo Stanton became a baseball immortal, sort of, on Tuesday.  He struck out five times in a nine-inning game joining 65 other players (you can check our counting) in ignominy including Alex Rios who did it twice.

Several of the players on the list are pitchers so they are less compromised because batting five or more times as a pitcher almost always means a win.  For example, Lefty Grove won while striking out four Yankees but being struck out five times.  Ray Jarvis did it for the Red Sox by giving up one run and getting a win while pitching eight and two-thirds innings in relief of Ken Brett, George’s younger brother.  We did not do a comprehensive search but we are willing to bet that Ray is the only person who earned Olympic Rings without starting the game.

Well Said Veronique

Veronique De Rugy takes The Donald to task over trade wars at the NRO Corner.  She starts with:

President Trump claimed in a tweet that “trade wars are good, and easy to win.” Unfortunately, the American people are about to experience firsthand how wrong the president is and how painful and hard it really is to “win” a trade war.

It is hard to win any war and even harder to come out ahead.  That’s why we try to avoid wars.  Veronique recognizes that trade wars are just a way to impoverish two or more nations:

Tariffs imposed by any government are, first and foremost, penalties on those of its own citizens who buy imports (or import-competing domestic goods). Uncle Sam’s tariffs, therefore, are penalties imposed on Americans. That’s what they are, period.

We don’t want to go review the John Roberts Obamacare arguments but we would prefer tax to penalty.  Other than that we are in full support of Veronique.  She also goes on to explain that the Chinese are likely to be better at abusing their citizens than the US which suggests the difficult of winning a futile war.  The Donald has often been right about economics but on tariffs he is dead wrong.