Dali,Yuunan

We flew into Dali in Yuunan Province.  It is just slightly south of Miami in terms of latitude but given the altitude, over 7,000 feet at the airport, and the proximity of the Himalayas, the weather is nice with lots of sun in December but not tropical.  Winter is a perfect time to visit Dali because the rain comes in the summer.  The population is “only” 626,000.  Our two stops in Yuunan were our favorite in China.  There aren’t any epic sights like terra-cotta warriors but it has interesting people and places.

We discovered that our iPhone comes with a compass that gives you altitude.  For us it is in the extra folder.  Click on the compass and if a few seconds you get the altitude.  We used it often on our trip.  Sometimes it was just to saved us converting to feet.

We checked the weather for Dali today and there was an interesting change. It wasn’t the weather.  The forecast was sunny and in the sixties for each the next ten days.  The Weather Channel app has eliminated the air quality index for all of our Chinese cities but not the US cities.  That would be disappointing if it continues.  One of the reasons we really enjoyed Dali is that, unlike Beijing, Changsha, Xi’an, and Chengdu, the air quality was always good so you can see the water and the mountains while enjoying walking around.

The two things you must see while in Dali is the Old Town and Erhai Lake.  You could rent one of the ubiquitious scooters to see Old Town but it wasn’t in our risk preferences.  We walked Old Town and really enjoyed it.  There are lots of places with street food, to eat in and shop as well as some historic stuff.  There are some notable differences in ethnicity but if you want a bigger taste try the smaller villages around the lake.  Old Town is a big place so you can spend several days wandering around.  Or take day trips and spend your evenings in Old Town.

Sidebar: In Dali we stayed at (we are not making this up) the Lethargy Inn and really enjoyed it but we can’t find it online.  It is small and has great views.  If you can find it we recommend it. End Sidebar.

The Wikipedia site above will tell you that Erhai Lake is 72 miles in circumference so you need a car and some research or a driver.  The lake is beautiful but you really want to stop at the small towns and business around it.  This is a great trip to do on a weekend because there is more to see.  We saw a wedding, a funeral, and many (perhaps a dozen including two sessions trying to get the same space) bride/groom photo sessions.  Bride/groom photo sessions are a big thing in China and if you visit places like Erhai Lake on a weekend you will likely see one.  The small towns are the most fun.  We don’t know why they like to string upside-down umbrellas but it makes for great pictures.  There are different ethnicities in interesting costumes making wonderful food.  The small towns give a whole different vibe than the big cities.  You’ve got to see some of these small towns.

We Can Only Hope

Mike Rappaport at Law and Liberty has a nice turn of phase on taxation and fringe benefits (h/t: Instapundit).  The title is: The Indefensibility Of US Fringe Benefit Tax Laws.  Mike is starting as series on indefensible policies and first off is:

One indefensible policy involves superior tax treatment for employee fringe benefits, such as health insurance and retirement benefits, which operates to harm lower income people.

Mike is exactly right to start with fringe benefits.  We have benefitted from such policies but we still support making the tax law defensible.

Sidebar: We have always supported making fringe benefits taxable.  It is true that the change wouldn’t cost us as much today as it would earlier.  End Sidebar.

One that Mike leaves out that was an enormous benefit to us is the conversion of sick days into health care benefits.  These exceptions lead to all kinds of strange behavior but because they benefit so many people it is hard to find support to go to defensible policies.  If we US dictator for a day, making fringe benefits taxable would be at the top of our list.  We would love to see a Democratic presidential candidate burnish his populist credentials by supporting such a change.  It would be way cool to have a Democrat to vote for but we don’t see it happening.  Nice job Mike.

Falling At The First Fence

Elizabeth Warren has proposed a wealth tax as part of her campaign for the Democrat presidential nomination in 2020.  Jeff Spross at The Week has tried to get the wealth tax over the lowest possible bar: This is not crazy.  Unfortunately, Jeff’s horse, Wealth Tax has not even cleared that bar.  Jeff has what he calls a moral argument:

Taxing the portfolios of the super-wealthy at 2 or 3 percent a year may seem small. But the effects would compound over time. “We think it could have a significant affect on wealth concentration in the long run,” Emmanuel Saez, a left-leaning economist who consulted on the proposal, told The Washington Post.

Really, two or three percent a year seems small?  You are going to tax their wealth that produces, say, eight to ten percent a year at two or three and then tax their income too?  Envy is not much of a moral argument.

Then Jeff tries an economic argument.  We think this is one:

To the extent investment by the wealthy does matter, the ultra-millionaire tax could create a “use it or lose it” dynamic that would actually spur job creation and wage growth. Right now, wealthy Americans can just sit on their wealth holdings, take no risks, and get interest and returns on it.

Umm, wealthy Americans can just sit on their wealth and take no risks.  Well, we suppose they can do that and get pitiful returns on risk free investments.  We are OK with that.

There are at least three reasons why the wealth tax fails Jeff’s test: Constitutional questions, implementation, and incentives.  James Freeman at the Best of the Web in the WSJ makes a strong case that it is not constitutional.  We would like to focus on the the impact of the legal battle.  We don’t know if Elizabeth’s proposal passes constitutional muster until the Supreme Court says so.  It is like the Saints-Rams game where it isn’t pass interference until the refs call it.  (Really, you need a cite?  OK).  Just like the football game, one side must lose and the losing side at the Supreme Court will never, ever forget it.  Most likely Elizabeth isn’t worried about this but we should be.  Forcing the Supreme Court to make such a decision is going to hamstring the nomination process for justices and the Court.

The Motley Fool article cited in the first paragraph asks: is the wealth tax practical?  They bring up some serious problems but leave out the big obvious problem.  Why won’t these folks leave?  The solution to that is discussed earlier:

The plan would also increase funding to the IRS to help combat tax evasion, especially by the wealthy, and would also provide for a one-time tax penalty on people who renounce their U.S. citizenship in order to avoid paying the wealth tax.

How good do we feel about expanding the IRS given their previous behavior, especially toward conservatives?  The good news is the Democrats have finally found a wall that they like, one that keeps folks in the US.  How East German.

The incentive question is: Do we want folks to spend their time avoiding taxes or leading and innovating.  Wouldn’t you have to be crazy to pick the former?  That’s how Wealth Tax fell at the first fence.

Venezuela Spring?

We love Mary Anastasia O’Grady and not just for her name.  She factual and insightful about the world and especially Latin America in a way few people are.  Her latest piece is Venezuela Spring in the WSJ and although we support much of it we need to respectfully disagree about part of it.  Mary says:

Not since the fall of the Soviet empire has a nation risen with such fury and determination to throw off the yoke of socialism. And not since then has Marxist misery been so clear for all the world to see. Venezuelans are experiencing what millions of Russians, Chinese, Cubans and countless others have suffered. Destitute and angry, they want it to end.

How ironic that some American politicians, like Vermont Sen. Bernie Sanders and newly elected New York Democratic Rep. Alexandria Ocasio-Cortez want socialism for the U.S. The tide of history is going the other way.

We are completely on board with the first paragraph. To be explicit we support connecting socialism and Marxism.  The differences are trivial.   But it also points out that many of the folks suffering under socialism don’t want to or can’t find a way out.  We are completely on board with the first sentence in the second paragraph.  We hope Mary is right about the last sentence of the second paragraph but we are not convinced.  We are not convinced that Venezuela will end well despite the suffering of almost everyone and the bravery of so many.  We applaud what The Donald is doing but the US can only do so much.

Sidebar: The silliness of The Donald as a Russian supporter shows up again.  The most important single thing to Russia is the price of oil.  Higher is better for them.  The Donald is the sworn enemy of supporting the Russians by raising the price of oil as his actions in Venezuela, with LNG, and fracking show again and again.  His opponent in the recent election was the supporter for actions to raise the price of oil.  End Sidebar.

We hope that the tide of economic and political freedom is rising but Mary’s first sentence in the second paragraph reminds us that we need to fight socialism everywhere and every time.  Once socialism wins it takes decades to ruin a country and then a ruined country is hard to rehabilitate.  We hope that Mary is right and capitalism runs rampant in the twenty-first century but we wouldn’t bet on it.

Study Abroad

Mode has some solid tips on studying abroad.  She has advice after you have chosen to study abroad.  We would like to start out with consider study abroad.  Travel is great but living in a country is a far more intense experience.  When we lived in Poland we learned more the longer we stayed.  We have three bits of advice on investigating study abroad.

First, look for scholarships.  MWG is one of those that supports such a scholarship.  It is worth investigating scholarships and other support to see if you can afford it because it is a great experience.

Second, consider all the possibilities.  The traditional study abroad is to spend a semester or year at another school but there are all kinds of alternatives like summer sessions and guided tours in January.  If you want to be with folks from home there are programs like Wisconsin in Scotland where you study abroad but live in a castle with other Americans (we are not sure if it is limited to Wisconsinites).  One of the little Gloves did this and loved it.  Don’t worry if these programs are not at your school because almost every school is looking for folks to fill their programs.

Third, consider study abroad as early as possible.  When you are a junior or a senior you are heavily involved in courses in your major.  It is way easier to stay on schedule to graduation and you have more options if you go earlier.  The exception is if you are majoring in a language.  For example, if you are an accounting major it is extremely difficult to get US taxation abroad but you can probably get Principles of Accounting when you study abroad.  It is better to go later than to not go but later usually requires more planning and advice.  Once we thought we had finished an advising session for the fall when the advisee said that he was studying abroad in the following spring.  We started over again.  Work with both your department and your version of International Education to facilitate your program.

As you get more into your planning you can check out Mode and other folks that have gone abroad to help you with the next steps.  Start today.

Pandamonium

We went to the Chengdu Panda Breeding Research Center near Chengdu in Sichuan Province of China.  There are several other similar centers in China.  Chengdu is a city of about 14.5 million people and the Panda Center is not far from the city but it is a big (247 acres) beautiful park.  As we looked at the city from the Panda Center our view was limited by the smog.

As always, bring your passport to get into any public place.  It this case it was really useful for us because seniors got in free.  Small children get in free too.  It is a beautiful park that is well laid out to spread out visitors.  It does mean lots of walking.  There are buses to reduce your walking but it is such a pretty place we recommend walking.  Giant pandas, and especially the babies, are the stars but there are red pandas and a variety of birds too.  There are all the souvenirs that you could ever want.  The flora is nice as well.

Plan to spend most of a day there.  Get there early to beat the crowds and see the feedings that start early, around nine.  You can get a nice lunch in the Center and call it a day early in the afternoon.

At one time there was an opportunity to get us close with baby pandas.  It was not available when we were there because of a disease problem. Check online to see if it has changed back.  We saw a cost of 2000 yuan when it was available.

The animals are adorable.  If you are going to China you really need to see one of the panda sites.  We are sure that Chengdu is worth the trip.

Venezuela Revolts

Speaking of socialism, as we were recently with the Media Darling, the place that tried it, Venezuela, it trying to undo it.  We wish them luck because it will take much good luck along with insight and guts to oust the socialists.  It is good to see The Donald, unlike his immediate predecessor, siding with the good guys.

We agree with the WSJ:

There may be a lot of ruin in a nation, as Adam Smith said, but Venezuela now lies in ruins. It’s tempting to think the U.S. should send in troops, a la Panama in 1989, to assist the rebellion. But Venezuelans have to win their freedom themselves, and if they do they are likely to prize it all the more.

What a great paragraph.  Do read the whole thing.  A country rich with oil lies in ruins because of socialism.  But they voted in the socialism that ruined them.  Although recent elections were fixed at least one was not.  Venezuela needs to pick political and economic freedom for themselves.  We can’t do it for them but we can and should do it for ourselves.

 

Fooling Fifth Graders

Eric Zorn, a writer for the Chicago Tribune, showed up in the La Crosse Tribune with an oddly title op-ed, A Lesson On How Progressive Taxes Really Work.  Our former governor, Scott Walker has taken the Media Darling (MD) to task for her suggestion a top marginal rate of 70 percent.  It is epically foolish for exactly the reason Scott states, it is not fair if you earn ten dollars and you parents take seven dollars.  Here is a more technical explanation.

Eric tries to make two points.  One is technically correct but only a distraction.  He says that marginal rates and average rates are different.  Yup.  The question Eric and the MD don’t address is why they want to give such bad incentives to anyone.

Eric’s second point is that rates in the US and elsewhere have been much higher. George Harrison, as part of the Beatles, sang as part of The Taxman:

There’s one for you, nineteen for me
Cause I’m the taxman

to point out the foolishness of the 95 percent margin rate in the UK.  JFK and Ronald Reagan revived the US economy and the UK was revived by Mrs. Thatcher who recognized the foolishness of such high marginal rates.

Why are such rates foolish?  Because they cause folks to spend their time figuring out ways to avoid such taxes.  Bjorn Borg and others moved to Monaco.  Lots of financial advisors got rich.  Flatter tax rates like we currently have eliminate lots of wasteful activity.  They are also extremely progressive because income is more likely to be reported.  Here is a 2014 report showing that the top one percent pay more in federal income taxes than the bottom 90 percent.

Near the end Eric comes to the real progressive point which is envy:

Conservatives who have pushed down top marginal tax rates and expressed nonchalance about the subsequent massive growth in the wage gap have so far kept such initiatives at bay.

Progressives want to attack the rich.  Conservatives want to enrich everyone.  The envy card has been effective for progressives.  We’ve recently seen that seventeen year-olds can be heroes.  Hopefully the fifth graders and everyone else can see through Eric and MD.

Stating The Obvious

We have had a hard day enjoying the Grand deGloves (ages 1, 3, and 5) while driving through the Minnesota snow.  It isn’t snowing hard but combining a little snow with some wind and open places makes driving challenging.  Thus, when we saw Kevin D. Williamson give the following obvious solution to Brexit at NRO:

Here, the United Kingdom has an opportunity to reclaim a very old — and very British — solution: unilateral free trade.

Our immediate reaction was: didn’t we say that first?  We’re sure we have made the point that we favor unilateral free trade but we’re not sure about the example of Brexit.  It is just we are too tired to look it all up.  So, we will support Kevin.  Instead of stressing the UK economy by some convoluted agreement the government could improve the UK economy by reducing stress.

Yes, there will be some losers in the new system but there are always losers in the economy.  Always!  By reducing the stress on the UK economy and energizing the growth fairy there will be more resources to help the downtrodden.  Kevin is a noted skeptic of the growth fairy.

Sidebar: Yes, we have very (!) limited cites today.  Trust us or you can do the work and read our previous posts.  End Sidebar

But even he seems to be drinking the Kool-Aid (and we have a previous post on drinking the Kool-Aid without a cite) on the growth fairy:

Great Britain in fact grew vastly wealthy while maintaining trade arrangements that paid relatively little attention to reciprocity even in principle. British territories, notably Hong Kong, grew wealthy while following much the same model.

The way you get vastly wealthy is through economic growth.  We wonder if he is willing to admit to the long-term existence of the growth fairy?  For sure, we are both in agreement on this simple and easy solution to Brexit: Unilateral free trade.

The Joys Of Socialism

In the coming presidential primaries some of the candidates are going to advocate socialism.  They need to be asked many questions about their advocacy.  One of them is: “What about Venezuela?”  Here is part of an update from Reuters:

Childhood hunger, decrepit schools and shortages of medicine and vaccinations already were problems amid the collapse of an economy once renowned for abundant oil wealth. With more parents migrating, experts interviewed by Reuters said growing problems facing Venezuelan children now include slumping school performance and malnutrition of newborns separated from would-be nursing mothers.

As always you should read the whole thing.  Venezuela is a country rich with natural resources but incredibly poor with socialism.

Of course, we get into a problem of trying to label everything.  Socialism is bad so folks try to label X as socialized X to defeat X.  Smart News might be the antidote to such thinking.  We hope it is but you still need to ask the avowed socialists what they mean by socialism and how they think socialism is going to work.  Yes, math is still required.