Hating The Donald

We were wandering around the Internet.  First we went to Tyler Cowen’s Marginal Revolution site. Tyler is a serious economist.  Wikipedia tell us that:

He was ranked #72 among the “Top 100 Global Thinkers” in 2011 by Foreign Policy Magazine “for finding markets in everything.”[4] In a 2011 poll of experts by The Economist, Cowen was included in the top 36 nominations of “which economists were most influential over the past decade.”

He said that Christopher Lebron at the Boston Review had the best review of Black Panther.  We are interested in the movie and want another review.  Armond White has never been very helpful for us.  Armond is too worried about philosophy and has too many reference to movies we haven’t seen.  We want to know if the movie is entertaining.  We thought the Greatest Showman was a really entertaining movie.  We were shocked at how good it was after so many poor movies recently.  Interestingly, the preview from the star and director suggests that they wanted to make an entertaining movie.  Perhaps it is not hard to make an entertaining movie if that is your goal.

Tyler does say the review is via Hollis Robbins but we think he should read it to link to it.  Here is part of the first paragraph of Christopher’s review:

This is a tall order, especially in the time of [The Donald], who insists that blacks live in hell and wishes that (black) sons of bitches would get fired for protesting police violence.

We wonder what somebody would need to say about a political figure to have it be a bad review?  We don’t know much about the Boston Review.  They might think it crucial that they signal their hate of The Donald to their audience.   We are, however, disappointed in Tyler.  He should understand the importance of  rhetoric.


Quasi-Experimental Results

Some results are in on the quasi-experiment designed by the GOP.  The recently passed tax reform bill coincides with an Apple announcement in the WSJ that it:

would make a one-time tax payment of $38 billion on profits accumulated overseas and ramp up its spending in the U.S., as it seeks to emphasize its contributions to the American economy after years of taking criticism for outsourcing manufacturing to China.

An interesting part of the coverage is the difference between the WSJ reporting and the WSJ editorial page.  Here is more of the WSJ reporting cited above:

Apple said its one-time tax payment was the result of recent changes to U.S. tax law, under which companies must pay a one-time tax of 15.5% on overseas profits held in cash and other liquid assets. Profits held in other forms will be taxed at 8%. The company said in November that it had earmarked $36 billion to cover deferred taxes on its $252.3 billion in overseas cash holdings, assuming that it would eventually pay U.S. taxes on a portion of it by bringing it home.  [Emphasis added]

The news gives the new tax rate rather than the reduction, which would seem to be the interesting part, and suggests that the profits would have come home eventually anyway.  The details are not complete here but it looks like the news folks are confusing financial accounting and tax accounting.  The WSJ editorial page has a different take:

Apple said Wednesday that it will pay $38 billion in taxes on the $250 billion or so in cash the company holds overseas; that’s a lot of money for Social Security checks and food stamps. Apple also said it would invest or spend on purchases some $350 billion in the U.S. over five years and add 20,000 jobs.

Apple’s windfall for the U.S. Treasury is the result of the reform bill’s 15.5% “deemed” tax rate on profits previously earned overseas whether or not they are returned to the U.S. The old system featured a one-two punch of taxation abroad and than again at home at a punishing 35% rate if the money was repatriated.

Apple had no plans to return the money to the U.S. under that regime, and ditto for many other companies that together have some $2.5 trillion abroad. Republicans broke this logjam by lowering the top rate and creating a permanent system that taxes income where it’s earned. Now Apple can put this cash to whatever the company deems the highest use, without arbitrage from tax policy.

We can’t live out the other option of high corporate taxes and there is only one Apple so we can’t randomly assign anything.  We can’t make any statistical statements and there is some possibility of arguing cause and effect because it is only a quasi-experiment.  The results, however, seem robust to us because of the previous statements of corporate officials and the proximity of the tax change and the results.

Hillary And Russia

James Freeman at Best Of The Web on the WSJ discusses the issue of how much trouble the previous administration should be in over its investigation into The Donald’s campaign and administration.  He is taking issue with the NYT over their recent reporting:

The NYT lays out a dossier-free explanation of the genesis of the federal investigation of the opposition political party [NYT follows]:

During a night of heavy drinking at an upscale London bar in May 2016, George Papadopoulos, a young foreign policy adviser to the Trump campaign, made a startling revelation to Australia’s top diplomat in Britain: Russia had political dirt on Hillary Clinton. [Emphasis added]

You should read it all if you are a subscriber.  We would like to take a different issue with the NYT: the words startling and revelation.  This is not startling.  It is not a revelation.  If you picked the Patriots to win the AFC East [either 2016 or 2017] at the same time you were not nearly as safe as George.  Is there any sentient being that thinks that Russia and several other countries do not have political dirt on Hillary and The Donald?  Even if you are not certain that Russia hacked Hillary’s email you know that Russia is serious about spying and Hillary is careless.  Of course Russia has dirt on Hillary and The Donald.  The difference is that Hillary knows that the press will keep her dirt under the rug unless somebody like Russia forces the issue.  The Donald doesn’t seem to care about the dirt.  The leverage that the dirt on Hillary would give Russia might matter.

What we can’t understand is why a top diplomat from Australia would be surprised about this.  Was it George’s certainty?  Australia’s diplomats don’t seem very up on world events.  Or perhaps it is the NYT that isn’t up on world events.

The Donald: 2017

There has been much discussion about evaluating or re-evaluating The Donald because of the things that have happened during the first year of his presidency.  Kevin Williamson at NRO finds it the year of lost opportunities.  Kevin concludes:

That 2017 has been a year of lost opportunities is an important failure for Republicans, who are likely to accomplish even less in 2018, when the prospect of congressional elections held in the shadow of Trump’s unpopularity will brighten the already visible yellow streak running down the back of Republican Washington.

Jonah Goldberg at NRO concludes that the accomplishments should not be attributed to The Donald.  He says:

To listen to Trump’s cheerleaders, the biggest obstacle to conservative victories is the party establishment, when in reality it looks more like it’s running the show.

Ramesh Ponnuru at NRO is much more positive.  He thinks The Donald has been a success on policy matters but hasn’t always made wise choices: Ramesh starts:

Gorsuch confirmed, ISIS defeated, taxes cut: The Trump administration has compiled a solid record of accomplishment in its first year, one that compares well with the records of many of its predecessors.

Daniel Henninger at the WSJ is close to Ramesh.  He says:

The two Trump presidencies exist as parallel universes. One is inhabited by Trump of Twitter, a character out of Rabelais’s novel “The Very Horrific Life of Great Gargantua.” Much of the American population is appalled by Trump of Twitter, who lives in a dark and deeply personal pool of feuds and fulminations. His first-year approval rating floated below 40%, while voters in Virginia and Alabama rejected his candidates, and him.

Existing alongside is a universe of solid, tangible economic success. Reporting on the season’s strong holiday retail sales, this newspaper noted that consumer confidence is at a 17-year high, with unemployment at a 17-year low—a time-frame that turns the Obama presidency into a forgotten memory.

We think it is simple.  The Donald has had an excellent first year.  Except for HW, and we could debate that, he has had the best first year since WWII.  So yes, Truman’s first year was better.

Deregulation is a big accomplishment for The Donald that is mentioned but didn’t make it in the quotes.  In addition we think he has done something that has not been mentioned that has long term importance.  He has not been reluctant to nominate “controversial” folks.  Over the past 40 years the press has made it difficult on GOP nominations.  Our explanation is that folks that are within one standard deviation to the right of center are acceptable but folks that are within three standard deviations to the left of center are acceptable.

Sidebar: Go to Wikipedia and normal distribution and click on standard deviation and coverage for background.  What it implies is that 34% of the folks to the right of center are acceptable but 49.8% to the left of center are.  We are not suggesting that there is any data to suggest that this is the exact ratios but we are convinced that it is a reasonable approximation.  End Sidebar.

We are glad to see the back of some of The Donald’s nominees but people like Betsy De Vos and Nikki Haley have been good and driven the left and the press wild.  See this hit piece on Betsy from the Washington Post.

We think The Donald’s nominees will help to dull the yellow streak that Kevin sees and will give next GOP president more leeway on appointments.   We make few predictions about the future but The Donald has one good year in the books.  With 2018 being an election year there will be even more challenges upcoming.



Facebook Irony

One of our friends reposted a Facebook item recently.  One of the reasons we started this blog was to be able to respond to foolish things on Facebook because it is too cluttered with political stuff.  We are sure there have been more foolish things but it is hard to imagine something more ironic.  Here it is:

Imagine instead of $1.5 Trillion Tax Bill, they had produced a $1.5 Trillion infrastructure bill.  Take about creating jobs!

Of course The Donald’s Immediate Predecessor (TDIP) did sign a $1.8 Trillion spending bill.  A supporter said:

“This is a bill that protects America, rebuilds it and invests in the future,” she said. “I think it’s a great bill; it’s a result of bipartisan effort [imagine that]. Let’s vote for it, and may the Force be with us.”

The result for TDIP:

With unemployment hovering near 10 percent nearly two years after President Obama signed his economic stimulus package, Mr. Obama is acknowledging that, despite his campaign promises, “there’s no such thing as shovel-ready projects.”

If TDIP can recognize it then everyone should.  Now we will wait for two years as the press gives the president the benefit of the doubt before starting to evaluate the tax cut.  That’s more irony in case you weren’t sure.

Marginal Tax Rates

Yea! Tax reform has passed.  It is mostly about the business side but the GOP has ended up with a reasonable bill on the personal side as well.  Of course the problem is that all the Democrats voted against reducing individual and business taxes so they need to try to explain their position. Jibran Khan (spell check does not like his first name!) has a useful summary over at NRO.

But is is easy to mess up.  Jim Geraghty’s Morning Jolt has this:

Looking at this chart, if you’re married and your joint taxable income is between $400,000 and $416,000 [actually $416,700], your tax rate is changing from 33 percent to 35 percent. (Quick, get your taxable income down to $399,000! Your tax rate will drop to 32 percent!)

Perhaps Jim is being sarcastic but the table isn’t really very useful unless you have an arithmetic addiction like your humble scribe.  Tax rates are marginal so the couple in Jim’s example would pay two percent more on $16,000 of their income or $320 but they would save money on almost every other dollar of taxable income except for the first $18,650.  Situations will vary because the new law changes the computation of taxable income but in the situation that Jim described the couple’s tax would be lowered by $15,558 under the new law.  Remember, tax rates are always marginal.

Essentially ever individual will pay lower taxes under tax reform.  Here is a CATO study that gussies up the results to allocate corporate tax benefits to individuals.  Because there are changes to rates and deductions there might be a few exceptions.  There won’t be many and anybody who says otherwise is misinformed.  And folks will continue to be confused about marginal rates and average rates.

Democracy In Primaries

This morning in the after-handball discussions we agreed with Jay Cost about the problems of primaries.  We identified the challenges of voting in Alabama today and then agreed that the final three in the presidential primaries were thoroughly unimpressive.  We didn’t know that Jay Cost (at NRO) had said about the same thing:

In my judgment, the top three finishers in 2016 among the two parties — Hillary Clinton, Donald Trump, and Bernie Sanders — were manifestly unfit characters to serve as commander in chief.

Jay can be an honorary handball player.  He then says it would be nice to have a solution to this problem we have seen in several presidential primaries and many senate primaries:

It is advisable instead to find some wise, virtuous, and public-spirited intermediate body that will channel the interests of the people into a slate of candidates who can represent the true welfare of the nation.

Yes it would be advisable.  He goes on to say:

It is advisable instead to find some wise, virtuous, and public-spirited intermediate body that will channel the interests of the people into a slate of candidates who can represent the true welfare of the nation.

Perhaps Madison and Jefferson are looking for a new gig.  If not, we will offer our services to both parties.  We share Jay’s concerns about democracy but we don’t see asking smaller groups to make the initial decisions will be any better.  In fact one of the presidential problems is the initial primaries in Iowa and New Hampshire.  Our only solution is equally utopian.  We need a serious, diverse press that helps inform folks making those decisions.  We expect to see weak nominees continue at the state and national level because we don’t see a solution.