It’s Tuesday, May 8th, 2012….and here’s your daily dose of The Gouge!
Leading off today’s editions, two items featured at Conn Carroll’s Morning Examiner which, when considered in concert, define a decision Conservative voters across the country will inevitably confront: do we stay with the past or bet on the future?
First up, RedState.com‘s Erick Erickson defines the past:
Tomorrow, Retire Dick Lugar
I really do adore Peggy Noonan. I respect her opinion and I love her writing. I take issue with her support of Richard Lugar, however.
Peggy Noonan writes that Indiana should “save the old guy. He has value.” She also says Washington needs grown ups and “we need mature folk involved in our governance, people for whom not everything is new.” With respect, Mr. Lugar has no more value. He and his cohorts have given all the value to China.
Richard Lugar has been in Washington since January of 1977. I was one. The federal debt was approximately $650 billion. The federal debt now surpasses $15 trillion. And you know what? The grown ups did it. The grown ups, the mature folks, the adults in the room were the ones who did it. Richard Lugar was complicit in this catastrophic balance sheet. He rarely stood in the way of an increase in debt, an increase in spending, a bridge to nowhere, and a future to bankruptcy.
While Richard Lugar was joining the other grown ups in raiding the treasury for pet projects, Richard Mourdock was first in the private sector, then became Indiana’s State Treasurer. He fought the Obama Administration’s GM bankruptcy. He fought the Obama Administration on Obamacare. He helped Indiana balance its books.
The two men are both adults. Richard Mourdock’s parents are both World War II veterans. Yes, his father and his mother. He knows what sacrifice is like. He knows what hard work is like. And he knows that just as his parents quite literally fought for a better world, he must too.
In Washington, “adult” is the term of art for the men and women who reach across the aisle. They cut deals. They save face. They make government work. In their zeal to make government work, the perverse reverse has happened. We now work for the government. We sustain the leviathan. Our children’s children’s children will pay off the debt Richard Lugar helped incur.
I’d prefer it if we stopped sending his ilk to Washington to keep incurring debts for my children and grand children in the name of being grown up.
Next, The Weekly Standard‘s Steve Hayes offers a glimpse of what we deem a far brighter future:
Vice President Marco Rubio?
Senator Marco Rubio appeared on Fox News Sunday with Chris Wallace this weekend and gave viewers a clear understanding why many conservatives see him as a strong candidate to be Mitt Romney’s running mate. Rubio answered Wallace’s questions directly and forcefully, drawing sharp contrasts between Obama’s record and the Republican vision for the next four years.
Part of what makes Rubio so effective, beyond his obvious grasp of the substance of the policies being discussed, is the tone he uses to criticize the Obama administration. It’s not so much anger, though some anger might be warranted, but disappointment. So when Rubio talks about Obama’s failings on the economy, he reminds viewers of the promises Obama made – to revive the economy and restore the faith of Americans in their government – and laments the president’s inability to deliver. He did the same thing when asked for his reaction to the Obama administration’s use of the death of Osama bin Laden.
“Let me focus on this issue of bin Laden for a moment. That was a very proud day for all Americans. Our Armed Forces did a phenomenal job and the president made an important and wise decision – and he has gotten his due credit, and rightfully so, for making that decision. But now he’s taken if further. He has taken something that should unite the American people – a moment of pride for our country – and instead turned it into a weapon of political warfare. And I think that’s wrong. I really do. I think it’s wrong for the president and for the vice president to take this issue and use it for politics.”
Rubio then used his disappointment to make a larger point about Obama, one that speaks directly to the segment of the electorate who invested in their hopes in Obama and have been let down.
“And it goes back to the point I tried to make earlier: When this president ran for office in 2008, he said he was going to be different. He was going to be a post-partisan uniter, to bring Americans together. And three and a half years later, the president, quite frankly, has become just like anyone else in Washington, D.C. And in his obsessive effort to win his reelection, he has lost himself and he has lost what makes him different. (Rubio’s too kind….far too kind; Obama could not lose what he never had in the first place.) And this issue of they’ve used the bin Laden raid is one example about how this administration is just like everybody else.” (No….they’re WORSE than everybody else; George W. Bush would never have conducted himself in such an unseemly manner; hell, Bill Clinton wouldn’t have stooped as low.)
It’s an argument that won’t appeal to the 30-something percent of the electorate who will vote for Obama under any circumstances and are now spending their time explaining and excusing his failures. But Obama won because he inspired millions of new voters to invest their faith in him and persuaded others to support his cause. It’s those voters who will be so important this time around – and their decisions about whether to back him again, to stay home or to support Romney, will go a long way to determining who wins the election.
Rubio spoke to them Sunday morning—and, if Mitt Romney was watching, it’s hard to believe he didn’t see the potential of having Rubio as a full-time spokesman on his behalf this fall.
That is what much of the current speculation about Rubio-as-running mate misses. It’s been largely a focus on geography and ethnicity – a steady stream of musing about his ability (or alleged inability) to move Hispanic voters to the Romney column and theorizing about whether the mere presence of his name would win Florida for Romney. The whole thing has a static quality about it as if what Rubio actually did on the ticket was somehow secondary.
It’s not. And the strongest argument for Rubio’s inclusion on the ticket, in spite of concerns about his age, relative inexperience, and a challenging friend, is how Rubio would actually perform as a candidate. The quality of his appearance on Fox News Sunday is the rule, not the exception. On the stump, he usually speaks without notes and in thirty minutes, with seemingly little effort, can transform a room of sleepy senior citizens into a raucous crowd of would-be reformers ready to put up yard signs until Election Day. Beyond that, imagine a television ad in which running mate Rubio speaks directly to the camera and tells the story of his upbringing, of his mother working as a maid and his father as a bartender so that their children might have opportunities that they did not. In Rubio’s telling, it’s both exceptional and typical – a moving tale of family sacrifice that will be familiar to so many across the country.
There are reasons that Romney might want another running mate and reasons Rubio might prefer to remain in the Senate. But if Romney decides to ask Rubio to be considered and eventually to run with him, I suspect it’ll have much less to do with Rubio’s name and his native state than it will with what Rubio would do as a running mate and vice president.
In a related item, Richard Lugar is the subject of today’s “What Do YOU Think?” segment:
Lugar, Indiana’s long-time senator, heads into GOP primary as underdog
So what if I haven’t lived in Indiana since 1977; that doesn’t mean I’ve gone all Washington on you!
Should Lugar lose tomorrow’s Republican primary, will it cost the GOP his Indiana Senate seat? Go to the poll on our home page at www.thedailygouge.com and tell us what YOU think. And while you’re there, enjoy today’s Cover Story and our featured video clips.
As for us, we believe the the movement to throw out the old and usher in the new, precisely what the Tea Party represents, is long overdue. Compromising with Dimocrats today is akin to conceding it’s not whether we’re heading for insolvency, but simply a question of how quickly we get there.
The bottom line? Richard Lugar helped create the problem; Mourdock offers the solution.
Speaking of problems, the WSJ‘s Bret Stephens offers his insight into the primary issue facing those setting forth from the haven of Higher Education into the cold, cruel world:
To the Class of 2012
Attention graduates: Tone down your egos, shape up your minds.
What we’d be willing to bet was, in reality, the major of most of the Class of 2012.
Dear Class of 2012:
Allow me to be the first one not to congratulate you. Through exertions that—let’s be honest—were probably less than heroic, most of you have spent the last few years getting inflated grades in useless subjects in order to obtain a debased degree. Now you’re entering a lousy economy, courtesy of the very president whom you, as freshmen, voted for with such enthusiasm. Please spare us the self-pity about how tough it is to look for a job while living with your parents. They’re the ones who spent a fortune on your education only to get you back— return-to-sender, forwarding address unknown.
No doubt some of you have overcome real hardships or taken real degrees. A couple of years ago I hired a summer intern from West Point. She came to the office directly from weeks of field exercises in which she kept a bulletproof vest on at all times, even while sleeping. She writes brilliantly and is as self-effacing as she is accomplished. Now she’s in Afghanistan fighting the Taliban.
If you’re like that intern, please feel free to feel sorry for yourself. Just remember she doesn’t.
Unfortunately, dear graduates, chances are you’re nothing like her. And since you’re no longer children, at least officially, it’s time someone tells you the facts of life. The other facts.
Fact One is that, in our “knowledge-based” economy, knowledge counts. Yet here you are, probably the least knowledgeable graduating class in history.
A few months ago, I interviewed a young man with an astonishingly high GPA from an Ivy League university and aspirations to write about Middle East politics. We got on the subject of the Suez Crisis of 1956. He was vaguely familiar with it. But he didn’t know who was president of the United States in 1956. And he didn’t know who succeeded that president.
Pop quiz, Class of ’12: Do you? (We do!)
Not with a Sociology degree, thank you!
Many of you have been reared on the cliché that the purpose of education isn’t to stuff your head with facts but to teach you how to think. Wrong. I routinely interview college students, mostly from top schools, and I notice that their brains are like old maps, with lots of blank spaces for the uncharted terrain. It’s not that they lack for motivation or IQ. It’s that they can’t connect the dots when they don’t know where the dots are in the first place.
Now to Fact Two: Your competition is global. Shape up. Don’t end your days like a man I met a few weeks ago in Florida, complaining that Richard Nixon had caused his New York City business to fail by opening up China.
In places like Ireland, France, India and Spain, your most talented and ambitious peers are graduating into economies even more depressed than America’s. Unlike you, they probably speak several languages. They may also have a degree in a hard science or engineering—skills that transfer easily to the more remunerative jobs in investment banks or global consultancies.
I know a lot of people like this from my neighborhood in New York City, and it’s a good thing they’re so well-mannered because otherwise they’d be eating our lunch. But if things continue as they are, they might soon be eating yours.
Which reminds me of Fact Three: Your prospective employers can smell BS from miles away. And most of you don’t even know how badly you stink.
When did puffery become the American way? Probably around the time Norman Mailer came out with “Advertisements for Myself.” But at least that was in the service of provoking an establishment that liked to cultivate an ideal of emotional restraint and public reserve.
To read through your CVs, dear graduates, is to be assaulted by endless Advertisements for Myself. Here you are, 21 or 22 years old, claiming to have accomplished feats in past summer internships or at your school newspaper that would be hard to credit in a biography of Walter Lippmann or Ernie Pyle. (Gee….who does THAT bring to mind?!? Hint….
All hail the Narcissist-in-Chief!
If you’re not too bright, you may think this kind of nonsense goes undetected; if you’re a little brighter, you probably figure everyone does it so you must as well. But the best of you don’t do this kind of thing at all. You have an innate sense of modesty. You’re confident that your résumé needs no embellishment. You understand that less is more. (Unlike your President.)
In other words, you’re probably capable of thinking for yourself. And here’s Fact Four: There will always be a market for people who can do that.
In every generation there’s a strong tendency for everyone to think like everyone else. But your generation has an especially bad case, because your mass conformism is masked by the appearance of mass nonconformism. It’s a point I learned from my West Point intern, when I asked her what it was like to lead such a uniformed existence.
Her answer stayed with me: Wearing a uniform, she said, helped her figure out what it was that really distinguished her as an individual.
Now she’s a second lieutenant, leading a life of meaning and honor, figuring out how to Think Different for the sake of a cause that counts. Not many of you will be able to follow in her precise footsteps, nor do you need to do so. But if you can just manage to tone down your egos, shape up your minds, and think unfashionable thoughts, you just might be able to do something worthy with your lives. And even get a job. Good luck!
Next up, as the AEI‘s Christina Sommers details, it’s almost as if the Left doesn’t WANT a recovery:
The case against the Paycheck Fairness Act
The Paycheck Fairness Act looks like common sense, but instead of helping women it will hurt all workers. The legislation, built on 30 years of spurious advocacy research, will impose unnecessary and onerous requirements on employers.
Groups like the National Organization for Women insist that women are being cheated out of 24 percent of their salary. The pay equity bill is driven by indignation at this supposed injustice. Yet no competent labor economist takes the NOW perspective seriously. An analysis of more than 50 peer-reviewed papers, commissioned by the Labor Department, found that the so-called wage gap is mostly, and perhaps entirely, an artifact of the different choices men and women make—different fields of study, different professions, different balances between home and work. Wage-gap activists argue that even when we control for relevant variables, women still earn less. But it always turns out that they have omitted one or two crucial variables. Congress should ignore the discredited claims of activist groups.
The misnamed Paycheck Fairness Act is a special-interest bill for litigators and aggrieved women’s groups. A core provision would encourage class-action lawsuits and force defendants to settle under threat of uncapped punitive damages. Employers would be liable not only for intentional discrimination (banned long ago) but for the “lingering effects of past discrimination.” What does that mean? Employers have no idea. Universities, for example, typically pay professors in the business school more than those in the school of social work. That’s a fair outcome of market demand. But according to the gender theory permeating this bill, market forces are tainted by “past discrimination.” Gender “experts” will testify that sexist attitudes led society to place a higher value on male-centered fields like business than female-centered fields like social work. Faced with multimillion-dollar lawsuits and attendant publicity, innocent employers will settle. They will soon be begging for the safe harbor of federally determined occupational wage scales.
This bill also authorizes the secretary of labor to award grants to organizations to teach women and girls how to negotiate better salaries and compensation packages. Where is the justice in that? (Or, more importantly, the FAIRNESS?!?) The current recession has hit men harder than women. Census data from 2008 show that single, childless women in their 20s now earn 8 percent more on average than their male counterparts in metropolitan areas. If Congress is going to enact labor legislation with the word “fair” in it, it cannot limit the benefits to women.
Senators may be tempted to vote for the Paycheck Fairness Act out in the mistaken belief that it is a common-sense equity bill. It is not. It won’t help women, but it will create havoc in an already precarious job market.
Which is all Dimocrats, whatever the specific issue, seem to be about. Think about it: from illegal immigration to energy, tax rates to the environment, modern Liberals seem bound and determined to act in a fashion which is completely counterproductive to America’s interests….and they couldn’t care less!
In a related item, courtesy of The New Media Journal, The Daily Caller relates how what’s incumbent upon the goose doesn’t matter a whit to the gander:
Obama campaign office staff lacks racial diversity, may violate civil rights law
Civil rights lawyers told The Daily Caller that President Barack Obama’s 2012 campaign managers may have violated employment law by hiring an overwhelmingly white office staff for his campaign headquarters in Chicago.
That skewed workforce is starkly visible in an April photo released by Obama’s Chicago office, which shows roughly 100 of the office’s staff.
Like white on rice!
Only two of the people in the photo, far in the back, are clearly African-American, far below their 13 percent of the national population, and their 33-percent representation in Chicago. (Where, inquiring minds want to know, are the Reverends on this?!?)
“Were I the general counsel of an employer in Chicago with the workforce in the picture … I would be concerned,” said Charles Shanor, a law professor at Emory University and the former general counsel at the Equal Opportunity Employment Commission. “The workforce is overwhelmingly made up of young white males [and is] a demographic profile that could raise red flags under both Title VII of the Civil Rights Act of 1964 and the Age Discrimination in Employment Act,” he told TheDC.
If asked by managers, “‘Do we run a risk of legal liability?’ I would say ‘Sure,’” if a company’s picture showed only two African-Americans in a staff of 100, said Northeastern University’s Roger Abrams, a left-of-center law professor and former dean of the Rutgers School of Law. Skewed hiring happens, Abrams told TheDC, because “people are simply not aware of what they’re doing … [or that] the racism, the sexism, the discrimination on the basis of other grounds, are just a way of life.”
“….people are simply not aware of what they’re doing….[or that] the racism, the sexism, the discrimination on the basis of other grounds, are just a way of life.” Talk about your typical Liberal catch-all; who ever mentioned sexism or any other form of discrimination? The photograph plainly shows a number of women, even an Asian (or Alaskan native) woman right up front.
And absent proof a significant percentage of those shown aren’t, it’s safe to assume, at least based on the Socialists’ own statistics, a minimum of 10% of those pictured are GLBT.
For the record, we’re not one to defend anything this Marxist does; but absent proof of active discrimination, counsel is offering facts not in evidence. Given the percentage of ethnic Chicagoans categorically unqualified to sweep the streets, let alone participate in a presidential campaign, demographics are meaningless.
This photo proves nothing….other than the utter idiocy of racial quotas of ANY kind.
And since we’re on the subject of patent Progressive palaver, the Cato Institute’s Alan Reynolds, writing at the WSJ, definitively declares….
Of Course 70% Tax Rates Are Counterproductive
Some scholars argue that top rates can be raised drastically with no loss of revenue. Their arguments are flawed.
President Obama and others are demanding that we raise taxes on the “rich,” and two recent academic papers that have gotten a lot of attention claim to show that there will be no ill effects if we do.
The first paper, by Peter Diamond of MIT and Emmanuel Saez of the University of California, Berkeley, appeared in the Journal of Economic Perspectives last August. The second, by Mr. Saez, along with Thomas Piketty of the Paris School of Economics and Stefanie Stantcheva of MIT, was published by the National Bureau of Economic Research three months later. Both suggested that federal tax revenues would not decline even if the rate on the top 1% of earners were raised to 73%-83%.
Can the apex of the Laffer Curve—which shows that the revenue-maximizing tax rate is not the highest possible tax rate—really be that high?
The authors arrive at their conclusion through an unusual calculation of the “elasticity” (responsiveness) of taxable income to changes in marginal tax rates. According to a formula devised by Mr. Saez, if the elasticity is 1.0, the revenue-maximizing top tax rate would be 40% including state and Medicare taxes. That means the elasticity of taxable income (ETI) would have to be an unbelievably low 0.2 to 0.25 if the revenue-maximizing top tax rates were 73%-83% for the top 1%. The authors of both papers reach this conclusion with creative, if wholly unpersuasive, statistical arguments.
Most of the older elasticity estimates are for all taxpayers, regardless of income. Thus a recent survey of 30 studies by the Canadian Department of Finance found that “The central ETI estimate in the international empirical literature is about 0.40.”
But the ETI for all taxpayers is going to be lower than for higher-income earners, simply because people with modest incomes and modest taxes are not willing or able to vary their income much in response to small tax changes. So the real question is the ETI of the top 1%.
Harvard’s Raj Chetty observed in 2009 that “The empirical literature on the taxable income elasticity has generally found that elasticities are large (0.5 to 1.5) for individuals in the top percentile of the income distribution.” In that same year, Treasury Department economist Bradley Heim estimated that the ETI is 1.2 for incomes above $500,000 (the top 1% today starts around $350,000).
A 2010 study by Anthony Atkinson (Oxford) and Andrew Leigh (Australian National University) about changes in tax rates on the top 1% in five Anglo-Saxon countries came up with an ETI of 1.2 to 1.6. In a 2000 book edited by University of Michigan economist Joel Slemrod (“Does Atlas Shrug?”), Robert A. Moffitt (Johns Hopkins) and Mark Wilhelm (Indiana) estimated an elasticity of 1.76 to 1.99 for gross income. And at the bottom of the range, Mr. Saez in 2004 estimated an elasticity of 0.62 for gross income for the top 1%.
A midpoint between the estimates would be an elasticity for gross income of 1.3 for the top 1%, and presumably an even higher elasticity for taxable income (since taxpayers can claim larger deductions if tax rates go up.)
But let’s stick with an ETI of 1.3 for the top 1%. This implies that the revenue-maximizing top marginal rate would be 33.9% for all taxes, and below 27% for the federal income tax.
To avoid reaching that conclusion, Messrs. Diamond and Saez’s 2011 paper ignores all studies of elasticity among the top 1%, and instead chooses a midpoint of 0.25 between one uniquely low estimate of 0.12 for gross income among all taxpayers (from a 2004 study by Mr. Saez and Jonathan Gruber of MIT) and the 0.40 ETI norm from 30 other studies.
That made-up estimate of 0.25 is the sole basis for the claim by Messrs. Diamond and Saez in their 2011 paper that tax rates could reach 73% without losing revenue.
The Saez-Piketty-Stantcheva paper does not confound a lowball estimate for all taxpayers with a midpoint estimate for the top 1%. On the contrary, the authors say that “the long-run total elasticity of top incomes with respect to the net-of-tax rate is large.”
Nevertheless, to cut this “large” elasticity down, the authors begin by combining the U.S. with 17 other affluent economies, telling us that elasticity estimates for top incomes are lower for Europe and Japan. The resulting mélange—an 18-country “overall elasticity of around 0.5″—has zero relevance to U.S. tax policy.
Still, it is twice as large as the ETI of Messrs. Diamond and Saez, so the three authors appear compelled to further pare their 0.5 estimate down to 0.2 in order to predict a “socially optimal” top tax rate of 83%. Using “admittedly only suggestive” evidence, they assert that only 0.2 of their 0.5 ETI can be attributed to real supply-side responses to changes in tax rates.
The other three-fifths of ETI can just be ignored, according to Messrs. Saez and Piketty, and Ms. Stantcheva, because it is the result of, among other factors, easily-plugged tax loopholes resulting from lower rates on corporations and capital gains.
Plugging these so-called loopholes, they say, requires “aligning the tax rates on realized capital gains with those on ordinary income” and enacting “neutrality in the effective tax rates across organizational forms.” In plain English: Tax rates on U.S. corporate profits, dividends and capital gains must also be 83%.
This raises another question: At that level, would there be any profits, capital gains or top incomes left to tax?
“The optimal top tax,” the three authors also say, “actually goes to 100% if the real supply-side elasticity is very small.” If anyone still imagines the proposed “socially optimal” tax rates of 73%-83% on the top 1% would raise revenues and have no effect on economic growth, what about that 100% rate?
Seriously, why worry about facts….when you can just make ’em up as you go along!
On the Lighter Side….
Finally, in another truly sordid story ripped from the pages of the Crime Blotter,:
Second victim dies in beating of elderly couple, as suspect could face more charges
An Oklahoma man suspected in a brutal home invasion — already facing a murder charge for allegedly killing an elderly woman — could face additional charges after the death last week of her husband, a D-Day veteran. Bob Strait, a 90-year-old Tulsa resident, died on Friday, and a medical examiner is determining his cause of death, News On 6 reports.
He was injured March 13 when, police say, Tyrone Woodfork, 20, entered the house and attacked, allegedly beating and sexually assaulted Strait’s 85-year-old wife, Nancy Strait, who died two days later. The couple had been married for 65 years.
Woodfork was arrested a day after the incident when he was spotted driving around in Strait’s vehicle, a Tulsa Police Department spokesman told FoxNews.com. Woodfork was booked into the Tulsa County Jail on March 15 and is being held on charges of first degree murder, first degree burglary, armed robbery and assault with a dangerous weapon.
Though we’re eternally grateful for Bob Strait’s service, it’s the sexual assault on his wife that truly gets our goat. As far as we’re concerned, there’s no punishment too harsh, cruel or unusual for sexual assault. But attacks on the very old, or very young, are particularly heinous.
At the risk of seeming harsh, having been deemed guilty beyond a reasonable doubt by a jury of his “peers”(like this deviant has any peers outside of Fire Island, Provincetown, Key West or The Castro) , there’s no form of torture/execution too medieval for Woodfork’s sorry ass.
Magoo
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