The New Editor - Economics

Federalism: One 'Moving' Measurement

tpelia@yahoo.com (Tom Elia) — Thu, 07 Feb 2013 09:55:00 -0700

Yesterday it was reported that CA Gov. Jerry Brown mocked TX Gov. Rick Perry's radio ad inviting Californians to bring their business to Texas, and during his 'state of the state' address IL Gov. Pat Quinn proposed raising the minimum wage in Illinois to $10/hour.

Let's file these economic differences of opinions under the concept of 'federalism.' How to measure the effectiveness of each set of ideas under this concept? Here's one way: compare the different costs in moving from one state to the other by how much it is to rent a 26-foot moving truck (which would be large enough to move a 4br dwelling).

The rental price of a U-Haul from Los Angeles to Houston: $2,415.
The rental price of a U-Haul from Houston to Los Angeles: $1,140.

The rental price of a U-Haul from Los Angeles to Austin: $2,278.
The rental price of a U-Haul from Austin to Los Angeles: $1,075.

The rental price of a U-Haul from Chicago to Austin: $1,536.
The rental price of a U-Haul from Austin to Chicago: $704.

The rental price of a U-Haul from Chicago to Houston: $1,462.
The rental price of a U-Haul from Houston to Chicago: $552.

That seems to provide a stark comparison.

A Post-WWII History of the US Unemployment Rate

tpelia@yahoo.com (Tom Elia) — Tue, 06 Nov 2012 09:56:00 -0700

Monetary Policy Explained!

tpelia@yahoo.com (Tom Elia) — Tue, 23 Oct 2012 17:09:08 -0600

From Democratic Underground: (via Instapundit)

Let's say that you have the ability to print your currency using your computer printer, and every merchant accepted your printouts as a valid exchange for goods and services. You need to pick up your dry cleaning? You printout a $20 bill and your cleaners hand over your garments without question. Same would be true for your mortgage, groceries, car note, etc. Your creditors even accept your printouts as payment on your debts.

Given this, how can you ever be broke? Answer, you cannot be broke. The U.S. government is not in debt simply because it can create currency to pay off the debt, and our creditors gladly accept our currency as payment on our debts. You see, the world needs our dollars because the world needs oil, and in order to buy oil, you need dollars, which means that the world needs to stockpile dollars, and that means that the U.S. can print all of the money that it wants without incurring massive hikes in interest rates to attract lenders.

Sky-High Spending, Not Bush Tax Cuts, Drives Deficits

tpelia@yahoo.com (Tom Elia) — Thu, 18 Oct 2012 11:42:00 -0600

Investor's Business Daily's John Merline:

According to the latest budget forecast from the Congressional Budget Office, even if every expiring tax cut were kept in place permanently -- including all the Bush tax cuts, and various other expiring cuts from last year and this year -- and even if the alternative minimum tax were permanently indexed to inflation, federal revenues would still rise to 18.6% of GDP by 2022.

To put that figure in perspective, between 1948 and 2008, federal taxes averaged 18% of GDP.

What's more, despite countless changes to the tax code -- which included raising the top rate to 90%, then lowering it to 28%, then raising it and lowering it again -- taxes as a share of GDP have rarely deviated much from that average.

So, even if all the Bush tax cuts were made permanent, federal taxes would end up slightly higher as a share of GDP than the historic average.

The CBO report also makes clear that it's out-of-control federal spending that's driving the deficits.

According to that report, the federal spending as a share of GDP is on track to steadily rise over the next decade and beyond, reaching 22.3% of GDP by 2022.

That's significantly higher than the 1948-2008 average, and much higher than it's been under previous Democratic presidents. In President Clinton's last year in office, for example, federal spending consumed just 18.2% of GDP.

Two Different Recoveries

tpelia@yahoo.com (Tom Elia) — Wed, 17 Oct 2012 14:45:00 -0600

From Investor's Business Daily:

The Liar

tpelia@yahoo.com (Tom Elia) — Mon, 15 Oct 2012 00:03:00 -0600

(Cartoon by Michael Ramirez)

Obama's Track Record

tpelia@yahoo.com (Tom Elia) — Thu, 27 Sep 2012 07:56:00 -0600

(Source: www.republican.senate.gov)

What business leaders must do to save America

tpelia@yahoo.com (Tom Elia) — Thu, 20 Sep 2012 20:39:00 -0600

IPhone 5 Will Be More Help Than QE: Former Fed Gov

tpelia@yahoo.com (Tom Elia) — Mon, 17 Sep 2012 07:59:00 -0600

Former Fed governor Kevin Warsh on current monetary policy, in an interview with CNBC: (video at link)

"The Fed's goal is to be focused on the labor market in addition to other things," he said during a "Squawk Box" interview. "What concerns me about it is in my view the Fed can't do much more to lower the unemployment rate. The Fed is rightly dissatisfied. But the iPhone 5 is going to do more for the real economy than QE3."
...

"If we continue the policies we've been going down, then it would be taking risks we need not take as a country," he said. "If you look at the markets now, where asset prices continue to melt up, where asset prices are driven less by fundamentals and particular companies and more by speeches and policies that come out of Washington, you're taking these risks. Risks are highest in the economy when measures of risk are the lowest."

Effective 2011 Federal Tax Rates by Cash Income Percentile

tpelia@yahoo.com (Tom Elia) — Fri, 07 Sep 2012 11:12:00 -0600

Here are the effective tax rates for 2011, paid by cash income percentile (this includes all income, payroll, corporate, and estate taxes):

The lowest quintile paid 0.8% of its income in taxes.

The second lowest quintile paid 5.9%.

The middle quintile paid 12.6%.

The second highest paid 16.7%.

The top quintile paid 24.5%.

The average was 18.8%.

Here's a breakdown of the top quintile:

The top 10%-20% paid 19.5% of its income in taxes.

The top 5%-10% paid 21.6%.

The top 1%-5% paid 25.0%.

The top 1% paid 30.4%.

The top 0.1% paid 32.1%.

Whole Foods' John Mackey on The Moral Case for Capitalism

tpelia@yahoo.com (Tom Elia) — Sun, 12 Aug 2012 00:03:00 -0600

Milton Friedman -- Freedom vs. Tyranny & Misery

tpelia@yahoo.com (Tom Elia) — Tue, 31 Jul 2012 16:48:35 -0600

Why Are Keynesians of All People Calling for Tax Increases in a Crap Economy?

tpelia@yahoo.com (Tom Elia) — Mon, 30 Jul 2012 00:03:00 -0600

Good question... Maybe it's all about the politics.

Five myths about free enterprise

tpelia@yahoo.com (Tom Elia) — Sun, 15 Jul 2012 00:03:00 -0600

The American Enterprise Institute's Arthur Brooks has penned a terrific piece, which lists 'em.

A Fourth of July Thought for the Day

tpelia@yahoo.com (Tom Elia) — Wed, 04 Jul 2012 10:14:00 -0600

Read the Declaration of Independence here.

Many of the complaints against the King will be forever timeless.

"He has erected a multitude of New Offices, and sent hither swarms of Officers to harrass our people, and eat out their substance."

'Twas ever thus, unfortunately.