WILLisms.com on Twitter
The Babe Theory Of Political Movements.
Mar. 21, 2005 11:50 AM
Iran's Sham Election In Houston.
June 20, 2005 5:36 AM
Yes, Kanye, Bush Does Care.
Oct. 31, 2005 12:41 AM
Health Care vs. Wealth Care.
Nov. 23, 2005 3:28 PM
Americans Voting With Their Feet.
Nov. 30, 2005 1:33 PM
Idea Majorities Matter.
May 12, 2006 6:15 PM
Twilight Zone Economics.
Oct. 17, 2006 12:30 AM
The "Shrinking" Middle Class.
Dec. 13, 2006 1:01 PM
From Ashes, GOP Opportunities.
Dec. 18, 2006 6:37 PM
Battle Between Entitlements & Pork.
Dec. 21, 2006 12:31 PM
Let Economic Freedom Reign.
Dec. 22, 2006 10:22 PM
Biggest Health Care Moment In Decades.
July 25, 2007 4:32 PM
Unions Antithetical to Liberty.
May 28, 2008 11:12 PM
Right To Work States Rock.
June 9, 2008 12:25 PM
Social Security Reform Thursday.
January 29, 2008
Caption Contest Archive
Jan. 21, 2009
The Carnival Of Classiness.
Mar. 14, 2006
Quotational Therapy: Obama.
Apr. 4, 2008
Mainstream Melee: Wolfowitz.
May 19, 2007
Pundit Roundtable: Leaks.
July 9, 2006
A WILLisms.com(ic), by Ken McCracken
July 14, 2006
Powered by Movable Type 3.17
Site Design by Sekimori
WILLisms.com January 2009 Book of the Month (certified classy):
The WILLisms.com Gift Shop:
This Week's Carnival of Revolutions:
Carnival Home Base:
Trivia Tidbit of the Day: Part 565 -- Government Debt Not Just Federal Problem.
Some States Are Borrowing Way Too Much-
The national debt held by the public is staggeringly large these days. Its growth has been robust and persistent. It is also projected to nearly double over the next decade, according to many forecasts.
State and local government debt is also on the rise in some places and on average (.pdf):
From the perspective of average taxpayers, debt financing should be minimized. It is more costly that payas- you-go financing because of the interest payments incurred. It also comes with an overhead cost in the form of the large municipal bond industry, which employs tens of thousands of lawyers and finance experts in underwriting, trading, advising, bond insurance, and related Wall Street activities.
The existence of some debt is not a bad thing at all. Zero debt would signal a dysfunctional and unhealthy economy, but we've passed the point of healthy debt in most states and locales, as well as the federal government:
Who do you think is more reliable—the full faith and credit of the United States backing up Treasury bonds, or the McDonald’s Corporation, backed only by “billions and billions served”? By some market measures it is the latter, and for good reason. The price of credit defaults swaps guaranteeing payment on 10-year Treasury bonds has risen by 1000 percent since December 2007, with an implied 12 percent probability of default on government debt over the next decade. In the view of the markets, this makes U.S. government bonds a more risky proposition than debt issued by McDonald’s.
Issuing bonds, much like earmarking money for pork projects, may seem somewhat innocuous, but in the same way that earmarking goes hand-in-hand with corruption, lots of municipal bonds can do the same thing. Often the two-- earmarks and bonds-- go hand-in-hand.
Imagine if a United States Senator slipped earmarks into a bill, and that Senator's husband issued the bonds associated with the earmarked projects. Imagine if this happened time and time again, over the period of many years.
In Texas, notwithstanding the hypothetical example above, our state and local debt per capita is 49th in the country. Only Tennessee has a lower rate of outstanding debt per capita. Number one: Massachusetts.
Previous Trivia Tidbit: Punitive Coke Taxes.
Trivia Tidbit of the Day: Part 564 -- Fat Taxes.
In an attempt to balance their state budgets, some Governors around the country have suggested new creative fees and taxes on cigarettes, iTunes downloads, strip clubs, and soft-drinks. The tax on soft-drinks would also mitigate obesity and therefore cut down on diabetes and other soaring health care costs, we are told. The Tax Foundation points out that the impact of a 58% tax on soft-drinks (which is similar to the tax level we have on cigarettes) would have a tiny impact on BMI:
According to Jason Fletcher, David Frizvold and Nathan Tefft, taxes on soda do appear to affect obesity, but the effect is very small. They estimate that a 1% increase in the soda tax rate decreases mean adult body mass index by 0.003. So, even if sodas faced a 58% tax rate (similar to the average effective tax rate on cigarettes) the authors estimate that mean BMI would fall by just 0.16 points. For contrast, mean American BMI has risen by 2.3 points between 1990 and 2006.
To put that into visual perspective, the brown is what the American BMI has risen by since 1990. The green is the anticipated BMI impact of a really aggressive and punitive coke tax:
That BMI impact is clearly not worth the drastically higher prices on sugary drinks.
Previous Trivia Tidbit: Measuring Political Corruption.
Trivia Tidbit of the Day: Part 563 -- Chicago Newspaper Says, "Hey, Look Over There!" On Corruption.
People in Chicago are upset that the Blagojevich situation has reminded Americans that their entire political establishment is woefully corrupt, so they got some Chicago Tribune interns to research corruption convictions around the country and prove that other states have it a lot worse:
Is this REALLY the best measure of corruption? Has Senator Chris Dodd been convicted yet? What about Congressman David Obey? Some of the most truly corrupt states and cities and political machines probably let certain people in power get away with whatever they want to get away with. In Minnesota, they pride themselves on being a "good government" state, meaning clean and open and so forth, but you just have to know that in Duluth and up in the Iron Belt, unions and political shenanigans just feed off of each other.
While I don't doubt that Louisiana has a lot of corruption or that Nebraska has very little of it, I just don't find a lot of value in this map.
Previous Trivia Tidbit: Medicare.
Trivia Tidbit of the Day: Part 562 -- Medicare.
Our Entitlements Are Out Of Control-
Watching a TiVo'd Frontline last night about our national debt, Forrest Sawyer seemed to place most of the blame on the Bush administration. The gist: Bush cut taxes, which starved the government of money, all while fighting a big war and signing the Medicare Prescription Drug benefit.
There is some truth to that criticism, but not much.
Tax relief did not starve the beast, as many hoped/feared. Tax collections were hitting record highs until we entered this housing bubble-caused recession. Revenue was abundantly flowing into the federal government. Revenue was not the problem.
Nor was military spending, or even the Medicare Prescription Drug plan. The cost of Afghanistan and Iraq have been staggering, but a) they are not permanent annual costs and b) our defense spending as a percentage of GDP is still historically low. While adding prescription drugs to Medicare will have a major negative impact on our fiscal picture over the long run, it has had very little impact on our deficits today. Drugs for seniors are such a minor drop in the bucket to this point.
So what's the deal?
Well, revenues were way up until the recession hit. Military spending was certainly up, but not by enough to account for our current deficit. Same with prescription drugs in Medicare. So why do we have these huge deficits? Surely, it's pork, right?
Nope. Not even pork. Pork is also a drop in the bucket, relative to the absurdly large spending leviathan we have created in Washington.
No, the biggest spending increases during the Bush administration were auto-pilot increases in Social Security, Medicare at-large, and Medicaid. Social Security is the largest individual spending program that Washington has right now. Bigger than war. And according to Chuck Blahous, the so-called surpluses are drying up a lot sooner than anyone imagined (watch starting at the 2:30 mark, through about the 7:00 mark).
But what about Medicare? Right now, Medicare is not the biggest problem. Social Security is much bigger. But over the long-term, Medicare as a whole (prescription drugs being a small part of that whole) dwarfs pretty much everything:
It has not always been this way. In 1985, Medicare drew only 0.4 percent of GDP ($17.9 billion) from the general fund to cover its excess costs. Ten years later, this had increased slightly to 0.5 percent of GDP ($37.0 billion). By 2007, Medicare's draw had more than doubled to 1.3 percent of GDP ($179 billion).
And it's only going to get worse... MUCH, MUCH worse.
Previous Trivia Tidbit: Schools.
Trivia Tidbit of the Day: Part 561 -- Funding Our Schools.
Everyone wants good schools for their kids. Schools are often something people cite when they decide where they want to locate themselves, their capital, and their businesses.
There is an impression out there that the path to good schools is the result of "more funding." That may be true in some cases, but let's examine the data:
We have seen massive increases in spending, even adjusted for inflation. We have also seen massive increases in per pupil spending.
Have we seen higher test scores, higher graduation rates, higher attendance rates, better discipline, higher achievement in the classroom, or any other tangible evidence of success?
No. We really haven't. We've been throwing money into a broken system, dominated by unions and bureaucrats.
Previous Trivia Tidbit: Regulating Carbon.
Trivia Tidbit of the Day: Part 560 -- Al Gore Gets His Wish.
Environmentalism Taking Precedent Over Economy-
Obama's EPA is on the verge of heavily regulating carbon dioxide. Their move will have a variety of impacts on the American economy, namely slower growth:
Economic losses, job losses: it looks like we're putting the environmental cart before the economic horse.
Previous Trivia Tidbit: Jobs Under The Democrats' Tenure.
Trivia Tidbit of the Day: Part 559 -- Democrats In Control.
Pretty amazing coincidence that we started tanking right around the time the Democrats took over Congress:
Previous Trivia Tidbit: Spending Per Household.
Trivia Tidbit of the Day: Part 558 -- Obama's Anti-Family Policies.
Obama's Tax Hike-
Cue the Howard Dean scream sound effect:
The 2009 federal spending surge is nothing short of historic. The 25 percent spending increase represents the largest non-war government expansion since the New Deal. Domestic discretionary spending (including stimulus funds) has been hiked over 80 percent over 2008 levels. As a result, Washington will run a budget deficit of 12.3 percent of GDP, by far the largest since World War II.
Previous Trivia Tidbit: Obama's Big Tax Hike.
Trivia Tidbit of the Day: Part 557 -- The Largest Tax Increase In American History.
Obama's Tax Hike-
Between 1953 and 1982—a period of high tax rates, spending growth, and applied Keynesian economics—the economy was in recession 21 percent of the time, inflation reached 13 percent, interest rates hit 19 percent, and the stock market grew only 5.4 percent annually.
Previous Trivia Tidbit: Obama's Budget.
Trivia Tidbit of the Day: Part 556 -- Obama Budgeting.
Government Growth On Steroids, Here We Come-
In the short run, this surge of debt would increase interest rates. The United States government would find itself competing with other deficit-ridden nations to borrow massive amounts of money from a shrinking pool of global savings. Although U.S. Treasury bills are a popular investment for domestic and international investors in these uncertain economic times, investors will shift out of them when the economy recovers, thereby raising interest rates. The steeply higher government debt levels will likely accelerate that increase in interest rates. These will slow down the economic recovery by making it more costly for businesses to invest and more difficult for families to afford home and auto loans.
Obama must be a one-termer. Republicans must retake at least part of Congress in 2010.
Previous Trivia Tidbit: Texas Leads In Openness.
Trivia Tidbit of the Day: Part 555 -- Texas Leads Nation In Transparency.
Texas Best For Open Government-
Over the past couple of years, the issue of government transparency has ascended to the forefront of the conservative movement. In many states and locales, there is a strange reluctance to let taxpayers see what they are paying for. There is a sense that bureaucrats, elected officials, and the like ought to escape the clutches of the pesky and counterproductive oversight process.
In Texas, though, Governor Rick Perry, Comptroller Susan Combs, and the panoply of think-tanks and watchdog groups have propelled Texas to the front of the line when it comes to governmental transparency:
The only state found to provide information online in all 20 categories was Texas. New Jersey was second with 18, North Carolina third with 17.
Texas leads the nation in a lot of areas. Unfortunately, Texas still has a lot of work to do at the local (city/county) level with regard to taxation and spending transparency. Even though the state government is a great example, many of our local governments, including our school districts, need to open up their books for taxpayers to examine.
Previous Trivia Tidbit: California's Big Government Employee Bonanza.
Trivia Tidbit of the Day: Part 554 -- California Keeps Digging.
When You're In A Hole, STOP DIGGING-
Even as California grapples with its 40+ BILLION dollar budget deficit, the number of government employees just keeps going up:
California state government's full-time work force continues to grow despite Gov. Arnold Schwarzenegger's order to freeze hiring amid a historic budget shortfall.
California, you really need to get a handle on your spending... you helped bring down the national economy. Now it's your responsibility to restore your fiscal balance sheet so the rest of us aren't paying for your problems.
Previous Trivia Tidbit: Declining Economic Freedom.
Trivia Tidbit of the Day: Part 553 -- American Economic Freedom Declining In 2009.
Losing Economic Freedom-
The Index of Economic Freedom shows that the United States is losing ground:
Let's get our act together.
Previous Trivia Tidbit: Card Check & EFCA Consequences..
Trivia Tidbit of the Day: Part 552 -- Card Check & EFCA Consequences.
Card Check Crud-
The United States Congress is flirting with passage of the Orwellian Employee Free Choice Act, which would end secret ballots for union organizing. This would have disastrous consequences for America.
Anne Layne-Farrar has a great study on the likely consequences.
Unions declined almost every year, year after year, until the Democrats took over Congress in 2006. Since then, we've seen a slight uptick in union density.
What would a major uptick in union density mean?
It would mean a lot more unemployment:
Overall, the cumulative effect of 1.5 million additional union members per year for 10 years will increase unemployment between 5.3 and 6.2 million with union density settling at just under 23%.
Don't do it, Congress. Don't do it, Obama. Leave us alone. Let us prosper.
Previous Trivia Tidbit: Too Many Emails.
Trivia Tidbit of the Day: Part 551 -- Email.
Have You Cleared Your Inbox Yet Today-
Email! It's 6:18 PM, and I am just now finishing sending the important emails for today.
Previous Trivia Tidbit: Obama's Approval Ratings Nothing Special.
Trivia Tidbit of the Day: Part 550 -- Approval Ratings.
Pretty Average Showing For Obama-
I keep hearing about how Obama is so popular and this and that. In reality, he's about average for this point in an administration:
Obama: pretty marginal.
Previous Trivia Tidbit: Corporate Taxes Are Too High In America.
Trivia Tidbit of the Day: Part 549 -- Taxes Too High.
Cut Taxes To Stimulate Real Growth-
For quite some time, the United States had a strong competitive advantage relative to other countries because of our low taxes. In recent years, however, nations all around the world have methodically lowered their tax rates to become more attractive for people, capital, and businesses. Now, Japan is the only country with a higher overall corporate tax rate than the United States. And many states in America have higher corporate tax burdens than even Japan:
It should be noted that these numbers are not total tax burden. Many of the other countries have higher personal income taxes, higher sales or VAT taxes, higher tariffs and fees, etc. Still, the fact that France has a lower corporate tax rate than Texas is disgusting. The United States corporate tax rate is dragging down Texas' competitive advantage.
Lost decade, here we come. Unless we do something about it.
Previous Trivia Tidbit: Kay Bailey Hutchison & Earmarks.
Trivia Tidbit of the Day: Part 548 -- Earmarks.
Pork Doesn't Measure Up To Entitlement Spending, But It Drives Overall Spending Upward & Corrupts Congress-
Chuck Schumer infamously derided (via YouTube) "the chattering classes" for focusing so much of their attention on the "little porky amendments" in the stimulus package.
In some ways, he had a point. The "pork" or "earmarks" made up only a small percentage of the overall disaster of a bill. But to paraphrase Yogi Berra, when you take a billion here and a billion there, eventually you're talking about real money. And pork is bad for more than the sheer dollars figures involved. It does at least two really, really bad things:
1. It contributes to a culture of overall spending growth. There is a strong correlative link between pork growth and growth in non-pork programs.
2. It corrupts. It causes legislators to trade their votes to get their home project funded. It proliferates lobbyists' hands in bills. Pork eliminates competition and transparency. It's bad for a lot of reasons, even though entitlements are the real driver of government spending.
Just take a gander at government spending growth in 2009, which includes more than 9,000 earmarks:
The American people hired Obama to put out a fire. He showed up and sprayed a tank full of jet fuel all over it. It's no wonder that the stock market has completely tanked over the past month or two and the unemployment rate has jumped up to 8.1% (.pdf). Just for reference, Texas' rate is also climbing but remains 1.7% lower-- at 6.4%.
Interesting, too, that Texas Senator Kay Bailey Hutchison wants to replace fiscally conservative Rick Perry as Governor, yet she is the 22nd biggest porker in the Senate, and she's the biggest porker in Texas:
WASHINGTON – Sen. Kay Bailey Hutchison fought against earmarks this week, urging her colleagues to trim wasteful spending from a $410 billion bill and even voting to strip all 8,500 earmarks from the measure.
Actually, the Senator was responsible for 113 earmarks totaling $267,153,966. A little higher than the 150 million figure in the Dallas Morning News.
She also said:
I do think that earmarks are a legitimate role of Congress.
How is that fiscally conservative? How does she think she can win conservative Republican primary voters with that mentality, especially looking at the latest Rasmussen numbers showing Governor Perry's rising approval ratings?
Previous Trivia Tidbit: Top 10% Rule.
Trivia Tidbit of the Day: Part 547 -- The University of Texas' Top 10% Rule.
A Good Problem To Have-
The Texas legislature is currently weighing whether to change the "Top 10% rule" for Texas' flagship university, The University of Texas at Austin. The Top 10% rule currently guarantees admission into UT for students who graduate in the top 10% of their Texas high school class.
It wasn't a terrible idea when it was dreamed up, but the rule is in need of some serious changes:
The flagship campus in Austin is increasingly the school of choice for students in the top 10 percent. Eighty-one percent of UT's freshmen from Texas enrolled under the law this academic year, and Powers said he expected that figure to rise to 86 percent for the entering class this fall.
Back in 1999, I probably would have gotten into UT one way or another due to test scores and extracurricular activities alone, but I was fortunate enough to benefit from the Top 10% rule. It was the easiest college application on earth. I was already in. Essentially, I just had to send in my declaration.
The Top 10% rule definitely provides high school students with certain incentives for performing well in class. It might also lead to complacency ("I'm in, even if I get straight Cs my entire senior year") in some cases, or defeatism ("there's no way I can get into the top 10%, so what does it matter?") in other cases.
In the past, I have bounced around the idea of a Top 5% rule for UT, while keeping the Top 10% for everyone else. The Top 10% rule currently applies to Texas A&M and other state schools, but they are not facing the same level of demand that UT now faces. At some point in the future, however, they may. In another decade or less, those other schools would need their own rule change.
In the immediate future, without a legislative change, the Top 10% rule will begin having serious negative consequences for UT. It's not an issue of whether the law should be changed, it's a matter of how and when it can be phased in/out.
Whatever happens, let's hope that we don't end up watering down the increasingly high-achieving UT student body. Let's make sure that we're not caving to the race card mongers on this issue by crafting rules that require quotas based on anything but achievement. Let's not take a step backward in our admissions selectivity. Let's promote diversity by seeking out the best and the brightest from around the country and the world, and let's reward only the very highest achieving Texas high school students with admission into our primary flagship university.
As someone with a vested interest in the value of my degree, I represent a lot of people out there who a) want to see a change and soon; but b) don't want to weaken the admissions criteria in the process.
So far, I like what I see from the legislature, but I am concerned that special interests on the left are lobbying hard on this issue and may try to undermine the very purpose of the change.
Previous Trivia Tidbit: Deregulation, Deschmegulation.
Trivia Tidbit of the Day: Part 546 -- What Deregulation?
The Myth Of Massive Deregulation Just Plain False-
There's this weird narrative out there that argues that we got into this economic mess due to negligent, wild west deregulation throughout the Bush administration. In fact, we got a lot more regulation over that period (much of it from unaccountable bureaucrats, but still):
For the most part, deregulation-- especially in the private sector-- was not the problem. Fannie and Freddie, being government-chartered entities run almost exclusively by former Clinton administration officials, should have been more regulated all along. Or they could have just let market forces (and true market risks could have been factored into the decision-making process) work all along. Imagine that.
Previous Trivia Tidbit: The Obama Economy.
Trivia Tidbit of the Day: Part 545 -- The Obama Economy.
Stop Blaming Others, Obama, This Economy Is Now Yours-
Obama and the Democrats are still blaming Bush for everything that is wrong with the world. Unfortunately for them, Democrats controlled Congress for more than two years now, and in terms of policy decisions, the past few years now have been guided mostly by left-of-center thinking. The alleged deregulation of the Bush years was largely mythical. The Bush tax cuts were mostly a first term phenomenon. Entitlement reform was kiboshed. Instead, programs were expanded, regulations added, and taxes in other nations began to make ours look high. With so much media attention on the Democrats' primary, the national policy mood was decidedly left-wing. There was no room for conservative ideas during that period.
More than that, regardless of who was in charge of turning the boom into the bust, Obama and Pelosi are now unequivocally in charge. And they are not inspiring confidence. At all.
Just take a gander at the market since Obama won:
As 2009 opened, three weeks before Barack Obama took office, the Dow Jones Industrial Average closed at 9034 on January 2, its highest level since the autumn panic. Yesterday the Dow fell another 4.24% to 6763, for an overall decline of 25% in two months and to its lowest level since 1997. The dismaying message here is that President Obama's policies have become part of the economy's problem.
Obama and the Democrats need to stop blaming others. They need to stop uttering phrases like, "we inherited such and such recession, or such and such deficit."
Even if you did inherit it, it's now yours.
As any clever trust fund kid knows, any money your rich parents spend on you now is just money that you won't inherit later on.
With that philosophy in mind, let's examine what the Democrats in Congress drained from their own inheritance in just the past year:
QUICK UPDATE: More buyer's remorse, from "moderate" David Brooks.
Previous Trivia Tidbit: Nuclear Power.
Trivia Tidbit of the Day: Part 544 -- Nuclear Power Is Green
Low Risk, High Reward-
An interesting graphic about the safety of nuclear power:
Of course, nuclear power is green, but NIMBYism creeps in when people factor in an improbable-but-possible catastrophe involving a nuclear power plant. As energy prices have cratered over the past six months, talk of viable alternatives has gone by the wayside. Unfortunately, although oil and gas prices are in what can really only be described as a bust, "punish the oil companies" talk has not subsided. The worst of all worlds with regard to longterm energy policy is upon us. We're eschewing nuclear and other viable alternative energy sources (because energy is cheap again), all while reversing "drill here, drill now" (which will = major fail and pain in the future).
When the economy does pick up steam again at some point after 2010 and demand for energy picks up accordingly, don't be surprised to see energy prices once again take their toll. And we still won't have viable alternatives in place.
So says the ant... to the grasshopper.
Previous Trivia Tidbit: School Choice.