Friday, April 29, 2011
Keynes vs. Hayek--Round Two
Round One: Fear the Boom and Bust
(HT Patrick Peterson)
Thursday, April 28, 2011
The poor are getting richer.
“By leaving out additional sources of income – like fringe benefits or employer-provided health insurance – past studies have dramatically understated American households’ access to after-tax resources.” said Dr. Burkhauser. “What we found is that the rich did get richer over the last 30 years, but so did the middle class, the working class and the poorest...
This isn’t a zero sum game, where one group wins at the expense of others. The growth in productivity of Americans in the top twenty percent of tax units increased the size of the economic pie sufficiently to register major gains across the entire distribution of after-tax income.”
Read more here and here.
Wednesday, April 27, 2011
American Dependence on Government Assistance Highest Ever
Americans depended more on government assistance in 2010 than at any other time in the nation's history, a USA Today analysis of federal data finds. The trend shows few signs of easing, even though the economic recovery is nearly two years old.
- A record 18.3 percent of the nation's total personal income was a payment from the government for Social Security, Medicare, food stamps, unemployment benefits and other programs in 2010.
- Wages accounted for the lowest share of income -- 51.0 percent -- since the government began keeping track in 1929.
The wage decline has continued this year.
- Wages slipped to another historic low of 50.5 percent of personal income in February.
- Another government effort -- the Social Security payroll tax cut -- has lifted income in 2011.
- The temporary tax cut puts more money in workers' pockets and counts as an income boost, even when wages stay the same.
From 1980 to 2000, government aid was roughly constant at 12.5 percent. The sharp increase since then reflects several changes: the expansion of health care and federal programs generally, the aging population and lingering economic problems.
- Total benefit payments are holding steady so far this year at a $2.3 trillion annual rate.
- A drop in unemployment benefits has been offset by rises in retirement and health care programs.
- Americans got an average of $7,427 in benefits each in 2010, up from an inflation-adjusted $4,763 in 2000 and $3,686 in 1990.
- The federal government pays about 90 percent of the benefits.
Source: Dennis Cauchon, "Americans Depend More on Federal Aid than Ever," USA Today, April 26, 2011.
For more on Tax and Spending Issues:
For an excellent commentary and further elaboration see TANSTAAFL at Small Thoughts.
Monday, April 25, 2011
Poverty is Easy to Explain
by Walter Williams
There is very little either complicated or interesting about poverty. Poverty has been man’s condition throughout his history...The true mystery is why there is any affluence at all.
Friday, April 22, 2011
WINTP goes Hollywood
On Tax Day, CEI released this year's edition of Ten Thousand Commandments, an annual report by CEI Vice President Wayne Crews. Every year, Crews tallies up the compliance costs of federal regulations and explains how these costs constitute a huge hidden tax imposed on American consumers. In 2011, according to Crews, regulations costs American taxpayers $1.75 trillion. Read the full report here.
Thursday, April 21, 2011
How was 2008 like 1936?
This is NOT a sustainable trend.
Read more here. (Third article down)
Wednesday, April 20, 2011
"Quality Bonuses"--Grease for the Squeaky Wheels
— Millions of seniors in popular private insurance plans offered through Medicare will get a reprieve from some of the most controversial cuts in President Obama's healthcare law.--LA Times 4-20-11
Tuesday, April 19, 2011
Why Science and Politics Should Not Mix, Part 2
"We have long known that some places...offer high-quality care at costs below average."
--Barak Obama, 09-09-2010, Joint Session of Congress
“[O]ne of the biggest signals of inefficiency in American health care is the massive regional variation in cost and health outcomes…yet the higher cost areas and hospitals don’t generate better outcomes than the lower-cost ones. The result is an estimated $700 billion a year spent on health care that does nothing to improve patient health.”
-- Peter Orszag, OMB blog post, 05-28-2009
It ain't so much the things we don't know that get us into trouble. It's the things we know that just ain't so.
--Josh Billings, and several others
Dartmouth researchers have associated the unexplained portion of geographic variation with the supply of specialist physicians or hospitals, potentially leading to incorrect inferences about the causes of geographic variation—so-called supplier-induced demand. However, recent studies indicate that health status is a more important factor driving variation in spending than previously believed and that demographic and economic factors, as well as the structure of local health care markets, shape patient preferences and provider practice styles in far more complex ways than early analyses suggested. High spending might reflect inadequately measured health status or some other factor, such as poverty.
This is a point that Buz Cooper has been making all along. These arguments may seem a tad wonky--and I suppose they are--but the crucial issue is that the original findings of the Dartmouth Atlas study were very prominent in justifying the new health care control law--and now it's announced those results were unreliable at best, and more likely just plain wrong.
Monday, April 18, 2011
So what exactly CAN I call the new health care control law?
Sunday, April 17, 2011
Traditional Medicare, being immune from market forces (though not political forces) can counter that provider market power, essentially setting “below market” prices by fiat. (Don’t go thinking this is an affront to a perfectly competitive market. High provider market power is itself a deviation from a perfect market.)
I don't understand the fascination some economists have for the "perfectly competitive market."
Friday, April 15, 2011
Where do your federal tax dollars go?
Tax Day, and my in-laws wedding anniversary. (This year it's their 60th!!)
Today I received an email from David Plouffe, Senior Advisor to the President. (Bet you didn't know I had such powerful friends.)
Here it is:
Have you ever wondered how much of your own tax dollars actually go to support foreign aid? To support education? Well, now you can find out – and you might be surprised.
In his State of the Union Address, President Obama promised that this year, for the first time, American taxpayers would be able to go online and see exactly how their federal tax dollars are spent.
So today, we’re announcing the first-ever federal taxpayer receipt. Check it out:
Just enter a few pieces of information about your taxes, and the taxpayer receipt will give you a breakdown of how your tax dollars are spent on priorities like education, veteran’s benefits, or health care.
Senior Advisor to the President
I decided to give it a try. Plugged in my Social Security tax, Medicare tax and Federal Income tax. Then I calculated how much of my tax is spent on the military, the courts and the police---the only three legitimate areas of government action.
If government was reduced to its proper function of protecting our inalienable individual rights to life, liberty and property, I could pay 60% less tax. More importantly, I would have 60% less my property expropriated by the very institution designed to protect my property.
Something to think about.
Government needn't be so large and our liberty so diminished.