All posts by Mike

Fair Tax, Politics, Taxes and Spending

The Prebate Problem

Maybe I’ll post this over one at of the Neal Boortz boards just to see the fur fly. Like the supporters of any sweeping policy — socialism, neoconservatism or liberalism — Fair Tax supporters can’t admit that anything might be wrong with their ideas. The commenter on this post is smart, polite and makes some good point. But he still can’t resist telling me I’ll get a bigger paycheck or getting more focused on what the Fair Tax does right (“eliminate” the IRS and give you your “full” paycheck”) than what it does wrong.

My biggest problem with the Fair Tax is the prebate. For those of you who don’t know, this is the check the government writes to every family that “prebates” the tax they are being charged for the basic necessities of life. It’s what supposedly makes the Fair Tax fair.

But as far as I can tell, there are several massive problems with this:

  • The prebate puts the lie to the idea that the Fair Tax will eliminate the IRS. Who is going to make sure that people aren’t claiming a bigger househould than they have? If I’m going to claim a prebate for a family of four, I will have to give the IRS the identities of all four family members and they will have to check to make sure none of them are being claimed elsewhere (Imagine the nightmares for divorced parents. Do they each claim a Solomon-esque half a child?). I’m sure that will never go wrong. I’m sure no parent will ever get arrested for claiming a household member with a social security number that an illegal alien is also using.

    Granted, this is a massive improvement on the current situation in which the IRS can arrest you for incorrectly filing out a form based on their instructions. But it doesn’t “eliminate” the IRS; it merely reduces it.

  • If that were the only problem, I’d support the Fair Tax. But the prebate is also massively unfair. It prebates the amount of tax a family will pay on a certaining spending allowance that is set by the government. It is a uniform amount for the entire nation. This is ridiculous. A family of four in NYC might pay $30k for the cost of living but get prebates based on $25k. A family of four in New Braunfels might pay $20 for the cost of living but get a prebate based on . . . $25k. By my reckoning, that means the family in NYC just paid $1150 to the family in New Braunfels.
  • The prebate will become the most massive middle-class subsidy in American history. There will suddenly be 200 million people clamoring for the amounts to be raised. Do you not think the first Presidential campaign after the Fair Tax will have the Dems promising to raise the tax rate, while raising the spending allowance to $50k? After all, that’s just above the median family income.
  • Some Fair Taxers want the spending allowance tied to the poverty rate to prevent just this thing. But that only makes the problem worse. Now instead of poverty advocates clamoring to raise the povery rate, everyone will be — which mean an explosion in anti-poverty spending.
  • Do we really want a generation of Americans growing up who expect a monthly check from their wonderful government? Every April 15, Boortz clamors against those who say, “I didn’t pay any tax today! I got some back!” Well now, 300 million Americans will be saying that every month.
  • Ask the nearest Social Security recipient if they have ever had any problems getting their check. You might hear a colorful answer. Do we really think the federal government, whose computers are older than I am, is going to pass out nearly two billion checks a year without a hitch? That we won’t have some family missing a mortgage payment because they didn’t get their prebate? That they won’t accidently put $2 billion into some old lady’s account? Dream on.

    • There are other criticisms of the Fair Tax, but the prebate is the deal-breaker for me. It has always sounded odd to me and the more I think about it, the dumber the idea seems.

    All right, Fair Tax partisans. Fire away! Just keep in mind:

  • I’d love to “eliminate” the IRS too. The IRS was a constant foe of my grandfather and may have played a key role in my uncle’s fatal heart attack. I’m no fan of the current system at all.
  • I don’t care what, if anything, Scientology had to do with the Fair Tax. Hitler came up with the basic principles of mechanized warfare – ideas that we still use today. Good ideas can come from bad sources.
  • The statement that prices won’t go up but my take-home pay will is not true. And the man who has said so is Neal Boortz.
  • I realize the Fair Tax has advantages over the current system. I love that the Fair Tax people are stirring the debate. I’m on your side. I just think there are better ideas out there. The flat tax. A VAT. I don’t think this is the way to go.
    • News

    The Price Of Inertia

    I”m just too lazy to care. It’s just easier to go with the idiots.

    I had to renew my subscription to Norton Internet Security today. So far, I’ve been happy with it over three years. I haven’t had any virus or malware problems on my PC since a a few years ago when I erased the hard drive and reinstalled everything. I do wonder if it’s slowing down my machine, as many have alleged and the “will you allow this” pop-ups are annoying as hell. But I use my PC mostly for games anyway. Granted all my financial records are on there, but they are backed up on the mac (This is also intertia since I started keeping financial records on MS Money back in ’97 and am too lazy to move everything to Quicken). Most of my serious computing is reserved for the powerbook on which I am typing this.

    So I tried to renew today and the software key I was given when I subscribed two years ago doesn’t work. I have to go online and download new software. There I discover that once I purchase it, I will not be able to redownload after 60 says unless I pay an extra $9.

    I’d uninstall and go with something else … except that both Norton and McAfree install malware that prevents you from using a competitor’s product. I have neither the time nor the will to extract NAV from my system and find another product. So I’ll renew it for one more year. Next year, I’ll probably get a new PC anyway and not bother with these guys anymore.

    Law and Order, Politics

    Saturday Linkorama

  • I meant to comment on the Kennedy Brewer case when I saw it in the NYT as it seemed bizarre. Prosecturs continue to push a case despite exonerating DNA evidence? But then, Balko beat me to it with an even more alarming summary.

    It’s scary the lengths that some prosecutors will go to in order to be right.

  • I could never stand Robert Reich. His smary know-it-all way of uttering complete crap grated on my soul. Ronald Bailey now shows that, when it comes to economics, Reich has always been wrong. Always. Often spectacularly. But he’s revered by the Left.

    Incidentally, Reich wasn’t the only idiot telling us we needed to adopt Japan’s MITI model to get our economy working. A huge number of Democrats embraced the idea, including Algore. I never thought I’d say this, but thank goodness for the economic policies of Bush Sr.

  • Jeff Taylor makes the case against a subprime bailout. There’s never a problem that government can’t step in and make worse. Did we not learn our lesson with S&Ls? Apparently not. Bailing out the borrowers now is only going to mean bailing them out again in the future.

    I guess now we can count a mortgage among people’s “rights”.

    I like the description of the Bushies as “uber-nannies”. I’ll have to steal that.

  • Good for the judge. The National Security Letters are abuse waiting to happen. Remember, this administration wants to crack down on perfectly legal internet porn. And what better way to start than to, without court review or public disclosure, get a record of everyone’s internet activity? I have no problem with the government reading the e-mail of terrorists. I have a problem with them going on fishing expeditions.

    You know, conservatives used to stand against things like Carnivore. Sigh. Those were the days.

    There’s something else disturbing here. This is another instance in which Congress has tried to pass a law forbidding judicial review of said law. This is absolutely unconstitutional. The Constitution authorizes Congress to determine the jurisdiction of the federal courts — but this is clearly to decide whether a case goes into state or federal court. It is not intended to allow Congress to create little sanctuaries within the law in which they can do whatever the hell they want.

    • Sports

    Double Standards

    Jayson Stark has an outstanding article at ESPN on the recent HGH story that netted Troy Glaus, Rick Ankiel and Rodney Harrison. He points out the double standards. PEDs used by people we hate (Bonds) are vile; they’re forgivable when used by players we like. And a PED scandal in baseball is the end of the world; in football it’s no biggie.

    Pathetic.

    Politics

    About Manufacturing

    Read this:

    The United States makes more manufactured goods today than at any time in history, as measured by the dollar value of production adjusted for inflation — three times as much as in the mid-1950s, the supposed heyday of American industry. Between 1977 and 2005, the value of American manufacturing swelled from $1.3 trillion to an all-time record $4.5 trillion, according to the Bureau of Economic Analysis.

    …

    North Carolina encapsulates the forces remaking American manufacturing. Between 2002 and 2005, the state lost 72,000 manufacturing jobs, about three-fourths in textiles, furniture-making and electronics, according to the North Carolina Commission on Workforce Development. At the same time, the state has become a rising powerhouse in lucrative new manufacturing sectors such as biotechnology, pharmaceuticals and sophisticated textiles.

    Now watch Lou Dobbs’ ignorant head ‘asplode.

    Politics, Socialism

    Hypocrisy

    Radley Balko one the hypocrites supporting the “living wage” . . . for everyone else.

    I’m reading Do as I Say, Not As I Do right now, which catalogues a lot of these instances. I’ll post a full review over at Amazon. I’m not terribly impressed with the book, actually, since a lot of it reads as Moore-eque “gotchya” style of poking through a multi-millionaire’s portfolio and finding objectional investments or bad behavior by a company they are absentee shareholders in.

    Not to mention lots of rumor-mongering.

    But more on that later.

    Politics, War on Terror

    Imagine That

    Last night, we had a political grandstandfest, er, debate. And there was an actual, you know, exchange of views.

    The thing is that both men are right. We do have an obligation to try to fix Iraq and we do have an obligation to leave if it can’t be fixed.

    We need more moments like this. I feel a tide turning in this country — away from buzz words, one-liners and demagoguery to serious discussion. Or discussion anyway. Thank God for people like Ron Paul who’ve had the temerity to mix it up and the eloquence to do in a way that can’t just be sound-bitten away.

    Politics

    We Didn’t Do Anything Wrong?

    Jonah Goldberg reminds us of how the media screwed up Katrina:

    But there was one thing missing from the coverage of this natural, social, economic and political disaster: the fact that Katrina represented an unmitigated media disaster as well.

    Few of us can forget the reports from two years ago. CNN warned that there were “bands of rapists, going block to block.” Snipers were reportedly shooting at medical personnel. Bodies at the Superdome, we were told, were stacked like cordwood. The Washington Post proclaimed in a banner headline that New Orleans was a “A City of Despair and Lawlessness,” insisting in an editorial that “looters and carjackers, some of them armed, have run rampant.” Fox News anchor John Gibson said there were “all kinds of reports of looting, fires and violence. Thugs shooting at rescue crews.”

    TV reporters raced to the bottom to see who could moralistically preen the most. Interviewers transformed into outright scolds of administration officials. Meanwhile, the distortions, exaggerations and flat-out fictions being offered by New Orleans officials were accelerated and amplified by the media echo chamber. Glib predictions of 10,000 dead, and the chief of police’s insistence that there were “little babies getting raped,” swirled around the media like so much free-flowing sewage.

    Do you think they’ll ever own up to their hysteria? Don’t count on it. The media never do wrong.

    Sports

    Collective Cowardice

    ESPN’s gurus have officially whimped out. Here are their collective cowardly picks for the 2007 NFL season. As I noted before, there is typically a 50%+ turnover in the NFL teams that make the playoffs from year to year. Regressions to the mean is one heartless bitch. We can expect at least six and probably seven of last year’s playoff teams to be watching them on TV this January. We can also expect six or more groups of last year’s disappointed fans to be happily freezing to death come Christmas time as they paint their team’s color on for the wild card or divisional round.

    So what I want to know from the experts is this: Which teams will stumble? Which ones will surprise? Who’s a sleeper? Come on. Dazzle us by picking Cleveland to win the Super Bowl or something.

    Well the brave ESPN analysts, people paid for their insight, have given us an exercise in pussy groupthink.

  • All 16 expect New England to take the AFC East division again.
  • Eleven of 16 tap Baltimore to repeat in the AFC North, with two more giving them the wild card.
  • Fourteen of 16 expect Indy to repeat in the AFC South, with the other two bodly predicting a wild card while Jacksonville take the division.
  • All but one expect San Diego to take the AFC West once more, with the outlier only prediciting Denver will knock them back to the wild card.
  • Nine of 16 expect Philadelphia to repeat as NFC East champ. Seven more say they take the wild card with Dallas winning the division.
  • All 16 expect Chicago to repeat as NFC North champ and New Orleans to repeat as NFC South champ.
  • 9 of 16 expect Seattle to repeat as NFC West champ and five of the remainder expect a wild card with St. Louis or San Fran taking the division. Wow, that’s almost controversy.

    • As for the wild card teams, the most likely to fall off the Earth, they have a little more courage. Eight expect Dallas to repeat as wild card; seven tap them to win the division. Only two pick the Jets to make it again and no one thinks the Giants or Chiefs will repeat. The most common wild card picks are Denver (10 votes + 1 division win) and Cincinnati (eight votes plus four division crowns), Dallas and Philly (15 of 16 expect both to make the playoffs) and Seattle (five votes – after nine to take the division).

    Buffalo, Miami, Cleveland, Tennessee, Houston, Kansas City, Oakland, Giants, Minnesota, Atlanta, Tampa Bay and Arizona are given no chance at the playoffs. Washington, Green Bay and Detroit are given only one vote. I boldly predict that at least one of those teams will make the playoffs and probably at least one will win their division. I’m really surprised no one picked Green Bay to do anything since a) their defense is excellent; b) they have an easy schedule; c) they finished 8-8 last year; d) the media worships Favre.

    OK, maybe this is some collective wisdom of crowds thing. After all, the collective picks of Yahoo! users from week-to-week always outperform the analysts because, even though most of them picks lots of upsets, collectively they all pick favorites. Maybe the ESPN analysts understand there will be a lot of turnover, but aren’t agreed on where it will happen.

    Nope. Breaking the picks down coward by coward:

  • Len Pasquerelli has spinelessly picked seven of the 2006 division winners and nine of the 12 2006 playoff teams to repeat.
  • Jeffrey Chadiha goes Bert Lahr on us — picking seven division repeats and nine playoff repeats.
  • Mike Sando raised the level of sissyness, picking all eight division winners to repeat along with one wild card team.
  • Matt Mosley has the most craven set of picks I’ve ever seen. He picks all eight division winners to repeat and ten of the twelve playoff teams to do so. He even chickens out with the awards, boldly predicting Ladanian Tomlinson, Bill Belichick, Tom Brady and Brian Urlacher to take home hardware. Um, Matt, did you get this year’s picks mixed up with last years?
  • Sal Palantonio has only six division repeats and boldly predicts Indy will lose the division. But then he goes namby-pamby, picking nine overall repeats.
  • Mike McAllister boldly predicts only five teams to repeat their division, but the goes all milksop by having nine repeat playoff teams.
  • Michelle Tafoya is the only analyst with any balls. She only picks seven teams to make the playoffs again and only four teams to repeat as division winners! I guess women just don’t understand football.
  • Joe Theismann shows there are still a few bone fragments floating in his brain by picking all eight division winners to repeat, along with one wild card team. He gets bonus points, however, for picking Detroit to make the playoffs. That’s bold if nothing else. He is matched identically by Mark Schlereth (8/8 and 9/12), who has neither the leg excuse nor the beautiful Detroit pick to make up for this display of wimpiness.
  • Merrill Hodge is almost brave, but goes baby by picking six division repeats and eight playoff repeats. Eric Allen is in the same boat, picking seven of eight division winners to repeat and eight of twelve playoff teams.
  • I love Tom Jackson. But come on, TJ. You’re a big guy. Be bolder than picking six division winners and eight playoff teams to repeat.
  • Michael Smith goes a yellow-belly 6/8 on division winners and eight of 12 on playoff teams.
  • John Clayton has a weak 7/8 division winners and nine of 12 playoff teams repeating.
  • Scott Symes closes it up with a cowardly 6/8 and nine of 12.

    • Now, fun aside, I understand why they do this. It’s the same reason the fans do. We know that half of last year’s playoff teams will be playing pinochle by New Year’s. We just don’t know which half. And to be honest, if you were a betting man, you’d probably bet on teams to repeat, since you’ve got a 50% chance of winning that bet against only a 25% chance betting on any team that didn’t make the post-season last year.

    It’s the old Final Four Dilemma. Picking all favorites is the safest and most rational course since the favorites are the most likely to win. Of course, if you do nothing but pick favorites, you won’t win the betting pool. So most people pick lots of upsets and either end up in first or last place, depending on whether they picked the right upsets or not. There’s always the potential of looking silly if you pick Weber State to win it all. But anyone who tapped George Mason two years looked like a genius. And as Spanky says, why not at least have fun?

    No one except Gregg Easterbrook is going to remember who made what NFL prediction when January 2008 rolls around. So why not have fun? Why not go out on a limb and say this is the year New England stumbles? Or be bold and predict the Falcons will be better off without Vick. Something. Anything. I don’t need to turn on ESPN to see a bunch of favorites get picked. I can do that all on my own.

    Easterbrook himself went with Football Outsiders picks. The boys over at FO would laugh if anyone took their 0.1 win precision predictions seriously. They’ll be the first to tell you that error bars on those numbers are a few wins, give or take. The entire league is not going to finish sandwiched between 5 and 12 wins. Some team will have a great year and lump up 14 victories. Some team will be awful and only manages two (my money’s on the Raiders for that achievement).

    But even the spineless computers only pick two division winners and six playoff teams to repeat. They project a strong AFC North, a surging Jacksonville, bad stumbles and missed playoffs for the Chargers, Cowboys and Saints and the Packers taking the division from the Bears (although I should note that FO thinks that the Saints’ prediction is wrong — the computer is being fooled by the Katrina Year).

    Maybe they’re wrong, but at least they’re interesting. At least they’re fun. At least there’s insight. Congratulations, ESPN. You have fewer balls and less sense of adventure than a lump of silicon microchips.

    Politics

    Africa

    I recently happened to see Blood Diamond at the same time that I was reading Ismael Baeh’s riveting but disturbing A Long Way Gone. Both are concerned with the horrendous civil war that wrenched Sierra Leone.

    I, of course, had known nothing about it. African civil wars, genocides and massacres are extremely under-reported in this country. Everyone has heard about Darfur but has anyone heard of the Congo war that wiped out three million people? Where are the Hollywood celebs tossing away their iPods because of the coltan?

    Of course, whenever I read about Africa, I keeping coming back to the obvious question: can it be saved? Is the continent doomed to be the perpetual stomping ground of the Four Horsemen?

    It’s obvious that foreign aide isn’t working as we’ve poured billions in it for no apparent effect. It’s obvious Bono isn’t working although maybe if we keep sending him there, someone will shoot him. The various ism’s of socialism and islamism are only making things worse, as we could have expected. What can we do? Invade? Yeah, that’ll work. Throw in more money? Yeah, more money always solves complex problems.

    I’m just an egghead astronomer who likes to read, not an expert on Africa or poverty or warfare. But given the track record of people who are experts, I don’t see that detailed knowledge is necessarily helpful. Perhaps if a million monkey decendants type on a millions blogs, someone will create the perfect plan to save Africa.

    So here are my thoughts. At the very least, I can’t be stupider than Bono.
    Continue reading Africa →

    Politics

    Merck

    I noticed the hatchet job the NYT did on Vioxx a couple of weeks ago, made a not to comment on it and forgot. Well, Point of Law does the job for me.

    So the NYT write a poorly informed Page 1 article castigating the eevil Merck is dragging its feet paying out people who can’t actually prove that they had heart attacks because of Vioxx. No, no bias there. Move along. Nothing to see.

    Sports

    Go Mountaineers!

    A wonderful article on the best college football game this year, unless Boise State manages to thrill us again.

    Michigan had never played a I-AA opponent in its history. Now we know why, the Wolverines were ducking them.

    Instead of an easy tune-up for Michigan, Appalachian State leaves with its most profound victory ever and a check for $400,000 that was supposed to be their pay for getting punished.

    How sweet it is. I hope this happens to every contender. It seem to be that college football has developed a lot more parity in recent years. I love it.