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The worst form of inequality is to try to make unequal things equal.

Aristotle

income-inequality

You've heard about income inequality and have probably encountered many articles documenting trends over the last 30 years. Usually the conclusion of these articles is a statement that income inequality is a problem. But have you actually read about why it is a problem? Is it just class warfare attempting to stir up the masses and get votes for a political party? Has jealousy of rich risen? Has perceived conflict increased between the rich and poor, with movements such as Occupy Wall Street taking shape? Why are they so concerned that there are people out there who are so much richer than them? You hear more about the top 1% than the bottom 1% in the media. Why is that?

  • How is it reported?

First, let's begin with some background material on how income inequality is reported. It is generally measured in one of two ways: the Gini coefficient or income share trends. Both have generally been used in the media to document how unequal our society has become. A Gini coefficient of zero expresses perfect equality, where everyone has an exactly equal income, and a Gini coefficient of one expresses maximal inequality, where only one person has all the income. You may have read about how the Gini coefficient has been rising over time signaling that inequality has been rising (barely, if you bother to look at the details), but they are omitting critical information from which they draw their conclusion. They nearly always report on household inequality instead of personal income inequality. What's the difference, you ask? The latter looks at only the individuals, while the former looks households that may include dual earners. This is important because there has been much change in household dynamics of the modern era compared to times in the past, with more women entering careers dominated by men than ever before. This a critical piece of information because people marry other people who are similar to them, through assortative mating. Dentists marry other dentists, lawyers marry executives, teachers marry other teachers, etc... In fact, "across the member countries of the O.E.C.D., 40 percent of couples in which both partners work belong to the same or a neighboring earnings bracket, compared with 33 percent two decades ago," the New York Times reports. The assortative mating trend causes household inequality to rise, but does not cause personal income inequality to rise.

However, since the Gini coefficient is not widely understood by the general masses, the majority of articles in the media usually report on income inequality using the share of income gains or a time period of how much income the top 1% earned compared to some time in the past. They generally mention the top quintile and compare it to the bottom quintile and conclude that the situation is so dire because the top quintile outgrew the bottom quintile by a multiple, or some other simple scheme to make you focus on extremes. The ratio of the average CEO salary to the common worker are usually mentioned, and they will ask hackneyed questions like, "Does a CEO really do 100 times the work of the average worker?" Find out.

  • Creating controversy

Some liberal economists with agendas have written numerous books and newspaper opinion pieces on the subject, but there is one common problem with all these works: they are all opinions with little substance or backing of data. And they are usually opinions that confuse problems with our political system with income inequality. They opine on lots of things correlated to wealth and power, but they do not pinpoint why it is a problem that there are wealthier people out there than others. Because some of them have earned a memorial Nobel Prize in economics (although unrelated to economics of inequality), write for the liberal New York Times [1, 2, 3], and label themselves Democrats, chair the International Socialist Commission, argue against free markets, openly vilify entire industries such as banking [1, 2], they are given a platform to opine for their partisan politics. Most of their arguments detail problems with our political system where lobbyists have extreme power to influence representatives and senators, but then masquerade those political problems as problems resulting from income inequality. For instance, a reviewer of a book by Joseph Stiglitz writes, "The collective argument of these dissidents is not only that inequality violates moral values, but that it also interacts with a money-driven political system to grant excessive power to the most affluent." This is a problem with our political system where such activity is allowed and encouraged, not with having people with a lot of money. Even if most people's incomes were relatively equal, they would still band together like they do now and form groups and funnel their money to these groups to create 'wealthy entities' such as Union PACs. And how is inequality immoral, exactly? Inequality is a state of being, not a planned decision, which is what something would have to be to be immoral. It would only be immoral if someone was out there unfairly distributing income (they certainly don't seem to have a morality problem with the unfair tax code. I digress.) The authors have yet to show a real piece of evidence why inequality is in fact a problem, and not a response by a government that deems it to be a problem and creates policies that makes it a problem in a self fulfilling prophecy (below). Mostly the books involve a lot of 1% bashing and cater to the partisan politics crowd. I find it ironic that they sell a lot of books to the OWS crowd, get rich from these writings and become the people that their writings are so critical about and at the same time create even more income inequality with their prosperity. None of these books have the profits going to charity.

  • Why is income inequality supposedly bad?

So what are the main conclusions usually drawn to say why income inequality is bad? Some authors point to studies that found inequality led to slower growth in some countries. For those claimants who are really lazy, they just take a few countries in Africa and conclude that a high level of income inequality is the reason for their poverty. Inside actual peer reviewed studies that attempt to draw deeper conclusions on the link between slower growth in countries with high income inequality, authors find that it is the political policy designed to redistribute wealth that is the cause of the slower growth, not income inequality itself. So it is in fact, the liberal policies attempting to address class envy that slows growth [1, 2]. And when controlling for intra-country differences with panel data, Barro finds that there is "little overall relation between income inequality and rates of growth and investment." Others have claimed that inequality leads to financial crisis. Subsequent studies debunked these claims. Others, including Stiglitz, claim that income mobility is restrained in unequal societies such as the US. But income mobility is high in the US [1, 2].

"The rich getting richer and the poor getting poorer" is a classic cliche where the unspoken assumption implies that the growing income of the rich somehow causes the poor to be poorer, even though they too are becoming richer, and the quality of life for those defined by the income threshold of poverty has also risen. The rising tide does lift all boats.

  • Why income inequality exists

What also causes income inequality that is not being talked about? The fact that income inequality is a reflection of the market. People have different talents, motivations, and abilities. As the the economy changes, an educated workforce with specialized skills is required and is leaving the uneducated behind. And then there are population dynamics that will increase the number of lower earning peoples, skewing the statistics. There are an influx of low earning immigrants, more college students than ever before, currently high unemployment for the past few years, a lot of part-time employees unable to find full employment whom are not included in the unemployment rate, and a large and growing number of retirees.

  • It is not a static number

Income is a moving target through each individual's different stages of life, so taking snapshots of income distribution really doesn't tell the story that the liberals are trying to narrate. One individual can be labeled poor, rich, and then poor again over time if using income as the gauge. But is a college kid working a part time job earning $10,000 a year really what we think of when we consider poverty? How about a retiree who owns his home and has a multimillion dollar investment portfolio but only sells off $25,000 a year to live off of? It is perfectly normal for adults at the peak of their careers to out earn college students and retirees, and it makes no sense to just pick a number and say anyone who earns less than that lives in poverty. Furthermore, for those usually at the focus of the income inequality debate, those at the million dollar income level, there is a lot of churn in the ranks and those making the list this year are not usually the same ones making the list next year. The rich are more exposed to financial markets, so when the economy does well, they do very well, but when the economy does poorly, they do much poorer than the other income classes.

  • Proposed solutionThanks to Veronique de Rugy

So how do those who see income inequality as a problem propose to solve the "problem?" Taxation: they want to take their income away from them. High income earners are a minority, so it is easy to discriminate against them and increase their taxes. The American public has been led to falsely believe through comments by Obama and Warren Buffet that the rich pay lower taxes than middle class Americans. Warren buffet says it would be a morale booster. Somehow your life is going to improve because more weight is added to someone else's back? The "tax the rich" supporters fail to mention that the US already has the most progressive tax system of all the OECD countries [1, 2, 3].

  • Tax justifications

They try to mask their class envy and try to justify their reasoning for raising taxes on high income earners in a multiple of ways. The most cited reasons are:
A) The rich need to pay their fair share.

  1. But they are currently paying the lions share.
  2. Taxes are progressive meaning that the more income one earns, the higher the rate one pays. What definition of 'fair' is being applied here?

B) They can afford to pay more

  1. By paying more taxes they end up being able to afford less.
  2. Who are you to say what they can afford just because you have a lower living standard?
  3. Why should they have to pick up the slack and divert money away from their own success to support the rest of America?
  4. I don't think they sought out to earn high incomes so that they could pay other people's taxes.
  5. They may be able to afford a herd of buffalo but should they be required to buy one?
  6. When you walk into a store does the price of the item change based on your income? No. So why should taxes?
  7. The whole point of becoming successful is to afford more consumption, not afford other people's taxes.

C) They have more to lose

  1. Which is why they pay more money to insurance companies on their extra property.
  2. They currently pay the most in taxes, so they are already paying extra.
  3. This very statement implies that all tax money goes towards national defense (only about 14% of it does).
  4. Our lives and liberties are what will be defended in the event of a country invasion or war, not property.

 

  • So what are my thoughts on income inequality?

Inequality is good. Our earth has a finite supply of resources and production. There has to be a system that distributes these goods according to one's means. Should you be able to live in Manhattan just because you want to, or because you bring something to the table and can afford to live there? You know what the opposite of inequality is? Communism. But with communism, since there are not enough resources to go around, everyone ends up with a substandard of living. Innovation is driven by the aspiration of reward. Wealth is a consequence of progress. Not everyone will or can be an innovator, and therefore not everyone will become wealthy. But should we stop this cycle of innovation just to spite those who do become wealthy? Do we have to blow out the brightest candles just so that they don't outshine the dimmest ones?

  • Something to consider

Here's a thought experiment. You could tax away all earnings above $100,000 a year and increase equality. But would doing this be a good idea? Do you think a business owner making $500,000 a year would bother to work the rest of the year after earning the $100,000 limit? In fact, he is likely to fire the percentage of employees that make up the other $400,000 in profits, so his job becomes easier since he wouldn't be allowed to be paid for the other profits that would accrue to the government. Of course, the newest highest rate just passed in the fiscal cliff deal will be about 43%, but the message and the result is the same. Why take away assets from those who earned them and are making the best use of them? Once commandeered, the resources are no longer being used to their full potential and instead are being wasted on some pet project by a government bureaucrat. Should Micheal Phelps be disallowed a swimmers cap just so that he doesn't blow away his competition as much? Should weights be added to his ankles to reduce the inequality of his performance? Progressiveness is anything but 'fair.'

  • The pie grows

When the media talks about how the 1% got more of the share of growth over the last several decades, they are missing the key point that they created this share. The economic pie grew because of their action. Without their efforts, it wouldn't even exist for anyone else to take. The populists see it through a lens that these high producers gobbled up all the income growth and took it away from someone else, but they are missing the point that they were the growth! It's not as if, if these producers didn't take action, that extra money would have appeared for everyone else. The pie grew because they built factories, buildings, inventions, companies, and the like. An economy doesn't just grow magically. And wealth isn't created out of thin air. It has to be created by someone with means and who makes an investment. The living standard we enjoy today is the highest it has ever been in the history of our planet and is a direct result of other people making even more money. You can thank them for your iPhones.


Comments   

 
+2 # Vale 2014-01-09 20:23
The Saint Louis fed made a write up on this previously and brought up the points of churn in the ranks, usage of 'household' versus individuals, and the value that high earners bring to society, among other points.
stlouisfed.org/.../?id=1920
 
 
-3 # Keith 2013-10-27 01:08
The problem is that the poorest Americans are having their liberty stripped because they lack enough money to have liberties in our brave new world that requires financial purchase of rights. 12 years of schooling is not enough. We need 16 years in our new society.
 
 
+2 # Vale 2013-11-16 12:06
What rights do they have to purchase? Everyone is entitled to 16 years. Everyone has access to federal student loans regardless of income.
 
 
+7 # Original Michael 2013-04-19 21:36
While the least productive in society OWN little of the wealth, this is a GOOD thing. The least productive have shown, via their own choices and actions, that entrusting them with capital is not beneficial to society. After-all, we gave them 12 years of free schooling, which they did not use to develop productive traits. Those who OWN the capital of this country, however, use it to produce a higher standard of living for everyone.
 
 
-6 # Keith 2013-05-15 22:13
Pure garbage. First of all, most high-paying jobs with professional licenses require schooling beyond those 12 years. Most licenses for jobs require at least a bachelors degree and others require a professional doctorate. The "schooling" society provided didn't allow them to develop productive traits. It forced them to write 5 paragraph essays, draw stupid posters, and recite Shakespeare when it should have been teaching them how to code and solder. Worthless parasites like you stunt their education for your own professional progress, so you owe most Americans monetary reparations for stunting their brain development in school.

You're a worthless parasite and no one would shed a tear if an angry mob crushed your head with a bolder.

"Those who OWN the capital of this country, however, use it to produce a higher standard of living for everyone."

This is debatable, but it doesn't appear to be true by most measures. Most people's living standards and quality of life haven't increased in 20 years. I'd rather have the life expectancy of 1990 if I also only had to pay the 1990 healthcare cost.

Obama's victory spells doom for your kind though. There's no more room for worthless parasites.
 
 
+2 # no to you 2013-06-04 19:55
"Most people's living standards and quality of life haven't increased in 20 years."

Really? All one has to do is look around: Car safety, medical advances, internet, cell phones just to name a few. Would you also take 1990's healthcare technology?

Obama's victory spells doom for our great nation. With the Obamanites demonizing success and wealth, we are already seeing innovator risk taking on the decline: online.wsj.com/.../...
The worthless parasites are the ones complaining that the rich are making too much, and then milking every last drop from the government teat. We know where you likely stand.
 
 
-8 # Keith 2013-06-08 20:00
"All one has to do is look around: Car safety, medical advances, internet, cell phones just to name a few. Would you also take 1990's healthcare technology?"

I'd take 1990's healthcare at 1990's prices without hesitation. Many wealthy elite are guild socialists who are forcing us by law to pay extra for healthcare scans and technology that doesn't help up. This is just one reason why the GOP deserves its fate.

Cell-phones have done little to improve our living standards. Car safety hasn't improved much either when one compares safety to the increases in cost. THERE HAVE BEEN NO SIGNIFICANT MEDICAL ADVANCES SINCE 1990 THAT JUSTIFY THE INCREASES IN COST. Overall, healthcare actually LOWERS our standard of living because there's a bipartisan effort to make it too expensive to purchase.

Most wealthy people(those with incomes greater than 1 million dollars per 5 years) become wealthy by depriving others of opportunities, by say, compelling the poor to purchase their services. An example is medical doctors who force patients to pay for scans to get medicine they need even when everybody already knows what's wrong. Another example is the California longshoremen who earn 200K per year by monopolizing and convincing their Congress to ban competition. A third example is Walmart, which thrives on using a peonage system of smuggled in labor as well as convincing Congress to unfairly tax superior stores such as Amazon and Best Buy.

In response to your comment, "The worthless parasites are the ones complaining that the rich are making too much, and then milking every last drop from the government teat. We know where you likely stand," I say that you don't understand how many of our nation's rich make their money. Many do it by criminalizing competition, getting big pensions from the government, and by stealing from others.

It's the rich who are milking the government teat, even in the "free"-market sector. They do this by getting special oligopolies, theft, and so forth.
 
 
+5 # Carl Spackler 2013-09-11 11:35
This may be the dumbest and most ignorant thing I have ever read. Wow, it's no wonder Obama got elected when they allow uneducated, economic illiterates like yourself to vote.
 
 
+4 # No to you 2013-09-12 09:05
I'm going to have to agree with Carl here. You clearly don't know anything about economics, healthcare, or technology. Nobody is being forced to purchase anything, except healthcare, from your beloved savior Obama. You remind me of the type of person who hasn't accomplished much in his life and the only way you can see someone becoming successful is if in your mind you establish it has having been some special privilege.
There really should be an exam requirement to vote. Something that shows some minimum level of intelligence and political knowledge.
 
 
-2 # Keith 2013-09-25 19:42
No no, there are many successful people who achieve success largely by the way of hard work. It's just that most are liberals now. Warren Buffet, Bill Gates, Steve Jobs, Elon Musk, etc are all liberals now. They're also quite philanthropic. There are a few successful libertarians and objectivists, the estranged cousins of the libertarian, like Jimmy Wales, but they're few and far between. In fact, the Republicans have only won a single state in the brains of America(Northea st and West Coast) since 1992 in a presidential race, and they've only won it once. Bush II won New Hampshire in 2000. Every other state in America's brains has voted Democrat in every election since 1992.

You see, the modern-day Conservative says he supports cutting welfare in the name of limited government, but then uses government regulations to force healthcare and education(profe ssional licensing fees) costs upwards. They also are trying to keep the bulk of the populace from being more productive. Texas' conservatives despise paying for the healthcare of the less-fortunate in the name of limited government, yet they oppose independent practice for nurse practitioners in the name of "necessary regulation." Liberals favor some regulation, but they sometimes believe in helping people comply with regulations. As long as conservatives keep favoring costly and unnecessary regulations to obtain high-paying jobs, they're guild socialists, keeping the masses down for the benefit of an elite few. Obama is right: law school should be only two years.

Furthermore, they say they value the Founding Fathers, but they ignore Alexander Hamilton's Report on Manufactures and decide to abandon Hamilton and Lincoln's legacy of industrial protectionism, costing America her once mighty industries.

If there were an exam requirement to vote, I'd be the one voting and you'd be disenfranchised . You should be grateful for the universal suffrage that my role models gave you.
 
 
+5 # Vale 2013-09-26 18:50
See there is the Gelman's paradox that is obfuscating your conclusion about Republicans in Northeastern states. The aggregate may vote Democrat, but all of the brains could be Republicans, for example. Maybe a majority of the innovators, who are rare by the definition of an innovator, are in fact Republicans. But you could never know from a two way vote split based on 30 million people when maybe a few thousand represent the "brains." I am not saying that is the case, but instead I am just pointing out that you cannot draw such conclusions from such broad data. If you go to a mental disability center and all the patients vote for a new 60 inch LCD, but you, managing the budget, vote against it, it doesn't really mean the best/smartest chose was made by the majority. Similarly it happens with views shaped by one aspect of a package deal of a political party.

Bill Gates is non-partisan actually. But really it doesn't mean much when you pick out a few select cases of billionaires at this point in time. Necessary questions would be what is the distribution? What was the distribution of these same people during their prime business struggle days? Did they always espouse liberal business policies in their businesses? And it is a good time to plug: youargue.com/.../...

Quote:
... but then uses government regulations to force healthcare and education(professional licensing fees) costs upwards.
I am pretty sure that it is the Republican platform to be against most government regulations. It is hard to pin healthcare regulation on Republicans when you can pin the tail squarely on the donkey (Pardon the pun) for Obamacare. I don't think that professional licensing and the fees associated with them is a partisan issue. And if a profession has a regulating body, the fees for registration are generally pretty minimal from what I have seen. However, licensing is generally done to make sure some Joe didn't just come off the street and is practicing law, for example.

Quote:
They also are trying to keep the bulk of the populace from being more productive.
I don't think this is the case. Productively increases profits, increases living standards, and increases self-reliance, which are all ideas espouses by Republicans.
Quote:
yet they oppose independent practice for nurse practitioners in the name of "necessary regulation."
Are there Texas Democrat groups taking the opposite position? Is there a demand for unqualified nurses (which I am assuming the regulation makes sure the NP has some minimum level of education)? Quote:
As long as conservatives keep favoring costly and unnecessary regulations to obtain high-paying jobs
Do you have any other examples of said regulations that only Republicans support that Democrats don't? Quote:
Obama is right: law school should be only two years.
I don't think this is a partisan issue, but is instead decided upon by the Legal bar and law firms for the minimum level of legal knowledge required.Quote:
...but they ignore Alexander Hamilton's Report on Manufactures and decide to abandon Hamilton and Lincoln's legacy of industrial protectionism, costing America her once mighty industries.
There is never a consensus among 56 people for starters, and just because some historical figure espoused it once, it doesn't mean that it is the right thing to do or economically correct. Quote:
If there were an exam requirement to vote, I'd be the one voting and you'd be disenfranchised.
"Republicans fare substantially better than Democrats on several questions in the survey, as is typically the case in surveys about political knowledge." people-press.org/.../...
 
 
-2 # Keith 2013-09-26 21:56
Quote:
See there is the Gelman's paradox that is obfuscating your conclusion about Republicans in Northeastern states. The aggregate may vote Democrat, but all of the brains could be Republicans...
Impressive reasoning, but unfortunately further research into the data suggests the Gelman Paradox doesn't apply here. Within the Northeast, the wealthiest neighborhoods are actually more likely to be liberal than the other neighborhoods. In MA., Cambridge, Lexington, Weston, Wellesley, etc are extremely liberal and that's where the most productive live.Quote:
Bill Gates is non-partisan actually. But really it doesn't mean much when you pick out a few select cases of billionaires at this point in time.
Have you heard Gates speak about wealth inequality? I just named a significant portion of the billionaires though. There are lots of other ones too like Ted Turner.Quote:
I don't think that professional licensing and the fees associated with them is a partisan issue. And if a profession has a regulating body, the fees for registration are generally pretty minimal from what I have seen.
No, because college and education costs are parts of licensing fees.Quote:
However, licensing is generally done to make sure some Joe didn't just come off the street and is practicing law, for example.
Then it's the average Joe who is paying such a high opportunity cost tax. Remember, once you legally require education as to engage in a type of commerce, the costs of the education become a tax, i.e., money the government forces you to spend.Quote:

Do you have any other examples of said regulations that only Republicans support that Democrats don't?
Tons! Shampoo licenses, bans against car companies selling directly to customers, historic bans on D.O.-trained medical doctors from practicing, absurd monopolies given to companies like Novartis with patents for drugs they never invented, defensive medicine, and artificially inflated education costs.Quote:
I don't think this is a partisan issue, but is instead decided upon by the Legal bar and law firms for the minimum level of legal knowledge required.
Who do you think votes to give the Legal Bar, or the AMA, authority? Also, it's becoming abundantly clear that the GOP was better when it had guys like Coolidge and Harding trying to keep America an industrial country.
 
 
+4 # Vale 2013-10-02 22:12
MA is the most liberal state in the nation so I am sure you would find more wealthy people who vote as Democrats in this state compared to others. gallup.com/.../...
However, you are still only looking at county based aggregates which throw the poor, the middle class and the rich into the same mix.
You bring up a good example with Cambridge. This is the part of Boston that houses many students that attend the various universities in the area. Students are usually overwhelmingly liberal since they don't yet pay taxes and have been indoctrinated by liberal teachers their whole lives. So even IF you had every single wealthy person voting for Republicans, and every college student (outnumbering them 100 to 1) voting for Democrats, the whole town would show up as Democrat.
Republican voters in each of those counties is rare, but not non-existent (around 10-30% for each), but so are high earners (the "productive brains"). You still haven't proved that the most productive are voting as Democrats, only that the county as a whole does.
But even IF you could, you still can't deny the fact that across America, on average, wealthier and therefore probably smarter, more useful, or innovating people vote as Republicans based on individual survey data. I'm sorry, but you can't change that fact. 2nd to last paragraph in: youargue.com/.../55int13oc2
Quote:
Have you heard Gates speak about wealth inequality?
Bill Gates may lean to the left, but he has contributed almost an equal amount to both parties over the years and he was clearly bothered by the government intervention of his company in the early 2000s. But still, I'd want to know if they were liberal their whole lives or became liberal long after they became filthy rich. And I would want to look deeper than the top 10. I have actually looked for data on this briefly and couldn't find a consistent list.Quote:
No, because college and education costs are parts of licensing fees
I'm not sure if I understand what you are arguing for. Are you saying that you want to get rid of all licensing bodies? You are okay with having unlicensed doctors, lawyers, etc...? To your other point, what about if they get their degree at some degree mill that is unaccredited?Quote:
Shampoo licenses, bans against car companies selling directly to customers...
But you haven't cited evidence that says that these are only issues that Republicans support and Democrats are against.Quote:
Who do you think votes to give the Legal Bar, or the AMA, authority?
Authority is given by employers who want to know that they are hiring quality people. A lawyer doesn't have to pass the BAR exam, but he's going to have trouble getting a job...
 
 
-5 # Keith 2013-10-03 00:32
Quote:
MA is the most liberal state in the nation so I am sure you would find more wealthy people who vote as Democrats in this state compared to others
You'd find the same trend nationwide.Quote:
However, you are still only looking at county based aggregates which throw the poor, the middle class and the rich into the same mix.
Dividing by neighborhoods is a reliable metric to adjust for this. Weston, MA. broke heavily for Obama. This isn't true just for Massachusetts either. In California, Silicon Valley broke heavily for Obama too. The odds of this being due to a huge discrepancy between class voting patterns within the same neighborhoods and towns are very slim given the demographic map.Quote:
But even IF you could, you still can't deny the fact that across America, on average, wealthier and therefore probably smarter, more useful, or innovating people vote as Republicans based on individual survey data.
I sure can. Only oil and mining barons are voting Republican, and they're not all necessarily productive. For instance, Fred Koch, after being victimized by crony capitalists in America who abused the patent system, made his first millions by helping Stalin kill and steal money from innocent Russians, Ukrainians, and others.Quote:
I'm not sure if I understand what you are arguing for. Are you saying that you want to get rid of all licensing bodies? You are okay with having unlicensed doctors, lawyers, etc...?
No, but if a government is to license those things, then free-market principles are not absolute. Furthermore, I staunchly believe that licenses should ONLY serve to protect a minimum standard of quality. They should not serve to manipulate the supply and create excessive barriers to entry, which is how they're being used.Quote:
To your other point, what about if they get their degree at some degree mill that is unaccredited?
There are far more efficient ways to assess minimal competency for most things than viewing academic credentials. Besides, by your principles, shouldn't the market decide and shouldn't people have liberty?Quote:
But you haven't cited evidence that says that these are only issues that Republicans support and Democrats are against.
Tea-Party controlled Texas has shampoo licenses and bans on direct-to-customer car sales, and Liberal Massachusetts does not. That's enough evidence.
Quote:
A lawyer doesn't have to pass the BAR exam, but he's going to have trouble getting a job...
This is just a complete lie. A lawyer always has to pass the BAR, and he now has to go to Law School or, in a couple of states, complete the more costly Law Office Study Program.
 
 
-4 # Keith 2013-10-03 05:29
Anyways, the surveys consistently show that most innovators vote Democrat. At MIT, your entire student body is pretty much the cream of the crop. There are brilliant people who go to no-name schools, but let's use MIT as an example because the entire campus is top notch. Roughly 80% of MIT broke Democrat. Now that the Tea Party didn't defend Aaron Swartz, but Sen. Warren did, the number is probably even higher.
90% of Scientists vote Democrat and the Republicans nominated Arthur Robinson, who claims that a living foods diet of wheatgrass reduces the severity of cancerous tumors by an average of 75%, for Congress. Who knows what Robinson meant by this vague quantitative claim that speaks of quantified severity?
 
 
-6 # Keith 2013-10-05 14:16
[Admin note: Name changed back to Keith due to the same IP Address. Please no Astroturfing]
I concur. What we're seeing is the GOP abandoning its principles and advocating Mudsill Theory by restricting the supply of high paying jobs.
That's why they're making education requirements of licensing excessive, while simultaneously jacking the price up to make it tough to pay. We should look at the GOP's war on Nurse Practitioners and well as their war on prison reform. When Obama wanted to stop subsidizing colleges that weren't lowering tuition rate, bailout Kingn Lamar Alexander blocked the legislation. This cements my view of the current Republican Party as a party that's much worse than the Democratic Party because the Democrats at least mean well.
 
 
+5 # Vale 2013-10-06 01:45
Quote:
they're making education requirements of licensing excessive, while simultaneously jacking the price up to make it tough to pay.
Republicans aren't jacking the prices up. Your liberal educators are jacking the prices up. But this is a reflection of supply and demand. When almost every kid is looking for a seat in college and there are only so many to go around, the price can only go up. Throw more money at it with federal funding and student loans like the Democrats want to do, and the price can only go up, at the taxpayers expense.
They sell you on the image of meaning well, but do you really think any bureaucrat from any political party really cares about YOU?
You lose credibility with the "War On..." rhetoric.
 
 
-5 # Keith 2013-10-06 09:57
[Admin note: Name changed back to Keith due to the same IP Address. Please no Astroturfing]
The Republicans are fixing the supply to jack up the price, probably because the Paul Ryan types enjoy abusing workers without a lot of education.
 
 
+3 # Vale 2013-10-06 01:41
Quote:
Anyways, the surveys consistently show that most innovators vote Democrat.
Does 80% of MIT go on to found the next Facebook? Innovators are rare, my friend. Eighty (roughly) percent of every college student body is liberal - it's not really particular to MIT. Liberalism is associated with young, unwise and inexperienced voters. I'm not saying they are stupid, but only with time can they see how the world really works and get exposure to ideals that differ from the liberal indoctrination. Conservative professors are discriminated against so opposing viewpoints are not really incorporated into the discussion. washingtontimes.com/.../... I too was a liberal during college and fought as hardily against some of the things I now argue for. Libertarianism has to be learned on one's own for the most part because it doesn't fit in with the package deals of the two parties.
I'd like to see the survey of that 80% of MIT 10 years after graduation. I would bet large that a lot of those political views would shift, just as it did for me, given that by just slicing voting preferences on age alone, we do in fact see as one gets older, they start moving away from liberalism.
 
 
-5 # Keith 2013-10-06 11:06
Quote:
Does 80% of MIT go on to found the next Facebook? Innovators are rare, my friend.
No, I imagine 80% of its students have too much honor to plagiarize and steal. The real inventors of Facebook, the Winklevoss twins, are liberals. Plus, Zuckerberg is forcing public school students to learn fake programming languages like Scratch(see Code.org) instead of real programming skills because he wants to restrict computer science knowledge along with the rest of the GOP. Notice how Bush refused to introduce computer science classes into the elementary school curricula of every state to favor children who had access to computer science classes outside of school. If the GOP wants votes they should consider advocating that states have mandatory computer science classes in order to graduate high school.
 
 
+4 # Vale 2013-10-06 12:15
I believe Zuck is a liberal too. But anyway, it is besides the point. You should look a little deeper into the code.org mission and who else supports the project. I think you have it backwards in that they want to get more young people interested in programming.
What students taking computer science classes outside of school?
Please cite the bill where Bush actively vetoed putting computer science classes into the high school curricula. By your thought process, Obama has refused to put CS classes into every state curriculum as well. And every other president before either.
 
 
+7 # Vale 2013-10-06 01:19
Quote:
Silicon Valley broke heavily for Obama too.
You singled out a particular industry that happens to be liberal. I could pick out the energy industry as an example of a conservative industry. Can the world live without Facebook? Yes. Could it live without movies? Yes. Can it live without energy? No. Defense industry? Maybe, if we had the non-existent world peace. Finance industry? No.Quote:
Furthermore, I staunchly believe that licenses should ONLY serve to protect a minimum standard of quality.
How do you know that the licensing requirements aren't currently only protecting a 'minimum standard?' Who decides what the minimum is? See the problem I see with your point is that damn near anyone who has a certain level of ability can become whatever they want to regardless of licensing. There has never been a crisis of people in this country who have gone all the way through college only to be blocked at the last minute by a licensing exam. How's that licensing requirement doing keeping the supply of lawyers down? slate.com/.../... Not a very good job, if that is what its only sole purpose is.
I'm not saying that there should or shouldn't be licensing, but I suppose it is more comforting to know that my doctor is licensed to practice medicine. But you still haven't shown that only conservatives support licenses and liberals don't. Teachers licenses for instance?
I still think you are ignoring the biggest type of organization that exists solely to drive up the wages of its members by restricting supply. Unions - the Democratic base. Just like a licensing requirement, but there is no exam guaranteeing competency. One cannot be fired for mistakes. Whether you get work is only determined by how long you have been paying dues. You can be a dues paying member without any work until all the other senior members are getting theirs or you make friends with the union bosses daughter, all regardless of how much of a better worker you might be! This is a worse situation than occupational licenses. What happens when states switch to right-to-work states? Employment goes up. cascadepolicy.org/.../...Quote:
Texas has shampoo licenses and bans on direct-to-customer car sales, and Liberal Massachusetts does not. That's enough evidence.
That's not very rigorous. You know that New Hampshire, a liberal state has the same license, right? And every state has silly licenses regardless of red or blue. Cutting hair in California requires a year of study and Connecticut is the only state in the country that requires a license for glass installers, for example. And I guess you didn't know that 47 other states aside from Texas limit the direct-to-consumer car sales, huh? articles.chicagotribune.com/.. ./... Yeah. Quote:
This is just a complete lie. A lawyer always has to pass the BAR...
Oh, really? americanbar.org/.../...
 
 
-4 # Keith 2013-10-06 13:54
Quote:
You singled out a particular industry that happens to be liberal. I could pick out the energy industry as an example of a conservative industry.
Yes, people who work hard and think to solve problems tend to be voting Democrat these days. People who stick polls in the ground and hope black stuff shoots out, relying on government monopolies from other countries and the blood of Americans better than either of us, tend to be on the War-Hawk wings of both major parties. Now, this is not always true. There are those like David Gelernter and Jimmy Wales who are great innovators and Republican, but there are also energy magnates who are liberal, but the tendency still persists.Quote:
How do you know that the licensing requirements aren't currently only protecting a 'minimum standard?' Who decides what the minimum is?
The fact that many of our top physicians have attended medical schools abroad strongly suggests that the AMA has been restricting the supply of medical schools for reasons other than quality. Furthermore, we have a lot of documentation that suggests the AMA intentionally restricted the supply of primary care physicians. Reuben Kessel, writing in Duke Law Review, explains the issue in great detail. Read "The AMA and the Supply of Physicians." Plus, just go on the forums at studentdoctor.com to see what a lot of doctors and residents think: most want competition to be restricted to guarantee high pays at the expense of the patient.Quote:
See the problem I see with your point is that damn near anyone who has a certain level of ability can become whatever they want to regardless of licensing. There has never been a crisis of people in this country who have gone all the way through college only to be blocked at the last minute by a licensing exam.
Why should they have to pay for a college degree anyways? Norman Fenton was an incredibly good medical physicist. He was banned from the industry because he didn't have a college degree though. The Tea Party supported the degree requirements even though Fenton's performance had been excellent. While the Democrats support these requirements, at least they support making it easier to satisfy these requirements. The Republicans support these requirements, but they don't even pretend to want to help people meet them.
If college degrees weren't barriers to entry, there'd be a lot of people passing licensing exams without formal degrees for a lot of professions.
 
 
+4 # Vale 2013-10-06 21:18
Quote:
Yes, people who work hard and think to solve problems tend to be voting Democrat these days.
You still haven't shown this. And I would think that drilling oil would be hard physical labor. How about the engineers that have to come up with solutions to obtain it?
Quote:
The fact that many of our top physicians have attended medical schools abroad
Then the AMA isn't restricting supply if outside medical schools are accepted, right?Quote:
Why should they have to pay for a college degree anyways?
Someone has to pay for it, why shouldn't it be the one who will reap the future benefits of it? Quote:
Norman Fenton was an incredibly good medical physicist. He was banned from the industry because he didn't have a college degree though.
Going to prison for fraud and perjury probably didn't help his future career prospects in the medical industry. Also, he didn't even graduate from college as required by federal law and lied to get his certification (tells you how much those certification bodies are restricting supply, doesn't it?)! I don't know about you, but I would prefer my radiologists to have proof that they have some minimum level of knowledge about the machines they are supposed to be maintaining. I know that is a crazy idea. Quote:
The Tea Party supported the degree requirements even though Fenton's performance had been excellent.
Care to share that press release where the Tea Party gave support for degree requirements? I'm still waiting on the proof that Bush vetoed a bill that prevented computer science classes in high schools.
Quote:
While the Democrats support these requirements, at least they support making it easier to satisfy these requirements.
I'll take a press release on this one too.
Quote:
If college degrees weren't barriers to entry, there'd be a lot of people passing licensing exams without formal degrees for a lot of professions.
I wouldn't be so sure about that. Degree requirements make sure that you have some knowledge about the industry you are supposed to be working in. A licensing exam is going to test you on that knowledge. California for instance does not require a law degree to take that Bar exam. You think it is a coincidence that it has the lowest bar passage rate in the nation? Or is it those crazy conservatives liberals restricting the supply again?
www.statisticbrain.com/.../
Second lowest passage rate D.C, also a liberal bastion. The next state is 20 points higher.
 
 
-3 # Keith 2013-11-16 12:47
Quote:
You still haven't shown this. And I would think that drilling oil would be hard physical labor.
It is, but it's no harder than working as a cashier for 12 hours. It's just a matter of living near oil. Also, the petroleum engineers don't do the physical labor and neither do the investors. Often, as in the case of Fred Koch, the billionaire oil men have used slave labor. Koch himself alludes to this in his book about his time as Stalin's ally.Quote:
How about the engineers that have to come up with solutions to obtain it?
It's just a subset of civil and mechanical engineering, nothing special. Quote:
Then the AMA isn't restricting supply if outside medical schools are accepted, right?
Only a small handful of outside schools are approved, regardless of test-score performance btw, and only when there are residencies available. The AMA restricts the supply of residencies to create a perpetual physician shortage, at the expense of the American patients.Quote:

Someone has to pay for it, why shouldn't it be the one who will reap the future benefits of it?
Because it gets passed on to the customer, which makes it tougher to buy essential services. If the Republicans oppose helping people buy healthcare, then it's downright evil for them to support price floors on the cost of healthcare so that an unnecessarily large portion of the population has to die before age 70.Quote:
Also, he didn't even graduate from college as required by federal law and lied to get his certification (tells you how much those certification bodies are restricting supply, doesn't it?)!
In this case, the federal law required a college degree.Quote:
I don't know about you, but I would prefer my radiologists to have proof that they have some minimum level of knowledge about the machines they are supposed to be maintaining. I know that is a crazy idea.
It's equally crazy to think that the government should occasionally try to intervene to improve upward mobility and people's living standards. Do you think the government should decide qualifications for you? Why can't you decide who's qualified to perform your own heart surgery? If we are going to require minimal qualification standards with pieces of paper, then the people pursuing such qualifications, and the public who ultimately has to pay for their services, deserve compensation. It was a pro-Tea Party prosecutor, John L. Brownlee, who supported the degree requirement. Once you impose costly regulations, you should make some type of compensation.
 
 
+2 # Vale 2013-11-16 13:58
No, I still think that drilling for oil would still be harder than being a cashier. Also, your typical (fast food) cashier only works part-time. Quote:
petroleum engineers don't do the physical labor
Oh, so you are admitting that there is a little more than just "sticking poles in the ground and hoping oil shoots out?" Quote:
The AMA restricts the supply of residencies
A medical residency is kind of like another post graduate training program. According to some responses from senior physicians addressing this issue on the AMA website, apparently it has a lot to do with medical students picking the wrong residency program: ama-assn.org/.../... Do we lower the standard of what it takes to be a doctor in this country for the sake of cheaper costs? Maybe. But I am sure that has other costs. Quote:
Because it gets passed on to the customer
So instead, you would like the taxpayer to pay the cost. Great plan. Quote:
then it's downright evil for them to support price floors on the cost of healthcare so that an unnecessarily large portion of the population has to die before age 70.
What price floors? And no, that's the ObamaCare plan, where a committee determines if you are eligible to get treatment or not. Quote:
In this case, the federal law required a college degree.
Which he also didn't have. Quote:
It's equally crazy to think that the government should occasionally try to intervene to improve upward mobility and people's living standards.
I agree, that is why I am against welfare/food stamp handouts and subsidies for most of the people who receive them. Quote:
Why can't you decide who's qualified to perform your own heart surgery?
Do you really think the general public is able to do that? If you don't have a medical degree, how are you going to know if one doctor is better than the other? Yelp reviews? "I didn't die on my heart surgery, A+" Or what if it's an emergency and you aren't given a menu of physicians while you are laying there in cardiac arrest? You still need to give it more thought.
 
 
# Sammy 2014-03-20 09:22
If "Hummer" were to have sold direct, every Progressive Greenie in the country would be screaming "UNFAIR!!" while pointing to the law...
 
 
-3 # mitch52 2013-04-03 12:02
Not so upset about wealth inequality, more upset about power inequality which comes form money. The argument here that groups band together to form PACs being the same as the Koch Brothers lobbying for what they want is ridiculous. Jon Corzine walking around free is ridiculous. Not one Wall Street or Mortgage player big wig in jail for the sins of the last meltdown is ridiculous. Power corrupts and big money buys the power.
 
 
+13 # Vale 2013-04-03 17:54
I think the 2008 crisis was more about ignorance (what are really the value of these CDOs?) and skewed government incentives (sub-prime? The government will guarantee! Load up, the CRA says it is your duty!) than actual fraud. Financial crises have always happened and will always happen in the future - it's just part of the economic cycle.
The MF Global case does sound like a case of fraud, or at the very least of mishandling client capital, so it does appear that Corzine got off scot-free. He is a very powerful man and probably wasn't charged because of his political clout, but that is a problem with favoritism in our political system, not a factor of him being wealthy. Martha Stewart had a billion dollars and the best attorneys but couldn't get out of insider trading charges and prison time for selling 50k of stock a day early. Whose case would you consider more harmful to society?
Overall though, wouldn't a more direct route be to outlaw PACs to address the money-buys-powe r situation?
 
 
-12 # known 2013-03-06 01:37
Buffett's secretary Bosanek pays a tax rate of 35.8 percent of income, while Buffett pays a rate at 17.4 percent.
 
 
+18 # DrDean 2013-04-03 02:16
At 35.8% I'd guess Bosanek probably grosses between $300K and $500K per year. Did she file jointly, separately? Is she married? Does she have interest or dividend income?

Bosanek's tax rate may be a function of her spouse's salary or other factors conspicuously not provided by Buffet.

Buffet's income is non-salary and taxed at the same rate as anyone else who makes income through investments - which is a *lot* of Americans.

Cap gains tax rates are where they are for good reason as the money invested is at risk of loss and lower rates provide incentive to accept the risk of investing for the good of businesses, institutions and government functions that use the invested money.

Obviously the same risk/reward scenario and related incentives does not exist with salaried or hourly-wage income.

Comparing Buffet's tax rate with his secretary's is a cheap parlor trick by slick politicos counting on the ignorance of those the want to influence with their disinformation.
 
 
+9 # Vale 2013-04-04 09:05
Extremely well said. I'd like to add in addition to risk and incentive for investment:
- Inflation
- Increases liquidity of capital
More is discussed on my article here:
www.youargue.com/.../30tax
 
 
-3 # Keith 2013-11-13 22:04
1) Why are you complementing your own article in the comments section?

2) Can you even read The Constitution?

The 5th Amendment clearly states that the government should protect "Life, Liberty, and Property."

This country has been steadily declining since 1980 and its because of you illiterate, uneducated, and treacherous Reaganites trying to sabotage the American Mission with fascism.
 
 
+1 # Vale 2013-11-16 14:07
1) I thought it was obvious: saying his response was good, and added a link to some other points that he didn't address.
2) Yes, but apparently you can't because it says "nor be deprived of life, liberty, or property, without due process of law" meaning the government can't take your life, liberty or property at will.
Whoa, someone call the hostility police! We have an angry ObamaBot on the loose who needs some education in Economics. Talk about uneducated!
 

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