Archives: 12/2007

Stranger in a Strange Land

A few days ago, I was quoted in an AP story as saying that scientists as scientists are in no position to dictate federal policy to address global warming. A rather predictable outcry followed, prompting my defense here.

Amazingly enough, that somewhat provocatively titled post did not soothe the savage environmental beasts. Michael Tobis, a climate scientist at the University of Texas Institute for Geophysics, posted a rather angry shot over at Grist (the preeminent gathering place for environmentalists on the web) arguing that economists and economic analysis have absolutely nothing to add to the policy conversation about global warming. An editor over at Grist kindly invited me to respond, so I Fisked the man and responded to the commentary about two-thirds of the way down the page in a post titled “Taylor Defends Taylor.”

What exactly informs this “economists are a plague upon mankind” view of the environmental Left? My guess is that it is a combination of things. First, environmentalists deeply resent the fact that anyone would presume to put a price tag on things they value. Second, many environmentalists do not understand economics very well and thus fall for all sorts of cartoonish depictions about what economists do and what they think. Third, economic analysis does not support many environmental fantasies about the future of humankind under either the “business as usual” scenario or under the environmentalists’ vision of the Book of (Environmental) Revelation.

Of course, speaking of “economists” generically — as if all economists are alike — is as dubious as speaking of “environmentalists” generically. If the environmental Left really wants an informed criticism of economics, they would do well to pick up Robert Nelson’s Economics As Religion: From Samuelson to Chicago and Beyond.

Cult Kidney Donations

Today’s Wall Street Journal has an article on live kidney donation as a form of charity. Half the members of a Christian sect have gone through the surgical operation of donating a kidney to a stranger. The article questions whether pressure from “cult” members creates undue influence. Social and government pressure to donate both at death and while living is mounting. See Cato’s recent Policy Analysis “A Gift of Life Deserves Compensation.”

Huckabee Hearts Teachers Unions & Government Education

In case anyone required more proof that Mike Huckabee is, to put it in the oxymoronic and twisted terms common parlance seems to require today, a social-conservative liberal, just watch this video of Huckabee pandering speaking earnestly to the NEA.  No wonder the New Hampshire chapter of the NEA endorsed him.

At the Univision debate, Huckabee proposed that “the federal government launch ‘weapons of mass instruction,’ including enhanced art and music to help motivate students and stimulate their creativity.” 

Right … the problem with K-12 government education is that the kids who can’t read or add don’t have enough time with finger paints and cymbals. I guess we know how he’d like to update No Child Left Behind, which he called “the greatest education reform effort by the federal government in my lifetime.” 

Huckabee supports government school choice, but opposes efforts to expand educational freedom and reduce the massive tax-funded financial discrimination against independent and homeschooling. 

He claims to be a friend of homeschooling, and indeed supports protection against government intrusion.  But what about tax discrimination against homeschoolers?  How can he expect private forms of schooling to thrive when he worked to massively increase taxes and give much of that money to government schools, and supports more of the same at the federal level?

Huckabee’s education policies are incompatible with expanding freedom in education. And where he does support existing freedoms, his position conflicts with his general preference for state coercion over individual freedom and civil society.

End the Shoe Tax!

In a post yesterday, my Cato colleague Chris Edwards graphically demonstrated that the U.S. tax code is very “progressive,” imposing far higher effective rates on high-income households than on lower-income households. But one area of federal taxation—the U.S. import tariff code—is actually quite regressive.

Even after decades of trade liberalization, some of the highest remaining U.S. tariffs are imposed on imported goods that loom largest in the budgets of low-income families—namely the staple items of food, clothing, and shoes. And the highest tariffs within the categories of shoes and clothing are imposed on the lower-priced varieties that poor families would be most likely to buy.

That is all the more reason to feel good about a movement under way to “end the shoe tax.” According to a story in today’s Chicago Tribune:

Footwear manufacturers and retailers are trying to end a Depression-era federal shoe tax, a move they say could save American consumers hundreds of millions of dollars annually and kick-start relatively flat footwear sales.

Trade associations and their members, such as Payless ShoeSource, Nike Inc. and Columbia Sportswear Co., have been lobbying U.S. lawmakers weekly since the summer to get them to exempt certain categories of footwear, including all children’s shoes, from the import tariffs that can run as high as 67.5 percent a pair.

The groups created a Web site, EndtheShoeTax.org, to raise awareness and encourage constituents to tell their lawmakers to pass the Affordable Footwear Act of 2007.

Repealing the shoe tax would have minimal impact on employment. According to the story, 99 percent of shoes sold in the United States are imported. Americans stopped making low-end shoes years ago. And even if jobs were at stake, it would not justify a cruel tax on such a basic necessity. (The same logic applies to remaining tariffs on t-shirts, as I explained in a recent op-ed.)

The political irony here is that many of the same people who complain the loudest that the rich are not paying their “fair share” of income taxes are the first to oppose any lowering of regressive trade barriers that make it more difficult for poor parents to feed and clothe their children.

I Hope You Like Asparagus

Further to Dan’s post today, some more depressing news today on the farm bill process. A couple of amendments that would have trimmed some excess fat also failed.

Sen. Judd Gregg (R., N.H) has proposed a number of amendments to the farm bill. The two that failed today were designed to strike a couple of almost comic provisions of the farm bill that emerged from the Senate Agriculture Committee. The first, to strike language that establishes a “Farm and Ranch Stress Assistance Network,” a mental health program for farmers, failed 37-58. The other, to strike a new program to provide subsidies for asparagus producers, failed 39-56. (Roll call records are not yet available)

Now, I am willing to concede that farming might be stressful at times (although Mencken would disagree). I certainly wouldn’t like getting out of bed at dawn to milk cows. And I am sure it is a tough business, rearing asparagus. But I once saw a stockbroker outside the NYSE smoking two cigarettes at once, and looking decidedly harried. And I bet he earned less than some farmers. Where’s his taxpayer-funded “stress assistance network?”

This is a further sign of the truly staggering resistance to reform U.S. agricultural policy. Tom Harkin (D., IA), Chairman of the Senate Agriculture Committee, said that the proposed reforms of the Lugar-Lautenberg amendment were “too far too fast.”

Too fast? These programs have been with us for over 70 years, Senator.

CBO’s Orszag on Waste in Medicine

In today’s Wall Street Journal, Congressional Budget Office Director Peter Orszag writes [$]:

Some academic research suggests that national costs for health care can be reduced by perhaps 30% without harming quality.

In the September 2007 issue of Cato Unbound, Robin Hanson sees Orszag’s 30 percent and raises him another 20 percent.

Who Pays

The Congressional Budget Office released new data yesterday on the burden of federal taxes. The data answers the question: What share of earnings do households at different income levels pay in federal taxes?

The CBO data is useful because it not only includes individual income taxes, but also corporate income taxes, payroll taxes, and excise taxes. Those four taxes account for virtually all federal revenues. The data is for 2005 and is based on a definition of “income” that is broader than AGI reported on income tax returns.

The chart shows that households with higher incomes pay a much larger share of their income in federal taxes, on average, than do households with middle and lower incomes. Clearly, there are gross inequities in federal taxation. But few people will find out because none of the major newspapers reported on the CBO data, as far as I could tell.