Topic: General

The Progressive Income Tax Enriches the Envious and Greedy

Most Americans dislike the income tax, now more than a century old. The rates are too high. The provisions are unfair. The record-keeping is onerous. The revenues are wasted.

But there are fans, certainly, such as the politicians of both parties. What good would it do to serve in Congress if you didn’t have money to spend? 

The beneficiaries of the politicians’ largesse also share in the income tax lovefest. Uncle Sam needs money to write checks. He can borrow, but there’s a limit to the credulity of investors. Borrow too much and they might doubt Washington’s ability to repay. 

Then there are the fans of expensive and expansive government. Never mind the endless mess created by Uncle Sam. Something he does must work!

More dangerous may be the social engineers. For instance, Yale economic professor Robert J. Shiller suggested using the income tax to mitigate “some of the worst consequences of income inequality.” He proposed indexing taxes to income inequality.

It’s a genuinely nutty idea. Inequality measures are sensitive to data distortion. Moreover, they incorporate no moral judgment as to how the inequality arose. Were opportunities obstructed and systems manipulated, or did a generally free society operate naturally and deliver ever-changing income and wealth patterns? 

Chamber of Commerce and Business Roundtable: Borg Enablers

Remember the Borg? You know, the Star Trek cyborgs who would encounter a ship, tell its occupants “resistance is futile,” then turn them all into Borg? Of course the Enterprise always resisted, and always survived. But what if Captain Picard had instead ordered, “Surrender. Then they’ll leave us alone.”

The crew response to that would certainly have been, “ol’ Jean-Luc is losing it!” At least, it would have been for the few seconds before everyone was converted into mindless drones. Yet that is just the sort of order a group calling itself the “Higher State Standards Partnership” is trying to issue to conservatives and libertarians when it comes to the Common Core. Yesterday, the Partnership – a front for the U.S. Chamber of Commerce and Business Roundtable – wrote in the Daily Caller that opponents of the Core should stop resisting if they want to keep schools from being assimilated by the federal government.

You read that right: After blaming the Obama administration for using the Race to the Top to meddle “in a clearly state-led, locally controlled education initiative,” the Partnership counseled Core opponents to end their resistance. Defeating the Core, they wrote, “would only bolster the hand of the Administration and invite federal control into our schools.”

The Whistleblower Versus Robert Mugabe and the United Nations

Zimbabwe’s Robert Mugabe is a corrupt authoritarian.  The United Nations is a wasteful, inefficient organization that tolerates corrupt authoritarians.  Unfortunately, the two don’t make beautiful music together.

Not everyone at the UN is corrupt.  One hero is Georges Tadonki, a Cameroonian who for a time headed the UN Office for the Coordination of Humanitarian Affairs (OCHA) in Zimbabwe.  The others are three judges in a United Nations Dispute Tribunal who last year ruled for Tadonki in a suit against the international organization.

Soon we will find if members of a UN appeals panel possess equal courage.  That ruling is expected soon with rumors circulating that these judges might reverse course and absolve the organization of misconduct.

In 2008 President Robert Mugabe, who took power in 1980, and ZANU-PF, the ruling party, used violent intimidation to preserve their control.  At the time Tadonki had been on station for six years and predicted epidemics of both cholera and violence. 

Unfortunately, UN country chief Agostinho Zacarias dismissed Tadonki’s warnings.  By the end of the year 100,000 people had been infected with cholera and thousands had died.  During the election campaigns hundreds also had been killed by government thugs, who succeeded in derailing democracy. 

Naturally, no good deed went unpunished.  After extended discord between the two UN officials, Tadonki was fired in January 2009.  There was little doubt that the action was retaliation for being right and embarrassing Zacarias—who now serves the UN in South Africa. 

The controversy demonstrates that something is very wrong with the UN system.  Tadonki decided to fight, though he had to ask the international law firm Amsterdam & Peroff to handle the litigation on a pro bono basis.  Last year the UN Dispute Tribunal based in Kenya heard his case and Judges Vinod Boolell, Nkemdilim Izuako, and Goolam Merran issued their 104-page judgment. 

They concluded “that the Applicant was not, at all material times, treated fairly and in accordance with due process, equity and the core values of the Charter of the Organization” and that OCHA management ignored the UN’s “humanitarian values.”  The tribunal ordered the UN to apologize for its misbehavior, investigate the mistreatment of Tadonki, hold his superiors accountable for their misconduct, cover Tadonki’s litigation costs, pay past salary through the judgment date, and provide $50,000 in “moral damages for the extreme emotional distress and physical harm suffered by the Applicant.”

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Russians And Ukrainians Battle Over Crimea: The Tragic Perils of Nationalism

No good end to the Crimean crisis is likely.  Moscow seized territory historically part of Russia and won’t retreat.  Ukraine won’t accept Moscow’s land grab. 

The West can’t ignore flagrant aggression and is headed toward a “cool war” with Russia.  Crimeans unwilling to shift allegiance will have to leave their homes.  Such are the perils of nationalism, which remains sadly popular today.

Russia has officially absorbed Crimea.  The veneer of legality doesn’t disguise Moscow’s act of war.  A majority of the territory’s people may have wanted to leave, but a referendum framed by Russian advocates and conducted under Russian military occupation was certain to yield the result desired by Vladimir Putin, not Crimea’s citizens. 

Kiev is no more interested in the desires of Crimea’s people.  The West proclaimed itself shocked at Moscow’s move, even though the former routinely intervenes militarily for its own ends. 

While the Russian government deserves to be punished for its bad behavior, there is no chance it will reverse course.  The U.S. and Europeans are heading toward extended confrontation with Russia. 

The biggest losers are Crimeans who prefer Ukraine’s inefficient and corrupt, but still functioning—at least until the violent overthrow of the elected government—democracy to Putin’s wealthier but increasingly authoritarian wannabe empire.  Even some ethnic Russians might have preferred to deal with Moscow from afar. 

There is no right answer to the controversy.  Ukraine only had formal legal title to Crimea because in 1954 Soviet Communist Party General Secretary Nikita Khrushchev, who ran Ukraine before ascending to the summit of power in Moscow, transferred control of the territory from Russia to Ukraine.  At the time, no one imagined the Soviet Union dissolving.

But in 1992 Ukraine fled the collapsing Communist superstate with Crimea in tow.  Last month violent street protests shifted control in Kiev from Russophiles in eastern Ukraine to nationalists in western Ukraine. 

That angered the former and sparked a violent response from the Kremlin.  Putin’s conduct, though deplorable, was understandable.  As Henry Kissinger once said, even paranoids have enemies.

As I pointed out in my new column on Forbes online:

Since the end of the Cold War the West has pursued its version of the notorious Brezhnev Doctrine:  What’s mine is mine and what’s yours is negotiable.  The U.S. and Europe advanced NATO to Russia’s borders, poured money into Ukraine to promote pro-Western candidates, pressed Kiev to choose between Russia and the European Union, and pushed friendly politicians toward power after the ejection of Russia-friendly Yanukovich.

Yet none of this would have mattered if the majority of Crimeans had clearly wanted to switch allegiance and Putin had waited for them to act.  In general, people should be able to freely decide their political destinies.

The Wall Street Journal on Halbig v. Sebelius

Today, the U.S. Court of Appeals for the D.C. Circuit will hear oral arguments in Halbig v. Sebelius, one of four cases that Jonathan Adler and I helped spur with our 2013 Health Matrix article, “Taxation Without Representation: The Illegal IRS Rule to Expand Tax Credits Under the PPACA.” Critics call Halbig the most significant existential threat to the Affordable Care Act.” In anticipation of the hearing, the Wall Street Journal wrote a lengthy editorial explaining the issues. Excerpts:

Halbig v. Sebelius involves no great questions of constitutional interpretation. The plaintiffs are merely asking the judges to tell the Administration to faithfully execute the plain language of the statute that Congress passed and President Obama signed.

The Affordable Care Act—at least the version that passed in 2010—instructed the states to establish insurance exchanges, and if they didn’t the Health and Human Services Department was authorized to build federal exchanges. The law says that subsidies will be available only to people who enroll “through an Exchange established by the State.” The question in Halbig is whether these taxpayer subsidies can be distributed through the federal exchanges, as the Administration insists…

In 2012, HHS and the Internal Revenue Service arrogated to themselves the power to rewrite the law and published a regulation simply decreeing that subsidies would be available through the federal exchanges too. The IRS devoted only a single paragraph to its deviation from the statute, even though the “established by a State” language appears nine times in the law’s text. The rule claims that an exchange established on behalf of a state is a “federally established state-established exchange,” as if HHS is the 51st state.

Careful spadework into ObamaCare’s legislative history by Case Western Reserve law professor Jonathan Adler and Michael Cannon of the Cato Institute has demonstrated that this jackalope rule-making was contrary to Congress’s intent…

Mr. Obama has conceded that “obviously we didn’t do a good enough job in terms of how we crafted the law.” The right and only lawful way to repair ObamaCare is through another act of Congress. In Halbig, the judiciary can remind the Obama Administration of this basic constitutional truth.

Jonathan Adler critiques the Halbig district court’s ruling in favor of the IRS here.

Find lots of commentary by me on the Halbig cases at DarwinsFool.com.

This reference guide contains all the information you could want about these cases – and more.