The Latest from the Children’s Defense Fund

Or maybe a small child, judging by CDF’s fairly shameless pro-SCHIP campaign.

Turns out there is a solid case to be made that expanding SCHIP and Medicaid would leave us with more dead kids.  Of course, the ideological left won’t engage that debate. 

They’d rather just accuse their opponents of killing kittens.

Strategic Myopia, the Ongoing Saga

While the Bush administration has been busy fighting terrorism by spending half a trillion dollars and 3,400 American lives loosing and then trying to keep apart the various confessional, tribal, and ethnic factions in Iraq, the New York Times brings us grim news about a struggle that may have more direct relevance to protecting ourselves against the most pressing threat we’re likely to face in the coming years. Here are the first two paragraphs from the piece:

WASHINGTON, May 7 — Every week, a group of experts from agencies around the government — including the C.I.A., the Pentagon, the F.B.I. and the Energy Department — meet to assess Washington’s progress toward solving a grim problem: if a terrorist set off a nuclear bomb in an American city, could the United States determine who detonated it and who provided the nuclear material?

So far, the answer is maybe.

Not heartening.

Politicians May Slow Growth - and Help America’s Competitors - with Big Tax Hike on Capital Markets

The Wall Street Journal appropriately savages a putative Senate proposal to dramatically increase the tax on private equity firms. Senators Baucus and Grassley apparently think it is wrong that fund managers get a slice of the capital gains pie if investments rise in value, and they want to tax those gains as if they were income instead of increases in net worth. In a well-designed system that eliminates double taxation of saving and investment, the capital gains tax rate would be zero, so this proposal clearly would be a big step in the wrong direction. But politicians specialize in bad policy. First, they drove a substantial share of IPO business to Hong Kong and London with Sarbanes-Oxley. Now they want to drive private equity firms out of America as well:

This week Senators Max Baucus and Charles Grassley, the chairman and ranking minority member of the Finance Committee, will hold “informal meetings” to ponder a 133% tax hike on private equity firms. There’s no good rationale for this beyond the fact that Congress wants money and private equity funds have lots of it. Private equity firms will raise and deploy a record one-half trillion dollars of investment capital this year – funds that provide start-up and expansion-phase money for firms large and small. …Senator Grassley says he suspects “subterfuge” that allows fund managers to underpay their taxes. The managing partners of equity funds generally receive compensation in two ways. They charge the fund investors a 1% or 2% management fee for finding high-return business opportunities and for orchestrating the portfolio. Those fees are taxed at the personal income tax up to 35%. But fund managers also typically lay claim to a 20% slice of the fund’s future profits. That return is called “carried interest” and is taxed at the long-term capital gain rate of 15%. Congress is considering reclassifying that income as labor compensation and taxing it at the 35% income tax rate. … Far from being a clever tax dodge, carried interest plays a central role in the performance of private equity funds: It establishes an incentive structure which aligns the financial interests of the managers and investors. …The biggest losers from a private equity tax hike may be pension funds, which have become large investors in these funds; their high performance has made millions of Americans wealthier in their retirement.

WAMU Wags Its Finger, Part I

I listen to National Public Radio in the morning.  The frequent left-wing bias can be grating, but that’s nothing compared to the inaccuracies and condescension of those annoying NPR membership drives.

My local NPR station is WAMU, which broadcasts from American University in Washington, DC.  WAMU is holding one of their membership drives this week. In the past, I’ve heard NPR and WAMU personalities lecture listeners that we are “free riders” unless we cut them a check.  The only problem with that argument is that WAMU receives about 7 percent of its revenue from the federal government, which means that every WAMU listener already contributes to the station – albeit involuntarily.  Calling any of WAMU’s listeners “free riders,” therefore, is the sort of inaccuracy of which a journalist should be ashamed.

This came to mind at about 8am today when I heard a WAMU reporter reprove, “It is important for you to become a participatory member.” As if I weren’t already.

I value WAMU.  It’s just so darned informative.  But I’ve decided that I’m not writing them any checks until they forswear all involuntary contributions or Congress weans them off of the same

Until then, I’ll try to blog every inaccurate or condescending ploy that I hear WAMU use to belittle my existing contributions.  I encourage my NPR-listening colleagues to do the same.  If we blog enough of them, maybe we can wrap them up and send them to WAMU as a very special contribution. 

Though I wouldn’t count on getting the tote bag.

The Flat Tax May Spread to Bulgaria

The global tax reform revolution may soon include Bulgaria. The Sofia Echo reports on the pressure - thanks to tax competition - for Bulgaria to hop on the flat tax bandwagon:

It won’t be surprising if in a couple of years Bulgaria introduces a flat 10-per cent tax on incomes, Georgi Angelov, senior economist at Open Society Institute, said, as quoted by Pari daily. Radical reforms are carried out more easily in countries with radical problems, such as those in Eastern Europe. A quarter of the countries in Europe levy a flat tax. The first to introduce a flat tax rate was Estonia – 26 per cent in 1994. The tax has been cut to 22 per cent already and the fashion has spread to neighbouring countries like Lithuania, Latvia, Russia and Ukraine. The example has been followed by Slovakia, Romania, Georgia, Serbia and Macedonia, with the Czech Republic and Albania expected to apply the lowest rate of 10 per cent from 2008. According to Angelov, one of the reasons for that is that Bulgaria has so far focused on reducing the corporate tax. Now that the tax has been cut to 10 per cent, the logical step is to reduce labour taxation by implementing a single rate. Just a few years ago, a 10 per cent tax was wishful thinking, but now it is a fact.

Abundance Has Arrived

Today is the official release date for my new book, The Age of Abundance. In it I offer a new interpretation of American history since World War II – one that focuses on the sometimes exhilarating, sometimes disorienting social changes triggered by the advent and deepening of mass prosperity. The civil rights movement and the sexual revolution, environmentalism and feminism, the fitness and health care boom and the opening of the gay closet, the withering of censorship and the rise of a “creative class” of “knowledge workers,” the decline of machine politics and the mad proliferation of subcultures and lifestyles – all, in my telling, are the progeny of economic abundance. Furthermore, I argue that the upshot of all these changes is a much more libertarian America, although politics has not yet caught up to the new social reality.

I’ve also started up a weblog, www.brinklindsey.com, as a companion site for the book. The idea is to comb the Internet’s massive historical archives for materials and imagery that relate to the book’s themes. Check it out!

DHS Privacy Committee Declines to Endorse REAL ID

The Department of Homeland Security’s Data Privacy and Integrity Advisory Committee is filing comments on the REAL ID regulations. Comments close today (Tuesday). Instructions for commenting can be found here, and apparently, due to difficulties with the automatic comment system and with receiving faxes, DHS has opened an email address for receiving comments: oscomments [at] dhs [dot] gov (subject: DHS-2006-0030) . Emails must have “DHS-2006-0030” in the subject line.

The Committee took care to offer constructive ideas, but the most important takeaway is summarized by Ryan Singel at Threat Level:

The Department of Homeland Security’s outside privacy advisors explicitly refused to bless proposed federal rules to standardize states’ driver’s licenses Monday, saying the Department’s proposed rules for standardized driver’s licenses – known as Real IDs – do not adequately address concerns about privacy, price, information security, redress, “mission creep”, and national security protections.”Given that these issues have not received adequate consideration, the Committee feels it is important that the following comments do not constitute an endorsement of REAL ID or the regulations as workable or appropriate,” the committee wrote in the introduction to their comments for the rulemaking record.

I’ll be testifying on REAL ID today before the Senate Judiciary Committee.