Category: tax policy

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crime and punishment folly free trade & free markets general freedom tax policy

Gold Leaf

cannabis, marijuana, legalization, tax, taxes, federal, Colorado, illustration, Jim Gill, Paul Jacob, Common sense

The experiment in legalized marijuana begun by citizens in the states of Washington and Colorado has, from the beginning, faced a huge obstacle: marijuana is still illegal, federally. State nullification of federal law is not merely “problematic,” it’s hard to “get away with.”

Take Colorado’s experience. The Centennial State, which has made the swiftest and most extensive progress regarding marijuana retail sales, has come up to an inevitable problem with the federal government.

Over banking.

Interesting Reason reporting tells us that “Marijuana-related businesses in Colorado are so profitable that the government doesn’t know what to do with all of the tax revenue they’re generating. But business owners face a more immediate problem: Where to stash their own profits when banks won’t take it.”

Congress has been very active making banking less and less private and less and less free for decades now, in part because of the War on Drugs. Existing banks refused to take new cannabis clients.

So a new credit union was formed, to handle the cash.

And now, NBC News tells us, our central bank, the Federal Reserve (dubbed by NBC “the guardian of the U.S. banking system”), said “that it doesn’t intend to accept a penny connected to the sale of pot because the drug remains illegal under federal law.” Which makes modern banking difficult, even for a credit union, apparently.

What are “weed” businesses to do . . . other than what they are doing, hiring security guards for all the cash?

Maybe Bitcoin will step in. Or old gold-warehouse banking, as was not unheard of even in the 19th century.

Or, maybe, the federal government will cease its over-reach?

This is Common Sense. I’m Paul Jacob.

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cannabis, marijuana, legalization, tax, taxes, federal, Colorado, illustration, Jim Gill, Paul Jacob, Common sense

 

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general freedom individual achievement responsibility tax policy

Plotting Progress

Angus Deaton, Nobel Prize, Economics, The Great Escape, Inequality, collage, photomontage, JGill, Paul Jacob, Common Sense

The prestige of the Nobel Peace Prize has been tarnished by some more-than-dubious awards, in our time . . . Henry Kissinger and Barack Obama, most obviously.

Same goes for the Bank of Sweden’s knock-off “Memorial” prize for economics.

But, according to David R. Henderson, this week’s Nobel nod to Scottish-born Angus Deaton, for his “analysis of consumption, poverty and welfare,” is “a fine pick.”

Deaton is, writes Henderson, “an important chronicler of the market’s abilities to create wealth and improve society.”

While it is all the rage, these days, to complain about increasing inequality, Deaton has been instrumental in showing that wealth, health and welfare have increased as poverty, worldwide, has decreased.

And this has been largely the result of markets. Not big government programs.

Deaton, Henderson tells us, “believes that the approximately $5 trillion given by governments of rich countries to poor countries over the past 50 years has undercut good governance by making poor countries’ leaders less accountable to their own citizens.”

ABC News seconds Henderson’s account:

In his 2013 book, The Great Escape, Deaton expressed skepticism about the effectiveness of international aid programs in addressing poverty. . . . China and India have lifted tens of millions of people out of poverty despite receiving relatively little aid money. Yet at the same time, poverty has remained entrenched in many African countries that have received substantial sums.

Peter G. Klein, at mises.org, identifies a deeper insight by the latest Nobel economist: “aggregate measures of consumption and inequality conceal important differences among individuals.” This explains why Deaton came to his other (controversial) conclusions: he never took his eye off the real player in market life, the individual.

This is Common Sense. I’m Paul Jacob.

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Angus Deaton, Nobel Prize, Economics, The Great Escape, Inequality, collage, photomontage, JGill, Paul Jacob, Common Sense

 

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Accountability national politics & policies responsibility tax policy

Raising Taxes & Truth

tax, taxes, debt, national debt, truth, collage, photomontage, JGill, Paul Jacob, Common Sense

Sheila Weinberg wants to raise your taxes. So fervent is her money-lust that she even threatens to run for president, and only half-jokingly, on that single issue.

More surprising: I would enthusiastically vote for her.

What gives?

Well, Weinberg isn’t demanding a tax increase or a spending cut, per se — just one and/or the other until accounts are balanced. She points out that tax increases tend to concentrate the minds of taxpayers to oppose greater spending by government. Otherwise, as long as governments — local, state and federal — can hide the true costs of their “services,” more will be spent, and more debt incurred, than the people can afford, or want.

That’s why this friendly CPA founded Truth in Accounting, a nonpartisan, non-profit group working to “compel governments to produce financial reports that are understandable, reliable, transparent and correct.”

Too much to ask? No, if you ask me, or you, or Sheila, or anyone else . . . until we inquire of politicians, and then, well . . . apparently, yes. And not merely at the federal level.

“For years, citizens have been told that their home state budgets have been balanced,” Weinberg recently told Watchdog.org. “If that were true, state debt would be zero . . .”

Yet, last month, Truth in Accounting issued its 2014 Financial State of the States report disclosing that state governments are truthfully — whether they admit it or not — a cumulative $1.3 trillion dollars in arrears. Individually, all but 11 states are carrying debt.

Lies won’t set us free. Or pay the bills.

This is Common Sense. I’m Paul Jacob.

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tax, taxes, debt, national debt, truth, collage, photomontage, JGill, Paul Jacob, Common Sense

 

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Common Sense folly general freedom ideological culture national politics & policies political challengers tax policy too much government

Weekend with Bernie: Fairy-Tale “Free”

Bernie Sanders, Free, Fairy Tale, promises, collage, photomontage, James Gill, Paul Jacob, Common Sense, illustration

Bernie Sanders is many a progressive’s fairy-tale candidate.

Well, yeah.

Not “once upon a time,” but today . . .  the federal government’s public debt is in the double-digit trillions. The total debt — consisting also of unfunded/underfunded welfare state “promises” — may be in the triple digits. Still, politicians pat themselves on their backs when they deliver annual deficits under half a trillion per year.

Meanwhile, Senator Sanders, former member of America’s Socialist Party and current caucuser with the Democrats, is running on the “freebie” platform: let’s spend more!

He serves as the pusher of a very old folly: thinking that good things come to us without cost.

But the costs have to be paid.

And will be.

That’s the essence of common-sense wisdom since ancient times. Usually I conjure up an accountant or an economist to explain this, but why not go back to folklore? Folk and fairy tales, along with myths both ancient and modern (remember Tolkien’s Lord of the Rings?), tell us that magic powers come at a price.

And those costs can be killer.

Far-left-of-center magic pretends that not only can Bernie provide “free” stuff for everyone (including those of us in his “hard-working middle class”), but also that the wherewithal for these goodies (college, medicine, food, shelter, meaningful work) can easily come from . . . three pot-of-gold sources: “the rich,” “print more money,” and that least plausible sprinkle of fairy dust, “government efficiency.”

We tell children fairy tales not to make them wish for magic solutions, but to illuminate the logic of responsibility.

Bernie didn’t get that lesson.

This is Common Sense. I’m Paul Jacob.

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Bernie Sanders, Free, Fairy Tale, promises, collage, photomontage, James Gill, Paul Jacob, Common Sense, illustration

 

Categories
Common Sense general freedom ideological culture moral hazard national politics & policies tax policy too much government

Weekend with Bernie: Hard Looker?

Weekend with Bernie Sanders, http://cognitivebiasparade.prosite.com/, Paul Jacob, James Gill

What is a “democratic socialist”?

According to leading presidential candidate and Senator Bernie Sanders, such a socialist “takes a hard look at countries around the world who [sic] have successful records fighting and implementing programs for the middle class and working families.”

I don’t believe him. He shows his cavalier attitude in his next few words: “When you do that you automatically go to countries like Denmark, Finland, Norway, Sweden . . .”

Competent comparative economics doesn’t simply focus on a few policies one happens to admire and then trumpet them for America. Other countries following Bernie-branded socialist policies are in or headed into the proverbial toilet, i.e. PIGS (Portugal, Italy, Greece and Spain).

The common-on-the-left meme runs like this: “No Other Advanced Country,” which Kevin D. Williamson handily demolishes in a recent article:

If we are to go around the world cherry-picking policies from happy countries, we might pass over French paid-leave laws in favor of the Swiss capital-gains tax (generally 0.00 percent) or the Swiss national minimum wage (there isn’t one), or Finland’s very liberal (in the good sense of that word) education system, or Sweden’s free-trade regime and its financial-regulatory system. We’d have to make radical improvements on our federal balance sheet to get our public debt down to Norwegian levels.

American success has never really been about copycatting Europe. We need to look hard at those who pretend otherwise — like nova Bernie, the rising star of the left, who’s now besting Hillary in polls in New Hampshire and Iowa.

And about “democratic socialism” — extreme redistributionism in a putative republic — Bernie needs to look hard at the worldwide experience . . . not hardly look.

This is Common Sense. I’m Paul Jacob.

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Weekend with Bernie Sanders

 

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Accountability Common Sense initiative, referendum, and recall tax policy

Evergreen Eyman

Stubborn Beast

“Initiative 1366 is blackmail,” one plaintiff charged.

No; it’s just political hardball.

Washington State voters have cast their ballots five times (by initiative measure) to require a two-thirds vote of both houses of the state legislature, or a vote of the people, to increase taxes.

Though the rule is neither hard to understand nor difficult to implement, legislators have repeatedly overruled the people they supposedly serve, overturning the measure and then, finally, suing to overturn the repeatedly re-enacted two-thirds requirement.

The Washington Supreme Court ruled that only through a constitutional amendment could citizens place upon their representatives the two-thirds mandate. And — you guessed it — the state’s initiative process doesn’t permit constitutional amendments, only statutes.

As I reported back in June, Tim Eyman and Voters Want More Choices haven’t skipped a beat. Their grassroots army collected over 335,000 voter signatures to place a new initiative on the ballot. This measure would cut a penny from the state sales tax unless legislators propose an amendment to the state constitution establishing the rule that taxes can only be raised via a two-thirds legislative vote or a popular vote.

The day after the signatures were verified and the measure placed on the ballot, a group of legislators and various special interests sued to block the measure from going to a vote. Last Friday, the court declared that Initiative 1366 would remain on the ballot for voters to decide.

So, whether “blackmail” or ingenious hardball, it looks like voters will have a chance to send a very direct message to their representatives: Do what the people want or else.

This is Common Sense. I’m Paul Jacob.

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Stubborn Beast