Friday, October 31, 2008

What may be coming

I've had the opportunity to do some radio interviews around the country on the election and the Supreme Court. What I have to say on the subject is summarized in this piece that I wrote for WI Interest.

A host on a syndicated show that I understand airs in Tennessee, Indiana and New Mexico asked me whether "technically, we can say that Barack Obama a Marxist?"

No, he's not. But, to the extent there is a consistent theme in his career, it is one that places him firmly on the left of American politics.

Much of his campaign has been focused on trying to obscure that. His public record is limited enough to be explained away as indeterminate. He's a guy who has never held one job for more than a few years and whose resume largely consists of aspiring to the next thing. This has certainly been an obstacle to his campaign, but, in a way, it has also been an advantage. It enables him to define himself.

If he was a leftist community organizer and someone who wrote an autobiography steeped in the presumptions of the left, it can be dismissed as a youthful interlude. If he chose as a spiritual mentor and father figure an intemperate, race-baiting radical, it was just something that grew out of his racially equivocal origin and search for his African-American identity. If he served on a board with an unrepentant terrorist and Marxist shoveling money to politicized and ill considered educational projects, it's just one little thing. Does he have a highly partisan and liberal voting record? That record is brief enough to be dismissed and we are asked to believe what he says and not what he's done.

The positions he has adopted for purpose of the campaign are generally way stations to more fully interventionist and redistributive policies. He has not proposed a single payer health plan, but the logic of what he as proposed - offering the federal plan as a guaranteed and subsidized alternative - will move us in that direction. He hasn't proposed tax increases for most of us, but his stated desire to use tax credits to spread the wealth plan and plans for new spending would require him to do so.

In addition, his rhetoric outpaces his position papers. He has promised to change the nature of our world and lots of his fans believe him.

That doesn't mean that he will try to govern in that way. Those who believe that he won't want to say that political expediency and his own intelligence (i.e., he's too smart to believe his own class warfare rhetoric)will moderate his policies. The report that he is making plans to "dampen expectations" sounds consistent with this view.

But, at the end of day, it makes more sense to judge a candidate by his past deeds and present rhetoric, rather than projecting onto to him or her some heretofore undemonstrated moderation. After years in the wilderness, the American left will expect this to be their time. They are likely to claim a mandate and, if they do, may promptly lose it.

Wednesday, October 29, 2008

Shark on the Air

I will be on Charlie Sykes' show tomorrow at 8:30 or so to discuss the election and the Supreme Court.

There is nothing to see here

As I blogged yesterday, I think that the 2001 interview with Barack Obama is unclear as to whether he believes that the constitution should be interpreted to confer rights to certain redistributive policies. That is one plausible reading. But it also may be that he is saying that the courts are a poor forum for pursuing such policies. The only thing that is clear is that he is sympathetic to what a caller calls "reparative economic work" and that, whether rightly or wrongly, its not going to come from the courts.

This has resulted in two lines of attack on Obama. One is that he favors the type of judicial activism that constitutionally mandated redistributive policies would constitute and that he would appoint judges who would want to bring that about. I agree that the interview, standing alone, does not prove or disprove those charges. I would note, however, that some of Obama's key legal advisors and defenders, including Cass Sunnstein, a prominent legal academic often mentioned as a potential Obama nominee to the Supreme Court, seems to favor precisely that.

The second line of attack is that, whether or not, he wants to do it through the courts, Obama favors substantial additional redistribution. As blogged yesterday, part of the response to this is too cute by half. We know that the government already redistributes money and that neither John McCain or Sarah Palin has argued that it never should do so.

But will Obama favor a substantial increase in redistributive policies? Professor Sunstein and Emily Bazelon say that there is no evidence for this.

But there is.

Obama has proposed tax credits (he calls them cuts) and spending increases that may cost at least 4.3 trillion dollars over the course of his administration. In addition to what he has proposed, his rhetoric - calling for the government to (as if for the first time) heal the sick, provide jobs and stem the rising of the sees suggests even more.

What do we know about Obama's past? We know that he had a very liberal - and very partisan - voting record in both the Illinois and United States Senates. We know that he was a "community organizer" working for things that can fairly be called "reparative economic work." We know that he is steeped - this is where Ayers, Wright, Pleger and ACORN come in - in the leftist politics of Hyde Park and the south side of Chicago. We know that, if he wins, he is likely to have large Democratic majorities who believe it is their time.

Is it possible that Obama will recognize that there is only so much "reparative" work that can and ought to be done. Possibly. But we know that he has no compunctions against shifting his positions and that his history suggests that he is to the left of every Democratic nominee since McGovern.

I hardly think this is a phony issue.

Tuesday, October 28, 2008

Shark on the Air

Locally, I will be on Joy Cardign's show on Wisconsin Public Radio during the 6 am hour. We will be discussing the Supreme Court and the election.

Words Fail Again

This is the second time in the past month that former Madison Mayor Paul Soglin has written something astonishingly ridiculous.

First, he compared Bill Ayers to someone who supported Newt Gingrich's Contract for America. Nail bombs and tax cuts, whatever.

But now he suggests - not metaphorically but literally - that Sarah Palin is a fascist - "a charismatic American political leader with a populist bent who can lead a viable political movement towards fascism."

He offers absolutely no support for this, seemingly basing his view on the fact that she is a social consrvative (the Nazis, incidentally, were not) and is, at least in style, a populist - what some have called a "Sam's Club conservative."

If I thought there was something close to a cogent argument there, I'd respond. But there isn't.

A commenter suggests that Paul get a grip. Some Lorazepam might help.

Monday, October 27, 2008

Obama and wealth redistribution

I briefly discussed Obama's comments on the courts and the redistribution of wealth on a morning radio show on KRSM in Osage Beach, MO (OK, I'm on the B-team) and expect to do a few more around the country in the next few days.

The response of the Obama supporters to the issue in general seems to be that there is nothing particularly revolutionary about the state redistributing income and there is a sense in which that is true. If you believe in government provided services - even the standards like roads, schools, national defense and law enforcement - and that these services should be funded by a tax - even a flat tax - based on income, wealth or property value (as opposed to user fees or a pro rata charge), then you support some redistribution of wealth.

But this is hardly the "gotcha" that it is claimed to be. And that's where the interview is instructive.

Obama notes, mostly correctly, that courts have largely (although not entirely) seen the constitution as a guarantor of negative liberties, protecting you from the government rather than requiring that the government do anything for you. They have not much addressed the redistribution of wealth or become involved in what one caller during the interview called "reparative economic work."

The interview - or at least the portions that we have heard - makes clear that Obama is not,as he put it, "optimistic" about accomplishing this work through the courts. What is not clear is whether he thinks this is because it cannot be done well in this way (he suggests that is the case), is not required by the Constitution (he talks about the Constitution as "it has been interpreted") or just as a matter of addressing the likelihood of success. At one point, he suggests that legal arguments in support of such reparative work could be made.

But what is also clear is that he believes that this work is in order. The state, if not by judicial fiat then by legislation, ought to remedy the economic injustice wrought by markets.

Here's where we start to sort people out. I certainly believe that we should give everyone an opportunity for an education and that certain public facilities and services should be provided for everyone. I even believe that there ought to be a safety net that guarantees basic subsistence and medical care for everyone. I know of few people who don't.

But, at the same time, I think that most of what passes for "reparative" economic work is counterproductive. Obama, in his interview, suggests that it was a tragedy that the civil rights movement remained "court-focused" and either because of the limitations of the Constitution, nonresponsiveness of the courts or unwieldiness of the judicial process, did not accomplish this economic reparation.

I respect and like many people who hold that view. I can see its attraction. But it's wrong and, if adopted, would represent a hard left turn from policies which, over the past 30 years, have been spectacularly successful.

Sunday, October 26, 2008

It's Halloween Week

Do the mash

Feed your Frankenstein

Do the Time Warp

Burn the Witch

Curl up with your Spooky Girl

Because Bela Lugosi is dead

Shark for McCain

I have a column in this morning's Milwaukee Journal Sentinel presenting an opposing view to the paper's endorsement of Obama.

One of the things that I hinted at but couldn't develop in a 700 word op-ed is concern with a full-throated return to the idea, not only that government does the most important work in our society, but that this work can change the nature of our lives.

I quoted a line from a recent column by Michael Gerson to the effect that, if Obama is elected, the "least responsible, least respected, least popular political institution in America - the Democratic-led Congress - would also be the most emboldened." Gerson suggests that Congressional Democrats will push for "divisive measures that punish and alienate businesses, seek backward-looking political vengeance and impose cultural liberalism."

Gerson says that Obama will need to stand up to him and suggests that he might, citing Obama's identification of Reinhold Niebuhr as one of his favorite philosopher. Niebuhr, who wrote in the wake of the second world war, emphasized the fallen nature of man and the reality of evil, arguing for a Christian realism that that recognized that the kingdom of heaven cannot be realized on earth. Gerson sums this up as a theology of "conflicted humility."

The problem is that I see little of this in Obama. I have blogged in the past about concern over the grandiosity of his rhetoric and the out-sized expectations of his supporters. Some readers were upset, pointing to the allegedly modest fine print in Obama's position papers and criticizing me for suggesting that anything about Obamamania was dangerous.

I know that Obama has said that "we should be humble and modest in our belief we can eliminate" the pain and suffering in the world. He says, nevertheless, that we shouldn't trade "bitter realism" for "naive idealism."

Well, I agree. And that's why we shouldn't think that the state can heal the world and make the waters to recede. It's why policies that emphasize collective approached centralized in the state, particularly the federal government (see,e.g., his health plan) ought to be viewed with suspicion.

But this election is, I think, about whether we are going to hang on to that suspicion.

It's possible that Obama will stand up to the Barney Franks of the world. But I don't expect it.

Saturday, October 25, 2008

Barbara Bussiere 1948-2008

My parents were divorced when I was very young and my Mom remarried when I was 9. My stepfather was - and is - one of the rare people (but, maybe not so rare, since it has been the rule rather than the exception in my life) who absolutely accept their spouse's children as their own. He did it so well that he lost the "step" prefix and my sister and I - with some fits and starts that were largely our fault (and more mine than my sister's) - continued our relationship with him after he divorced my Mom when we were young adults.

Dad was lucky. He remarried a wonderful woman. One of the ways in which she was wonderful was that she saw it as her duty - or maybe her privilege - to act in a way that strengthened the relationship between her husband and his ex-wife's children.

Barb was not a person who did splashy things. She was someone who committed numerous acts of kindness and decency - a smart and wise woman who figured out that loving was a pretty good way to live. I am so sorry that Aidan Esenberg (5)had a diminished opportunity and that Caleb Esenberg (3 months) really had no opportunity to know my Mom. I also wish that they would have had the opportunity to know Barb.

Barb suffered a ruptured brain aneurysm two weeks ago and, after some complications of surgery, passed away. We are better for her example and diminished by her absence.


Tuesday, October 21, 2008

Biden's Oddity

Michael Kinsley famously defined a gaffe as a politician saying something that is true. If that's so, then Joe Biden gaffed spectacularly on Sunday in suggesting that Barack Obama would face some type of international crisis shortly after his election.

The point is rather obvious. We would have an untested President coming from the - use the word that you want - less aggressive wing of American politics. There is every reason to believe that he would flinch and it's likely that someone will try to find out.

But Biden's statement that Obama will need his supporters' "help" because it intitially will not be evident that "we're right" is just odd. How can he know how they will respond to an undefined crisis and whether how that response will initially be perceived? Is he signalling that Obama plans a staunchly internationalist and less muscular approach to foreign threats? It's either that or more of Biden's peculiarity.

And we're supposed to be worried about Sarah Palin.

Sunday, October 19, 2008

Blues for a Sunday

We're on our way to Lambeau and I'm not very optimistic. The polls still depress me. So how about some Sunday blues?

The Allman Brothers see only one way out. That's something to hope for.

One of my favorites in Susan Tedeschi. Here's "Just Won't Burn."

You can't mention Susan without thinking of "Angel From Montgomery."

Susan is married to Derek Trucks who performs "Highway 61:Revisted" with Johnny Winter:

Best line:

God said "you can do what you want, Abe, but/
Next time you see me coming you better run

Why Joe had a point

In response to a post last week on Obama's tax plan, one reader sets fervently sets forth the politics of the Obama idea:

Obama's tax plan will not increase taxes for anyone making less than $250,000. Let me repeat that: Obama's tax plan will not increase taxes for anyone making less than $250,000.

There was no need to repeat it. It's being repeated over and over again. Here are the problems:

1. I don't believe it. The Democrat leaning Tax Policy Center says that Obama's plan will add almost three trillion dollars to the deficit and, of course, Obama proposes almost a trillion in new spending on top of that. The TPC says that McCain's plan doesn't add up either, so we know that neither one of these guys will do exactly what they say.

2. Obama's rhetoric and record points to more taxation.. Obama's underlying political philosophy - to attract votes by taking from a few Peters to pay many Pauls - suggests what he would do. If it's OK to raise taxes on the top 5% to give money to others, then why not the top 10,15,25,or even 40? The idea is that Obama's instincts are to raise spending and taxes. McCain's are otherwise.

3. Obama's instincts are anti-growth. Higher marginal tax rates, all else equal, create disincentives for work or investment and incentives for unproductive tax avoidance. Of course, there may be reasons to raise them and one reason might be to reduce the deficit, but that's not Obama's reason. I might buy into small increases in marginal rates to bring government's expenditures more in line with its revenues, but Obama simply proposes to redistribute the wealth.

This is, I think, more likely to create less income than more.

That doesn't mean, as the commenter suggests, that I oppose public education or a public safety net. But those things exist and no one is proposing to do away with them.

4. The third rail remains untouched. The greatest policy failure of may generation has been the repeated refusal to deal with the coming entitlement crisis. Obama's suggestion - lifting in some way the cap on social security taxes - is a potentially disastrous disincentive to growth.

5. Obama's America is further divided into tax payers and tax recipients. One of the impact of the GOP's relentless "tax cuts for the rich" is to remove large numbers from the income tax rolls altogether. Both McCain's and Obama's proposals would increase that number from approximately one third of all filers to something approaching 50%. Obama exacerbates the problem by increasing the number who receive a government check. Do we really want large numbers of voters - perhaps a majority - to be net recipients of government largesse?

6. Obama will have to feed a hungry Congressional majority. Apart from Obama's own political proclivities, it looks like he will have large Democrat majorities in both the House and the Senate. Having been out of power for so long, there is going to be a great deal of pent up demand for new programs.

All of this was, I think, captured in Obama's answer to the now iconic Joe the Plumber. He wants to "spread the wealth around" as it is all his to bestow.

Thursday, October 16, 2008

Aren't lies vile?

Writing in the Wall Street Journal, pop-Marxist Thomas Frank suggests that raising the connection between Bill Ayers and Barack Obama is the GOP's "vilest" hour.

Why, exactly, would that be? The Ayers connection is a fact and, although McCain has not handled it well, it - along with a number of other things - tells us something not about his patriotism or his propensity for violence (I don't question the former and he hasn't the latter), but about his politics.

But Frank's accusation plays into the dominant story line. This is something that is over the top and unfair and even dangerous, focusing on a few nutjobs (at least some of whom turned out not to exist) who shouted vile things in rallies attended by 20,000 other people who did not.

But there's another story line and McCain hinted at. Barack Obama has spent an enormous amount of money on campaign ads and much of it is negative. Of those negative ads, a rather significant percentage are lies.

I don't use that term lightly. I think that much of what we call "lies" in political discourse is either an honest error or a tendentious presentation of the facts or an argument that we believe is wrong. A "lie," in common parlance, is an intentional misrepresentation.

And that is precisely what Obama's ads on McCain's health care plan and position on stem cell research are. McCain's plan would not raise taxes on people who recieve employer provided health care or increase costs for employers. McCain supports even embryo-destructive stem cell research.

These are lies repeated over and over again - even after they have been identified as such.

Now that strikes me as vile.

Wednesday, October 15, 2008

Too true to dismiss as lies

Local blogger and teacher Jay Bullock is concerned that the media has allowed Congressman Jim Sensenbrenner to "lie" about the cause of the financial crisis. The "lie," according to Jay, was that the government acted, through th Community Revinvestment Act and GSEs like Freddy and Fanny, to weaken underwriting standards.

As you can read here and here and here here(subscription required), this is not a lie. It's true. Freddie and Fannie as Jay points out, did not make these loans but they made a market for them. If Freddie and Fannie would buy the loans, then lenders would make them. Moreover, Freddie and Fannie, by virtue of their size and influence, could go along way in making the market, influencing what other players in the secondary market would do and what type of loans are deemed acceptable.

It is undeniable that the federal government, during both the Clinton and Bush administrations, pressed Freddie and Fannie to support a market for "affordable" loans.

While its true that HUD lost subprime market share in 2006, it bought an awful lot of bad paper in the preceding years. Nor is it clear that the "tougher standards" that it was subject to helped. It certainly did not prevent the two from owning so much of this stuff that they failed.

There are other ways in which the government facilitated this mess. In 1993, the Boston Fed issued new - and looser - underwriting guidelines. The CRA, in this story, was not so much a cause in and of itself as it reflected a larger movement toward encouraging homeownership by "rethinking" underwriting standards. These looser standards then came to be accepted outside the context of minority and low income loans.

The CRA, in this story, is part of a well intentioned, but wrong-headed, direction in policy which occurred over a number of years in a number or ways.

Of course, that's not the whole story. The influx of foreign cash and Fed policy resulted in ridiculously low interest rates. This, in turn, encouraged more aggressive pursuit of returns and the ability to offer incredibly low ARMs. All of this took place in the context of typically American expectations about ongoing increases in the value of housing. In some areas, this was exacerbated by strict zoning and environmental regulations that artificially restricted the supply of housing.

I don't think that this issue can be reduced to an argument of unregulated markets v. central planning. The markets in question were highly regulated but they weren't regulated well. Government tried to move the markets but, to the extent it succeeded, moved them in the wrong direction.

But all the mistakes that the government made would not have been enough had buyers and lenders not misjudged the housing market. It took a village to make this crisis.

Tuesday, October 14, 2008

Obama misses the point

Barack Obama doesn't like John McCain's proposal for a temporary reduction in capital gains rates to get the economy moving. It won't work, he says, because no one has any capital gains.

Great economic analysis for a lawyer and community organizer. The absence of capital gains is precisely why McCain wants to lower the rate. The idea is that the prospect of lower taxes will increase the upside for those who gamble on the purchase of potentially undervalued assets like, say, real estate or mortgage-backed securities.

Words fail

A remarkable post by Paul Soglin over at his blog. Paul wants us to give Bill Ayers and Barack Obama a chance. Sometimes, he says, you have to work with people that you don't agree with to get things done. Paul notes that he himself was forced to work with a minister who opposed pornograpy, a businessman who was, in Paul's words. "homophobic" and even someone who supported Newt Gingrich's Contract with America.

So let's not be so critical of Obama for choosing to accept the support of, work with and praise the writing of someone who wanted to bomb buildings and kill people. If Paul Soglin had to work with a Republican businessman, then we can certainly see how Barack Obama had to work with an unrepentant terrorist.

The post inadvertently illustrates just why Ayers and Wright matter. It takes a special political perspective to think that a critique of America that is so harsh that it prompts one to blow things and people to bits is the moral equivalent of the Contract for America or even retrograde views on pornography or homosexuality.

It requires one to stand well on the port side. What Obama praised about Ayers (his book) and what he did with Ayers (funnel funds to radical and politicized educational initiatives)confirms this.

Monday, October 13, 2008

Finding the real Obama

Great op-eds over the weekend by Patrick McIlheran and this morning in the Wall Street Journal on Obama's tax plan. Obama's tax cut consists of mostly refundable tax credits. These will reduce some folk's taxes (particularly if they are paying college tuition or have a mortgage) but much of it will go to people who do not pay taxes. As Pat points out, this will increase the currenty dynamic in which large parts of the population pay no federal income tax. Although the way to resolve this may be to increase income in the bottom percentiles, doing so through what amount to welfare payments creates an unhealthy political dynamic. As the Wall Street Journal notes, Obama's redefinition of checks from the government as tax cuts allows him to avoid acknowledging the way in which his plan increases the size of the government and contributes to disincentives to work as they are phased out. Under the Obama plan, couples making as little as $ 120,000 could face marginal tax rates as high as 45%.

Over at National Review Online, Joseph Antos has a good piece on Obama's health care plan and its potential, over time, to shift everyone into a government plan.

The theme here is that Obama's policies are cloaked moves to the hard left. If, however, this was the change we need, why not be more forthcoming about it.

This is why I think Ayers and Wright are, if handled properly, fair game. It's not that Obama shares all their views. It's that he is far enough to the left to see their views as within the pale of responsible discourse.

Sunday, October 12, 2008

Sunday's rock from over the hill

I just finished Winston Groom's history of WWI in Flanders and am moved to offer Dire Strait's "Brother In Arms."

And since we are on Dire Straits, I have always liked "Romeo & Juliet."

Thursday, October 09, 2008

ACORN sprouts weeds

Local blogger Jay Bullock tries to defend ACORN from the mounting allegations of fraud in its voter registration activities. He ought not to have bothered.

ACORN's defense is that it is the victim of unscrupulous or lazy employees who register phony people in order to meet quotas, keep their jobs or just avoid doing the hard work of signing up real people. It says that it tries to identify bad registrations and turn them in.

Two things seem certain. First, if ACORN is really trying to sort out bad registrations, it's not doing a very good job. Second, ACORN has registered many voters who do not exist.

Here is what is not certain. Is ACORN (or persons within ACORN)corrupt or incompetent? Are these phony voters going to actually cast votes in November or has ACORN just foulded the registration rolls?

I don't know the answer to that and I don't see how anyone else can either. I do know that requiring a photo ID at the polls would remove any uncertainty.

Wednesday, October 08, 2008

Let's not hear about rhetoric that is a "dangerous" "distraction"

The debate was boring and will not help McCain. What may help over the next three weeks is an increased focus on Obama and his ideology. One way that McCain - and the independents - will get at that is his associations. As I blogged earlier, they are important not because the measure of Obama is who he has made important in his life but that his choices tell us something about him

This will, of course, be criticized as a distraction and as a departure from discussion of the "important issues that face the American people." Indeed, Joe Biden, citing a nutjob in one of Palin's crowds who shouted "kill him," archly suggests that this is not a place that we should go.

But is that right? Certainly claiming that Obama's associations with the extreme left (e.g., Wright and Ayers) tell us something about who he is may be inflammatory. This is no even if the idea is not that Obama is "just like" Wright and Ayers, but that he has a world view which permits Wright to be a trusted advisor and Ayers to be an acceptable political colleague - someone whose programs you fund and with whom you can sit on boards.

So is the principle that we ought to avoid inflammatory rhetoric? Is it that we must restrict ourselves to discussion of specific policies?

If it is, Obama is certainly off to places where he should not go. Asked about the financial crisis during last night's debate, he said what he always says:

And I believe this is a final verdict on the failed economic policies of the last eight years, strongly promoted by President Bush and supported by Sen. McCain, that essentially said that we should strip away regulations, consumer protections, let the market run wild, and prosperity would rain down on all of us.

This is, at best, meaningless and, at worse, utter nonsense. I have yet to hear anyone identify any deregulation during the Bush administration - whether or not supported by McCain - that played any significant role in the financial crisis.

I can think of government policies that may have played a role, but there are the Fed's easy money policy, the refusal (led mostly by Democrats)to enact tougher oversight of Freddie and Fannie (this is one bit of regulation that the Bush administration favored) and Freddie and Fannie's decision to make a market for junk - fueled, in part, by the political class' desire to expand homeownership. I can think of forces that were not caused by the governent, such as the influx of cash from overseas.

But I can't point to much in the way of deregulation. It is, of course, possible to imagine a set of regulations that might have prevented the problem. We just identify whatever went wrong and, with 20-20 hindsight, say that it ought to have been prohibited. But, as I have blogged before, it is hard to imagine anyone who would have supported such regulations before the fact.

So it is hardly a thoughtful or nuanced discussion of the issues.

But is it inflammatory?

Well, it's of a piece with Obama's Grapes of Wrath rhetoric. "They," he says, have made you "settle" for less. If it's inflammatory to criticize Obama for his dalliance with those on the far left - something that may tell us something about who he is, why is it not inflammatory to stir class envy and resentment?

Monday, October 06, 2008

Facts matter: The super rich and middle class do not pay similar federal tax rates.

Local blogger and MATC instructor Michael Rosen suggests that we have an essentially flat federal tax system. In linking to a post that Rosen called "Cherry picking distorts Obama's tax proposals", WisOpinion titles it "Middle class and super rich pay similar federal tax rates."

This would be an interesting bit of news were it true. It is not.

Rosen relies on an article in the Los Angeles Times. That article but says it relies - without links or other specifics - on the Tax Policy Center. The Tax Policy Center, in turn, seems to rely on the Congressional Budget Office for effective federal tax rates. Let's go the the recent work of the CBO and see what that tells us.

In 2005, the top quintile consisted of households earning over $ 91,706. Contrary to Rosen's implication, taxpayers in that category pay an effective rate significantly higher than those with more modest incomes. With respect to incomes taxes, the effective rate for the top 20% was 13.9% compared to 5.9% for those in the fourth quintile ($57,661 to $91,705 in 2005) and $ 3.0 for those in the third 20% ($36,001 to $57,660 in 2005). (These numbers are different than the marginal rates because they are the average percentage of total income paid in federal income tax.) If we look at higher earners, the disparity gets larger - the effective federal income tax rate is 17.6% for the top 5% (average income of $457,400 in 2005) and 19.7 for the top 1% (average income of $1,299,300 during that year).

A typical response - and the one that Rosen makes is that we ought to consider all federal taxes. This isn't obviously correct. Social security taxes are capped at a certain income level because the amount that a person can collect in benefits are also capped. If I can't collect more than x dollars in benefits, the argument goes, why should I keep paying into the system after a certain income level.

But let's put that aside.

The CBO does just what Rosen wants to do, adding in social security, excise and corporate taxes. This reduces progressivity but certainly does not eliminate it. The top quintile has an effective rate of 25.2% compared to 17.3% for the fourth and 14.1% for the third quintiles. The top 5% pays 28.7% of its income in federal taxes while the top 1 % pays 31.4%.

So, if we define the super rich as the top 1%, these households pay do not pay a similar federal tax rate. In fact, they pay an effective tax rate that is more than twice that paid by those who are smack in the middle.

You can argue that this isn't progressive enough and there have been years of greater progressivity but these numbers are more or less comparable to what we have seen over the past thirty years. Indeed, the most dramatic decline in effective federal tax rates (considering all taxes) has not been among the rich, but among the poor and lower middle classes. From the last year of the Carter administration to 2005, the effective rate for the lowest quintile has gone from 7.7% to 4.3% and, for the second quintile, from 14.1% to 9.9%.

Rosen argues that the rich pay most of the federal income tax (and of all taxes) because they make a lot of money. That is certainly true. But the tax system remains progressive. According to the CBO, the top 1% earned 55.1% of total income in 2005 and paid 86.3% of the total income tax and 68.7% of all federal taxes.

Now, one can bemoan the fact that the top 1% make that much money, but the problem, if there is one, isn't the tax system.

*As a bonus for you real policy wonks, the CBO study may not precisely match other tables because it adjusts for household size and includes all pretax income. That doesn't change the story, but one could argue that the CBO slightly overstates the tax burden on higher income workers because it assumes that capital, i.e., the shareholders, pay corporate taxes. This is in keeping with what proponents of high corporate tax rates like to argue. Critics of corporate taxation argue that they tend to fall on labor and consumers. I don't think that this makes a huge difference here and, in any event, I would not expect to many who lean left on these issues to argue that corporate taxes are simply passed on to workers and customers.

An answer to Brazen Maverick's rhetorical question

I posted a response to Sam Sarver's rhetorical question on political discourse over at the Marquette University Law School Faculty Blog.

Sunday, October 05, 2008

Baseball oldies

I am about to leave for game 4 of the NDLS. I have a feeling that today is the series. If we see the good Suppan and the Brewers manage to win, we are going to see Sabathia on four days rest. Hamel will be tough but I have the feeling that the Brewers may be waking up. So here is today's theme:

And, we hope, that this is this week's:

But, win or lose, it's great to see good baseball in Milwaukee. I wore a Milwaukee Braves cap yesterday in tribute to our only World Series win. I'll wear to again. I'm all about retro.

Barack, Bill and Bernadine

The New York Times weighs in this morning on the Ayers-Obama connection and does a rather poor job. The relationship between Ayers and Obama was not as close and influential as the relationship between Obama and Wright, but neither was it as sporadic and happenstance as the Times wants us to believe. Stanley Kurz fisks it here and you can learn more by following his links.

But does it matter? The best take on it that I have seen is offered by Dave Bernstein at The Volokh Conspiracy:

Obama is an extremely ambitious man. He's been interested in a national political career for many years. It's not that surprising that he wouldn't find Ayers and Wright objectionable company--in the very liberal, Hyde Park/Ivy League circles that he's traveled in since attending Columbia, people with such views are more mainstream than, say, the average conservative evangelical Christian. That itself makes Obama far more liberal than the image his campaign attempts to portray.

But what is interesting to me is that not only did Obama not personally find anything especially obnoxious about Wright's radicalism, anti-Americanism, ties to Farrakahn, and so on, or Ayers' lack of regret for his terrorist past, he apparently didn't expect that much of anyone else would care, either. How else do you explain why he didn't jettison these individuals from his life before they could damage his presidential ambitions? How else do you explain how his campaign seemed to be caught flatfooted when Obama's ties to Wright and then Ayers became campaign issues? And, perhaps most tellingly, how else do you explain that when Obama was asked in a debate with Clinton about his ties to Ayers, he analogized his friendship with Ayers to his friendship with Senator Tom Coburn, as if being friends with a very conservative senatorial colleague is somehow analogous with being friends with an unrepentant extreme leftist domestic terrorist?

In short, Obama's ties to Ayers and Wright suggest to me NOT that Obama agrees with their views, but that he is the product of a particular intellectual culture that finds the likes of Wright and Ayers to be no more objectionable, and likely less so, than the likes of Tom Coburn, or, perhaps, a Rush Limbaugh. Not only that, but he has been in his particular intellectual bubble so long that he was unable to recognize just how offensive the views of a Wright are to mainstream America, or how his ties to Ayers would play with the public, especially post-9/11.

Shark on Dead Tree

Here's my column in this morning's Milwaukee Journal Sentinel.

Friday, October 03, 2008

Sarah is back

Committed Obamniaks (to borrow from Joe Biden's use of what is apparently the term of Bosnian Muslims) are not going to like Sarah Palin's performance in last night's debate. Too folksy and not their girl. Committed conservatives liked her performance, but generally take issue with her description of the cause of the financial crisis which, while not as wrong as the Obama/Biden Bush-era deregulation argument, still creates a fundamentally flawed picture of what has happened. There certainly were ways that Wall Street could have been reined in (although I can imagine Democrats supporting none of them), but the fiasco could not have happened without government intervention in the market through the vehicles of Freddie and Fannie, easy money and well intentioned, but misguided efforts to encourage home ownership.

But such is politics. A careful and thorough public debate over economic policy is simply not going to appeal to the overwhelming majority of voters.

So, let's move to the big picture. Going into the debate, the conventional wisdom was that Palin had to show that she belongs on this stage. There is no question that she did that. There will be postdebate back and forth on who said what that isn't true. My sense is that both of them - whether intentionally or not - tool a few liberties, but that Biden's inaccuracies were less debatable, more significant and, I think, more frequent.

But I think voters expect politicians to do that. In this debate, Palin needed to rekindle the fire that she ignited in the base early on and squandered in her interviews with Gibson and Couric. She did that. She needed to remove herself as a reason not to vote for McCain. She did that as well.

The great hope - something to be wished for but not expected - was that she scuff up a Democratic ticket that has gained tremendous momentum from the financial crisis. That depends on the spin. There were certainly enough moments in which she gave Biden a good natured schooling that this could happen.

As for Biden, he performed well. He is incredibly good at gravely intoning utter nonsense. (For example, we do not spend more in three weeks on combat operations in Iraq than we have spent to date in Afghanistan. It's not even close.)

But this debate was about Sarah Palin and she came through.