Friday, February 27, 2004
BUSH = ARISTIDE
Ah, that Senator Harkin! He’s a hoot!
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GAY MARRIAGE: TWO WRONGS MAKE A RIGHT?
I’m a bit on the fence on the issue of gay marriage (although not gay adoption) for some reasons that I may get into in a later post. Nevertheless, there is one argument made by the pro-gay marriage forces that, to me, makes no sense.
Cedar Pundit encapsulates it nicely in his post supporting gay marriage:
I'm actually for so-called "gay marriage." Why? Well, if Britney Spears can get drunk and married and annulled in Las Vegas faster than you can watch the entire Lord Of The Rings trilogy on DVD, then the whole "sanctity of marriage" thing is already out the window. If Liz Taylor and Larry King and Zsa Zsa Gabor can get married and divorced a zillion times, why not the homosexuals? If John Kerry can marry Teresa Heinz and they're not producing any more children, then why not have a couple of women from Portland who have 11 month old triplets get married?
I’ve seen this sentiment expressed before, primarily on Andrew Sullivan’s site. It is true that the heterosexual community has done more than its share of damage to the institution of marriage over the years. But does it therefore follow that it is okay to allow gays to marry regardless of whatever damage gay matrimony may do to the institution of marriage? In other words, it is tantamount to arguing that, well, everyone else is hurting the institution of marriage, so we might as well let gays and lesbians hurt it too. That seems to be the “two wrongs make a right” school of thinking.
Now you may believe that gay marriage wouldn’t hurt the institution of marriage. Fair enough, but that’s a different, albeit related, issue. I’m sure an argument can be made that gay marriage won’t hurt the institution of marriage, one that can deal with the points raised by the likes of Stanley Kurtz and David Frum. But that argument has to be made. It’s not sufficient to simply shrug and say, “Lot’s of non-gay people have hurt marriage, so it really doesn’t matter how much damage gays and lesbians would do.”
Before society goes down the road of gay marriage, it needs to have a serious dicsussion about any possible damage. It would be unwise to dismiss it lightly.
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OUTSOURCED AND INSOURCED
Sometimes I love Tom Friedman, sometimes I don’t. Yesterday, I loved him.
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MORE ON OBSCENCE PROFITS
Chad over at Tusk and Talon compared the profits of three top drug companies with that of Gannett, the parent company of the Des Moines Register. Guess what? Gannett’s profits compare pretty well with the drug companies’. Wonder if the Register will reconsider its unfortunate choice of adjectives.
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MORE ON GREENSPAN
Shawn Macomber has a great piece on Greenspan’s testimony.
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Thursday, February 26, 2004
WAL-MART GOT THE MESSAGE
Yesterday an article appeared at MSNBC reporting that Wal-Mart is “well on its way to becoming the biggest business contributor to the 2004 election.” I wonder what took them so long.
The do-gooders have long been targeting Wal-Mart, and late last year the first real warning shot was fired across Wal-Mart’s bow when the New York Times ran an article with the headline “Is Wal-Mart Good For America?” Apparently that is what finally lit the fire under the retail giant’s rear end.
It wasn’t as though they hadn’t had plenty of warning. The Microsoft example was there for the studying. It’s a case study in what happens when a company tries to mind its own business and stay out of politics. Eventually the pols want to know where their tribute is, and when it’s not forthcoming they start looking for people to come forward and make complaints against the company. Those are easy to find as every company has competitors who are all too willing to help the pols put the smack down on the big boy. After all, it wasn’t Microsoft’s customers who were all fired up about dragging Bill Gates in front of a Congressional hearing or getting the boys at Justice to file an anti-trust suit. No, it was Microsoft’s competition like Sun Microsystems. Since then, Gates wallet has become the pol’s communal property.
Indeed, Wal-Mat was warned directly:
In late 1999, Senate majority leader Trent Lott, then-Arkansas congressman Jay Dickey and others sat down with the company's management in Bentonville and warned that they needed to find a way to play the Washington game. "We told them they should become a participant in the process before the crises hit," says Mr. Dickey, who lost his bid for re-election in 2002.
At the time, Wal-Mart didn’t take the advice, probably seeing the meeting as something of a shakedown (and who could blame them?). But when the Times ran its article, they got the message. Start paying up, or those in power will take you down.
Just like the case of Microsoft, it isn’t Wal-Mart’s customers who are complaining:
The company is facing dozens of lawsuits over its employment practices, as well as challenges from local governments that have tried to block its expansion as a way to protect smaller retailers. Trade unions that have watched well-paying grocery jobs disappear to non-unionized Wal-Mart stores have launched a series of attacks against the company. And with trade emerging as a hot election year topic, Wal-Mart would be the biggest single loser from any restrictions on imports, particularly from China.
Yep: trial lawyers, local governments, and unions. Could there be a more toxic combination?
Of course the do-gooders will say that this just proves the need for more campaign finance reform, the need to get money out of politics. But the problem isn’t too much money in politics. It’s too much goddam politics. That is, if the federal government didn’t have its nose in everyone’s business, would there be as much need for companies like Wal-Mart to pay protection money contribute? Of course not! But because Congress can subpoena Wal-Mart executives to testify, pass all sorts of meddlesome regulations, and urge the boys at Justice to get busy writing briefs, Wal-Mart sees the obvious need to keep the 535 wise men and women from causing problems.
However, even if Wal-Mart has kept the political wolves at bay, there is still a price to pay. The money that goes to campaign contributions and to hire lobbyists means that Wal-Mart has less money to hire new employees or to reinvest to find ways to bring consumers lower prices. That, in turn, will lower its profit margin, which will, in turn hurt its stock price. Is Wal-Mart’s stock part of your retirement portfolio?
Oh well. The 535 wise men and women must have their tribute.
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ON GREENSPAN
I wonder how many liberal editorial pages will run commentary on Alan Greenspan’s remarks yesterday? And if they do, I’ll bet that none will carry the following remark: “To the extent we try to resolve the overcommittment on the government side by raising taxes, we are risking lowering the rate of growth in the revenue base.”
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Wednesday, February 25, 2004
YESTERDAY’S ELECTION RESULTS
What do they mean? Barring a miracle turn around by John Edwards, it is over. Kerry’s three victories give him all of the momentum going into Super Tuesday. If Kerry manages to win even 50% of the delegates on March 2 (he’ll probably win more), he’ll have about 1,200 total.
Edwards really needed a win yesterday. Instead, he managed to embarrass himself a bit with a third place finish behind Kucinich (Kucinich!) in Hawaii. Edwards is going to have to win either California or New York to have any shot at taking the nomination. He won’t win either.
So after March 2, it is Kerry vs. Bush. Then the fun really begins…
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AN AD HOMINEM TERM
No, I’m not surprised that the Des Moines Register uses a term that has no meaning other that to stir up anger and resentment.
Today’s term, boys and girls, is “obscene profits,” as in:
It's natural for companies to do what they can to protect profits. It's difficult to begrudge that, even when those profits border on obscene.
Those making the obscene profits? Why the drug companies, of course. Now, I’d like to know, who defines “obscene profits”? Can I find the term in an economics textbook? And if so, how much profit must a company make to qualify as obscene? Of course, I’d never expect the Register to answer these questions—an attempt to do so might undermine their use of the term.
Anywho, I could go on and on about this editorial but I’ve already taken the Register to task here for similar editorials. And for more on drug reimportation, go here.
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Tuesday, February 24, 2004
A FUN EVENING
Last Friday I had the distinct pleasure of having a few beers with Jeff Cordts of Tusk and Talon and Royce Dunbar of Iowa Libertarian. Second time meeting Jeff, first time for Royce. Both gentlemen are insightful and fun. Thanks guys! I really enjoyed myself.
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COMPLETE INABILITY TO SET PRIORITIES
I really have to hand it to the Des Moines Register editorial page. Despite the state government still facing a budget crisis (although we seem to be on the tail end of it), it wants more spending on the arts, more spending for schools, more spending for the Iowa Values Fund, and more spending for Vision Iowa.
Adding insult to injury, they now want the government to spend money for Universal Pre-School! Why bother setting priorities when you’ve got all these social schemes that need funding?
Before we go down the road of universal pre-school, shouldn’t we first examine how well one such program, Head Start, performs? First off, studies show that poor children enter school behind their middle and upper-class peers in subjects like reading and math. But there is scant evidence that Head Start, since its inception in 1965, has in any way closed that gap. Indeed, a 1969 study showed that whatever gains Head Start kids made over their non-participating peers faded in later years. So what good would universal pre-school do, other than give Democrats another election issue and another way to please on of their biggest constituencies, the teachers’ unions?
Also, why exactly should taxpayers be expected to pay for this? They already provide public education starting in Kindergarten. Why must they be expected to pick up this one? Don’t parents have any obligation to pick up some of the cost of their kids education?
Finally, if Iowa state government takes on another spending obligation, what’s going to happen next time a budget crisis comes around?
Oh well, we can just raise taxes…
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CLOSING THE CORPORATE LOOPHOLE
...so, since we are going to spend so much, and since the money has to come from somewhere, let's stick it to big corporations. They are bottomless ATMs anyway. California proved that.
At issue is a loophole in Iowa's corporate income tax that permits corporations to "hide" money they make in Iowa so that it doesn't look at though it is made in Iowa. Hence, they don't have to pay Iowa's corporate income tax.
According to the Register:
That may be good for the business, but it's bad for Iowa.
Less of the revenue to pay for everything from education to public safety is collected. Local businesses are unfairly disadvantaged because larger corporations are better able to slip through the loophole.
Yep, bad for Iowa because the state government can't spend more.
Then they trump out the old "it's not a tax increase" nonsense:
Closing it isn't a tax increase. It would simply allow Iowa to collect the money owed to it by multistate businesses.
Let's get something straight here: if you pay $1 in taxes this year, and, after the legislature changes the law, you pay $2 next year, it is a tax increase. It doesn't matter if a loophole is closed or if the tax rate is hiked. Any action the legislature takes that makes you pay more in taxes one year as opposed to the previous year is a tax increase.
Then, there is this gem:
Iowa already is a business-friendly state, despite what some seem to believe. And it's gotten friendlier over the years.
Really? And where is the evidence for that? Well, here's a sorry excuse for evidence:
In 1979, corporate tax made up 8.3 percent of Iowa's revenue base. Last year, that was down to 3.1 percent.
So the evidence that Iowa is business friendly is that the proportion of the budget that is funded through corporate income taxes dropped. If it was a crime to torture logic, they'd have to arrest these people.
First, has it ever occurred to the Register that the drop is due to more and more businesses trying to avoid paying the corporate income tax? After all, only "C Corporations" pay the state corporate income tax. Other types--S Corporations, sole proprietorships, partnerships, and farms--pay through the personal income tax schedule. If you can incorporate as one of the other four types, you don't have to pay corporate income tax.
Why would businesses incorporate as something other than a C Corporation? Maybe it has something to do with the fact that the top corporate income-tax rate in Iowa is 12% (highest in the nation), while the top rate for the personal income tax is just under 9%. Indeed, nationwide the number of S-Corporations and Sole Proprietorships have increased since 1978, while C Corporations have remained flat (see page 8). Chances are the trend is the same in Iowa.
So the drop in the proportion or revenue coming from corporate income tax has nothing to do with Iowa becoming more business friendly, and has everything to do with businesses trying to avoid an onerous corporate income tax.
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DINNER GUESTS FROM HELL
John Hawkins has the list.
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