The Debt Ceiling Part 2: Taxes

A lot of the conversation surrounding the debt ceiling revolved around taxes. We Americans have a very difficult relationship with taxes that I thought I'd share my thoughts about. If it were facebook official, America would be "it's complicated" with taxes.

I wanna start with a hypothetical interview I wish I could have had with some asshole that was on the Colbert Report. This guy was the head of some interest group that had politicians (a lot of them) sign a pledge to never raise taxes. He then publicly held this pledge over them, especially in the recent weeks. He is essentially of the opinion that it is absolutely never evereverever ok to raise taxes. Here's the transcript of my interview with him. Since I can't do it in person, I'll vent by enacting it here.

Me: So it's safe to say that you don't like taxes. Is it safe to assume that you'd enjoy a tax cut?

Asshole: Absolutely. Taxes blahblahblah bad blahblahblah

Me: So why not lower taxes to zero?

Asshole: because then the government couldn't function..oh wait I guess taxes are good for something after all. I really AM an asshole! I certainly don't deserve the amount of media attention nor access to politicians that I've been given! I bow to your wisdom and debating prowess.

Everyone hates paying taxes, and in a very short-sighted way cutting taxes appears great. People will theoretically have more money to spend/hire people, stimulating the economy. Except that human behavior is not that easy to predict. Turns out that while some will spend more, other will hoard that money. Also, cutting government revenue means that government workers will be fired, and less money will be going out to government contractors, etc. etc. My point here is that there are both pros and cons to taxes, unlike what other people are espousing.

Its amusing how many of the people that dislike "big" government and push for it's downsizing are really hurting themselves. Cutting government spending means less government farm subsidies for the midwest, less funding for schools, defense programs, social security, medicare, infrastructure building, etc. etc. etc. All of which will end up destroying jobs and could end up hurting the economy. That's not to say that it couldn't help the economy either- I won't pretend to be some expert economist. It's simply a double edged sword that might hurt you in the longer term.

So nobody likes paying taxes, but everyone likes when Uncle Sam covers the tab. It's why playing politics with advocating a "smaller" government is a very tricky thing to do. Reduce anybody's government funding and they'll hate you. Maybe why the right worked so hard to demonize teachers and their union in previous months. And now, they'll probably be hurt by playing with defunding medicare- they've alienated the elderly.

Specifically in terms of the recent debt ceiling crisis. I don't find it unreasonable to raise taxes on the wealthy. We have a really large gap between the poor and wealthy, and our wealthy are so wealthy relative to world standards, that I don't think that asking them to contribute a little extra to the society that gave them so much is unreasonable. Corporate tax increases could end up hurting the economy, I guess it'd depend on what the taxes actually are and how they work, but increasing them I wouldn't find to be too unreasonable. Again depending on how they actually work.

The concept of a balanced budget amendment is utterly ridiculous. First, I feel like our constitution is too important to be edited to have something as unimportant as a balanced budget in it as law. Keeping a deficit under control is important, but having it absolutely balanced isn't. Secondly, our government would have to be either have to be so small as to be a non-player in global economic and military events, or taxes would have to be so high as to de-incentivize doing business in the US. Either way, requiring this as a prerequisite for saving the US economy again points to the Tea Party as being unfit for power.

The Debt Ceiling Part 1: A Nation Pokes Itself in the Eye

I really think that this financial crisis has really brought out that which is worst in Washington. I find it utterly ridiculous that we have come this close to defaulting on our debt as we drown in partisan squabbling and posturing. But we got what we paid for, did we not America? Did we not vote for this in the midterms?

In the past midterm we Americans voted in these Tea Party freshmen Representatives on the promise of smaller government, less taxes, and basically opposing Obama on everything. During the negotiations, the close-minded and compromise-adverse Tea Party caucus did a great job of making the crisis a thousand times more difficult to solve. I feel like John Boehner is a rational negotiator, but he was seemingly held hostage by these wackos on the far right. I do applaud the Tea Party for bringing our huge debt to light as a public and political issue. I sharply criticize the single-mindedness with which they pursued their own solution.

Boehner's plan seems to be pretty rational to me, although I don't know the exact details. His was essentially to cut future spending, raise the debt ceiling, create a committee to work on future debt reductions either through raised taxes or spending cuts, and require votes in both chambers on the balanced budget constitutional amendment. Remove the required vote on the constitutional amendment, and his proposal sounds quite reasonable to me and it's essentially what Obama's balanced approach wanted, albeit with tax increases as a possible committee recommendation rather then put into immediate effect as law. Which to me is totally reasonable. His proposal did not pass the House to which he is Speaker of, because the Tea Party Caucus didn't like it. They wanted a guaranteed passage of the balanced budget amendment and more cuts. That kind of refusal to compromise, i think, clearly demonstrates that the Tea Party isn't fit to hold power.

Reid's plan was something along the lines of even more cuts with no new taxes, saving revenue with the winding down of the wars in Iraq and Afghanistan. Not really sure why this didn't pass the Senate, buuuut I think we can rest assured that House republicans would have killed it there anyway.

And on a related note but different tack, I can't held but feel Bin Laden's hand in this. Bin Laden and his cohorts learned about fighting superpowers in the mountains of Afghanistan, fighting with the Mujahideen there in the 80's against the Soviet Union. Essentially what happened was that the Soviets found themselves in an area with an unfriendly populace, and an invasion that was quickly bogged down (thanks in part to American assistance to the Mujahideen). Public support for the war quickly dropped as their economy was drained, and so the Soviets retreated.

Sound familiar?

Our two wars combined with things like the Bush tax cuts, the Tea Party, etc. etc. to lead us to yet another economic crisis.

Part 2 will be out in a little bit.

Why Books Are Better Than Movies (Harry Potter)

This is something that I've always believed, though it's really come to a head with the release of the final Harry Potter movie and all of the hype surrounding it.

I hate the Harry Potter movies, but I'm a die hard fan of the books. When I explain it to other people, I often offer reasons like "they don't stay true to the books", or "when I read the novels, none of the characters have British accents (which does ruin a lot for me)". Thinking about it a bit deeper however, I think I came up with a more profound reason that can be applied to most movie-vs.-book cases.

Written stories are more like skeletal outlines of the actual story, and your imagination fills in the rest. That's one of the great things about books, that their meaning and power are so relative from person to person because your imagination is most of the story.

Movies based off of books end up confining the story into a smaller box, taking away the imagination aspect of the book. They give to you what each character sounds like, looks like, and acts like. They explicitly show you what every event in the story line is and exactly how it unfolds. Although a book may specify these things in writing, all of these details are still under the power of your imagination. A good example here could be the British accents of Harry and his friends. I do know that they live in the UK and would have British accents, but my imagination didn't give me that, and saved them from trying to sound heroic and macho with those prim and proper accents.

Another aspect of this is that because the power of books lies in each of our imaginations, we can assign greater meanings to the characters and events then we could with a movie. For example. The Tyler Durden of the Fight Club novel is the physical embodiment of an entire philosophy into one man. Tyler Durden of the novel is not just a man, he is an idea. Tyler Durden of the Fight Club movie is still a great character, but seeing him in the flesh detracts from the magnitude of his character. He becomes less idea and more human, which is not all that he truly is.

Through the power of our own imagination filling in the blanks, books engage our higher level cognitive faculties in a way that few movies ever could. Movies are only greater then the books when you enjoy the director's personal imagining of a story more then your own. And that rarely ever happens.

Note, however, that this is not a 2-way street. Books based on movies are generally not that good because the authors have to follow the strict guidelines that the movie has already imposed on the storyline.

A Study in Incentives (Freakonomics-Style)

For those of you who don't know, Freakonomics is a book wherein the author studies human behavior through the variables of incentives affecting human behavior. He then analyses those incentives by using regression analysis or something. It's essentially something I dont know how to do. At any rate, this post is me discussing various incentives that exist in our world. It'll be somewhat incomplete though, as I have no data to analyze, nor the means to analyze it even if I had it.

The first example is rather trivial, but it was the first I thought of and led to me thinking about greater topics. A short time ago, I was watching a TV show dedicated to various "experts" finding bigfoot. Through the course of the show they supposedly witnessed howls of bigfoot, found tracks of bigfoot, talked to witnesses in the area... and then the show ended. It was a lot of foreplay with no sex. Thinking about it however, I realized that the show's creators had an incentive not to actually find bigfoot despite the show's name. They find bigfoot, and the show's over. Instead, they gradually increase the suspense over and over again to get people to tune in. If they finally found him, all of these self-proclaimed bigfoot expert's careers would be over.

That sort of incentive also applies to theoretical physics, though in a different manner. Individually, there is a huge incentive for scientists to discover the theory of everything. Their name becomes a household one like Einstein, they win a Nobel prize, etc. etc. For the scientific field as a whole however, there actually exists an incentive for them to not discover everything. If they do, their careers are essentially over. One might say that those scientists could transition into utilizing their discoveries into practical applications, but that is the role of engineers not theoretical physicists. There is an interesting conflict of incentives here, between individualistic and group-based.

The same thing can apply to cancer research too. Again there is a huge individual incentive to cure cancer, but to the industry at large it might not be. Cancer research is actually a huge industry, and once it's cured the entire thing would go away.

The same rationale could be applied to a myriad of different things. There is an incentive for auto manufacturers to never produce a car that's maintenance-free. Otherwise the demand for new cars would drop, and the entire auto maintenance industry would disappear.

There is an incentive for environmentalists to never let environmental problems go away, otherwise their industry disappears. And yes, there is an industry for it.

This is where my theorizing reaches it's end, for I have no data to analyze to calculate the strengths of these various incentives. It may be that these I listed are trivial, but I think it's interesting enough in that they actually exist despite common beliefs. One would hope that the counter-incentives would be greater then the ones i listed to encourage actual progress.

Also, I highly recommend the book to anyone even vaguely interested.

Where Have All the Great Men Gone?

Maybe I'm alone in this impression that I have, but I thought I'd write about it anyway. It seems to me that today's politicians in general are nowhere near as great as those of the past. By great I mean in their leadership and inspirational ability.

They all seem to be so intent on dividing the country and slandering their adversaries rather then actually leading our nation as a whole. The Founding Fathers were great men of all schools of thought, and their ideas and creative power defined our nation as it is today. It really saddens me that such ability seems confined to the 1700's. Why can we of today not have that same power in our own leaders? We still quote the writings of Presidents dead for 200 years, but no one will ever quote George Bush, Bush Sr. or Clinton in that same capacity. Same with John Boehner, Nancy Pelosi, Harry Reid, etc. etc.

Nobody seems to have anything profound to say anymore. James Madison, Alexander Hamilton, Ben Franklin, Thomas Jefferson, etc. all made contributions to political philosophy/science that continue to influence us today. Whens the last time that you heard of any current politician writing about their theory of governance?

I'm sure present day politicians are capable people, but they don't inspire us. It's really sad that nobody watches CSPAN because it's so dull. There are no great debates over meaningful ideas anymore, only candidates attempting to sell themselves to the public. There are no great impassioned speeches anymore that unite rather then divide us.

Barack Obama is probably the closest to a great politician that I can think of in the present era. Regardless of his actual politics, he is a great orator, and he did inspire millions throughout the country during his campaign. He has since retained his speaking ability, but he seems to have lost that inspirational power. That may be the fault of others opposing him, but he have nevertheless failed to inspire since his inauguration.

The Founding Fathers and other great politicians since may be a high standard to compare other to, but I don't understand why of a population of 300 million we can't have people of similar abilities elected to high office more often. I guess one explanation could be that our nation has an incentive to propagandize the history they teach us, and that there is an incentive for us to believe that our founders were perhaps more extraordinary then they actually were. Maybe everyone since has had similar ability. Somehow, i doubt it.