It’s Not Just Lower Taxes — Taxes Are Being Replaced With Regressive Fees

Matt BruenigThe brilliant Matt Bruenig has written another great article that expands the way that I look at economics, Nontax Revenue Accounts for 92% of Growth in “Taxpayer Money” Since 1970. The basic idea is one that I’m well aware of because I see it everywhere I go. Politicians are terrified to raising taxes. So they create fees and tickets and, as a last resort, sales taxes. The result of all this is to remove the tax burden from the rich and pile it onto the poor.

Think about traffic tickets. If a poor person is caught driving 35 in a 25 mph zone, the cost of the ticket is exactly the same as if a billionaire is caught doing the same thing. Think about that because it’s shocking. It means that the poor person is massively punished while the billionaire is effectively not punished at all. In fact, that billionaire might be able to fight the ticket and win in court. It really isn’t very hard when you have a lawyer since police officers have skimpy notes and no actual memory of the event. But even if they just pay the ticket, it is unfair. It is, in fact, what I’ve been arguing that the rich really want: each person paying the same amount in taxes — even a flat tax would be unacceptable to them.

Bruenig noted that we should stop discussing “taxpayer money.” For one thing, after people pay taxes, it is no longer theirs. But more important, discussing government money this way frames it in a deceptive way. This is how we get pundits on Fox News and CNBC talking about all the taxes that the rich are paying to the government — completely ignoring the taxes and all the other revenues that the poor pay. They just don’t count, even though as the title of the article indicated, since 1970, 92% of all government revenue increases have come from these sources. In 1970, roughly 12% of total government revenue came from these highly regressive sources. Now the number is almost 21%.

Another area of this is benefit cuts. The government doesn’t just take money and then go out to Las Vegas for a vacation. It gives that money back to the country and its people. This is an issue that Dean Baker has written about a lot. People want to cut Social Security, but they never think about the fact that voters will not be keen to continue to pay 15% of their paychecks if they aren’t getting anything back for it. Cuts are effectively just another form of tax.

As long as we continue to focus on taxes — which is what the power elite want us to do — we will see these revenues decrease. And we will see more and more of the cost of running the government and providing services fall on the backs of the poor and the middle class. So just looking at the tax burden on the rich, we see them paying less. And we see the overall tax burden reduced to be replaced by even more regressive fees, tickets, and reduced services. The power elite have been very clever. They’ve managed to make people living in an oligarchy think they live in a democracy.

Lots Ways to Measure Unemployment — Pick One

McDonald'sDan Diamond wrote a cheeky little article over at Vox, Donald Trump Says the “Real” Unemployment Rate Is 42%. He’s Really, Really Wrong. It’s about how Trump has been going around saying that the real unemployment rate is 18%, but then more recently 21%. Who knows what this is about? But his claim that the unemployment rate is 42% at least makes some sense. It is based upon the idea that only 58% of the people over the age of 16 have jobs. According this, school kids and retired people should all be working. What do you expect? It’s Donald Trump.

But it does raise an issue that is interesting. There are many ways to measure the unemployment rate. There are two that we standardly use here in the United States. The first is the one everyone knows: U-3. It does not include discouraged or involuntary part-time workers. It is currently 5.3%. The other measure is really more meaningful: U-6. It includes as unemployed, everyone who wants to work full-time but who isn’t. It is currently 10.4%. It doesn’t really matter which measure you use. The main thing is that you have to be consistent. And people aren’t — at all. It’s really sad to watch because it shows a total lack of intellectual integrity.

What Trump is doing is not at all unusual. I’ve been hearing conservatives — especially people on Fox News — saying that we should really use U-6. Like I said: that’s fine. But these same people didn’t want to use U-6 when George W Bush was in office. They just want to use it so they say, “Unemployment is over 10%! Obama is destroying the economy!” But you just can’t do that. This is just a way of saying that the unemployment rate was 7.8% (U-3) when Bush left office and is 10.4% after six and a half years of Obama. But the actual comparison looks like this:

President U-3 U-6
Bush 7.8% 14.2%
Obama 5.3% 10.4%

None of this is to say that Bush was terrible for the economy and Obama was great. The truth is that the unemployment rate was bound to go down. But you can’t say that the economy has done horribly under Obama. The most you can do is make the argument that the economy hasn’t improved as much as it could have under Obama. And that’s an argument I do make, although the blame is not primarily Obama’s but rather our entire political system.

But what this does show is that you can’t just pull out a different way of measuring unemployment and claim that things are worse than anyone knows. Everyone understands that the unemployment rate is not a perfect reflection of the state of the job market. But including discouraging workers into the calculation doesn’t make the economy any worse. The economy is just the same as it is. And whether you want to use U-3 or U-6 or something else, we see that the economy is improving.

Copyright, Community, and Collaboration

First News Alert

Perhaps my only disappointment with Frankly Curious is that not enough other websites link to my articles. I do get some. Certainly, a lot of people Tweet out my articles, I get a certain amount of love from Facebook and Reddit, and of course, Crooks & Liars links to me. Also, Google sends a lot of people and that results in normal and very pleasant links from more established blogs like Lion of the Blogosphere. This is all for the good and I really like it. My disappointment is that I don’t get enough of it.

There is, however, a certain kind of linking that I do get that really annoys me. There are websites that do nothing but print other people’s content. They are often of high quality and they no doubt see themselves as news aggregators. The problem is that they don’t publish a couple of paragraphs and provide a link. They publish the entire article with a note at the bottom, “This article, [whatever], first appeared on [wherever].” One such website is First News Alert. Well, this website did this to me yesterday and I was not pleased. But let me back up a bit.

I am not that keen on our copyright system. And I don’t mind all that much if people want to use my content. But this outfit was added nothing. It was just using me as an unpaid writer. Even the statement at the bottom of the article saying that it was from Frankly Curious wasn’t highlighted — it just looked like the last paragraph of the article. The entire website is designed to look like it has a staff of writers, which it clearly does not. And it has all kinds of ads so the owners are clearly making some money off it. I have a problem with that.

But it is even worse than this. At the bottom of the page was printed, “© 2015 First News Alert… All rights reserved.” So there was a page that consisted of 99% my own content and they were claiming copyright! But hell, if it was a big website, it might have provided some people clicking over. But no. Frankly Curious is huge compared to First News Alert. And I checked my site statistics this morning, and sure enough: not a single person clicked from that article over to Frankly Curious. So I got nothing in terms of traffic and even the name “Frankly Curious” wasn’t highlighted, so I didn’t even get any name recognition.

But I’m a liberal guy. I might have just dropped the whole thing. But then I looked at the code for the page. And I noticed that the link to my page had the attribute rel="nofollow." That is a way to tell search engines not to follow (crawl) the link. But more important, it tells search engines to disregard the link when it comes to the ranking of the page. I almost never use them, but I used it in the link above to First News Alert out of spite — but also just because I want the search engines to know that I’m writing about the site in a negative way. They shouldn’t think that I’m linking to the site because it has content that I’m discussing.

So let’s review: a tiny website stole my content; it did little to highlight where the content came from; it did not ask my permission; it claimed copyright; and it didn’t even do me the favor of linking to my page to give it proper search engine credit. But even still, I wasn’t too angry. I just wrote them a short note pointing out the problems and asked that they at least remove the rel="nofollow" or take the page down. Within an hour, the page was down.

I must admit to being amazed by all this. What I do — both here and in my paying work — is create content. I understand that not all people are good at this. I’m not good at working on cars. This is why I pay people to work on my car (when I have one). If you want to have a website, you either create your own content or you find someone who will do it for you. First News Alert looks like a competent website. But its philosophy seems to be, “We don’t need no stinkin’ original content.” And so they just steal it from other sites. But that really isn’t the way that the internet works. There are writers all over the world who are looking for an audience. The last thing they need is a website like First News Alert diluting their efforts and taking their credit.

Morning Music: Sarah Ogan Gunning

Sarah Ogan GunningMoving on with our week of “Man of Constant Sorrow,” we have a woman. Recently, I’ve been marveling at the fact that people — including a lot of feminists — get their ideas of the traditional place of women in society from the 1950s. But the truth was that when humans were hunters and gathers, there were women hunters and men gathers. It has been civilization itself that enforced gender roles.

Right about the time that Emry Arthur was giving up music, Sarah Ogan Gunning recorded the song with her own lyrics as “Girl of Constant Sorrow.” The lyrics focus on the poverty of the coal mining region that she was from. This a cappella version is probably from 1965, but it is doubtless much how she sang in in 1936. (Roscoe Holcomb did a similar version in 1961.) It’s haunting and beautiful:

Anniversary Post: Not First Motion Picture Camera

William Kennedy DicksonOn this day in 1891, Thomas Edison patented the motion picture camera. It’s a great example of how the patent system doesn’t work. Let’s start with the fact that Edison didn’t invent it, but rather one of his employees, William Kennedy Dickson. And it wasn’t the first motion picture camera. But it was a good design. But why would Edison get a patent on it? Lots of people were doing the same thing. But by that point, Edison had the lawyers necessary to take his team’s minor achievement and put the force of law behind it.

If the patent system had worked the way it does today, Edison’s patent would have done wonders to slow cinema as an art form. In fact, Hollywood owes its existence to filmmakers fleeing the east coast to get away from having to pay Edison royalties on every film they made. At this point, I would have to say that our intellectual property laws do more harm than good in terms of innovation. Regardless, I don’t know why people claim that Edison invented the motion picture camera. He wasn’t even close.

The first surviving film by Louis Le Prince was made in 1888 — almost three years before Edison patented his camera. Oh my God! What would we have done if we hadn’t given Edison that patent?! We might be stuck with a film industry that is, I don’t know, exactly the same as the one that we have today. The horror!