This is delicious!

Back in 1981, when the recently elected President Ronald Reagan was pushing to lower income taxes, he said something that is really great to the Washington Post. Unfortunately, that particular article doesn’t seem to be online, so I’ve had to get it from The Christian Science Monitor, No “Voodoo” in Dole’s Tax Cut.

Are you ready, because this is really great. Wanna get a beer? Some popcorn? Okay, here we go:

There’s a serious part of the this, but let’s just bask in the glow of that false equivalence. The great Hollywood stars: Bogart, Gable, and… Reagan?! You gotta give it to the guy, he didn’t lack for confidence. Let’s see now: Bogart starred in Casablanca and The African Queen. I assume you’ve heard of those. Gable starred in the Oscar sweeping It Happened One Night (also one of my very favorite movies) and a little sleeper called Gone With the Wind. And Reagan starred in (well: co-starred in) Knute Rockne, All American and Bedtime for Bonzo. For the record, Bonzo Goes to College was far better, but Reagan wasn’t in it. Not that I’m implying anything!

But the truth is that the high tax rate was not actually limiting Bogart and Gable from making films. From 1936 onward, the top marginal tax rate was at least 9 percentage points higher than it was when Reagan was complaining about the tax rate in 1981. But Bogart wasn’t making two pictures per year. Of course, he really didn’t become a star until High Sierra in 1941. But from 1945 onward, when he was a big star and the top tax bracket was 90% or more, he made a lot of films. In 1953, with a tax rate of 92%, he made three big pictures: The Caine Mutiny, Sabrina, and The Barefoot Contessa.

Similarly, with Gable, who was a star much earlier, he made five films the year he won the Oscar for It Happened One Night. He only made two the year of Gone With the Wind, but that isn’t surprising since the principal photography for that one film took up over half the year. Regardless, you know that if it took Reagan two films to reach the 90% tax rate, that Bogart and Gable reached it in one film easily.

But if you look at stars today: Johnny Depp or George Clooney, they also make about two films per year. This is despite the much lower top marginal tax bracket and the much lower capital gains rate, which they get as being executive producers.

What’s especially interesting though, is that Reagan was lying about himself. Throughout the 1940s and early 1950s (after which he got into television), he made tons of movies. So I don’t even know what he’s talking about. Maybe the dementia was already strong in 1981.

Reagan went on to talk about how the fact that he wasn’t willing to make more movies meant that grips and other movie professionals were hurt. The idea I guess is that rather than find another actor, the studio would just not make a movie because people only wanted to see a chimp work with Ronald Reagan. The studios make what the studios make. If George Clooney dies tonight, Hollywood will make exactly the same number of pictures next year.

Anyway, I thought that quote was funny as hell and I had to share it. It is weird though, that conservatives always talk about how liberals don’t see the world as it is. But they just make up stories to prove their points. If we were to believe Reagan, To Have and Have Not never would have been made, because the top tax rate was 94%. What was Bogart thinking!

Today: a love story.

You may remember back a couple of days when I wrote about The Music Man. My favorite part in the movie is when Marian’s mother asks what the gentleman wanted and Marian replies, “You’ll find it in Balzac.” I must have been seven years old when I heard that line and I knew I had to find out about this Balzac character. Her mother then later mentioned that, “She never read it.” That’s funny because Honore de Balzac, who was born on this day in 1799, wrote 91 essays, novels, and short stories, in addiction to 46 unfinished works all collectively known La Comedie Humaine (The Human Comedy). Balzac was not at all a smutty writer, but he is pretty much the first realist writer—he wrote of the world (post-Bonaparte France) as it was. He was a huge and direct influence on Dickens, but there are few great writers who followed him who were not, most notably Henry James.

In 1931, Balzac published La Peau de chagrin (The Magic Skin) about a poor and lonely man who gets a magic bit of rawhide that will grant all his desires. But with each desire, the rawhide shrinks and takes part of the man’s vitality. This isn’t like a the genii in a bottle where you make a wish, he finds that he can’t control it. The book ends with the hero wanting to die in the arms of the woman he loves while she runs from him, trying to kill herself in order to save his life. Of course, just as with The Monkey’s Paw (published 70 years later), the rawhide will not be denied and the two consummate their love before he dies in her arms.

The following year, Balzac got an anonymous letter without a return address. It criticizes the novel for its cynicism and its negative portrayal of women. Balzac was so impressed with the letter that he placed a classified ad in the Gazette de France. Soon he found that the letter came from Ewelina Hanska. She was in a marriage of convenience to a nobleman and landlord, so the two could not run off together. For 15 years they corresponded, until Hanska’s husband died in 1941. Thus began a nine year courtship. (Apparently, Franz Liszt was also trying to win her favor.)

The two finally married on 14 March 1850. But by then, Balzac’s health was failing and he died six months later—kind of like in the novel. Still, it is sweet that the two managed to get together. And they had been friends for almost 25 years.

Happy birthday Honore de Balzac!

Do you know what I really hate? People who do a really bad job working for the government, and then retire to high paying jobs and six-figure book deals. Today, of course, I’m speaking of Timothy Geithner and his book, Stress Test. Now sure: Geithner isn’t the worst guy in the world. In fact, I think he was the perfect Treasury Secretary for Obama: basically a Bush kind of guy who is very concerned about the global economy. But he doesn’t care about it because instability actually kills people. He cares about it because millionaire bankers might not get their yearly bonuses.

In the 1950s, they said, “What’s good for GM is good for America.” Well, that wasn’t true, but it was a hell of a lot more true than what they say today, “What’s good for Goldman Sachs is good for America. Because at least what was good for GM was not generally bad for America. Despite the repugnant “Progress” commercials that Goldman Sachs is flooding the world with, in generally what is good for them is bad for America. And by “America” I mean the people.

Aside from Geithner spending what is apparently hundreds of pages showing that it wasn’t just the banks who were stress tested, he makes some economic arguments. He was very big for bailing out the banks, because, hey, each tear a millionaire sheds causes an angel to burst into flames. But when it came to things that would help the regular economy—you know, places you shop; places you work—he didn’t really care. Now Geithner claims he was not against stimulus. “I was not an austerian.” But as Paul Krugman pointed out this morning, three years ago when the heroic Christina Romer pressed the White House for more stimulus, Geithner snapped. “Stimulus, he told Romer, was ‘sugar,’ and its effect was fleeting. The administration, he urged, needed to focus on long-term economic growth, and the first step was reining in the debt.” Sounds like he was very much an austerian. And, not to put too fine a point on it:

But it is more than that. Geithner argues that the administration was right to bail out the banks while just letting homeowners suffer and allow a foreclosure crisis. His reasoning is that doing that wouldn’t have really helped the economy. “The economy” is Geithner speak for the millionaire bankers who invite him to parties and hire him for high paid jobs like president of Warburg Pincus. But it looks even worse than that.

Two economists—Atif Mian and Amir Sufi—have looked at his economics, Why Tim Geithner Is Wrong on Homeowner Debt Relief. Geithner wrote, “We did not believe, though we looked at this question over and over, that a much larger program focused directly on housing could have a material impact on the broader economy… it would have increased annual personal consumption by just 0.1 to 0.2 percent” So it wasn’t worth doing. Mian and Sufi’s article is a little technical, but they find a number of problems with Geithner’s assumptions. First, there is this thing called the marginal propensity to consume (MPC). This is how much less you will spend if the value of your house goes down. There is a vast amount of research on this and the number comes out to be between 5% and 10%. Geithner assumed 2%—less than half the lower limit! What is that I smell? A rat, perhaps?

Mian and Sufi then go on to do the calculation correctly and find that the actual number would have been ten times higher. And remember: this is just the direct effect. Their article gets into some other details that I’m not that interested in. But let’s assume their base number of 1.3% increase in GDP from mortgage forgiveness. We usually multiply any direct number by 1.5 because spending spreads through the economy. So that’s a 2.0% increase in GDP. Roughly one and half million jobs are created for every 1% increase in GDP. So this program that Timothy Geithner thought wasn’t worth doing would have created three million jobs.

But even if Geithner’s 0.2% number had been right, it still would have represented a half million jobs. But the truth is that Geithner was, is, and always will be focused on debt. Because that’s what’s in the interests of the rentier class that he represented and now is officially part of as the president of Warburg Pincus. Not to put too fine a point on it:

He should be chased out of the country, not held up as our savior.

On this day in 1925, Malcolm X was born. He was the black man who scared the white folks. And for that, I will always love him. What’s interesting about that is that the Nation of Islam is a conservative group. And if you listen to conservatives today, what they claim that the black community should do is exactly what the Nation of Islam did do and still does. But these very same conservatives are terrified by the group and especially its charismatic leaders. I don’t think it’s at all hyperbolic to say that conservatives want blacks to be separatists but they are terrified that they will be self-actualizing.

The way I see political action, it is necessary to have extremists—or at least those who people perceive as extremists. In the 1960s, whites were afraid of Martin Luther King, but not like they were afraid of Malcolm X. And that gave King more power than he otherwise would have had. As it was, many whites considered King a rabble-rouser and a law breaker. To this day, I read people who claim that he was a communist. But in the end, he became the “good negro” as compared to Malcolm X who was the “bad” or “angry negro.”

(This is why I blame the Democratic Party for the radicalization of the Republican Party. If you want to meet in the middle, you have to give people choices at the edges. All the New Democratic pushing to the center has just pushed the Republicans to the right. Malcolm X and Martin Luther King both understood this simple concept that completely eludes the likes of Bill Clinton and Barack Obama.)

I don’t agree with racial separation because I don’t believe in race. It is just a construct powerful people created to justify their domination of our shared resources. This is something that Ta-Nehisi Coates has written about eloquently for a long time. But I understand Malcolm X’s belief in it. What’s more, I still think it is a valid way for oppressed minorities to thrive. But I still hold on to what is probably a fanciful notion of all of us breading with each other and turning into one big happy brown skinned “race.”

I think that Malcolm X’s greatest work was in front of him, so that his assassination is even more tragic than King’s. Like King, the man had not even reached the age of 40! And I am constantly struck with the fact that Malcolm X was born on the same day as Pol Pot, one of the great villains of the 20th century who lived to be almost twice the age of Malcolm X and died of natural causes. The universe is unjust and thus so too is our culture.

Happy birthday Malcolm X!

On this day in 1048, the great mathematician and poet Omar Khayyam was born. It is a point of some annoyance to me that most people think that mathematics is not a creative field but rather just one where complex rules are applied to problems. But if that were the case, math would be easy. You would just memorize the rules and apply them. But it isn’t like that at all. In fact, in college I noticed that math classes were very much like music classes: some people just got it and other didn’t. (This is an indictment of both math and music instructors!)

There is a very famous story about a very young Carl Friedrich Gauss, which is probably apocryphal, but it hardly matters. Because mathematics education was as bad then as it is now, his teacher had the class add up all the numbers from 1 to 100. I suspect this was more a way to keep the children busy for a while than anything else. But Gauss immediately answered 5,050. His solution was brilliant but also quite easy. He didn’t do what most of us would do: 1+2=3; 3+3=6; 6+4=10… Instead, he noted that 1+100=101 and 2+99=101 and so on. Thus the answer is 50×101=5,050.

So the essence of mathematics is seeing the universe in a different way than others see it. Work is adding together a hundred numbers; play is finding clever ways to not add up a hundred numbers. Work is grinding out yet another story just like the hundreds of stories that went before; fun is finding a new way to tell a story. I think mathematics is the most creative human endeavor because it is normally done without context. It is not much different from the writing of The Marriage of Figaro, except that the audience that can appreciate it is sadly so much smaller.

Khayyam focused on geometry. In a sense, he invented non-Euclidean geometry. Euclid created five postulates from which all of what we think of as normal geometry can be derived. That’s a remarkable thing. But the essence of non-Euclidean geometry has to do with the fifth postulate. It posits a line and a point and says that there is only one line that passes through the point that doesn’t intersect with the first line. For centuries, mathematicians tried to show that you could derive this result from the other postulates, but you simply can’t. However, since it is a postulate, you could say that there are no lines to that do that—or an infinite number of lines that do that. The universe that such assumptions imply are not the universe as we generally find it. But that’s one of the things that makes math such an amazing thing: it’s pure thinking.

He was also a great poet and astronomer and philosopher. And not surprisingly, he was a mystic as I think all mathematicians are. There is something about the nature of mathematics that strikes me as the closest that we ever get to what one might call God. And the ineffable nature of mathematics itself leads one to a simple appreciation of existence itself.

Happy birthday Omar Khayyam!

I’ve spent a lot of time over the last many years wondering, “Would Hillary Clinton make such a bad president?” I’ve thought that because, contrary to what most liberals think, her husband was a terrible president. I know, I know: unemployment was really low. That was great! But that wasn’t him. That was Alan Greenspan who was so crazy that he didn’t accept the idea that 5% unemployment was full employment. Yes, Greenspan was terrible for many other things. But in terms of Clinton’s economic miracle, it was all Greenspan.

What Clinton the Male was responsible for was greatly increasing income inequality, although we didn’t really see it until the tech market bubble burst. There are two big things he did. First, he pursued a strong dollar policy. What that did was push manufacturing jobs outside the United States. Sure, it’s nice to be able to buy cheap imported products. But it’s better to have a decent job. And the second thing that Clinton did was end welfare as we knew it. That too didn’t have an effect right away. It didn’t matter as long as there were jobs a plenty, that our entire federal government became a collective Scrooge, “Are there no prisons? Are there no workhouses?!”

The greatest thing that Clinton the Male ever did was not being Bush the Younger. There’s a reason why Republicans today think he’s just great: he was a conservative. He was the model New Democrat and that’s worse than an Old Republican. And our modern political system is so screwed up that none of his terrible domestic policies (to say nothing of his foreign policies) caused him any harm. But getting fellatio from an intern, that’s something the people care about!

So the question remains. Would Clinton the Female be a good president? Would she perhaps not be just another New Democrat as her two Democratic predecessors? Oh, you see, I can be an optimist at times. But in this case, I find it hard to think that she would break the mold. In addition to her simply being who we all know she is, the rich people who will fund her election are exactly the same people who funded the presidencies of Obama the Hopeful and Clinton the Male. As a group, they all care about what I care about. And on those issues that don’t cost the rich any money, you can depend upon them to do something. Same sex marriage (now that it’s popular): yes! Access to birth control that has only become controversial in the last five years: yes! Social Security for people over 68 years old: yes! How proud we liberals are of our social beliefs!

I will leave aside foreign policy, because we all know that whoever is president is going to continue to murder innocent people all over the world in the name of some kind of rubbish American presidents always spout. But economic issues: they are the crux of the matter. And that’s where we got a nice little introduction of the bold economic plan that Clinton the Female has in store for us, Hillary Clinton Calls on Business to Help Close Income Inequality Gap.

According to the article:

You know what this sounds like? Herbert Hoover! Although you can find this documented many places, Steven Horwitz wrote in Hoover’s Economic Policies:

And they did it! They kept wages high. For the few employees who they didn’t fire, their wages stayed high! See how effective it is to depend upon the good intentions of the business community?

I’ve come to the conclusion that we would be better off with a failed Elizabeth Warren campaign than a successful Clinton the Female campaign. At least a Warren campaign would remind the people of the United States that there are more policy options than “give all the money to the rich” and “give almost all the money to the rich.” This country is badly in need of having its Overton Window expanded. Over the last forty years, we’ve seen the window move to the right, but not expand at all. And that means that “left” now means cutting aid to the poor while “right” means ending aid to the poor and giving ever more aid to the rich. That’s not much of a choice and the American people know it.

We deserve better. And thus far, we are not seeing anything better from Clinton the Female.