Saturday, December 29, 2012

Congress: Fix AMT now; do the math on spending cuts, and carve-outs; the debt-ceiling limit cometh quickly

Will a last-minute deal that extends the Bush tax cuts (below $250000) before Jan. 1 accomplish anything?
Well, take it one step at a time.  Because the Alternative Minimum Tax (AMT) threshold applies to 2012 taxes (not just 2013), that should be fixed right now by itself.  That should be a separate bill.  That could be the hardest thing to fix retroactively after January 1.

The rest of the emergency package sounds more dubious.  If the middle class is relieved of the risk of the increased taxes, there is less political pressure on spending.  Taxing the rich could take in up to 30% of the needed revenue – but then you need the Chapter S care-out for small business and closely held family businesses and farms, so it gets to be a lot less.  (Norquist stumbled on this today talking about it on CNN with Ali Velshi; you can do the carve-out; every business owner knows that.)

And Congress is very unlikely to keep the FICA tax holiday because of Social Security needs now.  ((Yep, youngsters, I want you to pay my social security.  Because I paid into the system.  So should you. But see my retirement blog today on that).

Then we get to spending cuts.  Yes, Congress may keep extended unemployment benefits going after Jan.1.  But that’s one more spending item.

Most of the spending cuts would come in entitlements, and I think it’s time to do the math.  We need to know exactly how much money each type of cut saves, over a timelines.  (Put it on Facebook.)  And we need to know who gets hurt by each cut.  I’ve talked in detail on my Retirement blog, but we do need an actuarial calculation on the “value” of past FICA contributions, and begin thinking of a carve-out of legal ownership rights (based on FICA contributions) that are beyond the reach of political means testing.
The biggest danger of all is the debt ceiling. I’m not sure that hazards Geithner’s measures could pose for the economy (if he impounds federal worker pension contributions, that ought to include Congress and the president), particularly the tax-free muni market.  But the biggest danger, as I noted on the Retirement blog, is what happens immediately after we go over it in February.  It could be for real this time.

ABC News has a story Saturday with a video and images of a demonstration on Capitol Hill. One demonstrator carries a sign, "Republicans: don't drop the ball on the middle class", link here

Visit for breaking news, world news, and news about the economy

Thursday, December 27, 2012

Second Amendment: a fundamental right comes with an affirmative responsibility

Philip R. Cook, in a (Dec. 26) New York Times book review “Voice of calm in the debate on guns”, a review of “Living with Guns: A Liberal’s Case for the Second Amendment”, by Craig R. Whitney [Public Affairs] brings to the head a major legal point in the way the Second Amendment is argued as a “fundamental right”.

The Bill of Rights, in its wording, notes that “the right of the People to keep and bear arms” was already established.  But able-bodied men were often required to join local or state militia, as colonial America developed and after independence. The earlier right had pre-existed as necessary for life on the frontier.  The intermediate right in a local community of state was seen as necessary to hold off tyrannical external government – the last aspect of which is no longer very practical today as it was in the 1700s.

The state militia have been replaced by a volunteer National Guard.  But during the 1960s, when men were drafted (for Vietnam) they would try to get National Guard or Reservist spots so they could serve just six months.  Nixon ended the draft in 1973, but discussions of reinstating it sometimes come up, as in 1980 (the Soviet invasion of Afghanistan) and of course after 9/11, when Charles Moskos  “came out” for conscription at the same time he was backing away from his “don’t ask don’t tell” policy, realizing that it could make an egalitarian form of conscription in a post-9/11 world impossible.  Discussion of either of these issues is mute right now, but the idea of the draft could come back (although it would probably not be male-only, although the Supreme Court had said in 1981 that it could be constitutional for it to be gender specific).

The overall point is that gun ownership in earlier times has occurred in the context of a personal responsibility to be able to use them properly to help defend the community against real enemies.  The far right today (the “Doomsday Preppers” crowd) sometimes sees it that way – that every person ought to share the responsibility of community defense.

It’s good to remember that many National Guard and reservist enlistees have served multiple “stop loss” tours in Iraq and Afghanistan, almost as if the military still had a back-door draft.

The link for the Times review is here

Wednesday, December 26, 2012

Treasury (Geithner) warns debt ceiling will be reached Dec. 31, acts now; is this "Parlour Timocracy"?

Treasury Secretary Timothy Geithner (or is he “Timo”?) warned Senate Majority Leader Harry Reid today, in a letter, that the United States will reach its borrowing limit on Dec. 31. 

He wrote that he can prolong the padding (or "headroom") of the debt ceiling for a little while, maybe until March 1, by not borrowing money for federal pensions, and by not selling certain Treasury securities to help state and local governments with bond issues. 

The federal pension funds would be reimbursed when Congress fixes the problems.

Apparently news of this letter leaked after the financial markets closed today.  It was not clear how this would affect bond markets, or whether Treasury action could affect the liquidity of tax-exempt bond funds (which many retirees use) in early 2013. 

If the debt limit ceiling were breached in absolute fashion, there is more danger that some social security recipients would not get their benefits than I had thought, because research on the limited nature of the government’s obligations has surfaced (regarding a 1960 Supreme Court opinion; see retirement blog Dec. 13, 2012).  In worst case scenarios, some benefit payments could be lost permanently.
Ironically, I was walking near the Treasury Department building today about the time that “Timo” was writing this letter.  I saw Secret Service cars in the area preparing for the president’s return from Hawaii.  My “mission” was to get some pictures of the Christmas trees in the nearby Willard Hotel, where the NRA had held its notorious press conference Friday.(It's not clear that Congress is on it's way back to snowy Washington yet; we just know that Obama is on his plane, probably reading Timo's letter.)  

ABC World News Tonight did not mention the Geithner letter, but NBC Nightly News mentioned it in passing.

The Huffuington Post story by Luke Johnson is here.

Here’s the link for the Geithner debt ceiling letter today.  

The AP has a story tonight on Yahoo! Finance by Christopher A. Rugbear, link here

It’s time for some parlour diplomacy in Congress; otherwise, expect parlour timocracy. Will John Boehner make AC360's Ridiculist? At least Congress will get a quick lesson in modern music.  

Tuesday, December 25, 2012

The small business carve out would be simple; Are negotiators confused about AMT?; Deconstructionist part of GOP seems to want to see country crash and start over

I got into a conversation Christmas Eve that reaffirms my “suspicion”, or conjecture, that the “controversy” over higher taxes for the rich and the possible effects on small business are easily resolved by a legislated carve-out.

The business owner told me that this would be quite simple for Congress to do.  All non-public corporate owners know how this can be done.  It’s only Congress doesn’t seem to understand it.

Personal and family income is separate from business income, even for closely held family businesses.
Given the recent meltdown of  “Plan B” and Boehenr’s leadership, it’s noteworthy that the more radical members of Congress have no specific proposals for how to solve the nation’s fiscal problems.

You can’t pin them down to details.

There seems to be a faction in Congress that believes its purpose is to destroy the current federal structure entirely (the “deconstruction” that I discussed on the “BillBoushka” blog Dec. 23), so that the world is left as a Darwinian struggle of survival of the fittest.  So, yes, this idea is dangerous.  You might has well turn off the power like tin the NBC show “Revolution”.

There is indeed something dangerous when someone "unelected" (like Norquist) can wield so much power just with "ideology".  But he did win "converts" first and make them sign his pledge.  
E. J. Dionne has written recently (in the Washington Post) that the GOP majority in the House cannot govern the country.  Only a coalition of Democrats and “pragmatic” (or moderate) Republicans in the center can do so.   That is, a “Chris Christie” or Giuliani type of Republican will govern and compromise for the good of the country, but a Sarah Palin will not.  A Mitt Romney probably would have.  I wonder about a Rick Santorum.

The Washington Post has a chart on “going over the cliff” here.  I noted one inaccuracy.  The Alternative Minimum Tax thresholds actually are set back down to 1993 levels for the 2012 year, not just 2013, so they affect taxes due even next April.  Mine would go up about $1400.  Taxpayeres would need to make up most of their deficits with the Jan 15 2013 Estimated Tax Payment. 

Sunday, December 23, 2012

NRA's remarks suggests a compromised view of liberty in modern society

I must note my own delayed repulsion to the tone of Wayne LaPierre’s comments Friday morning (December 21) at his NRA press conference at the Willard Hotel. 

I agree that society needs a systematic strategy for public school security for minors, and this includes their transportation routes as well as the school property itself.  The priorities given to the TSA, bank security and the government itself suggests that some comparable effort is needed for schools, and that a presence of armed police officers is appropriate in some circumstances, as well as heightened response capacity and hardened physical security. 

However, consider what he said: "The only way to stop a bad guy with a gun is for the good guys (and girls) to have guns."  This idea suggests that we have to live out our lives watching our backs, because the world is inherently uncivilized and filled with enemies.  Maybe there is a hint of Marxist class warfare in those remarks, as if our expectations of “good life” for both ourselves and our families (and kids when we have them) were not totally morally legitimate because there is sacrifice and need around us.  There may have been some practical justification for this idea in earlier pioneer times, when families were isolated and vulnerable on the frontier.  But we cannot live our lives as if we were pawns in a Hollywood “western” movie, or as if we were “the unforgiven”.  LaPierre would have every capable adult citizen deputized or part of his posse.  He would probably eventually advocate the idea that anyone who goes into teaching has to be capable of defending kids with weapons and his own body, a conscripted soldier.  He would indeed send our schools on a “Race to Nowhere” (Movies blog, Dec. 22).

LaPierre will be interviewed on NBC "Meet the Press" Sunday December 23.  

Saturday, December 22, 2012

Koshland Science Museum in DC (of NAS) addresses climate change, ought to address power grid stability

On Thursday, December 20, 2012 I visited the Marian Koshland Science Museum in the National Academy of Sciences Building, at 525 E St. NW Washington DC (link) about half way between the Gallery Place and Judiciary Square Metro Stations on the Red Line (one mile from Union Station).  I reviewed the short film “Climate Change: Lines of Evidence” on my movies blog Thursday.
The small museum does have major interactive exhibits called “Earth Lab” and “Life Lab”.

The “Earth Lab” does present a lot of evidence about climate change, as definitely being cause dby human activity.  It also presents some interim solutions, which will have consequences for many people.

The “Life Lab” has some panels about various stages of life, especially social, cognitive, and physical changes.  The panel on teenage years presents full physical maturity as occurring earlier (in men) than I think it actually does. The Life Lab also presents an interactive display regarding medications and preventive behaviors. 

I spoke to someone there (late Thursday, as no one else was around) and asked if there was any exhibit on space weather, solar storms (coronal mass ejections) and the stability of the power grid, both from solar instability and terror attacks.  That’s because the National Science Foundation has published two major books on the issues.  (See Books blog, Aug 9 and Nov. 15, 2012).  He was well aware of the issues and said privately that the country was on the precipice of a major catastrophe, which could happen with a big. 1859-style (“Carrington Event”) solar storm. We talked about the fact that the politicians and major media outlets are not discussing this issue very much (exception – Newt Gingrich). 
He mentioned that the Museum is looking for volunteers and needs people who can do at least one four-hour shift a week.  I will seriously look at this as 2013 begins and get back on it soon. 

Another question occurs to me with respect to climate change and power both. It has to do with tree trimming in residential areas.  If property owners had more responsibility for trees that fall during storms onto other people's property (than they usually do today), would that lead to massive tree cutting in suburbs, and could that reduce a significant biological resource to absorb carbon?

I'd put an embed from Ted (and the Huffington Post, and Phil Plait) Saturday on new technology to look for deadly asteroids and comets -- in time. The video is titled "How to Defend Earth from Asteroids". 

Friday, December 21, 2012

Extreme Right wing thinks all adults should be able to protect children with weapons; NRA speaks out, over protests

I’m rather perturbed by belligerent proposals from the “Right” that teachers and administrators should be armed. 

A few extreme proposals on Twitter even say that teachers should have to earn firearms licenses.  And a few letters and op-eds around say that adults (even non-parents), wherever they are, should always be able to protect children around them physically from enemies.  There is the rhetoric of belligerence and expectation of social breakdown and survivalism.

This is certainly a disturbing point for me, as I did experience discipline problems, particularly with special needs students, when I was a substitute teacher in a small minority of assignments, but the problems were severe enough for me to stop.

Governor Bob McDonnell (R) wants Virginia schools to allow teachers who want to be certified to carry guns (although he woudn't require it).  A similar proposal floats in Texas, and in one Wichita Falls, TX high school the principal and some teachers are armed.  

It would seem reasonable to me only to allow employers who have actually been deputized as police officers or security to carry weapons. It would seem appropriate to have uniformed armed police on campus, or sometimes to have properly qualified private security personnel -- maybe. 
Overseas, the general impression is that strict gun control reduces the incidence of mass events like what e have experienced. Others have pointed out that mass violence in both Australia and South Africa went down after strict control was implemented, including “character references”, qualification, and the possession of safes in homes.  But in South Africa, in the 1990s, homes with such caches often became targets of massed home invasions. 

The idea that adults have to watch other people’s children, sometimes with intensity, has come up in a completely different area, airline seating.  People who have paid for preferred seats sometimes fimd that their seats break up families, and the people wind up watching someone else’s kids on a flight.  This hasn’t happened to me. 

There’s one other point to make right now subsequent to Newtown.  Recently, in the Washington DC area (twice in Prince Georges County, once in the city itself), honor students have been gunned down walking to school or waiting for a school bus or by an intruder at home.  Two deaths have resulted.  None of these cases have been solved to my knowledge, despite the assurances from DC Police Chief Cathy Lanier that these incidents will not be tolerated.  This has been going on for a long time.  


The NRA press conferences is live now.  Wayne LaPierre blames the media for portraying violence and encouraging fantasy about violence as entertainment. The presentation has been disrupted twice already by protesters. 

He compared the security needs of schools to that of airports and banks. I would say, then, have uniformed police in schools.  Don't expect the teachers to be armed! It is true, that retired police could work in this area. 

After I typed the above, LaPierre called for every school in America to have armed police officer protection as soon as schools open in January 2013.  He said that Congress enact a "National Model School Shield Program", even before it solves the Fiscal Cliff! And it should to this before January 1!!

Thursday, December 20, 2012

Boehner's Plan B does seem initially harmless, but doesn't accomplish much

The Washington Examiner offers an editorial perspective Thursday December 20, 2012, p. 48, that Boehner’s “Plan B” is about as harmless (to conservatives and everyone else) as it gets.

It fixed the Alternative Minimum Tax thresholds (a highest priority for 2012 returns), prevents a middle class tax increase (well, not exactly – FICA will go up), and protects small businesses from estate taxes.  (Why not use the same carve-out idea on tax rates?  For small businesses and IRS code, it's all about "Chapter S".  But 85% of the wealthy have small businesses that would need a carve-out to protect jobs -- CNN.)  It seems pretty harmless in the short run, not stiffing anyone.
The editorial also expresses gloom that anything can be done about entitlements with Obama president, but I thought Obama himself was willing to talk about raising Medicare eligibility ages (gradually) and using a chained CPI for future social security benefits, at least. It sees, as thought it's the GOP that is punting on the cuts now.  No "4th and 29" play like the Baltimore Ravens pulled off recently, for the GOP now. 
The link is here.   It’s nice reading while eating a high protein breakfast in the cafeteria at the Virginia Hospital Center.

But the Editorial Board of Gannett’s USA Today says that there aren’t enough rich people to bail out the economy (no, not enough tech prodigies like Mark Zuckerberg or pop stars like Justin Bieber, or star quarterbacks or home run sluggers).  The middle class will really have to pay more.  And there aren’t enough new workers being raised by recent generations to keep paying off the baby boomers.  Paying FICA and Medicare taxes isn’t enough; you have to be able to have and raise children, too, to pay for your old age (and not just put if off for years of graduate or medical school).  The link is here.  “Don’t place the middle class off limits”.   The opposing view, “End Bush tax cuts for the wealthiest Americans” comes from Representative Sandy Levin (D-MI).   

Why do these two parties have to keep pointing fingers?  Why can't politicians do their jobs like ordinary people and take Christmas off?  (Some ordinary people don't get holidays off.) 

Update: Dec. 22

Boehner's plan was "too" innocuous.  He couldn't get the votes to bring it to the floor Thursday night.  

Monday, December 17, 2012

Gun ownership as a fundamental right; do ordinary citizens need personal weapons to protect themselves? Maybe most of the time, no. Piers Morgan "rants" on Twitter

Of course, in the past two days, there has occurred a liot of scattered debate on the right to bear arms, on the Second Amendment, on the fundamental right to defend property and life, and on the collective aspects of gun ownership issues.

One interesting point (whatever the Supreme Court and other courts have said on the “individual right” aspect of the 2nd Amendment) is that the relevance of the “right” has certainly changed since the Billof Rights was written.  In colonial times, the capability of government (in this context, the British) to arm itself against citizens was limited by available technology, and it made sense that communities could achieve some parity in defending themselves against a potentially tyrannical national or overseas government.  That makes no sense today in a world where governments have nuclear weapons, cruise missiles, and the like.

Piers Morgan, on CNN, has repeatedly compared US laws to Britain’s, and say that strict gun control will greatly reduce the number of mass incidents perpetrated by psychotic or psychopathic persons.  Perhaps that is true in Europe, where the risks are somewhat different (the danger from Al Qaeda is greater).  But gun control would not, for example, have prevented Oklahoma City.  (Piers Morgan tweeted about this incessantly all weekend.)

I agree (with Piers Morgan and others) that, for most people at least, there seems to be little or no legitimate reason to own assault weapons (Clinton’s ban ended in 2004) or to be able to buy weapons at gun shows without background checks.  And gun sales are said (by ABC News) to have increased since Obama’s re-election, maybe out of expectation that control will get tougher soon.

And the right-wing idea that people going to a movie theater or college campus should all carry arms seems ridiculous (Piers Morgan is right here).  I would hate to work as a substitute teacher at a school where teachers were expected to know how to defend students with firearms (another right wing idea). And GOP Virginia governor Bob McDonnell wants to consider arming teachers!  
Many ordinary citizens are probably better off owning no weapon at all.  In a home (in a populated area) that is well secured, a cell phone in the bed room (along with a home security system and good barriers) is probably all one needs.  That would seem to be true in better high rise buildings, too.

However, in many areas good perimeter and communications home security isn’t possible for residents.  I personally know of two cases in Washington DC where town  homeowners have stopped intruders or invasions with handguns ("pink pistols").  There is a case to be made for the idea that ordinary street crime might be deterred by more armed citizens, but the tradeoff is that more mass events could occur.  There are, of course, common sense measures for street security (mainly for visitors), such as walking mainly in populated areas, moving quickly, and keeping cell phones and electronics out of sight.

People who live in rural areas, and people who have decided that protecting their families from what they see as a likely economic and political or even infrastructure breakdown (like power grid attacks)  may believe that even moderate gun control infringes on their personal rights, as they see “rights” as very tied to their own ideas of family and machismo.   (They could argue that they need high-powered weapons to defend them against wild animals, too.)  These people may be the “Doomsday Preppers” but if more people were really prepared for breakdown, society might be more stable because of indirect deterrence. 

Gun ownership has always been a particular concern of the Libertarian Party, particularly in Virginia (as I recall a 1995 convention in Richmond).  Some people see capacity for self-defense as a ,moral duty.
The last time that I held a gun was in 1969, when I was in the Army, re-qualifying with the M-14 on the rifle range at Fort Eustis, VA.  I didn’t like the noise.  

Sunday, December 16, 2012

Can Congress fix the AMT retroactively in 2013?

The media this Sunday morning is sending very mixed messages on whether a meaningful deal can be reached before Jan1. 1 on the Fiscal Cliff.
Most of the changes that would take effect would apply to the 2013 tax year, and it is possible for Congress to fix these later.  But any such deal could run up against a debt ceiling in February.

But some people would stop getting unemployment benefits, and most wage earners would pay both higher FICA and higher withholding taxes, curbing spending power.  Financial markets would react, especially stocks (bonds might actually improve in some cases).  And some government contractors would face immediate layoffs.

But one particular item applies to the 2012 returns (and to the Estimated Tax payments that people in my situation must make), and that’s the Alternative Minimum Tax.  The AMT, despite rumors to the contrary, is incremental.  But because the thresholds would go back to 1993 levels, most of us would have to pay it.  My own bill would increase about $1500.   I would need to increase my Jan. 15 ETP to avoid penalty. 
There is some talk that Congress should fix the AMT thresholds separately, because they apply now to 2012 taxes.  But some in Congress want to see everybody in the same boat.  Everyone has his own way of getting stiffed.
Can Congress fix these problems retroactively?  The Los  Angeles Times suggests that even the AMT problem could be fixed in January or February, making a mess for the IRS and probably causing enormous delays in filing and processing returns, causing many extensions past April 15.  The IRS has already warned Congress (particularly speaker Boehner) about this.  The LA Times story by Jim Puzzanghera is here.

The Associated Press has a more general story in the Washington Post today, warning that most ordinary Americans don’t understand the seriousness of the AMT issue, here.

The Tax Foundation suggests that a retroactive AMT fix would not be possible, and warns that negotiators in Congress (including the Speaker) really don’t understand , at a sufficient intellectual level, the seriousness and consequences of the problem, here

In general, Congress has the power to act retroactively in tax issues, but this isn’t always a good thing.  Read what the Heritage Foundation says (2009) here.  I’ll have to come back to the details later.
On Sunday afternoon, CNN started reporting that Boehner may accept some limited tax rate increases on the rich, in exchange for a carve-out for small business.  But Boehner wants the increased rate to start only at $1 Million, and there seem to be serious disagreements on entitlements, still, and that's troubling. Stay tuned.  

Friday, December 14, 2012

Same-sex couple estate issues might help provide guidance for "carve outs" for small business in Fiscal Cliff tax negotiations

The attention to same-sex couples does motivate a possible path to compromise on the Fiscal Cliff issue.  No, equality for gay couples won’t have a significant effect on the federal deficit.
But there is an important concept that comes up for same-sex couples sometimes in estate planning, “Qualified Family-Owned Business Interest”, or “QFOBI”.  That relates to the idea that family wealth is often invested in running a closely held business, whether a farm, retail establishment, travel service, or anything similar, usually a local business in a local market. 

While it is probably appropriate to tax higher incomes at higher marginal rates when the income is used just for saving or personal consumption, there probably should be an allowance “carved out” for money that is plowed back into a business, even if closely held. 

It would take quite a bit of legal expertise for Congress to write the rules cleanly, but this should be done.
The topic is also covered on the LGBT blog today.

And, yes, given what happened today, we need to think very seriously about who buys weapons.  But that’s a topic for detail on another day.  

Wednesday, December 12, 2012

To GOP, Donkeys: Be specific on your cuts, revenues: GOP proposal today is far too vague!!

More posturing erupted Wednesday morning (December 12)  on the Fiscal Cliff. 

Republicans are saying they have sent up a reasonable plan to president Obama but have not been specific as to what they want.

The Wall Street Journal this morning has more details than anyone else (Damian Paletta, Janel Hook, Carol E. Lee), particularly about corporate taxes, link here

So here is what we need:

From Republicans, we need exact details as to spending cuts, and how much each measure would save. 

From Democrats, we need details as to how much each tax rate increase or deduction elimination would raise.

Many questions arise:

How much can be saved by gradually raising Medicare eligibility to age 67 over years?

How many more Medicare recipients need to pay higher premiums and how much does that raise?  (Right now, 5% do.)

How much can be saved by tweaking the Social Security COLA formula?

Let’s tell the truth about means testing.  Give details, by age and income, as to what benefit for today’s retirees and beneficiaries would match FICA contributions in an actuarial sense.  Hire an insurance company to do the “annuity” calculations with its Vantage system.  (Yup, my own employer was ING.  They know how to do it.)

How much can be pared safely from defense?

On Revenue:

How much will a marginal tax rate raise?  Give levels and numbers.

How much would letting all tax cuts expire raise?

How much would be raised by restoring full FICA payroll taxes? Until we restore them, it's common sense that we're getting deeper in the Social Security hole and getting tempted to raid current retirees.  

Is it possible to protect small business by “carve outs”, separating business income from personal income in family farms and small retail establishments?  That gets tricky as you eliminate deductions.  But be specific.  This could be the most difficult part of the calculation.

A high school teacher or college professor would tell the kids to be specific to answer these final exam questions.

Here is Boehner’s column on the Fiscal Cliff, Dec, 7, 2012.  It’s way too vague.  I’d give him a 50 on this essay.  Grading scale is 90-80-70-60.  

Tuesday, December 11, 2012

US will soon be world's largest oil producer, and then a net exporter, reversing the trend of the 1970s

The United States will become the world’s largest oil producer by 2017 (replacing Saudi Arabia and easily swamping countries like Venezuela and Nigeria), and a net oil exporter by 2030, according to a report issued by the International Energy Agency.

The report is titled the “World Energy Outlook 2012”, eight pages, and may be viewed here. It looks as though the IWA sells books on this matter giving more detail, and I’ll look more into this.

Elisabeth Rosenthal reported this in the New York Times on November 12, 2012, link here

That sounds like a boon for the economy (oil and gasoline prices) and for national security.  In the 1970s, independence from foreign oil became a big political goal (for Jimmy Carter) that was never fulfilled easily.
New technology, including fracking, shale, and deep recovery, made economically feasible when oil prices stay over about $80 a barrel, are offering the US its long sought energy independence, and seem to be putting off the days of reckoning for “peak oil”.

The main challenge may be producing and consuming the oil in an environment in which it is necessary to reduce carbon emissions into the atmosphere.
Future security problems could be more related to the climate issue (flooding in poor countries) availability of fuel itself.   Back in 1982, there was even a TV film that postulated that “World War III” could start on the Alaska pipeline.  Other security problems will relate to the security of the power grid itself – one of our most dangerous vulnerabilities. 

Monday, December 10, 2012

Has the GOP become anti-intellectual?

I had to notice well the op-ed in the New York Times Saturday December 8, 2012 by Charles M. Blow, “Dinosaurs and Denial”, on p. A19, link here

The writer discusses the apparent anti-intellectualism in some parts of the GOP (the less libertarian parts), and gets into a depiction of the creationism theme park opening in Kentucky.  He also produces a chart showing that 6% of scientists are Republican, and only 9% are conservative. Do scientists avoid “Prairie Home Companion”? Do they observe Labor Day?

Certainly, the behavior of the GOP during the 2011 debt crisis made no intellectual sense -- to suggest it was OK for the US to default on its legal obligations.  

But the real fun is with social issues.  It doesn’t make sense, to me, at least, to worry about the idea that some people don’t reproduce if you think that The Rapture (and Tribulations) is imminent anyway.  In fact, the Bible seemed to have its own contradictions on this matter, telling the Israelites to multiply and yet depicting the Apostle Paul as concerned about the rapid  nearing end at the time.  Not trying to have a family was almost a virtue for him, maybe for good reason.  

Notions about a “common good” and a “natural family” really might make some sense in the view of real science.  The evidence on climate change certainly points to a moral concern that people ought to believe they have their own personal skin in generations that will follow them.  Demography (longer life spans and fewer births in many social classes) and economic science (the growing entitlement-related deficit)  points to the idea that people will have to learn to take more “local” responsibility for one another in families.  All of these fit moral ideology in socially conservative portions of the GOP. 

Yet, “religiosity” or “churchianity” (the latter term is popular with the Rosicrucians) coaxes people into believing “that’s how things are” because of “God”.  Then, if things “change”, the world that rewarded their emotional commitments no longer makes sense to them.

Sunday, December 09, 2012

Right-to-work law about to pass in Michigan

A right-to-work law may be on the verge of passing in Michigan, home of the labor union, and the Republican governor Rick Snyder will sign it.

The law would prohibit employers from requiring union membership as a condition of employment, which unions in “union-friendly” states make them do as part of contracts.  Workers willing to work for lower wages could lowball union membersm(or even "scab").  Sometimes there have been issues with single employees working for less than employees raising families without two incomes.

The Huffington link for the story is here

Update: Dec 11

The Michigan legislature has passed the right to work law and the governor has signed it. 

Here is a Washington Post editorial "The Lansing-Beijing Connection", link.  Not sure that I follow it completely. 

Wednesday, December 05, 2012

Teachers union wants a national bar exam

On Dec. 2, the Washington Post ran a story that the American Federation of Teachers wants a nation professional bar exam for teachers.

And some teachers, including some “career switchers”, are weighing in already in the Post today, as with this teacher from Rockville, MD (wesbite url), here

There seems to be a suggestion that participants from “Teach for America” are not as well prepared as those originally trained to be teachers.

Having subbed myself in northern Virginia, it seems to me that people from the “real world” of work, including information technology and software development, as well as from performing arts like music, have something to offer, but only when they are working with students who left home with some motivation.  I used to tell students that their hour of working on a lesson plan project was  a preview of the real workplace they would see in a few years.  But that only worked at a certain level (honors, AP, IB, etc.)  True, sometimes students wanted to work “in groups”, but teamwork happens in the workplace (including Google and Facebook). 

In Virginia, there are university  licensure programs to give career switchers the required “180 clock hours” in a semester or less.  But most university education programs (like GWU) require more than that for an M.Ed. degree.  The availability of training may improve in northern Va as both George Washington and Virginia Tech set up new campuses, back-to-back, near Ballston in Arlington. 

Update: December 10

Check Randi Weingarten's piece "How about a bar exam for teachers" in the Monday Dec. 10 Wall Street Journal.  What a piece to read in a dentist's chair.  This idea would make a "career switch" after "forced retirement" from other fields of work even more problematical. 

Monday, December 03, 2012

Parties remain adamant about positions on Fiscal Cliff; proposals are still too vague

I was rather angry at hearing media reports about the interviews Sunday with both parties on the Fiscal Cliff.   Treasury Secretary Timothy Geithner said that a deal was not possible without marginal tax rate increases on the wealthy.  Period.  If the Republicans want the blame for everybody’s taxes going up, so be it. 

But Monday afternoon (December 3), the GOP offered a “plan” that at least sounds moderately encouraging.  The NBC News story by Luke Russert and Michael O’Brien is here.  The GOP still insists that revenues should be raised only by closing loopholes, and the Administration says that isn't enough. 

What seems apparent here is vagueness.  Even the Republicans are vague as to how the spending cuts would really work.  When they talk about entitlement cuts, I can’t be sure that they couldn’t be much more drastic than just raising the retirement age gradually and playing with COLA.  That’s what’s scary – the lack of specificity as to how people could be affected.  Still, it looks like the tone of the debate has softened a little today.  Maybe there will be some progress.

No one seems to talk about the way you protect the actual business component of a family farm or other small business operation from "consumption-based" income. 

And  why aren’t the parties talking about global warming, where it looks unlikely that the global temperature rise can be held to any specific level, and where the largest contributor to carbon emissions now is China.  The US carbon output has actually gone down. 

Saturday, December 01, 2012

Voters to Obama, Boehner on Fiscal Cliff: Don't stiff ME!

The liberal Washington Post has recently suggested that the additional revenues President Obama wants really can be achieved by limiting the total amount of deductions on the wealthy rather than raising margin rates to pre-Bush (Clinton) levels for higher earners. Time for "Sense and Sensibility".  

That sounds benign enough, the basis of a deal. Another obvious remedy is not to tax as income money put back into companies to employ people, or even to set up an “infrastructure bank” (as Fareed Zakaria suggests) and not tax money invested in it as much.

The key concern expressed by votes is “be gradual”.  That is, don’t stiff me.  “Don’t be evil.”  Enter the lobbyists.

It’s easy to imagine policy changes that cause sudden tax hikes, premium hikes, or loss of income to people in various circumstances, including seniors.

It’s obvious that cutting deductions could affect charities, or could affect homeowners, and home prices. 
It’s obvious too that some middle class people itemize deductions, so closing loopholes could hurt them if not done carefully.

The Democrats will have to get specific on cutting spending and entitlements.  Cutting spending will cause some people to lose their jobs (and get “stiffed” personally), but that would be especially true of Defense (and especially in Virginia).  Reforming entitlements can be done gradually. It makes sense to gradually raise retirement and eligibility ages over time.  It may make sense to enlarge the FICA and Medicare tax base.  Means testing gets dicier and maybe dangerous.  High earning seniors already pay more for Medicare (but only about 5% of them).  There’s a lot to be gained by reforming fee for service, reimbursement, and changing the incentive (as with tort reform) for unnecessary medical tests.  (I have to fight those off myself, as I noted in my main blog this morning.)

It seems like a no-brainer that the FICA tax holiday has to end, to support Social Security just as it is -- and that will hit people. And the end pf unemployment benefits will knock others to the streets.  When the GOP talks about taxes (under Grover Norquist's supervision), it generally just means income taxes.  
The most sensitive issues that could impact people suddenly is increasing estate taxes, and means testing social security benefits in a way not envisioned before, possibly rather quickly.

One thing that makes this a dud is for me is a recollection of how the radical Left hated inherited and even accumulated wealth when I was coming of age.  Indeed, it seemed then that the “Right” tried to justify the “inequalities of capitalism” by strict sexual morality.  Reducing the inheritance tax threshold could force surviving spouses to sell undervalued property to pay taxes, and move somewhere else. (This observation has been used in the gay marriage debate.)  So the survivor gets “stiffed”.  Worse, inheritance tax often causes individuals who inherit family businesses (sometimes farms, sometimes franchises) to have to sell them back to big companies to pay the taxes -- a legitimate concern of the GOP. 

There’s another twist to look for pockets to pick (or “stiff”).  It’s possible to look at tax returns for source of income – when there is a lot of investment income and little in the way of wages, that’s a sign of inherited or accumulated wealth – a target for moralistic Marxist expropriation.  Social Security already has the ability to look at these things now (it reviews federal tax returns to flag a small percentage of Medicare beneficiaries for higher premiums now.)  Imagine, then, that you don’t want to pay any Social Security benefits to anyone who doesn’t “need” them, because of income, accumulated wealth, inheritance, or even access to an estate trust.  You could make the case.  (People could say to me, give up your amateur journalism and go out and sell insurance like everybody else – and I’ve gotten unsolicited proposals just to do that, as if they were threats).  I could whine and say, the rug is ripped away from my life, my plans.  And others say, welcome to learning what it feels like merely to be unfortunate, unlucky.  Read the Bible.  Become a peasant.  Ring bells for the Salvation Army.

One oddity: it’s the conservative Heritage Foundation that promotes means testing of seniors.  Why?  Is it because they had their turn already?  Is all life precious?