22. November 2009 · Comments Off on Imperfect Systems · Categories: Economics, Politics · Tags: , ,

A fundamental basis of capitalism is that it’s balanced on the dollar which is naturally reconciled with basic numbers. But humanity is far more complicated and there is nothing natural about reducing it to numbers. Humanity requires judgment. So as long as capitalism drives everything to the ends, conflicts with humanity can only be expected.  Socialism, which is balanced on judgment, might seem like a far better idea but is plagued with the problem that people, though capable of judgment, often suck at it.

29. October 2008 · Comments Off on Joe the Plumber, Can you be any Dumber? · Categories: Politics · Tags: ,

(a pretend letter to Joe the Plumber)

Joe, I can understand why McCain and Palin are so eager to stoke your fallacy equating the Obama tax plan to socialism; because fallacies, no matter how looney, sway votes… But notice how they handle it? It’s a “Joe-said-it” fallacy. They don’t want to take responsibility for initiating such a wild misconception but they love it that you did. They’re capitalizing on your ignorance Joe. What? You don’t see what wrong with what you said? Here, let me break it down for you.

Is Obama’s tax plan a form of socialism?

First of all, socialism is defined by the public ownership of production and distribution of goods… Nothing in Obama’s tax plan suggests public ownership of anything. If you want to talk about socialism you need to find examples of where the government actually owns the means of production or distribution of goods… The Pentagon for instance, a tax-funded, government agency that controls the distribution of defense-related products. Technically, THAT’S socialism.

Oh, you don’t think so? Well, no big surprise there. Despite staunch conservative support for certain government operations that take the form of socialism, the word “socialism” itself is simultaneously promoted by conservative rhetoric as a derogatory term, most frequently used to describe their liberal opponents. This leads many conservatives to the false conclusion that the very socialist features that they actually support can’t possibly be socialist for the simple reason that conservatives hate socialism. It amazes me how that social conditioning actually works.

Look, all the Obama tax plan is suggesting is that the government get more of it’s revenue from higher brackets, that’s not socialism, that’s just taxes. Granted, shifting the tax burden up the brackets does screw with trickle-down capitalism but capitalism is capitalism whether you push the money in through the top or push the money in through the bottom, it’s still the same American free-enterprise market.

Conservatives have been pushing the tax-burden down the brackets to feed cash into the top for decades. On a fundamental level the strategy is the same, like turning left or right using the same steering wheel, the most dramatic difference being that conservatives tend to borrow more so they can tell their faithful flock that through the magic of “fiscal responsibility” they don’t have to pay for their increased government spending… as if the mounting debt won’t ever become a problem. And sure enough it did… The big fat lie – “you can get something for nothing” was propagated by the mortgage industry to lure in capital debt AND by the Republican party to lure in political support.

And Joe, Get over yourself, the government isn’t there to reward your success like some kind of girl scout club handing out merit badges. The plain simple fact is that government spends money and that money has to come from somewhere. What’s that? The government should stop spending money then? Well, that would certainly eliminate the need for taxes. But for all the “opposition” to government spending, conservative politics have only increased government spending. Here’s some fiscal responsibility for ya Joe, cut spending first THEN cut taxes. Until then, we have to tax, even if we borrow we still have to pay the debt off with… taxes. So why tax the higher brackets? Well, the higher brackets happen to be where the money is. And don’t give
me that Rush Limbaugh crap about how unfair it is for the top 50% to pay for 90% of the taxes. Rush used cumulative percentages that hid the fact that it’s only the top 5% making more than $130K that actually pay more than a fair share. The rest of that top half actually pays less than their fair share and as for that top 5% they have more than enough wealth to offset the tax burden, something the bottom 90% doesn’t have. In fact when you include capital income from capital gains, dividends, interest, and rents, in other words, income generated by wealth, the top 1% actually earns more than 57% of the total, far less than their 34% share of total tax.

They’re playing with your head Joe.

And don’t EVEN give me that crap that people won’t have any incentive to work hard just because higher incomes mean higher taxes. The American dream isn’t all about taxes, it’s about houses, cars, education for the kids and everything else that goes with higher incomes, even if taxes come with it. Do you see anyone saying they don’t want to win the lottery because they would have to pay tax on it? Get real; even half of a hard-earned dollar is better than a handout quarter.

So it’s totally not socialism Joe, and it’s nothing personal either, so get over yourself, grow up, concentrate on how to offset the cost of a three point tax increase on income over $250K… a worthy business leader would know what to do. It would be the same challenge created by market driven inflation and sudden drops in sales. If you own a successful business you should work smarter not harder and if you can’t then you shouldn’t buy that business, you’ll wind up putting all your employees out of a job and I’m sure when that happens you’ll be blaming the government for taxing you too much instead of blaming yourself for not being able to steer a company through economic challenges.

Maybe you just stick to fixing pipes and let someone else with a brain run the business. You’ll be better off.

22. February 2005 · Comments Off on …Meanwhile at Boeing · Categories: Economics, Politics, Technology · Tags: , , ,

My last entry was a slam on Wall Street journalist Holman Jenkins for whining about how Airbus gets help from the governments of countries in which Airbus designs, builds and employs. My point was simple, Airbus and the Europeans have a symbiotic relationship that obviously works well for them. It seemed Holman was crying like a baby because he thought Airbus had an unfair advantage over Boeing. But let’s stop crying for a moment and look at what Boeing is doing… it’s not a dismal story. The big news for Boeing is the new 787. This design is breaking all kinds of barriers that leads to the most environmentally safe aircraft ever. The advanced engine design, new composite materials and aerodynamics all come together to provide a 20% increase in fuel efficiency and a projected 10% decrease in operating cost. The aircraft will also be quieter while emissions such as carbon dioxide and nitrogen dioxide have decreased significantly. I travel all too often, so what I also consider great news is the effort Boeing is making to provide a better experience for passengers, including bigger windows, better acoustics, wider seats, wider isles, bigger overhead bins… The list goes on. It’s all good. I can’t wait for airlines to start replacing those awful 737’s with these babies.

So forget those stuffy Wall Street belligerents that can’t see past their politics… Who cares if Airbus gets government help? Boeing seems to be doing just fine – in fact that European tax money that flowed through Airbus and into the European sub-contracts for research and development may have turned into a benefit for Boeing anyway. Rolls-Royce in England for example, who makes the engines for the A380 is working with GE to develop the revolutionary engines for the 787 while Dassault in France provides the cutting-edge digital modeling systems for the super-computers that allow Boeing to break so many engineering barriers, even right down to the British pumps and values and French wiring the 787 is truly a global effort. It seems American and European engineers are working hand in hand to build the machines of the 21st century, the whiny bean counters in Wall Street just got to get over their stupid hang-ups.

Boeing 787 Dreamliner

10. February 2005 · Comments Off on Whining about Airbus · Categories: Economics, Politics · Tags: , , , ,

Holman Jenkins expressed in the Feb 9, 2005 issue of the Wall Street Journal an opinion about Airbus that I’ve been noticing a lot lately. It seems the roll out of the new A380 double-decker jumbo jet has many anti-Europeans all tied up in a knot. Jenkins sets the mood of his temper tantrum by asking the question… “What has Europe got for $15 billion in taxpayer handouts over three decades, besides a fetish object that politicians can fawn over to distract attention from their economic failures?” It seems that answer

is fairly obvious… a larger sales value than any other commercial aircraft manufacturer in the world, including Boeing. Not that Jenkins was really asking for an answer, he quickly dismisses the question and rolls into what he calls “today’s topical question”… “Are Airbus executives – who have the potential  

to be world-class, even if their home economies aren’t – out of their minds?” But even this question seems to be more of a rhetorical stab than anything else, maybe he just needed to vent a little bit before getting down to the nuts and bolts of his actual problem.

Yes, that’s right… HIS problem. The contents of his compliant form reveals the real nature of what he has to say. In simple words, he is miffed that Airbus is relying on government subsidies. But how is that a problem for Airbus? And since most of the Europeans don’t seem to mind paying for it then how is that a problem for them? In general, Europeans take more vacations overseas than American do, maybe they actually like the idea of Airbus rolling out a luxurious aircraft for the ride, maybe there is some value in the pride they have in such trophies of European engineering. That may seem like a hard concept to wrap our pragmatic American minds around but think for a moment about how our tune changes when we see the Thunderbirds ripping through the skies above the football stadium in their F-16’s. We don’t seem to have a problem spending our taxes on military contracts do we? Oh, that’s different, I know. The military expenses are keeping the world safe… It’s always different. I don’t need to argue the differences between what people think is important to spend money on, my point is simple… people are willing to spend taxes on what they think is important to them, and if we were less than hypocritical, we would understand that freedom includes the right for people to make that decision for themselves. But ironically, the Bush administration,

  so-called champions of democracy, can’t seem to accept this. Right now they are demanding a roll-back of a 1992 agreement that tolerates government subsidies as long as they are limited to 33% of the launch cost of a new aircraft. So much for free-will. Jenkins wraps up his gripe-session with the challenge that Airbus executives

should “show some class” by spurning further direct handouts in competition with Boeing. He says… “it’s the disciplined way to run a business that deserves the confidence of investors.” I guess he thinks that private capital is the only respectable way to get funded. That doesn’t say much for our military contractors. And really, if you think about it, it’s a sad world that relies on private capital for everything anyway, because private capital takes the wonders of science and engineering away from the realms of human capacity and ties it down to the servitude of bean-counters.