Proudly, I was one of the founding members of the Chinese Historical Society of Southern California way back around 1975. And what began as gross roots movement by amateur historians has turned into a respected historical society with a number of original publications to its credit. The latest is a book called Portraits of Pride, Volume II, a $40 coffee table style book over almost 300 pages with biographical profiles of prominent Chinese Americans, mostly from the Los Angeles area. As with the predecessor book from 8 or 9 years ago, Portraits of Pride, thousands of copies of the book have been earmarked for donation to public libraries throughout the country.
Unfortunately, I have not had to time to actively participate in Society affairs during the past 30 years. Indeed, I hadn't had time to procure a copy of the new book, either at one of the monthly society meetings, or at the sporadically open society Heritage Center in Chinatown. So finally I decided that my best bet to buy the book would be through Amazon.com. But strangely, while Amazon carried the first volume, it didn't seem to stock the new, second version. However after doing some digging, I found that while they had no new copies of the book, they had a large number of used copies, which seemed a little odd. Upon closer examination, I also saw a number of the used copies were marked "like new" and even "in original shrink wrap." So I purchased the latter copy for $7.50. The seller was listed as the Morgan Hill (CA) public library. So that's what libraries do with donated books!
Monday, March 25, 2013
Sunday, March 17, 2013
Fuzzy Math In Washington D.C.
While everybody knows Washington D.C. is the capital of the United States, few realize that Washington D.C. is also the capital of fuzzy math, particularly as practiced by that city's politicians. A couple of tax proposals introduced by our Congressional representatives this past month are stark indicators of how the numbers work in Washington D.C.
Perhaps the most mind numbing example of the practice of fuzzy math is the Democratic proposal to delay the sequester for the rest of the year. The cost of the sequester delay was $100 billion, to be split between alternate spending cuts of $50 billion and tax increases of $50 billion. The announcement from the bill's authors proudly proclaimed that the $50 billion tax increase would be funded almost entirely by implementing the Buffett rule, which would take taxpayers whose income is largely taxed at 15 percent due to high concentrations of dividend income and capital gains, and subject them to a 30 per cent tax rate. This sounds like a neat and easy method of putting the burden of the sequester delay on the very few super rich. And aside from the "no tax increase, nowhere on nobody" purists, this might sound like a reasonable solution. Except for the fact that the Buffett rule in fact affects very few taxpayers. While it makes wonderful news headlines, there are not very many Warren Buffetts or Mitt Romneys who pay such a low overall tax rate. In fact, there are so few of them that would be affected by the passage of a Buffett rule, that enactment of the Buffett rule would only raise a paltry $5 billion a year in tax revenues. So how do they come up with $50 billion in revenues from this proposal? Why by counting ten years worth of Buffett rule revenues in their equation. Yep. Only in Washington can you balance the budget by offsetting one year (well, really ten months) worth of spending cuts against ten years of revenue increases.
The other example of fuzzy math is a proposal by Senator Levin of Michigan to close a tax loophole that doesn't exist. Now in Washington D.C., politicians generally stay clear of raising tax rates, but have no qualms about closing "tax loopholes", even though most of those "loopholes" were consciously enacted by Congress to encourage selected economic behavior. For example, dollarwise the biggest corporate tax "loophole" allows an accelerated depreciation writeoff of plant and equipment, which was specifically designed by Congress to encourage businesses to buy more plant and equipment. Other loopholes encourage alternative energy sources, such as ethanol or wind energy. In any event, the object of closing a tax loophole is to raise government revenues. The loophole that the good senator wants to close is the one that permits corporations to take a bigger tax deduction for stock options granted to employees than the deduction which is allowed in computing the company's earnings reported to shareholders. Again, this sounds like a potentially reasonable way to increase tax revenues. Except that when an employer gets a tax deduction for stock options, there is a equal and corresponding amount of compensation income recognized by the employee for tax purposes. In other words, closing this tax loophole raises zero dollars in revenues for the government. Or as Billy Preston said, nothin from nothin leaves nothin.
So when the talking robot in "Lost In Space" said "that does not compute" we know it was talking about our politicians in Washington D.C. I'm thinking we should take all our politicians and spay and neuter them so they won't beget any more.
Perhaps the most mind numbing example of the practice of fuzzy math is the Democratic proposal to delay the sequester for the rest of the year. The cost of the sequester delay was $100 billion, to be split between alternate spending cuts of $50 billion and tax increases of $50 billion. The announcement from the bill's authors proudly proclaimed that the $50 billion tax increase would be funded almost entirely by implementing the Buffett rule, which would take taxpayers whose income is largely taxed at 15 percent due to high concentrations of dividend income and capital gains, and subject them to a 30 per cent tax rate. This sounds like a neat and easy method of putting the burden of the sequester delay on the very few super rich. And aside from the "no tax increase, nowhere on nobody" purists, this might sound like a reasonable solution. Except for the fact that the Buffett rule in fact affects very few taxpayers. While it makes wonderful news headlines, there are not very many Warren Buffetts or Mitt Romneys who pay such a low overall tax rate. In fact, there are so few of them that would be affected by the passage of a Buffett rule, that enactment of the Buffett rule would only raise a paltry $5 billion a year in tax revenues. So how do they come up with $50 billion in revenues from this proposal? Why by counting ten years worth of Buffett rule revenues in their equation. Yep. Only in Washington can you balance the budget by offsetting one year (well, really ten months) worth of spending cuts against ten years of revenue increases.
The other example of fuzzy math is a proposal by Senator Levin of Michigan to close a tax loophole that doesn't exist. Now in Washington D.C., politicians generally stay clear of raising tax rates, but have no qualms about closing "tax loopholes", even though most of those "loopholes" were consciously enacted by Congress to encourage selected economic behavior. For example, dollarwise the biggest corporate tax "loophole" allows an accelerated depreciation writeoff of plant and equipment, which was specifically designed by Congress to encourage businesses to buy more plant and equipment. Other loopholes encourage alternative energy sources, such as ethanol or wind energy. In any event, the object of closing a tax loophole is to raise government revenues. The loophole that the good senator wants to close is the one that permits corporations to take a bigger tax deduction for stock options granted to employees than the deduction which is allowed in computing the company's earnings reported to shareholders. Again, this sounds like a potentially reasonable way to increase tax revenues. Except that when an employer gets a tax deduction for stock options, there is a equal and corresponding amount of compensation income recognized by the employee for tax purposes. In other words, closing this tax loophole raises zero dollars in revenues for the government. Or as Billy Preston said, nothin from nothin leaves nothin.
So when the talking robot in "Lost In Space" said "that does not compute" we know it was talking about our politicians in Washington D.C. I'm thinking we should take all our politicians and spay and neuter them so they won't beget any more.
Subscribe to:
Posts (Atom)