Kilroy Was Here
January 27, 2003
Why I Am A Liberal: Part 2 - The Political Compass
The Blahblogger recommended to me that I take a look at a website called The Political Compass. This website invites you to rate how you feel about certain propositions in order to see where you fit on 2 dimensional grid mapping out differing political positions. Interestingly enough, I took this test and found myself to be far down in the Libertarian Left quadrant.

Good for me, because out of all the people on the axis to the right here, I like Ghandi the best.

However, it's interesting that the US Congress has tended to remain polarized along one axis. Consider the following from Dr. Kenneth Poole of the University of Houston:

Perhaps this means that American government is relatively stable along the Authoritarian axis, but moves quite dramatically along the Economic axis. Also, perhaps race is a third dimension in this particular analysis.

I wonder if the Political Compass group can include some questions to measure the tolerance for diversity vs. overt racism in their analysis.
What Bush Should Propose in the State of the Union
Tonight, President Bush's State of the Union will role out some of the same tired, small-minded policy ploys aimed more at achieving tactical political goals than true social change. You'll hear about the War on Terror and the War on Iraq. And if Condi Rice's opinion piece in the NY Times is any indicator, Bush's State of the Union will be long on rhetoric and short on evidence.

You'll hear about prescription drugs for seniors (but only if they opt out of Medicare and into an HMO), and faith-based initiatives, a a "ploy," David Frum admits in his book The Right Man, designed mainly "to unite conservative evangelicals, urban Catholics, Minority pastors and traditional noblesse oblige Republicans."

But, in the interest of improving our political system for all, here are a few great political ideas that you won't hear about tonight.

But you should.

The 21st Century Homestead Act

In the Atlantic, Ray Boshara re-proposes a great idea--provide every one of the four million babies born in America each year an endowment of $6,000 in an American Stakeholder Account. According to Boshara:

There are several good reasons why a Republican President should propose such a policy program:

Real Election Reform
As a man who holds office under the cloud of Bush v. Gore, the President could and should do more to really improve elections in America. Campaign finance reform may be difficult (and unconstitutional) but improving our current elections need not be. Here are just two proposals:

The good thing about this type of reform is that it's safely within constitutional borders, and, more importantly, it can blunt some of the more pernicious evils of our electoral process. Campaign financing will have less of an impact, because voters will feel safer to go with third party candidates. Lobbyists will have less of an impact because congressional seats won't be as safe and representatives who wish to remain in office will have to pay more attention to their constituents. Congress will get more things done since competitive seats won't harbor the ideologues as much as the pragmatists.

These are just two real proposals that President Bush could propose that would have real meaning and effect for the people of our country. Not to mention the things our government should do to insure access to health care for all Americans, economic stimulus, and corporate corruption.

But let's just take small steps in places where we all could agree.

January 21, 2003
College Exams Are Killing Grandmothers!
It has recently been brought to my attention that college exams are killing grandmothers! According to a detailed study at Eastern Connecticut State University, Mike Adams has discovered that a "student's grandmother is far more likely to die suddenly just before the student takes an exam, than at any other time of the year."

Furthermore, the lower a student's current grade, the more likely an exam is to induce death. According to Adams, only one conclusion can be drawn:

Obviously, we must quickly implement solutions to stop this epidemic of grandmother deaths. Three possible policies proposed by Adams:

  1. Stop giving exams.
  2. Allow only orphans to enroll at university.
  3. Have students lie to their families. Students must pretend they are in the armed forces, have joined some religious cult, or have been kidnapped by aliens. All of these alternate explanations for their long absences will keep the family ignorant of the true, dangerous, fact.

Write your congressman, today!
January 20, 2003
Why Am I A Liberal - Part 1: Why Ask The Question
I have always been a liberal and a Democrat. I still remember my 12 year-old self arguing to elect Jimmy Carter over Ronald Reagan. I've always been anti-death penalty and pro-choice. I couldn't turn on CNN for 6 months after the 2000 election.

But after the mid-term elections of 2002, I was faced with a country that had installed for a majority conservative Congress, a conservative President, and a conservative Supreme Court. And a troubling thought began to form on the edge of my brain.

Maybe I'm wrong.

Conservatism is everywhere triumphant. In our government, in our news media, in our discourse, the Right holds the upper hand over a besieged, moribund, gray-colored Left.

As of this posting, the #1 best-selling book on's Non-Fiction List is The Savage Nation: Saving America from the Liberal Assault on Our Borders, Language and Culture. Let Freedom Ring: Winning the War of Liberty over Liberalism is #9. #23 is Slander: Liberal Lies About the American Right.

The #1 Cable News Channel is the conservative leaning Fox News. The number one radio program is Rush Limbaugh. The most popular blogs, the right leaning Instapundit and Andrew Sullivan.

And conservatism sway is not just ascending in the media. People are more likely to identify themselves as conservatives in all income levels. According to the National Election Service, in the year 2000 saw the following percentages of identification for conservatives and liberals.



What's most surprising about these stats is that even the poorest Americans, the ones that us liberals are fighting the most for, identify themselves as conservatives nearly twice as often as liberals.

So in the face of rising conservatism, I have to ask the question: Why be a liberal? Why be pro-choice and anti-capital punishment? Why support a progressive tax structure rather than a flat tax? Why be skeptical about our countries current faith in markets? Why fight for affirmative action? Why prefer government over corporations?

When the majority of your country disagrees with your views, you have to consider the fact that they are right, and you are wrong. It's not necessarily so, but it has to be investigated.

So, I will have this internal debate in public view. I'll consider the differences between the conservative movement and the liberal movement. I'll attempt to then apply those differences to the major issues facing our country today. In the end, I hope to root my liberal leanings deeply in logic from a basic set of moral precepts. In the end, I suspect I'll be even more deeply liberal than I am now.

You may wonder how I can make this claim if I am to remain truly open to the debate. And you are right; I have started this debate with a liberal bias.

You see, I am bothering to ask the question.

January 14, 2003
Washington Post on Iraq Decision
A few posts ago, I posited a theory on why the Administration desired to invade Iraq. Here's the Washington Post's take on the decision.

U.S. Decision On Iraq Has Puzzling Past

Opponents of War Wonder When, How Policy Was Set

By Glenn Kessler

Washington Post Staff Writer

Sunday, January 12, 2003; Page A01

On Sept. 17, 2001, six days after the attacks on the World Trade Center and the Pentagon, President Bush signed a 2½-page document marked "TOP SECRET" that outlined the plan for going to war in Afghanistan as part of a global campaign against terrorism.

Almost as a footnote, the document also directed the Pentagon to begin planning military options for an invasion of Iraq, senior administration officials said.

The previously undisclosed Iraq directive is characteristic of an internal decision-making process that has been obscured from public view. Over the next nine months, the administration would make Iraq the central focus of its war on terrorism without producing a rich paper trail or record of key meetings and events leading to a formal decision to act against President Saddam Hussein, according to a review of administration decision-making based on interviews with more than 20 participants.

Instead, participants said, the decision to confront Hussein at this time emerged in an ad hoc fashion. Often, the process circumvented traditional policymaking channels as longtime advocates of ousting Hussein pushed Iraq to the top of the agenda by connecting their cause to the war on terrorism.

With the nation possibly on the brink of war, the result of this murky process continues to reverberate today: tepid support for military action at the State Department, muted concern in the military ranks of the Pentagon and general confusion among relatively senior officials -- and the public -- about how or even when the policy was decided.

The decision to confront Iraq was in many ways a victory for a small group of conservatives who, at the start of the administration, found themselves outnumbered by more moderate voices in the military and the foreign policy bureaucracy. Their tough line on Iraq before Sept. 11, 2001, was embraced quickly by President Bush and Vice President Cheney after the attacks. But that shift was not communicated to opponents of military action until months later, when the internal battle was already decided.

By the time the policy was set, opponents were left arguing over the tactics -- such as whether to go to the United Nations -- without clearly understanding how the decision was reached in the first place. "It simply snuck up on us," a senior State Department official said.

The administration has embarked on something "quite extraordinary in American history, a preventive war, and the threshold for justification should be extraordinarily high," said G. John Ikenberry, an international relations professor at Georgetown University. But "the external presentation and the justification for it really seems to be lacking," he said. "The external presentation appears to mirror the internal decision-making quite a bit."

Advocates for military action against Iraq say the process may appear mysterious only because the answer was so self-evident. They believe that Bush understood instantly after Sept. 11 that Iraq would be the next major step in the global war against terrorism, and that he made up his mind within days, if not hours, of that fateful day. "The most important thing is that the president's position changed after 9/11," said a senior official who pushed hard for action.

"Saddam Must Go"

A small group of senior officials, especially in the Pentagon and the vice president's office, have long been concerned about Hussein, and urged his ouster in articles and open letters years before Bush became president.

Five years ago, the Dec. 1 issue of the Weekly Standard, a conservative magazine, headlined its cover with a bold directive: "Saddam Must Go: A How-to Guide." Two of the articles were written by current administration officials, including the lead one, by Zalmay M. Khalilzad, now special White House envoy to the Iraqi opposition, and Paul D. Wolfowitz, now deputy defense secretary.

"We will have to confront him sooner or later -- and sooner would be better," Khalilzad and Wolfowitz wrote. They called for "sustained attacks on the elite military units and security forces that are the main pillar of Saddam's terror-based regime."

In an open letter to President Bill Clinton in early 1998, Wolfowitz, Khalilzad and eight other people who now hold positions in the Bush administration -- including Defense Secretary Donald H. Rumsfeld -- urged Clinton to begin "implementing a strategy for removing Saddam's regime from power."

Many advocates of action were skeptical that Hussein could be contained indefinitely, even by repeated weapons inspections, and they viewed his control of Iraq -- and his possible acquisition of weapons of mass destruction -- as inherently destabilizing in the region. Many were also strong supporters of Israel, and they saw ousting Hussein as key to changing the political dynamic of the entire Middle East.

During the 2000 presidential campaign, Bush and Cheney's position was not as clear-cut.

In an interview on NBC's "Meet the Press," about one year before the Sept. 11 attacks, Cheney defended the decision of George H.W. Bush's administration not to attack Baghdad because, he said, the United States should not act as though "we were an imperialist power, willy-nilly moving into capitals in that part of the world, taking down governments." In the current environment, he said, "we want to maintain our current posture vis-à-vis Iraq."

Bush, during the campaign, focused more on the dangers of nuclear proliferation than on the removal of Saddam Hussein. In a December 1999 debate among GOP presidential contenders, Bush backtracked when he said he'd "take 'em out" if Hussein had weapons of mass destruction. Asked by the moderator whether he had said "take him out," Bush replied, "Take out the weapons of mass destruction."

"Transformed by Sept. 11"

In the early months of the Bush administration, officials intent on challenging Hussein sought to put Iraq near the top of the administration's foreign policy agenda. Many felt frustrated by the interagency debate. Defense officials seethed as the State Department pressed ahead with a plan to impose "smart sanctions" on Iraq and, in their view, threw bureaucratic roadblocks in the way of providing funds to the Iraqi opposition.

"Even relatively easy decisions were always thrown up to the presidential level," said a Defense official.

Meanwhile, at the White House, officials worked on refining the administration's Iraq policy, focusing especially on how to implement the official U.S. stance of "regime change" articulated by the Clinton administration. Bush was informed of the deliberations, but nothing had been settled when the terrorists attacked the Pentagon and World Trade Center.

"Certainly, different people at different times were arguing for a more vigorous approach to Saddam," one senior official said. "But nobody suggested that we have the U.S. military go to Baghdad. That was transformed by Sept. 11."

Iraq, and its possible possession of weapons of mass destruction, was on the minds of several key officials as they struggled to grapple with the aftermath of Sept. 11. Cheney, as he watched the World Trade Center towers collapse while he was sitting in front of a television in the White House's underground bunker, turned to an aide and remarked, "As unfathomable as this was, it could have been so much worse if they had weapons of mass destruction."

The same thought occurred to other senior officials in the days that followed. Rumsfeld wondered to aides whether Hussein had a role in the attacks. Wolfowitz, in public and private conversations, was an especially forceful advocate for tackling Iraq at the same time as Osama bin Laden. And within days, national security adviser Condoleezza Rice also privately began to counsel the president that he needed to go after all rogue nations harboring weapons of mass destruction.

But these concerns were submerged by the imperative of dealing first with Afghanistan. "I remember the day that we put the map on the table, and the color drained from everybody's face," one official said. "Afghanistan is not the place you would choose to fight."

The Pentagon, while it was fighting the war in Afghanistan, began reviewing its plans for Iraq because of the secret presidential directive on Sept. 17. On Sept. 19 and 20, an advisory group known as the Defense Policy Board met at the Pentagon -- with Rumsfeld in attendance -- and animatedly discussed the importance of ousting Hussein.

The anthrax attacks, which came soon after Sept. 11, further strengthened the resolve of some key administration officials to deal with Iraq. Cheney, in particular, became consumed with the possibility that Iraq or other countries could distribute biological or chemical weapons to terrorists, officials said.

Though Cheney's aides said the vice president has been consistently concerned about Iraq and weapons of mass destruction, others perceived a shift. "To his credit, he looked at the situation differently after Sept. 11 than he did before," one senior official said.

Because the culprit behind the anthrax attacks has not been found, some administration officials still are convinced that Hussein had a role in the anthrax attacks. "It's hard to get away from the feeling that the timing was too much of a coincidence," one official said.

Officials close to the president portray the Iraq decision as a natural outgrowth of concerns Bush raised during the presidential campaign, and they say he very quickly decided he needed to challenge Iraq after the terrorist attacks.

But he didn't publicly raise it earlier because, in the words of one senior official, "he didn't think the country could handle the shock of 9/11 and a lot of talk about dealing with states that had weapons of mass destruction."

"What a Fixation"

In free-wheeling meetings of the "principals" during October and November, Rumsfeld and Cheney emphasized their suspicions of ties between rogue states, such as Iraq, and terrorists. Some of the conversations were prompted by intelligence, later discounted, that al Qaeda may have been on the verge of obtaining a "dirty bomb" that would spread radioactive material.

By early November, Wayne Downing, a retired Army general who headed counterterrorism in the White House, on his own initiative began working up plans for an attack of Iraq, keeping his superiors informed of his progress. A Pentagon planning group also kept hard at work on possible options.

"The issue got away from the president," said a senior official who attended discussions in the White House. "He wasn't controlling the tone or the direction" and was influenced by people who "painted him into a corner because Iraq was an albatross around their necks."

After some of these meetings at the White House, Secretary of State Colin L. Powell, skeptical of military action without the necessary diplomatic groundwork, would return to his office on the seventh floor of the State Department, roll his eyes and say, "Jeez, what a fixation about Iraq," State Department officials said.

"I do believe certain people have grown theological about this," said another administration official who opposed focusing so intently on Iraq. "It's almost a religion -- that it will be the end of our society if we don't take action now."

"Axis of Evil"

Much of this activity -- and these concerns -- were hidden from the public eye. Bush barely mentioned Iraq in his address to the nation nine days after the Sept. 11 attacks. In fact, the administration did not publicly tip its hand until Bush made his State of the Union address on Jan. 28, 2002. Even then, officials did their best to obscure the meaning of Bush's words.

Listing Iraq, Iran and North Korea, Bush declared, "States like these, and their terrorist allies, constitute an axis of evil, arming to threaten the peace of the world. By seeking weapons of mass destruction, these regimes pose a grave and growing danger. They could provide these arms to terrorists, giving them the means to match their hatred."

"I will not wait on events, while dangers gather," Bush warned.

State Department officials puzzled over drafts of the speech and ultimately concluded the words did not represent a policy shift, though some were worried the rhetoric would have diplomatic consequences. Powell "thought it rang an alarm bell since it would send waves out there to colleagues around the world," a State Department official said.

Powell expressed concerns about the language to the White House, he said. "But he didn't push it hard."

Briefing reporters at the White House, officials played down the importance of the "axis of evil." One senior White House official advised "not to read anything into any [country] name in terms of the next phase" of the war against terrorism. "We've always said there are a number of elements of national power" in the U.S. arsenal, the aide added, including diplomacy and sanctions. "This is not a call to use a specific element" of that power.

Yet, in this period, Bush also secretly signed an intelligence order, expanding on a previous presidential finding, that directed the CIA to undertake a comprehensive, covert program to topple Hussein, including authority to use lethal force to capture the Iraqi president.

Speculation continued to run high in the media that an attack on Iraq was imminent. But within the administration, some of the advocates were becoming depressed about the lack of action, complaining that it was difficult to focus attention on Iraq, especially as the conflict between the Israelis and Palestinians spiraled out of control. In March, Cheney toured the Middle East on a trip dominated by questions from Arab leaders about the Israeli-Palestinian violence. But he also stressed the administration's contention that Iraq was a problem that needed to be addressed.

"I Made Up My Mind"

Then, in April, Bush approached Rice. It was time to figure out "what we are doing about Iraq," he told her, setting in motion a series of meetings by the principals and their deputies. "I made up my mind that Saddam needs to go," Bush hinted to a British reporter at the time. "That's about all I'm willing to share with you."

At the meetings, senior officials examined new but unconfirmed evidence of Iraq's programs to build biological, chemical and nuclear weapons and considered connections between Baghdad and Palestinian terrorism. They argued over which elements of the Iraqi opposition to back, ultimately deciding to push for unity among the exiles and within the U.S. bureaucracy.

By many accounts, they did not deal with the hard question of whether there should be a confrontation with Iraq. "Most of the internal debate in the administration has really been about tactics," an official said.

Powell sent his deputy, Richard L. Armitage, who had signed the letter to Clinton urging Hussein's ouster, to many of the meetings. As a way of establishing Powell's bona fides with those eager for action, Armitage would boast -- incorrectly, as it turned out -- that Powell first backed "regime change" in his confirmation hearings.

Serious military planning also began in earnest in the spring. Every three or four weeks, Army Gen. Tommy R. Franks, commander of U.S. Central Command, would travel to the White House to give Bush a private briefing on the war planning for Iraq.

On June 1, Bush made another speech, this time at West Point, arguing for a policy of preemption against potential threats. "If we wait for the threats to fully materialize, we will have waited too long," Bush said. That month, two major foreign policy headaches -- a potential war between India and Pakistan and the administration's uncertain policy toward the Israeli-Palestinian conflict -- were also resolved, freeing the White House to turn its full attention to confronting Iraq.

Only later did it become clear that the president already had made up his mind. In July, the State Department's director of policy planning, Richard N. Haass, held a regular meeting with Rice and asked whether they should talk about the pros and cons of confronting Iraq.

Don't bother, Rice replied: The president has made a decision.

© 2003 The Washington Post Company

How GWB Became President

Three Texas surgeons were arguing as to which had the greatest skill. The first began: "Three years ago, I reattached seven fingers on a pianist. He went on to give a recital for the Queen of England."

The second replied: "That's nothing. I attended a man in a car accident. All his arms and legs were severed from his body. Two years after I reattached them, he won three gold medals for field events in the Olympics."

The third said: "A few years back, I attended to a cowboy. He was high on cocaine and alcohol when he rode his horse head-on into a Santa Fe freight train traveling at 100 miles per hour. All I had to work with was the horse's ass and a ten gallon hat. Last year he became president of the United States."

If you notice from the picture at the right, it looks as if Frodo has failed.

January 11, 2003
Governor George Ryan Makes Final Bold Statement on Death Penalty
Today Governor of Illinois George H. Ryan commuted the sentence of 163 men and 4 women on Illinois's death row from capital punishment to life in prison.

I will comment more on this in the near future. But in the mean time, here are some links surrounding the event.

January 10, 2003
Blog Update
I've posted a new template to this blog. In it, you'll see some navigation to parts of my site that don't exist yet. (The Stacks, Why I Am A Liberal, About). I've been trying to get help from the blogspot people on their ftp option, but they don't seem to answer their help site. Anyone who read this knows what gives?

Does anyone read this at all?
January 09, 2003
Inside the Mind of GWB on Iraq
The case for war with Iraq seems to grow weaker with each passing day. First, the North Korean crisis presents troubling inconsistencies in the administration's public case for Iraq. Second, weapons inspections with Iraq are turning up no evidence that Iraq is currently creating weapons of mass destruction, and the White House is loathe to present any evidence that contradicts this. Third, the administration continues to try and tie the impending war with Iraq with the War with Al Qaeda even in the face of evidence to the contrary.

So, any critically thinking person has to ask "What gives here?"

If I were your casual reactionary liberal, I would invoke the evil of stupidity (or the stupidity of evil) and how it relates to GWB.... and then I'd talk about Blood for Oil.

But I don't think that His Technicality is a psychopath or a greedy, oil-loving bastard, and I don't think those that work for him are idiots. So I have to think that the administration has some plan and has the benefit of the American people in their heart (misguided as it may be). So what could that plan be?

So, I tried to imagine a line of reasoning that would lead back to an intense desire to invade a Iraq, and this is what I came up with.

First, the main threat from the Middle East in the form of terrorism comes from the increasing threat of Islamic radicalism. So, to try to make the world safer for Americans, you need to reduce this threat.

The two most influential countries in the Middle East are Egypt and Saudi Arabia. However, currently we don't have a lot of leverage over either Egypt or Saudi Arabia. Saudi Arabia is our main supplier of oil, and relations with Egypt have hit a hard plateau.

Furthermore, Iran is one of the most virulent, anti-American theocracies in the Middle East, and Syria is another Baathist dictatorship in the vein of Iraq. The impending threat of Syria is an unspoken factor in the Israeli-Palestinian conflict, and Iran has consistently been thought to be one of the major supporters of internaitonal terrorism.

So, why Iraq?

Well, number one, Iraq is weak. Unlike North Korea, the US military believes it can steamroll the Iraq military with minimal casualties. Why? Because they did it before.

Once Iraq is defeated, the US can install a friendly regime and move the Prince Sultan Air Base from Saudi Arabia into Iraq. Iraq is centrally located in the region and would provide the US with a good base of any operations throughout the Middle East.

Second, the administration believes, like Bernard Lewis, that the Arab culture would respect the show of force by the US and, rather than inflame the Middle East, a successful invasion of Iraq would calm the region.

Third, a friendly democratic regime in Iraq would prompt the overthrow of the Iran theocracy by moderate, democratic leaning students. The US could then provide heavy encouragement and funding to the students from this base of operations. A similar argument could go for the overthrow of Syria.

Fourth, access to the Iraqi oil fields will make us less dependent on the Saudi oil reserves. We can then use our growing influence in the Gulf to persuade both Saudi Arabia to crack down on Islamic extremists, curb anti-Israeli propaganda, and promote greater democracy, especially the creation of secular parties.

Finally, for the foreseeable future, no regime in the Middle East looks poised to make the kind of reversal to a friendly, democratic regime that the US would need to bring this scenario to fruition.

Voila! A more stable Middle East and a reduction in terror. Kind of a reverse domino strategy, and Iraq is the key to the situation.

So why does the administration consistently talk up the weapons of mass destruction angle, rather than this long term peace in the Middle East scenario?

The nuclear threat of Sadaam is an easier sell to the American public (and to our coalition partners). "Nukes are bad, and Sadaam is crazy/evil" is much easier to communicate than this long term stability a democratic regime can provide to the military.

So, all this seems to be very rational. Why would a citizen oppose this future policy?

First, human beings are not very good at prediction and assessment of risk. This particular plan is complicated and it seems to me that there could be several scenarios along the way that could derail this progression of events and leave us in a worse situation than where we currently are.

Secondly, in the short term, this scenario exposes the US homeland to greater risk of terrorist attack by Sadaam and Al Qaeda with weapons of mass destruction (chemical poisons, biological agents, and even nuclear weapons). Even the CIA analysts claim that invasion of Iraq increases risk of a traumatic terrorist incidence in the US.

Third, and perhaps most importantly, this type of statecraft smacks of the 19th century European diplomacy that seems to violate the moral tenets of the United States. Most American citizens, I believe, support each nation in its sovereignty and belief to self-determination. If this is the administration's plan, it violates that ethic.

However, the situation is complicated. (More complicated than the current rhetoric.) It's unfortunate that our government thinks that we cannot have an open ended public debate on this, but I can understand the practical reasons why not.

In the end, I suppose the only judge for this action will be history and the success of this operation. But God help us if the foreign policy wonks in Washington have calculated wrong.

Some additional resources:

January 08, 2003
Some Reasons to Avoid Double Taxation of Dividends
Yesterday, I posted the question "What's wrong with Double Taxation?" After listening to Brad DeLong today on KQED's Forum in San Francisco, I got a great answer.

While I still agree that there's nothing inherently wrong with double taxation, Brad DeLong pointed out that there were real problems with double taxation of dividends.

In particular, taxation of dividends at both the corporate and the individual level tends to incent businesses to raise capital by issuing bonds rather than stocks. This increases a companies debt-to-equity ratio (which for many reasons in business is a "bad thing").

Interestingly enough, in a Wall Street Journal editorial on August 13, 2002, three professors of finance at leading insititutions believe that the best way to rectify this situation is not to abolish the individual tax but to grant dividends deductions from the corporate income tax.

"Some, including this newspaper's editorial board, have correctly identified tax policy as the source of this problem and called for both the deductibility of dividends at the corporate level and the abolition of dividend taxes at the personal level. But that proposal swings the pendulum too far in favor of dividends. Since interest payments to bondholders are treated as taxable income, exempting dividends from the income tax would give equity an unfair advantage. We believe that solely granting dividends deductibility from the corporate income tax, which puts debt and equity on completely equal footing, will achieve the same goals while costing the Treasury far less money."

So, now my question is why didn't the White House propose this?

Furthermore, as DeLong and others pointed out, this type of tax reform isn't really an economic stimulus. Wouldn't it be better to propose this type of reform with changes in the Alternative Minimum Tax system and other tax reforms? Or is this the only way politically viable way to get this through?

If I keep researching this, I may become a tax expert yet!

January 07, 2003
Paul Krugman on Double Taxation
Today's New York Times Paul Krugman article also wonders about double taxation:

Above all, [the White House economic stimulus plan is] supposed to end the evil of "double taxation."

Now lots of income faces double taxation, in the sense that the same dollar gets taxed more than once along the way. For example, most of us pay income and payroll taxes when we earn our salary, then pay sales taxes when we spend it. So why has it suddenly become urgent to ensure that dividends, in particular, never be taxed more than once?

That is, if they're taxed at all. In practice, the Bush plan would exempt a lot of income — rich people's income — from all taxes. Thanks to the efforts of lobbyists, today's corporate tax code has as many holes in it as a piece of Swiss cheese, and today's corporations take full advantage. Case in point: Between 1998 and 2001 CSX Corporation, the company run by the incoming Treasury secretary, John Snow, made $900 million in profits, but paid no net taxes — in fact, it received $164 million in rebates. This wasn't exceptional; the average tax rate on profits has fallen to a nearly 60-year low.

Anyway, even to debate the pros and cons of dividend taxation is to play the administration's game, which is to change the subject. Weren't we supposed to be talking about emergency economic stimulus?

Good question, Paul.

What Is Wrong With Double Taxation?
Today President Bush has announced is new Economic Stimulus Package. The centerpiece to this strategy is the elimination of the dividend tax. In justification for this, the White House stated the following:

It is fair to tax a company's profits, and under the President's plan, company profits will still be taxed but only once. It is not fair to tax this income twice by taxing the shareholder on those same profits. Double taxation is wrong - and it falls hardest on seniors.

I am not convinced. I do not see why double taxation is inherently unfair. Consider the following two scenarios.

We have two laws that tax income. Under the first law, my income is taxed at 15%. Under the second law, my income is taxed at 25%. Total income tax is 40%

We have one law that taxes income. Under this law my income is taxed at 40%.

While I may object to a hire tax burden, I don't see any difference in terms of fairness between these two scenarios.

Republicans have been very good imbuing value neutral or empty phrases with moral significance. In taxation, you have the twin pillars of the "death penalty" and the "marriage penalty." Could double taxation be the next new thing for Republicans?

January 06, 2003
Defending Freedom?
Recently there have been a spate of articles in people's blogs regarding the Transportation Security Agency. One of the more famous being Penn Gillette's account of his experience with the Los Angeles division.

Penn Gilette grew upset when a TSA employee inadvertently touched his crotch.

Last Thursday I was flying to LA on the Midnight flight. I went through security my usual sour stuff. I beeped, of course, and was shuttled to the "toss-em" line. A security guy came over. I assumed the position. I had a button up shirt on that was untucked. He reached around while he was behind me and grabbed around my front pocket. I guess he was going for my flashlight, but the area could have loosely been called "crotch." I said, "You have to ask me before you touch me or it's assault."

This was probably accidental, but Penn quickly escalated the situation, first by accusing the guy of a crime and second by involving the police. Penn did this because " freedom is kind of a hobby with me, and I have disposable income that I'll spend to find out how to get people more of it."

When I first read this article, all I could think about was the poor TSA guy. Here's a low level government employee in a new agency. He probably has a family of his own. He probably has to deal with hundreds of passengers everyday, and I'm sure a large portion of them look down on him. This TSA guy didn't pass the law for airport security or design the procedures. In his heart, he probably thinks he's helping stop terrorism. And to tell the truth, in his way, the TSA guys are doing more to stop terrorism than I am.

And here's this big celebrity who's going to put this poor TSA guy through the ringer because the TSA guy didn't utter the right incantation before the TSA guy started the search, and he does this in the name of Freedom.

If Penn Gilette was truly concerned about freedom, he'd use some of that 'disposable income' to challenge the more onerous clauses in the Patriot Act, rather than hassle some working stiff who's just trying to do a hard job.

January 05, 2003
Games Nations Play by Paul Krugman
This is a classic.

Games Nations Play

What game does the Bush administration think it's playing in Korea?

That's not a rhetorical question. During the cold war, the U.S. government employed experts in game theory to analyze strategies of nuclear deterrence. Men with Ph.D.'s in economics, like Daniel Ellsberg, wrote background papers with titles like "The Theory and Practice of Blackmail." The intellectual quality of these analyses was impressive, but their main conclusion was simple: Deterrence requires a credible commitment to punish bad behavior and reward good behavior.

I know, it sounds obvious. Yet the Bush administration's Korea policy has systematically violated that simple principle.

Let's be clear: North Korea's rulers are as nasty as they come. But unless we have a plan to overthrow those rulers, we should ask ourselves what incentives we're giving them.

So put yourself in Kim Jong Il's shoes. The Bush administration has denounced you. It broke off negotiations as soon as it came into office. Last year, though you were no nastier than you had been the year before, George W. Bush declared you part of the "axis of evil." A few months later Mr. Bush called you a "pygmy," saying: "I loathe Kim Jong Il — I've got a visceral reaction to this guy. . . . They tell me, well we may not need to move too fast, because the financial burdens on people will be so immense if this guy were to topple — I just don't buy that."

Moreover, there's every reason to take Mr. Bush's viscera seriously. Under his doctrine of pre-emption, the U.S. can attack countries it thinks might support terrorism, whether or not they have actually done so. And who decides whether we attack? Here's what Mr. Bush says: "You said we're headed to war in Iraq. I don't know why you say that. I'm the person who gets to decide, not you." L'état, c'est moi.

So Mr. Bush thinks you're a bad guy — and that makes you a potential target, no matter what you do.

On the other hand, Mr. Bush hasn't gone after you yet, though you are much closer to developing weapons of mass destruction than Iraq. (You probably already have a couple.) And you ask yourself, why is Saddam Hussein first in line? He's no more a supporter of terrorism than you are: the Bush administration hasn't produced any evidence of a Saddam-Al Qaeda connection. Maybe the administration covets Iraq's oil reserves; but it's also notable that of the three members of the axis of evil, Iraq has by far the weakest military.

So you might be tempted to conclude that the Bush administration is big on denouncing evildoers, but that it can be deterred from actually attacking countries it denounces if it expects them to put up a serious fight. What was it Teddy Roosevelt said? Talk trash but carry a small stick?

Your own experience seems to confirm that conclusion. Last summer you were caught enriching uranium, which violates the spirit of your 1994 agreement with the Clinton administration. But the Bush administration, though ready to invade Iraq at the slightest hint of a nuclear weapons program, tried to play down the story, and its response — cutting off shipments of fuel oil — was no more than a rap on the knuckles. In fact, even now the Bush administration hasn't done what its predecessor did in 1994: send troops to the region and prepare for a military confrontation.

So here's how it probably looks from Pyongyang:

The Bush administration says you're evil. It won't offer you aid, even if you cancel your nuclear program, because that would be rewarding evil. It won't even promise not to attack you, because it believes it has a mission to destroy evil regimes, whether or not they actually pose any threat to the U.S. But for all its belligerence, the Bush administration seems willing to confront only regimes that are militarily weak.

The incentives for North Korea are clear. There's no point in playing nice — it will bring neither aid nor security. It needn't worry about American efforts to isolate it economically — North Korea hardly has any trade except with China, and China isn't cooperating. The best self-preservation strategy for Mr. Kim is to be dangerous. So while America is busy with Iraq, the North Koreans should cook up some plutonium and build themselves some bombs.

Again: What game does the Bush administration think it's playing?

January 04, 2003
Norway Bombs US Embassy!
As reported in Aftepolten, three young Norwegians launched a barage of paper airplanes, one at a time, at a US Embassy to protest the war in Afghanistan.

"These are peace planes, not bombers," the three men reportedly hollered as they emptied two plastic bags full of carefully folded paper planes.

Who would have thought that Norwegians were this creative?
Gun Lobby Hypocrisy
Today on Instapundit, Glenn Reynolds complains about Montgomery County police using tips generated during the DC sniper manhunt to round up those who have violated Maryland's gun laws. Reynolds is incensed.

"This is sure to produce less cooperation in the future," states Reynolds "And it explains why so many gun owners don't trust the authorities: They've seen things used as excuses for anti-gun sweeps in the past."

Wait a second. Isn't the pro-gun lobby always arguing against new gun laws with the slogan, "Enforce those laws on the books!"? For example, how about this from the NRA website:

For more than a century, NRA has aggressively supported the strict enforcement of laws against violent criminals who misuse firearms and has worked to improve the criminal justice system. As just one example, NRA actively worked to insure that the Career Armed Criminal Act became federal law in 1984.

During the 1990s, NRA worked with state legislatures and governors to increase prison sentences, reduce probation and parole for the most violent criminals and to impose mandatory sentencing guidelines for repeat offenders.

Today, NRA continues to lead the call for expansion of “Project Exile,” a federal program that throws the book at felons who illegally possess firearms. Measures like these have been credited for violent crime decreasing for nine consecutive years.

Yet, when Maryland police intend to strictly enforce these gun laws by using tips legally gathered in another investigation, gun supporters are suddenly up in arms against these anti-gun sweeps.

From what I can tell, it's more like anti-crime sweeps.


January 03, 2003
Zero Tolerance Does Not Work
In Slate, Maia Szalavitz writes a great article on the failure of the zero-tolerance, drug treatment programs in many schools today.

From the article:

what if drug "treatment" doesn't work for teens? What if, rather than decreasing drug use, teen treatment actually encourages it by labeling experimenting kids as lifelong addicts? What if it creates the worst sorts of peer groups by mixing kids with mild problems with serious drug users who are ready and willing to teach them to be junkies? What if suggestible kids respond poorly to the philosophies that have made Alcoholics Anonymous and Narcotics Anonymous successful for many adults? Then we'd be using "treatment" to turn ordinary adolescents into problem drug abusers.

That's precisely what we're doing.

This type of ineffective and damaging policy stems out of a fundamental error in the philosophy of parenting, the over-estimating of the power of parents in the behavior of their children.

As Judith Rich Harris so elegantly argues in her book The Nurture Assumption, parental policies have little to no impact on the behavior of their children; rather, most of the environmental factors that significantly shape a person's behaviors derive from the interaction with their peer groups.

Therefore, the best (and perhaps only) way to modify a child's behavior is to move that child to a peer group that exercises the behavior you want to see.

In my reading of Harris, the drug treatment, zero-tolerance policy detailed here is almost the very thing parents (and communities) should NOT do. By placing their child in a peer group that shares this addictive behavior, parents are almost guaranteeing the results they want to avoid.

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