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Thursday, January 31, 2008
Juvenocracy and the Decline of the Family
Emphasis on the baby part of the Baby-Boomer college anarchists has given us a self-centered and infantile nation that has fallen into social and political disrepair. The only question is how far down the road to hell we have fallen, and whether we can regain solid ground.
Kay Hymowitz’s recent article in City Journal paints a dispiriting picture of America’s young men as hedonistic, selfish loners unwilling to assume the commitment and responsibility of marriage and raising children.
Quote:
Not so long ago, the average mid-twentysomething had achieved most of adulthood
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Wednesday, January 30, 2008
The Fed Ignores Inflation at its Peril
Despite Chairman Bernanke’s optimism, inflation is not under control.
Everyone, from the Fed to Congress and the White House, is focused upon injecting liquidity into the economy to paper over the credit difficulties besetting the banking business and homeowners.
They are deceiving themselves and exacerbating the problem.
Jim Grant, in a New York Times op-ed article, sums it up admirably well.
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Tuesday, January 29, 2008
Russia: What Happens When Oil Prices Drop Again?
Liberals think that greedy oil companies control oil and gasoline prices. Unfortunately for Russia, that’s fiction.
The devastating stagflation of the 1970s gave us the highest rates of inflation in the nation’s history, coupled with high unemployment. The cause was Presidents Johnson and Nixon opening the Federal deficit-spending spigot for the liberal-progressive Great Society in the mid-1960s and keeping it open into the 1970s.
As gasoline prices soared to compensate for inflation, President Nixon imposed price controls in 1971. President Carter left them in place.
We got record-high gasoline prices and shortages of gasoline. People were compelled to sit in sometimes hours-long lines at gasoline filling stations, hoping to reach the pumps before the station ran out of gasoline.
Not until President Reagan took office in 1981 were price controls lifted. The Federal Reserve, with Reagan’s backing, curtailed the money supply and finally halted inflation. That brought world oil prices back down and ended our gasoline shortage.
The message is that oil prices go both ways: up and down.
For the past couple of years we have endured a somewhat similar surge in oil and gasoline prices, induced this time by inflation and dollar devaluation, together with growing demand in China and other Asian markets and the threat of Al Queda and Iranian terrorism in the Middle East oil production territory.
Russia, as a major oil producer and exporter, has enjoyed a resurgent economy, supported hugely by high prices and high demand for oil. The danger is that, when oil prices next collapse, Russia’s economy may crater. If that happens, there could be a return to the iron-handed dictatorship of the Soviet era.
In that regard, read City Journal’s review of Collapse of an Empire: Lessons for Modern Russia, by Yegor Gaidar.
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Monday, January 28, 2008
Strength and Serenity in a Troubled World
Marie Jon’ reminds us that, in addition to stopping Islamic terrorism militarily, we should pray that God will soften the hearts of the Muslim world and turn them away from violent jihad towards peaceful coexistence.
The Power Of Praise And Prayer
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Using Federal Troops Within the United States
A little known survival of British common law is the source of authority for Presidents’ deploying military troops to maintain domestic law and order.
Posse Comitatus in America
By Melanie K. Wooten
The phrase “posse comitatus” is Latin and translates as
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Bono and Bill
Well-intentioned, but ignorant campaigns by Bono at the G8 conference in the UK and, more recently, Bill Gates at Davos.
Sunday, January 27, 2008
How to Treat Addiction
We must make choices: larger and more frequent doses of self-indulgent hedonism, or struggling back into the real world.
Jan Paul Burr alerted me to this excellent article recapping the economic, political, and moral malady besetting our nation:
Letting Go of Our Defenses by J. R. Nyquist.
What Is Worship?
True worship is in every individual’s heart and soul.
Sunday’s sermon at Black Rock-Long Ridge Congregational Church (North Stamford, Connecticut) was preached by Pastor Josh Feay.
His message was that worship is realizing Who God is and giving thanks for what He does for us.
Therefore, I urge you, brothers, in view of God’s mercy, to offer your bodies as living sacrifices, holy and pleasing to God
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Disturbing Prospects for Our Future
The United States already is being out-musseled in strategic parts of the world by China and the European Union, the two main challengers to America’s superpower status.
Waving Goodbye to Hegemony, by Parag Khanna, appears in the current issue of the New York Times Sunday Magazine.
The article’s writer is a senior research fellow in the New America Foundation, a center-left to far-left think tank. But don’t let that deter you from reading and pondering his insights.
The article raises issues and outlines a realignment of world geo-political forces that threaten America’s future.
Among other things, by inference, it raises profound doubts about the suitability of any of the Democratic Party candidates to deal effectively with a hostile world driven by real economic, political, and military interests. The reality described by Parag Khanna has no connection with liberal-progressive fantasies about a make-nice diplomatic world governed by the UN and the socialist religious dogma of social justice (i.e., redistributing Western wealth to the poorer countries of the world).
Among other thing, he recognizes that the issues at stake are economic: the competition for control of long-range strategic natural resources, capital, and markets. He also notes that the Pentagon’s structural organization and its geographic divisions of world power are more in line with those of China and the EU than are those of the State Department. Accordingly, he recommends bypassing the State Department and transferring management of foreign affairs to the Pentagon.
Finally, unlike Democratic Party presidential candidates, the writer calls for an increased role of American business in the process of rebuilding our foreign policy to counter the rising strength of China and the EU.
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Saturday, January 26, 2008
What Happens When Liberals Raise Taxes
The creator of the Laffer Curve explains.
In an op-ed article in the January 25 edition of the Wall Street Journal, Arthur B. Laffer reviews the statistics on results of changes in income tax rates. A few quotations:
But missing from the discussion are the huge differences in how the top 1% of income earners respond to changes in tax rates versus, say, the bottom 75% or 80% of taxpayers—the so-called middle class and lowest income groups. The “rich” quite simply are not like the rest of us…
Some 99% of all taxpayers paid taxes at the 10% rate in 2005, for example. Yet only 25% of all taxpayers had 10% as their marginal tax rate. Thus a cut in the 10% tax rate would have a supply-side impact on a relatively small portion of all those who pay the 10% rate—while for the rest who pay the 10% rate, a tax cut would result in a deadweight revenue loss.
On these grounds alone one should expect a greater supply-side response with a change in the highest tax rate than any other tax rate.
In addition, low-income earners have a lot less flexibility to change the form, timing and location of their income—and the avenues open to them to reduce their tax liabilities are far fewer. The avenues open to higher-income and highest-income earners include 401(k)s, IRAs, Keogh plans, itemized deductions, lifetime gifts, charitable gifts, all sorts of deferred income compensation plans, trusts, tax free bonds, etc…
Academicians and politicians have finally come to understand that it’s the after-tax rate of return that determines people’s behavior. Even though statutory tax rates are far lower today than they were when, say, Kennedy or Reagan took office, it is still very true that for every dollar of static revenue change there is a much larger incentive affect in the highest tax bracket than in the lowest tax bracket.
But what actually happens to tax receipts by income tax bracket when tax rates change?
Since 1980, statutory marginal tax rates have fallen dramatically. The highest marginal income tax rate in 1980 was 70%. Today it is 35%. In the year Ronald Reagan took office (1981) the top 1% of income earners paid 17.58% of all federal income taxes. Twenty-five years later, in 2005, the top 1% paid 39.38% of all income taxes.
There are other ways of looking at tax receipts by income bracket. From 1981 to 2005, the income taxes paid by the top 1% rose to 2.96% of GDP, from 1.59% of GDP. There was also a huge absolute increase in real tax dollars paid by this group. In 1981, the total taxes paid in 2005 dollars by the top 1% of income earners was $94.84 billion. In 2005 it was $368.13 billion….
Over the last 25 years, the bottom 75% of all taxpayers’ tax payments fell and their tax rates fell. This is the group the Democrats are targeting for tax cuts…
Using recent data, in other words, it would appear on its face that the Democratic proposal to raise taxes on the upper-income earners, and lower taxes on the middle- and lower- income earners, will result in huge revenue losses on both accounts. But some academic advisers to Democratic candidates have a hard time understanding the obvious, devising outlandish theories as to why things are different now. Well they aren’t!
In the 1920s, the highest federal marginal income tax rate fell to 24% from 78%. Those people who earned over $100,000 had their share of total taxes paid rise—from 29.9% in 1920 to 48.8% in 1925, and then to 62.2% in 1929. There was no inflation over this period.
With the Kennedy tax cuts of the 1960s, when the highest tax rate fell from to 70% from 91%, the story was the same. When you cut the highest tax rates on the highest-income earners, government gets more money from them, and when you cut tax rates on the middle and lower income earners, the government gets less money from them…
Mark my words: If the Democrats succeed in implementing their plan to tax the rich and cut taxes on the middle and lower income earners, this country will experience a fiscal crisis of serious proportions that will last for years and years until a new Harding, Kennedy or Reagan comes along.
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