Compare And Contrast

Governor Messinger Dayton signed an increase in the state’s minimum wage today. 

What Governor Messinger Dayton Said:  “People who work hard should be paid enough to achieve the American Dream”. 

What Governor Messinger Dayton Actually Meant:  “I have now found a way to force the private sector to buy votes for the DFL”. 

Personal note:  One of my kids is working for more than the current minimum wage, but less than the new one.  I hope it’s the children of the sitting DFL legislators who lose their jobs when the wage rises, and not my kid. 

But I’m going to guess there’s not much chance of that.

Pass All The Bucks

Joe Doakes from Como Park emails:

A buddy notes the insidious lure of Somebody Else’s Money:

 The old Federal rule was that you can’t get food stamps unless you qualify under income guidelines. OR if you get at least $1.00 of heat share relief. So of course the various state programs freely handed out the $1.00 because they could leverage that dollar into 50 times as much in food stamps for their citizens.

 Congress, in an effort to curtail the cheating, raised the cut-off to require $20.00 in heat share assistance, thereby avoiding the token assistance cheating. Well, except that the states now simply raised the payment to $20.00. The heat share comes out of federal funding also, and in another article the funding was described as block share grants that typically have left-over funding at the end anyway. So there is no incentive not to hand out more of one welfare to qualify for more of another welfare.

 Right back to the typical hamster wheel. The voters would never vote to raise their own taxes to build a street car, or refrigerate an outdoor ice rink, or put art on $50,000 drinking fountains for the bums. We only go along with it because it’s paid for with magic federal money that doesn’t come from OUR taxes. So if we now need to kick in a small portion of the total wasted cost in order to get someone else to pay for the rest, we’ll gladly do it.

 This is akin to what is taught at the college level, of course. For one easy example: Housing on campus routinely costs double or triple what housing on the local economy will cost. (And of course either costs more than housing at the parental home but that comparison would ignore the value of NOT living at home while in school–the value of actually being part of the school environment.) Although it costs double or triple to live on campus, the financial aid office is geared to get you more in loans and grants to subsidize (short term) that inflated cost. Of course the same is true for any other cost on campus. Books that are used one day but cost $200/e. Lab fees for history class, things like that. Since it all gets hidden into the grants and loans the kid is taught that it isn’t worth discussion or worry. Just run up the tab and go with the flow.

 Joe Doakes

If you haven’t read “The End Is Near (And It’s Going To Be Awesome)” by Kevin Williamson, you need to.

Lies, Damned Lies, And Government Damned Lies

Joe Doakes from Como Park emails:

Government statistics are unreliable.

No lie, Bwana.

In the absence of reliable data, nobody can make sensible plans for business expansion, for retirement.  Our own government is killing our economic recovery.

The aggression of our government towards its own citizens in defense of politicians’ idiotic pet programs dwarfs the threat of Russian aggression.

Government aggression toward the citizens – and its parent, government believing it’s here to govern you, rather than the other way around – are going to be make-or-break problems for this society.

I have to say I’m not feeling optimistic.

Like Waiting For “One Direction” Tickets In A Blizzard

(SCENE:  Mitch BERG is walking his dog down Grand Avenue in Saint Paul.   He’s walking past an organic car repair shop when Avery LIBRELLE walks out, almost bumping into BERG).

LIBRELLE:  Merg!  Hah! I woke up this morning thinking “Merg must be feeling sad today! Obamacare is a huge success!”

BERG:  Well, it’s not really…

LIBRELLE:  Which bums you out more, Merg – that more people weren’t insured, or that less weren’t?

BERG:  Well, I’m just trying to figure out what all the happiness is about.

LIBRELLE:   Seven million subscribers!

BERG:  Let’s assume the Administration is giving real numbers.  That’s seven milion people who’ve signed up.  Not seven million paid, issued policies.  But if you put it up against the five million people wholosttheir coverage over the past year, that means we’re up a net two million – assuming they all actually pay their premiums, which all of them will not.

LIBRELLE:  You’re just jealous that no Republican healthcare plan gets people lining up for it!

BERG:  Wait – you say that’s a good thing!

LIBRELLE:  When people line up to buy something, that means it’s popular.    Like an iPhone!

BERG:  If that analogy held up – if Obamacare is extremely popular – then they’d have been waiting in line last October, when the plans first hit the market.  This is like people waiting in line to buy iPhone 3s before they go out of production.

LIBRELLE:  That’s stupid!  Nobody would do that!

BERG:  Unless it was your only shot at getting a phone, and you were going to wind up without a phone if you waited another day.  The “lines” had less in common with these…:

HyPsTrZ at the sacrament of unveiling.

…and much more in common with these…:

Waiting for bread in Moscow, 1980s

…or these:

Minnesota clinic, 2018. Just kidding – it’s a DMV line.

People trying to get something before an onerous deadline makes it impossible.

LIBRELLE:  Wow.  You’re a real debbie downer.

BERG:  As always, I’m a realist.  The Administration is trying to put lipstick on a dead pig in time to save the Democrats in time for the mid-terms.

LIBRELLE:  Hey – you used the word Democrat!  You hate women and their children!

(And SCENE)

Squeezed

I got this via email from a friend in Minneapolis:

Cam Winton posted about this on Facebook. The current city overseers do not want single family dwellings. They have said as much. We are not in their vision for the future. Our little happy lives living in single family homes is destroying their view of the world.

I rode the bus this morning with a neighbor today who shared his story of increased taxes, I shared mine, he told me of neighbors with huge jumps. At work I talked to another county employee who is ready to sell her house which is located about 4 blocks from mine. Reason…unbelievable hikes in taxes.

This is nuts. We are about to get rolled big time.

We certainly are.

Minneapolis and Saint Paul are indulging in several parallel liberal conceits:

  1. “Progressives” do, in fact, believe that there’s always a few more bucks they can wring out of any population.  The correspondent wrote that, suddenly, home valuations are skyrocketing in parts of South Minneapolis.  The idea is “pay up, or move away and let us get at all that choice property!”
  2. The idea that they know better than the free market how people want to live.  The essence of the free market is that if people don’t like, or want, a product, service or idea, they just say “no”.   As long as we have a free market for homes, people will choose what they want, and say “no” to what they don’t.  As Minneapolis is not New York or San Francisco (whatever its pretensions) – it’s built in an place with lots of land – most people eventually will look for some kind of breathing room.

Joel Kotkin predicts that at some point, “cities” as we know them today will become playgrounds for the very wealthy, and warehouses for the very poor, surrounded by…not so much “suburbs”, but exurbs and smaller communities where actual people will hold actual jobs.  I think Minneapolis is well on the way.

The War On Home

It’s one of those lines conservatives have been using for a decade, maybe two; the “progressive” left wants to move people out of single-family homes with yards and driveways, and into high-density housing.

Only it’s not a “line”.  It’s here, and it’s in Minneapolis right now.

Without warning, on Friday March 7th, 2014 the Minneapolis City Council passed a Moratorium(a full stop) on all new construction and certain remodeling projects EFFECTIVE IMMEDIATELY in the Southwest Minneapolis neighborhoods of Linden Hills, Fulton, Armatage, Lynnhurst, and Kenny. This Moratorium prohibits anyone without a completed permit from starting construction on a project for up to one year from the effective date.

They passed it unanimously.

The moratorium hurts everyone (except progressive planners), especially taxpayers in Minneapolis:

The reduced potential property tax base and permit revenue lost from the moratorium will cause property taxes on residents to go up yet again. So the question you should ask is, “Why should I pay the same tax rates now with a moratorium that I paid when I could fully use my property?”

Dear (mostly) relentlessly PC liberals of South Minneapolis:

This was the sort of thing that, 240 years ago, impelled a bunch of other impeccable liberals to throw a…

…dare I say it? A Tea Party.

Beneficiaries

Got this via email:

Who benefits the most from a minimum wage increase?

Here are some back of an envelope calculations:
40 hrs a week X 52 weeks = 2080 hrs

FICA: employee tax = 6.2%, employer = 6.2%, total 12.4%
SECA: employee = 1.45%, employer 1.45% total 2.9%

total FICA/SECA combined = 15.3%

current govt take
2080 x $7.25 = $15,080.00 x 0.153 = $2,307.24

proposed govt take
2080 x $10.10 =$21,008.00 x 0.153 = $3,214.224

Net gain for govt = $906.984

now just for fun lets index the minimum wage to the rate of inflation, who else gets an automatic raise with that?

Government Union members!

Subtitled

Joe Doakes from Como Park emails:

The President spoke at Union Depot in St. Paul the other day. Here is a transcript of his remarks:

***

My fellow Americans:

Our country is in a mess. I believe I’m the man to fix it. That’s why I’m announcing my candidacy for President in 2016. Yes, I know the Presidency used to be limited to two terms, but our problems are too serious to wait for Congress to act; therefore, I’ve revoked that limitation by Executive Order.

The biggest problem with the world today is that things are not equal. Inequality makes life unfair. It’s inequality and unfairness that are destroying the world and America with it. And Americans are the cause of that inequality and unfairness. It’s time for America to change. I hope Americans can change. No . . . I Know Americans can change. Ordinary Americans can change their lifestyles, and with them, the world.

Americans consume more natural resources, more energy, more food and more medical care than the rest of the world combined. Ordinary Americans need to cut back on everything so you live more like people in other countries.

Americans must eat less and let children go to bed hungry more often. Ordinary Americans must drive less and walk more, carry your groceries in reusable bags and haul purchases on your backs. Ordinary Americans must dress warmer and turn the heat down in Winter, open a window and turn off the air conditioner in Summer.

The world is over-crowded. We must reduce the surplus population. It’s essential that Ordinary Americans cut back on prenatal and infant care so more babies die prematurely. We must eliminate end-of-life care so old people pass more quickly. We need to double, even triple the number of abortions performed every day, to make room for new generations of illegal immigrants to take the place of natural-born Americans. All of you must live more simply, closer to nature, and for a shorter lifetime, the way the rest of the world does.

As President, I will oversee the transformation of every American’s lifestyle to one that I deem more appropriate for that person. I will use every power at my command to make Ordinary American lives hungrier, poorer, sicker and shorter. I know it’s a giant task but I do not shrink from it, and I will not be alone in my efforts: I will ask my most important friends and donors to assist me in redistributing the country’s wealth and reordering American society. And when Ordinary Americans finally achieve equality with the rest of the poverty-stricken world, when there is no First World, no Second World, no Third World, but only One World, I will voluntarily resign as President to accept the position of King of the World, to ensure that these good works continue with full vigor, that no Ordinary American will ever raise his head above another person, that equality of misery will be world-wide, universal and forever.

Thank you for your support.

***

Well, those may not have been his exact words, but I think that’s the gist of it.

Joe Doakes

“Fake but accurate”.

The War We Lost

In honor of the fiftieth anniversary of the “War on Poverty” – the only “war” at which the United States has ever been comprehensively defeated unto humiliation – John C. Goodman analyzes the results.

On the one hand, avoiding poverty – or rising out of it, with time and hard work – is at least conceptually fairly simple (although obviously requires work, patience and perseverence):

We now know a lot about how behavior affects poverty. In fact, if you do these four things, it’s almost impossible to remain poor:

1. Finish high school,

2. Get a job,

3. Get married, and

4. Don’t have children until you get married.

Simple – right?

But throughout the “War on Poverty”, we’ve been disincenting those exact behaviors:

So how does welfare affect behavior? In the late 1960s the federal government sought to find that out in what Charles Murray calls “the most ambitious social science experiment in history.”

The experiments were all conducted by social scientists who believed in the welfare state and had no doubt about its capacity to be successful…Randomly selected people were assigned to a “control group” and an “experimental group.” The latter received a guaranteed income, and the program even used Milton Friedman’s term for it: a negative income tax. The largest, longest and best-evaluated of these experiments was SIME/DIME (Seattle Income Maintenance Experiment/Denver Income Maintenance Experiment) in Seattle and Denver. And the results were not pretty. To the dismay of the researchers, they largely confirmed what conventional wisdom had thought all along. As I reported in “Privatizing the Welfare State”:

  • The number of hours worked dropped 9% for husbands and 20% for wives, relative to the control group. For young male adults it dropped 43% more.
  • The length of unemployment increased 27% among husbands and 42% for wives, relative to the control group. For single female heads of households it increased 60% more.
  • Divorce increased 36% more among whites and 42% more among blacks. (In a New Jersey experiment, the divorce rate was 84% higher among Hispanics.)

BTW, these results have been studied and studied over and over again and there is a large literature on them ? almost all of it written by researchers who detested the outcomes. Good summaries are provided by Charles Murray and Martin Anderson.

It’s like going to war – the real kind – and giving your soldiers Nerf guns.

The results?

Poverty is stuck at 1966 levels, and has been for almost fifty years.

Spending has soared in absolute dollars and in share of GDP.

And it’s entirely unsustainable – and things that can’t be sustained, won’t.

All In A Day’s Work

A high school friend of mine who lives in Texas, Jim, posted this on Facebook over the weekend:

———-

Q: Why does world-famous violinist Joshua Bell make $1M for each performance?

A: Because no one is stupid enough to pay him $2M – he’s just not worth that much.

(Implication: what you do has value. A finite value. And if someone else can and will do the same things you can do, for less money, then your value has been reduced to that lower amount. Unless, of course, one of a number of things happens:

  1. that other person is already working for someone else (more jobs, scarcity of labor),
  2.  you increase your value (through experience, education, or any of a sea of other factors),
  3. you decide to assume a greater share of the risk (starting your own business doing what you do, for example), or
  4. you find something new that you can do which will have greater value (new career, more responsibility, …).

What is exciting about all of these options is that, except for the first one, all are activities that you can do yourself. They don’t require that you supine yourself before some benefactor who will then own your future. What went so wrong with a society that no longer recognizes the beauty inherent in self-determination?

———-

What’s wrong is that we have a large, powerful interest in our society that profits handsomely from selling victimhood and dependence; the idea that all violinists, even people who’ve just picked up the instrument, should be making a “living fee” for their performances, just from pure fairness.

It’s a way of buying votes but making someone else pay for it.

Economic Whack-A-Mole

Joe Doakes from Como Park emails:

Liberal rag Washington Post finally notices that student loans prevent young people from buying a home.  And it’s getting worse as home prices are starting to climb in some areas.  Holy Study Hall, Batman: debt is Bad!

Geez, ya think?  It all comes back to the Instapundit’s observation on middle class markers. That’s the mentality that got us into this mess.

Middle class people need decent jobs.  Decent jobs require college degrees.  College is expensive so government gives out student loans to help people achieve the middle class marker of having a college degree to get a decent job.  Makes sense, right?

Middle class people own their own homes.  Homes are expensive so government guarantees home loans to help people achieve the middle class marker of owning a home.  Seems reasonable, doesn’t it?

Everything sounds great until we realize that student loan debt makes students ineligible for guaranteed home loans.  Worse, we can’t give debt relief to students because the profits from student loan interest payments are pledged to pay for Obama-care — we need the money from Peter’s student loans to pay Paul’s health insurance premiums.

Wouldn’t be so bad if homes were more affordable except the reason home prices are high is the Fed is pumping $60 Billion Per Month into the banking economy to shore up home prices so existing homeowners feel like we’re in a recovery, thus freezing out future generations from buying.

Do you ever wonder what would happen if we just stopped?  Just . . . stopped?

Stop subsidizing student loans.  What would happen?  Colleges would restructure themselves to become affordable.

Stop subsidizing banks.  What would happen?  Banks would adopt sensible banking practices to stay afloat.

Stop propping up home prices.  What would happen?  Home prices would collapse now so our children can afford to buy them (you and I are hosed already, we’ll never see prices return to save us).

Stop propping up any sector of the economy, just let everyone sort it out themselves.  Could it truly be any worse than what we have now?

Joe Doakes

That which can’t be sustained, won’t. That which can’t be sustained but is by brute government force, will – until the money runs out.

And it’s gonna run out.

Sophie’s Raise

The Congressional Budget Office has released one of those rare financial reports that has both sides crowing and declaring victory.

Who you believe – or weight the highest – likely depends on your economic literacy, politics, and what you do for a living.

The headline on NPR  - “CBO: Minimum Wage Hike Could Boost Paychecks – And Cut Jobs” – left wiggle room both ways:

Whatever you already believed about raising the federal minimum wage, you now have more ammo for your argument, thanks to a report released Tuesday by the Congressional Budget Office, titled “The Effects of a Minimum-Wage Increase on Employment and Family Income.”

Yes, you’re right: Raising the wage in steps to $10.10 an hour by 2016 would push employers to cut jobs — about 500,000 of them, says the CBO, the nonpartisan research arm of Congress.

On the one hand, according to one reading of the report, a hike to 10.10/hour – about 40% – would “lift nearly 1 million” out of poverty, and put money into “wallets of workers who are eager to spend”, and give a “raise” to 16.5 million people.

But then there’s those 500,000 jobs lost.

By the way, that’s about the softest estimate you can imagine; the CBO report itself says “As with any such estimates, however, the actual losses could be smaller or larger; in CBO’s assessment, there is about a two-thirds chance that the effect would be in the range between a very slight reduction in employment and a reduction in employment of 1.0 million workers” – meaning about a 30% chance that over a million jobs would be lost.

I’d bet those odds.

Oh, yeah – and “the poor” aren’t necessarily working for minimum wage, and it’s not “the poor” who’ll be getting most of the benefits:

Just 19 percent of the $31 billion would accrue to families

with earnings below the poverty threshold, whereas 29 percent would accrue to families earning more than three times the poverty threshold, CBO estimates.

That’s three dollars going to the middle class – mostly teenagers and other children of moderately well-off families – for every two going to “the poor” (that actually get to keep their jobs).

So like the protagonist in “Sophies Choice”, what do you do?  Make life marginally easier for “the poor”, at the expense of creating many more of them?

“Saving” Saint Paul’s “Soul”

I’ve snickered about “E-Democracy” – the liberal-leaning non-profit that has been running email list-serve discussion forums for something like twenty years.  Awash in non-profit money, they’ve expanded (more or less) all over the place – but have pretty much been a “progressive” echo chamber for most of the past fifteen years.

Which is, I suspect, all they were ever asked to be.

I watch ‘em, still – especially the Saint Paul “forum”.  Mainly for new blog material, or for warnings about Saint Paul government’s latest detour into delusion.

A group of contributors were discussing how to “save” the “soul” of Saint Paul.  By “soul”, they really meant “small ma and pa businesses” (and, by extension I suspect, the correct small ma and pa businesses; no gun stores, no motorcycle shops, no bars in “my” backyard, yadda yadda).

I responded.

———-

And by “soul”, you mean “small, local, ma and pa businesses” [1], or so I assume from the thread so far.

Simple.

And some of you are even flirting with some answers that sorta kinda make sense – but for the fact that they all rely on the agencies of politics to enable them. Meaning more “systems” for the well-connected to game [2], more picking of winners and losers by the people who are already in power. And this is non-partisan, by the way – it’s not even a Republican vs. Democrat thing [3].

But we could “save” Saint Paul’s “soul” in a breathtakingly short time – as in, make a huge start before the next Mayoral election [4]. It’d require a lot of people parking a lot of their preconceptions, and working for the benefit of *city* and its people, rather than the betterment of the city’s political class [5] – but let’s just imagine for a moment.

Here’s how you bring back Saint Paul’s “soul” – its small business community:

First: Declare a ten year business tax holiday. Not a TIF district. Not an enterprise zone. Not a tax break for businesses that fit the favored criteria, or a subsidy to get them going. No. Slash business taxes; make them the lowest in the state by a statutory ten percent. Abolish all city sales taxes. Yes – this would require some drastic, and for some painful, cutbacks at the city level [6]. But city government isn’t Saint Paul’s “soul” [7]. You want small business – and, while we’re at it, jobs and opportunity for all those kids, immigrants and poor people?  Give Saint Paul THE lowest business taxes in the state. And not by a close margin.

Second: Knock off the “living wage” talk. Many small businesses can’t afford it at all; others [8] can afford it only by hiring higher-skill workers who give much higher productivity than the traditional minimum wage worker. They hire fewer of them in the process. Why scare off small businesses? Not only should Saint Paul can the “living wage” talk, they should have a “training wage” for kids under 18 that work less than 20 hours a week *below* the regular minimums. That’ll actually make it *worth* it to hire the young and unskilled. [9] Long story short – let business pay for skills what the skills are actually worth on the open market – and let people work and learn the skills that make their time more valuable. That’s how its’ done *sustainably*.

Third: Put zoning back in its place. Quit trying to use the zoning process to create an urban utopia (according to the people in power, of course); pare it back to commonsense regulations. Especially parking regulations. It’s in the *businesses’* interest to make sure they have enough parking (why would you open a bar in a location with half a dozen parking spots?). Quit letting the NIMBYs hold the city’s economy hostage.

Fourth: Ditto regulations. Ruthlessly hack away business regulations that exist only to protect people who bent the ears of City Councilpeople 50 years ago. [10].

Fifth: Prune DSI back to inspecting for health and building-safety regulations according to *state* law.

So what’d happen?

Saint Paul would get *lots* of businesses.

Some would be chains. Yep. They have money, they invest it, they hire people and pay taxes.  You can not use government to pick winners and losers without distorting the market and making *everyone* a loser.

But you’d also get a lot more local businesses – because *they’d be able to compete* without an arm tied behind their backs! And this city would develop a *culture* of entrepreneurship – people would start businesses because *that’s what people do* in Saint Paul [11]. And that culture of entrepreneurship would open up financing, both through normal channels (the city would become a MUCH better risk for small business lending) and non-traditional (example: Asian family credit pools could start investing in Saint Paul, and start moving back from Woodbury and Burnsville. Maybe).

And that’s the *real*, *sustainable* way to “save” Saint Paul’s “soul” – create a place where someone can start at McDonald’s, learn the basics of how to get and hold a job, and then realize “Bull! I can make a better burger!”, write a business plan, find a location, and start grilling better burgers. And hiring a kid who works her way up, and decides she can do it better still. And so on.

THAT is how you “save” Saint Paul’s “soul”. [12]

So – let’s do it, shall we?

Mitch Berg
Private Sector Warrior
The Midway

[1] – Interesting term, “Soul”. Metaphysical – as opposed to many other metaphors that could describe a city. So – how are souls lost? By falling for whatever Big Lie your worldview abjures.  Like, to pick a hypothetical example, the idea that politics – which is nothing but the control over the state’s monopoly on force [13] – solves any problems without causing worse problems.

[2] – See: all the restaurants and bars owned by retired government employees that skate on their city inspections (everywhere, not just Saint Paul). Wash your hands before eating.

[3] In principle, anyway. That’s the problem with one party government; eventually you’re held accountable, even if only via your city going bankrupt on your 70-plus-year watch.

[4] It’d require different mayors and a whole ‘nother city council, of course. But work with me, here.

[5] The DFL, the special interests that support it; the hordes of rent-seekers, non-profiteers (including this very forum) and other favored members of the political class. And again, this is non-partisan; this would be equally true in a Republican city that’d been run into the ground – if you can find one.

[6] I’ve written about this before, in the past year; I won’t recap the whole proposal, but it does involve getting city government out of some areas. Kicker is, the city comes out way ahead. Stay with us, here.

[7] When I was younger and more rash, I’d have thrown in a “Carrie” or “Exorcist” joke here. But I’m clearly no longer that brazen plate-thrower.

[8] Including *both* Punch Pizza and Costco, by the way. From the President’s State of the Union! They were both terrible examples of businesses that pay living wages; Costco sells limited SKUs in bulk and locates only in fairly wealthy areas, and hires people at higher wages but with established skills (and contracts the minimum wage stuff, like working in the snack bar and handing out samples, out to subcontractors – who do NOT pay $11-15 an hour!). Punch is a high-end niche pizzeria with a high markup; time’ll tell if they succeed with the higher labor costs. But again – they also pick and choose who they hire. Go ahead – send your unskilled kid over there to apply. Let the forum know how it goes!

[9] But since this IS a city full of people who believe in living wages, start a program (privately) so that companies that pay better starting wages can advertise it on their front doors. Let ‘em put big “We Start At $11/hour!” signs, so that people who DO value a “living wage” can put their money where their mouths are (and gauge whether they get the same bang for *their* buck that stores with lower labor costs provide.

[10] Classic example of this: when I was in Jacksonville on business a few months ago, I travelled almost entirely by “shuttle”. That is to say, a van. A single van owned by someone who met a minimum set of standards (four wheels, seatbelts), and kept the van clean enough to attract customers. It wasn’t a posh van, but no worse than a cab – smelled better than any cab I’ve been in, ever – and it got me around Jax quickly and cost-effectively. I talked with the driver; no serious regulations other than the same vehicle safety rules everyone has to follow (which are perfectly effective), no Taxicab lobby to worry about breaking his knees, and he makes a *solid* middle-class living driving that van between the hotels, the business district and the airport. One of them (whom I used twice, and talked with about the system) gave me a card – he does with all his customers – and told me to call him when I need a ride next time I’m in Jax. And I will.

Anyway – there is no way a local businessman could set up such business in Saint Paul. And that’s a shame; our system enriches the cab company owners, at all of our expense.  This is just one of the examples of our business regulation making it impossible to start small businesses, for the dumbest reasons.

[11] Nope, it’s not “what people do” in Saint Paul in 2014. In Saint Paul in 2014, people work for government, or work outside Saint Paul. To the extent that there is a private sector in Saint Paul, it’s some very rugged people who can weather a lot of bureaucratic BS.

[12] Or shall we just continue making soothing sounds about helping small business by using policies that have made Saint Paul one of the most business-hostile cities in the upper midwest, all the while lining the pockets of the city’s political class and its hangers-on (sorry, those of you who I just described – it’s business. Not personal).

[13] I know – some of you see politics (in the form of government and the whooooole process) through soft-focus lenses. But it all devolves back to force. Try this: Stop paying your taxes, or put a statue the city doesn’t like on your lawn, or decline to send your kid to a government-approved school. Keep at it, and sooner or later someone with a gun shows up at your door to demand compliance. You can dress it up any way you want, but that’s really the essence of all politics at the end of the day.

The New, Slacker Normal

Joe Doakes from Como Park emails:

If you voluntarily reduce your income to avoid paying full price for child support, you are a deadbeat Dad.  We want people to work so they can afford things like medical care for their kids.

If you hide your income to avoid paying full state income taxes, you are a tax cheat.  We want people to work, on-book, and pay their fair share.

If you give away your income to qualify for nursing home care, you are disqualified from receiving it.  We want people to pay for their own medical care, if they can.

If you cut your hours, reduce your income, move it off-book, and make yourself poor on paper . . . you get Obama-care subsidies.

We don’t want people to work?  Who’s going to pay for all the free unicorns and rainbows?

Joe Doakes

The Obama administration’s whole “reducing the need to work” schtick reminds me of a joke from the nineties; “Q:  How many Microsoft developers does it take to change a light bulb?  A:  None; Bill Gates will declare Darkness ™ the new standard”.

Once They’ve Seen Paree?

I was reading a neighborhood Facebook group the other day.  A woman started spouting off about the “homelessness” in the Bakken oil fields, by way of hinting “maybe those people out there need much less of all that oil and exploration and stuff”.

And I thought – “Wow.  All those well-meaning Twin Citians – the media, the political establishment and just regular Metro-area folks – sure are concerned about the corrupting effects of jobs, prosperity, economic diversification and even a little wealth out there in the Badlands, aren’t they?

Like they should all go back to being season-to-season ranchers and farmers out in the middle of nowhere.  And speak when spoken to.

And then it occurred to me – that’s what it’s always like up in the Iron Range – only they never actually get to dig their mines, unlike North Dakota.  My native state actually managed to get something done – probably before the Strib and MPR knew what “Bakken” meant – before the suffocating hand of “benevolent, patronizing good will from their betters” descended upon them.

Lucky ND!

“…And I’m Here To Help”

Joe Doakes from Como Park emails:

When I studied abroad in college, the best deal was to ride a school bus to Winnipeg then fly to Amsterdam and on to Paris.  The trip took 24 hours and cost $460 in 1979 dollars which is worth $1,500 in 2014 dollars.  Canadian air fares were cheaper than American because our government regulated air carrier routes, creating mini-monopolies that kept prices high.

Today, I can fly Minneapolis to Paris direct in 9 hours for $1,200.

The one thing that Jimmy Carter did right was de-regulated airlines and made air fare affordable for ordinary Americans.

Of course, letting airlines decide which routes are profitable means some people lose air service.  Liberals are still arguing we ought to start subsidizing small airports again so people don’t have to drive to hub terminals to catch a flight.  It’s all about fairness, you see, and equality.  People who live in Minneapolis can jump right on the airplane.  People from Thief River Falls, Granite Falls or Cannon Falls must drive to the Minneapolis hub airport.

Yeah, it’s not fair.  But it’s cheap.  And that covers a multitude of other sins.

Deregulation worked for airlines.  Wonder how it’d work for other industries such as, say, health insurance?

Clearly Joe hates womyn.

Value

(SCENE:  Mitch BERG sits down at a small Vietnamese cafe on University Avenue.  He unwraps a Bahn Mi Dac Biet and is sitting down to read the newspaper when Avery LIBRELLE sits down in Mitch’s booth). 

LIBRELLE:  Hah, Merg!  The President sure pwn3d you wingnuts at his State of the Union the other night!

BERG:  Huh.  You thought so?  I thought it was a lot of pretty vapor.

LIBRELLE:  Hah!  He showed you wingnuts what was what!  Especially on issues of equality!  How women still make 77 cents to a man’s dollar…

BERG:  …yeah, that was bullshirt 20 years ago, when it was a matter of women taking more years off from their careers to have kids than men did.  And it still is.  Women with equal experience and records and credentials make about the same as men – within the bounds of statistical noise.

LIBRELLE:  Oh, he sure beat you up on the subject of the minimum wage!  Costco and Punch Pizza both start workers at $10 an hour!  If they can do it, anyone can!

BERG:  We talked about that yesterday.  Neither Costco nor Punch are representative of all, or even many, small businesses that employ low-skill workers…

LIBRELLE: Stop right there,you one percenter!  There is no such thing as a “low skill worker”!   Every worker’s skills have value, and every worker’s hard work is vital – indeed, more vital than the bosses!

BERG: Um, what now?

LIBRELLE:  That’s right!  Mitt Romney was frequently not at his desk at Bain Capital – but the janitors had to be there picking up the trash!  No janitors, no major deals!

BERG:  And, uh, we’ve been through that before too.  You think that if a janitor just started picking up stuff at random out on the street, it’d generate value?

LIBRELLE:  Don’t you value clean streets?

BERG:  Er, I already pay a bunch of public union workers with better pensions and insurance than I’ll ever have to do exactly that.  But let’s make sure we’re clear on this – all work is equally valuable?  So if a receptionist and a bunch of janitors sit down outside the bus station and start answering calls and cleaning things, a multi-billion dollar venture capital firm will spontaneously form around it?  Drawing billions in capital and the people who know how to negotiate its use?

LIBRELLE:  Happens all the time!

BERG:   Right.  But let’s look at the other half of your statement – the idea that all skills are useful, provided one works hard.

LIBRELLE:  They are!  All hard work must be rewarded!

BERG: All hard work?

LIBRELLE:  Yep.  The harder the work, the  more valuable it is!

BERG:  So someone who works sixty hour weeks for six months and spends half of his life on the road closing the financing for a deal that opens a factory that provides hundreds of jobs is worth the same as someone who, hypothetically, hammers rocks into smaller rocks as a form of artistic statement for sixty hours a week?

LIBRELLE:  Same?  The rock-breaker should make more!  He…

BERG: …or she…

LIBRELLE:  …of course, works very hard!  Have you ever operated a hammer?

BERG:  Sure I have.  Have you?

LIBRELLE:  The union would break my knees if I did – and I may file a grievance against you, for that matter – but I know the basic theory.  It’s hard work.  Much harder than computing spreadsheets and talking with banksters and sitting on airplanes.

BERG:  But it generates no value!

LIBRELLE:  Says you!

BERG:  Er, yeah.  Sez me!  The act of breaking rocks into smaller rocks for twelve hours a day is of no value to anyone!  It’s even a terribly inefficient way to make gravel!

LIBRELLE:  Perhaps to your bougeouis, one-percenter sensibilities!

BERG: Any rational person’s sensibilities!  I mean, here’s a test for you:  How much are you willing to pay, from your own pocket, for someone to break rocks into smaller rocks as a form of artistic statement?

LIBRELLE:  Well, Merg, that just shows how ignorant you are about economics!

BERG:  You don’t have an answer, then?

LIBRELLE:  The real question is this:  how long do you really think girls should sit in jail for having an abortion?

(Dish of pho arrives at table)

LIBRELLE:  Excuse me – I ordered pho.  What is this?  You charge $5 for a bowl of noodles with crud in it?

(And SCENE)

Doakes Sunday: Our Next Import

Joe Doakes from Como Park emails:

First, England is cutting back welfare for unemployed immigrants.  Now Sweden is shifting away from socialized medicine to private pay because socialized medicine doesn’t work.

All of these policies contradict President Obama’s initiatives and, as we all know, the President is a Black man.

Why are Europeans such racists?

Because they’re so full of…well, Europeans, obviously.

Doakes Sunday: Downmarket Abbey

Joe Doakes from Como Park emails:

Politicians in the United Kingdom are doing the math.

Britons without jobs: 413,000.

Immigrants who have jobs: 736,000

Plainly, some immigrants have taken jobs from Britons while other immigrants are sitting on welfare.  In response, the government is tightening up the rules.  Immigrants will find it harder to get on welfare and won’t be able to stay on welfare as long as before.

Meanwhile, President Obama assures us Republicans are just as eager as he to open the immigration floodgates.

Joe Doakes

The parallels between the US in the Obama era and Britain from 1965-1978 are unmistakeable.

The American Quagmire

This year, as the National Review’s editors remind us, is the fiftieth anniversary of the declaration of war on…poverty. 

Of course, poverty – which had been dropping steadily since the end of World War 2, as the US enjoyed an unprecedented period of economic supremacy after the war – rose after Johnson “declared war” as part of his “Great Society”, which was little more than an extension and expansion of the New Deal.  It dipped under Reagan, rose and then fell under Clinton, and has reached a new peak under Obama.

P.J. O’Rourke, in his classic book A Parliament of Whores, once half-joked that if we took the money our bureaucracy spends on poverty in all its forms – food assistance, housing assistance, medical aid, cash, WIC, all of it – and simply gave it to the poor, we could raise ever single American’s income to above the poverty line, and save money in the process. 

The problem, of course, is that the War On Poverty was never really designed to fight poverty.  Oh, there was an altrusitic motivation, to be sure – many Poverty Warriors do honestly believe their mission is to lead the poor out of perdition.

But as with all of the left’s big initiatives, it’s really about consolidating and extending power. And so while the war on poverty has been a miserable failure at ending the misery of being poor, it’s been a magnificent success at extending the reach of the “progressive” stranglehold:

No doubt programs such as Head Start were launched with a great deal of idealism, but as their ineffectiveness became apparent, it was not idealism that sustained them but political self-interest. Providing at best temporary relief to the poor, the permanent welfare bureaucracies benefit Democrats by creating thousands of well-paid positions for their political allies and subsequent campaign contributions for their candidates. Head Start today is a money-laundering program through which federal expenditures are transmitted to Democratic candidates through the Service Employees International Union, which represents many Head Start teachers. The National Treasury Employees Union, which represents, among others, the welfare bureaucrats at the Administration for Children and Families, is a large political donor that gives about 94 percent of its largesse to Democrats. This is not coincidental. The main beneficiaries of the war on poverty have not been and will not be the poor; the beneficiaries are the alleged poverty warriors themselves. The war on poverty is war on the Roman model in which soldiers are paid through plunder.

Perversely, the “War on Poverty” has institutionalized the things – single-parent households, terrible education – that truly entrench poverty. 

And as we head toward a legislative session (in many states including Minnesota) where the Democrats will move to drag business into the role of paying for the War via massive hikes to the minimum wage, it’s worth remembering this:

Democrats are scandalized that Republicans resist the expansion of welfare benefits, and Republicans are, or at least should be, scandalized that so many Americans need them. What looks like compassion in the short term is in the long term a refusal to deal with the problem: in some cases an inability to find sustaining work, in others a refusal to do so.

It’s tempting, and tantalizing, to wonder – what would have happened had America not squandered so much of its hard-earned treasure on a “war on poverty” that ended up only entrenching and expanding poverty, and reinforcing the party of poverty, the Democrats? 

How much more prosperous would be be today?  How much less misery would there be?

Read the NRO editorial.

Start the Revolution Without Me

New York is anything but blasé as de Blasio takes office.

If Supreme Court Justice Louis Brandeis was correct that States are the “laboratories of democracy,” then perhaps America’s cities are the petri dishes – developing political cultures at a micro level.

For 20 years, the Big Apple had largely quarantined the most aggressive tendencies of New York liberalism through a succession of centrist Mayors.  Even for all his nanny-state inclinations, Michael Bloomberg was (as we once noted) all that stood between the average Gothamite and an “army of liberal partisans who saw City Hall as Grand Central Station for a variety of socioeconomic engineering ideas.”

It should be of little surprise then that newly ensconced New York Mayor Bill de Blasio’s campaign certainly looked like something engineered in a political science lab.  De Blasio’s “tale of two cities” rhetoric, his promises to end “income inequity” and repeal “stop and frisk” defined his candidacy as being in stark contrast to Bloombergian Era.  Despite Bloomberg polling at a 51% approval as he left office and his supposedly controversial police chief Ray Kelly at 64%, de Blasio won running directly against the accomplishments (and their architects) of prior two decades.  Voters who cared about crime and candidate experience – once centerpieces to any New York campaign – barely broke for Republican Joe Lhota, and constituted a paltry 15% of the vote.

De Blasio’s supporters haven’t minced words about the expectations his overwhelming election has created in liberal circles, calling his mayoralty a “progressive revolution.”  Such rhetoric, amplified by a litany of speakers at de Blasio’s inauguration that trashed Michael Bloomberg (with apparently with de Blasio’s consent, as he stated he was “very comfortable with all that was done”), glosses over what exactly entails a “progressive revolution”?

From the early previews, de Blasio’s “revolution” may resemble Michael Bloomberg’s in one key, and often criticized, factor – policy tinkering instead of major reforms.  Candidate de Blaiso talked on the campaign trail about affordable-housing projects, stopping hospital closures, and a tax on upper-income earners to fund, in part, universal pre-kindergarten.  The first act of Mayor de Blasio was to end the handsome cab, horse-draw carriages – a move that drew criticism left and right, and even speculation that the position was based on a campaign pay-off.

Even when de Blasio talks about broader political themes, such his obsession with reducing “income inequality,” it’s rarely followed by policy prescriptions that will address the issue.  Some of de Blasio’s proposals will require support from Albany to enact, including aspects of his desired pre-K and after-school programs, while others reek of desperation to find an agenda, regardless of impact or practicality.  De Blasio declared he would expand the Paid Sick Leave law…which was just passed months ago and hasn’t even been enforced yet.  De Blasio campaigned on a goal of “zero deaths” in New York –  a policy that sounds like it was crafted by King Canute the Great.

If de Blasio truly wanted to address “income inequality,” he could look at New York’s punitive tax structure.  A married couple with $60,000 in taxable income pays nearly $2,000 in taxes to the city alone.  That doesn’t include the 25% federal tax rate for a couple in that income bracket, or the State of New York’s $3,200 in taxes as well.  Without including property taxes, school board levies, and a host of other taxes (how about the city’s 8.875% sales tax?), a couple with $60,000 in earned income would be paying out over $20,000 in taxes in one of the most expensive cities in the world.  Is that “equality”?

The Last Five Years Have Felt A Bit Like A Biblical Plague…

Joe Doakes from Como Park emails:

It’s the start of a new year, when Christians remember The Flight Into Egypt.  Suppose President Obama were to read about it in the Bible.  He might notice modern parallels.

The Wise Men were looking for a New King, someone to fundamentally change the government.  Herod was already King and didn’t want to be replaced.  He ordered all sons under the age of two, to be killed.

President Obama, reading this, might realize Jesus was predicted to oppose government.  That makes Him a bitter-clinging-religious-terrorist.  Herod’s Massacre of Innocents was simply an Executive Order preemptively issued for National Security reasons.

Suppose President Obama, inspired by historical precedent, issued his own Executive Order that all White-Males-Two-And-Under should die.  But since there are so many sons and so few federal government employees to kill them, suppose the Order included an Employer Mandate: all employers are required to kill the White-Male-Two-And-Under sons of their employees, or be fined out of business.

Suppose some employers claimed that a government mandate to kill children of employees violated the employer’s religious beliefs under some ancient fringe religion, something about “Thou Shalt Not Kill.”  And not just churches that employ janitors, but businesses that employ people to sell fried chicken or woodworking tools or cabinetmakers, suppose they objected, too.

If a Supreme Court Justice stopped the killing until the Court could hold a hearing, would the New York Times tut about threatening the security of the nation?

If the Employer Mandate didn’t require Employers to actually kill the sons, merely to hire someone else to kill the sons for them, would that be okay?

If the Department of Hunting Sons (DHS) issued a rule saying certain employers were exempt from killing one-and-two-year-olds, they only need to kill unborn sons to comply with the law, would that make it all better?

What’s it going to take to get these fundamentalist whackos to see The Light?

Joe Doakes

I’m going to start calling Democrats “Obama Fundamentalists”.

Maybe “Bitter, Obama-Clinging Fundamentalists”.

An Entire Economy Of (Ahem) Shots In The Dark

Our labor force participation rate is such that employment, for all the jabbering about the current ~7% rate, is scarcely better than it was in 2009.  Investment is still glacial (except in the stock market – which is not the same as “investing in the economy”. 

Kevin Williamson at the National Review may be the single best writer in America on the subject of government and its effect on the nation, the economy, and The People.  He combines off-handed humor with blistering, airtight analysis. 

And as such, I highly recommend you read his New Years’ wrapup, “A Year of Fear“.  The whole thing is worth reading.  But I’m pulling out the conclusion, about the effect  uncertainty has in crippling an economy. 

“But wait”, lefties say; “my pension fund is going great guns!  The Dow is over 15,000!”

Yeah, it is.  And that’s a little like seeing your car idling at 10,000 RPM and assuming that’s because it’s raring to go. 

The conclusion is the big beef, here; I’m adding emphasis:

The Obama administration has achieved a special distinction here: Investors are faced with considerable uncertainty vis-à-vis how it might interpret rules as compared with the Bush or Clinton administrations — and also about how it might interpret rules as compared with the Obama administration the day before yesterday. Now you see a mandate, now you don’t. And as bad as it is in 2013, the seething hostility of Elizabeth Warren is ascendant on the left, a fact that offers very little encouragement to entrepreneurs and investors considering illiquid, long-term positions — things like factories, stores, and buildings, as opposed to easily liquidated investments in financial instruments.

Another common lefty complaint?  “Companies are too focused on profits!”

Many on the left complain about the “financialization” of the U.S. economy, while unwittingly helping to encourage that very phenomenon. Given a choice between dividing up his investments between a couple of hedge funds and financial firms or locking it up for ten years in an assembly line in Indiana, a sane man will consider the question of uncertainty and predictability. And under current conditions, the assembly line is a risky bet.

Perhaps 2014 will be the year in which we learn the value of predictability. Who can say?

Read the whole thing. 

Better yet, get an Obama supporter to read it.

Controlled Deflation

Even as American progressives continue to ramp up their push to make our social welfare state as European as they can make it, the Europeans are actually getting smarter.

The Dutch are following the Swedes in tightening up their welfare system:

The Dutch have just announced a massive reform of their welfare system, designed to reduce dependency and put a new emphasis on work. For example, welfare applicants will now be required to prove that they spent at least 4 weeks actively searching for a job before they become eligible for any assistance. And once they begin to receive benefits they will either have to work or perform volunteer community service. Dutch welfare recipients would be required to take available jobs even if they had to move or commute up to three hours per day…According to the Dutch government, the reforms will ensure that welfare is seen as “a safety net, rather than a right.”

No word if “Occupy Den Haag” has reacted yet.

Goalposts

Joe Doakes from Como Park emails:

The number of Americans filing for unemployment dropped.  The headline makes this sound good but it’s actually not.

Look at it this way: suppose there are 100 people in the economy and 7 get laid off.  That’s an unemployment rate of 7%.

Now there are 93 people working.  If 7% get laid off again, that’s 6 more people out of work.  True – fewer people are getting laid off (only 6 instead of 7) but that’s because there are fewer people working to GET laid off.  The measure of a healthy economy is not how many people are out of work, it’s how many people who want to work, can find work.

The Labor Force Participation Rate has dropped so low that fewer than 63 people are working out of every 100 living in America.  The other 38 are out of work, out of unemployment benefits and have quit looking for work.  That’s the lowest percentage of working Americans since Jimmy Carter was in office.  That’s the tax base we’re expecting to pay for Social Security, Medicaid, Medicare, Obama-care, student financial aid, foreign aid, farm aid, light rail and oh, yes, fighting wars in a dozen countries.

Joe Doakes

It is not necessary for people to return to work. It is necessary that the media make people think people are returning to work.

Thus racism.