Reinke Faces Life

https://mailchi.mp/tomwoods/high-taxes?e=39307912ab

Tom Woods · PO Box 701447 · Saint Cloud, FL 34770 · USA 

FROM HIS EMAIL BLAST OF 2019-Jan-16 10:26PM

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Here’s my unfashionable opinion: I believe in tax cuts for the rich. (I believe in tax cuts for everyone.) I believe the rich are human beings with rights, and not cash cows to be milked by people who had nothing to do with the creation of their wealth.

Now what follows is just for you, and not for your social-democratic friends, who will listen to what I say and respond with, “That’s trickle down, which doesn’t work!”

Those people are anti-intellectual and can’t be reached. What I’m telling you here is for the sake of your own understanding, not theirs.

Here is how wealth is created, and why confiscating the incomes of high earners is so destructive.

When firms increase and improve the equipment and machinery at the disposal of workers, those workers’ labor becomes more productive. Imagine someone using a forklift (as my father did), as opposed to stacking pallets with his bare hands, or producing books with modern equipment as opposed to a 16th-century printing press. The amount of production the economy is capable of is thereby increased, often dramatically, and this increase in production puts corresponding downward pressure on consumer prices (relative to wage rates).

There is nothing natural or inevitable about the availability of this productivity-enhancing capital equipment. It does not fall out of the sky. It comes from the wicked capitalists’ saving, and the allocation of the unconsumed resources in capital investment.

This process is the only way the general standard of living can rise. Only in this way can the average laborer produce the tiniest fraction of what today he is accustomed to producing. It follows that only under these conditions can he expect to be able to consume the tiniest fraction of what today he is accustomed to consuming.

The increases in the productivity of labor that additional capital brings about push prices down relative to wage rates. By increasing the overall amount of output, such increases raise the ratio of consumers’ goods to the supply of labor. Put more simply, improvements in the production process that lead to an increased supply of consumer goods make those consumer goods cheaper and easier for people to acquire.

That’s why, in order to earn the money necessary to acquire a wide range of necessities, far fewer labor hours are necessary today than in the past. Thanks to capital investment, which is what businesses engage in when their profits aren’t seized from them and when savings are available to them to invest, our economy is far more physically productive than it used to be, and therefore consumer goods exist in far greater abundance and are correspondingly less dear than before.

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And, he has a list of how productive has cut the “cost” of certain items in terms of the work hours needed to acquire them.  Very impressive.

“Tax the rich” is code for make everyone poorer by preventing “capital formation”.  Zero interest rates have wiped out savings by what’s left of the middle class.  If there is no “capital investment” because the “rich” are tax and unable to invest, then where does “capital investment” come from?  

I know “the money tree” that grows in everyone’s backyard!

Argh!

Today’s politicians and bureaucrats need to go to the figurative guillotine before the USA has its own version of the French Revolution.  Can these people possible be this stupid about economics?

I wonder.

TANSTAAFL (“There Ain’t No Such Thing As A Free Lunch” From Robert Heinlein’s classic) 

Or are they just blinded by their “power”?

Argh!

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http://www.economicpolicyjournal.com/2018/04/whos-we.html

SATURDAY, APRIL 14, 2018
Who’s the “We”?
Donald J. Boudreaux

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You’ll say that the “we” is Americans – to which I say that our capacity as Americans to make all these marvels has emphatically not been dismantled.  We do make them, sometimes directly and other times in a roundabout way.  But always we make them.  As the economist David Friedman points out, we Americans have an ingenious machine for transforming the corn that we grow in Iowa into automobiles that we drive.  That machine is called a “cargo ship.”  Into the ship we put corn and, a few days later, out of the ship comes automobiles.  We make cars by making corn.  This production process is akin to every other production process: mix various inputs together to produce something different and greater than the sum of its parts.

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Now that’s an insight.

And the Gooferment should get out of the way of “we” filling up the outbound ships with “stuff”!

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https://www.aei.org/publication/exposing-the-minimum-wage-fallacy-its-an-ironclad-law-of-economics-that-to-stimulate-one-group-you-have-to-un-stimulate-another-group/

Mark J. Perry@Mark_J_Perry
December 28, 2017 1:38 pm

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Exposing the minimum wage fallacy — it’s an ironclad law of economics that to stimulate one group (workers) you have to un-stimulate another group (businesses)

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But here’s a question that never gets asked (or answered) by EPI and minimum wage supporters: Where will the $5 billion in additional wages come from? While thinking about this overlooked question that reveals an important economic fallacy, I was reminded of a similar economic fallacy illustrated by Henry Hazlitt’s famous essay on the broken window, which exposed the economic fallacy of the “blessings of destruction.” Using Henry Hazlitt’s essay as a template (which is actually based on Bastiat’s original essay on the broken window fallacy from 1850), I’ve written a new essay below to expose what might be called the “blessings of the minimum wage fallacy” on the eve of the 18 minimum wage increases schedule to take place next week.

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Groups like EPI that support increasing the minimum wage do a great job of addressing the benefits of higher wages to low-skilled workers, but then completely ignore the costs of those artificial wage increases. That is, they never answer the most important question of all, posed above: Where will the $5 billion in additional annual wages from the 18 minimum wage hikes next year come from?

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So why is raising the minimum wage different from the “broken glass fallacy”?

“We, The Sheeple” can’t think their way out of a paper bag!

Argh!

Watch the poverty increase!

For everbody.

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Healthy Convergence 
CVS is in talks to buy Aetna for more than $66 billion, as the drugstore giant works to fortify itself against looming competition from Amazon while the health-care industry undergoes a reordering. In a sign of the seriousness of the talks, the companies’ chief executives have met multiple times over a period of roughly six months. CVS has made a proposal to buy the health insurer for more than $200 a share. With Aetna, CVS could lock in a huge number of members for its pharmacy-benefit management arm, as well as customers for its drugstores. That could bolster its leverage in negotiations with drugmakers, while its oversight of health insurance could improve its ability to strike new deals that tie drug prices to patient outcomes. If a deal were to be struck, it would be the year’s largest.

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Wow, pretty stunning!

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https://www.theguardian.com/technology/2017/oct/10/american-trucker-automation-jobs

End of the road

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“Labor accounts for 75% of the cost of transporting shipments by truck, so adopters can begin to realize those savings. Beyond that, while truckers are prohibited from driving more than 11 hours per day without taking an eight-hour break, a driverless truck can drive for the entire day. This effectively doubles the output of the trucking network at a quarter of the cost. That’s an eight-times increase in productivity, without taking into account other benefits gained by automation,” he says.

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Clearly, that efficiency will lower the prices of goods and services.

The human cost to individuals will be catastrophic.

As Jason Stapleton keeps saying: “You must invest in your own human capital.” 

The job you have today may not exist in a decade; adapt or die.

And, politicians and bureaucrats or “unions” can’t stop the “eight times increase in productivity”.

Sigh!

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https://www.garynorth.com/public/17188.cfm

The Economics of Assistant Coaches’ Bribery
Gary North – September 28, 2017

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There is a fundamental rule of economics: unless they are defended by the government, cartels always break down. They can be sustained only by government intervention. The government protects the cartels from members of the cartel who break the rules of the cartel in order to increase market share and thereby increase net income. The government makes cartel-busting a crime. In the case of the movie and also in the case of the latest scandals, net income is really what it is all about.

What we are seeing is the intervention of governments around the country to defend the NCAA’s cartel. If it were not for government intervention to keep coaches from paying full ticket for the valuable services of the best players, major universities would be forced to pay millions of dollars to these players, just as professional sports teams have to pay their players. A free market would prevail.

Top collegiate basketball coaches today are paid multimillion-dollar salaries. The head coaches don’t want to lose this income. In contrast, assistant coaches are not paid huge salaries. They are tempted to do under-the-table deals that are against the financial interests of the NCAA’s cartel. None of the coaches being accused of bribery is a head coach. No head coach is going to risk his $4 million annual salary for penny-ante payoffs to recruit top players.

If we had a free market in college education, there would be no legal restriction on the use of the word “college” or “university” imposed by any state on profit-seeking educational ventures. There would be no government money used to build sports stadiums. There would be open entry. Private college tuition would fall at all but the premier schools. College athletes in the top-ranked sports universities would be paid full ticket.

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Ignoring for the moment that these alleged “bribery” charges may not — or should not be — considered  accurate, why do we have cartels in sports?

Why are the Taxpayers funding sports stadiums?

Why are the Team Owners (i.e., “State Universities”) allowed to keep “indentured servants” working (i.e., playing games) for them?

Argh!

We need to get the Gooferment out of all of there!

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https://www.bloomberg.com/view/articles/2017-06-19/the-kansas-supply-side-experiment-unravels

ECONOMICS
The Kansas Supply-Side Experiment Unravels
Tax cuts were supposed to spur growth, boost revenue and create jobs. The results were the exact opposite.
By Barry Ritholtz
June 19, 2017, 11:19 AM EDT

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When a governor announces an economic theory as a solution to a state’s fiscal problems, while challenging all comers to observe the results, that’s something I want to pay attention to. And so for the past five years, I have been watching the public-policy experiment in Kansas with great fascination.

With the state legislature now rejecting the governor’s experiment, we can move onto to the next phase: Not recrimination and blame, though there is lots of that going around. Instead, I want to look at how the experiment played out, and what lessons there are to be learned from it.

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By just about every measure, Kansas’ economic laboratory experiment is now over, and the results are in. Supply-side tax cuts as executed in Kansas don’t generate more economic growth or create more jobs. They reduce tax revenue and forced the government to cut spending on essential goods and services like roads and schools.

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I don’t think Ritholtz’s analysis goes quite far enough.

He doesn’t consider that “time” in his lessons learned.

It takes more than a generation to get folks to change. So a quick tax slashing with a large deficit spend is not how to spur the growth promised in the Laffer curve. It takes time to adapt.

Hence, the tax rate needs to be gently reduced over time with cutting waste and abuse. Then, strategic complete cuts to programs that are ineffective, and inefficient. With those savings either “banked for a rainy day” or returned to the taxpayer.

A one trick pony shot is not going to “fix” the decades of “training” that “We, The Sheeple” have in what Gooferment will do for them. 

Rigorous fiscal discipline, while not showy, will bring prosperity. 

IMHO this is needed at all layers of Gooferment.

Sad to say, but at one time, it could be found in both parties. Not any more in either.

Argh!

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FROM THE WSJ

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TALKING POINTS
Tax talk. President Trump has ordered aides to draft a tax plan that slashes the corporate tax rate to 15%, even if that means a loss of revenue and exacerbating the plan’s procedural and partisan hurdles. Mr. Trump told his team to “get it done,” in time to release a plan by Wednesday.

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For the life of me, I never understood that “We, The Sheeple” don’t understand what appears to me as “simple economics”.

When taxed, “corporations” have really ONLY two choices — pass them along or go out of business. 

Yes, I know that they could potentially reduce their profits, but let’s examine that concept. As Larry Kudlow says “Profits are the mother’s milk of stocks and the lifeblood of the economy.” When you reduce profits, you send signals to the economy that things are bad here. Then, the flow of capital dries up. Eventually, profits are zero and there is no incentive but to shut down.

So, taxes get passed along to the consumer. Lucky, real people get to pay MORE taxes.

What’s really bad is those taxes are HIDDEN in the priced of stuff we buy. Pick up any can of beans and tell me how much of that cost is taxes. It can’t be done. Argh! And, the politicians and bureaucrats just love it that way.

Then, want to know why corporations move overseas? The US tax rate on corporations is 30%. I think that’s the highest in the world. There’s the incentive to move. And, if you can’t move, that’s a reason to not go into business. 

Argh! Cubed!!!

Wake up people. The correct corporate tax rate is ZERO! Make the people aware of how much Gooferment really is costing us.

Argh!

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