Category Archives: Economist Dan Mitchell

Public schools need more competition and vouchers is the answer

Public schools need more competition and vouchers is the answer.

Related posts:

I expressed pessimism a few days ago about the possibility of replacing the corrupt internal revenue code with a flat tax. Either now or in the future.

But that’s an exception to my general feeling that we’re moving in the right direction on public policy. I’ve shared a list of reasons to be optimistic, even on issues such as  Obamacare and the Laffer Curve.

Education is another area where we should be hopeful. Simply stated, it’s increasingly difficult for defenders of the status quo to rationalize pouring more money into the failed government education monopoly. To paraphrase Winston Churchill, never has so much been spent so recklessly with such meager results.

That’s true regardless of whether Democrats are throwing good money after bad or whether Republicans are throwing good money after bad.

Fortunately, a growing number of people are realizing that the answer is markets and competition. School Choice CartoonThat’s one of the reasons why we’re seeing progress all over the country. Policy makers have implemented varying degrees of school choice in states such as Indiana, Louisiana, Wisconsin, Colorado, Florida, Arizona, and even California.

Is this having a positive impact on educational outcomes and other key variables? The answer, not surprisingly, is yes.

Here are some of the details from a new study published by the Friedman Foundation for Educational Choice.

This report surveys the empirical research on school choice. …the empirical evidence consistently shows that choice improves academic outcomes for participants and public schools, saves taxpayer money, moves students into more integrated classrooms, and strengthens the shared civic values and practices essential to American democracy.

The data on academic outcomes surely is the most important bit of information, so let’s specifically review those findings.

Twelve empirical studies have examined academic outcomes for school choice participants using random assignment, the “gold standard” of social science. Of these, 11 find that choice improves student outcomes—six that all students benefit and five that some benefit and some are not affected. One study finds no visible impact. No empirical study has found a negative impact.

And since I want to reduce the burden of government spending, let’s see whether school choice is good news for taxpayers.

Six empirical studies have examined school choice’s fiscal impact on taxpayers. All six find that school choice saves money for taxpayers. No empirical study has found a negative fiscal impact.

Here’s the breakdown of the studies for all the variables.

School Choice Studies

As you can see, it’s a slam dunk, much as a survey of tax research found that nearly 90 percent of academic studies concluded that class-warfare tax policy is destructive.

Some of the tax research was inconclusive, but not a single study supported the notion that higher tax rates are good for growth, much as this new research from the Friedman Foundation didn’t uncover a single study that found negative results from school choice.

So with lots of positive research and no negative research, why would anybody oppose school choice? Unfortunately, politicians like Barack Obama and groups such as the NAACP side with teacher unions, putting political power ahead of progress and opportunity for kids.

P.S. Here’s a video explaining why school choice is better than a government-run monopoly.

P.P.S. There’s also strong evidence for school choice from nations such as Sweden, Chile, and the Netherlands.

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Open letter to Republican Presidential Candidate Mitt Romney on school vouchers

The Machine: The Truth Behind Teachers Unions Published on Sep 4, 2012 by ReasonTV America’s public education system is failing. We’re spending more money on education but not getting better results for our children. That’s because the machine that runs the K-12 education system isn’t designed to produce better schools. It’s designed to produce more […]

Brummett still resistant to vouchers because he wants us to save public schools at all cost

John Brummett in his article, “A new civil rights struggle in Little Rock?” Arkansas News Burea, August 25, 2011, asserted the main role vouchers should have is  “providing new models for regular public schools to emulate, not about replacing regular public schools.” The Heritage Foundation cares nothing about saving the public schools. If the public […]

The Empirical Evidence on School Choice

Milton Friedman on School Vouchers _______________ Just the facts Mam. APRIL 18, 2013 5:17PM School Choice Works By  JASON BEDRICK SHARE The evidence is in: school choice works. Yesterday, the Friedman Foundation for Educational Choice released their third edition of their report “A Win-Win Solution: The Empirical Evidence on School Choice.” The report provides a literature […]

Open letter to President Obama (Part 290) (Vouchers)

Milton Friedman – Public Schools / Voucher System Published on May 9, 2012 by BasicEconomics The Machine: The Truth Behind Teachers Unions Published on Sep 4, 2012 by ReasonTV America’s public education system is failing. We’re spending more money on education but not getting better results for our children. That’s because the machine that runs […]

Open letter to President Obama (Part 287) (on vouchers)

(This letter was mailed before Oct 25, 2012.) President Obama c/o The White House 1600 Pennsylvania Avenue NW Washington, DC 20500 Dear Mr. President, I know that you receive 20,000 letters a day and that you actually read 10 of them every day. I really do respect you for trying to get a pulse on […]

Open letter to President Obama (Part 254) (on vouchers)

The Machine: The Truth Behind Teachers Unions Published on Sep 4, 2012 by ReasonTV America’s public education system is failing. We’re spending more money on education but not getting better results for our children. That’s because the machine that runs the K-12 education system isn’t designed to produce better schools. It’s designed to produce more […]

Listing of transcripts and videos of Free to Choose by Milton Friedman: Episode “What is wrong with our schools?” on www.theDailyHatch.org

Everywhere school vouchers have been tried they have been met with great success. Why do you think President Obama got rid of them in Washington D.C.? It was a political disaster for him because the school unions had always opposed them and their success made Obama’s allies look bad. In 1980 when I first sat […]

Public school staffing has skyrocketed, we must turn to voucher system

Milton Friedman – Public Schools / Voucher System (Q&A) Part 2 Published on May 7, 2012 by BasicEconomics __________ Max Brantley of the Arkansas Times Blog is always critical of the voucher system but has he taken a closer look at what has been going on in the public schools the last few decades with […]

 

Moocher’s Hall of Fame is a hall of shame

 

The Dangers of Government Dependency

 

Published on Jun 10, 2012

This video from the Center for Freedom and Prosperity Foundation contrasts the dependency mentality in the President’s “Life of Julia” campaign with the traditional American approach of self reliance and individual achievement.

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Moocher’s Hall of Fame is a hall of shame.

Back in 2010, I posted a “Moocher Index” showing the states with the most dependency. But that was based on numbers and lacked any human-interest angle.

So let’s create a Moocher Hall of Fame for the individuals who best exemplify the culture of loafing, laziness, and dependency that is being subsidized by our vote-buying political class.

But you don’t receive this honor simply by accepting other people’s money. Membership in the Moocher Hall of Fame is reserved for deadbeats who demonstrate some special characteristic that warrants their induction.

* Let’s start with Olga, a Greek woman who earned membership in the Hall of Fame because she protested against the notion that she should be responsible for her own life since she might have to – gasp! – work more than one job and live at home.

* Another proud member of the Hall of Fame is Stanley, who was a shoo-in for the honor after it was learned that this 30-year old man has been scamming disability checks from the government so he can fulfill his fetish of wearing diapers and being an “adult baby.”

* Leroy entered the Hall of Fame after it was reported that he won $2 million from the lottery, but somehow is still collecting food stamps.

* A welfare mother with 11 kids in the United Kingdom was invited into the Hall of Fame after one of her sons was arrested for looting and she said “the riots are because the government does “f*** all” for children.”

* If the Hall of Fame had an award for going above and beyond the call of loafing, then Hans from Austria would be an obvious choice. He cut off his own foot to ensure continued handouts.

* We also have a husband-wife team in the Hall of Fame. Alicia and Matthew were unanimous inductees after it was revealed that they tried to impregnate a 12-year old girl to increase their welfare payments.

* Speaking of husband-wife duos, let’s not forget Danny and Gina, who bragged that it didn’t make sense for them to work when the government was providing them with enough loot to enjoy an apartment, a big flat-screen TV, and 40 daily cigarettes.

* Abdul from Australia is an esteemed member of the Hall of Fame’s terror wing, having received 19 years of welfare while plotting to kill the people who were paying for his life of leisure.

* Keeping with that theme, let’s also recognize Anjem, who got elected to the Hall of Fame for collecting about $40,000-per year in handouts while spewing hate and recruiting other “fanatics to copy him by going on benefits.”

* Last but not least, we have Natalijia, a Lithuanian woman who in now enjoying foreign holidays and designer clothes thanks to the generosity of British taxpayers, but nonetheless complained that she wasn’t getting a taxpayer-financed nanny.

Quite a collection of scroungers.

But I don’t think they’re very bright. They wanted to invite Julia to be the speaker at this year’s induction ceremony, apparently not realizing that she was a make-believe cartoon character created by the Obama campaign to celebrate dependency.

Perhaps they should ask Obama to speak. After all, more people have latched on to the disability system during his presidency than have gotten jobs. Quite an achievement…of sorts.

But I’m digressing. The purpose of this post is to announce the newest member of the Moocher Hall of Fame.

Our proud new bum comes from Denmark. Lazy RobertKnown as “Lazy Robert,” he’s been mooching off the taxpayers for 12 years and he’s very proud of his lifestyle. Here are some inspirational details from a New York Times report.

Robert Nielsen, 45, made headlines last September when he was interviewed on television, admitting that he had basically been on welfare since 2001. Mr. Nielsen said he was able-bodied but had no intention of taking a demeaning job, like working at a fast-food restaurant. He made do quite well on welfare, he said. He even owns his own co-op apartment. …Mr. Nielsen, called “Lazy Robert” by the news media, seems to be enjoying the attention. He says that he is greeted warmly on the street all the time. “Luckily, I am born and live in Denmark, where the government is willing to support my life,” he said.

The story also mentions another Danish moocher. Her story is worth sharing because it shows how the folks riding in the wagon enjoy higher living standards than many of those pulling the wagon.

Visit a single mother of two on welfare, a liberal member of Parliament goaded a skeptical political opponent, see for yourself how hard it is. It turned out, however, that life on welfare was not so hard. The 36-year-old single mother, given the pseudonym “Carina” in the news media, had more money to spend than many of the country’s full-time workers. All told, she was getting about $2,700 a month, and she had been on welfare since she was 16.

This probably doesn’t bode well for Denmark’s future. As illustrated by this famous set of cartoons, this kind of system creates very perverse incentives.

By the way, I decided that Carina didn’t deserve membership in the Hall of Fame because at least she has the decency to be ashamed. Or at least that’s one I’m assuming since the story says she “will no longer give interviews.”

But there are some people who genuinely deserve something, and those folks are the taxpayers of Denmark. They deserve our sympathy. They have one of the world’s most oppressive tax systems, thanks in part to a welfare system that provides a comfortable hammock for Robert and Carina.

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wrote about Julia the Moocher earlier this month, linking the Obama campaign’s make-believe leech with a real-world Greek woman who thought the government should take care of her.

I also shared an amusing parody of Julia by Iowahawk (the creator of the famous Pelosi car commercial).

Now Michael Ramirez has weighed in, producing a great cartoon about Obama’s dream woman.

Needless to say, Julia is the type of person who believes in riding in the wagon rather than pulling it. Heck, she wants the wagon to be a party bus, as suggested by this cartoon about the rise and fall of the welfare state.

My daughter’s given me a few gray hairs, but thankfully she didn’t turn into a slug like Julia.

P.S. Some of my favorite Ramirez cartoons can be seen herehere,hereherehereherehereherehere, and here.

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Related posts:

What does the welfare state do to people?

I have posted stories on welfare before and here is another one. Another Horrifying and Depressing Look at the Human Cost of the Welfare State March 22, 2013 by Dan Mitchell When we think of Julia, the mythical moocher created by the Obama campaign, our first instinct is probably to grab our wallets and purses. After […]

The Welfare trap can be destroyed by Milton Friedman’s negative income tax

The best way to destroy the welfare trap is to put in Milton Friedman’s negative income tax. A Picture of How Redistribution Programs Trap the Less Fortunate in Lives of Dependency I wrote last year about the way in which welfare programs lead to very high implicit marginal tax rates on low-income people. More specifically, they […]

Julia is a scumbag

Real Time with Bill Maher March 16 2012 – Alexandra Pelosi Interviews Welfare Recipients in NYC Published on Mar 18, 2012 by vclubscenedotcom Real Time with Bill Maher March 16 2012 – Alexandra Pelosi Interviews Welfare Recipients It is truly sad to me that we have got to such a low point in our country […]

Open letter to President Obama (Part 284)

  President Obama c/o The White House 1600 Pennsylvania Avenue NW Washington, DC 20500 Dear Mr. President, I know that you receive 20,000 letters a day and that you actually read 10 of them every day. I really do respect you for trying to get a pulse on what is going on out here. On […]

Scholars react to President Obama’s 2013 State of the Union Speech Part 7 “Balance” in Obamaspeak

State of the Union 2013 Published on Feb 13, 2013 Cato Institute scholars Michael Tanner, Alex Nowrasteh, Julian Sanchez, Simon Lester, John Samples, Pat Michaels, Jagadeesh Gokhale, Michael F. Cannon, Jim Harper, Malou Innocent, Juan Carlos Hidalgo, Ilya Shapiro, Trevor Burrus and Neal McCluskey respond to President Obama’s 2013 State of the Union Address. Video […]

President Obama’s “You-Didn’t-Build-That” comment misses the mark because only 10% of the federal budget pays for public goods when the rest is actually harmful to the economy (Cartoons)

I have put up lots of cartoons from Dan Mitchell’s blog before and they have got lots of hits before. Many of them have dealt with the economy, eternal unemployment benefits, socialism,  Greece,  welfare state or on gun control.  President Obama’s “You-Didn’t-Build-That” comment misses the mark because only 10% of the federal budget pays for public goods when the […]

Scholars react to President Obama’s 2013 State of the Union Speech Part 6 State of the…Climate?

State of the Union 2013 Published on Feb 13, 2013 Cato Institute scholars Michael Tanner, Alex Nowrasteh, Julian Sanchez, Simon Lester, John Samples, Pat Michaels, Jagadeesh Gokhale, Michael F. Cannon, Jim Harper, Malou Innocent, Juan Carlos Hidalgo, Ilya Shapiro, Trevor Burrus and Neal McCluskey respond to President Obama’s 2013 State of the Union Address. Video […]

Scholars react to President Obama’s 2013 State of the Union Speech Part 5 Infrastructure “Investments” Don’t Deliver On Promises

State of the Union 2013 Published on Feb 13, 2013 Cato Institute scholars Michael Tanner, Alex Nowrasteh, Julian Sanchez, Simon Lester, John Samples, Pat Michaels, Jagadeesh Gokhale, Michael F. Cannon, Jim Harper, Malou Innocent, Juan Carlos Hidalgo, Ilya Shapiro, Trevor Burrus and Neal McCluskey respond to President Obama’s 2013 State of the Union Address. Video […]

 

 

 

Putting up to 12% of your income away for private social security system is Australia’s plan

Putting up to 12% of your income away for private social security system is Australia’s plan.

Unexpected Praise for Australia’s Private Social Security System

April 21, 2013 by Dan Mitchell

As part of my “Question of the Week” series, I said that Australia probably would be the best option if the United States suffered some sort of Greek-style fiscal meltdown that led to a societal collapse.*

One reason I’m so bullish on Australia is that the nation has a privatized Social Security system called “Superannuation,” with workers setting aside 9 percent of their income in personal retirement accounts (rising to 12 percent by 2020).

Established almost 30 years ago, and made virtually universal about 20 years ago, this system is far superior to the actuarially bankrupt Social Security system in the United States.

Probably the most sobering comparison is to look at a chart of how much private wealth has been created in Superannuation accounts and then look at a chart of the debt that we face for Social Security.

To be blunt, the Aussies are kicking our butts. Their system gets stronger every day and our system generates more red ink every day.

And their system is earning praise from unexpected places. The Center for Retirement Research at Boston College, led by a former Clinton Administration official, is not a right-wing bastion. So it’s noteworthy when it publishes a study praising Superannuation.

Australia’s retirement income system is regarded by some as among the best in the world. It has achieved high individual saving rates and broad coverage at reasonably low cost to the government.

Since I wrote my dissertation on Australia’s system, I can say with confidence that the author is not exaggerating. It’s a very good role model, for reasons I’ve previously discussed.

Here’s more from the Boston College study.

The program requires employers to contribute 9 percent of earnings, rising to 12 percent by 2020, to a tax-advantaged retirement plan for each employee age 18 to 70 who earns more than a specified minimum amount. …Over 90 percent of employed Australians have savings in a Superannuation account, and the total assets in these accounts now exceed Australia’s Gross Domestic Product. …Australia has been extremely effective in achieving key goals of any retirement income system. …Its Superannuation Guarantee program has generated high and rising levels of saving by essentially the entire active workforce.

The study does include some criticisms, some of which are warranted. The system can be gamed by those who want to take advantage of the safety net retirement system maintained by the government.

Australia’s means-tested Age Pension creates incentives to reduce one’s “means” in order to collect a higher means-tested benefit. This can be done by spending down one’s savings and/or investing these savings in assets excluded from the Age Pension means test. What makes this situation especially problematic is that workers can currently access their Superannuation savings at age 55, ten years before becoming eligible for Age Pension benefits at 65. This ability creates an incentive to retire early, live on these savings until eligible for an Age Pension, and collect a higher benefit, sometimes referred to as “double dipping.”

Though I admit dealing with this issue may require a bit of paternalism. Should individuals be forced to turn their retirement accounts into an income stream (called annuitization) once they reach retirement age?

I’m torn on this issue. Paternalists sometimes do have good ideas, but shouldn’t people have the freedom to make their own decisions, even if they make mistakes? But does the answer to that question change when mistakes mean that those people will be taking money from taxpayers?

Fortunately, I don’t need to be wishy-washy on the other criticism in the study.

Australia’s system does have shortcomings. It is heavily dependent on defined contribution plans and is vulnerable to weaknesses in such programs.

I strongly disagree. A “defined contribution” account is something to applaud, not a shortcoming.

The author presumably is worried that a “DC” account leaves a worker vulnerable to the ups and downs of the market, whereas a “defined benefit” account promises a specific payment and removes that uncertainty. Sounds great, but the problem with “DB” accounts is that they almost inevitably seem to promise more than they can deliver. And that seems to be the case whether they’re supposedly based on real savings (like company retirement plans or pension funds for state and local bureaucrats) or based on pay-as-you-go taxation (like Social Security).

*Since I’m somewhat optimistic that America can be saved, I’m not recommending you head Down Under just yet.

P.S. I’m also a huge fan of Chile’s system of private accounts. At the risk of oversimplifying, Chile’s system is sort of like universal IRAs and Australia’s system is sort of like universal 401(k)s.

P.P.S. There’s much to admire about Australia, but its government is plenty capable of boneheaded policy. Heck, the government even provides workers’ compensation payments to people who get injured while having sex after work hours, simply because they were on a business-related trip. Talk about double dipping!

P.P.P.S. Here’s my video explaining why we should implement personal retirement accounts in the United States.

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Saving Social Security with Personal Retirement Accounts

            Uploaded on Jan 10, 2011

There are two crises facing Social Security. First the program has a gigantic unfunded liability, largely thanks to demographics. Second, the program is a very bad deal for younger workers, making them pay record amounts of tax in exchange for comparatively meager benefits. This video explains how personal accounts can solve both problems, and also notes that nations as varied as Australia, Chile, Sweden, and Hong Kong have implemented this pro-growth reform.   http://www.freedomandprosperity.org

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P.P.P.S. The death tax has been abolished in Australia, so there’s more to admire than just personal retirement accounts.

Two Social Security Cartoons

April 27, 2012 by Dan Mitchell

Since we recently learned Social Security is even more financially decrepit than previously estimated, let’s cheer ourselves up with a couple of cartoons.

This first one is a pretty good assessment of what’s going to happen in a few years if we don’t see reform. Think about what’s happening in Europe, if you don’t have a good imagination.

This cartoon covers the same topic, but looks at how an aging population is going to create unsustainable fiscal demands.

There are solutions, of course, but don’t hold your breath waiting for them to be implemented.

Incidentally, you may recognize the artistic style in the second cartoon. It’s by Ramirez. Here are links to some of his other cartoons that I found especially worthwhile: Here, hereherehereherehereherehere, and here.

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Cartoons from Dan Mitchell’s blog that demonstrate what Obama is doing to our economy Part 3.2  (Two Social Security Cartoons)

I have put up lots of cartoons from Dan Mitchell’s blog before and they have got lots of hits before. Many of them have dealt with the economy, eternal unemployment benefits, socialism,  Greece,  welfare state or on gun control.   Two Social Security Cartoons April 27, 2012 by Dan Mitchell Since we recently learned Social Security is even […]

We got to reform Social Security now!!!

We got to reform Social Security now!!! Yes, We Should “Reform” Payroll Taxes, but only if that Means Personal Retirement Accounts January 2, 2013 by Dan Mitchell Washington is filled with debate and discussion about the economic burden of the federal income tax, which collected $1.13 trillion in FY2012 ($1.37 trillion if you include the corporate […]

“Feedback Friday” Letter to White House generated form letter response July 30,2012 on Social Security (part 16)

I have been writing President Obama letters and have not received a personal response yet.  (He reads 10 letters a day personally and responds to each of them.) However, I did receive a form letter in the form of an email on July 30, 2012. I don’t know which letter of mine generated this response so I have […]

My favorite 10 videos on gun rights and gun control

Gun Control explained

Buy a Shotgun Joe Biden Lying AR-15

Make your own Gun Free Zone

PRK Arms on CBS 47 news,  Fresno

Suzanna Gratia Hupp explains meaning of 2nd Amendment!

Penn and Teller – Gun Control and Columbine

Somebody Picked the Wrong Girl

5 Facts About Guns, Schools, & Violence

I’ve shared some great videos on the Second Amendment and the individual right to keep and bear arms.

Here’s another video for the collection.

And since I’m sharing videos against gun control, let’s close with some humorous examples.

Joe Biden, needless to say, was unintentionally funny.

*Full disclaimer: Given my lack of success in high school, I would have asked any young lady to be my girlfriend.

 Rapper Ice T on US gun control (20July12)

Why Switzerland Has The Lowest Crime Rate In The World

            Uploaded on Nov 15, 2009

When thinking about the mass extermination camps of a holocaust think.. The key to freedom is to be able to have the ability to defend yourself &, if you dont have the tools to do that, then youre going to be at the mercy of whomever wants to put you away. Guns are deeply rooted within Swiss culture – but the gun crime rate is so low that statistics are not even kept. The country has a population of six million, but there are estimated to be at least two million publicly-owned firearms, including about 600,000 automatic rifles and 500,000 pistols. This is in a very large part due to Switzerland’s unique system of national defence, developed over the centuries. Instead of a standing, full-time army, the country requires every man to undergo some form of military training for a few days or weeks a year throughout most of their lives. Between the ages of 21 and 32 men serve as frontline troops. They are given an M-57 assault rifle and 24 rounds of ammunition which they are required to keep at home. Once discharged, men serve in the Swiss equivalent of the US National Guard, but still have to train occasionally and are given bolt rifles. Women do not have to own firearms, but are encouraged to. Update 28th December 2010: Out of nearly 3 million views of this video there are 4358 thumbs up to 427 thumbs down. So, you could say, if any of us lived in any sort of real democracy in this world that would mean that only one in every ten people would like to keep gun control laws. Guess this means that we’re not and that the tyrants still have all the real power.

Tax Freedom Day

President Obama is from Illinois and he is running our nation like the politicians of Illinois run their state with lots of wasteful spending and too many high taxes.

It’s time to celebrate.

That’s because we have reached Tax Freedom Day, meaning that – in the aggregate – we have finally earned enough money to pay for all the federal, state, and local taxes that will be imposed on us this year by our political masters.

But we’re not collectivists, so aggregate measures don’t really matter. Our individual tax burdens can vary considerably depending on the level and composition of our income, as well as the state in which we live.

Speaking of that, the good folks of North Dakota are the only ones actually celebrating Tax Freedom Day on this exact date. If you look at the map, Tax Freedom Day is as early as late March for residents of Louisiana and Mississippi, and as late as May for the unfortunate residents of New York, Connecticut, and New Jersey.

Tax Freedom Day Map

You’ll notice, by the way, that Tax Freedom Day is correlated with average state income. That’s one of the reasons why low-income states tend to get better scores. Simply stated, it’s hard to collect a lot of revenue from people who don’t have much money.

And a state that historically has been wealthy, like Connecticut, will probably collect a lot of revenue even if it has a good tax system (though, for the record, Connecticut has veered dramatically in the wrong direction in the past couple of decades).

So if you want to measure whether a state has a good or bad tax system, I recommend the “fiscal” and “tax burden” categories in the “Freedom Index” from the Mercatus Center. Using that measure, South Dakota gets the best score (compared to the 6th-best score using Tax Freedom Day).

P.S. If you like maps, here are some interesting ones, starting with some international comparisons.

Here are some good state maps with useful information.

There’s even a local map.

 

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Dan Mitchell explains what happened in Cyprus

Dan Mitchell explains what happened in Cyprus.   What Really Happened in Cyprus? April 14, 2013 by Dan Mitchell Did Cyprus become an economic basket case because it is a tax haven, as some leftists have implied? Did it get in trouble because the government overspent, which I have suggested? The answers to those questions are […]

Dan Mitchell on Obamacare (includes cartoons on Obamacare)

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Dan Mitchell’s blog has great cartoon that demonstrates what President Obama has been doing the last 4 years!!!

I have put up lots of cartoons from Dan Mitchell’s blog before and they have got lots of hits before. Many of them have dealt with the economy, eternal unemployment benefits, socialism,  Greece,  welfare state or on gun control.     I’ve Obtained a Secret Pre-Release Copy of Obama’s Budget April 9, 2013 by Dan Mitchell The President is supposed to release […]

Dan Mitchell’s tribute to Margaret Thatcher

Very well said by Dan Mitchell. A Tribute to Margaret Thatcher April 8, 2013 by Dan Mitchell The woman who saved the United Kingdom has died. A Great Woman I got to meet Margaret Thatcher a couple of times and felt lucky each time that I was in the presence of someone who put her nation’s […]

Dan Mitchell, Ron Paul, and Milton Friedman on Immigration Debate (includes editorial cartoon)

I like Milton Friedman’s comments on this issue of immigration   and Ron Paul and Dan Mitchell do well on the issue too. Question of the Week: What’s Your Take on the Immigration Debate? April 7, 2013 by Dan Mitchell A reader from overseas wonders about my views on immigration, particularly amnesty. I confess that this is one of […]

Dan Mitchell on Texas v. California (includes editorial cartoon)

We should lower federal taxes because jobs are going to states like Texas that have low taxes. What Can We Learn by Comparing the Employment Situation in Texas vs. California? April 3, 2013 by Dan Mitchell One of the great things about federalism, above and beyond the fact that it both constrains the power of governments […]

Cartoons from Dan Mitchell’s blog on Obamacare

Third-Party Payer is the Biggest Economic Problem With America’s Health Care System Published on Jul 10, 2012 This mini-documentary from the Center for Freedom and Prosperity Foundation explains that “third-party payer” is the main problem with America’s health care system. This is why undoing Obamacare, while desirable, is just a small first step if we […]

Obamacare cartoons from Dan Mitchell’s blog

I have put up lots of cartoons from Dan Mitchell’s blog before and they have got lots of hits before. Many of them have dealt with the economy, eternal unemployment benefits, socialism,  Greece,  welfare state or on gun control. The funniest cartoon is the one with “Nurse Sebelius” stuffing the huge capsule down the kid’s throat!!! Obamacare […]

Editorial cartoon from Dan Mitchell’s blog on California’s sorry state of affairs

I have put up lots of cartoons from Dan Mitchell’s blog before and they have got lots of hits before. Many of them have dealt with the sequester, economy, eternal unemployment benefits, socialism,  minimum wage laws, tax increases, social security, high taxes in California, Obamacare,  Greece,  welfare state or on gun control. President Obama’s favorite state must be California because […]

Dan Mitchell of the Cato Institute:HUD has to go!!!! (includes political cartoon)

You want a suggestion on how to cut the government then start at HUD. I would prefer to eliminate all of it. Here are Dan Mitchell’s thoughts below: Sequestration’s Impact on HUD: Just 358 More Days and Mission Accomplished March 12, 2013 by Dan Mitchell As part of my “Question of the Week” series, I had […]

People hated tax collectors like Zacchaeus 2000 years ago and they hate them today too!!!

The IRS agents are as well thought of as Zacchaeus who was the tax collector that only Jesus was nice to. Here is a fine article by Dan Mitchell of the Cato Institute. 

For the past 30 or so years, I’ve done my own taxes by hand. I thought this was a good approach because it would help me better understand the practical challenges of the tax code.

Bravest man IRS

Dan Mitchell has dropped out of this contest

But it’s time to confess that I broke down and used Turbotax for yesterday’s tax return.

It’s not that my financial affairs are complicated. I basically get my Cato salary and a bit of income from speeches and articles. But even that became too much of a challenge. The tipping point was the form for Health Savings Accounts. The IRS is yelling at me for how I filled out this form in past years, and I fear that I will be perpetually in their cross hairs without relying on a computer program to avoid mistakes.

To help me deal with yesterday’s traumatic experience, I’m sharing some very good cartoons.

We’ll start with one from Gary Varvel.

IRS Cartoon 1

Sort of the visual version of this letter-to-the-editor.

Our next cartoon, which may be my favorite of the group, is from Glenn McCoy.

IRS Cartoon 2

By the way, if you don’t think the IRS is capable of thuggery, read this horrifying story.

I don’t know Paul Fell’s work, but this next cartoon is a very good introduction.

IRS Cartoon 3

This is the second time the grim reaper has appeared in a cartoon. The first time involved the death tax.

Last but not least, we have a Chip Bok cartoon about tax code complexity.

IRS Cartoon 4

As a bonus, it also features the complexity of Obamacare. If you like cartoons that mix the IRS and Obamacare, check out this classic from Glenn McCoy and this gem by Gary Varvel.

If you still need to be cheered up, here’s some more IRS humor to brighten your day, including the IRS version of the quadratic formula, a new Obama 1040 form, a list of tax day tips from David Letterman, a cartoon ofhow GPS would work if operated by the IRS, an IRS-designed pencil sharpener, a sale on 1040-form toilet paper (a real product), and two songs about the tax agency (here and here),  and a PG-13 joke about a Rabbi and an IRS agent.

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Use of our tax money is pretty stupid

Sad that the government wastes so much of our money and it wants more from us under President Obama.

Remember the Spending Quiz from 2010, which asked people to guess whether absurd examples of government waste were true or false?

Well, we have a new video on government waste, though bureaucrats and politicians have become so profligate it doesn’t even bother to trick people with fake examples.

Your Tax Dollars at Work

While very well done, I do have two small complaints about the video.

First, it asks whether we should cut spending or raise taxes to deal with the national debt. I think that’s too narrow. We shouldn’t be wasting money even if the budget was balanced and there wasn’t a penny of debt.

In other words, the problem isn’t deficits. Red ink is just a symptom. The real problem is that government is too big.

Second, the video sort of acquiesces to the dishonest Washington terminology by asking whether we should cut spending or raise taxes, implying those are the only two options. I favor genuine spending cuts, of course, but the most accurate way of phrasing the question is to ask whether we should cut spending, restrain spending, or let government grow on auto-pilot.

As I explained earlier this year, we can balance the budget in just 10 years if spending grows “only” 3.4 percent per year. When people understand that detail, there’s almost no support for higher taxes.

But I’m nitpicking. Overall, a very good video.

P.S. If the examples of pork-barrel spending in the video get you angry, you’ll probably have a stroke if you also watch the waste video from the folks at Government Gone Wild.

 

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The United Nations is full of gun control nuts (includes gun poster)

 

The United Nations is full of gun control nuts.

 

Citing the analysis of America’s former Ambassador to the United Nations, I wrote last year about a treaty being concocted at the United Nations that would threaten our right to keep and bear arms.

Well, with the aid of the Obama Administration, this new treaty has been approved. Fortunately, there probably are not 67 votes in the Senate to ratify the measure.

And that’s a good thing. The Wall Street Journal has a column by John Bolton and John Yoo explaining why the new U.N . treaty is so misguided and dangerous.

…the new treaty also demands domestic regulation of “small arms and light weapons.” The treaty’s Article 5 requires nations to “establish and maintain a national control system,” including a “national control list.” …Gun-control advocates will use these provisions to argue that the U.S. must enact measures such as a national gun registry, licenses for guns and ammunition sales, universal background checks, and even a ban of certain weapons. The treaty thus provides the Obama administration with an end-run around Congress to reach these gun-control holy grails.

But doesn’t the Second Amendment protect our rights, regardless?

Unfortunately, that’s not clearly the case, as Bolton and Yoo note.

The Constitution establishes treaties in Article II (which sets out the president’s executive powers), rather than in Article I (which defines the legislature’s authority)—so treaties therefore aren’t textually subject to the limits on Congress’s power. Treaties still receive the force of law under the Supremacy Clause, which declares that “This Constitution, and the Laws of the United States which shall be made in Pursuance thereof; and all Treaties made, or which shall be made, under the Authority of the United States, shall be the supreme Law of the Land.” …this difference in language between laws and treaties allows the latter to sweep more broadly than the former.

One thing we can state with certainty is that opponents of individual rights will use the treaty to push an anti-gun agenda inside the United States. And since the Supreme Court has upheld the Second Amendment by only one vote, I’m not overly confident that we can rely on the judiciary anyhow.

Ultimately, our fundamental rights to protect ourselves and our families only exist because politicians are scared of getting voted out of office and losing the best job most of them will ever have.

And remember that the “slippery slope” is a very relevant concern. Many anti-gun activists think only government should have the right to possess guns, and they view incremental gun control measures as building blocks to that ultimate goal.

Even though government monopolies on gun possession have been associated with some of the world’s most brutal dictatorships!

I’m not worried that the United States is going to turn into some Venezuelan-style anti-gun totalitarian regime, so I actually disagree with the results of my poll on the biggest reason to oppose gun control.

If I was asked to give my worst-case scenario for why we need private gun ownership, it would involve fiscal and societal breakdown because of an ever-growing welfare state.

But regardless of why you believe in the Second Amendment, this U.N. treaty would be a very bad development.

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Open letter to President Obama (Part 256) (on gun control)

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Dan Mitchell explains what happened in Cyprus

Dan Mitchell explains what happened in Cyprus.

 

What Really Happened in Cyprus?

April 14, 2013 by Dan Mitchell

Did Cyprus become an economic basket case because it is a tax haven, as some leftists have implied?

Did it get in trouble because the government overspent, which I have suggested?

The answers to those questions are “no” and “to some degree.”

The real problem, as I explain in this interview for Voice of America, is that Cypriot banks became insolvent because they made very poor investment decisions, particularly their purchases of Greek government bonds.

A few additional points.

1. The mess in Cyprus won’t cause problems in other nations, but it may lead investors in other nation to pay closer attention to whether there are problems with the government and/or banking sector.

2. There is not a “European problem” or “euro problem.” Some nations, such as Switzerland and Estonia, have made sound decisions. Others, such as Sweden, Denmark, and Germany, are in decent shape.

3. The final outcome in Cyprus was bad, but probably less bad than other options. The final result surely was better than the corrupt TARP regime in the United States.

4. It is utterly absurd to blame tax havens for the financial crisis. That disaster was caused by mistaken decisions by politicians in Washington.

So what happens now? I fear that Cyprus is going to be like Ireland, a nation that used to have a few attractive policies but now will have a bleak future.

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We got to get a hold on entitlement spending!!!

We got to get a hold on entitlement spending!!!

If America descends into Greek-style fiscal chaos, there’s no doubt that entitlement programs will be the main factor. Social Security, Medicare, Medicaid, and Disability are all fiscal train wrecks today, and the long-run outlook for these programs is frightful.

Just look at these numbers from the Bank for International Settlements and OECD to see how our fiscal future is bleaker than many of Europe’s welfare states.

If we don’t implement the right kind of entitlement reform, our children and grandchildren at some point will curse our memory.

But that doesn’t mean we shouldn’t worry about other parts of the budget, including the so-called discretionary programs that also have been getting bigger and bigger budgets over time.

That’s why I was a bit perturbed to read Veronique de Rugy’s piece in National Review Online, which implies that these programs are “shrinking” and being subject to a “Big Squeeze.”

…there is another number to look at in that budget. It’s the shrinking share of the budget consumed by discretionary spending (spending on things like defense and infrastructure) to make space for mandatory spending and interest. This is the Big Squeeze. …in FY 2014 mandatory spending plus interest will eat up 67 percent of the budget, leaving discretionary spending with 33 percent of the budget (down from 36 percent in FY 2012). Now by FY 2023, mandatory and interest spending will consume 77 percent of the total budget. Discretionary spending will be left with 23 percent of the budget.

But all that’s really happening here is that entitlement outlays are growing faster than discretionary spending.

Here’s some data from the Historical Tables of the Budget, showing what is happening to spending for both defense discretionary and domestic discretionary. And these are inflation-adjusted numbers, so the we’re looking at genuine increases in spending.

Discretionary Spending FY62-14

As you can see, defense outlays have climbed by about $100 billion over the past 50 years, while outlays for domestic discretionary programs have more than tripled.

If that’s a “Big Squeeze,” I’m hoping that my household budget experiences a similar degree of “shrinking”!

To be fair, Veronique obviously understands these numbers and is simply making the point that politicians presumably should have an incentive to restrain entitlement programs so they have more leeway to also buy votes with discretionary spending.

But I’d hate to think that an uninformed reader would jump to the wrong conclusion and decide we need more discretionary spending.

Particularly since the federal government shouldn’t be spending even one penny for many of the programs and department that are part of the domestic discretionary category. Should there be a federal Department of Transportation? A federal Department of Housing and Urban Development? A federal Department of Agriculture?

No, NO, and Hell NO. I could continue, but you get the idea.

The burden of federal government spending in the United States is far too high and it should be reduced. That includes discretionary spending and entitlement spending.

P.S. Since I don’t want to get on Veronique’s bad side, let me take this opportunity to call attention to her good work on properly defining austerity,. And if you watch her testimony to a congressional committee, it’s also quite obvious that she also understands that the real problem is bloated and wasteful government spending.

P.P.S. For those who don’t have the misfortune of following the federal budget, “entitlements” are programs that are “permanently appropriated,” which simply means that spending automatically changes in response to factors such as eligibility rules, demographic shifts, inflation, and program expansions. Sometimes these programs (such as Social Security, Medicare, Medicaid, etc) are referred to as “mandatory spending.”

The other big part of the budget is “discretionary spending” or “appropriations.” These are programs funded by annual spending bills from the Appropriations Committees, often divided into the two big categories of “defense discretionary” and “nondefense discretionary.”

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