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Politics and Economics
This post is not about tax rates. Higher tax rates don’t necessarily translate into additional tax revenue, because tax rates interact with economic behavior in complicated ways. That discussion is for another post. This post is about how to use the gift of extra tax revenue.
Spectrem Group, a wealth management research firm, conducts a semi-annual survey of 750 millionaires for CNBC, aka the “CNBC Millionaire Survey”. The latest survey asked respondents whether they supported Elizabeth Warren’s wealth tax proposal.
Not counting Switzerland, the average US household is less tax-burdened than the average household in the other countries….But tax rates give an incomplete picture of a country’s tax system. We also have to look at tax revenue as a portion of the whole economy:
Now for the pricing plan. HUD already has rent-subsidy programs that cover up to a third of rent. The big California cities also provide rent subsidies. For instance, in the opening quote, Major Breed’s rent subsidy plan worked out to $6,000 per year per housing unit. That’s pretty reasonable. But subsidizing residential hotel units would be even cheaper. Check it out…
Consider: San Francisco had 65,000 residential hotel units in 1910, compared to around 19,000 units today. These were teeny rooms (typically 8 x10 feet) with barely enough space for a bed and a dresser (bathroom down the hall) but at least they offered shelter and safety from the streets. Many of the individuals who lived in these units were single men with problems that plague the chronically homeless today: substance abuse, mental illness, disability. Just like today.
The difference is they had a place to stay.
Empathy is also associated with ingroup bias and outgroup antagonism. One is more likely to feel the joys and sorrows of some people more than others, especially if they’re the same ethnicity.
Per the US Bureau of Labor Statistics, there were 195,530 chief executives in 2018, with a mean annual salary of $200,140. That doesn’t seem unfairly high, given that the mean annual compensation for physicians in 2018 was $299,000. But the CEO pay that gets people riled up isn’t what run-of-the-mill chief executives get, it’s the CEOs pulling in millions working for the top companies. For instance, the $14 million average annual compensation paid to S&P 500 CEOs…
The basic theme in these stories is that college has become so expensive that students increasingly rely on loans to fund their education and the resulting burden of student debt has kept millennials from realizing the American Dream of home ownership and wealth accumulation…. I decided to investigate the matter further.
I’m going to concentrate on cutting health insurance spending, which consumes 75% of US healthcare expenditures: a whopping 2.6 trillion dollars a year. Some considerations…
RAND Corporation analyzed the cost of hospital care across 25 states and found that hospitals, on average, charged the privately insured 2.4 times what they charge Medicare patients. A separate study by West Health found that private insurers paid California hospitals more than two times as much as Medicare paid for similar services. Private non-profit hospitals charged the most for privately insured patients.
Note that economic freedom and government regulations are perfectly compatible, as long as the regulations are “necessary to protect and maintain liberty itself”. Of course, that wording invites a whole slew of questions, such as…
Moral outrage makes ends absolute: This must stop! That must happen! No ifs, ands, or buts…. Governing wisely is about setting priorities, a process that assumes scarcity: the principle that valued ends require scarce resources with alternative uses.
Quick to label and condemn, today’s paranoids seem to have a quasi-religious concept of irredeemable souls - souls that must be cast out of society because nothing good comes from commerce with the devil.
According to the Social Security Administration, 3.1 million undocumented immigrants paid Social Security taxes in 2010, about half the undocumented workers in the country at the time….
According to the above quote, bigotry, addiction, and violence are responsible for rising social instability. So how are bigotry, addiction, and violence trending?
Think about it: around 10% of non-elderly Americans are uninsured. That’s almost 28 million people. But US healthcare costs could be 25% lower if the above reforms were implemented. Then the US would have a healthcare system where everyone is covered and everyone’s paying less.
The problem: chronic homelessness, defined as being without housing for at least a year. It’s estimated that almost a third of the homeless are chronically homeless.
The mission: Figure out a way to house the roughly 10,000 chronically homeless in the San Francisco Bay Area.
A possible solution: …
According to the Bay Area Council Economic Institute, there are roughly 28,200 homeless people in the California’s nine-county Bay Area, which includes San Francisco, Oakland, and San Jose. Extrapolating from previous research, I’m guessing about a third of these individuals are chronically homeless, defined as being without housing for at least a year. This is a tough bunch to help: between mental illness, physical disability, substance abuse, lack of social skills, a fierce independent streak, and/or neurocognitive disorganization, the chronically homeless are often unable to live normal, productive lives. No, most of these folks can’t “just get a job”.
Leniency is called for when an individual is at low-risk for reoffending and there is no need to “make an example” of the person to deter others from engaging in the same criminal behavior.
Prospective employers often use course grades and GPA as a proxy for likely job performance. Grades reflect self-control and conscientious more than intelligence. Self-control and conscientiousness predict an ability to persist on tasks and complete projects. Employers like that.