Saturday, June 25, 2005
Tuesday, June 21, 2005
Tuesday, June 07, 2005
The Politics of Envy
This is to the NYT from the economist Greg Mankiw, who authors the standard Macroeconomics textbook used in colleges. He now chairs the President's Council of Economic Advisors. He's smarter than you and me - fait attention.
To the Editor:
Your chart about the percentage of income earned by the top 0.1 percent of taxpayers was fascinating, but "Richest Are Leaving Even the Rich Far Behind" failed to draw the obvious conclusions from it.
The data show that the rich take a rising share of income when the economy is booming, such as during the 1920's and 1990's. Their share declines when the economy hits hard times, such as during the Great Depression and the most recent recession.
The rich took their smallest slice of the economic pie during the 1970's - a period when productivity growth was low and unemployment and inflation were rising.
Here's the lesson: If policy makers' primary goal is to reduce income inequality, they should put the economy through the wringer. But if they want economic prosperity for all, they should avoid focusing on the politics of envy.
N. Gregory Mankiw
Monday, June 06, 2005
Class Wars and Too Much Ideology
Still, Bob Herbert's op-ed today pretty much pissed me off. His basic tenet is that, because the rich and ultra-rich have so far distanced themselves in terms of wealth from the lower- and middle-classes, the current system of taxation and wage distribution is inherently unfair and a result of policy that favors corporations (employers) and the wealthy. This to the say that the wealthy do not pay their "fair share" of taxes. The other part of his editorial concerns basic wage growth, saying rather truly:
Revolutionary improvements in technology, increasingly globalized trade, the competition of low-wage workers overseas and increased immigration here at home, the decline of manufacturing, the weakening of the labor movement, outsourcing and numerous other factors have left American workers with very little leverage to use against employers.What is also (more) true here is that these same circumstances have kept inflation at bay, such that real wage growth actually means more. What Herbert also neglects to say, though he has obvious evidence for it, is that the large majority of middle- and lower-class Americans do not move up because they neglect to save. His point:
Many in the middle class are mortgaged to the hilt, maxed out on credit cards and fearful to the point of trembling that all they've worked for might vanish in a downsized minute..The main reason most Americans do not get to live the American dream is because they spend all or more of the money they earn, pursuing one facet of the dream by accumulating lots of stuff. I know I sound like Dave Ramsey, but seriously (and this holds true for the government, too), holding spending in check is absolutely necessary to create prosperity.
So, the increasing wealth of the wealthy is not the problem - they are saving. The decreasing saving of the middle class is, and that's what needs to be encouraged by our leaders.
Sunday, June 05, 2005
I'm back....Who missed me?
Actually, funny story - one of the craps dealers got downright passive-aggressive with my girlfriend. He wouldn't acknowledge her, place or pick up her bets. That is, we had a $5 dealer yo - 11 - bet that paid 15 to 1 for the dealers. The pit boss was also rude to her when she complained. I actually saw another dealer - blackjack this time - make change for $400 and give the player 20 green chips, which is $500. The unfortunate player wanted more red chips and gave them back, at which point she made correct change.
I don't know if it was the casino's bad management or my good luck that I ended up $300+ from video poker and craps. So that was good.
The beaches, pools, and other water attractions are the real centerpiece of the resort. We spent plenty of hours in the mostly cloudy skies (Nashville is much hotter right now than Nassau). Still, I got some good reading in. In the last week I've read:
Betting Thoroughbreds (a graduation gift from my girlfriend's parents)
The Golden Ratio
Blink - Malcolm Gladwell
Harry Potter and the Order of the Phoenix (for the 2nd time; gearing up for July 16th)
The Elegant Universe - Brian Greene
Super System 2 - Doyle Brunson
Each book is excellent in its own right, but the most intriguing right now is Blink, who's author wrote the equally excellent The Tipping Point. You may have noticed from the list that I have a penchant for non-fiction. For some reason, I just don't love fiction that's not of the fantastic variety. I think that the non-fiction describes the world the way it is and fantasy the way our spirit wants it to be. Our hearts want to believe magic is real, even if our heads convince us otherwise.
Hopefully, this week will produce a job and a few beer buzzes. Out.