Sunday, October 21, 2012

It's that time of year again

... where I take a long weekend away, usually at a retreat center (which is also usually Catholic; they are so much more contemplative than Protestants and design these facilities accordingly), and think about the year just past, as well as about the year ahead.  I try to pick the weekend closest to my birthday, so that I can do this in the context of another year of my life going into the books - was it a good year?  Can next year be better?

So this time, I am heading SouthWest instead of my more usual NorthEast.  Creighton University, a good Jesuit school, has a retreat center about 2 hours away, and supposedly some nice wooded grounds.  It's kinda remote, apparently, too; the nearest McDonald's is 30 miles away.  I wonder if I'll get cell phone signal???  (Now in theory that question shouldn't matter a lick.  But... of course it sort of does.)

But anyway, I have my reading stack selected, my mental/ emotional/ spiritual health checklist ready, and my trusty ukulele for chord fingering practice.  So Friday morning it's back to nature, to find some solitude and practice some contemplation, along with a little self-evaluation.  I hope to be able to assign myself a passing grade.  :)


Saturday, October 13, 2012

Out in the tails of the Bell Curve

Dear reader, you are surely aquainted with the Standard Normal distribution (otherwise known as the "Bell Curve").  It is useful in many statistical applications, including some of the social sciences.


When applied to things like the political landscape (where for instance the political left and political right can be represented by the part of the x-axis on either side of the center, that 50% mark at the peak of the curve), it explains why there are so few true "undecided voters" (the further from the middle, the less likely you are to switch sides), and why the "undecideds" decide so many elections (they are the closest to the middle and have the least distance to move).  But it also explains why they are so very difficult to motivate and keep engaged in the political process.

The 2/3 or so in the middle (shown in red as +/- one standard deviation) are the agreeable uninvolved who simply go along, whether blissfully or grumbling as they go; they may have an opinion, but either way they are able to live with whatever the majority decides.

The next quarter (in green, split roughly 13% on either side) are the disagreeable activists, those who "do not go gentle into that good night", but rant and rave and try actively to change things (usually falling short, since this is a social "system", a process, after all, and lone individuals can rarely change a larger social process).

The remaining 5% (the 2+% percent of people on each end of the curve), are the true outliers, the fringe, the pathological disrupters, creative geniuses, anarchists, crusaders, megalomaniacs & visionaries who actually DO change the world - for good or for ill.

Change the definition of the x-axis, and the same principle applies.  Make one half of the bell curve stand for the degree of collectivism / statism, and the other side the degree of libertarianism / individualism, that a person desires; the same descriptions hold true.  The Ayn Rands have their followers out there in the "tail" on one end, and the Mao & Lenin types have theirs in the other "tail".  Most are in the middle wishing the government wasn't so intrusive in their lives, but also wanting the government to fix more of their problems, etc.  The 2/3 in the middle mostly just go along, the 5% in the tails are the lightning rods, fanatics and magnets that draw the discontented (in the green) away from the middle and toward their wild ideas.

Which are you closer to... the agreeable middle?  Or the fringe?

Wednesday, October 03, 2012

Political Statement of Principles

Here's a set I endorse, at least when it comes to government:


Campaign For Liberty 

Statement of Principles

Americans inherit from our ancestors a glorious tradition of freedom and resistance to oppression.  Our country has long been admired by the rest of the world for her great example of liberty and prosperity—a light shining in the darkness of tyranny.
But many Americans today are frustrated.  The political choices they are offered give them no real choice at all.  For all their talk of “change,” neither major political party as presently constituted challenges the status quo in any serious way.  Neither treats the Constitution with anything but contempt.  Neither offers any kind of change in monetary policy.  Neither wants to make the reductions in government that our crushing debt burden demands.  Neither talks about bringing American troops home not just from Iraq but from around the world.  Our country is going bankrupt, and none of these sensible proposals are even on the table.
This destructive bipartisan consensus has suffocated American political life for many years.  Anyone who tries to ask fundamental questions instead of cosmetic ones is ridiculed or ignored.
That is why the Campaign for Liberty was established: to highlight the neglected but common-sense principles we champion and reinsert them into the American political conversation.
The U.S. Constitution is at the heart of what the Campaign for Liberty stands for, since the very least we can demand of our government is fidelity to its own governing document.  Claims that our Constitution was meant to be a “living document” that judges may interpret as they please are fraudulent, incompatible with republican government, and without foundation in the constitutional text or the thinking of the Framers.  Thomas Jefferson spoke of binding our rulers down from mischief by the chains of the Constitution, and we are proud to follow in his distinguished lineage.
With our Founding Fathers, we also believe in a noninterventionist foreign policy.  Inspired by the old Robert Taft wing of the Republican Party, we are convinced that the American people cannot remain free and prosperous with 700 military bases around the world, troops in 130 countries, and a steady diet of war propaganda.  Our military overstretch is undermining our national defense and bankrupting our country.
We believe that the free market, reviled by people who do not understand it, is the most just and humane economic system and the greatest engine of prosperity the world has ever known.
We believe with Ludwig von Mises, Henry Hazlitt, and F.A. Hayek that central banking distorts economic decisionmaking and misleads entrepreneurs into making unsound investments.  Hayek won the Nobel Prize for showing how central banks’ interference with interest rates sets the stage for economic downturns.  And the central bank’s ability to create money out of thin air transfers wealth from the most vulnerable to those with political pull, since it is the latter who receive the new money before the price increases it brings in its wake have yet occurred.  For economic and moral reasons, therefore, we join the great twentieth-century economists in opposing the Federal Reserve System, which has reduced the value of the dollar by 95 percent since it began in 1913.
We oppose the dehumanizing assumption that all issues that divide us must be settled at the federal level and forced on every American community, whether by activist judges, a power-hungry executive, or a meddling Congress.  We believe in the humane alternative of local self-government, as called for in our Constitution.
We oppose the transfer of American sovereignty to supranational organizations in which the American people possess no elected representatives.  Such compromises of our country’s independence run counter to the principles of the American Revolution, which was fought on behalf of self-government and local control.  Most of these organizations have a terrible track record even on their own terms: how much poverty have the World Bank and the International Monetary Fund actually alleviated, for example?  The peoples of the world can interact with each other just fine in the absence of bureaucratic intermediaries that undermine their sovereignty.
We believe that freedom is an indivisible whole, and that it includes not only economic liberty but civil liberties and privacy rights as well, all of which are historic rights that our civilization has cherished from time immemorial.
Our stances on other issues can be deduced from these general principles.
Our country is ailing.  That is the bad news.  The good news is that the remedy is so simple and attractive: a return to the principles our Founders taught us.  Respect for the Constitution, the rule of law, individual liberty, sound money, and a noninterventionist foreign policy constitute the foundation of the Campaign for Liberty.


Tuesday, October 02, 2012

One Dollar, One Vote (more or less)

When Mitt Romney made his candid remarks awhile back about the "47%" of voters who pay no taxes, he was partly right and partly wrong.  Not all of "those people" are wards of the state, lack ambition, see themselves as victims, and refuse to take responsibility for themselves.  Some fit that description, sure.  But not all 47%.  However, what they all definitely do NOT do is... pay taxes.  It seems to me that there does need to be some recognition that those who provide the funding for government services should have a greater say in the management and disposition of those government services than those who provide no funding for them whatsoever. 

I propose a system of popular voting for political office in this country that rewards tax-paying as much as it rewards citizenship.  To lay the groundwork for this system, here are a few pertinent statistics:

       296,000,000 total population of US in 2005
       135,000,000 filed an income tax return in 2005  
                            (46% of total US population)
       100,000,000 paid (a tax obligation) in 2005
                            (34% of total US, 74% of filers)
935,000,000,000 federal income tax paid in 2005     
                            ($9,350 average paid tax obligation)

       299,000,000 total population of US in 2006      
                            (1% annual growth)
       225,000,000 voting age population in 2006       
                            (75% of total)
       208,000,000 eligible voters in 2006                   
                            (92% of voting age, 70% of total)
         86,000,000 actual turnout in 2006
                            (41% of eligible, 29% of total pop.)

Oh, and in case you doubt that 47% of voters pay no taxes, just compare the 100M above who did, vs the 208M of eligible voters, and you get... 48%.  Adjusting for a year's worth of population growth between '05 and 06, and it's 47%.  So there you go.

In finding this collection of statistics, I found it staggering that less than 30% of the people in this country actually determine who runs the place.  My proposal would increase that participation, especially among tax-PAYers... who often seem to be at the heart of complaints about the system.  The idea would be to give tax-PAYers some kind of additional voting shares based on how much they actually pay in taxes.  Eligible voters would still get their normal vote to use whether they paid any taxes or not, so no change there.  But zero taxes paid = zero additional voting shares.  And lots of taxes paid = lots of additional voting shares. 

Looking at the Federal system only for the time being, from the data above, the average tax paid amounts to roughly $9,350 per tax-PAYer (someone who really paid income taxes, not who simply filed to get a refund/credit).  For easier math, let's call it $10,000 for an average tax payment.  Since that's an average, there are definitely some people above and some below that average, so let's divide that amount in fourths to get a baseline "tax voting share" figure of about $2,500.  That way we can distinguish a bit among those folks who do pay less than the average. 

In this scheme, then, anyone who pays even a dollar in net taxes after deductions and credits gets one "tax voting share" (TVS).  Then once you reach $2,501 in paid taxes, you get two "TVS's".  Between $5,001 - $7,500 tax paid, you get three; at $7,501 you get 4, etc.  Since $935B was paid in total, if you divide that into these equal "tax voting shares", you would get $935Bn / $2,500 = 374,000,000 tax voting shares to distribute among the 100,000,000 people who paid a tax obligation.  That is roughly 3.7 TVS's per tax-PAYer.  To make the math a little easier, let's round that to 4 shares on average; of course some tax-PAYers will only get one TVS, others will get many. 

To be sure that tax-PAYers do not have an advantage over normal eligible voters, we then have to dilute the overall value of those TVS's to match the level of eligible voters.  In this rough example, it would be approximately 400M voting shares compared to a little over 200M eligible voters, or a dilution to about 50% of the value of a "regular vote".  So a TVS would be worth only 1/2 of an eligible voter's normal vote, but there will be two times more of them allocated out to the tax-PAYers, so that their overall weight is equal.  Thus, a tax-PAYer who pays $5,000 in federal income taxes (net of all deductions, etc.) would get 5,000 / 2,500 = 2 TVS's, which in total would be worth 2 x 0.5 = 1 vote. 

Think of TVS's as a Common Stock issue vs the regular eligible voter having the Preferred Stock series.  Over time, the value of a TVS will fluctuate with the level of Federal Income Taxes paid and the number of people who pay it.  But the regular eligible "citizen voter's" vote value will always be 1.  And, the total value of TVS's issued will never exceed the total value of regular votes that are made available to eligible voters, so that the "tax share" voters could never outvote the regular eligible voter population, assuming their turnout is the same.  Note, I say votes "made available", not "votes cast".  Some of those regular votes will go unused, in the same way that some TVS's will not be redeemed, either.  In either case if an eligible voter, or a holder of TVS's, chooses not to go to the polls... that's their decision.  But the votes and shares available won't change based on turnout - only the usage of them will.  You don't use 'em... you lose 'em.

FAQs

Q.  Doesn't this mean that an eligible voter who is also a tax-PAYer will get their vote(s) counted twice? 

A.  Yup.  Well... not exactly twice.  Twice if the tax-PAYer sent $5,000 to the federal government in income taxes.  Only 1.5 times if you paid in $1 - $2,500.  Potentially a lot more than twice if you paid in a lot more in taxes.

Q.  So what happened to the "one man, one vote" principle?

A.  Well, at one time, that really did mean man.  Not woman.  And for that matter, white man.  Not any other kind.  And before that it really meant landowner (and still does in the House of Lords in jolly old England).  So, "one man, one vote" has meant different things at different times.  I'm suggesting it's time for another revision.

Q.  And just what would you call this principle?

A.  I'd call it the principle of Proportional Progressive Accountability.  The people who fund the government get more of a say in it than those who don't.  And those who fund it more get more say than those who fund it less.

Q.  How is this fair, again?

A.  In a corporation, a large stockholder has more influence than a small one.  At some point, he/she can even demand a seat on the board, or can band together with other large stockholders and wage a proxy battle to remove the board altogether and replace it with a new slate.  Why can they do this?  Because the consequences of the decisions made by that board and that corporation flow straight to their wallets.  There is more impact from bad decisions on the value of shareholders' equity than on directors and officers' compensation.

Directors and officers (read: elected politicians and political appointees), should serve at the pleasure of the shareholders (read: tax-PAYers).  After all, they are the ones who provide the corporation (read: government) with capital (read: tax income), and put their own finances at risk to do so (think: government debt).  The more capital at risk, the more say they should have in how the business runs, and who runs it on their behalf.

Q. So how much say would Warren Buffet get in this arrangement? How many votes?

A. Only one vote, silly. Same as the rest of us. TVS's, though... that's another matter. Let's see... last time I looked, he paid about $7M in taxes. That translates into 7,000,000 / 2,500 = 2,800 TVSs, which are equivalent to 1,400 regular votes. Let's call these Tax Equivalent Votes (TEVs). So old Warren would have the voting power of 1,401 non-tax-paying but otherwise eligible voters. Would that sway the presidential election? Hardly. 1,401 voters is only 0.000016 of those who actually cast ballots in 2006.  Mitt Romney would wind up with 600ish TEVs.  Obama would have 360 TEVs to cast. The financial elite would NOT rule the world, if that worries you.  But the tax-PAYers might feel like they are getting a fairer shake for their financial contibution to this business of government.

Q.  How would this work on a state and local level?

A.  It would be same principle, but based on the amount of state income taxes paid (for state elections), or local property taxes paid (for city/county elections), adjusted for the number of people paying those taxes and the number of eligible voters in that state or county.  All of this tax paying information is public record and could easily be fed to voter rolls at polling places so that poll workers know how many ballots to give to Julie Brown vs to John Smith when they walk into their local precinct on election day. 

Q.  Could a Warren Buffet sway a local election?

A.  Perhaps.  Depends on his share of those local taxes.  But you would expect that one influential person could have more effect on a local race than a national one, right?

Q.  What about corporations and corporate taxes?

A.  Corporations are not voters.  They're out.  Period.
Who links to my website?