Mr. Mulligan is a professor of economics at the University of Chicago and the author of “The Redistribution Recession” (Oxford, 2012).
The health-care law, starting Jan. 1, will begin driving up marginal tax rates—well above 50% for many.
A new wave of redistribution will arrive in America on Jan. 1, primarily thanks to the Affordable Care Act. The president’s health-insurance plan forces those who hire, work and produce to pay full price for health care, while creating generous discounts for practically everyone else.
…In the years 2015 and beyond, full-time workers with median incomes will keep only half of the compensation created by their decisions, with the other half going to the government in the form of additional taxes and savings on subsidy payments. By keeping 50% rather than 60%, workers will find that the reward for holding a job will have fallen a damaging 17%
The federal government wants to support the goal of home ownership. But that goal will not be achieved if government subsidies lead home purchasers to default more on their mortgages. So a second goal is to minimize the defaults on home mortgages.
A projected $650 million in welfare benefits will be distributed to illegal alien parents in 2013, county officials said Monday.
Supervisor Michael D. Antonovich announced the latest figures from the Department of Public Social Services, which showed more than $376 million in CalWORKs benefits and food stamps combined have been distributed through July to illegal alien parents for their native-born children.
It’s amazing how little President Obama has learned about economics in his four and a half years in the White House. Growth, incentives, tax reform, tax increases, private investment, the middle class, a second great depression, the sequester—all these issues have one thing in common: Obama doesn’t understand their role in our economy. Nor does he appear interested in finding out.
Congress defined “affordable” as 9.5% or less of an employee’s household income, mostly to make sure people did not leave their workplace plans for subsidized coverage through the exchanges. But the “error” was that it only applies to the employee — and not his or her family. So, if an employer offers a woman affordable insurance, but doesn’t provide it for her family, they cannot get subsidized help through the state health exchanges.
That can make a huge difference; the Kaiser Family Foundation said an average plan for an individual is about $5,600, but it goes up to $15,700 for families. Most employers help out with those costs, but not all.
Arguing federal workers should not get special treatment, Rand Paul says he does not want taxpayers subsidizing the personal health-care plans of any federal employee — including Chief Justice John Roberts — anymore.
In the past, a college degree all but assured job seekers employment and high earnings, but today, what you make depends on what you take. In Hard Times 2013, we show differences in unemployment and earnings based on major for BA and graduate degree holders. We show that STEM — Science, Technology, Engineering, and Mathematics — majors typically offer the best opportunities for employment and earnings, while unemployment is higher for graduates with non-technical degrees.
Here are some of our major findings:
1. Even as the housing bubble seems to be dissipating, unemployment rates for recent architecture graduates have remained high (12.8%). Graduate degrees and work experience did not shield these graduates from a sector-specific shock; graduates with experience in the field have the same jobless rates as the economy overall (9.3%)
2. Unemployment is generally higher for non-technical majors, such as the arts (9.8%) or law and public policy (9.2%).
3. People who make technology are still better off than people who use technology. Unemployment rates for recent graduates in information systems, concentrated in clerical functions, is high (14.7%) compared with mathematics (5.9%) and computer science (8.7%).
4. Unemployment rates are relatively low for recent graduates in education (5.0%), engineering (7.0%), health and the sciences (4.8%) because they are tied to stable or growing industry sectors and occupations.
5. Graduates in psychology and social work also have relatively low rates (8.8%) because almost half of them work in healthcare or education sectors.
The comparison between “countries” is somewhat arbitrary. The population range for the countries in this set spans two orders of magnitude: millions to hundreds of millions. Their ethnicities, geographies and densities are different as well. We must be careful in drawing conclusions when comparing small, relatively homogeneous countries such as Finland against a population with the size and heterogeneity of the US
The father of Newtown Connecticut school shooter Adam Lanza is Peter Lanza who is a VP and Tax Director at GE Financial. The father of Aurora Colorado movie theater shooter James Holmes is Robert Holmes, the lead scientist for the credit score company FICO. Both men were to testify before the US Sentate in the ongoing LIBOR scandal.The London Interbank Offered Rate, known as Libor, is the average interest rate at which banks can borrow from each other. 16 international banks have been implicated in this ongoing scandal, accused of rigging contracts worth trillions of dollars. HSBC has already been fined $1.9 billion and three of their low level traders arrested.
A ‘self-fulfilling recession’ is a long-established idea in economics. This column argues that the US’s economic malaise continues to be caused by leaders’ hysteria rather than by actual engrained economic problems. Obama and Congress need to stop scaring the nation about the ‘fiscal cliff’ because, ultimately, they are coordinating expectations on there being a recession. Tackling the right policies now, and sending out the right message, will help more than hysteria
What happened to Detroit? It is achieving socialism in one city.
The Census Bureau estimates there are 563,055 people age 16 or older in the city who could potentially work and be part of the labor force. But only 54.3 percent of these — or 305,479 individuals — actually do participate in the labor force, meaning they either have a job or are looking for one.
Another 257,576 of Detroit residents age 16 or older — 45.7 percent of that demographic — do not participate in the labor force. They do not have a job, and they are not looking for one.
In fact, these 257,576 people in Detroit who do not have a job and are not looking for one outnumber the 224,846 residents who do have jobs. But of the 224,846 residents who do have jobs, 34,500 — or 15.3 percent — have jobs with the government. Thus, this city that boasted 1,849,568 residents in 1950 has only 190,346 private-sector workers today.
There are 264,209 households in Detroit, and 91,204 of them — or 34.5 percent — get food stamps.
Do small-business owners really fear that the re-election of President Barack Obama is worse for their businesses than the collapse of Lehman Brothers?A survey released Tuesday by the National Federation of Independent Business suggested as much. Not only did small-business sentiment plunge, but the net percentage of owners expecting better business conditions in six months fell 37 points.
President Obama argues that the election gave him a mandate to raise taxes on high earners, and the White House indicates that he won’t compromise on this issue as the so-called fiscal cliff approaches.
But tax rates are already high—much higher than is commonly understood—and increasing them will likely further depress the economy, especially by affecting the number of hours Americans work.
Taking into account all taxes on earnings and consumer spending—including federal, state and local income taxes, Social Security and Medicare payroll taxes, excise taxes, and state and local sales taxes—Edward Prescott has shown (especially in the Quarterly Review of the Federal Reserve Bank of Minneapolis, 2004) that the U.S. average marginal effective tax rate is around 40%.
It’s one reason America has been unusually slow to recover from the Great Recession. After previous recessions, employers quickly resumed hiring. Not this time. The unemployment rate is still near 8 percent. It only fell last month because people stopped looking for jobs.
Dan Mitchell of the Cato Institute understands what’s happening.
“Add up all the regulations and red tape, all the government spending, all the tax increases we’re about to get — you can understand why entrepreneurs think: “Maybe I don’t want to hire people. … I want to keep my company small. I don’t want to give health insurance, because then I’m stuck with all the Obamacare mandates.” We can see our future in Europe — unless we change. Ann Jolis, who covers European labor issues for The Wall Street Journal, watches how government-imposed work rules sabotage economies.
“The minimum guaranteed annual vacation in Europe is 20 days paid vacation a year. … In France, it starts at 25 guaranteed days off. … This summer, the European Court of Justice … gave workers the right to a vacation do-over. … You spend the last eight days of your vacation laid up with a sprained ankle … eight days automatically go into your sick leave. … You get a vacation do-over.”
Just when most people were getting used to the idea of QE3, yesterday the Fed announced QE4. When will the madness stop? In the Fed’s latest announcement it mentioned the “projected” inflation rate. This article will take a look at the TIPS expected inflation indicator to determine how long the Fed can remain accommodative under the new guidelines.
Do deficits matter? Conservatives have sometimes claimed that they don’t. Dick Cheney has said on more than one occasion that, “Reagan taught us that deficits don’t matter.” In fact, he said that to me personally once.
Supply-siders like me have often downplayed the importance of deficits, arguing as George Gilder and Jack Kemp argued in the 1980s that we can ‘grow our way out of it’. But we can only grow our way out of it if we actually grow. And if wedon’t grow, there comes a time when debt grows to the point where it really is unsustainable.
Health insurance premiums may as much as double for some small businesses and individual buyers in the U.S. when the Affordable Care Act’s major provisions start in 2014, Aetna Inc.’s chief executive officer said.
Nine years ago, California Democrat Gray Davis became the first U.S. governor in 82 years to be recalled by voters. The state’s 20 million taxpayers still bear the cost of his four years and 10 months on the job.
Davis escalated salaries and benefits for 164,000 state workers, including a 34 percent raise for prison guards, the first of a series of steps in which he and successors saddled California with a legacy of dysfunction. Today, the state’s highest-paid employees make far more than comparable workers elsewhere in almost all job and wage categories, from public safety to health care, base pay to overtime.
In theory, confiscating the wealth of the more successful people ought to make the rest of the society more prosperous. But when the Soviet Union confiscated the wealth of successful farmers, food became scarce. As many people died of starvation under Stalin in the 1930s as died in Hitler’s Holocaust in the 1940s.
How can that be? It is not complicated. You can only confiscate the wealth that exists at a given moment. You cannot confiscate future wealth — and that future wealth is less likely to be produced when people see that it is going to be confiscated. Farmers in the Soviet Union cut back on how much time and effort they invested in growing their crops, when they realized that the government was going to take a big part of the harvest. They slaughtered and ate young farm animals that they would normally keep tending and feeding while raising them to maturity.
The Federal Reserve’s decision to jolt the economy a third time with monetary stimulus measures won’t help the country much but could stoke inflationary pressures down the road, said Dallas Fed President Richard Fisher, a noted inflation hawk.
What has caused California’s transformation from a “pull in” to a “push out” state? The data have revealed several crucial drivers. One is chronic economic adversity (in most years, California unemployment is above the national average). Another is density: the Los Angeles and Orange County region now has a population density of 6,999.3 per square mile—well ahead of New York or Chicago. Dense coastal areas are a source of internal migration, as people seek more space in California’s interior, as well as migration to other states. A third factor is state and local governments’ constant fiscal instability, which sends at least two discouraging messages to businesses and individuals. One is that they cannot count on state and local governments to provide essential services—much less, tax breaks or other incentives. Second, chronically out-of-balance budgets can be seen as tax hikes waiting to happen.
Government dependence is driving budget deficits and federal debt. More than 70 percent of federal spending goes to 47 government dependence programs, including housing, farm subsidies, and the three largest entitlements, Medicare, Medicaid, and Social Security.
As Roseanne Barr continues her presidential campaign as the Peace and Freedom Party candidate, she has a attention-grabbing message: We need more socialism.
“I do think that we need a little bit more socialism in this country at this time,” Barr told Sean Hannity Monday night. “We need to move stuff from the top to the middle and the bottom, because it keeps on staying at the top.”
A Pennsylvania high school marching band is raising eyebrows with a halftime performance that commemorates the Russian revolution, complete with red flags, olive military-style uniforms, and giant hammers and sickles.
“There is no reason for Americans to celebrate the Russian revolution,” said one irate parent who alerted Fox News. “I am sure the millions who died under Communism would not see the joy of celebrating the Russian revolution by a school 10 miles from Gettysburg.”
Former Secretary of State Colin Powell said America “shouldn’t be afraid” to use the word capitalism when encouraging economic growth in emerging democracies in the Middle East because “it’s what gave us all our wealth.”
Built up over more than two centuries, America’s “irreversible trend toward more freedom” has been suddenly (and stunningly) reversed over the last decade – with tragic consequences for business owners, taxpayers and citizens alike. Once a bastion of free market ideology and unprecedented prosperity, America’s ongoing descent into dependence-inducing command economics is fast approaching terminal velocity.
They don’t ring a bell at the top of a bull market nor at the bottom of a bear market. But when it comes to inflation there are some early warning signs that investors can monitor, according to a new report.
I am not about to argue the morality of central bank actions, as Richard Russell recently did in his Dow Letter. What I simply recognize is that greater inflation, right or wrong, is imminent. What is further clear to me is that inflation will be driven not only by monetary factors, but by increasing demand for scarce resources, particularly food, energy and healthcare.
In the next four years — no matter who’s president — Wall Street will keep repeating the B.S., piling it on thicker, deeper, until they finally trigger a new meltdown bigger than 2008, worse than 1929, driving America into another Great Depression, like the 1930s