Quotulatiousness

April 30, 2014

Inheritance taxes actually perpetuate the 1%

Filed under: Britain, Economics, USA — Tags: , , , — Nicholas @ 08:18

Here’s Tim Worstall’s counter-intuitive post at the Adam Smith Institute blog from last week:

… Note “family foundation” there. Because of that inheritance tax rich people do tend to (and they have to be very rich for it to work) stick all of the money into a foundation. This wealth can then be maintained by professional money managers down the generations. Tax free, of course, as it’s inside a foundation. The stipulation is that said foundation must give away 5% of its assets each year. But such “giving away” obviously includes employing family members to run it. At pretty much any salary desired.

This obviously wouldn’t happen if the money could just be left directly to children without tax being due. And the effect of it going into such a foundation where the professional money managers can maintain it, rather than the heirs blow it, is that we’ve lost one of the major forces that disperses wealth through the society. The feckless heir.

So, we end up with the imposition of the tax leading to the continued concentration of old wealth, as the avoidance of the tax reduces the ability of the inheritors to waste it.

As an example, who thinks that any of the Kennedys would still be rich if they’d been able to get their hands on old Joe’s money directly?

I rest my case.

As one of the comments on that post points out, it’s not just the inheritance tax: it’s the interaction between the tax and the rules governing family foundations that create this unexpected-to-most-of-the-99% situation. I’m sure the 1% who can benefit from this are fully aware of it. This could be fixed either way, but the very people who benefit are the ones who would be pivotal in whether the changes could be made. So, it’s technically possible but not at all likely.

American foreign policy in the Obama era

Filed under: Government, Politics, USA — Tags: , , — Nicholas @ 07:49

Victor Davis Hanson sketches out the way US foreign policy changed when Barack Obama was elected:

The first-term foreign policy’s assumptions went something like this. Obama was to assure the world that he was not George W. Bush. Whatever the latter was for, Obama was mostly against. Given that Bush had left office with polls similar to Harry Truman’s final numbers, this seemed to Obama a wise political approach.

[…]

Second, policy per se would be secondary to Obama’s personal narrative and iconic status. Obama, by virtue of his nontraditional name, his mixed-race ancestry, and his unmistakably leftist politics, would win over America’s critics to the point where most disagreements — themselves largely provoked by prior traditional and blinkered administrations — would dissipate. Rhetoric and symbolism would trump Obama’s complete absence of foreign-policy experience.

[…]

Third, Obama had a clever recipe for concocting a new disengagement. He would mesh the increasing American weariness with intervention abroad and fears over a shaky economy with his own worldview about the dubious past role of the United States. The result might be that both libertarians and liberals, for differing reasons, would agree that we should stay out of problems abroad, that a struggling lower class and middle class would agree that money spent overseas was money that could be better spent at home, and that critiques of America’s past would seem not so much effusions of leftist ideology as practical reasons why the United States should disengage abroad.

Finally, to the degree that any problems still persisted, Obama could either contextualize them (given his legal training and community-organizing experience), or talk loudly and threaten. For example, by referencing past American sins, by an occasional ceremonial bow or apology, by a bit of psychoanalysis about “macho shtick” or the schoolboy Putin cutting up in the back of the room, an exalted Obama would show the world that he understood anti-social behavior and could ameliorate it as a counselor does with his emotional client. The world in turn would appreciate his patience and understanding with lesser folk, and react accordingly. Again, in place of policy would be the towering personality of Barack Obama. And if all that did not work, a peeved Obama could issue deadlines, red lines, and step-over lines to aggressors — and reissue them when they were ignored.

Norway’s human rights record criticized by … Saudi Arabia

Filed under: Europe, Russia — Tags: , , , — Nicholas @ 07:09

The Saudi government and the Russian government both called for Norway to correct its appalling record in (certain) human rights areas:

Saudi Arabia has criticised Norway’s human rights record, accusing the country of failing to protect its Muslim citizens and not doing enough to counter criticism of the prophet Mohammed.

The gulf state called for all criticism of religion and of prophet Mohammed to be made illegal in Norway. It also expressed concern at “increasing cases of domestic violence, rape crimes and inequality in riches” and noted a continuation of hate crimes against Muslims in the country.

The Scandinavian nation came under scrutiny during the United Nations’ Universal Periodic Review, in which 14 States are scheduled to have their human rights records examined.

Russia meanwhile called for Norway to clamp down on expressions of religious intolerance and and criticised the country’s child welfare system. They also recommended that Norway improve its correctional facilities for those applying for asylum status.

An amusing co-incidence: while I was adding tags to this post, I typed “sau” to get the auto-fill “SaudiArabia” tag. The other tag that fit that pattern? “Dinosaurs”. H/T to Amy Alkon for the link.

Disturbing US unemployment figures

Filed under: Economics, Government, USA — Tags: , — Nicholas @ 06:58

Michael Snyder says the official unemployment rate actually conceals more than it reveals:

According to shocking new numbers that were just released by the Bureau of Labor Statistics [PDF], 20 percent of American families do not have a single person that is working. So when someone tries to tell you that the unemployment rate in the United States is about 7 percent, you should just laugh. One-fifth of the families in the entire country do not have a single member with a job. That is absolutely astonishing. How can a family survive if nobody is making any money? Well, the answer to that question is actually quite easy. There is a reason why government dependence has reached epidemic levels in the United States. Without enough jobs, tens of millions of additional Americans have been forced to reach out to the government for help. At this point, if you can believe it, the number of Americans getting money or benefits from the federal government each month exceeds the number of full-time workers in the private sector by more than 60 million.

[…]

A number that I find much more useful is the employment-population ratio. According to the employment-population ratio, the percentage of working age Americans that actually have a job has been below 59 percent for more than four years in a row…

US Employment-Population Ratio 2002-2014

That means that more than 41 percent of all working age Americans do not have a job.

When people can’t take care of themselves, it becomes necessary for the government to take care of them. And what we have seen in recent years is government dependence soar to unprecedented levels. In fact, welfare spending and entitlement payments now make up 69 percent of the entire federal budget.

What if real life had lag like online games do?

Filed under: Humour, Technology — Tags: , — Nicholas @ 00:01

You wouldn’t accept lag offline, so why do it online? ume.net, a fiber broadband provider that offers up to 1000 Mbit/s, performed an experiment. Four volunteers got to experience internet’s biggest disturbance in real life – lag.

H/T to Jeff Sher for the link.

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