Quotulatiousness

March 3, 2013

California’s retroactive tax grab

Filed under: Business, Government, USA — Tags: , — Nicholas @ 13:03

The state of California seems determined to drive out the remaining businesses that pay taxes. Here’s Wendy McElroy with news of a retroactive change to a small business tax break:

California cannot chase business away fast enough, it seems: high taxes, cap-and-trade, voracious unions, bankrupt cities, and now retroactive taxation.

Shortly before the Christmas holidays and oh so quietly, the California Franchise Tax Board (FTB) rescinded a tax break that dated back to 1993. The Qualified Small Business Stock (QSBS) exclusion allowed small businesses and investors who met certain conditions to exclude or to defer 50 percent of the profits of sold stock from their personal income taxes. The incentive was intended to lure startup companies of under $50 million into the state.

Now those who were ensnared have not only lost that tax break for the future; many are also being taxed retroactively back to 2008. Plus interest. Plus possible penalties.

March 2, 2013

QotD: “One way to know that you’re doing the right thing”

Filed under: Bureaucracy, Government, Politics, Quotations — Tags: , , , , — Nicholas @ 10:27

Is to look at peoples’ reactions to what you’re doing. If, for example, you decided that you wanted to clean up the MPs’ expenses system and every MP then started howling about how we mere ignorant citizenry aren’t supposed to control them then we’d know that we were on the right track. Similarly, if every criminal in the country (to the extent that this is a different group from MPs) starts to complain about the length of sentences after just and righteous trials then you would at least begin to suspect that you might have created sentences which have a deterrent effect.

Tim Worstall, “One way to know that you’re doing the right thing”, Adam Smith Institute blog, 2013-03-02

A 2% budget cut should not impact day-to-day services

Filed under: Bureaucracy, Government, Politics, USA — Tags: , , , — Nicholas @ 10:04

In the Washington Times, Gary Johnson looks at the wild claims about what the sequester will do to the services Americans receive from the federal government:

To listen to the parade of Obama administration officials warning of civilization-ending consequences from the measly $85 billion in spending “cuts” sequestration will bring, one can only reach one of two conclusions: Either they are just making stuff up to make the cuts as painful as possible, or the federal budget is so out of control that a mere 2.4 percent reduction in projected spending is more than the system can handle.

Frankly, it is both. Absolutely, in their zeal to make Republicans pay the maximum political price for what is actually both parties’ fault, it is almost comical to watch one Cabinet official after another step up to the microphone and tell us that a 2.4 percent reduction (that isn’t really a reduction) will cause airplanes to fall out of the sky, our national defense to be disabled and our children to starve. That game is among the oldest in Washington. Cut the Park Service budget, and suddenly they can’t find the money to keep the Lincoln Memorial or Yellowstone open.

This sideshow is entertaining, but it misses what may be the most important lesson to be learned from this sequester debacle. While there is certainly a heavy dose of Chicken Little falling-sky rhetoric coming out of the bureaucracy, it is probably true that the rather indiscriminate sequester formula is presenting some challenges for some agencies.

[. . .]

If “cutting” discretionary spending by a lousy 2 or 3 cents on the dollar is enough to create dire consequences (for the sake of argument), imagine what would happen if we tried to reduce that spending by the 30 cents it will take to balance the budget and stop digging ourselves even deeper into unsustainable debt.

March 1, 2013

Sequester nightmare: “The administration has every incentive to make the sky fall, lest we suffer that terrible calamity — cuts the nation survives”

Filed under: Government, Media, Politics, USA — Tags: , , — Nicholas @ 10:19

Charles Krauthammer on the differing aims of the President and the congressional Republicans over sequestration:

“The worst-case scenario for us,” a leading anti-budget-cuts lobbyist told The Washington Post, “is the sequester hits and nothing bad really happens.”

Think about that. Worst case? That a government drowning in debt should cut back by 2.2 percent — and the country survives. That a government now borrowing 35 cents of every dollar it spends reduces that borrowing by two cents “and nothing bad really happens.” Oh, the humanity!

A normal citizen might think this a good thing. For reactionary liberalism, however, whatever sum our ever-inflating government happens to spend today (now double what Bill Clinton spent in his last year) is the Platonic ideal — the reduction of which, however minuscule, is a national calamity.

Or damn well should be. Otherwise, people might get the idea that we can shrink government, and live on.

Hence the president’s message. If the “sequestration” — automatic spending cuts — goes into effect, the skies will fall. Plane travel jeopardized, carrier groups beached, teachers furloughed.

The administration has every incentive to make the sky fall, lest we suffer that terrible calamity — cuts the nation survives. Are they threatening to pare back consultants, conferences, travel and other nonessential fluff? Hardly. It shall be air-traffic control. Meat inspection. Weather forecasting.

Update: Mark Steyn was a guest on the Hugh Hewitt show the other day to talk about this:

I’m not big on those Mayan guys, but those Mayan guys only hold an apocalypse every few thousand years. Washington now has a Mayan apocalypse every six weeks, whether it’s the fiscal cliff or the debt ceiling, or now the sequestration. And as you say, it’s talking about $44 billion dollars, or about what the United States government borrows, borrows every nine days, every nine days. So in other words, we’ve just spent weeks talking about nine days’ worth of borrowing, which in any eventual deal isn’t actually going to be saved anyway, because the latest deficit reduction bill actually increases the deficit, because that’s just the way Washington works.

[. . .]

Yeah, and you know what’s crazy about this is that let’s pretend that the officials who are speaking on this, the cabinet secretaries who are coming out and telling us that the world will come to an end tomorrow, that the planes are going to be dropping from the skies, that our infants and seniors are going to be dying untended in hospitals, that your shower head is going to be blasting out fecal coliform on you in the morning, that all of this is going to be happening just for his hypothetical $40 billion dollars of so-called entirely phony sequestration cuts, now assuming they’re not just lying to us. They’re basically telling us that nothing can ever be done about Washington spending ever. If $40 billion of hypothetical cuts means that the planes are dropping from the skies, and Obama’s even cancelled the deployment of a carrier to the Gulf, you know, in other words, when the Iranians go nuclear, he’ll be able to say oh, I would have stopped that, but we were all tied up with the sequestration. Sequestration is what allowed the mullahs to go nuclear. If that’s true, nothing can ever be done about anything ever, and Washington might as well just close up and go home.

February 28, 2013

North Korea struggling with loss of faith in the state

Filed under: Asia, China, Government — Tags: , , , , , — Nicholas @ 08:50

Strategy Page on the challenges facing the government as the younger generation grows up:

A major source of information about North Korea is obtained by South Korean intelligence experts interviewing the steady flow of refugees arriving in South Korea (via China and the South Korean embassies in neighboring countries like Thailand). For the last decade, over a thousand of these refugees have arrived each year. In the last few years China and North Korea have increased their efforts to reduce that number, which peaked at 2,900 in 2009 and was 1,500 last year. These determined and desperate people keep coming. Separate interviews are compared and checked against each other to obtain an updated and accurate first-hand view of life in the north. This also helps detect the spies North Korea tries (often with success) getting into the south via the refugee route. While the refugees detail the growing decline in living standards up north, it’s also become clear that there is a very real generational shift in loyalties in the north. The generation who grew up during the 1990s famine (that killed about ten percent of the population and starved most of the rest for years) no longer believe in the North Korean dictatorship. Many who came of age before 1990 still do, but for most everyone under 30 the state is the enemy and self-reliance, and not a benevolent dictatorship, is the only way to survive. The North Korean government has been fighting these attitudes more and more, as this generation of unbelievers grows larger each year. The more astute members of the northern leadership see this as a no-win situation. Eventually most North Koreans will be very hostile to the state and more adept at making money in spite of the government, or simply getting out of the country. Most of the leadership is still afraid of enacting Chinese style economic reforms because they believe a more affluent population would seek revenge for the decades of misrule and tyranny. The Chinese say that didn’t happen in China. The North Koreans point out that, as bad as the Chinese communists were in the 1950s and 60s (killing over 50 million people via starvation, labor camps and execution) that was not as bad (proportionately) as what the North Koreans have suffered. Moreover, the North Korean leaders point out that, historically, Koreans have been a bit more excitable and brutal when aroused by misrule. The Chinese say times have changed but the North Korean leaders are not yet willing to bet their lives on that being the case.

The refugees report that most North Koreans understand that the police state up there is strong enough to suppress any uprising now or in the foreseeable future and that the only real threat to the dictatorship is intervention (openly or via a coup) by China. Refugees also report that it’s common knowledge that hundreds of North Koreans have died of radiation poisoning or been born with birth defects because of the uranium mining and working with nuclear materials. The government has responded by offering large cash bonuses to those who will work in the uranium mines. The refugees report in detail many other ways the Kim government abuses their subjects.

Cybersecurity … can it be anything more than fear + handwaving = “we must have a law!”

Filed under: Business, Government, Law, Technology — Tags: , , , , , — Nicholas @ 00:01

At Techdirt, Mike Masnick fisks “the worst article you might ever read about ‘Cybersecurity'”:

There has been a lot of discussion lately about “cybersecurity” “cyberwar” “cyberattacks” and all sorts of related subjects which really really (really!) could do without the outdated and undeniably lame “cyber-” prefix. This is, in large part, due to the return of CISPA along with the White House’s cybersecurity executive order. Of course, the unfortunate part is that we’re still dealing in a massive amount of hype about the “threats” these initiatives are trying to face. They’re always couched in vague and scary terms, like something out of a movie. There are rarely any specifics, and the few times there are, there is no indication how things like CISPA would actually help. The formula is straightforward: fear + handwaving = “we must have a law!”

However, I think we may now have come across what I believe may top the list of the worst articles ever written about cybersecurity. If it’s not at the top, it’s close. It is by lawyer Michael Volkov, and kicks off with a title that shows us that Volkov is fully on board with new laws and ramping up the FUD: The Storm Has Arrived: Cybersecurity, Risks And Response. As with many of these types of articles, I went searching for the evidence of these risks, but came away, instead, scratching my head, wondering if Volkov actually understands this subject at all, with his confused thinking culminating in an amazing paragraph so full of wrong that almost makes me wonder if the whole thing is a parody.

[. . .]

There’s been plenty of talk about these Chinese hacks, which definitely do appear to be happening. But, what economic activity has been undermined? So far, the hacks may have been a nuisance, but it’s unclear that they’ve done any real damage. It is also unclear how CISPA helps stop such hacks, other than making Congress feel like it’s “done something.”

Are there issues with online security that need to be taken seriously? Yes, absolutely. Do we need legislation to deal with those problems? That’s debatable, and we’re still waiting for some evidence not just of scary sounding threats, but that this kind of legislation will actually help. Unfortunately, this article keeps us waiting. But, it did make us laugh. Unintentionally (we think).

February 27, 2013

Parliamentary Budget Officer conducting “constitutional vandalism”

Filed under: Cancon, Government, Law, Media — Tags: , , , , — Nicholas @ 11:58

Senator Anne Cools is displeased by the PBO’s ongoing legal and media campaign against the Federal government:

An independent senator says the parliamentary budget watchdog, Kevin Page, overstepped his mandate by taking the government to court in a battle for spending figures, and the Senate should force Page to withdraw the legal proceedings.

In a speech to the Senate Tuesday, Sen. Anne Cools argued that Page’s regular comments to reporters and more recent comments to his international counterparts about his battles with the government over spending figures were “provocative and inflammatory public statements” that are “intolerable and unacceptable.”

Page’s actions, Cools argued, were tantamount to contempt of Parliament, were a breach of parliamentary privilege and were affecting the Senate’s credibility to carry out its functions.

“Contemptuous and un-parliamentary,” she said of Page’s actions and comments, “they are constitutional vandalism.”

“They are inappropriate conduct from a Library officer under the direction of the Speakers of the Senate and the House of Commons. This Senate cannot accept this and should take some ‘shock-no-more’ actions.”

Is the President a munchkin?

Filed under: Gaming, Government, Humour, USA — Tags: , , — Nicholas @ 10:18

Moe Lane compares the type of role-playing gamer that most RPG’ers dislike the most to the current performance of President Obama in his role:

To begin with: a munchkin (or power gamer, or mini-maxer, or a bunch of terms that cannot be repeated here) is a type of gamer (roleplaying, computer, roleplaying-computer) who looks for loopholes in the rules — because games have rules, and there isn’t a ruleset in the world that cannot be manipulated by somebody with enough motivation/obsession. And it turns out that the American Democratic primary system was full of such loopholes, which is why Barack Obama won the nomination in 2008 despite losing almost all the big Democratic primary states […] And it also turns out that the intersection of our electoral system with our rapidly-expanding online culture can produce what computer gamers call “exploits:” which is to say, a glitch in the system that gives someone an unintended benefit (if it just crashes the system, it’s a bug). Strictly speaking, the system is not designed to elevate a state Senator to the Presidency in five years — for what turned out to be very good reasons — but it can be done.

The problem, though, is that Barack Obama (and I should note that I am lumping his election team in with him here, as Obama largely does not really have much of an independent personality himself) has what the gaming community calls “mini-maxed” himself. Let me explain that one a bit more: lots of video games allow for the player to control a character that gets better at the game as he or she goes through the various game ‘boards.’ Special abilities, improved combat techniques, cool-looking items: if you’re playing a game that is something else besides a straight combat game, you can usually improve how you interact with computer-generated characters (“NPCs”) in the game, or learn how to make your own cool items, or whatever else the game designers thought that you’d like to do. Since gamers like to have unique characters (this is very much the young adult male equivalent to playing dress-up with dolls) there’s usually a way to customize your character, which is to say: people get to choose how and where the character improves.

Mini-maxing is when a player designs a character that is fantastically good at one thing, at the expense of everything else. So you could end up with a character who is, say, obscenely good at hitting things with a sword — but can’t convince a bunch of sailors to drink free beer. The mini-maxer doesn’t mind; he’ll just go around the game trying to resolve as many problems as he can by hitting them with a sword (tabletop gamers — err, “D&D players” — often call this The Gun is My Skill List, although obviously substitute a sword for a gun in the name). The problems that the mini-maxer can’t resolve that way he’ll either ignore until later, or else flail about on the screen while hitting the buttons quickly and/or at random (“button-mashing”), in the hopes that eventually the laws of probability will allow him to bull on through anyway.

And that’s where we are now. Barack Obama knows how to do one thing: elect Barack Obama to public office. And that’s not ‘elect Democrats.’ Or ‘elect liberals.’ Or even ‘elect people that Barack Obama likes.’ It’s just him: his team is trying pretty hard right now to figure out how to use their over-specialized skill more generally, but they don’t have much time to figure it out and the system is actually rigged against them in this case. Barack Obama certainly doesn’t know how to govern effectively; take away a Congress that will rubber-stamp the Democratic agenda and he flails about. He’s so bad at this, in fact, that when confronted with a situation where all he had to do was do nothing to fulfill a campaign promise (the tax cuts) we somehow ended up with a situation where Obama gave in on 98% of those tax cuts and voluntarily signed up to take the blame for the AMT fix. In short: Obama was woefully unprepared for the Presidency, and he hasn’t really spent the last four years trying to catch up. Instead, he goes from situation to situation either trying to recast the problem in ways that he does have some skill in (permanent campaigning for office), or else… flail about on the scene while hitting people’s buttons quickly and/or at random, in the hopes that eventually the laws of probability will allow him to bull on through anyway.

H/T to Jim Geraghty for the link.

Australia’s “human rights enforcement” industry

Filed under: Australia, Government, Law, Liberty — Tags: , , , , — Nicholas @ 09:57

Australia, like Canada, has a large and over-mighty set of bureaucracies empowered to pursue “human rights” scofflaws (I put “human rights” in scare quotes because the most prominent cases in both countries appear to be enforcement of certain privileges rather than ensuring equal rights for all). Nick Cater says that the joyride for these — if you’ll pardon the expression — kangaroo courts may be coming to an end:

Quietly at first, but with a swelling, indignant chorus, respectable Australians of unimpeachable character began howling Roxon’s bill down. The contrivance of describing race, gender, sexual orientation, disability or 14 other grounds for victimhood as ‘protected attributes’ jarred; the inclusion of industrial history, breastfeeding or pregnancy or social origin suggested overkill; the reversal on the onus of proof, obliging alleged racists, misogynists and wheelchair kickers to demonstrate their innocence, seemed a step too far. The ABC’s chairman, Jim Spigelman, a lawyer of some standing, voiced his concerns about the outcome of the Bolt case. ‘I am not aware of any international human-rights instrument or national anti-discrimination statute in another liberal democracy that extends to conduct which is merely offensive’, Mr Spigelman said. ‘We would be pretty much on our own in declaring conduct which does no more than offend to be unlawful. The freedom to offend is an integral component of freedom of speech.’

[. . .]

Unlike political opinion, attributes like age or gender or sexuality are objective facts. They did not have to be demonstrated. As Senator Brandis pointed out: ‘There is no imperative for a 45-year-old man to go around saying, “I’m 45”. That does not happen.’ Political opinion, however, means nothing unless it is expressed.

Brandis: ‘I do not know if you are familiar with Czeslaw Milosz’s work The Captive Mind, or Arthur Koestler’s book Darkness At Noon… The whole point of political freedom is that there is an imperishable conjunction between the right to hold the opinion and the right to express the opinion. That is why political censorship is so evil — not because it prohibits us holding an opinion but because it prohibits us articulating the opinion that we hold.

‘We all agree that there is no law in Australia that says you cannot have a particular opinion. We all agree that there are certain laws in Australia, including defamation laws, that limit the freedom of speech. My contention is that there should not, in a free society, be laws that prohibit the expression of an opinion… This attempt to say, “Holding an opinion is one thing but expressing an opinion is quite different”, is terribly dangerous in a liberal democratic politic.’

February 26, 2013

Budget cutting gets real in Ottawa

Filed under: Cancon, Government — Tags: , — Nicholas @ 11:11

David Akin tweeted some news about upcoming budget cuts for various Canadian government agencies:

Defence industry lobbyists versus actual USAF needs

Filed under: Business, Government, Military, Technology, USA — Tags: , , , — Nicholas @ 10:35

Strategy Page talks about the ongoing drama of the Global Hawk UAV and the US Air Force’s attempt to get rid of the weapon:

The U.S. Air Force recently disbanded a Global Hawk UAV squadron. The reserve unit contained 200 personnel and operated an aircraft the air force is getting rid of. This is in spite of political opposition to the move (helped along by the manufacturers many lobbyists).

This all began last year when the U.S. Air Force cancelled all orders for the Block 30 Global Hawk because of reliability issues. This renewed Department of Defense threats to cancel the Global Hawk program entirely. In response Northrop Grumman (the RQ-4 manufacturer) lobbyists made sure that key members of Congress knew where Global Hawk components were being built and how many jobs that added up to. Elected politicians pay attention to that. This move delayed the RQ-4 Block 30 until there was enough political support to convince Congress to order the air force to accept the Block 30 RQ-4s and shut up.

The air force can take some comfort in the fact that Northrop Grumman fixed some of the problems (some of which the manufacturer said don’t exist or didn’t matter). The Block 30 was supposed to be good to go but the air force was not convinced and decided that Block 30 was just more broken promises. Congress was also tired of all the feuding and being caught between Northrup lobbyists and exasperated air force generals. The lobbyists, as is usually the case, eventually won. But the air force is not required to pay for operating the Global Hawks, thus the disbanding of the Global Hawk unit.

February 25, 2013

Worst. Student movement. Ever.

Filed under: Cancon, Education, Government — Tags: , , , — Nicholas @ 11:04

The FEUQ speeds into the global lead for worst student movement ever:

I’m trying to imagine a worse excuse for a student movement than the one Quebec has at the moment; and I have to say that I’m not sure I can.

I mean, sure, the Canadian Federation of Students has talked some awful crap about how reducing net tuition for poor students is unacceptable, unless richer kids get a break too — really ludicrous stuff, which objectively favours richer students over poorer ones. But so far as I know, they’ve never actively aided and abetted a government that was intent on making universities poorer.

But that’s what FEUQ, and the rest of the Quebec student movement, seem to be doing right now.

[. . .]

FEUQ’s train of thought seems to run something like this: 1) Universities want more money; 2) the provincial government is broke; 3) therefore, new money can only come out of tuition fees; 4) therefore, we’d better oppose this. The problem is, if you concede point 2 you’re more or less screwed in terms of asking something for yourself, like a more generous student aid system (which Quebec certainly needs, at least for dependent students). And you’ve gone and hacked-off one of your most natural allies as far as higher education is concerned.

H/T to Stephen Gordon for the link.

Hollywood’s addiction problem

Filed under: Business, Government, Media, USA — Tags: , , , — Nicholas @ 09:19

It’s not addiction to drugs — although we can be sure there’s more than enough of that — it’s addiction to government subsidies, tax credits, and special privileges not available to ordinary businesses:

With campaign season over, you’re not likely to hear stars bringing up taxes at [the] Academy Awards show. But the tax man ought to come out and take a bow anyway. Of the nine “Best Picture” nominees in 2012, for example, five were filmed on location in states where the production company received financial incentives, including The Help (in Mississippi) and Moneyball (in California). Virginia gave $3.5 million to this year’s Oscar-nominated Lincoln.

Such state incentives are widespread, and often substantial, but they don’t do much to attract jobs. About $1.5 billion in tax credits and exemptions, grants, waived fees and other financial inducements went to the film industry in 2010, according to data analyzed by the Center on Budget and Policy Priorities. Politicians like to offer this largess because they get photo-ops with celebrities, but the economic payoff is minuscule. George Mason University’s Adam Thierer has called this “a growing cronyism fiasco” and noted that the number of states involved skyrocketed to 45 in 2009 from five in 2002.

In its 2012 study “State Film Studies: Not Much Bang For Too Many Bucks,” the Center on Budget and Policy Priorities found that film-related jobs tend to go to out-of-staters who jet in, then leave. “The revenue generated by economic activity induced by film subsidies,” the study notes, “falls far short of the subsidies’ direct costs to the state. To balance its budget, the state must therefore cut spending or raise revenues elsewhere, dampening the subsidies’ positive economic impact.”

February 23, 2013

QotD: “Cultural Sovereignty” (aka piracy)

Filed under: Cancon, Government, Media, Quotations — Tags: , , , , — Nicholas @ 10:52

Canada originally became one of the most wire-cabled countries in the world because of the insatiable and inviolable addiction of English-speaking Canadians to American programming. To salvage a television industry in Canada, the regulators approved the acquisition of American programming by Canadian channels, which would simulcast them with the networks by or for which they were produced. The Canadian channels were authorized to sell and insert their own advertising on those American programs. This practice, outright piracy in fact, was justified by Canadian media executives as an exercise in “cultural sovereignty” when they appeared before U.S. congressional committees.

Conrad Black, “Opening up the must-carry spectrum”, National Post, 2013-02-23

Provincial budgets range from less-than-accurate to verging on financial fraud

Filed under: Cancon, Economics, Government — Tags: , , , , , — Nicholas @ 10:43

Andrew Coyne, after a short diatribe about our first-past-the-post electoral system (he’s agin’ it), gets down to brass tacks about provincial finances:

As bad as the federal government is, the provinces are worse. And as horrendous as the provinces are generally, the record in some provinces borders on the fraudulent. Saskatchewan and Alberta, for instance, have overspent their budgets in the past decade by an average — an average — of nearly 5%. And since each year’s overshoot becomes the baseline for next year’s budget, the cumulative impact is to produce spending, in the fiscal year just ended, vastly larger than was ever specifically authorized in advance: in Saskatchewan’s case, nearly 40% larger.

That’s as best the [C. D. Howe Institute] can make out. Provincial accounting is notoriously haphazard and inconsistent. Not only does each province use its own rules and procedures, making it impossible to compare the public accounts from one province to another with any confidence, but in several provinces — Newfoundland and Quebec are the worst offenders — the public accounts are not even stated on the same basis as the budget.

And while the public accounts must ultimately prevail, efforts to reconcile the two sets of figures, and to explain the discrepancies, remain spotty. In some provinces — Quebec, Saskatchewan, British Columbia — auditors have refused, repeatedly, to sign off on the books without attaching reservations.

So not only can voters have little confidence that governments will spend what they said they would, they can have little ability even to reckon how much they overspent, or to compare their own province’s performance with the others’. All in all, a thoroughly disgraceful performance. (Honourable exceptions: Ontario and Nova Scotia, though voters in both provinces have other reasons to doubt their governments’ fiscal candour.)

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