Professor Greg Mankiw points out that the the top 1% of taxpayers paid 40.4% of the total income taxes collected by the federal government. See here.
I don't think we should have a "free lunch" system where millions of Americans have no financial stake in their government. At the same time, with sales taxes increasing, it's hard to argue the middle class and poor are getting a "free lunch."
It would be more fair to see what percentage of all taxes--state, local, and federal--are paid by the top 10% rather than just income taxes. According to the WSJ, the top 1% of earners pay 26% of all federal taxes. See here. Given the income and wealth disparity in this country, the 26% figure does not shock my conscience--in fact, it seems more on the low than the high side. (Update: the income tax is less than half of federal taxes and only one-fifth of taxes at all levels of government.)
Mankiw's cited statistics show that our income taxation system is inefficient and non-diversified. Any entity that relies on such a small percentage of its "customer" base for 40% of its "profits" will soon have problems. Rather than feel sorry for the super-rich, we should realize that income taxes are volatile and inconsistent sources of revenue. By relying on such a volatile source of revenue, the government isn't doing us any favors.
Mankiw's post implicitly contends that the rich have never had it worse--their 40% contribution is "the highest percentage in modern history," he says. This increased burden could mean two things: one, the rich are getting bilked; and/or two, the recession has hit the middle class and poor harder than the rich, so they are getting smaller slices of the income pie and paying less taxes as a result of receiving less income. I'm going with Door #2. I am disappointed that Professor Mankiw--normally a very thorough writer--cited the Tax Foundation's statistics without properly explaining the numbers.
Overall, we should figure out how to get more paying stakeholders into the system so we diversify revenue sources and rely on more recession-resistant revenue streams.
Update: Professor Mankiw points out that "the [tax] data predate the recession." Although the recession is not factored into the tax data, the disparity in tax burden between the rich and others may still be a result of a declining middle class.
"And if an epitaph be my story, I'd have a short one ready for my own: I had a lover's quarrel with the world." -- Robert Frost
Friday, July 31, 2009
Thursday, July 30, 2009
Michael Lewis on Goldman Sachs
Reason #48756 why Michael Lewis is the best financial journalist working today:
http://bloomberg.com/apps/news?pid=20601039&sid=a2X3hNaWcbeg
Every time we hear the phrase “the United States of Goldman Sachs” we shake our heads in wonder. Every ninth-grader knows that the U.S. government consists of three branches. Goldman owns just one of these outright; the second we simply rent, and the third we have no interest in at all. (Note there isn’t a single former Goldman employee on the Supreme Court.)
Devastatingly funny, isn't it?
http://bloomberg.com/apps/news?pid=20601039&sid=a2X3hNaWcbeg
Every time we hear the phrase “the United States of Goldman Sachs” we shake our heads in wonder. Every ninth-grader knows that the U.S. government consists of three branches. Goldman owns just one of these outright; the second we simply rent, and the third we have no interest in at all. (Note there isn’t a single former Goldman employee on the Supreme Court.)
Devastatingly funny, isn't it?
Wednesday, July 29, 2009
Lawyers Making a Difference: Jon Eisenberg
Here is an awesome interview (Super Lawyers, August 2009) with attorney Jon Eisenberg, who has litigated several fascinating cases against the government:
Mr. Eisenberg mentions one of his favorite authors, Jerzy Kosinski. Mr. Kosinksi's book, Being There, was adapted into a very good film by the same name. I had seen the film but was unaware of Mr. Kosinski's connection to it. If you haven't seen the film Being There, I highly recommend it. Peter Sellers plays the main character in the film.
During the Al-Haramain case you wrote a response to a government brief that you were not allowed to see. How does one go about doing that?
It was quite a challenge. It wasn't just that we had to speculate as to what might be in the secret DOJ brief; the conditions under which we wrote our secret response were onerous, approaching the bizarre: We were required to write the brief under guard in the U.S. Attorney's office in San Francisco; we were forbidden from preparing any notes for the brief-writing session; the DOJ retained sole possession of the brief we produced; and the DOJ has refused to allow us to review the brief since we wrote it. Litigation doesn't get any weirder than that.
Unbelievable stuff. Sounds like something out of a Soviet novel, doesn't it?Mr. Eisenberg mentions one of his favorite authors, Jerzy Kosinski. Mr. Kosinksi's book, Being There, was adapted into a very good film by the same name. I had seen the film but was unaware of Mr. Kosinski's connection to it. If you haven't seen the film Being There, I highly recommend it. Peter Sellers plays the main character in the film.
Tuesday, July 28, 2009
Henry Louis Gates, Questions
The following questions aren't the usual "Let's get to know you better" kind. They are leading questions, and they force you to question your own principles.
1. What is the point of the 4th Amendment if the government can tell you how to behave in your own home even after it has verified that it is your home; you have not committed a crime; and you have a legal right to be there?
2. Prof. Gates was arrested on his own front porch. The officer who arrested him had already verified his ID and appears to have been walking outside. If Prof. Gates began yelling at the police officer and belligerently demanded the officer's badge number, whose job was it to walk away and de-escalate the situation? The Harvard professor in his own home, or the police officer whose salary is being paid by the Harvard professor?
3. As soon as the police officer verified Prof. Gates' ID and realized he was the proper homeowner, did Prof. Gates have the legal right to tell the police officer to leave his property? If yes, then as a legal principle, what does it matter the choice of words that Prof. Gates used to ask the officer to leave his home?
4. Is it a crime to be verbally belligerent to a police officer in your own home when the police officer has already verified that no crime is taking place in the home? Is there ever such a thing as "contempt of cop"?
Here is the best article I've read so far on the Gates-Crowley affair (Robin Wells, July 27, 2009):
http://www.huffingtonpost.com/robin-wells/hard-truths-and-the-teach_b_245856.html
I believe that the treatment of Professor Gates was unjust and unprofessional. Yes, he was belligerent to a police officer. But that is no crime, and nowhere has Officer Crowley shown that there was any chance of a crime being committed, confirmed by the Cambridge Police Department's quick decision to drop the charges against Professor Gates. Police officers are trained to be professionals, and a professional would have recognized that an obstreperous sexagenarian who walks with a cane standing in his own house and faced with a phalanx of armed police officers is no threat...
[But] The hard truth that Professor Gates needs to hear is that he is the one who handed over his power to Officer Crowley. Letting his agitation get the better of him, Gates lost the ability to shape the outcome of the encounter and set up his own victimization by a poorly trained police officer.
Amen, sister. Basically, the police officer was unprofessional and did not handle the situation properly, but Prof. Gates could have saved himself a lot of trouble by being the bigger man. Professor Gates might not have realized he had to show the officer his state-issued ID, not just his Harvard-issued ID.
1. What is the point of the 4th Amendment if the government can tell you how to behave in your own home even after it has verified that it is your home; you have not committed a crime; and you have a legal right to be there?
2. Prof. Gates was arrested on his own front porch. The officer who arrested him had already verified his ID and appears to have been walking outside. If Prof. Gates began yelling at the police officer and belligerently demanded the officer's badge number, whose job was it to walk away and de-escalate the situation? The Harvard professor in his own home, or the police officer whose salary is being paid by the Harvard professor?
3. As soon as the police officer verified Prof. Gates' ID and realized he was the proper homeowner, did Prof. Gates have the legal right to tell the police officer to leave his property? If yes, then as a legal principle, what does it matter the choice of words that Prof. Gates used to ask the officer to leave his home?
4. Is it a crime to be verbally belligerent to a police officer in your own home when the police officer has already verified that no crime is taking place in the home? Is there ever such a thing as "contempt of cop"?
Here is the best article I've read so far on the Gates-Crowley affair (Robin Wells, July 27, 2009):
http://www.huffingtonpost.com/robin-wells/hard-truths-and-the-teach_b_245856.html
I believe that the treatment of Professor Gates was unjust and unprofessional. Yes, he was belligerent to a police officer. But that is no crime, and nowhere has Officer Crowley shown that there was any chance of a crime being committed, confirmed by the Cambridge Police Department's quick decision to drop the charges against Professor Gates. Police officers are trained to be professionals, and a professional would have recognized that an obstreperous sexagenarian who walks with a cane standing in his own house and faced with a phalanx of armed police officers is no threat...
[But] The hard truth that Professor Gates needs to hear is that he is the one who handed over his power to Officer Crowley. Letting his agitation get the better of him, Gates lost the ability to shape the outcome of the encounter and set up his own victimization by a poorly trained police officer.
Amen, sister. Basically, the police officer was unprofessional and did not handle the situation properly, but Prof. Gates could have saved himself a lot of trouble by being the bigger man. Professor Gates might not have realized he had to show the officer his state-issued ID, not just his Harvard-issued ID.
By law, you must produce state-issued ID when requested to do so by a police officer who has lawfully detained you. Most states have statutes similar to the following: “Any person so detained shall identify himself, but may not be compelled to answer any other inquiry of any peace officer." I know these types of "ID" laws sound perilously close to "Show me your papers," but the law seems clear--see U.S. Supreme Court decision Hiibel v. Sixth Judicial District Court of Nevada (2004), decided by a 5 to 4 vote. (I wonder if Justice Kennedy is now reconsidering his deciding vote.) Perhaps if Prof. Gates had known the law requires him to produce state-issued ID to an officer, the situation might not have escalated.
In any case, when a police officer needs to call backup to handle a senior citizen Harvard professor, something's amiss. As President Obama stated, "I think...that you probably don't need to handcuff a guy, a middle-aged man who uses a cane, who is in his own home."
In any case, when a police officer needs to call backup to handle a senior citizen Harvard professor, something's amiss. As President Obama stated, "I think...that you probably don't need to handcuff a guy, a middle-aged man who uses a cane, who is in his own home."
Although Prof. Gates could have de-escalated the situation, the burden was on the officer to do so, not Prof. Gates. The Cambridge Police Department owes Mr. Gates an apology for escalating what should have been a routine check.
Bonus: Here are 9th Circuit Judge Alex Kosinski's comments on free speech, which apply to Gates' case:
See Duran v. City of Douglas (1990): [T]he First Amendment protects a significant amount of verbal criticism and challenge directed at police officers." [Houston v. Hill, 482 U.S. 451 at 461] The freedom of individuals to oppose or challenge police action verbally without thereby risking arrest is one important characteristic by which we distinguish ourselves from a police state. Id. at 462-63, 107 S.Ct. at 2510. Thus, while police, no less than anyone else, may resent having obscene words and gestures directed at them, they may not exercise the awesome power at their disposal to punish individuals for conduct that is not merely lawful, but protected by the First Amendment.
Re: criticism of judges, see Standing Committee of Discipline v. Yagman quoting Bridges v. California, 314 U.S. 252, 263 (1941):
"The assumption that respect for the judiciary can be won by shielding judges from published criticism wrongly appraises the character of American public opinion. For it is a prized American privilege to speak one's mind, although not always with perfect good taste, on all public institutions. And an enforced silence, however limited, solely in the name of preserving the dignity of the bench, would probably engender resentment, suspicion, and contempt much more than it would enhance respect."
Judge Kosinski is often named as one of the potential candidates for the U.S. Supreme Court.
Bonus II:
1. The question isn't whether Gates could have acted better under the circumstances--the question is what a government worker should do in someone else's house once he verifies there is no threat, no crime, and the owner wants him out.
2. Gates may have been outsmarted by the police officer. The officer probably couldn't arrest Gates inside his own home for "disorderly conduct," so he may have beckoned Gates outside, where he could plausibly argue that the public was affected or endangered by Gates' conduct.
Patrick S. says:
Based upon the holdings in the MA cases below, Dr. Gates' conduct did not even fall under the disorderly conduct statute. Whether this is an issue of the cop arresting him anyway or whether the cops were not properly trained on what is "disorderly conduct" in MA is another question:
In Commonwealth v. Mallahan, 72 Mass.App.Ct. 1103, 889 N.E.2d 77 (2008), a decision rendered last year, an appeals court held that a person who launched into an angry, profanity-laced tirade against a police officer in front of spectators could not be convicted of disorderly conduct.
In Commonwealth v. Lopiano, (2004) 805 N.E.2d 522, 60 Mass.App.Ct. 723 (2004), an appeals court held it was not disorderly conduct for a person who angrily yelled at an officer that his civil rights were being violated. [In this case, according to the officer, Defendant was "yelling at me, you're violating my civil rights, then he began yelling at Ms. Carins, why are you doing this to me, you'll never go through with this."]
The Massachusetts statute defining "disorderly conduct" used to have a provision that made it illegal to make "unreasonable noise or offensively coarse utterance, gesture or display," or to address "abusive language to any person present." Yet the courts have interpreted that provision to violate the Massachusetts Constitution's guarantee of freedom of speech. So police cannot lawfully arrest a person for hurling abusive language at an officer.
[See more law-related discussion here and Commonwealth v Feigenbaum, 404 Mass. 471 (1989)]
Bonus: Here are 9th Circuit Judge Alex Kosinski's comments on free speech, which apply to Gates' case:
See Duran v. City of Douglas (1990): [T]he First Amendment protects a significant amount of verbal criticism and challenge directed at police officers." [Houston v. Hill, 482 U.S. 451 at 461] The freedom of individuals to oppose or challenge police action verbally without thereby risking arrest is one important characteristic by which we distinguish ourselves from a police state. Id. at 462-63, 107 S.Ct. at 2510. Thus, while police, no less than anyone else, may resent having obscene words and gestures directed at them, they may not exercise the awesome power at their disposal to punish individuals for conduct that is not merely lawful, but protected by the First Amendment.
Re: criticism of judges, see Standing Committee of Discipline v. Yagman quoting Bridges v. California, 314 U.S. 252, 263 (1941):
"The assumption that respect for the judiciary can be won by shielding judges from published criticism wrongly appraises the character of American public opinion. For it is a prized American privilege to speak one's mind, although not always with perfect good taste, on all public institutions. And an enforced silence, however limited, solely in the name of preserving the dignity of the bench, would probably engender resentment, suspicion, and contempt much more than it would enhance respect."
Judge Kosinski is often named as one of the potential candidates for the U.S. Supreme Court.
Bonus II:
1. The question isn't whether Gates could have acted better under the circumstances--the question is what a government worker should do in someone else's house once he verifies there is no threat, no crime, and the owner wants him out.
2. Gates may have been outsmarted by the police officer. The officer probably couldn't arrest Gates inside his own home for "disorderly conduct," so he may have beckoned Gates outside, where he could plausibly argue that the public was affected or endangered by Gates' conduct.
Patrick S. says:
Based upon the holdings in the MA cases below, Dr. Gates' conduct did not even fall under the disorderly conduct statute. Whether this is an issue of the cop arresting him anyway or whether the cops were not properly trained on what is "disorderly conduct" in MA is another question:
In Commonwealth v. Mallahan, 72 Mass.App.Ct. 1103, 889 N.E.2d 77 (2008), a decision rendered last year, an appeals court held that a person who launched into an angry, profanity-laced tirade against a police officer in front of spectators could not be convicted of disorderly conduct.
In Commonwealth v. Lopiano, (2004) 805 N.E.2d 522, 60 Mass.App.Ct. 723 (2004), an appeals court held it was not disorderly conduct for a person who angrily yelled at an officer that his civil rights were being violated. [In this case, according to the officer, Defendant was "yelling at me, you're violating my civil rights, then he began yelling at Ms. Carins, why are you doing this to me, you'll never go through with this."]
The Massachusetts statute defining "disorderly conduct" used to have a provision that made it illegal to make "unreasonable noise or offensively coarse utterance, gesture or display," or to address "abusive language to any person present." Yet the courts have interpreted that provision to violate the Massachusetts Constitution's guarantee of freedom of speech. So police cannot lawfully arrest a person for hurling abusive language at an officer.
[See more law-related discussion here and Commonwealth v Feigenbaum, 404 Mass. 471 (1989)]
Monday, July 27, 2009
Tyler Cowen on Henry Louis Gates
Marginal Revolution's Tyler Cowen on the Henry Louis Gates arrest:
On the substance of the altercation I do not know the details but some time ago we decided, for better or worse, to give policemen a lot of discretion in intimidating individuals, including innocent individuals and especially African-Americans. I don't think we chose an optimum but it is disingenuous to be suddenly shocked by what happened.
I agree wholeheartedly. The real issue is the proper balance between individual rights and police power. Since 9/11, we've elevated the status of law enforcement personnel from well-compensated civil servants to heroes. As a result, many Americans believe police can do no wrong, and citizens must be highly respectful to law enforcement at all times--even in their own homes. Prof. Gates' arrest should have been an opportunity to re-examine this shift in values; however, by focusing on race rather than how police ought to behave in another person's home, we've lost a chance to discuss a topic important to all Americans.
On the substance of the altercation I do not know the details but some time ago we decided, for better or worse, to give policemen a lot of discretion in intimidating individuals, including innocent individuals and especially African-Americans. I don't think we chose an optimum but it is disingenuous to be suddenly shocked by what happened.
I agree wholeheartedly. The real issue is the proper balance between individual rights and police power. Since 9/11, we've elevated the status of law enforcement personnel from well-compensated civil servants to heroes. As a result, many Americans believe police can do no wrong, and citizens must be highly respectful to law enforcement at all times--even in their own homes. Prof. Gates' arrest should have been an opportunity to re-examine this shift in values; however, by focusing on race rather than how police ought to behave in another person's home, we've lost a chance to discuss a topic important to all Americans.
More Immigrants = More Safety
From Radley Balko, July 6, 2009:
http://www.reason.com/news/show/134579.html
Despite the high profile of polemicists such as Lou Dobbs and Michael Savage, America has been mostly welcoming to this latest immigration wave. You don't see "Latinos Need Not Apply" or "No Mexicans" signs posted on public buildings the way you did with the Italians and the Irish, two groups who actually were disproportionately likely to turn to crime. The implication makes sense: An immigrant group's propensity for criminality may be partly determined by how they're received in their new country.
"Look at Arab-Americans in the Midwest, especially in the Detroit area," Levin says. "The U.S. and Canada have traditionally been very willing to welcome and integrate them. They're a success story, with high average incomes and very little crime. That's not the case in Europe. Countries like France and Germany are openly hostile to Arabs. They marginalize them. And they've seen waves of crime and rioting."
I love the common sense.
http://www.reason.com/news/show/134579.html
Despite the high profile of polemicists such as Lou Dobbs and Michael Savage, America has been mostly welcoming to this latest immigration wave. You don't see "Latinos Need Not Apply" or "No Mexicans" signs posted on public buildings the way you did with the Italians and the Irish, two groups who actually were disproportionately likely to turn to crime. The implication makes sense: An immigrant group's propensity for criminality may be partly determined by how they're received in their new country.
"Look at Arab-Americans in the Midwest, especially in the Detroit area," Levin says. "The U.S. and Canada have traditionally been very willing to welcome and integrate them. They're a success story, with high average incomes and very little crime. That's not the case in Europe. Countries like France and Germany are openly hostile to Arabs. They marginalize them. And they've seen waves of crime and rioting."
I love the common sense.
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