From the WSJ Opinion Archives
|
No
Truck With Huck--II
If you were reading this column last week, you probably anticipated our second
reason for criticism of Mike Huckabee's presidential campaign: his support of
the so-called Fair Tax. Just to sum up, the Fair Tax proposes to eliminate all
existing federal taxes, including those on personal income, payroll and corporate
profits. Replacing them would be a heavy sales tax, just under 30%. (Fair Tax
proponents describe it as a 23% tax, a figure they reach by adding the tax before
calculating the percentage.)
What's wrong with this idea? Absolutely nothing, to hear the Fair Tax people tell it. It offers only benefits and imposes no costs. Mike Huckabee ascribes to it occult powers; he tells the New York Times that enacting the Fair Tax would be "like waving a magic wand, releasing us from pain and unfairness."
Fair Tax proponents claim that it would be "revenue neutral"--that is, it would raise the same amount overall as the current tax system does. This means one of the following three things (or a combination of the second and third):
- Everyone would pay the same amount in taxes as under the current system.
- Some people would pay less, but others would pay more.
- The tax would alter incentives in such a way as to increase economic growth, thereby making people richer without reducing revenues to the government.
We can dispense with the first possibility easily enough. Fair Tax proponents do not claim that everyone would pay the same in taxes under their system--a claim that would be both highly implausible and not much of a selling point (why radically redesign the tax system if the effect is zero?).
But revenue-neutrality remains a zero-sum game: If some taxpayers pay less, others will pay more. It stands to reason that under a system taxing only consumption, those hardest hit would be taxpayers with relatively low income and high consumption, such as young families with children and (as we noted Friday) elderly people living off their (already taxed) assets.
Fair Tax people respond to this point by saying they would counter the added burden with subsidies, which they call "prebates"--a deviation from the elegant simplicity that is the plan's biggest selling point. Still, no matter how complicated they make the system, there is no escaping simple arithmetic: If some taxpayers pay less, others are going to have to pay more, or else the plan is not revenue-neutral.
As we noted last week, Huckabee acknowledges that a few groups would pay more: "illegals, prostitutes, pimps, gamblers, drug dealers." This radically simple tax is so precisely targeted that only bad people will pay more. The rest of us will save so much, we can pool our resources and buy the Brooklyn Bridge.
What about the supply-side idea, that the Fair Tax would spur economic growth, thereby generating revenues by way of increased economic growth? The trouble with this is that the Fair Tax is almost ideally unsuited to take advantage of supply-side effects.
It is certainly true that lower tax rates can create incentives for economic activities, thereby increasing revenues. For example, lowering the capital gains tax to 15% prompted investors to unlock their gains, and thereby generated more revenues than the higher rate. But obviously there are limits to this phenomenon, which is why Laffer drew a curve rather than a line. If the capital gains tax were reduced to zero, revenues from it would be zero.
That is what the Fair Tax proposes to do, not only with capital gains, but with earned income, interest, dividends, corporate profits and all other forms of economic activity except consumption. Economic growth would produce revenues only to the extent that people spent more money.
Supply-side effects work on consumption taxes as well. When Congress slapped a "luxury tax" on yachts, people stopped buying yachts. The yacht-building industry was devastated; people working in it lost their jobs; and Congress ultimately repealed the tax. The Fair Tax would impose a 30% levy on all consumption, a powerful disincentive to spend money. People who need to spend money--including the young family and the elderly couple living off their assets--would get hit hard by the tax. Rich people, by contrast, would forgo luxuries or find ways around the tax.
When we wrote about the Fair Tax last week, we got lots of emails from readers demanding to know why we like the current tax system so much. Of course we don't like it at all, and we don't know of anyone who does. But as appealing as the Fair Tax may be, it is only a fantasy. A belief in magic is not a qualification for the presidency.
They
Didn't Beat Us, We Beat Ourselves
A troubling story from Princeton University turns out to be the product of a
troubled mind. The New York Sun describes the initial claim:
[Francisco] Nava, 23, is a politics major and a junior at Princeton who this semester has become an outspoken member of the Anscombe Society, a morally conservative student group that speaks out against same-sex marriage and pre-marital sex. Mr. Nava claimed that he has been receiving death threats since October after penning a column in the student newspaper, the Daily Princetonian, criticizing the university's campaign to distribute free condoms on campus as "tacit sponsorship of hookup sex." On Friday, he claimed he was attacked by two black-clad assailants and rendered unconscious after they repeatedly hit his head against a brick wall.
Over the weekend, Mr. Nava was recovering in the McCosh Health Center on campus. Visitors said his jaw was badly swollen, his face was covered with cuts and abrasions, and the inside of his mouth was bleeding.
Anscombe members Kevin Joyce, Jonathan Hwang and Sherif Girgis also received the death threats, as did Robert George, a professor whom the Daily Princetonian describes as having "publicly supported conservative causes, including the Anscombe Society's goal of promoting chastity."
But Nava's story began to unravel when it emerged, as FirstThings.com's Ryan Anderson first reported, that he had a high-school history of faking death threats:
Late [Friday] night, the president of the Anscombe Society, Kevin Joyce, e-mailed George, Hwang, and Girgis to report a startling discovery. He had heard from a friend that when Nava was at the Groton School he had fabricated an incident of hate-speech against his roommate and himself using the phrase "die fags!" (Nava's roommate was one of the founders of the Gay-Straight Alliance at Groton.)
Hwang, the student spending the night with Nava, picked up the message first and immediately asked Nava about the incident. Nava confirmed that it happened, but told Hwang that it had nothing to do with his assault; this wasn't a hoax. After Nava got out of bed, he walked into the kitchen and asked to speak with Professor George alone. George took him into another room in the house and Nava told George all about the Groton incident.
George tells me that Nava described it as a "bad part of his past" and that Nava was insistent that the assault on him had not been fabricated. Nava explained to George that at the time of the Groton incident his father had recently passed away, he was suffering from depression, and he was deeply homesick. Nava thought a threat on his life would convince his mother to let him come home. Eventually the school discovered that Nava was behind the alleged hate crime, and punished him duly.
This made it less surprising when it turned out the Princeton beating was a hoax: "During the course of the investigation, there were some inconsistencies, which we presented to him and he admitted," a cop tells the Sun.
This sort of thing is not unprecedented: We've noted cases in the past in which left-wing campus figures have staged "hate crimes" against themselves in order to win attention or sympathy. Nava's high school episode would seem to be just such a case. His Princeton repeat underscores that there's a big difference between political ideology and basic integrity.
Promises,
Promises
From CNN:
Former President Bill Clinton said Monday that the first thing his wife Hillary will do when she reaches the White House is dispatch him and his predecessor, President George H.W. Bush, on an around-the-world mission to repair the damage done to America's reputation by the current president--Bush's son, George W. Bush.
"Well, the first thing she intends to do, because you can do this without passing a bill, the first thing she intends to do is to send me and former President Bush and a number of other people around the world to tell them that America is open for business and cooperation again," Clinton said in response to a question from a supporter about what his wife's "number one priority" would be as president.
Did anyone check with Bush père to make sure he's on board with the plan to send him abroad to badmouth his son?
Also, if Mrs. Clinton really wanted to do this, couldn't she make her hubby leave the country now as a show of good faith?
Wannabe
Pundits
Who is he?
He hasn't declared war on anyone or obstructed justice or lied to the country about some extramarital affair.
Barack Obama? Mike Huckabee? Ron Paul?
Nope, Isiah Thomas, coach of the New York Knicks, as Chicago Tribune sportswriter Sam Smith notes.
The
Democrats Are Different!
If you think Nancy Pelosi hasn't accomplished anything as speaker of the House,
you've got another think coming, the San Francisco Chronicle reported yesterday:
Under Pelosi's signature "Green the Capitol" initiative, the House cafeterias will get a full-blown makeover Monday to the very latest in organic and locally grown cuisine under a new contract with Restaurant Associates, caterer to the Metropolitan Museum of Art and the Kennedy Center for the Performing Arts.
The vast House food service operation that feeds the belly of the beast - more than 2.5 million meals a year for members, staff, tourists, lobbyists, lawyers, journalists and other highly regarded species that inhabit the Capitol - is switching to locally grown, organic, seasonal and generally healthy food. It will be served in compostable sugar cane and corn starch containers instead of petroleum-based plastics. Even the knives and forks will be biodegradable.
The Senate, however, "is sticking to its fried okra and Styrofoam." We blame the filibuster.
Homer
Nods
Contrary to an item
yesterday, some voters in 1960 were born after 1939. Although the federal
voting age was still 21, states were free to allow younger voters. According
to the nonauthoritative Wikipedia.org, as of 1971, when the 26th Amendment was
ratified, the voting age was 18 in Georgia and Kentucky, 19 in Alaska, and 20
in Hawaii and New Hampshire.
Gray Lady Imitates Humor Mag
- "If You Don't Buy This Magazine, We'll Kill This Dog"--cover
blurb, National
Lampoon, January 1973
- "New York Times in Iraq[*]: 'Blackwater Shot Our Dog' "--headline, Reuters, Dec. 18
* Or, more accurately, the Nieuw Amsterdam Times in Mesopotamia, a homegrown extremist group that American intelligence agencies have concluded is foreign-led.
Life Imitates TV
- Dr. Johnny Fever: "Thanks for that on-the-spot report, Les.
For those of you who've just tuned in, the Pinedale Shopping Mall has just
been bombed with live turkeys. Film at eleven."--"WKRP
in Cincinnati," originally aired Oct. 30, 1978
- "Iraq Complains About Turkey Bombing"--headline, Associated Press, Dec. 17, 2007
To
Elizabeth Edwards Too
"Spiders Scarier Than Terrorism to Kids"--headline, Herald Sun (Melbourne,
Australia), Dec. 18
He
Couldn't Hold a Tune
"Singer Quits as Attorney General"--headline, Washington Times, Dec. 18
An
Odd Motive
"Man Accused of Stealing TVs to Have Jury Trial"--headline, Pantagraph
(Bloomington, Ill.), Dec. 18
'Just
Because You Bought Me Dinner, Don't Think You Can Expect Something'
"Can a 'Fertility Diet' Get You Pregnant?"--headline, New York Times,
Dec. 18
'Darling,
I Love It When You . . . Oh, Look! A Squirrel!'
"ADHD Adults Have More Money, Sex Problems"--headline, United Press
International, Dec. 17
Breaking
News From a Long Time Ago
"Distant Galaxy Threatened by 'Death Star' "--headline, CBC.ca,
Dec. 17
News You Can Use
- "How to Survive a Fall From a 47-Story High-Rise"--headline, FoxNews.com,
Dec. 16
- "Do the Late Shows Want Your Jokes? No!"--headline, Associated Press, Dec. 17
Bottom Stories of the Day
- "Some Motorists Illegally Pass Stopped School Buses"--headline,
Town
Talk (Alexandria, La.), Dec. 18
- "Pam Anderson Files for Divorce"--headline, Associated
Press, Dec. 17
- "Americans' Approval of Congress Sinks to New Low"--headline, USA Today, Dec. 18
Unwanted,
Dead or Alive
You have to wonder how the New York Times can report this sort of stuff and
keep a straight face:
Fidel Castro indicated Monday in a statement read on state television that he was willing to hand over the reins of Cuba's government to a younger generation of leaders. But his statement remained silent on whether he was speaking hypothetically or had a transition plan in mind.
"My basic duty is not to cling to office, nor even more so, to obstruct the rise of people much younger, but to pass on experiences and ideas whose modest value arises from the exceptional era in which I lived," said the statement attributed to Mr. Castro, who is 81.
The ailing Mr. Castro, acting in a sort of emeritus role, has produced numerous commentaries in the 16 months since he had abdominal surgery and temporarily handed over power to his younger brother, Raúl, who is 76.
So let's see. Castro, who has been Cuba's dictator for almost half a century, says his "duty is not to cling to office," though he isn't actually leaving just yet. One wonders how long he will have been dead by the time he finally does get around to stepping aside.
(Carol Muller helps compile Best of the Web Today. Thanks to Mark Hahn, Michael Segal, Ethel Fenig, Jonathan Owen, Dagny Billings, John Hoh, Tom Wolf, Jay Pittard, Tony Stalls, Robert Stelzer, Jim Orheim, Lewis Chilton, Ralph Mackiewicz, Mike Stevens, John Nernoff, Terry Holmes, Dennis McNeese, Mark Kellner, Bruce Goldman, Daniel Foty, Brian McDonald, Roger Heinig, Mark Bender, Ed Lasky, Daniel Sweeney, John Williamson, Lee Walus, Monty Krieger, Ed Jordan, Dan O'Shea and Steve Karass. If you have a tip, write us at opinionjournal@wsj.com, and please include the URL.)
Today on OpinionJournal:
- Review & Outlook: McCain's surge: Why he's making a primary comeback.
- Bret Stephens: Why Teddy Roosevelt claimed the seas.
- Jonathan Last: An outrageous story of eminent-domain abuse.
