tag:blogger.com,1999:blog-29574986371057570842024-02-19T06:30:20.246-05:00Another Amateur Economist"When plunder becomes a way of life for a group of men living together in society, they create for themselves in the course of time a legal system that authorizes it and a moral code that glorifies it." Frederic Bastiat 1801-1850 political economist __________________________________The velvet glove is off the golden fist. _________________________________________________________________________________________
PLUNDERFEST: Def: What the people of the United States can now look forward to.greghttp://www.blogger.com/profile/08201906679062960215noreply@blogger.comBlogger148125tag:blogger.com,1999:blog-2957498637105757084.post-55480431176020367402022-03-06T20:06:00.000-05:002022-03-06T20:06:05.884-05:00Cost of the War on Terror- Redraft<p> </p><p>All the money spent in Iraq and Afghanistan represents resources
destroyed. As of September, 2021, a study from Brown University
estimates the US has spent $8 Trillion on the 'War on terror. <br /></p><p>https://www.brown.edu/news/2021-09-01/costsofwar</p><p>But,
that's just money. How much, in terms of real resources, does $8
Trillion US, $8000 Billion US, represent? </p><p>Let's do residential. Median
value of a house in the United States is (these days) $275K Say $300K US per house,
on average.</p><p> That's about 24 million houses. The equivalent value
of 24 million houses which is not being invested, rather is being
destroyed in warfare. 24 million houses which are not being built. With 24 million houses figure 3 persons per house, housing for 72 million people. So the
residential equivalent of a several very large cities has being leveled.
This kind of calculation has been done, more accurately and in greater
detail, both nationally and for the share of one's locality, and can be
found by searching in say: 'cost of the war in Afghanistan'. </p><p><span class="blsp-spelling-error" id="SPELLING_ERROR_0">Nobody is</span>
being hurt though. But:
Let's look at it in terms of man lives. Average GDP per worker is
roughly, $23T/160M in the labor force, these days gives almost $150K per
worker per year. So the cost is about 50M man years. Figure 40 years productive life:
So,at current dollar value about $6M per life. So: $8000B/$6M = 1.25 Million lives. So the war on Terror has
destroyed the lifetime production of 1 and a quarter million American men and women. Economically
speaking, these are the casualties the US has sustained. </p><p>Let's check the nuclear option. When you nuke a city, you destroy only
half the lifetime productive capacity of the population (half has
already been contributed) so DOUBLE the number of people killed. So we get 2.5 Million. Note we are now considering everyone in our city as labor or
potential labor. </p><p>Now the total capital of the US is about $70T. Divide
by total people (330M) and you get about $210K per person, of physical
capital, that is houses, factories, offices, roads, utilities, etc. these people
occupy and use. An interesting number in its own right. But we'll use
$200K. So that's $ 500B worth of capital our 2.5 Million people occupy and use.
(200K x 2.5 M.) Figure $500B to be the equivalent of 125K man lives.
($500B/$6M = 83K man lives.) We subtract 83K man lives because we're
blowing up their productive lives equivalent in material destruction,
giving 2.4 million man lives. We're subtracting it because we don't want to count it
twice. But we see that counting the actual material that is blown up is
just a small correction. We can just as well ignore it, given the
approximate nature of all our numbers</p><p> So, roughly, the War on Terror has, so far, cost the economic equivalent
of the total destruction of a city of 2.5 million people. Give or
take. <br /></p><p>That's everyone and everything in it. So that's somewhere between Chicago (Pop 2.7 million,) and Houston (Pop 2.3 million) So: Take the city of Houston, kill all the people, level it. replace it with waste: The cost to the United States of its 'War on Terror.' <br /></p><p>That's a lot of economic terror the United States has inflicted on its own people to prosecute the "War on Terror. "
Of course ‘economic equivalent’ <span class="blsp-spelling-error" id="SPELLING_ERROR_1">does no</span>t
include pain and suffering. Or cleanup. </p><p>Most of the numbers we've used understate the answer. One can argue that
we understate the earnings per man life, but don't forget capital is
spent on the individual at both the beginning and end of his life, so
the net contribution of a person to society is probably considerably
less than 40 years of labor.
By our calculations 9/11 resulted in the destruction of something under 5
thousand man lives of production. The War on Terror is, it seems, a
rather disproportionate response. The City of Houston for a couple of tall office towers.<br /></p><p>But then, one can always claim the US actions in WWII
were a disproportionate response to Pearl Harbor.</p>greghttp://www.blogger.com/profile/08201906679062960215noreply@blogger.com0tag:blogger.com,1999:blog-2957498637105757084.post-49090776962694283742022-03-06T13:37:00.001-05:002022-03-06T13:37:54.370-05:00The Nuclear Equivalent to the War on Terror<p>All the money spent in Iraq and Afghanistan represents resources destroyed. As of September, 2021, a study from Brown University estimates the US has spent $8 Trillion. <br /></p><p>https://www.brown.edu/news/2021-09-01/costsofwar</p><p>But, that's just money. How much, in terms of real resources, does $8 Trillion US, $8000 Billion US, represent? Let's do residential. Medial value of a house in the United States is $140K. (2010) </p><p> That's about 7 million houses. The equivalent value of 7 million houses which is not being invested, rather is being destroyed in warfare. 7 million houses which are not being built.
7 million houses figure 4 persons per house, 28 million people. So the residential equivalent of a several very large cities has being leveled. This kind of calculation has been done, more accurately and in greater detail, both nationally and for the share of one's locality, and can be found by searching in say: 'cost of the war in Afghanistan'. <span class="blsp-spelling-error" id="SPELLING_ERROR_0">Nobody is</span> being hurt though. But:
Let's look at it in terms of man lives. Average GDP per worker is roughly, $14T/140M in the labor force, these days gives $100K per worker. So the cost is 10M man years. Figure 40 years productive life: $4M per life. So: $1000B/$4M = 250K lives. So the war on Terror has destroyed the lifetime production of 250 thousand men. Economically speaking, these are the casualties the US has sustained.
Let's check the nuclear option. When you nuke a city, you destroy only half the lifetime productive capacity of the population (half has already been contributed) so DOUBLE the number of people killed. Figure 500K. Note we are now considering everyone in our city as labor or potential labor. Now the total capital of the US is about $50T. Divide by total people (300M) and you get about $170K per person, of physical capital, that is houses, factories, offices, roads, utilities, etc. they occupy and use. An interesting number in its own right. But we'll use $200K. So that's $100B worth of capital our 500K people occupy and use. (200K x 500K.) Figure $100B to be the equivalent of 25K man lives. ($100B/$4M = 25K man lives.) We subtract 25K man lives because we're blowing up their productive lives equivalent in material destruction, giving 475K. We're subtracting it because we don't want to count it twice. But we see that counting the actual material that is blown up is just a small correction. We can just as well ignore it, given the approximate nature of all our numbers
So, roughly, the War on Terror has, so far, cost the economic equivalent of the total destruction of a city of 500 thousand people. Give or take. That's everyone and everything in it. That's a lot of terrorism. Of course ‘economic equivalent’ <span class="blsp-spelling-error" id="SPELLING_ERROR_1">does no</span>t include pain and suffering. Or cleanup.
Most of the numbers we've used understate the answer. One can argue that we understate the earnings per man life, but don't forget capital is spent on the individual at both the beginning and end of his life, so the net contribution of a person to society is probably considerably less than 40 years of labor.
By our calculations 9/11 resulted in the destruction of something under 5 thousand man lives of production. The War on Terror is, it seems, a rather disproportionate response. But then, one can always claim WWII was a disproportionate response to Pearl Harbor.</p>greghttp://www.blogger.com/profile/08201906679062960215noreply@blogger.com2tag:blogger.com,1999:blog-2957498637105757084.post-65863704621410971752019-01-29T19:20:00.000-05:002020-01-28T01:03:32.966-05:00Variable VAT Tax to Regulate Resource and Product Flow in an Economy<br />
<div style="font-stretch: normal;">
Variable
VAT Tax to Regulate Resource and Product Flows in an Economy</div>
<div style="font-stretch: normal;">
<span style="font-family: "arial"; font-size: x-small;"></span><br /></div>
<div style="font-stretch: normal;">
So
the title pretty much says it all. Let's get to a few details.</div>
<div style="font-stretch: normal;">
<span style="font-family: "arial"; font-size: x-small;"></span><br /></div>
<div style="font-stretch: normal;">
If
the government imposes a sales tax on an item, not only do we expect an increase
in tax revenue, but we also expect an increase in the price of the item.* For almost
all goods, (and here we will ignore any possible exceptions,) the quantity
demanded will also decline. Because of this, a sales tax may be used to
regulate the demand for, and therefore, although perhaps after some delay, the
production of, a given product. By increasing the sales tax, both demand and
production will be reduced. By reducing the tax, demand for and production of, a
product will be increased, over the current quantity demanded.</div>
<div style="font-stretch: normal;">
<span style="font-family: "arial"; font-size: x-small;"></span> </div>
<div style="font-stretch: normal;">
Now,
there is no particular reason why we should restrict ourselves to a positive
tax, if for some reason,we wish to stimulate demand for a product beyond the
present demand. We can impose a negative.sales tax on a particular product
sold. The price to the buyer will go down, the quantity demanded will increase,
and production will eventually rise to meet this subsidized demand.</div>
<div style="font-stretch: normal;">
<span style="font-family: "arial"; font-size: x-small;"></span><br /></div>
<div style="font-stretch: normal;">
And
of course, there is no reason to restrict such a variable tax to finished goods
or services. It can be imposed at any point in any market in any supply chain.
Indeed, in countries with a VAT, the mechanism for such regulation and control
of production is already in place.</div>
<div style="font-stretch: normal;">
<span style="font-family: "arial"; font-size: x-small;"></span><br /></div>
<div style="font-stretch: normal;">
With
such a tax in place, resources can be directed to any place in an economy. In
particular, resources can be directed to where they are most needed, say in
response to some disaster, and not just to where the demand is greatest. Indeed,
society's current practice of meeting any particular demand, that is, responding
to some local surplus of money, may not always be in the best interests of the
society, or its economy. </div>
<div style="font-stretch: normal;">
</div>
<div style="font-stretch: normal;">
If,
for instance, more infrastructure is needed, demand in that sector can be
increased, while at the same time reducing the demand in other, more
discretionary sectors,where resources may be being inefficiently used, or even
wasted.</div>
<div style="font-stretch: normal;">
<span style="font-family: "arial"; font-size: x-small;"></span><br /></div>
<div style="font-stretch: normal;">
In
the case of imports and exports, the same mechanism of variable taxation may be
used. A goal, here, of course, might be to establish a balance between the value
of imports and exports. Another might be to encourage an export of finished
goods, and encourage an import of factors of production.</div>
<div style="font-stretch: normal;">
<span style="font-family: "arial"; font-size: x-small;"></span> </div>
<div style="font-stretch: normal;">
And
of course, this system of allocation could be made completely transparent.</div>
<div style="font-stretch: normal;">
<span style="font-family: "arial"; font-size: x-small;"></span> </div>
<div style="font-stretch: normal;">
Naturally,
there are many technical details which would have to be dealt with, most
particularly how to deal with the relative differences in the elasticities of
supply and demand for any given product or factor of production. However, I am
confident that such difficulties can be worked out.</div>
<div style="font-stretch: normal;">
<span style="font-family: "arial"; font-size: x-small;"></span><br /></div>
<div style="font-stretch: normal;">
The
main obstacles I see to the establishment of this, or indeed, any rational
system of allocation of resources in an economy, to be political.<br />
________________<br />
*Almost always. The only possible exceptions would seem to involve a completely elastic supply base, with a high margin of profit above cost capable of completely absorbing the tax. The price may not change, as the profit would decline by the amount of the tax.<br />
<br />
With totally elastic supply, however, the price is generally driven down to cost by competition, and the margin of profit is at or near zero.</div>
greghttp://www.blogger.com/profile/08201906679062960215noreply@blogger.com0tag:blogger.com,1999:blog-2957498637105757084.post-68370630868273221632018-12-31T08:37:00.001-05:002019-03-20T14:43:03.943-04:00Links to QuoraBack, and it's been two whole days! So I'm going to post links to (some of ) my answers in economics on Quora, here, just so they're all in one place. In no particular order. For your convenience.<br />
<br />
<a href="https://www.quora.com/Would-the-world-economy-benefit-or-suffer-from-a-sudden-revival-of-the-Gold-Standard/answer/Charles-St-Pierre">https://www.quora.com/Would-the-world-economy-benefit-or-suffer-from-a-sudden-revival-of-the-Gold-Standard/answer/Charles-St-Pierre</a> Mostly suffer<br />
<br />
<br />
<a href="https://www.quora.com/Do-you-think-that-a-Robot-tax-should-be-used-to-curb-automation-taking-too-many-jobs/answer/Charles-St-Pierre">https://www.quora.com/Do-you-think-that-a-Robot-tax-should-be-used-to-curb-automation-taking-too-many-jobs/answer/Charles-St-Pierre</a><br />
<br />
<a href="https://www.quora.com/Is-there-a-fundamental-flaw-in-the-free-market-theory-that-leads-to-the-deprivation-of-property-and-concentration-of-economic-power-through-debt/answer/Charles-St-Pierre" target="_blank"> https://www.quora.com/Is-there-a-fundamental-flaw-in-the-free-market-theory-that-leads-to-the-deprivation-of-property-and-concentration-of-economic-power-through-debt/answer/Charles-St-Pierre </a>And see my comment at the bottom.<br />
<a href="https://www.blogger.com/goog_28142932"><br /></a>
<a href="https://www.quora.com/What-is-wrong-with-America-2/answer/Charles-St-Pierre">https://www.quora.com/What-is-wrong-with-America-2/answer/Charles-St-Pierre</a><br />
<a href="https://www.blogger.com/goog_1029667006"><br /></a>
<a href="https://www.blogger.com/goog_1712073137"><br /></a>
<a href="https://www.quora.com/Should-the-economy-of-a-country-always-be-growing-If-it-is-not-possible-could-it-mean-that-the-thesis-of-the-capitalism-is-wrong/answer/Charles-St-Pierre">https://www.quora.com/Should-the-economy-of-a-country-always-be-growing-If-it-is-not-possible-could-it-mean-that-the-thesis-of-the-capitalism-is-wrong/answer/Charles-St-Pierre</a><br />
<br />
<br />
<br />
<a href="https://www.quora.com/Why-should-I-hate-free-markets/answer/Charles-St-Pierre">https://www.quora.com/Why-should-I-hate-free-markets/answer/Charles-St-Pierre</a> Why you should<i> fear</i> free markets<br />
<br />
<br />
<a href="http://www.atimes.com/article/pboc-injects-record-83-billion-into-the-financial-system/?utm_source=quora&utm_medium=referral">PBOC injects record $83 billion into the financial system - Asia Times</a> So this was reposted to Quora, I posted a comment there suggesting that the financial system was the wrong place to put the money. They should instead have a negative sales tax. This would pretty immediately stimulate demand, and make everybody happier at the same time.<br />
<br />
<br />
<br />
<br />
However, further thoughts occurred to me, which I (will) discuss above.<br />
<br />
<a href="https://www.quora.com/Would-the-economy-run-better-if-we-got-rid-of-all-government-control-and-destroyed-monopolies-it-creates/answer/Charles-St-Pierre">https://www.quora.com/Would-the-economy-run-better-if-we-got-rid-of-all-government-control-and-destroyed-monopolies-it-creates/answer/Charles-St-Pierre</a><br />
Government and the role of violence.greghttp://www.blogger.com/profile/08201906679062960215noreply@blogger.com0tag:blogger.com,1999:blog-2957498637105757084.post-30806842830582898632018-12-29T14:58:00.000-05:002019-12-02T01:08:21.566-05:00Moving My ActivityDue to the underwhelming response to my posts on this web site, I have moved my activity here to <b>Quora.</b><br />
<b><br /></b>
A few parting thoughts:<br />
<br />
<div style="text-align: start;">
<span style="text-align: center;"> It is important to determine what is important.</span></div>
<div style="text-align: start;">
<span style="text-align: center;"> </span></div>
<div style="text-align: start;">
<span style="text-align: center;"> *</span></div>
<div style="text-align: start;">
<span style="text-align: center;"><br /></span></div>
<div style="text-align: start;">
<span style="text-align: center;"> People who are paid to think, think what they are paid to think.</span></div>
_______________<br />
<br />
<br />
And:<br />
<div style="text-align: left;">
"It ain't what you don’t know that gets you into trouble. </div>
<div style="text-align: left;">
<br /></div>
<div style="text-align: left;">
It's what you know for sure that just ain’t so."</div>
<div style="text-align: left;">
<br /></div>
<div style="text-align: left;">
Mark Twain (1835 - 1910) American Author*</div>
<div style="text-align: left;">
_____________</div>
<div style="text-align: left;">
<br /></div>
<div style="text-align: left;">
<br /></div>
<div style="text-align: left;">
Finally, this little dose of concentrated wisdom from Terry Pratchett (1948-2015) British Author </div>
<div style="text-align: left;">
From <i>Carpe Jugulum, (</i>with thanks to Elspeth Cowrie and her answer at <b>Quora</b>)<span style="color: #333333; font-family: "q_serif" , "georgia" , "times" , "times new roman" , "hiragino kaku gothic pro" , "meiryo" , serif; font-size: 16px; line-height: 28px;"> </span></div>
<div style="text-align: left;">
<span style="color: #333333; font-family: "q_serif" , "georgia" , "times" , "times new roman" , "hiragino kaku gothic pro" , "meiryo" , serif; font-size: 16px; line-height: 28px;"><br /></span></div>
<blockquote style="border-left-color: rgb(226, 226, 226); border-left-style: solid; border-left-width: 2px; color: #666666; font-family: q_serif, Georgia, Times, 'Times New Roman', 'Hiragino Kaku Gothic Pro', Meiryo, serif; font-size: 16px; line-height: 28px; margin: 0px 0px 1em; padding-left: 1em;">
<div class="ui_qtext_para" style="margin-bottom: 1em; padding: 0px;">
"And that's what your holy men discuss, is it?" [asked Granny Weatherwax.]</div>
<div class="ui_qtext_para" style="margin-bottom: 1em; padding: 0px;">
"Not usually. There is a very interesting debate raging at the moment on the nature of sin. for example." [answered Mightily Oats.]</div>
<div class="ui_qtext_para" style="margin-bottom: 1em; padding: 0px;">
"And what do they think? Against it, are they?"</div>
<div class="ui_qtext_para" style="margin-bottom: 1em; padding: 0px;">
"It's not as simple as that. It's not a black and white issue. There are so many shades of grey."</div>
<div class="ui_qtext_para" style="margin-bottom: 1em; padding: 0px;">
"Nope."</div>
<div class="ui_qtext_para" style="margin-bottom: 1em; padding: 0px;">
"Pardon?"</div>
<div class="ui_qtext_para" style="margin-bottom: 1em; padding: 0px;">
"There's no greys, only white that's got grubby. I'm surprised you don't know that. And sin, young man, is when you treat people like things. Including yourself. That's what sin is."</div>
<div class="ui_qtext_para" style="margin-bottom: 1em; padding: 0px;">
"It's a lot more complicated than that--"</div>
<div class="ui_qtext_para" style="margin-bottom: 1em; padding: 0px;">
"No. It ain't. When people say things are a lot more complicated than that, they means they're getting worried that they won't like the truth. People as things, that's where it starts."</div>
<div class="ui_qtext_para" style="margin-bottom: 1em; padding: 0px;">
"Oh, I'm sure there are worse crimes--"</div>
<div class="ui_qtext_para" style="display: inline; margin-bottom: 1em; padding: 0px;">
"But they <i>starts</i> with thinking about people as things."</div>
</blockquote>
____________________<br />
<br />
Thank you for your time and attention.<br />
<br />
<i>Another Amateur Economist</i><br />
<i> _____________________</i><br />
*I have since learned that this attribution is unlikely.<br />
<br />
<div style="text-align: left;">
<br /></div>
greghttp://www.blogger.com/profile/08201906679062960215noreply@blogger.com0tag:blogger.com,1999:blog-2957498637105757084.post-54147433654106390812017-11-15T22:06:00.000-05:002017-11-15T22:07:45.411-05:00Link to: "Researchers chart rising inequality across millennia"This link is too good to pass up, especially as our Republican Congress debates lowering taxes for the wealthy.<br />
<h1 class="page_title">
<span style="font-size: small;">"Researchers chart rising inequality across millennia
</span></h1>
<span style="font-size: small;">
</span><br />
<div class="summary">
<span style="font-size: small;">Findings have profound implications for contemporary society"</span><br />
<br /></div>
<a href="https://www.eurekalert.org/pub_releases/2017-11/wsu-rcr110917.php">https://www.eurekalert.org/pub_releases/2017-11/wsu-rcr110917.php</a><br />
<br />
<br />
One paragraph: "Their findings, published this week in the journal <i>Nature</i>, have
profound implications for contemporary society, as inequality
repeatedly leads to social disruption, even collapse, said Tim Kohler,
lead author and Regents professor of archaeology and evolutionary
anthropology at Washington State University. The United States, he
noted, currently has one of the highest levels of inequality in the
history of the world."greghttp://www.blogger.com/profile/08201906679062960215noreply@blogger.com0tag:blogger.com,1999:blog-2957498637105757084.post-6188845113424807012017-11-15T00:39:00.000-05:002017-11-15T00:39:50.564-05:00The Purposes to Taxation<span id="__w2_nMBAlkW_answer_story"><span id="__w2_DsikSYX_answer_story"><span class="rendered_qtext"></span></span></span><br />
<div class="qtext_para">
There are four purposes to taxation.</div>
<div class="qtext_para">
<br /></div>
<div class="qtext_para">
1:
Destroy money. The government doesn’t need to tax to spend money. It
just has to write the check. However, money it spends adds to the money
supply, and this would cause inflation if an equal amount of money
wasn’t taken out of circulation or destroyed. If money is taken out of
circulation but not destroyed, as when the government borrows to spend,
(which it rarely has any need to,) and this money is accumulated by the
financial sector, the potential for inflation remains, and increases as
the amount of money in the financial sector increases.</div>
<div class="qtext_para">
<br /></div>
<div class="qtext_para">
2:
Discourage certain behaviors, or, through negative taxes, ie subsidy,
(a word for particular forms of spending,) encourage certain (other)
behaviors. All spending, of course, encourages the production of what it
is being spent on. (Allowing for profits, of course.)</div>
<div class="qtext_para">
<br /></div>
<div class="qtext_para">
3:
Redistribute demand, and therefore wealth. More or less egalitarian
societies, such as democracies, cannot survive an excess of economic
inequality. Money represents economic rights. That is, economic rights
are proportional to wealth and income. Economic rights cannot be
completely separated from political rights. An unequal distribution of
economic rights results in an unequal distribution of political rights.
This phraseology, however, is sort of a contradiction, since political
rights may implicitly be regarded as those rights held, and that wealth
shared, equally by all citizens in a society. Precisely: <i>The only difference between economic rights and political rights is the method of allocation</i>, <i>and their resulting distribution</i>.
A more proper phrasing, then, would be that increasing economic
inequality results in an increasing conversion of political rights to
economic rights. A sufficiently progressive tax system can prevent this
from arising, and so help to maintain a system of political rights. An
egalitarian government, therefore, will tax economic rights, so limiting
the scope and degree of inequality, and subsidize political rights, so
enlarging the scope and degree of equality. The dynamics and stability
of this process is itself interesting, but beyond the scope of this
question. However, the first goal of every proto- oligarchy is the
reduction of the progressivity of taxation to a level insufficient to
prevent the increasing of economic inequality.</div>
<div class="qtext_para">
<br /></div>
<div class="qtext_para">
4:
Validate its currency. By requiring that taxes be paid in its unit of
money, the use of that money is (very strongly) encouraged in that
economy. Since using a single unit of money increases economic
efficiency, this increases the quantity of free resources in that
economy. This increases both the rate of sustainable consumption, and
the rate of wealth accumulation in that economy.</div>
greghttp://www.blogger.com/profile/08201906679062960215noreply@blogger.com0tag:blogger.com,1999:blog-2957498637105757084.post-46967565892018336462017-08-18T21:06:00.001-04:002017-08-19T00:40:30.024-04:00How Misleading are Solar Yeilds?-- A LinkHere is an excellent discussion by Gail Tverberg, over at oilprice.com: How Misleading are Solar Yields?.<br />
<a href="https://www.blogger.com/goog_532078744"><br /></a>
<a href="http://oilprice.com/Energy/Energy-General/How-Misleading-Are-Solar-Yields.html">http://oilprice.com/Energy/Energy-General/How-Misleading-Are-Solar-Yields.html</a><br />
<br />
<br />
<br />
While yes the main topic is indeed that named in the title, she also goes into an excellent discussion of Energy Return on Energy Investment (EROEI: It is the ratio of energy spent to the energy produced. ) and its origins as a measure if energy return on human (and animal) labor.<br />
<br />
She also deals with some important social issues when this ratio drops too low. Societal collapse seems alarmist, but others like inability of governments to collect sufficient taxes, seem to describe our current situation. She refers to this book:<br />
<br />
<div class="a-row a-spacing-small">
<div class="a-row a-spacing-none scx-truncate-medium s-list-title-long">
<span class="a-size-small a-color-secondary">The Upside of Down: Catastrophe, Creativity, and the Renewal of Civilization</span><br />
<span class="a-size-small a-color-secondary">Jan 31, 2008</span></div>
<div class="a-row a-spacing-none">
<span class="a-size-small a-color-secondary">by </span><span class="a-size-small a-color-secondary">Thomas Homer-Dixon</span></div>
</div>
<a href="https://www.amazon.com/dp/1597260657/_encoding=UTF8?coliid=I1NCYEBK5PCSU7&colid=1U07S0MRX94Z1" target="_blank">https://www.amazon.com/dp/1597260657/_encoding=UTF8?coliid=I1NCYEBK5PCSU7&colid=1U07S0MRX94Z1</a><br />
<br />
Her basic point is that the EROEI on PV Panel is (Probably grossly) overestimated. She's probably right about that to some degree, since mostly we settle for industry figures. The complementary problem for oil, however, is that domestic oil production is also heavily subsidized which means we don't really know the true cost of extraction, and neither do we know the EROEI on it. <br />
<br />
In any case, the EROEI is certain to be less than we have historically been used to. This has two implications: The first is that we must devote a larger share of the economy to developing and maintaining our energy supply. And the second is that we will not be able to live as comfortably as we are used to. If our unequal society is unable to adapt to this new condition, it will not survive, and this would be catastrophic.<br />
<br />
While some of the issues in measurement of EROEI return on PVs she raises I believe can be addressed, it is an important discussion of these issues, and as I indicated above EROEI issues in general.greghttp://www.blogger.com/profile/08201906679062960215noreply@blogger.com0tag:blogger.com,1999:blog-2957498637105757084.post-84425813208849778992017-07-31T23:43:00.000-04:002019-04-27T00:36:25.831-04:00Generalizations in Interpreting Supply and Demand DiagramsIn a recent post <a href="https://anamecon.blogspot.com/2017/05/hidden-benefits-of-taxes.html">Hidden Benefits of Taxes</a> we argued that while a tax wedge reduced allocative efficiency, it increased productive efficiency. With a tax wedge, a portion of the remaining Social Surplus was allocated to the government, the Harberger Triangle in the diagram being discarded since it was no longer being (inefficiently) produced. Inefficient production is a waste of resources, often irreplaceable ones. For a very nice post on this issue, see this book review of: "Capitalism 3.0 A Guide To Reclaiming The Commons" <a href="https://www.amazon.com/s/ref=nb_sb_noss_2?url=search-alias%3Dstripbooks&field-keywords=Capitalism+3.0">https://www.amazon.com/s/ref=nb_sb_noss_2?url=search-alias%3Dstripbooks&field-keywords=Capitalism+3.0</a> (2006) book by Peter Barnes,over at <a href="http://portraitofthedumbass.blogspot.com/">Portrait of the Dumbass</a><br />
<br />
So. Consider the situation where the source of a product, the factory or the mine, is far from the consumer, and the cost of transport is significant.<br />
The shipper must cover the cost of transport, so the price the consumer is going to have to pay will be much higher than the shipper pays the producer. We also observe that the quantity bought from the producer will ordinarily be the same as the quantity sold to the consumer. And we see that if we draw a diagram of the entire process, including the cost of transport, we have an identical diagram as if we had a tax wedge: The wedge now going to cover the costs of transport, instead of going to government coffers.<br />
<br />
<div class="separator" style="clear: both; text-align: center;">
<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEg8Y67odSny-vj1pEvP18oU75UixQy-FZaKvcEGVZmGPcRWGRtERUFc8Ry7euIQ_g_bxpyqsoFNCuHesLEAGdHDaGSbHXLLPu6zUQqvsY-qHemhamoWP2VVUCPGNolbvBcO7Raue0o0-Hb6/s1600/Transport+Wedge+1.png" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="430" data-original-width="427" height="400" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEg8Y67odSny-vj1pEvP18oU75UixQy-FZaKvcEGVZmGPcRWGRtERUFc8Ry7euIQ_g_bxpyqsoFNCuHesLEAGdHDaGSbHXLLPu6zUQqvsY-qHemhamoWP2VVUCPGNolbvBcO7Raue0o0-Hb6/s400/Transport+Wedge+1.png" width="396" /></a></div>
Now the wedge covers all transport costs <span style="font-size: small;"><span style="font-family: "arial" , "helvetica" , sans-serif;"><b>T</b></span></span> so we can consider it as the resources consumed to include those that are necessary to support the capital involved in the transport. This would as well include any retained surplus. What was actually surplus and what was cost to the shipper is not yet defined by the diagram. Where the infrastructure costs are zero, the wedge is merely the costs incurred by the shipper.<br />
<br />
We note that high transport costs imply that the productive costs must be low, since only the most eager and wealthy of consumers are willing to pay the high prices for the product. Productive efficiency, <i>per se, </i>must be high. There is thus a large Allocative loss, but also correspondingly large deferred costs.<br />
<br />
Now, where transport costs are low, we see that there is still a market for those goods which are produced at a higher cost, with less efficient processes, among those with a lower inclination to pay. With a lowering of transport costs, there is an increase in allocative efficiency, a reduction in allocative loss, and a reduction of productive efficiency<br />
<br />
However, there is another way of looking at low transport costs. We can say that lower amount of resources given over to transportation support a smaller infrastructure. <br />
<br />
<div class="separator" style="clear: both; text-align: center;">
<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgx25nNdSiWHupfF8qGgl6BSOvueJPBFSd3nHk-9sM_3shoSiY_fFmiKZfzXkepp8Yn9hOBNIpbwhsebtHRaEsBMVBPjlTnt4C3adsdapEa4nzflQYy-P0jKQzHDhYQ-vcMRiU67aHQ0IZ0/s1600/Transport+Wedge3.png" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="430" data-original-width="427" height="400" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgx25nNdSiWHupfF8qGgl6BSOvueJPBFSd3nHk-9sM_3shoSiY_fFmiKZfzXkepp8Yn9hOBNIpbwhsebtHRaEsBMVBPjlTnt4C3adsdapEa4nzflQYy-P0jKQzHDhYQ-vcMRiU67aHQ0IZ0/s400/Transport+Wedge3.png" width="396" /></a></div>
<div class="separator" style="clear: both; text-align: center;">
</div>
So we can consider a rectangular wedge in any situation where there is a cost between supplier and consumer, and the quantity supplied does not change.<br />
<br />
Now we will define a community to consist of consumers and the local businesses to support them. The supplier will input into this community.<br />
The supplier will sell to the local businesses, who sell the input to the consumers. The difference between the price the businesses pay and the price the consumers pay the businesses, times the quantity supplied by the businesses, is seen to support the businesses.<br />
<div class="separator" style="clear: both; text-align: center;">
<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiqEO26hUXpMF8kS9svJ4axTaSgX6DjHoGAHT6ZHLjw2jLfxPyFqxqtnHrUV1WEVL0YywT3BeW8DJAp_t5RstZfQswFNxLtEEjmmHQ-8YzL8NRMmVORR_E1OJjptsMEKDwCcVKu8X0n5zss/s1600/Transport+Wedge+1Community.png" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="430" data-original-width="700" height="392" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiqEO26hUXpMF8kS9svJ4axTaSgX6DjHoGAHT6ZHLjw2jLfxPyFqxqtnHrUV1WEVL0YywT3BeW8DJAp_t5RstZfQswFNxLtEEjmmHQ-8YzL8NRMmVORR_E1OJjptsMEKDwCcVKu8X0n5zss/s640/Transport+Wedge+1Community.png" width="640" /></a></div>
<br />
The interesting thing is that the size of this wedge, that is, the size of the business sector in the community, depends on the inefficiencies involved in the conveyance of the input from the suppliers to the consumers. A totally efficient conveyance between supplier and consumer would eliminate any business sector in the community.<br />
<div class="separator" style="clear: both; text-align: center;">
<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgoBRUCDxnJtgrQvakfjMAYevgYqSfk2q4gVCG6ZefVJXO26Y9clDohudoX9utzHxtFh9SY7uw-ka_H29lOPh4BX509LGwPgDAb75b-4Bl2b-KTtIXFQEZjj08TXZhQJE1tW8rpQ5ghBsc0/s1600/Transport+Wedge4Community.png" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="430" data-original-width="725" height="377" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgoBRUCDxnJtgrQvakfjMAYevgYqSfk2q4gVCG6ZefVJXO26Y9clDohudoX9utzHxtFh9SY7uw-ka_H29lOPh4BX509LGwPgDAb75b-4Bl2b-KTtIXFQEZjj08TXZhQJE1tW8rpQ5ghBsc0/s640/Transport+Wedge4Community.png" width="640" /></a></div>
<br />
<br />
The point is, while from one point of view this wedge is wasted resources, from another point of view it supports the business sector of the community. And from that point of view it is not wasted at all. Indeed, let us look at the worst possible alternative to the community: Suppose a more efficient supplier is able to provide inputs directly to the consumer, at just below the price community business would have been able to supply them. We see that the consumer is marginally better off, but the business sector of the community has essentially been destroyed. Virtually the entire surplus has been absorbed by the supplier, and the surplus which would have gone into the community to support the business sector is denied the community.. <br />
<br />
<br />
<br />
Where the transport costs become low, it may become in the interests of the society to increase the tax wedge, in order to maintain productive efficiency. And see the previous discussion at <a href="http://anamecon.blogspot.com/2017/05/hidden-benefits-of-taxes.html">http://anamecon.blogspot.com/2017/05/hidden-benefits-of-taxes.html</a>greghttp://www.blogger.com/profile/08201906679062960215noreply@blogger.com1tag:blogger.com,1999:blog-2957498637105757084.post-4649117651887261212017-06-30T23:35:00.000-04:002017-06-30T23:35:23.111-04:00Obligations of the Wealthy<div class="western" style="line-height: 100%; margin-bottom: 0in;">
What
obligations do capitalists have to their society? Any? Or is it only
the money?
</div>
<div class="western" style="line-height: 100%; margin-bottom: 0in;">
<br />
</div>
<div class="western" style="line-height: 100%; margin-bottom: 0in;">
Consider
somebody who works for a living. Family. Wife and children. Hard
worker. Maybe overtime. He has time and resources to look after his
own affairs. But does he have time to look at the bigger picture?
And even if he had the time, would he have the opportunity. Would he
have the education?</div>
<div class="western" style="line-height: 100%; margin-bottom: 0in;">
<br />
</div>
<div class="western" style="line-height: 100%; margin-bottom: 0in;">
Probably
not. Indeed, in most cases, a person cannot look after larger
interests than his own. Yet, each person is as dependent on this
bigger picture as he is of his job. Indeed, one of the people he is
most dependent on is his boss. His boss can make his job miserable or
pleasant. He can fire him, in some places without any cause at all.
Just so, his boss is dependent on his own boss, and his boss on his
boss. And so on, up to the very wealthy and very powerful. And even
the self employed, even the small business owner is dependent on
those richer and more powerful than he is in society. After all,
they are able to spend vast sums of money, and alter the government
and the allocation of resources. Any one of these powerful could
destroy him, the worker, the self employed, the small business man,
purely incidentally, without thought, or regard. One has only to
look at the hundreds, perhaps thousands, of down towns destroyed by
Walmart, or the thousands of desolate factories, to know this is
true.</div>
<div class="western" style="line-height: 100%; margin-bottom: 0in;">
<br />
</div>
<div class="western" style="line-height: 100%; margin-bottom: 0in;">
We
are all dependent on what goes on beyond our horizons. And we look
to other people, those above us, those around us, to keep track of
what those things are. We have to.</div>
<div class="western" style="line-height: 100%; margin-bottom: 0in;">
<br />
</div>
<div class="western" style="line-height: 100%; margin-bottom: 0in;">
This
dependency is a socially necessary thing. Society could not exist
without it. A worker who was more concerned with the affairs across
the planet simply could not give enough attention to be able to
manage his own life. The same for the small business man. He must
attend to his business, his community, the people he buys from and
sells to. He doesn’t really have the time to spend a lot of it
worrying about the larger issues.</div>
<div class="western" style="line-height: 100%; margin-bottom: 0in;">
<br />
</div>
<div class="western" style="line-height: 100%; margin-bottom: 0in;">
And
of course there are other dependencies. We are dependent on the
behavior of our neighbors, on the politicians who are expected to
serve us, on the people who provide the public services in our
community. Society is a web of dependencies. So the question is:
Do these dependencies carry any obligation beyond the purely
economic? Do they carry a moral obligation?
</div>
<div class="western" style="line-height: 100%; margin-bottom: 0in;">
<br />
</div>
<div class="western" style="line-height: 100%; margin-bottom: 0in;">
And
what do we mean by moral obligation? From “The Free
Dictionary:”<a href="http://legal-dictionary.thefreedictionary.com/moral+obligation">http://legal-dictionary.thefreedictionary.com/moral+obligation</a>
we have: MORAL OBLIGATION. A duty which one owes, and which he
ought to perform, but which he is not legally bound to fulfill.
</div>
<div class="western" style="line-height: 100%; margin-bottom: 0in;">
<br />
</div>
<div class="western" style="line-height: 100%; margin-bottom: 0in;">
Now
some of these dependencies are equal exchanges. I depend on my
neighbors, and my neighbors depend on me. The sense of ‘duty which
one owes,’ seems clear in these cases. It is not so clear in cases
of hierarchy. Does a boss owe his employee anything besides his
salary? Is not the entire value for both parties of the relationship
summed up in the exchange of labor for money? Is not the employee
compensated in his wages for all the factors of his employment
including, say, the fact that he can be fired at will? If we believe
this, then be believe that not only is the labor market efficient,
but that it is just. But if we believe a particular market is just,
how can we believe that the same market, tilted by external forces,
is also just? Is the market produced by a monopoly just? And
employment, we have a market defined not only by an asymmetry of
needs, as are all markets, but by an asymmetry of information. Can
the employee negotiate a premium on not only on what he doesn’t
know, but what he doesn’t know he doesn’t know? Not only can he
not negotiate such a premium, but it is unreasonable to expect him
to. And even were he to, he would be in competition with those who
would not demand such a premium.
</div>
<div class="western" style="line-height: 100%; margin-bottom: 0in;">
<br />
</div>
<div class="western" style="line-height: 100%; margin-bottom: 0in;">
The
point here there is that there is a gap, which cannot be remedied by
formal debt and application of law.</div>
<div class="western" style="line-height: 100%; margin-bottom: 0in;">
<br />
</div>
<div class="western" style="line-height: 100%; margin-bottom: 0in;">
And
what about the relationship between the wealthy and the rest of us.
Let us first admit the obvious. They pretty much control the
economy. That is, our welfare, the welfare of the society is
dependent on their actions. Even if this were not completely the
case, it is very much so. By their actions, should they choose, they
can do enormous damage to society.
</div>
<div class="western" style="line-height: 100%; margin-bottom: 0in;">
<br />
</div>
<div class="western" style="line-height: 100%; margin-bottom: 0in;">
I am
not claiming conspiracy. I merely claim a similar response to
similar motivations. There was no conspiracy to outsourcing, nor is
there to robotization, but damage was done, though some would say the
benefits to society more than compensated for it.
</div>
<div class="western" style="line-height: 100%; margin-bottom: 0in;">
<br />
</div>
<div class="western" style="line-height: 100%; margin-bottom: 0in;">
But
who got compensated? Did the workers who lost their jobs to
outsourcing gain any share of the increased profits enjoyed by those
companies who sent their jobs overseas? Were they owed any? Did the
companies who fired these workers for greater profit elsewhere have
any obligation to these workers, or society in general? Or just to
enjoy their increased profits, to divide among the wealthy
shareholders?</div>
<div class="western" style="line-height: 100%; margin-bottom: 0in;">
<br />
</div>
<div class="western" style="line-height: 100%; margin-bottom: 0in;">
<br />
</div>
<div class="western" style="line-height: 100%; margin-bottom: 0in;">
<br />
</div>
<div class="western" style="line-height: 100%; margin-bottom: 0in;">
So
do the wealthy owe the rest of us anything? It need not be a matter
of <i>owing. </i>A parent has
obligation to his offspring. But it is not a matter of debt<i>.
</i>And in a very real sense we
count on the wealthy to take care of us, to manage the economy for
the benefit of us all.<i> </i>Why
should society allow them to have and retain wealth, if it were not
to the benefit of the rest of society?<i> </i><i> </i>If
the wealthy have no obligation, then they have no obligation to
act to society’s benefit. They have no obligation
not to inflict damage on the rest of society. So if inflicting
damage on society profits
them, then we should expect them to do so.
</div>
<div class="western" style="line-height: 100%; margin-bottom: 0in;">
<br />
</div>
<br />
<div class="western" style="line-height: 100%; margin-bottom: 0in;">
Unless
they indeed have a moral obligation to the society which supports
them.
</div>
greghttp://www.blogger.com/profile/08201906679062960215noreply@blogger.com1tag:blogger.com,1999:blog-2957498637105757084.post-6253169347211495552017-05-16T00:35:00.001-04:002017-05-16T00:35:53.363-04:00The Growth Trap (Revised) <div class="MsoNormal">
Every economy, every self-organizing system which is not
also self-limiting within the bounds set by its environment, grows until it
exceeds the ability of that environment to support and sustain it. It then collapses. </div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
The collapse of our global economy can be expected to be
catastrophic.</div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
_______________________________</div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
When an economy first develops, acquiring resources is
difficult and expensive. Growth is slow and uncertain, often outstripped by the
demands of increasing population. This
is despite the fact that resources are often accessible and plentiful. The methods of extracting the resources are
primitive and inefficient, and there is little surplus. The demand for and uses for new resources are
limited, and efforts at developing new resources are often desultory. This
state of affairs, essentially one of economic stagnation while surrounded by
plenty, can often last a long time.</div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Note that there is a maximum benefit to any resource, and
the costs of development, extraction, and conversion of that resource to useful
form must be subtracted from that maximum benefit. Ideally, the remainder is
what is available for use by the rest of the economy, though more often an
economy is incapable of extracting the maximum benefit from any resource. There
is almost always some degree of inefficiency of use of any resource by an
economy and in primitive economies, this inefficiency is very high. </div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
However, as infrastructure is invested in and developed, the
relative cost of acquiring and developing resources decreases. More uses are found for extracted resources,
providing motive for ever greater extraction. Since it is easier and cheaper to
develop uses for resources, rather than new sources of resources, demand, in
general, outstrips supply, keeping the profit margins of producers high. For
the producers, this extra profit means more resources are available to invest
in expanding extraction and distribution, thus increasing the supply of these
extracted resources available to be put to other uses in the economy. </div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
With the initiation of growth, the economy is able to
exploit resources at an accelerating rate. The economy grows further. At this stage, the limiting factor no longer is
the costs of extraction, but the limitations in demand, which are the final
uses for the resources, and the necessary distribution systems, which also must
be developed.</div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
So it is necessary to develop an infrastructure, in order to
extract, distribute and employ the resources, There is a cost, in resources
consumed, to developing this infrastructure, There is also a cost to
maintaining this infrastructure, and finally there is a cost to operating this
infrastructure. </div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Since these costs are low, when resources are still
plentiful and cheap to extract, the infrastructure grows robustly, This has the
consequence that the early infrastructure maintenance systems will not be
designed for efficient use of resources. And this has consequence when resources later
become expensive.</div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
For clearly, however, with finite resources, or a finite
average density of resources, or even with a finite rate of renewal of
resources, the availability of resources
limits any economy’s ability to grow. And
this first shows up as resources become more expensive to find, to extract, and
to distribute.</div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Indeed, as the plentiful and inexpensive resources are
consumed, the exploitation of ever more marginal resources, resources which are
more costly to extract and process, which are more distant and difficult to
transport, becomes necessary to expand and even just to sustain the
economy. And the infrastructure must be
expanded to develop these resources, and at an increasing cost. What is more, this increasing cost of
extraction must be passed on, and this increases the maintenance and operating costs
of the entire infrastructure, including that already developed and designed around
a low cost of resources in order to be efficiently maintained and operated. This
older infrastructure becomes disproportionately costly and inefficient to
operate when resources are more costly.</div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
So less and fewer resources are available for expansion of
that infrastructure. </div>
<div class="MsoNormal">
Eventually, as the availability of resources decreases, and
their cost of extraction increases, the cost in resources necessary to develop
new infrastructure, and more importantly, the cost in resources necessary to
maintain and operate the infrastructure
already built, exceeds the ability of the economy to extract benefits from
those resources. </div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Increasingly, maintenance will be sacrificed to cover the
increasing costs of operation. The system will no longer be covering its fixed
costs, but only its variable costs. The result will eventually be a stage where
the infrastructure can no longer be maintained, when the maintenance budget
passes below a critical threshold, but will be subject to increasing
catastrophic failure. This threshold is roughly when the budget is no longer
able to cover both preventative maintenance and essential repairs. With
inadequate preventative maintenance, essential repairs will increase, eating
into the budget for preventative maintenance. As the budget for preventative
maintenance decreases, the need for essential repairs will increase, in a
vicious spiral. This process is sped by increasing costs of operation as a
result of the increasing cost of acquiring resources, which the declining
quality of the infrastructure also aggravates. </div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
The real increasing costs of maintaining the real economy,
(and in particular its infrastructure,) and the increasing real costs of its
extraction of real resources from the natural environment, are hidden by the
mechanisms of externalization of costs. </div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
In an economy there are many mechanisms for externalizing
costs, but they fall into the two broad classes of externalizing real costs,
and of externalizing financial costs.
Externalizing financial costs does not alter the real costs of
extraction and distribution. By
financial manipulation, these real costs are not reduced, but merely
redistributed throughout the rest of the economy, the point being that the
extractive industry will appear to be making more of a monetary profit than it
really is. The industry may actually be
losing money. But the appearance of profit
leads to the real economy appearing to be gaining greater benefit from the
extractive process than it really is.
Real costs <i>appear</i> lower,
because financial costs <i>appear</i> lower.
But the financial costs to some of the other
sectors of the economy <i>become </i>higher,
though, because they must absorb some of the real costs of extraction. Somebody must pay, and if not the extractive
industries themselves, then it must be somebody else. And all together, the real cost is greater,
because resources are consumed in the economically empty endeavor of
externalizing costs.</div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
On the other hand, the externalization of real costs does permit
the current extraction of resources at a present day lower real cost. </div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
So two ways of externalizing real costs are pollution and the
over exploitation of a renewable resources.
Deferred maintenance is another. So
where externalizing financial costs distributes real costs throughout a present
economy, we see that the direct externalization of real costs distributes those
costs into the future economy. Externalized
costs distributed over the future also tend to be greater than costs which are internalized
in the present. For one example: The <st1:place w:st="on">Newfoundland</st1:place> cod
fishery: It collapsed in 1992 due to
overfishing, and has yet (2017) to recover. </div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
These manipulations
of the real economy, as well as the financial manipulations which enable them,
enrich the financial and consuming sectors, and impoverish the actual producers
of real goods and services. At this late
stage, many productive sectors are deprived of the real resources necessary for
them to grow, and ultimately to maintain themselves.</div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
</div>
<div class="MsoNormal">
For in the case of the modern economy, there are two
relevant systems: The real economy
itself, and the financial economy which feeds off the real economy. The financial economy produces nothing of
substance itself. When useful it serves as a multiplier of production, by
increasing the efficiency of allocation of resources. If feeds itself, first,
however, before the real economy, and when overgrown it diverts more resources
to itself than it saves the real economy by that allocation of resources. The result is a decline in the efficiency of
the real economy, and its ability to grow. </div>
<div class="MsoNormal">
</div>
<div class="MsoNormal">
In any case, this happens at a late stage in the development
of the real economy, when the resources available to the real economy to mount
opposition to the growth of the financial economy are diverted away. Part of
this is the result of increasing real costs in the rest of the economy outlined
above. Part is by the increasing diversion
of resources by and to the financial sector itself. (Inter-sectoral competition for resources is
seldom considered by business leaders.) A
point is reached when effective regulation of the financial sector fails. (One part of this process is that one of the
consequences of the increasing concentration of wealth is that the value of
non-financial rewards offered by the society declines, and become devalued,
reducing the cost of corrupting other institutions.) </div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Once the financial economy evades the controls set on it by
the real economy, it grows without effective bounds. The financial sector then out-competes
the real economy for money. The
financial sector is designed around the acquiring of money, and, unregulated,
is simply more efficient at this than any sector of the real economy. </div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Feeding off the real economy, finance is also a
non-self-limiting, self-organizing system.. It too is subject to overgrowth and
collapse. This happens when it exceeds
the ability of the real economy to support it. When this occurs, if and only if
it occurs before a critical point in the growth of the real economy, the real
economy may yet be saved. This is not
because the real economy is self-limiting.
It is only because it has been increasingly organized to service the
financial economy, and with the collapse of the financial economy, the real
economy may be reorganized into a self-limiting form. This is not guaranteed. This may not even be likely. In 2008, the opportunity for such
reorganization arose, and was missed. And whether or not the real economy can still
be saved still depends on whether or not it is already too big to be
reorganized into a sustainable form. (It
should be mentioned that capitalism, per se, is organized around efficiency,
not sustainability.)</div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
With the financial economy in ascendant, money is pumped out
of the real economy almost as fast as government spending can pump it in. This severely reduces the profit margins of
productive industries. Producers in the
real economy would be hurt two ways.
Because of lags in production, prices of final goods are reduced vis a
vis the prices of the factors which went into them. And because of the money diverted into
finance, prices for those final goods are also diminished. </div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Because of the diversion of money to the financial economy,
the quantity of various forms of money in the financial economy increases. This is accompanied by ever greater
concentration of wealth. While all
assets become overvalued, consuming assets, in particular the assets of producers
of toys for the wealthy, gain the highest profit margins, and so gain the
highest valuation. At the same time, the assets of more basic industries,
caught between rising costs and more limited demand, have lower profits, and
thus a lower increase in value. </div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
This growth is in the demand, or consuming side of the
economy, which conceals a relative decline in the extracting and manufacturing
sectors. GDP, for instance, does not
distinguish between growth in basic industries, whose value added is underpriced,
and growth in consuming sectors such as retail (High and low end retail. Retail oriented toward the middle and working classes,
as these are the classes from which the wealthy can most efficiently extract
money, does not do as well.) and, increasingly, finance. The economy becomes increasingly skewed, away
from production and towards consumption. </div>
<div class="MsoNormal">
. </div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
This financial extraction becomes ever more difficult and
costly, as the real economy becomes progressively impoverished and less
productive. The concentration and
availability of extractable community assets also declines. These assets, historically, because of their
low potential for profits, were unattractive to private enterprise, and government
was virtually compelled to assume these responsibilities. Public services become attractive to private
monies only due to the combination of being cheaply acquirable capital, the
dearth of alternative investment opportunities, and, because of the increasing
inability of the undercapitalized public sector to defend itself, opportunities
for graft.</div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
This decline in efficiency of financial extraction, means
more labor is required for the financial sector to extract wealth from the real
economy. Thus, even though most labor is no longer involved in real extraction
and production, there results the paradox of an increasing burden on labor in
non-productive jobs. This is obscured by the fact that these financial costs
are increasingly externalized onto the real economy, ie absorbed by
non-financial industries and labor . However, because of the decreasing
efficiency, the profit to be made off these jobs is very low, and decreasing,
and the pay must be commensurate. </div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Meanwhile, since the cost of all maintenance increases, the
cost of maintaining the burden of the financial and consuming sectors is also
increasing; the costs required for
extraction increase, the actual financial profits decline to zero and even go
negative. </div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
The degree of financial exploitation is not reduced, but more
resources are devoted to the process.
Even as this happens, fewer resources are available to the real economy.
This is both because the financial sector externalizes its costs onto it onto
the real economy, (and thus appearing artificially profitable,) and because
greater real resources must be expended in acquiring resources from an
increasingly impoverished natural environment.
</div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Combined, these processes render the usual indicators of
economic health and prosperity at least useless and even more likely
misleading. Much growth occurs in the wrong sectors, and is indicative of
impending failure, rather than success. Further, with increasing deregulation,
more fraud may be expected, both in production, and in reporting on that
production, further corrupting indicators.</div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
______________________________</div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Mankind has yet to develop a modern, self-limiting economy.
Hunter-gatherer societies existed in ecological equilibrium with their
environment, fitting into the limits set by the rate of replenishment of
renewable resources. For pre-industrial
economies, the growth trap must be considered as a possible factor in their
ultimate decline. Since economies ultimately serve a population, clearly, with
unrestricted population growth, no self-limiting economy is possible. And any non-self-limiting economy will be
subject to the growth trap. </div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
More to the present, however, there is no evidence that
capitalism is self-limiting. Indeed, the
virtue of Capitalism is efficiency, not sustainability. Because of its inherent drive for efficiency,
it is able to out-compete any sustainable system, and destroy it. It even out-competes those sustainable
systems it depends on, and destroys those. </div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Only a self-limiting economy can survive the growth
trap. Only an economy which can limit
its consumption of renewable resources to some rate less than the rate those
resources are renewed, and its consumption of non-renewable resources to some
rate less than those resources can be recycled, can be indefinitely
sustained. All other economies will
fail. And a failing economy will be incapable of providing sufficient resources
for the survival of most of its members.
Indeed, because of the enormous efficiencies brought about by a modern
economy, if that economy fails, such a failure will be catastrophic, and only
small percentage of the people who depend on that economy can be expected to
survive.</div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
There still seems a choice, however, although, judging from
their antics, our political class seems either incapable of or uninterested in
confronting the issue.</div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
<br /></div>
<br />
<div class="MsoNormal">
Revised and expanded Sep 7,2016, Nov7, 2016, Feb 17, 2017,
May15, 2017</div>
greghttp://www.blogger.com/profile/08201906679062960215noreply@blogger.com0tag:blogger.com,1999:blog-2957498637105757084.post-76979781375769564732017-05-04T02:35:00.000-04:002017-05-08T20:08:10.471-04:00Hidden Benefits of Taxes<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
<b><span style="font-family: "arial" , "sans-serif"; font-size: 16.0pt;">Hidden Benefits of <st1:address w:st="on"><st1:street w:st="on">Taxes </st1:street></st1:address></span></b><b><span style="font-family: "arial" , "sans-serif"; font-size: 16.0pt;"><st1:address w:st="on"><st1:street w:st="on"><span style="font-size: x-small;">A revision of the Social Benefits of taxation </span><span style="font-size: 16pt;"> </span></st1:street></st1:address></span></b><b><span style="font-family: "arial" , "sans-serif";"> </span></b></div>
<div class="MsoNormal" style="margin-left: .5in;">
A large tax wedge can lead to a
dramatic increase in economic efficiency. The market share of 'deadweight loss'
produced by a tax wedge consists of inefficient producers and indifferent
consumers. The high costs in resources
involved in production of the relatively small quantity of 'deadweight loss
benefits' can be much more efficiently applied elsewhere in an economy. Because of this increase in efficiency, we
find a substantial government sector and its services may be maintained with
very little net cost to a society.<span style="font-family: "arial" , "sans-serif";"><o:p></o:p></span></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Historically, taxes have been considered to be a burden on
the productive capacity of an economy.
Many of us have at least little bit of a feeling that they’d be better
off without them. Even critical services
such as police and fire protection are suspect expenditures to some. Spending
tax money on infrastructure, like roads, public water supplies, in some
countries health care and retirement, some claim to be an imposition on their
liberty. Some say all taxation is theft.
We will not arguer these philosophical points, we will merely argue that an
economy, a society, is materially better off with taxes, almost irrespective of
what those taxes are spent on. This is
because some of the most important benefits of taxes are not in what they
provide, but in how they can shape an economy. Here they can provide a massive
increase in economic efficiency, a much higher amount of goods and services for
a given amount of resources consumed.</div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Let us look the standard Econ 101 supply and demand diagram
of a free market, and see what happens when we impose a tax. We will look at the market for that commodity
familiar to economics students everywhere: Widgets. Sure, it could be a market in anything, but most markets have
unique characteristics, and we want to talk generalities. So we’ll use widgets.</div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
1:XXX<br />
<div class="separator" style="clear: both; text-align: center;">
<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgkinOcy1sTUjhPCJXa-ajAzCSg5B39EzTQNoChxDbYYSR_ndaJ-Mb4APIgfWUMQXueYYi9jf5RkrsL2VTz9k54pROfm6FBMXRpY-gjkGnYjfSxRdcvFKcMfbmgAhFlRWPZWbAT4zTlbS9X/s1600/1++Free+Market.jpg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" height="598" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgkinOcy1sTUjhPCJXa-ajAzCSg5B39EzTQNoChxDbYYSR_ndaJ-Mb4APIgfWUMQXueYYi9jf5RkrsL2VTz9k54pROfm6FBMXRpY-gjkGnYjfSxRdcvFKcMfbmgAhFlRWPZWbAT4zTlbS9X/s640/1++Free+Market.jpg" width="640" /></a></div>
</div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
In a supply and demand diagram for the market of widgets,
the quantity of widgets bought and sold
is plotted against the price. The more
money is offered for widgets, the more producers are willing and able to make,
so the supply curve slopes upward. The
demand curve slopes downward because the higher the price for widgets, the
fewer widgets consumers are willing to buy.
Where they come together (at the
equilibrium point <b><span style="font-family: "arial" , "sans-serif";">e</span></b>) is that price where consumers are willing to
buy as many widgets as producers are willing to make and sell.</div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
The green and blue triangles are the benefits (welfare)
society gets from widget production. The benefits are divided between the
producers and the consumers. The blue is
what the producer gains from producing widgets.
This includes his profits. The green is the net benefits consumers get
from using their widgets. Not all consumers derive the same benefits. Some need their widgets more. Some may just have more fun with them.</div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
The price is the market price, and is the same for all
producers and consumers. The quantity of
widgets produced, and the price they are sold at on the market, are determined
from where the supply and demand curves come together. (At <b><span style="font-family: "arial" , "sans-serif";">e.</span></b>) Looking at the diagram,
we see the widget producers on the left are able produce at a lower cost than
producers on the right, so they are able to make higher profits. They get more benefits than the less
efficient, more marginal producers.
Similarly, the consumers on the left get more benefit from the use of
the widgets they buy. This is shown by their willingness to pay a higher price
along the demand curve. The difference
between what they are willing to pay for widgets and what they actually <i>have</i> to pay is the net benefit they
derive from what they are buying. </div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
To the right of the equilibrium point, the cost to producers
for making widgets is greater than consumers are willing to pay for
widgets. The cost of production per
widget goes up, but with more widgets produced than consumers are willing to
pay so high a price for, the price goes down.
So producers don’t make more than quantity <b><span style="font-family: "arial" , "sans-serif";">Q</span></b> widgets, because consumers won’t buy more
than <b><span style="font-family: "arial" , "sans-serif";">Q</span></b>
at that price. </div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
So what happens when
we put a tax on widgets? Here we put a
production tax <b><span style="font-family: "arial" , "sans-serif";">T</span></b> on every widget. This results in a price difference between <b><span style="font-family: "arial" , "sans-serif";">P’,
</span></b>the price consumers pay<b><span style="font-family: "arial" , "sans-serif";">, </span></b>and<b><span style="font-family: "arial" , "sans-serif";"> P*, </span></b>the price producers collect<b><span style="font-family: "arial" , "sans-serif";">,</span></b>
on every widget produced. This is called a tax wedge. It effectively increases the cost of
production for widgets. So it shifts the
supply curve up by that amount, as shown in the following diagram.</div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
2:XXX<br />
<div class="separator" style="clear: both; text-align: center;">
<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgS1BwsOOnwqvUbZj-LOh3Og6noEYLnLntpe9Kfx30znqqOuv_136q9-4uNuQU1UbXuPUaqsSSM6PBgfX9lsLggJu8e0Goyj3Ex9MxJJJZGRo5e4CYMVCwsBQUCeUIQFz8J-SnghbqbxpUG/s1600/2+Market+with+Taxes.jpg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" height="598" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgS1BwsOOnwqvUbZj-LOh3Og6noEYLnLntpe9Kfx30znqqOuv_136q9-4uNuQU1UbXuPUaqsSSM6PBgfX9lsLggJu8e0Goyj3Ex9MxJJJZGRo5e4CYMVCwsBQUCeUIQFz8J-SnghbqbxpUG/s640/2+Market+with+Taxes.jpg" width="640" /></a></div>
</div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Since the price <b><span style="font-family: "arial" , "sans-serif";">P’</span></b>
paid by consumers is higher, they don’t want to buy as many widgets as before.
Instead of wanting to buy <b><span style="font-family: "arial" , "sans-serif";">Q</span></b> widgets at price <b><span style="font-family: "arial" , "sans-serif";">P</span></b>,
at the higher price <b><span style="font-family: "arial" , "sans-serif";">P’</span></b> they only want to by <b><span style="font-family: "arial" , "sans-serif";">Q’</span></b>
widgets. Meanwhile, at the quantity <b><span style="font-family: "arial" , "sans-serif";">Q’</span></b>
of widgets that consumers want to buy, producers can only receive <b><span style="font-family: "arial" , "sans-serif";">P*.</span></b> The difference between the prices <b><span style="font-family: "arial" , "sans-serif";">P’
– P*,</span></b> times the quantity <b><span style="font-family: "arial" , "sans-serif";">Q’</span></b> produced and sold, is
the revenue received by the government.
So we have three regions of benefits, Producer Welfare and Consumer
Welfare are both reduced. Much of this
welfare lost by consumers and producers goes instead as Government
Welfare. For their loss in taxes,
consumers and producers gain the benefit of government services. The remainder
is the region of deferred welfare, benefits which society does not receive,
because the tax makes the production of more than Q’ widgets unprofitable to
producers, and too expensive for consumers. So the combined benefits to society
with the tax are less than the benefits which accrue to society without the
tax.</div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
However, this region of lost benefits, the region of so
called ‘deadweight loss due to taxes,’ consists of benefits which are both
costly to produce, and therefore of low benefit to producers, and of low
benefit to consumers, because the remaining consumers in the market are
unwilling to pay much more than what the market price would be without
taxation. In fact, with taxation, they
are unwilling to pay the price for widgets at all. They just don’t want widgets that badly. The
resources spent in producing these small benefits, now, could be more
efficiently spent elsewhere in the economy, as we show in the next diagram.</div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
<div class="separator" style="clear: both; text-align: center;">
<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhrT-i_mP2ifCVNApJNHwQb_P6FHBNyYT3i9Ot4OxdlJbuI6kRTXgltFJpnzH67p27qXzFNfrPbS8nQpjivYe3kFxDLEMP0cS_Fz66bkbOhTLQkrdw6h2dcAnxE2euCQzpkjoHKkK9fjFNN/s1600/3+How+Taxation.jpg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" height="400" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhrT-i_mP2ifCVNApJNHwQb_P6FHBNyYT3i9Ot4OxdlJbuI6kRTXgltFJpnzH67p27qXzFNfrPbS8nQpjivYe3kFxDLEMP0cS_Fz66bkbOhTLQkrdw6h2dcAnxE2euCQzpkjoHKkK9fjFNN/s640/3+How+Taxation.jpg" width="640" /></a></div>
<br /></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
3:XXX</div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Here, in <b><span style="font-family: "arial" , "sans-serif";">Market W, S’ </span></b>is the new Supply curve brought
about with the increase in costs imposed on widget producers from
taxation. The marginal benefits (green
striped triangles) otherwise attained by marginal producers at higher cost are
forgone, the resources which would have been spent to obtain those marginal
benefits are instead available, and here allocated, to be expended more
efficiently in <b><span style="font-family: "arial" , "sans-serif";">Market T</span></b> of the economy, the market for
thingbobs,. <b><span style="font-family: "arial" , "sans-serif";">Market T</span></b> can
be similarly taxed, the resources applied still elsewhere in the economy.
Eventually, of course, the entire economy is made more efficient, as a portion
of the otherwise inefficiently used resources in other markets are distributed
to other markets, are some even eventually returned to more efficient use in
the markets for widgets and thingbobs. </div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Now the freed resources are not actually re-allocated by
government. Private enterprises, rather
than trying to inefficiently compete in an unprofitable market, simply choose
to place their resources in other markets where they can be used more
efficiently. One can argue, of course,
that they should do this anyway. But it
is simply the fact that every market has marginal and inefficient producers,
trying to make a dollar. The tax
provides them with additional incentive to enter markets where their use of resources
will be more socially efficient, where for lesser cost they provide greater
welfare.</div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
To be sure, the difference is harvested by the government.
And if we examine the diagram with two markets, we see that the net benefits to
the private sector <i>are</i> smaller, with
the tax, by about the welfare society would gain from the inefficient
producers. The diagrams are generic, and
results will vary. However, in the
example sketched, with a tax wedge in place transforming the inefficient
producers in one market into efficient producers in another, for the same cost,
society gains government welfare in amount about 4 times the total welfare
provided by the inefficient producers. (The direct gains in government welfare
from taxing widgets replaces some of the welfare society would gain if the
market in widgets were untaxed. So, for the cost of expensively produced
widgets, we gain efficiently produced thingbobs, and a total of government
services of value more or less equal to the value of the combined social value
of the production of both widgets <i>and</i>
thingbobs. .</div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Under judicious taxation, as a result of this increase in
efficiency in the use of resources, most of the services of government can be
provided for for free. That is,
resources which would be applied in some inefficient productive process, and so
largely wasted, may be applied more efficiently in providing economically
useful government services. And many of the services provided by government, by
eliminating many of the costs of transaction and overhead that producers would
otherwise bear, also act to increase the efficiency of the private productive
economy. Inadequate taxation, and the
necessary reduction in economically useful services purchased with these taxes,
far from increasing the competitiveness of an economy, decreases it, and
nations with an inadequate public sector are at a competitive disadvantage with
respect to foreign producers in countries with more robust public sectors.
Further, even with the light tax burden, the citizens of countries with small
public sectors are less provided for, and are a greater burden to the industry
of that country, than countries with a larger government service sector. </div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
In the example illustrated by the diagram, without taxation
the total social welfare is about twice the cost of resources expended. ( The size of the green plus the blue triangles
compared to the pink triangle in the first diagram.) With the tax wedge as
illustrated, the total social welfare is almost 4 times the real cost to
producers. (The size of the solid green
and blue regions in both markets of the previous diagram compared to the solid
pink regions.)</div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Although we have drawn the diagram for two particular and
identically composed markets, it is apparent that for a wide variety of supply
and demand diagrams, and thus, for a wide variety of economic sectors, the
application of a tax wedge will result in a large increase in economic
efficiency. </div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
By implication, the opportunity costs of the small amount of
marginal benefits forgone are huge. The benefits forgone would be obtained by
essentially wasting resources in producing them, and are a small fraction of
the benefits produced by allocating these resources more efficiently. Indeed, we may expect this improvement to be
even better than it initially appears, since we would expect the most marginal
producers to be those most eager to externalize their costs in order to remain
competitive. Pressure to externalize
costs is thus also reduced on the more efficient producers. The economic
results from failing to apply a tax wedge in a market are, apparently without
exception, far inferior</div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
The very pejorative “deadweight loss,” has been used by
those ideologically opposed to government intervention in an economy as a
justification for their position. However, they, and the economics profession
as a whole, have totally over-looked the high opportunity costs involved in the
creation of these marginal benefits.
Taking these costs into consideration inverts the conclusion: The gain in freed resources, in almost any
reasonable scenario, far outweighs any gain involved in wastefully spending
these resources for these relatively small benefits. Indeed, in the scale of economic activity,
these resources are much more wisely spent elsewhere. And the tax wedge causes this to happen. Far from being a burden, taxation in a
market, and at what is traditionally considered a rather high level of
taxation, can yield much closer to optimal economic results. .</div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
I leave it to those ideologically opposed to government
intervention to find exceptions to the tax wedge increasing efficiency. I do
observe that the apparent requirement for monotonicity in the supply and demand
curves would seem to make finding these exceptions difficult. </div>
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<br /></div>
<div class="MsoNormal">
One interesting argument, though, which remains, is the
argument from liberty. This argument
would seem to suggest that the wanton destruction of scarce resources is,
somehow, ‘liberating.’ And indeed, acquiring the ability to squander society’s
resources seems to be one of the primary motives for becoming wealthy, and
indeed the ability, and under capitalism the right, to squander society’s
resources is the very defining characteristic of wealth. And this would seem,
for example, to be the argument against higher gasoline taxes in the <st1:country-region w:st="on">United States</st1:country-region>.
The case shown here is that a higher gasoline tax, even with money spent (more
efficiently) on public transit, would free up resources for everyone, as the
European experience seems to show. To be
sure, there would be less joyriding, and tickets to NASCAR events might become
more expensive.</div>
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<br /></div>
<div class="MsoNormal">
There does remain the issue of determining the balance
between efficiency and quantity of production in any particular market required
for the proper functioning of an economy.
Considerations of scale indicate that, contrary to what is shown in the
diagrams, the first unit of anything is seldom the most efficiently
produced. Rather, there is an optimum
scale of production, that which minimizes the average cost, (This ignores
issues of demand, and thus actual profit.) and we must consider this to be true
for an entire economy as well as for a particular production process. While with this consideration the improvement
in economic efficiency would not be as great, it must still be expected to be
impressive.</div>
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<br /></div>
<div class="MsoNormal">
Also, it should be easier to tax economic wants as opposed
to economic needs. (Although see problem
three, below.) A more efficient economy, however, needs less to sustain its
function, and so has relatively more resources available for the servicing of
wants. </div>
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<br /></div>
<div class="MsoNormal">
“Deadweight loss” is
also found in other market situations.
Regulated markets, markets with price controls, and markets restricted
by private actions such as monopoly formation and oligopoly usually also
involve deadweight loss. Increases in efficiency should also be expected in
these situations, so It would seem that these other situations also, at the
least, need to be re-examined. </div>
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Now direct consumer benefits per se are also much less under
taxation, the same as under monopoly, and the producer surplus is also much
less. However, the government spreads much of its income widely. It is, in its
way, both a consumer and a producer. It re-distributes consumption, and
capitalizes production, both directly, through capital investments, and
indirectly, through subsidy of production, and creation and maintenance of
infrastructure. And all of its expenditure, purported to be for the public
benefit, does, one way or another, enrich the diverse sectors of the economy.</div>
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<div class="MsoNormal">
One problem with the tax wedge, however, because it favors
the more efficient producers, it also favors the economic drift toward
concentration of ownership, and the creation of oligopolies and eventually
monopolies. We will address this issue
here shortly.</div>
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<div class="MsoNormal">
Narrowly held monopolies cannot be expected to spread their
profits. Neither can monopolists be
expected to spend their profits to provide services which increase the
efficiency of the larger economy.
Monopolies once formed, and where not widely owned, further to aggravate
the natural tendency of economies to concentrate wealth and power, a
concentration which leads to economic instability and collapse. This is
especially so because the power concentrated in monopolies tends to translate
into political power. And the monopolist
must be expected to use this power to further his power, and mitigate the
impact of a tax wedge on his revenue. </div>
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<br /></div>
<div class="MsoNormal">
A second problem is that producers which escape taxation
will eventually displace those producers which are subject to taxation. The
result will be a reduction in both taxes collected and in economic
efficiency. This problem must be
considered especially acute in open economies, where tax paying domestic
producers can be expected to be displaced by non-taxpaying (and these producers
which can often be less efficient) foreign ones The interesting implication
here is that, while a nation’s economy may be producing less and consuming
more, as an increased share of what is consumed is imported, (much of what is
considered production actually either enables consumption, or is a form of
consumption,) that economy need not be any better off for this increase in
consumption. Because of the decrease in
economic efficiency, fewer consumables will be efficiently used, and more of
this consumption will be squandered. A
country running a deficit is essentially externalizing costs, and these costs
may in reality be greater to the country than if the country were to
internalize them.</div>
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<br /></div>
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A third problem is, of course, the politics of
taxation. Nobody likes to be taxed, and
the powerful, more than others, are capable of avoiding it. (This also bears on
the second problem.) This first suggests that the markets which serve the
wealthy will be the least efficient, even though these are the markets where an
economy can most easily bear the loss of marginal producers. (Marginal producers may be needed in the
production of an economy’s necessities.)
And this further suggests that a disproportionate share of an economy
will be dedicated to servicing the wealthy, even at the expenses of the
necessities of that economy, such as maintenance of infrastructure. For instance, a recent study has shown that
in the <st1:country-region w:st="on">United States</st1:country-region>
today, essentially no policies are enacted by the government which are not also
approved by the wealthy elite. An
implication of this is that the tax burden upon this elite can only be expected
to diminish, and thus that the burden of taxation on the rest of economy and
the population can only increase. </div>
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One final note. As an
economy increases in efficiency, it inherently becomes less stable, and more
vulnerable to collapse. An efficient economy becomes dependent on its
efficiency in order to be productive enough to sustain itself. The greater the efficiency, the greater its
dependence. A reduction in efficiency
will result in a reduction of production, perhaps sufficient enough that that
economy can no longer sustain itself. </div>
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A particular consideration regarding improvements in
efficiency brought about by regulation and a tax wedge, where a wedge and/or
regulation is already established, is that removing or even merely reducing
these factors will result in a reduction of that efficiency, and a resulting reduction
in the productive capacity of that economy.
That economy may no longer be able to sustain itself. With a critical
reduction in production, cascades may result, and the possibility of sectoral
and even general collapse. Great care,
therefore, should be exercised in the reduction of the size of tax wedges, or
the elimination or alteration of any significant regulation. </div>
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Given the tightly coupled world economy, the efficiency of
production of any major economy is a
concern for all other nations.</div>
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greghttp://www.blogger.com/profile/08201906679062960215noreply@blogger.com0tag:blogger.com,1999:blog-2957498637105757084.post-26619300049117065692017-04-28T02:58:00.000-04:002017-04-28T03:06:32.199-04:00A brief note on Economists and the Assumption of Perfect Rationality.The assumption of homo economicus, or even the lesser assumption of perfect rationality, cannot possibly be true. If even the assumption of perfect rationality were true, all economists would have the same opinions.<br />
<br />
The only possible exception would be that economists of perfect rationality could have different opinions if their opinions were based on different information. We would have to say then, the assumption of perfect rationality, but bounded information.<br />
<br />
However, let us suppose a situation with bounded information and perfect rationality, and two economists with differing opinions. Then one or the other or both economists do not have sufficient information to properly analyze the situation.<br />
<br />
In general we have: Given a sufficiently competent computer, its output is purely a function of the input. Therefore, given two sufficiently competent computers, if they differ in the output, they differ in the input.<br />
<br />
However, in the fact, if the union of opinions in economics is less than the space of all possible (reasonable) opinions, it is uncertain that even one economist is capable of both perfect rationality, and unbounded information.<br />
<br />
It should be mentioned that the techniques of rationality are many and varied, and require considerable information input to form and develop.Thus bounded information would seem to at least render unlikely the development of perfect rationality.<br />
<br />
Finally, \the mention of information brings to the fore the field of information theory, which seems not to have attracted much attention among economists. <br />
<br />greghttp://www.blogger.com/profile/08201906679062960215noreply@blogger.com0tag:blogger.com,1999:blog-2957498637105757084.post-29958173119131758032017-02-28T20:30:00.000-05:002017-02-28T20:30:43.392-05:00Corruption and Growth: A Link and a Comment<div class="MsoNormal">
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Here’s a link to one of today’s posts at Naked Capitalism.</div>
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<a href="http://www.nakedcapitalism.com/2017/02/bill-black-2016-nobel-prizes-economics-go-defenders-criminogenic-policies.html">http://www.nakedcapitalism.com/2017/02/bill-black-2016-nobel-prizes-economics-go-defenders-criminogenic-policies.html</a></div>
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The article is worth the read. </div>
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<div class="MsoNormal">
We first pause here to note Nobel prize winner Milton ‘Friedman’s
assertion that: "<i>there is one and
only one social responsibility of business–to use it(s) resources and engage in
activities designed to increase its profits</i>,..” could be the motto of a sociopath. He does continue with the qualification: “..<i>so long as it stays within the rules of the
game, which is to say, engages in open and free competition without deception
or fraud</i>.” Since, progressively, even
since he wrote this in 1970, corporations have been writing the rules which
define what is open and free competition, and what constitutes deception and
fraud, that qualification has become quite empty. </div>
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The issue here, though, is the question: “How much of the growth in the nation’s GDP is
fraudulent? How close to reality are the
figures which track our nation’s economy?” </div>
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This gives one cause to wonder: Is the economy even growing at all? Or is it actually contracting? The reality of the data on <st1:country-region w:st="on">China</st1:country-region>’s economy
has been called into question. Why not
the data on ours?</div>
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The question is
especially relevant since no bankers were ever prosecuted after the 2008
financial crisis. The fraud involved, and there was a lot, was apparently all
legal. With overturning the Dodd-Frank law under Trump, clearly the incentive for
fraud will increase. And if we consider
the consequences of the Volkswagon emissions scandal and the Takata air bag
scandal, producing more of something imaginary would seem to be preferred to
the risks of producing something real.</div>
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<br /></div>
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Now, as the economy pushes the constraints of reality,
accurate response to stressors is increasingly required. And this requires accurate information as to
the size and nature of those stressors. </div>
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<br />
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Objective reality is independent of one’s opinion of it. The “Post-Truth Trumpian Worldview” is
unlikely to provide the proper responses to any future crises.</div>
greghttp://www.blogger.com/profile/08201906679062960215noreply@blogger.com0tag:blogger.com,1999:blog-2957498637105757084.post-79398054172708073472017-01-28T21:39:00.000-05:002020-01-24T20:36:05.976-05:00On the Social Benefits of Taxation II<div class="MsoNormal">
<b><span style="font-family: "arial" , "sans-serif"; font-size: 16.0pt;"><span style="font-size: x-small;">On The Social Benefits
of </span><st1:address w:st="on"><st1:street w:st="on"><span style="font-size: x-small;">Taxation II </span><span style="font-size: 16pt;"> </span></st1:street></st1:address></span></b></div>
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Taxation has historically been considered to be a burden on
the productive capacity of an economy.
However, it is easy to show that taxation can increase the efficiency of
an economy by rendering inefficient producers unprofitable, and so eliminating them. What is eliminated from a particular market
by proper taxation are the most marginal producers, and the least avid
consumers. Under judicious taxation, as a result of this
increase in efficiency in the use of resources, the services of government can
largely be provided for for free. That
is, resources which would be applied in some inefficient productive process,
and so largely wasted, may be applied more efficiently in providing economically
useful government services. And many of the services provided by government, by
eliminating many of the costs of transaction and overhead that producers would
otherwise bear, also act to increase the efficiency of the private productive
economy.* Inadequate taxation, and the
necessary reduction in economically useful services purchased with these taxes,
far from increasing the competitiveness of an economy, decreases it, and
nations with an inadequate public sector are at a competitive disadvantage with
respect to foreign producers in countries with more robust public sectors.
Further, even with the light tax burden, the citizens of countries with small
public sectors are less provided for, and are a greater burden to the industry
of that country, than countries with a larger government service sector. <br />
<br />
We show this in <b><span style="font-family: "arial" , "sans-serif";">Diagram 1. </span></b>Where the marginal benefits
attained at higher cost are forgone, the resources which would have been spent
to obtain those marginal benefits are instead available to be expended more
efficiently in other sectors of the economy. <br />
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<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgSGqGvsGoxlD7fD6ohgAUBjq00OW5pZCJY89Zh5qNEdbZQDNEmh0b_S5woPO5Mt9uUn3cKtOFZ1MMW0UvcnW0TM4hMZnrF2n_P269Te-tTSbCDRD_B8oQSQUEnBCDWHvQoXc4uA7YPHIzY/s1600/How+Taxation+can+Increase+Economic+Efficiency.jpg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" height="428" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgSGqGvsGoxlD7fD6ohgAUBjq00OW5pZCJY89Zh5qNEdbZQDNEmh0b_S5woPO5Mt9uUn3cKtOFZ1MMW0UvcnW0TM4hMZnrF2n_P269Te-tTSbCDRD_B8oQSQUEnBCDWHvQoXc4uA7YPHIzY/s640/How+Taxation+can+Increase+Economic+Efficiency.jpg" width="640" /></a></div>
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In the diagram, the tax wedge is the difference between the
price paid, <b><span style="font-family: "arial" , "sans-serif";">P’</span></b>, and the income received by the producer, <b><span style="font-family: "arial" , "sans-serif";">P*</span></b>. The total tax revenue, the pale green block in
each market defined by: <b><span style="font-family: "arial" , "sans-serif";">Q’ x (P’ – P*) </span></b>is the
welfare received by government. The
lower brighter green triangle is the producer surplus; the upper brighter green
triangle the consumer surplus. In each particular market, with the application
of a tax wedge the ratio of social welfare obtained to costs, that is resources
expended, increases from about two to one, roughly the ratio of the all the
greenish areas to all the pinkish areas in each market, to almost four to one,
the ratio of the solid green areas to the solid pink area. Although we have
drawn the diagram for two particular and identically composed markets, it is
apparent that for a wide variety of supply and demand diagrams, and thus for a
wide variety of economic sectors, the application of a tax wedge will result in
a large increase in economic efficiency. By implication, the opportunity costs
of the small amount of marginal benefits forgone are huge. Indeed, we may expect this improvement to be
even better than it initially appears, since we would expect the most marginal
producers to be those most eager to externalize much of their costs in order to remain
competitive. Pressure to externalize
costs is thus also reduced on the more efficient producers. The economic results
from failing to apply a tax wedge in a market are, apparently without
exception, far inferior</div>
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Historically, of course, this relatively small region of
forgone welfare has been labeled “deadweight loss,” the "Harperger Triangle," whose existence has been
considered a counter-argument to the efficiency and usefulness of taxation.
Indeed, the very pejorative “deadweight loss,” has been used by those ideologically
opposed to any government intervention in an economy as a justification for their
position. However, their argument, and the economics profession as a whole, has
totally over-looked the high opportunity costs involved in the creation of
these marginal benefits. Taking these
costs into consideration inverts the conclusion: The gain in freed resources, in almost any
reasonable scenario, totally outweighs any gain involved in wastefully spending
these resources for these relatively small benefits. Indeed, in the scale of economic activity, these resources are much more
wisely spent elsewhere. And the tax
wedge causes this to happen. Far from
being a burden, taxation in a market, and at what is traditionally considered a
rather high level of taxation, can yield much closer to optimal economic
results. .</div>
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<br /></div>
<div class="MsoNormal">
I leave it to those ideologically opposed to government
intervention to find those exceptions. I do observe that the apparent
requirement for monotonicity in the supply and demand curves would seem to make
finding these exceptions difficult. </div>
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<br /></div>
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One interesting argument, though, which remains, is the
argument from liberty. This argument
would seem to suggest that the wanton destruction of scarce resources is,
somehow, ‘liberating.’ Indeed, we might almost define a wealthy individual as a person who has the power to inefficiently consume and waste and destroy large quantities of such resources. Indeed, the production of costly rich boy toys, of little to no benefit to the rest of society, can be considered a "Harberger Triangle" which could, and should, be taxed away. (Even the game Monopoly(TM) has a "Luxury Tax," though totally inadequate to the needs of its little society.)<br />
<br />
The 'argument from liberty' would seem, for example, to be the argument
against higher gasoline taxes in the <st1:country-region w:st="on">United States</st1:country-region>. The case shown here
is that a higher gasoline tax, with money more efficiently spent on public
transit, would free up resources for everyone, as the European experience seems
to show. And in the US, the situation is even worse, since the production of oil and oil products is subsidized, and the price kept depressed. The reality is, however, that the production of real resources <i>cannot </i>be subsidized. While the notional price may be kept down, this can only be done by higher taxes on the real value of other economic necessities.<br />
<br />
This is simple physics. And by the triangle inequality, such taxation of one necessity to subsidize the production of another has its own cost, and the net result is a reduction in the total real value of resources available to society. Society is the poorer as a result.</div>
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There does remain the issue of determining the balance
between efficiency and quantity of production in any particular market required
for the proper functioning of an economy.
Considerations of scale indicate that, contrary to what is shown in the
diagrams, the first unit of anything is seldom the most efficiently
produced. Rather, there is an optimum
scale of production, that which minimizes the average cost, (This ignores issues
of demand.) and we must consider this to be true for an entire economy as well
as for a particular production process. While with this consideration the improvement
in economic efficiency would not be as great, it must still be expected to be
impressive.</div>
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<br /></div>
<div class="MsoNormal">
Further, it should be easier to tax economic wants as
opposed to economic needs. (Although see
problem three, below.) A more efficient economy, however, needs less, and is
more capable of servicing wants. </div>
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<br /></div>
<div class="MsoNormal">
“Deadweight loss” is
also found in other market situations.
It would seem that, at the least, these other situations also need to be
re-examined. </div>
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<br /></div>
<div class="MsoNormal">
For example, the most marginal producers and the least avid
consumers in a particular market can also be eliminated when the costs of
production are increased by the costs of meeting a regulation. (It is cheaper just to make the cost of not doing nasty things marginally cheaper. The nasty thing tax will restrict supply of benefits by forcing the internalization of costs. We accepted the pollution of our wor(ld)k for the individual benefits they provided. But with great inequality, for most of society (>85%) the benefits of for the individual outweigh the costs to societ(ies)y (value to the individual) (benefits)These kinds of
regulation also can increase economic efficiency. Unlike the cost to the producer imposed by a
tax, however, the government does not directly recover the costs imposed by
such regulation. These costs are instead spent meeting the requirements of the
regulation. In <b><span style="font-family: "arial" , "sans-serif";">Diagram 2, P*</span></b> is the price retained by the
producer, which is the price <b><span style="font-family: "arial" , "sans-serif";">P’ </span></b>paid by the consumer,
minus the cost to the producer of meeting the regulation.<br />
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Instead of the tax wedge, we have the revenue in the area <b><span style="font-family: "arial" , "sans-serif";">Q’
x (P’ – P*), </span></b>revenue which with a tax wedge would be going to the
government, going instead to pay for meeting the regulation. The benefits are reaped by other sectors of
society. A regulation against pollution, for instance, benefits the consumers
of an otherwise contaminated resource.
As such, it essentially represents a rightward shift in the supply curve
for this resource. (Similarly, an
increase in pollution of a resource represents a leftward shift in the supply
curve of that resource.) This increase
in economic efficiency does provide compensation to the economy at large for
the cost of the regulation. </div>
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<div class="MsoNormal">
Further, the purpose of regulation is to attain some benefit
for the economy which cannot be captured in some unregulated market, and which
is presumably greater than the cost of the regulation. While one might hope, and expect, that the
benefit to society of the regulation would be at least equal to its cost, it
can be seen that, because of the increase in economic efficiency, society can gain
even when the direct benefits from the regulation are substantially lower than
its cost to the producer. (For the same
reason, although one can hope, and the government should of course try, to make
sure that the direct benefits to society of its expenditures are equal to the
costs, even when the direct benefits of government expenditure are below their
costs, there can still be a net gain to society, if these resources are not too
thoroughly wasted.) Certainly, in the
provisioning of an economy’s necessities, the inefficient application of scarce
resources may be necessary. However, even in these situations, alternative and
more efficient means of supply may be found. </div>
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<br /></div>
<div class="MsoNormal">
Interestingly, however, applying a tax wedge, or imposing
regulation, or other forms of government intervention, such as price ceilings
or price floors, are not the only ways to increase economic efficiency. Monopolies also eliminate much inefficient
production of goods and services, as shown.</div>
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<div class="MsoNormal">
Monopolies produce at quantity <b><span style="font-family: "arial" , "sans-serif";">Q<sub>M</sub></span></b>,
<b><span style="font-family: "arial" , "helvetica" , sans-serif;">(</span><span style="font-family: "arial" , "sans-serif";">Diagram
3) </span></b>the quantity where the increase in cost for producing another
unit equals the increase in revenue for selling another unit.<br />
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<br /></div>
<div class="MsoNormal">
This quantity
maximizes their profit. (This is
different from a competitive market, where the sum of production of all firms
would be where the Marginal Cost, or the Supply curve, intersects the Demand
curve.) With monopoly, the striped areas are the costs (Red striped) and
benefits (Green striped) forgone by society. These resources which would
otherwise be consumed, these costs, may be more efficiently applied to other
sectors of the economy. The solid areas are costs borne (Red) and benefits
provided (the Greens) under monopoly.
The light green regions are monopoly profits which, since a monopoly is
a part of society, does count as an increase in social welfare. We may expect
something similar with monopsonies, and to a somewhat lesser extent, with
oligopolies, and oligopsonies. With oligopolies and oligopsonies, we would
expect a greater elimination of inefficient production when they are collusive,
and a less but a still significant degree of elimination when they are competitive.
With oligopolies, although some inefficient producers may be protected because
of the higher prices resulting from the reduced quantity produced, (See: <a href="http://anamecon.blogspot.com/2012/02/oligopoly-and-economy.html">anamecon.blogspot.com/2012/02/oligopoly-and-economy.html</a>)
a reduced quantity <i>is</i> produced, and
those firms which remain in production limit their production to their most
efficient processes. The so called deadweight region of forgone costs and forgone
production lies between the kink in the demand curve, the equilibrium point for
oligopolistic producers, and what would be the competitive equilibrium which
would result from the production of many small firms. </div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
To return to monopolies, the great majority of benefits accrue
to the owners of the monopoly, typically a small minority of the members of
society. The consumer benefits, on the
other hand, are much less, and much reduced from the competitive case. Indeed,
by comparing the tax wedge in a competitive market with the monopoly case, we
find the social welfare under monopolies is exactly the same as social welfare
under a government tax wedge, where the wedge is such that the marginal cost to
producers equals their marginal revenue.
The competitive case results in a more equitable distribution of
benefits between consumers and producers. Of course, consumer benefits per se
are also much less under taxation, the same as under monopoly, and the producer
surplus much less. However, the government spreads much of its income widely. It
is, in its way, both a consumer and a producer. It re-distributes consumption,
and capitalizes production, both directly, through capital investments, and
indirectly, through subsidy of production, and creation and maintenance of infrastructure.
And all of its expenditure, purported to be for the public benefit, does, one
way or another, enrich various sectors of the economy.</div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
One problem with the tax wedge, however, because it favors
the more efficient producers, it also favors the economic drift toward
concentration of ownership, and the creation of oligopolies and eventually monopolies.
Narrowly held monopolies cannot be expected to spread their profits. Neither can monopolists be expected to spend
their profits to provide services which increase the efficiency of the larger
economy. Monopolies once formed, and
where not widely owned, further to aggravate the natural tendency of economies
to concentrate wealth and power, a concentration which leads to economic
instability and collapse. This is especially so because the power concentrated
in monopolies tends to translate into political power. And the monopolist must be expected to use
this power to further his power, mitigating the impact of the tax wedge on his
revenue. </div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
A second problem is that producers which escape taxation
will eventually displace those producers which are subject to taxation. The
result will be a reduction in both taxes collected and in economic
efficiency. This problem must be
considered especially acute in open economies, where tax paying domestic
producers can be expected to be displaced by non-taxpaying (and hence often
less efficient) foreign producers. The
interesting implication here is that, while a nation’s economy may be producing
less and consuming more, as an increased share of what is consumed is imported,
(much of what is considered production actually either enables consumption, or
is a form of consumption,) that economy need not be any better off for this
increase in consumption. Because of the
decrease in economic efficiency, fewer consumables will be efficiently used,
and more of this consumption will be squandered. </div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
A third problem is, of course, the politics of
taxation. Nobody likes to be taxed, and
the powerful, more than others, are capable of avoiding it. (This also bears on
the second problem.) This first suggests that the markets which serve the
wealthy will be the least efficient, even though these are the markets where an
economy can most easily bear the loss of marginal producers. (Marginal producers may be needed in the
production of an economy’s necessities.)
And this further suggests that a disproportionate share of an economy
will be dedicated to servicing the wealthy, even at the expenses of the
necessities of that economy, such as maintenance of infrastructure. A recent study has shown(1), for instance,
that in the United States today, no policies are enacted by the government
which are not also approved by the wealthy elite. An implication of this is that the tax burden
upon this elite can only be expected to diminish, and thus that the burden of
taxation on the rest of economy and the population can only increase.** </div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
One final consideration.
As an economy increases in efficiency, it inherently becomes less
stable, and more vulnerable to collapse. An efficient economy becomes dependent
on its efficiency in order to be productive enough to sustain itself. The greater the efficiency, the greater its
dependence. A reduction in efficiency
will result in a reduction of production, perhaps sufficient enough that that
economy can no longer sustain itself. </div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
A particular consideration regarding improvements in
efficiency brought about by regulation and the tax wedge, where these increases
in efficiency are already established, is that removing or even merely reducing
these factors will result in a reduction of that efficiency, and a resulting
reduction in the productive capacity of that economy. That economy may no longer be able to sustain
itself. With a critical reduction in production, cascades may result, and the
possibility of sectoral and even general collapse. Great care, therefore, should be exercised in
the reduction of the size of tax wedges, or the elimination of any regulation. </div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
*Efficiency is a multiplicative factor in production, not an
additive one. Although unlike thermodynamic efficiency, economic efficiency may
be greater than 1, it is also subject to diminishing returns, at least where
matters of the production of real goods and services are concerned.</div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
**This statement assumes that the wealthy are actually taxed
at all, which my studies indicate is not, in any real sense, the case. Taxation
of the wealthy is merely nominal. Real
taxation of the wealthy is only against their future consumption, a future
which, for almost all of the wealthy, is ever receding. However, a merely nominal rate of taxation is
not without real consequences for an economy.</div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
(1)Testing Theories of American Politics: Elites, Interest Groups, and Average
Citizens Martin Gilens and Benjamin I.
Page <a href="https://scholar.princeton.edu/sites/default/files/mgilens/files/gilens_and_page_2014_-testing_theories_of_american_politics.doc.pdf">https://scholar.princeton.edu/sites/default/files/mgilens/files/gilens_and_page_2014_-testing_theories_of_american_politics.doc.pdf</a></div>
greghttp://www.blogger.com/profile/08201906679062960215noreply@blogger.com0tag:blogger.com,1999:blog-2957498637105757084.post-36128756867568339102017-01-19T19:22:00.000-05:002017-01-19T19:22:50.328-05:00On the Social Benefits of Taxation<div class="separator" style="clear: both; text-align: center;">
<br /></div>
<div class="separator" style="clear: both; text-align: center;">
<br /></div>
<h3 style="clear: both; text-align: left;">
<b>On the Social Benefits of Taxation</b></h3>
<div class="separator" style="clear: both; text-align: left;">
<br /></div>
<div class="separator" style="clear: both; text-align: left;">
Here we present a proof, or at least a demonstration, without words. Or labels. For the cognoscenti, or even just those having some familiarity with Econ 101, the diagrams as they are should be enough to work out the point. And if not, labels to the diagram and explanation will be provided next week.</div>
<div class="separator" style="clear: both; text-align: center;">
<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEi5xsXyCabLWcxMQN6_9gjwvRKy_opG16LigyMx658RfeK7aVy1mrripmzEW0RHeoFFxrkJWN8GUM08K5Hqm2weaVCVRr-ds2fOklQssB1XzAlra6tCn1ahixNZ2KmHBZUJ6PoMDcImZGEE/s1600/On+the+Social+Benefits+of+Taxation.jpg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" height="448" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEi5xsXyCabLWcxMQN6_9gjwvRKy_opG16LigyMx658RfeK7aVy1mrripmzEW0RHeoFFxrkJWN8GUM08K5Hqm2weaVCVRr-ds2fOklQssB1XzAlra6tCn1ahixNZ2KmHBZUJ6PoMDcImZGEE/s640/On+the+Social+Benefits+of+Taxation.jpg" width="640" /></a></div>
<div class="separator" style="clear: both; text-align: center;">
</div>
<div class="separator" style="clear: both; text-align: center;">
</div>
The result is quite robust.<br />
Please enjoy.greghttp://www.blogger.com/profile/08201906679062960215noreply@blogger.com0tag:blogger.com,1999:blog-2957498637105757084.post-52855008278765951422016-12-31T20:27:00.000-05:002016-12-31T20:27:22.738-05:00Knowledge and Power<!--[if gte mso 9]><xml>
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<br />
<div class="MsoNormal">
Knowledge and Power.</div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Knowledge is not power.<span style="mso-spacerun: yes;">
</span>Knowledge is the complement of power. Knowledge without power is
impotent.<span style="mso-spacerun: yes;"> </span>Power without knowledge- is
worse.<span style="mso-spacerun: yes;"> </span>Knowledge and power are different
things, which together can combine to achieve great purpose. </div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Knowledge serves as a multiplier of power.<span style="mso-spacerun: yes;"> </span>Applicable knowledge can greatly increase the
effectiveness of power. Conversely, power applied without the proper knowledge
will at best be wastefully and inefficiently used. The effect of the
application of that power will be distorted from and diminished from its
intention.<span style="mso-spacerun: yes;"> </span>The situation resulting from
such an application of power may even be worse than if that power had never
been applied at all.<span style="mso-spacerun: yes;"> </span><span style="mso-spacerun: yes;"> </span>Even when power badly applied does achieve its
goal, the expense of it applied without proper knowledge will be much greater
than necessary, the result invariably inferior, and the consequential damage due
to those aspects of that power misapplied may be extensive. <span style="mso-spacerun: yes;"> </span>Power will be wasted,<span style="mso-spacerun: yes;"> </span>Its sources may be compromised.<span style="mso-spacerun: yes;"> </span>Its objectives may be irretrievably
lost.<span style="mso-spacerun: yes;"> </span></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
The more demanding the situation, the greater the
constraints, the greater the requirements for knowledge.<span style="mso-spacerun: yes;"> </span>And the greater the consequences of
ignorance.</div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Against this, knowledge comes at a cost, and this cost rises
with the increase in the quantity and quality of knowledge acquired, and may
become prohibitive. Situations arise, therefore, where the costs of the
knowledge necessary for the proper application of<span style="mso-spacerun: yes;"> </span>power, and the costs involved in the actual
application of that power, exceed the ability of the actor to bear. These costs may even exceed the
return on even judiciously applied power.</div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Knowledge is not to be confused with information. Knowledge
comes with the ability to weigh information, and properly weighed information
contributes to knowledge, and thus, recursively, to the ability to properly weigh
information. Conversely, improperly weighed information may actually detract from knowledge, and, recursively, reduces the ability to properly weigh information, and thus, the ability to acquire knowledge. </div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
As a multiplier of power, proper knowledge of how to apply
power will amplify that power.<span style="mso-spacerun: yes;"> </span>However,
one of the most important uses of knowledge is to know when to apply power. And when not to.</div>
greghttp://www.blogger.com/profile/08201906679062960215noreply@blogger.com0tag:blogger.com,1999:blog-2957498637105757084.post-92061005491676685132016-11-11T11:22:00.001-05:002016-11-11T11:22:15.073-05:00After the Election<br />
Here's a nice post mortem of the election by Dylan Matthews over at VOX:<br />
<br />
<a href="http://www.vox.com/policy-and-politics/2016/11/9/13572172/donald-trump-white-working-class">http://www.vox.com/policy-and-politics/2016/11/9/13572172/donald-trump-white-working-class</a><br />
<br />
Trump also promised to massively build infrastructure while cutting taxes. Since these are mutually exclusive it will be interesting to see which he chooses.<br />
<br />
More military means less of everything else, including the things we have the military to protect in the first place. Like rights and such.<br />
<br />
Getting rid of the EPA means more rural people (who mostly voted for Trump,) will be buying their water in stores.<br />
<br />
Because of reduced taxes and government spending, the demand side of the economy will contract, leading to higher amounts of money being taken out of circulation. Thus continued deflation. And low growth.<br />
<br />
The rich have shown that who they really wanted was Trump, at least as indicated by stock prices. Hillary allowed herself to be used by Wall Street. They never loved her as one of their own.<br />
<br />
<br />
<br />
<br />greghttp://www.blogger.com/profile/08201906679062960215noreply@blogger.com0tag:blogger.com,1999:blog-2957498637105757084.post-13648470404279083642016-09-30T16:13:00.001-04:002020-04-23T19:24:51.742-04:00On Hyperinflation <!--[if gte mso 9]><xml>
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<br />
<div class="MsoNormal">
Previously, we asserted that the standard definition of
money was in error.<span style="mso-spacerun: yes;"> </span>Money does not
constitute a store of value.<span style="mso-spacerun: yes;"> </span>Money,
fiat money, has no intrinsic value.<span style="mso-spacerun: yes;"> </span><span style="mso-spacerun: yes;"> </span>It only constitutes a store of demand. <span style="mso-spacerun: yes;"> </span>In particular, it is demand on the real
production of goods and services of the society whose government recognizes the
money as ‘tender.’<span style="mso-spacerun: yes;"> </span>(Money has various
forms, which may also be exchanged for each other. This distorts its actual exchange
value.)<span style="mso-spacerun: yes;"> </span>Even more exactly, money is a
token offered in exchange for either other tokens, other ‘forms of money,’ or
for goods and services produced by the economy, or needed or used by the
economy.<span style="mso-spacerun: yes;"> </span>(We will call any of these
things, or any combination of these things, (real) resources.)<span style="mso-spacerun: yes;"> </span>Its current value is roughly determined by
the ratio of the flows of goods and services to the (opposite directed) flow of
money. The flow of money is nominal, in the sense that, for a given rate of
flow of goods and services, the greater number of units of money in the
countervailing flow of money, the lower the value of each unit. Thus, the value
of the unit, the dollar, is determined by the ‘physical quantity’ of goods and
services exchanged in the economy divided by the number of units, of dollars,
those goods and services are exchanged for.<span style="mso-spacerun: yes;">
</span><span style="mso-spacerun: yes;"> </span>Money’s value is not directly
affected by the amount which is exchanged for other forms of money, nor the
(lesser) amount of goods and services exchanged in barter.</div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Aside from the flow of money, there is a stock of money,
just like there is a stock of real resources and assets, which, at any given
moment, are not being actively exchanged. The standard definition of money
implies that this stock of money constitutes an asset, a 'financial' asset. And
therefore, according to the standard definition, the value of all this money
should be added to the stock of real goods, services and real assets in the
economy when calculating the total 'value' of capital in the economy.<span style="mso-spacerun: yes;"> </span></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
However, money is only an 'asset' to the individual.<span style="mso-spacerun: yes;"> </span>The total value of a society, of all its
assets and production, is independent of the total quantity of money.<span style="mso-spacerun: yes;"> </span>Money is not an ‘asset’ to society, in the
sense that the ‘value’ of the total quantity of money in a society is added to
the total value of society.<span style="mso-spacerun: yes;"> </span>It is only
an asset in the sense that it enables certain forms of exchange.<span style="mso-spacerun: yes;"> </span>In this sense, it acts as a multiplier of
value. (Multiplication of value I discuss elsewhere.<span style="mso-spacerun: yes;"> </span>I only mention here that its value as a
multiplicative factor depends on its distribution, and not its nominal
quantity.)<br />
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Invert the usual definition.<span style="mso-spacerun: yes;">
</span>Money has value in terms of the things it is buying. In traditional macroeconomics, money's value is given by the so called "Equation of Exchange:" <b>M= P x Q/V.</b> In this equation, <b>M</b> is the stock of money, the total number of dollars, <b>P </b>is the Price level of things, sort of the 'average' number of dollars exchanged for each thing, <b>Q</b> the quantity of things exchanged, and <b>V</b> the average velocity of the total amount of money.<span style="mso-spacerun: yes;"> Now this equation is usually used to evaluate the total quantity of money <b>M</b> in an economy, so <b>V</b> can change. But really, the velocity of the money in circulation does not change, unless the velocity and/or number of <i>things</i> in circulation changes, so when the <b>V </b>of the equation changes, what it is showing is the share of the total money supply which is actually in circulation in the real economy, and what share of the total money supply is in savings or bonds or other financial instruments.</span> It shows the proportions that <b>M</b> is divided between circulation in the real economy, and the 'churn,' where different forms of money, bonds and other instruments of debt, are traded among themselves.* Thus, when <b>V</b> goes down, money is being taken out of circulation in the real economy and 'invested' in the churn. When <b>V</b> goes up, money is being taken out of the churn, and put into the real economy. <span style="mso-spacerun: yes;"> </span> <br />
<br />
With this understanding, we can simplify the equation to: <b>M = P x Q, w</b>here the terms are as described above. This can be understood in either macroeconomic terms, in terms of average price level times some quantity measure of all things exchanged, or in terms of microeconomics, as the average price of any particular good, times the quantity of that good, giving the total quantity of money, the number of dollars, (or in general the number of units that <b>P</b> is expressed in. which need not be dollars.) that is being exchanged for that particular good. It can be visualized as the flow of money, and the opposing flow of the good or service, in its own particular channel.<br />
<br />
If we rearrange, then the price of any particular good, or of the price level of all goods if we are talking about the economy as a whole, can both be expressed as: <b>P = M/Q. </b>If <b>M</b> increases, and/or if <b>Q</b> declines, the price or a good, or the price level of an economy, goes up. </div>
</div>
<div class="MsoNormal">
We have talked about what we call the churn. The stock of money experiences activity separate from its motion in the real economy. It is not kept in mattresses, (although in a sense it might as well be,( churning:<span style="mso-spacerun: yes;"> </span>Forms of money are exchanged for other forms
of money.<span style="mso-spacerun: yes;"> </span>However, this ‘churn’ usually
has no immediate effect on the value of money in the real economy, as long as
it does not affect the movement of money out of the churn and into the real
economy, or out of the real economy and into the churn.) <span style="mso-spacerun: yes;"> </span>Similarly, barter, the direct exchange of
goods,<span style="mso-spacerun: yes;"> </span>does not affect the value of
money, although changes in the amount of barter, where they alter the amount of
goods exchanged for money, would change the value of money in the opposite
direction. That is, if a greater percentage of goods were being exchanged in barter, then the money in circulation would be chasing fewer goods. This would result in inflation. (This analysis ignores the effect of the expectations of
participants, which may indeed alter the value of money in the real economy.)</div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Demand as debt.</div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Many have heard about instances on hyperinflation, and tales
of wheelbarrows of money being exchanged for loaves of bread.<span style="mso-spacerun: yes;"> </span>During the Weimar hyperinflation in Germany
in 1923, before computerized money, they couldn’t print the money as fast as it
was being inflated.<span style="mso-spacerun: yes;"> </span>Bills printed with
already outrageous denominations had to be restamped with denominations hundreds
and thousands of times higher, before they could actually be issued, because
the original denominations were already to small to be useful.</div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
What we don’t hear about, however, are busloads of money
being exchanged for houses. It would be rare, one would think, but surely, if
it happened, it would be memorable. <span style="mso-spacerun: yes;"> </span>But
no one sells houses during periods of hyperinflation. Or automobiles, or
appliances, or many of the more ‘advanced,’ but in the end, less immediately essential
<span style="mso-spacerun: yes;"> </span>products of an economy.</div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
For what happens is that the monetary economy collapses onto
essential goods, the most essential being food and fuel.<span style="mso-spacerun: yes;"> </span>But the circulation of these goods, in the
modern economy, and the quantity of money exchanged for them, takes up only a
small portion of the market of the entire economy.<span style="mso-spacerun: yes;"> </span>So the total quantity of money in
circulation, whose value (as tokens of demand) was originally based on fact
that things demanded consisted of the entire quantity of goods and services in
the whole economy, is nominally much greater than the nominal value of the
circulation of essential goods and services like food and fuel.<span style="mso-spacerun: yes;"> </span>The supply of valuable goods contracts to
only those which are essential.<span style="mso-spacerun: yes;"> </span>Demand
is now concentrated on a much smaller portion of the economy.<span style="mso-spacerun: yes;"> </span>Meanwhile, the value of non-essential goods crashes, as well as essential goods held in surplus.<br />
<br />
In our equation: <b>P = M/Q</b>, then, what first happens is that <b>M </b>increases, not as a result of government printing, but as money is taken out of the churn, and put into the real economy. This is mostly rich people panicking, although ordinary people are also taking their money out of the banks. As this process progresses, the economy begins to contract onto essential goods. Thus the quantity <b>Q</b> of goods exchanged for money decreases. </div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Imagine that suddenly, all that anybody wanted to buy in the
economy was bread.<span style="mso-spacerun: yes;"> </span>With over $!.4
trillion of dollars cash in circulation, M0,<span style="mso-spacerun: yes;">
</span>M2 the larger measure of less liquid money is over $13 Trillion, M3,
still money but no longer counted, we may estimate, from recent trends at at
least $19 Trillion. If M2 tells us the amount of money in mattresses, the
difference between M2 and M3 we might consider money buried in backyards.<span style="mso-spacerun: yes;"> </span>It will all come out.<span style="mso-spacerun: yes;"> </span>With the market for bread at the outset about
1 billion dollars the price of that bread would become extremely high extremely
fast.<span style="mso-spacerun: yes;"> </span>Of course, there are other forms
of food, which may be regarded as equally essential, (although high priced
foods might also be priced out of the market.)<span style="mso-spacerun: yes;">
</span>The size of the retail food market in the US is around $50 Billion per week,
or<span style="mso-spacerun: yes;"> </span>$2.5 Trillion per year.</div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
<span style="mso-spacerun: yes;"> </span>And this is what
happens at the outset of the progression of hyperinflation.<span style="mso-spacerun: yes;"> </span>The government doesn’t have to print
money.<span style="mso-spacerun: yes;"> </span>The money is already out there.<span style="mso-spacerun: yes;"> Some of it</span> is just being used for ordinary business
in ordinary ways.<span style="mso-spacerun: yes;"> Much, perhaps even most of it, is in the churn: Ordinary savings accounts for ordinary people, high powered financial instruments for the wealthy. </span>But as runaway
inflation, and then hyperinflation begin to take hold, people increasingly see
money as overvalued. Durable goods and fixed assets also begin to be seen as overvalued, at least in terms of money.<span style="mso-spacerun: yes;"> </span>And they see other people seeing that, too.
Therefore everyone wants to exchange their money for (basic) goods as fast as
possible. As the demand becomes ever more concentrated on essential goods, the
velocity of money also increases.</div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
<span style="mso-spacerun: yes;"> </span>As inflation progresses,
increasingly goods become sorted into their essential value. The value of
non-essential goods and assets decreases, relative to essential commodities.<span style="mso-spacerun: yes;"> </span>Money becomes preferentially spent on those
of greatest essential value, and the prices of these increase the most as
demand becomes concentrated on them.<span style="mso-spacerun: yes;"> </span>Those
holding money in savings and other financial instruments, withdraw and liquefy
them, and bring them into the real economy, where they add to the already
increasing forces of inflation.<span style="mso-spacerun: yes;"> </span><span style="mso-spacerun: yes;"> </span></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
The government faces a choice: Either to take money out of circulation as fast as possible, or to print money. <br />
<br />
The proper response of government is not to print money in
an attempt to stay ahead of it. This merely aggravates the problem and drives
the accelerating inflation.<span style="mso-spacerun: yes;"> </span>While
initially, government issued money is not the problem, as the government issues
money at an ever greater rate, the entire nominal value of money in circulation
does becomes government issued. (In the limit.)<br />
<br /></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
The proper response of government is to take money out of
circulation as fast as possible.<span style="mso-spacerun: yes;"> </span>One
way is a high sales tax. However, this will not prevent the entry of money into
the circulation of the real economy from the churn, the stock of money
circulating in banking and finance. Therefore, the liquid assets of the
wealthy, and foreign holdings, must also be frozen, and offshore financial
assets prevented from repatriating.<span style="mso-spacerun: yes;"> </span>So
far as the wealthy control the government, this is resisted.<span style="mso-spacerun: yes;"> </span></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
When the wealthy become aware, not only that the stock of
money is too greatly over valued, but aware that others also know,<span style="mso-spacerun: yes;"> </span>we may expect a rush into more tangible
assets, with ordinary people, by which I mean basically the entire 99%, priced
out of essential goods and services.<br />
<br />
And or course, it can always be that the government actively pursue the destruction of its unit of money. One consequence of this would be to consolidate the gains of the wealthy, and so a government under the control of an oligarchy might do this.<br />
__________________<br />
<br />
*[Edit:22-04-2020] The activities financial sector don't directly affect the price of things in the real sector, except as the financial sector, because it is <i>the </i>source for nominal profits, attracts and holds money away from the real sector.<br />
<br /></div>
greghttp://www.blogger.com/profile/08201906679062960215noreply@blogger.com0tag:blogger.com,1999:blog-2957498637105757084.post-75250376788959849092016-08-29T00:10:00.000-04:002017-04-30T19:27:43.665-04:00The Growth Trap<!--[if gte mso 9]><xml>
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<span style="font-size: 11.0pt;">The<span style="mso-spacerun: yes;">
</span>Growth Trap</span><br />
<br />
<span style="font-size: 11.0pt;">Every economy, every self-organizing
system which is not also self-limiting <i style="mso-bidi-font-style: normal;">within
the bounds set by its environment</i>, grows until it exceeds the ability of
that environment to support and sustain it. It then collapses.<span style="mso-spacerun: yes;"> </span></span><br />
<br />
<span style="font-size: 11.0pt;">The collapse of a modern economy can be
expected to be catastrophic.</span><br />
<br />
<span style="font-size: 11.0pt;">When an economy first develops, acquiring
resources is difficult and expensive. There is little surplus to be </span><br />
<span style="font-size: 11.0pt;">invested,
and growth is slow. This is despite the fact that resources are often
accessible and plentiful. The methods of extracting the resources are
primitive and inefficient, and there is little surplus.<span style="mso-spacerun: yes;"> </span>The demand for and uses for new resources are
limited, and efforts at developing new resources are often desultory. </span><br />
<br />
<span style="font-size: 11.0pt;">However, as infrastructure is invested in and
developed, the relative cost of acquiring and developing resources
decreases.<span style="mso-spacerun: yes;"> </span>More uses are found for
extracted resources, providing motive for ever greater extraction. Since it is
easier and cheaper to develop uses for resources, rather than new sources,
demand, in general, outstrips supply, keeping the profit margins of producers
high. For the producers, this means more resources are available to invest in
expanding extraction and distribution, thus increasing the supply of these extracted
resources available to be put to other uses in the economy.<span style="mso-spacerun: yes;"> </span> </span><br />
<br />
<span style="font-size: 11.0pt;">With growth, the economy is able to exploit
resources at an accelerating rate. The limiting factor is now no longer
the costs of extraction, but the limitations in demand, the final uses for the
resources, and the necessary distribution systems, which also must be
developed.</span><br />
<br />
<span style="font-size: 11.0pt;">In order to extract, distribute and employ
the resources, it is necessary to develop an infrastructure, There is a cost,
in resources consumed, to developing this infrastructure, There is also a cost
to maintaining this infrastructure, and there is also a cost to operating this
infrastructure. </span><br />
<br />
<span style="font-size: 11.0pt;">When resources are still plentiful and cheap
to extract, these costs are relatively low. The infrastructure grows
robustly, both because the costs of extraction are low and because it is still
new, So maintenance costs are also low.</span><br />
<br />
<span style="font-size: 11.0pt;">Clearly, however, with finite resources, or
even a finite average density of resources, or with a finite rate of renewal of resources, there are limits to any economy’s
ability to grow. </span><br />
<br />
<span style="font-size: 11.0pt;">Indeed, as the plentiful and inexpensive
resources are consumed, ever more marginal resources, resources more costly to
extract and process, more distant and difficult to transport, become necessary
to expand and sustain the economy. The infrastructure must be expanded to
develop these resources, and at an increasing cost. What is more, the
increasing cost of extraction must be passed on, and this increases the
maintenance cost of the entire infrastructure. Less and fewer resources are
available for expansion of that infrastructure, which is necessary both to
supply other uses and to extract the ever more marginal and distant
resources.<span style="mso-spacerun: yes;"> </span>These costs are
compounded<span style="mso-spacerun: yes;"> </span>by the fact that the increasing
cost of extraction also increases the cost of operating the infrastructure.</span><br />
<br />
<span style="font-size: 11.0pt;">Eventually, as the availability of resources
decreases, and their cost of extraction increases, the cost in resources
necessary to develop new infrastructure, and more importantly, the cost in
resources necessary <i>to maintain and operate<span style="mso-spacerun: yes;">
</span>the infrastructure already built</i>, exceeds the ability of the economy
to extract benefits from those resources. </span><br />
<br />
<span style="font-size: 11.0pt;">Increasingly, maintenance will be sacrificed
to cover the increasing costs of operation. The result will eventually be a
stage where the infrastructure can no longer be maintained, when the
maintenance budget passes below a critical threshold, but will be subject to
increasing catastrophic failure. This threshold is roughly when the budget is
no longer able to cover both preventative maintenance and essential repairs. With inadequate preventative maintenance, essential repairs will increase, eating into the budget for preventative
maintenance. As the budget for preventative maintenance decreases, the need for essential repairs will increase, in a vicious spiral. This process is sped
by increasing costs of operation, which the declining quality of the infrastructure also aggravates, and by the increasing
rate of extraction of money and real resources from the real economy by the
financial economy.<span style="mso-spacerun: yes;"> </span></span><br />
<span style="font-size: 11.0pt;"><span style="mso-spacerun: yes;"> </span></span><br />
<span style="font-size: 11.0pt;">In the case of the modern economy, then,
there are two relevant systems: The real economy itself, and the
financial economy which feeds off the real economy.<span style="mso-spacerun: yes;"> </span>The financial economy produces nothing of
substance itself. When useful is serves as a multiplier of production, by
increasing the efficiency of allocation of resources. When overgrown it diverts
more resources to itself than it saves the real economy by that allocation of
resources. The result is a decline in the efficiency of the real economy, and its ability to grow.<span style="mso-spacerun: yes;"> </span></span><br />
<span style="font-size: 11.0pt;"><span style="mso-spacerun: yes;"> </span></span><br />
<span style="font-size: 11.0pt;">In any case, this happens at a late stage in the
development of the real economy, when the resources available to the real
economy to mount opposition to the growth of the financial economy are diverted away. Part of this is the result of increasing real costs in the rest of the economy outlined above. Part is by the increasing diversion of resources by and to the financial sector itself. (Inter-sectoral competition for resources is seldom considered by business leaders.)<span style="mso-spacerun: yes;"> Effective r</span>egulation of the financial sector then fails. (One part of this process is that one of the consequences of the increasing concentration of wealth is that the value of
non-financial rewards offered by the society declines, and become devalued,
reducing the cost of corrupting other institutions.)<span style="mso-spacerun: yes;"> </span></span><span style="font-size: 11pt;">Once the financial economy evades the controls set on it by the real economy, it mimics the real economy:</span><span style="font-size: 11pt;"> </span><span style="font-size: 11pt;">It grows without bounds. Feeding off the real economy, it is also a non-self-limiting, self-organizing system.. It too is subject to overgrowth and collapse when it exceeds the ability of the real economy to support it . When this occurs, if and only if it occurs before a critical point in the growth of the real economy, the real economy may yet be saved. This is not because the real economy is self-limiting. It is only because it has been increasingly organized to service the financial economy, and with the collapse of the financial economy, the real economy may be reorganized into a self-limiting form. This is not guaranteed. This may not even be likely. And this still depends on whether or not the real economy is already too big to be reorganized into a sustainable form. </span><br />
<span style="font-size: 11pt;"><br /></span>
<span style="font-size: 11.0pt;">So the financial sector then grows until it exceeds the ability of the real
economy to sustain it. This growth happens much more rapidly than happened in the real economy,
since the financial infrastructure is much less expensive to develop than the
real infrastructure.<span style="mso-spacerun: yes;"> T</span>he
financial economy diverts resources from the real economy to itself by making finance nominally more
profitable than real investment, thus diverting money, that is demand, on
resources away from the real economy. Money is taken out of the real economy faster than government spending can pump it in. This causes deflation in the real economy. Producers in the real economy are hurt two ways. Because of lags in production, prices of final goods are reduced vis a vis the prices of the factors which went into them. And demand for those final goods is also diminished. Even as this happens, the quantity of various forms of money in the financial economy
increases without bounds.<span style="mso-spacerun: yes;"> </span>This is
accompanied by ever greater concentration of wealth, and ever more extravagant
expenditure. This growth is in the demand side of the economy, which
conceals decline in the extracting and manufacturing sectors.<span style="mso-spacerun: yes;"> </span>GDP, for instance, does not distinguish
between growth in these producing sectors, and growth in consuming sectors such as retail and, increasingly, finance.<span style="mso-spacerun: yes;"> </span></span><br />
<br />
<span style="font-size: 11.0pt;">The <i>real</i> increasing costs of
maintaining the <i>real </i>economy, (and in particular its infrastructure,)
and the increasing <i>real</i> costs of its extraction of <i>real</i> resources
from the natural environment, are hidden by the mechanisms of externalization
of costs, both directly onto the environment (pollution) and onto labor, and by
government subsidies, by defaulted debts, and by the deferred maintenance of
the real infrastructure. These manipulations make the cost of extraction,
transport and fabrication of real resources appear cheaper than they really
are.<span style="mso-spacerun: yes;"> </span>However, while in nominal terms the
costs are reduced, in real terms the costs cannot be reduced, only hidden, and must increase
over time.<span style="mso-spacerun: yes;"> </span>The real costs of these
manipulations, however, transfer these costs onto other parts of the producing
sector. This increases the costs of production in these other sectors, an increase
greater than the reduction in apparent nominal costs.<span style="mso-spacerun: yes;"> </span>These manipulations of the real economy, as
well as the financial manipulations which enable them, enrich the financial and
consuming sectors, and impoverish the actual producers of real goods and
services.<span style="mso-spacerun: yes;"> </span>The productive sectors are
deprived the real resources necessary to grow, and ultimately to maintain
themselves.</span><br />
<br />
<span style="font-size: 11.0pt;">This financial extraction becomes ever more
difficult and costly, as the real economy becomes progressively
impoverished.<span style="mso-spacerun: yes;"> T</span></span><span style="font-size: 14.6667px;">he concentration and availability of extractable community assets declines. </span><span style="font-size: 11pt;">This decline in efficiency
means more labor is required for the</span><span style="font-size: 11pt;"> financial sector to </span><span style="font-size: 11pt;">extract wealth from the real economy. Thus, even though most labor
is no longer involved in real extraction and production, there results the
paradox of an increasing burden on labor in non-productive jobs. </span><span style="font-size: 14.6667px;">This is obscured by the fact that these financial costs are increasingly externalized onto the real economy, ie absorbed by </span><span style="font-size: 14.6667px;">non-financial industries and</span><span style="font-size: 14.6667px;"> labor . </span><span style="font-size: 11pt;">However,
because of the decreasing efficiency, the profit to be made off these jobs is
very low, and decreasing, and the pay must be commensurate.</span><span style="font-size: 11pt;"> </span><br />
<br />
<span style="font-size: 11.0pt;">Meanwhile, since the cost of all maintenance
increases, the cost of maintaining the burden of the financial and consuming
sectors is also increasing.<span style="mso-spacerun: yes;"> </span> the
costs required for extraction increase, the actual financial profits decline to
zero and even go negative. </span><br />
<br />
<span style="font-size: 11.0pt;">The degree of financial exploitation is not
reduced, but merely more resources are devoted to the process. Even as this
happens, fewer resources are available to the real economy. This is both
because the financial sector externalizes its costs onto it onto the real
economy, (and thus appearing artificially profitable,) and because greater real
resources must be expended in acquiring resources from an increasingly
impoverished natural environment.<span style="mso-spacerun: yes;">
</span>Combined, these processes render the usual indicators of economic health
and prosperity at least useless and even more likely misleading. Much
growth occurs in the wrong sectors, and is indicative of impending failure,
rather than success. </span><span style="font-size: 14.6667px;">Further, with increasing deregulation, more fraud may be expected, both in production, and in reporting on that production.</span><br />
<br />
<span style="font-size: 11.0pt;">Mankind has yet to develop a modern, self-limiting
economy.<span style="mso-spacerun: yes;"> Hunter-gatherer societies existed in ecological equilibrium with their environment, fitting into the limits set by the rate of replenishment of renewable resources. For pre-industrial economies, the growth trap must be considered as a possible factor in their ultimate decline. </span>Since economies ultimately
serve a population, clearly, with unrestricted population growth, no
self-limiting economy is possible.<span style="mso-spacerun: yes;"> </span>And
any non-self-limiting economy will be subject to the growth trap. </span><br />
<br />
<span style="font-size: 11.0pt;">More to the present, however, there is no
evidence that capitalism is self-limiting.<span style="mso-spacerun: yes;">
</span>Only a self-limiting economy can survive the growth trap.<span style="mso-spacerun: yes;"> </span>Only an economy which can limit its
consumption of renewable resources to some rate less than the rate those
resources are renewed, and its consumption of non-renewable resources to some
rate less than those resources can be recycled, can be indefinitely
sustained.<span style="mso-spacerun: yes;"> </span>All other economies will
fail. And a failing economy will be incapable of providing sufficient resources
for the survival of most of its members.<span style="mso-spacerun: yes;">
</span>Indeed, because of the enormous efficiencies brought about by a modern
economy, if that economy fails, such a failure will be catastrophic, and only
small percentage of the people who depend on that economy can be expected to survive.</span><br />
<br />
<span style="font-size: 11.0pt;">There still seems a choice, however, although, judging from their antics,
our political class seems incapable of confronting the issue.</span><br />
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<br />
Revised and expanded Sep 7,2016, Nov7, 2016, Feb 17, 2017greghttp://www.blogger.com/profile/08201906679062960215noreply@blogger.com0tag:blogger.com,1999:blog-2957498637105757084.post-74983316896474475262016-07-31T23:04:00.000-04:002017-02-17T23:11:11.590-05:00The Survival of the Marginal Part I<!--[if gte mso 9]><xml>
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<br />
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<br /></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Consider Darwin’s
Finches.<span style="mso-spacerun: yes;"> </span>Which changed first?<span style="mso-spacerun: yes;"> </span>Their bodies?<span style="mso-spacerun: yes;">
</span>Or their behavior?<span style="mso-spacerun: yes;"> </span>And why did
they change their behavior?</div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
The idea of the survival of the fittest is a mistaken understanding
of the dynamics of evolution.<span style="mso-spacerun: yes;"> </span>It is not
those best adapted to an environment who win the game of life.<span style="mso-spacerun: yes;"> </span>It is the weak, the losers in the competition
for supremacy within their environment and within their species, who in the end
triumph.<span style="mso-spacerun: yes;"> </span>The fittest either come
eventually to die, clutching the residues of their spoils, or survive on as
prisoners, trapped inside the bounds of the field of their victory, hemmed in
by the descendants of those they once drove forth into hardship.</div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
For when the strong drive out the weak, what happens to the
weak?<span style="mso-spacerun: yes;"> </span>In their home environment, the
weak may be well adapted, both physically and behaviorally, to exploit its
resources, and prosper.<span style="mso-spacerun: yes;"> </span>However, the
weak must also compete against those like them, but stronger, both for those
resources, and for the right to reproduce their kind.<span style="mso-spacerun: yes;"> </span>But since they are the weak, they are
outcompeted for food and reproductive rights by the strong.<span style="mso-spacerun: yes;"> </span></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
In a crowded environment, the strong <span style="mso-spacerun: yes;"> </span>may physically drive them into the
margins.<span style="mso-spacerun: yes;"> </span>Even if the weak are not
directly confronted by those stronger than they are, they may still be faced
with starvation.<span style="mso-spacerun: yes;"> </span>Certainly, they face an
unpleasant choice.<span style="mso-spacerun: yes;"> </span>They may choose to
endure, and eventually die, perhaps without issue.<span style="mso-spacerun: yes;"> </span>However, they may also choose to depart, and
move out into the margins of their former environment.<span style="mso-spacerun: yes;"> </span><span style="mso-spacerun: yes;"> </span></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
The margins will not be as favorable to the weak as was the
center of the ecology that the strong still claim. The behaviors which served
them in that environment will no longer be adequate, and different behaviors will be demanded. To survive, the weak will be forced to adapt. (And some will be
prepared for this, because their old behaviors will have failed them, and they
will be ready to change.) In particular and in general, a greater variety of
behaviors will be demanded. Physically, they may be mal-adapted to their new
environment, and their new behaviors must first compensate for this. Different
food sources must be pursued. Different locations for food and even different
varieties of food must be sought, because those sources they once relied upon
will no longer be adequate, if they are available at all. <span style="mso-spacerun: yes;"> </span>None of the sources which they once depended
on will be available in sufficient quantity. </div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Meanwhile, their enemies may follow them.<span style="mso-spacerun: yes;"> </span>They may be forced to deal with new
predators, who may see them as a new opportunity for predation.<span style="mso-spacerun: yes;"> </span>They may be forced to deal with new hazards. And
their survival will depend on their ability to adapt their behavior in
response. </div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
In the old environment, the strong of the species are in a
sense optimized, or will evolve to become so, both physically, and behaviorally.<span style="mso-spacerun: yes;"> </span>And when they do become optimized,<span style="mso-spacerun: yes;"> </span>the strongest will be the most fit to that
environment, and any individual who deviates, the carrier of any other random
mutation, will be inferior in its ability to compete, and thus selected
against. As long as their environment remains constant, so will the species,
and for these individuals, and their descendants, the process of evolution
effectively ceases. <span style="mso-spacerun: yes;"> </span>The only remaining
outlet for change, a domain of random drift, within which the external
pressures of selection are essentially absent, within which genetic alterations,
which still randomly occur, in no way change the functional relationship of the
species to its environment.<span style="mso-spacerun: yes;"> </span></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Those driven into the margins, however, are not optimized to
their new environment, either behaviorally, or physically. And because they are
suboptimal, and suboptimal possibly to a variety of different optima, both
physically and behaviorally, they may have choices.<span style="mso-spacerun: yes;"> </span>Their new environment may present them with a
selection of possible niches for them to move into, for them to both adapt to
and mould to their behavior. (Every time a species successfully colonizes a new
environment, it alters that environment, and thus the structure and
relationships of the niches occupied by the other species already occupying
that environment. and of course the species themselves.)</div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
<span style="mso-spacerun: yes;"> </span>First they must alter
their behavior so that with their imperfectly adapted bodies they may best cope
with their new reality. If they succeed and survive, and have issue, they pass
these behaviors on to their descendants.<span style="mso-spacerun: yes;">
</span>Physically, the descendants slowly evolve, as the shape of the new
environment potentiates net forces upon them. <span style="mso-spacerun: yes;"> </span><span style="mso-spacerun: yes;"> </span>These
provide relative advantage to the random mutations which create the altered
structures that improve the ability of the species to cope and prosper, and
relative disadvantage to those which do not. <span style="mso-spacerun: yes;"> </span>(Note the earliest generations have the
greatest opportunity to change behavior, and adopt to different niches.<span style="mso-spacerun: yes;"> </span>Indeed, a random physical adaptation which is
inappropriate to the behavior adopted by the parent may lead the descendant to
alter its behavior, and thus branch into an alternate niche. This suggests that
branchings, rather than predominately binary, would tend to be clustered about
points of colonization, when the differing <span style="mso-spacerun: yes;"> </span>opportunities reachable to the species are
greatest in availability, number, and variety.)</div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
The forces imposed upon the colonizing species would be of
two basic types, push and pull, pressures and opportunities.<span style="mso-spacerun: yes;"> </span>Singly, these would respectively tend to be
dispersive and attractive.<span style="mso-spacerun: yes;"> </span>However combinations
of opportunities could be dispersive, and arrays of sources of pressures
compressive.<span style="mso-spacerun: yes;"> </span>As a result of these
environmental forces, different combinations of vectors of radiation may result.</div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
There is also the possibility that colonization happens into
an environment where no particular niche offers sufficient opportunity for the
new species to survive. No singular alteration of behaviors would enable survival,
but a combination of <span style="mso-spacerun: yes;"> </span>two or more groups
of new techniques must be adopted if the species is, say, to acquire enough food to
survive. The species may eventually come to physically adapt to one or another
niche and specialize. It then may come to exploit that niche with sufficient
efficiency to survive. Due to environmental forces, this may involve acquiring
physical strength, over subsequent generations, and the weak become
strong.<span style="mso-spacerun: yes;"> </span></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
However, it may also be that specialization is not possible,
and the individual of the species must continue to exploit several niches in
order to survive. Since physical adaptation to one niche will likely compromise
its ability to exploit other niches, increase in the ability to exploit its
environment might then be primarily a result of an increase in the varieties of
behavior. <span style="mso-spacerun: yes;"> </span>Behavioral adaptation, especially
where an increase in the variety of behaviors is required, puts a premium on
intelligence.<span style="mso-spacerun: yes;"> </span>Of course, even the
simplest act of colonization requires more intelligence than is needed by an
optimally adapted species in its home environment.<span style="mso-spacerun: yes;"> </span></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
In the adaptation to its environment, a species acquires
those qualities it needs, but in more than the quantities it needs.<span style="mso-spacerun: yes;"> </span>The ability to meet the bare minimum of
demands of the environment will not be sufficient.<span style="mso-spacerun: yes;"> </span>Survival requires more than efficiency: In
the distribution of coping abilities in its environment, the abilities of
individuals in all but the lower tail of that distribution must exceed the
demands of the environment.<span style="mso-spacerun: yes;"> </span>This
necessarily includes intelligence.<span style="mso-spacerun: yes;"> </span></div>
greghttp://www.blogger.com/profile/08201906679062960215noreply@blogger.com0tag:blogger.com,1999:blog-2957498637105757084.post-70196177542015961062016-06-03T00:32:00.000-04:002016-06-03T00:33:55.273-04:00Rigging the Democratic Party, Continued<!--[if gte mso 9]><xml>
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<br />
<div class="MsoNormal">
<span style="font-size: small;"><span style="line-height: 107%;">Below is my
campaign literature for the election to be a Sanders delegate to the Democratic National Convention in Philadelphia at the end
of July. I brought slightly over 200 copies of it to the Sanders caucus in my
Congressional district. (There was another caucus for the 3 Clinton delegates from our district.) I handed
almost all of them out to other attendees at the caucus. </span></span></div>
<div class="MsoNormal">
<br /></div>
<span style="font-size: small;">
</span><br />
<div class="MsoNormal">
<span style="font-size: small;"><span style="line-height: 107%;">There were
some 300 men and women at the caucus. About 30 people, including myself, had earlier, online, applied to
be one of the 4 Sanders delegates. Most of
us were pretty naïve about parliamentary procedure, a fact that was used in a
maneuver which eliminated all but 8 of our names from contention. None the rest of us realized we would have to
be ‘nominated’ at the caucus, and our nomination seconded. So none of us were. </span></span></div>
<div class="MsoNormal">
<br /></div>
<span style="font-size: small;">
</span><br />
<div class="MsoNormal">
<span style="font-size: small;"><span style="line-height: 107%;">As for the 8
who <i>were</i> nominated, and seconded, these
8 were comprised of two groups of 4, each of which formed a ‘slate’ for the
full quota of the delegates for Senator Sanders. They were allocated to the
senator for winning the district. While
the 8 candidates were voted on individually, one slate, (the more willing to
compromise with Hillary slate,) won. On average something like 170 votes to
130.</span></span></div>
<div class="MsoNormal">
<br /></div>
<span style="font-size: small;">
</span><br />
<div class="MsoNormal">
<span style="font-size: small;"><span style="line-height: 107%;">The Democrats do themselves no favors with
this procedure, since it is incongruent with the electoral college, which is
an all or nothing process at the state level. The
result of their procedure is not optimized to result in the nomination of the
most electable candidate. </span></span></div>
<div class="MsoNormal">
<br /></div>
<span style="font-size: small;">
</span><br />
<div class="MsoNormal">
<span style="font-size: small;"><span style="line-height: 107%;">It is,
however, optimized to insure the <i>establishment</i>
candidate is the nominee. It minimizes (statistical)
variation, (Sort of like what would happen if you scored most of the points in a basketball game say, by a score of 73 to 65. But instead of it being called a win for you, it was called a tie.) and, assuming that the “Superdelegates,” some 15% of the total, and
who largely <i>are</i> the (Democratic) establishment, actually vote for the
establishment candidate, all but guarantees the nomination of the establishment
candidate, no matter what the outcome of the primaries. </span></span></div>
<div class="MsoNormal">
<br /></div>
<span style="font-size: small;">
</span><br />
<div class="MsoNormal">
<span style="font-size: small;"><span style="line-height: 107%;">It is not
enough for the outsider to just win the popular vote by over 18%. (719 is 17.7%
of the 4051 pledged delegates, which are more or less determined by the primaries.) He must capture 59% of the pledged delegates, or
2390 delegates, to overcome the establishment’s Superdelegates. </span></span></div>
<div class="MsoNormal">
<br /></div>
<span style="font-size: small;">
</span><br />
<div class="MsoNormal">
<span style="font-size: small;"><span style="line-height: 107%;">In order to
overcome the 719 Superdelegates, the outsider candidate would have to win virtually
every one of the 435 Congressional districts.
And some he would have to win by humongous margins, to gain enough
plurality of delegates. For a district
with an even number of delegates, a close victory leads to an evenly split
delegation. To split a district with say
8 delegates, 5 to 3, the winning candidate would have to win with over 56% of
the vote. (I think that’s the way it works.) To split a district with 7
delegates 5 to 2, (instead of just 4 delegates to 3) the candidate would have to win over 65% of the vote. This he would have to do in may districts in
order to obtain the necessary delegate plurality. In the reality, this is assuming the other
pledged delegates, the at large and the PLEO (Party Leader and Elected Officials)
delegates, are evenly split.</span></span></div>
<div class="MsoNormal">
<br /></div>
<span style="font-size: small;">
</span><br />
<div class="MsoNormal">
<span style="font-size: small;"><span style="line-height: 107%;"> The
whole process is window dressing. The
procedure, and the Superdelegates, effectively disenfranchise the Democratic
voters. If Senator Sanders does win, it
will only be because the Democratic establishment has decided that Hillary Clinton is
unelectable. Which, by the way, she likely
is. Whether the party elite realize this
before the National Convention is the interesting question. In these situations, where the individuals
are committed to their positions in more than one dimension, the evidence
usually does not suffice to change people’s minds.</span></span></div>
<div class="MsoNormal">
<br /></div>
<span style="font-size: small;">
</span><br />
<div class="MsoNormal">
<span style="font-size: small;"><span style="line-height: 107%;">But here’s
my campaign literature. All of it: (2 copies a sheet, which I cut in half.)</span></span></div>
<span style="font-size: small;">
</span><br />
<div class="MsoNormal">
<span style="font-size: small;"><span style="line-height: 107%;">______________________________________</span></span></div>
<span style="font-size: small;">
</span><br />
<div class="MsoNormal">
<span style="font-size: small;"><span style="line-height: 107%;">(SIDE 1:) Any
delegate we elect will bring Bernie his vote.
Go Bernie. But Bernie needs more.
Bernie’s opponents have attacked the cost and practicality of <i>all</i> of his positions, and this has
weakened his appeal and his campaign. Just a vote at the convention will not be
enough. Bernie needs more. Bernie needs someone who can show him how to
solidify his positions and broaden his appeal. And help him turn the votes of
Superdelegates at the convention.</span></span></div>
<div class="MsoNormal">
<br /></div>
<span style="font-size: small;">
</span><br />
<div class="MsoNormal">
<span style="font-size: small;"><span style="line-height: 107%;">Bernie’s
plan for single payer health care is attacked as too costly. Organizations like
the AMA and monopolists like Big Pharma have restricted the supply of
healthcare services, and now American healthcare is simply inadequate to
provide services for everyone. This is
what is driving up the price, and Bernie needs to address this by attacking
these organizations and providing mechanisms for increasing the supplies of
doctors, nurses, and the other things American healthcare needs.</span></span></div>
<div class="MsoNormal">
<br /></div>
<span style="font-size: small;">
</span><br />
<div class="MsoNormal">
<span style="font-size: small;"><span style="line-height: 107%;">To assure
justice for all, and in particular the poor and minorities, Bernie, as President, can bring suit against local
jurisdictions for their inadequate funding of their public defender’s offices.
There should be about as much money for
the public defenders as for the prosecutor’s offices in each jurisdiction. Right now the whole justice system is just a
scheme to keep our prisons filled, and with a disproportionate number of
minorities. If Bernie advocates for adequate funding for public defenders, it
WILL be revolutionary.</span></span></div>
<span style="font-size: small;">
</span><br />
<div class="MsoNormal">
<span style="font-size: small;"><span style="line-height: 107%;">I haven’t
been able to reach Bernie. If I am a
delegate, it will increase my chances of being able to talk to Bernie, and, if
I can, and Bernie wants it, I will be able to help him, his campaign, and the
people. No other delegate you could
elect would be able to do this. Elect me
to be your delegate. …Help Bernie!</span></span></div>
<span style="font-size: small;">
</span><br />
<div class="MsoNormal">
<span style="font-size: small;"><span style="line-height: 107%;">________________________</span></span></div>
<span style="font-size: small;">
</span><br />
<div class="MsoNormal">
<span style="font-size: small;"><span style="line-height: 107%;">(SIDE
2:) Capitalism rewards efficiency and
punishes resiliency. Capitalists seek to
maximize their profits, and will do so even if it harms society. Capitalists seek to maximize the consumption
of resources, so they may maximize the profit they can take. They do not, and in fact cannot, take the
long view. Society, however, is interested in lasting as long as possible, and
thus seeks to maintain the flow of resources at a sustainable rate. When capitalists take control of government,
society is no longer able to do reduce and maintain the flow of resources to a
sustainable rate, and the future is consumed at an ever accelerating rate. The interests of capitalists are not the
same as society’s, and never were.
Bernie opposes the TPP, and has always opposed free trade. Economists believe so much in free trade that
they ridicule Bernie’s position, and right now Bernie does not have the
arguments to fight back. There are two
arguments, however, which economists cannot answer. The first is that under a trade deficit, the
losses to producers are greater than the gains to consumers. The second is that because all taxation is a
tax on production, if a government does not tax all sources of production,
production will migrate to those sources government does not tax. This is because any producer the government
does not tax will have an advantage over a producer the government does tax. The government cannot tax foreign
producers. It can only put a tariff on
imports. If it does not do this, all domestic producers will eventually go
overseas, and the government will then not be able to tax any of them. </span></span></div>
<div class="MsoNormal">
<br /></div>
<span style="font-size: small;">
</span><br />
<div class="MsoNormal">
<span style="font-size: small;"><span style="line-height: 107%;">Ask me about
college tuition. Ask me about CEO pay.
Ask me about the police. Ask me
about climate change. Ask me about the
tax system. Ask me about government and
society. </span></span></div>
<div class="MsoNormal">
<span style="font-size: small;"><span style="line-height: 107%;"> </span></span></div>
<span style="font-size: small;">
</span><br />
<div class="MsoNormal">
<span style="font-size: small;"><span style="line-height: 107%;">Donald
Trump, who is a member of the establishment, has become the anti-establishment
candidate. Hillary has become the establishment candidate. Should the economy go South, as it is likely
to do, Hillary will take the blame, and the Democrats will be crushed in the
election. The Republicans, and their
wealthy sponsors, who are the actual establishment and ones actually responsible
and who should take the blame, will be absolved. The government will be largely dismantled, as
will the rights guaranteed by that government.
These are the rights that protect us from the depredations of the wealthy,
rights which the Republicans are already steadily taking apart. The economic consequences of this will be
terrible, even for the wealthy, because the people are the foundation of all
wealth, and without the people there is none.
Even if Hillary is elected, the depredations by the establishment of the
people will continue, and worsen, also to the point the of eventual economic
and political destruction of the United States. That is why I am for Bernie Sanders. Only Bernie is truly opposed to the
establishment policies, which are looting and destroying our country, and all
our futures. </span>We must do what we
can. ….
</span></div>
<span style="font-size: small;">
</span><br />
<div class="MsoNormal">
<span style="font-size: small;"><span style="line-height: 107%;">__________________________</span></span></div>
<span style="font-size: small;">
</span><br />
<div class="MsoNormal">
<span style="font-size: small;"><span style="line-height: 107%;">The ellipses
are where I put my name. Only one person
asked me about anything, and that was about energy. Since
I was put off by what happened, (although encouraged by the fact that so many
were participating, even if the exercise was, ah, irrelevant to the <i>real
</i>nomination process. That was a fact they did not
know.) I gave the larger picture some
thought, and, I think, gained insight.
Altogether, a worthwhile adventure. </span></span></div>
greghttp://www.blogger.com/profile/08201906679062960215noreply@blogger.com3tag:blogger.com,1999:blog-2957498637105757084.post-12092815160200029752016-05-29T00:58:00.000-04:002016-05-29T00:58:53.766-04:00Taxation, the States, and Trade<!--[if gte mso 9]><xml>
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
Name="index 1"/>
<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
Name="index 9"/>
<w:LsdException Locked="false" Priority="39" SemiHidden="true"
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<w:LsdException Locked="false" Priority="39" SemiHidden="true"
UnhideWhenUsed="true" Name="toc 2"/>
<w:LsdException Locked="false" Priority="39" SemiHidden="true"
UnhideWhenUsed="true" Name="toc 3"/>
<w:LsdException Locked="false" Priority="39" SemiHidden="true"
UnhideWhenUsed="true" Name="toc 4"/>
<w:LsdException Locked="false" Priority="39" SemiHidden="true"
UnhideWhenUsed="true" Name="toc 5"/>
<w:LsdException Locked="false" Priority="39" SemiHidden="true"
UnhideWhenUsed="true" Name="toc 6"/>
<w:LsdException Locked="false" Priority="39" SemiHidden="true"
UnhideWhenUsed="true" Name="toc 7"/>
<w:LsdException Locked="false" Priority="39" SemiHidden="true"
UnhideWhenUsed="true" Name="toc 8"/>
<w:LsdException Locked="false" Priority="39" SemiHidden="true"
UnhideWhenUsed="true" Name="toc 9"/>
<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
Name="header"/>
<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" Priority="35" SemiHidden="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
Name="envelope address"/>
<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
Name="toa heading"/>
<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
Name="List"/>
<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" Priority="10" QFormat="true" Name="Title"/>
<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" Priority="0" SemiHidden="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" Priority="11" QFormat="true" Name="Subtitle"/>
<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" Priority="22" QFormat="true" Name="Strong"/>
<w:LsdException Locked="false" Priority="20" QFormat="true" Name="Emphasis"/>
<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
Name="HTML Preformatted"/>
<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
Name="Normal Table"/>
<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
Name="Table Columns 1"/>
<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
Name="Table Columns 3"/>
<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" Priority="39" Name="Table Grid"/>
<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
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<w:LsdException Locked="false" SemiHidden="true" Name="Placeholder Text"/>
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<w:LsdException Locked="false" Priority="60" Name="Light Shading"/>
<w:LsdException Locked="false" Priority="61" Name="Light List"/>
<w:LsdException Locked="false" Priority="62" Name="Light Grid"/>
<w:LsdException Locked="false" Priority="63" Name="Medium Shading 1"/>
<w:LsdException Locked="false" Priority="64" Name="Medium Shading 2"/>
<w:LsdException Locked="false" Priority="65" Name="Medium List 1"/>
<w:LsdException Locked="false" Priority="66" Name="Medium List 2"/>
<w:LsdException Locked="false" Priority="67" Name="Medium Grid 1"/>
<w:LsdException Locked="false" Priority="68" Name="Medium Grid 2"/>
<w:LsdException Locked="false" Priority="69" Name="Medium Grid 3"/>
<w:LsdException Locked="false" Priority="70" Name="Dark List"/>
<w:LsdException Locked="false" Priority="71" Name="Colorful Shading"/>
<w:LsdException Locked="false" Priority="72" Name="Colorful List"/>
<w:LsdException Locked="false" Priority="73" Name="Colorful Grid"/>
<w:LsdException Locked="false" Priority="60" Name="Light Shading Accent 1"/>
<w:LsdException Locked="false" Priority="61" Name="Light List Accent 1"/>
<w:LsdException Locked="false" Priority="62" Name="Light Grid Accent 1"/>
<w:LsdException Locked="false" Priority="63" Name="Medium Shading 1 Accent 1"/>
<w:LsdException Locked="false" Priority="64" Name="Medium Shading 2 Accent 1"/>
<w:LsdException Locked="false" Priority="65" Name="Medium List 1 Accent 1"/>
<w:LsdException Locked="false" SemiHidden="true" Name="Revision"/>
<w:LsdException Locked="false" Priority="34" QFormat="true"
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<w:LsdException Locked="false" Priority="29" QFormat="true" Name="Quote"/>
<w:LsdException Locked="false" Priority="30" QFormat="true"
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<w:LsdException Locked="false" Priority="66" Name="Medium List 2 Accent 1"/>
<w:LsdException Locked="false" Priority="67" Name="Medium Grid 1 Accent 1"/>
<w:LsdException Locked="false" Priority="68" Name="Medium Grid 2 Accent 1"/>
<w:LsdException Locked="false" Priority="69" Name="Medium Grid 3 Accent 1"/>
<w:LsdException Locked="false" Priority="70" Name="Dark List Accent 1"/>
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<w:LsdException Locked="false" Priority="72" Name="Colorful List Accent 1"/>
<w:LsdException Locked="false" Priority="73" Name="Colorful Grid Accent 1"/>
<w:LsdException Locked="false" Priority="60" Name="Light Shading Accent 2"/>
<w:LsdException Locked="false" Priority="61" Name="Light List Accent 2"/>
<w:LsdException Locked="false" Priority="62" Name="Light Grid Accent 2"/>
<w:LsdException Locked="false" Priority="63" Name="Medium Shading 1 Accent 2"/>
<w:LsdException Locked="false" Priority="64" Name="Medium Shading 2 Accent 2"/>
<w:LsdException Locked="false" Priority="65" Name="Medium List 1 Accent 2"/>
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<w:LsdException Locked="false" Priority="67" Name="Medium Grid 1 Accent 2"/>
<w:LsdException Locked="false" Priority="68" Name="Medium Grid 2 Accent 2"/>
<w:LsdException Locked="false" Priority="69" Name="Medium Grid 3 Accent 2"/>
<w:LsdException Locked="false" Priority="70" Name="Dark List Accent 2"/>
<w:LsdException Locked="false" Priority="71" Name="Colorful Shading Accent 2"/>
<w:LsdException Locked="false" Priority="72" Name="Colorful List Accent 2"/>
<w:LsdException Locked="false" Priority="73" Name="Colorful Grid Accent 2"/>
<w:LsdException Locked="false" Priority="60" Name="Light Shading Accent 3"/>
<w:LsdException Locked="false" Priority="61" Name="Light List Accent 3"/>
<w:LsdException Locked="false" Priority="62" Name="Light Grid Accent 3"/>
<w:LsdException Locked="false" Priority="63" Name="Medium Shading 1 Accent 3"/>
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<w:LsdException Locked="false" Priority="69" Name="Medium Grid 3 Accent 3"/>
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<w:LsdException Locked="false" Priority="72" Name="Colorful List Accent 3"/>
<w:LsdException Locked="false" Priority="73" Name="Colorful Grid Accent 3"/>
<w:LsdException Locked="false" Priority="60" Name="Light Shading Accent 4"/>
<w:LsdException Locked="false" Priority="61" Name="Light List Accent 4"/>
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<w:LsdException Locked="false" Priority="63" Name="Medium Shading 1 Accent 4"/>
<w:LsdException Locked="false" Priority="64" Name="Medium Shading 2 Accent 4"/>
<w:LsdException Locked="false" Priority="65" Name="Medium List 1 Accent 4"/>
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<w:LsdException Locked="false" Priority="67" Name="Medium Grid 1 Accent 4"/>
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<w:LsdException Locked="false" Priority="69" Name="Medium Grid 3 Accent 4"/>
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<w:LsdException Locked="false" Priority="72" Name="Colorful List Accent 4"/>
<w:LsdException Locked="false" Priority="73" Name="Colorful Grid Accent 4"/>
<w:LsdException Locked="false" Priority="60" Name="Light Shading Accent 5"/>
<w:LsdException Locked="false" Priority="61" Name="Light List Accent 5"/>
<w:LsdException Locked="false" Priority="62" Name="Light Grid Accent 5"/>
<w:LsdException Locked="false" Priority="63" Name="Medium Shading 1 Accent 5"/>
<w:LsdException Locked="false" Priority="64" Name="Medium Shading 2 Accent 5"/>
<w:LsdException Locked="false" Priority="65" Name="Medium List 1 Accent 5"/>
<w:LsdException Locked="false" Priority="66" Name="Medium List 2 Accent 5"/>
<w:LsdException Locked="false" Priority="67" Name="Medium Grid 1 Accent 5"/>
<w:LsdException Locked="false" Priority="68" Name="Medium Grid 2 Accent 5"/>
<w:LsdException Locked="false" Priority="69" Name="Medium Grid 3 Accent 5"/>
<w:LsdException Locked="false" Priority="70" Name="Dark List Accent 5"/>
<w:LsdException Locked="false" Priority="71" Name="Colorful Shading Accent 5"/>
<w:LsdException Locked="false" Priority="72" Name="Colorful List Accent 5"/>
<w:LsdException Locked="false" Priority="73" Name="Colorful Grid Accent 5"/>
<w:LsdException Locked="false" Priority="60" Name="Light Shading Accent 6"/>
<w:LsdException Locked="false" Priority="61" Name="Light List Accent 6"/>
<w:LsdException Locked="false" Priority="62" Name="Light Grid Accent 6"/>
<w:LsdException Locked="false" Priority="63" Name="Medium Shading 1 Accent 6"/>
<w:LsdException Locked="false" Priority="64" Name="Medium Shading 2 Accent 6"/>
<w:LsdException Locked="false" Priority="65" Name="Medium List 1 Accent 6"/>
<w:LsdException Locked="false" Priority="66" Name="Medium List 2 Accent 6"/>
<w:LsdException Locked="false" Priority="67" Name="Medium Grid 1 Accent 6"/>
<w:LsdException Locked="false" Priority="68" Name="Medium Grid 2 Accent 6"/>
<w:LsdException Locked="false" Priority="69" Name="Medium Grid 3 Accent 6"/>
<w:LsdException Locked="false" Priority="70" Name="Dark List Accent 6"/>
<w:LsdException Locked="false" Priority="71" Name="Colorful Shading Accent 6"/>
<w:LsdException Locked="false" Priority="72" Name="Colorful List Accent 6"/>
<w:LsdException Locked="false" Priority="73" Name="Colorful Grid Accent 6"/>
<w:LsdException Locked="false" Priority="19" QFormat="true"
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<w:LsdException Locked="false" Priority="21" QFormat="true"
Name="Intense Emphasis"/>
<w:LsdException Locked="false" Priority="31" QFormat="true"
Name="Subtle Reference"/>
<w:LsdException Locked="false" Priority="32" QFormat="true"
Name="Intense Reference"/>
<w:LsdException Locked="false" Priority="33" QFormat="true" Name="Book Title"/>
<w:LsdException Locked="false" Priority="37" SemiHidden="true"
UnhideWhenUsed="true" Name="Bibliography"/>
<w:LsdException Locked="false" Priority="39" SemiHidden="true"
UnhideWhenUsed="true" QFormat="true" Name="TOC Heading"/>
<w:LsdException Locked="false" Priority="41" Name="Plain Table 1"/>
<w:LsdException Locked="false" Priority="42" Name="Plain Table 2"/>
<w:LsdException Locked="false" Priority="43" Name="Plain Table 3"/>
<w:LsdException Locked="false" Priority="44" Name="Plain Table 4"/>
<w:LsdException Locked="false" Priority="45" Name="Plain Table 5"/>
<w:LsdException Locked="false" Priority="40" Name="Grid Table Light"/>
<w:LsdException Locked="false" Priority="46" Name="Grid Table 1 Light"/>
<w:LsdException Locked="false" Priority="47" Name="Grid Table 2"/>
<w:LsdException Locked="false" Priority="48" Name="Grid Table 3"/>
<w:LsdException Locked="false" Priority="49" Name="Grid Table 4"/>
<w:LsdException Locked="false" Priority="50" Name="Grid Table 5 Dark"/>
<w:LsdException Locked="false" Priority="51" Name="Grid Table 6 Colorful"/>
<w:LsdException Locked="false" Priority="52" Name="Grid Table 7 Colorful"/>
<w:LsdException Locked="false" Priority="46"
Name="Grid Table 1 Light Accent 1"/>
<w:LsdException Locked="false" Priority="47" Name="Grid Table 2 Accent 1"/>
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<br /></div>
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The State of Connecticut, and other states, are having increasing difficulty
meeting the conflicting demands <span style="mso-spacerun: yes;"> </span>of a
declining tax base and increasing need for its services.<span style="mso-spacerun: yes;"> </span>Next year the state must cut over $1 Billion
of valuable and even critical services in order to balance its budget. </div>
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<br /></div>
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A recent article in Forbes ascribes the cause of the
deteriorating tax base to the imposition of a personal income tax 25 years ago.
(25 Years, $13 Billion Lost: Connecticut
Income Tax Continues To Fail)<span style="mso-spacerun: yes;"> *</span> </div>
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<br /></div>
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But let’s look at something else which could be a
cause:<span style="mso-spacerun: yes;"> </span>According to “State Smart,” ** the
state of Connecticut, in 2014, paid out <span style="mso-spacerun: yes;"> </span>$53 Billion dollars to the United States government
in taxes.<span style="mso-spacerun: yes;"> </span>However, that year, it only received
am estimated $45 billion in benefits from the federal government. Every year
the people of the Connecticut
give out to other states $8 billion. <span style="mso-spacerun: yes;"> </span>The
state and local share of that $8 Billion, (about 13%) works out to about $1
Billion in lost taxes.<span style="mso-spacerun: yes;"> </span>And that is just
one year. </div>
<div class="MsoNormal">
<br /></div>
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It is up to the state’s Congressional delegation to address
this problem, if they can.<span style="mso-spacerun: yes;"> </span>In the
meantime, the state is running the race with one foot in a bucket.<span style="mso-spacerun: yes;"> </span>While bad, this can be mitigated.<span style="mso-spacerun: yes;"> </span>The problem for the state, since it is easier
for rich people, and more generally for businesses and corporations, to move
than the working and the poor, is that the state is only allowed a regressive
tax system. Since Connecticut is stuck in the
shadow of pricey New York City,
it must also pay more for what it buys.<span style="mso-spacerun: yes;">
</span>These are not insurmountable problems.<span style="mso-spacerun: yes;">
</span>They mean, however, that the state must attract enough wealth generating
business activities that the tax load is not so burdensome upon the poor and
the working class that it cannot be mitigated by proper state expenditures. And
this means the state must have tax policies, and spending policies, and
regulatory policies, which are attractive to those kinds of business activities
which bring in money. </div>
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<br /></div>
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For instance, Corporations collect wealth from their many
operations, and the place they accumulate the most of this wealth is at their
headquarters. Other business activities which accumulate wealth are corporate offices
in general, laboratories and factories.<span style="mso-spacerun: yes;">
</span>All of these activities bring money into their communities, and into the
state.<span style="mso-spacerun: yes;"> </span></div>
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<br /></div>
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These are activities the state wishes to attract and encourage.<span style="mso-spacerun: yes;"> </span>While it cannot directly subsidize them, (Well,
nominally, it could,) <span style="mso-spacerun: yes;"> </span>it can capitalize
the infrastructure these businesses rely upon.<span style="mso-spacerun: yes;">
</span>Investing in roads and railroads, human capital, but perhaps even more
importantly efficient institutions and the resolving of conflicts, including
those inevitable conflicts businesses have with the state itself.<span style="mso-spacerun: yes;"> </span>This will reduce the many costs of doing
business in this or any state, and enhance the profit margins.<span style="mso-spacerun: yes;"> </span></div>
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<br /></div>
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For comparison, stores, in particular chain stores such as
Walmart, Home Depot, CVS, McDonalds, (and Amazon) and so forth, take money out
of communities, and out of the state.<span style="mso-spacerun: yes;">
</span>Walmart itself takes several billions of dollars out of the state of Connecticut each year, and sends those dollars off to Arkansas. Much of the
money which goes to the larger cable and telecommunications also leaves the
state. This loss of money the state can, with proper taxes, and by taking the
part of the communities and local store owners in their struggle with these
large retail chains, diminish.<span style="mso-spacerun: yes;"> </span></div>
<div class="MsoNormal">
<br /></div>
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There are other activities, which themselves do not generate
wealth, but merely rearrange the ownership of wealth.<span style="mso-spacerun: yes;"> </span>These may also be taxed.<span style="mso-spacerun: yes;"> </span>Some of these businesses, like real estate,
cannot leave.<span style="mso-spacerun: yes;"> </span>The others, since they do
not actually generate wealth, may be allowed to leave without penalty to the
state’s economy.<span style="mso-spacerun: yes;"> </span>These would include many
personal services of all kinds.<span style="mso-spacerun: yes;"> </span>Most of
these personal services are elective, and raising their costs would not affect
the well being of most people directly.<span style="mso-spacerun: yes;">
</span>Most especially, these taxes would not have a critical affect on the
well being of the poor.<span style="mso-spacerun: yes;"> </span>For those services
which were not elective, such as child care, the needs of the poor could be
supported.<span style="mso-spacerun: yes;"> </span>Indeed, for something like
child care, the state would in general have and interest in subsidizing it for
all possible clients, as this would form a more attractive workforce
environment and this would be something to attract businesses. </div>
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<br /></div>
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The state is in the business of allocating resources.<span style="mso-spacerun: yes;"> </span>Taxes take those resources from one use and
expenditures put them to another.<span style="mso-spacerun: yes;"> </span>In
many cases, this fulfills social needs that the market cannot fill.<span style="mso-spacerun: yes;"> </span>Quite simply, the market simply cannot supply
any particular thing or service to everybody.<span style="mso-spacerun: yes;">
</span>The laws of supply and demand guarantee that there will always be those
who cannot afford fuel, who cannot afford shelter, who cannot afford adequate
food, without intervention into the marketplace.<span style="mso-spacerun: yes;"> </span>Private intervention, that is, charity,
cannot suffice. For the charitable will find themselves at a competitive
disadvantage to the mean and selfish. </div>
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<br /></div>
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As the production of resources within the state declines,
the state must reach out to the production of other states, by attracting the
functions of businesses which accumulate the production from other states.<span style="mso-spacerun: yes;"> </span>And the state government must adopt policies which
attract those functions.<span style="mso-spacerun: yes;"> </span>It is only once
this income is spent by the corporations and businesses that the state
attracts, that the state can begin to collect taxes on it. And increasingly,
the state becomes unable to directly tax its own production.<span style="mso-spacerun: yes;"> </span>As due to increasing offshoring, domestic production
declines, (And without tariffs, taxes cannot be collected on production in
foreign countries,) competition for the remaining factories, other remaining
production facilities and the headquarters of domestic enterprises, the offices
and laboratories, will intensify. Only the intervention of the US government
can stop this spiral to the bottom.<span style="mso-spacerun: yes;"> </span>But
in the absence of such intervention, a state government which understands this
reality, and which is able to adapt to it will, for a time, prosper.</div>
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<br /></div>
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So only the actions of a government can assure that the
needs of all of society are met. A government which fails in this, will
eventually fail altogether, one piece at a time, as first the bottom, and then
each higher level of society falls below its ability to sustain itself.<span style="mso-spacerun: yes;"> </span>Only by capturing an adequate share of the
incomes of the very wealthy can the government succeed at this. But first it
must attract these incomes to itself. </div>
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<br /></div>
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<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
Name="List Continue"/>
<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
Name="List Continue 2"/>
<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
Name="List Continue 3"/>
<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
Name="List Continue 4"/>
<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
Name="List Continue 5"/>
<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
Name="Message Header"/>
<w:LsdException Locked="false" Priority="11" QFormat="true" Name="Subtitle"/>
<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
Name="Salutation"/>
<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
Name="Date"/>
<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
Name="Body Text First Indent"/>
<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
Name="Body Text First Indent 2"/>
<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
Name="Note Heading"/>
<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
Name="Body Text 2"/>
<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
Name="Body Text 3"/>
<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
Name="Body Text Indent 2"/>
<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
Name="Body Text Indent 3"/>
<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
Name="Block Text"/>
<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
Name="Hyperlink"/>
<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
Name="FollowedHyperlink"/>
<w:LsdException Locked="false" Priority="22" QFormat="true" Name="Strong"/>
<w:LsdException Locked="false" Priority="20" QFormat="true" Name="Emphasis"/>
<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
Name="Document Map"/>
<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
Name="Plain Text"/>
<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
Name="E-mail Signature"/>
<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
Name="HTML Top of Form"/>
<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
Name="HTML Bottom of Form"/>
<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
Name="Normal (Web)"/>
<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
Name="HTML Acronym"/>
<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
Name="HTML Address"/>
<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
Name="HTML Cite"/>
<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
Name="HTML Code"/>
<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
Name="HTML Definition"/>
<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
Name="HTML Keyboard"/>
<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
Name="HTML Preformatted"/>
<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
Name="HTML Sample"/>
<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
Name="HTML Typewriter"/>
<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
Name="HTML Variable"/>
<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
Name="Normal Table"/>
<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
Name="annotation subject"/>
<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
Name="No List"/>
<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
Name="Outline List 1"/>
<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
Name="Outline List 2"/>
<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
Name="Outline List 3"/>
<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
Name="Table Simple 1"/>
<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
Name="Table Simple 2"/>
<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
Name="Table Simple 3"/>
<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
Name="Table Classic 1"/>
<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
Name="Table Classic 2"/>
<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
Name="Table Classic 3"/>
<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
Name="Table Classic 4"/>
<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
Name="Table Colorful 1"/>
<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
Name="Table Colorful 2"/>
<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
Name="Table Colorful 3"/>
<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
Name="Table Columns 1"/>
<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
Name="Table Columns 2"/>
<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
Name="Table Columns 3"/>
<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
Name="Table Columns 4"/>
<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
Name="Table Columns 5"/>
<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
Name="Table Grid 1"/>
<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
Name="Table Grid 2"/>
<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
Name="Table Grid 3"/>
<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
Name="Table Grid 4"/>
<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
Name="Table Grid 5"/>
<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
Name="Table Grid 6"/>
<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
Name="Table Grid 7"/>
<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
Name="Table Grid 8"/>
<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
Name="Table List 1"/>
<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
Name="Table List 2"/>
<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
Name="Table List 3"/>
<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
Name="Table List 4"/>
<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
Name="Table List 5"/>
<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
Name="Table List 6"/>
<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
Name="Table List 7"/>
<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
Name="Table List 8"/>
<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
Name="Table 3D effects 1"/>
<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
Name="Table 3D effects 2"/>
<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
Name="Table 3D effects 3"/>
<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
Name="Table Contemporary"/>
<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
Name="Table Elegant"/>
<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
Name="Table Professional"/>
<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
Name="Table Subtle 1"/>
<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
Name="Table Subtle 2"/>
<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
Name="Table Web 1"/>
<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
Name="Table Web 2"/>
<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
Name="Table Web 3"/>
<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
Name="Balloon Text"/>
<w:LsdException Locked="false" Priority="39" Name="Table Grid"/>
<w:LsdException Locked="false" SemiHidden="true" UnhideWhenUsed="true"
Name="Table Theme"/>
<w:LsdException Locked="false" SemiHidden="true" Name="Placeholder Text"/>
<w:LsdException Locked="false" Priority="1" QFormat="true" Name="No Spacing"/>
<w:LsdException Locked="false" Priority="60" Name="Light Shading"/>
<w:LsdException Locked="false" Priority="61" Name="Light List"/>
<w:LsdException Locked="false" Priority="62" Name="Light Grid"/>
<w:LsdException Locked="false" Priority="63" Name="Medium Shading 1"/>
<w:LsdException Locked="false" Priority="64" Name="Medium Shading 2"/>
<w:LsdException Locked="false" Priority="65" Name="Medium List 1"/>
<w:LsdException Locked="false" Priority="66" Name="Medium List 2"/>
<w:LsdException Locked="false" Priority="67" Name="Medium Grid 1"/>
<w:LsdException Locked="false" Priority="68" Name="Medium Grid 2"/>
<w:LsdException Locked="false" Priority="69" Name="Medium Grid 3"/>
<w:LsdException Locked="false" Priority="70" Name="Dark List"/>
<w:LsdException Locked="false" Priority="71" Name="Colorful Shading"/>
<w:LsdException Locked="false" Priority="72" Name="Colorful List"/>
<w:LsdException Locked="false" Priority="73" Name="Colorful Grid"/>
<w:LsdException Locked="false" Priority="60" Name="Light Shading Accent 1"/>
<w:LsdException Locked="false" Priority="61" Name="Light List Accent 1"/>
<w:LsdException Locked="false" Priority="62" Name="Light Grid Accent 1"/>
<w:LsdException Locked="false" Priority="63" Name="Medium Shading 1 Accent 1"/>
<w:LsdException Locked="false" Priority="64" Name="Medium Shading 2 Accent 1"/>
<w:LsdException Locked="false" Priority="65" Name="Medium List 1 Accent 1"/>
<w:LsdException Locked="false" SemiHidden="true" Name="Revision"/>
<w:LsdException Locked="false" Priority="34" QFormat="true"
Name="List Paragraph"/>
<w:LsdException Locked="false" Priority="29" QFormat="true" Name="Quote"/>
<w:LsdException Locked="false" Priority="30" QFormat="true"
Name="Intense Quote"/>
<w:LsdException Locked="false" Priority="66" Name="Medium List 2 Accent 1"/>
<w:LsdException Locked="false" Priority="67" Name="Medium Grid 1 Accent 1"/>
<w:LsdException Locked="false" Priority="68" Name="Medium Grid 2 Accent 1"/>
<w:LsdException Locked="false" Priority="69" Name="Medium Grid 3 Accent 1"/>
<w:LsdException Locked="false" Priority="70" Name="Dark List Accent 1"/>
<w:LsdException Locked="false" Priority="71" Name="Colorful Shading Accent 1"/>
<w:LsdException Locked="false" Priority="72" Name="Colorful List Accent 1"/>
<w:LsdException Locked="false" Priority="73" Name="Colorful Grid Accent 1"/>
<w:LsdException Locked="false" Priority="60" Name="Light Shading Accent 2"/>
<w:LsdException Locked="false" Priority="61" Name="Light List Accent 2"/>
<w:LsdException Locked="false" Priority="62" Name="Light Grid Accent 2"/>
<w:LsdException Locked="false" Priority="63" Name="Medium Shading 1 Accent 2"/>
<w:LsdException Locked="false" Priority="64" Name="Medium Shading 2 Accent 2"/>
<w:LsdException Locked="false" Priority="65" Name="Medium List 1 Accent 2"/>
<w:LsdException Locked="false" Priority="66" Name="Medium List 2 Accent 2"/>
<w:LsdException Locked="false" Priority="67" Name="Medium Grid 1 Accent 2"/>
<w:LsdException Locked="false" Priority="68" Name="Medium Grid 2 Accent 2"/>
<w:LsdException Locked="false" Priority="69" Name="Medium Grid 3 Accent 2"/>
<w:LsdException Locked="false" Priority="70" Name="Dark List Accent 2"/>
<w:LsdException Locked="false" Priority="71" Name="Colorful Shading Accent 2"/>
<w:LsdException Locked="false" Priority="72" Name="Colorful List Accent 2"/>
<w:LsdException Locked="false" Priority="73" Name="Colorful Grid Accent 2"/>
<w:LsdException Locked="false" Priority="60" Name="Light Shading Accent 3"/>
<w:LsdException Locked="false" Priority="61" Name="Light List Accent 3"/>
<w:LsdException Locked="false" Priority="62" Name="Light Grid Accent 3"/>
<w:LsdException Locked="false" Priority="63" Name="Medium Shading 1 Accent 3"/>
<w:LsdException Locked="false" Priority="64" Name="Medium Shading 2 Accent 3"/>
<w:LsdException Locked="false" Priority="65" Name="Medium List 1 Accent 3"/>
<w:LsdException Locked="false" Priority="66" Name="Medium List 2 Accent 3"/>
<w:LsdException Locked="false" Priority="67" Name="Medium Grid 1 Accent 3"/>
<w:LsdException Locked="false" Priority="68" Name="Medium Grid 2 Accent 3"/>
<w:LsdException Locked="false" Priority="69" Name="Medium Grid 3 Accent 3"/>
<w:LsdException Locked="false" Priority="70" Name="Dark List Accent 3"/>
<w:LsdException Locked="false" Priority="71" Name="Colorful Shading Accent 3"/>
<w:LsdException Locked="false" Priority="72" Name="Colorful List Accent 3"/>
<w:LsdException Locked="false" Priority="73" Name="Colorful Grid Accent 3"/>
<w:LsdException Locked="false" Priority="60" Name="Light Shading Accent 4"/>
<w:LsdException Locked="false" Priority="61" Name="Light List Accent 4"/>
<w:LsdException Locked="false" Priority="62" Name="Light Grid Accent 4"/>
<w:LsdException Locked="false" Priority="63" Name="Medium Shading 1 Accent 4"/>
<w:LsdException Locked="false" Priority="64" Name="Medium Shading 2 Accent 4"/>
<w:LsdException Locked="false" Priority="65" Name="Medium List 1 Accent 4"/>
<w:LsdException Locked="false" Priority="66" Name="Medium List 2 Accent 4"/>
<w:LsdException Locked="false" Priority="67" Name="Medium Grid 1 Accent 4"/>
<w:LsdException Locked="false" Priority="68" Name="Medium Grid 2 Accent 4"/>
<w:LsdException Locked="false" Priority="69" Name="Medium Grid 3 Accent 4"/>
<w:LsdException Locked="false" Priority="70" Name="Dark List Accent 4"/>
<w:LsdException Locked="false" Priority="71" Name="Colorful Shading Accent 4"/>
<w:LsdException Locked="false" Priority="72" Name="Colorful List Accent 4"/>
<w:LsdException Locked="false" Priority="73" Name="Colorful Grid Accent 4"/>
<w:LsdException Locked="false" Priority="60" Name="Light Shading Accent 5"/>
<w:LsdException Locked="false" Priority="61" Name="Light List Accent 5"/>
<w:LsdException Locked="false" Priority="62" Name="Light Grid Accent 5"/>
<w:LsdException Locked="false" Priority="63" Name="Medium Shading 1 Accent 5"/>
<w:LsdException Locked="false" Priority="64" Name="Medium Shading 2 Accent 5"/>
<w:LsdException Locked="false" Priority="65" Name="Medium List 1 Accent 5"/>
<w:LsdException Locked="false" Priority="66" Name="Medium List 2 Accent 5"/>
<w:LsdException Locked="false" Priority="67" Name="Medium Grid 1 Accent 5"/>
<w:LsdException Locked="false" Priority="68" Name="Medium Grid 2 Accent 5"/>
<w:LsdException Locked="false" Priority="69" Name="Medium Grid 3 Accent 5"/>
<w:LsdException Locked="false" Priority="70" Name="Dark List Accent 5"/>
<w:LsdException Locked="false" Priority="71" Name="Colorful Shading Accent 5"/>
<w:LsdException Locked="false" Priority="72" Name="Colorful List Accent 5"/>
<w:LsdException Locked="false" Priority="73" Name="Colorful Grid Accent 5"/>
<w:LsdException Locked="false" Priority="60" Name="Light Shading Accent 6"/>
<w:LsdException Locked="false" Priority="61" Name="Light List Accent 6"/>
<w:LsdException Locked="false" Priority="62" Name="Light Grid Accent 6"/>
<w:LsdException Locked="false" Priority="63" Name="Medium Shading 1 Accent 6"/>
<w:LsdException Locked="false" Priority="64" Name="Medium Shading 2 Accent 6"/>
<w:LsdException Locked="false" Priority="65" Name="Medium List 1 Accent 6"/>
<w:LsdException Locked="false" Priority="66" Name="Medium List 2 Accent 6"/>
<w:LsdException Locked="false" Priority="67" Name="Medium Grid 1 Accent 6"/>
<w:LsdException Locked="false" Priority="68" Name="Medium Grid 2 Accent 6"/>
<w:LsdException Locked="false" Priority="69" Name="Medium Grid 3 Accent 6"/>
<w:LsdException Locked="false" Priority="70" Name="Dark List Accent 6"/>
<w:LsdException Locked="false" Priority="71" Name="Colorful Shading Accent 6"/>
<w:LsdException Locked="false" Priority="72" Name="Colorful List Accent 6"/>
<w:LsdException Locked="false" Priority="73" Name="Colorful Grid Accent 6"/>
<w:LsdException Locked="false" Priority="19" QFormat="true"
Name="Subtle Emphasis"/>
<w:LsdException Locked="false" Priority="21" QFormat="true"
Name="Intense Emphasis"/>
<w:LsdException Locked="false" Priority="31" QFormat="true"
Name="Subtle Reference"/>
<w:LsdException Locked="false" Priority="32" QFormat="true"
Name="Intense Reference"/>
<w:LsdException Locked="false" Priority="33" QFormat="true" Name="Book Title"/>
<w:LsdException Locked="false" Priority="37" SemiHidden="true"
UnhideWhenUsed="true" Name="Bibliography"/>
<w:LsdException Locked="false" Priority="39" SemiHidden="true"
UnhideWhenUsed="true" QFormat="true" Name="TOC Heading"/>
<w:LsdException Locked="false" Priority="41" Name="Plain Table 1"/>
<w:LsdException Locked="false" Priority="42" Name="Plain Table 2"/>
<w:LsdException Locked="false" Priority="43" Name="Plain Table 3"/>
<w:LsdException Locked="false" Priority="44" Name="Plain Table 4"/>
<w:LsdException Locked="false" Priority="45" Name="Plain Table 5"/>
<w:LsdException Locked="false" Priority="40" Name="Grid Table Light"/>
<w:LsdException Locked="false" Priority="46" Name="Grid Table 1 Light"/>
<w:LsdException Locked="false" Priority="47" Name="Grid Table 2"/>
<w:LsdException Locked="false" Priority="48" Name="Grid Table 3"/>
<w:LsdException Locked="false" Priority="49" Name="Grid Table 4"/>
<w:LsdException Locked="false" Priority="50" Name="Grid Table 5 Dark"/>
<w:LsdException Locked="false" Priority="51" Name="Grid Table 6 Colorful"/>
<w:LsdException Locked="false" Priority="52" Name="Grid Table 7 Colorful"/>
<w:LsdException Locked="false" Priority="46"
Name="Grid Table 1 Light Accent 1"/>
<w:LsdException Locked="false" Priority="47" Name="Grid Table 2 Accent 1"/>
<w:LsdException Locked="false" Priority="48" Name="Grid Table 3 Accent 1"/>
<w:LsdException Locked="false" Priority="49" Name="Grid Table 4 Accent 1"/>
<w:LsdException Locked="false" Priority="50" Name="Grid Table 5 Dark Accent 1"/>
<w:LsdException Locked="false" Priority="51"
Name="Grid Table 6 Colorful Accent 1"/>
<w:LsdException Locked="false" Priority="52"
Name="Grid Table 7 Colorful Accent 1"/>
<w:LsdException Locked="false" Priority="46"
Name="Grid Table 1 Light Accent 2"/>
<w:LsdException Locked="false" Priority="47" Name="Grid Table 2 Accent 2"/>
<w:LsdException Locked="false" Priority="48" Name="Grid Table 3 Accent 2"/>
<w:LsdException Locked="false" Priority="49" Name="Grid Table 4 Accent 2"/>
<w:LsdException Locked="false" Priority="50" Name="Grid Table 5 Dark Accent 2"/>
<w:LsdException Locked="false" Priority="51"
Name="Grid Table 6 Colorful Accent 2"/>
<w:LsdException Locked="false" Priority="52"
Name="Grid Table 7 Colorful Accent 2"/>
<w:LsdException Locked="false" Priority="46"
Name="Grid Table 1 Light Accent 3"/>
<w:LsdException Locked="false" Priority="47" Name="Grid Table 2 Accent 3"/>
<w:LsdException Locked="false" Priority="48" Name="Grid Table 3 Accent 3"/>
<w:LsdException Locked="false" Priority="49" Name="Grid Table 4 Accent 3"/>
<w:LsdException Locked="false" Priority="50" Name="Grid Table 5 Dark Accent 3"/>
<w:LsdException Locked="false" Priority="51"
Name="Grid Table 6 Colorful Accent 3"/>
<w:LsdException Locked="false" Priority="52"
Name="Grid Table 7 Colorful Accent 3"/>
<w:LsdException Locked="false" Priority="46"
Name="Grid Table 1 Light Accent 4"/>
<w:LsdException Locked="false" Priority="47" Name="Grid Table 2 Accent 4"/>
<w:LsdException Locked="false" Priority="48" Name="Grid Table 3 Accent 4"/>
<w:LsdException Locked="false" Priority="49" Name="Grid Table 4 Accent 4"/>
<w:LsdException Locked="false" Priority="50" Name="Grid Table 5 Dark Accent 4"/>
<w:LsdException Locked="false" Priority="51"
Name="Grid Table 6 Colorful Accent 4"/>
<w:LsdException Locked="false" Priority="52"
Name="Grid Table 7 Colorful Accent 4"/>
<w:LsdException Locked="false" Priority="46"
Name="Grid Table 1 Light Accent 5"/>
<w:LsdException Locked="false" Priority="47" Name="Grid Table 2 Accent 5"/>
<w:LsdException Locked="false" Priority="48" Name="Grid Table 3 Accent 5"/>
<w:LsdException Locked="false" Priority="49" Name="Grid Table 4 Accent 5"/>
<w:LsdException Locked="false" Priority="50" Name="Grid Table 5 Dark Accent 5"/>
<w:LsdException Locked="false" Priority="51"
Name="Grid Table 6 Colorful Accent 5"/>
<w:LsdException Locked="false" Priority="52"
Name="Grid Table 7 Colorful Accent 5"/>
<w:LsdException Locked="false" Priority="46"
Name="Grid Table 1 Light Accent 6"/>
<w:LsdException Locked="false" Priority="47" Name="Grid Table 2 Accent 6"/>
<w:LsdException Locked="false" Priority="48" Name="Grid Table 3 Accent 6"/>
<w:LsdException Locked="false" Priority="49" Name="Grid Table 4 Accent 6"/>
<w:LsdException Locked="false" Priority="50" Name="Grid Table 5 Dark Accent 6"/>
<w:LsdException Locked="false" Priority="51"
Name="Grid Table 6 Colorful Accent 6"/>
<w:LsdException Locked="false" Priority="52"
Name="Grid Table 7 Colorful Accent 6"/>
<w:LsdException Locked="false" Priority="46" Name="List Table 1 Light"/>
<w:LsdException Locked="false" Priority="47" Name="List Table 2"/>
<w:LsdException Locked="false" Priority="48" Name="List Table 3"/>
<w:LsdException Locked="false" Priority="49" Name="List Table 4"/>
<w:LsdException Locked="false" Priority="50" Name="List Table 5 Dark"/>
<w:LsdException Locked="false" Priority="51" Name="List Table 6 Colorful"/>
<w:LsdException Locked="false" Priority="52" Name="List Table 7 Colorful"/>
<w:LsdException Locked="false" Priority="46"
Name="List Table 1 Light Accent 1"/>
<w:LsdException Locked="false" Priority="47" Name="List Table 2 Accent 1"/>
<w:LsdException Locked="false" Priority="48" Name="List Table 3 Accent 1"/>
<w:LsdException Locked="false" Priority="49" Name="List Table 4 Accent 1"/>
<w:LsdException Locked="false" Priority="50" Name="List Table 5 Dark Accent 1"/>
<w:LsdException Locked="false" Priority="51"
Name="List Table 6 Colorful Accent 1"/>
<w:LsdException Locked="false" Priority="52"
Name="List Table 7 Colorful Accent 1"/>
<w:LsdException Locked="false" Priority="46"
Name="List Table 1 Light Accent 2"/>
<w:LsdException Locked="false" Priority="47" Name="List Table 2 Accent 2"/>
<w:LsdException Locked="false" Priority="48" Name="List Table 3 Accent 2"/>
<w:LsdException Locked="false" Priority="49" Name="List Table 4 Accent 2"/>
<w:LsdException Locked="false" Priority="50" Name="List Table 5 Dark Accent 2"/>
<w:LsdException Locked="false" Priority="51"
Name="List Table 6 Colorful Accent 2"/>
<w:LsdException Locked="false" Priority="52"
Name="List Table 7 Colorful Accent 2"/>
<w:LsdException Locked="false" Priority="46"
Name="List Table 1 Light Accent 3"/>
<w:LsdException Locked="false" Priority="47" Name="List Table 2 Accent 3"/>
<w:LsdException Locked="false" Priority="48" Name="List Table 3 Accent 3"/>
<w:LsdException Locked="false" Priority="49" Name="List Table 4 Accent 3"/>
<w:LsdException Locked="false" Priority="50" Name="List Table 5 Dark Accent 3"/>
<w:LsdException Locked="false" Priority="51"
Name="List Table 6 Colorful Accent 3"/>
<w:LsdException Locked="false" Priority="52"
Name="List Table 7 Colorful Accent 3"/>
<w:LsdException Locked="false" Priority="46"
Name="List Table 1 Light Accent 4"/>
<w:LsdException Locked="false" Priority="47" Name="List Table 2 Accent 4"/>
<w:LsdException Locked="false" Priority="48" Name="List Table 3 Accent 4"/>
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<div class="MsoNormal">
Since all taxation is against production, the government
must capture all productive streams, in order to extract necessary income. Any streams it does not capture will be
more competitive than those which must bear the additional cost of
taxation.<span style="mso-spacerun: yes;"> </span>When an economy runs a trade deficit,
it must also tax foreign production, since otherwise domestic production will be
uncompetitive with foreign production, and domestic production will be
replaced, and government revenues decline. </div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Non-productive activities must also be taxed. Otherwise,
economic activity will preferentially go to non-productive activities, since
these will have the greater nominal profits.<span style="mso-spacerun: yes;">
</span>In particular, the non-productive activities of the wealthy must be
taxed, to prevent decapitalization of the economy.</div>
<br />
<br />
<div class="MsoNormal">
_____________________________________ </div>
<div class="MsoNormal">
* <span style="mso-spacerun: yes;"></span><a href="http://www.forbes.com/sites/rexsinquefield/2016/05/23/25-years-13-billion-lost-connecticut-income-tax-continues-to-fail/#589c29771b80">http://www.forbes.com/sites/rexsinquefield/2016/05/23/25-years-13-billion-lost-connecticut-income-tax-continues-to-fail/#589c29771b80</a><span style="mso-spacerun: yes;"> </span>(and others)</div>
<br />
<div class="MsoNormal">
</div>
<br />
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
**<a href="https://www.nationalpriorities.org/smart/connecticut/">https://www.nationalpriorities.org/smart/connecticut/</a></div>
<br />greghttp://www.blogger.com/profile/08201906679062960215noreply@blogger.com0tag:blogger.com,1999:blog-2957498637105757084.post-716695115754950602016-04-25T02:41:00.000-04:002016-04-25T02:42:27.609-04:00The Democratic Party is really not very Democratic <!--[if gte mso 9]><xml>
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<br />
<div class="MsoNormal">
The Democratic Party is really not very Democratic </div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Hey!<span style="mso-spacerun: yes;"> </span>All you Democrats
out there! The Democratic Party is really not very Democratic. Consider first
the “Superdelegates.”<span style="mso-spacerun: yes;"> </span>Not only does the
Democratic electorate have no say in who they are but it has no say even about how
many “Superdelegates” are designated by the Democratic National Committee,. Not
only is the voting process at the Democratic National Convention weighted by
the so called "Superdelegates," but the Democratic National Committee
is itself weighted by the inclusion of elected government officials and party
functionaries.<span style="mso-spacerun: yes;"> </span>The executive committee
of the party is even more so. You have to check the bylaws for the prescribed
composition.</div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Anyway, Article Two, Section 4 of the Charter describes the
procedures by which ‘ordinary’ delegates are chosen, and subsection (e) seems
to exclude the creation of a significant block of delegates who were selected
without the “participation in good faith of all voters…”<span style="mso-spacerun: yes;"> </span>BUT:<span style="mso-spacerun: yes;">
</span>Article Two, Section 5 throws democratic processes out the window.<span style="mso-spacerun: yes;"> </span>While the number of elected delegates is
limited by the charter, the number of delegates which can be ‘designated’ by
the Committee is not.<span style="mso-spacerun: yes;"> </span>Basically, Section
5 allows the appointment of any number of delegates by the Democratic National
Committee, and if there are a mere 700 or so of them, it is because the
National Committee has exercised some restraint.<span style="mso-spacerun: yes;"> </span>That is by my reading.<span style="mso-spacerun: yes;"> </span>For your convenience, I provide Section 5, so
you may interpret, and decide, for your self.</div>
<div class="MsoNormal">
_____________________________________</div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
<b style="mso-bidi-font-weight: normal;"><u>THE CHARTER OF THE
DEMOCRATIC PARTY OF THE UNITED STATES</u></b></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
<b style="mso-bidi-font-weight: normal;">ARTICLE TWO, SECTION
5:</b> The delegate vote allocable to each state shall be determined as
provided in the Bylaws, consistent with the formula:</div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
a. giving equal weight to population, which may be measured
by electoral vote, and to the Democratic vote in elections for office of the
President; and</div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
b. giving such additional delegate votes as may be
specifically designated by the Democratic National Committee in the Call to the
Convention, subject to such conditions as may be set forth by the Democratic
National Committee in said Call, for the purpose of providing incentives for
scheduling the event constituting the first determining stage in the
presidential nominating process in each state later in the year of the
Convention than such event would otherwise be scheduled in the absence of such
incentive; and</div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
c. which shall also provide additional delegate positions to
members of the Democratic National Committee; and</div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
d. which may also provide additional delegate positions to
Democratic elected public officials specifically designated by the Democratic
National Committee in the Call to the Convention, subject to the provisions of
Section 4.</div>
<div class="MsoNormal">
______________________________________</div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Subsection <b style="mso-bidi-font-weight: normal;">a:</b> is
the sop to democratic process. The rest of the Article is the work around.<b style="mso-bidi-font-weight: normal;"> The Charter and Bylaws of the Democratic
Party</b> and <b style="mso-bidi-font-weight: normal;">The Rules of the
Republican Party</b>, can be Googled, and any participant in our political
processes should.</div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
In a way, it is not in the interests for those members who
are elected or appointed government officials for the Democratic party to
actually be successful.<span style="mso-spacerun: yes;"> </span>The greater the
success of the Democratic party, the greater the competition for positions on
the National and Executive committees. <span style="mso-spacerun: yes;"> </span></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
For comparison, I have also checked out <span style="mso-spacerun: yes;"> </span><b style="mso-bidi-font-weight: normal;">The
Rules of the Republican Party.<span style="mso-spacerun: yes;"> </span>T</b>he
Republican document seems to be more procedural, and the<b style="mso-bidi-font-weight: normal;"> </b>Democratic Charter more purpose driven.<b style="mso-bidi-font-weight: normal;"> </b><span style="mso-spacerun: yes;"> </span><span style="mso-spacerun: yes;"> </span>The irony is that, (At least as far as I can
tell.<span style="mso-spacerun: yes;"> </span>The comparison is not easy.<span style="mso-spacerun: yes;"> </span>Both documents seem to me to be unnecessarily
obscure.) under their Rules Republicans are more democratically represented by
their party officers than the Democrats under The Charter are by theirs.<span style="mso-spacerun: yes;"> </span>The Democratic Party structure is rigged in a
way which caters to the establishment and is contrary to democratic principles.<span style="mso-spacerun: yes;"> </span>The Republican Party structure under its
rules, anyway, is not.</div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
The Democratic Charter seems to go back to 1972. (This is from the revision of 2012.) So there
has been plenty of time for the appropriate people to notice this and bring it
to the attention of the party membership.<span style="mso-spacerun: yes;"> </span></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
A note of small humorousness:<span style="mso-spacerun: yes;"> </span>The Republicans have no mention of God in
their preamble, nor of the Constitution.<span style="mso-spacerun: yes;">
</span>The Democrats mention both.</div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
One other important question:<span style="mso-spacerun: yes;"> </span>Why is the government at all involved in the
primaries?<span style="mso-spacerun: yes;"> </span>No one is elected to any
government office, so why is it the government that is concerned with fairness
or procedure.<span style="mso-spacerun: yes;"> </span>It is the concern of each
of the various parties, to assure fairness, in <i style="mso-bidi-font-style: normal;">their</i> election.<span style="mso-spacerun: yes;"> </span>(Or
not.<span style="mso-spacerun: yes;"> </span>The officers of the party may
believe that an unfair nominating process will not compromise, and may enhance,
the electability of their party's candidates in the general election.) <span style="mso-spacerun: yes;"> </span>The members of the various parties elect
candidates they hope are both electable, and perhaps equally important,
represent the interests and desires of a majority of that party's members.</div>
<div class="MsoNormal">
<span style="mso-spacerun: yes;"> </span></div>
<div class="MsoNormal">
As things stand, one party must overcome the opposition of
the other party to follow the procedures it considers favorable to itself, and
the other party must follow the procedures laid down by the opposition party,
whether or not those are the procedures desired by its electorate.<span style="mso-spacerun: yes;"> </span></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
These interests of the party electorate are not necessarily
the same as the interests of the government, in particular the interests of the establishment
politicians of the various states.<span style="mso-spacerun: yes;"> </span>Where
they diverge, the government may be expected to interfere and impose conditions
which harm the interests of the electorate.<span style="mso-spacerun: yes;">
</span>Where the government imposes procedures, the government must be expected
to impose procedures which distort the primary process to favor its interests,
rather than the party's. <span style="mso-spacerun: yes;"> </span>Granted, the
party’s interests are not necessarily coherent.<span style="mso-spacerun: yes;">
</span>The party elite’s interests are not necessarily the interests of the
party voters or the rank and file, as they may expected to align more with the
government’s interests.<span style="mso-spacerun: yes;"> </span>Indeed, since one
or another party<i style="mso-bidi-font-style: normal;"> is </i>the government<span style="mso-spacerun: yes;"> </span>only if the government is disinterestedly and
competently serving what the voters desire. <span style="mso-spacerun: yes;"> </span>Simply, it is the job of each party to run
their own elections.<span style="mso-spacerun: yes;"> </span>It is not the
government's job. </div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
In fact, it is in the interests of each party to establish
those rules and procedures which that party considers the best able to attain
the goal of nominating the candidates who best most likely to win in the general
election, while taking those positions the majority of the voters of that party
desire. <span style="mso-spacerun: yes;"> </span>Failure to do so would
disadvantage not only the particular party in the general election, but
compromise the ability of the government to<span style="mso-spacerun: yes;">
</span>properly respond to the needs and desires of their electorate. <span style="mso-spacerun: yes;"> </span>It would thus <span style="mso-spacerun: yes;"> </span>compromise their ability to govern.<span style="mso-spacerun: yes;"> </span>Democracy is the best system while it is the
most responsive to the electorate. <span style="mso-spacerun: yes;"> </span>When
it fails to do this, when it corrupts the process or violates the principles of
impartial access to information by the electorate, it is no longer. <span style="mso-spacerun: yes;"> </span></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Now, as it is, the government does subsidize the primaries
by providing and servicing the polling places and vote counting and so forth. <span style="mso-spacerun: yes;"> </span>But as we have seen in places like Arizona, the government
need not always provide these services fairly and in the desired quantity. <span style="mso-spacerun: yes;"> </span>So the government could provide the necessary services while
allowing the various parties to form and follow their own policies and procedures.<span style="mso-spacerun: yes;"> </span><span style="mso-spacerun: yes;"> </span>Provisions
could be made to accommodate the minor parties. <span style="mso-spacerun: yes;"> </span></div>
greghttp://www.blogger.com/profile/08201906679062960215noreply@blogger.com0tag:blogger.com,1999:blog-2957498637105757084.post-52435290759130130292016-02-29T23:30:00.000-05:002016-04-25T02:43:01.999-04:00Disarming Terrorists<!--[if gte mso 9]><xml>
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<br />
<div class="MsoNormal">
Recently, a nearby community college proposed arming its
guards.<span style="mso-spacerun: yes;"> </span>Let’s suppose it wasn’t just to
protect against ISIS, but against the locally
grown dangerous and the locally grown insane. <span style="mso-spacerun: yes;"> </span>One could claim that there is cause, since a
few years ago a young individual brought an assault rifle into a neighboring
elementary school and killed 20 small children and <span style="mso-spacerun: yes;"> </span>6 adults.<span style="mso-spacerun: yes;">
</span></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
While arming the guards may perhaps make the students at the
particular college safer, while they are at the college, it does not address
the broader problem:<span style="mso-spacerun: yes;"> </span>How to keep society
safe, given the wide availability of weapons capable, from use by someone so
motivated, of killing a fair number of people very quickly. But if we make that
particular college safe, what of other colleges?<span style="mso-spacerun: yes;"> </span>If we make the colleges safe, what of other
schools?<span style="mso-spacerun: yes;"> </span>If we make the schools safe
what of the plazas, and the stores, and the factories and the hospitals, and
the homes?<span style="mso-spacerun: yes;"> </span>What of the water supplies
and power grids?</div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
It is clear that what ever we protect, what ever we do not
protect will become the target.<span style="mso-spacerun: yes;"> </span>And so
we must protect it all.<span style="mso-spacerun: yes;"> </span>The material
cost would be stupendous, not just in capitalization, but in maintenance.<span style="mso-spacerun: yes;"> </span>We cannot pay sufficient guards, so citizens
must go armed.<span style="mso-spacerun: yes;"> </span>And then how to tell, who
among the myriad of armed citizens, is not a terrorist, armed and on his way to
destruction. <span style="mso-spacerun: yes;"> </span>Further, even if armed, how
can the citizens be protected against suicide bombers.<span style="mso-spacerun: yes;"> </span>Explosive fireworks, albeit of limited
gunpowder content, are available in 26 states.<span style="mso-spacerun: yes;">
</span>Will potential terrorists find these limitations to be
insurmountable?<span style="mso-spacerun: yes;"> </span></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
The fact is, we cannot prevent any terrorist, of either
foreign or domestic origin, once sufficiently determined, from inflicting
damage on our society or our infrastructure.<span style="mso-spacerun: yes;">
</span></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
What can be done is minimizing the strength and power of the
motivations behind the terrorist and his acts. </div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Two things must be done.<span style="mso-spacerun: yes;">
</span>The first is to stop inflicting violence. <span style="mso-spacerun: yes;"> </span>The second is to excite admiration, rather
than to incite envy.</div>
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<![endif]-->greghttp://www.blogger.com/profile/08201906679062960215noreply@blogger.com4