Category Archives: Commentary

Commentary

Did George W. Bush’s tax cuts help or hurt the economy?

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From Investor’s Business Daily.

Excerpt:

Data from the end of 2001 to the latest recession bear this out. The economy started expanding again in the fourth quarter of 2001 and grew for 25 consecutive quarters. After enactment of the 2003 tax cut, which lowered the marginal effective tax rate on new investment, gross domestic product surged 7.5% in the third quarter, the fastest pace since 1984. And for 26 straight months unemployment stayed below 5%.

The Bush tax cuts also led to increases in tax revenues, and after 2004 the revenues grew faster than the economy. The ratio of tax receipts to GDP rose to 18.8% in 2007, above the 40-year average, and the deficit was just 1.2% of GDP.

From 2004 to 2008, capital gains realizations grew by 60%; from 2004 to 2007, corporate tax receipts nearly doubled, adding a full point to the revenues-to-GDP ratio.

The Heritage Foundation reported on research by two Harvard economists who published a research paper on this very topic.

Excerpt:

…government spending cannot create economic growth. More government spending, whether financed by taxes or borrowing, only takes money from one sector of the economy and transfers it to another. The government creates no new spending power when it redistributes money so it creates no new economic growth.

As the Heritage Foundation has pointed out, a stimulus package that lowered marginal tax rates instead of spending massive amounts of future generation’s wealth would actually create jobs and help pull the economy out of the Great Recession. That is because lower marginal tax rates would increase the incentives of people and businesses to work, save and invest – the very ingredients needed to create economic activity.

These findings are backed up by a new study, “Large Changes in Fiscal Policy Taxes Versus Spending,” authored by Alberto F. Alesina and Silvia Ardagna – both Harvard economists. Alesina and Ardagna find that:

…tax cuts are more expansionary than spending increases in the cases of fiscal stimulus. Based on these correlations…the current stimulus package in the US is too much tilted in the direction of spending rather than tax cuts.

In addition to their findings that tax cuts are better at promoting economic growth, Alesina and Ardagna found that spending-based stimuli are actually associated with lower economic growth rates.

The problem is that Democrats like Obama don’t know anything about economics, and they don’t care. They know less about economics than my keyboard. In fact that is exactly what being a Democrat means. It means that you know nothing about economics, but prefer to create policy based on feelings, rather than facts. Economics is irrelevant – they just want to be loved. It’s narcissism.

Economics in One Lesson

Perhaps it is time to review Henry Hazlitt’s Economics in One Lesson, chapter 4, entitled “Public Works Mean Taxes”.

Excerpt:

Therefore, for every public job created by the bridge project a private job has been destroyed somewhere else. We can see the men employed on the bridge. We can watch them at work. The employment argument of the government spenders becomes vivid, and probably for most people convincing. But there are other things that we do not see, because, alas, they have never been permitted to come into existence. They are the jobs destroyed by the $10 million taken from the taxpayers. All that has happened, at best, is that there has been a diversion of jobs because of the project. More bridge builders; fewer automobile workers, television technicians, clothing workers, farmers.

And consider Chapter 5 as well, entitled “Taxes Discourage Production”.

In our modern world there is never the same percentage of income tax levied on everybody. The great burden of income taxes is imposed on a minor percentage of the nation’s income; and these income taxes have to be supplemented by taxes of other kinds. These taxes inevitably affect the actions and incentives of those from whom they are taken. When a corporation loses a hundred cents of every dollar it loses, and is permitted to keep only fifty-two cents of every dollar it gains, and when it cannot adequately offset its years of losses against its years of gains, its policies are affected. It does not expand its operations, or it expands only those attended with a minimum of risk. People who recognize this situation are deterred from starting new enterprises. Thus old employers do not give more employment, or not as much more as they might have; and others decide not to become employers at all. Improved machinery and better-equipped factories come into existence much more slowly than they otherwise would. The result in the long run is that consumers are prevented from getting better and cheaper products to the extent that they otherwise would, and that real wages are held down, compared with what they might have been.

There is a similar effect when personal incomes are taxed 50, 60 or 70 percent. People begin to ask themselves why they should work six, eight or nine months of the entire year for the government, and only six, four or three months for themselves and their families. If they lose the whole dollar when they lose, but can keep only a fraction of it when they win, they decide that it is foolish to take risks with their capital. In addition, the capital available for risk-taking itself shrinks enormously. It is being taxed away before it can be accumulated. In brief, capital to provide new private jobs is first prevented from coming into existence, and the part that does come into existence is then discouraged from starting new enterprises. The government spenders create the very problem of unemployment that they profess to solve.

George W. Bush cut taxes in his first term and created 1 million NEW JOBS. Government spending is a job killer. And no amount of charm and teleprompter reading is going to change the laws of economics.

In fact, you can even see it failing today in Japan: Did massive government spending succeed or fail in Japan?

Commentary

What possible harm can result from premarital sex?

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Here’s an article by a Duke University student that talks about the hook-up phenomenon.

Excerpt:

Every weekend, girls across Duke’s campus wake up sad and confused. The previous night’s choices have not left them fulfilled or content. My girlfriends always seem hurt while the guys easily move on to their next fling. Why are the women upset? After all, it was supposed to be just sex-just one of the “responsible social decisions” discussed in The Real Deal. Without an explanation for their emotions, my friends are left feeling used and embarrassed. All I could do is sit with these women while they let painful tears flow.

Our women’s center and sexual health groups failed to tell us the whole truth. They may warn of the physical risks of “unsafe sex” but tend to ignore its emotional toll which also has biological roots. Research suggests that a hormone called oxytocin plays a role in the feelings of attachment and trust that women feel for their sexual partners. Female mammals primarily release oxytocin while giving birth and breast feeding and the hormone facilitates mother-child bonding. Oddly enough, the same hormone is also released during sexual contact causing a sense of attachment. In men, oxytocin’s effects are neutralized by the release of testosterone.

Did you catch that ladies? There is a biological explanation for the way you feel and the way he doesn’t feel.

I had always thought casual sex had different consequences for men and women. Now, based on scientific evidence, I know it does. College women at Duke are suffering emotional pain that’s not only avoidable-but, predictable.

Why weren’t we told this three years ago?

[…]The explanation is a radical feminist agenda that has a foothold in women’s health discussions. As Dr. Miriam Grossman, a psychiatrist at UCLA suggests in her book, Unprotected, “I once assumed campus medicine and psychology had one priority: student well-being. I’m no longer so naive. Radical politics pervades my profession, and common sense has vanished.” To propose that “safe” sexual experimentation may not be emotionally healthy and may be more dangerous for women than men is not politically correct.

Premarital sex hurts women. But it also hurts men.

It’s not like men are going to be happy about transitioning from years of hooking up with no responsibilities to the rigorous demands of a marriage. Premarital sex destroys the ability of women and men to bond, because it trains them to separate out their emotions from sex. It makes no sense to expose yourself emotionally during sex if you’re not married – you run the risk of being crushed by the pain of separation. Do it enough times, and it becomes extremely difficult to allow sex to bond two people together emotionally.

Commentary

MUST-READ: What’s the difference between science and scientism?

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Here’s an article by Edward Feser at Public Discourse. (H/T via ECM)

What is scientism?

Scientism is the view that all real knowledge is scientific knowledge—that there is no rational, objective form of inquiry that is not a branch of science. There is at least a whiff of scientism in the thinking of those who dismiss ethical objections to cloning or embryonic stem cell research as inherently “anti-science.” There is considerably more than a whiff of it in the work of New Atheist writers like Richard Dawkins and Christopher Hitchens, who allege that because religion has no scientific foundation (or so they claim) it “therefore” has no rational foundation at all.

What’s wrong with scientism?

Despite its adherents’ pose of rationality, scientism has a serious problem: it is either self-refuting or trivial. Take the first horn of this dilemma. The claim that scientism is true is not itself a scientific claim, not something that can be established using scientific methods. Indeed, that science is even a rational form of inquiry (let alone the only rational form of inquiry) is not something that can be established scientifically. For scientific inquiry itself rests on a number of philosophical assumptions: that there is an objective world external to the minds of scientists; that this world is governed by causal regularities; that the human intellect can uncover and accurately describe these regularities; and so forth. Since science presupposes these things, it cannot attempt to justify them without arguing in a circle. And if it cannot even establish that it is a reliable form of inquiry, it can hardly establish that it is the only reliable form. Both tasks would require “getting outside” science altogether and discovering from that extra-scientific vantage point that science conveys an accurate picture of reality—and in the case of scientism, that only science does so.

What else is wrong with scientism?

The irony is that the very practice of science itself, which involves the formulation of hypotheses, the weighing of evidence, the invention of technical concepts and vocabularies, the construction of chains of reasoning, and so forth—all mental activities saturated with meaning and purpose—falls on the “subjective,” “manifest image” side of scientism’s divide rather than the “objective,” “scientific image” side. Human thought and action, including the thoughts and actions of scientists, is of its nature irreducible to the meaningless, purposeless motions of particles and the like. Some thinkers committed to scientism realize this, but conclude that the lesson to draw is not that scientism is mistaken, but that human thought and action are themselves fictions. According to this radical position—known as “eliminative materialism” since it entails eliminating the very concept of the mind altogether instead of trying to reduce mind to matter—what is true of human beings is only what can be put in the technical jargon of physics, chemistry, neuroscience and the like. There is no such thing as “thinking,” “believing,” “desiring,” “meaning,” etc.; there is only the firing of neurons, the secretion of hormones, the twitching of muscles, and other such physiological events.

Scientism can’t even ground our own experience of 1st-person consciousness.