Our Next President?

[dcarrigg]

Re: Our Next President?

Direct federal student loans aren't sally mae, are they? Thought they're the majority and functionally direct loans from feds to students, and feds are the only ones holding the asset.

[dcarrigg]

Re: Our Next President?

Depressing, but true, as so much truth is these days.

Just think about all the plastic in landfills and the ocean that could be eliminated if we eliminated 90% of bottled water. Even if the last mile remains a problem, our water treatment plants still need major upgrades. Outdated water systems can't keep up with all the pharmaceutical drugs that are being peed down the toilets. They're in tap water and are effecting wildlife in rivers and streams.
https://www.cambridge.org/core/journ...FC9687F7215472

It's absolutely true. Other problem is that since existing treatment centers are down the gravity stream, lots of them flood out, and it increases the overall property damage of extreme weather events exponentially, along with tap water disruptions due to fecal coliform contamination. If former 100 year floods start coming at intervals closer to 10, it just compounds the problem. It's not only filtration and treatment methods that have improved either. Old pumps are wildly inefficient and use much more electricity than necessary. I think you're absolutely right that it's another spot where there has been underinvestment. We've set up a system in which there's trillions of dollars to invest in apps and luxury condos and weapons and advanced cruise control systems, but basic infrastructure gets no love.

I like to drive. I've never made it west of Iowa by car (not without flying and renting). But I've made it up and down the eastern seaboard from Nova Scotia to Florida, out through the midwest, everywhere in between. The lack of capital is plainly noticeable. Just looking around at the state of people's roofs and out buildings, the railroad ties holding up rusty bridges, the aging sewer systems still stamped with those letters W.P.A. There are little bubbles of wealth around the whole foods with new luxury condos and McMansions and new infrastructure, but a mile down the road it's decrepit again, and you're lucky to get a price rite or a dollar general, luckier still for walmart. There's still a few places that are in between, clinging to universities or some odd industry that's still there despite some long odds. But even these places are starting to look rougher, and the lack of investment is creeping from the outside in. And it's interesting to me how much of it is obviously political. Took a ferry across Lake Champlain a couple years ago. Vermont side was very posh and up to date. New York side was very...not. Same beautiful landscape, rolling hills and farms. But rotten farmhouses. Bombed out silos. Abandoned schools. Terrible roads full of cracks and holes. Vermont's kind of the opposite on the other side. No money in the northeast part. Very old towns and very old people maybe keep one grocery store and restaurant alive--moldy siding, stop signs faded to white, one corner of a fence still standing, blue tarp on the roof, bars on the windows of the convenience store with broken old gas pumps out front, rusty old railroad bridges--that type of thing. Cross into Quebec and there's investment again. It's not that the land's useless.

[BK]

Re: Our Next President?

Isn't a debt someone else asset? In a world before mutual funds and etfs I can see a debt Jubilee working. But, how many pension schemes own Sallie Mae Bonds or etc??

What am I missing?

[dcarrigg]

Re: Our Next President?

I've been thinking a lot about wealth redistribution today. I picked up this book the other day. It makes the case that debt cancellation was the basis of all historic civilizations. What would a debt cancellation look like today? If the debt was government debt then the government could simply declare the debt canceled and no obvious harm would be done to the public or the idea of debts as inviolable obligations. So in the case of student loans in the US. Federal student loans could be canceled. Even rescheduling student loans at current rates of interest would be an enormous improvement in the economy. This is what I think will happen if Trump runs again. Let's compare a high inflation over a short period of about 5 years ( EJ has proposed something similar once). What is the intent here? Are we trying to restore balance to the same level of wealth distribution that existed in ancient Babylon? France before the revolution? The US in 1850? 1950? 2006? What? How likely is this to succeed?

Cancelling federal debt like this doesn't change the balance much. It has a big impact on working class people with student loan debt, but retirees and people living on income from investment would not be affected. Major debt holders like banks would complain but ultimately they too would not be affected. Your typical billionaire wouldn't even notice. They might even welcome the move. The difference between inflation and limited debt cancellation is that inflation would impact banks, pension funds and wealthy individuals. If your intent is to reverse the wealth inequality than this looks like the way to do it. Inflation hits all debt not just student loans. The key here is control of the gold. If any billionaire manages to sequester a few thousand ounces of gold before the high ( note I didn't say hyper) inflation, the entire exercise fails. Debt cancellation by itself or inflation don't suffice. Wealth inequality is systemic.

This issue of wealth inequality has some levels to it. For instance I listened to Russell Napier talk about china. He said that china dictates the world inflation rate. He also predicts a much higher rate of inflation soon. This is interesting because India is predicted to surpass China as the most populous country soon. The Indian people collectively hold the largest private stocks of gold. Imagine the poorest people on earth suddenly becoming the richest. Geo-politically do you think that Donald Trump would put up with that? I can see him picking a fight with both India and China.

These are all interesting thoughts. What I think is probably needed at any level is a popular re-thinking of what private property is and what purpose it serves. Popular conceptions of it are extremely reactionary now by almost any historical standards. Folks who say "Forgive us our debts" daily in the Lord's Prayer turn around and preach the prosperity gospel and maximum punishment for debtors. When I talk to younger people, the very idea that patents or trademarks should ever expire seems beyond their comprehension. They just figure everything is owned by fictional legal entities in perpetuity. Ditto with inheritance. Like the frog, being slowly boiled, they extended the length of these things piece by piece until nobody alive remembers that six generation trusts and perpetual intellectual property rights are not normal. The ultimate goal is obvious: To allow all property to stay in bloodlines in perpetuity untaxed. It's more feudal than capitalist, really. But when that type of thing seems normal to people, they're even willing to stomach the elimination of bankruptcy protections (see student loans in the US). In that type of environment, is any debt jubilee possible? Even just getting back to the property laws of 20 years ago would be a hell of an accomplishment for 99.99% of Americans.

[shiny!]

Re: Our Next President?

The problem is last-mile. City can do more damage by ripping out lead pipes and updating infrastructure. Housing pipes that connect to the street mains in old neighborhoods are often lead. If the house is owned by broke people, they can't afford to redo that part. And two different metals together = battery = much worse lead leeching. Worse? Landlords have zero incentive to upgrade the pipes. They don't drink the water. Why blow thousands to make it clean?

This problem is pervasive. It's a problem for EV adoption. It's a problem for solar adoption. It's a problem for even basic insulation and efficiency. It's a problem for any updating of residential infrastructure whatsoever. 100 years ago, government sent guys around, and they did real work on real properties to update them, electrify them, connect them to water and sewer systems, etc. Now government only offers tax incentives. If we did electrification in the USA like we're doing 21st century stuff, a good chunk of the country still would be living in the dark. The last mile's always hard. But it's impossible to do with just markets and tax incentives.

I think it's short-sighted too. For the few extra million short term it'd cost a city to do it, image how much you'd save on the back end social services from the lead poisoning. Ditto on overall electric costs if you just went around insulating everything, especially at peak. It's basic bread and butter stuff. But somebody might get something for free. So it's verboten under neoliberal orthodoxy.

Depressing, but true, as so much truth is these days.

Just think about all the plastic in landfills and the ocean that could be eliminated if we eliminated 90% of bottled water. Even if the last mile remains a problem, our water treatment plants still need major upgrades. Outdated water systems can't keep up with all the pharmaceutical drugs that are being peed down the toilets. They're in tap water and are effecting wildlife in rivers and streams.
https://www.cambridge.org/core/journ...FC9687F7215472

[globaleconomicollaps]

Re: Our Next President?

Not to mention property law. How many times have IP rights or the dead hand of trust limits been extended? I think Florida's up to 360 years now the living must suffer the will of the dead. Was what? 21 years not so long ago? Then count every single property crime on the books and all the police-work to enforce them, right down to loitering and trespassing. Then count all the people who work to survey, plot and deed land for people like John Malone or Ted Turner who own more of it than several of the smaller 50 states, who undoubtedly bought the majority of it sight unseen. It's not possible for one person to amass billions worth of property, never-mind allow their children to inherit it, without an army of soldiers, police, judges, and bureaucrats on the ground to stop other people from using it or taking it. Imagine "owning" a non-contiguous area of land the size of Delaware or Connecticut. You gonna keep trespassers out yourself? Is it possible to even have a clue what you own at that point? I mean, someone who contracts for someone who works for someone who works for the owner might have a clue, maybe. But we're a long way away from yeomanry here. We're talking 10 times bigger than the Queen's Crown Estate in the UK. And I fully expect to see someone with 10 times that within a decade or two. Just an area the size of New York state "belonging" to one man. It's only a natural outcome of accelerating inequality. Especially if property law is considered absolute and there aren't methods to decay and recycle ownership so others might use things. We're already at 6 generation trusts and 4 generation IP and massive landholder property tax exemptions as common stuff. Soon we'll be closer to one man owning everything than everyone having an equal share. Might have already passed it. And there are no signs of slowing down.

Land is a zero sum game. Power is a zero sum game. Don't think the founding fathers established a republican form of government in the USA just so that tens of millions could live in one-room apartments, cramped by 1790s standards, and other men could have 10 times the UK landholdings of King George, areas bigger than several of the constituent states of the union. Top 100 all but certainly own land bigger than all New England combined now. And it's getting worse every year. Does anyone think continuing down that path ends well?

I've been thinking a lot about wealth redistribution today. I picked up this book the other day. It makes the case that debt cancellation was the basis of all historic civilizations. What would a debt cancellation look like today? If the debt was government debt then the government could simply declare the debt canceled and no obvious harm would be done to the public or the idea of debts as inviolable obligations. So in the case of student loans in the US. Federal student loans could be canceled. Even rescheduling student loans at current rates of interest would be an enormous improvement in the economy. This is what I think will happen if Trump runs again. Let's compare a high inflation over a short period of about 5 years ( EJ has proposed something similar once). What is the intent here? Are we trying to restore balance to the same level of wealth distribution that existed in ancient Babylon? France before the revolution? The US in 1850? 1950? 2006? What? How likely is this to succeed?

Cancelling federal debt like this doesn't change the balance much. It has a big impact on working class people with student loan debt, but retirees and people living on income from investment would not be affected. Major debt holders like banks would complain but ultimately they too would not be affected. Your typical billionaire wouldn't even notice. They might even welcome the move. The difference between inflation and limited debt cancellation is that inflation would impact banks, pension funds and wealthy individuals. If your intent is to reverse the wealth inequality than this looks like the way to do it. Inflation hits all debt not just student loans. The key here is control of the gold. If any billionaire manages to sequester a few thousand ounces of gold before the high ( note I didn't say hyper) inflation, the entire exercise fails. Debt cancellation by itself or inflation don't suffice. Wealth inequality is systemic.

This issue of wealth inequality has some levels to it. For instance I listened to Russell Napier talk about china. He said that china dictates the world inflation rate. He also predicts a much higher rate of inflation soon. This is interesting because India is predicted to surpass China as the most populous country soon. The Indian people collectively hold the largest private stocks of gold. Imagine the poorest people on earth suddenly becoming the richest. Geo-politically do you think that Donald Trump would put up with that? I can see him picking a fight with both India and China.

[dcarrigg]

Re: Our Next President?

Not to mention property law. How many times have IP rights or the dead hand of trust limits been extended? I think Florida's up to 360 years now the living must suffer the will of the dead. Was what? 21 years not so long ago? Then count every single property crime on the books and all the police-work to enforce them, right down to loitering and trespassing. Then count all the people who work to survey, plot and deed land for people like John Malone or Ted Turner who own more of it than several of the smaller 50 states, who undoubtably bought the majority of it sight unseen. It's not possible for one person to amass billions worth of property, never-mind allow their children to inherit it, without an army of soldiers, police, judges, and bureaucrats on the ground to stop other people from using it or taking it. Imagine "owning" a non-contiguous area of land the size of Delaware or Connecticut. You gonna keep trespassers out yourself? Is it possible to even have a clue what you own at that point? I mean, someone who contracts for someone who works for someone who works for the owner might have a clue, maybe. But we're a long way away from yeomanry here. We're talking 10 times bigger than the Queen's Crown Estate in the UK. And I fully expect to see someone with 10 times that within a decade or two. Just an area the size of New York state "belonging" to one man. It's only a natural outcome of accelerating inequality. Especially if property law is considered absolute and there aren't methods to decay and recycle ownership so others might use things. We're already at 6 generation trusts and 4 generation IP and massive landholder property tax exemptions as common stuff. Soon we'll be closer to one man owning everything than everyone having an equal share. Might have already passed it. And there are no signs of slowing down.

Land is a zero sum game. Power is a zero sum game. Don't think the founding fathers established a republican form of government in the USA just so that tens of millions could live in one-room apartments, cramped by 1790s standards, and other men could have 10 times the UK landholdings of King George, areas bigger than several of the constituent states of the union. Top 100 all but certainly own land bigger than all New England combined now. And it's getting worse every year. Does anyone think continuing down that path ends well?

[jk]

Re: Our Next President?

I understand what you're saying. But what is the goal in progressive taxation? Do we really object to people earning too much money or having too much money? If it's the latter, then why not just get rid of the income tax and only tax wealth? Or stop offering tax-free bonds and categorize all income the same so that if you earn returns on your wealth they are all taxed. Or tax spending through a higher sales tax.

I just have a hard time believing that achieving a specific tax goal for society requires having a small tax on basically everything.

The tax code is just insane. Here's a little anecdote:

My company had a sales tax audit a few years ago. One of the findings was that our vendor for coffee and tea wasn't collecting sales tax. Strangely, in Ohio at least, even though the vendor is required to collect the sales tax, it's still the customer who owes it if it's not collected. So they had to go back through our invoices to determine what we owed. Sounds simple enough, but not quite that simple.

Food isn't taxed in Ohio. Well, it is taxed if you dine-in at a restaurant, but carry-out and grocery is not taxed. So why do we owe taxes? Aren't coffee and tea considered food? Yes, they are! But...only sometimes. Bottled/canned coffee, without milk (or milk substitute), is not food. But if you add milk, now it is food. But a CUP of coffee IS food, even without milk. Unless, it's artificially sweetened, then it's not food. Unless it also contains milk, then it is food.

You can serve a customer a cup of coffee and it's not taxable. You can provide them with sugar and it's still not taxable. If you add the sugar for them, now you've created a soft drink which is always taxable. If you then add some milk, you've turned the soft drink back into food and it's no longer taxable.

So they had to go through every invoice, line by line, to determine whether 10 pods of hazelnut or whatever contained sweetener and/or milk and then assess the tax accordingly.

I'd love to hear the precise social purpose achieved by taxing those who drink their coffee with sugar, but not those who drink it black or those who drink it with cream and sugar. I'd also like to understand how long I could survive drinking only a "food" such as black coffee vs a "non-food" such as a juice drink containing less than 50% juice.

lol. loved the anecdote.

amused but disheartened by the idea of state employees spending hours going through your invoices to make these penny level determinations.

[peakishmael]

Re: Our Next President?

My proposal was mostly tongue-in-cheek. But to address your point... Any system of taxation results in a net tax-payer class and a net tax-receiver class resulting in mutual plunder among citizens.

Seems unnecessarily cynical. The point of taxation in general is to enable purchase of public goods, for which we are (as a group) better off. It isn't necessarily zero sum. And as far as I can tell it isn't easy to calculate who the "net receivers" are either. Seems one could argue that the ultra-wealthy benefit far more from both basic infrastructure and the military, for instance, in that their exorbitant incomes might not be possible without those services.

[dcarrigg]

Re: Our Next President?

Practical issues do not get people whipped into a frenzy like the divisive politics that dominate the discussion. Who cares about clean water? Which public bathrooms people can use is a much more important issue...

The problem is last-mile. City can do more damage by ripping out lead pipes and updating infrastructure. Housing pipes that connect to the street mains in old neighborhoods are often lead. If the house is owned by broke people, they can't afford to redo that part. And two different metals together = battery = much worse lead leeching. Worse? Landlords have zero incentive to upgrade the pipes. They don't drink the water. Why blow thousands to make it clean?

This problem is pervasive. It's a problem for EV adoption. It's a problem for solar adoption. It's a problem for even basic insulation and efficiency. It's a problem for any updating of residential infrastructure whatsoever. 100 years ago, government sent guys around, and they did real work on real properties to update them, electrify them, connect them to water and sewer systems, etc. Now government only offers tax incentives. If we did electrification in the USA like we're doing 21st century stuff, a good chunk of the country still would be living in the dark. The last mile's always hard. But it's impossible to do with just markets and tax incentives.

I think it's short-sighted too. For the few extra million short term it'd cost a city to do it, image how much you'd save on the back end social services from the lead poisoning. Ditto on overall electric costs if you just went around insulating everything, especially at peak. It's basic bread and butter stuff. But somebody might get something for free. So it's verboten under neoliberal orthodoxy.

[dcarrigg]

Re: Our Next President?

Those distinctions have a historical basis. When sales taxes were first introduced, food was not taxed. Over the years skirmishes broke out, with tax authorities claiming candy bars or soda pop are not basic food, but M&M Mars and Coca Cola saying they are indeed. So we end up with page after page of distinctions between taxable food and tax exempt food, each one the result of a tax code skirmish. The same skirmishes break out over what a poor person can buy with their food stamps. People scream if they see someone buying a steak or some shrimp with food stamps.

More than that, especially with states, everybody wants to tax "the other guy." Lots of places where "in state" tolls are $0.50, out of state are $4.00 or something, based on the address of a transponder. The whole idea of hotel and 'prepared meal' tax is that you're getting people from out of state to pay it. Same idea as the border stores and the all the rest. Since this type of thing is almost always popular, it flies through. People don't just scream if they see someone buying steak with food stamps. They scream at the idea that eating outside the home is ever necessary at all. Crank up the gambling revenue and cigarette excise while you're at it. We must take full advantage of the misery of addiction. They deserve maximum punishment anyways. Slobs. Sinners. Idiots. We must do everything we can to make them more miserable. The beatings will continue until morale improves. Would anyone like another corporate tax cut? How about a few billion on us? You want Kelo's little pink house? Nothing's good enough for our virtuous overlords. Nothing's bad enough for their wretched underlings. Calvinism reconstructed is wonderful. All the freedom of 5-points wealth worship, none of the responsibility of creating a shining city on a hill.

[thriftyandboringinohio]

Re: Our Next President?

...I'd love to hear the precise social purpose achieved by taxing those who drink their coffee with sugar, but not those who drink it black or those who drink it with cream and sugar. I'd also like to understand how long I could survive drinking only a "food" such as black coffee vs a "non-food" such as a juice drink containing less than 50% juice.

Those distinctions have a historical basis. When sales taxes were first introduced, food was not taxed. Over the years skirmishes broke out, with tax authorities claiming candy bars or soda pop are not basic food, but M&M Mars and Coca Cola saying they are indeed. So we end up with page after page of distinctions between taxable food and tax exempt food, each one the result of a tax code skirmish. The same skirmishes break out over what a poor person can buy with their food stamps. People scream if they see someone buying a steak or some shrimp with food stamps.

[DSpencer]

Re: Our Next President?

income tax taxes income. wealth/property tax taxes wealth. those 2 things may be very different and one doesn't substitute for the other. a very wealthy person, e.g., might generate very high income solely from tax-free bonds. this takes a lot of wealth.

also they have different political valences.

I understand what you're saying. But what is the goal in progressive taxation? Do we really object to people earning too much money or having too much money? If it's the latter, then why not just get rid of the income tax and only tax wealth? Or stop offering tax-free bonds and categorize all income the same so that if you earn returns on your wealth they are all taxed. Or tax spending through a higher sales tax.

I just have a hard time believing that achieving a specific tax goal for society requires having a small tax on basically everything.

The tax code is just insane. Here's a little anecdote:

My company had a sales tax audit a few years ago. One of the findings was that our vendor for coffee and tea wasn't collecting sales tax. Strangely, in Ohio at least, even though the vendor is required to collect the sales tax, it's still the customer who owes it if it's not collected. So they had to go back through our invoices to determine what we owed. Sounds simple enough, but not quite that simple.

Food isn't taxed in Ohio. Well, it is taxed if you dine-in at a restaurant, but carry-out and grocery is not taxed. So why do we owe taxes? Aren't coffee and tea considered food? Yes, they are! But...only sometimes. Bottled/canned coffee, without milk (or milk substitute), is not food. But if you add milk, now it is food. But a CUP of coffee IS food, even without milk. Unless, it's artificially sweetened, then it's not food. Unless it also contains milk, then it is food.

You can serve a customer a cup of coffee and it's not taxable. You can provide them with sugar and it's still not taxable. If you add the sugar for them, now you've created a soft drink which is always taxable. If you then add some milk, you've turned the soft drink back into food and it's no longer taxable.

So they had to go through every invoice, line by line, to determine whether 10 pods of hazelnut or whatever contained sweetener and/or milk and then assess the tax accordingly.

I'd love to hear the precise social purpose achieved by taxing those who drink their coffee with sugar, but not those who drink it black or those who drink it with cream and sugar. I'd also like to understand how long I could survive drinking only a "food" such as black coffee vs a "non-food" such as a juice drink containing less than 50% juice.

[DSpencer]

Re: Our Next President?

Usually when pols talk about infrastructure projects, they're talking about roads and bridges. But the electrical grid needs a lot of work. Most of all, I'd like to see a national committment (like Eisenhower's interstate highway system) to re-vamping our public water infrastructure so that water coming out of the tap is really clean.

Remember the old days when public water fountains were commonplace and people actually used them? Now everyone drinks bottled water without even thinking about it. We have charities handing plastic bottled water to homeless people in the heat of the summer, either because the water fountains aren't there anymore or because even the poorest of the poor are reluctant to drink from them.

If we could spend $$ on improving our public water supply, we could all but eliminate plastic bottled water. Think of the environmental and financial impact that would have. I'm surprised no one has picked this up as a major campaign issue.

Practical issues do not get people whipped into a frenzy like the divisive politics that dominate the discussion. Who cares about clean water? Which public bathrooms people can use is a much more important issue...

[Chris Coles]

Re: The Long Term Responsibilities for the Next President

Chris I finally found a few moments to read your post carefully. Your central points are unarguable.
Sadly, changes as sweeping as those take generations to accomplish. I like the term "boiling the ocean".
I prefer to look at the first small step.

Someone has to define the long term aiming points; if you do not have a map of where you are going, the chances of arrival are very slim indeed. Again, by making a point of defining what is wrong, from that point onwards, the people involved also have a recognition that they cannot continue without accepting the ongoing consequences. As I see it, my post WAS that first small step.